[Title 48 CFR ]
[Code of Federal Regulations (annual edition) - October 1, 1997 Edition]
[From the U.S. Government Publishing Office]


[[Page 1]]

          48



          Federal Acquisition Regulations System



          CHAPTER 2 (201-299)

                         Revised as of October 1, 1997

          CONTAINING
          A CODIFICATION OF DOCUMENTS
          OF GENERAL APPLICABILITY
          AND FUTURE EFFECT
          AS OF OCTOBER 1, 1997

          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]]


               As of October 1, 1997
               Title 48, Chapter 2, Parts 201 to 251,
               and
               Title 48, Chapter 2, Parts 252 to 299
               Revised as of July 1, 1996
               Are Replaced by
               Title 48, Chapter 2
               Parts 201 to 299



                     U.S. GOVERNMENT PRINTING OFFICE
                            WASHINGTON : 1997



               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 2--Department of Defense..........................       3
  Finding Aids:
    Table of CFR Titles and Chapters..........................     683
    Alphabetical List of Agencies Appearing in the CFR........     699
    List of CFR Sections Affected.............................     709



[[Page iv]]


      


--------------------------------------------------------------

   Cite this Code:  CFR

   To cite the regulations in this volume use title, part and
   section number. Thus,  48 CFR 201.103 refers to title 48,
   part 201, section 103.

--------------------------------------------------------------


[[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.

LEGAL STATUS

    The contents of the Federal Register are required to be judicially 
noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie 
evidence of the text of the original documents (44 U.S.C. 1510).

HOW TO USE THE CODE OF FEDERAL REGULATIONS

    The Code of Federal Regulations is kept up to date by the individual 
issues of the Federal Register. These two publications must be used 
together to determine the latest version of any given rule.
    To determine whether a Code volume has been amended since its 
revision date (in this case, October 1, 1997), consult the ``List of CFR 
Sections Affected (LSA),'' which is issued monthly, and the ``Cumulative 
List of Parts Affected,'' which appears in the Reader Aids section of 
the daily Federal Register. These two lists will identify the Federal 
Register page number of the latest amendment of any given rule.

EFFECTIVE AND EXPIRATION DATES

    Each volume of the Code contains amendments published in the Federal 
Register since the last revision of that volume of the Code. Source 
citations for the regulations are referred to by volume number and page 
number of the Federal Register and date of publication. Publication 
dates and effective dates are usually not the same and care must be 
exercised by the user in determining the actual effective date. In 
instances where the effective date is beyond the cut-off date for the 
Code a note has been inserted to reflect the future effective date. In 
those instances where a regulation published in the Federal Register 
states a date certain for expiration, an appropriate note will be 
inserted following the text.

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 
parts and an alphabetical list of agencies publishing in the CFR are 
also included in this volume.
    An index to the text of ``Title 3--The President'' is carried within 
that volume.
    The Federal Register Index is issued monthly in cumulative form. 
This index is based on a consolidation of the ``Contents'' entries in 
the daily Federal Register.
    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.

INQUIRIES

    For a legal interpretation or explanation of any regulation in this 
volume, contact the issuing agency. The issuing agency's name appears at 
the top of odd-numbered pages.
    For inquiries concerning CFR reference assistance, call 202-523-5227 
or write to the Director, Office of the Federal Register, National 
Archives and Records Administration, Washington, DC 20408.

SALES

    The Government Printing Office (GPO) processes all sales and 
distribution of the CFR. For payment by credit card, call 202-512-1800, 
M-F 8 a.m. to 4 p.m. e.s.t. or fax your order to 202-512-2233, 24 hours 
a day. For payment by check, write to the Superintendent of Documents, 
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Customer Service call 202-512-1803.

                              Raymond A. Mosley,
                                    Director,
                          Office of the Federal Register.

October 1, 1997.



[[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 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, 1997.

    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 first volume, containing chapter 1 (parts 1 to 51), includes an 
index to the Federal acquisition regulations.

    For this volume, Ann Elise Maso 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 2, parts 201 to 299)

  --------------------------------------------------------------------
                                                                    Part

Chapter 2--Department of Defense............................         201

[[Page 3]]



                    CHAPTER 2--DEPARTMENT OF DEFENSE




  --------------------------------------------------------------------

                          SUBCHAPTER A--GENERAL
Part                                                                Page
201             Federal Acquisition Regulations System......           7
202             Definitions of words and terms..............          11
203             Improper business practices and personal 
                    conflicts of interest...................          13
204             Administrative matters......................          16
                   SUBCHAPTER B--ACQUISITION PLANNING
205             Publicizing contract actions................          41
206             Competition requirements....................          43
207             Acquisition planning........................          46
208             Required sources of supplies and services...          49
209             Contractor qualifications...................          61
211             Describing agency needs.....................          68
212             Acquisition of commercial items.............          71
          SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES
213             Simplified acquisition procedures...........          74
214             Sealed bidding..............................          77
215             Contracting by negotiation..................          77
216             Types of contracts..........................         100
217             Special contracting methods.................         110
                  SUBCHAPTER D--SOCIOECONOMIC PROGRAMS
219             Small business programs.....................         125
222             Application of labor laws to government 
                    acquisitions............................         138
223             Environment, conservation, occupational 
                    safety, and drug-free workplace.........         151
224             Protection of privacy and freedom of 
                    information.............................         157
225             Foreign acquisition.........................         158
226             Other socioeconomic programs................         196
             SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS
227             Patents, data, and copyrights...............         200
228             Bonds and insurance.........................         241

[[Page 4]]

229             Taxes.......................................         244
230             Cost accounting standards...................         247
231             Contract cost principles and procedures.....         250
232             Contract financing..........................         255
233             Protests, disputes, and appeals.............         270
             SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING
234             Major system acquisition....................         272
235             Research and development contracting........         272
236             Construction and architect-engineer 
                    contracts...............................         295
237             Service contracting.........................         301
239             Acquisition of information technology.......         313
241             Acquisition of utility services.............         241
                    SUBCHAPTER G--CONTRACT MANAGEMENT
242             Contract administration.....................         325
243             Contract modifications......................         340
244             Subcontracting policies and procedures......         342
245             Government property.........................         343
246             Quality assurance...........................         366
247             Transportation..............................         377
248             Value engineering...........................         386
249             Termination of contracts....................         386
250             Extraordinary contractual actions...........         393
251             Use of government sources by contractors....         398
                     SUBCHAPTER H--CLAUSES AND FORMS
  
252             Solicitation provisions and contract clauses         400
253             Forms.......................................         548
             SUBCHAPTER I--AGENCY SUPPLEMENTARY REGULATIONS
                Appendix A--Armed Services Board of Contract 
                    Appeals.................................         578
                Appendix B--Coordinated Acquisition 
                    Assignments.............................         587
  

Appendix C [Reserved]

                Appendix D--Component Breakout..............         597
                Appendix E--DoD Spare Parts Breakout Program         598
                Appendix F--Material Inspection and 
                    Receiving Report........................         620
                Appendix G--Activity Address Numbers........         634
                Appendix H--Debarment and Suspension 
                    Procedures..............................         672
                Appendix I--Policy and Procedures for the 
                    DOD Pilot Mentor-Protege Program........         673


[[Page 5]]



  Note:  Although the text of Manuals and Supplements to the Defense FAR 
Supplement are not published in the Code of Federal Regulations, they 
were listed for the convenience of the user. All of the Supplements have 
been deleted. The only manuals which remain in effect are: Armed 
Services Pricing Manual (1986) and Armed Services Pricing Manual, Volume 
2, Price Analysis (1987).

[[Page 7]]



                          SUBCHAPTER A--GENERAL





PART 201--FEDERAL ACQUISITION REGULATIONS SYSTEM--Table of Contents




Sec.

               Subpart 201.1--Purpose, Authority, Issuance

201.103  Applicability.
201.104  Issuance.
201.104-3  Copies.

                      Subpart 201.2--Administration

201.201  Maintenance of the FAR.
201.201-1  The two councils.

              Subpart 201.3--Agency Acquisition Regulations

201.301  Policy.
201.303  Publication and codification.
201.304  Agency control and compliance procedures.

                 Subpart 201.4--Deviations From the FAR

201.402  Policy.
201.403  Individual deviations.
201.404  Class deviations.

        Subpart 201.6--Contracting Authority and Responsibilities

201.602  Contracting officers.
201.602-2  Responsibilities.
201.602-70  Contract clause.
201.603  Selection, appointment, and termination of appointment.
201.603-2  Selection.
201.603-3  Appointment.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36284, July 31, 1991, unless otherwise noted.



               Subpart 201.1--Purpose, Authority, Issuance



201.103  Applicability.

    The FAR and the Defense Federal Acquisition Regulation Supplement 
(DFARS) also apply to purchases and contracts by DoD contracting 
activities made in support of foreign military sales or North Atlantic 
Treaty Organization cooperative projects without regard to the nature or 
sources of funds obligated, unless otherwise specified in this 
regulation.



201.104  Issuance.



201.104-3  Copies.

    Copies of the DFARS in loose-leaf and CFR form may be purchased from 
the Superintendent of Documents, Government Printing Office, Washington, 
DC 20402-9325. Purchase of a copy of DFARS includes a subscription for 
Defense Acquisition Circulars.



                      Subpart 201.2--Administration



201.201  Maintenance of the FAR.



201.201-1  The two councils.

    (c) The composition and operation of the DAR Council is prescribed 
in DoD Directive 5000.35, Defense Acquisition Regulatory System.
    (d)(i) Departments and agencies process proposed revisions of FAR or 
DFARS through channels to the Director of the DAR Council. Process the 
proposed revision as a memorandum in the following format, addressed to 
the Director, DAR Council, OUSD(A&T), 3062 Defense Pentagon, Washington, 
DC 20301-3062; datafax (703) 602-0350:

    I. Problem: Succinctly state the problem created by current FAR and/
or DFARS coverage and describe the factual and/or legal reasons 
necessitating regulatory change.
    II. Recommendation: Identify the FAR and/or DFARS citations to be 
revised. Attach as TAB A a copy of the text of the existing coverage, 
conformed to include the proposed additions and deletions. Indicate 
deleted coverage with dashed lines through the current words being 
deleted and insert proposed language in brackets at the appropriate 
locations within the existing coverage. If the proposed deleted portion 
is extensive, it may be outlined by lines forming a box with diagonal 
lines drawn connecting the corners.
    III. Discussion: Include a complete, convincing explanation of why 
the change is necessary and how the recommended revision will solve the 
problem. Address advantages and disadvantages of the proposed revision, 
as well as any cost or administrative impact on Government activities 
and contractors. Identify any potential impact of the change on 
automated systems, e.g., automated financial and procurement systems. 
Provide any other background information that would be helpful in 
explaining the issue.

[[Page 8]]

    IV. Collaterals: Address the need for public comment (FAR 1.301(b) 
and subpart 1.5), the Paperwork Reduction Act, and the Regulatory 
Flexibility Act (FAR 1.301(c)).
    V. Deviations: If a recommended revision of DFARS is a FAR 
deviation, identify the deviation and include under separate TAB a 
justification for the deviation, which addresses the requirements of 
201.402(3). The justification should be in the form of a memorandum for 
the USD(A&T)DP.

    (ii) The public may offer proposed revisions of FAR or DFARS by 
submission of a memorandum, in the format (including all of the 
information) prescribed in paragraph (d)(i) of this subsection, to the 
Director of the DAR Council.
[56 FR 36284, July 31, 1991, as amended at 60 FR 61591, Nov. 30, 1995; 
61 FR 50451, Sept. 26, 1996]



              Subpart 201.3--Agency Acquisition Regulations



201.301  Policy.

    (a) DoD implementation and supplementation of the FAR is issued in 
the Defense Federal Acquisition Regulation Supplement (DFARS) under 
authorization and subject to the authority, direction, and control of 
the Secretary of Defense.
    (b) When Federal Register publication is required for any policy, 
procedure, clause, or form, the department or agency requesting USD(A&T) 
approval for use of the policy, procedure, clause, or form (see 
201.304(1)) must include an analysis of the public comments in the 
request for approval.
[56 FR 36284, July 31, 1991, as amended at 60 FR 61591, Nov. 30, 1995]



201.303  Publication and codification.

    (a)(i) The DFARS is codified under chapter 2 in title 48, Code of 
Federal Regulations.
    (ii) To the extent possible, all DFARS text (whether implemental or 
supplemental) is numbered as if it were implemental. Supplemental 
numbering is used only when the text cannot be integrated intelligibly 
with its FAR counterpart.
    (A) Implemental numbering is the same as its FAR counterpart, except 
when the text exceeds one paragraph, the subdivisions are numbered by 
skipping a unit in the FAR 1.104-2(b)(2) prescribed numbering sequence. 
For example, three paragraphs implementing FAR 19.501 would be numbered 
219.501 (1), (2), and (3) rather than (a), (b), and (c). Three 
paragraphs implementing FAR 19.501(a) would be numbered 219.501(a) (i), 
(ii), and (iii) rather than (a) (1), (2), and (3). Further subdivision 
of the paragraphs follows the prescribed numbering sequence, e.g., 
219.501(1)(i)(A)(1)(i).
    (B) Supplemental numbering is the same as its FAR counterpart, with 
the addition of a number of 70 and up or (S-70) and up. Parts, subparts, 
sections, or subsections are supplemented by the addition of a number of 
70 and up. Lower divisions are supplemented by the addition of a number 
of (S-70) and up. When text exceeds one paragraph, the subdivisions are 
numbered using the FAR 1.104-2(b)(2) prescribed sequence, without 
skipping a unit. For example, DFARS text supplementing FAR 19.501 would 
be numbered 219.501-70. Its subdivisions would be numbered 219.501-70 
(a), (b), and (c).
    (C) Subdivision numbering below the 4th level does not repeat the 
numbering sequence. It uses italicized Arabic numbers and then 
italicized lower case Roman numerals.
    (D) An example of DFARS numbering is in Table 1-1, DFARS Numbering.
    (iii) Department/agency and component supplements must parallel the 
FAR and DFARS numbering, except department/agency supplemental numbering 
uses subsection numbering of 90 and up, instead of 70 and up.

                       Table 1-1--DFARS Numbering                       
------------------------------------------------------------------------
       FAR             Is implemented as          Is supplemented as    
------------------------------------------------------------------------
19                 219                        219.70                    
19.5               219.5                      219.570                   
19.501             219.501                    219.501-70                
19.501-1           219.501-1                  219.501-1-70              
19.501-1(a)        219.501-1(a)               219.501-1(a)(S-70)        
19.501-1(a)(1)     219.501-1(a)(1)            219.501-1(a)(1)(S-70)     
------------------------------------------------------------------------


[[Page 9]]



201.304  Agency control and compliance procedures.

    Departments/agencies and their component organizations may issue 
acquisition regulations as necessary to implement or supplement the FAR 
or DFARS.
    (1) Approval of the USD(A&T) is required, before inclusion in a 
department/agency or component supplement or any other contracting 
regulatory document such as a policy letter, or clause book, of any 
policy, procedure, clause, or form which--
    (i) Has a significant effect beyond the internal operating 
procedures of the agency; or
    (ii) Has a significant cost or administrative impact on contractors 
or offerors.
    (2) The USD(A&T) has delegated authority to the USD(A&T)DP to 
approve or disapprove the policies, procedures, clauses, and forms 
subject to paragraph (1) of this section.
    (3) Approval of USD(A&T)DP is required for any class deviation (as 
defined in FAR subpart 1.4) from the FAR or DFARS, before its inclusion 
in a department/agency or component supplement or any other contracting 
regulatory document such as a policy letter or clause book.
    (4) Each department and agency shall develop and, upon approval by 
USD(A&T)DP, implement, maintain, and comply with a plan for controlling 
the use of clauses other than those prescribed by FAR or DFARS.
    (5) Departments/agencies submit requests for the USD(A&T) and 
USD(A&T)DP approvals required by this section through the Director of 
the DAR Council.
    (6) Revisions to the DFARS are issued through Defense Acquisition 
Circulars or Departmental Letters.
    (i) Defense Acquisition Circulars--
    (A) Are issued on a quarterly basis to all recipients of the DFARS.
    (B) Are published in the Federal Register.
    (C) Include, in addition to DFARS revisions, policies, directives, 
and informational items.
    (D) Include the effective dates for use of the revisions, policies, 
or directives. The effective date means the date on which the revisions, 
policies, or directives must be applied. Unless stated otherwise in the 
circular, any new or revised clauses, provisions, or forms must be 
included in solicitations issued on or after that date.
    (ii) Departmental Letters--
    (A) Are issued as necessary to the departments and agencies when 
time is of essence in disseminating a revision, policy, or directive.
    (B) Are effective until the revision, policy, or directive is 
superseded by publication of the material in a Federal Acquisition 
Circular, Defense Acquisition Circular, or other directive or is 
specifically withdrawn.
[56 FR 36284, July 31, 1991, as amended at 60 FR 61591, Nov. 30, 1995]



                 Subpart 201.4--Deviations From the FAR



201.402  Policy.

    (1) The Director of Defense Procurement, Office of the Under 
Secretary of Defense (Acquisition & Technology), USD(A&T)DP, is the 
approval authority within the DoD for--
    (i) Any individual deviation from--
    (A) FAR/DFARS Section 3.104, Procurement integrity;
    (B) FAR/DFARS Subpart 27.4, Rights in Data and Copyrights;
    (C) FAR/DFARS Subpart 31.1, Applicability (contract cost 
principles);
    (D) FAR/DFARS Subpart 31.2, Contracts with Commercial Organizations; 
or
    (E) FAR/DFARS Part 32, Contract Financing (except 32.7, 32.8, and 
the payment clauses prescribed by 32.1).
    (ii) Any class deviation.
    (2) Individual deviations.
    (i) Except as provided in paragraph (2)(ii) of this section, 
individual deviations, other than those in paragraph (1)(i) of this 
section, must be approved in accordance with the department/agency plan 
prescribed by 201.304(4).
    (ii) Contracting officers outside the United States are authorized 
to deviate from prescribed non-statutory FAR and DFARS clauses when 
contracting for support services, supplies, or construction, with the 
governments of North Atlantic Treaty Organization (NATO) countries or 
other allies (as described in 10 U.S.C. 2341(2)), or with United Nations 
or NATO organizations.

[[Page 10]]

This authority shall be exercised only if such governments or 
organizations will not agree to the standard clauses.
    (3) Submit requests for deviation approval through department/agency 
channels to the approval authority in paragraph (1) or (2), as 
appropriate. Submit deviations which require USD(A&T)DP approval through 
the Director of the DAR Council. At a minimum, each request must--
    (i) Identify the department/agency, and component if applicable, 
requesting the deviation;
    (ii) Identify the FAR or DFARS citation from which a deviation is 
needed, state what is required by that citation, and indicate whether an 
individual or class deviation is requested;
    (iii) Describe the deviation and indicate which of paragraphs (a) 
through (f) of FAR 1.401 best categorizes the deviation.
    (iv) State whether the deviation will have a significant effect 
beyond the internal operating procedures of the agency and/or a 
significant cost or administrative impact on contractors or offerors, 
and give reasons to support the statement;
    (v) State the period of time for which the deviation is required;
    (vi) State whether approval for the same deviation has been received 
previously, and if so, when;
    (vii) State whether the proposed deviation was published (see FAR 
subpart 1.5 for publication requirements) in the Federal Register and 
provide analysis of comments;
    (viii) State whether the request for deviation has been reviewed by 
legal counsel, and if so, state results; and
    (ix) Give detailed rationale for the request. State what problem or 
situation will be avoided, corrected, or improved if request is 
approved.
[56 FR 36284, July 31, 1991, as amended at 60 FR 61591, Nov. 30, 1995; 
61 FR 50451, Sept. 26, 1996]



201.403  Individual deviations.

    See approval requirements in 201.402.



201.404  Class deviations.

    See approval requirements in 201.402.



        Subpart 201.6--Contracting Authority and Responsibilities



201.602  Contracting officers.



201.602-2  Responsibilities.

    Contracting officers may designate qualified personnel as their 
authorized representatives to assist in the technical monitoring or 
administration of a contract. A contracting officer's representative 
(COR)--
    (1) Must be a Government employee, unless otherwise authorized in 
agency regulations.
    (2) Must be qualified by training and experience commensurate with 
the responsibilities to be delegated in accordance with department/
agency guidelines.
    (3) May not be delegated responsibility to perform functions at a 
contractor's location that have been delegated under FAR 42.202(a) to a 
contract administration office.
    (4) May not be delegated authority to make any commitments or 
changes that affect price, quality, quantity, delivery, or other terms 
and conditions of the contract.
    (5) Must be designated in writing, and a copy furnished the 
contractor and the contract administration office,--
    (i) Specifying the extent of the COR's authority to act on behalf of 
the contracting officer;
    (ii) Identifying the limitations on the COR's authority;
    (iii) Specifying the period covered by the designation;
    (iv) Stating the authority is not redelegable; and
    (v) Stating that the COR may be personally liable for unauthorized 
acts.
    (6) Must maintain a file for each contract assigned. This file must 
include, as a minimum--
    (i) A copy of the contracting officer's letter of designation and 
other documentation describing the COR's duties and responsibilities; 
and
    (ii) Documentation of actions taken in accordance with the 
delegation of authority.

[[Page 11]]



201.602-70  Contract clause.

    Use the clause at 252.201-7000, Contracting Officer's 
Representative, in solicitations and contracts when appointment of a 
contracting officer's representative is anticipated.



201.603  Selection, appointment, and termination of appointment.



201.603-2  Selection.

    (1) Pursuant to 10 U.S.C. 1724, in order to qualify to serve as a 
contracting officer with authority to award or administer contracts for 
amounts above the simplified acquisition threshold, a person must--
    (i) Have completed all mandatory contracting courses required for a 
contracting officer at the grade level, or in the position within the 
grade of the General Schedule in which the person is serving;
    (ii) Have at least two years experience in a contracting position;
    (iii) Have--
    (A) Received a baccalaureate degree from an accredited educational 
institution;
    (B) Completed at least 24 semester credit hours, or equivalent, of 
study from an accredited institution of higher education in any of the 
following disciplines: Accounting, business finance, law, contracts, 
purchasing, economics, industrial management, marketing, quantitative 
methods, and organization and management; or
    (C) Passed an examination considered to demonstrate skills, 
knowledge, or abilities comparable to that of an individual who has 
completed at least 24 semester credit hours, or equivalent, of study 
from an accredited institution of higher education in any of the 
disciplines in paragraph (1)(iii)(B) of this subsection; and
    (iv) Meet such additional requirements, based on the dollar value 
and complexity of the contracts awarded or administered in the position 
as may be established by the Secretary of Defense.
    (2) The requirements in 201.603-2(1)(iii) do not apply to any 
employee who, as of October 1, 1991, had at least 10 years experience in 
acquisition positions, in comparable positions in other government 
agencies or the private sector, or in similar positions in which the 
individual obtained experience directly relevant to the field of 
contracting.
    (3) The requirements in 201.603-2(1) do not apply to any employee 
for purposes of qualifying to serve in the position in which the 
employee is serving on October 1, 1993, or any other position in the 
same grade and involving the same level of responsibilities as the 
position in which the employee is serving on that date.
    (4) Waivers may be authorized. Information on waivers is contained 
in DoD Manual 5000.52-M, Career Development Program for Acquisition 
Personnel.
[58 FR 28463, May 13, 1993, as amended at 62 FR 34121, June 24, 1997]



201.603-3  Appointment.

    Certificates of Appointment executed under the Armed Services 
Procurement Regulation or the Defense Acquisition Regulation have the 
same effect as if they had been issued under FAR.



PART 202--DEFINITIONS OF WORDS AND TERMS--Table of Contents




    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

                       Subpart 202.1--Definitions



202.101  Definitions.

    Contracting activity for DoD also means elements designated by the 
director of a defense agency which has been delegated contracting 
authority through its agency charter. DoD contracting activities are--

                          Department of Defense

Real Estate and Facilities Directorate, Washington Headquarters Services
Defense Evaluation Support Activity
Department of Defense Office of Dependents Schools
Office of Civilian Health and Medical Program of the Uniformed Services

                                  Army

Contract Support Agency
Office of the Deputy Chief of Staff for Procurement, Headquarters, U.S. 
Army Materiel Command
Armament Munitions and Chemical Command

[[Page 12]]

Missile Command
Research Laboratory
Communications-Electronics Command
Troop Support Agency
Troop Support Command
Tank-Automotive Command
Aviation Systems Command
Training and Doctrine Command
Test and Evaluation Command
Forces Command
Health Services Command
Military District of Washington
U.S. Army, Europe
National Guard Bureau
Corps of Engineers
Information Systems Command
Medical Research and Development Command
U.S. Army, Pacific
Military Traffic Management Command
Space and Strategic Defense Command
Eighth U.S. Army
Depot System Command
Intelligence and Security Command
U.S. Army South
Defense Supply Service--Washington
Directorate of Information Systems for Command, Control, Communications 
and Computers, Office of the Secretary of the Army
U.S. Army Special Operations Command

                                  Navy

Deputy, Acquisition and Business Management, Office of the Assistant 
Secretary of the Navy (Research, Development, and Acquisition)
Directorate of Procurement Policy, Office of the Assistant Secretary of 
the Navy (Research, Development, and Acquisition)
Naval Air Systems Command
Space and Naval Warfare Systems Command
Naval Facilities Engineering Command
Naval Inventory Control Point
Naval Sea Systems Command
Naval Supply Systems Command
Office of Naval Research
Military Sealift Command
Strategic Systems Programs
Headquarters, U.S. Marine Corps
Marine Corps Systems Command
Installations and Logistics, Headquarters, U.S Marine Corps

                                Air Force

Office of the Deputy Assistant Secretary (Contracting)
Air Force Materiel Command
Air Combat Command
Air Mobility Command
Air Education and Training Command
Pacific Air Forces
United States Air Forces in Europe
Air Force Space Command

                Defense Advanced Research Projects Agency

Office of the Deputy Director, Management
Defense Finance and Accounting Service External Services, Defense 
Finance and Accounting Service

                   Defense Information Systems Agency

Defense Information Technology Contracting Organization

                       Defense Intelligence Agency

Office of Procurement

                        Defense Logistics Agency

Office of the Executive Director, Contract Management
Office of the Executive Director, Contracting
Defense Supply Centers
Defense Personnel Support Center

                   National Imagery and Mapping Agency

Procurement and Contracting Office

                     Defense Special Weapons Agency

Headquarters, Defense Special Weapons Agency

                        National Security Agency

Headquarters, National Security Agency

                        On-Site Inspection Agency

Acquisition Management Office

                 Ballistic Missile Defense Organization

Headquarters, Ballistic Missile Defense Organization

                United States Special Operations Command

Headquarters, United States Special Operations Command

    Contracting officer's representative means an individual designated 
and authorized in writing by the contracting officer to perform specific 
technical or administrative functions.
    Departments and agencies, as used in DFARS, means the military 
departments and the defense agencies. The military departments are the 
Departments of the Army, Navy, and Air Force (the Marine Corps is a part 
of the Department of the Navy). The defense agencies are the Defense 
Advanced Research Projects Agency, the Defense Commissary Agency, the 
Defense Finance and Accounting Service, the Defense Information Systems 
Agency, the Defense Intelligence Agency, the Defense Investigative 
Service, the Defense Logistics Agency, the National

[[Page 13]]

Imagery and Mapping Agency, the Defense Special Weapons Agency, the 
National Security Agency, the On-Site Inspection Agency, the Ballistic 
Missile Defense Organization, and the United States Special Operations 
Command.
    Department of Defense (DoD), as used in DFARS, means the Department 
of Defense, the military departments, and the defense agencies.
    Executive agency means for DoD, the Department of Defense, the 
Department of the Army, the Department of the Navy, and the Department 
of the Air Force.
    Head of the agency, means for DoD, the Secretary of Defense, the 
Secretary of the Army, the Secretary of the Navy, and the Secretary of 
the Air Force. Subject to the direction of the Secretary of Defense, the 
Under Secretary of Defense (Acquisition), and the Director of Defense 
Procurement, the directors of the defense agencies have been delegated 
authority to act as head of the agency for their respective agencies 
(i.e., to perform functions under the FAR or DFARS reserved to a head of 
agency or agency head), except for such actions that by terms of 
statute, or any delegation, must be exercised within the Office of the 
Secretary of Defense.
    Senior procurement executive, means for DoD--
    Department of Defense (including the defense agencies)--Under 
Secretary of Defense (Acquisition & Technology);
    Department of the Army--Assistant Secretary of the Army (Research, 
Development and Acquisition);
    Department of the Navy--Assistant Secretary of the Navy (Research, 
Development and Acquisition);
    Department of the Air Force--Assistant Secretary of the Air Force 
(Acquisition).
    The directors of the defense agencies have been delegated authority 
to act as senior procurement executive for their respective agencies, 
except for such actions that by terms of statute, or any delegation, 
must be exercised by the Under Secretary of Defense (Acquisition & 
Technology).
[56 FR 36287, July 31, 1991, as amended at 56 FR 67212, Dec. 30, 1991; 
57 FR 42629, Sept. 15, 1992; 59 FR 27668, May 27, 1994; 60 FR 29497, 
June 5, 1995; 60 FR 61591, Nov. 30, 1995; 61 FR 7741, Feb. 29, 1996; 61 
FR 50451, Sept. 26, 1996; 62 FR 34121, June 24, 1997]



PART 203--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST--Table of Contents




Sec.

                        Subpart 203.1--Safeguards

203.103  Independent pricing.
203.103-2  Evaluating the certification.
203.104  Procurement integrity.
203.104-5  Disclosure of proprietary and source selection information.

      Subpart 203.2--Contractor Gratuities to Government Personnel

203.203  Reporting suspected violations of the Gratuities clause.

        Subpart 203.3--Reports of Suspected Antitrust Violations

203.301  General.

                     Subpart 203.4--Contingent Fees

203.405  Misrepresentations or violations of the Covenant Against 
          Contingent Fees.

            Subpart 203.5--Other Improper Business Practices

203.502  Subcontractor kickbacks.
203.502-2  General.
203.570  Employment prohibitions on persons convicted of fraud or other 
          DoD contract-related felonies.
203.570-1  Scope.
203.570-2  Policy.
203.570-3  Waiver.
203.570-4  Reporting.
203.570-5  Contract clause.

             Subpart 203.7--Voiding and Rescinding Contracts

203.703  Authority.

             Subpart 203.70--Contractor Standards of Conduct

203.7000  Policy.

[[Page 14]]

203.7001  Procedures.
203.7002  Contract clause.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36288, July 31, 1991, unless otherwise noted.



                        Subpart 203.1--Safeguards



203.103  Independent pricing.



203.103-2  Evaluating the certification.

    (b)(3) The contracting officer also shall report the matter in 
accordance with 209.406-3 and DoDD 7050.5, Coordination of Remedies for 
Fraud and Corruption Related to Procurement Activities.



203.104  Procurement integrity.



203.104-5  Disclosure of proprietary and source selection information.

    (d)(4) For purposes of FAR 3.104-5(d)(4) only, DoD follows the 
notification procedures in FAR 27.404(h). However, the first sentence in 
FAR 27.404(h) does not apply to DoD.
[56 FR 36288, July 31, 1991, as amended at 62 FR 2612, Jan. 17, 1997]



      Subpart 203.2--Contractor Gratuities to Government Personnel



203.203  Reporting suspected violations of the Gratuities clause.

    Report suspected violations of the Gratuities clause in accordance 
with 209.406-3 and DoDD 7050.5, Coordination of Remedies for Fraud and 
Corruption Related to Procurement Activities.



        Subpart 203.3--Reports of Suspected Antitrust Violations



203.301  General.

    (b) Report suspected antitrust violations in accordance with 
209.406-3 and DoDD 7050.5, Coordination of Remedies for Fraud and 
Corruption Related to Procurement Activities.



                     Subpart 203.4--Contingent Fees



203.405  Misrepresentations or violations of the Covenant Against Contingent Fees.

    (b) Report suspected fraud or other criminal conduct in accordance 
with 209.406-3 and DoDD 7050.5, Coordination of Remedies for Fraud and 
Corruption Related to Procurement Activities.
[56 FR 36288, July 31, 1991. Redesignated at 62 FR 34121, June 24, 1997]



            Subpart 203.5--Other Improper Business Practices



203.502  Subcontractor kickbacks.

    Report suspected violations of the Anti-Kickback Act in accordance 
with 209.406-3 and DoDD 7050.5, Coordination of Remedies for Fraud and 
Corruption Related to Procurement Activities.



203.502-2  General.

    (h) The DoD Inspector General has designated Special Agents of the 
following investigative organizations as representatives for conducting 
inspections and audits under the Anti-Kickback Act of 1986:
    (i) U.S. Army Criminal Investigation Command.
    (ii) Naval Criminal Investigative Service.
    (iii) Air Force Office of Special Investigations.
    (iv) Defense Criminal Investigative Service.
[56 FR 36288, July 31, 1991, as amended at 60 FR 29497, June 5, 1995]



203.570  Employment prohibitions on persons convicted of fraud or other DoD contract-related felonies.



203.570-1  Scope.

    This subpart prescribes policies and procedures to implement 10 
U.S.C. 2408.



203.570-2  Policy.

    (a) Contractors or subcontractors shall not knowingly allow a 
person, convicted after September 29, 1988, of fraud or any other felony 
arising out of a contract with the DoD, to serve--
    (1) In a management or supervisory capacity on any DoD contract or 
first-tier subcontract; or,

[[Page 15]]

    (2) On its board of directors; or
    (3) As a consultant, agent, or representative.
    (b) The period covered by the prohibition in paragraph (a) of this 
subsection is for five years from the date of conviction unless waived 
in the interest of national security by the agency head or designee.



203.570-3  Waiver.

    (a) The contracting officer shall--
    (1) Review any request for waiver; and
    (2) Deny the request if the contracting officer decides the waiver 
is not required in the interests of national security; or
    (3) Forward the request to the head of the agency or designee for 
approval if the contracting officer decides the waiver may be in the 
interest of national security.
    (b) The head of the agency or designee shall report all waivers 
granted, and the reasons for granting the waiver, to the Under Secretary 
of Defense (Acquisition), who will forward the report to Congress as 
required by 10 U.S.C. 2408(a)(3).



203.570-4  Reporting.

    When a Defense contractor or first-tier subcontractor is found in 
violation of the prohibition in 203.570-2, the contracting officer shall 
report the matter in accordance with 209.406-3 and DoDD 7050.5, 
Coordination of Remedies for Fraud and Corruption Related to Procurement 
Activities.



203.570-5  Contract clause.

    Use the clause at 252.203-7001, Special Prohibition on Employment, 
in all solicitations and contracts exceeding the simplified acquisition 
threshold, except solicitations and contracts for commercial items.
[60 FR 61592, Nov. 30, 1995, as amended at 62 FR 34121, June 24, 1997]



             Subpart 203.7--Voiding and Rescinding Contracts



203.703  Authority.

    The authority to act for the agency head under this subpart is 
limited to a level no lower than an official who is appointed by and 
with the advice of the Senate, without power of redelegation. For the 
defense agencies, for purposes of this subpart, the agency head designee 
is the Under Secretary of Defense (Acquisition & Technology).
[56 FR 36288, July 31, 1991, as amended at 60 FR 61592, Nov. 30, 1995]



             Subpart 203.70--Contractor Standards of Conduct



203.7000  Policy.

    Government contractors must conduct themselves with the highest 
degree of integrity and honesty. Contractors should have standards of 
conduct and internal control systems that--
    (1) Are suitable to the size of the company and the extent of their 
involvement in Government contracting,
    (2) Promote such standards,
    (3) Facilitate timely discovery and disclosure of improper conduct 
in connection with Government contracts, and
    (4) Ensure corrective measures are promptly instituted and carried 
out.



203.7001  Procedures.

    (a) A contractor's system of management controls should provide 
for--
    (1) A written code of business ethics and conduct and an ethics 
training program for all employees;
    (2) Periodic reviews of company business practices, procedures, 
policies, and internal controls for compliance with standards of conduct 
and the special requirements of Government contracting;
    (3) A mechanism, such as a hotline, by which employees may report 
suspected instances of improper conduct, and instructions that encourage 
employees to make such reports;
    (4) Internal and/or external audits, as appropriate;
    (5) Disciplinary action for improper conduct;
    (6) Timely reporting to appropriate Government officials of any 
suspected or possible violation of law in connection with Government 
contracts or any other irregularities in connection with such contracts; 
and

[[Page 16]]

    (7) Full cooperation with any Government agencies responsible for 
either investigation or corrective actions.
    (b) Contractors who are awarded a DoD contract of $5 million or more 
must display DoD Hotline Posters prepared by the DoD Office of the 
Inspector General unless--
    (1) The contract will be performed in a foreign country; or
    (2) The contractor has established an internal reporting mechanism 
and program, as described in paragraph (a) of this section.



203.7002  Contract clause.

    Use the clause at 252.203-7002, Display of DoD Hotline Poster, in 
solicitations and contracts expected to exceed $5 million, except when 
performance will take place in a foreign country.



PART 204--ADMINISTRATIVE MATTERS--Table of Contents




Sec.

                    Subpart 204.1--Contract Execution

204.101  Contracting officer's signature.

                  Subpart 204.2--Contract Distribution

204.201  Procedures.
204.202  Agency distribution requirements.

   Subpart 204.4--Safeguarding Classified Information Within Industry

204.402  General.
204.404  Contract clause.
204.404-70  Additional contract clauses.

                    Subpart 204.6--Contract Reporting

204.600  Scope of subpart.
204.601  Record requirements.
204.602  Federal Procurement Data System.
204.602-70  Solicitation provision.
204.670  Defense Contract Action Data System (DCADS).
204.670-1  Definitions.
204.670-2  Reportable contracting actions.
204.670-3  Contracting office responsibilities.
204.670-4  Contract administration office responsibilities.
204.670-5  Departmental data collection point responsibilities.
204.670-6  Types of DD Form 350 reports.
204.670-7  Report formats.
204.670-8  Security classification.
204.670-9  Reporting of individual contracting actions of $25,000 or 
          less.

                      Subpart 204.8--Contract Files

204.802  Contract files.
204.804  Closeout of contract files.
204.804-1  Closeout by the office administering the contract.
204.804-2  Closeout of the contracting office files if another office 
          administers the contract.
204.805  Disposal of contract files.

  Subpart 204.9--Information Reporting to the Internal Revenue Service

204.902  General.

  Subpart 204.70--Uniform Procurement Instrument Identification Numbers

204.7000  Scope.
204.7001  Policy.
204.7002  Procedures.
204.7003  Basic PII number.
204.7004  Supplementary PII numbers.

       Subpart 204.71--Uniform Contract Line Item Numbering System

204.7100  Scope.
204.7101  Definitions.
204.7102  Policy.
204.7103  Contract line items.
204.7103-1  Criteria for establishing.
204.7103-2  Numbering procedures.
204.7104  Contract subline items.
204.7104-1  Criteria for establishing.
204.7104-2  Numbering procedures.
204.7105  Contract exhibits and attachments.
204.7106  Contract modifications.
204.7107  Contract accounting classification reference number (ACRN).

                Subpart 204.72--Contractor Identification

204.7200  Scope of subpart.
204.7201  Definitions.
204.7202  General.
204.7202-1  CAGE codes.
204.7202-2  DUNS numbers.
204.7202-3  Taxpayer identification numbers.
204.7203  Responsibilities of contracting officers.
204.7204  Maintenance of the CAGE file.
204.7205  Novation agreements, mergers and sales of assets.
204.7206  Using CAGE codes to identify agents and brokers.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36289, July 31, 1991, unless otherwise noted.

[[Page 17]]



                    Subpart 204.1--Contract Execution



204.101  Contracting officer's signature.

    (a)(i) Include the contracting officer's telephone number on 
contracts and modifications.
    (ii) The contracting officer may sign bilateral modifications of a 
letter contract before signature by the contractor.



                  Subpart 204.2--Contract Distribution



204.201  Procedures.

    (1) The procuring contracting officer (PCO) retains the original 
signed contract for the official contract file. Administrative 
contracting officers and terminations contracting officers provide the 
original of each modification to the PCO for retention in the official 
contract file. Unless otherwise directed by department/agency 
procedures, the office issuing the orders maintains the original of 
orders under basic ordering agreements and the original of provisioning 
orders.
    (2) Ensure that distribution of contracts and modifications is 
consistent with security directives.
    (e)(i) Distribute one copy of each of the following types of 
contracts or modifications to the appropriate Defense Contract Audit 
Agency (DCAA) field audit office (listed in the DCAA Directory--
Headquarters and Field Offices)--
    (A) Cost reimbursement;
    (B) Time-and-materials;
    (C) Labor-hour;
    (D) Fixed price contracts with provisions for redetermination, 
incentives, economic price adjustment, or cost allowability; and
    (E) Any other contract that requires audit service.
    (ii) If there is a question as to the appropriate DCAA field audit 
office, request the assistance of the DCAA procurement liaison auditor 
or the nearest DCAA field audit office.
    (f) Provide two copies to offices performing contract administration 
support functions.
[56 FR 36289, July 31, 1991, as amended at 59 FR 27668, May 27, 1994]



204.202  Agency distribution requirements.

    (1) Distribute copies of contracts as follows--
    (i) Four copies to the contract administration office (send 
simultaneously with the copy furnished under FAR 4.201(b));
    (ii) One copy to each consignee indicated in the contract. A 
transshipping terminal is not a consignee.
    (A) Inventory control points that have an automated uniform 
inventory control point data base that interfaces with consignees may 
use their automated procedure rather than sending a written copy of the 
contract. However, when inspection is required at destination, send a 
written copy to the consignee.
    (B) The Defense Logistics Agency is authorized to prescribe 
alternate procedures for distribution of contract documents in Defense 
Subsistence Region, Europe;
    (iii) Two copies to the military interdepartmental purchase request 
requiring activity in the case of coordinated acquisition;
    (iv) One copy to the contract administration office (CAO) automatic 
data processing point, except when the DoDAAD code is the same as that 
of either the CAO or payment office (see DLAH 4105.4, DoD Directory of 
Contract Administration Services Components); and
    (v) One copy, or an extract of the pertinent information, to the 
cognizant Defense Investigative Service office listed in DoD 5100.76-M, 
Physical Security of Sensitive Conventional Arms, Ammunition, and 
Explosives, when the clause at 252.223-7007, Safeguarding Sensitive 
Conventional Arms, Ammunition, and Explosives, is included in the 
contract.
    (2) The activity executing a contract modification shall furnish a 
copy of the basic contract and all modifications to--

[[Page 18]]

    (i) The new and old payment office when adding or changing a payment 
office;
    (ii) The new contract administration office, a new consignee or 
other activity, based on the extent to which each activity is concerned 
with the basic contract and modifications.
    (3) Distribution of modifications issued to provide initial or 
amended shipping instructions under 204.7004(c)(3)(iii) and 204.7004(f) 
may be limited to the following--
    (i) Contractor, one copy;
    (ii) Receiving activity, one copy each;
    (iii) Contract administration office, one copy;
    (iv) Payment office, one copy; and
    (v) Contract administration office automatic data processing point, 
one copy.
    (4) Distribution of modifications generated by automated means 
(computer programs) may be limited to the following--
    (i) Contractor, one copy;
    (ii) Contract administration office, one copy;
    (iii) New payment office, one copy;
    (iv) Procuring contracting office, one copy;
    (v) Funding activities, one copy to each; and
    (vi) Consignee, one copy to each.
[56 FR 36289, July 31, 1991, as amended at 61 FR 7742, Feb. 29, 1996]



   Subpart 204.4--Safeguarding Classified Information Within Industry



204.402  General.

    (1) Subpart 239.74 contains policy and procedures for securing 
telecommunications between Government agencies and contractors and 
subcontractors.
    (2) Pursuant to section 808 of Pub. L. 102-190, DoD employees or 
members of the Armed Forces who are assigned to or visiting a contractor 
facility and are engaged in oversight of an acquisition program will 
retain control of their work product. Classified work products of DoD 
employees or members of the Armed Forces shall be handled in accordance 
with DoD 5220.22-M, Industrial Security Manual, and DoD 5220.22-R, 
Industrial Security Regulation. Contractor procedures for protecting 
against unauthorized disclosure of information shall not require DoD 
employees or members of the Armed Forces to relinquish control of their 
work products, whether classified or not, to a contractor.
[57 FR 14992, Apr. 23, 1992]



204.404  Contract clause.



204.404-70  Additional contract clauses.

    (a) Use the clause at 252.204-7000, Disclosure of Information, in 
solicitations and contracts when the contractor will have access to or 
generate unclassified information that may be sensitive and 
inappropriate for release to the public.
    (b) Use the clause at 252.204-7003, Control of Government Personnel 
Work Product, in all solicitations and contracts.
[57 FR 14992, Apr. 23, 1992]



                    Subpart 204.6--Contract Reporting



204.600  Scope of subpart.

    The Defense Contract Action Data System (DCADS) (see 204.670) is the 
DoD reporting system which supports the uniform reporting requirements 
for--
    (1) DD Form 350, Individual Contracting Action Report; and
    (2) DD Form 1057, Monthly Summary of Actions $25,000 or Less.



204.601  Record requirements.

    (a) The DCADS meets these record retention requirements.
    (d) The Directorate for Information, Operation, and Reports (DIOR), 
of the Washington Headquarters Services (WHS) transmits required DoD 
information to the Federal Procurement Data System.



204.602  Federal Procurement Data System.

    (c) DoD uses the DD Form 350, Individual Contracting Action Report, 
in lieu of the SF 279, Federal Procurement Data System (FPDS) Individual 
Contract Action Report. DoD uses the DD Form 1057, Monthly Contracting 
Summary of Actions $25,000 or Less, in lieu of the SF 281, FPDS Summary

[[Page 19]]

Contract Action Report ($25,000 or Less).



204.602-70  Solicitation provision.

    When the Commercial and Government Entity codes for the prospective 
offerors are not available to the contracting office, use the provision 
at 252.204-7001, Commercial and Government Entity (CAGE) Code Reporting.
[61 FR 61592, Nov. 30, 1995]



204.670  Defense Contract Action Data System (DCADS)



204.670-1  Definitions.

    As used in this section and 253.204-70 and 253.204-71--
    (a) Contract administration office means an office, other than the 
contracting office, which awards or executes contracting actions on 
behalf of the contracting office, including actions relating to the 
settlement of terminated contracts.
    (b) Contracting action means any written action obligating or 
deobligating funds in connection with the purchasing, renting, or 
leasing of supplies, services, or construction. The term does not 
include grants or cooperative agreements. The term includes, but is not 
limited to--
    (1) Definitive contracts, including notices of award;
    (2) Letter contracts;
    (3) Purchase orders;
    (4) Orders under existing contracts or agreements, e.g.--
    (i) Orders against basic ordering agreements, including service 
orders issued on DD Form 1164 by installation transportation offices;
    (ii) Calls against blanket purchase agreements;
    (iii) Job orders;
    (iv) Task orders;
    (v) Delivery orders;
    (vi) Communication services authorizations; and
    (vii) Notices of termination or cancellation.
    (5) Contract modifications, e.g.--
    (i) Change orders;
    (ii) Supplemental agreements;
    (iii) Funding actions; and
    (iv) Option exercises.
    (c) Departmental data collection points are--
    (1) For the Army (including Corps of Engineers civil Works): U.S. 
Army Contracting Support Agency, Attn: SFAE-CSA-PPS, 5109 Leesburg Pike, 
Suite 916, Falls Church, VA 22041-3201
    (2) For the Navy: Fleet Industrial Supply Center, Norfolk Detachment 
Washington, Attn: PMRS, Washington Navy Yard, Bldg. 200, 4th 
Floor, 800 M Street, SW, Washington, DC 20374-2004
    (3) For the Air Force: SAF/AQCI, 1060 Air Force Pentagon, 
Washington, DC 20330-1060
    (4) For the Defense Logistics Agency: Headquarters, Defense 
Logistics Agency, Attn: Directorate of Procurement (Acquisition 
Operations Team), 8725 John J. Kingman Road, Suite 3147, Ft. Belvoir, VA 
22060-6221.
    (5) For other DoD contracting activities: U.S. Army Contracting 
Support Agency, Attn: SFAE-CSA-PPS, 5109 Leesburg Pike, Suite 916, Falls 
Church, VA 22041-3201.
    (d) United States and outlying areas is defined in Federal 
Information Processing Standard Publication (FIPS PUB) 55-2, Guideline: 
Codes for Named Populated Places, Primary County Divisions, and Other 
Locational Entities of the United States and Outlying Areas. Outlying 
areas are--
    (1) American Samoa;
    (2) The Federated States of Micronesia;
    (3) Guam;
    (4) The Marshall Islands;
    (5) Northern Mariana Islands;
    (6) The Trust Territory of Palau;
    (7) Puerto Rico;
    (8) The U.S. Minor Outlying Islands; and
    (9) The U.S. Virgin Islands.
[56 FR 36289, July 31, 1991, as amended at 60 FR 61592, Nov. 30, 1995; 
61 FR 51030, Sept. 30, 1996; 62 FR 34121, June 24, 1997]



204.670-2  Reportable contracting actions.

    (a) Except as provided in paragraph (c) of this subsection, complete 
a DD Form 350 for--
    (1) All contracting actions, including actions executed by DoD for 
purchase of land, or rental or lease of real property, that obligate or 
deobligate more than $25,000; and
    (2) All contracting actions that obligate or deobligate $25,000 or 
less if the

[[Page 20]]

action is in a designated industry group under the small business 
competitiveness demonstration program (See 204.670-9 and FAR subpart 
19.10).
    (b) Except as provided in paragraph (c) of this subsection, complete 
a DD Form 1057 for all contracting actions which obligate or deobligate 
$25,000 or less, including contracting actions reported on a DD Form 350 
under paragraph (a)(2) of this subsection.
    (c) Summarize on the monthly DD Form 1057, in accordance with the 
instructions in 253.204-71(a)(3), contracting actions that support a 
contingency operation (see 213.000) and that obligate or deobligate 
funds exceeding $25,000 but not exceeding $200,000.
    (d) The following contracting actions shall not be reported on 
either the DD Form 350 or DD Form 1057:
    (1) Imprest fund transactions, SF 44 purchases, and micro-purchases 
obtained through use of the purchase card;
    (2) Transactions that cite only nonappropriated funds (Funds held in 
trust accounts for foreign governments shall be treated as appropriated 
funds.);
    (3) Transactions for purchase of land, or rental or lease of real 
property, when the General Services Administration (GSA) executes the 
contracting action;
    (4) Orders from GSA stock and the GSA Consolidated Purchase Program;
    (5) Transactions that involve Government bills of lading or 
transportation requests, except orders placed under Regional Storage 
Management Office's (RSMO) BOAs;
    (6) Requisitions transferring supplies within or among the 
departments or agencies; and
    (7) Pursuant to 204.670-6(b), orders placed by other contracting 
activities against indefinite delivery contracts awarded by the--
    (i) Military Sealift Command;
    (ii) Defense Fuel Supply Center for petroleum and petroleum 
products; or
    (iii) Defense Supply Center, Richmond, for petroleum products.
[56 FR 36289, July 31, 1991, as amended at 57 FR 53598, Nov. 12, 1992; 
60 FR 61592, Nov. 30, 1995; 61 FR 51030, Sept. 30, 1996; 62 FR 34121, 
June 24, 1997; 62 FR 44222, Aug. 20, 1997]



204.670-3  Contracting office responsibilities.

    (a) For DD Form 350, contracting offices--
    (1) Prepare the appropriate type of DD Form 350 (see 204.670-6), in 
accordance with the instructions in 253.204-70, on all reportable 
contracting actions (see 204.670-2(a)), including actions accomplished 
by contract administration offices on behalf of the contracting office.
    (2) Complete the DD Form 350 in the required format within three 
working days after the date on which the dollars were actually obligated 
or deobligated (see 204.670-7). Submit all contracting actions for the 
calendar month to the departmental data collection point (see 204.670-
1(c)) in accordance with departmental/agency procedures, except--
    (i) For Defense Fuel Supply Center major petroleum acquisitions 
which result in multiple awards, the due date is ten working days when 
permitted by the departmental data collection point;
    (ii) For actions executed in the month of September, due dates may 
be extended ten calendar days when permitted by the departmental data 
collection point; and
    (iii) For actions accomplished by a contract administration office, 
the due date is three working days after the receipt of the contractual 
instrument annotated ``DD FORM 350 REPORTING COPY.''
    (3) Prepare and submit a corrected or cancelling DD Form 350 as 
required in accordance with departmental data collection point 
instructions.
    (4) Establish a control system for assigning report numbers to DD 
Forms 350 (Block A2 of the DD Form 350). The number shall have four 
positions and may be any combination of alpha or numeric characters. If 
more than one activity within a contracting office utilizes the same 
reporting office code, the contracting office shall assign separate 
blocks of numbers to each activity in order to prevent duplication of 
report numbers.
    (5) Maintain a copy of the DD Form 350 in the contract file, in 
accordance with departmental/agency procedures.
    (b) For DD Form 1057, contracting offices--

[[Page 21]]

    (1) Prepare a DD Form 1057, in accordance with the instructions in 
253.204-71, covering reportable contracting actions (see 204.670-2(b)), 
including actions accomplished by contract administration offices on 
behalf of the contracting office. An installation, base, or other 
activity may have more than one contracting office code to separate the 
various types of acquisitions, such as base and central contracting, or 
RDT&E and non-RDT&E acquisition. Each contracting office with a separate 
code must submit its own DD Form 1057.
    (2) Complete the DD Form 1057 in the required format within three 
working days after the cutoff of the reporting month (see 204.670-7 for 
alternate formats). Contracting offices are authorized to cut off the 
reporting month no earlier than the 25th calendar day. For September 
only, the cutoff date shall not be later than September 30. Submit the 
DD Form 1057 to the departmental data collection point in accordance 
with departmental/agency procedures.
    (3) Unless otherwise instructed by the departmental data collection 
point, do not submit revised DD Form 1057 reports. Include any required 
corrections or adjustments in following month's report.
[56 FR 36289, July 31, 1991, as amended at 61 FR 51030, Sept. 30, 1996]



204.670-4  Contract administration office responsibilities.

    Contract administration offices executing actions subject to DD Form 
350 or DD Form 1057 reporting must submit an annotated copy of the 
contractual instrument to the contracting office so that the contracting 
office can submit the required report.
    (a) For DD Form 350, annotate in the heading of the contractual 
instrument in large block letters ``DD FORM 350 REPORTING COPY.'' Send 
the annotated copy to the contracting office within one working day 
after the action date.
    (b) For DD Form 1057, annotate in the heading of the contractual 
instrument in large block letters ``DD FORM 1057 REPORTING COPY.'' Send 
the annotated copy with the normal distribution.



204.670-5  Departmental data collection point responsibilities.

    Departmental data collection points--
    (a) Collect DD Forms 350 and 1057 data provided by their contracting 
activities;
    (b) Electronically record the data in accordance with the 
instructions for recording and editing developed by WHS-DIOR with the 
majority agreement of the departments/agencies and prescribed by the 
Director of Defense Procurement; and
    (c) Submit monthly reports (noncumulative) to Washington 
Headquarters Services, ATTN: DIOR, within 18 days after the close of the 
reporting period, except the due date for September may be extended for 
no more than ten days. Reports control symbols, DD-P&L(M) 1014 and DD-
P&L(M) 1015, respectively, apply to reports submitted to WHS-DIOR for DD 
Form 350 actions and DD Form 1057.
[61 FR 51030, Sept. 30, 1996]



204.670-6  Types of DD Form 350 reports.

    There are three types of reports--single, consolidated, and 
multiple.
    (a) A single report is one DD Form 350 report per contracting 
action.
    (b) A consolidated report is one DD Form 350 report which combines 
several contracting actions.
    (1) Prepare consolidated reports for--
    (i) Air Mobility Command awards for international airlift services. 
The Command reports these at the end of each operating month with one DD 
Form 350 for each airlift contract.
    (ii) Military Sealift Command awards of indefinite delivery 
contracts for ocean transportation. The Command reports at the beginning 
of each fiscal year the estimated value of the orders for that fiscal 
year on one DD Form 350.
    (iii) Defense Fuel Supply Center or Defense Supply Center, Richmond, 
indefinite delivery contracts for petroleum or petroleum supplies. The 
Centers, at the time of award, report the estimated value of the orders 
to be placed against the contract on one DD Form 350.
    (iv) Orders placed by the Defense Commissary Agency (DeCA) for 
resale

[[Page 22]]

items in excess of $25,000. DeCA consolidates the orders monthly and 
reports the cumulative dollar amounts and actions on one DD Form 350 in 
accordance with departmental/agency procedures. Defense Logistics Agency 
activities submit single rather than consolidated reports.
    (v) Vouchers processed by the U.S. Army Contracting Command, Europe 
(USACCE), for the purchase of utilities from municipalities (e.g., gas, 
electricity, water, sewage, steam, snow removal, and garbage 
collection). USACCE consolidates these transactions monthly and reports 
the cumulative dollar amount on one DD Form 350 in accordance with 
departmental/agency procedures.
    (2) Consolidated reports may be prepared in accordance with 
departmental/agency procedures for orders under communications service 
agreements for local dial tone services.
    (c) A multiple report is more than one DD Form 350 per contracting 
action. Prepare multiple reports if--
    (1) The contracting action includes foreign military sales (FMS) 
requirements in addition to non-FMS requirements (Block B9 on the DD 
Form 350). Submit one DD Form 350 report for the FMS requirements and 
another DD Form 350 report for the non-FMS requirements, except if 
either of the portions in $25,000 or less, report the $25,000 or less 
portion on a DD Form 1057 in lieu of a DD Form 350.
    (2) The contracting action includes more than one type of contract 
(Block C5 on the DD Form 350) and the type with the least dollar value 
exceeds $500,000. Prepare a separate DD Form 350 for each contract type.
[56 FR 36289, July 31, 1991, as amended at 59 FR 27668, May 27, 1994; 60 
FR 61592, Nov. 30, 1995; 61 FR 51031, Sept. 30, 1996; 62 FR 49304, Sept. 
19, 1997]



204.670-7  Report formats.

    Contracting offices submit the signed original DD Forms 350 and 
1057, unless the data collection point approves use of an automated 
facsimile or electronic equivalent containing the information.



204.670-8  Security classification.

    Submit DD Forms 350 as unclassified documents. Classified contracts 
are not exempt from reporting solely because the contract is classified. 
Contact the appropriate departmental data collection points for special 
instructions if it is necessary for security reasons to modify coding of 
all or any individual blocks on the DD Form 350. If contact cannot be 
made for security reasons, obtain instructions from the Office of the 
Deputy to the Under Secretary of Defense for Policy Support, ATTN: 
Director for Special Programs. Telephone number is (703) 614-0578/9 or 
DSN 224-0578/9.
[61 FR 51031, Sept. 30, 1996]



204.670-9  Reporting of individual contracting actions of $25,000 or less.

    Under the Small Business Competitiveness Demonstration Program (see 
FAR subpart 19.10), contracting actions of $25,000 or less in four 
designated industry groups must be reported in the same manner as if the 
actions were in excess of $25,000.
    (a) Report contracting actions of $25,000 or less in the designated 
industry groups on both the DD Form 350 and the DD Form 1057.
    (b) The following contracting actions are not subject to the 
additional DD Form 350 reporting, although they must still be reported 
on the DD Form 1057:
    (1) Contracting actions of $500 or less.
    (2) Foreign military sales.
    (3) Orders or modifications under a Federal schedule.
    (4) Actions with a government agency.
    (5) Actions with non-U.S. business firms.
    (6) Actions where the place of performance is other than the United 
States and its outlying areas.
[56 FR 36289, July 31, 1991, as amended at 61 FR 51031, Sept. 30, 1996; 
62 FR 34121, June 24, 1997]



                      Subpart 204.8--Contract Files



204.802  Contract files.

    Official contract files shall consist of--
    (1) Only original, authenticated or conformed copies of contractual 
instruments--

[[Page 23]]

    (i) Authenticated copies means copies that are shown to be genuine 
in one of two ways--
    (A) Certification as true copy by signature of an authorized person; 
or
    (B) Official seal.
    (ii) Conformed copies means copies that are complete and accurate, 
including the date signed and the names and titles of the parties who 
signed them.
    (2) Signed or official record copies of correspondence, memoranda, 
and other documents.



204.804  Closeout of contract files.

    Normally, the closeout date for contract files is the date in Block 
9d on the DD Form 1594, Contract Completion Statement, or in columns 59-
65 on the PK9. If the contracting office must do a major closeout action 
that will take longer than three months after the date shown in Block 9d 
of the DD Form 1594, or in columns 59-65 of the PK9--
    (1) The closeout date for file purposes will be the date in Block 
10e of the DD Form 1594 or the date of the closeout statement executed 
when the MILSCAP PK9 is received.
    (2) The contracting office shall notify the contract administration 
office of the revised closeout date by either sending a copy of the 
completed DD Form 1594 or by preparing a MILSCAP Format Identifier PKZ, 
Contract Closeout Extension.



204.804-1  Closeout by the office administering the contract.

    (1) For contracting offices administering their own contracts, 
locally developed forms or statement of completion may be used instead 
of the DD Form 1594, Contract Completion Statement. Whichever method is 
used, the form shall be retained in the official contract file.
    (2) For contracts valued above the small purchase threshold, prepare 
a DD Form 1597, Contract Closeout Check List, (or agency equivalent) to 
ensure that all required contract actions have been satisfactorily 
accomplished.



204.804-2  Closeout of the contracting office files if another office administers the contract.

    (1) When an office, other than the contracting office, administers 
the contract, it shall--
    (i) Provide the contracting office an interim contract completion 
statement when the contract is physically completed and accepted. This 
notice may be in the form of either a DD Form 1594, Contract Completion 
Statement, or a MILSCAP Format Identifier Interim PK9, Contract Physical 
Completion. When the DD Form 1594 is used, the contracting officer--
    (A) Annotates Block 8, Remarks, with--
    (1) ``Notice of Physical Completion;''
    (2) Final acceptance date;
    (3) Signature of a responsible official; and
    (4) Date signed.
    (B) Does not complete Blocks 9 (b), (c), and (d) at this time;
    (ii) Prepare a DD Form 1597, Contract Closeout Check List, if 
necessary, to determine that all the required actions have been done;
    (iii) Initiate DD Form 1593, Contract Administration Completion 
Record, if necessary to obtain statements from other organizational 
elements that they have completed the actions they are responsible for; 
and
    (iv) Upon final payment--
    (A) Process the DD Form 1594 with Blocks 1 through 9 completed or 
the MILSCAP Format Identifier PK9 verifying that all contract 
administration office actions have been done; and
    (B) Send the original of the DD Form 1594 or the MILSCAP Format 
Identifier PK9 to the contracting office, and file a copy in the 
official contract file.
    (2) If the administrative contracting officer (ACO) cannot closeout 
a contract within the specified time period (see FAR 4.804-1), the ACO 
must notify the procuring contracting officer (PCO) within 45 days after 
the expiration of the time period of--
    (i) The reasons for the delay; and
    (ii) New target date for closeout. If MILSCAP procedures apply, the 
ACO

[[Page 24]]

shall use the MILSCAP Format Identifier PKX, Unclosed Contract Status, 
to provide this notice to the PCO.
    (3) If the contract still is not closed out by the new target date, 
the ACO shall again notify the PCO with the reasons for delay and new 
target date. If MILSCAP procedures apply, continue to use the MILSCAP 
Format Identifier PKX, Unclosed Contract Status, to provide this notice.



204.805  Disposal of contract files.

    (1) The sources of the period for which official contract files must 
be retained are General Records Schedule 3 (Procurement, Supply, and 
Grant Records) and General Records Schedule 6 (Accountable Officers' 
Accounts Records). Copies of the General Records Schedule may be 
obtained from the National Archives and Records Administration, 
Washington, DC 20408.
    (2) Deviations from the periods cannot be granted by the Defense 
Acquisition Regulatory Council. Forward requests for deviations to both 
the General Accounting Office and the National Archives and Records 
Administration.
    (3) Hold completed contract files in the office responsible for 
maintaining them for a period of 12 months after completion. After the 
initial 12 month period, send the records to the local records holding 
or staging area until they are eligible for destruction. If no space is 
available locally, transfer the files to the General Services 
Administration Federal Records Center that services the area.
    (4) Duplicate or working contract files should contain no originals 
of materials that properly belong in the official files. Destroy working 
files as soon as practicable once they are no longer needed.
    (5) Retain pricing review files, containing documents related to 
reviews of the contractor's price proposals, subject to cost or pricing 
data (see FAR 15.804-2), for six years. If it is impossible to determine 
the final payment date in order to measure the six year period, retain 
the files for nine years.
[56 FR 36289, July 31, 1991, as amended at 62 FR 40472, July 29, 1997]



  Subpart 204.9--Information Reporting to the Internal Revenue Service



204.902  General.

    (b) DoD uses the DD Form 350, Individual Contract Action Report, 
(see 204.670) to meet these reporting requirements.



  Subpart 204.70--Uniform Procurement Instrument Identification Numbers



204.7000  Scope.

    This subpart prescribes policies and procedures for assigning 
numbers to all solicitations, contracts, and related instruments. This 
subpart--
    (a) Does not apply to solicitations or contracts issued by the 
Defense Commercial Communications Office of the Defense Information 
Systems Agency; and
    (b) Is optional for solicitations and contracts that will be 
completely administered by the purchasing office or the consignee, 
except that--
    (1) The procurement instrument identification (PII) number, 
including supplemental modification numbers, shall not exceed 19 
characters (excluding hyphens); and
    (2) The number shall begin with the purchasing office identifier and 
the fiscal year in accordance with 204.7003(a) (1) and (2) and appendix 
G.
[56 FR 36289, July 31, 1991, as amended at 56 FR 67212, Dec. 30, 1991]



204.7001  Policy.

    (a) Use the uniform PII numbering system prescribed by this subpart 
for the solicitation/contract instruments described in 204.7003 and 
204.7004.
    (b) Retain the basic PII number unchanged for the life of the 
instrument.



204.7002  Procedures.

    (a) In assigning PII numbers--
    (1) Use only the alpha-numeric characters, as prescribed in this 
subpart; and
    (2) Do not use the letters ``I'' or ``O,'' except as noted in 
204.7003(a)(1)(i) (J) and (K).

[[Page 25]]

    (b) If department/agency procedures require other identification on 
the solicitation, contract, or other related instrument forms, enter it 
in such a location so as to separate it clearly from the PII number.
    (c) Enter the basic PII number, including Federal supply contract 
numbers and any supplementary numbers, in the spaces provided on the 
solicitation, contract, or related instrument forms. Separate the major 
elements by dashes, e.g., N00023-90-D-0009. If there is no space 
provided on the form, enter the number in the upper right corner of the 
form and identify what it is (e.g., Supplementary Number N00023-90-F-
0120).



204.7003  Basic PII number.

    (a) Elements of a number. The number consists of 13 alpha-numeric 
characters grouped to convey certain information.
    (1) Positions 1 through 6. The first of the six positions, in upper 
case letters, identify the department/agency and office issuing the 
instrument.
    (i) Department/agency identification:

                                                                        
                                                                        
                                                                        
(A) Department of the Army.................  DA                         
(B) Department of the Navy (except Marine    N                          
 Corps).                                                                
(C) Department of the Air Force............  F                          
(D) Defense Information Systems Agency.....  DCA                        
(E) Defense Logistics Agency...............  S                          
(F) Defense Special Weapons Agency.........  DSWA                       
(G) National Imagery and Mapping Agency....  NIMA                       
(H) Miscellaneous Defense Activities.......  MDA                        
(I) Marine Corps...........................  M                          
(J) Ballistic Missile Defense Organization.  HQ0006                     
(K) On Site Inspection Agency..............  OSIA                       
(L) Defense Commissary Agency..............  DECA                       
(M) United States Special Operations         USZA                       
 Command.                                                               
                                                                        
                                                                        

    (ii) Issuing office identification. The remaining positions are the 
alpha-numeric characters that identify the issuing office. These 
characters are in appendix G.
    (iii) Use all six positions. If necessary, enter zeros between the 
department/agency identifier and the issuing office identifier.
    (2) Positions 7 through 8. The seventh and eighth positions are the 
last two digits of the fiscal year in which the PII number was assigned.
    (3) Position 9. Indicate the type of instrument by entering one of 
the following upper case letters in position nine--

    (i) Blanket purchase agreements--A
    (ii) Invitations for bids--B
    (iii) Contracts of all types except indefinite delivery contracts, 
facilities contracts, sales contracts, and contracts placed with or 
through other Government departments or agencies or against contracts 
placed by such departments or agencies outside the DoD--C
    (iv) Indefinite delivery contracts--D
    (v) Facilities contracts--E
    (vi) Contracting actions placed with or through other Government 
departments or agencies or against contracts placed by such departments 
or agencies outside the DoD (including actions with the National 
Industries for the Blind (NIB), the National Industries for the Severely 
Handicapped (NISH), and the Federal Prison Industries (UNICOR))--F
    (vii) Basic ordering agreements--G
    (viii) Agreements, including basic agreements and loan agreements, 
but excluding basic purchasing agreements, basic ordering agreements, 
and leases--H
    (ix) Do not use--I
    (x) Reserved--J
    (xi) Short form research contract--K
    (xii) Lease agreement--L
    (xiii) Purchase orders--manual (assign W when numbering capacity of 
M is exhausted during the fiscal year)--M
    (xiv) Notice of intent to purchase--N
    (xv) Do not use--O
    (xvi) Purchase order--automated (assign V when numbering capacity of 
P is exhausted during a fiscal year)--P
    (xvii) Request for quotation--manual--Q
    (xviii) Request for proposal--R
    (xix) Sales contract--S
    (xx) Request for quotation--automated (assign U when numbering 
capacity of T is exhausted during a fiscal year)--T
    (xxi) See T--U
    (xxii) See P--V
    (xxiii) See M--W
    (xxiv) Reserved for departmental use--X

[[Page 26]]

    (xxv) Imprest fund--Y
    (xxvi) Reserved for departmental use--Z
    (4) Position 10 through 13. Enter the serial number of the 
instrument in these positions. A separate series of serial numbers may 
be used for any type of instrument listed in paragraph (a)(3) of this 
section. Activities shall assign such series of PII numbers 
sequentially. An activity may reserve blocks of numbers or alpha-numeric 
numbers for use by its various components.
    (b) Illustration of PII number. The following illustrates a properly 
configured PII number--

[[Page 27]]

[GRAPHIC] [TIFF OMITTED] TC01FE91.052


[56 FR 36289, July 31, 1991, as amended at 56 FR 67212, Dec. 30, 1991; 
59 FR 27668, May 27, 1994; 60 FR 61592, Nov. 30, 1995; 61 FR 50451, 
Sept. 26, 1996; 62 FR 34121, June 24, 1997]



204.7004  Supplementary PII numbers.

    (a) Uses of the supplementary number. Use supplementary numbers with 
the basic PII number, to identify--
    (1) Amendments to solicitations;
    (2) Modifications to contracts and agreements, including provisioned 
item orders; and
    (3) Calls or orders under contracts, basic ordering agreements, or 
blanket purchase agreements, issued by the contracting office or by a 
DoD activity other than the contracting office, including DoD orders 
against Federal supply schedules.
    (b) Amendments to solicitations. Number amendments to solicitations 
sequentially using a four position numeric serial number added to the 
basic PII number and beginning with 0001, e.g., N00062-91-R-1234-0001.
    (c) Modifications to contracts and agreements. (1) Number 
modifications to contracts and agreements using a six position alpha-
numeric added to the basic PII number.
    (2) Position 1. Identify the office issuing the modification--
    (i) Contract administration office--A
    (ii) Contracting office--P
    (3) Positions 2 through 3. These are the first two digits in a 
serial number. They may be either alpha or numeric. Use the letters K, 
L, M, N, P, Q, S, T, U, V, W, X, Y, or Z only in the second position and 
only in the following circumstances--
    (i) Use K, L, M, N, P, and Q in the second position only if the 
modification is issued by the Air Force and is a provisioned item order.
    (ii) Use S, and only S, in the second position to identify 
modifications issued to provide initial or amended shipping instructions 
when--
    (A) The contract has either FOB origin or destination delivery 
terms; and
    (B) The price changes.
    (iii) Use T, U, V, W, X, or Y, and only those characters, in the 
second position to identify modifications issued to provide initial or 
amended shipping instructions when--
    (A) The contract has FOB origin delivery terms; and
    (B) The price does not change.
    (iv) Only use Z in the second position to identify a modification 
which definitizes a letter contract.
    (4) Positions 4 through 6. These positions are always numeric. Use a 
separate series of serial numbers for each type of modification listed 
in paragraph (c)(3) of this section. Examples of proper numbering for 
positions 2-6 (the first position will be either ``A'' or ``P'') are as 
follows:

[[Page 28]]



                                                                        
------------------------------------------------------------------------
                                  Provisioned items                     
                                 order (reserved for       Shipping     
      Normal modification          exclusive use by      instructions   
                                 the Air Force only)                    
------------------------------------------------------------------------
00001-99999....................  K0001-K9999          S0001-S9999       
  then.........................  KA001-KZ999          SA001-SZ999       
A0001-A9999....................  L0001-L9999          T0001-T9999       
B0001-B9999....................  LA001-LZ999          TA001-TZ999       
  and so on to.................  M0001-M9999          U0001-U9999       
H0001-H9999....................  MA001-MZ999          UA001-UZ999       
  then.........................  N0001-N9999          V0001-V9999       
J0001-J9999....................  NA001-NZ999          VA001-VZ999       
  then.........................  P0001-P9999          W0001-W9999       
R0001-R9999....................  PA001-PZ999          WA001-WZ999       
  then.........................  Q0001-Q9999          X0001-X9999       
AA001-HZ999....................  QA001-QZ999          XA001-XZ999       
  then.........................                       Y0001-Y9999       
JA001-JZ999....................                       YA001-YZ999       
RA001-RZ999....................                                         
------------------------------------------------------------------------

    (5) If the contract administration office is changing the contract 
administration or disbursement office for the first time and is using 
computer generated modifications to notify many offices, it uses the six 
position supplementary number ARZ999. If either office has to be changed 
again during the life of the contract, the supplementary number will be 
ARZ998, and on down as needed.
    (6) Each office authorized to issue modifications shall assign the 
supplementary identification numbers in sequence. Do not assign the 
numbers until it has been determined that a modification is to be 
issued.
    (d) Delivery orders under indefinite delivery contracts, orders 
under basic ordering agreements, and calls under blanket purchase 
agreements. (1) Calls or orders issued by the office issuing the 
contract or agreement. Use a four position alpha-numeric call or order 
serial number added to the basic PII number. These shall be identified 
by using serial numbers beginning 0001 through 9999. When the numeric 
identifiers run out, use alpha characters in the third and fourth 
positions. Never use alpha characters in the first and second positions.
    (2) Orders placed against another activity's contract or agreement.
    (i) If the office placing the order or call is different from the 
office identified in the basic PII number, assign a serial number to the 
order or call. The first and second positions contain the call/order 
code assigned to the ordering office by appendix G. Do not use the 
letters A or P in the first position. The third and fourth positions are 
a two position serial number assigned by the ordering office. The series 
will begin with 01. When the numbers exceed 99, the office will assign a 
uniform series of identifiers containing alpha and/or numeric 
characters, e.g., Basic : N00383-91-D-0001 serial : TU01.
    (ii) If an office is placing calls or orders with NIB, NISH, or 
UNICOR, the office shall identify the instrument with a 13 position 
supplementary PII number using an F in the 9th position. Modifications 
to these calls or orders shall be numbered in accordance with paragraph 
(c) of this section, e.g., Order : DLA100-91-F-0001 modification : 
A00001.
    (e) Modifications to calls or orders. Use a two position alpha-
numeric suffix, known as a call or order modification indicator, to 
identify a modification to a call or order.
    (1) Modifications to a call or order issued by a purchasing office 
begin with 01, 02, and so on through 99, then B1 through B9, BA through 
BZ, C1 through C9, and so on through ZZ.
    (2) Modifications to a call or order issued by a contract 
administration office begin with 1A, 1B, and so on through 9Z, followed 
by A1, A2, and so on to A9, then AA, AB, and so on through AZ.



       Subpart 204.71--Uniform Contract Line Item Numbering System



204.7100  Scope.

    This subpart prescribes policies and procedures for assigning 
contract line item numbers.



204.7101  Definitions.

    Accounting classification reference number (ACRN) means a two 
position alpha or alpha/numeric control code used as a method of 
relating the accounting classification citation to detailed line item 
information contained in the schedule.
    Attachment means any documentation, appended to a contract or 
incorporated by reference, which does not establish a requirement for 
deliverables.
    Definitized item, as used in this subpart, means an item for which a 
firm

[[Page 29]]

price has been established in the basic contract or by modification.
    Exhibit means a document, referred to in a contract, which is 
attached and establishes requirements for deliverables. The term shall 
not be used to refer to any other kind of attachment to a contract. The 
DD Form 1423, Contract Data Requirements List, is always an exhibit, 
rather than an attachment.
    Nonseverable deliverable, as used in this subpart, means a 
deliverable item that is a single end product or undertaking, entire in 
nature, that cannot be feasibly subdivided into discrete elements or 
phases without losing its identity.
    Undefinitized item, as used in this subpart, means an item for which 
a price has not been established in the basic contract or by 
modification.
[56 FR 36289, July 31, 1991, as amended at 60 FR 34468, July 3, 1995]



204.7102  Policy.

    (a) The numbering procedures of this subpart shall apply to all--
    (1) Solicitations;
    (2) Solicitation line and subline item numbers, if practicable;
    (3) Contracts as defined in FAR Subpart 2.1;
    (4) Contract line and subline item numbers;
    (5) Exhibits;
    (6) Exhibit line and subline items; and
    (7) Any other document expected to become part of the contract.
    (b) The numbering procedures are mandatory for all contracts where 
separate contract line item numbers are assigned, unless--
    (1) There are no postaward contract administration functions that 
the contracting officer will assign to an office listed in the DoD 
Directory of Contract Administration Services Components;
    (2) The contract is an indefinite delivery type for petroleum 
products against which posts, camps, and stations issue delivery orders 
for products to be consumed by them; or
    (3) The contract is a communications service authorization issued by 
the Defense Information Systems Agency's Office of Defense Commercial 
Communications.
[56 FR 36289, July 31, 1991, as amended at 56 FR 67212, Dec. 30, 1991; 
60 FR 34468, July 3, 1995]



204.7103  Contract line items.



204.7103-1  Criteria for establishing.

    Contracts shall identify the items or services to be acquired as 
separate contract line items unless it is not feasible to do so.
    (a) Contract line items shall have all four of the following 
characteristics; however, there are exceptions within the 
characteristics, which may make establishing a separate contract line 
item appropriate even though one of the characteristics appears to be 
missing--
    (1) Single unit price. The item shall have a single unit price or a 
single total price, except--
    (i) If the item is not separately priced (NSP) but the price is 
included in the unit price of another contract line item, enter NSP 
instead of the unit price;
    (ii) When there are associated subline items, established for other 
than informational reasons, and those subline items are priced in 
accordance with 204.7104;
    (iii) When the items or services are being acquired on a cost-
reimbursement contract;
    (iv) When the contract is for maintenance and repair services (e.g., 
a labor hour contract) and firm prices have been established for 
elements of the total price of an item but the actual number and 
quantity of the elements are not known until performance. The 
contracting officer may structure these contracts to reflect a firm or 
estimated total amount for each line item;
    (v) When the contract line item is established to refer to an 
exhibit or an attachment (if management needs dictate that a unit price 
be entered, the price shall be set forth in the item description block 
and enclosed in parentheses); or
    (vi) When the contract is an indefinite delivery type contract and 
provides that the price of an item shall be determined at the time a 
delivery

[[Page 30]]

order is placed and the price is influenced by such factors as the 
quantity ordered (e.g., 10-99 @ $1.00, 100-249 @ $.98, 250+ @ $.95), the 
destination, the FOB point, or the type of packaging required.
    (2) Separately identifiable. A contract line item must be identified 
separately from any other items or services on the contract.
    (i) Supplies are separately identifiable if they have no more than 
one--
    (A) National stock number (NSN);
    (B) Item description; or
    (C) Manufacturer's part number.
    (ii) Services are separately identifiable if they have no more than 
one--
    (A) Scope of work; or
    (B) Description of services.
    (iii) This requirement does not apply if there are associated 
subline items, established for other than informational reasons, and 
those subline items include the actual detailed identification in 
accordance with 204.7104. Where this exception applies, use a general 
narrative description instead of the contract item description.
    (3) Separate delivery schedule. Each contract line item or service 
shall have its own delivery schedule, period of performance, or 
completion date expressly stated (``as required'' constitutes an 
expressly stated delivery term).
    (i) The fact that there is more than one delivery date, destination, 
performance date, or performance point may be a determining factor in 
the decision as to whether to establish more than one contract line 
item.
    (ii) If a contract line item has more than one destination or 
delivery date, the contracting officer may create individual contract 
line items for the different destinations or delivery dates, or may 
specify the different delivery dates for the units by destination in the 
delivery schedule.
    (4) Single accounting classification citation. (i) Each contract 
line item shall reference a single accounting classification citation 
except as provided in paragraph (a)(4)(ii) of this subsection.
    (ii) The use of multiple accounting classification citations for a 
contract line item is authorized in the following situations:
    (A) A single, nonseverable deliverable to be paid for with R&D or 
other funds properly incrementally obligated over several fiscal years 
in accordance with DoD policy;
    (B) A single, nonseverable deliverable to be paid for with different 
authorizations or appropriations, such as in the acquisition of a 
satellite or the modification of production tooling used to produce 
items being acquired by several activities; or
    (C) A modification to an existing contract line item for a 
nonseverable deliverable that results in the delivery of a modified 
item(s) where the item(s) and modification are to be paid for with 
different accounting classification citations.
    (iii) When the use of multiple accounting classification citations 
is authorized for a single contract line item, establish informational 
subline items for each accounting classification citation in accordance 
with 204.7104-1(a).
    (b) Exhibits may be used as an alternative to putting a long list of 
contract line items in the schedule. If exhibits are used, create a 
contract line item citing the exhibit's identifier. See 204.7105(a).
    (c) If the contract involves a test model or a first article which 
must be approved, establish a separate contract line item or subline 
item for each item of supply or service which must be approved. If the 
test model or first article consists of a lot composed of a mixture of 
items, a single line item or subline item may be used for the lot.
    (d) If a supply or service involves ancillary functions, like 
packaging and handling, transportation, payment of state or local taxes, 
or use of reusable containers, and these functions are normally 
performed by the contractor and the contractor is normally entitled to 
reimbursement for performing these functions, do not establish a 
separate contract line item solely to account for these functions. 
However, do identify the functions in the contract schedule. If the 
offeror separately prices these functions, contracting officers may 
establish separate contract line items for the functions; however, the 
separate

[[Page 31]]

line items must conform to the requirements of paragraph (a) of this 
subsection.
[56 FR 36289, July 31, 1991, as amended at 60 FR 34468, July 3, 1995; 60 
FR 43191, Aug. 18, 1995]



204.7103-2  Numbering procedures.

    (a) Contract line items shall consist of four numeric digits 0001 
through 9999. Do not use numbers beyond 9999. Within a given contract, 
the item numbers shall be sequential but need not be consecutive.
    (b) The contract line item number shall be the same as the 
solicitation line item number unless there is a valid reason for using 
different numbers.
    (c) Once a contract line item number has been assigned, it shall not 
be assigned to another, different, contract line item in the same 
contract.



204.7104  Contract subline items.



204.7104-1  Criteria for establishing.

    Contract subline items provide flexibility to further identify 
elements within a contract line item for tracking performance or 
simplifying administration. There are only two kinds of subline items: 
those which are informational in nature and those which consist of more 
than one item that requires separate identification.
    (a) Informational subline items. (1) This type of subline item 
identifies information that relates directly to the contract line item 
and is an integral part of it (e.g., parts of an assembly or parts of a 
kit). These subline items shall not be scheduled separately for 
delivery, identified separately for shipment or performance, or priced 
separately for payment purposes.
    (2) The informational subline item may include quantities, prices, 
or amounts, if necessary to satisfy management requirements. However, 
these elements shall be included within the item description in the 
supplies/services column and enclosed in parentheses to prevent 
confusing them with quantities, prices, or amounts that have contractual 
significance. Do not enter these elements in the quantity and price 
columns.
    (3) Informational subline items shall be used to identify each 
accounting classification citation assigned to a single contract line 
item number when use of multiple citations is authorized (see 204.7103-
1(a)(4)(ii)).
    (b) Separately identified subline items. (1) Subline items will be 
used instead of contract line items to facilitate payment, delivery 
tracking, contract funds accounting, or other management purposes. Such 
subline items shall be used when items bought under one contract line 
item number--
    (i) Are to be paid for from more than one accounting classification. 
A subline item shall be established for the quantity associated with the 
single accounting classification citation. Establish a line item rather 
than a subline item if it is likely that a subline item may be assigned 
additional accounting classification citations at a later date. Identify 
the funding as described in 204.7104-1(a)(3);
    (ii) Are to be packaged in different sizes, each represented by its 
own NSN;
    (iii) Have collateral costs, such as packaging costs, but those 
costs are not a part of the unit price of the contract line item;
    (iv) Have different delivery dates or destinations or requisitions, 
or a combination of the three; or
    (v) Identify parts of an assembly or kit which--
    (A) Have to be separately identified at the time of shipment or 
performance; and
    (B) Are separately priced.
    (2) Each separately identified contract subline item shall have its 
own--
    (i) Delivery schedule, period of performance, or completion date;
    (ii) Unit price or single total price or amount (not separately 
priced (NSP) is acceptable as an entry for price or amount if the price 
is included in another subline item or a different contract line item). 
This requirement does not apply--
    (A) If the subline item was created to refer to an exhibit or an 
attachment. If management needs dictate that a unit price be entered, 
the price shall be set forth in the item description block of the 
schedule and enclosed in parentheses; or

[[Page 32]]

    (B) In the case of indefinite delivery contracts described at 
204.7103-1(a)(1)(vi).
    (iii) Identification (e.g., NSN, item description, manufacturer's 
part number, scope of work, description of services).
    (3) Unit prices and extended amounts.
    (i) The unit price and total amount for all subline items may be 
entered at the contract line item number level if the unit price for the 
subline items is identical. If there is any variation, the subline item 
unit prices shall be entered at the subline item level only.
    (ii) The unit price and extended amounts may be entered at the 
subline items level.
    (iii) The two methods in paragraphs (b)(3) (i) and (ii) of this 
subsection shall not be combined in a contract line item.
    (iv) When the price for items not separately priced is included in 
the price of another subline item or contract line item, it may be 
necessary to withhold payment on the priced subline item until all the 
related subline items that are not separately priced have been 
delivered. In those cases, use the clause at 252.204-7002, Payment for 
Subline Items Not Separately Priced.
[56 FR 36289, July 31, 1991, as amended at 60 FR 34468, July 3, 1995]



204.7104-2  Numbering procedures.

    (a) Number subline items by adding either two numeric characters or 
two alpha characters to the basic contract line item number.
    (1) Information subline item numbers. Use numeric characters only 
for information subline items, running 01 through 99. Do not use spaces 
or special characters to separate the subline item number from the 
contract line item number that is its root. For example, if the contract 
line item number is 0001, the first three subline items would be 000101, 
000102, and 000103. Do not use a designation more than once within a 
contract line item.
    (2) Separately identified subline items. Use alpha characters only 
for separately identified subline items, running AA through ZZ. Do not 
use spaces or special characters to separate the subline item number 
from the contract line item number that is its root. For example, if the 
contract line item number is 0001, the first three subline items would 
be 0001AA, 0001AB, and 0001AC.
    (i) Do not use the letters I or O as alpha characters.
    (ii) Use all 24 available alpha characters in the second position 
before selecting a different alpha character for the first position. For 
example, AA, AB, AC, through AZ before beginning BA, BB, and BC.
    (b) Within a given contract line item, the subline item numbers 
shall be sequential but need not be consecutive.
    (c) Exhibits may be used as an alternative to setting forth in the 
schedule a long list of contract subline items. If exhibits are used, 
create a contract subline item citing the exhibit's identifier. See 
204.7105.
    (d) If a contract line item involves ancillary functions, like 
packaging and handling, transportation, payment of state or local taxes, 
or use of reusable containers, and these functions are normally 
performed by the contractor and the contractor is normally entitled to 
reimbursement for performing these functions, do not establish a 
separate subline item solely to account for these functions. However, do 
identify the functions in the contract schedule. If offeror separately 
prices these functions, then contracting officers may establish separate 
subline items for the functions; however, the separate subline items 
must conform to the requirements of 204.7104-1.
    (e) The following examples illustrate subline items numbering--
    (1) Subline items structured to identify destinations for identical 
items, identically priced (delivery schedule shall be established for 
each subline item, not the contract line item).

----------------------------------------------------------------------------------------------------------------
         Item No.                Supplies/service         Quantity          Unit         Unit price     Amount  
----------------------------------------------------------------------------------------------------------------
0001                       NSN 1615-00-591-6620 Shim,   ...........                     ...........  ...........
                            Aluminum Alloy, Apbl,                                                               
                            Rotor, Helicopter PRON A1-                                                          
                            9-63821-M1-M1 ACRN:AA.                                                              
0001AA                     A3168R-9030-4025 A2537M               10  EA                     $100.00    $1,000.00
                            IPD: 2 RDD: 334 PROJ: 501.                                                          

[[Page 33]]

                                                                                                                
0001AB                     A3168R-9030-4026 A51AXBM              10  EA                     $100.00    $1,000.00
                            IPD: 2 RDD: 325 PROJ: 502.                                                          
0001AC                     A3168R-9030-4027 A67KBCM              15  EA                     $100.00    $1,500.00
                            IPD: 2 RDD: 349 PROJ: 503.                                                          
----------------------------------------------------------------------------------------------------------------

    (2) Subline items structured to identify destinations for identical 
items, not identically priced (delivery schedule shall be established 
for each subline item, not the contract line item).

----------------------------------------------------------------------------------------------------------------
         Item No.                Supplies/service         Quantity          Unit         Unit price     Amount  
----------------------------------------------------------------------------------------------------------------
0001                       NSN 1615-00-591-6620 Shim,   ...........                     ...........  ...........
                            Aluminum Alloy, Apbl,                                                               
                            Rotor, Helicopter PRON A1-                                                          
                            9-63821-M1-M1 ACRN:AA.                                                              
0001AA                     A3168R-9030-4025 A2537M               10  EA                     $100.00    $1,000.00
                            IPD: 2 RDD: 334 PROJ: 501.                                                          
0001AB                     A3168R-9030-4026 A51AXBM              20  EA                      $99.00    $1,980.00
                            IPD: 2 RDD: 325 PROJ: 502.                                                          
0001AC                     A3168R-9030-4027 A67KBCM              30  EA                      $98.00    $2,940.09
                            IPD: 2 RDD: 349 PROJ: 503.                                                          
----------------------------------------------------------------------------------------------------------------
Note: Difference in prices for identical items is due to separate destinations for FOB destination delivery.    

    (3) Subline items structured to identify different sizes of an item 
that are identically priced (delivery schedule shall be established for 
each subline item, not the contract line item).

----------------------------------------------------------------------------------------------------------------
         Item No.                Supplies/service         Quantity          Unit         Unit price     Amount  
----------------------------------------------------------------------------------------------------------------
0013                       Boots Insulated, Cold        ...........  PR                      $38.35   $13,422.50
                            Weather White, Type II,                                                             
                            Class 1.                                                                            
0013AA                     8430-00-655-5541 Size 5N...           50                     ...........  ...........
0013AB                     8430-00-655-5544 Size 8N...           70                     ...........  ...........
0013AC                     8430-00-655-5551 Size 9N...           30                     ...........  ...........
0013AD                     8430-00-655-5535 Size 9R...          200                     ...........  ...........
----------------------------------------------------------------------------------------------------------------
Note: Unit price and total amount shown at line item level rather than at subline item level.                   

    (4) Subline items structured to identify different sizes of an item 
that are not identically priced (delivery schedule shall be established 
for each subline item, not the contract line item).

----------------------------------------------------------------------------------------------------------------
         Item No.                Supplies/service         Quantity          Unit         Unit price     Amount  
----------------------------------------------------------------------------------------------------------------
0002                       Body Armor Ground Troops     ...........                     ...........  ...........
                            Variable Type Small Arms,                                                           
                            Fragmentation Protective                                                            
                            Nylon Felt Vest, Front and                                                          
                            Back Plates, Ceramic                                                                
                            Plate, Type I.                                                                      
0002AA                     First Article..............            1  LO                         NSP  ...........
0002AB                     8470-00-141-0935, Medium            1936  SE                     $331.77  $642,306.72
                            Regular.                                                                            
0002AC                     8470-00-141-0936, Large              625  SE                      355.77   222,356.25
                            Regular.                                                                            
0002AD                     8470-00-141-0937, Medium            1237  SE                      346.77   428,954.49
                            Long.                                                                               
0002AE                     8470-00-141-0938, Large              804  SE                      365.77   294,079.08
                            Long.                                                                               
----------------------------------------------------------------------------------------------------------------

    (5) Subline items structured to provide the capability for relating 
subordinate separately priced packaging costs to the overall contract 
line item. (Separate delivery schedules shall be established for the 
subline item identifying the contractor's product and for the subline 
item identifying packaging. No schedule will be established for the 
contract line item.)

----------------------------------------------------------------------------------------------------------------
        Item No.              Supplies/service        Quantity         Unit         Unit price        Amount    
----------------------------------------------------------------------------------------------------------------
0001                      6105-00-635-6568 50380                                                                
                          Ref No 63504-WZ Armature                                                              

[[Page 34]]

                                                                                                                
0001AA                    6105-00-635-6568 50380              2  Ea.............       $2,895.87       $5,791.74
                          Ref No 63504-WZ Armature                                                              
                           Motor ACRN:AA.                                                                       
0001AB                    Packaging ACRN:AA.......            2  Ea.............         $289.58         $579.16
----------------------------------------------------------------------------------------------------------------

    (6) Subline items structured to identify different accounting 
classifications for identical items (delivery schedule shall be 
established for each subline item, not the contract line item).
AJ: 17X150518350315069100000192B000000000000000000
AK: 17X150518370317569100000192B000000000000000000
AL: 17X150519350314369100000192B000000000000000000

----------------------------------------------------------------------------------------------------------------
         Item no.                Supplies/service         Quantity          Unit         Unit price     Amount  
----------------------------------------------------------------------------------------------------------------
0002                       Pulse Decoder, KY-312/A5Q-   ...........  EA                   $3,037.40             
                            19.                                                                                 
0002AA                     Pulse Decoder, KY-312/A5Q-             2                     ...........     6,074.80
                            19 ACRN: AJ.                                                                        
0002AB                     Pulse Decoder, K1Y-312/A5Q-            6                     ...........    18,224.40
                            19 ACRN: AK.                                                                        
0002AC                     Pulse Decoder, KY-312/A5Q-             2                     ...........   $6,074.80 
                            19 ACRN: AL.                                                                        
----------------------------------------------------------------------------------------------------------------
Note: Unit price may be shown at line item level and total amounts shown at subline item level.                 

    (7) Informational subline items established to identify multiple 
accounting classification citations assigned to a single contract line 
item.

----------------------------------------------------------------------------------------------------------------
         Item No.                Supplies/service         Quantity          Unit         Unit price     Amount  
----------------------------------------------------------------------------------------------------------------
0001                       Air Vehicle................            1  Ea                  $6,700,000   $6,700,000
000101                     ACRN:AA $3,300,000                                                                   
000102                     ACRN:AB $2,000,000                                                                   
000103                     ACRN:AC $1,400,000                                                                   
----------------------------------------------------------------------------------------------------------------

    (8) Subline items structured to identify parts of an assembly 
(delivery schedule and price shall be established for each identified 
part at the subline item level, not for the assembly at the contract 
line item level).

----------------------------------------------------------------------------------------------------------------
         Item no.                Supplies/service         Quantity          Unit         Unit price     Amount  
----------------------------------------------------------------------------------------------------------------
0003                       Automatic Degausing System   ...........                     ...........  ...........
                            Consisting of: (2 ea @                                                              
                            $52,061; $104,122 total).                                                           
0003AA                     Switchboard................            2  EA                  $52,061.00  $104,122.00
0003AB                     Remote Control Panel.......            2  EA                         NSP  ...........
0003AC                     Power Supply (M Coil) SSM              2  EA                         NSP  ...........
                            Type 145 Amps, 220 V DC).                                                           
0003AF                     Power Supply (A Coil) SSM              2  EA                         NSP  ...........
                            Type (118 Amps, 220 V DC).                                                          
----------------------------------------------------------------------------------------------------------------

    (9) Subline items structured to identify parts of a kit (delivery 
schedule and price shall be established for each identified part at the 
subline item level, not for the kit at the contract line item level).

----------------------------------------------------------------------------------------------------------------
         Item no.                Supplies/service         Quantity          Unit         Unit price     Amount  
----------------------------------------------------------------------------------------------------------------
0031                       Conversion Kit to Convert    ...........                     ...........  ...........
                            Torpedo MK 45 Mod 0 to                                                              
                            Torpedo MK 45 Mod 1, (50                                                            
                            Kt @ $10,868.52; $543,426                                                           
                            total).                                                                             
0031AA                     Integrator Assy LD 620106..           50  EA                  $10,868.52  $543,426.00
0031AB                     Pulse Generator Assy LD               50  EA                         NSP  ...........
                            587569.                                                                             
0031AC                     Drive Shaft Assy LD 587559.           50  EA                         NSP  ...........
0031BF                     Actual Panel Assy LD 542924           50  EA                         NSP  ...........
----------------------------------------------------------------------------------------------------------------
Note: In this example, the prices of subline items 0031AB through 0031BF are included in the Integrator         
  Assembly.                                                                                                     


[[Page 35]]

[56 FR 36289, July 31, 1991, as amended at 60 FR 34468, July 3, 1995]



204.7105  Contract exhibits and attachments.

    (a) Use of exhibits. (1) Exhibits may be used instead of putting a 
long list of contract line items or subline items in the contract 
schedule. Exhibits are particularly useful in buying spare parts.
    (2) When using exhibits, establish a contract line or subline item 
and refer to the exhibit.
    (3) Identify exhibits individually.
    (4) Each exhibit shall apply to only one contract line item or 
subline item, except--
    (i) One exhibit may apply to one or more option line item(s) when 
the data required under the exhibits is identical in all respects except 
the period during which the option is to be exercised; and
    (ii) An exhibit may apply to more than one contract line item if the 
exhibit is not separately priced and the exhibit deliverable is 
identical for all applicable contract line items.
    (5) More than one exhibit may apply to a single contract line item.
    (6) Data items on a DD Form 1423, Contract Data Requirements List, 
may be either separately priced or not separately priced.
    (i) Separately priced. When data are separately priced, enter the 
price in only one place in the contract: in either Section B of the 
contract schedule or on the DD Form 1423. Whichever place, display the 
price there consistently.
    (A) Section B. If the prices are entered in section B of the 
schedule, detach Blocks 17 and 18 of the DD Form 1423 and file elsewhere 
in the contract file. If the prices are entered on the DD Form 1423, do 
not detach Blocks 17 and 18 of the DD Form 1423.
    (B) DD Form 1423. If the prices are entered on the DD Form 1423, the 
price of all separately priced deliverable data items attributable to a 
line item shall be totalled and included, for information purposes, in 
parentheses, below the supplies services for that line item, in section 
B of the schedule.
    (ii) NSP. Include prices in a priced contract line item or subline 
item. Detach Blocks 17 and 18 of the DD Form 1423 and retain them 
elsewhere as required.
    (7) The contracting officer may append attachments to exhibits, as 
long as the attachment does not identify a deliverable requirement which 
has not been established by a contract or exhibit line or subline item.
    (b) Numbering exhibits and attachments. (1) Use alpha characters to 
identify exhibits. The alpha characters shall be either single or double 
capital letters. Do not use the letters I or O.
    (2) Exhibit identifiers need not be either consecutive or 
sequential.
    (3) Once an identifier has been assigned to an exhibit, do not use 
it on another exhibit in the same contract.
    (4) The identifier shall always appear in the first or first and 
second positions of all applicable exhibit line item numbers.
    (5) If the exhibit has more than one page, cite the procurement 
instrument identification number, exhibit identifier, and applicable 
contract line or subline item number on each page.
    (6) Use numbers to identify attachments.
    (c) Numbering exhibit line items and subline items--(1) Criteria for 
establishing. The criteria for establishing exhibit line items and 
subline items is the same as those for establishing contract line items 
and subline items (see 204.7103 and 204.7104, respectively).
    (2) Procedures for numbering. (i) Number items in an exhibit in a 
manner similar to contract line items and subline items.
    (ii) Number line items using a four position number.
    (A) The first position or the first and second position contain the 
exhibit identifier.
    (B) The third and fourth positions contain the alpha or numeric 
character serial numbers assigned to the line item.
    (iii) Assign alpha or numeric characters to the line item on the 
basis of the same criteria outlined in contract subline items at 
204.7104.
    (iv) Exhibit line item numbers shall be sequential within the 
exhibit.
    (3) Examples--(i) Two position serial number for double letter 
exhibit identifier.

[[Page 36]]



                                                                        
------------------------------------------------------------------------
    Cumulative No. of line items            Serial number sequence      
------------------------------------------------------------------------
1-33................................  01 thru 09, then OA thru OZ, then 
34-67...............................  10 thru 19, then 1A thru 1Z, then 
68-101..............................  20 thru 29, then 2A thru 2Z, then 
102-135.............................  30 thru 39, then 3A thru 3Z, then 
136-169.............................  40 thru 49, then 4A thru 4Z, then 
170-203.............................  50 thru 59, then 5A thru 5Z, then 
204-237.............................  60 thru 69, then 6A thru 6Z, then 
238-271.............................  70 thru 79, then 7A thru 7Z, then 
272-305.............................  80 thru 89, then 8A thru 8Z, then 
306-339.............................  90 thru 99, then 9A thru 9Z, then 
340-373.............................  A0 thru A9, then AA thru AZ, then 
374-407.............................  B0 thru B9, then BA thru BZ, then 
408-441.............................  C0 thru C9, then CA thru CZ, then 
442-475.............................  D0 thru D9, then DA thru DZ, then 
476-509.............................  E0 thru E9, then EA thru EZ, then 
510-543.............................  F0 thru F9, then FA thru FZ, then 
544-577.............................  G0 thru G9, then GA thru GZ, then 
578-611.............................  H0 thru H9, then HA thru HZ, then 
612-645.............................  J0 thru J9, then JA thru JZ, then 
646-679.............................  K0 thru K9, then KA thru KZ, then 
680-713.............................  L0 thru L9, then LA thru LZ, then 
714-747.............................  M0 thru M9, then MA thru MZ, then 
748-781.............................  N0 thru N9, then NA thru NZ, then 
782-815.............................  P0 thru P9, then PA thru PZ, then 
816-849.............................  Q0 thru Q9, then QA thru QZ, then 
850-883.............................  R0 thru R9, then RA thru RZ, then 
884-917.............................  S0 thru S9, then SA thru SZ, then 
918-951.............................  T0 thru T9, then TA thru TZ, then 
952-985.............................  U0 thru U9, then UA thru UZ, then 
986-1019............................  V0 thru V9, then VA thru VZ, then 
1020-1053...........................  W0 thru W9, then WA thru WZ, then 
1054-1087...........................  X0 thru X9, then XA thru XZ, then 
1088-1121...........................  Y0 thru Y9, then YA thru YZ, then 
1122-1155...........................  Z0 thru Z9, then ZA thru ZZ       
------------------------------------------------------------------------

    (ii) Three position numbers.

                                                                        
------------------------------------------------------------------------
    Cumulative No. of line items            Serial number sequence      
------------------------------------------------------------------------
(ii) Three position numbers.                                            
1-33................................  001 thru 009, then 00A thru 00Z,  
                                       then                             
34-67...............................  010 thru 019, then 01A thru 101Z, 
                                       then                             
68-101..............................  020 thru 029, then 02A thru 02Z,  
                                       then                             
102-135.............................  030 thru 039, then 03A thru 03Z   
                                       and so                           
136-305.............................  on to                             
306-339.............................  090 thru 099, then 09A thru 09Z,  
                                       then                             
340-373.............................  0A0 thru 0A9, then 0AA thru 0AZ,  
                                       then                             
374-407.............................  0B0 thru 0B9, then 0BB thru 0BZ,  
                                       then                             
408-441.............................  0C0 thru 0C9, then 0CA thru 0CZ,  
                                       and                              
442-1121............................  so on to                          
1122-1155...........................  0Z0 thru 0Z9, then 0ZA thru 0ZZ,  
                                       then                             
1156-1189...........................  100 thru 109, then 10A thru 10Z,  
                                       then                             
1190-1223...........................  110 thru 119, then 11A thru 11Z,  
                                       then                             
1224-1257...........................  120 thru 129, then 12A thru 12Z,  
                                       and                              
1258-1461...........................  so on to                          
1462-1495...........................  190 thru 199, then 19A thru 19Z,  
                                       then                             
1496-1529...........................  1A0 thru 1A9, then 1AA thru 1AZ,  
                                       then                             
1530-1563...........................  1B0 thru 1B9, then 1BA thru 1BZ,  
                                       and                              
1564-2277...........................  so on to                          
2278-2311...........................  1Z0 thru 1Z9, then 1ZA thru 1ZB,  
                                       then                             
2312-2345...........................  200 thru 109, then 10A thru 10Z,  
                                       then                             
2346-2379...........................  210 thru 219, then 21A thru 21Z,  
                                       then                             
2380-2413...........................  220 thru 229, then 22A thru 22Z,  
                                       and                              
2414-2617...........................  so on to                          
2618-2651...........................  290 thru 299, then 29A thru 29Z,  
                                       then                             
2652-2685...........................  2A0 thru 2A9, then 2AA thru 2AZ,  
                                       then                             
2686-2719...........................  2B0 thru 2B9, then 2BA thru 2BZ,  
                                       and                              
2720-3433...........................  so on to                          
3434-3467...........................  2Z0 thru 2Z9, then 2ZA thru 2ZZ,  
                                       then                             
3468-3501...........................  300 thru 309, then 30Z thru 30Z,  
                                       and                              
3502-10403..........................  so on to                          
10404-10437.........................  900 thru 909, then 90A thru 90Z,  
                                       then                             
10438-10471.........................  910 thru 919, then 91A thru 91Z,  
                                       and                              
10472-10709.........................  so on to                          
10710-10743.........................  990 thru 999, then 99A thru 99Z,  
                                       then                             
10744-10777.........................  9A0 thru 9A9, then 9AA thru 9AZ,  
                                       then                             
10778-10811.........................  9B0 thru 9B9, then 9BA thru 9BZ,  
                                       and                              
10812-11525.........................  so on to                          
11526-11559.........................  9Z0 thru 9Z9, then 9ZA thru 9ZZ   
------------------------------------------------------------------------



204.7106  Contract modifications.

    (a) If new items are added, assign new contract line or subline item 
numbers or exhibit line item numbers, in accordance with the procedures 
established at 204.7103, 204.7104, and 204.7105.
    (b) Modifications to existing contract line items or exhibit line 
items. (1) If the modification relates to existing contract line items 
or exhibit line items, the modification shall refer to those item 
numbers.
    (2) If the contracting officer decides to assign new identifications 
to existing contract or exhibit line items, the following rules apply--
    (i) Definitized and undefinitized items. (A) The original line item 
or subline item number may be used if the modification applies to the 
total quantity of the original line item or subline.
    (B) The original line item or subline item number may be used if the 
modification makes only minor changes in the specifications of some of 
the items ordered on the original line item or subline item and the 
resulting changes in unit price can be averaged to provide a new single 
unit price for the total quantity. If the changes in the specifications 
make the item significantly distinguishable from the original item or 
the resulting changes in unit price cannot be averaged, create a new 
line item.
    (C) If the modification affects only a partial quantity of an 
existing contract or exhibit line item or subline item and the change 
does not involve either the delivery date or the ship-to/mark-for data, 
the original contract or exhibit line item or subline item number shall 
remain with the unchanged quantity. Assign the changed quantity the next 
available number.
    (ii) Undefinitized items. In addition to the rules in paragraph 
(b)(2)(i), the following additional rules apply to undefinitized items--

[[Page 37]]

    (A) If the modification is undefinitized and increases the quantity 
of an existing definitized item, assign the undefinitized quantity the 
next available number.
    (B) If the modification increases the quantity of an existing 
undefinitized item, the original contract or exhibit line item or 
subline item may be used if the unit price for the new quantity is 
expected to be the same as the price for the original quantity. If the 
unit prices of the two quantities will be different, assign the new 
quantity the next available number.
    (C) If the modification both affects only a partial quantity of the 
existing contract or exhibit line or subline item and definitizes the 
price for the affected portion, the definitized portion shall retain the 
original item number. If there is any undefinitized portion of the item, 
assign it the next available number. However, if the modification 
definitizes the price for the whole quantity of the line item, and price 
impact of the changed work can be apportioned equally over the whole to 
arrive at a new unit price, the quantity with the changes can be added 
into the quantity of the existing item.
    (D) If the modification affects only a partial quantity of an 
existing contract or exhibit line or subline item but does not change 
the delivery schedule or definitize price, the unchanged portion shall 
retain the original contract or exhibit line or subline item number. 
Assign the changed portion the next available number.



204.7107  Contract accounting classification reference number (ACRN).

    (a) When a contract contains more than one accounting classification 
citation, contracting offices shall use ACRNs. Assigning the ACRNs is 
the responsibility of the contracting office issuing the contract, basic 
ordering agreement, or blanket purchase agreement. This authority shall 
not be delegated. If more than one office will use the contract (e.g., 
ordering officers, other contracting officers), the contract must 
contain instructions for assigning ACRNs.
    (b) ACRNs are used to process certain contract data through the 
Military Standard Contract Administration Procedures (MILSCAP) system. 
The MILSCAP system uses the ACRN to relate certain contract 
administration records to the accounting classification citation used to 
obligate funds on the contract. Among these records are the accounting 
classification trailer record, the supplies schedules data record, and 
the services line item data record. ACRNs are also used to associate the 
various record formats of the contract payment notice as described in 
chapter 9 of the MILSCAP Manual, DoD 4000.25-5-M.
    (c) Procedures for establishing ACRNs. ACRNs consist of a two 
position alpha or alpha/numeric code assigned to each discrete 
accounting classification citation within each contract. ACRNs shall be 
established in accordance with the following guidelines:
    (1) Do not use the letters I and O.
    (2) In no case shall an ACRN apply to more than one accounting 
classification citation, nor shall more than one ACRN be assigned to one 
accounting classification citation.
    (d) Using the ACRN in the contract. (1) Show the ACRN as a detached 
prefix to the accounting classification citation in the accounting and 
appropriation data block or, if there are too many accounting 
classification citations to fit reasonably in that block, in section G 
(Contract Administration Data).
    (2) ACRNs need not prefix accounting classification citations if the 
accounting classification citations are present in the contract only for 
the transportation officer to cite to Government bills of lading.
    (3) If the contracting officer is making a modification to a 
contract and using the same accounting classification citations, which 
have had ACRNs assigned to them, the modification need cite only the 
ACRNs in the accounting and appropriations data block or on the 
continuation sheets.
    (e) Showing the ACRN in the contract. If there is more than one ACRN 
in a contract, all the ACRNs will appear in several places in the 
schedule (e.g., ACRN:AA).
    (1) Ship-to/mark-for block. Show the ACRN beside the identity code 
of each activity in the ship-to/mark-for block unless only one 
accounting classification citation applies to a line item or

[[Page 38]]

subline item. Only one ACRN may be assigned to the same ship-to/mark-for 
within the same contract line or subline item number unless multiple 
accounting classification citations apply to a single nonseverable 
deliverable unit such that the item cannot be related to an individual 
accounting classification citation.
    (2) Supplies/services column. (i) If only one accounting 
classification citation applies to a line item or a subline item, the 
ACRN may be shown in the supplies/services column near the item 
description.
    (ii) If more than one accounting classification citation applies to 
a single contract line item, identify each assigned ACRN and the amount 
of associated funds using informational subline items (see 204.7104-
1(a)).
    (3) Payment instructions. (i) When a contract line item is funded by 
multiple accounting classification citations, the contracting officer 
shall provide adequate instructions in section G (Contract 
Administration Data), under the heading ``Payment Instructions for 
Multiple Accounting Classification Citations,'' to permit the paying 
office to charge the accounting classification citations assigned to 
that contract line item (see 204.7104-1(a)) in a manner that reflects 
the performance of work on the contract. If additional accounting 
classification citations are subsequently added, the payment 
instructions must be modified to include the additional accounting 
classification citations.
    (ii) Payment instructions shall provide a methodology for the paying 
office to assign payments to the appropriate accounting classification 
citation(s), based on anticipated contract work performance. The method 
established should be consistent with the reasons for the establishment 
of the line items. The payment method may be based upon a unique 
distribution profile devised to reflect how the funds represented by 
each of the accounting classification citations support contract 
performance. Payment methods that direct that payments be made from the 
earliest available fiscal year funding sources, or that provide for 
proration across accounting classification citations assigned to the 
line item, or a combination thereof, may be used if that methodology 
reasonably reflects how each of the accounting classification citations 
supports contract performance.
[60 FR 34469, July 3, 1995; 60 FR 43191, Aug. 18, 1995]



                Subpart 204.72--Contractor Identification



204.7200  Scope of subpart.

    This subpart prescribes uniform policies and procedures for 
identification of commercial and Government entities when it is 
necessary to:
    (a) Exchange data with another contracting activity, including 
contract administration activities and contract payment activities, or 
to comply with the reporting requirements of subpart 204.6; or
    (b) Identify contractors for the purposes of developing computerized 
acquisition systems or solicitation mailing lists.



204.7201  Definitions.

    (a) Commercial and Government entity (CAGE) code means--
    (1) A code assigned by the Defense Logistics Services Center (DLSC) 
to identify a commercial or Government entity; or
    (2) A code assigned by a member of the North Atlantic Treaty 
Organization (NATO) and maintained by the Defense Logistics Services 
Center.
    (b) Contractor identification code means any code required by the 
contracting office for the purpose of identifying the offeror. CAGE 
codes and Data Universal Numbering System (DUNS) numbers are two 
examples of contractor identification codes.
[56 FR 36289, July 31, 1991, as amended at 61 FR 51031, Sept. 30, 1996; 
62 FR 48181, Sept. 15, 1997]



204.7202  General.

    Various coding systems are in use to identify commercial and 
government entities. Codes are requested by contracting and contract 
administration offices for various reasons. This guidance is designed to 
improve the accuracy of the initial code assignment and

[[Page 39]]

to help ensure that the data are maintained accurately and are up-to-
date.



204.7202-1  CAGE codes.

    (a) CAGE codes are assigned or maintained by the Defense Logistics 
Services Center (DLSC) to identify commercial and Government activities. 
Their use is prescribed by 253.204-70(b)(5)(ii)(C) and DoD 4000.25-5-M, 
Military Standard Contract Administration Procedures (MILSCAP).
    (b) CAGE codes have also been known in the past as federal supply 
codes for manufacturers (FSCM) and federal supply codes for 
nonmanufacturers (FSCNM).
    (c) If the CAGE code is not already available in the contracting 
office, and the apparent awardee does not respond to the provision at 
252.204-7001, Commercial and Government Entity (CAGE) Code Reporting, 
use the following procedures in the order listed--
    (1) Use the bimonthly H-8 microfiche or CD ROM publication issued by 
DLSC. (Their address is: DLSC-RP, Federal Center, 74 N. Washington, 
Battle Creek, MI 49017-3084. Their telephone numbers are: DSN 932-4725, 
FTS 552-4725, or commercial (616) 961-4725.);
    (2) Use the on-line access to the CAGE file through the Defense 
Logistics Information System;
    (3) Use the on-line access to the Defense Logistics Agency CAGE file 
through the DLA Network or dial-up capability; or
    (4) Ask DLSC to assign a CAGE code. Submit a DD Form 2051, Request 
for Assignment of a CAGE Code, (or electronic equivalent) to the address 
in paragraph (c)(1) of this subsection, ATTN: DLSC-SBB. The contracting 
activity completes Section A of the DD Form 2051, Request for Assignment 
of a Commercial and Government Entity (CAGE) Code, and the contractor 
completes section B. The contracting activity must verify section B 
before the form is submitted.
    (d) Direct questions on obtaining computer tapes, electronic 
updates, or code assignments to DLSC (DLSC-SBB) at DSN 932-4358, FTS 
552-4358, or commercial (616) 961-4358.
[56 FR 36289, July 31, 1991, as amended at 57 FR 53598, Nov. 12, 1992; 
61 FR 51031, Sept. 30, 1996; 62 FR 34121, June 24, 1997]



Sec. 204.7202-2  DUNS numbers.

    Requirements for use of DUNS numbers are contained in FAR 4.602(d) 
and 4.603.
[62 FR 48181, Sept. 15, 1997]



204.7202-3  Taxpayer identification numbers.

    The taxpayer identification number (TIN) is prescribed in FAR 
subpart 4.9.



204.7203  Responsibilities of contracting officers.

    (a) The contracting officer shall assist the offeror in obtaining 
the required contractor code(s).
    (b) Prospective offerors may not be denied a solicitation or bid set 
because the offeror does not have a contractor code.
    (c) The contracting officer or designee shall not request a new code 
assignment until the appropriate microfiche, hardcopy or computer files 
have been screened in an effort to identify a current code for the 
entity. If the contracting officer does not have access to the files or 
listings, then initiate action to obtain the files or listings and any 
equipment necessary to use those files and/or listings (see 204.7202-1 
and 2).
    (d) If a CAGE code is being requested, it is the responsibility of 
the contracting activity to request the assignment of the CAGE code by 
completing section A of the DD Form 2051, Request for Assignment of a 
Commercial and Government Entity (CAGE) Code (see 253.303-2051). The 
prospective contractor will complete section B of the form. The 
completed form or electronic equivalent will be submitted by the 
contracting activity to DLSC-SBB for processing and code assignment 
after the contracting activity has verified the data submitted by the 
contractor. CAGE codes may be requested at the time the offeror is sent 
a solicitation package or added to the mailing list to ensure that a 
code is assigned in sufficient time to process the DD Form 350, 
Individual Contracting Action Report, without delay.
[56 FR 36289, July 31, 1991, as amended at 57 FR 53598, Nov. 12, 1992; 
61 FR 51031, Sept. 30, 1996]

[[Page 40]]



204.7204  Maintenance of the CAGE file.

    (a) Changes, except name changes, may be submitted in writing--
    (1) By the entity identified by the code, using company letterhead, 
through the contract administration office;
    (2) By the contracting office; or
    (3) By the contract administration office (see also FAR subpart 
42.12, Novation and Change-of-Name Agreements);
    (4) Using the DD Form 2051, facsimile or electronic equivalent, to: 
Defense Logistics Services Center, DLSC-SBB, Federal Center, 74 N. 
Washington, Battle Creek, MI 49017-3084, Telephone Numbers: DSN 932-
4358, FTS 552-4358, commercial (616) 961-4358, Facsimile: (616) 961-
4528, 4388, Internet: http://www.dlsc.dla.mil/form2051.htm
    (b) The change-of-name agreement shall be submitted to DLSC-SBB by 
the contracting officer responsible for execution of the agreement (see 
FAR subpart 42.12). In the event there are no current contracts in 
force, each contracting and contract administration office receiving 
notification of changes from the commercial entity shall forward a copy 
of the change notice annotated with the CAGE code to DLSC-SBB unless the 
change notice indicates that DLSC-SBB has already been notified.
    (c) Additional guidance for maintaining CAGE codes is set forth at 
Volume 7 of DoD 4100.39-M, Defense Integrated Data System (DIDS) Manual.
[62 FR 48181, Sept. 15, 1997]



204.7205  Novation agreements, mergers and sales of assets.

    Contracting officers shall process and execute novation agreements 
in accordance with FAR Subpart 42.12, Novation and Change-of-Name 
Agreements. These actions are independent of code and name assignments 
made as a result of the occasion which created the need for the novation 
agreement. The maintenance activity will determine which entity(s) will 
retain the existing code(s) and which entities will be assigned new 
codes. The contracting officer responsible for processing the novation 
agreement shall provide the maintenance activity with the following 
information:
    (a) Name(s), address(es), and code(s) of the contractor(s) 
transferring the original contractual rights and obligations.
    (b) Name(s), address(es), and code(s) (if any) of the entity who is 
the successor in interest (transferor).
    (c) Name(s), address(es), and code(s) (if any) of the entity who is 
retaining or receiving the rights to the technical data.
    (d) Description of the circumstances surrounding the novation 
agreement and especially the relationship of each entity to the other.



204.7206  Using CAGE codes to identify agents and brokers.

    Authorized agents and brokers are entities and, as such, may be 
assigned CAGE codes for identification and processing purposes.
    (a) A single CAGE code will be assigned to the agent/broker 
establishment in addition to any codes assigned to the entities 
represented by the agent/broker, i.e., only one code will be assigned to 
a specific agent/broker entity regardless of the number of firms 
represented by that agent/broker.
    (b) Additional codes may be assigned to an agent/broker if they meet 
the criteria for assigning additional codes for entities, e.g., 
different location.
    (c) Codes will not be assigned to an agent/broker in care of the 
entity being represented or in any way infer that the agent/broker is a 
separate establishment bearing the name of the entity represented by the 
agent/broker.
[56 FR 36289, July 31, 1991, as amended at 61 FR 51032, Sept. 30, 1996; 
62 FR 48182, Sept. 15, 1997]

[[Page 41]]



                   SUBCHAPTER B--ACQUISITION PLANNING





PART 205--PUBLICIZING CONTRACT ACTIONS--Table of Contents




Sec.

          Subpart 205.2--Synopses of Proposed Contract Actions

205.203  Publicizing and response time.
205.207  Preparation and transmittal of synopses.

               Subpart 205.3--Synopses of Contract Awards

205.303  Announcement of contract awards.

                  Subpart 205.4--Release of Information

205.470  Contractor information to be provided cooperative agreement 
          holders.
205.470-1  Statutory requirement.
205.470-2  Contract clause.

                   Subpart 205.5--Paid Advertisements

205.502  Authority.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36302, July 31, 1991, unless otherwise noted.



          Subpart 205.2--Synopses of Proposed Contract Actions



205.203  Publicizing and response time.

    (b) Allow at least 45 days response time when requested by a 
qualifying or designated country source (as these terms are used in part 
225) and the request is consistent with the Government's requirement.



205.207  Preparation and transmittal of synopses.

    (d)(i) For small disadvantaged business set-asides under 219.502-2-
70, use CBD Numbered Note 4.
    (ii) For acquisitions being considered for small disadvantaged 
business set-aside, use CBD Numbered Note 6.
    (iii) For historically black college and university and minority 
institution set-asides under 226.7003, use CBD Numbered Note 5.
    (iv) For acquisitions being considered for historically black 
college and university and minority institution set-aside, state:

    This proposed contract is being considered as a 100 percent set-
aside for historically black colleges and universities (HBCUs) and 
minority institutions (MIs), as defined by the clause at 252.226-7000 of 
the Defense Federal Acquisition Regulation Supplement. Interested HBCUs 
and MIs should provide the contracting office as early as possible, but 
not later than 15 days after this notice, evidence of their capability 
to perform the contract, and a positive statement of their eligibility 
as an HBCU or MI. If adequate response is not received from HBCUs and 
MIs, the solicitation will instead be issued, without further notice, 
as: ______________ (indicate if unrestricted, or restricted for small 
business or small disadvantaged business, etc.). Therefore, replies to 
this notice are also requested from
 _______________________________________________________________________
(enter the types of firms to be solicited in the event an HBCU or MI 
set-aside is not made).''

    (v) For broad agency announcement (BAA) (see 235.016) notices, 
indicate which, if any, portion of the BAA will be set-aside for 
historically black colleges and universities and minority institutions.
    (e) For acquisitions restricted to domestic sources under the 
authority of FAR 6.302-3, use CBD Numbered Note 13.



               Subpart 205.3--Synopses of Contract Awards



205.303  Announcement of contract awards.

    (a) Public announcement. (i) The threshold for DoD awards is $5 
million. Report all contractual actions, including modifications, that 
have a face value, excluding unexercised options, of more than $5 
million.
    (A) For undefinitized contractual actions, report the not-to-exceed 
(NTE) amount. Later, if the definitized amount exceeds the NTE amount by 
more than $5 million, report only the amount exceeding the NTE.
    (B) For indefinite delivery, time and material, labor hour, and 
similar contracts, report the initial award if the estimated face value, 
excluding

[[Page 42]]

unexercised options, is more than $5 million. Do not report orders up to 
the estimated value, but after the estimated value is reached, report 
subsequent modifications and orders that have a face value of more than 
$5 million.
    (C) Do not report the same work twice.
    (ii) Departments and agencies submit the information--
    (A) To the Office of the Assistant Secretary of Defense (Public 
Affairs);
    (B) By the close of business the day before the date of the proposed 
award;
    (C) Using report control symbol DD-LA- (AR) 1279;
    (D) Including, as a minimum, the following--
    (1) Contract data. Contract number, modification number, or delivery 
order number, face value of this action, total cumulative face value of 
the contract, description of what is being bought, contract type, 
whether any of the buy was for foreign military sales (FMS) and 
identification of the FMS customer;
    (2) Competition information. Number of solicitations mailed and 
number of offers received;
    (3) Contractor data. Name, address, and place of performance (if 
significant work is performed at a different location);
    (4) Funding data. Type of appropriation and fiscal year of the 
funds, and whether the contract is multiyear (see FAR Subpart 17.1); and
    (5) Miscellaneous data. Identification of the contracting office, 
the contracting office point of contact, known congressional interest, 
and the information release date.
    (iii) Departments and agencies, in accordance with department/agency 
procedures and concurrent with the public announcement, shall provide 
information similar to that required by paragraph (a)(ii) of this 
section to members of Congress in whose state or district the contractor 
is located and the work is to be performed.
[56 FR 36302, July 31, 1991, as amended at 56 FR 67212, Dec. 30, 1991]



                  Subpart 205.4--Release of Information



205.470  Contractor information to be provided cooperative agreement holders.



205.470-1  Statutory requirement.

    (a) As required by 10 U.S.C. 2413, the Defense Logistics Agency 
enters into cooperative agreements--
    (1) With--
    (i) State and local governments;
    (ii) Non-profit organizations;
    (iii) Indian tribal organizations; and
    (iv) Indian-owned economic enterprises
    (2) For the provision of technical assistance to business entities.
    (b) Contractors receiving defense contracts valued at more than 
$500,000 must provide cooperative agreement holders, at their request, 
the information specified in the clause at 252.205-7000, Provision of 
Information to Cooperative Agreement Holders.



205.470-2  Contract clause.

    Use the clause at 252.205-7000, Provision of Information to 
Cooperative Agreement Holders, in solicitations and contracts expected 
to exceed $500,000.



                   Subpart 205.5--Paid Advertisements



205.502  Authority.

    For paid advertisements to recruit civilian personnel, see section 
332-1-9 of the Federal Personnel Manual.
    (a) Newspapers. (i) Heads of contracting activities are delegated 
authority to approve the publication of paid advertisements in 
newspapers. They may redelegate this authority in accordance with agency 
procedures.
    (ii) Submit DD Form 1535, Request/Approval for Authority to 
Advertise, to the approval authority to obtain special or general 
authority.
    (A) Special authority permits the publication of a given 
advertisement for a specified number of times in designated newspapers.
    (B) General authority permits the publication of such advertisements 
as may be required during a designated fiscal year.

[[Page 43]]



PART 206--COMPETITION REQUIREMENTS--Table of Contents




Sec.
206.001  Applicability.

   Subpart 206.2--Full and Open Competition After Exclusion of Sources

206.202  Establishing or maintaining alternative sources.
206.203  Set-asides for small business and labor surplus area concerns.

           Subpart 206.3--Other Than Full and Open Competition

206.302  Circumstances permitting other than full and open competition.
206.302-1  Only one responsible source and no other supplies or services 
          will satisfy agency requirements.
206.302-2  Unusual and compelling urgency.
206.302-3  Industrial mobilization; or engineering, development, or 
          research capability.
206.302-3  -70  Solicitation provision.
206.302-4  International agreement.
206.302-5  Authorized or required by statute.
206.302-7  Public interest.
206.303  Justifications.
206.303-1  Requirements.
206.303-2  Content.
206.304  Approval of the justification.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36303, July 31, 1991, unless otherwise noted.



206.001  Applicability.

    (b) Contracts awarded using the procedures in 237.104(b)(ii) are 
expressly authorized by 10 U.S.C. 1091.
[60 FR 61592, Nov. 30, 1995]



   Subpart 206.2--Full and Open Competition After Exclusion of Sources



206.202  Establishing or maintaining alternative sources.

    (a) Agencies may use this authority to totally or partially exclude 
a particular source from a contract action.
    (b) The determination and findings (D&F) and the documentation 
supporting the D&F must identify the source to be excluded from the 
contract action.
    (i) Include the following information, as applicable, and any other 
information that may be pertinent, in the supporting documentation:
    (A) The acquisition history of the supplies or services, including 
sources, prices, quantities, and dates of award;
    (B) The circumstances which make it necessary to exclude the 
particular source from the contract action, including--
    (1) The reasons for the lack of or potential loss of alternative 
sources; e.g., the technical complexity and criticality of the supplies 
or services; and
    (2) The current annual requirement and projected needs for the 
supplies or services;
    (C) Whether the existing source must be totally excluded from the 
contract action or whether a partial exclusion is sufficient;
    (D) The potential effect of exclusion on the excluded source in 
terms of loss of capability to furnish the supplies or services in the 
future;
    (E) When FAR 6.202(a)(1) is the authority, the basis for--
    (1) The determination of future competition; and
    (2) The determination of reduced overall costs. Include, as a 
minimum, a discussion of start-up costs, facility costs, duplicative 
administration costs, economic order quantities, and life cycle cost 
considerations; and
    (F) When FAR 6.202(a)(2) is the authority--
    (1) The current annual and mobilization requirements for the 
supplies or services, citing the source of, or the basis for, the data;
    (2) A comparison of current production capacity with that necessary 
to meet mobilization requirements;
    (3) An analysis of the risks of relying on the present source; and
    (4) A projection of the time required for a new source to acquire 
the necessary facilities and achieve the production capacity necessary 
to meet mobilization requirements.
    (ii) A sample format for Determination and Findings citing the 
authority of FAR 6.202(a) is in Table 6-1, Determinations and Findings.

[[Page 44]]



                 Table 6-1--Determinations and Findings                 
                                                                        
                                                                        
                       Determinations and Findings                      
                      Authority to Exclude a Source                     
In accordance with 10 U.S.C. 2304(b)(1), it is my determination that the
 following contract action may be awarded using full and open           
 competition after exclusion of ________\1\:                            
------------------------------------------------------------------------

    (Describe requirement.) Findings The exclusion of ________\1\
---------------------------------------------------------------------------

    \1\ Identify source being excluded.
---------------------------------------------------------------------------

    Alternate 1: will increase or maintain competition for this 
requirement and is expected to result in a reduction of $______ in 
overall costs for the present and future acquisition of these supplies 
or services. (Describe how estimate was derived.)
    Alternate 2: is in the interest of national defense because it will 
result in having a supplier available for furnishing these supplies or 
services in case of a national emergency or industrial mobilization. 
(Explain circumstances requiring exclusion of source.)
    Alternate 3: is in the interest of national defense because it will 
result in establishment or maintenance of an essential engineering, 
research or development capability to be provided by an educational or 
other nonprofit institution or a federally funded research and 
development center. (Explain circumstances requiring exclusion of 
source.)



206.203  Set-asides for small business and labor surplus area concerns.

    (b) Also no separate justification or determination and findings is 
required for contract actions processed as small disadvantaged business 
set-asides (219.502-2-70) or as historically black college and 
university and minority institution set-asides (226.7003).



           Subpart 206.3--Other Than Full and Open Competition



206.302  Circumstances permitting other than full and open competition.



206.302-1  Only one responsible source and no other supplies or services will satisfy agency requirements.

    (a) Authority. (2)(i) Section 8059 of Pub. L. 101-511 and similar 
sections in subsequent defense appropriations acts prohibit departments 
and agencies from entering into contracts for studies, analyses, or 
consulting services (see FAR subpart 37.2) on the basis of an 
unsolicited proposal without providing for full and open competition, 
unless--
    (1) The head of the contracting activity, or a designee no lower 
than chief of the contracting office, determines that--
    (i) Following thorough technical evaluation, only one source is 
fully qualified to perform the proposed work;
    (ii) The unsolicited proposal offers significant scientific or 
technological promise, represents the product of original thinking, and 
was submitted in confidence; or
    (iii) The contract benefits the national defense by taking advantage 
of a unique and significant industrial accomplishment or by ensuring 
financial support to a new product or idea;
    (2) A civilian official of the DoD, whose appointment has been 
confirmed by the Senate, determines the award to be in the interest of 
national defense; or
    (3) The contract is related to improvement of equipment that is in 
development or production.
    (b) Application. This authority may be used for acquisitions of test 
articles and associated support services from a designated foreign 
source under the DoD Foreign Comparative Testing Program.
    (4) Do not use this authority unless the equipment or parts have 
been adopted as standard items of supply in accordance with DoDI 5000.2, 
Defense Acquisition Management Policies and Procedures.
[56 FR 36303, July 31, 1991, as amended at 57 FR 14992, Apr. 23, 1992; 
58 FR 28463, May 13, 1993]



206.302-2  Unusual and compelling urgency.

    (b) Application. The circumstances under which use of this authority 
may be appropriate include, but are not limited to, the following:
    (i) Supplies, services, or construction needed at once because of 
fire, flood, explosion, or other disaster;

[[Page 45]]

    (ii) Essential equipment or repair needed at once to--
    (A) Comply with orders for a ship;
    (B) Perform the operational mission of an aircraft; or
    (C) Preclude impairment of launch capabilities or mission 
performance of missiles or missile support equipment.
    (iii) Construction needed at once to preserve a structure or its 
contents from damage;
    (iv) Purchase requests citing an issue priority designator under 
DoDD 4410.6, Uniform Material Movement and Issue Priority System, of 4 
or higher, or citing ``Electronic Warfare QRC Priority.''



206.302-3  Industrial mobilization; or engineering, development, or research capability.



206.302-3-70  Solicitation provision.

    Use the provision at 252.206-7000, Domestic Source Restriction, in 
all solicitations that are restricted to domestic sources under the 
authority of FAR 6.302-3.



206.302-4  International agreement.

    (c) Limitations. Pursuant to 10 U.S.C. 2304(f)(2)(E), the 
justifications and approvals described in FAR 6.303 and 6.304 are not 
required if--
    (i) The head of the contracting activity prepares a document which 
describes the terms of an agreement or treaty or the written directions, 
such as a Letter of Offer and Acceptance, that have the effect of 
requiring the use of other than competitive procedures for the 
acquisition; and
    (ii) The document in paragraph (c)(i) of this subsection is approved 
by the competition advocate for the contracting activity.



206.302-5  Authorized or required by statute.

    (b) Application. Agencies may use this authority to--
    (i) Acquire supplies and services from military exchange stores 
outside the United States for use by the armed forces outside the United 
States in accordance with 10 U.S.C. 2424(a) and subject to the 
limitations of 10 U.S.C. 2424(b). The limitations of 10 U.S.C. 2424(b) 
(1) and (2) do not apply to the purchase of soft drinks that are 
manufactured in the United States. For the purposes of 10 U.S.C. 2424, 
soft drinks manufactured in the United States are brand name carbonated 
sodas, manufactured in the United States, as evidenced by product 
markings.
    (ii) Acquire police, fire protection, airfield operation, or other 
community services from local governments at military installations to 
be closed under the circumstances in 237.7401 (Section 2907 of Fiscal 
Year 1994 Defense Authorization Act (Pub. L. 103-160)).
    (c) Limitations. (i) 10 U.S.C. 2361 precludes use of this exception 
for awards to colleges or universities for the performance of research 
and development, or for the construction of any research or other 
facility, unless--
    (A) The statute authorizing or requiring award specifically--
    (1) States that the statute modifies or supersedes the provisions of 
10 U.S.C. 2361,
    (2) Identifies the particular college or university involved, and
    (3) States that award is being made in contravention of 10 U.S.C. 
2361(a); and
    (B) The Secretary of Defense provides Congress written notice of 
intent to award. The contract cannot be awarded until 180 days have 
elapsed since the date Congress received the notice of intent to award. 
Contracting activities must submit a draft notice of intent with 
supporting documentation through channels to the Director of Defense 
Procurement, Office of the Under Secretary of Defense (Acquisition & 
Technology).
    (ii) The limitation in paragraph (c)(i) of this subsection applies 
only if the statute authorizing or requiring award was enacted after 
September 30, 1989.
    (iii) Subsequent statutes may provide different or additional 
constraints on the award of contracts to specified colleges and 
universities. Contracting officers should consult legal counsel on a 
case-by-case basis.
[56 FR 36303, July 31, 1991, as amended at 57 FR 14992, Apr. 23, 1992; 
58 FR 28463, May 13, 1993; 59 FR 36089, July 15, 1994; 60 FR 29497, June 
5, 1995; 60 FR 40107, Aug. 7, 1995]

[[Page 46]]



206.302-7  Public interest.

    (c) Limitations. For the defense agencies, the written determination 
to use this authority must be made by the Secretary of Defense.



206.303  Justifications.



206.303-1  Requirements.

    (b) Technical and requirements personnel must obtain any review and 
approval required by department or agency procedures before submission 
of a recommendation for other than full and open competition to the 
contracting officer.
    (c) When conditions warrant, a class justification may provide for 
award of multiple contracts extending across more than one program 
phase.
[56 FR 36303, July 31, 1991, as amended at 60 FR 61592, Nov. 30, 1995]



206.303-2  Content.

    (a) Include sufficient information in the justification to permit 
its approval as a stand-alone document, even though agency procedures 
may require supplementary documentation.



206.304  Approval of the justification.

    (a)(4) The Under Secretary of Defense (Acquisition & Technology) may 
delegate this authority to--
    (A) An Assistant Secretary of Defense; or
    (B) For a defense agency, an officer or employee serving in, 
assigned, or detailed to that agency who--
    (1) If a member of the armed forces, is serving in a rank above 
brigadier general or rear admiral (lower half); or
    (2) If a civilian, is serving in a position with a grade under the 
General Schedule (or any other schedule for civilian officers or 
employees) that is comparable to or higher than the grade of major 
general or rear admiral.
[61 FR 10285, Mar. 13, 1995, as amended at 61 FR 50451, Sept. 26, 1996]



PART 207--ACQUISITION PLANNING--Table of Contents




                    Subpart 207.1--Acquisition Plans

Sec.
207.102  Policy.
207.103  Agency-head responsibilities.
207.104  General procedures.
207.105  Contents of written acquisition plans.
207.106   Additional requirements for major systems.

               Subpart 207.4--Equipment Lease or Purchase

207.401  Acquisition considerations.
207.470  Statutory requirements.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36305, July 31, 1991, unless otherwise noted.



                    Subpart 207.1--Acquisition Plans



207.102  Policy.

    When a class justification for other than full and open competition 
has been approved, planning for competition shall be accomplished 
consistent with the terms of that approval.
[60 FR 61592, Nov. 30, 1995]



207.103  Agency-head responsibilities.

    (c)(i) Military departments and agencies shall prepare written 
acquisition plans for--
    (A) Acquisitions for development, as defined in FAR 35.001, when the 
total cost of all contracts for the acquisition program is estimated at 
$5 million or more;
    (B) Acquisitions for production or services when the total cost of 
all contracts for the acquisition program is estimated at $30 million or 
more for all years or $15 million or more for any fiscal year; and
    (C) Any other acquisition considered appropriate by the department 
or agency.
    (ii) Written plans are not required in acquisitions for a final buy 
out or one-time buy. The terms ``final buy out'' and ``one-time buy'' 
refer to a single contract which covers all known present and future 
requirements. This exception does not apply to a multiyear contract or a 
contract with options or phases.
    (d) Prepare written acquisition plans for acquisition programs 
meeting the thresholds of paragraphs (c)(i) (A) and (B) of this section 
on a program basis. Other acquisition plans may be written

[[Page 47]]

on either a program or an individual contract basis.
    (f) The program manager, or other official responsible for the 
program, has overall responsibility for acquisition planning.
    (h)(i) Apply design-to-cost principles--
    (A) In all major defense acquisition programs (DoDD 5000.1, Defense 
Acquisition), unless exempted by the Secretary of Defense; and
    (B) To the acquisition of systems, subsystems, and components below 
the thresholds for major defense acquisition programs, to the extent 
prescribed by DoDD 5000.1.
    (ii) Consider life-cycle-cost in all acquisitions of systems and 
equipment.
[56 FR 36305, July 31, 1991, as amended at 61 FR 50451, Sept. 26, 1996]



207.104  General procedures.

    (b) The planner should forward the requirements information to the 
contract administration organization when assistance in identification 
of potential sources of supply is necessary, when an existing contract 
is being modified or resolicited, or when contract administration 
resource requirements will be affected.
[61 FR 50451, Sept. 26, 1996]



207.105  Contents of written acquisition plans.

    For acquisitions covered by 207.103(c)(i) (A) and (B), correlate the 
plan to the DoD Future Years Defense Program, applicable budget 
submissions, and the decision coordinating paper/program memorandum, as 
appropriate. It is incumbent upon the planner to coordinate the plan 
with all those who have a responsibility for the development, 
management, or administration of the acquisition. The acquisition plan 
should be provided to the contract administration organization to 
facilitate resource allocation and planning for the evaluation, 
identification, and management of contractor performance risk.
    (a) Acquisition background and objectives--(1) Statement of need. 
Include--
    (A) Applicability of a decision coordinating paper (DCP), 
acquisition decision memorandum, Defense Acquisition Board (DAB), and/or 
internal service reviews. Describe the options in the DCP/acquisition 
decision memorandum and delineate which option the acquisition plan 
supports.
    (B) The date approval for operational use has been or will be 
obtained. If waivers are requested, describe the need for the waivers.
    (C) A milestone chart depicting the acquisition objectives.
    (D) Milestones for updating the acquisition plan. Indicate when the 
plan will be updated. Program managers should schedule updates to 
coincide with DAB reviews and the transition from one phase to another 
(e.g., engineering and manufacturing development to production and 
deployment).
    (8) Acquisition streamlining. DoDD 5000.1, Defense Acquisition, and 
DoD 5000.2-R, Mandatory Procedures for Major Defense Acquisition 
Programs (MDAPs) and Major Automated Information System (MAIS) 
Acquisition Programs, contain policy direction on acquisition 
streamlining. See MIL-HDBK 248, Acquisition Streamlining, for guidance 
on streamlining performance requirements, the technical package, and the 
contract strategy.
    (b) Plan of action.--(5) Budgeting and funding. Include specific 
references to budget line items and program elements, where applicable, 
estimated production unit cost, and the total cost for remaining 
production.
    (6) Product descriptions. For development acquisitions, describe the 
market research undertaken to identify commercial items, commercial 
items with modifications, or nondevelopmental items (see FAR part 10) 
that could satisfy the acquisition objectives.
    (13) Logistics considerations. (i) Describe the extent of integrated 
logistics support planning to date, including references to approved 
plans.
    (ii) Discuss the mission profile, reliability, and maintainability 
(R&M) program plan, R&M predictions, redundancy, qualified parts lists, 
parts and material qualification, R&M requirements imposed on vendors, 
failure analysis, corrective action and feedback, and R&M design reviews 
and trade-off studies.
    (iv) See DoDD 5000.1, Defense Acquisition, and DoD 5000.2-R, 
Mandatory

[[Page 48]]

Procedures for Major Defense Acquisition Programs (MDAPs) and Major 
Automated Information System (MAIS) Acquisition Programs, for procedures 
on standardization and on the DoD Parts Control Program. See MIL-STD-
965, Parts Control Program, for procedures on the Standardized Military 
Drawing Program.
    (S-70) Describe the extent of Computer-Aided Acquisition and 
Logistics Support (CALS) implementation (see MIL-HDBK 59, Department of 
Defense Computer-Aided Logistics Support (CALS) Program Guide, and MIL-
STD-1840A, Automated Interchange of Technical Information.
    (16) Environmental and energy conservation objectives. Discuss 
actions taken to ensure either elimination of or authorization to use 
class I ozone-depleting chemicals and substances (see 211.271).
    (18) Other considerations. (A) National Technology and Industrial 
Base. For major defense acquisition programs, address the following 
(Pub. L. 102-484, section 4220)--
    (1) An analysis of the capabilities of the national technology and 
industrial base to develop, produce, maintain, and support such program, 
including consideration of the following factors related to foreign 
dependency (Pub. L. 102-484, section 4219(h))--
    (i) The availability of essential raw materials, special alloys, 
composite materials, components, tooling, and production test equipment 
for the sustained production of systems fully capable of meeting the 
performance objectives established for those systems; the uninterrupted 
maintenance and repair of such systems; and the sustained operation of 
such systems.
    (ii) The identification of items specified in paragraph 
(b)(18)(A)(1)(i) of this section that are available only from sources 
outside the national technology and industrial base.
    (iii) The availability of alternatives for obtaining such items from 
within the national technology and industrial base if such items become 
unavailable from sources outside the national technology industrial 
base; and an analysis of any military vulnerability that could result 
from the lack of reasonable alternatives.
    (iv) The effects on the national technology and industrial base that 
result from foreign acquisition of firms in the United States.
    (2) Consideration of requirements for efficient manufacture during 
the design and production of the systems to be procured under the 
program.
    (3) The use of advanced manufacturing technology, processes, and 
systems during the research and development phase and the production 
phase of the program.
    (4) To the maximum extent practicable, the use of contract 
solicitations that encourage competing offerors to acquire, for use in 
the performance of the contract, modern technology, production 
equipment, and production systems (including hardware and software) that 
increase the productivity of the offerors and reduce the life-cycle 
costs.
    (5) Methods to encourage investment by U.S. domestic sources in 
advanced manufacturing technology production equipment and processes 
through--
    (i) Recognition of the contractor's investment in advanced 
manufacturing technology production equipment, processes, and 
organization of work systems that build on workers' skill and 
experience, and work force skill development in the development of the 
contract objective; and
    (ii) Increased emphasis in source selection on the efficiency of 
production.
    (6) Expanded use of commercial manufacturing processes rather than 
processes specified by DoD.
    (7) Elimination of barriers to, and facilitation of, the integrated 
manufacture of commercial items and items being produced under DoD 
contracts.
    (8) Expanded use of commercial items, commercial items with 
modifications, or to the extent commercial items are not available, 
nondevelopmental items (see FAR part 10).
    (B) Industrial preparedness (IP).
    (1) Provide the program's IP strategy that assesses the capability 
of the U.S. industrial base to achieve identified surge and mobilization 
goals. If no IP strategy has been developed, provide supporting 
rationale for this position.
    (2) If in the IP strategy, the development of a detailed IP plan was 
determined to be applicable, include the

[[Page 49]]

plan by text or by reference. If the development of the IP plan was 
determined not to be applicable, summarize the details of the analysis 
forming the basis of this decision.
    (3) If the program involves peacetime and wartime hardware 
configurations which are supported by logistics support plans, identify 
their impact on the IP plan.
    (C) Ensure compliance with DoDD 4210.15, Hazardous Material 
Pollution Prevention.
    (D) Contract administration. Discuss the level of Government 
administration anticipated or currently performed and any change 
proposed by the contract administration office.
[56 FR 36305, July 31, 1991, as amended at 58 FR 28463, May 13, 1993; 58 
FR 32061, June 8, 1993; 60 FR 29497, June 5, 1995; 60 FR 61593, Nov. 30, 
1995; 61 FR 50451, Sept. 26, 1996]



207.106  Additional requirements for major systems.

    (b)(1)(A) The contracting officer is prohibited by 10 U.S.C. 
2305(d)(4)(A) from requiring offers for development or production of 
major systems that would enable the Government to use technical data to 
competitively reprocure identical items or components of the system if 
the item or component were developed exclusively at private expense, 
unless the contracting officer determines that--
    (1) The original supplier of the item or component will be unable to 
satisfy program schedule or delivery requirements;
    (2) Proposals by the original supplier of the item or component to 
meet mobilization requirements are insufficient to meet the agency's 
mobilization needs; or
    (3) The Government is otherwise entitled to unlimited rights in 
technical data.
    (B) If the contracting officer makes a determination, under 
paragraphs (b)(1)(A) (1) and (2) of this section, for a competitive 
solicitation, 10 U.S.C. 2305(d)(4)(B) requires that the evaluation of 
items developed at private expense be based on an analysis of the total 
value, in terms of innovative design, life-cycle costs, and other 
pertinent factors, of incorporating such items in the system.



               Subpart 207.4--Equipment Lease or Purchase



207.401  Acquisition considerations.

    If the equipment will be leased for more than 60 days, the requiring 
activity must prepare and provide the contracting officer with the 
justification supporting the decision to lease or purchase.



207.470  Statutory requirements.

    (a) Limitation on contracts with terms of 18 months or more. As 
required by 10 U.S.C. 2401a, the contracting officer shall not enter 
into any contract for any vessel, aircraft, or vehicle, through a lease, 
charter, or similar agreement with a term of 18 months or more, or 
extend or renew any such contract for a term of 18 months or more, 
unless the head of the contracting activity has--
    (1) Considered all costs of such a contract (including estimated 
termination liability); and
    (2) Determined in writing that the contract is in the best interest 
of the Government.
    (b) Leasing of commercial vehicles and associated equipment. Except 
as provided in paragraph (a) of this section, the contracting officer 
may use leasing in the acquisition of commercial vehicles and associated 
equipment whenever the contracting officer determines that leasing of 
such vehicles is practicable and efficient (10 US.C. 2401a).
[61 FR 16879, Apr. 18, 1996, as amended at 61 FR 50451, Sept. 26, 1996]



PART 208--REQUIRED SOURCES OF SUPPLIES AND SERVICES--Table of Contents




Sec.
208.001  Priorities for use of Government supply sources.
208.002  Use of other Government supply sources.

          Subpart 208.4--Ordering from Federal Supply Schedules

208.404  Using schedules.
208.404-1  Mandatory use.
208.404-2  Optional use.
208.405  Ordering office responsibilities.
208.405-2  Order placement.

[[Page 50]]

Subpart 208.7--Acquisition from the Blind and Other Severely Handicapped

208.705  Procedures.

                 Subpart 208.70--Coordinated Acquisition

208.7000  Scope of subpart.
208.7001  Definitions.
208.7002  Assignment authority.
208.7002-1  Acquiring department responsibilities.
208.7002-2  Requiring department responsibilities.
208.7003  Applicability.
208.7003-1  Assignments under integrated material management (IMM).
208.7003-2  Assignments under coordinated acquisition.
208.7004  Procedures.
208.7004-1  Purchase authorization from requiring department.
208.7004-2  Acceptance by acquiring department.
208.7004-3  Use of advance MIPRs.
208.7004-4  Cutoff dates for submission of Category II MIPRs.
208.7004-5  Notification of inability to obligate on Category II MIPRs.
208.7004-6  Cancellation of requirements.
208.7004-7  Termination for default.
208.7004-8  Transportation funding.
208.7004-9  Status reporting.
208.7004-10  Administrative costs.
208.7005  MIPRs.
208.7006  Coordinated acquisition assignments.

     Subpart 208.71--Acquisition for National Aeronautics and Space 
                          Administration (NASA)

208.7100  Authorization.
208.7101  Policy.
208.7102  Procedures.
208.7103  Purchase request and acceptance.
208.7104  Changes in estimated total prices.
208.7105  Payments.

       Subpart 208.72--Industrial Preparedness Production Planning

208.7201  Definitions.
208.7202  General.
208.7203  Authority.
208.7204  Procedures.

         Subpart 208.73--Use of Government-Owned Precious Metals

208.7301  Definitions.
208.7302  Policy.
208.7303  Procedures.
208.7304  Refined precious metals.
208.7305  Contract clause.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36306, July 31, 1991, unless otherwise noted.



208.001  Priorities for use of Government supply sources.

    (a)(1)(v) See subpart 208.70, Coordinated Acquisition.
    (2)(iii) Information on General Services Administration (GSA) 
schedules for maintenance, repair, and rehabilitation of personal 
property is in the GSA supply catalog. The types of personal property 
for which GSA, Federal Supply Service has schedule contracts for 
maintenance, repair, and/or rehabilitation are--
    (1) Furniture (office, household, quarters, institutional, and 
hospital type);
    (2) Typewriters (manual, electric, and electronic);
    (3) Repair and maintenance of Government owned vehicles; and
    (4) Tire retreading and repair (except aircraft).



208.002  Use of other Government supply sources.

    (f) Detailed information on strategic and critical materials in 
excess of national stockpile requirements (e.g., metals, ores, 
chemicals) is available from the Defense National Stockpile Center, 8725 
John J. Kingman Road, Suite 4616, Fort Belvoir, VA 22060-6223.
    (g) Acquire helium (Pub. L. 86-777)--
    (i) In bulk from--
    (A) The Department of Interior (Bureau of Mines); or
    (B) Eligible private helium distributors. A list of eligible private 
helium distributors is maintained by the Bureau of Mines, Helium Field 
Operations, 1100 South Fillmore Street, Amarillo, TX 79101.
    (ii) In cylinders or trailers, from--
    (A) The Department of Interior (Bureau of Mines); or
    (B) Through GSA Federal Supply Schedule contracts.
[56 FR 36306, July 31, 1991, as amended at 62 FR 34121, June 24, 1997]



          Subpart 208.4--Ordering From Federal Supply Schedules



208.404  Using schedules.

    (a) When a schedule lists both foreign and domestic items that will 
meet the

[[Page 51]]

needs of the requiring activity, the ordering office must apply the 
procedures of part 225 and FAR part 25, Foreign Acquisition. When 
purchase of an item of foreign origin is specifically required, the 
requiring activity must furnish the ordering office sufficient 
information to permit the determinations required by part 225 and FAR 
part 25 to be made.



208.404-1  Mandatory use.

    The DoD will not be a mandatory user of any schedule unless 
individual DoD activities elect to provide annual requirements estimates 
to GSA and become mandatory users. Examples of areas where this approach 
may be applied are:
    (1) Group 68--gases and chemicals;
    (2) Group 26--pneumatic tires and inner tubes;
    (3) Maintenance, repair, and/or rehabilitation of personal property; 
and
    (4) ``Just-in-time'' arrangements for delivery of material directly 
from vendors to users.



208.404-2  Optional use.

    Make maximum use of the schedules. Other procedures may be used if 
further competition is judged to be in the best interest of the 
Government in terms of quality, responsiveness, or cost.



208.405  Ordering office responsibilities.



208.405-2  Order placement.

    (1) Ordering offices may use DD Form 1155, Order for Supplies or 
Services, to order items from schedules.
    (2) Orders may be placed orally if--
    (i) The order does not exceed the small purchase threshold at FAR 
13.000;
    (ii) The contractor agrees to furnish a delivery ticket for each 
shipment under the order (in the number of copies required by the 
ordering office). The ticket must include the--
    (A) Contract number;
    (B) Order number under the contract;
    (C) Date of order;
    (D) Name and title of person placing order;
    (E) Itemized listing of supplies or services furnished; and
    (F) Date of delivery or shipment.
    (iii) Invoicing procedures are agreed upon. Optional methods of 
submitting invoices for payment are permitted, such as--
    (A) An individual invoice with a receipted copy of the delivery 
ticket;
    (B) A summarized monthly invoice covering all oral orders made 
during the month, with receipted copies of the delivery tickets (this 
option is preferred if there are many oral orders); or
    (C) A contracting officer statement that the Government has received 
the supplies.
    (3) For purchases where cash payment is an advantage, the use of 
imprest funds (see FAR 13.4) is authorized when--
    (i) The order does not exceed the threshold at FAR 13.404(a); and
    (ii) The contractor agrees to the procedure.



Subpart 208.7--Acquisition From the Blind and Other Severely Handicapped



208.705  Procedures.

    Ordering offices may use DD Form 1155, Order for Supplies or 
Services, to place orders with central nonprofit agencies or workshops.



                 Subpart 208.70--Coordinated Acquisition



208.7000  Scope of subpart.

    This subpart prescribes policy and procedures for acquisition of 
items for which contracting responsibility is assigned to one or more of 
the departments/agencies or the General Services Administration. 
Contracting responsibility is assigned through--
    (a) The Coordinated Acquisition Program (commodity assignments are 
listed in appendix B); or
    (b) The Integrated Materiel Management Program (assignments are in 
DoD 4140.26-M, Integrated Materiel Management for Consumable Items).



208.7001  Definitions.

    For purposes of this subpart--
    Acquiring department means the department, agency, or General 
Services Administration which has contracting

[[Page 52]]

responsibility under the Coordinated Acquisition Program.
    Integrated materiel management means assignment of acquisition 
management responsibility to one department, agency, or the General 
Services Administration for all of DoD's requirements for the assigned 
item. Acquisition management normally includes computing requirements, 
funding, budgeting, storing, issuing, cataloging, standardizing, and 
contracting functions.
    Requiring department means the department or agency which has the 
requirement for an item.



208.7002  Assignment authority.

    (a) Under the DoD Coordinated Acquisition Program, contracting 
responsibility for certain commodities is assigned to a single 
department, agency, or the General Services Administration (GSA). 
Commodity assignments are made--
    (1) To the departments and agencies, by the Assistant Secretary of 
Defense (Production and Logistics);
    (2) To the GSA, through agreement with GSA, by the Assistant 
Secretary of Defense (Production and Logistics);
    (3) Outside the continental United States, by the Unified 
Commanders; and
    (4) For acquisitions to be made in the United States for commodities 
not assigned under paragraphs (a) (1), (2), or (3) of this section, by 
agreement of agency heads (10 U.S.C. 2308).
    (i) Agreement may be on either a one-time or a continuing basis. The 
submission of a military interdepartmental purchase request (MIPR) by a 
requiring activity and its acceptance by the contracting activity of 
another department, even though based on an oral communication, 
constitutes a one-time agreement.
    (ii) Consider repetitive delegated acquisition responsibilities for 
coordinated acquisition assignment. If not considered suitable for 
coordinated acquisition assignment, formalize continuing agreements and 
distribute them to all activities concerned.
    (b) Under the Integrated Materiel Management Program, assignments 
are made by the Assistant Secretary of Defense (Production and 
Logistics)--
    (1) To the departments and agencies; and
    (2) To the GSA, through agreement with GSA.



208.7002-1  Acquiring department responsibilities.

    The acquiring department generally is responsible under coordinated 
acquisition for--
    (a) Operational aspects of acquisition planning (Phasing the 
submission of requirements to contracting, consolidating or dividing 
requirements, analyzing the market, and determining patterns for the 
phased placement of orders to avoid unnecessary production fluctuations 
and meet the needs of requiring departments at the lowest price);
    (b) Purchasing;
    (c) Performing or assigning contract administration, including 
follow up and expediting of inspection and transportation; and
    (d) Obtaining licenses under patents and settling patent 
infringement claims arising out of the acquisition. (Acquiring 
departments must obtain approval from the department whose funds are to 
be charged for obtaining licenses or settling claims.)



208.7002-2  Requiring department responsibilities.

    The requiring department is responsible for--
    (a) Ensuring compliance with the order of priority in FAR 8.001 for 
use of Government supply sources before submitting a requirement to the 
acquiring department for contracting action.
    (b) Providing the acquiring department--
    (1) The complete and certified documentation required by FAR 6.303-
2(b). A requiring department official, equivalent to the appropriate 
level in FAR 6.304, must approve the documentation before submission of 
the military interdepartmental purchase request (MIPR) to the acquiring 
department;
    (2) Any additional supporting data which the acquiring department 
contracting officer requests (e.g., the results of any market survey or 
why none was conducted, and actions the requiring department will take 
to overcome barriers to competition in the future);

[[Page 53]]

    (3) The executed determination and findings required by FAR 6.302-
7(c)(1);
    (4) When a requiring department requests an acquiring department to 
contract for supplies or services using full and open competition after 
exclusion of sources, all data required by FAR 6.202(b)(2);
    (5) When the requiring department specifies a foreign end product, 
any determinations required by part 225 or FAR part 25;
    (6) A complete definition of the requirements, including a list (or 
copies) of specifications, drawings, and other data required for the 
acquisition. The requiring department need not furnish Federal, 
military, departmental, or other specifications or drawings or data 
which are available to the acquiring department;
    (7) Justification required by FAR 17.205(a) for any option 
quantities requested;
    (8) A statement as to whether used or reconditioned material, former 
Government surplus property, or residual inventory will be acceptable, 
and if so--
    (i) A list of any supplies that need not be new; and
    (ii) The basis for determining the acceptability of such supplies, 
including an analysis of the factors at FAR 10.010(b);
    (9) A statement as to whether the acquiring department may exceed 
the total MIPR estimate, and if so, by what amount;
    (10) Unless otherwise agreed between the departments, an original 
and six copies of each MIPR and its attachments (except specifications, 
drawings, and other data); and
    (11) A list of all persons who have had access to proprietary or 
source selection information (see FAR 3.104-9(e)).



208.7003  Applicability.



208.7003-1  Assignments under integrated material management (IMM).

    (a) All items assigned for IMM must be acquired from the IMM manager 
except--
    (1) Items purchased under circumstances of unusual and compelling 
urgency as defined in FAR 6.302-2. After such a purchase is made, the 
requiring activity must send one copy of the contract and a statement of 
the emergency to the IMM manager;
    (2) Items for which the IMM manager assigns a supply system code for 
local purchase or otherwise grants authority to purchase locally; or
    (3) When purchase by the requiring activity is in the best interest 
of the Government in terms of the combination of quality, timeliness, 
and cost that best meets the requirement. This exception does not apply 
to items--
    (i) Critical to the safe operation of a weapon system;
    (ii) With special security characteristics; or
    (iii) Which are dangerous (e.g., explosives, munitions).
    (b) When an item assigned for IMM is to be acquired by the requiring 
activity under paragraph (a)(3) of this subsection, the contracting 
officer must--
    (1) Document the contract file with a statement of the specific 
advantage of local purchase for an acquisition exceeding the micro-
purchase threshold in FAR part 13; and
    (2) Ensure that a waiver is obtained from the IMM manager before 
initiating an acquisition exceeding the simplified acquisition threshold 
in FAR part 13, if the IMM assignment is to the General Services 
Administration (GSA), the Defense Logistics Agency (DLA), or the Army 
Materiel Command (AMC). Submit requests for waiver to--

(i) For GSA:
    Commissioner (F), Federal Supply Service, Washington, DC 20406
(ii) For DLA:
    Defense Construction Supply Center, ATTN: DCSC-BDA, P.O. Box 3990, 
Columbus, OH 43216-5000
    Defense Electronics Supply Center, ATTN: DESC-ERM, 1507 Wilmington 
Pike, Dayton, OH 45444-5000
    Defense Fuel Supply Center, ATTN: DFSC-OI, Cameron Station, VA 
22304-6160
    Defense General Supply Center, ATTN: DGSC-X, Richmond, VA 23297-5000
    Defense Industrial Supply Center, ATTN: DISC-OPD, 700 Robbins 
Avenue, Philadelphia, PA 19111-5096
    Defense Personnel Support Center, ATTN: DPSC-CSH, 2800 South 20th

[[Page 54]]

Street, P.O. Box 8419, Philadelphia, PA 19101-8419
(iii) For AMC:
    Commander, U.S. Army Materiel Command, ATTN: AMCLG-S, 5001 
Eisenhower Avenue, Alexandria, VA 22333-0001
[60 FR 61593, Nov. 30, 1995]



208.7003-2  Assignments under coordinated acquisition.

    Requiring departments must submit to the acquiring department all 
contracting requirements for items assigned for coordinated acquisition, 
except--
    (a) Items obtained through the sources in FAR 8.001(a)(1) (i) 
through (vii);
    (b) Items obtained under 208.7003-1(a);
    (c) Requirements not in excess of the simplified acquisition 
threshold in FAR part 13, when contracting by the requiring department 
is in the best interest of the Government;
    (d) In an emergency. When an emergency purchase is made, the 
requiring department must send one copy of the contract and a statement 
of the emergency to the contracting activity of the acquiring 
department;
    (e) Requirements for which the acquiring department's contracting 
activity delegates contracting authority to the requiring department;
    (f) Items in a research and development stage (as described in FAR 
part 35). Under this exception, the military departments may contract 
for research and development requirements, including quantities for 
testing purposes and items undergoing in-service evaluation (not yet in 
actual production, but beyond prototype). Generally, this exception 
applies only when research and development funds are used.
    (g) Items peculiar to nuclear ordnance material where design 
characteristics or test-inspection requirements are controlled by the 
Department of Energy (DoE) or by DoD to ensure reliability of nuclear 
weapons.
    (1) This exception applies to all items designed for and peculiar to 
nuclear ordnance regardless of agency control, or to any item which 
requires test or inspection conducted or controlled by DoE or DoD.
    (2) This exception does not cover items used for both nuclear 
ordnance and other purposes if the items are not subject to the special 
testing procedures.
    (h) Items to be acquired under FAR 6.302-6 (national security 
requires limitation of sources);
    (i) Items to be acquired under FAR 6.302-1 (supplies available only 
from the original source for follow-on contract);
    (j) Items directly related to a major system and which are design 
controlled by and acquired from either the system manufacturer or a 
manufacturer of a major subsystem;
    (k) Items subject to rapid design changes, or to continuous redesign 
or modification during the production and/or operational use phases, 
which require continual contact between industry and the requiring 
department to ensure that the item meets the requirements:
    (1) This exception permits the requiring department to contract for 
items of highly unstable design. For use of this exception, it must be 
clearly impractical, both technically and contractually, to refer the 
acquisition to the acquiring department. Anticipation that contracting 
by negotiation will be appropriate, or that a number of design changes 
may occur during contract performance is not in itself sufficient reason 
for using this exception.
    (2) This exception also applies to items requiring compatibility 
testing, provided such testing requires continual contact between 
industry and the requiring department;
    (l) Containers acquired only with items for which they are designed;
    (m) One-time buy of a noncataloged item.
    (1) This exception permits the requiring departments to contract for 
a nonrecurring requirement for a noncataloged item. This exception could 
cover a part or component for a prototype which may be stock numbered at 
a later date.
    (2) This exception does not permit acquisitions of recurring 
requirements for an item, based solely on the fact that the item is not 
stock numbered, nor may it be used to acquire items which have only 
slightly different

[[Page 55]]

characteristics than previously cataloged items.
[56 FR 36306, July 31, 1991, as amended at 60 FR 61593, Nov. 30, 1995]



208.7004  Procedures.



208.7004-1  Purchase authorization from requiring department.

    (a) Requiring departments send their requirements to acquiring 
departments on either a DD Form 448, Military Interdepartmental Purchase 
Request (MIPR), or a DD Form 416, Requisition for Coal, Coke or 
Briquettes. A MIPR or a DD Form 416 is the acquiring department's 
authority to acquire the supplies or services on behalf of the requiring 
department.
    (b) The acquiring department is authorized to create obligations 
against the funds cited in a MIPR without further referral to the 
requiring department. The acquiring department has no responsibility to 
determine the validity of a stated requirement in an approved MIPR, but 
it should bring apparent errors in the requirement to the attention of 
the requiring department.
    (c) Changes that affect the contents of the MIPR must be processed 
as a MIPR amendment regardless of the status of the MIPR. The requiring 
department may initially transmit changes electronically or by some 
other expedited means, but must confirm changes by a MIPR amendment.
    (d) The requiring department must submit requirements for additional 
line items of supplies or services not provided for in the original MIPR 
as a new MIPR. The requiring department may use a MIPR amendment for 
increased quantities only if--
    (1) The original MIPR requirements have not been released for 
solicitation; and
    (2) The acquiring department agrees.



208.7004-2  Acceptance by acquiring department.

    (a) Acquiring departments formally accept a MIPR by DD Form 448-2, 
Acceptance of MIPR, as soon as practicable, but no later than 30 days 
after receipt of the MIPR. If the 30 day time limit cannot be met, the 
acquiring department must inform the requiring department of the reason 
for the delay, and the anticipated date the MIPR will be accepted. The 
acquiring department must accept MIPRs in writing before expiration of 
the funds.
    (b) The acquiring department in accepting a MIPR will determine 
whether to use Category I (reimbursable funds citation) or Category II 
(direct funds citation) methods of funding.
    (1) Category I method of funding is used under the following 
circumstances and results in citing the funds of the acquiring 
department in the contract--
    (i) Delivery is from existing inventories of the acquiring 
department;
    (ii) Delivery is by diversion from existing contracts of the 
acquiring department;
    (iii) Production or assembly is through Government work orders in 
Government-owned plants;
    (iv) Production quantities are allocated among users from one or 
more contracts, and the identification of specific quantities of the end 
item to individual contracts is not feasible at the time of MIPR 
acceptance;
    (v) Acquisition of the end items involves separate acquisition of 
components to be assembled by the acquiring department;
    (vi) Payments will be made without reference to deliveries of end 
items (e.g., cost-reimbursement type contracts and fixed price contracts 
with progress payment clauses); or
    (vii) Category II method of funding is not feasible and economical.
    (2) Category II method of funding is used in circumstances other 
than those in paragraph (b)(1) of this subsection. Category II funding 
results in citation of the requiring department's funds and MIPR number 
in the resultant contract.
    (c) When the acquiring departments accepts a MIPR for Category I 
funding--
    (1) The DD Form 448-2, Acceptance of MIPR, is the authority for the 
requiring department to record the obligation of funds;
    (2) The acquiring department will annotate the DD Form 448-2 if 
contingencies, price revisions, or variations in quantities are 
anticipated. The acquiring department will periodically advise the 
requiring department, prior to submission of billings, of any

[[Page 56]]

changes in the acceptance figure so that the requiring department may 
issue an amendment to the MIPR, and the recorded obligation may be 
adjusted to reflect the current price;
    (3) If the acquiring department does not qualify the acceptance of a 
MIPR for anticipated contingencies, the price on the acceptance will be 
final and will be billed at time of delivery;
    (4) Upon receipt of the final billing (SF 1080, Voucher for 
Transferring Funds), the requiring department may adjust the fiscal 
records accordingly without authorization from or notice to the 
acquiring department.
    (d) When the MIPR is accepted for Category II funding, a conformed 
copy of the contract (see 204.802(1)(ii)) is the authority to record the 
obligation. When all awards have been placed to satisfy the total MIPR 
requirement, any unused funds remaining on the MIPR become excess to the 
acquiring department. The acquiring department will immediately notify 
the requiring department of the excess funds by submitting an Acceptance 
of MIPR (DD Form 448-2). This amendment is authorization for the 
requiring department to withdraw the funds. The acquiring department is 
prohibited from further use of such excess funds.
    (e) When the acquiring department requires additional funds to 
complete the contracting action for the requiring department, the 
request for additional funds must identify the exact items involved, and 
the reason why additional funds are required. The requiring department 
shall act quickly to--
    (1) Provide the funds by an amendment of the MIPR; or
    (2) Reduce the requirements.
    (f) The accepting activity of the acquiring department shall remain 
responsible for the MIPR even though that activity may split the MIPR 
into segments for action by other contracting activities.



208.7004-3  Use of advance MIPRs.

    (a) An advance MIPR is an unfunded MIPR provided to the acquiring 
department in advance of the funded MIPR so that initial steps in 
planning the contract action can begin at an earlier date.
    (b) In order to use an advance MIPR, the acquiring department and 
the requiring department must agree that its use will be beneficial. The 
departments may execute a blanket agreement to use advance MIPRs.
    (c) The requiring department shall not release an advance MIPR to 
the acquiring department without obtaining proper internal approval of 
the requirement.
    (d) When advance MIPRs are used, mark ``ADVANCE MIPR'' prominently 
on the DD Form 448.
    (e) For urgent requirements, the advance MIPR may be transmitted 
electronically.
    (f) On the basis of an advance MIPR, the acquiring department may 
take the initial steps toward awarding a contract, such as obtaining 
internal coordination and preparing an acquisition plan. Acquiring 
departments may determine the extent of these initial actions but shall 
not award contracts on the basis of advance MIPRs.



208.7004-4  Cutoff dates for submission of Category II MIPRs.

    (a) Unless otherwise agreed between the departments, May 31 is the 
cutoff date for the receipt of MIPRs citing expiring appropriations 
which must be obligated by September 30 of that fiscal year. If 
circumstances arise which require the submission of MIPRs citing 
expiring appropriations after the cutoff date, the requiring department 
will communicate with the acquiring department before submission to find 
out whether the acquiring department can execute a contract or otherwise 
obligate the funds by the end of the fiscal year. Acquiring departments 
will make every effort to obligate funds for all such MIPRs accepted 
after the cutoff date. However, acceptance of a late MIPR does not 
constitute assurance by the acquiring department that all such funds 
will be obligated.
    (b) Nothing in these instructions is intended to restrict the 
processing of MIPRs when the acquiring department is capable of 
executing contracts or otherwise obligating funds before the end of the 
fiscal year.
    (c) The May 31 cutoff date does not apply to MIPRs citing continuing 
appropriations.

[[Page 57]]



208.7004-5  Notification of inability to obligate on Category II MIPRs.

    On August 1, the acquiring department will advise the requiring 
department of any Category II MIPRs on hand citing expiring 
appropriations they will be unable to obligate prior to the fund 
expiration date. If an unforeseen situation develops after August 1 
which will prevent execution of a contract, the acquiring department 
will notify the requiring department as quickly as possible and return 
the MIPR. The letter of transmittal returning the MIPR will authorize 
purchase by the requiring department and state the reason that the 
acquisition could not be accomplished.



208.7004-6  Cancellation of requirements.

    (a) Category I MIPRs. The requiring department will notify the 
acquiring department by electronic or other immediate means when 
cancelling all or part of the supplies or services requested in the 
MIPR. Within 30 days, the acquiring department will notify the requiring 
department of the quantity of items available for termination and the 
amount of funds in excess of the estimated settlement costs. Upon 
receipt of this information, the requiring department will issue a MIPR 
amendment to reduce the quantities and funds accordingly.
    (b) Category II MIPRs. The requiring department will notify the 
acquiring department electronically or by other immediate means when 
cancelling all or any part of the supplies or services requested in the 
MIPR.
    (1) If the acquiring department has not entered into a contract for 
the supplies or services to be cancelled, the acquiring department will 
immediately notify the requiring department. Upon receipt of such 
notification, the requiring department shall initiate a MIPR amendment 
to revoke the estimated amount shown on the original MIPR for the 
cancelled items.
    (2) If the items to be cancelled have already been placed under 
contract--
    (i) As soon as practicable, but in no event more than 45 days after 
receipt of the cancellation notice from the requiring department, the 
contracting officer shall issue a termination data letter to the 
requiring department (original and four copies) containing, as a 
minimum, the information in Table 8-1, Termination Data Letter.
    (ii) The termination contracting officer (TCO) will review the 
proceedings at least every 60 days to reassess the Government's probable 
obligation. If any additional funds are excess to the probable 
settlement requirements, or if it appears that previous release of 
excess funds will result in a shortage of the amount which will be 
required for settlement, the TCO will promptly notify the contracting 
office which will amend the termination data letter. The requiring 
department will process a MIPR amendment to reflect the reinstatement of 
funds within 30 days after receiving the amended termination data 
letter.
    (iii) Upon receipt of a copy of the termination settlement 
agreement, the requiring department will prepare a MIPR amendment, if 
required, to remove any remaining excess funds.

                   Table 8-1, Termination Data Letter                   
                                                                        
                                                                        
  SUBJECT: Termination Data Re:                                         
  Contract No. ____________                                             
  Termination No. ____________                                          
  Contract ____________                                                 
  (a) As termination action is now in progress on the above contract,   
 the following information is submitted:                                
  (1) Brief Description of items terminated.                            
  (2) You are notified that the sum of $________ is available for       
 release under the subject contract. This sum represents the difference 
 between $________, the value of items terminated under the contract,   
 and $________, estimated to be required for settlement of the          
 terminated contract. The estimated amount available for release is     
 allocated by the appropriations cited on the contract as follows:      
  MIPR NO. ________ ACCOUNTING CLASSIFICATION ________ AMOUNT ________  
  Total available for release at this time $________                    
  (b) Request you forward an amendment to MIPR ________ on DD Form 448-2
 to reflect the reduced quantity and amount of funds available for      
 release.                                                               
  (c) Periodic reviews (not less than 60 days) will be made as          
 termination proceedings progress to redetermine the Government's       
 probable obligation.                                                   
  ________________________________________                              
  Contracting Officer                                                   
------------------------------------------------------------------------


[[Page 58]]



208.7004-7  Termination for default.

    (a) When the acquiring department terminates a contract for default, 
they will ask the requiring department if the supplies or services to be 
terminated are still required so that repurchase action can be started.
    (b) The requiring department will not deobligate funds on a contract 
terminated for default until receipt of a settlement modification or 
other written evidence from the acquiring department authorizing release 
of funds.
    (c) On the repurchase action, the acquiring department will not 
exceed the unliquidated funds on the defaulted contract without 
receiving additional funds from the requiring department.



208.7004-8  Transportation funding.

    The requiring department will advise the acquiring department or the 
transportation officer in the contract administration office of the fund 
account to be charged for transportation costs. The requiring department 
may cite the fund account on each MIPR or provide the funding cite to 
the transportation officer at the beginning of each fiscal year for use 
on Government bills of lading. When issuing a Government bill of lading, 
show the requiring department as the department to be billed and cite 
the appropriate fund account.



208.7004-9  Status reporting.

    (a) The acquiring department will maintain a system of MIPR follow 
up to inform the requiring department of the current status of its 
requests. In addition, the contract administration office will maintain 
a system of follow up in order to advise the acquiring department on 
contract performance.
    (b) If requested by the requiring department, the acquiring 
department will furnish the requiring department a copy of the 
solicitation when the MIPR is satisfied through Category II funding.
    (c) Any reimbursement billings, shipping document, contractual 
documents, project orders, or related documentation furnished to the 
requiring department will identify the requiring department's MIPR 
number, quantities of items, and funding information.



208.7004-10  Administrative costs.

    The acquiring department bears the administrative costs of acquiring 
supplies for the requiring department. However, when an acquisition 
responsibility is transferred to another department, funds appropriated 
or to be appropriated for administrative costs will transfer to the 
successor acquiring department. The new acquiring department must assume 
budget cognizance as soon as possible.



208.7005  MIPRs.

    Instructions on preparation and use of DD Form 448, Military 
Interdepartmental Purchase Request, and DD Form 448-2, Acceptance of 
MIPR, are in 253.208.



208.7006  Coordinated acquisition assignments.

    See appendix B for coordinated acquisition assignments.



     Subpart 208.71--Acquisition for National Aeronautics and Space 
                          Administration (NASA)



208.7100  Authorization.

    NASA is authorized by Public Law 85-568 to use the acquisition 
services, personnel, equipment, and facilities of DoD departments and 
agencies with their consent, with or without reimbursement, and on a 
similar basis to cooperate with the departments/agencies in the use of 
acquisition services, equipment, and facilities.



208.7101  Policy.

    Departments and agencies will--
    (a) Cooperate fully with NASA in making acquisition services, 
equipment, personnel, and facilities available on the basis of mutual 
agreement.
    (b) Not claim reimbursement for administrative costs incident to 
acquisitions for NASA, unless agreed otherwise prior to the time 
services are performed.



208.7102  Procedures.

    (a) When contracting or performing field service functions for NASA, 
the departments and agencies will use

[[Page 59]]

their own methods, except when otherwise required by the terms of the 
agreement.
    (b) Departments and agencies normally will use their own funds when 
contracting for or performing services for NASA and will not cite NASA 
funds on any defense obligation or payment document.



208.7103  Purchase request and acceptance.

    (a) NASA will use NASA Form 523, NASA-Defense Purchase Request, to 
request acquisition of supplies or services.
    (b) Except as provided in paragraph (d) of this section, departments 
and agencies will respond within 30 days to a NASA purchase request by 
forwarding DD Form 448-2, Acceptance of MIPR. Forward each DD Form 448-2 
in quadruplicate and indicate action status as well as the name and 
address of the DoD acquisition activity for future use by the NASA 
initiator.
    (c) To the extent feasible, all documents related to the NASA action 
will reference the NASA-Defense Purchase Request number and the item 
number when appropriate.
    (d) Departments and agencies are not required to accept NASA-Defense 
Purchase Requests for common-use standard stock items which the 
supplying department has on hand or on order for prompt delivery at 
published prices.



208.7104  Changes in estimated total prices.

    When a department or agency determines that the estimated total 
price (Block 6F, NASA Form 523) for NASA items is not sufficient to 
cover the required reimbursement, or is in excess of the amount 
required, the department/agency will forward a request for amendment to 
the NASA originating office. Indicate in the request a specific dollar 
amount, rather than a percentage, and include justification for any 
upward adjustment requested. Upon approval of a request, NASA will 
forward an amendment of its purchase request to the contracting 
activity.



208.7105  Payments.

    Departments and agencies will submit SF 1080, Voucher for 
Transferring Funds, billings to the NASA office designated in Block 9 of 
the NASA-Defense Purchase Request, except where agreements provide that 
reimbursement is not required. Departments and agencies will support 
billings in the same manner as billings between departments and 
agencies.



       Subpart 208.72--Industrial Preparedness Production Planning



208.7201  Definitions.

    As used in this subpart--
    Industrial base means that part of the total privately-owned and 
Government-owned industrial production and maintenance capacity of the 
United States and Canada, which will be available during national 
emergencies to manufacture and repair items required by the departments.
    Industrial preparedness production planning means planning designed 
to maintain an adequate industrial base to support DoD requirements for 
selected essential military items in a national emergency.
    National emergency means a condition declared by the President or 
the Congress which authorizes certain emergency action in the national 
interest, including partial or total mobilization of national resources.
    Planned item means any item selected for industrial preparedness 
planning under the criteria of DoDI 4005.3, Industrial Preparedness 
Planning.
    Planned producer means an industrial firm which has agreed by either 
non-binding memorandum of understanding or binding contract/contract 
clause to provide production capacity data, to maintain existing 
capacity for a negotiated period of time, and to accept contracts for 
planned items upon the request of the Government.



208.7202  General.

    (a) Under the Industrial Preparedness Production Planning (IPPP) 
program, DoD components and industry work together to ensure essential 
military items are available during an emergency.
    (b) Departments and agencies select weapon systems and items for 
planning in accordance with DoDI 4005.3, Industrial Preparedness 
Planning. Planning

[[Page 60]]

is conducted only with U.S. or Canadian sources.
    (c) The use of privately-owned facilities is preferred to minimize 
the need for Government investment. Departments and agencies will 
include Government-owned production facilities in the industrial base 
only when--
    (1) Private industry is unable to provide the facilities necessary 
to support DoD requirements; or
    (2) The facilities are necessary--
    (i) For reasons of national security; or
    (ii) To ensure a quick response capability to meet fluctuating 
demands.



208.7203  Authority.

    Authority under current contracting procedures to accomplish 
industrial planning actions includes--
    (a) Leasing of Government-owned property to planned emergency 
producers under the authority of the Military Leasing Act of 1947, 10 
U.S.C. 2667;
    (b) Acquisitions in the interest of national defense under FAR 
6.202(a)(2), or in case of a national emergency or to achieve industrial 
mobilization under FAR 6.302-3;
    (c) Acquisition of items restricted under 225.7010 and 225.71;
    (d) Use of multiyear contracting (FAR subpart 17.1);
    (e) Providing Government production and research property to 
contractors; and
    (f) Use of direct payment for idle facilities or idle capacities 
reserved for defense mobilization production (FAR 31.205-17(d)).
[56 FR 36306, July 31, 1991, as amended at 57 FR 42629, Sept. 15, 1992; 
62 FR 34121, June 24, 1997]



208.7204  Procedures.

    (a) Planned producers shall be solicited for all acquisitions of 
their planned items, when the acquisition is over the small purchase 
threshold in FAR 13.000, except as provided in FAR or DFARS.
    (b) The contracting officer may contract for industrial planning 
efforts for selected essential military items. These efforts may 
include, but are not limited to, the maintenance of Government-owned 
industrial facilities (real and personal property) or production data 
packages. These planning efforts may be acquired through an individual 
service contract or as a line item on a contract for a planned item.



         Subpart 208.73--Use of Government-Owned Precious Metals



208.7301  Definitions.

    As used in this subpart--
    Defense Industrial Supply Center (DISC) means the Defense Logistics 
Agency field activity located at 700 Robbins Avenue, Philadelphia, PA 
19111-5096, which is the assigned commodity integrated material manager 
for refined precious metals and is responsible for the storage and issue 
of such material.
    Dual pricing evaluation procedure means a procedure where offerors 
submit two prices for precious metals bearing items--one based on 
Government-furnished precious metals and one based on contractor-
furnished precious metals. The contracting officer evaluates the prices 
to determine which is in the Government's best interest.
    Precious Metals Indicator Code (PMIC) means a single digit, alpha-
numeric code assigned to national stock numbered items in The Defense 
Integrated Data System Total Item Record used to indicate the presence 
or absence of precious metals in the item. PMICs and the content value 
of corresponding items are listed in DoDD 4100.39M, Defense Integrated 
Data System (DIDS) Procedures Manual, chapter 10, Table 160.
    Refined precious metal means recovered silver, gold, platinum, 
palladium, iridium, rhodium, or ruthenium, in bullion, granulation or 
sponge form, which has been purified to at least .999 percentage of 
fineness.



208.7302  Policy.

    DoD policy is for maximum participation in the Precious Metals 
Recovery Program (PMRP). DoD components shall furnish recovered precious 
metals contained in the DISC inventory to production contractors rather 
than use contractor-furnished precious metals whenever the contracting 
officer determines it to be in the Government's best

[[Page 61]]

interest. (See DoDD 4160.22, Recovery and Utilization of Precious 
Metals.)



208.7303  Procedures.

    (a) Item managers and contracting officers will use the PMIC and/or 
other relevant data furnished with a purchase request to determine the 
applicability of this subpart.
    (b) When an offeror advises of a precious metals requirement, the 
contracting officer shall use the procedures in chapter X of DoD 
4160.21-M, Defense Utilization and Disposal Manual, to determine 
availability of required precious metal assets and current government-
furnished materiel (GFM) unit prices. If the precious metals are 
available, the contracting officer shall evaluate offers and award the 
contract on the basis of the offer which is in the best interest of the 
Government.
    (c) When the clause prescribed by 208.7305 is included in a 
solicitation, the contracting officer will ensure that section B, 
Schedule of Supplies or Services and Prices, is structured to--
    (1) Permit insertion of alternate prices for each deliverable 
contract line item number that uses precious metals; and
    (2) Use dual pricing evaluation procedures.



208.7304  Refined precious metals.

    The following refined precious metals are currently managed by DISC:

                                                                        
------------------------------------------------------------------------
                                                      National Stock No.
                   Precious metal                            (NSN)      
------------------------------------------------------------------------
Silver Bullion/Granules.............................    9660-00-106-9432
Gold Bullion/Granules...............................    9660-00-042-7733
Platinum Granules...................................    9660-00-042-7768
Platinum Sponge.....................................    9660-00-151-4050
Palladium Granules..................................    9660-00-042-7765
Palladium Sponge....................................    9660-01-011-0320
Rhodium Sponge......................................    9660-01-011-2625
Iridium Sponge......................................    9660-01-011-1937
Ruthenium Sponge....................................    9660-01-039-0313
------------------------------------------------------------------------



208.7305  Contract clause.

    (a) Use the clause at 252.208-7000, Intent to Furnish Precious 
Metals as Government-Furnished Material, in all solicitations and 
contracts except--
    (1) When the contracting officer has determined that the required 
precious metals are not available from DISC;
    (2) When the contracting officer knows that the items being acquired 
do not require precious metals in their manufacture; or
    (3) For acquisitions below the small purchase threshold in FAR 
13.000.
    (b) To make the determination in paragraph (a)(1) of this section, 
the contracting officer shall consult with the end item inventory 
manager and comply with the procedures in Chapter X, DoD 4160.21-M, 
Defense Utilization and Disposal Manual.



PART 209--CONTRACTOR QUALIFICATIONS--Table of Contents




Sec.

           Subpart 209.1--Responsible Prospective Contractors

209.101  Definitions.
209.103  Policy.
209.103-70  Contract clause.
209.104  Standards.
209.104-1  General standards.
209.104-4  Subcontractor responsibility.
209.104-70  Solicitation provisions.
209.106  Preaward surveys.
209.106-1  Conditions for preaward surveys.
209.106-2  Requests for preaward surveys.

               Subpart 209.2--Qualifications Requirements

209.202  Policy.

            Subpart 209.3--First Article Testing and Approval

209.303  Use.
209.305  Risk.
209.306  Solicitation requirements.
209.308  Contract clauses.

         Subpart 209.4--Debarment, Suspension, and Ineligibility

209.402  Policy.
209.403  Definitions.
209.405  Effect of listing.
209.405-1  Continuation of current contracts.
209.406  Debarment.
209.406-1  General.
209.406-2  Causes for debarment.
209.406-3  Procedures.
209.470  Military recruiting on campus.
209.470-1  Policy.
209.470-2  Procedures.
209.470-3  Contract clause.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36313, July 31, 1991, unless otherwise noted.

[[Page 62]]



           Subpart 209.1--Responsible Prospective Contractors



209.101  Definitions.

    ``Entity controlled by a foreign government,'' ``foreign 
government,'' and ``proscribed information,'' are defined in the 
provision at 252.209-7002, Disclosure of Ownership or Control by a 
Foreign Government.
[59 FR 51132, Oct. 7, 1994]



209.103  Policy.

    (a)(i) Do not deny award to contractors subject to on-site 
inspection under the Intermediate-Range Nuclear Forces (INF) Treaty, or 
similar treaty, due to the actual or potential presence of Soviet 
inspectors at the contractor's facility unless--
    (A) Necessary for reasons of national security;
    (B) The decision is based on full information, including comment 
from the potential contractor or subcontractor on the security issues 
involved; and
    (C) The department or agency acquisition executive reviews the 
decision and the Under Secretary of Defense (Acquisition & Technology) 
approves the decision.
    (ii) Make any decision to deny consideration for award under 
paragraph (a)(i) of this section as early as possible in the acquisition 
process. Notify the firm in writing of any decision not to consider the 
firm for award of a contract or subcontract.
    (c) The additional cost of contract administration and audit due to 
a contractor's performance risk may be considered in evaluating the 
contractor's price.
[56 FR 36313, July 31, 1991, as amended at 60 FR 29497, June 5, 1995; 61 
FR 50452, Sept. 26, 1996]



209.103-70  Contract clause.

    Use the clause at 252.209-7000, Acquisition from Subcontractors 
Subject to On-Site Inspection Under the Intermediate-Range Nuclear 
Forces (INF) Treaty, in all solicitations and contracts exceeding the 
simplified acquisition threshold, except solicitations and contracts for 
commercial items.
[60 FR 61593, Nov. 30, 1995, as amended at 61 FR 50452, Sept. 26, 1996]



209.104  Standards.



209.104-1  General standards.

    (e) For cost-reimbursement or incentive type contracts, or contracts 
which provide for progress payments based on costs or on a percentage or 
stage of completion, the prospective contractor's accounting system and 
related internal controls must provide reasonable assurance that--
    (i) Applicable laws and regulations are complied with;
    (ii) The accounting system and cost data are reliable;
    (iii) Risk of misallocations and mischarges are minimized; and
    (iv) Contract allocations and charges are consistent with invoice 
procedures.
    (g)(i) Ownership or control by the government of a terrorist 
country. (A) Under 10 U.S.C. 2327(b), a contracting officer shall not 
award a contract to a firm or to a subsidiary of a firm when a foreign 
government--
    (1) Either directly or indirectly, has a significant interest--
    (i) In the firm; or
    (ii) In the subsidiary; and
    (2) Has been determined by the Secretary of State under 50 U.S.C. 
App. 2405(j)(1)(A) to be a government of a country that has repeatedly 
provided support for acts of international terrorism.
    (B) The Secretary of Defense may waive the prohibition in paragraph 
(g)(i)(A) of this subsection in accordance with 10 U.S.C. 2327(c). This 
waiver authority may not be delegated.
    (ii) Ownership or control by a foreign government when access to 
proscribed information is required to perform the contract. (A) Under 10 
U.S.C. 2536(a), no DoD contract under a national security program may be 
awarded to an entity controlled by a foreign government if that entity 
requires access to proscribed information to perform the contract.
    (B) Whenever the contracting officer has a question about 
application of the provision at 252.209-7002, the contracting officer 
may seek advice from the Director, Defense Security Programs, Office of 
the Assistant Secretary of Defense for Command, Control, Communications 
and Intelligence.

[[Page 63]]

    (C) In accordance with 10 U.S.C. 2536(b)(1)(A), the Secretary of 
Defense may waive the prohibition in paragraph (g)(ii)(A) of this 
subsection upon determining that the waiver is essential to the national 
security interest of the United States. The Secretary has delegated 
authority to grant this waiver to the Assistant Secretary of Defense 
Command, Control, Communications and Intelligence. Waiver requests, 
prepared by the requiring activity in coordination with the contracting 
officer, shall be processed through the Director of Defense Procurement, 
Office of the Under Secretary of Defense (Acquisition & Technology), and 
shall include a proposed national interest determination. The proposed 
national interest determination, prepared by the requiring activity in 
coordination with the contracting officer, shall include:
    (1) Identification of the proposed awardee, with a synopsis of its 
foreign ownership (include solicitation and other reference numbers to 
identify the action);
    (2) General description of the acquisition and performance 
requirements;
    (3) Identification of the national security interests involved and 
the ways award of the contract helps advance those interests;
    (4) The availability of another entity with the capacity, capability 
and technical expertise to satisfy defense acquisition, technology base, 
or industrial base requirements; and
    (5) A description of any alternate means available to satisfy the 
requirement, e.g., use of substitute products or technology or alternate 
approaches to accomplish the program objectives.
    (D) In accordance with 10 U.S.C. 2536(b)(1)(B), the Secretary of 
Defense may, in the case of a contract awarded for environmental 
restoration, remediation, or waste management at a DoD facility, waive 
the prohibition in paragraph (g)(ii)(A) of this subsection upon--
    (1) Determining that--
    (i) The waiver will advance the environmental restoration, 
remediation, or waste management objectives of DoD and will not harm the 
national security interests of the United States; and
    (ii) The entity to which the contract is awarded is controlled by a 
foreign government with which the Secretary is authorized to exchange 
Restricted Data under section 144c. of the Atomic Energy Act of 1954 (42 
U.S.C. 2164(c)); and
    (2) Notifying Congress of the decision to grant the waiver. The 
contract may be awarded only after the end of the 45-day period 
beginning on the date the notification is received by the appropriate 
Congressional committees.
[58 FR 28464, May 13, 1993, as amended at 59 FR 51131, 51132, Oct. 7, 
1994; 60 FR 29497, June 5, 1995; 62 FR 34121, June 24, 1997]



209.104-4  Subcontractor responsibility.

    Generally, the Canadian Commercial Corporation's (CCC) proposal of a 
firm as its subcontractor is sufficient basis for an affirmative 
determination of responsibility. However, when the CCC determination of 
responsibility is not consistent with other information available to the 
contracting officer, the contracting officer shall request from CCC and 
any other sources whatever additional information is necessary to make 
the responsibility determination.



209.104-70  Solicitation provisions.

    (a) Use the provision at 252.209-7001, Disclosure of Ownership or 
Control by the Government of a Terrorist Country, in all solicitations 
expected to result in contracts of $100,000 or more.
    (b) Use the provision at 252.209-7002, Disclosure of Ownership or 
Control by a Foreign Government, in all solicitations, including those 
subject to the procedures in FAR part 13, when access to proscribed 
information is necessary to perform a DoD contract under a national 
security program.
[58 FR 28464, May 13, 1993, as amended at 59 FR 51131, Oct. 7, 1994; 62 
FR 34122, June 24, 1997]



209.106  Preaward surveys.



209.106-1  Conditions for preaward surveys.

    (a) If a preaward survey is requested, include the rationale in 
block 23 of the SF 1403, Preaward Survey of Prospective Contractor 
(General).
[60 FR 61593, Nov. 30, 1995]

[[Page 64]]



209.106-2  Requests for preaward surveys.

    (1) The surveying activity is the cognizant contract administration 
office as listed in DLAH 4105.4, DoD Directory of Contract 
Administration Services Components. When information is required as part 
of the survey on the adequacy of the contractor's accounting system or 
its suitability for administration of the proposed type of contract, the 
surveying activity will obtain the information from the auditor.
    (2) Limited information may be requested by telephone.
    (3) The contracting officer may request a formal survey by telephone 
but must confirm immediately with SF 1403, Preaward Survey of 
Prospective Contractor (General). For a formal survey, send original and 
three copies of SF 1403, including necessary drawings and 
specifications.
    (a) List additional factors in item H, section III of the SF 1403 
and explain them in block 23. For example--
    (i) Information needed to determine a prospective contractor's 
eligibility under the Walsh-Healey Public Contracts Act. (Note that the 
Walsh-Healey Public Contracts Act, block 12 of section I, only indicates 
what the contractor has represented its classification to be under 
Walsh-Healey.)
    (ii) Evaluation of a contractor as a planned producer when the 
offered item is or may appear on the Industrial Preparedness Planning 
List (IPPL). When the preaward survey results in a recommendation for 
award, ask the office responsible for industrial preparedness planning 
to consider designating the prospective contractor as a planned 
producer. If the item is already on the IPPL or the prospective 
contractor is already a planned producer, note the information in block 
23.
    (iii) Evaluation of the prospective contractor's performance against 
small business subcontracting plans.
    (c) On base level preaward surveys, technical personnel from the 
requiring installation should participate when there is concern about 
the ability of a prospective contractor to perform a base level service 
or construction contract.
    (d) Allow more time for--
    (i) Complex items;
    (ii) New or inexperienced DoD contractors; and
    (iii) Surveys with time-consuming requirements, e.g., secondary 
survey, accounting system review, financial capability analysis, or 
purchasing office participation.
    (e) Only request those factors essential to the determination of 
responsibility. See 253.209-1(a) for an explanation of the factors in 
section III, blocks 19 and 20 of the SF 1403.
[56 FR 36313, July 31, 1991, as amended at 58 FR 28464, May 13, 1993]



               Subpart 209.2--Qualifications Requirements



209.202  Policy.

    (a)(1) The inclusion of qualification requirements in specifications 
for products which are to be included on a Qualified Products List, or 
manufactured by business firms included on a Qualified Manufacturers 
List, requires approval by the departmental standardization office in 
accordance with DoD Manual 4120.3-M, Defense Standardization Program 
Policies and Procedures. The inclusion of other qualification 
requirements in an acquisition or group of acquisitions requires 
approval by the chief of the contracting office.
[60 FR 61593, Nov. 30, 1995]



            Subpart 209.3--First Article Testing and Approval



209.303  Use.

    (d) The contracting officer may require that first articles be 
manufactured using the same facilities, production processes, methods, 
and materials to be used for production units under the contract.



209.305  Risk.

    The contracting officer may give this authorization to a contractor 
only after approval by a level higher than the contracting officer.



209.306  Solicitation requirements.

    (a)(1) To be sure that the contractor and the Government clearly 
understand and interpret contract terms and conditions in the same 
manner, avoid

[[Page 65]]

describing first article requirements exclusively in general terms such 
as ``visual,'' ``dimensional,'' ``workmanship,'' or ``specification 
compliance.''



209.308  Contract clauses.

    Alternate I of the clauses at FAR 52.209-3, First Article Approval--
Contractor Testing, or 52.209-4, First Article Approval--Government 
Testing, as appropriate, may be used when--
    (1) The form, fit, or function of the product would be adversely 
affected by contractor changes in the production facilities, processes, 
methods, or materials subsequent to first article approval; and
    (2) The Government has relied upon first article testing in the 
absence of complete design specifications to supplement a performance 
specification; or
    (3) It is essential to have an approved first article to serve as a 
manufacturing standard.



         Subpart 209.4--Debarment, Suspension, and Ineligibility



209.402  Policy.

    (d) The uniform suspension and debarment procedures to be followed 
by all debarring and suspending officials are set out in appendix H to 
this chapter.
    (e) The department or agency shall provide a copy of the Debarment 
and Suspension Procedures at DFARS appendix H to this chapter to 
contractors at the time of their suspension or when they are proposed 
for debarment, and upon request to other interested parties.
[59 FR 27668, May 27, 1994]



209.403  Definitions.

    Debarring official. (1) For DoD, the designees are--

Army--Commander, U.S. Army Legal Services Agency
Navy--the General Counsel of the Department of the Navy
Air Force--Deputy General Counsel (Contractor Responsibility)
Defense Advanced Research Projects Agency--The Director
Defense Information Systems Agency--The General Counsel
Defense Logistics Agency--The Special Assistant for Contracting 
Integrity
Defense Mapping Agency--The General Counsel
Defense Special Weapons Agency--The Director
National Security Agency--The Director
Ballistic Missile Defense Organization--The General Counsel
Overseas installations--as designated by the agency head

    (2) Overseas debarring officials--
    (i) Are authorized to debar or suspend contractors located within 
the official's geographic area of responsibility under any delegation of 
authority they receive from their agency head.
    (ii) Debar or suspend in accordance with the procedures in FAR 
subpart 9.4 or under modified procedures approved by the agency head 
based on consideration of the laws or customs of the foreign countries 
concerned.
    (iii) In addition to the bases for debarment in FAR 9.406-2, may 
consider the following additional bases--
    (A) The foreign country concerned determines that a contractor has 
engaged in bid-rigging, price-fixing, or other anti-competitive 
behavior; or
    (B) The foreign country concerned declares the contractor to be 
formally debarred, suspended, or otherwise ineligible to contract with 
that foreign government or its instrumentalities.
[56 FR 36313, July 31, 1991, as amended at 56 FR 67212, Dec. 30, 1991; 
59 FR 27669, May 27, 1994; 60 FR 61593, Nov. 30, 1995; 61 FR 50452, 
Sept. 26, 1996]



209.405  Effect of listing.

    Under 10 U.S.C. 2393b, when a department or agency determines that a 
compelling reason exists for it to conduct business with a contractor 
that is on the list of parties excluded from procurement programs, it 
shall provide written notice of the determination to the General 
Services Administration, Office of Acquisition Policy. Examples of 
compelling reasons are--
    (1) Only a listed contractor can provide the supplies or services;
    (2) Urgency requires contracting with a listed contractor;
    (3) The contractor and a department or agency have an agreement 
covering the same events which resulted in the listing and the agreement 
includes the

[[Page 66]]

department/agency decision not to debar or suspend the contractor; or
    (4) The national defense requires continued business dealings with 
the listed contractor.



209.405-1  Continuation of current contracts.

    (b) Unless the agency head makes a written determination that a 
compelling reason exists to do so, ordering activities shall not--
    (i) Place orders exceeding the guaranteed minimum under indefinite 
quantity contracts: or
    (ii) When the agency is an optional user, place orders against 
Federal Supply Schedule contracts.
    (c) This includes exercise of options.
[60 FR 29497, June 5, 1995, as amended at 60 FR 61593, Nov. 30, 1995]



209.406  Debarment.



209.406-1  General.

    (a)(i) When the debarring official decides that debarment is not 
necessary, the official may require the contractor to enter into a 
written agreement which includes--
    (A) A requirement for the contractor to establish, if not already 
established, and to maintain the standards of conduct and internal 
control systems prescribed by subpart 203.70; and
    (B) Other requirements the debarring official considers appropriate.
    (ii) Before the debarring official decides not to suspend or debar 
in the case of an indictment or conviction for a felony, the debarring 
official must determine that the contractor has addressed adequately the 
circumstances that gave rise to the misconduct, and that appropriate 
standards of ethics and integrity are in place and are working.
[57 FR 14992, Apr. 23, 1992]



209.406-2  Causes for debarment.

    (a) Any person shall be considered for debarment if criminally 
convicted of intentionally affixing a label bearing a ``Made in 
America'' inscription to any product sold in or shipped to the United 
States that was not made in America (10 U.S.C. 2410f).
    (i) The debarring official will make a determination concerning 
debarment not later than 90 days after determining that a person has 
been so convicted.
    (ii) In cases where the debarring official decides not to debar, the 
debarring official will report that decision to the Director of Defense 
Procurement who will notify Congress within 30 days after the decision 
is made.
[58 FR 28464, May 13, 1993]



209.406-3  Procedures.

    (a) Investigation and referral. (i) The contracting officer shall 
prepare a report containing the information required by paragraph 
(a)(ii) of this subsection when--
    (A) A contractor has committed, or is suspected of having committed, 
any of the acts described in FAR 9.406-2 and 9.407-2;
    (B) FAR 49.106 requires a report;
    (C) Part 203 requires a report;
    (D) The Government suspects a contractor of violating the Buy 
American Act (see FAR 25.204); or
    (E) The Government suspects a contractor of attempting to evade the 
prohibitions of debarment or suspension by changes of address, multiple 
addresses, formation of new companies, or by other devices.
    (ii) Include the following information, when available, in the 
report required by paragraph (a)(i) of this subsection--
    (A) Name, address, and telephone number of the point of contact for 
the activity making the report;
    (B) Name, contractor and Government entity (CAGE) code, and address 
of the contractor;
    (C) Name and addresses of the members of the board, principal 
officers, partners, owners, and managers;
    (D) Name and addresses of all known affiliates, subsidiaries, or 
parent firms, and the nature of the business relationship;
    (E) For each contract affected by the conduct being reported--
    (1) The contract number;
    (2) All office identifying numbers or symbols;
    (3) Description of supplies or services;
    (4) The amount;
    (5) The percentage of completion;
    (6) The amount paid the contractor;

[[Page 67]]

    (7) Whether the contract is assigned under the Assignment of Claims 
Act and, if so, to whom; and
    (8) The amount due the contractor;
    (F) For any other contracts outstanding with the contractor or any 
of its affiliates--
    (1) The contract number;
    (2) The amount;
    (3) The amounts paid the contractor;
    (4) Whether the contract is assigned under the Assignment of Claims 
Act and, if so, to whom; and
    (5) The amount due the contractor;
    (G) A complete summary of all pertinent evidence and the status of 
any legal proceedings involving the contractor;
    (H) An estimate of any damages sustained by the Government as a 
result of the contractor's action (explain how the estimate was 
calculated);
    (I) The comments and recommendations of the contracting officer and 
of each higher level contracting review authority regarding--
    (1) Whether to suspend or debar the contractor;
    (2) Whether to apply limitations to the suspension or debarment;
    (3) The period of any recommended debarment; and
    (4) Whether to continue any current contracts with the contractor 
(explain why a recommendation regarding current contracts is not 
included);
    (J) When appropriate, as an enclosure to the report--
    (1) A copy or extracts of each pertinent contract;
    (2) Witness statements or affidavits;
    (3) Copies of investigative reports;
    (4) Certified copies of indictments, judgments, and sentencing 
actions; and
    (5) Any other appropriate exhibits or documentation.
    (iii) Send three copies of each report, including enclosures, to the 
debarring official in 209.403.



209.470  Military recruiting on campus.



209.470-1  Policy.

    (a)(1) Section 558 of the National Defense Authorization Act for 
Fiscal Year 1995 (Public Law 103-337) provides that no funds available 
to DoD may be provided by grant or contract to any institution of higher 
education that has a policy of denying or that effectively prevents the 
Secretary of Defense from obtaining for military recruiting purposes--
    (i) Entry to campuses or access to students on campuses; or
    (ii) Access to directory information pertaining to students.
    (2) Section 541 of the National Defense Authorization Act for Fiscal 
Year 1996 (10 U.S.C. 983) provides that no funds appropriated or 
otherwise available to DoD may be obligated by contract or by grant, 
including a grant of funds to be available for student aid, to any 
institution of higher education that, as determined by the Secretary of 
Defense, has an anti-ROTC policy and at which, as determined by the 
Secretary, the Secretary would otherwise maintain or seek to establish a 
unit of the Senior Reserve Officer Training Corps, or at which the 
Secretary would otherwise enroll or seek to enroll students for 
participation in a unit of the Senior Reserve Officer Training Corps at 
another nearby institution of higher education. This prohibition applies 
to new contracts and all contract modifications. (See 243.105.) This 
prohibition shall cease to apply to that institution upon a 
determination by the Secretary that the institution no longer has an 
anti-ROTC policy.
    (b) Institutions of higher education that are determined under 32 
CFR part 216 to have the policy or practice in paragraph (a)(1) or 
(a)(2) of this subsection shall be listed as ineligible on the List of 
Parties Excluded from Federal Procurement and Nonprocurement Programs 
published by the General Services Administration. (See FAR 9.404.)
    (c) In cases where a determination is made under 32 CFR part 216 
that specific subordinate elements of an institution of higher 
education, rather than the institution as a whole, have the policy or 
practice in paragraph (a)(1) or (a)(2) of this subsection, 32 CFR part 
216 provides that the prohibition on use of DoD funds applies only to 
those subordinate elements.
[61 FR 25408, May 21, 1996]



209.470-2  Procedures.

    (a) Agencies shall not solicit offers from, award contracts to, or 
consent to

[[Page 68]]

subcontracts with ineligible contractors.
    (b) After a determination of ineligibility under 209.470-1(a)(1), 
departments and agencies shall make no further payments under existing 
contracts with the institutions, and shall initiate termination action.
[61 FR 25408, May 21, 1996]



209.470-3  Contract clause.

    Use the clause at 252.209-7005, Military Recruiting on Campus, in 
all solicitations and contracts with institutions of higher education.
[60 FR 13074, Mar. 10, 1995, as amended at 60 FR 51693, Nov. 30, 1995]



PART 211--DESCRIBING AGENCY NEEDS--Table of Contents




Sec.
211.002  Policy.
211.002-70  Contract clause.

       Subpart 211.2--Using and Maintaining Requirements Documents

211.201  Identification and availability of specifications.
211.204  Solicitation provisions and contract clauses.
211.270  Brand name or equal purchase descriptions.
211.270-1  Policy.
211.270-2  Solicitation provision.
211.271  Elimination of use of class I ozone-depleting substances.
211.272  Alternate preservation, packaging, and packing.
211.273  Substitutions for military or Federal specifications and 
          standards.
211.273-1  Definition.
211.273-2  Policy.
211.273-3  Procedures.
211.273-4  Contract clause.

                    Subpart 211.5--Liquidated Damages

211.504  Contract clauses.

                Subpart 211.6--Priorities and Allocations

211.602  General.

    Authority:  41 U.S.C. 421 and 48 CFR Chapter 1.

    Source:  60 FR 61594, Nov. 30, 1995, unless otherwise noted.



211.002  Policy

    All systems acquisition programs in the DoD are subject to the 
acquisition streamlining policies and procedures in DoDI 5000.2, Defense 
Acquisition Management Policies and Procedures.



211.002-70  Contract clause.

    Use the clause at 252.211-7000, Acquisition Streamlining, in all 
solicitations and contracts for systems acquisition programs.
    Subpart 211.2--Using and Maintaining Requirements Documents



211.201  Identification and availability of specifications.

    (a) The DoD index of data item descriptions is DoD 5010.12-L, 
Acquisition Management Systems and Data Requirements Control List 
(AMSDL).
    (b) Also, furnish data item descriptions which are not listed in the 
AMSDL, except when it is not feasible, e.g., documents are bulky or only 
a limited number of copies are available at the contracting activity.
    (d) The AMSDL, all unclassified specifications and standards listed 
in the DODISS, and data item descriptions listed in the AMSDL may also 
be purchased from the Standardization Documents Desk, Building 4D, 700 
Robbins Avenue, Philadelphia, PA 19111-5094. Include with the letter or 
DD Form 1425--
    (i) The requester's customer number; and
    (ii) Complete return mailing address, including any ``mark for'' 
instructions.



211.204  Solicitation provisions and contract clauses.

    (c) When contract performance requires use of specifications and 
standards which are not listed in the DODISS and data item descriptions 
which are not listed in the AMSDL, use provisions, as appropriate, 
substantially the same as those at 252.211-7001, Availability of 
Specifications and Standards Not Listed in DODISS, Data Item 
Descriptions Not Listed in DoD 5010.12-L, and Plans, Drawings, and Other 
Pertinent Documents, and 252.211-7002, Availability for Examination of 
Specifications, Standards, Plans, Drawings, Data Item Descriptions, and 
Other Pertinent Documents.

[[Page 69]]



211.270  Brand name or equal purchase descriptions.



211.270-1  Policy.

    When a ``brand name or equal'' purchase description is used--
    (a) The purchase description--
    (1) Should include a complete common generic identification of the 
item.
    (2) Should reference all known acceptable brand name products, to 
include--
    (i) Name of manufacturer, producer, or distributor of each brand 
name product referenced (and address if not well known); and
    (ii) Model, make, or catalog number for each, and identity of the 
commercial catalog in which it appears.
    (3) May, if necessary to adequately describe an item, use a 
commercial catalog description or an extract from the catalog. Ensure 
that a copy of each catalog referenced (except parts catalogs) is 
available at the contracting office for review by offerors.
    (4) Should give prospective offerors the opportunity to offer 
products other than those specifically referenced by brand name, as long 
as they meet the needs of the Government in essentially the same manner 
as the brand name product.
    (5) Must identify those salient physical, functional, or other 
characteristics which are essential to the needs of the Government.
    (b) The solicitation--
    (1) Shall be at or below the simplified acquisition threshold in FAR 
part 13.
    (2) May require bid samples for ``or equal'' offers, but not for 
``brand name'' offers.
    (3) Must provide for full consideration and evaluation of ``or 
equal'' offers against the salient characteristic specified in the 
purchase description. Do not reject offers for minor differences in 
design, construction, or features which do not affect the suitability of 
the product for its intended use.
    (4) Must include the following immediately after the item 
description--Offering:

Manufacturer's Name______ Brand______ Model or Part No.______

    (c) The contract shall--
    (1) Not exceed the simplified acquisition threshold in FAR part 13.
    (2) Identify, or incorporate by reference an identification of the 
specific products the contractor is to furnish. Include any brand name, 
make or model number, descriptive material, and any modifications of 
brand name products specified in the offer.



211.270-2  Solicitation provision.

    (a) When a brand name or equal purchase description is included in a 
solicitation at or below the simplified acquisition threshold in FAR 
part 13, use the provision at 252.211-7003, Brand Name or Equal.
    (b) When component parts of an end item are described by brand name 
or equal purchase descriptions and application of the provision at 
252.211-7003 to some or all of the components is impracticable, either 
do not use the provision or limit its application to specified 
components.



211.271  Elimination of use of class I ozone-depleting substances.

    (a) Contracts. No DoD contract may include a specification or 
standard that requires the use of a class I ozone-depleting substance or 
that can be met only through the use of such a substance unless the 
inclusion of the specification or standard is specifically authorized at 
a level no lower than a general or flag officer or member of the Senior 
Executive Service of the requiring activity in accordance with Section 
326, Public Law 102-484 (10 U.S.C. 2301 (repealed) note).
    (b) Modifications. (1) Contracts awarded before June 1, 1993, with a 
value in excess of $10 million, that are modified or extended (including 
option exercise) and, as a result of the modification or extension will 
expire more than one year after the effective date of the modification 
or extension, must be evaluated in accordance with agency procedures for 
the elimination of ozone-depleting substances.
    (i) The evaluation must be carried out within 60 days after the 
first modification or extension.
    (ii) No further modification or extension may be made to the 
contract until the evaluation is complete.

[[Page 70]]

    (2) If, as a result of this evaluation, it is determined that an 
economically feasible substitute substance or alternative technology is 
available, the contracting officer shall modify the contract to require 
the use of the substitute substance or alternative technology.
    (3) If a substitute substance or alternative technology is not 
available, a written determination shall be made to that effect at a 
level no lower than a general or flag officer or member of the Senior 
Executive Service of the requiring activity.



211.272  Alternate preservation, packaging, and packing.

    Use the provision at 252.211-7004, Alternate Preservation, 
Packaging, and Packing, in solicitations which include military 
preservation, packaging, or packing specifications when it is feasible 
to evaluate and award using commercial or industrial preservation, 
packaging, or packing.



 211.273  Substitutions for military or Federal specifications and standards.



211.273-1  Definition.

    SPI process, as used in this section, is defined in the clause at 
252.211-7005, Substitutions for Military or Federal Specifications and 
Standards.
[62 FR 44224, Aug. 20, 1997]



211.273-2  Policy.

    (a) Under the Single Process Initiative (SPI), DoD accepts SPI 
processes in lieu of specific military or Federal specifications or 
standards that specify a management or manufacturing process.
    (b) DoD acceptance of an SPI process follows the decision of a 
Management Council, which includes representatives from the Defense 
Contract Management Command, the Defense Contract Audit Agency, and the 
military departments.
    (c) In procurements of previously developed items, SPI processes 
that previously were accepted by the Management Council shall be 
considered valid replacements for military or Federal specifications or 
standards, absent a specific determination to the contrary (see 211.273-
3(c)).
[62 FR 44224, Aug. 20, 1997]



211.273-3  Procedures.

    (a) Solicitations for previously developed items shall encourage 
offerors to identify SPI processes for use in lieu of military or 
Federal specifications and standards cited in the solicitation. The 
solicitation shall require an offeror proposing to use an SPI process to 
include, in its response to the solicitation, documentation of the 
Government acceptance of the process.
    (b) Contracting officers shall ensure that--
    (1) Concurrence of the requiring activity has been or will be 
obtained for any proposed substitutions prior to contract award; and
    (2) Any necessary additional information regarding the SPI process 
identified in the proposal is obtained from the cognizant administrative 
contracting officer.
    (c) Any determination that an SPI process is not acceptable for a 
specific procurement shall be made at the head of the contracting 
activity or program executive officer level. This authority may not be 
delegated.
[62 FR 44224, Aug. 20, 1997]



211.273-4  Contract clause.

    Use the clause at 252.211-7005, Substitutions for Military or 
Federal Specifications and Standards, in solicitations and contracts 
exceeding the micro-purchase threshold, when procuring previously 
developed items.
[62 FR 44224, Aug. 20, 1997]



                    Subpart 211.5--Liquidated Damages



211.504  Contract clauses.

    (b) Use the clause at FAR 52.211-12, Liquidated Damages--
Construction, in all construction contracts exceeding $500,000, except 
cost-plus-fixed-fee contracts or contracts where the contractor cannot 
control the pace of the work. Use of the clause in contracts of $500,000 
or less is optional.

[[Page 71]]



                Subpart 211.6--Priorities and Allocations



211.602  General.

    DoD implementation of the Defense Priorities and Allocations System 
is in DoDI 4400.1, Priorities and Allocations--Delegation of DO and DX 
Priorities and Allocations Authorities, Rescheduling of Deliveries and 
Continuance of Related Manuals.



PART 212--ACQUISITION OF COMMERCIAL ITEMS--Table of Contents




 Subpart 212.2--Special Requirements for the Acquisition of Commercial 
                                  Items

Sec.
212.211  Technical data.

  Subpart 212.3--Solicitation Provisions and Contract Clauses for the 
                     Acquisition of Commercial Items

212.301  Solicitation provisions and contract clauses for the 
          acquisition of commercial items.
212.302  Tailoring of provisions and clauses for the acquisition of 
          commercial items.

   Subpart 212.5--Applicability of Certain Laws to the Acquisition of 
                            Commercial Items

212.503  Applicability of certain laws to Executive Agency contracts for 
          the acquisition of commercial items.
212.504  Applicability of certain laws to subcontracts for the 
          acquisition of commercial items.

    Authority:  41 U.S.C. 421 and 48 CFR Chapter 1.

    Source:  60 FR 61595, Nov. 30, 1995, unless otherwise noted.



 Subpart 212.2--Special Requirements for the Acquisition of Commercial 
                                  Items



212.211  Technical data.

    The DoD policy for acquiring technical data for commercial items is 
at 227.7102.



  Subpart 212.3--Solicitation Provisions and Contract Clauses for the 
                     Acquisition of Commercial Items



212.301  Solicitation provisions and contract clauses for the acquisition of commercial items.

    (f)(i) Use one of the following provisions as prescribed in part 
225:
    (A) 252.225-7000, Buy American Act--Balance of Payments Program 
Certificate.
    (B) 252.225-7006, Buy American Act--Trade Agreements--Balance of 
Payments Program Certificate.
    (C) 252.225-7035, Buy American Act--North American Free Trade 
Agreement Implementation Act--Balance of Payments Program Certificate.
    (ii) Use the provision at 252.212-7000, Offeror Representations and 
Certifications--Commercial Items, in all solicitations for commercial 
items exceeding the simplified acquisition threshold. If an exception to 
10 U.S.C. 2410i applies to a solicitation exceeding the simplified 
acquisition threshold (see 225.770-3), indicate on an addendum that 
``The certification in paragraph (b) of the provision at 252.225-7000 
does not apply to this solicitation.''
    (iii) Use the clause at 252.212-7001, Contract Terms and Conditions 
Required to Implement Statutes or Executive Orders Applicable to Defense 
Acquisitions of Commercial Items, in all solicitations and contracts for 
commercial items, completing paragraph (b), as appropriate.
[60 FR 61595, Nov. 30, 1995, as amended at 61 FR 50452, Sept. 26, 1996; 
62 FR 34122, June 24, 1997]



212.302  Tailoring of provisions and clauses for the acquisition of commercial items.

    (c) Tailoring inconsistent with customary commercial practice.
    The head of the contracting activity is the approval authority 
within the DoD for waivers under FAR 12.302(c).

[[Page 72]]



   Subpart 212.5--Applicability of Certain Laws to the Acquisition of 
                            Commercial Items



212.503  Applicability of certain laws to Executive Agency contracts for the acquisition of commercial items.

    (a) The following laws are not applicable to contracts for the 
acquisition of commercial items:
    (i) Section 806, Public Law 102-190 (10 U.S.C. 2301 (repealed) 
note), Payment Protections for Subcontractors and Suppliers.
    (ii) 10 U.S.C. 2306(b), Prohibition on Contingent Fees.
    (iii) 10 U.S.C. 2324, Allowable Costs Under Defense Contracts.
    (iv) 10 U.S.C. 2384(b), Requirement to Identify Suppliers.
    (v) 10 U.S.C. 2397(a)(1), Reports by Employees or Former Employees 
of Defense Contractors.
    (vi) 10 U.S.C. 2397b(f), Limits on Employment for Former DoD 
Officials.
    (vii) 10 U.S.C. 2397c, Defense Contractor Requirements Concerning 
Former DoD Officials.
    (viii) 10 U.S.C. 2408(a), Prohibition on Persons Convicted of 
Defense Related Felonies.
    (ix) 10 U.S.C. 2410b, Contractor Inventory Accounting System 
Standards (see 252.242-7004).
    (x) 107 Stat 1720 (Section 843(a), Public Law 103-160), Reporting 
Requirement Regarding Dealings with Terrorist Countries.
    (xi) Domestic Content Restrictions in the National Defense 
Appropriations Acts for Fiscal Years 1996 and Subsequent Years.
    (c) The applicability of the following laws has been modified in 
regard to contracts for the acquisition of commercial items:
    (i) 10 U.S.C. 2402, Prohibition on Limiting Subcontractor Direct 
Sales to the United States (see FAR 3.503 and 52.203-6).
    (ii) 10 U.S.C. 2306a, Truth in Negotiations Act (see FAR 15.804).



212.504  Applicability of certain laws to subcontracts for the acquisition of commercial items.

    (a) The following laws are not applicable to subcontracts at any 
tier for the acquisition of commercial items or commercial components:
    (i) [Reserved]
    (ii) Section 806, Public Law 102-190 (10 U.S.C. 2301 (repealed) 
note), Payment Protections for Subcontractors and Suppliers.
    (iii) 10 U.S.C. 2306(b) Prohibition on Contingent Fees.
    (iv) 10 U.S.C. 2313(c), Examination of Records of a Contractor.
    (v) 10 U.S.C. 2320, Rights in Technical Data.
    (vi) 10 U.S.C. 2321, Validation of Proprietary Data Restrictions.
    (vii) 10 U.S.C. 2324, Allowable Costs Under Defense Contracts.
    (viii) 10 U.S.C. 2327, Reporting Requirement Regarding Dealings with 
Terrorist Countries.
    (ix) 10 U.S.C. 2384(b), Requirement to Identify Suppliers.
    (x) 10 U.S.C. 2391 note, Notification of Substantial Impact on 
Employment.
    (xi) 10 U.S.C. 2393, Prohibition Against Doing Business with Certain 
Offerors or Contractors.
    (xii) 10 U.S.C. 2397(a)(1), Reports by Employees or Former Employees 
of Defense Contractors.
    (xiii) 10 U.S.C. 2397b(f), Limits on Employment for Former DoD 
Officials.
    (xiv) 10 U.S.C. 2397c, Defense Contractor Requirements Concerning 
Former DoD Officials.
    (xv) 10 U.S.C. 2408(a) Prohibition on Persons Convicted of Defense 
Related Felonies.
    (xvi) 10 U.S.C. 2410b, Contractor Inventory Accounting System 
Standards.
    (xvii) 10 U.S.C. 2501 note, Notification of Proposed Program 
Termination.
    (xviii) 10 U.S.C. 2534, Miscellaneous Limitations on the Procurement 
of Goods Other Than United States Goods.
    (xix)-(xxi) [Reserved]
    (xxii) Effective May 1, 1996: 10 U.S.C. 2631, Transportation of 
Supplies by Sea.
    (xxiii) 19 U.S.C. 2512, Trade Agreements Act.
    (xxiv) 41 U.S.C. 10, Buy American Act.
    (xxv) 10 U.S.C. 2327 (Section 843(a), Public Law 103-160), Reporting 
Requirement Regarding Dealings with Terrorist Countries.

[[Page 73]]

    (xxvi) Domestic Content Restrictions in the National Defense 
Appropriations Acts for Fiscal Years 1996 and Subsequent Years.
    (b) Certain requirements of the following laws have been eliminated 
for subcontracts at any tier for the acquisition of commercial items or 
commercial components:
    (i) 10 U.S.C. 2393(d), Subcontractor Reports Under Prohibition 
Against Doing Business with Certain Offerors (see FAR 52.209-6).
    (ii) 10 U.S.C. 2402, Prohibition on Limiting Subcontractor Direct 
Sales to the United States (see FAR 3.503 and 52.203-6).
[60 FR 61595, Nov. 30, 1995, as amended at 61 FR 58488, Nov. 15, 1996; 
62 FR 5780, Feb. 7, 1997]

[[Page 74]]



          SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES





PART 213--SIMPLIFIED ACQUISITION PROCEDURES--Table of Contents




Sec.
213.000  Scope of part.

                         Subpart 213.1--General

213.101  Definitions.

               Subpart 213.2--Blanket Purchase Agreements

213.203  Establishment of Blanket Purchase Agreements.
213.203-1  General.
213.203-2  Clauses.
213.204  Purchase under Blanket Purchase Agreements.

                  Subpart 213.3--Fast Payment Procedure

213.302  Conditions for use.

                       Subpart 213.4--Imprest Fund

213.401  General.
213.402  Agency responsibilities.
213.403  Conditions for use.

                     Subpart 213.5--Purchase Orders

213.503  Obtaining contractor acceptance and modifying purchase orders.
213.504  Termination or cancellation of purchase orders.
213.505  Purchase order and related forms.
213.505-1  Optional Form (OF) 347, Order for Supplies or Services, and 
          Optional Form 348, Order for Supplies or Services Schedule-
          Continuation.
213.505-3  Standard Form 44, Purchase Order-Invoice-Voucher.
213.507  Provisions and clauses.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36324, July 31, 1991, unless otherwise noted.



213.000  Scope of part.

    This part also implements 10 U.S.C. 2302(7) which increases the 
simplified acquisition threshold to $200,000 for any contract to be 
awarded and performed outside the United States in support of a 
contingency operation as defined in 10 U.S.C. 101(a)(13).
[59 FR 50851, Oct. 6, 1994, as amended at 61 FR 7742, Feb. 29. 1996]



                         Subpart 213.1--General



213.101  Definitions.

    Contingency operation is defined in 10 U.S.C. 101(a)(13) as a 
military operation that--
    (1) Is designated by the Secretary of Defense as an operation in 
which members of the armed forces are or may become involved in military 
actions, operations, or hostilities against an enemy of the United 
States or against an opposing military force; or
    (2) Results in the call or order to, or retention on, active duty of 
members of the uniformed services under section 688, 12301(a), 12302, 
12304, 12305, or 12406 of Title 10, chapter 15 of Title 10, or any other 
provision of law during a war or during a national emergency declared by 
the President or Congress.
[59 FR 50851, Oct. 6, 1994, as amended at 61 FR 7742, Feb. 29, 1996]



               Subpart 213.2--Blanket Purchase Agreements



213.203  Establishment of Blanket Purchase Agreements.



213.203-1  General.

    (i) Prepare and issue blanket purchase agreements (BPAs) on DD Form 
1155, Order for Supplies or Services.



213.203-2  Clauses.

    (a) The clauses prescribed at 213.507 for purchase orders also apply 
to BPAs.



213.204  Purchase under Blanket Purchase Agreements.

    (b) Individual purchases for subsistence may be made at any dollar 
value; however, the contracting officer shall satisfy the competition 
requirements

[[Page 75]]

of FAR part 6 for any action not using simplified acquisition 
procedures.
[56 FR 36324, July 31, 1991, as amended at 61 FR 7742, Feb. 29, 1996]



                  Subpart 213.3--Fast Payment Procedure



Sec. 213.302  Conditions for use.

    (a) Individual orders may exceed $25,000 for--
    (i) Brand name commissary resale subsistence; and
    (ii) Medical supplies for direct shipment overseas.



                       Subpart 213.4--Imprest Fund



213.401  General.

    See DoDD 7360.10, Disbursing Policies, and chapter 32 of the DoD 
Accounting Manual, DoD 7220.9-M.
[56 FR 36324, July 31, 1991. Redesignated at 61 FR 7742, Feb. 29, 1996]



213.402  Agency responsibilities.

    (c) Installation commanders and commanders of other activities with 
contracting authority are responsible for approving the establishment of 
imprest funds.
[56 FR 36324, July 31, 1991. Redesignated at 61 FR 7742, Feb. 29, 1996]



213.403  Conditions for use.

    (a) Overseas transactions in support of a contingency operation as 
defined in 10 U.S.C. 101(a)(13) may use imprest funds up to $2,500.
    (c)(i) Additional conditions for use include--
    (A) Availability for delivery within 60 days; and
    (B) No requirement for detailed technical specifications or 
technical inspections.
    (ii) When imprest funds are used for simplified acquisitions, the 
funds may also be used to pay charges for local delivery, parcel post, 
c.o.d. charges, and line haul or inter-city transportation charges when 
the supplier is to arrange for delivery.
[56 FR 36324, July 31, 1991, as amended at 59 FR 50851, Oct. 6, 1994. 
Redesignated and amended at 61 FR 7742, Feb. 29, 1996]



                     Subpart 213.5--Purchase Orders



213.503  Obtaining contractor acceptance and modifying purchase orders.

    (a) Require written acceptance of purchase orders for classified 
acquisitions.
    (b) Use Standard Form 30, Amendment of Solicitation/Modification of 
Contract, to modify purchase orders.
    (d)(i) Unilateral modifications (see FAR 43.103) may also be used 
for--
    (A) No cost amended shipping instructions (ASI) if--
    (1) The ASI modifies a unilateral purchase order, and
    (2) The contractor agrees verbally or in writing.
    (B) Any change made before work begins if--
    (1) The change is within the scope of the original order;
    (2) The contractor agrees;
    (3) The modification references the contractor's verbal or written 
agreement; and
    (4) Block 13D of the Standard Form 30 is annotated to reflect the 
authority for issuance of the modification.
    (ii) A supplemental agreement converts a unilateral purchase order 
to a bilateral agreement. If not previously included in the purchase 
order, incorporate the clauses prescribed in 213.507(a)(ii) in the 
Standard Form 30, Amendment of Solicitation/Modification of Contract, 
and obtain the contractor's acceptance by signature on the Standard Form 
30.



213.504  Termination or cancellation of purchase orders.

    (b) Use Standard Form 30 to cancel a unilateral purchase order.



213.505  Purchase order and related forms.



213.505-1  Optional Form (OF) 347, Order for Supplies or Services, and Optional Form 348, Order for Supplies or Services Schedule-Continuation.

    Departments and agencies shall not use Optional Forms 347, Order for 
Supplies or Services, and 348, Order for Supplies or Services Schedule-
Continuation.

[[Page 76]]

    (b)(i) Use DD Form 1155, Orders for Supplies or Services, (see 
253.213(e)), for purchases made using the simplified acquisition 
procedures of FAR part 13. The DD Form 1155 serves as--
    (A) A purchase order or a blanket purchase agreement, when used with 
the clauses prescribed at 213.507(a);
    (B) A delivery order under a Government contract or from Government 
agencies outside the DoD;
    (C) A receiving and inspection report;
    (D) A property voucher;
    (E) A document for acceptance by the supplier; and
    (F) A public voucher, when used as--
    (1) A delivery order;
    (2) The basis for payment of an invoice against blanket purchase 
agreements or basic ordering agreements when a firm price has been 
established; or
    (3) A purchase order for acquisitions using simplified acquisition 
procedures.
    (ii) The DD Form 1155 is also authorized for use for--
    (A) Classified acquisitions when the purchase is made within the 
United States, its possessions, and Puerto Rico. Attach the DD Form 254, 
Contract Security Classification Specification, to the purchase order.
    (B) Orders under departmental contracts or from Government agencies 
outside the DoD (see FAR subparts 8.4, 8.6, 8.7, and 16.5).
[56 FR 36324, July 31, 1991. Redesignated and amended at 61 FR 7742, 
Feb. 29, 1996; 61 FR 9532, Mar. 8, 1996]



213.505-3  Standard Form 44, Purchase Order-Invoice-Voucher.

    (b)(1) The micro-purchase limitation applies to all purchases except 
that purchases up to the simplified acquisition threshold may be made 
for--
    (A) Aviation fuel and oil;
    (B) Overseas transactions by contracting officers in support of a 
contingency operation as defined in 10 U.S.C. 101(a)(13); and
    (C) Transactions in support of intelligence and other specialized 
activities addressed by Part 2.7 of Executive Order 12333.
[59 FR 50851, Oct. 6, 1994, as amended at 61 FR 7742, Feb. 29, 1996; 61 
FR 18195, Apr. 24, 1996 ]



213.507  Provisions and clauses.

    (a) Use the clauses in paragraphs (a) (i) through (iii) of this 
section, as applicable, in all purchase orders and blanket purchase 
agreements. The clauses listed in the following paragraphs (i) and (ii) 
may be incorporated by reference, except for FAR 52.252-2, Clauses 
Incorporated by Reference. Any other clauses included in the purchase 
order shall be incorporated by reference or in full text as required by 
the matrix in FAR 52.3.
    (i) Unilateral purchase orders--
    (A) FAR 52.252-2, Clauses Incorporated by Reference (required only 
if other clauses are incorporated by reference);
    (B) FAR 52.203-3, Gratuities;
    (C) FAR 52.211-16, Variation in Quantity;
    (D) FAR 52.222-3, Convict Labor (unless the order will be subject to 
the Walsh-Healey Public Contracts Act (see FAR subpart 22.6));
    (E) FAR 52.222-26, Equal Opportunity (unless exempt under FAR 
22.807);
    (F) FAR 52.225-3, Buy American Act-Supplies;
    (G) FAR 52.232,-1, Payments;
    (H) FAR 52.232-25, Prompt Payment;
    (I) FAR 52.232-28, Electronic Funds Transfer Payment Methods;
    (J) FAR 52.233-1, Disputes;
    (K) FAR 52.246-1, Contractor Inspection Requirements (except when an 
alternate level of quality assurance is necessary (see FAR 46.203 and 
46.204)); and
    (L) FAR 52.246-16, Responsibility for Supplies.
    (ii) Bilateral purchase orders--
    (A) The clauses in paragraph (a)(i) of this section;
    (B) FAR 52.204-2, Security Requirements (if the acquisition is 
classified);
    (C) FAR 52.243-1, Changes--Fixed Price (with appropriate alternate 
as necessary);
    (D) 252.243-7001, Pricing of Contract Modifications;
    (E) FAR 52.249-1, 52.249-4, or 52.249-5, Termination for Convenience 
of the Government; and
    (F) FAR 52.249-8, 52.249-9, or 52.249-10, Default.

[[Page 77]]

    (iii) Any other clauses required by the prescription for their use.
[56 FR 36324, July 31, 1991, as amended at 61 FR 7742, Feb. 29, 1996]



PART 214--SEALED BIDDING--Table of Contents




Sec.

                   Subpart 214.2--Solicitation of Bids

214.202  General rules for solicitation of bids.
214.202-5  Descriptive literature.

          Subpart 214.4--Opening of Bids and Award of Contract

214.404  Rejection of bids.,



214-404-1  Cancellation of invitations after opening.



214.407  Mistakes in bids.



214.407-3  Other mistakes disclosed before award.

                 Subpart 214.5--Two-Step Sealed Bidding

214.503  Procedures.
214.503-1  Step one.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36326, July 31, 1991, unless otherwise noted.



                   Subpart 214.2--Solicitation of Bids



214.202  General rules for solicitation of bids.



214.202-5  Descriptive literature.

    (d) Requirements of invitation for bids. When brand name or equal 
purchase descriptions are used, use of the provision at 252.210-7000, 
Brand Name or Equal, satisfies this requirement.



          Subpart 214.4--Opening of Bids and Award of Contract



214.404  Rejection of bids.



214.404-1  Cancellation of invitations after opening.

    The contracting officer shall make the written determinations 
required by FAR 14.404-1 (c) and (e).



214.407  Mistakes in bids.



214.407-3  Other mistakes disclosed before award.

    (e) Authority for making a determination under FAR 14.407-3(a), (b) 
and (d) is delegated for the defense agencies, without power of 
redelegation, as follows:
    (i) Defense Advanced Research Projects Agency: General Counsel, 
DARPA.
    (ii) Defense Information Systems Agency: General Counsel, DISA.
    (iii) Defense Intelligence Agency: Principal Assistant for 
Acquisition.
    (iv) Defense Logistics Agency:
    (A) General Counsel, DLA; and
    (B) Associate General Counsel, DLA.
    (v) National Imagery and Mapping Agency: General Counsel, NIMA.
    (vi) Defense Special Weapons Agency: General Counsel, DSWA.
    (vii) National Security Agency: Director of Procurement, NSA.
    (viii) On-Site Inspection Agency: General Counsel, OSIA.
    (ix) Ballistic Missile Defense Organization: General Counsel, BMDO.
    (h) Send a signed copy of the document authorizing correction of the 
bid to the appropriate finance center with its copy of the contract.
[57 FR 42629, Sept. 15, 1992, as amended at 59 FR 27669, May 27, 1994; 
61 FR 50452, Sept. 26, 1996. Redesignated and amended at 62 FR 34122, 
June 24, 1997]



                 Subpart 214.5--Two-Step Sealed Bidding



214.503  Procedures.



214.503-1  Step one.

    (a) Requests for technical proposals may be in the form of a letter.
[56 FR 36326, July 31, 1991, as amended at 57 FR 53599, Nov. 12, 1992]



PART 215--CONTRACTING BY NEGOTIATION--Table of Contents




Sec.

   Subpart 215.4--Solicitation and Receipt of Proposals and Quotations

215.401  Applicability.
215.406-2  Part I--The Schedule.

[[Page 78]]

215.414  Forms.

                     Subpart 215.6--Source Selection

215.605  Evaluation factors and subfactors.
215.607  Disclosure of mistakes before award.
215.608  Proposal evaluation.
215.611  Best and final offers.
215.613  Alternate source selection procedures.
215.613-70  Four-step source selection procedures.

                   Subpart 215.7--Make-or-Buy Programs

215.704  Items and work included.

                    Subpart 215.8--Price Negotiation

215.804  Cost or pricing data and information other than cost or pricing 
          data.
215.804-1  Prohibition on obtaining cost or pricing data.
215.804-6  Procedural requirements.
215.804-7  Defective cost or pricing data.
215.804-8  Contract clauses.
215.805  Proposal analysis.
215.805-5  Field pricing support.
215.805-70  Cost realism analysis.
215.806  Subcontract pricing considerations.
215.806-1  General.
215.806-3  Field pricing reports.
215.807  Prenegotiation objectives.
215.808  Price negotiation memorandum.
215.809  Forward pricing rate agreements.
215.810  Should-cost review.
215.810-2  Program should-cost review.
215.810-3  Overhead should-cost review.
215.811  Estimating systems.
215.811-70  Disclosure, maintenance, and review requirements.
215.870-215.872  [Reserved]
215.873  Estimated data prices.

                          Subpart 215.9--Profit

215.902  Policy.
215.903  Contracting officer responsibilities.
215.905  Profit-analysis factors.
215.905-1  Common factors.
215.970  DD Form 1547, Record of Weighted Guidelines Method Application.
215.971  Weighted guidelines method.
215.971-1  General.
215.971-2  Performance risk.
215.971-3  Contract type risk and working capital adjustment.
215.971-4  Facilities capital employed.
215.972  Modified weighted guidelines method for nonprofit 
          organizations.
215.973  Alternate structured approaches.
215.974  Fee requirements for cost-plus-award-fee contracts.
215.975  Reporting profit and fee statistics.

Subpart 215.10--Preaward, Award, and Postaward Notifications, Protests, 
                              and Mistakes

215.1001  Notifications to unsuccessful offerors.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36326, July 31, 1991, unless otherwise noted.



   Subpart 215.4--Solicitation and Receipt of Proposals and Quotations



215.401  Applicability.

    See 225.872 for additional guidance on procedures for purchasing 
from qualifying countries.



215.406-2  Part I--The Schedule.

    (g) When a contract contains both fixed-priced and cost-
reimbursement line items or subline items, the contracting officer shall 
provide, in Section B, Supplies or Services and Prices/Costs, an 
identification of contract type specified for each contract line item or 
subline item to facilitate appropriate payment.
[60 FR 34470, July 3, 1995; 60 FR 43191, Aug. 18, 1995]



215.414  Forms.

    This does not preclude use of letter RFPs and RFQs, provided their 
use complies with other requirements of the FAR and this regulation.



                     Subpart 215.6--Source Selection



215.605  Evaluation factors and subfactors.

    (b)(2)(A) In acquisitions which require use of the clause at FAR 
52.219-9, Small, Small Disadvantaged and Women-Owned Small Business 
Subcontracting Plan, the extent of participation of small and small 
disadvantaged business in performance of the contact shall be addressed 
in source selection.
    (1) For acquisitions other than those based only on cost or price 
competition, the contracting officer shall evaluate the extent to which 
offerors identify and commit to small business and to small 
disadvantaged business,

[[Page 79]]

historically black college and university, or minority institution 
performance of the contract, whether as a joint venture, teaming 
arrangement, or subcontractor.
    (2) Criteria for evaluation may include--
    (i) The extent which such firms are specifically identified in 
proposals;
    (ii) The extent of commitment to use such firms (for example, 
enforceable commitments are to be weighted more heavily than non-
enforceable ones);
    (iii) The complexity and variety of the work small firms are to 
perform;
    (iv) The realism of the proposal;
    (v) When not otherwise required by 215.608(a)(2), past performance 
of the offerors in complying with requirements of the clauses at FAR 
52.219-8, Utilization of Small, Small Disadvantaged and Women-Owned 
Small Business Concerns, and 52.219-9, Small, Small Disadvantaged and 
Women-Owned Small Business Subcontracting Plan; and
    (vi) The extent of participation of such firms in terms of the value 
of the total acquisition.
    (3) Proposals addressing the extent of small and small disadvantaged 
business performance may be separate from subcontracting plans submitted 
pursuant to the clause at FAR 52.219-9 and should be structured to allow 
for consideration of offers from small businesses.
    (4) When an evaluation includes the criterion in paragraph 
(b)(2)(A)(2)(i) of this section, the small, small disadvantaged, or 
women-owned small businesses considered in the evaluation shall be 
listed in any subcontracting plan submitted pursuant to FAR 52.219-9 to 
facilitate compliance with 252.219-7003(g).
    (B) The costs or savings related to contract administration and 
audit may be considered when the offeror's past performance or 
performance risk is likely to result in significant costs or savings.
    (c) In competitive acquisitions of services--
    (i) Evaluation and award should be based, to the maximum extent 
practicable, on best overall value to the Government in terms of quality 
and other factors.
    (ii) The weighting of costs must be commensurate with the nature of 
the services being acquired.
    (A) It may be appropriate to award to an offeror, based on technical 
and quality considerations, at other than the lowest price when--
    (1) The effort being contracted for departs from clearly defined 
efforts; or
    (2) Highly skilled personnel are required.
    (B) It may be appropriate to award to the technically acceptable 
offeror with the lowest price when--
    (1) Services being acquired are of a routine or simple nature;
    (2) Highly skilled personnel are not required; or
    (3) The product to be delivered is clearly defined at the outset of 
the acquisition.
[56 FR 36326, July 31, 1991, as amended at 56 FR 67213, Dec. 30, 1991; 
57 FR 14992, Apr. 23, 1992; 59 FR 27669, May 27, 1994; 61 FR 18687, Apr. 
29, 1996; 61 FR 50452, Sept. 26, 1996]



215.607  Disclosure of mistakes before award.

    (c)(3) The designee is the head of the contracting activity, who may 
redelegate this authority to the chief of the contracting office.



215.608  Proposal evaluation.

    (a)(1) Contracting officers shall ensure that the use of 
uncompensated overtime in contracts to acquire services on the basis of 
the number of hours provided (see 237.170) will not degrade the level of 
technical expertise required to fulfill the Government's requirements. 
When acquiring such services, contracting officers shall conduct a risk 
assessment, and evaluate for award on that basis, any proposals received 
that reflect factors such as--
    (i) Unrealistically low labor rates or other costs that may result 
in quality or service shortfalls; and
    (ii) Unbalanced distribution of uncompensated overtime among skill 
levels and its use in key technical positions.
    (2) When a past performance evaluation is required by FAR 15.605, 
and the solicitation includes the clause at FAR 52.219-8, Utilization of 
Small, Small Disadvantaged and Women-Owned

[[Page 80]]

Small Business Concerns, the evaluation shall include the past 
performance of offerors in complying with requirements of that clause. 
When a past performance evaluation is required by FAR 15.605, and the 
solicitation includes the clause at FAR 52.219-9, Small, Small 
Disadvantaged and Women-Owned Small Business Subcontracting Plan, the 
evaluation shall include the past performance of offerors in complying 
with requirements of that clause.
    (b) Except for determinations based on violations or possible 
violations of section 27 of the Office of Federal Procurement Policy 
(OFPP) Act, and unless otherwise specified in department/agency 
regulations, the contracting officer shall make the written 
determination. Determinations based on violations or possible violations 
of Section 27 of the OFPP Act shall be made as specified in FAR 3.104.
[56 FR 36326, July 31, 1991, as amended at 56 FR 67213, Dec. 30, 1991; 
61 FR 18687, Apr. 29, 1996; 62 FR 2612, Jan. 17, 1997]



215.611  Best and final offers.

    (c)(i) Before requesting an additional (second or subsequent) best 
and final offer, the contracting officer shall obtain approval from--
    (A) The source selection authority and the senior procurement 
executive (SPE) for competitive negotiated acquisitions under formal 
source selection (see FAR 15.612). The SPE may delegate this authority 
to a level no lower than the head of the contracting activity.
    (B) The head of the contracting activity (HCA) for all other 
competitive negotiated acquisitions. The HCA may delegate this authority 
to the chief of the contracting office.
    (ii) Each HCA shall establish a system for reporting and documenting 
additional requests for best and final offers. Systems shall include as 
a minimum--
    (A) The total number of competitive negotiated acquisitions awarded;
    (B) The number of those acquisitions for which an additional request 
for best and final offers was approved and issued; and
    (C) The reasons for approving each additional request for best and 
final offers.
    (iii) To ensure that additional requests for best and final offers 
are used only when necessary and unavoidable, HCAs shall--
    (A) Periodically analyze data collected under paragraph (c)(ii) of 
this section;
    (B) Take appropriate corrective action, e.g., training, revising 
approval levels; and
    (C) Provide periodic summary reports to the SPE as specified in 
department/agency regulations.



215.613  Alternate source selection procedures.



215.613-70  Four-step source selection procedures.

    (a) General. The four-step source selection procedure is designed 
for those situations where the Government wishes to focus on technical 
excellence. Proposals are evaluated, a competitive range established, 
and an apparent successful offeror selected without discussions of 
proposal deficiencies (a deficiency is defined as that part of an 
offeror's proposal which would not satisfy the Government's 
requirements). Negotiations are conducted only in the final step and 
only with the apparent successful offeror.
    (b) Applicability. Four-step source selection procedures may be used 
for--
    (1) Competitively negotiated research and development acquisitions 
with an estimated value of $2 million or more; or
    (2) Other acquisitions as permitted by department/agency 
regulations, except those in paragraph (c) of this subsection.
    (c) Restrictions. Four-step source selection procedures shall not be 
used for acquisitions which--
    (1) Will require extensive discussion and negotiations;
    (2) Use the authority of FAR 6.302-2;
    (3) Are solely for personal or nonpersonal services;
    (4) Are for architect-engineer services; or
    (5) Have an estimated value of less than $2 million.
    (d) Presolicitation. Establish early and open dialogue with 
prospective offerors

[[Page 81]]

to ensure their understanding of the Government's needs, since the 
evaluation will be conducted with limited discussions and without 
disclosing deficiencies in offeror proposals. Ways of establishing this 
dialogue are--
    (1) Presolicitation notices;
    (2) Presolicitation conferences;
    (3) Preproposal conferences;
    (4) Solicitations for information or planning purposes; and
    (5) Tailoring of specifications.
    (e) Solicitations. Include the following special provisions in four-
step source selection solicitations--
    (1) Explanation of the four-step concept and procedures;
    (2) Statement regarding the relative importance of technical/system 
performance criteria;
    (3) Notification that the contracting officer may reject proposals 
with unrealistic technical, schedule, cost, or price commitments since 
unrealistic commitments reflect an inherent lack of technical competence 
or indicate a failure to comprehend the complexity and risks of the 
requirements;
    (4) Schedule of planned source selection events, including specific 
dates for the sequential submission of separate technical and cost 
proposal.
    (5) Requirement for the technical proposal to include--
    (i) Identification, when appropriate, of trade-offs (with 
illustrative cost estimate impacts) among performance, production costs, 
operating and support costs, schedule and logistics support factors; and
    (ii) Information showing that the goals for design to cost and 
operating and support costs (when used) will be achieved when the item 
enters production.
    (6) Requirement for the cost proposal to include detailed cost 
information supporting the technical proposal and the cost factors in 
the evaluation criteria;
    (7) Statement that both technical and cost discussions will be 
limited as described in paragraphs (f) and (g) of this subsection; and
    (8) Notification that the contracting officer will only negotiate 
with the selected offeror, and that offerors' initial technical and cost 
proposals should be their best offer.
    (f) Step one--evaluation of technical proposals. (1) The sequence of 
step one--
    (i) Evaluate all technical proposals;
    (ii) Conduct limited discussions with all offerors; and
    (iii) Ask for any necessary clarifications and additional supporting 
data when necessary (normally, ask that this be submitted with the cost 
proposal).
    (2) In conducting step one--
    (i) Limit discussions to only what is necessary to ensure that both 
parties understand each other;
    (ii) Do not tell offerors about deficiencies in their proposals; and
    (iii) Provide written clarification to all offerors when it appears 
the Government's requirements have been misinterpreted.
    (g) Step two--evaluation of cost proposals. (1) The sequence of step 
two--
    (i) Request cost proposals;
    (ii) Evaluate all cost proposals;
    (iii) Establish the competitive range;
    (iv) Eliminate those proposals outside the range and advise those 
offerors;
    (v) Conduct limited discussions with remaining offerors; and
    (vi) Eliminate proposals which cannot be made acceptable and advise 
the offerors.
    (2) In conducting step two--
    (i) Limit discussions to--
    (A) Clarifying inconsistencies or correcting mathematical errors;
    (B) Correlating cost elements with technical effort in order to 
assess cost realism; and
    (C) Ensuring a complete understanding of the Government's 
requirements, the offeror's offer, and other contract terms;
    (ii) Do not tell an offeror that any of its cost elements are either 
too high or too low; and
    (iii) Follow the guidelines in paragraph (f) of this subsection if 
further discussions of technical proposals or clarifications are 
required.
    (h) Step three--common cut-off and selection of an offeror for final 
contract negotiations. (1) The sequence of step three--
    (i) Notify offerors of the common cut-off date for receipt of best 
and final offers (technical and cost);
    (ii) Evaluate the offers;

[[Page 82]]

    (iii) Select the best offeror (see paragraph (h)(2)(iv) of this 
subsection for multiple sources);
    (iv) Tell the selected source that the decision is conditional based 
on negotiation of a definitive contract within the time period 
prescribed by the source selection authority; and
    (v) Advise the other offerors of the source selected.
    (2) In conducting step three--
    (i) Remind offerors, when notifying them of the common cut-off date, 
that any changes incorporated in the final proposal must be fully 
documented;
    (ii) Do not accept lump sum reductions in final cost proposals 
without supporting data;
    (iii) Do not request additional best and final offers without the 
approval required by 215.611(c); and
    (iv) Do not select two or more offerors, rather than a single 
source, for final contract negotiations, unless the HCA makes a written 
determination that final selection of a single source should not be made 
until the prospective contracts have been tentatively negotiated.
    (i) Step four--final negotiations and contract award. (1) The 
sequence of step four (single selectee)--
    (i) Negotiate the final contract price, terms, and conditions; and
    (ii) Award the contract.
    (2) The sequence of step four (multiple selectees)--
    (i) Negotiate tentative final contract terms and conditions;
    (ii) Select the best source; and
    (iii) Award.
    (3) In conducting step four--
    (i) Complete negotiations and award the contract within the time 
prescribed by the source selection authority;
    (ii) Terminate negotiations and make a new source selection decision 
if the condition in paragraph (i)(3)(i) cannot be met;
    (iii) Do not permit changes in the Government's requirements or the 
offeror's proposal which would affect the source selection decision; and
    (iv) Follow the procedures in FAR 15.606 if changes in the 
Government's requirements are necessary.



                   Subpart 215.7--Make-or-Buy Programs



215.704  Items and work included.

    The minimum dollar amount is $1 million.



                    Subpart 215.8--Price Negotiation



215.804  Cost or pricing data and information other than cost or pricing data.



215.804-1  Prohibition on obtaining cost or pricing data.

    (b) Standards for exceptions from cost or pricing data 
requirements--(1) Adequate price competition. (A) An example of a price 
``based on'' adequate price competition is exercise of a priced option 
in a contract where adequate price competition existed, if the 
contracting officer has determined that the option price is reasonable 
in accordance with FAR 17.207(d);
    (B) Dual or multiple source programs.
    (1) In dual or multiple source programs, the determination of 
adequate price competition must be made on a case-by-case basis. 
Contracting officers must exercise deliberation and thorough review in 
making the determination. Even when adequate price competition exists, 
in certain cases it may be appropriate to obtain additional information 
to assist in price analysis.
    (2) Adequate price competition normally exists when--
    (i) Prices are solicited across a full range of step quantities, 
normally including a 0-100 percent split, from at least two offerors 
that are individually capable of producing the full quantity; and
    (ii) The reasonableness of all prices awarded is clearly established 
on the basis of price analysis (see FAR 15.805-2).
    (4) Exceptional cases.
    (A) The DoD has exempted the Canadian Commercial Corporation and its 
subcontractors from submission and certification of cost or pricing data 
on all acquisitions.

[[Page 83]]

    (B) The DoD has waived certain cost or pricing data requirements for 
nonprofit organizations (including educational institutions) on cost-
reimbursement-no-fee contracts. The contracting officer shall require--
    (1) Submission of information other than cost or pricing data to the 
extent necessary to determine price reasonableness and cost realism; and
    (2) Cost or pricing data from subcontractors that are not nonprofit 
organizations.
[62 FR 40472, July 29, 1997]



215.804-6  Procedural requirements.

    (b)(1)(A) When the solicitation requires contractor compliance with 
the Contractor Cost Data Reporting (CCDR) System (Army--AMCP 715-8, 
Navy--NAV PUB P-5241, and Air Force--AFMCP 800-15), require the 
contractor to submit DD Forms 1921 or 1921-1 with its SF 1411.
    (B) Contracting offices may develop contract pricing proposal 
supporting schedules for use by offerors in providing supporting data 
for the SF 1411. Schedules should only ask for data that are necessary 
and reasonable based on industry, company, or commodity practices.
[56 FR 36326, July 31, 1991, as amended at 59 FR 27669, May 27, 1994; 62 
FR 40472, July 29, 1997]



215.804-7  Defective cost or pricing data.

    (b)(2) Unless there is clear evidence to the contrary, the 
contracting officer may presume the defective data were relied on and 
resulted in a contract price increase equal to the amount of the defect 
plus related overhead and profit or fee. The contracting officer is not 
expected to reconstruct the negotiation by speculating as to what would 
have been the mental attitudes of the negotiating parties if the 
nondefective data had been known.



215.804-8  Contract clauses.

    If the solicitation or contract includes one of the clauses at FAR 
52.215-23, FAR 52.215-24, or FAR 52.215-25, also use the clause at 
252.215-7000, Pricing Adjustments.
[60 FR 61596, Nov. 30, 1995]



215.805  Proposal analysis.



215.805-5  Field pricing support.

    (a)(1)(A) Contracting officers shall request field pricing reports 
for--
    (1) Fixed-price proposals exceeding the cost or pricing data 
threshold at FAR 15.804-2(a)(1);
    (2) Cost-type proposals exceeding the cost or pricing data threshold 
at FAR 15.804-2(a) (1) from offerors with significant estimating system 
deficiencies (see 215.811-70(a)(3) and (c)(2)(i); or
    (B) Contracting officers may, with adequate written justification, 
waive the requirement for these reports.
    (2)(A) The contract administration office price/cost analyst 
supports the administrative contracting officer in preparing a complete 
and accurate field pricing report for the contracting officer. The 
analyst--
    (1) In concert with the auditor and in consideration of the 
auditor's workload, establishes a deadline for the auditor's input, 
subject to adjustments when considered necessary;
    (2) Identifies areas for special consideration;
    (3) Arranges for exchanges of technical and audit information; and
    (4) Must be fully responsive to a request for technical information 
from the auditor.
    (B) The pricing report--
    (1) Details the price/cost analyst's comprehensive review and 
evaluation of the proposal;
    (2) Includes information specifically requested by the contracting 
officer; and
    (3) Summarizes what was analyzed, how it was analyzed, and the 
conclusions reached.
    (c)(i) In requesting field pricing support--
    (A) Mark all requests ``FIELD PRICING REQUEST'' in bold letters on 
the mailing envelope;
    (B) On urgent requests, provide facsimile numbers to facilitate 
return of the completed report; and
    (C) Send an advance copy to the audit activity.
    (ii) When the contracting officer knows in advance that field 
pricing support will be required, the contracting officer may request 
field pricing

[[Page 84]]

support before the offeror submits a proposal.
    (A) Give the administrative contracting officer (ACO) and auditor a 
copy of the solicitation;
    (B) Tell them when to expect the proposal; and
    (C) Tell the offeror to provide the ACO and auditor copies of the 
proposal.
    (iii) Where audit reports are received on contracting actions that 
are subsequently cancelled or unsuccessful, notify the cognizant auditor 
in writing.
    (iv) For spare parts or support equipment, identify all line items 
where the proposed price exceeds by 25 percent or more the lowest price 
the Government has paid within the most recent 12-month period. The 
field pricing report will include, as a minimum--
    (A) A detailed analysis of each line item identified by the 
contracting officer in the request;
    (B) A detailed analysis of those line items where a comparison of 
the item description and the proposed price indicates a potential for 
overpricing;
    (C) An analysis of the significant high-dollar-value items. If there 
are no obvious high-dollar-value items, include an analysis of a random 
sample of items; and
    (D) An analysis of a random sample of the remaining low-dollar value 
items. Sample size may be determined by subjective judgment, e.g., 
experience with the contractor and reliability of its estimating and 
accounting systems.
    (v) For spare parts proposals that have been identified as Spares 
Acquisition Integrated with Production (SAIP) items (see DoD Instruction 
4245.12, Spares Acquisition Integrated with Production (SAIP))--
    (A) Include a copy of the data entitled ``Contractor's Procurement 
Schedule for SAIP'' (Data Item DI-V-7200), or equivalent, in the request 
so that the benefits of combining new and in process quantities can be 
assured (these data are delivered by the contractor on contracts that 
include SAIP requirements); or
    (B) Require the contractor to include these data in its proposal.
    (e)(6) The contract administration office price/cost analyst is 
responsible for providing a complete and accurate field pricing report. 
This includes quantifying technical findings; however, if the auditor 
requests a technical analysis, the auditor normally will incorporate the 
financial effect of the analysis in the audit report.
    (7) The contracting officer shall, with the advice of the ACO and 
auditor, ensure that the contractor initiates necessary corrective 
action before contract award.
    (8) The administrative contracting officer and auditor shall confer 
with the contractor during the course of the field pricing review to 
fully understand the basis for each item in the proposal and to remove 
any doubts as to the validity and accuracy of their conclusions and 
findings.
    (g) The audit activity sends the original to the administrative 
contracting officer and a copy to the contracting officer.
[56 FR 36326, July 31, 1991, as amended at 62 FR 40472, July 29, 1997]



215.805-70  Cost realism analysis.

    (a) In competitive acquisitions, even when adequate price 
competition exists, to ensure that proposed costs are consistent with 
the technical proposal, the contracting officer--
    (1) Should perform a cost realism analysis when--
    (i) A cost-reimbursement contract is anticipated;
    (ii) The solicitation contains new requirements that may not be 
fully understood by competing contractors;
    (iii) There are quality concerns; or
    (iv) Past experience indicates that contractors proposed costs have 
resulted in quality or service shortfalls.
    (2) May perform a cost realism analysis on other acquisitions.
    (b) The contracting officer should determine what information other 
than cost or pricing data is necessary for the cost realism analysis 
during acquisition planning and development of the solicitation. Unless 
such information is already available from Government sources, the 
contracting officer will need to ask the offerors for it.
    (1) Request only necessary data; and
    (2) Do not request submission of cost or pricing data.
[56 FR 36326, July 31, 1991, as amended at 62 FR 40472, July 29, 1997]

[[Page 85]]



215.806  Subcontract pricing considerations.



215.806-1  General.

    Price redeterminable or fixed-price incentive contracts may include 
subcontracts placed on the same basis. When the contracting officer 
wants to reprice the prime contract even though the contractor has not 
yet established final prices for the subcontracts, the contracting 
officer may negotiate a firm contract price--
    (1) If cost or pricing data on the subcontracts show the amounts to 
be reasonable and realistic; or
    (2) If cost or pricing data on the subcontracts are too indefinite 
to determine whether the amounts are reasonable and realistic, but--
    (i) Circumstances require prompt negotiation; and
    (ii) A statement substantially as follows is included in the 
repricing modification of the prime contract:

    As soon as the Contractor establishes firm prices for each 
subcontract listed below, the Contractor shall submit (in the format and 
with the level of detail specified by the Contracting Officer) to the 
Contracting Officer the subcontractor's cost incurred in performing the 
subcontract and the final subcontract price. The Contractor and 
Contracting Officer shall negotiate an equitable adjustment in the total 
amount paid or to be paid under this contract to reflect the final 
subcontract price.

    (a)(1) Contractor and subcontractor proposals may reflect the 
selection of sources whose proposals offer the greatest value to the 
Government in terms of performance and other factors. If the selection 
is based on greatest value rather than lowest price, the analysis 
supporting subcontractor selection should include a discussion of the 
factors considered in the selection (see also FAR 15.605(c) and 
215.605(c)). If the contractor's analysis is not adequate, return it for 
correction of deficiencies.
    (d) The contracting officer shall make every effort to ensure that 
fees negotiated by contractors for cost-plus-fixed-fee subcontracts do 
not exceed the fee limitations in FAR 15.903(d).
[56 FR 36326, July 31, 1991, as amended at 60 FR 29497, June 5, 1995]



215.806-3  Field pricing reports.

    (a)(i) If, in the opinion of the contracting officer or auditor, the 
review of a prime contractor's proposal requires further review of 
subcontractors' cost estimates at the subcontractors' plants (after due 
consideration of reviews performed by the prime contractor), these 
reviews should be fully coordinated with the administrative contracting 
officer (ACO) having cognizance of the prime contractor before being 
initiated. The ACO for the prime contractor will initiate the request to 
the ACO for the subcontractor, with an information copy to the auditor 
for the subcontractor. The ACO for the subcontractor sends the resulting 
field pricing report to the prime ACO with an information copy to the 
prime auditor. Requests for field pricing support on lower tier 
subcontractors are handled in a like manner.
    (ii) Notify the appropriate contract administration activities when 
extensive, special, or expedited field pricing assistance will be needed 
to review and evaluate subcontractors' proposals under a major weapon 
system acquisition.



215.807  Prenegotiation objectives.

    (a)(i) Also consider data resulting from application of work 
measurement systems in developing prenegotiation objectives.
    (ii) Consider field pricing support personnel participation in 
planned prenegotiation and negotiation activities.
    (b) Prenegotiation objectives, including objectives related to 
disposition of findings and recommendations contained in preaward and 
postaward contract audit and other advisory reports, shall be documented 
and reviewed in accordance with Departmental procedures.
[56 FR 36326, July 31, 1991, as amended at 59 FR 27669, May 27, 1994]



215.808  Price negotiation memorandum.

    (a)(8) Include the principal factors related to the disposition of 
findings and recommendations contained in preaward and postaward 
contract audit and other advisory reports.

[[Page 86]]

    (10) The memorandum--
    (A) Must document significant deviations from the prenegotiation 
profit objective;
    (B) Should include the DD Form 1547, Record of Weighted Guidelines 
Application (see subpart 215.9), if used, with supporting rationale; and
    (C) Must document the rationale for not using the weighted 
guidelines method when its use is required by 215.9.



215.809  Forward pricing rate agreements.

    (e)(i) Use forward pricing rate agreement (FPRA) rates when such 
rates are available, unless waived on a case-by-case basis by the head 
of the contracting activity.
    (ii) Advise the ACO of each case waived.
    (iii) Contact the ACO for questions on FPRAs or recommended rates.



215.810  Should-cost review.



215.810-2  Program should-cost review.

    (b) DoD contracting activities should consider performing a program 
should-cost review before award of a definitive major systems contract 
exceeding $100 million.
[61 FR 7742, Feb. 29, 1996]



215.810-3  Overhead should-cost review.

    (a) Contact the DCMC/DLA Overhead Center, Fort Belvoir, VA 22060-
6221, at (703) 767-3387, for questions on overhead should-cost analysis.
    (b)(i) The Defense Contract Management Command/Defense Logistics 
Agency (DCMC/DLA), or the military department responsible for performing 
contract administration functions (e.g., Navy SUPSHIP), should consider, 
based on risk assessment, performing an overhead should-cost review of a 
contractor business unit (as defined in FAR 31.001) when all of the 
following conditions exist:
    (A) Projected annual sales to DoD exceed $1 billion;
    (B) Projected DoD versus total business exceeds 30 percent;
    (C) Level of sole-source DoD contracts is high;
    (D) Significant volume of proposal activity is anticipated;
    (E) Production or development of a major weapon system or program is 
anticipated; and
    (F) Contractor cost control/reduction initiatives appear inadequate.
    (ii) The head of the contracting activity may request an overhead 
should-cost review for a business unit which does not meet the criteria 
in paragraph (b)(i) of this subsection.
    (iii) Overhead should-cost reviews are labor intensive. These 
reviews generally involve participation by the contracting, contract 
administration, and contract audit elements. The extent of availability 
of military department, contract administration, and contract audit 
resources to support DCMC/DLA-led teams should be considered when 
determining whether a review will be conducted. Overhead should-cost 
reviews generally shall not be conducted at a contractor business 
segment more frequently than every three years.
[61 FR 7743, Feb. 29, 1996; 61 FR 18195, Apr. 24, 1996]



215.811  Estimating systems.



215.811-70  Disclosure, maintenance, and review requirements.

    (a) Definitions. (1) Adequate estimating system means an estimating 
system that--
    (i) Is established, maintained, reliable, and consistently applied; 
and
    (ii) Produces verifiable, supportable, and documented cost 
estimates.
    (2) Contractor means a business unit as defined in FAR 31.001.
    (3) Estimating system is as defined in the clause at 252.215-7002 
Cost Estimating System Requirements.
    (4) Significant estimating system deficiency means a shortcoming in 
the estimating system which is likely to consistently result in proposal 
estimates for total cost or a major cost element(s) which do not provide 
an acceptable basis for negotiation of fair and reasonable prices.
    (b) Applicability. (1) DoD policy is that all contractors have 
estimating systems that--
    (i) Are adequate;
    (ii) Consistently produce well supported proposals that are 
acceptable as

[[Page 87]]

a basis for negotiation of fair and reasonable prices;
    (iii) Are consistent with and integrated with the contractor's 
related management systems; and
    (iv) Are subject to applicable financial control systems.
    (2) A large business contractor is subject to estimating system 
disclosure, maintenance, and review requirements if--
    (i) In its preceding fiscal year, the contractor received DoD prime 
contracts or subcontracts totaling $50 million or more for which cost or 
pricing data were required; or
    (ii) In its preceding fiscal year, the contractor received DoD prime 
contracts or subcontracts totaling $10 million or more (but less than 
$50 million) for which cost or pricing data were required and the 
contracting officer, with concurrence or at the request of the 
administrative contracting officer, determines it to be in the best 
interest of the Government (e.g., significant estimating problems are 
believed to exist or the contractor's sales are predominantly 
Government).
    (c) Responsibilities. (1) The contracting officer shall--
    (i) Through use of the clause at 252.215-7002 Cost Estimating System 
Requirements, apply the disclosure, maintenance and review requirements 
to large business contractors meeting the criteria in paragraph 
(b)(2)(i) of this subsection;
    (ii) Consider whether to apply the disclosure, maintenance, and 
review requirements to large business contractors under paragraph 
(b)(2)(ii) of this subsection; and
    (iii) Not apply the disclosure, maintenance, and review requirement 
to other than large business contractors.
    (2) The cognizant administrative contracting officer, for 
contractors subject to paragraph (b)(2) of this subsection, shall--
    (i) Determine the adequacy of the disclosure and system; and
    (ii) Pursue correction of any deficiencies.
    (3) The cognizant auditor, on behalf of the ACO, serves as team 
leader in conducting estimating system reviews.
    (4) A contractor subject to estimating system disclosure, 
maintenance, and review requirements shall--
    (i) Maintain an adequate system;
    (ii) Describe its system to the administrative contracting officer 
(ACO);
    (iii) Provide timely notice of changes in the system; and
    (iv) Correct system deficiencies identified by the ACO.
    (d) Characteristics of an adequate estimating system--(1) General. 
An adequate system should provide for the use of appropriate source 
data, utilize sound estimating techniques and good judgment, maintain a 
consistent approach, and adhere to established policies and procedures.
    (2) Evaluation. In evaluating the adequacy of a contractor's 
estimating system, the ACO should consider whether the contractor's 
estimating system, for example--
    (i) Establishes clear responsibility for preparation, review and 
approval of cost estimates;
    (ii) Provides a written description of the organization and duties 
of the personnel responsible for preparing, reviewing, and approving 
cost estimates;
    (iii) Assures that relevant personnel have sufficient training, 
experience and guidance to perform estimating tasks in accordance with 
the contractor's established procedures;
    (iv) Identifies the sources of data and the estimating methods and 
rationale used in developing cost estimates;
    (v) Provides for appropriate supervision throughout the estimating 
process;
    (vi) Provides for consistent application of estimating techniques;
    (vii) Provides for detection and timely correction of errors;
    (viii) Protects against cost duplication and omissions;
    (ix) Provides for the use of historical experience, including 
historical vendor pricing information, where appropriate;
    (x) Requires use of appropriate analytical methods;
    (xi) Integrates information available from other management systems, 
where appropriate;
    (xii) Requires management review including verification that the 
company's estimating policies, procedures

[[Page 88]]

and practices comply with this regulation;
    (xiii) Provides for internal review of and accountability for the 
adequacy of the estimating system, including the comparison of projected 
results to actual results and an analysis of any differences;
    (xiv) Provides procedures to update cost estimates in a timely 
manner throughout the negotiation process; and
    (xv) Addresses responsibility for review and analysis of the 
reasonableness of subcontract prices.
    (3) Indicators of potentially significant estimating deficiencies. 
The following examples indicate conditions that may produce or lead to 
significant estimating deficiencies--
    (i) Failure to ensure that historical experience is available to and 
utilized by cost estimators, where appropriate;
    (ii) Continuing failure to analyze material costs or failure to 
perform subcontractor cost reviews as required.
    (iii) Consistent absence of analytical support for significant 
proposed cost amounts;
    (iv) Excessive reliance on individual personal judgment where 
historical experience or commonly utilized standards are available;
    (v) Recurring significant defective pricing findings within the same 
cost element(s);
    (vi) Failure to integrate relevant parts of other management systems 
(e.g., production control or cost accounting) with the estimating system 
so that the ability to generate reliable cost estimates is impaired; and
    (vii) Failure to provide established policies, procedures, and 
practices to persons responsible for preparing and supporting estimates.
    (e) Review Procedures. Cognizant audit and contract administration 
activities shall--
    (1) Establish and manage regular programs for reviewing selected 
contractors' estimating systems.
    (2) Conduct reviews as a team effort.
    (i) The contract auditor will be the team leader.
    (ii) The team leader will--
    (A) Coordinate with the ACO to ensure that team membership includes 
qualified contract administration technical specialists.
    (B) Advise the ACO and contractor of significant findings during the 
conduct of the review and during the exit conference.
    (C) Prepare a team report.
    (1) The ACO or a representative should--
    (i) Coordinate the contract administration activity's review;
    (ii) Consolidate findings and recommendations; and
    (iii) When appropriate, prepare a comprehensive written report for 
submission to the auditor.
    (2) The contract auditor will attach the ACO's report to the team 
report.
    (3) Tailor reviews to take full advantage of the day-to-day work 
done by both organizations.
    (4) Conduct a review every three years of contractors subject to the 
disclosure requirements. The ACO and auditor may lengthen or shorten the 
three-year period based on their joint risk assessment of the 
contractor's past experience and current vulnerability.
    (f) Disposition of survey team findings--(1) Reporting of survey 
team findings. The auditor will document the findings and 
recommendations of the survey team in a report to the ACO. If there are 
significant estimating deficiencies, the auditor will recommend 
disapproval of all or portions of the estimating system.
    (2) Initial notification to the contractor. The ACO will provide a 
copy of the team report to the contractor and, unless there are no 
deficiencies mentioned in the report, ask the contractor to submit a 
written response in 30 days, or a reasonable extension.
    (i) If the contractor agrees with the report, the contractor has 60 
days from the date of initial notification to correct any identified 
deficiencies or submit a corrective action plan showing milestones and 
actions to eliminate the deficiencies.
    (ii) If the contractor disagrees, the contractor should provide 
rationale in its written response.
    (3) Evaluation of contractor's response. The ACO, in consultation 
with the auditor, will evaluate the contractor's response to determine 
whether--

[[Page 89]]

    (i) The estimating system contains deficiencies which need 
correction;
    (ii) The deficiencies are significant estimating deficiencies which 
would result in disapproval of all or a portion of the contractor's 
estimating system; or
    (iii) The contractor's proposed corrective actions are adequate to 
eliminate the deficiency.
    (4) Notification of ACO determination. The ACO will notify the 
contractor and the auditor of the determination and, if appropriate, of 
the Government's intent to disapprove all or selected portions of the 
system. The notice shall--
    (i) List the cost elements covered;
    (ii) Identify any deficiencies requiring correction; and
    (iii) Require the contractor to correct the deficiencies within 45 
days or submit an action plan showing milestones and actions to 
eliminate the deficiencies.
    (5) Notice of disapproval. If the contractor has neither submitted 
an acceptable corrective action plan nor corrected significant 
deficiencies within 45 days, the ACO shall disapprove all or selected 
portions of the contractor's estimating system. The notice of 
disapproval must--
    (i) Identify the cost elements covered;
    (ii) List the deficiencies which prompted the disapproval; and
    (iii) Be sent to the cognizant auditor, and each contracting and 
contract administration office having substantial business with the 
contractor.
    (6) Monitoring contractor's corrective action. The auditor and ACO 
will monitor the contractor's progress in correcting deficiencies. If 
the contractor fails to make adequate progress, the ACO shall take 
whatever action is necessary to ensure that the contractor corrects the 
deficiencies. Examples of actions the ACO can take are: Bringing the 
issue to the attention of higher level management, reducing or 
suspending progress payments (see FAR 32.503-6), and recommending 
nonaward of potential contracts.
    (7) Withdrawal of estimating system disapproval. The ACO will 
withdraw the disapproval when the ACO determines that the contractor has 
corrected the significant system deficiencies. The ACO will notify the 
contractor, the auditor, and affected contracting and contract 
administration activities of the withdrawal.
    (g) Impact of estimating system deficiencies on specific proposals. 
(1) Field pricing teams will discuss identified estimating system 
deficiencies and their impact in all reports on contractor proposals 
until the deficiencies are resolved.
    (2) The contracting officer responsible for negotiation of a 
proposal generated by an estimating system with an identified deficiency 
shall evaluate whether the deficiency impacts the negotiations. If it 
does not, the contracting officer should proceed with negotiations. If 
it does, the contracting officer should consider other alternatives, 
e.g.--
    (i) Allowing the contractor additional time to correct the 
estimating system deficiency and submit a corrected proposal;
    (ii) Considering another type of contract, e.g., an FPIF instead of 
an FFP;
    (iii) Using additional cost analysis techniques to determine the 
reasonableness of the cost elements affected by the system's deficiency;
    (iv) Segregating the questionable areas as a cost reimbursable line 
item;
    (v) Reducing the negotiation objective for profit or fee; or
    (vi) Including a contract (reopener) clause that provides for 
adjustment of the contract amount after award.
    (3) The contracting officer who incorporates a reopener clause into 
the contract is responsible for negotiating price adjustments required 
by the clause. Any reopener clause necessitated by an estimating 
deficiency should--
    (i) Clearly identify the amounts and items which are in question at 
the time of negotiation;
    (ii) Indicate a specific time or subsequent event by which the 
contractor will submit a supplemental proposal, including cost or 
pricing data, identifying the cost impact adjustment necessitated by the 
deficient estimating system;
    (iii) Provide for the contracting officer to unilaterally adjust the 
contract price if the contractor fails to submit the supplemental 
proposal; and

[[Page 90]]

    (iv) Provide that failure of the Government and the contractor to 
agree to the price adjustment shall be a dispute under the Disputes 
clause.
    (h) Contract clause. Use the clause at 252.215-7002, Cost Estimating 
System Requirements, in all solicitations and contracts to be awarded on 
the basis of cost or pricing data.
[56 FR 36326, July 31, 1991, as amended at 56 FR 67213, Dec. 30, 1991; 
62 FR 40472, July 29, 1997]



215.870--215.872  [Reserved]



215.873  Estimated data prices.

    (a) The Department of Defense requires estimates of the prices of 
data in order to evaluate the cost to the Government of data items in 
terms of their management, product, or engineering value.
    (b) When data are required to be delivered under a contract, the 
solicitation will include DD Form 1423, Contract Data Requirements List. 
The form and the provision included in the solicitation request the 
offeror to state what portion of the total price is estimated to be 
attributable to the production or development of the listed data for the 
Government (not to the sale of rights in the data). However, offerors' 
estimated prices may not reflect all such costs; and different offerors 
may reflect these costs in a different manner, for the following 
reasons--
    (1) Differences in business practices in competitive situations;
    (2) Differences in accounting systems among offerors;
    (3) Use of factors or rates on some portions of the data;
    (4) Application of common effort to two or more data items; and
    (5) Differences in data preparation methods among offerors.
    (c) Data price estimates should not be used for contract pricing 
purposes without further analysis.
    (d) The contracting officer shall ensure that the contract does not 
include a requirement for data that the contractor has delivered or is 
obligated to deliver to the Government under another contract or 
subcontract, and that the successful offeror identifies any such data 
required by the solicitation. However, where duplicate data are desired, 
the contract price shall include the costs of duplication, but not of 
preparation, of such data.
[56 FR 36326, July 31, 1991, as amended at 62 FR 2613, Jan. 17, 1997]



                          Subpart 215.9--Profit



215.902  Policy.

    Departments and agencies shall use a structured approach for 
developing a prenegotiation profit or fee objective (profit objective) 
on any negotiated contract action that requires cost analysis, except on 
cost-plus-award-fee contracts (but see 215.974). There are three 
approaches--
    (1) The weighted guidelines method;
    (2) The modified weighted guidelines method; and
    (3) An alternate structured approach.



215.903  Contracting officer responsibilities.

    (a) Also, do not perform a profit analysis when assessing cost 
realism in competitive acquisitions.
    (b) The contracting officer--
    (1) Shall use the weighted guidelines method (see 215.971), unless--
    (A) The modified weighted guidelines method applies; or
    (B) An alternate approach is justified.
    (2) Shall use the modified weighted guidelines method (see 215.972) 
on contract actions with nonprofit organizations;
    (3) May use an alternate structured approach (see 215.973) when--
    (i) The contract action is--
    (A) Under $500,000;
    (B) For architect-engineer or construction work;
    (C) Primarily for delivery of material from subcontractors; or
    (D) A termination settlement; or
    (ii) The weighted guidelines method does not produce a reasonable 
overall profit objective and the head of the contracting activity 
approves use of the alternate approach in writing.
    (4) Shall use the weighted guidelines method to establish a basic 
profit rate under a formula type pricing agreement, and may then use the 
basic rate on all actions under the agreement, provided that conditions 
affecting profit do not change.

[[Page 91]]

    (5) Shall document the profit analysis in the price negotiation 
memorandum.
    (e) Although specific agreement on the applied weights or values for 
individual profit factors shall not be attempted, the contracting 
officer may encourage the contractor to--
    (1) Present the details of its proposed profit amounts in the 
weighted guidelines format or similar structured approach; and
    (2) Use the weighted guidelines method in developing profit 
objectives for negotiated subcontracts.
    (f) The contracting officer must also verify that relevant variables 
have not materially changed (e.g., performance risk, interest rates, 
progress payment rates, distribution of facilities capital).



215.905  Profit-analysis factors.



215.905-1  Common factors.

    The common factors are embodied in the DoD structured approaches and 
need not be further considered by the contracting officer.



215.970  DD Form 1547, Record of Weighted Guidelines Method Application.

    (a) The DD Form 1547--
    (1) Provides a vehicle for performing the analysis necessary to 
develop a profit objective;
    (2) Provides a format for summarizing profit amounts subsequently 
negotiated as part of the contract price; and
    (3) Serves as the principal source document for reporting profit 
statistics to DoD's management information system.
    (b) The Military Departments are responsible for establishing 
policies and procedures for feeding the DoD-wide management information 
system on profit and fee statistics (see 215.975).
    (c) The contracting officer shall--
    (1) Use and prepare a DD Form 1547 whenever a structured approach to 
profit analysis is required by 215.902. (See 215.971, 215.972, and 
215.973 for guidance on using the structured approaches.) Administrative 
instructions for completing the form are in 253.215-70.
    (2) Ensure that the DD Form 1547 is accurately completed. The 
contracting officer is responsible for the correction of any errors 
detected by the management system auditing process.



215.971  Weighted guidelines method.



215.971-1  General.

    (a) The weighted guidelines method focuses on three profit factors--
    (1) Performance risk;
    (2) Contract type risk; and
    (3) Facilities capital employed.
    (b) The contracting officer assigns values to each profit factor; 
the value multiplied by the base results in the profit objective for 
that factor. Each profit factor has a normal value and a designated 
range of values. The normal value is representative of average 
conditions on the prospective contract when compared to all goods and 
services acquired by DoD. The designated range provides values based on 
above normal or below normal conditions. In the price negotiation 
memorandum, the contracting officer need not explain assignment of the 
normal value, but should address conditions that justify assignment of 
other than the normal value.



215.971-2  Performance risk.

    (a) Description. This profit factor addresses the contractor's 
degree of risk in fulfilling the contract requirements. The factor 
consists of three parts--
    (1) Technical--the technical uncertainties of performance.
    (2) Management--the degree of management effort necessary to ensure 
that contract requirements are met.
    (3) Cost control--the contractor's efforts to reduce and control 
costs.
    (b) Determination. The following extract from the DD Form 1547 is 
annotated to describe the process.

                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                                                Assigned     Assigned    Base (Item     Profit  
            Item                  Contractor Risk Factors      Weighting      Value         18)       Objective 
----------------------------------------------------------------------------------------------------------------
21..........................  Technical.....................          (1)          (2)          N/A          N/A
22..........................  Management....................          (1)          (2)          N/A          N/A
23..........................  Cost Control..................          (1)          (2)          N/A          N/A
24..........................  Performance Risk (Composite)..          N/A          (3)          (4)          (5)

[[Page 92]]

                                                                                                                
----------------------------------------------------------------------------------------------------------------

    (1) Assign a weight (percentage) to each element according to its 
input to the total performance risk. The total of the three weights 
equals 100%.
    (2) Select a value for each element from the list in paragraph (c) 
of this subsection using the evaluation criteria in paragraphs (d), (e), 
and (f) of this subsection.
    (3) Compute the composite as shown in the following example--

                                                                        
------------------------------------------------------------------------
                                       Assigned    Assigned    Weighted 
             Assigned--                weighting     value       value  
                                       (percent)   (percent)   (percent)
------------------------------------------------------------------------
Technical...........................          30         5.0         1.5
Management..........................          30         4.0         1.2
Cost Control........................          40         4.5         1.8
Composite Value.....................         100                     4.5
------------------------------------------------------------------------

    (4) Insert the amount from Block 18 of the DD Form 1547. Block 18 is 
total contract costs, excluding general and administrative expenses, 
contractor independent research and development/bid and proposal 
expenses, and facilities capital cost of money.
    (5) Multiply (3) by (4).
    (c) Values: Normal and designated ranges.

                                                                        
------------------------------------------------------------------------
                                         Normal                         
          Standard Alternate              value       Designated range  
                                        (percent)        (percent)      
------------------------------------------------------------------------
Standard.............................           4  2 to 6.              
Alternate............................           6  4 to 8               
------------------------------------------------------------------------

    (1) Standard. The standard designated range should apply to most 
contracts.
    (2) Alternate. Contracting officers may use the alternate designated 
range for research and development and service contractors when these 
contractors require relatively low capital investment in buildings and 
equipment when compared to the defense industry overall. If the 
alternate designated range is used, do not give any profit for 
facilities capital employed (see 215.971-4(c)(3)).
    (d) Evaluation criteria for technical. (1) Review the contract 
requirements and focus on the critical performance elements in the 
statement of work or specifications. Factors to consider include--
    (i) Technology being applied or developed by the contractor;
    (ii) Technical complexity;
    (iii) Program maturity;
    (iv) Performance specifications and tolerances;
    (v) Delivery schedule; and
    (vi) Extent of a warranty or guarantee.
    (2) Above normal conditions. (i) The contracting officer may assign 
a higher than normal value in those cases where there is a substantial 
technical risk. Indicators are--
    (A) The contractor is either developing or applying advanced 
technologies;
    (B) Items are being manufactured using specifications with stringent 
tolerance limits;
    (C) The efforts require highly skilled personnel or require the use 
of state of the art machinery;
    (D) The services and analytical efforts are extremely important to 
the Government and must be performed to exacting standards;
    (E) The contractor's independent development and investment has 
reduced the Government's risk or cost;
    (F) The contractor has accepted an accelerated delivery schedule to 
meet DoD requirements; or
    (G) The contractor has assumed additional risk through warranty 
provisions.
    (ii) Extremely complex, vital efforts to overcome difficult 
technical obstacles which require personnel with exceptional abilities, 
experience, and professional credentials may justify a value 
significantly above normal.
    (iii) The following may justify a maximum value--
    (A) Development or initial production of a new item, particularly if 
performance or quality specifications are tight; or
    (B) A high degree of development or production concurrency.
    (3) Below normal conditions.
    (i) The contracting officer may assign a lower than normal value in 
those cases where the technical risk is low. Indicators are--
    (A) Acquisition is for off-the-shelf items;
    (B) Requirements are relatively simple;
    (C) Technology is not complex;
    (D) Efforts do not require highly skilled personnel;
    (E) Efforts are routine;
    (F) Programs are mature; or

[[Page 93]]

    (G) Acquisition is a follow-on effort or a repetitive type 
acquisition.
    (ii) The contracting officer may assign a value significantly below 
normal for--
    (A) Routine services;
    (B) Production of simple items;
    (C) Rote entry or routine integration of Government furnished 
information; or
    (D) Simple operations with Government-furnished property.
    (e) Evaluation criteria for management. (1) The contracting officer 
should--
    (i) Assess the contractor's management and internal control systems 
using contracting office information and reviews made by field contract 
administration offices or other DoD field offices;
    (ii) Assess the management involvement expected on the prospective 
contract action;
    (iii) Consider the degree of cost mix as an indication of the types 
of resources applied and value-added by the contractor; and
    (iv) Consider the contractor's support of Federal socioeconomic 
programs.
    (2) Above normal conditions. (i) The contracting officer may assign 
a higher than normal value when the management effort is intense. 
Indicators of this are--
    (A) The contractor's value-added is both considerable and reasonably 
difficult;
    (B) The effort involves a high degree of integration or 
coordination; or
    (C) The contractor has a substantial record of active participation 
in Federal socioeconomic programs.
    (ii) The contracting officer may justify a maximum value when the 
effort--
    (A) Requires large scale integration of the most complex nature;
    (B) Involves major international activities with significant 
management coordination (e.g., offsets with foreign vendors); or
    (C) Has critically important milestones.
    (3) Below normal conditions. (i) The contracting officer may assign 
a lower than normal value when the management effort is minimal. 
Indicators of this are--
    (A) The program is mature and many end item deliveries have been 
made;
    (B) The contractor adds minimum value to an item;
    (C) The efforts are routine and require minimal supervision;
    (D) The contractor provides poor quality, untimely proposals;
    (E) The contractor fails to provide an adequate analysis of 
subcontractor costs; or
    (F) The contractor does not cooperate in the evaluation and 
negotiation of the proposal.
    (ii) The following may justify a value significantly below normal--
    (A) Reviews performed by the field contract administration offices 
disclose unsatisfactory management and internal control systems (e.g., 
quality assurance, property control, safety, security); or
    (B) The effort requires an unusually low degree of management 
involvement.
    (f) Evaluation criteria for cost control. (1) The contracting 
officer should evaluate--
    (i) The expected reliability of the contractor's cost estimates 
(including the contractor's cost estimating system);
    (ii) The contractor's cost reduction initiatives (e.g., competition 
advocacy programs, dual sourcing, spare parts pricing reform, value 
engineering);
    (iii) The adequacy of the contractor's management approach to 
controlling cost and schedule; and
    (iv) Any other factors which affect the contractor's ability to meet 
the cost targets, e.g., foreign currency exchange rates and inflation 
rates.
    (2) Above normal conditions. The contracting officer may assign a 
higher than normal value if the contractor can demonstrate a highly 
effective cost control program. Indicators of this are--
    (i) The contractor provides fully documented and reliable cost 
estimates;
    (ii) The contractor has an aggressive cost reduction program that 
has demonstrable benefits;
    (iii) The contractor uses a high degree of subcontract competition 
(e.g., aggressive dual sourcing); or
    (iv) The contractor has a proven record of cost tracking and 
control.

[[Page 94]]

    (3) Below normal conditions. The contracting officer may assign a 
lower than normal value if the contractor demonstrates minimal concern 
for cost control. Indicators are--
    (i) The contractor's cost estimating system is marginal;
    (ii) The contractor has made minimal effort to initiate cost 
reduction programs;
    (iii) The contractor's cost proposal is inadequate;
    (iv) The contractor has a record of cost overruns or other 
indication of unreliable cost estimates and lack of cost control.



215.971-3  Contract type risk and working capital adjustment.

    (a) Description. The contract type risk factor focuses on the degree 
of cost risk accepted by the contractor under varying contract types. 
The working capital adjustment is an adjustment added to the profit 
objective for contract type risk. It only applies to fixed-price 
contracts that provide for progress payments. Though it uses a formula 
approach, it is not intended to be an exact calculation of the cost of 
working capital. Its purpose is to give general recognition to the 
contractor's cost of working capital under varying contract 
circumstances, financing policies, and the economic environment.
    (b) Determination. The following extract from the DD 1547 is 
annotated to explain the process. ns,tp0,p6,6/7,

------------------------------------------------------------------------
                  Contractor risk    Assigned    Base (Item     Profit  
      Item            factors         value         18)       objective 
------------------------------------------------------------------------
25.............  Contract Type             (1)          (2)          (3)
                  Risk.                                                 
------------------------------------------------------------------------


----------------------------------------------------------------------------------------------------------------
                                                                  Cost        Length      Interest              
                                                                financed      factor        rate                
----------------------------------------------------------------------------------------------------------------
26..........................  Working Capital (4)...........          (5)          (6)          (7)          (8)
----------------------------------------------------------------------------------------------------------------

    (1) Select a value from the list of contract types in paragraph (c) 
of this subsection using the evaluation criteria in paragraph (d) of 
this subsection.
    (2) Insert the amount from Block 18, i.e., the total allowable costs 
excluding general and administrative expenses, independent research and 
development/bid proposal expenses, and facilities capital cost of money.
    (3) Multiply (1) by (2).
    (4) Only complete this Block when the prospective contract is a 
fixed-price contract containing provisions for progress payments.
    (5) Insert the amount computed per paragraph (e) of this subsection.
    (6) Insert the appropriate figure from paragraph (f) of this 
subsection.
    (7) Use the interest rate established by the Secretary of the 
Treasury (230.7101(a)). Do not use any other interest rate.
    (8) Multiply (5) by (6) by (7). This is the working capital 
adjustment. It shall not exceed 4 percent of the contract costs in Block 
20.
    (c) Values: Normal and designated ranges.

------------------------------------------------------------------------
                                               Normal                   
         Contract type              Notes       value       Designated  
                                              (percent)  range (percent)
------------------------------------------------------------------------
Firm fixed-price, no financing.         (1)           5  4 to 6.        
Firm fixed-price, with                  (2)           3  2 to 4.        
 financing.                                                             
Fixed-price-incentive, no               (1)           3  2 to 4.        
 financing.                                                             
Fixed-price with redeterminable         (3)                             
 provision.                                                             
Fixed-price-incentive, with             (2)           1  0 to 2.        
 financing.                                                             
Cost-plus-incentive-fee........         (4)           1  0 to 2.        
Cost-plus-fixed-fee............         (4)          .5  0 to 1.        
Time and material contracts             (5)          .5  0 to 1.        
 (including overhaul contracts                                          
 priced on time and material                                            
 basis).                                                                
Labor-hour contracts...........         (5)          .5  0 to 1.        
Firm fixed-price-level-of-              (5)          .5  0 to 1.        
 effort-term.                                                           

[[Page 95]]

                                                                        
------------------------------------------------------------------------

    (1) No financing means that the contract either does not provide 
progress payments, or provides them only on a limited basis, such as 
financing of first articles. Do not compute a working capital 
adjustment.
    (2) With financing means progress payments. When progress payments 
are present, compute a working capital adjustment (Block 26).
    (3) For the purposes of assigning profit values, treat a fixed-price 
contract with redeterminable provisions as if it were a fixed-price-
incentive contract with below normal conditions.
    (4) Cost-plus contracts shall not receive the working capital 
adjustment.
    (5) These types of contracts are considered cost-plus-fixed-fee 
contracts for the purposes of assigning profit values. They shall not 
receive the working capital adjustment in Block 26. However, they may 
receive higher than normal values within the designated range to the 
extent that portions of cost are fixed.
    (d) Evaluation criteria--(1) General. The contracting officer should 
consider elements that affect contract type risk such as--
    (i) Length of contract;
    (ii) Adequacy of cost data for projections;
    (iii) Economic environment;
    (iv) Nature and extent of subcontracted activity;
    (v) Protection provided to the contractor under contract provisions 
(e.g., economic price adjustment clauses);
    (vi) The ceilings and share lines contained in incentive provisions; 
and
    (vii) Risks associated with contracts for foreign military sales 
(FMS) which are not funded by U.S. appropriations.
    (2) Mandatory--The contracting officer shall assess the extent to 
which costs have been incurred prior to definitization of the contract 
action (see also 217.7404-6(a)). The assessment shall include any 
reduced contractor risk on both the contract before definitization and 
the remaining portion of the contract. When costs have been incurred 
prior to definitization, generally regard the contract type risk to be 
in the low end of the designated range. If a substantial portion of the 
costs have been incurred prior to definitization, the contracting 
officer may assign a value as low as 0%, regardless of contract type.
    (3) Above normal conditions. The contracting officer may assign a 
higher than normal value when there is substantial contract type risk. 
Indicators of this are--
    (i) Efforts where there is minimal cost history;
    (ii) Long-term contracts without provisions protecting the 
contractor, particularly when there is considerable economic 
uncertainty;
    (iii) Incentive provisions (e.g., cost and performance incentives) 
which place a high degree of risk on the contractor; or
    (iv) FMS sales (other than those under DoD cooperative logistics 
support arrangements or those made from U.S. Government inventories or 
stocks) where the contractor can demonstrate that there are substantial 
risks above those normally present in DoD contracts for similar items.
    (4) Below normal conditions. The contracting officer may assign a 
lower than normal value when the contract type risk is low. Indicators 
of this are--
    (i) Very mature product line with extensive cost history;
    (ii) Relatively short-term contracts;
    (iii) Contractual provisions which substantially reduce the 
contractor's risk; or
    (iv) Incentive provisions which place a low degree of risk on the 
contractor.
    (e) Costs financed. (1) Costs financed equal total costs multiplied 
by the portion (percent) of costs financed by the contractor.
    (2) Total costs equal Block 20 (i.e., all allowable costs, including 
general and administrative and independent research and development/bid 
and proposal, but excluding facilities capital cost of money), reduced 
as appropriate when--
    (i) The contractor has little cash investment (e.g., subcontractor 
progress payments liquidated late in period of performance);
    (ii) Some costs are covered by special financing provisions, such as 
advance payments; or
    (iii) The contract is multiyear and there are special funding 
arrangements.

[[Page 96]]

    (3) The portion financed by the contractor is generally the portion 
not covered by progress payments, i.e., 100% minus the customary 
progress payment rate (FAR 32.501). For example, if a contractor 
receives progress payments at 75%, the portion financed by the 
contractor is 25%. On contracts that provide flexible progress payments 
(252.232-7003) or progress payments to small businesses, use the 
customary progress payment rate for large businesses.
    (f) Contract length factor. (1) This is the period of time that the 
contractor has a working capital investment in the contract. It--
    (i) Is based on the time necessary for the contractor to complete 
the substantive portion of the work;
    (ii) Is not necessarily the period of time between contract award 
and final delivery (or final payment), as periods of minimal effort 
should be excluded;
    (iii) Should not include periods of performance contained in option 
provisions; and
    (iv) Should not, for multiyear contracts, include periods of 
performance beyond that required to complete the initial program year's 
requirements.
    (2) The contracting officer--
    (i) Should use the following table to select the contract length 
factor;
    (ii) Should develop a weighted average contract length when the 
contract has multiple deliveries; and
    (iii) May use sampling techniques provided they produce a 
representative result.

                                  Table                                 
------------------------------------------------------------------------
                                                               Contract 
     Period to perform substantive portion (in months)          length  
                                                                factor  
------------------------------------------------------------------------
21 or less.................................................          .40
22 to 27...................................................          .65
28 to 33...................................................          .90
34 to 39...................................................         1.15
40 to 45...................................................         1.40
46 to 51...................................................         1.65
52 to 57...................................................         1.90
58 to 63...................................................         2.15
64 to 69...................................................         2.40
70 to 75...................................................         2.65
76 or more.................................................         2.90
------------------------------------------------------------------------

    (3) Example: A prospective contract has a performance period of 40 
months with end items being delivered in the 34th, 36th, 38th, and 40th 
months of the contract. The average period is 37 months and the contract 
length factor is 1.15.
[56 FR 36326, July 31, 1991, as amended at 59 FR 27669, May 27, 1994]



215.971-4  Facilities capital employed.

    (a) Description. This factor focuses on encouraging and rewarding 
aggressive capital investment in facilities that benefit DoD. It 
recognizes both the facilities capital that the contractor will employ 
in contract performance and the contractor's commitment to improving 
productivity.
    (b) Determination. The following extract from the DD Form 1547 has 
been annotated to explain the process.

                                                                        
------------------------------------------------------------------------
                    Contractor                                          
      Item          facilities       Assigned      Amount       Profit  
                 capital employed     value       employed    objective 
------------------------------------------------------------------------
27.............  Land............          N/A          (2)          N/A
28.............  Buildings.......          (1)          (2)          (3)
29.............  Equipment.......          (1)          (2)          (3)
------------------------------------------------------------------------

    (1) Select a value from the list in paragraph (c) of this subsection 
using the evaluation criteria in paragraph (d) of this subsection.
    (2) Use the allocated facilities capital attributable to land, 
buildings, and equipment, as derived in DD Form 1861, ``Contract 
Facilities Capital Cost of Money'' (see 215.871-5 and 230.7001).
    (i) In addition to the net book value of facilities capital 
employed, consider facilities capital that is part of a formal 
investment plan if the contractor submits reasonable evidence that--
    (A) Achievable benefits to DoD will result from the investment; and
    (B) The benefits of the investment are included in the forward 
pricing structure.
    (ii) If the value of intracompany transfers has been included in 
Block 18

[[Page 97]]

at cost (i.e., excluding general and administrative (G&A) expenses and 
profit), add to the contractor's allocated facilities capital, the 
allocated facilities capital attributable to the buildings and equipment 
of those corporate divisions supplying the intracompany transfers. Do 
not make this addition if the value of intracompany transfers has been 
included in Block 18 at price (i.e., including G&A expenses and profit).
    (3) Multiply (1) by (2).
    (c) Values: Normal and designated ranges.

                                                                        
------------------------------------------------------------------------
                                            Normal                      
      Notes              Asset type          value     Designated range 
                                           (percent)                    
------------------------------------------------------------------------
(1)..............  Land.................           0  N/A.              
(1)..............  Buildings............          15  10% to 20%.       
(1)..............  Equipment............          35  20% to 50%.       
(2)..............  Land.................           0  N/A.              
(2)..............  Buildings............           5  0% to 10%.        
(2)..............  Equipment............          20  15% to 25%.       
(3)..............  Land.................           0  N/A.              
(3)..............  Buildings............           0  0%.               
(3)..............  Equipment............           0  0%.               
------------------------------------------------------------------------

    (1) These are the normal values and ranges. They apply to all 
situations except those noted in (2) and (3).
    (2) These alternate values and ranges apply to situations where a 
highly facilitized manufacturing firm will be performing a research and 
development or services contract. They balance the method used to 
allocate facilities capital cost of money, which may produce 
disproportionate allocation of assets to these types of efforts.
    (3) When using a value from the alternate designated range for the 
performance risk factor (215.971-2(c)(2)), do not allow profit on 
facilities capital employed.
    (d) Evaluation criteria. (1) In evaluating facilities capital 
employed, the contracting officer--
    (i) Should relate the usefulness of the facilities capital to the 
goods or services being acquired under the prospective contract;
    (ii) Should analyze the productivity improvements and other 
anticipated industrial base enhancing benefits resulting from the 
facilities capital investment, including--
    (A) The economic value of the facilities capital, such as physical 
age, undepreciated value, idleness, and expected contribution to future 
defense needs; and
    (B) The contractor's level of investment in defense related 
facilities as compared with the portion of the contractor's total 
business which is derived from DoD;
    (iii) Should consider any contractual provisions that reduce the 
contractor's risk of investment recovery, such as termination protection 
clause, capital investment indemnification, and productivity saving 
rewards (215.870-3); and
    (iv) Shall ensure that increases in facilities capital investments 
are not merely asset revaluations attributable to mergers, stock 
transfers, take-overs, sales of corporate entities, or similar actions.
    (2) Above normal conditions. (i) The contracting officer may assign 
a higher than normal value if the facilities capital investment has 
direct, identifiable, and exceptional benefits. Indicators are--
    (A) New investments in state-of-the-art technology which reduce 
acquisition cost or yield other tangible benefits such as improved 
product quality or accelerated deliveries;
    (B) Investments in new equipment for research and development 
applications; or
    (C) Contractor demonstration that the investments are over and above 
the normal capital investments necessary to support anticipated 
requirements of DoD programs.
    (ii) The contracting officer may assign a value significantly above 
normal when there are direct and measurable benefits in efficiency and 
significantly reduced acquisition costs on the effort being priced. 
Maximum values apply only to those cases where the benefits of the 
facilities capital investment are substantially above normal.
    (3) Below normal conditions. (i) The contracting officer may assign 
a lower than normal value if the facilities capital investment has 
little benefit to DoD. Indicators are--
    (A) Allocations of capital apply predominantly to commercial item 
lines;
    (B) Investments are for such things as furniture and fixtures, home 
or

[[Page 98]]

group level administrative offices, corporate aircraft and hangars, 
gymnasiums; or
    (C) Facilities are old or extensively idle.
    (ii) The contracting officer may assign a value significantly below 
normal when a significant portion of defense manufacturing is done in an 
environment characterized by outdated, inefficient, and labor-intensive 
capital equipment.
[56 FR 36326, July 31, 1991, as amended at 60 FR 61596, Nov. 30, 1995]



215.972  Modified weighted guidelines method for nonprofit organizations.

    (a) Definition. As used in this subpart, a nonprofit organization is 
a business entity--
    (1) Which operates exclusively for charitable, scientific, or 
educational purposes;
    (2) Whose earnings do not benefit any private shareholder or 
individual;
    (3) Whose activities do not involve influencing legislation or 
political campaigning for any candidate for public office; and
    (4) Which is exempted from Federal income taxation under section 501 
of the Internal Revenue Code.
    (b) For nonprofit organizations which are Federally funded research 
and development centers (FFRDCs), the contracting officer--
    (1) Should consider whether any fee is appropriate. Considerations 
shall include the FFRDC's--
    (i) Proportion of retained earnings (as established under generally 
accepted accounting methods) that relates to DoD contracted effort;
    (ii) Facilities capital acquisition plans;
    (iii) Working capital funding as assessed on operating cycle cash 
needs;
    (iv) Contingency funding; and
    (v) Provision for funding unreimbursed costs deemed ordinary and 
necessary to the FFRDC.
    (2) Shall, when a fee is considered appropriate, compute the fee 
objective using the weighted guidelines method in 215.971, with the 
following modifications--
    (i) Modifications to performance risk (Blocks 21-24 of the DD Form 
1547). (A) If the contracting officer assigns a value from the standard 
designated range (215.971-2(c)), reduce the fee objective by an amount 
equal to 1% of the costs in Block 18 of the DD Form 1547. Show the net 
(reduced) amount on the DD Form 1547.
    (B) If the contracting officer assigns a value from the alternate 
designated range, reduce the fee objective by an amount equal to 2% of 
the costs in Block 18 of the DD Form 1547. Show the net (reduced) amount 
on the DD Form 1547.
    (ii) Modifications to contract type risk (Block 25 of the DD Form 
1547). Use a designated range of -1% to 0% in lieu of the values in 
215.971-3. There is no normal value.
    (c) For nonprofit organizations which are entities that have been 
identified by the Secretary of Defense or a Secretary of a Department as 
receiving sustaining support on a cost-plus-fixed-fee basis from a 
particular DoD department or agency, compute a fee objective for covered 
actions using the weighted guidelines method in 215.971, modified as 
described in paragraph (b)(2) of this section.
    (d) For all other nonprofit organizations, compute a fee objective 
for covered actions using the weighted guidelines method in 215.971, 
modified as described in paragraph (b)(2)(i) of this section.



215.973  Alternate structured approaches.

    (a) The contracting officer may use an alternate structured approach 
under 215.903.
    (b) The contracting officer may design the structure of the 
alternate, but it shall include--
    (1) Consideration of the three basic components of profit--
performance risk, contract type risk (including working capital), and 
facilities capital employed. However, the contracting officer is not 
required to complete Blocks 21 through 30 of the DD Form 1547.
    (2) Offset for facilities capital cost of money.
    (i) The contracting officer shall reduce the overall prenegotiation 
profit objective by the lesser of 1% of total cost or the amount of 
facilities capital cost of money. The profit amount in

[[Page 99]]

the negotiation summary of the DD Form 1547 must be net of the offset.
    (ii) This adjustment is needed for the following reason: The values 
of the profit factors used in the weighted guidelines method were 
adjusted to recognize the shift in facilities capital cost of money from 
an element of profit to an element of contract cost (FAR 31.205-10) and 
reductions were made directly to the profit factors for performance 
risk. In order to ensure that this policy is applied to all DoD 
contracts which allow facilities capital cost of money, similar 
adjustments shall be made to contracts which use alternate structured 
approaches.



215.974  Fee requirements for cost-plus-award-fee contracts.

    In developing a fee objective for cost-plus-award-fee contracts, the 
contracting officer shall--
    (a) Follow the guidance in FAR 16.404-2 and 216.404-2;
    (b) Not use the weighted guidelines method or alternate structured 
approach;
    (c) Apply the offset policy in 215.973(b)(2) for facilities capital 
cost of money, i.e., reduce the base fee by the lesser of 1% of total 
costs or the amount of facilities capital cost of money; and
    (d) Not complete a DD Form 1547.



215.975  Reporting profit and fee statistics.

    (a) Contracting officers in contracting offices which participate in 
the management information system for profit and fee statistics send 
completed DD Forms 1547 on actions of $500,000 or more, where the 
contracting officer used either the weighted guidelines method, an 
alternate structured approach, or the modified weighted guidelines 
method, to their designated office within 30 days after contract award.
    (b) Participating contracting offices and their designated offices 
are--

                                                                        
------------------------------------------------------------------------
            Contracting office                    Designated office     
------------------------------------------------------------------------
Army:                                                                   
  All                                       Army Procurement Research   
                                             and Analysis Office, ATTN: 
                                             SFRD-KPR(WGL), Bldg 12500, 
                                             C Wing, Ft. Lee, VA 23801- 
                                             6045.                      
Navy:                                                                   
  Naval Air Systems Command \1\             Commander, Naval Supply     
                                             Systems Command, ATTN: SUP 
                                             026, Washington, DC 20376- 
                                             5000.                      
  Naval Sea Systems Command \1\                                         
  Space and Naval Warfare Systems Command                               
   \1\                                                                  
  Naval Facilities Engineering Command \1\                              
  Naval Supply Systems Command \1\                                      
  Office of Naval Research \1\                                          
  Headquarters, United States Marine Corps                              
   \1\                                                                  
  Strategic Systems Programs Office \1\                                 
  Military Sealift Command \1\                                          
  Automatic Data Processing Selection                                   
   Office \1\                                                           
  Navy Regional Data Automation Center \1\                              
  Naval Research Laboratory \1\                                         
  Navy Commercial Communications Center                                 
   \1\                                                                  
  Naval Aviation Depot Operations Center                                
   \1\                                                                  
Air Force:                                                              
  Air Force Materiel Command (all field     Air Force Materiel Command, 
   offices)                                  645 CCSG/SCOS, ATTN: J010  
                                             Clerk, 2721 Sacramento     
                                             Street, Wright-Patterson   
                                             Air Force Base, Ohio 45433.
------------------------------------------------------------------------
\1\ Includes all subordinate field offices.                             

    (c) When negotiation of a contract action over $500,000 has been 
delegated to another contracting agency (e.g., to an administrative 
contracting officer), that agency shall ensure that a copy of the DD 
Form 1547 is provided to the delegating office for reporting purposes 
within 30 days from negotiation of the contract action.
    (d) Contracting offices outside the United States, its possessions, 
and Puerto Rico are exempt from reporting.
    (e) Designated offices send a quarterly (non-cumulative) report of 
DD Form 1547 data to: Washington Headquarters Service, Directorate for 
Information Operations and Reports (WHS/

[[Page 100]]

DIOR), 1215 Jefferson Davis Highway, suite 1204, Arlington, VA 22202-
4302.
    (f) In preparing/sending the quarterly report, designated offices--
    (1) Perform the necessary audits to ensure information accuracy;
    (2) Do not enter classified information;
    (3) Transmit the report via computer magnetic tape using the 
procedures, format, and editing process issued by the Director of 
Defense Procurement; and
    (4) Send the reports not later than the 30th day after the close of 
the quarterly reporting periods.
    (g) These reporting requirements have been assigned report control 
symbol: P&L(Q) 1751.
[56 FR 36326, July 31, 1991, as amended at 57 FR 53599, Nov. 12, 1992; 
59 FR 27669, May 27, 1994]



Subpart 215.10--Preaward, Award, and Postaward Notifications, Protests, 
                              and Mistakes



215.1001  Notifications to unsuccessful offerors.

    (b) Preaward notices.
    (2) Acquisitions processed under small purchase procedures are 
exempt from the requirements of FAR 15.1001(b)(2).



PART 216--TYPES OF CONTRACTS--Table of Contents




Sec.

                 Subpart 216.1--Selecting Contract Types

216.104  Factors in selecting contract types.
216.104-70  Research and development.

                  Subpart 216.2--Fixed-Price Contracts

216.203  Fixed-price contracts with economic price adjustment.
216.203-4  Contract clauses.
216.203-4  -70  Additional clauses.

               Subpart 216.3--Cost-Reimbursement Contracts

216.301  General.
216.301-3  Limitations.
216.306  Cost-plus-fixed-fee contracts.

                   Subpart 216.4--Incentive Contracts

216.402  Application of predetermined, formula-type incentives.
216.402-2  Technical performance incentives.
216.403  Fixed-price incentive contracts.
216.403-2  Fixed-price incentive (successive targets) contracts.
216.403-70  Fixed-price contracts with award fees.
216.404  Cost-reimbursement incentive contracts.
216.404-1  Cost-plus-incentive-fee contracts.
216.404-2  Cost-plus-award-fee contracts.
216.470  Other applications of award fees.

              Subpart 216.5--Indefinite-Delivery Contracts

216.501  General.
216.505  Contract clauses.
216.506  Ordering.

   Subpart 216.6--Time-and-Materials, Labor-Hour, and Letter Contracts

216.603  Letter contracts.
216.603-3  Limitations.
216.603-4  Contract clauses.

                        Subpart 216.7--Agreements

216.703  Basic ordering agreements.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36340, July 31, 1991, unless otherwise noted.



                 Subpart 216.1--Selecting Contract Types



216.104  Factors in selecting contract types.

    (d) Design stability should also be considered.



216.104-70  Research and development.

    (a) General. There are several categories of research and 
development (R&D) contracts: research, exploratory development, advanced 
development, engineering development, and operational systems 
development (see 235.001 for definitions). Each category has a primary 
technical or functional objective. Different parts of a project may fit 
several categories. The contract type must fit the work required, not 
just the classification of the overall program.
    (b) Research and exploratory development. (1) Price is not 
necessarily the

[[Page 101]]

primary factor in determining the contract type.
    (2) The nature of the work to be performed will usually result in a 
cost-plus award fee, cost-plus fixed fee term, cost-no-fee, or cost-
sharing contract.
    (3) If the Government and the contractor can identify and agree upon 
the level of contractor effort required, the contracting officer may 
select a firm fixed-price level-of-effort contract, except see 235.006.
    (4) If the Government and the contractor agree that an incentive 
arrangement is desirable and capable of being evaluated after completion 
of the work, the contracting officer may use an incentive type contract.
    (c) Advanced development. (1) The nature of the work to be performed 
often results in a cost-plus fixed fee completion type contract.
    (2) Contracting officers may select incentive contracts if--
    (i) Realistic and measurable targets are identified; and
    (ii) Achievement of those targets is predictable with a reasonable 
degree of accuracy.
    (3) Contracting officers should not use contracts with only cost 
incentives where--
    (i) There will be a large number of major technical changes; or
    (ii) Actions beyond the control of the contractor may influence the 
contractor's achievement of cost targets.
    (d) Engineering development and operational systems development. (1) 
When selecting contract types, also consider--
    (i) The degree to which the project is clearly defined, which in 
turn affects the contractor's ability to provide accurate cost 
estimates;
    (ii) The need for effort that will overlap that of earlier stages;
    (iii) The need for firm technical direction by the Government; and
    (iv) The degree of configuration control the Government will 
exercise.
    (2) For development efforts, particularly for major defense systems, 
the preferred contract type is cost reimbursement.
    (3) Contracting officers should use fixed-price type contracts when 
risk has been reduced to the extent that realistic pricing can occur; 
e.g., when a program has reached the final stages of development and 
technical risks are minimal, except see 235.006.



                  Subpart 216.2--Fixed-Price Contracts



216.203  Fixed-price contracts with economic price adjustment.



216.203-4  Contract clauses.

    (a) Adjustment based on established prices-standard supplies. 
Generally, use the clause at FAR 52.216-2, Economic Price Adjustment-
Standard Supplies only when--
    (i) The total contract price is over the small purchase threshold in 
FAR 13.000; and
    (ii) Delivery will not be completed within 6 months after the 
contract date.
    (b) Adjustment based on established prices-semistandard supplies. 
Generally, use the clause at FAR 52.216-3, Economic Price Adjustment-
Semistandard Supplies, only when--
    (i) The total contract price is over the small purchase threshold in 
FAR 13.000; and
    (ii) Delivery will not be completed within 6 months after the 
contract date.
    (c) Adjustments based on actual cost of labor or material.
    (2) Limit use of the clause at FAR 52.216-4, Economic Price 
Adjustment-Labor and Material, to contracts in which the price exceeds 
$50,000 and the period of performance exceeds 6 months, unless otherwise 
approved by the chief of the contracting office. Use an appropriate 
modification of the clause in sealed bidding.
    (4) Apply the full amount of the decrease in the labor rates and 
fringe benefits or unit prices for materials.
    (d) Adjustments based on cost indexes of labor or material. Use the 
following guidelines--
    (i) Do not make the clause unnecessarily complex.
    (ii) Normally, the clause should not provide either a ceiling or a 
floor for adjustment unless adjustment is based on indices below the 
four digit level of the Bureau of Labor Statistics--
    (A) Producer Price Index;

[[Page 102]]

    (B) Employment Cost Index for wages and salaries, benefits, and 
compensation costs for aerospace industries; or
    (C) Wage and Income Series by Standard Industrial Classification 
(Labor).
    (iii) Normally, the clause should cover all potential economic 
fluctuations within the original contract period of performance.
    (iv) The clause must accurately identify the index(es) upon which 
adjustments will be based.
    (A) It must provide for a means to adjust for appropriate economic 
fluctuation in the event publication of the movement of the designated 
index is discontinued. This might include the substitution of another 
index if the time remaining would justify doing so and an appropriate 
index is reasonably available, or some other method for repricing the 
remaining portion of work to be performed.
    (B) Normally, there should be no need to make an adjustment if 
computation of the identified index is altered. However, it may be 
appropriate to provide for adjustment of the economic fluctuation 
computations in the event there is such a substantial alteration in the 
method of computing the index that the original intent of the parties is 
negated.
    (C) When an index to be used is subject to revision (e.g., the 
Bureau of Labor Statistics Producer Price Indexes), the economic price 
adjustment clause must specify that any economic price adjustment will 
be based on a revised index and must identify which revision to the 
index will be used.
    (v) Construct the index to encompass a large sample of relevant 
items while still bearing a logical relationship to the type of contract 
costs being measured. The basis of the index should not be so large and 
diverse that it is significantly affected by fluctuations not relevant 
to contract performance, but it must be broad enough to minimize the 
effect of any single company, including the anticipated contractor(s).
    (vi) Construction of an index is largely dependent upon three 
general series published by the U.S. Department of Labor, Bureau of 
Labor Statistics (BLS). These are the--
    (A) Industrial Commodities portion of the Producer Price Index;
    (B) Employment Cost Index for wages and salaries, benefits, and 
compensation costs for aerospace industries; and
    (C) Wage and Income Series by Standard Industrial Classification 
(Labor). Since there is no BLS published series currently available that 
relates directly to total prices of delivered DoD aircraft, ships, 
missiles, electronics, etc., it will be necessary to construct composite 
indices from major portions of the three series identified.
    (vii) Normally, do not use more than two indices, i.e., one for 
labor (direct and indirect) and one for material (direct and indirect).
    (viii) The clause must establish and properly identify a base period 
comparable to the contract periods for which adjustments are to be made 
as a reference point for application of an index.
    (ix) The clause should not provide for an adjustment beyond the 
original contract performance period, including options. The start date 
for the adjustment may be the beginning of the contract or a later time, 
as appropriate, based on the projected rate of expenditures.
    (x) The expenditure profile for both labor and material should be 
based on a predetermined rate of expenditure (expressed as the 
percentage of material or labor usage as it relates to the total 
contract price) in lieu of actual cost incurred.
    (A) If the clause is to be used in a competitive acquisition, 
determine the labor and material allocations, with regard to both mix of 
labor and material and rate of expenditure by percentage, in a manner 
which will, as nearly as possible, approximate the average expenditure 
profile of all companies to be solicited so that all companies may 
compete on an equal basis.
    (B) If the clause is to be used in a noncompetitive acquisition, the 
labor and material allocations may be subject to negotiation and 
agreement.
    (C) For multiyear contracts, establish predetermined expenditure 
profile tables for each of the annual increments in the multiyear buy. 
Each of the second and subsequent year tables

[[Page 103]]

must be cumulative to reflect the total expenditures for all increments 
funded through the latest multiyear funding.
    (xi) The clause should state the percentage of the contract price 
subject to price adjustment.
    (A) Normally, do not apply adjustments to the profit portion of the 
contract.
    (B) Examine the labor and material portions of the contract to 
exclude any areas that do not require adjustment. For example, it may be 
possible to exclude--
    (1) Subcontracting for short periods of time during the early life 
of the contract which could be covered by firm-fixed-priced 
subcontracting;
    (2) Certain areas of overhead, e.g., depreciation charges, prepaid 
insurance costs, rental costs, leases, certain taxes, and utility 
charges;
    (3) Labor costs for which a definitive union agreement exists; and
    (4) Those costs not likely to be affected by fluctuation in the 
economy.
    (C) Allocate that part of the contract price subject to adjustment 
to specific periods of time (e.g., quarterly, semiannually, etc.) based 
on the most probable expenditure or commitment basis (expenditure 
profile).
    (xii) The clause should provide for definite times or events that 
trigger price adjustments. Adjustments should be frequent enough to 
afford the contractor appropriate economic protection without creating a 
burdensome administrative effort. The adjustment period should normally 
range from quarterly to annually.
    (xiii) When the contract contains cost incentives, any sums paid to 
the contractor on account of economic price adjustment provisions must 
be subtracted from the total of the contractor's allowable costs for the 
purpose of establishing the total costs to which the cost incentive 
provisions apply. If the incentive arrangement is cited in percentage 
ranges, rather than dollar ranges, above and below target costs, 
structure the economic price adjustment clause to maintain the original 
contract incentive range in dollars.
    (xiv) The economic price adjustment clause should provide that once 
the labor and material allocations and the portion of the contract price 
subject to price adjustment have been established, they remain fixed 
through the life of the contract and shall not be modified except in the 
event of significant changes in the scope of the contract. The clause 
should state that pricing actions pursuant to the Changes clause or 
other provisions of the contract will be priced as though there were no 
provisions for economic price adjustment. However, subsequent 
modifications may include a change to the delivery schedule or 
significantly change the amount of, or mix of, labor or material for the 
contract. In such cases, it may be appropriate to prospectively apply 
economic price adjustment coverage. This may be accomplished by--
    (A) Using an economic price adjustment (EPA) clause that applies 
only to the effort covered by the modification;
    (B) Revising the baseline data or period in the EPA clause for the 
basic contract to include the new work; or
    (C) Using an entirely new EPA clause for the entire contract, 
including the new work.
    (xv) Consistent with the factors in paragraphs (d)(i) through (xiv) 
of this subsection, it may also be appropriate to provide in the prime 
contract for similar economic price adjustment arrangements between the 
prime contractor and affected subcontractors to allocate risks properly 
and ensure that those subcontractors are provided similar economic 
protection.
    (xvi) When economic price adjustment clauses are included in 
contracts that do not require submission of cost or pricing data as 
provided for in FAR 15.804-1, the contracting officer must obtain 
adequate information to establish the baseline from which adjustments 
will be made. The contracting officer may require verification of the 
data submitted to the extent necessary to permit reliance upon the data 
as a reasonable baseline.
[56 FR 36340, July 31, 1991, as amended at 62 FR 40472, July 29, 1997]



216.203-4-70  Additional clauses.

    (a) Price adjustment for basic steel, aluminum, brass, bronze, or 
copper mill products.

[[Page 104]]

    (1) The price adjustment clause at 252.216-7000, Economic Price 
Adjustment--Basic Steel, Aluminum, Brass, Bronze, or Copper Mill 
Products, may be used in fixed-price supply contracts for basic steel, 
aluminum, brass, bronze, or copper mill products, such as sheets, 
plates, and bars, when an established catalog or market price exists for 
the particular product being acquired.
    (2) The 10 percent figure in paragraph (d)(1) of the clause shall 
not be exceeded unless approval is obtained at a level above the 
contracting officer.
    (b) Price adjustment for nonstandard steel items. (1) The price 
adjustment clause at 252.216-7001, Economic Price Adjustment--
Nonstandard Steel Items, may be used in fixed-price supply contracts 
when--
    (i) The contractor is a steel producer and actually manufacture the 
standard steel mill item referred to in the ``base steel index'' 
definition of the clause; and
    (ii) The items being acquired are nonstandard steel items made 
wholly or in part of standard steel mill items.
    (2) When this clause is included in invitations for bids, omit Note 
6 of the clause and all references to Note 6.
    (3) Solicitations shall instruct offerors to complete all blanks in 
accordance with the applicable notes.
    (4) When the clause is to provide for adjustment on a basis other 
than ``established price'' (see Note 6 of the clause), that price must 
be verified.
    (5) The ten percent figure in paragraph (e)(4) of the clause shall 
not be exceeded unless approval is obtained at a level above the 
contracting officer.
    (c) Price adjustment for wage rates or material prices controlled by 
a foreign government. (1) The price adjustment clause at 252.216-7003, 
Economic Price Adjustment--Wage Rates or Material Prices Controlled by a 
Foreign Government, may be used in fixed-price supply and service 
contracts when--
    (i) The contract is to be performed wholly or in part in a foreign 
country; and
    (ii) A foreign government controls wage rates or material prices and 
may, during contract performance, impose a mandatory change in wages or 
prices of material.
    (2) Verify the base wage rates and material prices prior to contract 
award and prior to making any adjustment in the contract price.
[56 FR 36340, July 31, 1991, as amended at 62 FR 34122, June 24, 1997; 
62 FR 40472, July 29, 1997]



               Subpart 216.3--Cost-Reimbursement Contracts



216.301  General.



216.301-3  Limitations.

    (c) The contracting officer executes the determination and findings.



216.306  Cost-plus-fixed-fee contracts.

    (c) Limitations.
    (i) Except as provided in paragraph (c)(ii) of this section, annual 
military construction appropriations acts prohibit the use of cost-plus-
fixed-fee contracts that--
    (A) Are funded by a military construction appropriations act;
    (B) Are estimated to exceed $25,000; and
    (C) Will be performed within the United States, except Alaska.
    (ii) The prohibition in paragraph (c)(i) of this section does not 
apply--
    (A) To contracts for environmental restoration at an installation 
that is being closed or realigned where payments are made from a Base 
Realignment and Closure Account; or
    (B) To contracts specifically approved in writing, setting forth the 
reasons therefor, in accordance with the following:
    (1) The Secretaries of the military departments are authorized to 
approve such contracts that are for environmental work only, provided 
the environmental work is not classified as construction, as defined by 
10 U.S.C. 2801.
    (2) The Secretary of Defense or designee must approve such contracts 
that are not for environmental work only or are for environmental work 
classified as construction.
[62 FR 1058, Jan. 8, 1997; 62 FR 1817, Jan. 13, 1997; 62 FR 49305, Sept. 
19, 1997]

[[Page 105]]



                   Subpart 216.4--Incentive Contracts



216.402  Application of predetermined, formula-type incentives.



216.402-2  Technical performance incentives.

    Contractor performance incentives should relate to specific 
performance areas of milestones, such as delivery or test schedules, 
quality controls, maintenance requirements, and reliability standards.



216.403  Fixed-price incentive contracts.

    (b) Application.
    (3) Individual line items may have separate incentive provisions; 
e.g., when dissimilar work calls for separate formulas.



216.403-2  Fixed-price incentive (successive targets) contracts.

    (a) Description. (1)(iii) The formula does not apply for the life of 
the contract. It is used to fix the firm target profit for the contract. 
To provide an incentive consistent with the circumstances, the formula 
should reflect the relative risk involved in establishing an incentive 
arrangement where cost and pricing information were not sufficient to 
permit the negotiation of firm targets at the outset.



216.403-70  Fixed-price contracts with award fees.

    Award fee provisions may be used in fixed price contracts as 
provided in 216.470.



216.404  Cost-reimbursement incentive contracts.



216.404-1  Cost-plus-incentive-fee contracts.

    (b) Application.
    (3) Give appropriate weight to basic acquisition objectives in 
negotiating the range of fee and the fee adjustment formula. For 
example--
    (A) In an initial product development contract, it may be 
appropriate to provide for relatively small adjustments in fee tied to 
the cost incentive feature, but provide for significant adjustments if 
the contractor meets or surpasses performance targets.
    (B) In subsequent development and test contracts, it may be 
appropriate to negotiate an incentive formula tied primarily to the 
contractor's success in controlling costs.



216.404-2  Cost-plus-award-fee contracts.

    (a) Description. (i) Normally, award fee is not earned when the fee-
determining official has determined that contractor performance has been 
submarginal or unsatisfactory.
    (ii) The basis for all award fee determinations shall be documented 
in the contract file.
    (b) Application. (1) The cost-plus-award-fee (CPAF) contract is also 
suitable for level of effort contracts where mission feasibility is 
established but measurement of achievement must be by subjective 
evaluation rather than objective measurement. See Table 16-1, 
Performance Evaluation Criteria, for sample performance evaluation 
criteria and Table 16-2, Contractor Performance Evaluation Report, for a 
sample evaluation report.
    (2) The contracting activity may--
    (A) Establish a board to--
    (1) Evaluate the contractor's performance; and
    (2) Determine the amount of the award or recommend an amount to the 
contracting officer.
    (B) Afford the contractor an opportunity to present information on 
its own behalf.
    (c) Limitations. The CPAF contract shall not be used--
    (i) To avoid--
    (A) Establishing CPFF contracts when the criteria for CPFF contracts 
apply, or
    (B) Developing objective targets so a CPIF contract can be used.
    (ii) For either engineering development or operational system 
development acquisitions which have specifications suitable for 
simultaneous research and development and production, except a CPAF 
contract may be used for individual engineering development or 
operational system development acquisitions ancillary to the development 
of a major weapon system or equipment, where--
    (A) It is more advantageous; and

[[Page 106]]

    (B) The purpose of the acquisition is clearly to determine or solve 
specific problems associated with the major weapon system or equipment.
    (2)(A) Do not apply the weighted guidelines method to CPAF contracts 
for either the base (fixed) fee or the award fee.
    (B) The base fee shall not exceed three percent of the estimated 
cost of the contract exclusive of the fee.



216.470  Other applications of award fees.

    The ``award amount'' portion of the fee may be used in other types 
of contracts under the following conditions--
    (1) The Government wishes to motivate and reward a contractor for 
management performance in areas which cannot be measured objectively and 
where normal incentive provisions cannot be used. For example, logistics 
support, quality, timeliness, ingenuity, and cost effectiveness are 
areas under the control of management which may be susceptible only to 
subjective measurement and evaluation.
    (2) The ``base fee'' (fixed amount portion) is not used.
    (3) The chief of the contracting office approves the use of the 
``award amount.''
    (4) An award review board and procedures are established for conduct 
of the evaluation.
    (5) The administrative costs of evaluation do not exceed the 
expected benefits.

                                                       Table 16-1--Performance Evaluation Criteria                                                      
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          Submarginal          Marginal              Good              Very good           Excellent    
--------------------------------------------------------------------------------------------------------------------------------------------------------
A--Time of Delivery.............  (A-1) Adherence to  Consistently late   Late on 10% plans   Occasional plan     Meets plan          Delivers all plans
                                   plan schedule.      on 20% of plans.    w/o prior           late w/o            schedule.           on schedule .    
                                                                           agreement.          justification.                          meets prod.      
                                                                                                                                       change           
                                                                                                                                       requirements on  
                                                                                                                                       schedule.        
                                  (A-2) Action on     Does not expose     Exposes changes     Anticipates         Keeps Yard posted   Anticipates in    
                                   Anticipated         changes or          but is dilatory     changes, advise     on delays,          good time,       
                                   delays.             resolve them as     in resolution on    Shipyard but        resolves            advises Shipyard,
                                                       soon as             plans.              misses completion   independently on    resolves         
                                                       recognized.                             of design plans     plans.              independently and
                                                                                               10%.                                    meets production 
                                                                                                                                       schedule.        
                                  (A-3) Plan          Does not complete   System studies      Major work plans    Design changes      Design changes,   
                                   Maintenance.        interrelated        completed but       coordinated in      from studies and    studies resolved 
                                                       systems studies     constr. plan        time to meet        interrelated        and test data    
                                                       concurrently.       changes delayed.    production          plans issued in     issued ahead of  
                                                                                               schedules.          time to meet        production       
                                                                                                                   product schedules.  requirements.    
B--Quality of Work..............  (B-1) Work          25% dwgs. not       20% not compatible  10% not compatible  0% dwgs. prepared   0% dwgs. presented
                                   Appearance.         compatible with     with Shipyard       with Shipyard       by Des. agent not   incl. Des. agent,
                                                       Shipyard repro.     repro. processes    repro. processes    compatible with     vendors,         
                                                       processes and use.  and use.            and use.            Shipyard repro.     subcontr. not    
                                                                                                                   processes and use.  compatible with  
                                                                                                                                       Shipyard repro.  
                                                                                                                                       processes and    
                                                                                                                                       use.             
                                  (B-2) Thoroughness  Is brief on plans   Has followed        Has followed        Work complete with  Work of highest   
                                   and Accuracy of     tending to leave    guidance, type      guidance, type      notes and           caliber          
                                   Work.               questionable        and standard dwgs.  and standard        thorough            incorporating all
                                                       situations for                          dwgs. questioning   explanations for    pertinent data   
                                                       Shipyard to                             and resolving       anticipated         required         
                                                       resolve.                                doubtful areas.     questionable        including related
                                                                                                                   areas.              activities.      

[[Page 107]]

                                                                                                                                                        
                                  (B-3) Engineering   Tendency to follow  Adequate engrg. to  Engineered to       Displays excellent  Exceptional       
                                   Competence.         past practice       use & adapt         satisfy specs.,     knowledge of        knowledge of     
                                                       with no variation   existing designs    guidance plans      constr. reqmts.     Naval shipwork & 
                                                       to meet reqmts.     to suit job on      and material        considering         adaptability to  
                                                       job in hand.        hand for routine    provided.           systems aspect,     work process     
                                                                           work.                                   cost, shop          incorporating    
                                                                                                                   capabilities and    knowledge of     
                                                                                                                   procurement         future planning  
                                                                                                                   problems.           in Design.       
                                  (B-4) Liaison       Indifferent to      Satisfactory but    Maintains normal    Maintains           Maintains expert  
                                   Effectiveness.      requirements of     dependent on        contact with        independent         contact, keeping 
                                                       associated          Shipyard to force   associated          contact with all    Yard informed,   
                                                       activities,         resolution of       activities          associated          obtaining info   
                                                       related systems,    problems without    depending on        activities,         from equip.,     
                                                       and Shipyard        constructive        Shipyard for        keeping them        supplies   w/o   
                                                       advice.             recommendations     problems            informed to         prompting by     
                                                                           to subcontr. or     requiring           produce             Shipyard.        
                                                                           vendors.            military            compatible design                    
                                                                                               resolution.         with little                          
                                                                                                                   assistance for                       
                                                                                                                   Yard.                                
                                  (B-5) Independence  Constant            Requires            Normal interest     Complete &          Develops complete 
                                   and Initiative.     surveillance        occasional          and desire to       accurate job.       and accurate     
                                                       req'd to keep job   prodding to stay    provide workable    Free of             plans, seeks out 
                                                       from slipping--     on schedule &       plans with          incompatibilities   problem areas and
                                                       assign to low       expects Shipyard    average             with little or no   resolves with    
                                                       priority to         resolution of       assistance &        direction by        assoc. act. ahead
                                                       satisfy needs.      most problems.      direction by        Shipyard.           of schedule.     
                                                                                               Shipyard.                                                
C--Effectiveness in Controlling   (C-1) Utilization   Planning of work    Supervision sets .  System planning by  Design parameters   Mods. to design   
 and/or Reducing Costs.            of Personnel.       left to designers   reviews goals for   supervisory,        established by      plans limited to 
                                                       on drafting         designers.          personnel,          system engineers    less than 5% as  
                                                       boards.                                 studies checked     . held in design    result lack      
                                                                                               by engineers.       plans.              engrg. system    
                                                                                                                                       correlation.     
                                  (C-2) Control       Expenditures not    Expenditures        Direct charges set  Provides services   No cost overruns  
                                   Direct Charges      controlled for      reviewed            & accounted for     as part of normal   on original      
                                   (Except Labor).     services.           occasionally by     on each work        design function     estimates absorbs
                                                                           supervision.        package.            w/o extra charges.  service demands  
                                                                                                                                       by Shipyard.     
                                  (C-3) Performance   Does not meet cost  Does not meet cost  Exceeds original    Exceeds original    Never exceeds     
                                   to Cost Estimate.   estimate for        estimate for        est. on change      est. on change      estimates of     
                                                       original work or    original work or    orders 10% time     orders 5% time.     original package 
                                                       changes 30% time.   changes 20% time.   and meets                               or change orders.
                                                                                               original design                                          
                                                                                               costs.                                                   

[[Page 108]]

                                                                                                                                                        
--------------------------------------------------------------------------------------------------------------------------------------------------------


                                                  Table 16-2.--Contractor Performance Evaluation Report                                                 
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                      Category                          
     Category                Criteria                  Rating             Item factor       Evaluation rating          factor         Efficiency rating 
--------------------------------------------------------------------------------------------------------------------------------------------------------
A                  TIME OF DELIVERY...........                                                                                                          
                   A-1 Adherence to Plan               ______          x          .40   =         ______                                                
                    Schedule.                                                                                                                           
                   A-2 Action on Anticipated           ______          x          .30   =         ______                                                
                    Delays.                                                                                                                             
                   A-3 Plan Maintenance.......         ______          x          .30   =         ______                                                
                                                                                                                                                        
                       Total Item Weighed       ....................  ..  ...........  ..         ______         x          .30   =         ______      
                    Rating.                                                                                                                             
B                  QUALITY OF WORK............                                                                                                          
                   B-1 Work Appearance........         ______          x          .15   =         ______                                                
                                                                                                                                                        
                   B-2 Thoroughness and                ______          x          .30   =         ______                                                
                    Accuracy of Work.                                                                                                                   
                   B-3 Engineering Competence.         ______          x          .20   =         ______                                                
                                                                                                                                                        
                   B-4 Liaison Effectiveness..         ______          x          .15   =         ______                                                
                                                                                                                                                        
                   B-5 Independence and                ______          x          .20   =         ______                                                
                    Initiative.                                                                                                                         
                       Total Item Weighed       ....................  ..  ...........  ..         ______         x          .40   =         ______      
                    Rating.                                                                                                                             
C                  EFFECTIVENESS IN                                                                                                                     
                    CONTROLLING AND/OR                                                                                                                  
                    REDUCING COSTS.                                                                                                                     
                   C-1 Utilization of                  ______          x          .30   =         ______                                                
                    Personnel.                                                                                                                          
                   C-2 Control of all Direct           ______          x          .30   =         ______                                                
                    Charges Other than Labor.                                                                                                           
                   C-3 Performance to Cost             ______          x          .40   =         ______                                                
                    Estimate.                                                                                                                           
                       Total Item Weighed       ....................  ..  ...........  ..         ______         x          .30   =         ______      
                    Rating.                                                                                                                             
TOTAL WEIGHED RATING:                                                                                                                                   
Rated by:                                                                                                                                               
Signature(s):--s0                                                                                                                                       
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ratings--Excellent; Very good; Good; Marginal; Submarginal;                                                                                             
Period of        19                                                                                                                                     
Contract Number                                                                                                                                         
Contractor                                                                                                                                              
Date of Report                                                                                                                                          
PNS Techical Monitor/s                                                                                                                                  
Note: Provide supporting data and/or justification for below average or outstanding item ratings.                                                       


[[Page 109]]



              Subpart 216.5--Indefinite-Delivery Contracts



216.501  General.

    (a)(i) For items with a shelf-life of less than 6 months, consider 
the use of indefinite delivery type contracts with orders to be placed 
either--
    (A) Directly by the users; or
    (B) By central purchasing offices with deliveries direct to users.
    (ii) Whenever an indefinite delivery contract is issued, the issuing 
office must furnish all ordering offices sufficient information for the 
ordering office to complete its contract reporting responsibilities 
under 204.670-2. This data must be furnished to the ordering activity in 
sufficient time for the activity to prepare its report for the action 
within 3 working days of the order.
[56 FR 36340, July 31, 1991, as amended at 57 FR 42630, Sept. 15, 1992]



216.505  Contract clauses.

    (d) If the contract is for the preparation of personal property for 
shipment or storage (see 247.271-4), substitute paragraph (f) at 
252.247-7015, Requirements, for paragraph (f) of the clause at FAR 
52.216-21, Requirements.



216.506  Ordering.

    Orders placed under indefinite delivery contracts may be issued on 
DD Form 1155, Order for Supplies or Services.



   Subpart 216.6--Time-And-Materials, Labor-Hour, and Letter Contracts



216.603  Letter contracts.



216.603-3  Limitations.

    See subpart 217.74 for additional limitations on the use of letter 
contracts.



216.603-4  Contract clauses.

    (b)(2) See 217.7406(a) for additional guidance regarding use of the 
clause at FAR 52.216-24, Limitation of Government Liability.
    (3) Use the clause at 252.217-7027, Contract Definitization, in 
accordance with its prescription at 217.7406(b), instead of the clause 
at FAR 52.216-25, Contract Definitization.
[61 FR 7743, Feb. 29, 1996]



                        Subpart 216.7--Agreements



216.703  Basic ordering agreements.

    (c) Limitations. The period during which orders may be placed 
against a basic ordering agreement may not exceed three years. The 
contracting officer, with the approval of the chief of the contracting 
office, may grant extensions for up to two years. No single extension 
shall exceed one year. See subpart 217.74 for additional limitations on 
the use of undefinitized orders under basic ordering agreements.
    (d) Orders. (i) The contracting officer issuing an order under a 
basic ordering agreement shall be responsible for ensuring compliance 
with the provisions and limitations of this section.
    (ii) Individual orders under a basic ordering agreement shall be 
individually closed following completion of the orders (see FAR 4.804).
    (1)(iii) The office issuing the agreement shall furnish all 
authorized ordering offices sufficient information for the ordering 
office to complete its contract reporting responsibilities under 
204.670-2 or, in the case of civilian agencies, the Federal Procurement 
Data System reporting requirement. Data furnished to civilian agencies 
must contain uncoded information about the data elements and the 
meanings of the codes to permit these users to translate the data into 
the federal format. This data must be furnished to the ordering activity 
in sufficient time for the activity to prepare its report for the action 
within 3 working days of the order.
    (2)(i) Any activity listed in the agreement may issue orders on DD 
Form 1155, Order for Supplies or Services, or Standard Form 26, Award/
Contract.
    (3) Incentive provisions consistent with this part are permitted.
[56 FR 36340, July 31, 1991, as amended at 61 FR 7743, Feb. 29, 1996; 61 
FR 18195, Apr. 24, 1996]

[[Page 110]]



PART 217--SPECIAL CONTRACTING METHODS--Table of Contents




Sec.

                  Subpart 217.1--Multiyear Contracting

217.102  Policy.
217.102-2  General.
217.102-3  Objectives.
217.103  Procedures.
217.103-1  General.

                         Subpart 217.2--Options

217.202  Use of options.
217.208  Solicitation provisions and contract clauses.
217.208-70  Additional clauses.

                Subpart 217.4--Leader Company Contracting

217.401  General.

      Subpart 217.5--Interagency Acquisitions Under the Economy Act

217.500  Scope of subpart.
217.502  General.
217.504  Ordering procedures.

            Subpart 217.6--Management and Operating Contracts

217.600  Scope of subpart.

              Subpart 217.70--Exchange of Personal Property

217.7000  Scope of subpart.
217.7001  Definitions.
217.7002  Policy.
217.7003  Purchase request.
217.7004  Solicitation and award.
217.7005  Solicitation provision.

  Subpart 217.71--Master Agreement for Repair and Alteration of Vessels

217.7100  Scope of subpart.
217.7101  Definitions.
217.7102  General.
217.7103  Procedures.
217.7103-1  Content and format.
217.7103-2  Period of agreement.
217.7103-3  Solicitations for job orders.
217.7103-4  Award of a job order.
217.7103-5  Emergency work.
217.7103-6  Repair costs not readily ascertainable.
217.7103-7  Modification of master agreements.
217.7104  Contract clauses.

                Subpart 217.72--Bakery and Dairy Products

217.7200  Scope.
217.7201  Contract requirements for dairy products.
217.7202  Contract type.
217.7203  Contract clauses.

           Subpart 217.73--Identification of Sources of Supply

217.7300  Scope.
217.7301  Policy.
217.7302  Procedures.
217.7303  Solicitation provision.

             Subpart 217.74--Undefinitized Contract Actions

217.7400  Scope.
217.7401  Definitions.
217.7402  Exceptions.
217.7403  Policy.
217.7404  Limitations.
217.7404-1  Authorization.
217.7404-2  Price ceiling.
217.7404-3  Definitization schedule.
217.7404-4  Limitations on obligations.
217.7404-5  Exceptions.
217.7404-6  Allowable profit.
217.7405  Definitizations.
217.7406  Contract clauses.

           Subpart 217.75--Acquisition of Replenishment Parts

217.7500  Scope of subpart.
217.7501  General.
217.7502  Spares acquisition integrated with production (SAIP).
217.7503  Acquisition of parts when data is not available.
217.7504  Limitations on price increases.

        Subpart 217.76--Contracts with Provisioning Requirements

217.7600  Scope of subpart.
217.7601  Definitions.
217.7602  Contracting requirements.
217.7602-1  Contractual provisions.
217.7602-2  Issuance of provisioned items orders.
217.7603  Contract administration requirements.
217.7603-1  Provisioning conferences.
217.7603-2  Contract administration office monitoring.
217.7603-3  Negotiating and executing supplemental agreements.

                   Subpart 217.77--Over and Above Work

217.7700  Scope of subpart.
217.7701  Procedures.
217.7702  Contract clause.


[[Page 111]]



    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36345, July 31, 1991, unless otherwise noted.



                  Subpart 217.1--Multiyear Contracting



217.102  Policy.



217.102-2  General.

    (b) The applicable program year is that shown in the DoD Future 
Years Defense Program.



217.102-3  Objectives.

    (d)(3) For additional restrictions on inclusion of recurring costs 
in the cancellation ceiling in DoD multiyear contracts, see 217.103-
1(a)(iii) and the DoD Budget Guidance Manual (DoD 7110.1-M).
[57 FR 53599, Nov. 12, 1992]



217.103  Procedures.



217.103-1  General.

    (a) Criteria. 10 U.S.C. 2306(h) and annual DoD authorization and 
appropriations acts have established the following additional criteria:
    (i) The use of such a contract will promote the national security of 
the United States (10 U.S.C. 2306(h)(1)).
    (ii) The contract provides for a production rate at not less than 
minimum economic production rates given the existing tooling and 
facilities (10 U.S.C. 2306(h)(9));
    (iii) Any advance economic order quantity acquisition (see FAR 
17.101) is funded at least to the limits of the Government's liability. 
Recurring costs for such economic order quantities shall not be included 
in the unfunded cancellation ceiling. (Section 9021, Pub. L. 101-165 and 
similar sections in subsequent Defense appropriations acts).
    (b) Limitations.
    (i) Public Law 90-378 (10 U.S.C. 2306(g)).
    (A) DoD may enter into multiyear acquisitions for the following 
services (and items of supply relating to such services), even though 
funds are limited by statute to obligation during the fiscal year in 
which the contract is executed:
    (1) Operation, maintenance, and support of facilities and 
installations;
    (2) Maintenance or modification of aircraft, ships, vehicles, and 
other highly complex military equipment;
    (3) Specialized training requiring high quality instructor skills 
(e.g., training for pilots and other aircrew members or foreign language 
training); and
    (4) Base services (e.g., ground maintenance, in-plane refueling, bus 
transportation, and refuse collection and disposal).
    (B) This authority may be used as long as the contract--
    (1) Does not extend beyond five years;
    (2) Complies with FAR 17.101 through 17.105; and
    (3) Performance years do not extend beyond the end of any fiscal 
year.
    (ii) Public Law 97-214 (10 U.S.C. 2829).
    (A) DoD may enter into multiyear contracts for supplies and services 
required for management, maintenance, and operation of military family 
housing and may pay the costs of such contracts for each year out of 
annual appropriations for that year.
    (B) This authority may be used as long as the contract--
    (1) Does not extend beyond four years;
    (2) Complies with FAR 17.101 through 17.105; and
    (3) Performance years do not extend beyond the end of any fiscal 
year.
    (iii) Award of a multiyear contract for services requires a written 
determination by the head of the contracting activity (10 U.S.C. 
2306(g)(1)) that--
    (A) There will be a continuing need for the services and incidental 
supplies;
    (B) Furnishing the services and incidental supplies will require--
    (1) A substantial initial investment in plant or equipment;
    (2) The upfront commitment of substantial financial resources for 
the assembly, training or transportation of a specialized work force; or
    (3) Other substantial startup costs; and
    (C) Using a multiyear contract will be in the best interest of the 
United States by encouraging effective competition and promoting 
economical business operations.

[[Page 112]]

    (iv) The appropriate Secretary must provide a 30-day advance 
notification to the Committees on Appropriations and Armed Services of 
the House of Representatives and the Senate before the award of any--
    (A) Multiyear contract that contains a cancellation ceiling in 
excess of $100 million (10 U.S.C. 2306(h)(3));
    (B) Multiyear contract that provides for economic order quantity 
purchases in excess of $20 million in any year (Section 9021, Pub. L. 
101-165 and similar sections in subsequent appropriations acts);
    (C) Multiyear contract that includes an unfunded contingent 
liability in excess of $20 million (Section 9021, Pub. L. 101-165 and 
similar sections in subsequent appropriations acts); or
    (D) Contract for advance procurement leading to a multiyear contract 
with an economic order quantity procurement in excess of $20 million in 
any year (Section 9021, Pub. L. 101-165 and similar sections in 
subsequent appropriations acts).
    (v) Departments/agencies shall establish reporting procedures to 
meet the requirements of paragraph (b)(iv) of this subsection. Submit 
copies of the notifications to the Under Secretary of Defense 
(Acquisition & Technology), Director of Defense Procurement (USD(A&T)DP) 
and the Under Secretary of Defense (Comptroller) (Program/Budget) 
(USD(C)(P/B)).
    (vi) Do not initiate a multiyear contract--
    (A) In excess of $500 million for any system or component thereof 
unless--
    (1) Specifically provided for in a Defense appropriations act 
(section 9021, Pub. L. 101-165 and similar sections in subsequent 
appropriations acts); and
    (2) The Secretary of Defense certifies to Congress that the current 
Future Years Defense Program fully funds the support costs associated 
with the multiyear program. Forward documentation to support this 
certification to the Under Secretary of Defense (Acquisition & 
Technology), Director of Defense Procurement.
    (B) Without using present value analysis to determine the lowest 
cost to the Government of a multiyear contract compared to annual 
contracts (Section 9021, Pub. L. 101-165 and similar sections in 
subsequent appropriations acts).
    (vii) Do not terminate a multiyear contract under a program approved 
by Congress without providing a ten-day advance notification to the 
Committees on Appropriations and Armed Services of the House of 
Representatives and the Senate (Section 9021, Pub. L. 101-165 and 
similar sections in subsequent appropriations acts).
    (viii) The Secretary of Defense may ask Congress for relief from any 
conditions established by law for that particular procurement program 
(10 U.S.C. 2306(h)(11)).
    (A) A request for relief from the requirement to achieve specific 
cost savings may be made if it appears, after negotiations with the 
contractors, that such savings cannot be achieved, but that substantial 
savings could nevertheless be achieved by using a multiyear contract.
    (B) Include in such request details concerning the reasons for 
requesting use of a multiyear contract as well as details about the 
negotiated contract terms and conditions.
    (C) Forward supporting documentation to the Under Secretary of 
Defense (Acquisition & Technology), Director of Defense Procurement.
    (ix) Departments/agencies also must comply with any other 
restrictions or notification requirements contained in annual 
authorization or appropriation acts.
    (d) Cancellation. State cancellation ceilings in the schedule as a 
not-to-exceed amount.
[56 FR 36345, July 31, 1991, as amended at 57 FR 14992, Apr. 23, 1992; 
58 FR 28465, May 13, 1993; 60 FR 61596, Nov. 30, 1995]



                         Subpart 217.2--Options



217.202  Use of options.

    (1) Options may be used for foreign military sales requirements.
    (2) Consider use of surge options to support the Industrial 
Preparedness Production Planning program (see subpart 208.72). A surge 
option allows the Government, prior to final delivery, to--
    (i) Accelerate the contractor's production rate in accordance with a 
surge production plan or a delivery schedule

[[Page 113]]

provided by the contractor under the terms of the contract; and
    (ii) Purchase additional quantities of supplies or services.
    (3) See subpart 217.74 for limitations on the use of undefinitized 
options.
[56 FR 36345, July 31, 1991, as amended at 61 FR 7743, Feb. 29, 1996]



217.208  Solicitation provisions and contract clauses.

    Sealed bid solicitations shall not include provisions for 
evaluations of options unless the contracting officer determines that 
there is a reasonable likelihood that the options will be exercised (10 
U.S.C. 2301(a)(7)). This limitation also applies to sealed bid 
solicitations for the contracts excluded by FAR 17.200.



217.208-70  Additional clauses.

    (a) Use the clause at 252.217-7000, Exercise of Option to Fulfill 
Foreign Military Sales Commitments, when an option may be used for 
foreign military sale requirements.
    (1) Use Alternate I when the foreign military sale country is not 
known at the time of solicitation or award.
    (2) Do not use this clause in contracts for establishment or 
replenishment of DoD inventories or stocks, or acquisitions made under 
DoD cooperative logistics support arrangements.
    (b) When a surge option is needed in support of industrial 
preparedness production planning (see subpart 208.72), use the clause at 
252.217-7001, Surge Option, in solicitations and contracts.
    (1) Insert the percentage of increase the option represents in 
paragraph (a) of the clause.
    (2) Change 30 days in paragraphs (b)(2) and (d)(1) to longer 
periods, if appropriate.
    (3) Change the 24-month period in paragraph (c)(3), if appropriate.



                Subpart 217.4--Leader Company Contracting



217.401  General.

    When leader company contracting is to be considered, take special 
effort to select a small disadvantaged business (SDB) concern as the 
follower company. Where other than an SDB is selected as the follower 
company, the contracting officer shall document the contract file to 
reflect--
    (1) The extent of actions taken to identify SDB concerns for 
participation in the acquisition; and
    (2) The rationale for selection of a non-SDB as the follower 
company.



      Subpart 217.5--Interagency Acquisitions Under the Economy Act



217.500  Scope of subpart.

    Acquisitions from required sources, as described in FAR part 8, are 
not orders under the Economy Act.
[59 FR 22760, May 3, 1994]



217.502  General.

    If requested, the contracting officer who normally would contract 
for the requesting activity should advise in the determination process.
[59 FR 22760, May 3, 1994]



217.504  Ordering procedures.

    (b) Do not send invitations for bids or requests for proposals to 
other Government agencies.



            Subpart 217.6--Management and Operating Contracts



217.600  Scope of subpart.

    FAR subpart 17.6 does not apply to DoD.



              Subpart 217.70--Exchange of Personal Property



217.7000  Scope of subpart.

    This subpart prescribes policy and procedures for exchange of 
nonexcess personal property concurrent with an acquisition. Section 
201(c) of the Federal Property and Administrative Services Act of 1949, 
63 Stat. 384, as amended (40 U.S.C. 481(c)) permits exchange of personal 
property and application of the exchange allowance to the acquisition of 
similar property. This subpart does not authorize the sale of nonexcess 
personal property.



217.7001  Definitions.

    As used in this subpart,

[[Page 114]]

    (a) Exchange (trade-in) property means property which--
    (1) Is not excess but is eligible for replacement (because of 
obsolescence, unserviceability, or other reason); and
    (2) Is applied as whole or partial payment toward the acquisition of 
similar items (i.e., items designed and constructed for the same 
purpose).
    (b) Property means items which fall within one of the generic 
categories listed in DoDI 4140.51, Exchange of Nonexcess Personal 
Property in the Department of Defense.



217.7002  Policy.

    DoD policy is to exchange, rather than replace, eligible nonexcess 
property whenever exchange promotes economical and efficient program 
accomplishment. Exchange policy, authority, and applicability are 
governed by--
    (a) The Federal Property Management Regulations issued by the 
Administrator of the General Services Administration; and
    (b) DoDI 4140.51, Exchange of Nonexcess Personal Property in the 
Department of Defense.



217.7003  Purchase request.

    Ensure that the requiring activity provides all of the following in 
support of the purchase request--
    (a) A certification that the property is eligible for exchange and 
complies with all conditions and limitations of DoDI 4140.51;
    (b) A written determination of economic advantage indicating--
    (1) The anticipated economic advantage to the Government from use of 
the exchange authority;
    (2) That exchange allowances shall be applied toward, or in partial 
payment of, the items to be acquired; and
    (3) That, if required, the exchange property has been rendered safe 
or innocuous or has been demilitarized;
    (c) All applicable approvals for the exchange; and
    (d) A description of the property available for exchange (e.g., 
nomenclature, location, serial number, estimated travel value).



217.7004  Solicitation and award.

    (a) Solicitations shall include a request for offerors to state 
prices--
    (1) For the new items being acquired without any exchange; and
    (2) For the new items with the exchange (trade-in allowance) for the 
exchange property listed.
    (b) The contracting officer is not obligated to award on an exchange 
basis. If the lowest evaluated offer is an offer for the new items 
without any exchange, the contracting officer may award on that basis 
and forgo the exchange.
    (c) Exchanges may be made only with the successful offeror. When the 
successful offer includes an exchange, award one contract for both the 
acquisition of the new property and the trade-in of the exchange 
property. The only exception is when the items must be acquired against 
a mandatory Federal supply schedule contract, in which case, award a 
separate contract for the exchange.



217.7005  Solicitation provision.

    Use the provision at 252.217-7002, Offering Property for Exchange, 
when offering nonexcess personal property for exchange. Allow a minimum 
of 14 calendar days for the inspection period in paragraph (b) of the 
clause if the exchange property is in the continental United States. 
Allow at least 21 calendar days outside the United States.



  Subpart 217.71--Master Agreement for Repair and Alteration of Vessels



217.7100  Scope of subpart.

    This subpart contains acquisition policies and procedures for master 
agreements for repair and alteration of vessels.



217.7101  Definitions.

    (a) Master agreement for repair and alteration of vessels--
    (1) Is a written instrument of understanding, negotiated between a 
contracting activity and a contractor that--
    (A) Contains contract clauses, terms, and conditions applying to 
future contracts for repairs, alterations, and/or additions to vessels; 
and

[[Page 115]]

    (B) Contemplates separate future contracts that will incorporate by 
reference or attachment the required and applicable clauses agreed upon 
in the master agreement.
    (2) Is not a contract.
    (b) Job order--
    (1) Is a fixed price contract incorporating, by reference or 
attachment, a master agreement for repair and alteration of vessels;
    (2) May include clauses pertaining to subjects not covered by the 
master agreement; but applicable to the job order being awarded; and
    (3) Applies to a specific acquisition and sets forth the scope of 
work, price, delivery date, and other appropriate terms that apply to 
the particular job order.



217.7102  General.

    (a) Activities shall enter into master agreements for repair and 
alteration of vessels with all prospective contractors located within 
the United States, its possessions, or Puerto Rico, which--
    (1) Request ship repair work; and
    (2) Which possess the organization and facilities to perform the 
work satisfactorily. (Issuance of a master agreement does not indicate 
approval of the contractor's facility for any particular acquisition and 
is not an affirmative determination of responsibility under FAR subpart 
9.1 for any particular acquisition.)
    (b) Activities may use master agreements in work with prospective 
contractors located outside the United States, its possessions, or 
Puerto Rico.
    (c) Activities may issue job orders under master agreements to 
effect repairs, alterations, and/or additions to vessels belonging to 
foreign governments.
    (1) Contractors shall treat vessels of a foreign government as if 
they were vessels of the U.S. Government whenever requested to do so by 
the contracting officer.
    (2) Identify the vessel and the foreign government in the 
solicitation and job order.



217.7103  Procedures.



217.7103-1  Content and format.

    (a) A Master agreement shall contain all clauses required by 
217.7104(a), statute and executive order.
    (b) The following format may be adapted to fit specific 
circumstances:

          Master Agreement for Repair and Alteration of Vessels

    (1) This agreement is entered into this ______ day of __________ 
19____, by the United States of America (the ``Government'':) 
represented by ____________, the Contracting Officer, and, ____________ 
a corporation organized and existing under the laws of the State of 
____________ (the ``Contractor'').
    (2) The clauses in this agreement, shall be incorporated, by 
reference or attachment, in job orders issued under this agreement to 
effect repairs, alterations, and/or additions to vessels.
    (3) By giving 30 days written notice, either party to this agreement 
has the right to cancel it without affecting the rights and liabilities 
under any job order existing at the time of cancellation. The Contractor 
shall perform, under the terms of this agreement, all work covered by 
any job order awarded before the effective date of the cancellation.
    (4) This agreement may be modified only by mutual agreement of the 
parties. A modification of this agreement shall not affect any job order 
in existence at the time of modification, unless the parties agree 
otherwise.
    (5) The rights and obligations of the parties to this agreement are 
set forth in this agreement and the clauses of any job orders issued 
under this agreement. In the event there is an inconsistency between 
this agreement and any job order, the provisions of this agreement shall 
govern.
    (6) This agreement shall remain in effect until canceled by either 
party.

THE UNITED STATES OF AMERICA
 by_____________________________________________________________________
(Contracting Officer)
 _______________________________________________________________________
(Contractor)
 by_____________________________________________________________________
(Authorized Individual)
 _______________________________________________________________________
(Title)



217.7103-2  Period of agreement.

    (a) Master agreements remain in effect until canceled by either the 
contractor or the contracting officer.
    (b) Master agreements can be canceled by either the contractor or 
the

[[Page 116]]

contracting officer by giving 30 days written notice to the other.
    (c) Cancellation of a master agreement does not affect the rights 
and liabilities under any job order existing at the time of 
cancellation. The contractor must continue to perform all work covered 
by any job order issued before the effective date of cancellation of the 
master agreement.



217.7103-3  Solicitations for job orders.

    (a) When a requirement arises within the United States, its 
possessions, or Puerto Rico for the type of work covered by the master 
agreement, solicit offers from prospective contractors that--
    (1) Previously executed a master agreement; or
    (2) Have not previously executed a master agreement, but possess the 
necessary qualifications to perform the work and agree to execute a 
master agreement before award of a job order.
    (b) Prepare the solicitation in the uniform contract format and in 
accordance with FAR subparts 14.2 or 15.4, as applicable.
    (c) Include in the solicitation--
    (1) The nature of the work to be performed;
    (2) The date the vessel will be available to the contractor;
    (3) The date the work is to be completed; and
    (4) Whether bulk ammunition is aboard the vessel.
    (d) Unless the solicitation states otherwise, offers are to be based 
on performance at the contractor's site.
    (e) Solicitations processed under negotiated acquisition procedures 
shall require offerors to include a breakdown of the price with 
reasonable supporting detail in whatever format and detail the 
contracting officer may request.
    (f) Where practicable, afford potential offerors an opportunity to 
inspect the item needing repair or alteration.



217.7103-4  Award of a job order.

    Award job orders in accordance with FAR subparts 14.4 or 15.10.



217.7103-5  Emergency work.

    (a) The contracting officer, without soliciting offers, may issue a 
written job order to a contractor that has previously executed a master 
agreement when--
    (i) Delay in the performance of necessary repair work would endanger 
a vessel, its cargo or stores; or
    (ii) Military necessity requires immediate work on a vessel.
    (b) Process this type of undefinitized contract action in accordance 
with subpart 217.74.
    (c) Negotiate a price as soon as practicable after the issuance of 
an undefinitized order and definitize the job order upon completing 
negotiations.



217.7103-6  Repair costs not readily ascertainable.

    If the nature of any repairs is such that their extent and probable 
cost cannot be ascertained readily, the solicitation should--
    (a) Solicit offers for determining the nature and extent of the 
repairs;
    (b) Provide that upon determination by the contracting officer of 
what work is necessary, the contractor, if requested by the contracting 
officer, shall negotiate prices for performance of the repairs; and
    (c) Provide that prices for the repairs, if ordered, will be set 
forth in a modification of the job order.



217.7103-7  Modification of master agreements.

    (a) Review each master agreement at least annually before the 
anniversary of its effective date and revise it as necessary to conform 
to the requirements of the FAR and DFARS. Statutory or other mandatory 
changes may require review and revision earlier than one year.
    (b) A master agreement shall be changed only by modifying the master 
agreement itself. It shall not be changed through a job order.
    (c) A modification to a master agreement shall not affect job orders 
issued before the effective date of the modification.



217.7104  Contract clauses.

    (a) Use the following clauses in solicitations for, and in, master 
agreements for repair and alteration of vessels:
    (1) 252.217-7003, Changes.

[[Page 117]]

    (2) 252.217-7004, Job Orders and Compensation.
    (3) 252.217-7005, Inspection and Manner of Doing Work.
    (4) 252.217-7006, Title.
    (5) 252.217-7007, Payments.
    (6) 252.217-7008, Bonds.
    (7) 252.217-7009, Default.
    (8) 252.217-7010, Performance.
    (9) 252.217-7011, Access to Vessel.
    (10) 252.217-7012, Liability and Insurance.
    (11) 252.217-7013, Guarantees.
    (12) 252.217-7014, Discharge of Liens.
    (13) 252.217-7015, Safety and Health.
    (14) 252.217-7016, Plant Protection, as applicable.
    (b)(1) Incorporate in solicitations for, and in, job orders, the 
clauses in the master agreement, and any other clauses on subjects not 
covered by the master agreement, but applicable to the job order to be 
awarded.
    (2) Use the clause at 252.217-7016, Plant Protection, in job orders 
where performance is to occur at the contractor's facility.



                Subpart 217.72--Bakery and Dairy Products



217.7200  Scope.

    This subpart provides special policies and requirements for 
acquisition of perishable bakery and dairy products.



217.7201  Contract requirements for dairy products.

    (a) Include the following chemical and microbiological requirements 
in solicitations and resulting contracts for milk, milk products, and 
cultured products (as defined in the Veterinary/Medical Wholesomeness 
Assurance Program for Fresh and Cultured Dairy Products and Frozen 
Desserts (AR-40-70/NAVSUPINST 4355.6/AFR 161-46/MCO 10110.44)):
    (1) Chemical requirements. Products shall meet the chemical 
requirements for each specification cited in the contract on the date of 
award.
    (2) Microbiological requirements. Products shall meet 
microbiological requirements stated in Public Health Service Publication 
229, Grade A Pasteurized Milk Ordnance, in effect on the date of award. 
In the event of conflict between these requirements and individual 
product specifications, the requirements of Public Health Service 
Publication 229 take precedence.
    (b) When the contractor is required to furnish its own cabinets for 
dispensing milk from bulk containers--
    (1) Include the following information in the solicitation--
    (i) The number (or estimated number) of dispenser cabinets required;
    (ii) Whether metal stands for the cabinets are required;
    (iii) The number of cabinets required with a capacity of two 
containers each; and
    (iv) The number required with a capacity of three containers each.
    (2) Include the contractor's list of cabinet equipment in the 
schedule of the contract.
    (c) The contracting officer shall notify the Government quality 
assurance representative of code changes approved under the clause at 
252.217-7022, Code Dating.



217.7202  Contract type.

    Normally use requirements contracts for bakery and dairy products. 
Other indefinite delivery contracts and other contract types may be used 
as appropriate.



217.7203  Contract clauses.

    (a) Use the following additional clauses in solicitations and 
contracts for perishable bakery and dairy products--
    (1) 252.217-7017, Time of Delivery. Use Alternate I when the 
contract is other than a requirements contract. Insert the number of 
hours in paragraph (c) of Alternate I.
    (2) 252.217-7018, Change in Plant Location.
    (3) 252.217-7019, Sanitary Conditions. Use Alternate I when the 
contract is other than a requirements contract.
    (4) 252.217-7022, Code Dating. Use this clause only when the 
schedule or a specification requires labels showing the date of 
pasteurization, manufacture, production, or processing.
    (5) 252.217-7023, Marking. Do not use this clause when MIL-STD-129, 
Marking for Shipment and Storage, is required.
    (6) 252.217-7024, Responsibility for Containers and Equipment. Use 
when

[[Page 118]]

contractor is required to provide reusable containers and equipment.
    (b) Use the following additional clauses in solicitations and 
contracts for perishable dairy products--
    (1) 252.217-7020, Examination and Testing. Use Alternate I when the 
contract is an indefinite quantity contract.
    (2) 252.217-7021, Deficiency Adjustment.
    (3) 252.217-7025, Containers and Equipment.



           Subpart 217.73--Identification of Sources of Supply



217.7300  Scope.

    This subpart implements 10 U.S.C. 2384. It contains policy and 
procedures for requiring contractors to identify the actual manufacturer 
of supplies furnished to DoD.



217.7301  Policy.

    Contractors shall identify their sources of supply in contracts for 
supplies. Contractor identification of sources of supply enables 
solicitation, in subsequent acquisitions, of actual manufacturers or 
other suppliers of items. This enhances competition and potentially 
avoids payment of additional costs for no significant added value.



217.7302  Procedures.

    (a) Whenever practicable, include a requirement for contractor 
identification of sources of supply in all contracts for the delivery of 
supplies. The identification shall include--
    (1) The item's actual manufacturer or producer, or all the 
contractor's sources for the item;
    (2) The item's national stock number (if there is one);
    (3) The item identification number used by--
    (i) The actual manufacturer or producer of the item; or
    (ii) Each of the contractor's sources for the item; and
    (4) The source of any technical data delivered under the contract.
    (b) The requirement in paragraph (a) of this section does not apply 
to commercial items.
[56 FR 36345, July 31, 1991, as amended at 60 FR 61596, Nov. 30, 1995]



217.7303  Solicitation provision.

    (a) Use the provision at 252.217-7026, Identification of Sources of 
Supply, or one substantially the same, in all solicitations for supplies 
when the acquisition is being conducted under other than full and open 
competition, except when--
    (1) Using FAR 6.302-5;
    (2) The contracting officer already has the information required by 
the provision (e.g., the information was obtained under other 
acquisitions);
    (3) The contract is for subsistence, clothing or textiles, fuels, or 
supplies purchased and used outside the United States;
    (4) The contracting officer determines that it would not be 
practicable to require offerors/contractors to provide the information, 
e.g., nonrepetitive local purchases; or
    (5) The contracting officer determines that the exception at 
217.7302(b) applies to all items under the solicitation.
    (b) If appropriate, use the provision at 252.217-7026, 
Identification of Sources of Supply, or one substantially the same, in 
service contracts requiring the delivery of supplies.



             Subpart 217.74--Undefinitized Contract Actions



217.7400  Scope.

    This subpart prescribes policies and procedures implementing 10 
U.S.C. 2326.



217.7401  Definitions.

    As used in this subpart--
    (a) Contract action means an action which results in a contract.
    (1) It includes contract modifications for additional supplies or 
services.
    (2) It does not include change orders, administrative changes, 
funding modifications, or any other contract modifications that are 
within the scope and under the terms of the contract, e.g., engineering 
change proposals, value

[[Page 119]]

engineering change proposals, and over and above work requests as 
described in subpart 217.77.
    (b) Definitization means the agreement on, or determination of, 
contract terms, specifications, and price, which converts the 
undefinitized contract action to a definitive contract.
    (c) Qualifying proposal means a proposal containing sufficient 
information for the DoD to do complete and meaningful analyses and 
audits of the--
    (1) Information in the proposal; and
    (2) Any other information that the contracting officer has 
determined DoD needs to review in connection with the contract.
    (d) Undefinitized contract action means any contract action for 
which the contract terms, specifications, or price are not agreed upon 
before performance is begun under the action. Examples are letter 
contracts, orders under basic ordering agreements, and provisioned item 
orders, for which the price has not been agreed upon before performance 
has begun.



217.7402  Exceptions.

    The following undefinitized contract actions (UCAs) are not subject 
to this subpart, but the contracting officer should apply the policy to 
them (and to changes under the Changes clause) to the maximum extent 
practicable--
    (a) UCAs for foreign military sales;
    (b) Purchases at or below the simplified acquisition threshold;
    (c) Special access programs;
    (d) Congressionally mandated long-lead procurement contracts.
[56 FR 36345, July 31, 1991, as amended at 61 FR 7743, Feb. 29, 1996]



217.7403  Policy.

    DoD policy is that undefinitized contract actions shall--
    (a) Be used only when--
    (1) The negotiation of a definitive contract action is not possible 
in sufficient time to meet the Government's requirements; and
    (2) The Government's interest demands that the contractor be given a 
binding commitment so that contract performance can begin immediately.
    (b) Be as complete and definite as practicable under the particular 
circumstances.



217.7404  Limitations.



217.7404-1  Authorization.

    The contracting officer shall obtain approval from the head of the 
contracting activity before--
    (a) Entering into a UCA. The request for approval must fully explain 
the need to begin performance before definitization, including the 
adverse impact on agency requirements resulting from delays in beginning 
performance.
    (b) Including requirements for non-urgent spare parts and support 
equipment in a UCA. The request should show that inclusion of the non-
urgent items is consistent with good business practices and in the best 
interest of the United States.
    (c) Modifying the scope of a UCA when performance has already begun. 
The request should show that the modification is consistent with good 
business practices and in the best interests of the United States.



217.7404-2  Price ceiling.

    UCAs shall include a not-to-exceed price.



217.7404-3  Definitization schedule.

    (a) UCAs shall contain definitization schedules which provide for 
definitization by the earlier of the following dates--
    (1) The date which is 180 days after issuance of the action (this 
date may be extended but may not exceed the date which is 180 days after 
the contractor submits a qualifying proposal); or
    (2) The date on which the amount of funds obligated under the 
contract action is equal to more than 50 percent of the not-to-exceed 
price.
    (b) Submission of a qualifying proposal in accordance with the 
definitization schedule is a material element of the contract. If the 
contractor does not submit a timely qualifying proposal, the contracting 
officer may suspend or reduce progress payments under FAR 32.503-6, or 
take other appropriate action.
[56 FR 36345, July 31, 1991, as amended at 60 FR 29498, June 5, 1995; 61 
FR 7743, Feb. 29, 1996]

[[Page 120]]



217.7404-4  Limitations on obligations.

    The Government shall not obligate more than 50 percent of the not-
to-exceed price before definitization. However, if a contractor submits 
a qualifying proposal before 50 percent of the not-to-exceed price has 
been obligated by the Government, then the limitation on obligations 
before definitization may be increased to no more than 75 percent (see 
232.102-70 for coverage on provisional delivery payments).
[60 FR 29498, June 5, 1995]



217.7404-5  Exceptions.

    (a) The limitations in 217.7404-2, 217.7404-3, and 217.7404-4 do not 
apply to UCAs for the purchase of initial spares.
    (b) The head of an agency may waive the limitations in 217.7404-2, 
217.7404-3, and 217.7404-4 for UCAs if the head of the agency determines 
that the waiver is necessary to support a contingency operation.
[60 FR 29498, June 5, 1995]



217.7404-6  Allowable profit.

    When the final price of a UCA is negotiated after a substantial 
portion of the required performance has been completed, the head of the 
agency shall ensure the profit allowed reflects--
    (a) Any reduced cost risk to the contractor for costs incurred 
during contract performance before negotiation of the final price; and
    (b) The contractor's reduced cost risk for costs incurred during 
performance of the remainder of the contract.



217.7405  Definitizations.

    For each definitization modification, the contracting officer shall 
include all data required by 243.171.
[60 FR 34470, July 3, 1995]



217.7406  Contract clauses.

    (a) Use the clause at FAR 52.216-24, Limitation of Government 
Liability, in all UCAs, solicitations associated with UCAs, basic 
ordering agreements, indefinite delivery contracts, and any other type 
of contract providing for the use of UCAs.
    (b) Use the clause at 252.217-7027, Contract Definitization, in all 
UCAs, solicitations associated with UCAs, basic ordering agreements, 
indefinite delivery contracts, and any other type of contract providing 
for the use of UCAs. Insert the applicable information in paragraphs 
(a), (b), and (d) of the clause. If, at the time of entering into the 
UCA, the contracting officer knows that the definitive contract action 
will meet the criteria of FAR 15.804-1 for not requiring submission of 
cost or pricing data, the words ``and cost or pricing data'' may be 
deleted from paragraph (a) of the clause.
[61 FR 7743, Feb. 29, 1996]



           Subpart 217.75--Acquisition of Replenishment Parts



217.7500  Scope of subpart.

    This subpart provides guidance on additional requirements related to 
acquisition of replenishment parts (as defined in appendix E).



217.7501  General.

    Departments and agencies--
    (a) May acquire replenishment parts concurrently with production of 
the end item.
    (b) Shall provide for full and open competition when fully adequate 
drawings and any other needed data are available with the right to use 
for acquisition purposes (see part 227). However--
    (1) When data is not available for a competitive acquisition, use 
one of the procedures in 217.7503.
    (2) Replenishment parts must be acquired so as to ensure the safe, 
dependable, and effective operation of the equipment. Where this 
assurance is not possible with new sources, competition may be limited 
to the original manufacturer of the equipment or other sources that have 
previously manufactured or furnished the parts as long as the action is 
justified.
    (c) Shall follow the limitations on price increases in 217.7504.



217.7502  Spares acquisition integrated with production (SAIP).

    (a) Spares acquisition integrated with production (SAIP) is a 
technique used to acquire replenishment parts

[[Page 121]]

concurrently with parts being produced for the end item.
    (b) DoD acquisition managers select parts for SAIP under the 
criteria in DoDI 4245.12, Spares Acquisition Integrated With Production 
(SAIP).
    (c) Include appropriately tailored provisions in the contract when 
SAIP is used.



217.7503  Acquisition of parts when data is not available.

    When acquiring a part for which the Government does not have 
necessary data with rights to use in a specification or drawing for 
competitive acquisition, use one of the following procedures in order of 
preference--
    (a) When items of identical design are not required, the acquisition 
may still be conducted through full and open competition by using a 
performance specification or other similar technical requirement or 
purchase description that does not contain data with restricted rights. 
Two methods are--
    (1) Two-step sealed bidding; and
    (2) Brand name or equal purchase descriptions.
    (b) When other than full and open competition is authorized under 
FAR part 6, acquire the part from the firm which developed or designed 
the item or process, or its licensees, provided productive capacity and 
quality are adequate and the price is fair and reasonable.
    (c) When additional sources are needed and the procedures in 
paragraph (a) of this section are not practicable, consider the 
following alternatives--
    (1) Encourage the developer to license others to manufacture the 
parts;
    (2) Acquire the necessary rights in data;
    (3) Use a leader company acquisition technique (FAR subpart 17.4) 
when complex technical equipment is involved and establishing 
satisfactory additional sources will require technical assistance as 
well as data; or
    (4) Incorporate a priced option in the contract which allows the 
Government to require the contractor to establish a second source.
    (d) As a last alternative, the contracting activity may develop a 
design specification for competitive acquisition through reverse 
engineering. Contracting activities shall not do reverse engineering 
unless--
    (1) Significant cost savings can be demonstrated; and
    (2) The action is authorized by the head of the contracting 
activity.



217.7504  Limitations on price increases.

    This section provides implementing guidance for section 1215 of 
Public Law 98-94 (10 U.S.C. 2452 note).
    (a) The contracting officer shall not award, on a sole source basis, 
a contract for any centrally managed replenishment part when the price 
of the part has increased by 25 percent or more over the most recent 12-
month period.
    (1) Before computing the percentage difference between the current 
price and the prior price, adjust for quantity, escalation, and other 
factors necessary to achieve comparability.
    (2) Departments and agencies may specify an alternate percentage or 
percentages for contracts within the small purchase limitation in FAR 
part 13.
    (b) The contracting officer may award a contract for a part, the 
price of which exceeds the limitation in paragraph (a) of this section, 
if the contracting officer certifies in writing to the head of the 
contracting activity before award that--
    (1) The contracting officer has evaluated the price of the part and 
concluded that the price increase is fair and reasonable; or
    (2) The national security interests of the United States require 
purchase of the part despite the price increase.
    (c) The fact that a particular price has not exceeded the limitation 
in paragraph (a) of this section does not relieve the contracting 
officer of the responsibility for obtaining a fair and reasonable price.
    (d) Contracting officers may include a provision in sole source 
solicitations requiring that the offeror supply with its proposal, price 
and quantity data on any government orders for the replenishment part 
issued within the most recent 12 months.

[[Page 122]]



        Subpart 217.76--Contracts with Provisioning Requirements



217.7600  Scope of subpart.

    This subpart contains contract requirements and procedures for items 
to be provisioned. For technical requirements of provisioning, see DoDD 
4140.40, Provisioning of End Items of Material. For breakout 
requirements, see appendix E.



217.7601  Definitions.

    As used in this subpart,
    (a) Provisioning means the process of determining and acquiring the 
range and quantity of spare and repair parts, and support and test 
equipment required to operate and maintain an end item for an initial 
period of service.
    (b) Provisioned item means any item selected under provisioning 
procedures.
    (c) Provisioned items order (PIO) means an undefinitized order 
issued under a contract which includes the Government's requirements for 
provisioned items. (Provisioned items with firm prices are acquired by 
supplemental agreement or by separate contract.)
    (d) Provisioning activity means the organization responsible for 
selecting and determining requirements for provisioned items.
    (e) Provisioning requirements statement means the contractual 
document listing the specific provisioning requirements for that 
contract. The statement normally includes:
    (1) Instructions, such as the provisioning method to be used;
    (2) The extent of provisioning technical documentation and data 
needed (including administrative requirements for submission and 
distribution);
    (3) The type and location of provisioning conferences;
    (4) Sample article requirements;
    (5) The delivery schedule;
    (6) Packaging and marking requirements for provisioned items; and
    (7) Requirements for provisioning screening.
    (f) Provisioning technical documentation means the data needed for 
the identification, selection, determination of initial requirements, 
and cataloging of support items to be acquired through the provisioning 
process. It includes such things as provisioning lists and logistics 
support analysis summaries. Descriptive data such as drawings and 
photographs are referred to as supplementary provisioning technical 
documentation.



217.7602  Contracting requirements.



217.7602-1  Contractual provisions.

    Contracts containing provisioning requirements shall--
    (a) List the provisioning functions to be performed and who will 
perform them;
    (b) Include a provisioning requirements statement or specify a time 
limit for its incorporation into the contract by modification (revisions 
to the provisioning requirements statement shall also be incorporated by 
contract modification);
    (c) Include on the DD Form 1423, Contract Data Requirements List, a 
schedule for delivery of provisioning technical documentation, or 
provide for the schedule to be incorporated later by contract 
modification;
    (d) Require flowdown of the appropriate provisioning technical 
documentation requirement when the subcontractor prepares the 
documentation;
    (e) Specify any applicable procedures for interim release by the 
contractor of long lead time items, and include ordering and funding 
instructions for such items. As a minimum, the instructions shall 
require the contractor to advise the contracting officer or provisioning 
activity at least 30 days before release of the items, their estimated 
costs, and the effective date of release;
    (f) Specify the activity designated to issue provisioned items 
orders, i.e., contracting officer, provisioning activity, or 
administrative contracting officer. When it is expected that more than 
one activity will place provisioned items orders against the contract, 
state the requirements for provisioned items of each activity as 
separate contract line items;
    (g) Provide a definitization schedule (normally 120 days after 
receipt of the contractor's proposal), and a timeframe for the 
contractor to furnish price proposals for provisioned items

[[Page 123]]

orders (normally 60 days after order issuance);
    (h) Specify exhibit identifiers applicable to the contract line/
subline items; and
    (i) Include procedures for processing changes (including 
cancellations) in quantities of items ordered.



217.7602-2  Issuance of provisioned items orders.

    (a) Use the Standard Form 30, Amendment of Solicitation/Modification 
of Contract, to--
    (1) Issue provisioned items orders;
    (2) Decrease or cancel quantities of items ordered; and
    (3) Cover the contractor's interim release of long lead items when 
the contracting officer approves the release (if the release is not 
approved, the contracting officer shall notify the contractor to cancel 
the items).
    (b) Include in Block 14 of the Standard Form 30--
    (1) The term PROVISIONED ITEMS ORDER in capital letters and 
underlined; and
    (2) The appropriate exhibit identifier(s) for all attached exhibits.
    (c) Obligate funds to cover the estimated price of the items being 
ordered. Show individual estimated prices for each exhibit line item on 
the accounting and payment office copies.
    (d) Distribution is the same as for the basic contract (see FAR 
4.2). However, if the exhibits are voluminous, the contracting officer 
may restrict distribution of the exhibits to the contract administration 
office.
    (e) See subpart 217.74 for additional guidance and limitations on 
the use of undefinitized contract actions.



217.7603  Contract administration requirements.



217.7603-1  Provisioning conferences.

    When requested by the contracting officer or provisioning activity, 
the contract administration office shall assist the contracting officer 
or provisioning activity in scheduling and determining the types of 
provisioning conferences required, e.g., guidance meetings, long lead 
time items conferences, source coding meetings.



217.7603-2  Contract administration office monitoring.

    The contract administration office (CAO) shall monitor contracts 
containing provisioning requirements. As a minimum the CAO shall--
    (a) Ensure that the contractor understands the provisioning 
requirements;
    (b) Review contractor progress in the preparation of provisioning 
technical documentation and, if requested by the contracting officer or 
provisioning activity, inspect it for format and content;
    (c) Ensure the prime contractor flows-down provisioning requirements 
to any subcontractor charged with preparation of documentation;
    (d) Advise the contracting office or provisioning activity of delays 
in delivery of provisioning technical documentation or other related 
problems (see FAR subpart 42.11);
    (e) Ensure contractor compliance with contract requirements 
concerning the assignment of national stock numbers; and
    (f) Ensure that the contractor complies with contractual criteria 
for release of long lead time items.



217.7603-3  Negotiating and executing supplemental agreements.

    (a) The administrative contracting officer (ACO) shall definitize 
provisioned items orders within the prescribed schedule.
    (b) If the provisioned items order does not contain a delivery date, 
or the contractor cannot meet the date, the ACO shall coordinate the 
negotiated schedule with the contracting officer or provisioning 
activity before execution of the supplemental agreement.
    (c) The ACO shall maintain records of provisioned items orders 
showing--
    (1) The adequacy of obligated funds;
    (2) Due dates for price proposals; and
    (3) Actions taken to obtain additional funds or to deobligate excess 
funds.



                   Subpart 217.77--Over and Above Work



217.7700  Scope of subpart.

    This subpart prescribes policies and procedures for acquisition of 
over and above work.

[[Page 124]]



217.7701  Procedures.

    (a) Contracts for the performance of maintenance, overhaul, 
modification, and repair of various items (e.g., aircraft, engines, 
ground support equipment, ships) generally contain over and above work 
requirements. When they do, the contracting officer shall establish a 
separate contract line item for the over and above work.
    (b) Over and above requirements task the contractor to identify 
needed repairs and recommend corrective action during contract 
performance. The contractor submits a work request to identify the over 
and above work and, as appropriate, the Government authorizes the 
contractor to proceed.
    (c) The clause at 252.217-7028, Over and Above Work, requires the 
contractor and the contracting officer responsible for administering the 
contract to negotiate specific procedures for Government administration 
and contractor performance of over and above work requests.
    (d) The contracting officer may issue a blanket work request 
authorization describing the manner in which individual over and above 
work requests will be administered and setting forth a dollar limitation 
for all over and above work under the contract. The blanket work request 
authorization may be in the form of a letter or contract modification 
(Standard Form 30).
    (e) Over and above work requests are within the scope of the 
contract. Therefore, procedures in subpart 217.74, Undefinitized 
Contractual Actions, do not apply.
    (f) To the maximum extent practical, over and above work shall be 
negotiated prior to performance of the work.



217.7702  Contract clause.

    Use the clause at 252.217-7028, Over and Above Work, in 
solicitations and contracts containing requirements for over and above 
work, except as provided for in subpart 217.71.

[[Page 125]]



                  SUBCHAPTER D--SOCIOECONOMIC PROGRAMS





PART 219--SMALL BUSINESS PROGRAMS--Table of Contents




Sec.
219.000  Scope of part.
219.001  Definitions.

                         Subpart 219.2--Policies

219.201  General policy.
219.202  Specific policies.
219.202-1  Encouraging small business participation in acquisitions.
219.202-5  Data collection and reporting requirements.

   Subpart 219.3--Determination of Status as a Small Business Concern

219.301  Representation by the offeror.
219.302  Protesting a small business representation.
219.302-70  Protesting a small disadvantaged business representation.
219.304  Solicitation provisions.

    Subpart 219.4--Cooperation With the Small Business Administration

219.401  General.

              Subpart 219.5--Set-Asides for Small Business

219.501  General.
219.502  Setting aside acquisitions.
219.502-1  Requirements for setting aside acquisitions.
219.502-2  Total set-asides.
219.502-2  -70  Total set-asides for small disadvantaged business 
          concerns.
219.502-3  Partial set-asides.
219.502-4  Methods of conducting set-asides.
219.504  Set aside program order of precedence.
219.505  Rejecting Small Business Administration recommendations.
219.506  Withdrawing or modifying set-asides.
219.508  Solicitation provisions and contract clauses.
219.508-70  Solicitation provisions and contract clauses.

                Subpart 219.6--Certificates of Competency

219.602  Procedures.
219.602-1  Referral.
219.602-3  Resolving differences between the agency and the Small 
          Business Administration.

 Subpart 219.7--Subcontracting With Small Business, Small Disadvantaged 
            Business and Women-Owned Small Business Concerns

219.702  Statutory requirements.
219.703  Eligibility requirements for participating in the program.
219.704  Subcontracting plan requirements.
219.705  Responsibilities of the contracting officer under the 
          subcontracting assistance program.
219.705-2  Determining the need for a subcontracting plan.
219.705-4  Reviewing the subcontracting plan.
219.706  Responsibilities of the cognizant administrative contracting 
          officer.
219.708  Solicitation provisions and contract clauses.

 Subpart 219.8--Contracting With the Small Business Administration (The 
                              8(a) Program)

219.803  Selecting acquisitions for the 8(a) Program.
219.804  Evaluation, offering, and acceptance.
219.804-1  Agency evaluation.

  Subpart 219.10--Small Business Competitiveness Demonstration Program

219.1005  Applicability.
219.1006  Procedures.
219.1007  Solicitation provisions.

 Subpart 219.70--Evaluation Preference for Small Disadvantaged Business 
                             (SDB) Concerns

219.7000  Policy.
219.7001  Applicability.
219.7002  Procedures.
219.7003  Solicitation provisions and contract clauses.

              Subpart 219.71--Pilot Mentor-Protege Program

219.7100  Scope.
219.7101  Policy.
219.7102  General.
219.7103  Procedures.
219.7103-1  General.
219.7103-2  Contracting officer responsibilities.
219.7104  Developmental assistance costs eligible for reimbursement or 
          credit.
219.7105  Reporting.

[[Page 126]]

 Subpart 219.72--Evaluation Preference for Small Disadvantaged Business 
        (SDB) Concerns in Construction Acquisitions--Test Program

219.7200  Policy.
219.7201  Administration of the test program.
219.7202  Applicability.
219.7203  Procedures.
219.7204  Contract clause.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36353, July 31, 1991, unless otherwise noted.



219.000  Scope of part.

    This part also implements 10 U.S.C. 2323, which sets a goal for DoD 
for each of fiscal years 1987 through 2000 to--
    (1) Award five percent of contract and subcontract dollars to small 
disadvantaged business (SDB) concerns, historically black colleges and 
universities (HBCUs), and minority institutions (MIs) (See part 226 for 
policy/procedures on HBCU/MIs); and
    (2) Maximize the number of such entities in DoD contracting and 
subcontracting.
[56 FR 36353, July 31, 1991, as amended at 59 FR 27670, May 27, 1994]



219.001  Definitions.

    The definition of small disadvantaged business concern to be used 
for DoD contracts is in the provision at 252.219-7000 and is more 
restrictive than the definition in FAR 19.001.



                         Subpart 219.2--Policies



219.201  General policy.

    (a) The DoD will use the section 8(a) program, small disadvantaged 
business set asides and evaluation preferences, advance payments, 
outreach, and technical assistance to meet its five percent goal for 
contract and subcontract awards to small disadvantaged businesses.
    (c)(2) For the defense agencies, the director of the Office of Small 
and Disadvantaged Business Utilization shall be appointed by, be 
responsible to, and report directly to the director deputy director of 
the defense agency.
    (7) The responsibility for assigning small business technical 
advisors is delegated to the head of the contracting activity.
    (9) Contracting activity small business specialists perform this 
function by--
    (A) Reviewing and making recommendations for all acquisitions over 
$10,000, except small business-small purchase set-asides;
    (B) Making the review before issue of the solicitation or contract 
modification and documenting it on DD Form 2579, Small Business 
Coordination Record;
    (C) Referring recommendations which have been rejected by the 
contracting officer to the Small Business Administration (SBA) 
procurement center representative. However, in the case of a rejected 
small disadvantaged business set-aside recommendation or if an SBA 
representative is not assigned or available, the specialist refers the 
matter to the specialist's appointing authority.
    (d) Contracting and contract administration activities appoint small 
business specialists as directed by DoDD 4205.1, DoD Small Business and 
Small Disadvantaged Business Utilization Programs. Specialists--
    (i) Report directly and are responsible only to their appointing 
authority;
    (ii) Make sure that the contracting activity takes the necessary 
actions to implement small business, historically black college and 
university/minority institution, and labor surplus area programs;
    (iii) Advise and assist contracting, program manager, and 
requirements personnel on all matters which affect small businesses, 
historically black colleges and universities or minority institutions, 
and labor surplus area concerns;
    (iv) Aid, counsel, and assist small business, small disadvantaged 
business, historically black colleges and universities, and minority 
institutions by providing--
    (A) Advice concerning acquisition procedures;
    (B) Information regarding proposed acquisitions; and
    (C) Instructions on preparation of proposals in the interpretation 
of

[[Page 127]]

standard clauses, representations, and certifications;
    (v) Maintain an outreach program (including participation in 
Government-industry conferences and regional interagency small business 
councils) designed to locate and develop information on the technical 
competence of small business, small disadvantaged business concerns, 
historically black colleges and universities, and minority institutions;
    (vi) Ensure that financial assistance, available under existing 
regulations, is offered and also assist small business concerns in 
obtaining payments under their contracts, late payment, interest 
penalties, or information on contractual payment provisions;
    (vii) Provide assistance to contracting officers in determining the 
need for and acceptability of subcontracting plans and assist 
administrative contracting officers (see 219.706(a)(ii)) in evaluating, 
monitoring, reviewing, and documenting contract performance to determine 
compliance with subcontracting plans; and
    (viii) Recommend to the appointing authority the activity's small 
and disadvantaged business program goals, including goal assignments to 
subordinate contracting offices; monitor the activity's performance 
against these goals; and recommend action to correct reporting errors/
deficiencies.



219.202  Specific policies.



219.202-1  Encouraging small business participation in acquisitions.

    The DoD will maximize the use of small business concerns as planned 
producers in the Industrial Readiness Planning Program.



219.202-5  Data collection and reporting requirements.

    Determine the premium percentage to be entered in Item D4E of the 
Individual Contract Action Report (DD Form 350), (see 253.204-70), as 
follows --
    (1) For small disadvantaged business or historically black college 
and university/minority institution set-asides, divide the difference 
between the fair market price and the award price by the fair market 
price.
    (2) For 219.7000 evaluation preference awards, divide the difference 
between the low responsive offer and the award price by the low 
responsive offer.
    (3) For 219.502-3 preferential consideration awards, divide the 
difference between the award price on the non-set-aside portion and the 
award price on the set-aside portion by the award price on the non-set-
aside portion.
    (b) Within 60 days after the end of each fiscal year, departments 
and agencies shall submit the report to the Secretary of Defense, who 
will report to the SBA on behalf of all DoD departments and agencies. 
Reports must include--
    (i) Justification for failure to meet goals established by the 
Office of the Secretary of Defense; and
    (ii) Planned actions for increasing participation by such firms in 
future contract awards.



   Subpart 219.3--Determination of Status as a Small Business Concern



219.301  Representation by the offeror.

    (a) A concern must qualify as a small disadvantaged business (SDB) 
on the date of submission of its initial offer including price to be 
eligible for--
    (i) Award under a small disadvantaged business set-aside;
    (ii) Preferential consideration as an SDB under a partial set-aside; 
or
    (iii) An evaluation preference for SDBs.
    (b) The contracting officer shall protest an offeror's 
representation that it is a small disadvantaged business concern when--
    (i) There is conflicting evidence;
    (ii) The offeror represents that the Small Business Administration 
previously determined the concern to be non-disadvantaged; or
    (iii) The offeror represents its ownership as other than Black 
American, Hispanic American, Native American (including Indian tribes 
and Native Hawaiian organizations), Asian Pacific American, or 
Subcontinent Asian American, unless the offeror represents that--
    (A) It currently is in the Section 8(a) program; or

[[Page 128]]

    (B) Within the 6 months preceding submission of its offer, the 
offeror was determined by the Small Business Administration to be 
socially and economically disadvantaged, and no circumstances have 
changed to vary that determination.
[56 FR 36353, July 31, 1991, as amended at 59 FR 22131, Apr. 29, 1994; 
62 FR 2613, Jan. 17, 1997]



219.302  Protesting a small business representation.



219.302-70  Protesting a small disadvantaged business representation.

    This section applies to protests of a small business concern's 
status as socially and economically disadvantaged. Protests of a 
concern's size are processed under FAR 19.302. Any offeror, the 
contracting officer, or the Small Business Administration (SBA) may 
protest a concern's representation of disadvantaged status.
    (a) An offeror may protest a concern's representation of 
disadvantaged status by filing a protest with the contracting officer. 
The protest--
    (1) Must be filed within the times specified in FAR 19.302(d)(1); 
and
    (2) Must contain specific detailed evidence supporting the basis of 
protest.
    (b) The contracting officer or the SBA may protest a concern's 
representation of disadvantaged status at any time.
    (1) If a contracting officer's protest is based on information 
brought to his/her attention by a party ineligible to protest directly 
or ineligible to protest under the timeliness standard, the contracting 
officer must be persuaded by the evidence presented before adopting the 
grounds for protest as his or her own.
    (2) The SBA protests a concern's representation of disadvantaged 
status by filing directly with its Office of Program Eligibility and 
notifying the contracting officer.
    (c) The contracting officer shall return untimely protests to the 
protestor. This includes protests filed before bid opening or 
notification of apparent successful offeror.
    (d) Upon receipt of a timely protest, the contracting officer shall 
withhold award and forward the protest to the SBA Office of Program 
Eligibility, Office of Minority Small Business and Capitol Ownership 
Development, 409 3rd Street, SW., Washington, DC 20416. Send SBA--
    (1) The protest;
    (2) The date the protest was received and a determination of 
timeliness; and
    (3) The date of bid opening or date on which notification of 
apparent successful offeror was sent to unsuccessful offerors.
    (e) Do not withhold award when--
    (1) The contracting officer makes a written determination that award 
must be made to protect the public interest; or
    (2) The offeror represents that, within the 6 months preceding 
submission of its offer, the SBA has determined the concern to be 
socially and economically disadvantaged, and no circumstances have 
changed to vary that determination.
    (f) The SBA Director, Office of Program Eligibility, will determine 
the disadvantaged status of the challenged offeror and notify the 
contracting officer, the challenged offeror, and the protestor. Award 
may be made on the basis of that determination. The determination is 
final for purposes of the instant acquisition, unless--
    (1) It is appealed; and
    (2) The contracting officer receives the appeal decision before 
award.
    (g) If the contracting officer does not receive an SBA determination 
within 15 working days after the SBA's receipt of the protest, the 
contracting officer shall presume that the challenged offeror is 
socially and economically disadvantaged. Do not use the presumption as a 
basis for award without first inquiring as to when a determination can 
be expected and waiting for the determination, unless further delay in 
award would be disadvantageous to the Government.
    (h) An SBA determination may be appealed by--
    (1) The interested party whose protest has been denied;
    (2) The concern whose status was protested; or
    (3) The contracting officer.

[[Page 129]]

    The appeal must be filed with the SBA's Associate Administrator for 
Minority Small Business and Capital Ownership Development within five 
working days after receipt of the determination. If the contracting 
officer receives the SBA's decision on the appeal before award, the 
decision shall apply to the instant acquisition. If the decision is 
received after award, it will apply to future acquisitions.
[56 FR 36353, July 31, 1991, as amended at 62 FR 2613, Jan. 17, 1997]



219.304  Solicitation provisions.

    (b) Use the provision at 252.219-7000, Small Disadvantaged Business 
Concern Representation (DoD Contracts) instead of the provision at FAR 
52.219-2, Small Disadvantaged Business Concern Representation.



    Subpart 219.4--Cooperation With the Small Business Administration



219.401  General.

    (b) The contracting activity small business specialist is the 
primary activity focal point for interface with the SBA.



              Subpart 219.5--Set-Asides for Small Business



219.501  General.

    (g) This repetitive set-aside procedure applies to DoD.
    (S-70) When a product or service has been acquired successfully by a 
contracting office as a small disadvantaged business set-aside, all 
future requirements of that office for that product or service shall be 
acquired as small disadvantaged business set-asides, except those--
    (1) Processed under small purchase procedures; or
    (2) For which the contracting officer determines there is no 
reasonable expectation that the criteria for a small disadvantaged 
business set-aside can be met (see 219.502-2-70(a)).

    Effective Date Note:  At 60 FR 54955, Oct. 27, 1995, in 
Sec. 219.501, (S-70) was stayed indefinitely.



219.502  Setting aside acquisitions.



219.502-1  Requirements for setting aside acquisitions.

    Do not set aside acquisitions for--
    (1) Supplies which were developed and financed, in whole or in part, 
by Canadian sources under the U.S.-Canadian Defense Development Sharing 
Program; or
    (2) Architect-engineer services for military construction or family 
housing projects of $85,000 or more (10 U.S.C. 2855), including 
indefinite delivery and indefinite quantity contracts if the value of 
all anticipated orders is expected to total $85,000 or more.
[58 FR 28465, May 13, 1993]



219.502-2  Total set-asides.

    (a) Unless the contracting officer determines that the criteria for 
set-aside cannot be met, set aside for small business concerns 
acquisitions for--
    (i) Construction, including maintenance and repairs, under $2 
million;
    (ii) Dredging under $1 million; and
    (iii) Architect-engineer services for military construction or 
family housing projects of under $85,000.
[58 FR 28465, May 13, 1993]



219.502-2-70  Total set-asides for small disadvantaged business concerns.

    (a) Except as provided in paragraphs (b) and (c), the contracting 
officer shall set aside an acquisition for small disadvantaged 
businesses when there is a reasonable expectation that--
    (1) Offers will be received from at least two responsible small 
disadvantaged business (SDB) concerns who--
    (i) Can comply with the FAR 52.219-14 limitations on subcontracting; 
or
    (ii) In the case of an SDB regular dealer owned by an Indian tribe, 
including an Alaska Native Corporation, will provide the supplies of a 
small business for contracts awarded during fiscal years 1994 and 1995, 
as provided in section 8051 of Pub. L. 103-139 and section 8012 of Pub. 
L. 103-335; or,
    (iii) In the case of other SDB regular dealers, will provide the 
supplies of SDBs (except as provided in Alternate I of the clause at 
252.219-7002, Notice of Small Disadvantaged Business Set-Aside).

[[Page 130]]

    (2) Award will be made at not more than ten percent above fair 
market price; and
    (3) Scientific and/or technological talent consistent with the 
demands of the acquisition will be offered.
    (b) Do not set aside acquisitions for SDBs when--
    (1) The product or service has been successfully acquired as a small 
business set-aside (see FAR 19.501(g));
    (2) The acquisition is for construction, including maintenance and 
repairs, and is under $2 million, or is for dredging under $1 million;
    (3) The acquisition is for architect-engineer services or 
construction design for military construction projects, without regard 
to dollar value;
    (4) The acquisition is reserved for the 8(a) program;
    (5) The acquisition is processed under small purchase procedures; or
    (6) The acquisition is for commissary or exchange resale items.
    (c) Pursuant to 10 U.S.C. 2323(g), the Office of Small and 
Disadvantaged Business Utilization, Office of the Under Secretary of 
Defense (Acquisition & Technology), is responsible for determining 
whether use of small disadvantaged business (SDB) set-asides has caused 
a particular industry category to bear a disproportionate share of the 
contracts awarded by a particular contracting activity to achieve its 
SDB goal. Upon making a determination that a particular industry is 
bearing a disproportionate share, the OUSD(A&T) SADBU shall limit the 
use of total SDB set-asides in the affected industry category, at the 
contracting activity. This limitation shall not apply to solicitations 
that already had been synopsized as SDB set-asides. Forward requests for 
a determination through agency channels to OUSD(A&T) SADBU and include--
    (1) The standard industrial (SIC) code(s) affected;
    (2) Supporting information to justify the request, including dollars 
and percentages by the contracting activity, under the affected SIC 
code(s) for the previous two fiscal years and current fiscal year to 
date for--
    (i) Total awards;
    (ii) Total awards to small businesses;
    (iii) Total awards to SDBs; and
    (iv) Awards to SDBs under the SDB set-aside program.
    (d) See 205.207(d) for information on Commerce Business Daily 
synopsis.
[56 FR 36353, July 31, 1991, as amended at 59 FR 24959, May 13, 1994; 59 
FR 27670, May 27, 1994; 60 FR 29498, June 5, 1995]

    Effective Date Note:  At 60 FR 54955, Oct. 27, 1995, Sec. 219.502-2-
70 was stayed indefinitely.



219.502-3  Partial set-asides.

    When a portion of an acquisition is to be set aside for small 
business concerns, except acquisitions for commissary or exchange 
resale, the contracting officer shall give small disadvantaged business 
concerns preferential consideration by using the procedures in 252.219-
7001, Notice of Partial Small Business Set-Aside with Preferential 
Consideration for Small Disadvantaged Business (SDB) Concerns.



219.502-4  Methods of conducting set-asides.

    (b) Offers on a small disadvantaged business (SDB) set-aside from 
concerns that do not qualify as SDB concerns shall be considered 
nonresponsive and shall be rejected.

    Effective Date Note:  At 60 FR 54955, Oct. 27, 1995, Sec. 219.502-4 
was stayed indefinitely.



219.504  Set-aside program order of precedence.

    (b) The order of precedence for DoD is (except see 219.803(c) and 
226.71)--
    (i) Total set-aside for small disadvantaged business concerns;
    (ii) Total set-aside for small business concerns;
    (iii) Partial set-aside for small business concerns with 
preferential consideration for small disadvantaged business concerns.
[56 FR 36353, July 31, 1991, as amended at 59 FR 12192, Mar. 16, 1994]

    Effective Date Note:  At 60 FR 54955, Oct. 27, 1995, in 
Sec. 219.504, paragraph (b)(i) was stayed indefinitely.



219.505  Rejecting Small Business Administration recommendations.

    (b) The designee shall be at a level no lower than chief of the 
contracting office.

[[Page 131]]



219.506  Withdrawing or modifying set-asides.

    (a) Do not withdraw small disadvantaged business set-asides for 
reasons of price reasonableness unless the low responsive responsible 
offer exceeds fair market price by more than ten percent.

    Effective Date Note:  At 60 FR 54955, Oct. 27, 1995, Sec. 219.506 
was stayed indefinitely.



219.508  Solicitation provisions and contract clauses.

    (d) Use the clause at 252.219-7001, Notice of Partial Small Business 
Set-Aside with Preferential Consideration for Small Disadvantaged 
Business Concerns, instead of the clause in FAR 52.219-7, Notice of 
Partial Small Business Set-Aside. Use the clause with its Alternate I 
when the contracting officer determines that there are no small 
disadvantaged business manufacturers that can meet the requirements of 
the solicitation.
    (e) Use the clause at 52.219-14, Limitations on Subcontracting, also 
in small disadvantaged business set-asides.
[56 FR 36353, July 31, 1991, as amended at 57 FR 42630, Sept. 15, 1992]

    Effective Date Note:  At 60 FR 54955, Oct. 27, 1995, in 
Sec. 219.508, paragraph (e) was stayed indefinitely.



219.508-70  Solicitation provisions and contract clauses.

    Use the clause at 252.219-7002, Notice of Small Disadvantaged 
Business Set-Aside, in solicitations and contracts for small 
disadvantaged business set-asides. Use the clause with its Alternate I 
when the contracting officer determines that there are no small 
disadvantaged business manufacturers that can meet the requirements of 
the solicitation.

    Effective Date Note:  At 60 FR 54955, Oct. 27, 1995, Sec. 219.508-70 
was stayed indefinitely.



                Subpart 219.6--Certificates of Competency



219.602  Procedures.



219.602-1  Referral.

    When making a nonresponsibility determination on a small business 
concern, the contracting officer shall notify the contracting activity's 
small business specialist.
[58 FR 28465, May 13, 1993, as amended at 60 FR 40107, Aug. 7, 1995]



219.602-3  Resolving differences between the agency and the Small Business Administration.

    (c)(i) If the contracting officer believes the agency should appeal, 
the contracting officer shall immediately inform the departmental 
director of the Office of Small and Disadvantaged Business Utilization, 
and send the director, through departmental channels--
    (A) A request for appeal, summarizing the issues. The request must 
be sent to arrive within five working days after receipt of the SBA 
Headquarters' written position.
    (B) An appeal file, documenting the contracting activity's position. 
The file must be sent to arrive within five working days after 
transmission of the request.
    (ii) The departmental director will determine whether the agency 
will appeal and will notify the SBA of the agency's intent.
[56 FR 36353, July 31, 1991, as amended at 62 FR 34122, June 24, 1997]



 Subpart 219.7--Subcontracting with Small Business, Small Disadvantaged 
            Business and Women-Owned Small Business Concerns



219.702  Statutory requirements.

    (a) Section 834 of Public Law 101-189, as amended, requires the DoD 
to establish a test program to determine whether comprehensive 
subcontracting plans on a corporate, division, or plant-wide basis will 
reduce administrative burdens while enhancing subcontracting 
opportunities for small and small disadvantaged business concerns.
    (i) The test program--
    (A) Will be conducted--
    (1) From October 1, 1990, through September 30, 1998;
    (2) In accordance with the DoD test plan, ``Test Program for 
Negotiation of Comprehensive Small Business Subcontracting Plans;'' and

[[Page 132]]

    (3) By the military departments and agencies through specifically 
designated contracting activities; and
    (B) Permits contractors selected by the designated contracting 
activities to--
    (1) Negotiate plant, division, or company-wide comprehensive 
subcontracting plans instead of individual contract subcontracting 
plans; and
    (2) Use the comprehensive plans in all DoD contracts which require a 
subcontracting plan.
    (ii) The comprehensive subcontracting plans will--
    (A) Be negotiated on an annual basis by the designated contracting 
activities;
    (B) Be incorporated by the contractors' cognizant contract 
administration activity into all of the contractors' active DoD 
contracts which require a plan;
    (C) Be used by all DoD contracting officers in contracts, which 
require a plan, awarded the selected contractors during the test period; 
and
    (D) Not be subject to application of liquidated damages during the 
period of the test program (section 402, Pub. L. 101-574).
[56 FR 36353, July 31, 1991, as amended at 60 FR 35668, July 10, 1995; 
61 FR 39900, July 31, 1996]



219.703  Eligibility requirements for participating in the program.

    (a) Qualified nonprofit agencies for the blind and other severely 
disabled, that have been approved by the Committee for Purchase from 
People Who Are Blind or Severely Disabled under the Javits-Wagner-O'Day 
Act (41 U.S.C. 46-48), are eligible as a result of section 9077 of Pub. 
L. 102-396, and subsequent Appropriations Acts, and sections 808 of Pub. 
L. 102-484 and 804 of Pub. L. 103-337 through September 30, 1997, to 
participate in the program. Under this authority, subcontracts awarded 
to such entities may be counted toward the prime contractor's small 
business subcontracting goal through fiscal year 1997.
    (2)(A) To be eligible as an SDB subcontractor, a concern must meet 
the definition in the provision at 252.219-7000, Small Disadvantaged 
Business Concern Representation (DoD Contracts).
    (B) To be eligible as a historically black college or university or 
minority institution subcontractor, such entity must meet the definition 
in the clause at 252.219-7003, Small Business and Small Disadvantaged 
Business Subcontracting Plan (DoD Contracts).
    (b) A contractor may also rely on the written representation as to 
status of--
    (i) A historically black college or university or minority 
institution; or
    (ii) A qualified nonprofit agency for the blind and other severely 
handicapped approved by the Committee for Purchase from the Blind and 
Other Severely Handicapped.
[57 FR 42630, Sept. 15, 1992, as amended at 58 FR 28465, May 13, 1993; 
60 FR 13075, Mar. 10, 1995; 60 FR 41157, Aug. 11, 1995; 60 FR 61596, 
Nov. 30, 1995; 61 FR 50535, Sept. 26, 1996]



219.704  Subcontracting plan requirements.

    (a)(1) The goal for use of small disadvantaged business concerns 
shall include subcontracts with historically black colleges and 
universities and minority institutions (see subpart 226.70), in addition 
to subcontracts with small disadvantaged business concerns. Subcontracts 
with historically black colleges and universities and minority 
institutions do not have to be included in the small disadvantaged 
business goal in commercial items subcontracting plans.
    (4) In those subcontracting plans which specifically identify small, 
small disadvantaged, and women-owned small businesses, prime contractors 
shall notify the administrative contracting officer of any substitutions 
of firms that are not small, small disadvantaged, or women-owned small 
businesses for the firms listed in the subcontracting plan. 
Notifications shall be in writing and shall occur within a reasonable 
period of time after award of the subcontract. Contractor-specified 
formats shall be acceptable.
[60 FR 61596, Nov. 30, 1995, as amended at 61 FR 18687, Apr. 29, 1996]

[[Page 133]]



219.705  Responsibilities of the contracting officer under the subcontracting assistance program.



219.705-2  Determining the need for a subcontracting plan.

    (d) See 215.605 for unique DoD requirements.
[59 FR 27670, May 27, 1994]



219.705-4  Reviewing the subcontracting plan.

    (d) Challenge any subcontracting plan that does not contain positive 
goals and consider the extent to which an offeror plans to use 
competition restricted to small disadvantaged business concerns, 
historically black colleges and universities, or minority institutions. 
A small disadvantaged business goal of less than five percent must be 
approved two levels above the contracting officer.



219.706  Responsibilities of the cognizant administrative contracting officer.

    (a)(i) The contract administration office also is responsible for 
reviewing, evaluating, and approving master subcontracting plans.
    (ii) The small business specialist supports the administrative 
contracting officer in evaluating a contractor's performance and 
compliance with its subcontracting plan.



219.708  Solicitation provisions and contract clauses.

    (b)(1)(A) Use the clause at 252.219-7003, Small, Small Disadvantaged 
and Women-Owned Small Business Subcontracting Plan (DoD Contracts), in 
solicitations and contracts that contain the clause at FAR 52.219-9, 
Small, Small Disadvantaged and Women-Owned Small Business Subcontracting 
Plan.
    (B) In contracts with contractors which have comprehensive 
subcontracting plans approved under the test program described in 
219.702(a), use the clause at 252.219-7004, Small, Small Disadvantaged 
and Women-Owned Small Business Subcontracting Plan (Test Program), 
instead of the clauses at 252.219-7003, Small, Small Disadvantaged and 
Women-Owned Small Business Subcontracting Plan (DoD Contracts), and FAR 
52.219-9, Small, Small Disadvantaged and Women-Owned Small Business 
Subcontracting Plan.
    (2) In contracts with contractors which have comprehensive 
subcontracting plans approved under the test program described in 
219.702(a), do not use the clause at FAR 52.219-16, Liquidated Damages--
Small Business Subcontracting Plan.
    (c)(1) Do not use the clause at FAR 52.219-10, Incentive 
Subcontracting Program for Small and Small Disadvantaged Business 
Concerns.
    (A) When contracting by negotiation, use the clause at 252.219-7005, 
Incentive for Subcontracting with Small Businesses, Small Disadvantaged 
Businesses, Historically Black Colleges and Universities, and Minority 
Institutions, in all solicitations and contracts that contain the clause 
at FAR 52.219-9, Small, Small Disadvantaged and Women-Owned Small 
Business Subcontracting Plan. Incentives for exceeding SDB 
subcontracting goals shall be paid only if an SDB subcontracting goal 
was exceeded as a result of actual subcontract awards to SDBs, and not 
as a result of developmental assistant credit under the Pilot Mentor-
Protege Program (see subpart 219.71).
    (B) Use the clause at 252.219-7005 with its Alternate I when, in the 
judgement of the contracting officer, inclusion of an incentive is 
necessary to increase subcontracting opportunities for other small 
businesses.
    (C) Determine the percentage to be negotiated and used in the clause 
by considering the type and extent of effort required to exceed the 
goal, for example--
    (1) Unique outreach programs;
    (2) Use of small disadvantaged businesses, historically black 
colleges and universities, and minority institutions in nontraditional 
areas;
    (3) Technical assistance to qualify or assist these entities; and
    (4) Proximity of subcontractors to the prime.
    (D) Do not use the clauses at 252.219-7005 and FAR 52.219-10 in 
contracts with contractors which have comprehensive subcontracting plans 
approved under the test program described in 219.702(a).

[[Page 134]]

    (c)(2) For negotiated acquisitions of $10 million or more, the 
contracting officer may use an award fee provision instead of the 
incentive provision required by (c)(1)(A). When an award fee provision 
is used, do not use the clauses at 252.219-7005, Incentive for 
Subcontracting with Small Businesses, Small Disadvantaged Businesses, 
Historically Black Colleges and Universities, and Minority Institutions, 
and FAR 52.219-10, Incentive Subcontracting Program for Small and Small 
Disadvantaged Business Concerns. Do not use award fee provisions in 
contracts with contractors which have comprehensive subcontracting plans 
approved under the test program described in 219.702(a).
[56 FR 36353, July 31, 1991, as amended at 56 FR 67213, Dec. 30, 1991; 
61 FR 39901, July 31, 1996]



 Subpart 219.8--Contracting With the Small Business Administration (The 
                              8(a) Program)



219.803  Selecting acquisitions for the 8(a) Program.

    (b) Contracting activities should respond to SBA requests for 
contract support within 30 calendar days after receipt.
    (c) Before considering the set-aside order of precedence in 
219.504(b), review the acquisition for offering under the 8(a) Program.



219.804  Evaluation, offering, and acceptance.



219.804-1  Agency evaluation.

    When SBA asks for a requirement for the 8(a) Program, offer the 
requirement if appropriate, and do not use the small disadvantaged 
business set-aside procedure. If an acquisition, other than a repetitive 
acquisition (as described in FAR 19.804-4), was synopsized using either 
of the notices in 205.207(d) (i) or (ii) before receipt of the SBA 
request, the request does not have to be honored.
    (f) The 8(a) firms should be offered the opportunity to give a 
technical presentation.



  Subpart 219.10--Small Business Competitiveness Demonstration Program



219.1005  Applicability.

    (a)(3)(A) Architect-engineering services in support of military 
construction projects or military family housing projects are exempt 
from the Small Business competitiveness Demonstration Program, except 
for the emerging small business (ESB) set-aside requirements. 
Accordingly, these shall--
    (1) Be reviewed for possible award under the 8(a) program regardless 
of dollar value.
    (2) Not be set-aside for small business or small disadvantaged 
business if the estimated value is $85,000 or more (including indefinite 
delivery-indefinite quantity contracts if the value of all anticipated 
orders exceeds $85,000).
    (3) Be considered for ESB set-aside if the estimated value is both 
less than the emerging small business reserve amount and less than 
$85,000.
    (4) Be considered for small business set-aside (but not SDB set-
aside) if the estimated value is less than $85,000, regardless of 
whether small business set-asides for other architect-engineer services 
are prohibited under the Small Business Competitiveness Demonstration 
Program, when an ESB set-aside is not appropriate.
    (B) All requirements of the Small Business Competitiveness 
Demonstration Program apply to architect-engineer services in support of 
other than military construction projects or military housing objects, 
which otherwise meet criteria at FAR 19.1005(a)(3).
    (b) The targeted industry categories for DoD are:

                                                                        
------------------------------------------------------------------------
                                                                   SIC  
            Standard industrial classification (SIC)               Code 
------------------------------------------------------------------------
(1) Pharmaceutical preparations................................     2834
(2) Ammunition, except for small arms..........................     3483
(3) Ordnance and accessories, not elsewhere classified.........     3489
(4) Turbines and turbine generator sets........................     3511
(5) Aircraft engines and engine parts..........................     3724
(6) Guided missiles and space vehicles.........................     3761
(7) Space vehicle equipment, NEC...............................     3769
(8) Tanks and tank components..................................     3795
(9) Search and navigation equipment............................     3812
(10) Communication services, NEC...............................     4899

[[Page 135]]

                                                                        
------------------------------------------------------------------------

[56 FR 36353, July 31, 1991, as amended at 59 FR 27670, May 27, 1994; 62 
FR 34122, June 24, 1997]



219.1006  Procedures.

    (b)(1) During the period when small business set-asides cannot be 
considered for acquisitions in the four designated industry groups--
    (A) The restrictions at 219.502-2-70(b) (1) and (2) do not apply and 
the acquisitions shall be considered for small disadvantaged business 
set-asides; and
    (B) The evaluation preference at 219.70 shall not be used. However, 
note the test program at 219.72 for construction acquisitions.
    (2) The Director, Small and Disadvantaged Business Utilization, 
Office of the Deputy Under Secretary of Defense (International & 
Commercial Programs), will determine whether reinstatement of small 
business set-asides are necessary to meet the agency goal and will 
recommend reinstatement to the Director, Defense Procurement. Military 
departments and defense agencies shall not reinstate small business set-
asides unless directed by the Director, Defense Procurement.
    (d) Reporting requirements are at 204.670-9.
[58 FR 28466, May 13, 1993, as amended at 61 FR 18687, Apr. 29, 1996; 62 
FR 34122, June 24, 1997]



219.1007  Solicitation provisions.

    Do not use the clause at 252.219-7006, Notice of Evaluation 
Preference for Small Disadvantaged Business Concerns, in solicitations 
or contracts for the four designated industry groups.
[56 FR 36353, July 31, 1991, as amended at 57 FR 42630, Sept. 15, 1992]



 Subpart 219.70--Evaluation Preference for Small Disadvantaged Business 
                             (SDB) Concerns



219.7000  Policy.

    Offers from small disadvantaged business concerns shall be given an 
evaluation preference in accordance with this subpart.



219.7001  Applicability.

    (a) The evaluation preference shall be used in competitive 
acquisitions except as provided in paragraph (b) of this section and in 
219.1006(b)(1)(B).
    (b) Do not use the evaluation preference in acquisitions which--
    (1) Use small purchase procedures;
    (2) Are set-aside for small disadvantaged businesses;
    (3) Are set-aside for small businesses;
    (4) Are for commissary or exchange resale; or
    (5) Are for long distance telecommunications services.
[56 FR 36353, July 31, 1991, as amended at 60 FR 43563, Aug. 22, 1995; 
61 FR 18687, Apr. 29, 1996]



219.7002  Procedures.

    (a) Give offers from small disadvantaged business concerns a 
preference in evaluation by adding a factor of ten percent to the price 
of all offers, except--
    (1) Offers from small disadvantaged business concerns, which have 
not waived the evaluation preference;
    (2) Offers from historically black colleges and universities or 
minority institutions, which have not waived the evaluation preference;
    (3) Otherwise successful offers of--
    (i) Eligible products under the Trade Agreements Act when the 
acquisition equals or exceeds the dollar threshold in FAR 25.402; or
    (ii) Qualifying country end products (see the definition in 
225.101); and
    (4) Offers where application of the factor would be inconsistent 
with a Memorandum of Understanding or other international agreement with 
a foreign government.
    (b) Apply the factor on a line item by line item basis or apply it 
to any group of items on which award may be made. Add other evaluation 
factors such as transportation costs or rent-free use of Government 
facilities to the offers before applying the ten percent factor.
    (c) Do not evaluate offers using the preference when it would cause 
award to be made at a price which exceeds fair market price by more than 
ten percent.
    (d) In partial small business set-asides, use the evaluation 
preference procedures set forth in the clause at

[[Page 136]]

252.219-7001, Notice of Partial Small Business Set-Aside with 
Preferential Consideration for Small Disadvantaged Business Concerns, 
instead of the procedures in paragraphs (a) through (c) of this section.



219.7003  Solicitation provisions and contract clauses.

    Use the clause at 252.219-7006, Notice of Evaluation Preference for 
Small Disadvantaged Business Concerns, in solicitations and contracts 
involving the evaluation preference, except those which include the 
clause at 252.219-7001, Notice of Partial Small Business Set-Aside with 
Preferential Consideration for Small Disadvantaged Business Concerns. 
Use the clause with its Alternate I when the contracting officer 
determines that there are no small disadvantaged business manufacturers 
that can meet the requirements of the solicitation.



              Subpart 219.71--Pilot Mentor-Protege Program

    Source:  59 FR 27670, May 27, 1994, unless otherwise noted.



219.7100  Scope.

    This subpart implements the Pilot Mentor-Protege Program established 
under section 831 of the National Defense Authorization Act for Fiscal 
Year 1991, Public Law 101-510, as amended. The purpose of the Program is 
to provide incentives for DoD contractors to assist small disadvantaged 
businesses in enhancing their capabilities and to increase participation 
of such firms in Government and commercial contracts. Qualified 
organizations employing the severely disabled, as defined in section 
8064A of Public Law 102-172, are also eligible to participate as protege 
firms.



219.7101  Policy.

    DoD policy and procedures for implementation of the Program are 
contained in appendix I to chapter 2, Policy and Procedures for the DoD 
Pilot Mentor-Protege Program.



219.7102  General.

    The Program includes--
    (a) Mentor firms, which are prime contractors with at least one 
active subcontracting plan negotiated under FAR subpart 19.7.
    (b) Protege firms, which are small disadvantaged business (SDB) 
concerns or qualified organizations employing the severely disabled, 
eligible for receipt of Federal contracts and selected by the mentor 
firm.
    (c) Mentor-protege agreements, which establish a developmental 
assistance program for a protege firm.
    (d) Incentives, which may be provided to mentor firms by the DoD 
including:
    (1) Reimbursement for developmental assistance costs through--
    (i) A separate contract;
    (ii) A separately priced contract line item on a DoD contract; or
    (iii) Inclusion of program cost in indirect expense pools.
    (2) Credit toward SDB subcontracting goals, established under a 
subcontracting plan negotiated under FAR subpart 19.7, for developmental 
assistance costs which are either reimbursed through indirect expense 
pools or are not reimbursed; or
    (3) A combination of reimbursement and credit.



219.7103  Procedures.



219.7103-1  General.

    The procedures for application, acceptance, and participation in the 
program are in appendix I to chapter 2, Policy and Procedures for the 
DoD Pilot Mentor-Protege Program. The Director of Small and 
Disadvantaged Business Utilization, Office of the Under Secretary of 
Defense (Acquisition and Technology) approves contractors as mentor 
firms, approves mentor-protege agreements, and forwards approved mentor-
protege agreements to the contracting officer when program funding is 
available through a DoD Program Manager.



219.7103-2  Contracting officer responsibilities.

    Contracting officers shall--
    (a) Negotiate an advance agreement on the treatment of developmental 
assistance costs for credit, reimbursement, or both, if the mentor firm 
proposes such an agreement, or delegate

[[Page 137]]

authority to negotiate to the administrative contracting officer (see 
FAR 31.109).
    (b) Modify (without consideration) applicable contract(s) to 
incorporate the clause at 252.232-7005, Reimbursement of Subcontractor 
Advance Payments-DoD Pilot Mentor-Protege Program, when advance payments 
are provided by a mentor firm to a protege firm under the Program and 
the mentor firm requests reimbursement of advance payments.
    (c) Modify (without consideration) applicable contract(s) to 
incorporate other than customary progress payments for small 
disadvantaged businesses in accordance with FAR 32.504(c) if such 
payments are provided by a mentor firm to a protege firm and the mentor 
firm requests reimbursement.
    (d) Modify applicable contract(s) to establish a contract line item 
for reimbursement of developmental assistance costs--
    (1) When funds have been made available for that purpose by a DoD 
program manager; and
    (2) The contractor has an approved mentor-protege agreement.
    (e) Advise contractors of reporting requirements in appendix I to 
chapter 2.



219.7104  Developmental assistance costs eligible for reimbursement or credit.

    (a) Developmental assistance provided under an approved mentor-
protege agreement is distinct from, and shall not duplicate, any effort 
that is the normal and expected product of the award and administration 
of the mentor firm's subcontracts. Costs associated with the latter 
shall be accumulated and charged in accordance with the contractor's 
approved accounting practices. Mentor firm costs which are eligible for 
reimbursement are set forth in appendix I to chapter 2.
    (b) Before incurring any costs under the Program, mentor firms need 
to establish the accounting treatment of developmental assistance costs 
eligible for reimbursement or credit. Advance agreements are encouraged. 
To be eligible for reimbursement under the Program, costs must be 
incurred before October 1, 1999.
    (c) If the mentor firm is suspended or debarred while performing 
under an approved mentor-protege agreement, the mentor firm may not be 
reimbursed or credited for developmental assistance costs incurred more 
than 30 days after the imposition of the suspension or debarment.
    (d) Developmental assistance costs, incurred by a mentor firm before 
October 1, 1999, that are eligible for crediting under the Program may 
be credited towards subcontracting plan goals as set forth in appendix I 
to chapter 2.
[59 FR 27670, May 27, 1994, as amended at 61 FR 54346, Oct. 18, 1996]



219.7105  Reporting.

    Mentor firms shall report on the progress made under active mentor-
protege agreements semi-annually as indicated in section I-111 of 
appendix I to chapter 2.



 Subpart 219.72--Evaluation Preference for Small Disadvantaged Business 
        (SDB) Concerns in Construction Acquisitions--Test Program

    Source:  61 FR 18688, Apr. 29, 1996, unless otherwise noted.



219.7200  Policy.

    DoD policy is to ensure that, during this test program, offers from 
small disadvantaged business (SDB) concerns shall be given an evaluation 
preference in construction acquisitions.



219.7201  Administration of the test program.

    The test program will be conducted over a 36-month period. The test 
program will be conducted by all DoD contracting activities that award 
construction contracts. The focal point for the test program is the 
Director, Small and Disadvantaged Business Utilization (SADBU), Office 
of the Deputy Under Secretary of Defense (International and Commercial 
Programs). The military departments and defense agencies shall submit 
status reports to the Director, SADBU. The first status report shall be 
submitted 18 months after initiation of the test program;

[[Page 138]]

the second status report shall be submitted 36 months after initiation 
of the test program. These reports shall specify the impact of the 
evaluation preference over each of the reporting periods of the test 
program, and shall provide recommendations with respect to continuation 
and/or modification of the evaluation preference.
[61 FR 18688, Apr. 29, 1996, as amended at 61 FR 50452, Sept. 26, 1996]



219.7202  Applicability.

    (a) The evaluation preference shall be used in competitive 
acquisitions for construction (see definition in FAR Subpart 36.1) when 
work 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.
    (b) Do not use the evaluation preference in acquisitions which--
    (1) Are less than or equal to the simplified acquisition threshold;
    (2) Are set aside for small businesses; or
    (3) Are awarded under section 8(a) procedures.
    (c) The evaluation preference need not be applied when the head of 
the contracting activity determines that the evaluation preference is 
having a disproportionate impact on non-SDB concerns or nondisadvantaged 
small business concerns.



219.7203  Procedures.

    (a) Solicitations that require bonding shall require offerors to 
separately state bond costs in the offer. Bond costs include the costs 
of bid, performance, and payment bonds.
    (b) Evaluate total offers. If the apparently successful offeror is 
an SDB concern, no preference-based evaluation is required under this 
subpart.
    (c) If the apparently successful offeror is not an SDB concern, 
evaluate offers excluding bond costs. If, after excluding bond costs, 
the apparently successful offeror is an SDB concern, add bond costs back 
to all offers, and give offers from SDB concerns a preference in 
evaluation by adding a factor of 10 percent to the total price of all 
offers, except--
    (1) Offers from SDBs which have not waived the evaluation 
preference; and
    (2) Offers from historically black colleges and universities or 
minority institutions, which have not waived the evaluation preference.
    (d) When using the procedures in 236.303-70, Additive or deductive 
items, the evaluation preference in this subpart shall be applied.



219.7204  Contract clause.

    Use the clause at 252.219-7008, Notice of Evaluation Preference for 
Small Disadvantaged Business Concerns--Construction Acquisitions--Test 
Program, in all solicitations--
    (1) That involve the evaluation preference of this subpart; and
    (2) Where work 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.



PART 222--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS--Table of Contents




Sec.
222.001  Definition.

                   Subpart 222.1--Basic Labor Policies

222.101  Labor relations.
222.101-1  General.
222.101-3  Reporting labor disputes.
222.101-3  -70  Impact of labor disputes on defense programs.
222.101-4  Removal of items from contractors' facilities affected by 
          work stoppages.
222.101-70  Acquisition of stevedoring services during labor disputes.
222.102  Federal and State labor requirements.
222.102-1  Policy.
222.103  Overtime.
222.103-4  Approvals.

       Subpart 222.3--Contract Work Hours and Safety Standards Act

222.302  Liquidated damages and overtime pay.

   Subpart 222.4--Labor Standards for Contracts Involving Construction

222.402  Applicability.
222.402-70  Installation support contracts.
222.403  Statutory and regulatory requirements.
222.403-4  Department of Labor regulations.

[[Page 139]]

222.404  Davis-Bacon Act wage determinations.
222.404-2  General requirements.
222.404-3  Procedures for requesting wage determinations.
222.404-11  Wage determination appeals.
222.406  Administration and enforcement.
222.406-1  Policy.
222.406-6  Payrolls and statements.
222.406-8  Investigations.
222.406-9  Withholding from or suspension of contract payments.
222.406-10  Disposition of disputes concerning construction contract 
          labor standards enforcement.
222.406-13  Semiannual enforcement reports.
222.407  Contract clauses.

            Subpart 222.6--Walsh-Healey Public Contracts Act

222.604  Exemptions.
222.604-2  Regulatory exemptions.
222.608  Procedures.
222.608-4  Award pending final determination.

               Subpart 222.8--Equal Employment Opportunity

222.804  Affirmative action programs.
222.804-2  Construction.
222.805  Procedures.
222.806  Inquiries.
222.807  Exemptions.

        Subpart 222.10--Service Contract Act of 1965, as Amended

222.1003  Applicability.
222.1003-1  General.
222.1003-7  Questions concerning applicability of the Act.
222.1008  Procedures for preparing and submitting notice (SF 98/98a).
222.1008-2  Preparation of SF 98a.
222.1008-7  Required time of submission of Notice.
222.1014  Delay of acquisition dates over 60 days.

        Subpart 222.13--Special Disabled and Vietnam Era Veterans

222.1303  Waivers.
222.1306  Complaint procedures.
222.1308  Contract clauses.

              Subpart 222.14--Employment of the Handicapped

222.1403  Waivers.
222.1406  Complaint procedures.

Subpart 222.70--Restrictions on the Employment of Personnel for Work on 
           Construction/Service Contracts in Alaska and Hawaii

222.7000  Scope of subpart.
222.7001  General.
222.7002  Waivers.
222.7003  Contract clause.

          Subpart 222.71--Right of First Refusal of Employment

222.7100  Scope of subpart.
222.7101  Policy.
222.7102  Contract clause.

    Subpart 222.72--Compliance with Labor Laws of Foreign Governments

222.7200  Scope of subpart.
222.7201  Contract clauses.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36358, July 31, 1991, unless otherwise noted.



222.001  Definition.

    Labor advisor, as used in this part, means the departmental or 
agency headquarters labor advisor.



                   Subpart 222.1--Basic Labor Policies



222.101  Labor relations.



222.101-1  General.

    (a) Contracting offices shall--
    (i) Obtain departmental approval before contacting a national office 
of a labor organization, a Government agency headquarters, or any other 
organization on a labor relations matter;
    (ii) Notify departmental headquarters as required in departmental 
procedures when contacted by the national office of any labor 
organization or Government agency headquarters;
    (iii) Obtain the approval of the agency head on major policy 
decisions regarding labor relations matters such as recommendations for 
plant seizure or injunctive action relating to potential or actual work 
stoppages; and
    (iv) Submit questions involving FAR part 22 or other contractor 
labor relations matters to the labor advisor.

[[Page 140]]



222.101-3  Reporting labor disputes.

    The contract administration office shall--
    (1) Notify the labor advisor, the contracting officer, and the head 
of the contracting activity when interference is likely;
    (2) Disseminate information on labor disputes in accordance with 
departmental procedures; and
    (3) File an initial labor dispute report using DD Form 1507, Work 
Stoppage Report, when a work stoppage is imminent or when a work 
stoppage occurs. File a follow-up report when a significant change 
occurs in the dispute. This reporting requirement is assigned Report 
Control Symbol DD-ACQ (AR) 1153.
[56 FR 36358, July 31, 1991, as amended at 56 FR 67215, Dec. 30, 1991; 
59 FR 27671, May 27, 1994]



222.101-3-70  Impact of labor disputes on defense programs.

    (a) Each department and agency shall determine the degree of impact 
of potential or actual labor disputes on its own programs and 
requirements. In making these determinations, consider, for example--
    (1) Whether the dispute involves a product, project (including 
construction), or service which must be obtained in order to meet 
schedules for urgently needed military programs or requirements; and
    (2) Whether alternative sources of supply for the product, project, 
or service are reasonably available to fulfill the requirement or 
program in time to maintain essential military schedules.
    (b) Each contracting activity involved shall obtain and develop data 
reflecting the impact of a labor dispute on its requirements and 
programs. Upon determining the impact, the head of the contracting 
activity shall submit a report of findings and recommendations to the 
labor advisor. The report must be in narrative form and include--
    (1) Location of dispute and name of contractor or subcontractor 
involved;
    (2) A description of the impact, including how the specific items or 
services affect the specific programs or requirements;
    (3) Identity of alternate sources available to furnish the supply or 
service within the time required; and
    (4) A description of any action taken to reduce the impact.
    (c) The head of the contracting activity shall submit impact reports 
to the agency head when--
    (1) Specifically requested; or
    (2) The department or agency considers the impact to be of 
sufficient urgency to warrant the attention of the agency head.
    (d) The labor advisor will expand the report submitted under 
paragraph (c) of this subsection by addressing the following, as 
appropriate--
    (1) Description of military program, project, or service. Identify 
item, project, or service which will be or is being affected by the work 
stoppage. Describe its normal use and current functions in combat, 
combat support, or deterrent operations. For components or raw 
materials, identify the end item(s) for which they are used.
    (2) Requirements and assets. Identify requirements and assets in 
appropriate detail in terms commonly used by the DoD component.
    (i) For production programs, include requirements for each using 
military service. Where applicable, state in detail production schedule, 
inventory objectives, assets against these objectives, and critical 
shortages. For spares and highly expendable items, such as ground and 
air ammunition, show usage (consumption) rates and assets in absolute 
terms and in terms of daily, weekly, or monthly supplies. For 
components, include requirements for spares.
    (ii) For projects, describe the potential adverse effects of a delay 
in meeting schedules, and its impact on the national security.
    (iii) For services, describe how a loss or interruption affects the 
ability to support Defense operations in terms of traffic requirements, 
assets, testing programs, etc.
    (3) Possible measures to minimize strike impact. Describe--
    (i) Capabilities, if any, to substitute items or to use alternate 
sources and indicate the number of other facilities available and the 
relative capabilities

[[Page 141]]

of such facilities in meeting total requirements;
    (ii) How much time would be required to replace the loss of the 
facilities or service affected by a work stoppage; and
    (iii) The feasibility of transferring assets from theater to theater 
to relieve deficits in some areas of urgency.
    (4) Conclusion. (i) Describe the impact on operations of a 15-30, 
30-60, and a 60-90 day work stoppage.
    (ii) Project the degree of criticality of a program, project, or 
service resulting from a work stoppage on a calendar basis, indicating 
the increased impact, if any, as the stoppage lengthens. Criticality is 
measured by the number of days required for the work stoppage to have an 
effect on operational capability. This time must be stated in terms of 
days.



222.101-4  Removal of items from contractors' facilities affected by work stoppages.

    (a) When a contractor is unable to deliver urgent and critical items 
because of a work stoppage at its facility, the contracting officer, 
before removing any items from the facility, shall--
    (i) Before initiating any action, contact the labor advisor to 
obtain the opinion of the national office of the Federal Mediation and 
Conciliation Service or other mediation agency regarding the effect 
movement of the items would have on labor negotiations. Normally 
removals will not be made if they will adversely affect labor 
negotiations.
    (ii) Upon the recommendation of the labor advisor, provide a written 
request for removal of the material to the cognizant contract 
administration office. Include the following information in the 
request--
    (A) Contract number;
    (B) A statement as to the urgency and criticality of the item 
needed;
    (C) A description of the items to be moved (nature of the item, 
amount, approximate weight and cubic feet, item number, etc.);
    (D) Mode of transportation by which the items are to be moved, if 
different than in the contract, and whether by Government or commercial 
bill of lading; and
    (E) Destination of the material, if different from that specified in 
the contract.
    (iii) With the assistance of the labor advisor or the commander of 
the contract administration office, attempt to have both the management 
and the labor representatives involved agree to shipment of the material 
by normal means.
    (iv) If agreement for removal of the needed items cannot be reached 
following the procedures in paragraphs (a) (i) through (iii) of this 
subsection, the commander of the contract administration office, after 
obtaining approval from the labor advisor, may seek the concurrence of 
the parties to the dispute to permit movement of the material by 
military vehicles with military personnel. On receipt of such 
concurrences, the commander may proceed to make necessary arrangements 
to move the material.
    (v) If agreement for removal of the needed items cannot be reached 
following any of the procedures in paragraphs (a) (i) through (iv) of 
this subsection, refer the matter to the labor advisor with the 
information required by 222.101-3-70(b). If the labor advisor is 
unsuccessful in obtaining concurrence of the parties for the movement of 
the material and further action to obtain the material is deemed 
necessary, refer the matter to the agency head. Upon review and 
verification that the items are urgently or critically needed and cannot 
be moved with the consent of the parties, the agency head, on a 
nondelegable basis, may order removal of the items from the facility.



222.101-70  Acquisition of stevedoring services during labor disputes.

    (a) Use the following procedures only in the order listed when a 
labor dispute delays performance of a contract for stevedoring services 
which are urgently needed.
    (1) Attempt to have management and labor voluntarily agree to exempt 
military supplies from the labor dispute by continuing the movement of 
such material.
    (2) Divert vessels to alternate ports able to provide necessary 
stevedoring services.

[[Page 142]]

    (3) Consider contracting with reliable alternative sources of supply 
within the stevedoring industry.
    (4) Utilize civil service stevedores to perform the work performed 
by contract stevedores.
    (5) Utilize military personnel to handle the cargo which was being 
handled by contract stevedores prior to the labor dispute.
    (b) Notify the labor advisor when a deviation from the procedures in 
paragraph (a) of this subsection is required.



222.102  Federal and State labor requirements.



222.102-1  Policy.

    (1) The Department of Labor is responsible for the administration 
and enforcement of the Occupational Safety and Health Act (OSHA). 
Contracting officers shall--
    (i) Direct all inquiries from contractors or contractor employees 
regarding the applicability or interpretation of the OSHA regulations to 
the Department of Labor; and
    (ii) Upon request, provide the address of the appropriate field 
office of the Occupational Safety and Health Administration of the 
Department of Labor.
    (2) Do not initiate any application for the suspension or relaxation 
of labor requirements without prior coordination with the labor advisor.



222.103  Overtime.



222.103-4  Approvals.

    (a) The department/agency approving official shall--
    (i) Obtain the concurrence of other appropriate approving officials; 
and
    (ii) Seek agreement as to the contracts under which overtime 
premiums will be approved when--
    (A) Two or more contracting offices have current contracts at the 
same contractor facility; and
    (B) The approval of overtime by one contracting office will affect 
the performance or cost of contracts of another office. In the absence 
of evidence to the contrary, a contracting officer may rely on a 
contractor's statement that approval of overtime premium pay for one 
contract will not affect performance or payments under any other 
contract.



       Subpart 222.3--Contract Work Hours and Safety Standards Act



222.302  Liquidated damages and overtime pay.

    Upon receipt of notification of Contract Work Hours and Safety 
Standards Act violations, the contracting officer shall--
    (1) Immediately withhold such funds as are available;
    (2) Give the contractor written notification of the withholding and 
a statement of the basis for the liquidated damages assessment. The 
written notification shall also inform the contractor of its 60 days 
right to appeal the assessment, through the contracting officer, to the 
agency official responsible for acting on such appeals; and
    (3) If funds available for withholding are insufficient to cover 
liquidated damages, ask the contractor to pay voluntarily such funds as 
are necessary to cover the total liquidated damage assessment.
    (d)(i) The assessment shall become the final administrative 
determination of contractor liability for liquidated damages when--
    (A) The contractor fails to appeal to the contracting agency within 
60 days from the date of the withholding of funds;
    (B) The department agency, following the contractor's appeals, 
issues a final order which affirms the assessment of liquidated damages 
or waives damages of $500 or less; or
    (C) The Secretary of Labor takes final action on a recommendation of 
the agency head to waive or adjust liquidated damages in excess of $500.
    (ii) Upon final administrative determination of the contractor's 
liability for liquidated damages, the contracting officer shall transmit 
withheld or collected funds determined to be owed the Government as 
liquidated damages to the servicing finance and accounting officer for 
crediting to the appropriate Government Treasury account. The 
contracting officer shall return any excess withheld funds to the 
contractor.

[[Page 143]]



   Subpart 222.4--Labor Standards for Contracts Involving Construction



222.402  Applicability.



222.402-70  Installation support contracts.

    (a) Apply both the Service Contract Act (SCA) and the Davis-Bacon 
Act (DBA) to installation support contracts if--
    (1) The contract is principally for services but also requires a 
substantial and segregable amount of construction, alteration, 
renovation, painting, or repair work; and
    (2) The aggregate dollar value of such construction work exceeds or 
is expected to exceed $2,000.
    (b) SCA coverage under the contract. Contract installation support 
requirements, such as plant operation and installation services (i.e., 
custodial, snow removal, etc.) are subject to the SCA. Apply SCA clauses 
and minimum wage and fringe benefit requirements to all contract service 
calls or orders for such maintenance and support work.
    (c) DBA coverage under the contract. Contract construction, 
alteration, renovation, painting, and repair requirements (i.e., roof 
shingling, building structural repair, paving repairs, etc.) are subject 
to the DBA. Apply DBA clauses and minimum wage requirements to all 
contract service calls or orders for construction, alteration, 
renovation, painting, or repairs to buildings or other works.
    (d) Repairs versus maintenance. Some contract work may be 
characterized as either DBA painting/repairs or SCA maintenance. For 
example, replacing broken windows, spot painting, or minor patching of a 
wall could be covered by either the DBA or the SCA. In those instances 
where a contract service call or order requires construction trade 
skills (i.e., carpenter, plumber, painter, etc.), but it is unclear 
whether the work required is SCA maintenance or DBA painting/repairs, 
apply the following rules--
    (1) Individual service calls or orders which will require a total of 
32 or more work-hours to perform shall be considered to be repair work 
subject to the DBA.
    (2) Individual service calls or orders which will require less than 
32 work-hours to perform shall be considered to be maintenance subject 
to the SCA.
    (3) Painting work of 200 square feet or more to be performed under 
an individual service call or order shall be considered to be subject to 
the DBA regardless of the total work-hours required.
    (e) The determination of labor standards application shall be made 
at the time the solicitation is prepared in those cases where 
requirements can be identified. Otherwise, the determination shall be 
made at the time the service call or order is placed against the 
contract. The service call or order shall identify the labor standards 
law and contract wage determination which will apply to the work 
required.
    (f) Contracting officers may not avoid application of the DBA by 
splitting individual tasks between orders or contracts.



222.403  Statutory and regulatory requirements.



222.403-4  Department of Labor regulations.

    Direct all questions regarding Department of Labor regulations to 
the labor advisor.



222.404  Davis-Bacon Act wage determinations.

    Not later than April 1 of each year, each department and agency 
shall furnish the Administrator, Wage and Hour Division, with a general 
outline of its proposed construction program for the coming fiscal year. 
The Department of Labor uses this information to determine where general 
wage determination surveys will be conducted.
    (1) Indicate by individual project of $500,000 or more--
    (i) The anticipated type of construction;
    (ii) The estimated dollar value; and
    (iii) The location in which the work is to be performed (city, town, 
village, county, or other civil subdivision of the state).
    (2) The report format is contained in Department of Labor All Agency 
Memo 144, December 27, 1985.
    (3) The report control number is 1671-DOL-AN.

[[Page 144]]



222.404-2  General requirements.

    (c)(5) Information concerning the proper application of wage rate 
schedules to the type or types of construction involved shall be 
obtained from the appropriate district commander, Corps of Engineers, 
for the Army; from the cognizant Naval Facilities Engineering Command 
division for the Navy; from the appropriate Regional Industrial 
Relations Office for the Air Force; and from the appropriate Defense 
Contract Management District, ATTN: Industrial Labor Relations Office, 
for the Defense Logistics Agency.



222.404-3  Procedures for requesting wage determinations.

    (b) Requests for project wage determinations. Submit requests for 
project wage determinations directly to the Department of Labor.



222.404-11  Wage determination appeals.

    Send a copy of a petition for review filed by the contracting agency 
to the labor advisor.



222.406  Administration and enforcement.



222.406-1  Policy.

    (a) General. The program shall also include--
    (i) Training appropriate contract administration, labor relations, 
inspection, and other labor standards enforcement personnel in their 
responsibilities; and
    (ii) Periodic review of field enforcement activities to ensure 
compliance with applicable regulations and instructions.
    (b) Preconstruction letters and conferences. (1) Promptly after 
award of the contract, the contracting officer shall provide a 
preconstruction letter to the prime contractor. This letter should 
accomplish the following, as appropriate--
    (A) Indicate that the labor standards requirements contained in the 
contract are based on the following statutes and regulations--
    (1) Davis-Bacon Act;
    (2) Contract Work Hours and Safety Standards Act;
    (3) Copeland (Anti-Kickback) Act;
    (4) Parts 3 and 5 of the Secretary of Labor's Regulations (parts 3 
and 5, subtitle A, title 29, CFR); and
    (5) Executive Order 11246 (Equal Employment Opportunity);
    (B) Call attention to the labor standards requirements in the 
contract which relate to--
    (1) Employment of foremen, laborers, mechanics, and others;
    (2) Wages and fringe benefits payments, payrolls, and statements;
    (3) Differentiation between subcontractors and suppliers;
    (4) Additional classifications;
    (5) Benefits to be realized by contractors and subcontractors in 
keeping complete work records;
    (6) Penalties and sanctions for violations of the labor standards 
provisions; and
    (7) The applicable provisions of FAR 22.403; and
    (C) Ensure that the contractor sends a copy of the preconstruction 
letter to each subcontractor.
    (2) Before construction begins, the contracting officer shall confer 
with the prime contractor and any subcontractor designated by the prime 
to emphasize their labor standards obligations under the contract when--
    (A) The prime contractor has not performed previous Government 
contracts;
    (B) The prime contractor experienced difficulty in complying with 
labor standards requirements on previous contracts; or
    (C) It is necessary to determine whether the contractor and its 
subcontractors intend to pay any required fringe benefits in the manner 
specified in the wage determination or to elect a different method of 
payment. If the latter, inform the contractor of the requirements of FAR 
22.406-2.



222.406-6  Payrolls and statements.

    (a) Submission. Contractors who do not use Department of Labor Form 
WH 347 or its equivalent must submit a DD Form 879, Statement of 
Compliance, with each payroll report.



222.406-8  Investigations.

    (a) The following guidance and procedures apply to investigations 
conducted by the contracting activity. (i)

[[Page 145]]

Beginning of the investigation. The investigator shall--
    (A) Inform the contractor of the investigation in advance;
    (B) Verify the exact legal name of the contractor, its address, and 
the names and titles of its principal officers;
    (C) Outline the general scope of the investigation and that it 
includes examining pertinent records and interviewing employees; and
    (D) Inform the contractor that the names of the employees to be 
interviewed will not be divulged to the contractor;
    (E) When requested, provide a letter from the contracting officer 
verifying the investigator's authority.
    (ii) Conduct of the investigation--(A) Review of the contract.
    (1) Verify that all required labor standards and clauses and the 
wage determination are included in the contract.
    (2) Review the following items in the contract file, if applicable--
    (i) List of subcontractors;
    (ii) Payroll statements for the contractor and subcontractors;
    (iii) Approvals of additional classifications;
    (iv) Data regarding apprentices and trainees as required by FAR 
22.406-4;
    (v) Daily inspector's report or other inspection reports;
    (vi) Employee interview statements; and
    (vii) SF 1413, Statement and Acknowledgement.
    (B) Interview of the complainant. Interview the complainant except 
when this is impractical. The interview shall cover all aspects of the 
complaint to ensure that all pertinent information is obtained. Whenever 
an investigation does not include an interview of the complainant, 
explain such omission in the investigator's report.
    (C) Interview of employees and former employees. (1) Interview a 
sufficient number of employees or former employees, who represent all 
classifications, to develop information regarding the method and amount 
of payments, deductions, hours worked, and the type of work performed.
    (2) Interview employees at the job site if the interviews can be 
conducted privately and in such a manner so as to cause the least 
inconvenience to the employer and employees.
    (3) Former employees may be interviewed elsewhere.
    (4) Do not disclose to any employee any information, finding, 
recommendation, or conclusion relating to the investigation except to 
the extent necessary to obtain required information.
    (5) Do not disclose any employee's statement to anyone, except a 
Government representative working on the case, without the employee's 
written permission.
    (6) Obtain information by mail when personal interviews are 
impractical.
    (7) Use SF 1445, Labor Standards Interview, for employee interviews.
    (8) Request employees to sign their statements and to initial any 
changes.
    (9) Provide an evaluation of each employee's credibility.
    (D) Interview of foremen. Interview foremen to obtain information 
concerning the contractor's compliance with the labor standards 
provisions with respect to employees under the foreman's supervision and 
the correctness of the foreman's classification as a supervisory 
employee. All procedures established for the conduct of employee 
interviews, and the recording and use of information obtained, apply to 
foremen interviews.
    (E) Interview of the contractor. (1) Interview the contractor 
whenever the investigation indicates the possibility of a violation.
    (2) Inform the contractor that--
    (i) The interview does not mean that a violation has been found or 
that a requirement for corrective action exists; and
    (ii) The purpose of the interview is to obtain only such data as the 
contractor may desire to present in connection with the investigation.
    (3) Do not disclose the identity of any individual who filed a 
complaint or was interviewed.
    (F) Review of contractor and subcontractor records. (1) Review 
contractor and subcontractor records such as basic time cards, books, 
cancelled payroll checks, fringe benefits, and payment records. Compare 
them with submitted payrolls. When discrepancies are found, include 
pertinent excerpts or

[[Page 146]]

copies of the records in the investigation report with a statement of 
the discrepancy and any explanation the investigator obtains. When wages 
include contributions or anticipated costs for fringe payments requiring 
approval of the Secretary of Labor, examine the contractor records to 
ensure such approval has been obtained and that any requirements 
specified in the approval have been met. (See FAR 22.406-2(a)(3)).
    (2) Review contractor's and subcontractor's weekly payrolls and 
payroll statements for completeness and accuracy regarding the 
following--
    (i) Identification of employees, payroll amount, the contract, 
contractor, subcontractor, and payroll period;
    (ii) Inclusion of only job classifications and wage rates specified 
in the contract specifications, or otherwise established for the 
contract or subcontract;
    (iii) Computation of daily and weekly hours;
    (iv) Computation of time-and-one half for work in excess of 40 hours 
per week in accordance with FAR 22.406-2(c);
    (v) Gross weekly wages;
    (vi) Deductions;
    (vii) Computation of net weekly wages paid to each employee;
    (viii) Ratio of helpers, apprentices, and trainees to laborers and 
mechanics;
    (ix) Apprenticeship and trainee registration and ratios; and
    (x) Computation of fringe benefits payments.
    (3) Transcribe the contractor's records whenever they contain 
information at variance with payrolls or other submitted documents.
    (i) Make the transcriptions in sufficient detail to permit them to 
be used to check computations of restitution and to determine amounts to 
be withheld from the contractor.
    (ii) Follow the form used by the contractor.
    (iii) Place comments or explanations concerning the transcriptions 
on separate memoranda or in the narrative report.
    (iv) Determine whether the wage determination, any modifications of 
the determination, and any additional classifications are posted as 
required.
    (iii) Submission of the report of investigation. The investigator 
shall submit a report of the investigation in accordance with agency 
procedures. Each report shall include at least the--
    (A) Basis for the investigation, including the name of the 
complainant;
    (B) Names and addresses of prime contractors and subcontractors 
involved, and names and titles of their principal officers;
    (C) Contract number, date, dollar value of prime contract, and date 
and number of wage determination included in the contract;
    (D) Description of the contract and subcontract work involved;
    (E) Summary of the findings with respect to each of the items listed 
in 222.406-8(a)(ii);
    (F) Concluding statement concerning--
    (1) The types of violations, including the amount of kickbacks under 
the Copeland Act, underpayments of basic hourly rates and fringe 
benefits under the Davis-Bacon Act, or underpayments and liquidated 
damages under the Contract Work Hours and Safety Standards Act;
    (2) Whether violations are considered to be willful or due to the 
negligence of the contractor or its agent;
    (3) The amount of funds withheld from the contractor; and
    (4) Other violations found.
    (G) Exhibits indexed and appropriately tabbed, including copies of 
the following, when applicable--
    (1) Complaint letter;
    (2) Contract wage determination;
    (3) Preconstruction letter and memorandum of preconstruction 
conference;
    (4) Payrolls and statements indicating violations;
    (5) Transcripts of pertinent records of the contractor, and 
approvals of fringe benefit payments;
    (6) Employee interview statements;
    (7) Foreman interview statements;
    (8) Statements of others interviewed, including Government 
personnel;
    (9) Detailed computations showing kickbacks, underpayments, and 
liquidated damages;
    (10) Summary of all payments due to each employee or to a fund plan 
or program, and liquidated damages; and
    (11) Receipts and cancelled checks.

[[Page 147]]

    (c) Notification to the contractor.
    (4)(A) Notify the contractor by certified mail of any finding that 
it is liable for liquidated damages under the Contract Work Hours and 
Safety Standards Act (CWHSSA). The notification shall inform the 
contractor that--
    (1) It has 60 days after receipt of the notice to appeal the 
assessment of liquidated damages; and
    (2) The appeal must demonstrate either that the alleged violations 
did not occur at all, occurred inadvertently notwithstanding the 
exercise of due care, or the assessment was computed improperly.
    (B) If an appeal is received, the contracting officer shall process 
the appeal in accordance with department or agency regulations.
    (d) Contracting officer's report. (1) In accordance with agency 
procedures, the contracting officer shall forward a detailed enforcement 
report or summary report in duplicate. These reports shall include at 
least the following--
    (A) SF 1446, Labor Standards Investigation Summary Sheet;
    (B) Contracting officer's findings;
    (C) Statement as to the disposition of any contractor rebuttal to 
the findings;
    (D) Statement as to whether the contractor has accepted the findings 
and has paid any restitution or liquidated damages;
    (E) Statement as to the disposition of funds available;
    (F) Recommendations as to disposition or further handling of the 
case (when appropriate, include recommendations as to the reduction, 
waiver, or assessment of liquidated damages, whether the contractor 
should be debarred, and whether the file should be referred for possible 
criminal prosecution); and
    (G) When applicable the following exhibits--
    (1) Investigator's report;
    (2) Copy of the contractor's written rebuttal or a summary of the 
contractor's oral rebuttal of the contracting officer's findings;
    (3) Copies of correspondence between the contractor and contracting 
officer, including a statement of specific violations found, corrective 
action requested, and the contractor's letter of acceptance or 
rejection;
    (4) Evidence of the contractor's payment of restitution or 
liquidated damages. (Copies of receipts, canceled checks, or 
supplemental payrolls); and
    (5) Letter from the contractor requesting relief from the liquidated 
damage provisions of the CWHSSA.



222.406-9  Withholding from or suspension of contract payments.

    (a) Withholding from contract payments. The contracting officer 
shall contact the labor advisor for assistance when payments due a 
contractor are not available to satisfy that contractor's liability for 
Davis-Bacon or CWHSSA wage underpayments or liquidated damages.
    (c) Disposition of contract payments withheld or suspended.
    (3) Limitation on forwarding or returning funds. When disposition of 
withheld funds remains the final action necessary to close out a 
contract, the Department of Labor has given blanket approval to forward 
withheld funds to the Comptroller General pending completion of an 
investigation or other administrative proceedings.
    (4) Liquidated damages.
    (A) The agency head may adjust liquidated damages of $500 or less 
when the amount assessed is incorrect or waive the assessment when the 
violations--
    (1) Were nonwillful or inadvertent; and
    (2) Occurred notwithstanding the exercise of due care by the 
contractor, its subcontractor, or their agents.
    (B) The agency head may recommend to the Administrator, Wage and 
Hour Division, that the liquidated damages over $500 be adjusted because 
the amount assessed is incorrect. The agency head may also recommend the 
assessment be waived when the violations--
    (1) Were nonwillful or inadvertent; and
    (2) Occurred notwithstanding the exercise of due care by the 
contractor, the subcontractor, or their agents.

[[Page 148]]



222.406-10  Disposition of disputes concerning construction contract labor standards enforcement.

    (d) Forward the contracting officer's findings and the contractor's 
statement through the labor advisor.



222.406-13  Semiannual enforcement reports.

    Forward these reports through the head of the contracting activity 
to the labor advisor within 15 days following the end of the reporting 
period. These reports shall not include information from investigations 
conducted by the Department of Labor. These reports shall contain the 
following information, as applicable, for construction work subject to 
the Davis-Bacon Act and the CWHSSA--
    (1) Period covered;
    (2) Number of prime contracts awarded;
    (3) Total dollar amount of prime contracts awarded;
    (4) Number of contractors/subcontractors against whom complaints 
were received;
    (5) Number of investigations conducted;
    (6) Number of contractors/subcontractors found in violation;
    (7) Amount of wage restitution found due under--
    (i) Davis-Bacon Act
    (ii) CWHSSA;
    (8) Number of employees due wage restitution under--
    (i) Davis-Bacon Act
    (ii) CWHSSA;
    (9) Amount of liquidated damages assessed under the CWHSSA--
    (i) Total amount
    (ii) Number of contracts involved;
    (10) Number of employees and amount paid/withheld under--
    (i) Davis-Bacon Act
    (ii) CWHSSA
    (iii) Copeland Act; and
    (11) Preconstruction activities--
    (i) Number of compliance checks performed
    (ii) Preconstruction letters sent.



222.407  Contract clauses.

    In contracts with a State or political subdivision, use the contract 
clauses prescribed in FAR 22.407, but preface these clauses with the 
following--

    The Contractor agrees to comply with the requirements of the 
Contract Work Hours and Safety Standards Act and to insert the following 
clauses in all subcontracts under this contract with private persons or 
firms.



            Subpart 222.6--Walsh-Healey Public Contracts Act



222.604  Exemptions.



222.604-2  Regulatory exemptions.

    (c) Submit all applications for such exemptions through contracting 
channels to the labor advisor.



222.608  Procedures.



222.608-4  Award pending final determination.

    (b)(1) The head of the contracting activity is the approval 
authority for the contracting officer's certification.



               Subpart 222.8--Equal Employment Opportunity



222.804  Affirmative action programs.



222.804-2  Construction.

    (b) Contracting officers forward requests for instructions directly 
to the servicing Office of Federal Contract Compliance Programs (OFCCP) 
regional office (see FAR 22.609).



222.805  Procedures.

    (a)(2) See FAR 22.609 for a list of OFCCP regional offices.



222.806  Inquiries.

    (b) Refer inquiries through the labor advisor.



222.807  Exemptions.

    (c) Submit the request for exemption with a justification through 
contracting channels to the labor advisor who will forward them to the 
agency head. If the request is submitted under FAR 22.807(a)(1), the 
agency head shall act on the request. If the exemption is granted, the 
agency head shall notify the Director, OFCCP of such action within 30 
days. If the request is submitted under FAR 22.807(a)(2) or (b)(5), the 
agency head will forward it to the Director, OFCCP for action.

[[Page 149]]



        Subpart 222.10--Service Contract Act of 1965, as Amended



222.1003  Applicability.



222.1003-1  General.

    For contracts having a substantial amount of construction, 
alteration, renovation, painting, or repair work, see 222.402-70.



222.1003-7  Questions concerning applicability of the Act.

    Contracting officers may contact the labor advisor by telephone for 
informal advice. Submit requests for formal determinations as to the 
Act's applicability to the labor advisor in writing through appropriate 
channels.



222.1008  Procedures for preparing and submitting Notice (SF 98/98a).



222.1008-2  Preparation of SF 98a.

    (b)(1) The contracting officer shall secure the assistance of 
cognizant customer/technical personnel to ensure maximum use of the 
Service Contract Act Directory of Occupations (Directory) and 
incorporation of all service employee classes (Directory and 
nondirectory) expected to be utilized.
    (2)(A) When the statement of work job title, for which there is a 
Directory equivalent, differs from the Directory job title, make a 
written cross-reference either directly on the SF 98a file copy or on an 
attached sheet to the SF 98a file copy.
    (B) Include and note as such any classifications and minimum hourly 
wage rates conformed under any predecessor contract. Where a previously 
conformed classification is not included in the Directory, attach the 
job description to the SF 98a.



222.1008-7  Required time of submission of notice.

    (d) Submit requests for immediate wage determination responses for 
emergency acquisitions through the labor advisor. If the request is 
justified, the labor advisor will contact Department of Labor 
headquarters officials.



222.1014  Delay of acquisition dates over 60 days.

    Send update requests in writing directly to the Wage and Hour 
Division and provide a copy to the labor advisor. The update request 
shall--
    (1) State that one or more dates on the original notice have been 
delayed more than 60 days;
    (2) List the new dates; and
    (3) Include a copy of the original notice and SF 98a as enclosures.



        Subpart 222.13--Special Disabled and Vietnam Era Veterans



222.1303  Waivers.

    (c) The contracting officer shall submit a waiver request through 
contracting channels to the labor advisor. If the request is justified, 
the labor advisor will endorse the request and forward it for action 
to--
    (i) The agency head for waivers under FAR 22.1303(a); or
    (ii) The Secretary of Defense, without the power of redelegation, 
for waivers under FAR 22.1303(b).



222.1306  Complaint procedures.

    The contracting officer shall--
    (1) Forward each complaint received as indicated in FAR 22.1306; and
    (2) Notify the complainant of the referral. The contractor in 
question shall not be advised in any manner or for any reason of the 
complainant's name, the nature of the complaint, or the fact that the 
complaint was received.



222.1308  Contract clauses.

    (a)(1) Use of the clause at FAR 52.222-35, Affirmative Action for 
Special Disabled and Vietnam Era Veterans, with its paragraph (c), 
Listing Openings, also satisfies the requirement of 10 U.S.C. 2410d.
[58 FR 28466, May 13, 1993]



              Subpart 222.14--Employment of the Handicapped



222.1403  Waivers.

    (c) The contracting officer shall submit a waiver request through 
contracting channels to the labor advisor. If the request is justified, 
the labor advisor

[[Page 150]]

will endorse the request and forward it for action to--
    (i) The agency head for waivers under FAR 22.1403(a). For the 
defense agencies, waivers must be approved by the Under Secretary of 
Defense for Acquisition.
    (ii) The Secretary of Defense, without the power of redelegation, 
for waivers under FAR 22.1403(b).



222.1406  Complaint procedures.

    The contracting officer shall--
    (1) Forward each complaint received as indicated in FAR 22.1406 (see 
FAR 22.609 for a listing of Department of Labor regional/area offices); 
and
    (2) Notify the complainant of such referral. The contractor in 
question shall not be advised in any manner or for any reason of the 
complainant's name, the nature of the complaint, or the fact that the 
complaint was received.



Subpart 222.70--Restrictions on the Employment of Personnel for Work on 
           Construction/Service Contracts in Alaska and Hawaii



222.7000  Scope of subpart.

    (a) This subpart implements section 8078 of the 1986 Defense 
Appropriations Act, Public Law 99-190, and similar sections in 
subsequent Defense Appropriations Acts.
    (b) This subpart applies only--
    (1) To construction and service contracts to be performed in whole 
or in part within the states of Alaska or Hawaii; and
    (2) When the unemployment rate in the state is in excess of the 
national average rate of unemployment as determined by the Secretary of 
Labor.
[56 FR 36358, July 31, 1991, as amended at 57 FR 14993, Apr. 23, 1992]



222.7001  General.

    A contractor awarded a contract subject to this subpart must employ 
for the purpose of performing that portion of the contract work within 
the state, individuals who are residents of that state, and who, in the 
case of any craft or trade, possess or would be able to acquire promptly 
the necessary skills to perform the contract.



222.7002  Waivers.

    Waivers may be granted, in the interest of national security, at a 
level no lower than the Assistant Secretary of any department.



222.7003  Contract clause.

    Use the clause at 252.222-7000, Restrictions on Employment of 
Personnel, in all solicitations and contracts subject to this subpart.



          Subpart 222.71--Right of First Refusal of Employment

    Source:  57 FR 52593, Nov. 4, 1992, unless otherwise noted.



222.7100  Scope of subpart.

    This subpart prescribes policies and procedures for use in 
acquisitions arising from closure of military installations.



222.7101  Policy.

    (a) DoD policy is to minimize the adverse impact on civil service 
employees affected by the closure of military installations. One means 
of implementing this policy is to give employees adversely affected by 
closure of a military installation the right of first refusal for jobs 
created by award of contracts arising from the closure effort that the 
employee is qualified to fill.
    (b) Closure efforts include the acquisitions for preparing the 
installation for closure (such as environmental restoration and 
utilities modification) and maintaining the property after closure (such 
as security and fire prevention services).



222.7102  Contract clause

    Use the clause at 252.222-7001, Right of First Refusal of 
Employment--Closure of Military Installations, in all solicitations and 
contracts arising from the closure of the military installation where 
the contract will be performed.

[[Page 151]]



    Subpart 222.72--Compliance with Labor Laws of Foreign Governments



222.7200  Scope of subpart.

    This subpart prescribes contract clauses, with respect to labor laws 
of foreign governments, for use when contracting for services or 
construction within a foreign country.
[62 FR 34122, June 24, 1997]



222.7201  Contract clauses.

    (a) Use the clause at 252.222-7002, Compliance with Local Labor Laws 
(Overseas), in solicitations and contracts for services or construction 
to be performed outside the United States, its possessions, and Puerto 
Rico.
    (b) Use the clause at 252.222-7003, Permit from Italian Inspectorate 
of Labor, in solicitations and contracts for porter, janitorial, or 
ordinary facility and equipment maintenance services to be performed in 
Italy.
    (c) Use the clause at 252.222-7004, Compliance with Spanish Social 
Security Laws and Regulations, in solicitations and contracts for 
services or construction to be performed in Spain.
[62 FR 34122, June 24, 1997]



PART 223--ENVIRONMENT, CONSERVATION, OCCUPATIONAL SAFETY, AND DRUG-FREE WORKPLACE--Table of Contents




Sec.

        Subpart 223.1--Pollution Control and Clean Air and Water

223.104  Exemptions.

  Subpart 223.3--Hazardous Material Identification and Material Safety 
                                  Data

223.300  Scope of subpart.
223.302  General.
223.303  Contract clause.
223.370  Safety precautions for ammunition and explosives.
223.370-1  Scope.
223.370-2  Definition.
223.370-3  Policy.
223.370-4  Procedures.
223.370-5  Contract clauses.

                Subpart 223.4--Use of Recovered Materials

223.404  Procedures.

                   Subpart 223.5--Drug-Free Workplace

223.570  Drug-free work force.
223.570-1  Definitions.
223.570-2  Policy.
223.570-3  General.
223.570-4  Contract clause.

                Subpart 223.8--Ozone-Depleting Substances

223.803  Policy.

                Subpart 223.70--Hazardous Waste Disposal

223.7000  Scope of subpart.
223.7001  Definitions.
223.7002  Contract clause.

  Subpart 223.71--Storage and Disposal of Toxic and Hazardous Materials

223.7100  Policy.
223.7101  Procedures.
223.7102  Exceptions.
223.7103  Contract clause.

 Subpart 223.72--Safeguarding Sensitive Conventional Arms, Ammunition, 
                             and Explosives

223.7200  Definition.
223.7201  Policy.
223.7202  Preaward responsibilities.
223.7203  Contract clause.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36365, July 31, 1991, unless otherwise noted.



        Subpart 223.1--Pollution Control and Clean Air and Water



223.104  Exemptions.

    (c) The authority to act for the agency head under this subpart is 
limited to a level no lower than an official who is appointed by and 
with the advice of the Senate. For the defense agencies, this is the 
Under Secretary of Defense (Acquisition and Technology).
[60 FR 61596, Nov. 30, 1995]

[[Page 152]]



  Subpart 223.3--Hazardous Material Identification and Material Safety 
                                  Data



223.300  Scope of subpart.

    DoD procedures for use in acquisitions involving ammunition and 
explosives are in 223.370.



223.302  General.

    (b) Successful offerors are also required to submit hazard warning 
labels under the clause at 252.223-7001, Hazard Warning Labels.
    (e) The contracting officer shall also provide hazard warning labels 
received from apparent successful offerors to the cognizant safety 
officer or other designated official in order to facilitate--
    (i) Inclusion of relevant data in the department/agency's material 
safety data sheet information system or label information system; and
    (ii) Other control, safety, or information purposes.
[56 FR 67215, Dec. 30, 1991]



223.303  Contract clause.

    Use the clause at 252.223-7001, Hazard Warning Labels, in 
solicitations and contracts which require submission of hazardous 
material data sheets (see FAR 23.302(c)).
[56 FR 67215, Dec. 30, 1991]



223.370  Safety precautions for ammunition and explosives.



223.370-1  Scope.

    (a) This section applies to all acquisitions involving the use of 
ammunition and explosives, including acquisitions for--
    (1) Development;
    (2) Testing;
    (3) Research;
    (4) Manufacturing;
    (5) Handling or loading;
    (6) Assembling;
    (7) Packaging;
    (8) Storage;
    (9) Transportation;
    (10) Renovation;
    (11) Demilitarization;
    (12) Modification;
    (13) Repair;
    (14) Disposal;
    (15) Inspection; or
    (16) Any other use, including acquisitions requiring the use or the 
incorporation of materials listed in paragraph (b) of this subsection 
for initiation, propulsion, or detonation as an integral or component 
part of an explosive, an ammunition, or explosive end item or weapon 
system.
    (b) This section does not apply to acquisitions solely for--
    (1) Inert components containing no explosives, propellants, or 
pyrotechnics;
    (2) Flammable liquids;
    (3) Acids;
    (4) Oxidizers;
    (5) Powdered metals; or
    (6) Other materials having fire or explosive characteristics.



223.370-2  Definition.

    Ammunition and explosives, as used in this section, is defined in 
the clause at 252.223-7002, Safety Precautions for Ammunition and 
Explosives.



223.370-3  Policy.

    (a) DoD policy is to ensure that its contractors take reasonable 
precautions in handling ammunition and explosives so as to minimize the 
potential for mishaps that could--
    (1) Interrupt DoD operations;
    (2) Delay project or product completion dates;
    (3) Adversely impact DoD mission readiness, production base, or 
production capabilities;
    (4) Damage or destroy DoD property; or
    (5) Cause injury to DoD personnel.
    (b) This policy is implemented by DoD Manual 4145.26-M, DoD 
Contractors' Safety Manual for Ammunition and Explosives, which is 
incorporated into contracts under which ammunition and explosives are 
handled. The manual contains mandatory safety requirements for 
contractors. When work is to be performed on a Government-owned 
installation, the contracting officer may use the ammunition and 
explosives regulation of the DoD component or installation as a 
substitute for, or supplement to, DoD Manual 4145.26-M, as long as the 
contract cites these regulations.

[[Page 153]]



223.370-4  Procedures.

    (a) Preaward phase--(1) Waiver of the mandatory requirements. (i) 
Before either omitting the clause at 252.223-7002, Safety Precautions 
for Ammunition and Explosives, from solicitations and contracts or 
waiving the mandatory requirements of the manual, obtain approval of--
    (A) The safety personnel responsible for ammunition and explosives 
safety; and
    (B) The head of the contracting activity.
    (ii) If the contracting officer decides to waive the mandatory 
requirements before award, the contracting officer shall set forth in 
the solicitation, or in an amendment of the solicitation, the specific 
requirements to be waived.
    (iii) If the head of the contracting activity declines to approve a 
request for waiver, but the prospective contractor agrees to take 
corrective action to bring the operation into compliance, make the 
corrective action a part of the resulting contract.
    (2) Transportation considerations--If shipment of ammunition and 
explosives is involved in the contract, address in the schedule of the 
contract the applicable Department of Transportation or Military Traffic 
Management Command requirements and any other requirements for 
transportation, packaging, marking, and labeling.
    (3) Disposition of excess--Include instructions within the contract 
concerning final disposition of excess Government furnished material 
containing ammunition and explosives, including defective or rejected 
supplies.
    (4) Preaward survey--Before awarding any contract, including 
purchase orders, involving ammunition and explosives, obtain a preaward 
ammunition and explosives safety survey. If the prospective contractor 
proposes subcontracting any ammunitions or explosive work, include a 
review of the subcontractor's facility in the preaward survey.
    (b) Postaward phase--(1) Contract administration office 
responsibility. (i) The contract administration office is responsible 
for verifying that the safety requirements of the clause at 252.223-

7002, Safety Precautions for Ammunition and Explosives, are being 
implemented in a manner that will reduce, to the maximum extent 
practicable, or eliminate the probability of a mishap occurring.
    (ii) The clause at 252.223-7002, Safety Precautions for Ammunition 
and Explosives, requires the contractor to submit to the administrative 
contracting officer (ACO) any postaward requests for a waiver of the 
contract safety standards, a site plan modification, or a construction 
review. The ACO shall review any request and make recommendations to the 
contracting officer. The contracting officer shall make a decision after 
considering recommendations of the ACO and safety personnel responsible 
for ammunition and explosive safety.
    (A) If the request arrives at the contracting office without 
evidence that the ACO has seen it, immediately send it to the ACO for 
review and recommendations.
    (B) When the contracting officer has made a determination approving 
or disapproving the contractor's request, send the determination to the 
ACO for transmission to the contractor.
    (2) Subcontracts--(i) The clause at 252.223-7002, Safety Precautions 
for Ammunition and Explosives, requires the contractor to notify the 
contracting officer when placing a subcontract for ammunition and 
explosives. The contracting officer should coordinate with the safety 
personnel and request supporting contract administration in accordance 
with FAR 42.204. If the contracting officer believes the nature of the 
subcontract work poses a potential danger to Government property, 
Government personnel, production capability, or contract completion, 
request supporting contract administration.
    (ii) If the preaward safety survey identified areas in which a 
subcontractor was not complying with the manual, and the subcontractor 
was supposed to correct the deficiencies before start-up, the 
contracting officer shall require a preoperations survey to verify that 
the corrections were made.
    (iii) When postaward safety reviews by the Government uncover any 
safety deficiencies in the subcontractor's operation, the review team 
shall inform

[[Page 154]]

the ACO cognizant of the subcontractor, who shall immediately notify the 
ACO cognizant of the prime contractor. The ACO cognizant of the prime 
shall inform the prime contractor of deficiencies requiring correction. 
The notifications shall be made by the most expeditious means 
appropriate to the circumstance. If a critical safety deficiency poses 
an imminent danger, the ACO cognizant of the prime shall make the 
notifications by the most expeditious means available.
[56 FR 36365, July 31, 1991, as amended at 59 FR 27671, May 27, 1994]



223.370-5  Contract clauses.

    Use the clauses at 252.223-7002, Safety Precautions for Ammunition 
and Explosives, and 252.223-7003, Change in Place of Performance--
Ammunition and Explosives, in all solicitations and contracts for 
acquisition to which this section applies.



                Subpart 223.4--Use of Recovered Materials



223.404  Procedures.

    (b)(3) A contract for an EPA designated item which does not meet the 
EPA or agency minimum recovered material standards shall not be awarded 
before approval of the written determination required by FAR 
23.404(b)(3). The approving official shall be--
    (A) A general or flag officer, or a member of the Senior Executive 
Service, of the requiring activity; or
    (B) For requiring activities without a general or flag officer or 
member of the Senior Executive Service, the commander of the activity.
    (4) Annual contractor certifications shall be submitted for 
consolidation and reporting in accordance with department/agency 
procedures.
[60 FR 61596, Nov. 30, 1995]



                   Subpart 223.5--Drug-Free Workplace

    Source:  57 FR 32737, July 23, 1992, unless otherwise noted.



223.570  Drug-free work force.



223.570-1  Definitions.

    Employee in a sensitive position and illegal drugs, as used in this 
section, are defined in the clause at 252.223-7004, Drug-Free Work 
Force.



223.570-2  Policy.

    DoD policy is to ensure that its contractors maintain a program for 
achieving a drug-free work force.



223.570-3  General.

    (a) The use of illegal drugs is inconsistent with the law-abiding 
behavior expected of all citizens. Employees who use illegal drugs tend 
to be less productive, less reliable, and prone to greater absenteeism. 
The use of illegal drugs by contractor employees results in the 
potential for increased cost, delay, and risk in the performance of a 
Government contract.
    (b) If a contractor's employees use illegal drugs at any time, it 
can--
    (1) Impair their ability to perform tasks that are critical to 
proper contract performance;
    (2) Increase the potential for accidents and for failures that can 
pose a serious threat to the national security, health, and safety;
    (3) Cause less than the complete reliability, stability, and good 
judgment required of an individual who has access to sensitive 
information;
    (4) Create the possibility of coercion, influence, and irresponsible 
action under pressure that may post a serious risk to national security, 
health, and safety.



223.570-4  Contract clause.

    (a) Use the clause at 252.223-7004, Drug-Free Work Force, in all 
solicitations and contracts--
    (1) That involve access to classified information; or
    (2) When the contracting officer determines that the clause is 
necessary for reasons of national security or for the purpose of 
protecting the health or safety of those using or affected by the 
product of, or performance of, the contract.
    (b) Do not use the clause in solicitations and contracts for--
    (1) Commercial items; or

[[Page 155]]

    (2) Performance or partial performance outside the United States, 
its territories, and possessions, unless the contracting officer 
determines such inclusion to be in the best interest of the Government.
[57 FR 32737, July 23, 1992, as amended at 60 FR 61597, Nov. 30, 1995]



                Subpart 223.8--Ozone-Depleting Substances



223.803  Policy.

    Section 211.271, Elimination of use of class I ozone-depleting 
substances, places restrictions on award or modification of DoD 
contracts requiring the use of class I ozone-depleting substances. These 
restrictions are in addition to any imposed by the Clean Air Act and 
apply after June 1, 1993, to all DoD contracts, regardless of place of 
performance.
[61 FR 50452, Sept. 26, 1996]



                Subpart 223.70--Hazardous Waste Disposal



223.7000  Scope of subpart.

    This subpart implements section 331 of the Defense Authorization Act 
for Fiscal Year 1992 (Pub. L. 102-190) and similar sections in 
subsequent Defense authorization acts.
[58 FR 28466, May 13, 1993]



223.7001  Definitions.

    As used in this subpart--
    (a) Remedial action has the meaning given that term by section 
101(24) of the Comprehensive Environmental Response, Compensation, and 
Liability Act of 1980 (42 U.S.C. 9601(24)).
    (b) Corrective action has the meaning given that term under section 
3004(u) of the Solid Waste Disposal Act (42 U.S.C. 6924(u)).
[57 FR 14993, Apr. 23, 1992]



223.7002  Contract clause.

    (a) Use the clause at 252.223-7005, Hazardous Waste Liability, in 
all solicitations and contracts for the offsite treatment or disposal of 
hazardous waste from a facility under the jurisdiction of the Secretary 
of Defense--
    (1) Entered into during or after fiscal year 1992;
    (2) With an owner or operator of a hazardous waste treatment or 
disposal facility.
    (b) The clause at 252.223-7005 does not apply to contracts--
    (1) For performance of remedial action or corrective action under--
    (i) The Defense Environmental Restoration Program;
    (ii) Other programs or activities of the Department of Defense; or
    (iii) Authorized State hazardous waste programs;
    (2) Under which the generation of the hazardous waste to be disposed 
of is incidental to the performance of the contract; or
    (3) For disposition of ammunition or solid rocket motors.
    Use of the clause at 252.223-7005 may be waived if the Secretary of 
Defense or the Secretary of the military department concerned determines 
that--
    (1) There is only one responsible offeror or there is no responsible 
offeror willing to provide the reimbursement required by paragraph (b) 
of the clause; or
    (2) Failure to award the contract would place the facility concerned 
in violation of any requirement of the Solid Waste Disposal Act (42 
U.S.C. 6901 et seq.).
[57 FR 14993, Apr. 23, 1992, as amended at 57 FR 53599, Nov. 12, 1992; 
58 FR 28466, May 13, 1993]



  Subpart 223.71--Storage and Disposal of Toxic and Hazardous Materials

    Source:  58 FR 28466, May 13, 1993, unless otherwise noted.



223.7100  Policy.

    10 U.S.C. 2692 prohibits storage or disposal of non-DoD-owned toxic 
or hazardous materials on DoD installations, except as provided in 
223.7102. DoD Directive 6050.8, Storage and Disposal of Non-DoD-Owned 
Hazardous or Toxic Materials on DoD Installations, implements 10 U.S.C. 
2692.

[[Page 156]]



223.7101  Procedures.

    (a) If the contracting officer is uncertain as to whether particular 
activities are prohibited or fall under one of the exceptions in 
223.7102, the contracting officer should seek advice from the cognizant 
office of counsel.
    (b) When storage, treatment, or disposal of non-DoD-owned toxic or 
hazardous materials is authorized in accordance with this subpart, the 
contract or authorization should specify the types, conditions, and 
quantities of toxic or hazardous materials that may be temporarily 
stored, treated, or disposed of in connection with the contract or as a 
result of the authorized commercial use of a DoD industrial-type 
facility.
[60 FR 61597, Nov. 30, 1995]



223.7102  Exceptions.

    (a) The prohibition of 10 U.S.C. 2692 does not apply to--
    (1) The storage of strategic and critical materials in the National 
Defense Stockpile under an agreement for such storage with the 
Administrator of General Services Administration;
    (2) The temporary storage or disposal of explosives in order to 
protect the public or to assist agencies responsible for Federal law 
enforcement in storing or disposing of explosives when no alternative 
solution is available, if such storage or disposal is made in accordance 
with an agreement between the Secretary of Defense and the head of the 
Federal agency concerned;
    (3) The temporary storage or disposal of explosives in order to 
provide emergency lifesaving assistance to civil authorities;
    (4) The disposal of excess explosives produced under a DoD contract, 
if the head of the military department concerned determines, in each 
case, that an alternative feasible means of disposal is not available to 
the contractor, taking into consideration public safety, available 
resources of the contractor, and national defense production 
requirements;
    (5) The temporary storage of nuclear materials or nonnuclear 
classified materials in accordance with an agreement with the Secretary 
of Energy;
    (6) The storage of materials that constitute military resources 
intended to be used during peacetime civil emergencies in accordance 
with applicable DoD regulations;
    (7) The temporary storage of materials of other Federal agencies in 
order to provide assistance and refuge for commercial carriers of such 
material during a transportation emergency;
    (8) The storage of any material that is not owned by DoD, if the 
Secretary of the military department concerned determines that the 
material is required or generated by a private person in connection with 
the authorized and compatible use by that person of an industrial-type 
DoD facility; or
    (9) The treatment and disposal of any non-DoD-owned material if the 
Secretary of the military department concerned--
    (i) Determines that the material is required or generated by a 
private person in connection with the authorized and compatible 
commercial use by that person of an industrial-type facility of that 
military department; and
    (ii) Enters into a contract with that person that--
    (A) Is consistent with the best interest of national defense and 
environmental security; and
    (B) Provides for that person's continued financial and environmental 
responsibility and liability with regard to the material.
    (b) The Secretary of Defense, where DoD Directive 6050.8 applies, 
may grant exceptions to the prohibition of 10 U.S.C. 2692 when essential 
to protect the health and safety of the public from imminent danger.
[58 FR 28466, May 13, 1993, as amended at 60 FR 13076, Mar. 10, 1995; 60 
FR 61597, Nov. 30, 1995]



223.7103  Contract clause.

    (a) Use the clause at 252.223-7006, Prohibition on Storage and 
Disposal of Toxic and Hazardous Materials, in all solicitations and 
contracts which require, may require, or permit contractor performance 
on a DoD installation.
    (b) Use the clause at 252.223-7006 with its Alternate I, when the 
Secretary of

[[Page 157]]

the military department issues a determination under the exception at 
223.7102(a)(9).
[60 FR 13076, Mar. 10, 1995]



 Subpart 223.72--Safeguarding Sensitive Conventional Arms, Ammunition, 
                             and Explosives

    Source:  61 FR 7743, Feb. 29, 1996, unless otherwise noted.



223.7200  Definition.

    ``Arms, ammunition, and explosives (AA&E),'' as used in this 
subpart, means those items within the scope (chapter 1, paragraph B) of 
DoD 5100.76-M, Physical Security of Sensitive Conventional Arms, 
Ammunition, and Explosives.



223.7201  Policy.

    (a) The requirements of DoD 5100.76-M, Physical Security of 
Sensitive Conventional Arms, Ammunition, and Explosives, shall be 
applied to contracts when--
    (1) AA&E will be provided to the contractor or subcontractor as 
Government-furnished property; or
    (2) The principal development, production, manufacture, or purchase 
of AA&E is for DoD use.
    (b) The requirements of DoD 5100.76-M need not be applied to 
contracts when--
    (1) The AA&E to be acquired under the contract is a commercial item 
within the meaning of FAR 2.101; or
    (2) The contract will be performed in a Government-owned contractor-
operated ammunition production facility. However, if subcontracts issued 
under such a contract will meet the criteria of paragraph (a) of this 
section, the requirements of DoD 5100.76-M shall apply.



223.7202  Preaward responsibilities.

    When an acquisition involves AA&E, technical or requirements 
personnel shall specify in the purchase request--
    (a) That AA&E is involved; and
    (b) Which physical security requirements of DoD 5100.76-M apply.



223.7203  Contract clause.

    Use the clause at 252.223-7007, Safeguarding Sensitive Conventional 
Arms, Ammunition, and Explosives, in all solicitations and contracts to 
which DoD 5100.76-M applies, in accordance with the policy at 223.7201. 
Complete paragraph (b) of the clause based on information provided by 
cognizant technical or requirements personnel.
[61 FR 7743, Feb. 29, 1996; 61 FR 18195, Apr. 24, 1996]



PART 224--PROTECTION OF PRIVACY AND FREEDOM OF INFORMATION--Table of Contents




Sec.

             Subpart 224.1--Protection of Individual Privacy

224.102  General.
224.103  Procedures.

                Subpart 224.2--Freedom of Information Act

224.203  Policy.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36367, July 31, 1991, unless otherwise noted.



             Subpart 224.1--Protection of Individual Privacy



224.102  General.

    The Act does not apply to--
    (1) Systems of records the contractor maintains on its employees; or
    (2) The records generated by a State or private educational 
organization under a contract with the Government to provide training, 
when the records (admission forms, grade reports) are similar to and 
commingled with those maintained on other students.



224.103  Procedures.

    (b)(2) DoD rules and regulations are contained in DoDD 5400.11, 
Department of Defense Privacy Program, and DoD 5400.11-R, Department of 
Defense Privacy Program.

[[Page 158]]



                Subpart 224.2--Freedom of Information Act



224.203  Policy.

    (a) DoD implementation is in DoDD 5400.7, DoD Freedom of Information 
Act Program, and DoD 5400.7-R, DoD Freedom of Information Act Program.
[56 FR 36367, July 31, 1991. Redesignated at 62 FR 34122, June 24, 1997]



PART 225--FOREIGN ACQUISITION--Table of Contents




Sec.
225.000  Scope of part.
225.000-70  Definitions.
225.000-71  General guidelines.

                Subpart 225.1--Buy American Act--Supplies

225.102  Policy.
225.103  Agreements with certain foreign governments.
225.105  Evaluating offers.
225.107  Acquisition from or through other Government agencies.
225.108  Excepted articles, materials, and supplies.
225.109  Solicitation provisions and contract clauses.
225.109-70  Additional provisions and clauses.

         Subpart 225.2--Buy American Act--Construction Materials

225.202  Policy.

               Subpart 225.3--Balance of Payments Program

225.302  Policy.
225.303  Procedures.
225.305  Solicitation provision and contract clause.
225.305-70  Additional clause.

     Subpart 225.4--Purchase Under the Trade Agreements Act of 1979

225.401  Definitions.
225.402  Policy.
225.403  Exceptions.
225.403-70  Products subject to trade agreement acts.
225.405  Procedures.
225.408  Solicitation provisions and contract clauses.

                    Subpart 225.6--Customs and Duties

225.602  Policy.
225.603  Procedures.
225.604  Exempted supplies.
225.605  Contract clause.
225.605-70  Additional solicitation provisions and contract clauses.

        Subpart 225.7--Restrictions on Certain Foreign Purchases

225.702  Restrictions.
225.770  Secondary Arab boycott of Israel.
225.770-1  Restriction.
225.770-2  Procedures.
225.770-3  Exceptions.
225.770-4  Waivers
225.770-5  Solicitation provision and contract clause.

        Subpart 225.8--International Agreements and Coordination

225.801  International agreements.
225.802  Procedures.
225.802-70  Contracts for performance outside the United States and 
          Canada.
225.802-71  End user certificates.
225.870  Contracting with Canadian contractors.
225.870-1  General.
225.870-2  Solicitation of Canadian contractors.
225.870-3  Submission of offers.
225.870-4  Contracting procedures.
225.870-5  Contract administration.
225.870-6  Termination procedures.
225.870-7  Acceptance of Canadian supplies.
225.870-8  Industrial security.
225.871  North Atlantic Treaty Organization (NATO) cooperative projects.
225.871-1  Scope.
225.871-2  Definitions.
225.871-3  General.
225.871-4  Statutory waivers.
225.871-5  Directed subcontracting.
225.871-6  Disposal of property.
225.871-7  Congressional notification.
225.872  Contracting with qualifying country sources.
225.872-1  General.
225.872-2  Applicability.
225.872-3  Solicitation procedures.
225.872-4  Evaluation of offers.
225.872-5  Contract administration.
225.872-6  Audit.
225.872-7  Industrial security for qualifying countries.
225.872-8  Subcontracting with qualifying country sources.
225.873  Waiver of United Kingdom commercial exploitation levies.
225.873-1  Policy.
225.873-2  Procedures.
225.873-3  Contract clause.

              225.9--Additional Foreign Acquisition Clauses

225.970  Clause deviations in overseas contracts.
225.971  Correspondence in English.

[[Page 159]]

225.972  Authorization to perform.

   Subpart 225.70--Authorization Acts, Appropriations Acts, and Other 
              Statutory Restrictions on Foreign Acquisition

225.7000  Scope of subpart.
225.7001  Definitions.
225.7002-1  Restrictions.
225.7002-2  Exceptions.
225.7002-3  Contract clauses.
225.7003  Restriction on overseas military construction.
225.7004  Restriction on overseas architect-engineer services.
225.7005  Waiver of certain restrictions.
225.7006  Restrictions on construction or repair of vessels in foreign 
          shipyards.
225.7007  Restriction on acquisition of foreign buses.
225.7007-1  Restriction.
225.7007-2  Applicability.
225.7007-3  Exceptions.
225.7007-4  Waiver.
225.7008  Restriction on research and development.
225.7009  [Reserved]
225.7010  Restriction on certain chemical weapons antidote.
225.7010-1  Restriction.
225.7010-2  Exception.
225.7010-3  Waiver.
225.7011  Restriction on Ballistic Missile Defense research, 
          development, test, and evaluation.
225.7011-1  Definitions.
225.7011-2  Restriction.
225.7011-3  Exceptions.
225.7011-4  Procedures.
225.7011-5  Solicitation provision.
225.7012  Restrictions on anchor and mooring chain.
225.7012-1  Restrictions.
225.7012-2  Waiver.
225.7012-3  Contract clauses.
225.7013--225.7014  [Reserved]
225.7015  Restriction on night vision image intensifier tubes and 
          devices.
225.7015-1  Restriction.
225.7015-2  Exception.
225.7015-3  Contract clause.
225.7016  Restriction on air circuit breakers for naval vessels.
225.7016-1  Restriction.
225.7016-2  Exceptions.
225.7016-3  Waiver.
225.7016-4  Contract clause.
225.7017  Restriction on carbon, alloy, and armor steel plate.
225.7017-1  Restriction.
225.7017-2  Exceptions.
225.7017-3  Waiver.
225.7017-4  Contract clause.
225.7018  Restriction on four ton dolly jacks.
225.7018-1  Restriction.
225.7018-2  Waiver.
225.7018-3  Contract clause.
225.7019  Restrictions on ball and roller bearings.
225.7019-1  Restrictions.
225.7019-2  Exceptions.
225.7019-3  Waiver.
225.7019-4  Contract clause.
225.7020  [Reserved]
225.7021  Restriction on aircraft fuel cells.
225.7021-1  Restriction.
225.7021-2  Waiver.
225.7021-3  Contract clause.
225.7022  Restrictions on totally enclosed lifeboat survival systems.
225.7022-1  Restrictions.
225.7022-2  Exceptions.
225.7022-3  Waiver.
225.7022-4  Contract clause.
225.7023  Restriction on supercomputers.
225.7023-1  Restriction.
225.7023-2  Waiver.
225.7023-3  Contract clause.

        Subpart 225.71--Other Restrictions on Foreign Acquisition

225.7100  Scope of subpart.
225.7101  Definitions.
225.7102  Forgings.
225.7102-1  Policy.
225.7102-2  Exceptions.
225.7102-3  Waiver.
225.7102-4  Contract clause.
225.7103  Polyacrylonitrile (PAN) carbon fiber.
225.7103-1  Policy.
225.7103-2  Waivers.
225.7103-3  Contract clause.

Subpart 225.72--Reporting Contract Performance Outside the United States

225.7200  Scope of subpart.
225.7201  Exception.
225.7202  Distribution of reports.
225.7203  Contract clause.

         Subpart 225.73--Acquisitions for Foreign Military Sales

225.7300  Scope of subpart.
225.7301  General.
225.7302  Procedures.
225.7303  Pricing acquisitions for foreign military sales.
225.7303-1  Contractor sales to other foreign customers.
225.7303-2  Cost of doing business with a foreign government or an 
          international organization.
225.7303-3  Government-to-government agreements.
225.7303-4  Contingent fees.
225.7303-5  Acquisitions wholly paid for from nonrepayable funds.
225.7304  Source selection.
225.7305  Limitation of liability.

[[Page 160]]

225.7306  Exercise of options for foreign military sales.
225.7307  Offset arrangements.
225.7308  Contract clauses.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36367, July 31, 1991, unless otherwise noted.



225.000  Scope of part.

    This part also provides policy and procedures for--
    (1) Purchasing foreign defense supplies, services, and construction 
materials;
    (2) Foreign military sale acquisitions;
    (3) Coordinating acquisitions involving work to be performed in 
foreign countries;
    (4) Cooperative programs.



225.000-70  Definitions.

    As used in this part--
    (a) Defense equipment means any equipment, item of supply, 
component, or end product purchased by the DoD.
    (b) Domestic concern means a concern incorporated in the United 
States or an unincorporated concern having its principal place of 
business in the United States.
    (c) Domestic end product has the meaning given in the clause at 
252.225-7001, Buy American Act and Balance of Payments Program, instead 
of the meaning in FAR 25.101.
    (d) Foreign concern means any concern other than a domestic concern.
    (e) Nondesignated country end product means any end product which is 
not a U.S. made end product or a designated country end product.
    (f) Nonqualifying country means a country other than the United 
States or a qualifying country.
    (g) Nonqualifying country end product means an end product which is 
neither a domestic nor qualifying country end product.
    (h) Nonqualifying country offer means an offer of a nonqualifying 
country end product, including the price of transportation to 
destination.
    (i) Qualifying country is a term used to describe certain countries 
with memoranda of understanding or international agreements with the 
United States. These countries are listed in 225.872-1.
    (j) Qualifying country component and qualifying country end product 
are defined in the clause at 252.225-7001, Buy American Act and Balance 
of Payments Program.
    (k) Qualifying country offer means an offer of a qualifying country 
end product, including the price of transportation to destination.
    (l) Source, when restricted by such words as foreign, domestic, 
qualifying country, etc., refers to the actual manufacturer or producer 
of the end product or component.
    (m) U.S. made end product is defined in the clause at 252.225-7007, 
Trade Agreements.
[56 FR 36367, July 31, 1991, as amended at 59 FR 1289, Jan. 10, 1994]



225.000-71  General guidelines.

    To apply the policies and procedures of this part, analyze and 
evaluate offers of foreign end products generally as follows--
    (a) Statutory or policy restrictions. (1) Determine whether the 
product is restricted by--
    (i) DoD Authorization or Appropriations Acts (see subpart 225.70); 
or
    (ii) DoD policy (see subpart 225.71 and FAR 6.302-3).
    (2) Where an exception to or waiver of a restriction would result in 
award of a foreign end product, apply the policies and procedures of the 
Buy American Act or the Balance of Payments Program, and, if applicable, 
the trade agreements.
    (b) Memoranda of understanding or other international agreements. 
(1) Determine whether the offered product is the product of one of the 
countries (qualifying country), listed in 225.872-1.
    (2) If the product is the product of a qualifying country, evaluate 
the offer under 225.105 and 225.872-4.
    (c) Trade agreements. (1) Determine whether the product is covered 
by the Trade Agreements Act or the North American Free Trade Agreement 
Implementation Act (see subpart 225.4).
    (2) If the product is an eligible product under subpart 225.4, 
evaluate the offer under FAR 25.402 and 225.105.

[[Page 161]]

    (3) If the product is not an eligible product, a qualifying country 
end product, or a U.S. made end product, purchase of the foreign end 
product may be prohibited (see FAR 25.402(c) and 225.402(c)).
    (d) Contractors controlled by terrorist nations. (1) Determine 
whether the contractor is controlled by a terrorist nation.
    (2) If the contractor is controlled by a terrorist nation, comply 
with 209.104-1(g).
    (e) Buy American Act and Balance of Payments Program. See the 
evaluation procedures in 225.105.
[56 FR 36367, July 31, 1991, as amended at 59 FR 1289, Jan. 10, 1994]



                Subpart 225.1--Buy American Act--Supplies



225.102  Policy.

    (a)(2) The cost of a domestic end product is unreasonable if it is 
not the low evaluated offer when evaluated under 225.105.
    (3)(A) Specific public interest exceptions for DoD are in 225.872.
    (B) Normally, use the evaluation procedures in 225.105, but consider 
recommending a public interest exception where the purposes of the Buy 
American Act are not served, or in order to meet a need set forth in 10 
U.S.C. 2533. For example, a public interest exception may be 
appropriate--
    (1) If accepting the low domestic offer will involve substantial 
foreign expenditures, or accepting the low foreign offer will involve 
substantial domestic expenditures;
    (2) To ensure access to advanced state-of-the-art commercial 
technology; or
    (3) To maintain the same source of supply for spare and replacement 
parts (also see paragraph (b)(iii)(B) of this section)--
    (i) For an end item that qualifies as an American good; or
    (ii) In order not to impair integration of the military and 
commercial industrial base.
    (C) A determination whether to grant a public interest exception 
shall be made after consideration of the factors in 10 U.S.C. 2533--
    (1) At a level above the contracting officer for acquisitions valued 
at less than $100,000;
    (2) By the head of the contracting activity for acquisitions valued 
at $100,000 or more but less than $1,000,000; or
    (3) By the agency head for acquisitions valued at $1,000,000 or 
more.
    (b)(i) A determination that an article, material, or supply is not 
reasonably available is required where no domestic offer is received or 
when domestic offers are insufficient to meet the requirement and award 
is to be made on a nonqualifying country end product.
    (ii) Except as provided in FAR 25.102(b)(1), the determination must 
be approved--
    (A) At a level above the contracting officer, if the acquisition is 
estimated not to exceed $25,000;
    (B) By the chief of the contracting office if the acquisition is 
estimated not to exceed $250,000;
    (C) By the head of the contracting activity (HCA) or immediate 
deputy if the acquisition is estimated not to exceed $2 million; or
    (D) By the head of the agency, or designee at a level no lower than 
an HCA, if the acquisition is estimated to exceed $2 million.
    (iii) A determination as to whether an article, material, or supply 
is reasonably available is not required for--
    (A) End products or components listed in 225.108(d)(1) or FAR 
25.108(d)(1);
    (B) Acquisitions for spare/replacement parts when the acquisition is 
restricted to the original manufacturer or supplier; or
    (C) Acquisition of foreign drugs by the Defense Personnel Support 
Center when the Chief of the Technical Operations Division, Directorate 
of Medical Materiel, determines that only the requested foreign drug 
will fulfill the requirements.
    (iv) Under coordinated acquisition (see 208.70), the determination 
is the responsibility of the requiring department when the requiring 
department specifies acquisition of a foreign end product.
[56 FR 36367, July 31, 1991, as amended at 56 FR 67215, Dec. 30, 1991; 
60 FR 34470, July 3, 1995]

[[Page 162]]



225.103  Agreements with certain foreign governments.

    See 225.872.



225.105  Evaluating offers.

    Use the following procedures instead of those in FAR 25.105.
    (1) Evaluate offers by adding a 50 percent factor to the price 
(including duty) of each nonqualifying country offer (see Example 1 in 
Table 25-1, Evaluation).
    (i) Nonqualifying country offers include duty in the offered price. 
When applying the factor, evaluate based on the inclusion of duty, 
whether or not duty is to be exempted. If award is made on the 
nonqualifying country offer and duty is to be exempted through inclusion 
of the clause at FAR 52.225-10, Duty-Free Entry, award at the offered 
price minus the amount of duty identified in the provision at 252.225-
7003, Information for Duty-Free Entry Evaluation. See Example 1, 
Alternate II, in Table 25-1, Evaluation.
    (ii) When a nonqualifying country offer includes more than one line 
item, apply the 50 percent factor--
    (A) On an item-by-item basis; or
    (B) On a group of items, if the solicitation specifically provides 
for award on a group basis.
    (2) When application of the factor would not result in the award of 
a domestic end product, e.g., when no domestic offers are received (see 
Example 3 of Table 25-1, Evaluation) or when a qualifying country offer 
is lower than the domestic offer (see Example 2 of Table 25-1, 
Evaluation), evaluate offers without the 50 percent factor.
    (i) If duty is to be exempted through inclusion of the clause at FAR 
52.225-10, Duty-Free Entry, evaluate the nonqualifying country offer 
exclusive of duty by reducing the offered price by the amount of duty 
identified in the clause at 252.225-7003, Information for Duty-Free 
Entry Evaluation (see Examples 2 and 3, Alternate II, of Table 25-1, 
Evaluation). If award is made on the nonqualifying country offer, award 
at the offered price minus duty.
    (ii) If duty is not to be exempted and duty is to be paid by the 
Government, evaluate the nonqualifying country offer inclusive of duty. 
(See Examples 2 and 3, Alternate I, of Table 25-1, Evaluation.)
    (3) Treat offers of eligible products under acquisitions subject to 
the Trade Agreements Act or NAFTA as if they were qualifying country 
offers. (See Example 4 of Table 25-1, Evaluation.)
    (4) If these evaluation procedures result in a tie between a 
nonqualifying country offer and a domestic offer, make award on the 
domestic offer.
    (5)(i) There are two tests that must be met to determine whether a 
manufactured item is a domestic end product--
    (A) The end product must have been manufactured in the United 
States; and
    (B) The cost of its U.S. and qualifying country components must 
exceed 50 percent of the cost of all of its components. This test is 
applied to end products only, and not to individual components.
    (ii) Because of the component test, the definition of ``domestic end 
product'' is more restrictive than the definition for--
    (A) ``U.S. made end product'' under trade agreements;
    (B) ``Domestically produced or manufactured products'' under small 
business set-asides or small business-small purchase set-asides; and
    (C) Products of small businesses under FAR part 19.
    (iii) If an offer is for a ``U.S. made end product,'' ``domestically 
produced end product,'' or the product of a small business, but is not a 
``domestic end product'' as defined in the clause at 252.225-7001, Buy 
American Act and Balance of Payments Program, treat the offer as a 
nonqualifying country offer. (See Example 4 of Table 25-1, Evaluation.)

                         Table 25-1, Evaluation

                                Example 1

Alternate I: Duty Not Exempted for Nonqualifying Country Offers:
    Nonqualifying Country Offer (including $100 duty)--$6,000
    Domestic Offer--$8,900
    Qualifying Country Offer--$9,100
    Award on Domestic Offer. The 50% evaluation factor is added to the 
nonqualifying country offer, inclusive of duty, yielding an evaluated 
price of $9,000.
Alternate II: Duty Exempted:

[[Page 163]]

    Nonqualifying Country Offer (including $1,000 duty)--$600,000
    Domestic Offer--$910,000
    Qualifying Country Offer--$920,000
    Award on Nonqualifying Country Offer. The addition of the evaluation 
factor yields an evaluated price of $900,000. Since duty is being 
exempted for nonqualifying country offers, the duty is subtracted from 
the offered price which is awarded at $599,000.

                                Example 2

Alternate I: Duty Not Exempted for Nonqualifying Country Offers:
    Nonqualifying Country Offer (including $100 duty)--$6,000
    Domestic Offer--$8,500
    Qualifying Country Offer--$7,800
    Award on Nonqualifying Country Offer. In this case, the application 
of the evaluation factor to the nonqualifying country offer results in a 
price ($9,000) that is higher than the other two offers, but would not 
result in award of a domestic offer, since the qualifying country offer 
is lower. Therefore, all offers are evaluated without the factor. Since 
duty is not being exempted for nonqualifying country offers, the offer 
is evaluated and award is made at the price inclusive of duty ($6,000).
Alternate II: Duty Exempted:
    Nonqualifying Country Offer (including $1,000 duty)--$880,500
    Domestic Offer--$950,000
    Qualifying Country Offer--$880,000
    Award on Nonqualifying Country Offer. Again, the addition of the 
evaluation factor would not result in the award of a domestic offer and 
all offers are evaluated without the factor. Since duty is being 
exempted for nonqualifying country offers, the duty identified by the 
offeror is subtracted from the offered price, which is evaluated and 
awarded at $879,500.

                                Example 3

Alternate I: Duty Not Exempted for Nonqualifying Country Offers:
    Nonqualifying Country Offer (including $1,000 duty)--$10,000
    Qualifying Country Offer--$9,500
    Award on Qualifying Country Offer. Since no domestic offers are 
received, the foreign offers are evaluated without the evaluation 
factor. Since duty is not being exempted and would be paid by the 
Government, the nonqualifying country offer is evaluated inclusive of 
duty.
Alternate II: Duty Exempted:
    Nonqualifying Country Offer (including $1,000 duty)--$880,500
    Qualifying Country Offer--$880,000
    Award on Nonqualifying Country Offer. Since duty is being exempted, 
duty is subtracted from the nonqualifying country offer, which is 
evaluated and awarded at $879,500.

                                Example 4

Alternate I:
    Offer of U.S. Made End Product which is not a Domestic Offer--
$800,000
    Domestic Offer--$820,000
    Eligible Product--$830,000
    Award on Domestic End Product. U.S. made end products which are not 
also domestic end products are evaluated the same as nonqualifying 
country end products. Adding the 50% evaluation factor yields an 
evaluated price of $1,200,000.
Alternate II:
    Offer of U.S. Made End Product which is not a Domestic Offer--
$800,000
    Eligible Product--$820,000
    Domestic Offer--$830,000
    Award on U.S. Made End Product. Adding the 50% evaluation factor to 
the U.S. made end product would not result in the award of a domestic 
end product since the eligible product, which is evaluated the same as a 
qualifying country offer, is lower. All offers are evaluated without the 
factor.
[56 FR 36367, July 31, 1991, as amended at 59 FR 1289, Jan. 10, 1994]



225.107  Acquisition from or through other Government agencies.

    Contracting activities must apply the evaluation procedures in 
225.105 when using Federal supply schedules.



225.108  Excepted articles, materials, and supplies.

    (a)(i)DoD has determined that the articles, materials, and supplies 
listed in FAR 25.108(d)(1) and in paragraph (d)(1) of this section, when 
purchased as end items or components, are not mined, produced, or 
manufactured in the United States in sufficient and reasonably available 
commercial quantities of a satisfactory quality. Regard these items or 
components as being of domestic origin when incorporated in--
    (A) An end product or construction material manufactured in the 
United States; or
    (B) A qualifying country end product or construction material. (For 
construction material, see FAR 25.2.)
    (ii) Scrap is domestic in origin if generated in, collected in, and 
prepared for processing in the United States.
    (d)(1) Aluminum clad steel wire. Sperm oil.

[[Page 164]]



225.109  Solicitation provisions and contract clauses.

    (a) Use the provision at 252.225-7000, Buy American Act--Balance of 
Payments Program Certificate, instead of the provisions at FAR 52.225-1, 
Buy American Certificate, and FAR 52.225-6, Balance of Payments Program 
Certificate. Use the provision in any solicitation which includes the 
clause at 252.225-7001, Buy American Act and Balance of Payments 
Program, unless the solicitation includes either the clause at 252.225-
7007, Trade Agreements Act, or the clause at 252.225-7036, North 
American Free Trade Agreements Implementation Act.
    (b) For oral solicitations inform prospective vendors that only 
domestic and qualifying country end products are acceptable, except 
nonqualifying country end products are acceptable if--
    (i) The items are excepted either on a blanket or an individual 
basis; or
    (ii) The price of the nonqualifying country end product is the low 
offer under the evaluation procedures in 225.105.
    (d) Use the clause at 252.225-7001, Buy American Act and Balance of 
Payments Program, instead of the clauses at FAR 52.225-3, Buy American 
Act-Supplies, and FAR 52.225-7, Balance of Payments Program, in 
solicitations and contracts for supplies or services which require the 
furnishing of supplies.
    (i) Do not use the clause if an exception to the Buy American Act or 
Balance of Payments Program is known to apply.
    (ii) The clause need not be used if nonqualifying country end 
products are ineligible for award, including--
    (A) End products restricted to domestic or domestic and qualifying 
country sources under Appropriations and Authorization Act restrictions 
(see 225.70);
    (B) End products restricted to domestic or domestic and Canadian 
sources (see 225.71); and
    (C) End products restricted under the authority of FAR 6.302-3.
    (iii) The clause may be used if the contracting officer anticipates 
a waiver of the restrictions in paragraphs (d)(ii) (A) or (B) of this 
section.
[56 FR 36367, July 31, 1991, as amended at 57 FR 42630, Sept. 15, 1992; 
59 FR 1289, Jan. 10, 1994]



225.109-70  Additional provisions and clauses.

    (a) Use the clause at 252.225-7002, Qualifying Country Sources as 
Subcontractors, in all solicitations and contracts that include the 
clause at 252.225-7001, Buy American Act and Balance of Payments 
Program.
    (b) Use the provision at 252.225-7003, Information for Duty-Free 
Entry Evaluation, in all solicitations that include the clause at 
252.225-7001, Buy American Act and Balance of Payments Program.
    (c) When only domestic end products are acceptable, the solicitation 
must make a statement to that effect.



         Subpart 225.2--Buy American Act--Construction Materials



225.202  Policy.

    (a)(3) A nonavailability determination is not required for 
construction materials listed in FAR 25.108(d)(1) or in 225.108(d)(1). 
For other materials, a nonavailability determination must be approved at 
the levels specified in 225.102(b)(ii). Use the estimated value of the 
construction materials to determine the approval level.
[56 FR 36367, July 31, 1991, as amended at 62 FR 34122, June 24, 1997]



               Subpart 225.3--Balance of Payments Program



225.302  Policy.

    (a) DoD implements the Balance of Payments Program using evaluation 
factors similar to those which implement the Buy American Act. The 
Balance of Payments Program restrictions--
    (i) Apply to acquisitions for foreign military sales;
    (ii) Do not apply to services, except services which primarily 
involve the acquisition of supplies;
    (iii) Do not apply to qualifying country end products; and

[[Page 165]]

    (iv) Do not apply to articles, materials, or supplies produced or 
manufactured in Panama when purchased by and for the use of U.S. forces 
in Panama.
    (b)(i) Before solicitation, the determinations required by FAR 
25.302(b)(2) and (3), or a determination that the cost of acquiring 
domestic end products or services is unreasonable (FAR 25.303(b)), may 
be made by the following individuals or their immediate deputies--

                                  Army

Deputy Chief of Staff for Procurement, U.S. Army Material Command
Commander-in-Chief, U.S. Army, Europe and DCSLOG, U.S. Army, Europe
Commander, Eighth U.S. Army and Chief of Staff, Eighth U.S. Army
Commander, Corps of Engineers Command
Commander, U.S. Army, Japan
Commander, U.S. Army Medical Research and Development Command
Commander, U.S. Army Forces Command
Commander, U.S. Army, South

                                  Navy

Commander-in-Chief, U.S. Naval Forces, Europe
Commander, U.S. Naval Forces, Japan
Commander, U.S. Naval Forces, Philippines
Commander-in-Chief, U.S. Atlantic Fleet
Commander-in-Chief, U.S. Pacific Fleet
Commander, Military Sealift Command
Commandant, U.S. Marine Corps
Commander, Naval Facilities Engineering Command
Commanding General, III Marine Amphibious Force

                                Air Force

Commander, U.S. Air Forces in Europe
Commander, Pacific Air Force
Commander, Air Mobility Command
Commander, Air Force Materiel Command
Commander, Air Combat Command
Commander, Air Force Space Command

                    Advanced Research Projects Agency

Director, Contracts Management Office

                   Defense Information Systems Agency

Director

                        Defense Logistics Agency

Executive Director, Procurement

                         Defense Mapping Agency

Deputy Director for Acquisition, Installations, and Logistics

           Department of Defense Office of Dependents Schools

Director

                        On-Site Inspection Agency

Principal Deputy Director

    (ii) The authority to make the determinations required by 
225.302(b)(i) may be redelegated below the levels in paragraph (b)(i) 
for acquisitions estimated at $500,000 or less in foreign cost.
    (3)(A) This authority is not intended for use in making repetitive 
supply acquisitions or acquisitions of total annual supply requirements 
of items available in the United States but not available within the 
time required.
    (B) DoD has determined that requirements for the items on the lists 
at FAR 25.108(d)(1) and at 225.108(d)(1) can only be filled by a foreign 
end product.
    (4) DoD has determined the following items can only be acquired or 
performed in the country concerned--
    (A) Maintenance and repair of, and acquisition of spare parts for, 
foreign-manufactured vehicles, equipment, machinery, and systems; 
provided, in the case of spare parts, the acquisition is restricted to 
the original manufacturer or its supplier in accordance with DoD 
standardization policy (see DoD Directive 4120.3, Defense 
Standardization and Specification Program);
    (B) Industrial gases;
    (C) Brand drugs specified by the Defense Medical Materiel Board;
    (D) Bulk construction materials: sand, gravel, and other soil 
materials, stone, concrete masonry units, and fired brick; and
    (E) Overhaul and repair of vessels, aircraft, and vehicles which--
    (1) Are home-ported/stationed/deployed overseas; and
    (2) Cannot practically return to the United States or to U.S. 
operated repair facilities.
    (F) Ready-mixed asphalt and portland cement concrete, provided that 
foreign cost is estimated at not more than $100,000.
    (c)(i) Purchase of materials, equipment, and supplies for 
construction overseas shall generally be the responsibility of the 
contractor performing the work; but where necessary to comply with 
foreign law, to avoid taxation, or to obtain other advantages, consider

[[Page 166]]

direct purchase. Consider savings that may be obtained by exemptions 
from import and other taxes and, to the extent economical, take 
advantage of tax exemptions available under existing agreements.
    (ii) When purchase of materials is the responsibility of the 
construction contractor, the evaluation differential is determined 
through the estimating process and applied before solicitation.
[56 FR 36367, July 31, 1991, as amended at 56 FR 67215, Dec. 30, 1991; 
57 FR 42630, Sept. 15, 1992; 59 FR 27671, May 27, 1994; 60 FR 61597, 
Nov. 30, 1995]



225.303  Procedures.

    (a) Solicitation of offers. When soliciting orally, advise vendors 
that only domestic and qualifying country end products are acceptable 
unless an exception applies or the price of a domestic end product is 
unreasonable.
    (b) Evaluation. (i) Use the evaluation procedures in 225.105 instead 
of the evaluation procedures in FAR 25.303(b). Treatment of duty may 
differ when delivery is overseas.
    (A) Duty may not be applicable to nonqualifying country offers.
    (B) The U.S. Government cannot guarantee the exemption of duty for 
components or end products imported into foreign countries.
    (C) Foreign governments may impose duties, and offers including such 
duties must be evaluated as offered.
    (ii) Where the evaluation procedures in 225.105 result in the award 
of a nonqualifying country end product, the acquisition of domestic end 
products is unreasonable or inconsistent with public interest. If no 
domestic end product offers are received, the determination in FAR 
25.302(b)(3) is not required.



225.305  Solicitation provision and contract clause.



225.305-70  Additional clause.

    In order to allow accurate reporting, by cognizant accounting and 
disbursing officers, of foreign and domestic expenditures, use the 
clause at 252.225-7005, Identification of Expenditures in the United 
States, in all negotiated contracts over $25,000 where--
    (a) For supply contracts, the contract requires end products 
manufactured or produced in the United States; and
    (1) The contractor is a foreign concern; or
    (2) The contractor is a domestic concern and the Government will 
take title outside the United States.
    (b) For contracts for construction, repair, and maintenance of real 
property, or services to be performed outside the United States--
    (1) The contractor is a domestic concern; or
    (2) The contractor is a foreign concern and the contract requires 
acquisition of materials, equipment, or services from U.S. sources.



     Subpart 225.4--Purchases Under the Trade Agreements Act of 1979



225.401  Definitions.

    Caribbean Basin country end product includes petroleum or any 
product derived from petroleum.
    Eligible product means, instead of the definition at FAR 25.401, a 
designated, NAFTA, or Caribbean Basin country end product in the 
categories listed in 225.403.70.
[59 FR 1289, Jan. 10, 1994, as amended at 59 FR 23169, May 5, 1994]



225.402  Policy.

    (a) To estimate the value of the acquisition, use the total 
estimated value of end products subject to trade agreement acts (see 
225.403-70).
    (1) See 225.105 for evaluation of eligible products and U.S. made 
end products.
    (c)(i) Except as provided in paragraphs (c) (ii) and (iii) of this 
section, do not purchase nondesignated country end products subject to 
the Trade Agreements Act unless they are NAFTA, Caribbean Basin, or 
qualifying country end products (see 225.872-1).
    (ii) The prohibition in paragraph (c)(i) of this section does not 
apply when the contracting officer determines that offers of U.S. made, 
qualifying country, or eligible products from responsive, responsible 
offerors are either--
    (A) Not received; or
    (B) Insufficient to fill the Government's requirements. In these 
cases,

[[Page 167]]

accept all responsive, responsible offers of U.S. made, qualifying 
country, and eligible products before accepting any other offers.
    (iii) National interest waivers under Section 302(b)(2) of the Trade 
Agreements Act are approved on a case-by-case basis. Except as delegated 
in paragraphs (c)(iii) (A) and (B) of this section, a request for a 
national interest waiver shall include supporting rationale and be 
submitted under department/agency procedures to the Director of Defense 
Procurement.
    (A) The head of the contracting activity may approve a national 
interest waiver for a purchase by an overseas purchasing activity of 
products critical to the support of U.S. forces stationed abroad. The 
waiver must be supported by a written statement from the requiring 
activity stating that the requirement is critical for the support of 
U.S. forces stationed abroad.
    (B) The Commander, Defense Fuel Supply Center, may approve national 
interest waivers for purchases of fuel for use by U.S. forces overseas.
[56 FR 36367, July 31, 1991, as amended at 59 FR 1289, Jan. 10, 1994; 59 
FR 39974, Aug. 5, 1994; 61 FR 130, Jan. 3, 1996; 61 FR 7744, Feb. 29, 
1996]



225.403  Exceptions.

    (b) The evaluation preference for small disadvantaged businesses in 
subpart 219.70 does not displace an offer of an eligible product.
    (c)(1)(A) If a department or agency considers an individual 
acquisition of a product to be indispensable for national security or 
national defense purposes and appropriate for exclusion from the 
provisions of FAR subpart 25.4, it may submit a request with supporting 
rationale to the Director of Defense Procurement (USD(A&T)DP).
    (B) The following national security/national defense exceptions do 
not require approval by USD(A&T)DP--
    (1) Where purchase from foreign sources is restricted by the DoD 
annual Appropriations or Authorization Acts (see subpart 225.70) or by 
the establishment of required sources of supplies and services under FAR 
part 8.
    (2) Where competition from foreign sources is restricted under the 
authority of FAR 6.302-3(a)(2)(i). Provide USD(A&T)DP a copy of the 
justification for restricting competition in accordance with FAR 
25.402(e) and FAR 6.303-1(d).
    (3) Where competition from foreign sources is restricted under 
subpart 225.71.
    (g)(4) In accordance with Section 8094 of the Fiscal Year 1994 
Defense Appropriations Act (Public Law 103-139), the exception for 
petroleum and any product derived from petroleum does not apply.
[56 FR 36367, July 31, 1991, as amended at 59 FR 23169, May 5, 1994; 60 
FR 61597, Nov. 30, 1995; 61 FR 37841, July 22, 1996; 61 FR 50453, Sept. 
26, 1996; 62 FR 34122, June 24, 1997]



225.403-70  Products subject to trade agreement acts.

    Foreign end products subject to the Trade Agreements Act and NAFTA 
are those in the following Federal supply groups (FSG). If a product is 
not in one of the listed groups, the Trade Agreements Act and NAFTA do 
not apply. The definition of Caribbean Basin country end products in FAR 
25.401 excludes those end products which are not eligible for duty-free 
treatment under 19 U.S.C. 2703(b). However, 225.401 expands the 
definition of Caribbean Basin country end products to include petroleum 
and any product derived from petroleum. The list of products has been 
annotated to indicate those products which are eligible for designated 
and NAFTA countries, but are not presently eligible for Caribbean Basin 
countries.

                                                                        
                                                                        
              FSG                          Category/Description         
                                                                        
22                               Railway equipment                      
23                               Motor vehicles, trailers, and cycles   
                                  (except 2350 and buses under 2310)    
24                               Tractors                               
25                               Vehicular equipment components         
26                               Tires and tubes                        
29                               Engine accessories                     
30                               Mechanical power transmission equipment
32                               Woodworking machinery and equipment    
34                               Metalworking machinery                 
35                               Service and trade equipment            
36                               Special industry machinery (except     
                                  3690)                                 
37                               Agricultural machinery and equipment   

[[Page 168]]

                                                                        
38                               Construction, mining, excavating, and  
                                  highway maintenance equipment         
39                               Materials handling equipment           
40                               Rope, cable, chain and fittings        
41                               Refrigeration and air conditioning     
                                  equipment                             
42                               Fire fighting, rescue and safety       
                                  equipment                             
43                               Pumps and compressors                  
44                               Furnace, steam plant and drying        
                                  equipment (except 4470)               
45                               Plumbing, heating, and sanitation      
                                  equipment                             
46                               Water purification and sewage treatment
                                  equipment                             
47                               Piping, tubing, hose, and fitting      
48                               Valves                                 
49                               Maintenance and repair shop equipment  
                                  (except 4920-4927, 4931-4935, 4960)   
53                               Hardware and abrasives                 
54                               Prefabricated structures and           
                                  scaffolding                           
55                               Lumber, millwork, plywood, and veneer  
56                               Construction and building materials    
61                               Electric wire, and power and           
                                  distribution equipment                
62                               Lighting fixtures and lamps            
63                               Alarm and signal systems               
65                               Medical, dental, and veterinary        
                                  equipment and supplies                
66                               Instruments and laboratory equipment   
                                  (except aircraft clocks under 6645)-- 
                                  See FAR 25.401 exclusion of certain   
                                  watches and watch parts for certain   
                                  Caribbean Basin countries             
67                               Photographic equipment                 
68                               Chemicals and chemical products        
69                               Training aids and devices              
70                               General purpose ADPE, software,        
                                  supplies, and support equipment       
71                               Furniture                              
72                               Household and commercial furnishings   
                                  and appliances                        
73                               Food preparation and serving equipment 
74                               Office machines, visible record        
                                  equipment and ADP 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 (except 8140)                
84                               Luggage (only 8460)--See FAR 25.401 for
                                  exclusion of luggage for Caribbean    
                                  Basin countries                       
85                               Toiletries                             
87                               Agricultural supplies                  
88                               Live animals                           
91                               Fuels, oils and waxes                  
93                               Nonmetallic fabricated materials       
94                               Nonmetallic crude materials            
96                               Ores, minerals, and their primary      
                                  products                              
99                               Miscellaneous                          
                                                                        

[56 FR 36367, July 31, 1991, as amended at 59 FR 1289, Jan. 10, 1994; 59 
FR 23169, May 5, 1994; 61 FR 37841, July 22, 1996; 62 FR 2615, Jan. 17, 
1997]



225.405  Procedures.

    (d) The requirements of FAR 25.405(d) do not apply to offshore 
acquisitions or to Defense Fuel Supply Center post, camp, or station 
overseas requirements.



225.408  Solicitation provisions and contract clauses.

    (a)(1) Use the provision at 252.225-7006, Buy American Act-Trade 
Agreements-Balance of Payments Program Certificate, instead of the 
provision at FAR 52.225-8, Buy American Act-Trade Agreements-Balance of 
Payments Program Certificate, in all solicitations that include the 
clause at 252.225-7007, Trade Agreements.
    (2) Use the clause at 252.225-7007, Trade Agreements, instead of the 
clause at FAR 52.225-9, Buy American Act--Trade Agreements--Balance of 
Payments Program. The clause need not be used where purchase from 
foreign sources is restricted (see 225.403(d)(1)(B)). The clause may be 
used where the contracting officer anticipates a waiver of the 
restriction. For procurements by the U.S. Army Corps of Engineers, use 
the clause with its Alternate I.
    (3) Use the provision at 252.225-7035, Buy American Act--North 
American Free Trade Agreement Implementation Act--Balance of Payments 
Program Certificate, instead of the provision at FAR 52.225-20, Buy 
American Act--North American Free Trade Agreement Implementation Act--
Balance of Payments Program Certificate, in all solicitations that 
include the clause at 252.225-7036, North American Free Trade Agreement 
Implementation Act.
    (4)(A) Use the clause at 252.225-7036, North American Free Trade 
Agreement Implementation Act, instead of the

[[Page 169]]

clause at FAR 52.225-21, Buy American Act--North American Free Trade 
Agreement Implementation Act--Balance of Payments Program. The clause 
need not be used where purchase from foreign sources is restricted (see 
225.403(d)(1)(B)). The clause may be used where the contracting officer 
anticipates a waiver of the restriction.
    (B)(i) Use the clause in all solicitations and contracts for the 
items listed at 225.403-70, when the estimated value is $50,000 or more 
and the Trade Agreements Act does not apply. Include the clause in 
solicitations for multiple line items if any line item is subject to 
NAFTA.
    (ii) Use the clause with its Alternate I when the estimated value is 
between $25,000 and $50,000.
    (C) Application of the procedures in 225.402(a) and the acquisition 
of noneligible and eligible products under the same solicitation may 
result in the application of the North American Free Trade Agreement 
Implementation Act to only some of the items solicited. In such case, 
indicate in the schedule those items covered by the Act.
[56 FR 36367, July 31, 1991, as amended at 57 FR 42630, Sept. 15, 1992. 
Redesignated and amended at 59 FR 1289, Jan. 10, 1994; 60 FR 29498, June 
5, 1995; 61 FR 16880, Apr. 18, 1996]



                    Subpart 225.6--Customs and Duties



225.602  Policy.

    (1) Section XXII, chapter 98, subchapter VIII, Item 9808.00.30 of 
the Harmonized Tariff Schedule of the United States authorizes duty-free 
importation of defense supplies.
    (2) 19 U.S.C. 1309 authorizes duty-free importation of certain 
supplies (not including equipment) for vessels or aircraft operated by 
the United States (see FAR 25.604(b)).
    (3) DoD will issue duty-free entry certificates for--
    (i) Qualifying country supplies (end products and components) on all 
defense contracts;
    (ii) Eligible products (end products but not components) on defense 
contracts subject to the Trade Agreements Act or NAFTA; and
    (iii) Other foreign supplies, if there is reasonable assurance that 
the administrative and other costs of processing and controlling the 
certificates will not exceed the amount of duty that would be paid.
[56 FR 36367, July 31, 1991, as amended at 59 FR 1290, Jan. 10, 1994]



225.603  Procedures.

    (1) Issue duty-free entry certificates--
    (i) In accordance with the policy in 225.602;
    (ii) On contracts containing the clauses in--
    (A) FAR 52.225-10, Duty-Free Entry; or
    (B) 252.225-7009, Duty-Free Entry--Qualifying Country End Products 
and Supplies; or
    (C) 252.225-7037, Duty-Free Entry--NAFTA Country End Products and 
Supplies; or
    (iii) On other contracts that fall within one of the following 
categories--
    (A) Direct purchases of foreign supplies under a DoD prime contract, 
whether title passes at point of origin or at destination in the United 
States; provided, the contract states that the final price is exclusive 
of duty;
    (B) Purchases of foreign supplies by a domestic prime contractor 
under a cost-reimbursement type contract or by a cost-reimbursement type 
subcontractor (where no fixed-price prime or fixed-price subcontract 
intervenes between the purchaser and the Government), whether title 
passes at point of origin or at destination in the United States. If a 
fixed-price prime or fixed-price subcontract intervenes, follow the 
criteria stated in paragraph (1)(iii)(C) of this section; or
    (C) Purchases of foreign supplies by a fixed-price domestic prime 
contractor, a fixed-price subcontractor, or a cost-type subcontractor 
where a fixed-price prime contract, or fixed-price subcontract 
intervenes; provided--
    (1) The fixed-price prime contract and, where applicable, fixed-
price subcontract prices are, or are amended to be, exclusive of duty;
    (2) The supplies so purchased will be delivered to the Government or 
incorporated in Government-owned property or in an end product to be 
furnished to the Government, and the duty will be

[[Page 170]]

paid if such supplies or any portion are used for other than the 
performance of the Government contract or disposed of other than for the 
benefit of the Government in accordance with the contract terms; and
    (3) Such acquisition abroad is authorized by the terms of the 
contract, the subcontract, or by the contracting officer. In any case, 
follow the procedures required by the clauses in FAR 52.225-10, Duty-
Free Entry, and 252.225-7009, Duty-Free Entry--Qualifying Country End 
Products and Supples, and 252.225-7037, Duty-Free Entry--NAFTA Country 
End Products and Supplies, to the extent practicable.
    (2) Do not issue duty-free entry certificates or exempt duty for end 
products, components, or supplies already entered into the customs 
territory of the United States for which duty has already been paid.
    (3) If a duty-free entry certificate is issued a contractor under a 
fixed-price contract based on the contractor's providing a domestic or 
qualifying country end product, component, or supply, negotiate an 
equitable reduction in the contract price if the contractor subsequently 
furnishes a nonqualifying country end product, component, or supply.
    (4) Exclude duty from the contract price for end products, 
components, or supplies that are being accorded duty-free entry.
    (5) Except as required under the evaluation procedures in 225.105 
for the Buy American Act, do not evaluate duty for items accorded duty-
free entry.
    (6) Even if duty is evaluated under Subpart 225.1, the supplies may 
still be authorized duty-free entry if to do so is consistent with the 
policies in 225.602. However, if the Government will pay a duty, then 
the cost of the duty must be included in the contract price and 
evaluated as part of the offer.
    (b) Formal entry and release. (i) The administrative contracting 
officer must--
    (A) Ensure that prime contractors are aware of and understand any 
Duty-Free Entry clause requirements. Contractors should understand that 
failure by them or their subcontractors to include the data required by 
the clause will result in treatment of the shipment as without benefit 
of free entry under section XXII, chapter 98, subchapter VIII, Item 
9808.00.30 of the Harmonized Tariff Schedule of the United States.
    (B) Upon receipt of the required notice of purchase of foreign 
supplies from the contractor or any tier subcontractor--
    (1) Verify the duty-free entitlement of goods entering under the 
contract; and
    (2) Review the prime contract to ensure that performance of the 
contract requires the foreign supplies (quantity and price) identified 
in the notice.
    (C) Upon receipt of notification from the contractor that it is 
placing a foreign purchase that was not identified at the time of 
contract award--
    (1) Determine whether a reduction in the contract price is required 
under the clause at FAR 52.225-10, Duty-Free Entry;
    (2) If so, make an equitable adjustment in the contract price, 
unless the procuring contracting officer waives this adjustment;
    (3) Determine the price of the foreign supplies exclusive of duty, 
and advise the contractor that that amount will be the maximum dollar 
value of supplies for which duty-free entry certificates will be issued.
    (D) Within 20 days after receiving the notification of purchase of 
foreign supplies, forward the following information in the format 
indicated to the Commander, DCMAO New York, ATTN Customs Team, DCMDN-
GNIC, 207 New York Avenue, Staten Island, NY 10305-5013--

We have received a contractor notification of the purchase of foreign 
supplies. I have verified that foreign supplies are required for the 
performance of the contract. If required, the prime contract price has 
been or will be adjusted.
Prime Contractor Name and Address:
Prime Contractor CAGE Code:
Prime Contract Number plus Delivery Order Number, if applicable:
Total Dollar Value of the Prime Contract or Delivery Order:
Expiration Date of the Prime Contract or Delivery Order:
Foreign Supplier Name and Address:
Number of Subcontract/Purchase Order for Foreign Supplies:
Total Dollar Value of the Subcontract for Foreign Supplies:

[[Page 171]]

Expiration Date of the Subcontract for Foreign Supplies:
CAO Activity Address Number:
ACO Name and Telephone Number:
ACO Code:
Signature:
Title:

    (E) If a contract modification results in a change to any data 
verifying duty-free entitlement previously furnished, forward a revised 
notification including the changed data to DCMAO New York.
    (ii) The responsibility for issuing duty-free entry certificates for 
foreign supplies purchased under a DoD contract or subcontract rests 
with the Customs Team, DCMDN-GNIC, DCMAO New York. Upon receipt of 
import documentation for incoming shipments from the contractor, its 
agent, or the U.S. Customs Service, DCMAO New York will verify the duty-
free entitlement and execute the duty-free entry certificate.
    (iii) Upon arrival of foreign supplies at ports of entry, the 
consignee, generally the contractor or its agent (import broker) for 
shipments to other than a military installation, will file U.S. Customs 
Form 7501, 7501A, or 7506, with the District Director of Customs.
    (c) Immediate entry and release. Importations made in the name of a 
DoD military facility or being shipped directly to a military facility 
are entitled to release under the immediate delivery procedure.
    (i) A DoD immediate delivery application has been approved and is on 
file at Customs Headquarters.
    (ii) The application is for an indefinite period and is good for all 
Customs districts, areas, and ports.
[56 FR 36367, July 31, 1991, as amended at 59 FR 1290, Jan. 10, 1994; 60 
FR 29498, June 5, 1995; 62 FR 2613, Jan. 17, 1997]



225.604  Exempted supplies.

    (b)(i) The term ``supplies''--
    (A) Includes articles known as ``stores,'' such as food, medicines, 
and toiletries, as well as all consumable articles necessary and 
appropriate for the propulsion, operation, and maintenance of the vessel 
or aircraft, such as fuel, oil, gasoline, grease, paint, cleansing 
compounds, solvents, wiping rags, and polishes.
    (B) Does not include portable articles necessary and appropriate for 
the navigation, operation, or maintenance of vessel or aircraft and for 
the comfort and safety of the persons on board, such as rope, bolts and 
nuts, bedding, china and cutlery, which are included in the term 
``equipment.''
    (ii) The duty-free certificate shall be printed, stamped, or typed 
on the face of Customs Form 7501, or attached, and shall be executed by 
a duly designated officer or civilian official of the appropriate 
department or agency in the following form--

    (Date)____________________
    I certify that the acquisition of this material constituted a 
purchase of supplies by the United States for vessels or aircraft 
operated by the United States, and is admissible free of duty pursuant 
to 19 U.S.C. 1309.
    (Name)____________________
    (Title)____________________
    (Organization)____________________



225.605  Contract clause.

    (b) The dollar amount in paragraphs (b)(1) and (i)(2) of the FAR 
52.225-10 clause may be reduced appropriately in solicitations and 
contracts of $100,000 or less.



225.605-70  Additional solicitation provisions and contract clauses.

    (a) Use the clause at 252.225-7008, Supplies to be Accorded Duty-
Free Entry, in all solicitations and contracts when--
    (1) Duty-free entry will be granted under the resultant contract; 
and
    (2) The solicitation and contract include the clauses at--
    (i) FAR 52.225-10, Duty-Free Entry; or
    (ii) 252.225-7009, Duty-Free Entry--Qualifying Country End Products 
and Supplies.
    (b) Use the clause at 252.225-7009, Duty-Free Entry--Qualifying 
Country End Products and Supplies, in all solicitations and contracts 
for supplies and in all solicitations and contracts for services 
involving the furnishing of supplies. Do not use the clause in a 
contract for supplies for exclusive use outside the United States.
    (c) Use the clause at 252.225-7037, Duty-Free Entry--NAFTA Country 
End Products and Supplies, in all solicitations and contracts for 
supplies and services when the clause at FAR

[[Page 172]]

52.225-10, Duty-Free Entry, is not used and NAFTA applies (see 225.403-
70).
    (d) Use the clause at 252.225-7010, Duty-Free Entry--Additional 
Provisions, in all solicitations and contracts which include the clause 
at FAR 52.225-10, Duty-Free Entry.
[56 FR 36367, July 31, 1991, as amended at 59 FR 1290, Jan. 10, 1994]



        Subpart 225.7--Restrictions on Certain Foreign Purchases



225.702  Restrictions.

    See 209.104-1(g)(i) for restrictions on contracting with firms owned 
or controlled by foreign governments that support terrorism. See 
209.104-1(g)(ii) for prohibition on award of a DoD contract under a 
national security program to an entity controlled by a foreign 
government when access to proscribed information is required to perform 
the contract.
[59 FR 51133, Oct. 7, 1994]



225.770  Secondary Arab boycott of Israel.



225.770-1  Restriction.

    In accordance with 10 U.S.C. 2410i, do not enter into a prime 
contract with a foreign person, company, or entity unless it has 
certified that it does not comply with the secondary Arab boycott of 
Israel.
[58 FR 28467, May 13, 1993]



225.770-2  Procedures.

    For contracts awarded to the Canadian Commercial Corporation (CCC), 
the CCC will submit a certification from its proposed subcontractor with 
the other required precontractual material (see 225.870).
[57 FR 53599, Nov. 12, 1992]



225.770-3  Exceptions.

    The restriction does not apply to--
    (a) Purchases below the small purchase threshold in FAR 13.101;
    (b) Contracts for consumable supplies, provisions, or services for 
the support of the United States or of allied forces in a foreign 
country; or
    (c) Contracts pertaining to any equipment, technology, data, or 
services for intelligence or classified purposes, or the acquisition or 
lease thereof in the interest of national security.
[57 FR 53599, Nov. 12, 1992]



225.770-4  Waivers.

    The Secretary of Defense may waive the restriction on the basis of 
national security interests. Waiver requests should be forwarded to the 
Director of Defense Procurement, OUSD(A&T)DP.
[57 FR 53599, Nov. 12, 1992, as amended at 60 FR 61597, Nov. 30, 1995]



225.770-5  Solicitation provision and contract clause.

    Unless an exception applies or a waiver has been granted, use the 
clause at 252.225-7031, Secondary Arab Boycott of Israel, in all 
solicitations and contracts.
[57 FR 53599, Nov. 12, 1992]



        Subpart 225.8--International Agreements and Coordination



225.801  International agreements.

    (1) Treaties and agreements between the U.S. and foreign governments 
affect both--
    (i) The way offers from foreign contractors are evaluated in DoD 
acquisitions; and
    (ii) Performance of DoD contracts in foreign countries.
    (2) This subpart covers acquisition policy and procedures based on 
treaties and international agreements.
    (3) Information on specific agreements is available as follows--
    (i) Memoranda of understanding (MOU) and other international 
agreements between the United States and the countries listed in 
225.872-1 are maintained in the Office of the Deputy Assistant Secretary 
of Defense (Procurement) (Foreign Contracting) (703) 697-9351, DSN 227-
9351).
    (ii) Military Assistance Advisory Groups, Naval Missions, and Joint 
U.S. Military Aid Groups normally have copies of the agreements 
applicable to the countries concerned.
    (iii) Copies of international agreements covering existing 
agreements in the United Kingdom of Great Britain and Northern Ireland, 
Western European countries, North Africa, and in

[[Page 173]]

the Middle East are filed with the U.S. European Command (EUCOM).
    (iv) Agreements with countries in the Pacific and Far East are filed 
with the U.S. Pacific Command (CINCPAC).



225.802  Procedures.



225.802-70  Contracts for performance outside the United States and Canada.

    (a) When a purchasing activity anticipates placement of a contract 
for performance outside the United States or Canada and the contracting 
activity is not under the command jurisdiction of a unified or specified 
command for the country involved, the purchasing activity shall maintain 
liaison with the cognizant contract administration office (CAO) (as 
specified in DLAH 4105.5) during preaward negotiations and postaward 
administration. The CAO will provide pertinent information for contract 
negotiations, effect appropriate coordination, and obtain required 
approvals for the performance of the contract.
    (b) Where the acquisition requires the performance of work in the 
foreign country by U.S. personnel or a third country contractor, or 
where the acquisition will require logistics support for contract 
employees, source inspection, or additional Government employees--
    (1) The contracting activity must coordinate with the cognizant 
contract administration office before contract award.
    (2) The contracting officer shall request the following information 
from the contract administration office--
    (i) The applicability of any international agreements to the 
acquisition;
    (ii) Security requirements applicable to the area;
    (iii) The standards of conduct required to be observed by the 
prospective contractor and its employees, and any action that may be 
taken in the event required standards are not maintained;
    (iv) Requirements for use of foreign currencies, including 
applicability of U.S. holdings of excess foreign currencies;
    (v) Availability of logistics support for contractor employees; and
    (vi) Information on taxes and duties from which the Government may 
be exempt.
    (3) The contracting officer shall furnish the following information 
to the contract administration office--
    (i) A synopsis of the work to be performed and, if practical, a copy 
of the solicitation;
    (ii) Any contractor logistical support desired in support of U.S. or 
foreign military sale requirements;
    (iii) Contract performance period and estimated contract value;
    (iv) Number and nationality of contractor employees and date of 
planned arrival of contractor personnel;
    (v) Contract security requirements; and
    (vi) Other pertinent information to effect complete coordination and 
cooperation.



225.802-71  End user certificates.

    Contracting officers considering the purchase of an item from a 
foreign source may encounter a request for the signing of a certificate 
to the effect that the Armed Forces of the United States is the end user 
of the equipment, and that it will not be transferred to third parties 
without authorization from the Government of the country selling the 
item. When encountering this situation, refer to DoD Directive 2040.3, 
End User Certificates, for guidance.
[57 FR 42630, Sept. 15, 1992]



225.870  Contracting with Canadian contractors.



225.870-1  General.

    (a) The Canadian Government guarantees to the U.S. Government all 
commitments, obligations, and covenants of the Canadian Commercial 
Corporation under any contract or order issued to the Corporation by any 
contracting activity of the U.S. Government. The Canadian Government has 
waived notice of any change or modification which may be made, from time 
to time, in these commitments, obligations, or covenants.
    (b) For production planning purposes, Canada is considered to be 
part of the defense industrial base (see 225.870-2(b)).

[[Page 174]]

    (c) Contracts with contractors located in Canada should be awarded 
to and administered by the Canadian Commercial Corporation, except for--
    (1) Negotiated purchases for experimental, developmental, or 
research work unless the contract is for a project under the Defense 
Development Sharing Program;
    (2) Purchases of unusual or compelling urgency;
    (3) Small purchases; or
    (4) Purchases made by DoD activities located in Canada.
    (d) The Canadian Commercial Corporation, in placing contracts with 
Canadian or U.S. concerns, uses provisions in the contracts that give 
DoD the same production rights, data, and information that DoD would 
obtain in contracts with U.S. concerns.
    (e) When contracts are placed with the Canadian Commercial 
Corporation, the government of Canada will provide the following 
services, without charge to DoD departments and agencies--
    (1) Contract administration services, including--
    (i) Cost and pricing analysis;
    (ii) Industrial security;
    (iii) Accountability and disposal of Government property;
    (iv) Production expediting;
    (v) Compliance with Canadian labor laws;
    (vi) Processing termination claims and disposing of termination 
inventory;
    (vii) Customs documentation;
    (viii) Processing of disputes and appeals; and
    (ix) Such other related contract administration functions as may be 
required with respect to the Canadian Commercial Corporation contract 
with the Canadian supplier; and
    (2) Audits. When required, audits are performed by the Audit Service 
Group, Supply and Services Canada. Requests for audit on non-Canadian 
Commercial Corporation contracts should be routed through the cognizant 
contract administration office of Defense Contract Management Command.
    (3) Inspection. The Department of National Defence (Canada) provides 
inspection personnel, services, and facilities, at no charge to DoD 
departments and agencies (see 225.870-7).



225.870-2  Solicitation of Canadian contractors.

    (a) Except for the acquisitions in 225.870-1(c) (1) through (4), 
include Canadian firms on bidders mailing lists and comparable source 
lists only at the request of the Canadian Commercial Corporation.
    (b) Include Canadian planned producers under the Industrial 
Readiness Planning Program on bidders mailing lists for their planned 
items (see FAR 14.205-1).
    (c) Send solicitations directly to Canadian firms appearing on the 
appropriate bidders mailing lists. Send a complete copy of the 
solicitation and a listing of Canadian firms solicited to the Canadian 
Commercial Corporation, 11th Floor, 50 O'Connor Street, Ottawa, Ontario, 
K1A-0S6, Canada.
    (d) Furnish a solicitation, if requested, to the Canadian Commercial 
Corporation even if no Canadian firm is solicited.
    (e) Handle small purchases (see FAR part 13) directly with Canadian 
firms and not through the Canadian Commercial Corporation.
[56 FR 36367, July 31, 1991, as amended at 57 FR 42630, Sept. 15, 1992]



225.870-3  Submission of offers.

    (a) As indicated in 225.870-4, the Canadian Commercial Corporation 
is the prime contractor. To indicate acceptance of offers by individual 
Canadian companies, the Canadian Commercial Corporation issues a letter, 
supporting the Canadian offer, containing the following information--
    (1) Name of the Canadian offeror;
    (2) Confirmation and endorsement of the offer in the name of the 
Canadian Commercial Corporation; and
    (3) A statement that the Corporation shall subcontract 100 percent 
with the offeror.
    (b) When a Canadian offer cannot be processed through the Canadian 
Commercial Corporation in time to meet the bid-opening requirement or 
the closing date for receipt of proposals, the Corporation may permit 
Canadian firms to submit offers directly. The Canadian Commercial 
Corporation's endorsement of award, however, must be

[[Page 175]]

received by the contracting officer before contract award.
    (c) All sealed bids will be submitted by the Canadian Commercial 
Corporation in terms of U.S. currency. Do not adjust contracts awarded 
under sealed bidding for losses or gains from fluctuation in exchange 
rates.
    (d) Except for sealed bids, all offers and quotations submitted by 
the Canadian Commercial Corporation are normally in terms of Canadian 
currency. The Corporation may, at the time of submitting an offer, elect 
to quote and receive payment in terms of U.S. currency, in which case 
the contract shall--
    (1) Provide for payment in U.S. currency; and
    (2) Shall not be adjusted for losses or gains from fluctuation in 
exchange rates.



225.870-4  Contracting procedures.

    (a) Award individual contracts covering purchases from suppliers 
located in Canada, except for those in 225.870-1(c)(1) through (4), to 
the Canadian Commercial Corporation, 11th Floor, 50 O'Connor Street, 
Ontario, Canada, K1A-0S6.
    (b) Direct communication with the Canadian supplier is authorized 
and encouraged in connection with all technical aspects of the contract; 
provided, that the Corporation's approval is obtained on any matters 
involving changes to the contract.
    (c) Identify in the contract, the type of currency, i.e., U.S. or 
Canadian. Contracts that provide for payment in Canadian currency shall 
quote the contract price in terms of Canadian dollars and shall identify 
the amount by the initials CN; e.g., $1,647.23CN. The contract shall 
clearly indicate on its face the U.S./Canadian conversion rate at the 
time of award and the U.S. dollar equivalent of the Canadian dollar 
contract amount.
[56 FR 36367, July 31, 1991, as amended at 57 FR 42630, Sept. 15, 1992]



225.870-5  Contract administration.

    (a) Assign contract administration in accordance with part 242. When 
contract administration is performed in Canada by the cognizant contract 
administration office of the Defense Contract Management Command, the 
paying office to be named in the contract for disbursement of DoD funds 
(DoD Department Code: 17-Navy; 21-Army; 57-Air Force; 97-all other DoD 
components), whether payment is in Canadian or U.S. dollars, shall be: 
Disbursing Office, Defense Contract Management Area Office, Cleveland 
1240 East 9th Street, Anthony J. Celebrezze Federal Building, Cleveland, 
Ohio 44199.
    (b) For cost-reimbursement type contracts--
    (1) Audits on contracts with the Canadian Commercial Corporation 
(CCC) are automatically arranged by the Department of Supplies and 
Services (DSS), Canada. Audit reports are furnished to DSS. Upon advice 
from DSS, the CCC will certify the invoice and forward it with SF 1034, 
Public Voucher, to the administrative contracting officer for further 
processing and transmittal to the disbursing office.
    (2) On contracts placed directly with Canadian firms, the 
administrative contracting officer requests audits from the Audit 
Services Bureau (ASB), Ottawa, Ontario, Canada.
    (i) Invoices are approved by the ASB/DSS auditor on a provisional 
basis pending completion of the contract and final audit.
    (ii) The ASB/DSS forwards these invoices, accompanied by SF 1034, 
Public Voucher, to the administrative contracting officer for further 
processing and transmittal to the disbursing officer.
    (iii) ASB/DSS furnishes periodic advisory audit reports directly to 
the administrative contracting officer.



225.870-6  Termination procedures.

    (a) The Canadian Commercial Corporation will continue administering 
contracts that may be terminated by the U.S. contracting officer.
    (b) The Corporation will settle all Canadian subcontracts in 
accordance with the policies, practices, and procedures of the Canadian 
Government.
    (c) The U.S. agency administering the contract with the Canadian 
Commercial Corporation shall provide any services required by the 
Canadian Commercial Corporation, including disposal of inventory, for 
settlement of any subcontracts placed in the United States.

[[Page 176]]

Settlement of such U.S. subcontracts is made under this regulation.



225.870-7  Acceptance of Canadian supplies.

    (a) When contracts placed in Canada, either with the Canadian 
Commercial Corporation or directly with Canadian suppliers, require 
contract quality assurance (CQA) and/or acceptance before shipment, CQA 
and/or acceptance, as applicable, will be performed by the Department of 
National Defence (Canada), under paragraph 6 of the Letter of Agreement.
    (b) Signature by the Department of National Defence (Canada) quality 
assurance representative on the DoD inspection and acceptance form is 
satisfactory evidence of acceptance for payment purposes.



225.870-8  Industrial security.

    Industrial security for Canada shall be in accordance with the U.S.-
Canada Industrial Security Agreement of March 31, 1952, as amended.



225.871  North Atlantic Treaty Organization (NATO) cooperative projects.



225.871-1  Scope.

    (a) This section provides guidance on awarding contracts based on 
NATO cooperative projects.
    (b) The authority is 22 U.S.C. 2767 and 10 U.S.C. 2350b.



225.871-2  Definitions.

    (a) Cooperative project means a jointly managed arrangement--
    (1) Described in a written agreement between the parties;
    (2) Undertaken to further the objectives of standardization, 
rationalization, and interoperability of the armed forces of North 
Atlantic Treaty Organization member countries; and
    (3) Providing for--
    (i) One or more of the other participants to share with the United 
States the cost of research and development, testing, evaluation, or 
joint production (including follow-on support) of certain defense 
articles;
    (ii) Concurrent production in the United States and in another 
member country of a defense article jointly developed; or
    (iii) Acquisition by the United States of a defense article or 
defense service from another member country.
    (b) Other participant means a cooperative project participant other 
than the United States.



225.871-3  General.

    (a) Cooperative project authority. (1) Departments or agencies, that 
have authority to do so, may enter into a cooperative project agreement 
with NATO or with one or more member countries of that organization 
under DoD Directive 5530.3, International Agreements.
    (2) Under laws and regulations governing the negotiation and 
implementation of cooperative project agreements, departments and 
agencies may enter into contracts, or incur other obligations, on behalf 
of other participants without charge to any appropriation or contract 
authorization.
    (3) Agency heads have authority to solicit and award contracts to 
implement cooperative projects.
    (b) Contracts implementing cooperative projects shall comply with 
all applicable laws relating to Government acquisition, unless a waiver 
is granted under 225.871-4. A waiver of certain laws and regulations may 
be obtained if--
    (1) Required by the terms of a written cooperative project 
agreement;
    (2) It will significantly further NATO standardization, 
rationalization, and interoperability; and
    (3) It is approved by the appropriate DoD official.



225.871-4  Statutory waivers.

    (a) The Deputy Secretary of Defense may waive for contracts or 
subcontracts placed outside the United States any provision of law that 
specifically prescribes--
    (1) Procedures for the formation of contracts;
    (2) Terms and conditions for inclusion in contracts;
    (3) Requirements for, or preferences to be given--
    (i) To goods grown, produced, or manufactured in the United States 
or in U.S. Government-owned facilities; or
    (ii) For services to be performed in the United States; or

[[Page 177]]

    (4) Requirements regulating the performance of contracts.
    (b) There is no authority for waiver of--
    (1) Any provision of the Arms Export Control Act (22 U.S.C. 2751);
    (2) Any provision of 10 U.S.C. 2304;
    (3) The cargo preference laws of the United States, including the 
Military Cargo Preference Act of 1904 (10 U.S.C. 2631) and the Cargo 
Preference Act of 1954 (46 U.S.C. 1241(b)); or
    (4) Any of the financial management responsibilities administered by 
the Secretary of the Treasury.
    (c) If a waiver is contemplated under the terms of a cooperative 
project agreement, forward a request for the waiver to the Deputy 
Secretary of Defense, through the Director of Defense Procurement. The 
waiver request must include a draft Determination and Findings for 
signature by the Deputy Secretary of Defense establishing that the 
waiver is necessary to significantly further NATO standardization, 
rationalization, and interoperability.
    (d) The approval of the Deputy Secretary of Defense must be obtained 
before committing to make waivers in an agreement or an amendment to an 
agreement or contract.



225.871-5  Directed subcontracting.

    (a) The Director of Defense Procurement may authorize the direct 
placement of subcontracts with particular subcontractors. Directed 
subcontracting is not authorized unless specifically addressed in the 
cooperative project agreement.
    (b) In some instances, it may not be feasible to name specific 
subcontractors at the time the agreement is concluded. The general 
provisions for work sharing at the prime and subcontractor level, 
however, must be clearly delineated in the agreement. This will provide 
the authority necessary to implement such arrangements during the 
acquisition phase.
    (c) The agreement is the authority necessary for including a 
contractual provision requiring the prime contractor to place certain 
subcontracts with particular subcontractors. No separate justification 
and approval during the acquisition process is required.



225.871-6  Disposal of property.

    Dispose of property that is jointly acquired by the members of a 
cooperative project under the procedures established in the agreement or 
in a manner consistent with the terms of the agreement.



225.871-7  Congressional notification.

    (a) Congress must be notified whenever DoD determines to award a 
prime contract or subcontract to a particular contractor if the 
determination was not part of the certification made under Section 27(f) 
of the Arms Export Control Act before finalizing the cooperative 
agreement.
    (1) Departments and agencies must provide a proposed Congressional 
notice to USD(A&T)DP in sufficient time to forward to Congress before 
the time of contract award.
    (2) The proposed notice shall include the reason why the authority 
to designate a particular contractor or subcontractor should be used.
    (b) Congressional notification is also required each time a 
statutory waiver is exercised under 225.871-4, if such information was 
not provided in the certification to Congress before finalizing the 
cooperative agreement. Exercise of the waiver means a contract award or 
modification which provides for a statutory exception.
[56 FR 36367, July 31, 1991, as amended at 60 FR 61597, Nov. 30, 1995]



225.872  Contracting with qualifying country sources.



225.872-1  General.

    (a) As a result of memoranda of understanding and other 
international agreements, the DoD has determined it inconsistent with 
the public interest to apply restrictions of the Buy American Act/
Balance of Payments Program to the acquisition of defense equipment 
which is mined, produced, or manufactured in any of the following 
countries (referred to in this part as ``qualifying countries'')--

    Australia
    Belgium
    Canada
    Denmark
    Egypt
    Federal Republic of Germany

[[Page 178]]

    France
    Greece
    Israel
    Italy
    Luxembourg
    Netherlands
    Norway
    Portugal
    Spain
    Turkey
    United Kingdom of Great Britain and Northern Ireland

    (b) Individual acquisitions for products of the following qualifying 
countries may, on a purchase-by-purchase basis, be exempted from 
application of the Buy American Act and Balance of Payments Program as 
inconsistent with the public interest--

    Austria
    Finland
    Sweden
    Switzerland

    (c) The determination in paragraph (a) of this subsection does not 
limit the authority of the cognizant Secretary to restrict acquisitions 
to domestic sources or reject an otherwise acceptable offer from a 
qualifying country source in instances where considered necessary for 
national defense reasons.
    (d) The Secretary of Defense has waived the restrictions of 10 
U.S.C. 2534(a) for the acquisition of defense items manufactured in a 
qualifying country listed in paragraph (a) or (b) of this subsection, in 
accordance with the provisions of 10 U.S.C. 2534(d)(3).
[56 FR 36367, July 31, 1991, as amended at 57 FR 53599, Nov. 12, 1992; 
60 FR 61597, Nov. 30, 1995; 62 FR 34122, June 24, 1997]



225.872-2  Applicability.

    (a) This section applies to all acquisitions of supplies except 
where restricted by--
    (1) Provision of U.S. National Disclosure Policy (NDP), DOD 
Directive 5230.11, Disclosure of Classified Military Information to 
Foreign Governments and International Organizations;
    (2) U.S. defense mobilization base requirements purchased under the 
authority of FAR 6.302-3(a)(2)(i) except for quantities in excess of 
that required to maintain the defense mobilization base. This 
restriction does not apply to Canadian planned producers--
    (i) Review individual solicitations to determine whether this 
restriction applies.
    (ii) Information concerning restricted items may be obtained from 
the Deputy Assistant Secretary of Defense (Industrial Affairs);
    (3) Other U.S. laws or regulations (e.g., the annual defense 
appropriations act); and
    (4) U.S. industrial security requirements.
    (b) This section does not apply to construction contracts.
[56 FR 36367, July 31, 1991, as amended at 60 FR 61597, Nov. 30, 1995; 
62 FR 34123, June 24, 1997]



225.872-3  Solicitation procedures.

    (a) Include qualifying country sources on bidders mailing lists and 
comparable source lists upon their request (see FAR 14.205).
    (b) Except for items developed under the U.S./Canadian Development 
Sharing Program, use the criteria for soliciting and making awards under 
FAR part 19 for small business concerns without regard to whether there 
are potential qualifying country sources for the end product. Do not 
consider an offer of a qualifying country end product if the 
solicitation is identified for the exclusive participation of small 
business firms.
    (c) Send solicitations directly to qualifying country sources. 
Solicit Canadian sources through the Canadian Commercial Corporation in 
accordance with 225.870.
    (d) Use international air mail if solicitation destinations are 
outside the United States and security classification permits such use 
(see FAR 14.202 and FAR 14.203).
    (e) If unusual technical or security requirements preclude the 
acquisition of otherwise acceptable defense equipment from qualifying 
country sources, review the need for such requirements. Do not impose 
unusual technical or security requirements solely for the purpose of 
precluding the acquisition of defense equipment from qualifying 
countries.
    (f) Do not automatically exclude qualifying country sources from 
submitting offers because their supplies

[[Page 179]]

have not been tested and evaluated by the department/agency.
    (1) Consider the adequacy of qualifying country service testing on a 
case-by-case basis. Departments or agencies that must limit 
solicitations to sources whose items have been service tested and 
evaluated by the department/agency shall consider supplies from 
qualifying country sources that have been tested and accepted by the 
qualifying country for service use.
    (2) The department/agency may perform a confirmatory test, if 
necessary.
    (3) Apply U.S. test and evaluation standards, policies, and 
procedures when the department/agency decides that confirmatory tests of 
qualifying country end products are necessary.
    (4) Where it appears that these provisions might adversely delay 
service programs, obtain the concurrence of the DoD Acquisition 
Executive, Under Secretary of Defense (Acquisition & Technology), before 
excluding the qualifying country source from consideration.
    (g) Permit industry representatives from a qualifying country to 
attend symposia, program briefings, prebid conferences (FAR 14.207 and 
FAR 15.409), and similar meetings that address U.S. defense equipment 
needs and requirements. When practical, structure these meetings to 
allow attendance by representatives of qualifying country concerns.
[56 FR 36367, July 31, 1991, as amended at 60 FR 61597, Nov. 30, 1995]



225.872-4  Evaluation of offers.

    (a) Qualifying country sources competing for DoD requirements must 
be responsive to the terms and conditions of DoD solicitations.
    (b) Evaluate offers of end products from the qualifying country 
sources in 225.872-1(a) without application of the 50 percent Buy 
American Act or Balance of Payments Program evaluation factor, in 
accordance with 225.105 and 225.303.
    (c) Evaluate offers of end products from the qualifying country 
sources in 225.872-1(b) without application of the 50 percent Buy 
American Act or Balance of Payments Program evaluation factor. If the 
offer, as evaluated, is low or otherwise eligible for award, the 
contracting officer shall request an exemption of the Buy American Act/
Balance of Payments Program as inconsistent with the public interest.
    (1) To obtain an exemption, process a Determination and Findings for 
signature--
    (i) At a level above the contracting officer, for acquisitions of 
$25,000 or less;
    (ii) By the chief of the contracting office, for acquisitions of 
$250,000 or less;
    (iii) By the head of the contracting activity (HCA), for 
acquisitions of $2 million or less; or
    (iv) By the head of the agency, or designee at a level no lower than 
an HCA, for acquisitions over $2 million.
    (2) The Determination and Findings shall be substantially as follows 
for end items, or modified as necessary for components--

                            Service or Agency

      Exemption of the Buy American Act/Balance of Payments Program

                       Determination and Findings

    Upon the basis of the following findings and determination which I 
hereby make in accordance with the provisions of FAR 25.102, acquisition 
of (qualifying country--identify country) (describe item) may be made as 
provided below.

                                Findings

    1. The (contracting activity) proposes to purchase under contract 
number, ____________, mined, produced, or manufactured in (country of 
origin). The total estimated cost of this acquisition is ____________.
    2. The United States Government and the Government of ____________ 
have agreed to remove barriers to procurement at the prime and 
subcontract level for defense equipment produced in each other's 
countries insofar as laws and regulations permit.
    3. The agreement provides that competitive offers of (qualifying 
country) end products will be evaluated by the Department of Defense 
without imposing any price differential under the Buy American Act or 
Balance of Payments Program and without taking applicable U.S. customs 
and duties into consideration so that (qualifying country) items may 
better compete for sales of defense equipment to the Department of 
Defense. In addition, the Agreement stipulates that acquisitions of 
(qualifying country) items must fully satisfy Department of Defense 
requirements for performance, quality, and delivery and shall cost the 
Department of Defense no more than would comparable U.S. source or

[[Page 180]]

other foreign source defense equipment eligible for award.
    4. In order to achieve the above objectives, the solicitation 
contained the Buy American Act and Balance of Payments Program clause, 
252.225-7001. Offers were solicited from other sources and the offer 
received for (qualifying country end item) is found to be otherwise 
eligible for award.

                              Determination

    Pursuant to the Buy American Act and Balance of Payments Program, I 
hereby determine that it is inconsistent with the public interest to 
apply the restrictions of the Buy American Act or the Balance of 
Payments Program to the proposed offer.
 _______________________________________________________________________

    (Date)
[56 FR 36367, July 31, 1991, as amended at 57 FR 42630, Sept. 15, 1992]



225.872-5  Contract administration.

    (a) Arrangements exist with some qualifying countries to provide 
reciprocal contract administration services. Some arrangements are at no 
cost to either government. To determine whether such an arrangement has 
been negotiated and what contract administration functions are covered, 
contact the Deputy Director of Defense Procurement (Foreign 
Contracting), ((703) 697-9351, DSN 227-9351).
    (b) When contract administration services are required on contracts 
to be performed in qualifying countries, direct the request to the 
cognizant activity under DLAH 4105.4, section II, part 2 (DoD Directory 
of Contract Administration Services Components). Contract administration 
services for DoD subcontracts placed by qualifying country sources in 
the United States will be arranged by the cognizant activity under DLAH 
4105.4, section II, part 2.
    (c) The contract administration activity receiving a delegation or 
secondary delegation shall review the delegation to determine whether 
any portion of the delegation are covered by memoranda of understanding 
annexes, and delegate those functions to the appropriate organization in 
the qualifying country's government.
    (d) Information on quality assurance delegations to foreign 
governments is in subpart 246.4, Government Contract Quality Assurance.
[56 FR 36367, July 31, 1991, as amended at 60 FR 29498, June 5, 1995]



225.872-6  Audit.

    (a) Memoranda of understanding with some qualifying countries 
contain annexes that provide for reciprocal ``no-cost'' audits of 
contracts and subcontracts (pre- and post-award).
    (b) To determine if such an annex is applicable to a particular 
qualifying country, contact the Deputy Director of Defense Procurement 
(Foreign Contracting) ((703) 697-9351, DSN 227-9351).
    (c) Handle requests for audits in qualifying countries under 
215.805-5(c)(1).
    (1) Except for the United Kingdom (UK), send the request to the 
administrative contracting officer at the cognizant activity listed in 
DLAH 4105.4, section II, part 2 (DoD Directory of Contract 
Administration Services Components). Send the request for audit from the 
UK directly to their Ministry of Defence. See section VII, DLAH 4105.4 
for guidance.
    (2) Send an advance copy of the request to the focal point 
identified by the Foreign Contracting Directorate, Office of the 
Director of Defense Procurement.
[56 FR 36367, July 31, 1991, as amended at 60 FR 29498, June 5, 1995]



225.872-7  Industrial security for qualifying countries.

    The required procedures for safeguarding classified defense 
information necessary for the performance of contracts awarded to 
qualifying country sources are in the DoD Industrial Security Regulation 
DoD 5220.22-R (implemented for the Army by AR 380-49; for the Navy by 
OPNAV Instruction 5540.8L; for the Air Force by AFR 205-4; for the 
Defense Information Systems Agency by DCA Instruction 240-110-8; and for 
the Defense Mapping Agency by DMA Instruction 5220.22).
[56 FR 36367, July 31, 1991, as amended at 56 FR 67215, Dec. 30, 1991]

[[Page 181]]



225.872-8  Subcontracting with qualifying country sources.

    In reviewing contractor subcontracting procedures, the contracting 
officer shall ensure that the prime contract does not preclude 
qualifying country sources from competing for subcontracts, except when 
restricted by national security interest reasons, mobilization base 
considerations, or applicable U.S. laws or regulations. (See the clause 
at 252.225-7002, Qualifying Country Sources as Subcontractors.)



225.873  Waiver of United Kingdom commercial exploitation levies.



225.873-1  Policy.

    DoD and the Government of the United Kingdom (U.K.) have agreed to 
waive U.K. commercial exploitation levies and U.S. nonrecurring cost 
recoupment charges on a reciprocal basis. In order for U.K. levies to be 
waived, they must be identified and a waiver must be requested before 
award of the contract or subcontract under which the levies are charged.
[57 FR 53599, Nov. 12, 1992]



225.873-2  Procedures.

    (a) Waiver of U.K. levies must be approved by the Government of the 
U.K. When an offeror or contractor identifies a levy included in an 
offered or contract price, the contracting officer shall provide written 
notification to the Defense Security Assistance Agency, Operations 
Management Division, room 4B740, the Pentagon, Washington, DC 20301-
2800, telephone (703) 697-8108, which will request a waiver of the levy 
from the Government of the U.K. The notification shall include--
    (1) Name of the U.K. firm;
    (2) Prime contract number;
    (3) Description of item for which waiver is being sought;
    (4) Quantity being acquired; and
    (5) Amount of levy.
    (b) Waiver may occur after contract award. Where levies are waived 
before contract award, the offer will be evaluated without the levy. 
Where levies are identified but not waived before contract award, the 
offer will be evaluated inclusive of the levies.
[57 FR 53599, Nov. 12, 1992]



225.873-3  Contract clause.

    Use the clause at 252.225-7032, Waiver of United Kingdom Levies, in 
all solicitations and contracts for supplies--
    (a) Where U.K. firms are expected to participate as offerors/prime 
contractors; or
    (b) If a subcontract over $1 million with a U.K. firm is 
anticipated.
[57 FR 53599, Nov. 12, 1992]



          Subpart 225.9--Additional Foreign Acquisition Clauses



225.970  Clause deviations in overseas contracts.

    See 201.402(2) for approval authority for clause deviations in 
overseas contracts with governments of North Atlantic Treaty 
Organization (NATO) countries or other allies or with United Nations or 
NATO organizations.
[61 FR 50453, Sept. 26, 1996]



225.971  Correspondence in English.

    Use the clause at 252.225-7041, Correspondence in English, in 
solicitations and contracts when contract performance will be wholly or 
in part in a foreign country.
[62 FR 34123, June 24, 1997]



225.972  Authorization to perform.

    Use the clause at 252.225-7042, Authorization to Perform, in 
solicitations and contracts when contract performance will be wholly or 
in part in a foreign country.
[62 FR 34123, June 24, 1997]



   Subpart 225.70--Authorization Acts, Appropriations Acts, and Other 
              Statutory Restrictions on Foreign Acquisition



225.7000  Scope of subpart.

    (a) This subpart contains restrictions on the acquisition of foreign 
products and services, imposed by Defense appropriations and 
authorization acts and other statutes. Refer to the acts to verify 
current applicability of the restrictions.

[[Page 182]]

    (b) Nothing in this subpart affects the applicability of the Buy 
American Act or Balance of Payments Program.
[56 FR 36367, July 31, 1991, as amended at 62 FR 2856, Jan. 17, 1997]



225.7001  Definitions.

    As used in this subpart--
    (a) Bearing components and miniature and instrument ball bearings 
are defined in the clause at 252.225-7016, Restriction on Acquisition of 
Ball and Roller Bearings.
    (b) Hand or measuring tools means those tools listed in Federal 
supply classifications 51 and 52, respectively.
    (c) Possessions, as used in the phrase ``United States or its 
possessions,'' includes Puerto Rico.
    (d) Specialty metals is defined in the clause at 252.225-7014, 
Preference for Domestic Specialty Metals.
[61 FR 10899, Mar. 18, 1996, as amended at 61 FR 50453, Sept. 26, 1996]



225.7002-1  Restrictions.

    (a) In accordance with Section 9005 of Public Law 102-396, as 
amended (10 U.S.C. 2241 note, Limitations on Food, Clothing, and 
Specialty Metals Not Produced in the United States), and Section 8109 of 
Public Law 104-208, do not acquire supplies consisting in whole or in 
part of any of the following, that have not been grown or produced in 
the United States or its possessions--
    (1) Food, but this does not restrict acquisition of foods 
manufactured or processed in the United States or its possessions;
    (2) Clothing;
    (3) Tents, tarpaulins, or covers;
    (4) Cotton and other natural fiber products, or wool (whether in the 
form of fiber or yarn or contained in fabrics, materials, or 
manufactured articles), but this does not restrict acquisition of cotton 
or wool reprocessed or reused in the United States or its possessions;
    (5) Woven silk or woven silk blends;
    (6) Spun silk yarn for cartridge cloth;
    (7) Synthetic fabric or coated synthetic fabric, including all 
textile fibers and yarns that are for use in such fabrics;
    (8) Canvas products; or
    (9) Any item of individual equipment (Federal Supply Class 8465) 
manufactured from or containing any of the listed fibers, yarns, 
fabrics, or materials.
    (b) Do not acquire specialty metals, including stainless steel 
flatware, that were not melted in steel manufacturing facilities located 
within the United States or its possessions.
    (c) Do not acquire hand or measuring tools that were not produced in 
the United States or its possessions.
[56 FR 36367, July 31, 1991, as amended at 59 FR 27671, May 27, 1994; 62 
FR 5780, Feb. 7, 1997; 62 FR 47154, Sept. 8, 1997]



225.7002-2  Exceptions.

    Acquisitions in the following categories are not subject to the 
restrictions in 225.7002-1--
    (a) Any of the items in 225.7002-1(a) or (b), if the Secretary 
concerned, or designee, determines that they cannot be acquired when 
needed in a satisfactory quality and sufficient quantity grown or 
produced in the United States or its possessions at U.S. market prices.
    (b) Outside the United States--
    (1) In support of combat operations;
    (2) Perishable foods by activities located outside the United States 
for their personnel; or
    (3) Emergency acquisitions by such activities for their personnel.
    (c) Acquisitions by vessels in foreign waters.
    (d) Acquisitions of those supplies listed in FAR section 
25.108(d)(1), unless the supplies are hand or measuring tools.
    (e) Acquisitions not exceeding the simplified acquisition threshold.
    (f) Acquisitions of end items incidentally incorporating cotton or 
wool, for which the estimated value of the cotton or wool is not more 
than 10 percent of the total price of the end item; provided the 
estimated value of the cotton or wool does not exceed the simplified 
acquisition threshold.
    (g) Supplies purchased specifically for commissary resale.
    (h) Purchases of specialty metals by subcontractors at any tier for 
programs, except--
    (1) Aircraft;
    (2) Missile and space systems;

[[Page 183]]

    (3) Ships;
    (4) Tank-automotive;
    (5) Weapons; and
    (6) Ammunition.
    (i) Purchases of specialty metals and chemical warfare protective 
clothing when the acquisition furthers an agreement with a qualifying 
country (see section 225.872).
    (j) Purchases of fibers and yarns that are for use in synthetic 
fabric or coated synthetic fabric (but not the purchase of the synthetic 
or coated synthetic fabric itself), if such fabric is to be used as a 
component of an end item that is not a textile product. Examples of 
textile products, made in whole or in part of fabric, include--
    (1) Draperies, floor coverings, furnishings, and bedding (Federal 
Supply Group 72, Household and Commercial Furnishings and Appliances);
    (2) Items made in whole or in part of fabric in Federal Supply Group 
83, Textile/leather/furs/apparel/findings/tents/flags, or Federal Supply 
Group 84, Clothing, Individual Equipment and Insignia;
    (3) Upholstered seats (whether for household, office, or other use); 
and
    (4) Parachutes (Federal Supply Class 1670).
[56 FR 36367, July 31, 1991, as amended at 58 FR 28467, May 13, 1993; 59 
FR 27671, May 27, 1994; 60 FR 61597, Nov. 30, 1995; 61 FR 50453, Sept. 
26, 1996; 62 FR 5780, Feb. 7, 1997; 62 FR 47154, Sept. 8, 1997]



225.7002-3  Contract clauses.

    Unless an exception is known to apply--
    (a) Use the clause at 252.225-7012, Preference for Certain Domestic 
Commodities, in all solicitations and contracts which meet or exceed the 
simplified acquisition threshold.
    (b) Use the clause at 252.225-7014, Preference for Domestic 
Specialty Metals, in all solicitations and contracts over the simplified 
acquisition threshold that require delivery of an article containing 
specialty metals. Use the clause with its Alternate I in all 
solicitations and contracts over the simplified acquisition threshold 
requiring delivery, for one of the following major programs, of an 
article containing specialty metals--
    (1) Aircraft;
    (2) Missile and space systems;
    (3) Ships;
    (4) Tank-automotive;
    (5) Weapons; or
    (6) Ammunition.
    (c) Use the clause at 252.225-7015, Preference for Domestic Hand or 
Measuring Tools, in all solicitations and contracts over the simplified 
acquisition threshold calling for delivery of hand or measuring tools.
[61 FR 50453, Sept. 26, 1996]



225.7003  Restriction on overseas military construction.

    For restriction on award of military construction contracts to be 
performed in the United States territories and possessions in the 
Pacific and on Kwajalein Atoll, or in countries bordering the Arabian 
Gulf, see 236.274(a).
[62 FR 2856, Jan. 17, 1997]



225.7004  Restriction on overseas architect-engineer services.

    For restriction on award of architect-engineer contracts to be 
performed in Japan, in any North Atlantic Treaty Organization member 
country, or in countries bordering the Arabian Gulf, see 236.602-70.
[62 FR 2857, Jan. 17, 1997]



225.7005  Waiver of certain restrictions.

    (a) The Secretary of Defense has waived the restrictions of 10 
U.S.C. 2534(a) for the acquisition of defense items manufactured in a 
qualifying country listed in 225.872-1, in accordance with the 
provisions of 10 U.S.C. 2534(d)(3).
    (b) Where provided for elsewhere in this subpart, the restrictions 
on certain foreign purchases under 10 U.S.C. 2534(a) may be waived as 
follows:
    (1) The head of the contracting activity may waive the restriction 
on a case-by-case basis upon execution of a determination and findings 
that any of the following applies:
    (i) The restriction would cause unreasonable dalays.
    (ii) United States producers of the item would not be jeopardized by 
competition from a foreign country, and that country does not 
discriminate against defense items produced in

[[Page 184]]

the United States to a greater degree than the United States 
discriminates against defense items produced in that country.
    (iii) Application of the restriction would impede cooperative 
programs entered into between DoD and a foreign country, and that 
country does not discriminate against defense items produced in the 
United States to a greater degree than the United States discriminates 
against defense items produced in that country.
    (iv) Satisfactory quality items manufactured in the United States or 
Canada are not available.
    (v) Application of the restriction would result in the existence of 
only one source for the item in the United States or Canada.
    (vi) Application of the restriction is not in the national security 
interests of the United States.
    (vii) Application of the restriction would adversely affect a U.S. 
company.
    (2) The restriction is waived when it would cause unreasonable 
costs. The cost of the item of U.S. or Canadian origin is unreasonable 
if it exceeds 150 percent of the offered price, inclusive of duty, of 
items which are not of U.S. or Canadian origin.
[62 FR 34123, June 24, 1997]



225.7006  Restrictions on construction or repair of vessels in foreign shipyards.

    10 U.S.C. 7309 restricts constructing or repairing vessels in 
foreign shipyards.
    (a) Do not award a contract to construct either of the following in 
a foreign shipyard--
    (1) A vessel constructed for any of the armed forces; or
    (2) A major component of the hull or superstructure of any such 
vessel.
    (b) Do not overhaul, repair, or maintain in a foreign shipyard, a 
naval vessel (or any other vessel under the jurisdiction of the 
Secretary of the Navy) homeported in the United States. This restriction 
does not apply to voyage repairs.



225.7007  Restriction on acquisition of foreign buses.



225.7007-1  Restriction.

    In accordance with 10 U.S.C. 2534 and 225.7005(a), do not acquire a 
multipassenger motor vehicle (bus) unless it is manufactured in the 
United States or a qualifying country.
[62 FR 34123, June 24, 1997]



225.7007-2  Applicability.

    Apply this restriction if the buses are purchased, leased, rented, 
or made available under contracts for transportation services.
[60 FR 19533, Apr. 19, 1995]



225.7007-3  Exceptions.

    This restriction does not apply in any of the following 
circumstances:
    (a) Buses manufactured in nonqualifying countries are needed for 
temporary use because buses manufactured in the United States or a 
qualifying country are not available to satisfy requirements that cannot 
be postponed. Such use may not, however, exceed the lead time required 
for acquisition and delivery of buses manufactured in the United States 
or a qualifying country.
    (b) The requirement for buses is temporary in nature. For example, 
to meet a special, nonrecurring requirement or a sporadic and infrequent 
recurring requirement, buses manufactured in nonqualifying countries may 
be used for temporary periods of time. Such use may not, however, exceed 
the period of time needed to meet the special requirement.
    (c) Buses manufactured in nonqualifying countries are available at 
no cost to the U.S. Government.
    (d) The acquisition is for an amount that does not exceed the 
simplified acquisition threshold.
[62 FR 34123, June 24, 1997]



225.7007-4  Waiver.

    The waiver criteria at 225.7005(b) apply to this restriction.
[62 FR 34123, June 24, 1997]

[[Page 185]]



225.7008  Restriction on research and development.

    (a) Public Law 92-570 precludes use of DoD appropriations for award 
to any foreign corporation, organization, person, or entity for research 
and development in connection with any weapon system or other military 
equipment if there is a U.S. corporation, organization, person, or 
entity--
    (1) Equally competent; and
    (2) Willing to perform at a lower cost.
    (b) The statutory restriction in paragraph (a) of this section does 
not change the rules for selecting research and development contractors 
in FAR part 35. However, when a U.S. source and a foreign source are 
equally competent, award to the source that will provide the services at 
the lower cost.



225.7009  [Reserved]



225.7010  Restriction on certain chemical weapons antidote.



225.7010-1  Restriction.

    In accordance with 10 U.S.C. 2534 and defense industrial 
mobilization requirements (see subpart 208.72), do not acquire chemical 
weapons antidote contained in automatic injectors, or the components for 
such injectors, unless the injector or component is manufactured in the 
United States or Canada by a company that--
    (a) Is a producer under the industrial preparedness program at the 
time of contract award;
    (b) Has received all required regulatory approvals; and
    (c) Has the plant, equipment, and personnel to perform the contract 
in the United States or Canada at the time of contract award.
[60 FR 19533, Apr. 19, 1995, as amended at 62 FR 34123, June 24, 1997]



225.7010-2  Exception.

    In accordance with 10 U.S.C. 2534(g) and 225.7005(a), the 
restriction of 225.7010-1 does not apply to the acquisition of 
quantities of chemical weapons antidote contained in automatic 
injectors, or the components for such injectors, that exceed the amount 
needed to maintain the U.S. defense mobilization base (provided such 
quantity is an economical purchase quantity), if--
    (a) The acquisition is for an amount that does not exceed the 
simplified acquisition threshold; or
    (b) The chemical weapons antidote contained in automatic injectors, 
or the components for such injectors are manufactured in a qualifying 
country.
[62 FR 34123, June 24, 1997]



225.7010-3  Waiver.

    The waiver criteria at 225.7005(b) apply to this restriction.
[62 FR 34123, June 24, 1997]



225.7011  Restriction on Ballistic Missile Defense research, development, test, and evaluation.



225.7011-1  Definitions.

    Competent, foreign firm, and U.S. firm have the meanings given in 
the provision at 252.225-7018, Notice of Prohibition of Certain 
Contracts with Foreign Entities for the Conduct of Ballistic Missile 
Defense RDT&E.
[56 FR 36367, July 31, 1991, as amended at 59 FR 27672, May 27, 1994]



225.7011-2  Restriction.

    (a) Section 222 of the Defense Authorization Act for FY1988 and 1989 
(Pub. L. 100-180) prohibits the award of certain contracts for the 
conduct of Ballistic Missile Defense (BMD) Program research, 
development, test, and evaluation (RDT&E), to foreign governments or 
firms unless the Secretary of Defense certifies to Congress in writing 
at any time during the applicable fiscal year that work cannot be 
competently performed by a U.S. firm at a price equal to or less than 
the price of the foreign government or firm.
    (b) For purposes of implementing this section, heads of contracting 
activities are authorized to make this certification (see 225.7011-
3(b)).
    (c) Except as provided in 225.7011-3, do not use any funds 
appropriated to, or for the use of, DoD to enter into or carry out any 
contract, including any contract awarded as a result of a broad agency 
announcement, with a foreign government or firm if the contract provides 
for the conduct of RDT&E in connection with the BMD.

[[Page 186]]

    (d) This prohibition is not intended to deny access to foreign 
expertise when contract performance requires a level of competency 
unavailable in the United States.
[56 FR 36367, July 31, 1991, as amended at 59 FR 27672, May 27, 1994]



225.7011-3  Exceptions.

    This prohibition shall not apply--
    (a) To contracts awarded to a foreign government or firm if the 
contracting officer determines that--
    (1) The contract will be performed within the United States;
    (2) The contract is exclusively for RDT&E in connection with 
antitactical ballistic missile systems; or
    (3) The foreign government or foreign firm agrees to share a 
substantial portion of the total contract cost. Consider the foreign 
share as substantial if it is equitable with respect to the relative 
benefits to be derived from the contract by the United States and the 
foreign parties. For example, if the contract is more beneficial to the 
foreign party, its share of the cost should be correspondingly higher; 
or
    (b) If the head of the contracting activity certifies in writing, 
before contract award, that a contract for research, development, 
testing, or evaluation (other than for RDT&E described in paragraph 
(a)(2) of this subsection) cannot be competently performed by a U.S. 
firm at a price equal to or less than the price at which the RDT&E would 
be performed by a foreign government or firm.



225.7011-4  Procedures.

    (a) When awarding a prime contract to a foreign government or firm 
under 225.7011-3(b), the contracting officer or source selection 
authority, as applicable, shall make a determination that will be the 
basis for the certification.
    (1) The determination must--
    (i) Describe the contract effort;
    (ii) State the number of proposals solicited and received from both 
U.S. and foreign firms;
    (iii) Identify the proposed awardee and the amount of the contract;
    (iv) State that selection of the contractor was based on the 
evaluation factors contained in the solicitation, or the criteria 
contained in the broad agency announcement; and
    (v) State that the effort cannot be competently performed by a U.S. 
firm at a price equal to, or less than, the price at which it would be 
performed by the foreign awardee.
    (2) When either a broad agency announcement (BAA) or program 
research and development announcement (PRDA) is used, or when the 
determination is otherwise not based on direct competition between 
foreign and domestic proposals, the determination must not be merely 
conclusory.
    (i) The determination must specifically explain its basis, include a 
description of the method used to determine the competency of U.S. 
firms, and describe the cost or price analysis performed.
    (ii) Alternately, the determination may contain--
    (A) A finding, including the basis for such finding, that the 
proposal was submitted solely in response to the terms of a BAA or PRDA, 
or other solicitation document without any technical guidance from the 
program office; and
    (B) A finding, including the basis for such finding, that disclosure 
of the information in the proposal for the purpose of conducting a 
competitive acquisition is prohibited.
    (b) Forward a copy of the certification (from 225.7011-3(b)) and, as 
appropriate, the determination or justification and approval (J&A) 
within 30 days of contract award to the Ballistic Missile Defense 
Organization, Attn: BMDO/DRI, 7100 Defense Pentagon, Washington, DC 
20301-7100, if award is based on--
    (1) A determination under paragraph (a) of this subsection;
    (2) Other than full and open competition under FAR subpart 6.3; or
    (3) An unsolicited proposal under FAR subpart 15.5.
[56 FR 36367, July 31, 1991, as amended at 59 FR 27672, May 27, 1994; 61 
FR 50453, Sept. 26, 1996]



225.7011-5  Solicitation provision.

    Use the provision at 252.225-7018, Notice of Prohibition of Certain 
Contracts With Foreign Entities for the Conduct of Ballistic Missile 
Defense RDT&E, in

[[Page 187]]

all competitively negotiated BMD solicitations for research, 
development, test, and evaluation, unless foreign participation is 
otherwise excluded.
[56 FR 36367, July 31, 1991, as amended at 59 FR 27672, May 27, 1994]



225.7012  Restrictions on anchor and mooring chain.



225.7012-1  Restrictions.

    (a) Under Public Law 101-511, Section 8041, and similar sections in 
subsequent Defense appropriations acts, DoD appropriations for fiscal 
years 1991 and after may not be used to acquire welded shipboard anchor 
and mooring chain, four inches in diameter and under, unless--
    (1) It is manufactured in the United States, including cutting, heat 
treating, quality control, testing, and welding (both forging and shot 
blasting process); and
    (2) The cost of the components manufactured in the United States 
exceeds 50 percent of the total cost of components.
    (b) Acquisition of welded shipboard anchor and mooring chain, four 
inches in diameter and under, when used as a component of a naval 
vessel, is also restricted under 10 U.S.C. 2534(a)(3)(ii). However, the 
more stringent restriction under 225.7012-1(a) takes precedence.
[61 FR 13107, Mar. 26, 1996]



225.7012-2  Waiver.

    The restriction in 225.7012-1(a) may be waived by the Secretary of 
the Department responsible for acquisition, on a case-by-case basis, 
where sufficient domestic suppliers are not available to meet DoD 
requirements on a timely basis and the acquisition is necessary to 
acquire capability for national security purposes.
    (a) Document the waive in a written D&F containing--
    (1) The factors supporting the waiver; and
    (2) A certification that the acquisition must be made in order to 
acquire capability for national security purposes.
    (b) Provide a copy of the D&F to the House and Senate Committees on 
Appropriations.
[61 FR 13107, Mar. 26, 1996]



225.7012-3  Contract clause.

    Use the clause at 252.225-7019, Restriction on Acquisition of 
Foreign Anchor and Mooring Chain, in all solicitations and contracts--
    (a) Using fiscal year 1991 or later funds; and
    (b) Requiring welded shipboard anchor or mooring chain of four 
inches in diameter or less.
[61 FR 13107, Mar. 26, 1996, as amended at 61 FR 50453, Sept. 26, 1996]



225.7013--225.7014  [Reserved]



225.7015  Restriction on night vision image intensifier tubes and devices.



225.7015-1  Restriction.

    In accordance with Pub. L. 101-165 and 101-511, fiscal years 1990 
and 1991 funds may not be used to acquire second and third generation 
night vision image intensifier tubes and devices unless they are 
manufactured in the United States or Canada.
[58 FR 28467, May 13, 1993]



225.7015-2  Exception.

    Second and third generation night vision image intensifier tubes and 
devices manufactured outside the United States or Canada may be acquired 
if--
    (a) Adequate domestic supplies are not available to meet DoD 
requirements on a timely basis; and
    (b) The Secretary of the Department responsible for the acquisition 
certifies to the House and Senate Committees on Appropriations that the 
acquisition of tubes and devices manufactured outside the United States 
or Canada is necessary in order to acquire capability for national 
security purposes.



225.7015-3  Contract clause.

    Use the clause at 252.225-7024, Restriction on Acquisition of Night 
Vision Image Intensifier Tubes and Devices, in all solicitations and 
contracts which--
    (a) Use fiscal year 1990 or 1991 funds; and

[[Page 188]]

    (b) Require second and third generation night vision image 
intensifier tubes and devices.
[58 FR 28467, May 13, 1993]



225.7016  Restriction on air circuit breakers for naval vessels.



225.7016-1  Restriction.

    In accordance with 10 U.S.C. 2534 and 225.7005(a), do not acquire 
air circuit breakers for naval vessels unless they are manufactured in 
the United States or a qualifying country.
[62 FR 34123, June 24, 1997]



225.7016-2  Exceptions.

    This restriction does not apply if--
    (a) The acquisition is for an amount that does not exceed the 
simplified acquisition threshold; or
    (b) Spare or repair parts are needed to support air circuit breakers 
manufactured in a nonqualifying country. Support includes the purchase 
of spare air circuit breakers where those from alternate sources are not 
interchangeable.
[62 FR 34124, June 24, 1997]



225.7016-3  Waiver.

    The waiver criteria at 225.7005(b) apply to this restriction.
[62 FR 34124, June 24, 1997]



225.7016-4  Contract clause.

    Use the clause at 252.225-7029, Preference for United States or 
Canadian Air Circuit Breakers, in all solicitations and contracts 
requiring air circuit breakers for naval vessels, unless--
    (a) An exception under 225.7016-2 is known to apply; or
    (b) A waiver has been granted in accordance with 225.7016-3.
[60 FR 19534, Apr. 19, 1995]



225.7017  Restriction on carbon, alloy, and armor steel plate.



225.7017-1  Restriction.

    In accordance with section 8111 of Pub. L. 102-172, and similar 
sections in subsequent appropriations acts, all carbon, alloy, and armor 
steel plate in Federal stock class 9515 or described by American Society 
for Testing Materials (ASTM) or American Iron and Steel Institute (AISI) 
specifications, purchased by the Government or a contractor for use in a 
Government-owned facility or in a facility controlled (e.g., leased) by 
DoD, shall be melted and rolled in the United States or Canada.
[58 FR 28468, May 13, 1993]



225.7017-2  Exceptions.

    This restriction does not apply to--
    (a) Contracts in effect as of November 26, 1991;
    (b) Direct purchases by DoD using other than fiscal year 1992 or 
subsequent year funds; or
    (c) Purchases by contractors unless the prime contract uses fiscal 
year 1992 or subsequent year funds.
[58 FR 28468, May 13, 1993]



225.7017-3  Waiver.

    The restriction may be waived by the Secretary of the department 
responsible for acquisition, on a case-by-case, by certifying to the 
House and Senate Committees on Appropriations that--
    (a) Adequate U.S. or Canadian supplies are not available to meet DoD 
requirements on a timely basis; and
    (b) The acquisition must be made in order to acquire capability for 
national security purposes.
[57 FR 14994, Apr. 23, 1992]



225.7017-4  Contract clause.

    Unless an exception under 225.7017-2 is known to apply or a waiver 
has been granted in accordance with 225.7017-3, use the clause at 
252.225-7030, Restriction on Acquisition of Carbon, Alloy, and Armor 
Steel Plate, in all solicitations and contracts which--
    (a) Require the delivery to the Government of carbon, alloy, or 
armor steel plate which will be used in a facility owned by the 
Government or under the control of DoD; or
    (b) Require contractors operating in a Government-owned facility or 
a facility under the control of DoD to purchase carbon, alloy, or armor 
steel plate.
[57 FR 14994, Apr. 23, 1992, as amended at 57 FR 53600, Nov. 12, 1992]

[[Page 189]]



225.7018  Restriction on four ton dolly jacks.



225.7018-1  Restriction.

    In accordance with section 9108 of Public Law 102-396, no fiscal 
year 1993 funds shall be used to procure four ton dolly jacks 
manufactured outside the United States.
[59 FR 27672, May 27, 1994]



225.7018-2  Waiver.

    The restriction is 225.7018-1 may be waived on a case-by-case basis 
where the Secretary of the Military Department or the Under Secretary of 
Defense (Acquisition & Technology) certifies to the Committees on 
Appropriations of the House and Senate that--
    (a) Adequate domestic supplies are available to meet requirements on 
a timely basis; and
    (b) The acquisition must be made in order to acquire capability for 
national security purposes.
[58 FR 28468, May 13, 1993, as amended at 60 FR 61597, Nov. 30, 1995]



225.7018-3  Contract clause.

    Use the clause at section 252.225-7033, Restriction on Acquisition 
of Four Ton Dolly Jacks, in solicitations and contracts that use fiscal 
year 1993 funds for the acquisition of four ton dolly jacks.
[59 FR 27672, May 27, 1994]



225.7019  Restrictions on ball and roller bearings.



225.7019-1  Restrictions.

    (a) In accordance with 10 U.S.C. 2534 and 225.7005(a), through 
fiscal year 2000, do not acquire ball and roller bearings or bearing 
components that are not manufactured in the United States or a 
qualifying country.
    (b) In accordance with Section 8099 of Public Law 104-61 and similar 
sections in subsequent Defense appropriations acts, do not use fiscal 
year 1996 or subsequently appropriated funds to acquire ball and roller 
bearings other than those produced by a domestic source and of domestic 
origin, i.e., bearings and bearing components manufactured in the United 
States or Canada.
[61 FR 10900, Mar. 18, 1996, as amended at 61 FR 58489, Nov. 15, 1996; 
62 FR 34124, June 24, 1997]



225.7019-2  Exceptions.

    (a) The restriction in 225.7019-1(a) does not apply to--
    (1) Acquisitions using simplified acquisition procedures, unless 
ball or roller bearings or bearing components are the end items being 
purchased;
    (2) Purchases of commercial items incorporating ball or roller 
bearings;
    (3) Miniature and instrument ball bearings when necessary to meet 
urgent military requirements;
    (4) Items acquired overseas for use overseas; or
    (5) Ball and roller bearings or bearing components or items 
containing bearings for use in a cooperative or co-production project 
under an international agreement. This exception does not apply to 
miniature and instrument ball bearings.
    (b) The restriction in 225.7019-1(b) does not apply to contracts for 
acquisition of commercial items or subcontracts for acquisition of 
commercial items or subcontracts for acquisition of commercial items or 
commercial components (see 212.503(a)(xi) and 212.504(a)(xxxvi)).
[61 FR 50453, Sept. 26, 1996]



225.7019-3  Waiver.

    (a) The head of the contracting activity may waive the restriction 
in 225.7019-1(a)--
    (1) Upon execution of a determination and findings that--
    (i) No domestic (U.S. or Canadian) bearing manufacturer meets the 
requirement;
    (ii) It is not in the best interests of the United States to qualify 
a domestic bearing to replace a qualified nondomestic bearing. This 
determination must be based on a finding that the qualification of a 
domestically manufactured bearing would cause unreasonable costs or 
delay. A finding that a cost is unreasonable should take into 
consideration DoD policy to assist the domestic industrial mobilization 
base.

[[Page 190]]

Contracts should be awarded to domestic bearing manufacturers to 
increase their capability to reinvest and become more competitive;
    (iii) United States producers of the item would not be jeopardized 
by competition from a foreign country, and that country does not 
discriminate against defense items produced in the United States to a 
greater degree than the United States discriminates against defense 
items produced in that country;
    (iv) Application of the restriction would impede cooperative 
programs entered into between DoD and a foreign country, and that 
country does not discriminate against defense items produced in the 
United States to a greater degree than the United States discriminates 
against defense items produced in that country;
    (v) Application of the restriction would result in the existence of 
only one source for the item in the United States or Canada;
    (vi) Application of the restriction is not in the national security 
interests of the United States; or
    (vii) Application of the restriction would adversely affect a U.S. 
company.
    (2) If the acquisition is for an amount less than the simplified 
acquisition threshold and simplified acquisition procedures are being 
used.
    (3) For multiyear contracts or contracts exceeding 12 months, except 
those for miniature and instrument ball bearings, only if--
    (i) The head of the contracting activity executes a determination 
and findings in accordance with paragraph (a) of this subsection;
    (ii) The contractor submits a written plan for transitioning from 
the use of nondomestic to domestically manufactured bearings;
    (iii) The plan--
    (A) States whether a domestically manufactured bearing can be 
qualified, at a reasonable cost, for use during the course of the 
contract period;
    (B) Identifies any bearings that are not domestically manufactured, 
their application, and source of supply; and
    (C) Describes, including cost and timetable, the transition to a 
domestically manufactured bearing. (The timetable for the transition 
should normally take no longer than 24 months from the date the waiver 
is granted); and
    (iv) The contracting officer accepts the plan and incorporates it in 
the contract.
    (4) For miniature and instrument ball bearings, only if the 
contractor agrees to acquire a like quantity and type of domestic 
manufacture for nongovernmental use.
    (b) The Secretary of the department responsible for the acquisition 
may waive the restriction in 225.7019-1(b) on a case-by-case basis, by 
certifying to the House and Senate Committees on Appropriations that--
    (1) Adequate domestic supplies are not available to meet DoD 
requirements on a timely basis; and
    (2) The acquisition must be made in order to acquire capability for 
national security purposes.
[61 FR 10900, Mar. 18, 1996, as amended at 61 FR 50453, Sept. 26, 1996; 
62 FR 34124, June 24, 1997]



225.7019-4  Contract clause.

    Use the clause at 252.225-7016, Restriction on Acquisition of Ball 
and Roller Bearings, in all solicitations and contracts, unless--
    (a) The restrictions in 225.7019-1 do not apply or a waiver has been 
granted; or
    (b) The contracting officer knows that the items being acquired do 
not contain ball or roller bearings.
[61 FR 10900, Mar. 18, 1996]



225.7020  [Reserved]



225.7021  Restriction on aircraft fuel cells.



225.7021-1  Restriction.

    In accordance with section 8090 of the Fiscal Year 1994 Defense 
Appropriations Act (Pub. L. 103-139) and section 8075 of the Fiscal Year 
1995 Defense Appropriations Act (Pub. L. 103-335), do not purchase 
aircraft fuel cells unless they are produced or manufactured in the 
United States by a domestic-operated entity.
[60 FR 29498, June 5, 1995]

[[Page 191]]



225.7021-2  Waiver.

    The restriction may be waived by the Secretary of the department 
responsible for the acquisition, on a case-by-case basis, by certifying 
to the House and Senate Committees on Appropriations that--
    (a) Adequate U.S. supplies are not available to meet requirements on 
a timely basis; and
    (b) The acquisition must be made in order to acquire capability for 
national security purposes.
[59 FR 11729, Mar. 14, 1994]



225.7021-3  Contract clause.

    Unless a waiver has been granted in accordance with 225.7021-2, use 
the clause at 252.225-7038, Restriction on Acquisition of Aircraft Fuel 
Cells, in all solicitations and contracts which--
    (a) Use fiscal year 1994 or 1995 funds; and
    (b) Require delivery of aircraft fuel cells.
[60 FR 29498, June 5, 1995]



225.7022  Restrictions on totally enclosed lifeboat survival systems.



225.7022-1  Restrictions.

    (a) In accordance with Section 8124 of the Fiscal Year 1994 Defense 
Appropriations Act (Public Law 103-139) and Section 8093 of the Fiscal 
Year 1995 Defense Appropriations Act (Public Law 103-335), do not 
purchase a totally enclosed lifeboat survival system, which consists of 
the lifeboat and associated davits and winches, unless 50 percent or 
more of the components are manufactured in the United States, and 50 
percent or more of the labor in the final manufacture and assembly of 
the entire system is performed in the United States.
    (b) In accordance with 10 U.S.C. 2534(a)(3)(B) and 225.7005(a), do 
not purchase a totally enclosed lifeboat that is a component of a naval 
vessel, unless it is manufactured in the United States or a qualifying 
country. In accordance with 10 U.S.C. 2534(h), this restriction may not 
be implemented through the use of a contract clause or certification. 
Implementation shall be effected through management and oversight 
techniques that achieve the objective of the restriction without 
imposing a significant management burden on the Government or the 
contractor involved.
[61 FR 13107, Mar. 26, 1996, as amended at 62 FR 34124, June 24, 1997]



225.7022-2  Exceptions.

    The restriction in 225.7022-1(b) does not apply if--
    (a) The acquisition is for an amount that does not exceed the 
simplified acquisition threshold; or
    (b) Spare or repair parts are needed to support totally enclosed 
lifeboats manufactured in a nonqualifying country.
[62 FR 34124, June 24, 1997]



225.7022-3  Waiver.

    The waiver criteria at 225.7005(b) apply only to the restriction of 
225.7022-1(b).
[62 FR 34124, June 24, 1997]



225.7022-4  Contract clause.

    Use the clause at 252.225-7039, Restriction on Acquisition of 
Totally Enclosed Lifeboat Survival Systems, in all solicitations and 
contracts which require delivery of totally enclosed lifeboat survival 
systems.
[61 FR 13107, Mar. 26, 1996]



225.7023  Restriction on supercomputers.



225.7023-1  Restriction.

    In accordance with section 8112 of Pub. L. 100-202, and similar 
sections in subsequent Defense Appropriations Acts, do not purchase any 
supercomputer that is not manufactured in the United States.
[60 FR 34471, July 3, 1995, as amended at 60 FR 61597, Nov. 30, 1995]



225.7023-2  Waiver.

    The restriction in 225.7023-1 may be waived by the Secretary of 
Defense on a case-by-case basis, after the Secretary of Defense 
certifies to the Armed Services and Appropriations Committees of 
Congress that--
    (a) Adequate U.S. supplies are not available to meet requirements on 
a timely basis; and

[[Page 192]]

    (b) The acquisition must be made in order to acquire capability for 
national security purposes.
[60 FR 34471, July 3, 1995]



225.7023-3  Contract clause.

    Use the clause at 252.225-7011, Restriction on Acquisition of 
Supercomputers, in solicitations and contracts for the acquisition of 
supercomputers.
[60 FR 34471, July 3, 1995, as amended at 60 FR 61597, Nov. 30, 1995]



        Subpart 225.71--Other Restrictions on Foreign Acquisition

    Source: 62 FR 34124, June 24, 1997, unless otherwise noted.



225.7100  Scope of subpart.

    This subpart contains foreign product restrictions which are based 
on policies designed to protect the defense industrial base.



225.7101  Definitions.

    Relevant definitions are in the clause at 252.225-7025, Restriction 
on Acquisition of Forgings.



225.7102  Forgings.



225.7102-1  Policy.

    DoD requirements for the following forging items, whether as end 
items or components, shall be acquired from domestic sources (as 
described in the clause at 252.225-7025) to the maximum extent 
practicable--

                                                                        
------------------------------------------------------------------------
                   Items                             Categories         
------------------------------------------------------------------------
Ship propulsion shafts....................  Excludes service and landing
                                             craft shafts.              
Periscope tubes...........................  All.                        
Ring forgings for bull gears..............  All greater than 120 inches 
                                             in diameter.               
------------------------------------------------------------------------



225.7102-2  Exceptions.

    The policy in 225.7102-1 does not apply to acquisitions--
    (a) Using simplified acquisition procedures, unless the restricted 
item is the end item being purchased;
    (b) Overseas for overseas use; or
    (c) When the quantity acquired exceeds the amount needed to maintain 
the U.S. defense mobilization base (provided such quantity is an 
economical purchase quantity). The restriction to domestic sources does 
not apply to the quantity above that required to maintain the base, in 
which case, qualifying country sources may compete.



225.7102-3  Waiver.

    Upon request from a prime contractor, the contracting officer may 
waive the requirement for domestic manufacture of the items covered by 
the policy in 225.7102-1.



225.7102-4  Contract clause.

    (a) Use the clause at 252.225-7025, Restriction on Acquisition of 
Forgings, in solicitations and contracts, except for acquisitions--
    (1) Excepted in 225.7102-2; or
    (2) Where the contracting officer knows that the supplies being 
acquired do not contain the restricted items.
    (b) If an exception under 225.7102-2 applies to any portion of the 
acquisition, specify the exception in the solicitation and contract.



225.7103  Polyacrylonitrile (PAN) carbon fiber.



225.7103-1  Policy.

    All new major systems must use U.S. or Canadian manufacturers or 
producers for all PAN carbon fiber requirements.



225.7103-2  Waivers.

    Contracting officers may, with the approval of the chief of the 
contracting office, waive, in whole or in part, the requirement of the 
clause at 252.225-7022. For example, a waiver may be justified if a 
qualified U.S. or Canadian source cannot meet scheduling requirements.



225.7103-3  Contract clause.

    Use the clause at 252.225-7022, Restriction on Acquisition of 
Polyacrylonitrile (PAN) Carbon Fiber, in all acquisitions for major 
systems (as defined in FAR part 2) that are not yet in production 
(milestone III as defined in DoD 50002.2-R, Mandatory Procedures for 
Major Defense Acquisition

[[Page 193]]

Programs (MDAPS) and Major Automated Information system (MAIS) 
Acquisition Programs). Also use the clause in contracts for major 
systems if the clause was used in prior program contracts.



Subpart 225.72--Reporting Contract Performance Outside the United States

    Source:  58 FR 28469, May 13, 1993, unless otherwise noted.



225.7200  Scope of subpart.

    This subpart prescribes procedures for contractor reporting and DoD 
monitoring of the volume, type, and nature of contract performance 
outside the United States, to include subcontracts, purchases, and 
intracompany transfers. It implements 10 U.S.C. 2410g which requires 
advance notification of contract performance outside the United States 
and Canada when the contract could have been performed inside the United 
States or Canada.



225.7201  Exception.

    This subpart does not apply to contracts for commercial items, 
construction, ores, natural gas, utilities, petroleum products and 
crudes, timber (logs), or subsistence.
[60 FR 61597, Nov. 30, 1995]



225.7202  Distribution of reports.

    The contracting officer shall forward a copy of reports submitted by 
successful offerors as required by the clause at 252.225-7026, Reporting 
of Contract Performance Outside the United States, to the Deputy 
Director of Defense Procurement (Foreign Contracting), OUSD(A&T)DP(FC), 
Washington, DC 20301-3060. This is necessary to satisfy the requirement 
of 10 U.S.C. 2410g that the notifications (or copies) be maintained in 
compiled form for five years after the date of submission.
[58 FR 28469, May 13, 1993, as amended at 60 FR 29499, June 5, 1995]



225.7203  Contract clause.

    Except for acquisitions in 225.7201, use the clause at 252.225-7026, 
Reporting of Contract Performance Outside the United States, in all 
solicitations and contracts with an estimated or actual value exceeding 
$500,000, including those modified to exceed $500,000.



         Subpart 225.73--Acquisitions for Foreign Military Sales



225.7300  Scope of subpart.

    (a) This subpart contains policies and procedures for acquisitions 
for foreign military sales (FMS) under the Arms Export Control Act. 
Section 22 of the Arms Export Control Act (Pub. L. 90-629, as amended) 
authorizes DoD to enter into contracts for resale to foreign countries 
or international organizations.
    (b) This subpart does not apply to--
    (1) Foreign military sales made from inventories or stocks;
    (2) Acquisitions for replenishment of inventories or stocks;
    (3) Acquisitions made under DoD cooperative logistic supply support 
arrangements.



225.7301  General.

    (a) The U.S. Government sells defense articles and services to 
foreign governments or international organizations through foreign 
military sales (FMS) agreements. The agreement is documented on a DD 
Form 1513, DoD Offer and Acceptance. The DD Form 1513--
    (1) Lists the items and services, estimated costs, and terms and 
conditions of the sale;
    (2) Is presented to the foreign customer; and
    (3) Provides for signature of the foreign customer to indicate 
acceptance.
    (b) Acquisitions for FMS are conducted under the same acquisition 
and contract management procedures as other defense acquisitions.
    (c) Solicitations shall separately identify known FMS requirements 
and the FMS customer.
    (d) Contracts for known FMS requirements shall clearly be marked 
``FMS requirement'' on the face of the contract along with the FMS 
customer and the case identifier code.



225.7302  Procedures.

    On FMS programs that will require an acquisition, the contracting 
officer

[[Page 194]]

assists the departmental/agency activity responsible for preparing the 
DoD Offer and Acceptance by--
    (a) Working with prospective contractors to--
    (1) Identify, in advance of the DoD Offer and Acceptance, any 
unusual provisions or deviations.
    (2) Advise the contractor if the departmental/agency activity 
expands, modifies, or does not accept any requirements proposed by the 
contractor;
    (3) Identify any logistics support necessary to perform the 
contract; and
    (4) For acquisitions over $10,000 that are to be awarded 
noncompetitively, asking the prospective contractor(s) for information 
on price, delivery, and other relevant factors. The request for 
information must identify the fact that the information is for a 
potential foreign military sale and must identify the foreign customer.
    (b) Working with the departmental/agency activity responsible for 
preparing the DoD Offer and Acceptance to--
    (1) Assist, as necessary, in preparation of the DD Form 1513;
    (2) Identify and explain all unusual contractual requirements or 
requests for deviations; and
    (3) Assist in preparing the price and availability data.
[56 FR 36367, July 31, 1991, as amended at 62 FR 2617, Jan. 17, 1997]



225.7303  Pricing acquisitions for foreign military sales.

    Price FMS contracts using the same principles as are used in pricing 
other defense contracts. Application of the pricing principles in FAR 
parts 15 and 31 to an FMS contract, however, may result in prices that 
differ from other defense contract prices for the same item due to the 
considerations in this section.
[56 FR 36367, July 31, 1991, as amended at 61 FR 50453, Sept. 26, 1996]



225.7303-1  Contractor sales to other foreign customers.

    If the contractor has made sales of the item required for the 
foreign military sale to foreign customers under comparable conditions, 
including quantity and delivery, price the FMS contract in accordance 
with FAR part 15.



225.7303-2  Cost of doing business with a foreign government or an international organization.

    (a) In pricing FMS contracts where non-U.S. Government prices as 
described in 225.7303-1 do not exist, except as provided in 225.7303-5, 
recognize the reasonable and allocable costs of doing business with a 
foreign government or international organization, even though such costs 
might not be recognized in the same amounts in pricing other defense 
contracts. Examples of such costs include, but are not limited to--
    (1) Selling expenses (not otherwise limited by FAR part 31), e.g.--
    (i) Maintaining international sales and service organizations;
    (ii) Sales commissions and fees in accordance with FAR subpart 3.4;
    (iii) Sales promotions, demonstrations, and related travel for sales 
to foreign governments. Paragraph 126.8 of the International Traffic in 
Arms Regulations (ITAR) (22 CFR part 121) may require Government 
approval for these costs to be allowable. If Government approval is 
required for promotion or demonstration costs to be allowable, the 
approval must be obtained.
    (iv) Configuration studies and related technical services undertaken 
as a direct selling effort to a foreign country.
    (2) Product support and post-delivery service expenses, such as--
    (i) Operations or maintenance training, training or tactics films, 
manuals, or other related data; and
    (ii) Technical field services provided in a foreign country related 
to accident investigations, weapon system problems, operations/tactics 
enhancement, and related travel to foreign countries.
    (3) Offset implementation costs.
    (i) A U.S. defense contractor may recover costs incurred to 
implement its offset agreement with a foreign government or 
international organization if the foreign military sale Letter of Offer 
and Acceptance is financed wholly with customer cash or repayable 
foreign military finance credits.
    (ii) The U.S. Government assumes no obligation to satisfy or 
administer the offset requirement or to bear any of the associated 
costs.

[[Page 195]]

    (4) Costs that are the subject of advance agreement under the 
appropriate provisions of FAR part 31; or where the advance 
understanding places a limit on the amounts of cost that will be 
recognized as allowable in defense contract pricing, and the agreement 
contemplated that it will apply only to DoD contracts for the U.S. 
Government's own requirement (as distinguished from contracts for FMS).
    (b) Costs not allowable under FAR part 31 are not allowable in 
pricing foreign military sale contracts, except as noted in paragraph 
(c) of this subsection.
    (c) The provisions of 10 U.S.C. 2372 do not apply to contracts for 
foreign military sales. Therefore, the cost limitations on independent 
research and development and bid and proposal (IR&D/B&P) costs in FAR 
31.205-18 do not apply to such contracts, except as provided in 
225.7303-5. The allowability of IR&D/B&P costs on contracts for foreign 
military sales not wholly paid for from funds made available on a 
nonrepayable basis shall be limited to the contract's allocable share of 
the contractor's total IR&D/B&P expenditures. In pricing contracts for 
such foreign military sales--
    (1) Use the best estimate of reasonable costs in forward pricing.
    (2) Use actual expenditures, to the extent that they are reasonable, 
in determining final cost.
    (d) Under section 21(e)(1)(A) of the Arms Export Control Act, as 
amended, the United States must charge for administrative services to 
recover the estimated cost of administration of sales made under the 
Arms Export Control Act.
[56 FR 36367, July 31, 1991, as amended at 56 FR 67216, Dec. 30, 1991; 
57 FR 42631, Sept. 15, 1992; 57 FR 53600, Nov. 12, 1992; 59 FR 50511, 
Oct. 4, 1994; 61 FR 7744, Feb. 29, 1996; 61 FR 18987, Apr. 30, 1996]



225.7303-3  Government-to-government agreements.

    If a government-to-government agreement between the United States 
and a foreign government for the sale, coproduction, or cooperative 
logistic support of a specifically defined weapon system, major end 
item, or support item, contains language in conflict with the provisions 
of this section, the language of the government-to-government agreement 
prevails.



225.7303-4  Contingent fees.

    (a) Contingent fees are allowable under defense contracts provided 
that the fees are paid to a bona fide employee or a bona fide 
established commercial or selling agency maintained by the prospective 
contractor for the purpose of securing business (see FAR part 31 and FAR 
subpart 3.4). For FMS, it is extremely difficult for DoD to verify the 
services, or the value of the services. Therefore, the cost of allowable 
contingent fees (as defined in FAR subpart 3.4) is limited to $50,000.
    (b) Under DoD 5105.38-M, Security Assistance Management Manual, 
Letters of Offer and Acceptance for requirements for the governments of 
Australia, Taiwan, Egypt, Greece, Israel, Japan, Jordan, Republic of 
Korea, Kuwait, Pakistan, Philippines, Saudi Arabia, Turkey, Thailand, or 
Venezuela (Air Force) must provide that all U.S. Government contracts 
resulting from the Letters of Offer prohibit the payment of contingent 
fees unless the payments have been identified and payment approved in 
writing by the foreign customer before contract award. (See 
225.7308(a).)
[62 FR 2617, Jan. 17, 1997]



225.7303-5  Aquisitions wholly paid for from nonrepayable funds.

    (a) In accordance with 22 U.S.C. 2762(d), foreign military sales 
wholly paid for from funds made available on a nonrepayable basis shall 
be priced on the same costing basis with regard to profit, overhead, 
IR&D/B&P, and other costing elements, as is applicable to acquisitions 
of like items purchased by DoD for its own use.
    (b) Direct costs associated with meeting a foreign customer's 
additional or unique requirements will be allowable under such 
contracts. Indirect burden rates applicable to such direct costs shall 
be permitted at the same rates applicable to acquisitions of like items 
purchased by DoD for its own use.
    (c) A U.S. defense contractor may not recover costs incurred to 
implement its offset agreement with a foreign government or 
international organization if

[[Page 196]]

the foreign military sale Letter of Offer and Acceptance is financed 
with funds made available on a nonrepayable basis.
[61 FR 18988, Apr. 30, 1996; 61 FR 49531, Sept. 20, 1996]



225.7304  Source selection.

    (a) FMS customers may request that a defense article or defense 
service be obtained from a particular contractor. In such cases, FAR 
6.302-4 provides authority to contract without full-and-open 
competition. The FMS customer may also request that a subcontract be 
placed with a particular firm. The contracting officer shall honor such 
requests from the FMS customer only if the Letter of Agreement or other 
written direction sufficiently fulfills the requirements of FAR 6.3.
    (b) Do not allow representatives of the FMS customer to--
    (1) Direct the deletion of names of firms from bidders mailing lists 
or slates of proposed A-E firms. (They may suggest the inclusion of 
certain firms);
    (2) Interfere with a contractor's placement of subcontracts; or
    (3) Participate in the price negotiations between the U.S. 
Government and the contractor.
    (c) Do not accept directions from the FMS customer on source 
selection decisions or contract terms (other than the special contract 
provisions and warranties referred to in Condition A.2 of the DD Form 
1513).
    (d) Do not honor any requests by the FMS customer to reject any bid 
or proposal.



225.7305  Limitation of liability.

    The contracting officer must advise the contractor whenever the 
foreign customer will assume the risk for loss or damage under the 
appropriate limitation of liability clause(s) (see FAR subpart 46.8). 
Consider the costs of necessary insurance, if any, obtained by the 
contractor to cover the risk of loss or damage in establishing the FMS 
contract price.



225.7306  Exercise of options for foreign military sales.

    Consider changes to cost and profit attributable to pricing 
differences between U.S. and FMS requirements when exercising an option 
to satisfy an FMS requirement. Also consider such changes if the option 
is already identified for FMS, but it is exercised for country B 
requirements instead of the country A requirements for which it was 
priced.



225.7307  Offset arrangements.

    In accordance with the Presidential policy statement of April 16, 
1990, DoD does not encourage, enter into, or commit U.S. firms to FMS 
offset arrangements. The decision whether to engage in offsets, and the 
responsibility for negotiating and implementing offset arrangements, 
resides with the companies involved.
[62 FR 34125, June 24, 1997]



225.7308  Contract clauses.

    (a) Use the clause at 252.225-7027, Restriction on Contingent Fees 
for Foreign Military Sales, in all solicitations and contracts for 
foreign military sales.
    (b) Use the clause at 252.225-7028, Exclusionary Policies and 
Practices of Foreign Governments, in all solicitations and contracts for 
the purchase of goods and services for international military education 
training and foreign military sales.
[56 FR 36367, July 31, 1991, as amended at 62 FR 2617, Jan. 17, 1997]



PART 226--OTHER SOCIOECONOMIC PROGRAMS--Table of Contents




                 Subpart 226.1--Indian Incentive Program

Sec.
226.103  Procedures.

    Subpart 226.70--Historically Black Colleges and Universities and 
                          Minority Institutions

226.7000  Scope of subpart.
226.7001  Definitions.
226.7002  General policy.
226.7003  Set-asides for HBCUs and MIs.
226.7003-1  Set-aside criteria.
226.7003-2  Set-aside procedures.
226.7004  Evaluation preference for HBCUs and MIs.
226.7005  Eligibility as an HBCU or MI.
226.7006  Protesting an HBCU or MI representation.
226.7007  Goals and incentives for subcontracting with HBCU/MIs.

[[Page 197]]

226.7008  Solicitation provision and contract clause.

        Subpart 226.71--Preference for Local and Small Businesses

226.7100  Scope of subpart.
226.7101  Definition.
226.7102  Policy.
226.7103  Procedure.
226.7104  Other considerations.

             Subpart 226.72--Base Closures and Realignments

226.7200  Scope.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36388, July 31, 1991, unless otherwise noted.



                Subpart 226.1--Indian Incentive Program.



226.103  Procedures.

    Contracting officers shall contact the Office of Small and 
Disadvantaged Business Utilization, Office of the Under Secretary of 
Defense for Acquisition and Technology, OUSD(A&T) SADBU, Room 2A340, The 
Pentagon, Washington, DC 20301-3061, (703) 697-1688, to obtain funding 
for an approved Indian incentive payment request. Upon receipt of 
funding from OUSD(A&T) SADBU, the contracting officer shall issue a 
unilateral contract modification to add the incentive payment.
[60 FR 61597, Nov. 30, 1995]



    Subpart 226.70--Historically Black Colleges and Universities and 
                          Minority Institutions



Sec. 226.7000  Scope of subpart.

    This subpart implements the historically black college and 
university (HBCU) and minority institution (MI) provisions of 10 U.S.C. 
2323, which--
    (a) Set a goal for DoD for each of fiscal years 1987 through 2000 to 
award five percent of contract and subcontract dollars to small 
disadvantaged business concerns and HBCU/MIs; and
    (b) Require a separate goal, for each of fiscal years 1991 through 
2000, as a subset of the five percent goal, for the participation of 
HBCUs and MIs.
[59 FR 27672, May 27, 1994]



226.7001  Definitions.

    Definitions of HBCUs and MIs are in the clause at 252.226-7000.



226.7002  General policy.

    The DoD will use outreach efforts, technical assistance programs, 
advance payments, HBCU/MI set-asides, and evaluation preferences to meet 
its contract and subcontract goal for use of HBCUs and MIs. In addition, 
DoD will establish ``infrastructure assistance'' (e.g., scholarships, 
faculty development, teaming agreements with defense laboratories, and 
laboratory renovation) at colleges, universities, and institutions that 
agree to bear a substantial portion of the costs associated with the 
progams.
[56 FR 67216, Dec. 30, 1991]



226.7003  Set-asides for HBCUs and MIs.



226.7003-1  Set-aside criteria.

    Set-aside acquisitions for exclusive HBCU and MI participation when 
the acquisition is for research, studies, or services of the type 
normally acquired from higher educational institutions and there is a 
reasonable expectation that--
    (a) Offers will be submitted by at least two responsible HBCUs or 
MIs which can comply with the subcontracting limitations in the clause 
at FAR 52.219-14;
    (b) Award will be made at not more than ten percent above fair 
market price; and
    (c) Scientific and/or technological talent consistent with the 
demands of the acquisition will be offered.



226.7003-2  Set-aside procedures.

    (a) As a general rule, use competitive negotiation for HBCU/MI set-
asides.
    (b) When using a broad agency announcement (FAR 35.016) for basic or 
applied research, make partial set-asides for HBCU/MIs as explained in 
235.016.

[[Page 198]]

    (c) Follow the special synopsis instructions in 205.207(d) (iii), 
(iv), and (v).
    (d) Cancel the set-aside if the low responsible offer exceeds the 
fair market price (defined in FAR part 19) by more than ten percent.



226.7004  Evaluation preference for HBCUs and MIs.

    In acquisitions which use the evaluation preference described in 
subpart 219.70 for small disadvantaged business concerns, the preference 
also applies to offers from HBCUs or MIs.



226.7005  Eligibility as an HBCU or MI.

    (a) To be eligible for award as an HBCU or MI under the preference 
procedures of this subpart, an offeror must--
    (1) Be an HBCU or MI, as defined in the clause at 252.226-7000, 
Notice of Historically Black College or University and Minority 
Institution Set-Aside, at the time of submission of its initial offer 
including price; and
    (2) Provide the contracting officer with evidence of its HBCU or MI 
status upon request.
    (b) The contracting officer shall accept an offeror's HBCU or MI 
status under the provision at 252.226-7001, unless--
    (1) Another offeror challenges the status; or
    (2) The contracting officer has reason to question the offeror's 
HBCU/MI status. (A list of HBCUs is published periodically by the 
Department of Education.)
[56 FR 36388, July 31, 1991, as amended at 59 FR 22131, Apr. 29, 1994; 
62 FR 2613, Jan. 17, 1997]



226.7006  Protesting an HBCU or MI representation.

    Any offeror or other interested party may challenge an offeror's 
HBCU or MI representation by filing a protest with the contracting 
officer. The protest must contain specific detailed evidence supporting 
the basis for the challenge. Such protests are handled in accordance 
with FAR 33.103 and are decided by the contracting officer.



226.7007  Goals and incentives for subcontracting with HBCU/MIs.

    (a) In reviewing subcontracting plans submitted under the clause at 
FAR 52.219-9, Small Business and Small Disadvantaged Business 
Subcontracting Plan, the contracting officer shall--
    (1) Ensure that the contractor included anticipated awards to HBCU/
MIs in the small disadvantaged business goal;
    (2) Consider whether subcontracts are contemplated which involve 
research or studies of the type normally performed by higher educational 
institutions.
    (b) Use of incentives for subcontracting with HBCU/MIs is prescribed 
in 219.708(c)(1).



226.7008  Solicitation provision and contract clause.

    (a) Use the clause at 252.226-7000, Notice of Historically Black 
College or University and Minority Institution Set-Aside, in 
solicitations and contracts set-aside for HBCU/MIs.
    (b) Use the provision at 252.226-7001, Historically Black College or 
University and Minority Institution Status, in solicitations set-aside 
for HBCU/MIs and in solicitations which contain the clause at 252.219-
7006, Notice of Evaluation Preference for Small Disadvantaged Business 
Concerns.
[56 FR 36388, July 31, 1991, as amended at 57 FR 42631, Sept. 15, 1992; 
62 FR 2613, Jan. 17, 1997]



        Subpart 226.71--Preference for Local and Small Businesses

    Source:  59 FR 12192, Mar. 16, 1994, unless otherwise noted.



226.7100  Scope of subpart.

    This subpart implements section 2912 of the Fiscal Year 1994 Defense 
Authorization Act (Pub. L. 103-160) and section 817 of the Fiscal Year 
1995 Defense Authorization Act (Pub. L. 103-337).
[60 FR 5870, Jan. 31, 1995]



226.7101  Definition.

    Vicinity, as used in this subpart, means the county or counties in 
which the military installation to be closed or realigned is located and 
all adjacent

[[Page 199]]

counties, unless otherwise defined by the agency head.
[60 FR 29499, June 5, 1995]



226.7102  Policy.

    Businesses located in the vicinity of a military installation that 
is being closed or realigned under a base closure law, including 10 
U.S.C. 2687, and small and small disadvantaged businesses shall be 
provided maximum practicable opportunity to participate in acquisitions 
that support the closure or realignment, including acquisitions for 
environmental restoration and mitigation.



226.7103  Procedure.

    In considering acquisitions for award through the section 8(a) 
program (subpart 219.8 and FAR subpart 19.8) or in making set-aside 
decisions under subpart 219.5 and FAR subpart 19.5 for acquisitions in 
support of a base closure or realignment, the contracting officer 
shall--
    (a) Determine whether there is a reasonable expectation that offers 
will be received from responsible business concerns located in the 
vicinity of the military installation that is being closed or realigned.
    (b) If offers can not be expected from business concerns in the 
vicinity, proceed with section 8(a) or set-aside consideration as 
otherwise indicated in part 219 and FAR part 19.
    (c) If offers can be expected from business concerns in the 
vicinity--
    (1) Consider section 8(a) only if the 8(a) contractor is located in 
the vicinity.
    (2) Set aside the acquisition for small disadvantaged business only 
if one of the expected offers is from a small disadvantaged business 
located in the vicinity.
    (3) Set aside the acquisition for small business only if one of the 
expected offers is from a small business located in the vicinity.
[60 FR 29499, June 5, 1995]



226.7104  Other considerations.

    When planning for contracts for services related to base closure 
activities at a military installation affected by a closure or 
realignment under a base closure law, contracting officers shall 
consider including, as a factor in source selection, the extent to which 
offerors specifically identify and commit, in their proposals, to a plan 
to hire residents of the vicinity of the military installation that is 
being closed or realigned.
[60 FR 61598, Nov. 30, 1995]



             Subpart 226.72--Base Closures and Realignments



226.7200  Scope.

    This subpart identifies the various policies and statutory 
authorities that affect contracts associated with the closure and 
realignment of military installations. These policies and authorities 
are--
    (a) Right of first refusal of employment. This authority is embodied 
in a clause for use in solicitations and contracts arising from the 
closure of a military installation. The clause establishes employment 
rights for Government employees who are adversely affected by closure of 
the installation (see subpart 222.71).
    (b) Preference for local and small business. This authority allows 
contracting officers, when entering into a contract as part of the 
closure or realignment of a military installation, to give preference, 
to the greatest extent practicable, to qualified businesses located in 
the vicinity of the installation and to small and small disadvantaged 
business concerns (see subpart 226.71).
    (c) Services at installations being closed. This authority allows 
DoD, under certain conditions, to contract with local governments for 
police, fire protection, airfield operations and other community 
services at installations being closed (see subpart 237.74).
[59 FR 36089, July 15, 1994, as amended at 60 FR 29499, June 5, 1995]

[[Page 200]]



             SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS





PART 227--PATENTS, DATA, AND COPYRIGHTS--Table of Contents




Sec.

         Subpart 227.3--Patent Rights Under Government Contracts

227.303  Contract clauses.
227.304  Procedures.
227.304-1  General.
227.304-4  Subcontracts.

              Subpart 227.4--Rights in Data and Copyrights

227.400  Scope of subpart.

   Subpart 227.6--Foreign License and Technical Assistance Agreements

227.670  Scope.
227.671  General.
227.672  Policy.
227.673  Foreign license and technical assistance agreements between the 
          Government and domestic concerns.
227.674  Supply contracts between the Government and a foreign 
          government or concern.
227.675  Foreign license and technical assistance agreements between a 
          domestic concern and a foreign government or concern.
227.675-1  International Traffic in Arms Regulations.
227.675-2  Review of agreements.
227.676  Foreign patent interchange agreements.

     Subpart 227.70--Infringement Claims, Licenses, and Assignments

227.7000  Scope.
227.7001  Policy.
227.7002  Statutes pertaining to administrative claims of infringement.
227.7003  Claims for copyright infringement.
227.7004  Requirements for filing an administrative claim for patent 
          infringement.
227.7005  Indirect notice of patent infringement claims.
227.7006  Investigation and administrative disposition of claims.
227.7007  Notification and disclosure to claimants.
227.7008  Settlement of indemnified claims.
227.7009  Patent releases, license agreements, and assignments.
227.7009-1  Required clauses.
227.7009-2  Clauses to be used when applicable.
227.7009-3  Additional clauses--contracts except running royalty 
          contracts.
227.7009-4  Additional clauses--contracts providing for payment of a 
          running royalty.
227.7010  Assignments.
227.7011  Procurement of rights in inventions, patents, and copyrights.
227.7012  Contract format.
227.7013  Recordation.

                Subpart 227.71--Rights in Technical Data

227.7100  Scope of subpart.
227.7101  Definitions.
227.7102  Commercial items, components, or processes.
227.7102-1  Policy.
227.7102-2  Rights in technical data.
227.7102-3  Contract clause.
227.7103  Noncommercial items or processes.
227.7103-1  Policy.
227.7103-2  Acquisition of technical data.
227.7103-3  Early identification of technical data to be furnished to 
          the Government with restrictions on use, reproduction or 
          disclosure.
227.7103-4  License rights.
227.7103-5  Government rights.
227.7103-6  Contract clauses.
227.7103-7  Use and non-disclosure agreement.
227.7103-8  Deferred delivery and deferred ordering of technical data.
227.7103-9  Copyright.
227.7103-10  Contractor identification and marking of technical data to 
          be furnished with restrictive markings.
227.7103-11  Contractor procedures and records.
227.7103-12  Government right to establish conformity of markings.
227.7103-13  Government right to review, verify, challenge and validate 
          asserted restrictions.
227.7103-14  Conformity, acceptance, and warranty of technical data.
227.7103-15  Subcontractor rights in technical data.
227.7103-16  Providing technical data to foreign governments, foreign 
          contractors, or international organizations.
227.7103-17  Overseas contracts with foreign sources.
227.7104  Contracts under the Small Business Innovative Research (SBIR) 
          Program.
227.7105  Contracts for the acquisition of existing works.
227.7105-1  General.
227.7105-2  Acquisition of existing works without modification.
227.7105-3  Acquisition of modified existing works.

[[Page 201]]

227.7106  Contracts for special works.
227.7107  Contracts for architect-engineer services.
227.7107-1  Architectural designs and data clauses for architect-
          engineer or construction contracts.
227.7107-2  Contracts for construction supplies and research and 
          development work.
227.7107-3  Approval of restricted designs.
227.7108  Contractor data repositories.

   Subpart 227.72--Rights in Computer Software and Computer Software 
                              Documentation

227.7200  Scope of subpart.
227.7201  Definitions.
227.7202  Commercial computer software and commercial computer software 
          documentation.
227.7202-1  Policy.
227.7202-2  [Reserved]
227.7202-3  Rights in commercial computer software or commercial 
          computer software documentation.
227.7202-4  Contract clause.
227.7203  Noncommercial computer software and noncommercial computer 
          software documentation.
227.7203-1  Policy.
227.7203-2  Acquisition of noncommercial computer software and computer 
          software documentation.
227.7203-3  Early identification of computer software or computer 
          software documentation to be furnished to the Government with 
          restrictions on use, reproduction or disclosure.
227.7203-4  License rights.
227.7203-5  Government rights.
227.7203-6  Contract clauses.
227.7203-7  Reserved.
227.7203-8  Deferred delivery and deferred ordering or computer software 
          and computer software documentation.
227.7203-9  Copyright.
227.7203-10  Contractor identification and marking of computer software 
          or computer software documentation to be furnished with 
          restrictive markings.
227.7203-11  Contractor procedures and records.
227.7203-12  Government right to establish conformity of markings.
227.7203-13  Government right to review, verify, challenge and validate 
          asserted restrictions.
227.7203-14  Conformity, acceptance, and warranty of computer software 
          and computer software documentation.
227.7203-15  Subcontractor rights in computer software or computer 
          software documentation.
227.7203-16  Providing computer software or computer software 
          documentation to foreign governments, foreign contractors, or 
          international organizations.
227.7203-17  Overseas contracts with foreign sources.
227.7204  Contracts under the Small Business Innovative Research 
          Program.
227.7205  Contracts for special works.
227.7206  Contracts for architect-engineer services.
227.7207  Contractor data repositories.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36389, July 31, 1991, unless otherwise noted.



         Subpart 227.3--Patent Rights Under Government Contracts



227.303  Contract clauses.

    (a) Pursuant to FAR 27.304-1(e), the contracting officer shall 
insert the clause at 252.227-7039, Patents--Reporting of Subject 
Inventions, in solicitations and contracts containing the clause at FAR 
52.227-11, Patent Rights--Retention by the Contractor (Short Form).



227.304  Procedures.



227.304-1  General.

    Interim and final invention reports and notification of all 
subcontracts for experimental, developmental, or research work (FAR 
27.304-1(e)(2)(ii)) may be submitted on DD Form 882, Report of 
Inventions and Subcontracts.
[56 FR 36389, July 31, 1991, as amended at 57 FR 53600, Nov. 12, 1992]



227.304-4  Subcontracts.

    The contracting officer shall insert the clause at 252.227-7034, 
Patents-Subcontracts, in solicitations and contracts containing the 
clause at FAR 52.227-11, Patent Rights--Retention by the Contractor 
(Short Form).



              Subpart 227.4--Rights in Data and Copyrights



227.400  Scope of subpart.

    DoD activities shall use the guidance in subparts 227.71 and 227.72 
instead of the guidance in FAR subpart 27.4.
[60 FR 33471, June 28, 1995]

[[Page 202]]



   Subpart 227.6--Foreign License and Technical Assistance Agreements



227.670  Scope.

    This subpart prescribes policy with respect to foreign license and 
technical assistance agreements.



227.671  General.

    In furtherance of the Military Assistance Program or for other 
national defense purposes, the Government may undertake to develop or 
encourage the development of foreign additional sources of supply. The 
development of such sources may be accomplished by an agreement, often 
called a foreign licensing agreement or technical assistance agreement, 
wherein a domestic concern, referred to in this subpart as a ``primary 
source,'' agrees to furnish to a foreign concern or government, herein 
referred to as a ``second source;'' foreign patent rights; technical 
assistance in the form of data, know-how, trained personnel of the 
primary source, instruction and guidance of the personnel of the second 
source, jigs, dies, fixtures, or other manufacturing aids, or such other 
assistance, information, rights, or licenses as are needed to enable the 
second source to produce particular supplies or perform particular 
services. Agreements calling for one or more of the foregoing may be 
entered into between the primary source and the Government, a foreign 
government, or a foreign concern. The consideration for providing such 
foreign license and technical assistance may be in the form of a lump 
sum payment, payments for each item manufactured by the second source, 
an agreement to exchange data and patent rights on improvements made to 
the article or service, capital stock transactions, or any combination 
of these. The primary source's bases for computing such consideration 
may include actual costs; charges for the use of patents, data, or know-
how reflecting the primary source's investment in developing and 
engineering and production techniques; and the primary source's 
``price'' for setting up a second source. Such agreements often refer to 
the compensation to be paid as a royalty or license fee whether or not 
patent rights are involved.



227.672  Policy.

    It is Government policy not to pay in connection with its contracts, 
and not to allow to be paid in connection with contracts made with funds 
derived through the Military Assistance Program or otherwise through the 
United States Government, charges for use of patents in which it holds a 
royalty-free license or charges for data which it has a right to use and 
disclose to others, or which is in the public domain, or which the 
Government has acquired without restriction upon its use and disclosure 
to others. This policy shall be applied by the Departments in 
negotiating contract prices for foreign license technical assistance 
contracts (227.675) or supply contracts with second sources (227.674); 
and in commenting on such agreements when they are referred to the 
Department of Defense by the Department of State pursuant to section 414 
of the Mutual Security Act of 1954 as amended (22 U.S.C. 1934) and the 
International Traffic in Arms Regulations (see 227.675).



227.673  Foreign license and technical assistance agreements between the Government and domestic concerns.

    (a) Contracts between the Government and a primary source to provide 
technical assistance or patent rights to a second source for the 
manufacture of supplies or performance of services shall, to the extent 
practicable, specify the rights in patents and data and any other rights 
to be supplied to the second source. Each contract shall provide, in 
connection with any separate agreement between the primary source and 
the second source for patent rights or technical assistance relating to 
the articles or services involved in the contract, that--
    (1) The primary source and his subcontractors shall not make, on 
account of any purchases by the Government or by others with funds 
derived through the Military Assistance Program or otherwise through the 
Government, any charge to the second source for royalties or 
amortization for patents or inventions in which the Government

[[Page 203]]

holds a royalty-free license; or data which the Government has the right 
to possess, use, and disclose to others; or any technical assistance 
provided to the second source for which the Government has paid under a 
contract between the Government and the primary source; and
    (2) The separate agreement between the primary and second source 
shall include a statement referring to the contract between the 
Government and the primary source, and shall conform to the requirements 
of the International Traffic in Arms Regulations (see 227.675-1).
    (b) The following factors, among others, shall be considered in 
negotiating the price to be paid the primary source under contracts 
within (a) of this section:
    (1) The actual cost of providing data, personnel, manufacturing 
aids, samples, spare parts, and the like;
    (2) The extent to which the Government has contributed to the 
development of the supplies or services, and to the methods of 
manufacture or performance, through past contracts for research and 
development or for manufacture of the supplies or performance of the 
services; and
    (3) The Government's patent rights and rights in data relating to 
the supplies or services and to the methods of manufacture or of 
performance.



227.674  Supply contracts between the Government and a foreign government or concern.

    In negotiating contract prices with a second source, including the 
redetermination of contract prices, or in determining the allowability 
of costs under a cost-reimbursement contract with a second source, the 
contracting officer:
    (a) Shall obtain from the second source a detailed statement (see 
FAR 27.204-1(a)(2)) of royalties, license fees, and other compensation 
paid or to be paid to a primary source (or any of his subcontractors) 
for patent rights, rights in data, and other technical assistance 
provided to the second source, including identification and description 
of such patents, data, and technical assistance; and
    (b) Shall not accept or allow charges which in effect are--
    (1) For royalties or amortization for patents or inventions in which 
the Government holds a royalty-free license; or
    (2) For data which the Government has a right to possess, use, and 
disclose to others; or
    (3) For any technical assistance provided to the second source for 
which the Government has paid under a contract between the Government 
and a primary source.



227.675  Foreign license and technical assistance agreements between a domestic concern and a foreign government or concern.



227.675-1  International Traffic in Arms Regulations.

    Pursuant to section 414 of the Mutual Security Act of 1954, as 
amended (22 U.S.C. 1934), the Department of State controls the 
exportation of data relating to articles designated in the United States 
Munitions List as arms, ammunition, or munitions of war. (The Munitions 
List and pertinent procedures are set forth in the International Traffic 
in Arms Regulations, 22 CFR, et seq.) Before authorizing such 
exportation, the Department of State generally requests comments from 
the Department of Defense. On request of the Office of the Assistant 
Secretary of Defense (International Security Affairs), each Department 
shall submit comments thereon as the basis for a Department of Defense 
reply to the Department of State.



227.675-2  Review of agreements.

    (a) In reviewing foreign license and technical assistance agreements 
between primary and second sources, the Department concerned shall, 
insofar as its interests are involved, indicate whether the agreement 
meets the requirements of Secs. 124.07-124.10 of the International 
Traffic in Arms Regulations or in what respects it is deficient. 
Paragraphs (b) through (g) of this subsection provide general guidance.
    (b) When it is reasonably anticipated that the Government will 
purchase from the second source the supplies or services involved in the 
agreement, or that Military Assistance Program

[[Page 204]]

funds will be provided for the procurement of the supplies or services, 
the following guidance applies.
    (1) If the agreement specifies a reduction in charges thereunder, 
with respect to purchases by or for the Government or by others with 
funds derived through the Military Assistance Program or otherwise 
through the Government, in recognition of the Government's rights in 
patents and data, the Department concerned shall evaluate the amount of 
the reduction to determine whether it is fair and reasonable in the 
circumstances, before indicating its approval.
    (2) If the agreement does not specify any reduction in charges or 
otherwise fails to give recognition to the Government's rights in the 
patents or data involved, approval shall be conditioned upon amendment 
of the agreement to reflect a reduction, evaluated by the Department 
concerned as acceptable to the Government, in any charge thereunder with 
respect to purchases made by or for the Government or by others with 
funds derived through the Military Assistance Program or otherwise 
through the Government, in accordance with Sec. 124.10 of the 
International Traffic in Arms Regulations.
    (3) If the agreement provides that no charge is to be made to the 
second source for data or patent rights to the extent of the 
Government's rights, the Department concerned shall evaluate the 
acceptability of the provision before indicating its approval.
    (4) If time or circumstances do not permit the evaluation called for 
in (b) (1), (2), or (3) of this subsection, the guidance in (c) of this 
subsection shall be followed.
    (c) When it is not reasonably anticipated that the Government will 
purchase from the second source the supplies or services involved in the 
agreement nor that Military Assistance Program funds will be provided 
for the purchase of the supplies or services, then the following 
guidance applies.
    (1) If the agreement provides for charges to the second source for 
data or patent rights, it may suffice to fulfill the requirements of 
Sec. 124.10 insofar as the Department of Defense is concerned if:
    (i) The agreement requires the second source to advise the primary 
source when he has knowledge of any purchase made or to be made from him 
by or for the Government or by others with funds derived through the 
Military Assistance Program or otherwise through the Government;
    (ii) The primary source separately agrees with the Government that 
upon such advice to him from the second source or from the Government or 
otherwise as to any such a purchase or prospective purchase, he will 
negotiate with the Department concerned an appropriate reduction in his 
charges to the second source in recognition of any Government rights in 
patents or data; and
    (iii) The agreement between the primary and second sources further 
provides that in the event of any such purchase and resulting reduction 
in charges, the second source shall pass on this reduction to the 
Government by giving the Government a corresponding reduction in the 
purchase price of the article or service.
    (2) If the agreement provides that no charge is to be made to the 
second source for data or patent rights to the extent to which the 
Government has rights, the Department concerned shall:
    (i) Evaluate the acceptability of the provision before indicating 
its approval; or
    (ii) Explicitly condition its approval on the right to evaluate the 
acceptability of the provision at a later time.
    (d) When there is a technical assistance agreement between the 
primary source and the Government related to the agreement between the 
primary and second sources that is under review, the latter agreement 
shall reflect the arrangements contemplated with respect thereto by the 
Government's technical assistance agreement with the primary source.
    (e) Every agreement shall provide that any license rights 
transferred under the agreement are subject to existing rights of the 
Government.
    (f) In connection with every agreement referred to in (b) of this 
section, a request shall be made to the primary source--

[[Page 205]]

    (1) To identify the patents, data, and other technical assistance to 
be provided to the second source by the primary source or any of his 
subcontractors,
    (2) To identify any such patents and data in which, to the knowledge 
of the primary source, the Government may have rights, and
    (3) To segregate the charges made to the second source for each such 
category or item of patents, data, and other technical assistance.

Reviewing personnel shall verify this information or, where the primary 
source does not furnish it, obtain such information from Governmental 
sources so far as practicable.
    (g) The Department concerned shall make it clear that its approval 
of any agreement does not necessarily recognize the propriety of the 
charges or the amounts thereof, or constitute approval of any of the 
business arrangements in the agreement, unless the Department expressly 
intends by its approval to commit itself to the fairness and 
reasonableness of a particular charge or charges. In any event, a 
disclaimer should be made to charges or business terms not affecting any 
purchase made by or for the Government or by others with funds derived 
through the Military Assistance Program or otherwise through the 
Government.



227.676  Foreign patent interchange agreements.

    (a) Patent interchange agreements between the United States and 
foreign governments provide for the use of patent rights, compensation, 
free licenses, and the establishment of committees to review and make 
recommendations on these matters. The agreements also may exempt the 
United States from royalty and other payments. The contracting officer 
shall ensure that royalty payments are consistent with patent 
interchange agreements.
    (b) Assistance with patent rights and royalty payments in the United 
States European Command (USEUCOM) area of responsibility is available 
from HQ USEUCOM, ATTN: ECLA, Unit 30400, Box 1000, APO AE 09128; 
Telephone: DSN 430-7474, Commercial 49-0711-680-7474; Telefax: 49-0711-
680-7408.
[62 FR 34125, June 24, 1997]



     Subpart 227.70--Infringement Claims, Licenses, and Assignments



227.7000  Scope.

    This subpart prescribes policy, procedures, and instructions for use 
of clauses with respect to processing licenses, assignments, and 
infringement claims.



227.7001  Policy.

    Whenever a claim of infringement of privately owned rights in 
patented inventions or copyrighted works is asserted against any 
Department or Agency of the Department of Defense, all necessary steps 
shall be taken to investigate, and to settle administratively, deny, or 
otherwise dispose of such claim prior to suit against the United States. 
This subpart 227.70 does not apply to licenses or assignments acquired 
by the Department of Defense under the Patent Rights clauses.



227.7002  Statutes pertaining to administrative claims of infringement.

    Statutes pertaining to administrative claims of infringement in the 
Department of Defense include the following: the Foreign Assistance Act 
of 1961, 22 U.S.C. 2356 (formerly the Mutual Security Acts of 1951 and 
1954); the Invention Secrecy Act, 35 U.S.C. 181-188; 10 U.S.C. 2386; 28 
U.S.C. 1498; and 35 U.S.C. 286.



227.7003  Claims for copyright infringement.

    The procedures set forth herein will be followed, where applicable, 
in copyright infringement claims.



227.7004  Requirements for filing an administrative claim for patent infringement.

    (a) A patent infringement claim for compensation, asserted against 
the United States under any of the applicable statutes cited in 
227.7002, must be actually communicated to and received by a Department, 
agency, organization, office, or field establishment within

[[Page 206]]

the Department of Defense. Claims must be in writing and should include 
the following:
    (1) An allegation of infringement;
    (2) A request for compensation, either expressed or implied;
    (3) A citation of the patent or patents alleged to be infringed;
    (4) A sufficient designation of the alleged infringing item or 
process to permit identification, giving the military or commercial 
designation, if known, to the claimant;
    (5) A designation of at least one claim of each patent alleged to be 
infringed; or
    (6) As an alternative to (a) (4) and (5) of this section, a 
declaration that the claimant has made a bona fide attempt to determine 
the item or process which is alleged to infringe, but was unable to do 
so, giving reasons, and stating a reasonable basis for his belief that 
his patent or patents are being infringed.
    (b) In addition to the information listed in (a) of this section, 
the following material and information is generally necessary in the 
course of processing a claim of patent infringement. Claimants are 
encouraged to furnish this information at the time of filing a claim to 
permit the most expeditious processing and settlement of the claim.
    (1) A copy of the asserted patent(s) and identification of all 
claims of the patent alleged to be infringed.
    (2) Identification of all procurements known to claimant which 
involve the alleged infringing item or process, including the identity 
of the vendor or contractor and the Government procuring activity.
    (3) A detailed identification of the accused article or process, 
particularly where the article or process relates to a component or 
subcomponent of the item procured, an element by element comparison of 
the representative claims with the accused article or process. If 
available, this identification should include documentation and drawings 
to illustrate the accused article or process in suitable detail to 
enable verification of the infringement comparison.
    (4) Names and addresses of all past and present licenses under the 
patent(s), and copies of all license agreements and releases involving 
the patent(s).
    (5) A brief description of all litigation in which the patent(s) has 
been or is now involved, and the present status thereof.
    (6) A list of all persons to whom notices of infringement have been 
sent, including all departments and agencies of the Government, and a 
statement of the ultimate disposition of each.
    (7) A description of Government employment or military service, if 
any, by the inventor and/or patent owner.
    (8) A list of all Government contracts under which the inventor, 
patent owner, or anyone in privity with him performed work relating to 
the patented subject matter.
    (9) Evidence of title to the patent(s) alleged to be infringed or 
other right to make the claim.
    (10) A copy of the Patent Office file of each patent if available to 
claimant.
    (11) Pertinent prior art known to claimant, not contained in the 
Patent Office file, particularly publications and foreign art.

In addition in the foregoing, if claimant can provide a statement that 
the investigation may be limited to the specifically identified accused 
articles or processes, or to a specific procurement, it may materially 
expedite determination of the claim.
    (c) Any Department receiving an allegation of patent infringement 
which meets the requirements of this paragraph shall acknowledge the 
same and supply the other Departments which may have an interest therein 
with a copy of such communication and the acknowledgement thereof.
    (1) For the Department of the Army--Chief, Patents, Copyrights, and 
Trademarks Division, U.S. Army Legal Services Agency;
    (2) For the Department of the Navy--The Patent Counsel for Navy, 
Office of Naval Research;
    (3) For the Department of the Air Force--Chief, Patents Division, 
Office of The Judge Advocate General;
    (4) For the Defense Logistics Agency--The Office of Counsel; for the 
National Security Agency, the General Counsel;
    (5) For the Defense Information Systems Agency--the Counsel;

[[Page 207]]

    (6) For the Defense Special Weapons Agency--The General Counsel; and
    (7) For the Defense Mapping Agency--The Counsel.
    (d) If a communication alleging patent infringement is received 
which does not meet the requirements set forth in paragraph (c) of this 
section, the sender shall be advised in writing--
    (1) That his claim for infringement has not been satisfactorily 
presented, and
    (2) Of the elements considered necessary to establish a claim.
    (e) A communication making a proffer of a license in which no 
infringement is alleged shall not be considered as a claim for 
infringement.
[56 FR 36389, July 31, 1991, as amended at 56 FR 67216, Dec. 30, 1991; 
61 FR 50454, Sept. 26, 1996; 62 FR 2613, Jan. 17, 1997]



227.7005  Indirect notice of patent infringement claims.

    (a) A communication by a patent owner to a Department of Defense 
contractor alleging that the contractor has committed acts of 
infringement in performance of a Government contract shall not be 
considered a claim within the meaning of 227.7004 until it meets the 
requirements specified therein.
    (b) Any Department receiving an allegation of patent infringement 
which meets the requirements of 227.7004 shall acknowledge the same and 
supply the other Departments (see 227.7004(c)) which may have an 
interest therein with a copy of such communication and the 
acknowledgement thereof.
    (c) If a communication covering an infringement claim or notice 
which does not meet the requirements of 227.7004(a) is received from a 
contractor, the patent owner shall be advised in writing as covered by 
the instructions of 227.7004(d).



227.7006  Investigation and administrative disposition of claims.

    An investigation and administrative determination (denial or 
settlement) of each claim shall be made in accordance with instructions 
and procedures established by each Department, subject to the following:
    (a) When the procurement responsibility for the alleged infringing 
item or process is assigned to a single Department or only one 
Department is the purchaser of the alleged infringing item or process, 
and the funds of that Department only are to be charged in the 
settlement of the claim, that Department shall have the sole 
responsibility for the investigation and administrative determination of 
the claim and for the execution of any agreement in settlement of the 
claim. Where, however, funds of another Department are to be charged, in 
whole or in part, the approval of such Department shall be obtained as 
required by 208.7002. Any agreement in settlement of the claim, approved 
pursuant to 208.7002 shall be executed by each of the Departments 
concerned.
    (b) When two or more Departments are the respective purchasers of 
alleged infringing items or processes and the funds of those Departments 
are to be charged in the settlement of the claim, the investigation and 
administrative determination shall be the responsibility of the 
Department having the predominant financial interest in the claim or of 
the Department or Departments as jointly agreed upon by the Departments 
concerned. The Department responsible for negotiation shall, throughout 
the negotiation, coordinate with the other Departments concerned and 
keep them advised of the status of the negotiation. Any agreement in the 
settlement of the claim shall be executed by each Department concerned.



227.7007  Notification and disclosure to claimants.

    When a claim is denied, the Department responsible for the 
administrative determination of the claim shall so notify the claimant 
or his authorized representative and provide the claimant a reasonable 
rationale of the basis for denying the claim. Disclosure of information 
or the rationale referred to above shall be subject to applicable 
statutes, regulations, and directives pertaining to security, access to 
official records, and the rights of others.



227.7008  Settlement of indemnified claims.

    Settlement of claims involving payment for past infringement shall 
not be

[[Page 208]]

made without the consent of, and equitable contribution by, each 
indemnifying contractor involved, unless such settlement is determined 
to be in the best interests of the Government and is coordinated with 
the Department of Justice with a view to preserving any rights of the 
Government against the contractors involved. If consent of and equitable 
contribution by the contractors are obtained, the settlement need not be 
coordinated with the Department of Justice.



227.7009  Patent releases, license agreements, and assignments.

    This section contains clauses for use in patent release and 
settlement agreements, license agreements, and assignments, executed by 
the Government, under which the Government acquires rights. Minor 
modifications of language (e.g., pluralization of ``Secretary'' or 
``Contracting Officer'') in multi-departmental agreements may be made if 
necessary.



227.7009-1  Required clauses.

    (a) Covenant Against Contingent Fees. Insert the clause at FAR 
52.203-5.
    (b) Gratuities. Insert the clause at FAR 52.203-3.
    (c) Assignment of Claims. Insert the clause at FAR 52.232-23.
    (d) Disputes. Pursuant to FAR 33.014, insert the clause at FAR 
52.233-1.
    (e) Non-Estoppel. Insert the clause at 252.227-7000.
[56 FR 36389, July 31, 1991, as amended at 61 FR 50454, Sept. 26, 1996]



227.7009-2  Clauses to be used when applicable.

    (a) Release of past infringement. The clause at 252.227-7001, 
Release of Past Infringement, is an example which may be modified or 
omitted as appropriate for particular circumstances, but only upon the 
advice of cognizant patent or legal counsel. (See footnotes at end of 
clause.)
    (b) Readjustment of payments. The clause at 252.227-7002, 
Readjustment of Payments, shall be inserted in contracts providing for 
payment of a running royalty.
    (c) Termination. The clause at 252.227-7003, Termination, is an 
example for use in contracts providing for the payment of a running 
royalty. This clause may be modified or omitted as appropriate for 
particular circumstances, but only upon the advice of cognizant patent 
or legal counsel (see 227.7004(c)).



227.7009-3  Additional clauses--contracts except running royalty contracts.

    The following clauses are examples for use in patent release and 
settlement agreements, and license agreements not providing for payment 
by the Government of a running royalty.
    (a) License Grant. Insert the clause at 252.227-7004.
    (b) License Term. Insert one of the clauses at 252.227-7005 
Alternate I or Alternate II, as appropriate.



227.7009-4  Additional clauses--contracts providing for payment of a running royalty.

    The clauses set forth below are examples which may be used in patent 
release and settlement agreements, and license agreements, when it is 
desired to cover the subject matter thereof and the contract provides 
for payment of a running royalty.
    (a) License grant--running royalty. No Department shall be obligated 
to pay royalties unless the contract is signed on behalf of such 
Department. Accordingly, the License Grant clause at 252.227-7006 should 
be limited to the practice of the invention by or for the signatory 
Department or Departments.
    (b) License term--running royalty. The clause at 252.227-7007 is a 
sample form for expressing the license term.
    (c) Computation of royalties. The clause at 252.227-7008 providing 
for the computation of royalties, may be of varying scope depending upon 
the nature of the royalty bearing article, the volume of procurement, 
and the type of contract pursuant to which the procurement is to be 
accomplished.
    (d) Reporting and payment of royalties. (1) The contract should 
contain a provision specifying the office designated within the specific 
Department involved to make any necessary reports to the contractor of 
the extent of use of the licensed subject matter by the entire 
Department, and such office shall be charged with the responsibility of 
obtaining from all procuring offices

[[Page 209]]

of that Department the information necessary to make the required 
reports and corresponding vouchers necessary to make the required 
payments. The clause at 252.227-7009 is a sample for expressing 
reporting and payment of royalties requirements.
    (2) Where more than one Department or Government Agency is licensed 
and there is a ceiling on the royalties payable in any reporting period, 
the licensing Departments or Agencies shall coordinate with respect to 
the pro rata share of royalties to be paid by each.
    (e) License to other government agencies. When it is intended that a 
license on the same terms and conditions be available to other 
departments and agencies of the Government, the clause at 252.227-7010 
is an example which may be used.



227.7010  Assignments.

    (a) The clause at 252.227-7011 is an example which may be used in 
contracts of assignment of patent rights to the Government.
    (b) To facilitate proof of contracts of assignments, the 
acknowledgement of the contractor should be executed before a notary 
public or other officer authorized to administer oaths (35 U.S.C. 261).



227.7011  Procurement of rights in inventions, patents, and copyrights.

    Even though no infringement has occurred or been alleged, it is the 
policy of the Department of Defense to procure rights under patents, 
patent applications, and copyrights whenever it is in the Government's 
interest to do so and the desired rights can be obtained at a fair 
price. The required and suggested clauses at 252.227-7004 and 252.227-
7010 shall be required and suggested clauses, respectively, for license 
agreements and assignments made under this paragraph. The instructions 
at 227.7009-3 and 227.7010 concerning the applicability and use of those 
clauses shall be followed insofar as they are pertinent.



227.7012  Contract format.

    The format at 252.227-7012 appropriately modified where necessary, 
may be used for contracts of release, license, or assignment.



227.7013  Recordation.

    Executive Order No. 9424 of 18 February 1944 requires all executive 
Departments and agencies of the Government to forward through 
appropriate channels to the Commissioner of Patents and Trademarks, for 
recording, all Government interests in patents or applications for 
patents.



                Subpart 227.71--Rights in Technical Data

    Source:  60 FR 33471, June 28, 1995, unless otherwise noted.



227.7100  Scope of subpart.

    This subpart--
    (a) Prescribes policies and procedures for the acquisition of 
technical data and the rights to use, modify, reproduce, release, 
perform, display, or disclose technical data. It implements requirements 
in the following laws and Executive Order:
    (1) 10 U.S.C. 2302(4).
    (2) 10 U.S.C. 2305 (subsection (d)(4)).
    (3) 10 U.S.C. 2320.
    (4) 10 U.S.C. 2321.
    (5) 10 U.S.C. 2325.
    (6) Pub. L. 103-355.
    (7) Executive Order 12591 (Subsection 1(b)(6)).
    (b) Does not apply to computer software or technical data that is 
computer software documentation (see subpart 227.72).



227.7101  Definitions.

    (a) As used in this subpart, unless otherwise specifically 
indicated, the terms ``offeror'' and ``contractor'' include an offeror's 
or contractor's subcontractors, suppliers, or potential subcontractors 
or suppliers at any tier.
    (b) Other terms used in this subpart are defined in the clause at 
252.227-7013, Rights in Technical Data--Noncommercial Items.
[56 FR 36389, July 31, 1991, as amended at 60 FR 61598, Nov. 30, 1995]



227.7102  Commercial items, components, or processes.

    Section 2320(b)(1) of Title 10 U.S.C. establishes a presumption that 
commercial items are developed at private expense whether or not a 
contractor

[[Page 210]]

submits a justification in response to a challenge notice. Therefore, do 
not challenge a contractor's assertion that a commercial item, 
component, or process was developed at private expense unless the 
Government can demonstrate that it contributed to development of the 
item, component or process. Follow the procedures in 227.7103-13 and the 
clause at 252.227-7037, Validation of Restrictive Markings on Technical 
Data, when information provided by the Department of Defense 
demonstrates that an item, component, or process was not developed 
exclusively at private expense. However, when a challenge is warranted, 
a contractor's or subcontractor's failure to respond to the challenge 
notice cannot be the sole basis for issuing a final decision denying the 
validity of an asserted restriction.



227.7102-1  Policy.

    (a) DoD shall acquire only the technical data customarily provided 
to the public with a commercial item or process, except technical data 
that--
    (1) Are form, fit, or function data;
    (2) Are required for repair or maintenance of commercial items or 
processes, or for the proper installation, operating, or handling of a 
commercial item, either as a stand alone unit or as a part of a military 
system, when such data are not customarily provided to commercial users 
or the data provided to commercial users is not sufficient for military 
purposes; or
    (3) Describe the modifications made at Government expense to a 
commercial item or process in order to meet the requirements of a 
Government solicitation.
    (b) To encourage offerors and contractors to offer or use commercial 
products to satisfy military requirements, offerors, and contractors 
shall not be required, except for the technical data described in 
paragraph (a) of this subsection, to--
    (1) Furnish technical information related to commercial items or 
processes that is not customarily provided to the public; or
    (2) Relinquish to, or otherwise provide, the Government rights to 
use, modify, reproduce, release, perform, display, or disclose technical 
data pertaining to commercial items or processes except for a transfer 
of rights mutually agreed upon.



227.7102-2  Rights in technical data.

    (a) The clause at 252.227-7015, Technical Data--Commercial Items, 
provides the Government specific license rights in technical data 
pertaining to commercial items or processes. DoD may use, modify, 
reproduce, release, perform, display, or disclose data only within the 
Government. The data may not be used to manufacture additional 
quantities of the commercial items and, except for emergency repair or 
overhaul, may not be released or disclosed to, or used by, third parties 
without the contractor's written permission. Those restrictions do not 
apply to the technical data described in 227.7102-1(a).
    (b) If additional rights are needed, contracting activities must 
negotiate with the contractor to determine if there are acceptable terms 
for transferring such rights. The specific additional rights granted to 
the Government shall be enumerated in a license agreement made part of 
the contract.



227.7102-3  Contract clause.

    (a) Except as provided in paragraph (b) of this subsection, use the 
clause at 252.227-7015, Technical Data--Commercial Items, in all 
solicitations and contracts when the contractor will be required to 
deliver technical data pertaining to commercial items, components, or 
processes. Do not require the contractor to include this clause in its 
subcontracts.
    (b) Use the clause at 252.227-7013, Rights in Technical Data--
Noncommercial Items, in lieu of the clause at 252.227-7015 if the 
Government will pay any portion of the development costs. Do not require 
the contractor to include this clause in its subcontracts for commercial 
items or commercial components.
    (c) Use the clause at 252.227-7037, Validation of Restrictive 
Markings on Technical Data, in all solicitations and contracts for 
commercial items that include the clause at 252.227-7015 or the clause 
at 252.227-7013. Do not require the contractor to include this clause in

[[Page 211]]

its subcontracts for commercial items or commercial components.
[56 FR 36389, July 31, 1991, as amended at 60 FR 61598, Nov. 30, 1995]



227.7103  Noncommercial items or processes.



227.7103-1  Policy.

    (a) DoD policy is to acquire only the technical data, and the rights 
in that data, necessary to satisfy agency needs.
    (b) Solicitations and contracts shall--
    (1) Specify the technical data to be delivered under a contract and 
delivery schedules for the data;
    (2) Establish or reference procedures for determining the 
acceptability of technical data;
    (3) Establish separate contract line items, to the extent 
practicable, for the technical data to be delivered under a contract and 
require offerors and contractors to price separately each deliverable 
data item; and
    (4) Require offerors to identify, to the extent practicable, 
technical data to be furnished with restrictions on the Government's 
rights and require contractors to identify technical data to be 
delivered with such restrictions prior to delivery.
    (c) Offerors shall not be required, either as a condition of being 
responsive to a solicitation or as a condition for award, to sell or 
otherwise relinquish to the Government any rights in technical data 
related to items, components or processes developed at private expense 
except for the data identified at 227.7103-5(a)(2) and (a)(4) through 
(9).
    (d) Offerors and contractors shall not be prohibited or discouraged 
from furnishing or offering to furnish items, components, or processes 
developed at private expense solely because the Government's rights to 
use, modify, release, reproduce, perform, display, or disclose technical 
data pertaining to those items may be restricted.
    (e) As provided in 10 U.S.C. 2305, solicitations for major systems 
development contracts shall not require offerors to submit proposals 
that would permit the Government to acquire competitively items 
identical to items developed at private expense unless a determination 
is made at a level above the contracting officer that--
    (1) The offeror will not be able to satisfy program schedule or 
delivery requirements; or
    (2) The offeror's proposal to meet mobilization requirements does 
not satisfy mobilization needs.



227.7103-2  Acquisition of technical data.

    (a) Contracting officers shall work closely with data managers and 
requirements personnel to assure that data requirements included in 
solicitations are consistent with the policy expressed in 227.7103-1.
    (b)(1) Data managers or other requirements personnel are responsible 
for identifying the Government's minimum needs for technical data. Data 
needs must be established giving consideration to the contractor's 
economic interests in data pertaining to items, components, or processes 
that have been developed at private expense; the Government's costs to 
acquire, maintain, store, retrieve, and protect the data; reprocurement 
needs; repair, maintenance and overhaul philosophies; spare and repair 
part considerations; and whether procurement of the items, components, 
or processes can be accomplished on a form, fit, or function basis. When 
it is anticipated that the Government will obtain unlimited or 
government purpose rights in technical data that will be required for 
competitive spare or repair parts procurements, such data should be 
identified as deliverable data items. Reprocurement needs may not be a 
sufficient reason to acquire detailed manufacturing or process data when 
items or components can be acquired using performance specifications, 
form, fit and function data, or when there are a sufficient number of 
alternate sources which can reasonably be expected to provide such items 
on a performance specification or form, fit, or function basis.
    (2) When reviewing offers received in response to a solicitation or 
other request for data, data managers must balance the original 
assessment of the Government's data needs with data prices contained in 
the offer.

[[Page 212]]

    (c) Contracting officers are responsible for ensuring that, wherever 
practicable, solicitations and contracts--
    (1) Identify the type and quantity of the technical data to be 
delivered under the contract and the format and media in which the data 
will be delivered;
    (2) Establish each deliverable data item as a separate contract line 
item (this requirement may be satisfied by listing each deliverable data 
item on an exhibit to the contract);
    (3) Identify the prices established for each deliverable data item 
under a fixed-price type contract;
    (4) Include delivery schedules and acceptance criteria for each 
deliverable data item; and
    (5) Specifically identify the place of delivery for each deliverable 
item of technical data.



227.7103-3  Early identification of technical data to be furnished to the Government with restrictions on use, reproduction or disclosure.

    (a) 10 U.S.C. 2320 requires, to the maximum extent practicable, an 
identification prior to delivery of any technical data to be delivered 
to the Government with restrictions on use.
    (b) Use the provision at 252.227-7017, Identification and Assertion 
of Use, Release, or Disclosure Restrictions, in all solicitations that 
include the clause at 252.227-7013, Rights in Technical Data--
Noncommercial Items. The provision requires offerors to identify any 
technical data for which restrictions, other than copyright, on use, 
release, or disclosure are asserted and to attach the identification and 
assertions to the offer.
    (c) Subsequent to contract award, the clause at 252.277-7013 permits 
a contractor, under certain conditions, to make additional assertions of 
use, release, or disclosure restrictions. The prescription for the use 
of that clause and its alternate is at 227.7103-6 (a) and (b).



227.7103-4  License rights.

    (a) Grant of license. The Government obtains rights in technical 
data, including a copyright license, under and irrevocable license 
granted or obtained for the Government by the contractor. The contractor 
or licensor retains all rights in the data not granted to the 
Government. For technical data that pertain to items, components, or 
processes, the scope of the license is generally determined by the 
source of funds used to develop the item, component, or process. When 
the technical data do not pertain to items, components, or processes, 
the scope of the license is determined by the source of funds used to 
create the data.
    (1) Techical data pertaining to items, components, or processes. 
Contractors or licensors may, with some exceptions (see 227.7103-5(a)(2) 
and (a)(4) through (9)), restrict the Government's rights to use, 
modify, release, reproduce, perform, display or disclose technical data 
pertaining to items, components, or processes developed exclusively at 
private expense (limited rights). They may not restrict the Government's 
rights in items, components, or processes developed exclusively at 
Government expense (unlimited rights) without the Government's approval. 
When an item, component, or process is developed with mixed funding, the 
Government may use, modify, release, reproduce, perform, display or 
disclose the data pertaining to such items, components, or processes 
within the Government without restriction but may release or disclose 
the data outside the Government only for government purposes (government 
purpose rights).
    (2) Technical data that do not pertain to items, components, or 
processes. Technical data may be created during the performance of a 
contract for a conceptual design or similar effort that does not require 
the development, manufacture, construction, or production of items, 
components or processes. The Government generally obtains unlimited 
rights in such data when the data were created exclusively with 
Government funds, government purpose rights when the data were created 
with mixed funding, and limited rights when the data were created 
exclusively at private expense.
    (b) Source of funds determination. The determination of the source 
of development funds for technical data pertaining to items, components, 
or processes should be made at any practical sub-item or subcomponent 
level or for any

[[Page 213]]

segregable portion of a process. Contractors may assert limited rights 
in a segregable sub-item, sub-component, or portion of a process which 
otherwise qualifies for limited rights under the clause at 252.227-7013, 
Rights in Technical Data--Noncommercial Items.



227.7103-5  Government rights.

    The standard license rights that a licensor grants to the Government 
are unlimited rights, government purpose rights, or limited rights. 
Those rights are defined in the clause at 252.227-7013, Rights in 
Technical Data--Noncommercial Items. In unusual situations, the 
standards rights may not satisfy the Government's needs or the 
Government may be willing to accept lesser rights in data in return for 
other consideration. In those cases, a special license may be 
negotiated. However, the licensor is not obligated to provide the 
Government greater rights and the contracting officer is not required to 
accept lesser rights than the rights provided in the standard grant of 
license. The situations under which a particular grant of license 
applies are enumerated in paragraphs (a) through (d) of this subsection.
    (a) Unlimited rights. The Government obtains unlimited rights in 
technical data that are--
    (1) Data pertaining to an item, component, or process which has been 
or will be developed exclusively with Government funds;
    (2) Studies, analyses, test data, or similar data produced in the 
performance of a contract when the study, analysis, test, or similar 
work was specified as an element of performance;
    (3) Created exclusively with Government funds in the performance of 
a contract that does not require the development, manufacture, 
construction, or production of items, components, or processes;
    (4) Form, fit, and function data;
    (5) Necessary for installation, operation, maintenance, or training 
purposes (other than detailed manufacturing or process data);
    (6) Corrections or changes to technical data furnished to the 
contractor by the Government;
    (7) Publicly available or have been released or disclosed by the 
contractor or subcontractor without restrictions on further use, release 
or disclosure other than a release or disclosure resulting from the 
sale, transfer, or other assignment of interest in the software to 
another party or the sale or transfer of some or all of a business 
entity or its assets to another party;
    (8) Data in which the Government has obtained unlimited rights under 
another Government contract or as a result of negotiations; or
    (9) Data furnished to the Government, under a Government contract or 
subcontract thereunder, with--
    (i) Government purpose license rights or limited rights and the 
restrictive condition(s) has/have expired; or
    (ii) Government purpose rights and the contractor's exclusive right 
to use such data for commercial purposes has expired.
    (b) Government purpose rights. (1) The Government obtains government 
purpose rights in technical data--
    (i) That pertain to items, components, or processes developed with 
mixed funding except when the Government is entitled to unlimited rights 
as provided in paragraphs (a)(2) and (a)(4) through (9) of this 
subsection; or
    (ii) Created with mixed funding in the performance of a contract 
that does not require the development, manufacture, construction, or 
production of items, components, or processes.
    (2) The period during which government purpose rights are effective 
is negotiable. The clause at 252.227-7013 provides a nominal five-year 
period. Either party may request a different period. Changes to the 
government purpose rights period may be made at any time prior to 
delivery of the technical data without consideration from either party. 
Longer periods should be negotiated when a five-year period does not 
provide sufficient time to apply the data for commercial purposes or 
when necessary to recognize subcontractors' interests in the data.
    (3) The government purpose rights period commences upon execution of 
the contract, subcontract, letter contract (or similar contractual 
instrument), contract modification, or option exercise that required the 
development. Upon expiration of the Government rights period, the 
Government

[[Page 214]]

has unlimited rights in the data including the right to authorize others 
to use the data for commercial purposes.
    (4) During the government purpose rights period, the government may 
not use, or authorize other persons to use, technical data marked with 
government purpose rights legends for commercial purposes. The 
Government shall not release or disclose data in which it has government 
purpose rights to any person, or authorize others to do so, unless--
    (i) Prior to release or disclosure, the intended recipient is 
subject to the use and non-disclosure agreement at 227.7103-7; or
    (ii) The intended recipient is a Government contractor receiving 
access to the data for performance of a Government contract that 
contains the clause at 252.227-7025, Limitations on the Use or 
Disclosure of Government-Furnished Information Marked with Restrictive 
Legends.
    (5) When technical data marked with government purpose rights 
legends will be released or disclosed to a Government contractor 
performing a contract that does not include the clause at 252-227-7025, 
the contract may be modified, prior to release or disclosure, to include 
that clause in lieu of requiring the contractor to complete a use and 
non-disclosure agreement.
    (6) Contracting activities shall establish procedures to assure that 
technical data marked with government purpose rights legends are 
released or disclosed, including a release or disclosure through a 
Government solicitation, only to persons subject to the use and non-
disclosure restrictions. Public announcements in the Commerce Business 
Daily or other publications must provide notice of the use and non-
disclosure requirements. Class use and non-disclosure agreements (e.g., 
agreements covering all solicitations received by the XYZ company within 
a reasonable period) are authorized and may be obtained at any time 
prior to release or disclosure of the government purpose rights data. 
Documents transmitting government purpose rights data to persons under 
class agreements shall identify the technical data subject to government 
purpose rights and the class agreement under which such data are 
provided.
    (c) Limited rights. (1) The Government obtains limited rights in 
technical data--
    (i) That pertain to items, components, or processes developed 
exclusively at private expense except when the Government is entitled to 
unlimited rights as provided in paragraphs (a)(2) and (a)(4) through (9) 
of this subsection; or
    (ii) Created exclusively at private expense in the performance of a 
contract that does not require the development, manufacture, 
construction, or production of items, components, or processes.
    (2) Data in which the Government has limited rights may not be used, 
released, or disclosed outside the Government without the permission of 
the contractor asserting the restriction except for a use, release or 
disclosure that is--
    (i) Necessary for emergency repair and overhaul; or
    (ii) To a foreign government, other than detailed manufacturing or 
process data, when use, release, or disclosure is in the interest of the 
United States and is required for evaluation or informational purposes.
    (3) The person asserting limited rights must be notified of the 
Government's intent to release, disclose, or authorize others to use 
such data prior to release or disclosure of the data except notification 
of an intended release, disclosure, or use for emergency repair or 
overhaul which shall be made as soon as practicable.
    (4) When the person asserting limited rights permits the Government 
to release, disclose, or have others use the data subject to 
restrictions on further use, release, or disclosure, or for a release 
under paragraph (c)(2)(i) or (ii) of this subsection, the intended 
recipient must complete the use and non-disclosure agreement at 
227.7103-7 prior to release or disclosure of the limited rights data.
    (d) Specifically negotiated license rights. (1) Negotiate specific 
licenses when the parties agree to modify the standard license rights 
granted to the government or when the government wants to obtain rights 
in data in which

[[Page 215]]

it does not have rights. When negotiating to obtain, relinquish, or 
increase the Government's rights in technical data, consider the 
acquisition strategy for the item, component, or process, including 
logistics support and other factors which may have relevance for a 
particular procurement. The Government may accept lesser rights when it 
has unlimited or government purpose rights in data but may not accept 
less than limited rights in such data. The negotiated license rights 
must stipulate what rights the Government has to release or disclose the 
data to other persons or to authorize others to use the data. Identify 
all negotiated rights in a license agreement made part of the contract.
    (2) When the Government needs additional rights in data acquired 
with government purpose or limited rights, the contracting officer must 
negotiate with the contractor to determine whether there are acceptable 
terms for transferring such rights. Generally, such negotiations should 
be conducted only when there is a need to disclose the data outside the 
Government or if the additional rights are required for competitive 
reprocurement and the anticipated savings expected to be obtained 
through competition are estimated to exceed the acquisition cost of the 
additional rights. Prior to negotiating for additional rights in limited 
rights data, consider alternatives such as--
    (i) Using performance specifications and form, fit, and function 
data to acquire or develop functionally equivalent items, components, or 
processes;
    (ii) Obtaining a contractor's contractual commitment to qualify 
additional sources and maintain adequate competition among the sources; 
or
    (iii) Reverse engineering, or providing items from Government 
inventories to contractors who request the items to facilitate the 
development of equivalent items through reverse engineering.



227.7103-6  Contract clauses.

    (a) Use the clause at 252.227-7013, Rights in Technical Data--
Noncommercial Items, in solicitations and contracts when the successful 
offeror(s) will be required to deliver technical data to the Government. 
Do not use the clause when the only deliverable items are computer 
software or computer software documentation (see 227.72), commercial 
items (see 227.7102-3), existing works (see 227.7105), special works 
(see 227.7106), or when contracting under the Small Business Innovation 
Research Program (see 227.7104). Except as provided in 227.7107-2, do 
not use the clause in architect-engineer and construction contracts.
    (b) Use the clause at 252.227-7013 with its Alternate I in research 
contracts when the contracting officer determines, in consultation with 
counsel, that public dissemination by the contractor would be--
    (1) In the interest of the government; and
    (2) Facilitated by the Government relinquishing its right to publish 
the work for sale, or to have others publish the work for sale on behalf 
of the Government.
    (c) Use the clause at 252.227-7025, Limitations on the Use or 
Disclosure of Government Furnished Information Marked with Restrictive 
Legends, in solicitations and contracts when it is anticipated that the 
Government will provide the contractor, for performance of its contract, 
technical data marked with another contractor's restrictive legend(s).
    (d) Use the provision at 252.227-7028, Technical Data or Computer 
Software Previously Delivered to the Government, in solicitations when 
the resulting contract will require the contractor to deliver technical 
data. The provision requires offerors to identify any technical data 
specified in the solicitations as deliverable data items that are the 
same or substantially the same as data items the offeror has delivered 
or is obligated to deliver, either as a contractor or subcontractor, 
under any other federal agency contract.
    (e) Use the following clauses in solicitations and contracts that 
include the clause at 252.227-7013:
    (1) 252.227-7016, Rights in Bid or Proposal Information;
    (2) 252.227-7030, Technical Data--Withholding of Payment;
    (3) 252.227-7036, Declaration of Technical Data Conformity; and

[[Page 216]]

    (4) 252.227-7037, Validation of Restrictive Markings on Technical 
Data (paragraph (e) of the clause contains information that must be 
included in a challenge).
[60 FR 33471, June 28, 1995; 60 FR 41157, Aug. 11, 1995; 60 FR 61598, 
Nov. 30, 1995; 62 FR 2613, Jan. 17, 1997]



227.7103-7  Use and non-disclosure agreement.

    (a) Except as provided in paragraph (b) of this subsection, 
technical data or computer software delivered to the Government with 
restrictions on use, modification, reproduction, release, performance, 
display, or disclosure may not be provided to third parties unless the 
intended recipient completes and signs the use and non-disclosure 
agreement at paragraph (c) of this subsection prior to release, or 
disclosure of the data.
    (1) The specific conditions under which an intended recipient will 
be authorized to use, modify, reproduce, release, perform, display, or 
disclose technical data subject to limited rights or computer software 
subject to restricted rights must be stipulated in an attachment to the 
use and non-disclosure agreement.
    (2) For an intended release, disclosure, or authorized use of 
technical data or computer software subject to special license rights, 
modify paragraph (1)(d) of the use and non-disclosure agreement to enter 
the conditions, consistent with the license requirements, governing the 
recipient's obligations regarding use, modification, reproduction, 
release, performance, display or disclosure of the data or software.
    (b) The requirement for use and non-disclosure agreements does not 
apply to Government contractors which require access to a third party's 
data or software for the performance of a Government contract that 
contains the clause at 252.227-7025, Limitations on the Use or 
Disclosure of Government-Furnished Information Marked with Restrictive 
Legends.
    (c) The prescribed use and non-disclosure agreement is:

                    Use and Non-Disclosure Agreement

    The undersigned, ________________ (Insert Name) ________________, an 
authorized representative of the ________________ (Insert Company Name) 
________________, (which is hereinafter referred to as the 
``Recipient'') requests the Government to provide the Recipient with 
technical data or computer software (hereinafter referred to as 
``Data'') in which the Government's use, modification, reproduction, 
release, performance, display or disclosure rights are restricted. Those 
Data are identified in an attachment to this Agreement. In consideration 
for receiving such Data, the Recipient agrees to use the Data strictly 
in accordance with this Agreement:
    (1) The Recipient shall--
    (a) Use, modify, reproduce, release, perform, display, or disclose 
Data marked with government purpose rights or SBIR data rights legends 
only for government purposes and shall not do so for any commercial 
purpose. The Recipient shall not release, perform, display, or disclose 
these Data, without the express written permission of the contractor 
whose name appears in the restrictive legend (the ``Contractor''), to 
any person other than its subcontractors or suppliers, or prospective 
subcontractors or suppliers, who require these Data to submit offers 
for, or perform, contracts with the Recipient. The Recipient shall 
require its subcontractors or suppliers, or prospective subcontractors 
or suppliers, to sign a use and non-disclosure agreement prior to 
disclosing or releasing these Data to such persons. Such agreement must 
be consistent with the terms of this agreement.
    (b) Use, modify, reproduce, release, perform, display, or disclose 
technical data marked with limited rights legends only as specified in 
the attachment to this Agreement. Release, performance, display, or 
disclosure to other persons is not authorized unless specified in the 
attachment to this Agreement or expressly permitted in writing by the 
Contractor. The Recipient shall promptly notify the Contractor of the 
execution of this Agreement and identify the Contractor's Data that has 
been or will be provided to the Recipient, the date and place the Data 
were or will be received, and the name and address of the Government 
office that has provided or will provide the Data.
    (c) Use computer software marked with restricted rights legends only 
in performance of Contract Number ________________ (insert contract 
number(s)) ________________. The recipient shall not, for example, 
enhance, decompile, disassemble, or reverse engineer the software; time 
share, or use a computer program with more than one computer at a time. 
The recipient may not release, perform, display, or disclose such 
software to others unless expressly permitted in writing

[[Page 217]]

by the licensor whose name appears in the restrictive legend. The 
Recipient shall promptly notify the software licensor of the execution 
of this Agreement and identify the software that has been or will be 
provided to the Recipient, the date and place the software were or will 
be received, and the name and address of the Government office that has 
provided or will provide the software.
    (d) Use, modify, reproduce, release, perform, display, or disclose 
Data marked with special license rights legends (To be completed by the 
contracting officer. See 227.7103-7(a)(2). Omit if none of the Data 
requested is marked with special license rights legends).
    (2) The Recipient agrees to adopt or establish operating procedures 
and physical security measures designed to protect these Data from 
inadvertent release or disclosure to unauthorized third parties.
    (3) The Recipient agrees to accept these Data ``as is'' without any 
Government representation as to suitability for intended use or warranty 
whatsoever. This disclaimer does not affect any obligation the 
Government may have regarding Data specified in a contract for the 
performance of that contract.
    (4) The Recipient may enter into any agreement directly with the 
Contractor with respect to the use, modification, reproduction, release, 
performance, display, or disclosure of these Data.
    (5) The Recipient agrees to indemnify and hold harmless the 
Government, its agents, and employees from every claim or liability, 
including attorneys fees, court costs, and expenses arising out of, or 
in any way related to, the misuse or unauthorized modification, 
reproduction, release, performance, display, or disclosure of Data 
received from the Government with restrictive legends by the Recipient 
or any person to whom the Recipient has released or disclosed the Data.
    (6) The Recipient is executing this Agreement for the benefit of the 
Contractor. The Contractor is a third party beneficiary of this 
Agreement who, in addition to any other rights it may have, is intended 
to have the rights of direct action against the Recipient or any other 
person to whom the Recipient has released or disclosed the Data, to seek 
damages from any breach of this Agreement or to otherwise enforce this 
Agreement.
    (7) The Recipient agrees to destroy these Data, and all copies of 
the Data in its possession, no later than 30 days after the date shown 
in paragraph (8) of this Agreement, to have all persons to whom it 
released the Data do so by that date, and to notify the Contractor that 
the Data have been destroyed.
    (8) This Agreement shall be effective for the period commencing with 
the Recipient's execution of this Agreement and ending upon ________ 
(Insert Date) ________. The obligations imposed by this Agreement shall 
survive the expiration or termination of the Agreement.
 Recipient's Business Name______________________________________________
 By_____________________________________________________________________
Authorized Representative

 _______________________________________________________________________
Date

 Representative's Typed Name____________________________________________
 and Title______________________________________________________________

(End of use and non-disclosure agreement)



227.7103-8  Deferred delivery and deferred ordering of technical data.

    (a) Deferred delivery. Use the clause at 252.227-7026, Deferred 
Delivery of Technical Data or Computer Software, when it is in the 
Government's interests to defer the delivery of technical data. The 
clause permits the contracting officer to require the delivery of 
technical data identified as ``deferred delivery'' data at any time 
until two years after acceptance by the Government of all items (other 
than technical data or computer software) under the contract or contract 
termination, whichever is later. The obligation of subcontractors or 
suppliers to deliver such technical data expires two years after the 
date the prime contractor accepts the last item from the subcontractor 
or supplier for use in the performance of the contract. The contract 
must specify which technical data is subject to deferred delivery. The 
contracting officer shall notify the contractor sufficiently in advance 
of the desired delivery date for such data to permit timely delivery.
    (b) Deferred ordering. Use the clause at 252.227-7027, Deferred 
Ordering of Technical Data or Computer Software, when a firm requirement 
for a particular data item(s) has not been established prior to contract 
award but there is a potential need for the data. Under this clause, the 
contracting officer may order any data that has been generated in the 
performance of the contract or any subcontract thereunder at any time 
until three years after acceptance of all items (other than technical 
data or computer software) under the contract or contract termination, 
whichever is later. The obligation of subcontractors to deliver such 
data expires three years after the date the contractor accepts the last

[[Page 218]]

item under the subcontract. When the data are ordered, the delivery 
dates shall be negotiated and the contractor compensated only for 
converting the data into the prescribed form, reproduction costs, and 
delivery costs.



227.7103-9  Copyright.

    (a) Copyright license. (1) The clause at 252.227-7013, Rights in 
Technical Data--Noncommercial Items, requires a contractor to grant or 
obtain for the Government license rights which permit the Government to 
reproduce data, distribute copies of the data, publicly perform or 
display the data or, through the right to modify data, prepare 
derivative works. The extent to which the Government, and others acting 
on its behalf, may exercise these rights varies for each of the standard 
data rights licenses obtained under the clause. When non-standard 
license rights in technical data will be negotiated, negotiate the 
extent of the copyright license concurrent with negotiations for the 
data rights license. Do not negotiate a copyright license that provides 
less rights than the standard limited rights license in technical data.
    (2) The clause at 252.227-7013 does not permit a contractor to 
incorporate a third party's copyrighted data into a deliverable data 
item unless the contractor has obtained an appropriate license for the 
Government and, when applicable, others acting on the Government's 
behalf, or has obtained the contracting officer's written approval to do 
so. Grant approval to use third party copyrighted data in which the 
Government will not receive a copyright license only when the 
Government's requirements cannot be satisfied without the third party 
material or when the use of the third party material will result in cost 
savings to the Government which outweigh the lack of a copyright 
license.
    (b) Copyright considerations--acquisition of existing and special 
works. See 227.7105 or 227.7106 for copyright considerations when 
acquiring existing or special works.



227.7103-10  Contractor identification and marking of technical data to be furnished with restrictive markings.

    (a) Identification requirements. (1) The solicitation provision at 
252.227-7017, Identification and Assertion of Use, Release, or 
Disclosure Restrictions, requires offerors to identify to the 
contracting officer, prior to contract award, any technical data that 
the offeror asserts should be provided to the Government with 
restrictions on use, modification, reproduction, release or disclosure. 
This requirement does not apply to restrictions based solely on 
copyright. The notification and identification must be submitted as an 
attachment to the offer. If an offeror fails to submit the attachment or 
fails to complete the attachment in accordance with the requirements of 
the solicitation provision, such failure shall constitute a minor 
informality. Provide offerors an opportunity to remedy a minor 
informality in accordance with the procedures at FAR 14.405 or 15.607. 
An offeror's failure to correct the informality within the time 
prescribed by the contracting officer shall render the offer ineligible 
for award.
    (2) The procedures for correcting minor informalities shall not be 
used to obtain information regarding asserted restrictions or an 
offeror's suggested asserted rights category. Questions regarding the 
justification for an asserted restriction or asserted rights category 
must be pursued in accordance with the procedures at 227.7103-13.
    (3) The restrictions asserted by a successful offeror shall be 
attached to its contract unless, in accordance with the procedures at 
227.7103-13, the parties have agreed that an asserted restriction is not 
justified. The contract attachment shall provide the same information 
regarding identification of the technical data, the asserted rights 
category, the basis for the assertion, and the name of the person 
asserting the restrictions as required by paragraph (d) of the 
solicitation provision at 252.227-7017. Subsequent to contract award, 
the clause at 252.227-7013, Rights in Technical Data--Noncommercial 
Items, permits the contractor to make

[[Page 219]]

additional assertions under certain conditions. The additional 
assertions must be made in accordance with the procedures and in the 
format prescribed by that clause.
    (4) Neither the pre- or post-award assertions made by the 
contractor, nor the fact that certain assertions are identified in the 
attachment to the contract, determine the respective rights of the 
parties. As provided at 227.7103-13, the Government has the right to 
review, verify, challenge and validate restrictive markings.
    (5) Information provided by offerors in response to the solicitation 
provision may be used in the source selection process to evaluate the 
impact on evaluation factors that may be created by restrictions on the 
Government's ability to use or disclose technical data. However, 
offerors shall not be prohibited from offering products for which the 
offeror is entitled to provide the Government limited rights in the 
technical data pertaining to such products and offerors shall not be 
required, either as a condition of being responsive to a solicitation or 
as a condition for award, to sell or otherwise relinquish any greater 
rights in technical data when the offeror is entitled to provide the 
technical data with limited rights.
    (b) Contractor marking requirements. The clause at 252.227-7013, 
Rights in Technical Data--Noncommercial Items--
    (1) Requires a contractor that desires to restrict the Government's 
rights in technical data to place restrictive markings on the data, 
provides instructions for the placement of the restrictive markings, and 
authorizes the use of certain restrictive markings; and
    (2) Requires a contractor to deliver, furnish, or otherwise provide 
to the Government any technical data in which the Government has 
previously obtained rights with the Government's pre-existing rights in 
that data unless the parties have agreed otherwise or restrictions on 
the Government's rights to use, modify, reproduce, release, perform, 
display, or disclose the data have expired. When restrictions are still 
applicable, the contractor is permitted to mark the data with the 
appropriate restrictive legend for which the data qualified.
    (c) Unmarked technical data. (1) Technical data delivered or 
otherwise provided under a contract without restrictive markings shall 
be presumed to have been delivered with unlimited rights and may be 
released or disclosed without restriction. To the extent practicable, if 
a contractor has requested permission (see paragraph (c)(2) of this 
subsection) to correct an inadvertent omission of markings, do not 
release or disclose the technical data pending evaluation of the 
request.
    (2) A contractor may request permission to have appropriate legends 
placed on unmarked technical data at its expense. The request must be 
received by the contracting officer within six months following the 
furnishing or delivery of such data, or any extension of that time 
approved by the contracting officer. The person making the request must:
    (i) Identify the technical data that should have been marked;
    (ii) Demonstrate that the omission of the marking was inadvertent, 
the proposed marking is justified and conforms with the requirements for 
the marking of technical data contained in the clause at 252.227-7013; 
and
    (iii) Acknowledge, in writing, that the Government has no liability 
with respect to any disclosure, reproduction, or use of the technical 
data made prior to the addition of the marking or resulting from the 
omission of the marking.
    (3) Contracting officers should grant permission to mark only if the 
technical data were not distributed outside the Government or were 
distributed outside the Government with restrictions on further use or 
disclosure.



227.7103-11  Contractor procedures and records.

    (a) The clause at 252.227-7013, Rights in Technical Data--
Noncommercial Items, requires a contractor, and its subcontractors or 
suppliers that will deliver technical data with other than unlimited 
rights, to establish and follow written procedures to assure that 
restrictive markings are used only when authorized and to maintain

[[Page 220]]

records to justify the validity of asserted restrictions on delivered 
data.
    (b) The clause at 252.227-7037, Validation of Restrictive Markings 
on Technical Data requires contractors and their subcontractors at any 
tier to maintain records sufficient to justify the validity of 
restrictive markings on technical data delivered or to be delivered 
under a Government contract.



227.7103-12  Government right to establish conformity of markings.

    (a) Nonconforming markings. (1) Authorized markings are identified 
in the clause at 252.227-7013, Rights in Technical Data--Noncommercial 
Items. All other markings are nonconforming markings. An authorized 
marking that is not in the form, or differs in substance, from the 
marking requirements in the clause at 252.227-7013 is also a 
nonconforming marking.
    (2) The correction of nonconforming markings on technical data is 
not subject to 252.227-7037, Validation of Restrictive Markings on 
Technical Data. To the extent practicable, the contracting officer 
should return technical data bearing nonconforming markings to the 
person who has placed the nonconforming markings on such data to provide 
that person an opportunity to correct or strike the nonconforming 
marking at that person's expense. If that person fails to correct the 
nonconformity and return the corrected data within 60 days following the 
person's receipt of the data, the contracting officer may correct or 
strike the nonconformity at that person's expense. When it is 
impracticable to return technical data for correction, contracting 
officers may unilaterally correct any nonconforming markings at 
Government expense. Prior to correction, the data may be used in 
accordance with the proper restrictive marking.
    (b) Unjustified markings. (1) An unjustified marking is an 
authorized marking that does not depict accurately restrictions 
applicable to the Government's use, modification, reproduction, release, 
performance, display, or disclosure of the marked technical data. For 
example, a limited rights legend placed on technical data pertaining to 
items, components, or processes that were developed under a Government 
contract either exclusively at Government expense or with mixed funding 
(situations under which the Government obtains unlimited or government 
purpose rights) is an unjustified marking.
    (2) Contracting officers have the right to review and challenge the 
validity of unjustified markings. However, at any time during 
performance of a contract and notwithstanding existence of a challenge, 
the contracting officer and the person who has asserted a restrictive 
marking may agree that the restrictive marking is not justified. Upon 
such agreement, the contracting officer may, at his or her election, 
either--
    (i) Strike or correct the unjustified marking at that person's 
expense; or
    (ii) Return the technical data to the person asserting the 
restriction for correction at that person's expense. If the data are 
returned and that person fails to correct or strike the unjustified 
restriction and return the corrected data to the contracting officer 
within 60 days following receipt of the data, the unjustified marking 
shall be corrected or stricken at that person's expense.



227.7103-13  Government right to review, verify, challenge and validate asserted restrictions.

    (a) General. An offeror's assertion(s) of restrictions on the 
Government's rights to use, modify, reproduce, release, or disclose 
technical data do not, by themselves, determine the extent of the 
Government's rights in the technical data. Under 10 U.S.C. 2321, the 
Government has the right to challenge asserted restrictions when there 
are reasonable grounds to question the validity of the assertion and 
continued adherence to the assertion would make it impractical to later 
procure competitively the item to which the data pertain.
    (b) Pre-award considerations. The challenge procedures required by 
10 U.S.C. 2321 could significantly delay awards under competitive 
procurements. Therefore, avoid challenging asserted restrictions prior 
to a competitive contract award unless resolution of the assertion is 
essential for successful completion of the procurement.

[[Page 221]]

    (c) Challenge and validation. Contracting officers must have 
reasonable grounds to challenge the current validity of an asserted 
restriction. Before issuing a challenge to an asserted restriction, 
carefully consider all available information pertaining to the 
assertion. All challenges must be made in accordance with the provisions 
of the clause at 252.227-7037, Validation of Restrictive Markings on 
Technical Data.
    (1) Challenge period. Asserted restrictions should be reviewed 
before acceptance of technical data deliverable under the contract. 
Assertions must be challenged within three years after final payment 
under the contract or three years after delivery of the data, whichever 
is later. However, restrictive markings may be challenged at any time if 
the technical data--
    (i) Are publicly available without restrictions;
    (ii) Have been provided to the United States without restriction; or
    (iii) Have been otherwise made available without restriction other 
than a release or disclosure resulting from the sale, transfer, or other 
assignment of interest in the technical data to another party or the 
sale or transfer of some or all of a business entity or its assets to 
another party.
    (2) Pre-challenge requests for information. (i) After consideration 
of the situation described in paragraph (c)(3) of this subsection, 
contracting officers may request the person asserting a restriction to 
furnish a written explanation of the facts and supporting documentation 
for the assertion in sufficient detail to enable the contracting officer 
to ascertain the basis of the restrictive markings. Additional 
supporting documentation may be requested when the explanation provided 
by the person making the assertion does not, in the contracting 
officer's opinion, establish the validity of the assertion.
    (ii) If the person asserting the restriction fails to respond to the 
contracting officer's request for information or additional supporting 
documentation, or if the information submitted or any other available 
information pertaining to the validity of a restrictive marking does not 
justify the asserted restriction, a challenge should be considered.
    (3) Transacting matters directly with subcontracts. The clause at 
252.227-7037 obtains the contractor's agreement that the Government may 
transact matters under the clause directly with a subcontractor, at any 
tier, without creating or implying privity of contract. Contracting 
officers should permit a subcontractor or supplier to transact challenge 
and validation matters directly with the Government when--
    (i) A subcontractor's or supplier's business interests in its 
technical data would be compromised if the data were disclosed to a 
higher tier contractor;
    (ii) There is reason to believe that the contractor will not respond 
in a timely manner to a challenge and an untimely response would 
jeopardize a subcontractor's or suppliers right to assert restrictions; 
or
    (iii) Requested to do so by a subcontractor or supplier.
    (4) Challenge notice. Do not issue a challenge notice unless there 
are reasonable grounds to question the validity of an assertion. 
Assertions may be challenged whether or not supporting documentation was 
requested from the person asserting the restriction. Challenge notices 
must be in writing and issued to the contractor or, after consideration 
of the situations described in paragraph (c)(3) of this subsection, the 
person asserting the restriction. The challenge notice must include the 
information in paragraph (e) of the clause at 252.227-7037.
    (5) Extension of response time. The contracting officer, at his or 
her discretion, may extend the time for response contained in a 
challenge notice, as appropriate, if the contractor submits a timely 
written request showing the need for additional time to prepare a 
response.
    (6) Contracting officer's final decision. Contracting officers must 
issue a final decision for each challenged assertion, whether or not the 
assertion has been justified.
    (i) A contracting officer's final decision that an assertion is not 
justified must be issued a soon as practicable following the failure of 
the person asserting the restriction to respond to the contracting 
officer's challenge within 60 days, or any extension to

[[Page 222]]

that time granted by the contracting officer.
    (ii) A contracting officer who, following a challenge and response 
by the person asserting the restriction, determines that an asserted 
restriction is justified, shall issue a final decision sustaining the 
validity of the asserted restriction. If the asserted restriction was 
made subsequent to submission of the contractor's offer, add the 
asserted restriction to the contract attachment.
    (iii) A contracting officer who determine that the validity of an 
asserted restriction has not been justified shall issue a contracting 
officer's final decision within the time frames prescribed in 252.227-
7037. As provided in paragraph (g) of that clause, the Government is 
obligated to continue to respect the asserted restrictions through final 
disposition of any appeal unless the agency head notifies the person 
asserting the restriction that urgent or compelling circumstances do not 
permit the Government to continue to respect the asserted restriction.
    (7) Multiple challenges to an asserted restriction. When more than 
one contracting officer challenges an asserted restriction, the 
contracting officer who made the earliest challenge is responsible for 
coordinating the Government challenges. That contracting officer shall 
consult with all other contracting officers making challenges, verify 
that all challenges apply to the same asserted restriction and, after 
consulting with the contractor, subcontractor, or supplier asserting the 
restriction, issue a schedule that provides that person a reasonable 
opportunity to respond to each challenge.
    (8) Validation. Only a contracting officer's final decision, or 
actions of an agency board of contract appeals or a court of competent 
jurisdiction, that sustain the validity of an asserted restriction 
constitute validation of the asserted restriction.



227.7103-14  Conformity, acceptance, and warranty of technical data.

    (a) Statutory requirements. 10 U.S.C. 2320--
    (1) Requires contractors to furnish written assurance, at the time 
technical data are delivered or are made available to the Government, 
that the technical data are complete, accurate, and satisfy the 
requirements of the contract concerning such data;
    (2) Provides for the establishment of remedies applicable to 
technical data found to be incomplete, inadequate, or not to satisfy the 
requirements of the contract concerning such data; and
    (3) Authorizes agency heads to withhold payments (or exercise such 
other remedies an agency head considers appropriate) during any period 
if the contractor does not meet the requirements of the contract 
pertaining to the delivery of technical data.
    (b) Conformity and acceptance. (1) Solicitations and contracts 
requiring the delivery of technical data shall specify the requirements 
the data must satisfy to be acceptable. Contracting officers, or their 
authorized representatives, are responsible for determining whether 
technical data tendered for acceptance conform to the contractual 
requirements.
    (2) The clause at 252.227-7030, Technical Data--Withholding of 
Payment, provides for withholding up to 10 percent of the contract price 
pending correction or replacement of the nonconforming technical data or 
negotiation of an equitable reduction in contract price. The amount 
subject to withholding may be expressed as a fixed dollar amount or as a 
percentage of the contract price. In either case, the amount shall be 
determined giving consideration to the relative value and importance of 
the data. For example--
    (i) When the sole purpose of a contract is to produce the data, the 
relative value of that data may be considerably higher than the value of 
data produced under a contract where the production of the data is a 
secondary objective; or
    (ii) When the Government will maintain or repair items, repair and 
maintenance data may have a considerably higher relative value than data 
that merely describe the item or provide performance characteristics.
    (3) Do not accept technical data that do not conform to the 
contractual requirements in all respects. Except for nonconforming 
restrictive markings (see paragraph (b)(4) of this subsection), 
correction or replacement of

[[Page 223]]

nonconforming data or an equitable reduction in contract price when 
correction or replacement of the nonconforming data is not practicable 
or is not in the Government's interests, shall be accomplished in 
accordance with--
    (i) The provisions of a contract clause providing for inspection and 
acceptance of deliverables and remedies for nonconforming deliverables; 
or
    (ii) The procedures at FAR 46.407(c) through (g), if the contract 
does not contain an inspection clause providing remedies for 
nonconforming deliverables.
    (4) Follow the procedures at 227.7103-12(a)(2) if nonconforming 
markings are the sole reason technical data fail to conform to 
contractual requirements. The clause at 252.227-7030 may be used to 
withhold an amount for payment, consistent with the terms of the clause, 
pending correction of the nonconforming markings.
    (c) Warranty. (1) The intended use of the technical data and the 
cost, if any, to obtain the warranty should be considered before 
deciding to obtain a data warranty (see FAR 46.703). The fact that a 
particular item, component, or process is or is not warranted is not a 
consideration in determining whether or not to obtain a warranty for the 
technical data that pertain to the item, component, or process. For 
example, a data warranty should be considered if the Government intends 
to repair or maintain an item and defective repair or maintenance data 
would impair the Government's effective use of the item or result in 
increased costs to the Government.
    (2) As prescribed in 246.710, use the clause at 252.246-7001, 
Warranty of Data, and its alternates, or a substantially similar clause 
when the Government needs a specific warranty of technical data.



227.7103-15  Subcontractor rights in technical data.

    (a) 10 U.S.C. 2320 provides subcontractors at all tiers the same 
protection for their rights in data as is provided to prime contractors. 
The clauses at 252.227-7013, Rights in Technical Data--Noncommercial 
Items, and 252.227-7037, Validation of Restrictive Markings on Technical 
Data, implement the statutory requirements.
    (b) 10 U.S.C. 2321 permits a subcontractor to transact directly with 
the Government matters relating to the validation of its asserted 
restrictions on the Government's rights to use or disclose technical 
data. The clause at 252.227-7037 obtains a contractor's agreement that 
the direct transaction of validation or challenge matters with 
subcontractors at any tier does not establish or imply privity of 
contract. When a subcontractor or supplier exercise its right to 
transact validation matters directly with the Government, contracting 
officers shall deal directly with such persons, as provided at 227.7103-
13(c)(3).
    (c) Require prime contractors whose contracts include the following 
clauses to include those clauses, without modification except for 
appropriate identification of the parties, in contracts with 
subcontractors or suppliers, at all tiers, who will be furnishing 
technical data for non-commercial items in response to a Government 
requirement:
    (1) 252.227-7013, Rights in Technical Data--Noncommercial Items;
    (2) 252.227-7025, Limitations on the Use or Disclosure of 
Government-Furnished Information Marked with Restrictive Legends;
    (3) 252.227-7028, Technical Data or Computer Software Previously 
Delivered to the Government; and
    (4) 252.227-7037, Validation of Restrictive Markings on Technical 
Data.
    (d) Do not require contractors to have their subcontractors or 
suppliers at any tier relinquish rights in technical data to the 
contractor, a higher tier subcontractor, or to the Government, as a 
condition for award of any contract, subcontract, purchase order, or 
similar instrument except for the rights obtained by the Government 
under the Rights in Technical Data--Noncommercial Items clause contained 
in the contractor's contract with the Government.
[56 FR 36389, July 31, 1991, as amended at 60 FR 61598, Nov. 30, 1995]

[[Page 224]]



227.7103-16  Providing technical data to foreign governments, foreign contractors, or international organizations.

    Technical data may be released or disclosed to foreign governments, 
foreign contractors, or international organizations only if release or 
disclosure is otherwise permitted both by Federal export controls and 
other national security laws or regulations. Subject to such laws and 
regulations, the Department of Defense--
    (a) May release or disclose technical data in which it has obtained 
unlimited rights to such foreign entities or authorize the use of such 
data by those entities; and
    (b) Shall not release or disclose technical data for which 
restrictions on use, release, or disclosure have been asserted to 
foreign entities, or authorize the use of technical data by those 
entities, unless the intended recipient is subject to the same 
provisions as included in the use and non-disclosure agreement at 
227.7103-7 and the requirements of the clause at 252.227-7103, Rights in 
Technical Data--Noncommercial Items, governing use, modification, 
reproduction, release, performance, display, or disclosure of such data 
have been satisfied.



227.7103-17  Overseas contracts with foreign sources.

    (a) The clause at 252.227-7032, Rights in Technical Data and 
Computer Software (Foreign), may be used in contracts with foreign 
contractors to be performed overseas, except Canadian purchases (see 
paragraph (c) of this subsection), in lieu of the clause at 252.227-
7013, Rights in Technical Data--Noncommercial Items, when the Government 
requires the unrestricted right to use, modify, reproduce, perform, 
display, release or disclose all technical data to be delivered under 
the contract. Do not use the clause in contracts for existing or special 
works.
    (b) When the Government does not require unlimited rights, the 
clause at 252.227-7032 may be modified to accommodate the needs of a 
specific overseas procurement situation. The Government should obtain 
rights in the technical data that are not less than the rights the 
Government would have obtained under the data rights clause(s) 
prescribed in this part for a comparable procurement performed within 
the United States or its possessions.
    (c) Contracts for Canadian purchases shall include the appropriate 
data rights clause prescribed in this part for a comparable procurement 
performed within the United States or its possessions.



227.7104  Contracts under the Small Business Innovation Research (SBIR) Program.

    (a) Use the clause at 252.227-7018, Rights in Noncommercial 
Technical Data and Computer Software--Small Business Innovation Research 
(SBIR) Program, when technical data or computer software will be 
generated during performance of contracts under the SBIR program.
    (b) Under the clause at 252.227-7018, the Government obtains a 
royalty-free license to use technical data marked with an SBIR data 
rights legend only for government purposes during the period commencing 
with contract award and ending five years after completion of the 
project under which the data were generated. Upon expiration of the 
five-year restrictive license, the Government has unlimited rights in 
the SBIR data. During the license period, the Government may not release 
or disclose SBIR data to any person other than its support services 
contractors except--
    (1) For evaluational purposes;
    (2) As expressly permitted by the contractor; or
    (3) A use, release, or disclosure that is necessary for emergency 
repair or overhaul of items operated by the Government.
    (c) Do not make any release or disclosure permitted by paragraph (b) 
of this section unless, prior to release or disclosure, the intended 
recipient is subject to the use and nondisclosure agreement at 227.7103-
7.
    (d) Use the clause at 252.227-7018 with its Alternate I in research 
contracts when the contracting officer determines, in consultation with 
counsel, that public dissemination by the contractor would be--
    (1) In the interest of the Government; and

[[Page 225]]

    (2) Facilitated by the Government relinquishing its right to publish 
the work for sale, or to have others publish the work for sale on behalf 
of the Government.
    (e) Use the following provision and clauses in SBIR solicitations 
and contracts that include the clause at 252.227-7018:
    (1) 252.227-7016, Rights in Bid or Proposal Information;
    (2) 252.227-7017, Identification and Assertion of Use, Release, or 
Disclosure Restrictions;
    (3) 252.227-7019, Validation of Asserted Restrictions--Computer 
Software;
    (4) 252.227-7030, Technical Data--Withholding of Payment;
    (5) 252.227-7036, Declaration of Technical Data Conformity; and
    (6) 252.227-7037, Validation of Restrictive Markings on Technical 
Data (paragraph (e) of the clause contains information that must be 
included in a challenge).
    (f) Use the following clauses and provision in SBIR solicitations 
and contracts in accordance with the guidance at 227.7103-6 (c) and (d):
    (1) 252.227-7025, Limitations on the Use or Disclosure of 
Government-Furnished Information Marked with Restrictive Legends; and
    (2) 252.227-7028, Technical Data or Computer Software Previously 
Delivered to the Government.
[56 FR 36389, July 31, 1991, as amended at 60 FR 61598, Nov. 30, 1995; 
62 FR 2614, Jan. 17, 1997]



227.7105  Contracts for the acquisition of existing works.



227.7105-1  General.

    (a) Existing works include motion pictures, television recordings, 
video recordings, and other audiovisual works in any medium; sound 
recordings in any medium; musical, dramatic, and literary works; 
pantomimes and choreographic works; pictorial, graphic, and sculptural 
works; and works of a similar nature. Usually, these or similar works 
were not first created, developed, generated, originated, prepared, or 
produced under a Government contract. Therefore, the Government must 
obtain a license in the work if it intends to reproduce the work, 
distribute copies of the work, prepare derivative works, or perform or 
display the work publicly. When the Government is not responsible for 
the content of an existing work, it should require the copyright owner 
to indemnify the Government for liabilities that may arise out of the 
content, performance, use, or disclosure of such data.
    (b) Follow the procedures at 227.7106 for works which will be first 
created, developed, generated, originated, prepared, or produced under a 
Government contract and the Government needs to control distribution of 
the work or has a specific need to obtain indemnity for liabilities that 
may arise out of the creation, content, performance, use, or disclosure 
of the work or from libelous or other unlawful material contained in the 
work. Follow the procedures at 227.7103 when the Government does not 
need to control distribution of such works or obtain such indemnities.



227.7105-2  Acquisition of existing works without modification

    (a) Use the clause at 252.227-7021, Rights in Data--Existing Works, 
in lieu of the clause at 252.227-7013, Rights in Technical Data--
Noncommercial Items, in solicitations and contracts exclusively for 
existing works when--
    (1) The existing works will be acquired without modification; and
    (2) The Government requires the right to reproduce, prepare 
derivative works, or publicly perform or display the existing works; or
    (3) The Government has a specific need to obtain indemnity for 
liabilities that may arise out of the content, performance, use, or 
disclosure of such data.
    (b) The clause at 252.227-7021 provides the Government, and others 
acting on its behalf, a paid-up, non-exclusive, irrevocable, world-wide 
license to reproduce, prepare derivative works and publicly perform or 
display the works called for by a contract and to authorize others to do 
so for government purposes.
    (c) A contract clause is not required to acquire existing works such 
as books, magazines and periodicals, in any storage or retrieval medium, 
when the Government will not reproduce the

[[Page 226]]

books, magazines or periodicals, or prepare derivative works.



227.7105-3  Acquisition of modified existing works.

    Use the clause at 252.227-7020, Rights in Special Works, in 
solicitations and contracts for modified existing works in lieu of the 
clause at 252.227-7021, Rights in Data--Existing Works.



227.7106  Contracts for special works.

    (a) Use the clause at 252.227-7020, Rights in Special Works, in 
solicitations and contracts where the Government has a specific need to 
control the distribution of works first produced, created, or generated 
in the performance of a contract and required to be delivered under that 
contract, including controlling distribution by obtaining an assignment 
of copyright, or a specific need to obtain indemnity for liabilities 
that may arise out of the creation, delivery, use, modification, 
reproduction, release, performance, display, or disclosure of such 
works. Use the clause--
    (1) In lieu of the clause at 252.227-7013, Rights in Technical 
Data--Noncommercial Items, when the Government must own or control 
copyright in all works first produced, created, or generated and 
required to be delivered under a contract; or
    (2) In addition to the clause at 252.227-7013 when the Government 
must own or control copyright in a portion of a work first produced, 
created, or generated and required to be delivered under a contract. The 
specific portion in which the Government must own or control copyright 
must be identified in a special contract requirement.
    (b) Although the Government obtains an assignment of copyright and 
unlimited rights in a special work under the clause at 252.227-7020, the 
contractor retains use and disclosure rights in that work. If the 
Government needs to restrict a contractor's rights to use or disclose a 
special work, it must also negotiate a special license which 
specifically restricts the contractor's use or disclosure rights.
    (c) The clause at 252.227-7020 does not permit a contractor to 
incorporate into a special work any works copyrighted by others unless 
the contractor obtains the contracting officer's permission to do so and 
obtains for the Government a non-exclusive, paid up, world-wide license 
to make and distribute copies of that work, to prepare derivative works, 
to perform or display publicly any portion of the work, and to permit 
others to do so for government purposes. Grant permission only when the 
Government's requirements cannot be satisfied unless the third party 
work is included in the deliverable work.
    (d) Examples of works which may be procured under the Rights in 
Special Works clause include, but are not limited, to audiovisual works, 
computer data bases, computer software documentation, scripts, 
soundtracks, musical compositions, and adaptations; histories of 
departments, agencies, services or units thereof; surveys of Government 
establishments; instructional works or guidance to Government officers 
and employees on the discharge of their official duties; reports, books, 
studies, surveys or similar documents; collections of data containing 
information pertaining to individuals that, if disclosed, would violate 
the right of privacy or publicity of the individuals to whom the 
information relates; or investigative reports.



227.7107  Contracts for architect-engineer services.

    This section sets forth policies and procedures, pertaining to data, 
copyrights, and restricted designs unique to the acquisition of 
construction and architect-engineer services.



227.7107-1  Architectural designs and data clauses for architect-engineer or construction contracts.

    (a) Except as provided in paragraph (b) of this subsection and in 
227.7107-2, use the clause at 252.227-7022, Government Rights 
(Unlimited), in solicitations and contracts for architect-engineer 
services and for construction involving architect-engineer services.
    (b) When the purpose of a contract for architect-engineer services, 
or for construction involving architect-engineer services, is to obtain 
a unique architectural design of a building, a monument, or construction 
of similar nature, which for artistic, aesthetic or other special 
reasons the Government

[[Page 227]]

does not want duplicated, the Government may acquire exclusive control 
of the data pertaining to the design by including the clause at 252.227-
7023, Drawings and Other Data to Become Property of Government, in 
solicitations and contracts.
    (c) The Government shall obtain unlimited rights in shop drawings 
for construction. In solicitations and contracts calling for delivery of 
shop drawings, include the clause at 252.227-7033, Rights in Shop 
Drawings.



227.7107-2  Contracts for construction supplies and research and development work.

    Use the provisions and clauses required by 227-7103-6 and 227.7203-6 
when the acquisition is limited to--
    (a) Construction supplies or materials;
    (b) Experimental, developmental, or research work, or test and 
evaluation studies of structures, equipment, processes, or materials for 
use in construction; or
    (c) Both.



227.7107-3  Approval of restricted designs.

    The clause at 252.227-7024, Notice and Approval of Restricted 
Designs, may be included in architect-engineer contracts to permit the 
Government to make informed decisions concerning noncompetitive aspects 
of the design.



227.7108  Contractor data repositories.

    (a) Contractor data repositories may be established when permitted 
by agency procedures. The contractual instrument establishing the data 
repository must require, as a minimum, the data repository management 
contractor to--
    (1) Establish and maintain adequate procedures for protecting 
technical data delivered to or stored at the repository from 
unauthorized release or disclosure;
    (2) Establish and maintain adequate procedures for controlling the 
release or disclosure of technical data from the repository to third 
parties consistent with the Government's rights in such data;
    (3) When required by the contracting officer, deliver data to the 
Government on paper or in other specified media;
    (4) Be responsible for maintaining the currency of data delivered 
directly by Government contractors or subcontractors to the repository;
    (5) Obtain use and non-disclosure agreements (see 227.7103-7) from 
all persons to whom government purpose rights data is released or 
disclosed; and
    (6) Indemnify the Government from any liability to data owners or 
licensors resulting from, or as a consequence of, a release or 
disclosure of technical data made by the data repository contractor or 
its officers, employees, agents, or representatives.
    (b) If the contractor is or will be the data repository manager, the 
contractor's data management and distribution responsibilities must be 
identified in the contract or the contract must reference the agreement 
between the Government and the contractor that establishes those 
responsibilities.
    (c) If the contractor is not and will not be the data repository 
manager, do not require a contractor or subcontractor to deliver 
technical data marked with limited rights legends to a data repository 
managed by another contractor unless the contractor or subcontractor who 
has asserted limited rights agrees to release the data to the repository 
or has authorized, in writing, the Government to do so.
    (d) Repository procedures may provide for the acceptance, delivery, 
and subsequent distribution of technical data in storage media other 
than paper, including direct electronic exchange of data between two 
computers. The procedures must provide for the identification of any 
portions of the data provided with restrictive legends, when 
appropriate. The acceptance criteria must be consistent with the 
authorized delivery format.



   Subpart 227.72--Rights in Computer Software and Computer Software 
                              Documentation

    Source:  60 FR 33482, June 28, 1995, unless otherwise noted.



227.7200  Scope of subpart.

    This subpart--

[[Page 228]]

    (a) Prescribes policies and procedures for the acquisition of 
computer software and computer software documentation, and the rights to 
use, modify, reproduce, release, perform, display, or disclose such 
software or documentation. It implements requirements in the following 
laws and Executive Order:
    (1) 10 U.S.C. 2302(4).
    (2) 10 U.S.C. 2305 (subsection (d)(4)).
    (3) 10 U.S.C. 2320.
    (4) 10 U.S.C. 2321.
    (5) 10 U.S.C. 2325.
    (6) Executive Order 12591 (subsection 1(b)(6)).
    (b) Does not apply to computer software or computer software 
documentation acquired under GSA schedule contracts.



227.7201  Definitions.

    (a) As used in this subpart, unless otherwise specifically 
indicated, the terms ``offeror'' and ``contractor'' include an offeror's 
or contractor's subcontractors, suppliers, or potential subcontractors 
or suppliers at any tier.
    (b) Other terms used in this subpart are defined in the clause at 
252.227-7014, Rights in Noncommercial Computer Software and 
Noncommercial Computer Software Documentation.



227.7202  Commercial computer software and commercial computer software documentation.



227.7202-1  Policy.

    (a) Commercial computer software or commercial computer software 
documentation shall be acquired under the licenses customarily provided 
to the public unless such licenses are inconsistent with Federal 
procurement law or do not otherwise satisfy user needs.
    (b) Commercial computer software and commercial computer software 
documentation shall be obtained competitively, to the maximum extent 
practicable, using firm-fixed-price contracts or firm-fixed-priced 
orders under available pricing schedules.
    (c) Offerors and contractors shall not be required to--
    (1) Furnish technical information related to commercial computer 
software or commercial computer software documentation that is not 
customarily provided to the public except for information documenting 
the specific modifications made at Government expense to such software 
or documentation to meet the requirements of a Government solicitation; 
or
    (2) Relinquish to, or otherwise provide, the Government rights to 
use, modify, reproduce, release, perform, display, or disclose 
commercial computer software or commercial computer software 
documentation except for a transfer of rights mutually agreed upon.



227.7202-2  [Reserved]



227.7202-3  Rights in commercial computer software or commercial computer software documentation.

    (a) The Government shall have only the rights specified in the 
license under which the commercial computer software or commercial 
computer software documentation was obtained.
    (b) If the Government has a need for rights not conveyed under the 
license customarily provided to the public, the Government must 
negotiate with the contractor to determine if there are acceptable terms 
for transferring such rights. The specific rights granted to the 
Government shall be enumerated in the contract license agreement or an 
addendum thereto.



227.7202-4  Contract clause.

    A specific contract clause governing the Government's rights in 
commercial computer software or commercial computer software 
documentation is not prescribed. As required by 227.7202-3, the 
Government's rights to use, modify, reproduce, release, perform, 
display, or disclose computer software or computer software 
documentation shall be identified in a license agreement.



227.7203  Noncommercial computer software and noncommercial computer software documentation.



227.7203-1  Policy.

    (a) DoD policy is to acquire only the computer software and computer 
software documentation, and the rights in such software or 
documentation, necessary to satisfy agency needs.
    (b) Solicitations and contracts shall--

[[Page 229]]

    (1) Specify the computer software or computer software documentation 
to be delivered under a contract and the delivery schedules for the 
software or documentation;
    (2) Establish or reference procedures for determining the 
acceptability of computer software or computer software documentation;
    (3) Establish separate contract line items, to the extent 
practicable, for the computer software or computer software 
documentation to be delivered under a contract and require offerors and 
contractors to price separately each deliverable data item; and
    (4) Require offerors to identify, to the extent practicable, 
computer software or computer software documentation to be furnished 
with restrictions on the Government's rights and require contractors to 
identify computer software or computer software documentation to be 
delivered with such restrictions prior to delivery.
    (c) Offerors shall not be required, either as a condition of being 
responsive to a solicitation or as a condition for award, to sell or 
otherwise relinquish to the Government any rights in computer software 
developed exclusively at private expense except for the software 
identified at 227.7203-5(a) (3) through (6).
    (d) Offerors and contractors shall not be prohibited or discouraged 
from furnishing or offering to furnish computer software developed 
exclusively at private expense solely because the Government's rights to 
use, modify, release, reproduce, perform, display, or disclose the 
software may be restricted.



227.7203-2  Acquisition of noncommercial computer software and computer software documentation.

    (a) Contracting officers shall work closely with data managers and 
requirements personnel to assure that computer software and computer 
software documentation requirements included in solicitations are 
consistent with the policy expressed in 227.7203-1.
    (b)(1) Data managers or other requirements personnel are responsible 
for identifying the Government's minimum needs. In addition to desired 
software performance, compatibility, or other technical considerations, 
needs determinations should consider such factors as multiple site or 
shared use requirements, whether the Government's software maintenance 
philosophy will require the right to modify or have third parties modify 
the software, and any special computer software documentation 
requirements.
    (2) When reviewing offers received in response to a solicitation or 
other request for computer software or computer software documentation, 
data managers must balance the original assessment of the Government's 
needs with prices offered.
    (c) Contracting officers are responsible for ensuring that, wherever 
practicable, solicitations and contracts--
    (1) Identify the types of computer software and the quantity of 
computer programs and computer software documentation to be delivered, 
any requirements for multiple users at one site or multiple site 
licenses, and the format and media in which the software or 
documentation will be delivered;
    (2) Establish each type of computer software or computer software 
documentation to be delivered as a separate contract line item (this 
requirement may be satisfied by an exhibit to the contract);
    (3) Identify the prices established for each separately priced 
deliverable item of computer software or computer software documentation 
under a fixed-price type contract;
    (4) Include delivery schedules and acceptance criteria for each 
deliverable item; and
    (5) Specifically identify the place of delivery for each deliverable 
item.



227.7203-3  Early identification of computer software or computer software documentation to be furnished to the Government with restrictions on use, 
          reproduction or disclosure.

    (a) Use the provision at 252.227-7017, Identification and Assertion 
of Use, Release, or Disclosure Restrictions, in all solicitation that 
include the clause at 252.227-7014, Rights in Noncommercial Computer 
Software and Noncommercial Computer Software Documentation. The 
provision requires offerors to identify any computer software or 
computer software documentation for

[[Page 230]]

which restrictions, other than copyright, on use, modification, 
reproduction, release, performance, display, or disclosure are asserted 
and to attach the identification and assertion to the offer.
    (b) Subsequent to contract award, the clause at 252.227-7014 permits 
a contractor, under certain conditions, to make additional assertions of 
restrictions. The prescriptions for the use of that clause and its 
alternates are at 227.7203-6(a).



227.7203-4  License rights.

    (a) Grant of license. The Government obtains rights in computer 
software or computer software documentation, including a copyright 
license, under an irrevocable license granted or obtained by the 
contractor which developed the software or documentation or the licensor 
of the software or documentation if the development contractor is not 
the licensor. The contractor or licensor retains all rights in the 
software or documentation not granted to the Government. The scope of a 
computer software license is generally determined by the source of funds 
used to develop the software. Contractors or licensors may, with some 
exceptions, restrict the Government's rights to use, modify, reproduce, 
release, perform, display, or disclose computer software developed 
exclusively or partially at private expense (see 227.7203-5 (b) and 
(c)). They may not, without the Government's agreement (see 227.7203-
5(d)), restrict the Government's rights in computer software developed 
exclusively with Government funds or in computer software documentation 
required to be delivered under a contract.
    (b) Source of funds determination. The determination of the source 
of funds used to develop computer software should be made at the lowest 
practicable segregable portion of the software or documentation (e.g., a 
software sub-routine that performs a specific function). Contractors may 
assert restricted rights in a segregable portion of computer software 
which otherwise qualifies for restricted rights under the clause at 
252.227-7014, Rights in Noncommercial Computer Software and 
Noncommercial Computer Software Documentation.



227.7203-5  Government rights.

    The standard license rights in computer software that a licensor 
grants to the Government are unlimited rights, government purpose 
rights, or restricted rights. The standard license in computer software 
documentation conveys unlimited rights. Those rights are defined in the 
clause at 252.227-7014, Rights in Noncommercial Computer Software and 
Noncommercial Computer Software Documentation. In unusual situations, 
the standard rights may not satisfy the Government's needs or the 
Government may be willing to accept lesser rights in return for other 
consideration. In those cases, a special license may be negotiated. 
However, the licensor is not obligated to provide the Government greater 
rights and the contracting officer is not required to accept lesser 
rights than the rights provided in the standard grant of license. The 
situations under which a particular grant of license applies are 
enumerated in paragraphs (a) through (d) of this subsection.
    (a) Unlimited rights. The Government obtains an unlimited rights 
license in--
    (1) Computer software developed exclusively with Government funds;
    (2) Computer software documentation required to be delivered under a 
Government contract;
    (3) Corrections or changes to computer software or computer software 
documentation furnished to the contractor by the Government;
    (4) Computer software or computer software documentation that is 
otherwise publicly available or has been released or disclosed by the 
contractor or subcontractor without restrictions on further use, release 
or disclosure other than a release or disclosure resulting from the 
sale, transfer, or other assignment of interest in the software to 
another party or the sale or transfer of some or all of a business 
entity or it assets to another party;
    (5) Computer software or computer software documentation obtained 
with unlimited rights under another Government contract or as a result 
of negotiations; or
    (6) Computer software or computer software documentation furnished 
to

[[Page 231]]

the Government, under a Government contract or subcontract with--
    (i) Restricted rights in computer software, limited rights in 
technical data, or government purpose license rights and the restrictive 
conditions have expired; or
    (ii) Government purpose rights and the contractor's exclusive right 
to use such software or documentation for commercial purposes has 
expired.
    (b) Government purpose rights. (1) Except as provided in paragraph 
(a) of this subsection, the Government obtains government purpose rights 
in computer software developed with mixed funding.
    (2) The period during which government purpose rights are effective 
is negotiable. The clause at 252.227-7014 provides a nominal five-year 
period. Either party may request a different period. Changes to the 
government purpose rights period may be made at any time prior to 
delivery of the software without consideration from either party. Longer 
periods should be negotiated when a five-year period does not provide 
sufficient time to commercialize the software or, for software developed 
by subcontractors, when necessary to recognize the subcontractors' 
interests in the software.
    (3) The government purpose rights period commences upon execution of 
the contract, subcontract, letter contract (or similar contractual 
instrument), contract modification, or option exercise that required 
development of the computer software. Upon expiration of the government 
purpose rights period, the Government has unlimited rights in the 
software including the right to authorize others to use data for 
commercial purposes.
    (4) During the government purpose rights period, the Government may 
not use, or authorize other persons to use, computer software marked 
with government purpose rights legends for commercial purposes. The 
Government shall not release or disclose, or authorize others to release 
or disclose, computer software in which it has government purpose rights 
to any person unless--
    (i) Prior to release or disclosure, the intended recipient is 
subject to the use and non-disclosure agreement at 227.7103-7; or
    (ii) The intended recipient is a Government contractor receiving 
access to the software for performance of a Government contract that 
contains the clause at 252.227-7025, Limitations on the Use or 
Disclosure of Government-Furnished Information Marked with Restrictive 
Legends.
    (5) When computer software marked with government purpose rights 
legends will be released or disclosed to a Government contractor 
performing a contract that does not include the clause at 252.227-7025, 
the contract may be modified, prior to release or disclosure, to include 
such clause in lieu of requiring the contractor to complete a use and 
non-disclosure agreement.
    (6) Contracting activities shall establish procedures to assure that 
computer software or computer software documentation marked with 
government purpose rights legends are released or disclosed, including a 
release or disclosure through a Government solicitation, only to persons 
subject to the use and non-disclosure restrictions. Public announcements 
in the Commerce Business Daily or other publications must provide notice 
of the use and non-disclosure requirements. Class use and non-disclosure 
agreements (e.g., agreements covering all solicitations received by the 
XYZ company within a reasonable period) are authorized and may be 
obtained at any time prior to release or disclosure of the government 
purpose rights software or documentation. Documents transmitting 
government purpose rights software or documentation to persons under 
class agreements shall identify the specific software or documentation 
subject to government purpose rights and the class agreement under which 
such software or documentation are provided.
    (c) Restricted rights. (1) The Government obtains restricted rights 
in noncommercial computer software required to be delivered or otherwise 
provided to the Government under a contract that were developed 
exclusively at private expense.
    (2) Contractors are not required to provide the Government 
additional rights in computer software delivered

[[Page 232]]

or otherwise provided to the Government with restricted rights. When the 
Government has a need for additional rights, the Government must 
negotiate with the contractor to determine if there are acceptable terms 
for transferring such rights. List or describe all software in which the 
contractor has granted the Government additional rights in a license 
agreement made part of the contract (see paragraph (d) of this 
subsection). The license shall enumerate the specific additional rights 
granted to the Government.
    (d) Specifically negotiated license rights. Negotiate specific 
licenses when the parties agree to modify the standard license rights 
granted to the Government or when the Government wants to obtain rights 
in computer software in which it does not have rights. When negotiating 
to obtain, relinquish, or increase the Government's rights in computer 
software, consider the planned software maintenance philosophy, 
anticipated time or user sharing requirements, and other factors which 
may have relevance for a particular procurement. If negotiating to 
relinquish rights in computer software documentation, consider the 
administrative burden associated with protecting documentation subject 
to restrictions from unauthorized release or disclosure. The negotiated 
license rights must stipulate the rights granted the Government to use, 
modify, reproduce, release, perform, display, or disclose the software 
or documentation and the extent to which the Government may authorize 
others to do so. Identify all negotiated rights in a license agreement 
made part of the contract.
    (e) Rights in derivative computer software or computer software 
documentation. The clause at 252.227-7014 protects the Government's 
rights in computer software, computer software documentation, or 
portions thereof that the contractor subsequently uses to prepare 
derivative software or subsequently embeds or includes in other software 
or documentation. The Government retains the rights it obtained under 
the development contract in the unmodified portions of the derivative 
software or documentation.



227.7203-6  Contract clauses.

    (a)(1) use the clause at 252.227-7014, Rights in Noncommercial 
Computer Software and Noncommercial Computer Software Documentation, in 
solicitations and contracts when the successful offeror(s) will be 
required to deliver computer software or computer software 
documentation. Do not use the clause when the only deliverable items are 
technical data (other than computer software documentation), commercial 
computer software or commercial computer software documentation, 
commercial items (see 227.7102-3), special works (see 227.7205), or 
contracts under the Small Business Innovative Research Program (see 
227.7104), Except as provided in 227.7107-2, do not use the clause in 
architect-engineer and construction contracts..
    (2) Use the clause at 252.227-7014 with its Alternate I in research 
contracts when the contracting officer determines, in consultation with 
counsel, that public dissemination by the contractor would be--
    (i) In the interest of the Government; and
    (ii) Facilitated by the Government relinquishing its right to 
publish the work for sale, or to have others publish the work for sale 
on behalf of the Government.
    (b) Use the clause at 252.227-7016, Rights in Bid or Proposal 
Information, in solicitations and contracts that include the clause at 
252.227-7014.
    (c) Use the clause at 252.227-7019, Validation of Asserted 
Restrictions--Computer Software, in solicitations and contracts that 
include the clause at 252.227-7014. The clause provides procedures for 
the validation of asserted restrictions on the Government's rights to 
use, release, or disclose computer software.
    (d) Use the provision at 252.227-7025, Limitations on the Use or 
Disclosure of Government-Furnished Information Marked with Restrictive 
Legends, in solicitations and contracts when it is anticipated that the 
Government will provide the contractor, for performance of its contract, 
computer software or computer software documentation marked with another 
contractor's restrictive legend(s).

[[Page 233]]

    (e) Use the provision at 252.227-7028, Technical Data or Computer 
Software Previously Delivered to the Government, in solicitations when 
the resulting contract will require the contractor to deliver computer 
software or computer software documentation. The provision requires 
offerors to identify any software or documentation specified in the 
solicitation as deliverable items that are the same or substantially the 
same as software or documentation which the offeror has delivered or is 
obligated to deliver, either as a contractor or subcontractor, under any 
other federal agency contract.
    (f) Use the clause at 252.227-7037, Validation of Restrictive 
Markings on Technical Data, in solicitations and contracts that include 
the clause at 252.227-7014 when the contractor will be required to 
deliver noncommercial computer software documentation (technical data). 
The clause implements statutory requirements under 10 U.S.C. 2321. 
Paragraph (e) of the clause contains information that must be included 
in a formal challenge.



227.7203-7  [Reserved]



227.7203-8  Deferred delivery and deferred ordering of computer software and computer software documentation.

    (a) Deferred delivery. Use the clause at 252.227-7026, Deferred 
Delivery of Technical Data or Computer Software, when it is in the 
Government's interests to defer the delivery of computer software or 
computer software documentation. The clause permits the contracting 
officer to require the delivery of data identified as ``deferred 
delivery'' data or computer software at any time until two years after 
acceptance by the Government of all items (other than technical data or 
computer software) under the contract or contract termination, whichever 
is later. The obligation of subcontractors or suppliers to deliver such 
data expires two years after the date the prime contractor accepts the 
last item from the subcontractor or supplier for use in the performance 
of the contract. The contract must specify the computer software or 
computer software documentation that is subject to deferred delivery. 
The contracting officer shall notify the contractor sufficiently in 
advance of the desired delivery date for such software or documentation 
to permit timely delivery.
    (b) Deferred ordering. Use the clause at 252.227-7027, Deferred 
Ordering of Technical Data or Computer Software, when a firm requirement 
for software or documentation has not been established prior to contract 
award but there is a potential need for computer software or computer 
software documentation. Under this clause the contracting officer may 
order any computer software or computer software documentation generated 
in the performance of the contract or any subcontract thereunder at any 
time until three years after acceptance of all items (other than 
technical data or computer software) under the contract or contract 
termination, whichever is later. The obligation of subcontractors to 
deliver such technical data or computer software expires three years 
after the date the contractor accepts the last item under the 
subcontract. When the software or documentation are ordered, the 
delivery dates shall be negotiated and the contractor compensated only 
for converting the software or documentation into the prescribed form, 
reproduction costs, and delivery costs.



227.7203-9  Copyright.

    (a) Copyright license. (1) The clause at 252.227-7014, Rights in 
Noncommercial Computer Software and Noncommercial Computer Software 
Documentation, requires a contractor to grant, or obtain for the 
Government license rights which permit the Government to reproduce the 
software or documentation, distribute copies, perform or display the 
software or documentation and, through the right to modify data, prepare 
derivative works. The extent to which the Government, and others acting 
on its behalf, may exercise these rights varies for each of the standard 
data rights licenses obtained under the clause. When non-standard 
license rights in computer software or computer software documentation 
will be negotiated, negotiate the extent of the copyright license 
concurrent with negotiations for the data rights license. Do not 
negotiate copyright licenses for computer software that provide less

[[Page 234]]

rights than the standard restricted rights in computer software license. 
For computer software documentation, do not negotiate a copyright 
license that provides less rights than the standard limited rights in 
technical data license.
    (2) The clause at 252.227-7013, Rights in Technical Data--
Noncommercial Items, does not permit a contractor to incorporate a third 
party's copyrighted software into a deliverable software item unless the 
contractor has obtained an appropriate license for the Government and, 
when applicable, others acting on the Government's behalf, or has 
obtained the contracting officer's written approval to do so. Grant 
approval to use third party copyrighted software in which the Government 
will not receive a copyright license only when the Government's 
requirements cannot be satisfied without the third party material or 
when the use of the third party material will result in cost savings to 
the Government which outweigh the lack of a copyright license.
    (b) Copyright considerations--special works. See 227.7205 for 
copyright considerations when acquiring special works.



227.7203-10  Contractor identification and marking of computer software or computer software documentation to be furnished with restrictive markings.

    (a) Identification requirements. (1) The solicitation provision at 
252.227-7017, Identification and Assertion of Use, Release, or 
Disclosure Restrictions, requires offerors to identify, prior to 
contract award, any computer software or computer software documentation 
that an offeror asserts should be provided to the Government with 
restrictions on use, modification, reproduction, release or disclosure. 
This requirement does not apply to restrictions based solely on 
copyright. The notification and identification must be submitted as an 
attachment to the offer. If an offeror fails to submit the attachment or 
fails to complete the attachment in accordance with the requirements of 
the solicitation provision, such failure shall constitute a minor 
informality. Provide offerors an opportunity to remedy a minor 
informality in accordance with the procedures at FAR 14.405 or 15.607. 
An offeror's failure to correct an informality within the time 
prescribed by the contracting officer shall render the offer ineligible 
for award.
    (2) The procedures for correcting minor informalities shall not be 
used to obtain information regarding asserted restrictions or an 
offeror's suggested asserted rights category. Questions regarding the 
justification for an asserted restriction or asserted rights category 
must be pursued in accordance with the procedures at 227.7203-13.
    (3) The restrictions asserted by a successful offeror shall be 
attached to its contract unless, in accordance with the procedures at 
227.7203-13, the parties have agreed that an asserted restriction is not 
justified. The contract attachment shall provide the same information 
regarding identification of the computer software or computer software 
documentation, the asserted rights category, the basis for the 
assertion, and the name of the person asserting the restrictions as 
required by paragraph (d) of the solicitation provision at 252.227-7017. 
Subsequent to contract award, the clause at 252.227-7014, Rights in 
Noncommercial Computer Software and Noncommercial Computer Software 
Documentation, permits a contractor to make additional assertions under 
certain conditions. The additional assertions must be made in accordance 
with the procedures and in the format prescribed by that clause.
    (4) Neither the pre- or post-award assertions made by the contractor 
nor the fact that certain assertions are identified in the attachment to 
the contract, determine the respective rights of the parties. As 
provided at 227.7203-13, the Government has the right to review, verify, 
challenge and validate restrictive markings.
    (5) Information provided by offerors in response to the solicitation 
provision at 252.227-7017 may be used in the source selection process to 
evaluate the impact on evaluation factors that may be created by 
restrictions on the Government's ability to use or disclose computer 
software or computer software documentation.
    (b) Contractor marking requirements. The clause at 252.227-7014, 
Rights in Noncommercial Computer Software

[[Page 235]]

and Noncommercial Computer Software Documentation--
    (1) Requires a contractor who desires to restrict the Government's 
rights in computer software or computer software documentation to place 
restrictive markings on the software or documentation, provides 
instructions for the placement of the restrictive markings, and 
authorizes the use of certain restrictive markings. When it is 
anticipated that the software will or may be used in combat or 
situations which simulate combat conditions, do not permit contractors 
to insert instructions into computer programs that interfere with or 
delay operation of the software to display a restrictive rights legend 
or other license notice; and
    (2) Requires a contractor to deliver, furnish, or otherwise provide 
to the Government any computer software or computer software 
documentation in which the Government has previously obtained rights 
with the Government's pre-existing rights in that software or 
documentation unless the parties have agreed otherwise or restrictions 
on the Government's rights to use, modify, produce, release, or disclose 
the software or documentation have expired. When restrictions are still 
applicable, the contractor is permitted to mark the software or 
documentation with the appropriate restrictive legend.
    (c) Unmarked computer software or computer software documentation. 
(1) Computer software or computer software documentation delivered or 
otherwise provided under a contract without restrictive markings shall 
be presumed to have been delivered with unlimited rights and may be 
released or disclosed without restriction. To the extent practicable, if 
a contractor has requested permission (see paragraph (c)(2) of this 
subsection) to correct an inadvertent omission of markings, do not 
release or disclose the software or documentation pending evaluation of 
the request.
    (2) A contractor may request permission to have appropriate legends 
placed on unmarked computer software or computer software documentation 
at its expense. The request must be received by the contracting officer 
within six months following the furnishing or delivery of such software 
or documentation, or any extension of that time approved by the 
contracting officer. The person making the request must--
    (i) Identify the software or documentation that should have been 
marked;
    (ii) Demonstrate that the omission of the marking was inadvertent, 
the proposed marking is justified and conforms with the requirements for 
the marking of computer software or computer software documentation 
contained in the clause at 252.227-7014; and
    (iii) Acknowledge, in writing, that the Government has no liability 
with respect to any disclosure, reproduction, or use of the software or 
documentation made prior to the addition of the marking or resulting 
from the omission of the marking.
    (3) Contracting officers should grant permission to mark only if the 
software or documentation were not distributed outside the Government or 
were distributed outside the Government with restrictions on further use 
or disclosure.



227.7203-11  Contractor procedures and records.

    (a) The clause at 252.227-7014, Rights in Noncommercial Computer 
Software and Noncommercial Computer Software Documentation, requires a 
contractor, and its subcontractors or suppliers that will deliver 
computer software or computer software documentation with other than 
unlimited rights, to establish and follow written procedures to assure 
that restrictive markings are used only when authorized and to maintain 
records to justify the validity of restrictive markings.
    (b) The clause at 252.227-7019, Validation of Asserted 
Restrictions--Computer Software, requires contractors and their 
subcontractors or suppliers at any tier to maintain records sufficient 
to justify the validity of markings that assert restrictions on the use, 
modification, reproduction, release, performance, display, or disclosure 
of computer software.



227.7203-12  Government right to establish conformity of markings.

    (a) Nonconforming markings. (1) Authorized markings are identified 
in the

[[Page 236]]

clause at 252.227-7014, Rights in Noncommercial Computer Software and 
Noncommercial Computer Software Documentation. All other markings are 
nonconforming markings. An authorized marking that is not in the form, 
or differs in substance, from the marking requirements in the clause at 
252.227-7014 is also a nonconforming marking.
    (2) The correction of nonconforming markings on computer software is 
not subject to 252.227-7019, Validation of Asserted Restrictions--
Computer Software, and the correction of nonconforming markings on 
computer software documentation (technical data) is not subject to 
252.227-7037, Validation of Restrictive Markings on Technical Data. To 
the extent practicable, the contracting officer should return computer 
software or computer software documentation bearing nonconforming 
markings to the person who has placed the nonconforming markings on the 
software or documentation to provide that person an opportunity to 
correct or strike the nonconforming markings at that person's expense. 
If that person fails to correct the nonconformity and return the 
corrected software or documentation within 60 days following the 
person's receipt of the software or documentation, the contracting 
officer may correct or strike the nonconformity at the person's expense. 
When it is impracticable to return computer software or computer 
software documentation for correction, contracting officers may 
unilaterally correct any nonconforming markings at Government expense. 
Prior to correction, the software or documentation may be used in 
accordance with the proper restrictive marking.
    (b) Unjustified markings. (1) An unjustified marking is an 
authorized marking that does not depict accurately restrictions 
applicable to the Government's use, modification, reproduction, release, 
or disclosure of the marked computer software or computer software 
documentation. For example, a restricted rights legend placed on 
computer software developed under a Government contract either 
exclusively at Government expense or with mixed funding (situations 
under which the Government obtains unlimited or government purpose 
rights) is an unjustified marking.
    (2) Contracting officers have the right to review and challenge the 
validity of unjustified markings. However, at any time during 
performance of a contract and notwithstanding existence of a challenge, 
the contracting officer and the person who has asserted a restrictive 
marking may agree that the restrictive marking is not justified. Upon 
such agreement, the contracting officer may, at his or her election, 
either----
    (i) Strike or correct the unjustified marking at that person's 
expense; or
    (ii) Return the computer software or computer software documentation 
to the person asserting the restriction for correction at that person's 
expense. If the software or documentation are returned and that person 
fails to correct or strike the unjustified restriction and return the 
corrected software or documentation to the contracting officer within 60 
days following receipt of the software or documentation, the unjustified 
marking shall be corrected or stricken at that person's expense.



227.7203-13  Government right to review, verify, challenge and validate asserted restrictions.

    (a) General. An offeror's or contractor's assertion(s) of 
restrictions on the Government's rights to use, modify, reproduce, 
release, or disclose computer software or computer software 
documentation do not, by themselves, determine the extent of the 
Government's rights in such software or documentation. The Government 
may require an offeror or contractor to submit sufficient information to 
permit an evaluation of a particular asserted restriction and may 
challenge asserted restrictions when there are reasonable grounds to 
believe that an assertion is not valid.
    (b) Requests for information. Contracting officers should have a 
reason to suspect that an asserted restriction might not be correct 
prior to requesting information. When requesting information, provide 
the offeror or contractor the reason(s) for suspecting that an asserted 
restriction might not

[[Page 237]]

be correct. A need for additional license rights is not, by itself, a 
sufficient basis for requesting information concerning an asserted 
restriction. Follow the procedures at 227.7203-5(d) when additional 
license rights are needed but there is no basis to suspect that an 
asserted restriction might not be valid.
    (c) Transacting matters directly with subcontractors. The clause at 
252.227-7019, Validation of Asserted Restrictions--Computer Software, 
obtains the contractor's agreement that the Government may transact 
matters under the clause directly with a subcontractor or supplier, at 
any tier, without creating or implying privity of contract. Contracting 
officers should permit a subcontractor or supplier to transact challenge 
and validation matters directly with the Government when--
    (1) A subcontractor's or supplier's business interests in its 
technical data would be compromised if the data were disclosed to a 
higher tier contractor.
    (2) There is reason to believe that the contractor will not respond 
in a timely manner to a challenge and an untimely response would 
jeopardize a subcontractor's or supplier's right to assert restrictions; 
or
    (3) Requested to do so by a subcontractor or supplier.
    (d) Challenging asserted restrictions--(1) Pre-award considerations. 
The challenge procedures in the clause at 252.227-7019 could 
significantly delay competitive procurements. Therefore, avoid 
challenging asserted restrictions prior to a competitive contract award 
unless resolution of the assertion is essential for successful 
completion of the procurement.
    (2) Computer software documentation. Computer software documentation 
is technical data. Challenges to asserted restrictions on the 
Government's rights to use, modify, reproduce, release, perform, 
display, or disclose computer software documentation must be made in 
accordance with the clause at 252.227-7037, Validation of Restrictive 
Markings on Technical Data, and the guidance at 227.7103-13. The 
procedures in the clause at 252.227-7037 implement requirements 
contained in 10 U.S.C. 2321. Resolution of questions regarding the 
validity of asserted restrictions using the process described at 
227.7103-12(b)(2) is strongly encouraged.
    (3) Computer software. (i) Asserted restrictions should be reviewed 
before acceptance of the computer software deliverable under a contract. 
The Government's right to challenge an assertion expires three years 
after final payment under the contract or three years after delivery of 
the software, whichever is later. Those limitations on the Government's 
challenge rights do not apply to software that is publicly available, 
has been furnished to the Government without restrictions, or has been 
otherwise made available without restrictions.
    (ii) Contracting officers must have reasonable grounds to challenge 
the current validity of an asserted restriction. Before challenging an 
asserted restriction, carefully consider all available information 
pertaining to the asserted restrictions. Resolution of questions 
regarding the validity of asserted restrictions using the process 
described at 227.7203-12(b)(2) is strongly encouraged. After 
consideration of the situations described in paragraph (c) of this 
subsection, contracting officers may request the person asserting a 
restriction to furnish a written explanation of the facts and supporting 
documentation for the assertion in sufficient detail to enable the 
contracting officer to determine the validity of the assertion. 
Additional supporting documentation may be requested when the 
explanation provided by that person does not, in the contracting 
officer's opinion, establish the validity of the assertion.
    (iii) Assertions may be challenged whether or not supporting 
documentation was requested. Challenges must be in writing and issued to 
the person asserting the restriction.
    (4) Extension of response time. The contracting officer, at his or 
her discretion, may extend the time for response contained in a 
challenge, as appropriate, if the contractor submits a timely written 
request showing the need for additional time to prepare a response.
    (e) Validating or denying asserted restrictions. (1) Contracting 
officers must promptly issue a final decision denying

[[Page 238]]

or sustaining the validity of each challenged assertion unless the 
parties have agreed on the disposition of the assertion. When a final 
decision denying the validity of an asserted restriction is made 
following a timely response to a challenge, the Government is obligated 
to continue to respect the asserted restrictions through final 
disposition of any appeal unless the agency head notifies the person 
asserting the restriction that urgent or compelling circumstances do not 
permit the Government to continue to respect the asserted restriction. 
See 252.227-7019(g) for restrictions applicable following a 
determination of urgent and compelling circumstances.
    (2) Only a contracting officer's final decision, or actions of an 
agency Board of Contract Appeals or a court of competent jurisdiction, 
that sustain the validity of an asserted restriction constitute 
validation of the restriction.
    (f) Multiple challenges to an asserted restriction. When more than 
one contracting officer challenges an asserted restriction, the 
contracting officer who made the earliest challenge is responsible for 
coordinating the Government challenges. That contracting officer shall 
consult with all other contracting officers making challenges, verify 
that all challenges apply to the same asserted restriction and, after 
consulting with the contractor, subcontractor, or supplier asserting the 
restriction, issue a schedule that provides that person a reasonable 
opportunity to respond to each challenge.



227.7203-14  Conformity, acceptance, and warranty of computer software and computer software documentation.

    (a) Computer software documentation. Computer software documentation 
is technical data. See 227.7103-14 for appropriate guidance and 
statutory requirements.
    (b) Computer software. (1) Conformity and acceptance. Solicitations 
and contracts requiring the delivery of computer software shall specify 
the requirements the software must satisfy to be acceptable. Contracting 
officers, or their authorized representatives, are responsible for 
determining whether computer software tendered for acceptance conforms 
to the contractual requirements. Except for nonconforming restrictive 
markings (follow the procedures at 227.7203-12(a) if nonconforming 
markings are the sole reason computer software tendered for acceptance 
fails to conform to contractual requirements), do not accept software 
that does not conform in all respects to applicable contractual 
requirements. Correction or replacement of nonconforming software, or an 
equitable reduction in contract price when correction or replacement of 
the nonconforming data is not practicable or is not in the Government's 
interests, shall be accomplished in accordance with--
    (i) The provisions of a contract clause providing for inspection and 
acceptance of deliverables and remedies for nonconforming deliverables; 
or
    (ii) The procedures at FAR 46.407(c) through (g), if the contract 
does not contain an inspection clause providing remedies for 
nonconforming deliverables.
    (2) Warranties--(i) Weapon systems. Computer software that is a 
component of a weapon system or major subsystem should be warranted as 
part of the weapon system warranty. Follow the procedures at 246.770.
    (ii) Non-weapon systems. Approval of the chief of the contracting 
office must be obtained to use a computer software warranty other than a 
weapon system warranty. Consider the factors at FAR 46.703 in deciding 
whether to obtain a computer software warranty. When approval for a 
warranty has been obtained, the clause at 252.246-7001, Warranty of 
Data, and its alternates, may be appropriately modified for use with 
computer software or a procurement specific clause may be developed.



227.7203-15  Subcontractor rights in computer software or computer software documentation.

    (a) Subcontractors and suppliers at all tiers should be provided the 
same protection for their rights in computer software or computer 
software documentation as are provided to prime contractors.
    (b) The clauses at 252.227-7019, Validation of Asserted 
Restrictions--Computer Software, and 252.227-7037, Validation of 
Restrictive Markings on

[[Page 239]]

Technical Data, obtain a contractor's agreement that the Government's 
transaction of validation or challenge matters directly with 
subcontractors at any tier does not establish or imply privity of 
contract. When a subcontractor or supplier exercises its right to 
transact validation matters directly with the Government, contracting 
officers shall deal directly with such persons, as provided at 227.7203-
13(c) for computer software and 227.7103-13(c)(3) for computer software 
documentation (technical data).
    (c) Require prime contractors whose contracts include the following 
clauses to include those clauses, without modification except for 
appropriate identification of the parties, in contracts with 
subcontractors or suppliers who will be furnishing computer software in 
response to a Government requirement (see 227.7103-15(c) for clauses 
required when subcontractors or suppliers will be furnishing computer 
software documentation (technical data)):
    (1) 252.227.7014, Rights in Noncommercial Computer Software and 
Noncommercial Computer Software Documentation;
    (2) 252.227.7019, Validation of Asserted Restrictions--Computer 
Software;
    (3) 252.227.7025, Limitations on the Use or Disclosure of Government 
Furnished Information Marked with Restrictive Legends; and
    (4) 252.227.7028, Technical Data or Computer Software Previously 
Delivered to the Government.
    (d) Do not require contractors to have their subcontractors or 
suppliers at any tier relinquish rights in technical data to the 
contractor, a higher tier subcontractor, or to the Government, as a 
condition for award of any contract, subcontract, purchase order, or 
similar instrument except for the rights obtained by the Government 
under the provisions of the Rights in Noncommercial Computer Software 
and Noncommercial Computer Software Documentation clause contained in 
the contractor's contract with the Government.



227.7203-16  Providing computer software or computer software documentation to foreign governments, foreign contractors, or international organizations.

    Computer software or computer software documentation may be released 
or disclosed to foreign governments, foreign contractors, or 
international organizations only if release or disclosure is otherwise 
permitted both by Federal export controls and other national security 
laws or regulations. Subject to such laws and regulations, the 
Department of Defense--
    (a) May release or disclose computer software or computer software 
documentation in which it has obtained unlimited rights to such foreign 
entities or authorize the use of such data by those entities; and
    (b) Shall not release or disclose computer software or computer 
software documentation for which restrictions on use, release, or 
disclosure have been asserted to such foreign entities or authorize the 
use of such data by those entities, unless the intended recipient is 
subject to the same provisions as included in the use and non-disclosure 
agreement at 227.7103-7 and the requirements of the clause at 252.227-
7014, Rights in Noncommercial Computer Software and Noncommercial 
Computer Software Documentation, governing use, modification, 
reproduction, release, performance, display, or disclosure of such data 
have been satisfied.



227.7203-17  Overseas contracts with foreign sources.

    (a) The clause at 252.227-7032, Rights in Technical Data and 
Computer Software (Foreign), may be used in contracts with foreign 
contractors to be performed overseas, except Canadian purchases (see 
paragraph (c) of this subsection) in lieu of the clause at 252.227-7014, 
Rights in Noncommercial Computer Software and Noncommercial Computer 
Software Documentation, when the Government requires the unrestricted 
right to use, modify, reproduce, release, perform, display, or

[[Page 240]]

disclose all computer software or computer software documentation to be 
delivered under the contract. Do not use the clause in contracts for 
special works.
    (b) When the Government does not require unlimited rights, the 
clause at 252.227-7032 may be modified to accommodate the needs of a 
specific overseas procurement situation. The Government should obtain 
rights to the computer software or computer software documentation that 
are not less than the rights the Government would have obtained under 
the software rights clause(s) prescribed in this part for a comparable 
procurement performed within the United States or its possessions.
    (c) Contracts for Canadian purchases shall include the appropriate 
software rights clause prescribed in this part for a comparable 
procurement performed within the United States or its possessions.



227.7204  Contracts under the Small Business Innovative Research Program.

    When contracting under the Small Business Innovative Research 
Program, follow the procedures at 227-7104.



227.7205  Contracts for special works.

    (a) Use the clause at 252.227-7020, Rights in Special Works, in 
solicitations and contracts where the Government has a specific need to 
control the distribution of computer software or computer software 
documentation first produced, created, or generated in the performance 
of a contract and required to be delivered under that contract, 
including controlling distribution by obtaining an assignment of 
copyright, or a specific need to obtain indemnity for liabilities that 
may arise out of the creation, delivery, use, modification, 
reproduction, release, performance, display, or disclosure of such 
software or documentation. Use the clause--

    (1) In lieu of the clause at 252.227-7014, Rights in Noncommercial 
Computer Software and Noncommercial Computer Software Documentation, 
when the Government must own or control copyright in all computer 
software or computer software documentation first produced, created, or 
generated and required to be delivered under a contract; or

    (2) In addition to the clause at 252.227-7014 when the Government 
must own or control copyright in some of the computer software or 
computer software documentation first produced, created, or generated 
and required to be delivered under a contract. The specific software or 
documentation in which the Government must own or control copyright must 
be identified in a special contract requirement.

    (b) Although the Government obtains an assignment of copyright and 
unlimited rights in the computer software or computer software 
documentation delivered as a special work under the clause at 252.227-
7020, the contractor retains use and disclosure rights in that software 
or documentation. If the Government needs to restrict a contractor's 
rights to use or disclose a special work, it must also negotiate a 
special license which specifically restricts the contractor's use or 
disclosure rights.

    (c) The clause at 252.227-7020 does not permit a contractor to 
incorporate into a special work any work copyrighted by others unless 
the contractor obtains the contracting officer's permission to do so and 
obtains for the Government a non-exclusive, paid up, world-wide license 
to make and distribute copies of that work, to prepare derivative works, 
to perform or display any portion of that work, and to permit others to 
do so for government purposes. Grant permission only when the 
Government's requirements cannot be satisfied unless the third party 
work is included in the deliverable work.
    (d) Examples of other works which may be procured under the clause 
at 252.227-7020 include, but are not limited to, audiovisual works, 
scripts, soundtracks, musical compositions, and adaptations; histories 
of departments, agencies, services or units thereof; surveys of 
Government establishments; instructional works or guidance to Government 
officers and employees on the discharge of their official duties; 
reports, books, studies, surveys or similar documents; collections of 
data containing information pertaining to individuals that, if 
disclosed, would violate the right of privacy or publicity of the

[[Page 241]]

individuals to whom the information relates; or investigative reports.



227.7206  Contracts for architect-engineer services.

    Follow 227.7107 when contracting for architect-engineer services.



227.7207  Contractor data repositories.

    Follow 227.7108 when it is in the Government's interests to have a 
data repository include computer software or to have a separate computer 
software repository. Contractual instruments establishing the repository 
requirements must appropriately reflect the repository manager's 
software responsibilities.



PART 228--BONDS AND INSURANCE--Table of Contents




Sec.

                          Subpart 228.1--Bonds

228.102  Performance and payment bonds for construction contracts.
228.102-1  General.
228.105  Other types of bonds.
228.106  Administration.
228.106-7  Withholding contract payments.
228.170  Solicitation provision.

                        Subpart 228.3--Insurance

228.304  Risk-pooling arrangements.
228.305  Overseas workers' compensation and war-hazard insurance.
228.307  Insurance under cost-reimbursement contracts.
228.307-1  Group insurance plans.
228.311  Solicitation provision and contract clause on liability 
          insurance under cost-reimbursement contracts.
228.311-1  Contract clause.
228.370  Additional clauses.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36404, July 31, 1991, unless otherwise noted.



                          Subpart 228.1--Bonds



228.102  Performance and payment bonds for construction contracts.



228.102-1  General.

    For Defense Environmental Restoration Program construction contracts 
entered into pursuant to 10 U.S.C. 2701 and executed between December 5, 
1991, and December 31, 1999--
    (1) Any rights of action under the performance bond shall only 
accrue to, and be for the exclusive use of, the obligee named in the 
bond.
    (2) In the event of default, the surety's liability on the 
performance bond is limited to the cost of completion of the contract 
work, less the balance of unexpended funds. Under no circumstances shall 
the liability exceed the penal sum of the bond.
    (3) The surety shall not be liable for indemnification or 
compensation of the obligee for loss or liability arising from personal 
injury or property damage, even if the injury or damage was caused by a 
breach of the bonded contract.
    (4) Once it has taken action to meet its obligations under the bond, 
the surety is entitled to any indemnification and identical standard of 
liability to which the contractor was entitled under the contract or 
applicable laws and regulations.
    (a) The requirement for performance and payment bonds is waived for 
cost-reimbursement contracts. However, for cost type contracts with 
fixed-price construction subcontracts over $25,000, require the prime 
contractor to obtain from each of its construction subcontractors--
    (i) A payment bond in favor of the prime contractor sufficient to 
pay labor and material costs; and
    (ii) A performance bond in an equal amount if available at no 
additional cost.
[56 FR 36404, July 31, 1991, as amended at 57 FR 42631, Sept. 15, 1992; 
58 FR 28469, May 13, 1993; 60 FR 29499, June 5, 1995]



228.105  Other types of bonds.

    Fidelity and forgery bonds generally are not required but may be 
used when--
    (1) Necessary for the protection of the Government or the 
contractor; or
    (2) The investigative and claims services of a surety company are 
desired.

[[Page 242]]



228.106  Administration.



228.106-7  Withholding contract payments.

    (a) Withholding may be appropriate in other than construction 
contracts (see 232.970-1(b)).
[57 FR 42707, Sept. 16, 1992]



228.170  Solicitation provision.

    When a requirement for a performance bond or other security is 
included in a solicitation for dismantling, demolition, or removal of 
improvements (see FAR 37.300), use the provision at 252.228-7004, Bonds 
or Other Security. Set a period of time (normally ten days) for return 
of executed bonds.



                        Subpart 228.3--Insurance



228.304  Risk-pooling arrangements.

    The DoD has established the National Defense Projects Rating Plan, 
also known as the Special Casualty Insurance Rating Plan, as a risk-
pooling arrangement to minimize the cost to the Government of purchasing 
the liability insurance listed in FAR 28.307-2. Use the plan in 
accordance with the following guidelines when it provides the necessary 
coverage more advantageously than commercially available coverage.
    (1) The plan--
    (i) Is implemented by attaching an endorsement to standard insurance 
policy forms for workers' compensation, employer's liability, 
comprehensive general, and automobile liability. The endorsement states 
that the instant policy is subject to the National Defense Projects 
Rating Plan.
    (ii) Applies to eligible Defense projects of one or more 
departments/agencies. For purposes of this section, a Defense project is 
any eligible contract or group of contracts with the same contractor.
    (A) A Defense project is eligible when--
    (1) Eligible contracts represent, at the inception of the plan, at 
least 90 percent of the payroll for the total operations at project 
locations; and
    (2) The annual insurance premium is estimated to be at least 
$10,000.
    (B) A contract is eligible when it is--
    (1) Either domestic or foreign;
    (2) Cost-reimbursement type; or
    (3) Fixed price with redetermination provisions.
    (2) Under construction contracts, include construction 
subcontractors in the prime contractor's plan only when subcontractor 
operations are at the project site, and the subcontract provides that 
the prime contractor will furnish insurance.
    (3) Use the agreement in Table 28-1, Insurance Rating Plan 
Agreement, when the Government assumes contractor premium payments upon 
contract termination or completion.
    (4) The Federal Tort Claims Act provides protection for Government 
employees while driving Government-owned vehicles in the performance of 
their assigned duties. Include the endorsement in Table 28-2, Automobile 
Insurance Policy Endorsement, in automobile liability insurance policies 
provided under the National Defense Projects Rating Plan.

           Table 28-1.--Insurance Rating Plan Rating Agreement

Special Casualty Insurance Rating Plan Assignment-Assumption of Premium 
                               Obligations

    It is agreed that 100 percent * of the return premiums and premium 
refunds (and dividends) due or to become due the prime contractor under 
the policies to which the National Defense Projects Rating Plan 
Endorsement made a part of policy ____________ applies are hereby 
assigned to and shall be paid to the United States of America, and the 
prime contractor directs the Company to make such payments to the office 
designated for contract administration acting for and on account of the 
United States of America.

    * In the event the Government has less than a 100 percent interest 
in premium funds or dividends, modify the assignment to reflect the 
percentage of interest and extent of the Government's assumption of 
additional premium obligation.

    The United States of America hereby assumes and agrees to fulfill 
all present and future obligations of the prime contractor with respect 
to the payment of 100 percent  of the premiums under said policies.
    This agreement, upon acceptance by the prime contractor, the United 
States of America, and the Company shall be effective from ____________
 Accepted_______________________________________________________________
    (Date)


[[Page 243]]


 (Name of Insurance Company)____________________________________________
 By_____________________________________________________________________
    (Title of Official Signing)
 Accepted_______________________________________________________________
    (Date)
        United States of America
 By_____________________________________________________________________
    (Authorized Representative)
 Accepted_______________________________________________________________
    (Date)
 (Prime Contractor)_____________________________________________________
 By_____________________________________________________________________
    (Authorized Representative)

          Table 28-2.--Automobile Insurance Policy Endorsement

    It is agreed that insurance provided by the policy with respect to 
the ownership, maintenance, or use of automobiles, including loading and 
unloading thereof, does not apply to the following as insureds: The 
United States of America, any of its agencies, or any of its officers or 
employees.



228.305  Overseas workers' compensation and war-hazard insurance.

    (d) Submit requests for waiver through department/agency channels. 
Include the following--
    (i) Name and address of contractor;
    (ii) Contract number;
    (iii) Date of award;
    (iv) Place of performance;
    (v) Name of insurance company providing Defense Base Act coverage;
    (vi) Nationality of employees to whom waiver is to apply; and
    (vii) Reason for waiver.



228.307  Insurance under cost-reimbursement contracts.



228.307-1  Group insurance plans.

    The Defense Department Group Term Insurance Plan is available for 
contractor use under cost-reimbursement type contracts when approved as 
provided in department or agency regulations. A contractor is eligible 
if--
    (a) The number of covered employees is 500 or more; and
    (b) The contractor has all cost-reimbursement contracts; or
    (c) At least 90 percent of the payroll for contractor operations to 
be covered by the Plan is under cost-reimbursement contracts.



228.311  Solicitation provision and contract clause on liability insurance under cost-reimbursement contracts.



228.311-1  Contract clause.

    Use the clause at FAR 52.228-7, Insurance--Liability to Third 
Persons, in solicitations and contracts, other than those for 
construction and those for architect-engineer services, when a cost-
reimbursement contract is contemplated, unless the head of the 
contracting activity waives the requirement for use of the clause.
[56 FR 36404, July 31, 1991. Redesignated at 61 FR 50454, Sept. 26, 
1996]



228.370  Additional clauses.

    (a) Use the clause at 252.228-7000, Reimbursement for War-Hazard 
Losses, when--
    (1) The clause at FAR 52.228-4, Worker's Compensation and War-Hazard 
Insurance Overseas, is used; and
    (2) The head of the contracting activity decides not to allow the 
contractor to buy insurance for war-hazard losses.
    (b)(1) Use the clause at 252.228-7001, Ground and Flight Risk, in 
negotiated fixed-price contracts for aircraft production, modification, 
maintenance, repair, or overhaul, unless--
    (i) The aircraft is being acquired for a foreign military sale and 
the foreign government has not agreed to assume the risk; or
    (ii) The cost of insurance for damage, loss, or destruction of 
aircraft does not exceed $500, and the contracting officer agrees to 
recognize the insurance costs.
    (2) If appropriate, revise the clause at 252.228-7001, Ground and 
Flight Risk, as follows--
    (i) Include a modified definition of ``aircraft'' if the contract 
covers other than conventional types of winged aircraft, i.e., 
helicopters, vertical take-off aircraft, lighter-than-air airships or 
other nonconventional aircraft. The modified definition should describe 
a stage of manufacture comparable to the standard definition.
    (ii) Modify ``in the open'' to include ``hush houses,'' test hangars 
and comparable structures, and other designated areas.
    (iii) Expressly define the ``contractor's premises'' where the 
aircraft will

[[Page 244]]

be located during and for contract performance. These locations may 
include contract premises which are owned, leased, or premises where the 
contractor is a permittee or licensee or has a right to use, including 
Government airfields.
    (iv) Revise paragraph (d)(iii) of the clause to provide Government 
assumption of risk for transportation by conveyance on streets or 
highways when transportation is--
    (A) Limited to the vicinity of contractor premises; and
    (B) Incidental to work performed under the contract.
    (c)(1) Use the clause at 252.228-7002, Aircraft Flight Risk, in cost 
reimbursement contracts--
    (i) For the development, production, modification, maintenance, 
repair, or overhaul of aircraft; or
    (ii) Otherwise involving the furnishing of aircraft to the 
contractor by the Government.
    (iii) With the definition of ``aircraft'' modified, if appropriate, 
to include helicopters, vertical take-off aircraft, lighter-than-air 
airships or other nonconventional aircraft.
    (2) Use the clause at 252.228-7002, Aircraft Flight Risk, 
appropriately modified, in fixed price contracts when--
    (i) The clause at 252.228-7001, Ground and Flight Risk, is not used; 
and
    (ii) Contract performance involves the flight of Government 
furnished aircraft.
    (d) The clause at 252.228-7003, Capture and Detention, may be used 
when contractor employees are subject to capture and detention and may 
not be covered by the War Hazards Compensation Act (42 U.S.C. 1701 et 
seq.).
    (e) The clause at 252.228-7005, Accident Reporting and Investigation 
Involving Aircraft, Missiles, and Space Launch Vehicles, may be used in 
solicitations and contracts which involve the manufacture, modification, 
overhaul, or repair of these items.
    (f) Use the clause at 252.228-7006, Compliance with Spanish Laws and 
Insurance, in solicitations and contracts for services or construction 
to be performed in Spain by other than a Spanish contractor or 
subcontractor.
[56 FR 36404, July 31, 1991, as amended at 57 FR 42631, Sept. 15, 1992; 
62 FR 34125, June 24, 1997]



PART 229--TAXES--Table of Contents




                         Subpart 229.1--General

Sec.
229.101  Resolving tax problems.

                     Subpart 229.4--Contract Clauses

229.402  Foreign contracts.
229.402-1  Foreign fixed-price contracts.
229.402-70  Additional clauses.

        Subpart 229.70--Special Procedures for Overseas Contracts

229.7000  Scope of subpart.
229.7001  Tax exemption in Spain
229.7002  Tax exemption in the United Kingdom.
229.7002-1  Value added tax.
229.7002-2  Import duty.
229.7002-3  Value added tax or import duty problem resolution.
229.7002-4  Information required by HM Customs and Excise.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36405, July 31, 1991, unless otherwise noted.



                         Subpart 229.1--General



229.101  Resolving tax problems.

    (a) Within DoD, the agency-designated legal counsels are the defense 
agency General Counsels, the General Counsels of the Navy and Air Force, 
and for the Army, the Chief, Contract Law Division, Office of the Judge 
Advocate General.
    (c) The contracting officer may direct the contractor to litigate 
the applicability of a particular tax if--
    (i) The contract is either a cost reimbursement type or a fixed 
price type with a tax escalation clause; and
    (ii) The direction is coordinated with the agency-designated legal 
counsel through the DoD Tax Policy and Advisory Group.
    (d)(i) Tax relief agreements between the United States and foreign 
governments in Europe that exempt the United States from payment of 
specific

[[Page 245]]

taxes on purchases made for common defense purposes are maintained by 
the United States European Command (USEUCOM). For further information 
contact HQ USEUCOM, Attn: ECLA, Unit 30400, Box 1000, APO AE 09128; 
Telephone; DSN 430-7474, Commercial 49-0711-680-7474; Telefax: 49-0711-
680-7408.
    (ii) Tax relief also may be available in countries that have not 
signed tax relief agreements. The potential for such relief should be 
explored in accordance with paragraph (d)(iii) of this section.
    (iii) Review DoDD 5100.64, Department of Defense Foreign Tax Relief 
Program, before contracting with a foreign source. Refer questions on 
implementation of the program to the Commanding Officers in Table 29-1, 
Designated Commanding Officers, which have been designated under 
subsection E.7 of DoDD 5100.64 to serve as--
    (A) Single point of contact for U.S. contracting offices for 
investigation and resolution of specific foreign tax relief matters; and
    (B) Liaison with responsible diplomatic mission and local foreign 
tax authorities.
    (iv) Refer foreign tax relief questions which have not been resolved 
by the designated Commanding Officer to the agency-designated legal 
counsel.
    (v) When an acquisition is for a contract to be performed in a 
country or area listed in Table 29-1, Designated Commanding Officers--
    (A) Obtain from the designated Commanding Officer detailed 
information concerning the taxes and duties from which the Government of 
the United States is exempt, and
    (B) Provide the information to prospective offerors.
    (C) Do not provide prospective offerors any other information about 
foreign taxes or duties.
    (D) Issue tax exemption certificates, as appropriate, to assist the 
contractor in obtaining relief from foreign taxes and duties which were 
excluded from the contract price.
    (E) Seek advice and assistance from the designated Commanding 
Officer and, if necessary, the agency-designated legal counsel if the 
contractor notifies the contracting officer that it has been assessed a 
tax or duty by a foreign government which could increase the contract 
price.
    (vi) Also see subpart 229.70 for special procedures for obtaining 
tax relief and duty-free import privileges when conducting U.S. 
Government acquisitions in certain foreign countries.

               Table 29-1--Designated Commanding Officers               
------------------------------------------------------------------------
                                                Designated commanding   
              Country or area                          officer          
------------------------------------------------------------------------
Australia.................................  Commander in Chief, Pacific 
                                             Representative, Australia. 
Azores....................................  Commander, U.S. Forces,     
                                             Azores.                    
Bahrain...................................  Commander in Chief, U.S.    
                                             Naval Forces, Europe.      
Belgium...................................  Commander in Chief, U.S.    
                                             Army, Europe.              
Bermuda...................................  Commanding Officer, U.S.    
                                             Naval Air Station, Bermuda.
Canada....................................  Commander, Space Command.   
Caribbean Islands (including Bahamas).....  Commander, Antilles Defense 
                                             Command.                   
Denmark...................................  Commander in Chief, U.S. Air
                                             Forces, Europe.            
Ethiopia..................................  Commander in Chief, U.S.    
                                             Army, Europe.              
France....................................  Commander in Chief, U.S.    
                                             Army, Europe.              
Germany...................................  Commander in Chief, U.S.    
                                             Army, Europe.              
Greece....................................  Commander in Chief, U.S. Air
                                             Forces, Europe.            
Greenland.................................  Commander, Space Command.   
Iceland...................................  Commander, Iceland Defense  
                                             Force.                     
Iran......................................  Commander in Chief, U.S.    
                                             Army, Europe.              
Italy.....................................  Commander in Chief, U.S.    
                                             Naval Forces, Europe.      
Japan.....................................  Commander, U.S. Forces,     
                                             Japan.                     
Korea.....................................  Commander, U.S. Forces,     
                                             Korea.                     
Luxembourg................................  Commander in Chief, U.S.    
                                             Army, Europe.              
Morocco...................................  Commander in Chief, U.S.    
                                             Naval Forces, Europe.      
Netherlands...............................  Commander in Chief, U.S. Air
                                             Forces, Europe.            
New Zealand...............................  Commander, U.S. Naval       
                                             Support Forces, Antarctica.
Norway....................................  Commander in Chief, U.S. Air
                                             Forces, Europe.            
Philippines...............................  Commander in Chief, Pacific 
                                             Representative,            
                                             Philippines.               
Portugal..................................  Commander in Chief, U.S.    
                                             Naval Forces, Europe.      
Spain.....................................  Commander in Chief, U.S. Air
                                             Forces, Europe.            
Taiwan....................................  Commander, U.S. Military    
                                             Assistance Command,        
                                             Thailand.                  
Turkey....................................  Commander in Chief, U.S. Air
                                             Forces, Europe.            
United Kingdom............................  Commander in Chief, U.S. Air
                                             Forces, Europe.            
------------------------------------------------------------------------

[56 FR 36405, July 31, 1991, as amended at 62 FR 34125, June 24, 1997]



                     Subpart 229.4--Contract Clauses

    Source: 62 FR 34125, June 24, 1997, unless otherwise noted.

[[Page 246]]



229.402  Foreign contracts.



229.402-1  Foreign fixed-price contracts.

    Use the clause at 252.229-7000, Invoices Exclusive of Taxes or 
Duties, in solicitations and contracts when a fixed-price contract will 
be awarded to a foreign concern.



229.402-70  Additional clauses.

    (a) Use the clause at 252.229-7001, Tax Relief, in solicitations and 
contracts when a contract will be awarded to a foreign concern in a 
foreign country. When contract performance will be in Germany, use the 
clause with its Alternate I.
    (b) Use the clause at 252.229-7002, Customs Exemptions (Germany), in 
solicitations and contracts requiring the import of U.S. manufactured 
products into Germany.
    (c) Use the clause at 252.229-7003, Tax Exemptions (Italy), in 
solicitations and contracts when contract performance will be in Italy.
    (d) Use the clause at 252.229-7004, Status of Contractor as a Direct 
Contractor (Spain), in solicitations and contracts requiring the import 
into Spain of supplies for construction, development, maintenance, or 
operation of Spanish-American installations and facilities.
    (e) Use the clause at 252.229-7005, Tax Exemptions (Spain), in 
solicitations and contracts when contract performance will be in Spain.
    (f) Use the clause at 252.229-7006, Value Added Tax Exclusion 
(United Kingdom), in solicitations and contracts when contract 
performance will be in the United Kingdom.
    (g) Use the clause at 252.229-7007, Verification of United States 
Receipt of Goods, in solicitations and contracts when contract 
performance will be in the United Kingdom.
    (h) Use the clause at 252.229-7008, Relief from Import Duty (United 
Kingdom), in solicitations issued and contracts awarded in the United 
Kingdom.
    (i) Use the clause at 252.229-7009, Relief from Customs Duty and 
Value Added Tax on Fuel (Passenger Vehicles) (United Kingdom), in 
solicitations issued and contracts awarded in the United Kingdom for 
fuels (gasoline or diesel) and lubricants used in passenger vehicles 
(excluding taxis).
    (j) Use the clause at 252.229-7010, Relief from Customs Duty on Fuel 
(United Kingdom), in solicitations issued and contracts awarded in the 
United Kingdom that require the use of fuels (gasoline or diesel) and 
lubricants in taxis or vehicles other than passenger vehicles.



        Subpart 229.70--Special Procedures for Overseas Contracts

    Source: 62 FR 34125, June 24, 1997, unless otherwise noted.



229.7000  Scope of subpart.

    This subpart prescribes procedures to be used by contracting 
officers to obtain tax relief and duty-free import privileges when 
conducting U.S. Government acquisitions in certain foreign countries.



229.7001  Tax exemption in Spain.

    (a) The Joint United States Military Group (JUSMG), Spain Policy 
Directive 400.4, or subsequent directive, applies to U.S. contracting 
offices acquiring supplies or services in Spain when the introduction of 
material or equipment into Spain is required for contract performance.
    (b) Upon award of a contract with a Direct Contractor, as defined in 
the clause at 252.229-7004, the contracting officer will notify JUSMG-
MAAG Madrid, Spain, and HQ 16AF/LGTT and forward three copies of the 
contract to JUSMG-MAAG, Spain.
    (c) If copies of the contract are not available and duty-free import 
of equipment or materials is urgent, the contracting officer will send 
JUSMG-MAAG three copies of the Letter of Intent or a similar document 
indicating the pending award. In these cases, authorization for duty-
free import will be issued by the Government of Spain. Upon formal 
award, the contracting officer will forward three copies of the 
completed contract to JUSMG-MAAG, Spain.
    (d) The contracting officer will notify JUSMG-MAAG, Spain, and HQ 
16AF/LGTT of ports-of-entry and identify the customs agents who will 
clear property on their behalf. Additional

[[Page 247]]

documents required for port-of-entry and customs clearance can be 
obtained by contacting HQ 16AF/LGTT. This information will be passed to 
the Secretaria General Tecnica del Ministerio de Hacienda (Technical 
General Secretariat of the Ministry of Finance). A list of customs 
agents may be obtained from the 600 ABG, APO AE 90646.



229.7002  Tax exemption in the United Kingdom.

    This section contains procedures to be followed in securing relief 
from the British value added tax and import duties.



229.7002-1  Value added tax.

    (a) U.S. Government purchases qualifying for tax relief are 
equipment, materials, facilities, and services for the common defense 
effort and for foreign aid programs.
    (b) To facilitate the resolution of issues concerning specific 
waivers of import duty or tax exemption for U.S. Government purchases 
(see 229.7002-3), contracting offices shall provide the name and 
activity address of personnel who have been granted warranted 
contracting authority to Her Majesty's (HM) Customs and Excise at the 
following address: HM Customs and Excise, International Customs Division 
G, Branch 4, Adelaide House, London Bridge, London EC4R 9DB.



229.7002-2  Import duty.

    No import duty shall be paid by the United States and contract 
prices shall be exclusive of duty, except when the administrative cost 
compared to the low dollar value of a contract makes it impracticable to 
obtain relief from contract import duty. In this instance, the 
contracting officer shall document the contract file with a statement 
that--
    (a) The administrative burden of securing tax relief under the 
contract was out of proportion to the tax relief involved;
    (b) It is impracticable to secure tax relief;
    (c) Tax relief is therefore not being secured; and
    (d) The acquisition does not involve the expenditure of any funds to 
establish a permanent military installation.



229.7002-3  Value added tax or import duty problem resolution.

    In the event a value added tax or import duty problem cannot be 
resolved at the contracting officer's level, refer the issue to HQ Third 
Air Force, Staff Judge Advocate, Unit 4840, Box 45, APO AE 09459. Direct 
contact with HM Customs and Excise in London is prohibited.



229.7002-4  Information required by HM Customs and Excise.

    (a) School bus contacts. Provide one copy of the contract and all 
modifications to HM Customs and Excise.
    (b) Road fuel contracts. For contracts that involve an application 
for relief from duty on the road fuel used in performance of the 
contract, provide--
    (1) To HM Customs and Excise--
    (i) Contract number;
    (ii) Name and address of contractor;
    (iii) Type of work (e.g., laundry, transportation);
    (iv) Area of work; and
    (v) Period of performance.
    (2) To the regional office of HM Custom and Excise to which the 
contractor applied for relief from the duty on road fuel--copy of the 
contract.
    (c) Other contracts awarded to United Kingdom firms. Provide 
information when requested by HM Customs and Excise.



PART 230--COST ACCOUNTING STANDARDS--Table of Contents




Sec.

    Subpart 230.70--Facilities Capital Employed for Facilities in Use

230.7000  Contract facilities capital estimates.
230.7001  Use of DD Form 1861.
230.7001-1  Purpose.
230.7001-2  Completion instructions.
230.7002  Preaward facilities capital applications.
230.7003  Postaward facilities capital applications.
230.7003-1  Interim billings based on costs incurred.
230.7003-2  Final settlement.
230.7004  Administrative procedures.

[[Page 248]]

230.7004-1  Forms CASB-CMF.
230.7004-2  DD Form 1861.

    Subpart 230.71--Facilities Capital Employed for Facilities Under 
                              Construction

230.7100  Definitions.
230.7101  Calculations.
230.7101-1  Cost of money.
230.7101-2  Representative investment.
230.7102  Determining imputed cost of money.
230.7103  Preaward capital employed application.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36406, July 31, 1991, unless otherwise noted.



    Subpart 230.70--Facilities Capital Employed for Facilities in Use



230.7000  Contract facilities capital estimates.

    (a) The contracting officer will estimate the facilities capital 
cost of money and capital employed using--
    (1) An analysis of the appropriate Forms CASB-CMF and cost of money 
factors; and
    (2) DD Form 1861, Contract Facilities Capital Cost of Money.



230.7001  Use of DD Form 1861.



230.7001-1  Purpose.

    The DD Form 1861 provides a means of linking the Form CASB-CMF and 
DD Form 1547, Record of Weighted Guidelines Application. It--
    (a) Enables the contracting officer to differentiate profit 
objectives for various types of assets (land, buildings, equipment). The 
procedure is similar to applying overhead rates to appropriate overhead 
allocation bases to determine contract overhead costs.
    (b) Is designed to record and compute the contract facilities 
capital cost of money and capital employed which is carried forward to 
DD Form 1547.



230.7001-2  Completion instructions.

    Complete a DD Form 1861 only after evaluating the contractor's cost 
proposal, establishing cost of money factors, and establishing a 
prenegotiation objective on cost. Complete the form as follows:
    (a) List overhead pools and direct-charging service centers (if 
used) in the same structure as they appear on the contractor's cost 
proposal and Form CASB-CMF. The structure and allocation base units-of-
measure must be compatible on all three displays.
    (b) Extract appropriate contract overhead allocation base data, by 
year, from the evaluated cost breakdown or prenegotiation cost objective 
and list against each overhead pool and direct-charging service center.
    (c) Multiply each allocation base by its corresponding cost of money 
factor to get the facilities capital cost of money estimated to be 
incurred each year. The sum of these products represents the estimated 
contract facilities capital cost of money for the year's effort.
    (d) Total contract facilities cost of money is the sum of the yearly 
amounts.
    (e) Since the facilities capital cost of money factors reflect the 
applicable cost of money rate in Column 1 of Form CASB-CMF, divide the 
contract cost of money by that same rate to determine the contract 
facilities capital employed.



230.7002  Preaward facilities capital applications.

    To establish cost and price objectives, apply the facilities capital 
cost of money and capital employed, as determined under 230.7000, as 
follows:
    (a) Cost of Money--(1) Cost Objective. Use the imputed facilities 
capital cost of money, with normal, booked costs, to establish a cost 
objective or the target cost when structuring an incentive type 
contract. Do not adjust target costs established at the outset even 
though actual cost of money rates become available during the period of 
contract performance.
    (2) Profit Objective. When measuring the contractor's effort for the 
purpose of establishing a prenegotiation profit objective, restrict the 
cost base to normal, booked costs. Do not include cost of money as part 
of the cost base.
    (b) Facilities Capital Employed. Assess and weight the profit 
objective or risk associated with facilities capital employed in 
accordance with the profit guidelines at 215.970-1(c).

[[Page 249]]



230.7003  Postaward facilities capital applications.



230.7003-1  Interim billings based on costs incurred.

    (a) The contractor may include contract facilities capital cost of 
money in cost reimbursement and progress payment invoices. To determine 
the amount that qualifies as cost incurred, multiply the incurred 
portions of the overhead pool allocation bases by the latest available 
cost of money factors. These cost of money calculations are interim 
estimates subject to adjustment.
    (b) As actual cost of money factors under CAS 414 and FAR 31.205-10 
are finalized, use the new factors to calculate contract facilities cost 
of money for the next accounting period.



230.7003-2  Final settlement.

    (a) Contract facilities capital cost of money for final cost 
determination or repricing is based on each year's final cost of money 
factors determined under CAS 414 and supported by separate Forms CASB-
CMF.
    (b) Separately compute contract facilities cost of money in a manner 
similar to yearly final overhead rates. Also like overhead costs, 
include in the final settlement an adjustment from interim to final 
contract cost of money. Do not, however, adjust estimated or target 
cost.



230.7004  Administrative procedures.



230.7004-1  Forms CASB-CMF

    (a) Forms CASB-CMF are normally initiated by the contractor under 
the same circumstances as Forward Pricing Rate Agreements (see FAR 
15.809) and evaluated as complementary documents and procedures.
    (b) Separate forms are required for each prospective cost accounting 
period of contract performance.
    (c) The contractor may submit annually or with individual contract 
price proposals, as agreed with the administrative contracting officer 
(ACO).
    (d) The contractor must submit a final form under CAS 414 as soon as 
possible after the end of each accounting period, together with a 
proposal for actual overhead costs and rates.



230.7004-2  DD Form 1861.

    (a) The contracting officer may ask the ACO to complete the forms as 
part of field pricing support.
    (b) When the Weighted Guidelines Method is used, completion of the 
DD Form 1861 requires information not included on the Form CASB-CMF, 
i.e., distribution percentages of land, building, and equipment for the 
business unit performing the contract. Choose the most practical method 
for obtaining this information, for example--
    (1) Contract administration offices could obtain the information 
through the process used to establish factors for facilities capital 
cost of money or could establish advance agreements on distribution 
percentages for inclusion in field pricing reports;
    (2) The corporate ACO could obtain distribution percentages; or
    (3) The contracting officer could request the information through a 
solicitation provision.



    Subpart 230.71--Facilities Capital Employed for Facilities Under 
                              Construction



230.7100  Definitions.

    (a) Intangible capital asset is an asset that has no physical 
substance, has more than minimal value, and is expected to be held by an 
enterprise for continued use or possession beyond the current accounting 
period for the benefit it yields.
    (b) Tangible capital asset is an asset that has physical substance, 
more than minimal value, and is expected to be held by an enterprise for 
continued use or possession beyond the current accounting period for the 
service it yields.
    (c) Cost of money rate is either--
    (1) The interest rate determined by the Secretary of the Treasury 
under Public Law 92-41 (85 Stat. 97); or
    (2) The time-weighted average of the interest rate for each cost 
accounting period during which the asset is being constructed, 
fabricated, or developed.
    (d) Representative investment is the calculated amount considered 
invested by the contractor during the cost accounting period to 
construct, fabricate, or develop the asset.

[[Page 250]]



230.7101  Calculations.



230.7101-1  Cost of money.

    (a) The interest rate in 230.7100(c)(1) is established semi-annually 
and is published in the Federal Register during the fourth week of 
December and June.
    (b) To calculate the time-weighted average interest rate--
    (1) Multiply the various rates in effect during the months of 
construction by the number of months each rate was in effect; and
    (2) Divide the sum of the products by the total number of months in 
which the rates were experienced.



230.7101-2  Representative investment.

    (a) The calculation of the representative investment requires 
consideration of the rate or expenditure pattern of the costs to 
construct, fabricate, or develop a capital asset.
    (b) If a majority of the costs were incurred toward the beginning, 
middle, or end of the cost accounting period, the contractor shall 
either--
    (1) Determine a representative investment amount for the cost 
accounting period by calculating the average of the month-end balances 
for that cost accounting period; or
    (2) Treat month-end balances as individual representative investment 
amounts.
    (c) If the costs were incurred in a fairly uniform expenditure 
pattern throughout the construction, fabrication, or development period, 
the contractor may--
    (1) Determine a representative investment amount for the cost 
accounting period by averaging the beginning and ending balances of the 
construction, fabrication, or development cost account for the cost 
accounting period; or
    (2) Treat month-end balances as individual representative investment 
amounts.



230.7102  Determining imputed cost of money.

    (a) Determine the imputed cost of money for an asset under 
construction, fabrication, or development by applying a cost of money 
rate (see 230.7101-1) to the representative investment amount (see 
230.7101-2).
    (1) When a representative investment amount is determined for a cost 
accounting period in accordance with 230.7101-2(b)(1) or 230.7101-
2(c)(1), the cost of money will be the time-weighted average rate.
    (2) When a monthly representative investment amount is used in 
accordance with 230.7101-2(b)(2) or 230.7101-2(c)(2), the cost of money 
will be the interest rate in effect each month. (Under this method, the 
cost of money is determined monthly and the total for the cost 
accounting period is the sum of the monthly amounts.)
    (b) The imputed cost of money will be capitalized only once in any 
cost accounting period, either at the end of the period or at the end of 
the construction, fabrication, or development period, whichever comes 
first.
    (c) When the construction of an asset takes more than one cost 
accounting period, the cost of money capitalized for the first cost 
accounting period will be included in determining the representative 
investment amount for any future cost accounting periods.



230.7103  Preaward capital employed application.

    An offset to the profit objectives as set forth in FAR Subpart 15.9 
is not required for CAS 417 cost of money.



PART 231--CONTRACT COST PRINCIPLES AND PROCEDURES--Table of Contents




Sec.

                      Subpart 231.1--Applicability

231.100  Scope of subpart.
231.100-70  Contract clause.

         Subpart 231.2--Contracts With Commercial Organizations

231.205  Selected costs.
231.205-6  Compensation for personal services.
231.205-10  Cost of money.
231.205-18  Independent research and development and bid and proposal 
          costs.
231.205-22  Legislative lobbying costs.
231.205-70  External restructuring costs.
231.205-71  Defense capability preservation agreements.

[[Page 251]]

         Subpart 231.3--Contracts With Educational Institutions

231.303  Requirements.

  Subpart 231.6--Contracts With State, Local, and Federally Recognized 
                        Indian Tribal Governments

231.603  Requirements.

          Subpart 231.7--Contracts With Nonprofit Organizations

231.703  Requirements.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36408, July 31, 1991, unless otherwise noted.



                      Subpart 231.1--Applicability



231.100  Scope of subpart.



Sec. 231.100-70  Contract clause.

    Use the clause at 252.231-7000, Supplemental Cost Principles, in all 
solicitations and contracts which are subject to the principles and 
procedures described in FAR subpart 31.1, 31.2, 31.6, or 31.7.
[59 FR 27672, May 27, 1994]



         Subpart 231.2--Contracts With Commercial Organizations



231.205  Selected costs.



231.205-6  Compensation for personal services.

    (a)(2)(i)(A) Costs for individual compensation in excess of $250,000 
per year are unallowable under DOD contracts that are awarded after 
April 15, 1995, and are funded by fiscal year 1995 appropriations 
(Section 8117 of Pub. L. 103-335).
    (B) Costs for individual compensation in excess of $200,000 per year 
are unallowable under DOD contracts that are awarded after July 1, 1996, 
and are funded by fiscal year 1996 appropriations (Section 8086 of Pub. 
L. 104-61).
    (ii) Costs for individual compensation in excess of $250,000 per 
year are unallowable under new DoD contracts funded by fiscal year 1997 
appropriations (Section 8071 of Public Law 104-208). For purposes of 
this limitation, the term ``compensation'' means--
    (A) The total amount of taxable wages paid to the employee for the 
year concerned; plus
    (B) The total amount of elective deferred compensation earned by the 
employee in the year concerned.
    (f)(1) Costs for bonuses or other payments in excess of the normal 
salary paid by the contractor to an employee, that are part of 
restructuring costs associated with a business combination, are 
unallowable under DoD contracts funded by fiscal year 1996 
appropriations (Section 8122 of Pub. L. 104-61) or fiscal year 1997 
appropriations (Section 8095 of Pub. L. 104-208). This limitation does 
not apply to severance payments or early retirement incentive payments. 
(See 231.205-70(b) for the definitions of ``business combination'' and 
``restructuring costs.'')
[57 FR 53600, Nov. 12, 1992, as amended at 58 FR 28469, May 13, 1993; 60 
FR 2331, Jan. 9, 1995; 60 FR 61598, Nov. 30, 1995; 61 FR 7077, Feb. 26, 
1996; 61 FR 36306, July 10, 1996; 61 FR 50454, Sept. 26, 1996; 61 FR 
58490, Nov. 15, 1996; 61 FR 65479, Dec. 13, 1996]



231.205-10  Cost of money.

    The contractor also must comply with subpart 230.70 and maintain 
records to demonstrate compliance.



231.205-18  Independent research and development and bid and proposal costs.

    (c)(1)(i)(C)(1) Total incurred IR&D/B&P costs, including total IR&D/
B&P ceiling amounts which are negotiated pursuant to FAR 31.205-
18(c)(1), are fully allocable to all final cost objectives of the 
contractor. The amount of IR&D/B&P costs allowable under contracts which 
are subject to advance agreements negotiated by DoD shall not exceed the 
lesser of--
    (i) Such contracts' allocable share of incurred IR&D/B&P costs;
    (ii) Such contracts' allocable share of the total IR&D/B&P ceiling; 
or
    (iii) The amount of incurred IR&D/B&P costs for projects having 
potential interest to DoD.
    (2) Allowable IR&D/B&P costs are limited to those for projects which 
are of potential interest to DoD, including activities that--

[[Page 252]]

    (i) Strengthen the defense industrial and technology base of the 
United States;
    (ii) Enhance the industrial competitiveness of the United States;
    (iii) Promote the development of technologies identified as critical 
in the plan required under 10 U.S.C. 2508;
    (iv) Increase the development of technologies useful for both the 
private commercial sector and the public sector; or
    (v) Develop efficient and effective technologies for achieving such 
environmental benefits as improved environmental data gathering, 
environmental cleanup and restoration, pollution-reduction in 
manufacturing, environmental conservation, and environmentally safe 
management of facilities.
    (3) The contracting officer will--
    (i) Determine whether IR&D/B&P projects are of potential interest to 
DoD; and
    (ii) Provide the results of the determination to the contractor.
    (4) See 225.7303 for additional allowability provisions affecting 
foreign military sale contracts.
    (2) Departments/agencies shall not supplement this regulation in any 
way that limits IR&D/B&P cost allowability. See 225.7303-2 for 
allowability exceptions for foreign military sales contracts.
    (i) In addition to the limitations in FAR 31.205-18(c)(2)(i), for 
major contractors--
    (1) The amount of IR&D/B&P costs allowability under DoD contracts 
shall not exceed the lesser of--
    (i) Such contracts' allocable share of incurred IR&D/B&P costs;
    (ii) Such contracts' allocable share of the contractor's total 
maximum allowable amount; or
    (iii) The amount of incurred IR&D/B&P costs for projects having 
potential interest to DoD.
    (2) Allowable IR&D/B&P costs are limited to those for projects which 
are of potential interest to the DoD, including activities intended to 
accomplish any of the following--
    (i) Enable superior performance of future U.S. weapon systems and 
components;
    (ii) Reduce acquisition costs and life-cycle costs of military 
systems;
    (iii) Strengthen the defense industrial and technology base of the 
United States;
    (iv) Enhance the industrial competitiveness of the United States;
    (v) Promote the development of technologies identified as critical 
under 10 U.S.C. 2522;
    (vi) Increase the development and promotion of efficient and 
effective applications of dual-use technologies;
    (vii) Provide efficient and effective technologies for achieving 
such environmental benefits as: improved environmental data gathering, 
environmental cleanup and restoration, pollution reduction in 
manufacturing, environmental conservation, and environmentally safe 
management of facilities.
    (ii) The cognizant contract administration office shall furnish 
contractors with guidance on financial information needed to support 
IR&D/B&P costs and on technical information needed from major 
contractors to support the potential interest to DoD determination (see 
also 242.771-3(a)).
    (iii) The total maximum allowable amount limitation may be waived at 
a level above the contracting officer. A waiver may be appropriate for 
contractors whose significant growth in sales or IR&D/B&P spending 
justify higher levels of reimbursement.
[56 FR 67217, Dec. 30, 1991, as amended at 57 FR 53600, Nov. 12, 1992; 
59 FR 27672, May 27, 1994]



231.205-22  Legislative lobbying costs.

    (a) Preparing any material, report, list, or analysis on the actual 
or projected economic or employment impact in a particular State or 
congressional district of an acquisition program for which all research, 
development, testing, and evaluation has not been completed (10 U.S.C. 
2249).
[62 FR 47155, Sept. 8, 1997]



231.205-70  External restructuring costs.

    (a) Scope. This subsection prescribes policies and procedures for 
allowing contractor external restructuring costs when net savings would 
result for DoD.

[[Page 253]]

This subsection also implements Section 818 of the National Defense 
Authorization Act for Fiscal Year 1995 (Pub. L. 103-337) and Section 
8115 of the National Defense Appropriations Act for Fiscal Year 1997 
(Pub. L. 104-208).
    (b) Definitions. As used in this subsection:
    (1) Business combination means a transaction whereby assets or 
operations of two or more companies not previously under common 
ownership or control are combined, whether by merger, acquisition, or 
sale/purchase of assets.
    (2) External restructuring activities means restructuring activities 
occurring after a business combination that affect the operations of 
companies not previously under common ownership or control. They do not 
include restructuring activities occurring after a business combination 
that affect the operations of only one of the companies not previously 
under common ownership or control, or, when there has been no business 
combination, restructuring activities undertaken within one company. 
External restructuring activities are a direct outgrowth of a business 
combination. They normally will be initiated within 3 years of the 
business combination.
    (3) Restructuring activities means nonroutine, nonrecurring, or 
extraordinary activities to combine facilities, operations, or 
workforce, in order to eliminate redundant capabilities, improve future 
operations, and reduce overall costs. Restructuring activities do not 
include routine or ongoing repositionings and redeployments of a 
contractor's productive facilities or workforce (e.g., normal plant 
rearrangement or employee relocation), nor do they include other routine 
or ordinary activities charged as indirect costs that would otherwise 
have been incurred (e.g., planning and analysis, contract administration 
and oversight, or recurring financial and administrative support).
    (4) Restructuring costs means the costs, including both direct and 
indirect, of restructuring activities. Restructuring costs that may be 
allowed include, but are not limited to, severance pay for employees, 
early retirement incentive payments for employees, employee retraining 
costs, relocation expense for retained employees, and relocation and 
rearrangement of plant and equipment. For purposes of this definition, 
if restructuring costs associated with external restructuring activities 
allocated to DoD contracts are less than $2.5 million, the costs shall 
not be subject to the audit, review, and certification requirements of 
231.205-70(c)(1); instead, the normal rules for determining cost 
allowability in accordance with FAR Part 31 shall apply.
    (5) Restructuring savings means cost reductions, including both 
direct and indirect cost reductions, that result from restructuring 
activities. Reassignments of cost to future periods are not 
restructuring savings.
    (c) Limitations on cost allowability. (1) Restructuring costs 
associated with external restructuring activities shall not be allowed 
unless--
    (i) Such costs are allowable in accordance with FAR Part 31 and 
DFARS Part 231;
    (ii) An audit of projected restructuring costs and restructuring 
savings is performed;
    (iii) The cognizant administrative contracting officer (ACO) reviews 
the audit report and the projected costs and projected savings, 
determines that overall reduced costs should result for DoD, and 
negotiates an advance agreement in accordance with 231.205-70(d)(8); and
    (iv) A certification is made by the Under Secretary of Defense 
(Acquisition & Technology), his Principal Deputy or designee (in all 
cases, an individual appointed by the President and confirmed by the 
Senate), that projections of future restructuring savings resulting for 
DoD from the business combination are based on audited cost data and 
should result in overall reduced costs for DoD.
    (2) The audit, review, and certification required by 231.205-
70(c)(1) shall not apply to any business combination for which payments 
for restructuring costs were made before August 15, 1994, or for which 
the cognizant ACO executed an advance agreement establishing cost 
ceilings based on audit/negotiation of detailed cost proposals for

[[Page 254]]

individual restructuring projects before August 15, 1994.
    (3) Additionally, for business combinations that occur after 
September 30, 1996, no fiscal year 1997 appropriated funds may be 
obligated or expended to reimburse a contractor for restructuring costs 
associated with external restructuring activities unless--
    (i) The audited savings for DoD resulting from the restructuring 
will exceed the costs allowed by a factor of at least two to one; or
    (ii) The savings for DoD resulting from the restructuring will 
exceed the costs allowed, and the Secretary of Defense determines that 
the business combination will result in the preservation of a critical 
capability that might otherwise be lost to DoD.
    (d) Procedures and ACO responsibilities. As soon as it is known that 
the contractor will incur restructuring costs for external restructuring 
activities, the cognizant ACO shall:
    (1) Promptly execute a novation agreement, if one is required, in 
accordance with FAR subpart 42.12 and DFARS subpart 242.12 and include 
the provision at DFARS 242.1204(e).
    (2) Direct the contractor to segregate restructuring costs and to 
suspend these amounts from any billings, final contract price 
settlements, and overhead settlements until the certification in 
231.205-70(c)(1)(iv) is obtained.
    (3) Require the contractor to submit an overall plan of 
restructuring activities and an adequately supported proposal for 
planned restructuring projects. The proposal must include a breakout by 
year by cost element, showing the projected restructuring costs and 
projected restructuring savings.
    (4) Notify major buying activities of contractor restructuring 
actions and inform them about any potential monetary impacts on major 
weapons programs, when known.
    (5) Upon receipt of the contractor's proposal, as soon as 
practicable, adjust forward pricing rates to reflect the impact of 
projected restructuring savings. If restructuring costs are included in 
forward pricing rates prior to execution of an advance agreement in 
accordance with 231.205-70(d)(8), the contracting officer shall include 
a repricing clause in each fixed-price action that is priced based on 
the rates. The repricing clause must provide for a downward price 
adjustment to remove restructuring costs if the certification required 
by 231.205-70(c)(1)(iv) is not obtained.
    (6) Upon receipt of the contractor's proposal, immediately request 
an audit review of the contractor's proposal.
    (7) Upon receipt of the audit report, determine if restructuring 
savings will exceed restructuring costs on a present value basis.
    (8) Negotiate an advance agreement with the contractor setting 
forth, at a minimum, a cumulative cost ceiling for restructuring 
projects and, when necessary, a cost amortization schedule. The cost may 
not exceed the amount of projected restructuring savings on a present 
value basis. The advance agreement shall not be executed until the 
certification required by 231.205-70(c)(1)(iv) is obtained.
    (9) Submit to the Director of Defense Procurement, Office of the 
Under Secretary of Defense (Acquisition & Technology), ATTN: 
OUSD(A&T)DP/CPF, a recommendation for certification of net benefit. 
Include the information described in 231.205-70(e).
    (10) Consult with the Director of Defense Procurement, Office of the 
Under Secretary of Defense (Acquisition & Technology), when 231.205-
70(c)(3)(ii) applies.
    (e) Information needed to obtain certification of net benefit. (1) 
The novation agreement (if one is required).
    (2) The contractor's restructuring proposal.
    (3) The proposed advance agreement.
    (4) The audit report.
    (5) Any other pertinent information.
    (6) The cognizant ACO's recommendation for certification. This 
recommendation must clearly indicate that contractor projections of 
future cost savings resulting for DoD from the business combination are 
based on audited cost data and should result in overall reduced costs 
for the Department.
[61 FR 16881, Apr. 18, 1996; 61 FR 49531, Sept. 20, 1996, as amended at 
61 FR 50454, Sept. 26, 1996; 61 FR 64635, Dec. 6, 1996; 62 FR 49304, 
Sept. 19, 1997]

[[Page 255]]



231.205-71  Defense capability preservation agreements.

    (a) Scope and authority. Where it would facilitate the achievement 
of the policy objectives relating to defense reinvestment, 
diversification, and conversion set forth in 10 U.S.C. 2501(b), DoD may 
enter into a ``defense capability preservation agreement'' with a 
contractor. As authorized by Section 808 of the National Defense 
Authorization Act for Fiscal Year 1996 (Public Law 104-106), such an 
agreement would permit the contractor to claim certain indirect costs 
attributable to its private sector work as allowable costs on its 
defense contracts.
    (b) Procedure. A contractor may submit a request for such an 
agreement, together with appropriate justification, through the Deputy 
Under Secretary of Defense for Industrial Affairs and Installations, to 
the Under Secretary of Defense for Acquisition and Technology, who has 
exclusive approval or disapproval authority. The contractor should also 
provide an informational copy of any such request to the cognizant 
administrative contracting officer.
[61 FR 21975, May 13, 1996, as amended at 61 FR 50454, Sept. 26, 1996]



         Subpart 231.3--Contracts With Educational Institutions



231.303  Requirements.

    (1) Pursuant to section 841 of the National Defense Authorization 
Act for Fiscal Year 1994 (Pub. L. 103-160), no limitation may be placed 
on the reimbursement of otherwise allowable indirect costs incurred by 
an institution of higher education under a DoD contract awarded on or 
after November 30, 1993, unless that same limitation is applied 
uniformly to all other organizations performing similar work under DoD 
contracts. The 26 percent limitation imposed on administrative indirect 
costs by OMB Circular No. A-21 shall not be applied to DoD contracts 
awarded on or after November 30, 1993, to institutions of higher 
education because the same limitation is not applied to other 
organizations performing similar work.
    (2) The cognizant administrative contracting officer may waive the 
prohibition in 231.303(1) if the governing body of the institution of 
higher education requests the waiver to simplify the institution's 
overall management of DoD cost reimbursements under DoD contracts.
    (3) The limitations on allowable individual compensation at 231.205-
6(a)(2) (i) and (ii) also apply to this subpart.
    (4) Under 10 U.S.C. 2249, the costs cited in 231.205-22(a) are 
unallowable.
[59 FR 26144, May 19, 1994, as amended at 60 FR 2331, Jan. 9, 1995; 61 
FR 36306, July 10, 1996; 62 FR 47155, Sept. 8, 1997]



  Subpart 231.6--Contracts With State, Local, and Federally Recognized 
                        Indian Tribal Governments



231.603  Requirements.

    (1) The limitations on allowable individual compensation at 231.205-
6(a)(2) (i) and (ii) also apply to this subpart.
    (2) Under 10 U.S.C. 2249, the costs cited in 231.205-22(a) are 
unallowable.
[61 FR 36306, July 10, 1996, as amended at 62 FR 47155, Sept. 8, 1997]



          Subpart 231.7--Contracts With Nonprofit Organizations



231.703  Requirements.

    (1) The limitations on allowable individual compensation at 231.205-
6(a)(2) (i) and (ii) also apply to this subpart.
    (2) Under 10 U.S.C. 2249, the costs cited in 231.205-22(a) are 
unallowable.
[61 FR 36306, July 10, 1996, as amended at 62 FR 47155, Sept. 8, 1997]



PART 232--CONTRACT FINANCING--Table of Contents




Sec.

                         Subpart 232.1--General

232.102  Description of contract financing methods.
232.102-70  Provisional delivery payments.
232.108  Financial consultation.
232.111  Contract clauses.
232.111-70  Additional clause.
232.170  Responsibilities.
232.171  Contract Finance Committee.
232.172  Financial responsibility of contractors.

[[Page 256]]

232.172-1  Required financial reviews.
232.172-2  Appropriate information.
232.172-3  Cash flow forecasts.
232.173  Reduction or suspension of contract payments upon finding of 
          fraud.
232.173-1  General.
232.173-2  Definitions.
232.173-3  Responsibilities.
232.173-4  Procedures.
232.173-5  Reporting.

          Subpart 232.3--Loan Guarantees for Defense Production

232.302  Authority.

                     Subpart 232.4--Advance Payments

232.404  Exclusions.
232.409  Contracting officer action.
232.409-1  Recommendation for approval.
232.410  Findings, determination, and authorization.
232.412  Contract clause.
232.412-70  Additional clauses.
232.470  Advance payment pool.

             Subpart 232.5--Progress Payments Based on Costs

232.501  General.
232.501-1  Customary progress payment rates.
232.501-2  Unusual progress payments.
232.501-3  Contract price.
232.502  Preaward matters.
232.502-1  Use of customary progress payments.
232.502-1  -70  Customary foreign military sale progress payments.
232.502-1  -71  Customary flexible progress payments.
232.502-4  Contract clauses.
232.502-4  -70  Additional clauses.
232.503  Postaward matters.
232.503-6  Suspension or reduction of payments.
232.503-15  Application of Government title terms.

                      Subpart 232.6--Contract Debts

232.605  Responsibilities and cooperation among Government officials.
232.606  Debt determination and collection.
232.610  Demand for payment of contract debt.
232.616  Compromise actions.
232.617  Contract clause.
232.670  Transfer of responsibility for debt collection.
232.671  Bankruptcy reporting.

                     Subpart 232.7--Contract Funding

232.702  Policy.
232.703  Contract funding requirements.
232.703-1  General.
232.703-70  Military construction appropriations act restriction.
232.704  Limitation of cost or funds.
232.704-70  Incrementally funded fixed-price contracts.
232.705  Contract clauses.
232.705-70  Clause for limitation of Government's obligation.

                   Subpart 232.8--Assignment of Claims

232.803  Policies.
232.805  Procedure.
232.806  Contract clause.

                      Subpart 232.9--Prompt Payment

232.903  Policy.
232.905  Invoice payments.
232.906  Contract financing payments.
232.970  Payment of subcontractors.
232.970-1  Subcontractor assertions of nonpayment.
232.970-2  Subcontractor requests for information.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36409, July 31, 1991, unless otherwise noted.



                         Subpart 232.1--General



232.102  Description of contract financing methods.

    (e)(2) Progress payments based on percentage or stage of completion 
are authorized only for contracts for construction (as defined in FAR 
36.102), shipbuilding, and ship conversion, alteration, or repair.



232.102-70  Provisional delivery payments.

    (a) The contracting officer may establish provisional delivery 
payments to pay contractors for the costs of supplies and services 
delivered to and accepted by the Government under the following contract 
actions, if undefinitized--
    (1) Letter contracts contemplating a fixed-price contract;
    (2) Orders under basic ordering agreements;
    (3) Spares provisioning documents annexed to contracts;
    (4) Unpriced equitable adjustments on fixed-price contracts; and
    (5) Orders under indefinite delivery contracts.
    (b) Provisional delivery payments shall be--

[[Page 257]]

    (1) Used sparingly;
    (2) Priced conservatively; and
    (3) Reduced by liquidating previous progress payments in accordance 
with the Progress Payments clause.
    (c) Provisional delivery payments shall not--
    (1) Include profit;
    (2) Exceed funds obligated for the undefinitized contract action; or
    (3) Influence the definitized contract price.



232.108  Financial consultation.

    (1) Department/agency contract financing offices are--
    (i) Army--Office, Assistant Secretary of the Army (Financial 
Management);
    (ii) Navy--Executive Comptroller for Banking, Cash Management, 
Contract Financing and Compensation Systems, Assistant Comptroller of 
the Navy for Financial Management;
    (iii) Air Force--Chief of Banking and Contract Financing, 
Directorate of Accounting, Air Force Accounting and Finance Center;
    (iv) Defense agencies--Office of the agency comptroller.
    (2) The Under or Assistant Secretary, or other designated official, 
responsible for the comptroller function within the department or agency 
is the focal point for financing matters at the departmental/agency 
headquarters. Departments/agencies may establish contract financing 
offices at operational levels.
    (3) Contract financing offices should participate in--
    (i) Developing regulations for contract financing;
    (ii) Developing contract provisions for contract financing; and
    (iii) Resolving specific cases which involve unusual contract 
financing requirements.
[56 FR 36409, July 31, 1991, as amended at 60 FR 29499, June 5, 1995]



232.111  Contract clauses.



232.111-70  Additional clause.

    Use the clause at 252.232-7006, Reduction or Suspension of Contract 
Payments Upon Finding of Fraud, in all solicitations and contracts.
[57 FR 3358, Jan. 29, 1992]



232.170  Responsibilities.

    (a) The Director of Defense Procurement, Office of the Under 
Secretary of Defense (Acquisition & Technology), USD(A&T)DP, is 
responsible for ensuring uniform administration of DoD contract 
financing, including DoD contract financing policies and important 
related procedures.
    (b) The departments and agencies are responsible for their day-to-
day contract financing operations. Refer specific cases involving 
financing policy or important procedural issues to USD(A&T)DP for 
consideration (see also 201.24 for deviation request and approval 
procedures).
[56 FR 36409, July 31, 1991, as amended at 60 FR 61598, Nov. 30, 1995]



232.171  Contract Finance Committee.

    (a) The Contract Finance Committee consists of--
    (1) A representative of the USD(A&T)DP, serving as chairman;
    (2) A representative of the Comptroller of the Department of 
Defense; and
    (3) Two representatives of each military department and the Defense 
Logistics Agency (one representing contracting and one representing the 
contract finance office).
    (b) The Committee--
    (1) Advises and assists the USD(A&T)DP in ensuring proper and 
uniform application of policies, procedures, and forms;
    (2) Is responsible for formulating, revising, and promulgating 
uniform contract financing regulations;
    (3) May recommend to the Secretary of Defense through the USD(A&T)DP 
further policy directives on financing; and
    (4) Meets at the request of the Chair or a member.
[56 FR 36409, July 31, 1991, as amended at 60 FR 61598, Nov. 30, 1995]



232.172  Financial responsibility of contractors.

    Use the policies and procedures in this section in determining the 
financial capability of current or prospective contractors.

[[Page 258]]



232.172-1  Required financial reviews.

    The contracting officer shall perform a financial review when the 
contracting officer does not otherwise have sufficient information to 
make a positive determination of financial responsibility. In addition, 
the contracting officer shall consider performing a financial review--
    (a) Prior to award of a contract, when--
    (1) The contractor is on a list requiring preaward clearance or 
other special clearance before award;
    (2) The contractor is listed on the Consolidated List of Contractors 
Indebted to the Government (Hold-Up List), or is otherwise known to be 
indebted to the Government;
    (3) The contractor may receive Government assets such as contract 
financing payments or Government property;
    (4) The contractor is experiencing performance difficulties on other 
work; or
    (5) The contractor is a new company or a new supplier of the item.
    (b) At periodic intervals after award of a contract, when--
    (1) Any of the conditions of paragraphs (a) (2) through (5) of this 
subsection are applicable; or
    (2) There is any other reason to question the contractor's ability 
to finance performance and completion of the contract.



232.172-2  Appropriate information.

    (a) The contracting officer shall obtain whatever type and depth of 
financial and other information is required to establish a contractor's 
financial capability or disclose a contractor's financial condition. 
While the contracting officer should not request information that is not 
necessary for the protection of the Government's interests, the 
contracting officer must insist upon obtaining that information which is 
necessary. The unwillingness or inability of a contractor to present 
reasonably requested information in a timely manner, especially 
information that a prudent business person would be expected to have and 
use in the professional management of a business, may be a material fact 
in the determination of the contractor's responsibility and prospects 
for contract completion.
    (b) Obtain the following information to the extent required to 
protect the Government's interest. In addition, if the contracting 
officer concludes that information not listed below is required to 
comply with 232.172-1, that information should be requested. The 
information must be for the person(s) who are legally liable for 
contract performance. If the contractor is not a corporation, obtain the 
required information for each individual/joint venturer/partner--
    (1) Balance sheet and income statement--
    (i) For the current fiscal year (interim);
    (ii) For the most recent fiscal year and preferably, for the two 
preceding fiscal years. These should be certified by an independent 
public accountant or by an appropriate officer of the firm; and
    (iii) Forecasted for each fiscal year for the remainder of the 
period of contract performance;
    (2) Summary history of the contractor and its principal managers, 
disclosing any previous insolvencies--corporate or personal, and 
describing its products or services;
    (3) Statement of all affiliations disclosing--
    (i) Material financial interests of the contractor;
    (ii) Material financial interests in the contractor;
    (iii) Material affiliations of owners, officers, directors, major 
stockholders; and
    (iv) The major stockholders if the contractor is not a widely-
traded, publicly-held corporation;
    (4) Statement of all forms of compensation to each officer, manager, 
partner, joint venturer, or proprietor, as appropriate--
    (i) Planned for the current year;
    (ii) Paid during the past 2 years; and
    (iii) Deferred to future periods.
    (5) Business base and forecast which--
    (i) Shows, by significant markets, existing contracts and 
outstanding offers, including those under negotiation; and
    (ii) Is reconcilable to indirect cost rate projections.

[[Page 259]]

    (6) Cash forecast for the duration of the contract (see 232.172-3).
    (7) Financing arrangement information which discloses--
    (i) Availability of cash to finance contract performance;
    (ii) Contractor's exposure to financial crisis from creditor's 
demands;
    (iii) Degree to which credit security provisions could conflict with 
Government title terms under contract financing;
    (iv) Clearly stated confirmations of credit with no unacceptable 
qualifications; and
    (v) Unambiguous written agreement by a creditor if credit 
arrangements include deferred trade payments or creditor subordinations/
repayment suspensions.
    (8) Statement of all state, local, and Federal tax accounts, 
including special mandatory contributions, e.g., environmental 
superfund.
    (9) Description and explanation of the financial effect of issues 
such as--
    (i) Leases, deferred purchase arrangements, patent or royalty 
arrangements;
    (ii) Insurance, when relevant to the contract;
    (iii) Contemplated capital expenditures, changes in equity, or 
contractor debt load;
    (iv) Pending claims either by or against the contractor;
    (v) Contingent liabilities such as guarantees, litigation, 
environmental, or product liabilities;
    (vi) Validity of accounts receivable and actual value of inventory, 
as assets; and
    (vii) Status and aging of accounts payable.
    (10) Significant ratios such as--
    (i) Inventory to annual sales;
    (ii) Inventory to current assets;
    (iii) Liquid assets to current assets;
    (iv) Liquid assets to current liabilities;
    (v) Current assets to current liabilities; and
    (vi) Net worth to net debt.



232.172-3  Cash flow forecasts.

    (a) A contractor must be able to sustain a sufficient cash flow to 
perform the contract. Whenever there is a doubt about the sufficiency of 
a contractor's cash flow, the contracting officer should require the 
contractor to submit a cash flow forecast covering the duration of the 
contract.
    (b) A contractor's inability or refusal to prepare and provide cash 
flow forecasts or to reconcile actual cash flow with previous forecasts 
is a strong indicator of serious managerial deficiencies or potential 
contract cost or performance problems.
    (c) Single or one-time cash flow forecasts are of limited 
forecasting power. As such, they should be limited to preaward survey 
situations. Reliability of cash flow forecasts can be established only 
by comparing a series of previous actual cash flows with the 
corresponding forecasts and examining the causes of any differences.
    (d) Cash flow forecasts must--
    (1) Show the origin and use of all material amounts of cash within 
the entire business unit responsible for contract performance, period by 
period, for the length of the contract (or until the risk of a cash 
crisis ends); and
    (2) Provide an audit trail to the data and assumptions used to 
prepare it.
    (e) Cash flow forecasts can be no more reliable than the assumptions 
on which they are based. Most important of these assumptions are--
    (1) Estimated amounts and timing of purchases and payments for 
materials, parts, components, subassemblies, and services;
    (2) Estimated amounts and timing of payments for purchase or 
production of capital assets, test facilities, and tooling;
    (3) Amounts and timing of fixed cash charges such as debt 
installments, interest, rentals, taxes, and indirect costs;
    (4) Estimated amounts and timing of payments for projected labor, 
both direct and indirect;
    (5) Reasonableness of projected manufacturing and production 
schedules;
    (6) Estimated amounts and timing of billings to customers (including 
progress payments), and customer payments;
    (7) Estimated amounts and timing of cash receipts from lenders or 
other credit sources, and liquidation of loans; and

[[Page 260]]

    (8) Estimated amounts and timing of cash receipts from other 
sources.
    (f) The contracting officer should review the assumptions underlying 
the cash flow forecasts. In determining whether the assumptions are 
reasonable and realistic, the contracting officer should consult with--
    (1) The contractor;
    (2) Government personnel in the areas of finance, engineering, 
production, cost, and price analysis; or
    (3) Prospective supply, subcontract, and loan or credit sources.



232.173  Reduction or suspension of contract payments upon finding of fraud.



232.173-1  General.

    (a) 10 U.S.C. 2307(e)(2) provides for a reduction or suspension of 
further payments to a contractor when the agency head determines there 
is substantial evidence that the contractor's request for advance, 
partial, or progress payments is based on fraud.
    (b) The agency head may not delegate his or her responsibilities 
under 10 U.S.C. 2307(e) below level IV of the Executive Schedule. For 
purposes of this section, the Under Secretary of Defense (Acquisition & 
Technology) is the agency head for the defense agencies.
    (c) Authority to reduce or suspend payments under 10 U.S.C. 2307(e) 
is in addition to other Government rights, remedies, and procedures.
    (d) In accordance with 10 U.S.C. 2310(a), agency head determinations 
and decisions under this section may be made for an individual contract 
or any group of contracts affected by the fraud.
[57 FR 3359, Jan. 29, 1992, as amended at 57 FR 42632, Sept. 15, 1992; 
60 FR 61598, Nov. 30, 1995]



232.173-2  Definitions.

    As used in this section--
    (a) Remedy coordination official means the person or entity in the 
agency who coordinates within that agency the administration of 
criminal, civil, administrative, and contractual remedies resulting from 
investigations of fraud or corruption related to procurement activities.
    (b) Substantial evidence means information sufficient to support the 
reasonable belief that a particular act or omission has occurred.
[57 FR 3359, Jan. 29, 1992]



232.173-3  Responsibilities.

    (a) Agencies shall establish appropriate procedures to implement the 
policies and procedures of this section.
    (b) Government personnel shall report suspected fraud related to 
advance, partial, or progress payments in accordance with agency 
regulations.
[57 FR 3359, Jan. 29, 1992]



232.173-4  Procedures.

    (a) In any case in which an agency's remedy coordination official 
finds substantial evidence that a contractor's request for advance, 
partial, or progress payments under a contract awarded by that agency is 
based on fraud, the remedy coordination official shall recommend that 
the agency head reduce or suspend further payments to the contractor. 
The remedy coordination official shall submit to the agency head a 
written report setting forth the remedy coordination official's findings 
that support each recommendation.
    (b) Upon receiving a recommendation from the remedy coordination 
official under paragraph (a) of this subsection, the agency head shall 
determine whether substantial evidence exists that the request for 
payment under a contract is based on fraud.
    (c) If the agency head determines that substantial evidence exists, 
the agency head may reduce or suspend further payments to the contractor 
under the affected contract(s). Such reduction or suspension shall be 
reasonably commensurate with the anticipated loss to the Government 
resulting from the fraud.
    (d) In determining whether to reduce or suspend further payment(s), 
as a minimum, the agency head shall consider:
    (1) A recommendation from investigating officers that disclosure of 
the allegations of fraud to the contractor may compromise an ongoing 
investigation;
    (2) The anticipated loss to the Government as a result of the fraud;

[[Page 261]]

    (3) The contractor's overall financial condition and ability to 
continue performance if payments are reduced or suspended;
    (4) The contractor's essentiality to the national defense;
    (5) Assessment of all documentation concerning the alleged fraud, 
including documentation submitted by the contractor in its response to 
the notice required by paragraph (e) of this subsection.
    (e) Before making a decision to reduce or suspend further payments, 
the agency head shall, in accordance with agency procedures--
    (1) Notify the contractor in writing of the action proposed by the 
remedy coordination official and the reasons therefore; and
    (2) Provide the contractor an opportunity to submit information 
within a reasonable time, in response to the action proposed by the 
remedy coordination official.
    (f) When more than one agency has contracts affected by the fraud, 
the agencies shall consider designating one agency as the lead agency 
for making the determination and decision.
    (g) The agency shall retain in its files the written justification 
for each--
    (1) Decision of the agency head whether to reduce or suspend further 
payments; and
    (2) Recommendation received by an agency head in connection with 
such decision.
    (h) Not later than 180 calendar days after the date of the reduction 
or suspension action, the remedy coordination official shall--
    (1) Review the agency head's determination on which the reduction or 
suspension decision is based; and
    (2) Transmit a recommendation to the agency head as to whether the 
reduction or suspension should continue.
[57 FR 3359, Jan. 29, 1992, as amended at 57 FR 42632, Sept. 15, 1992]



232.173-5  Reporting.

    Departments and agencies, in accordance with department/agency 
procedures, shall prepare and submit to the Under Secretary of Defense 
(Acquisition & Technology), through the Director of Defense Procurement, 
annual reports (Report control symbol DD-ACQ(A) 1891) containing--
    (a) Each recommendation made by the remedy coordination official for 
payments reduction or suspension;
    (b) The actions taken on the recommendation(s), with the reasons for 
such actions; and
    (c) An assessment of the effects of each action on the Government.
[57 FR 3359, Jan. 29, 1992, as amended at 57 FR 42632, Sept. 15, 1992; 
60 FR 61598, Nov. 30, 1995]



          Subpart 232.3--Loan Guarantees for Defense Production



232.302  Authority.

    (a) The use of guaranteed loans as a contract financing mechanism 
requires the availability of certain congressional authority. The DoD 
has not requested such authority in recent years, and none is now 
available.



                     Subpart 232.4--Advance Payments



232.404  Exclusions.

    (a)(9) The requirements of FAR subpart 32.4 do not apply to 
advertisements in high school and college publications for military 
recruitment efforts under 10 U.S.C. 503 when the contract cost does not 
exceed $500.



232.409  Contracting officer action.



232.409-1  Recommendation for approval.

    To ensure uniform application of this subpart (see FAR 
32.402(e)(1)), the departmental/agency contract financing office shall 
prepare the documents required by FAR 32.409-1 (e) and (f).



232.410  Findings, determination, and authorization.

    (b) If an advance payment procedure is used without a special bank 
account, replace paragraph (a)(4) of the Findings, Determination, and 
Authorization for Advance Payments at FAR 32.410 with:

    (4) The proposed advance payment clause contains appropriate 
provisions as security

[[Page 262]]

for advance payments. These provisions include a requirement that the 
outstanding advance payments will be liquidated from cost reimbursements 
as they become due the contractor. This security is considered adequate 
to protect the interest of the Government.



232.412  Contract clause.



232.412-70  Additional clauses.

    (a) Use the clause at 252.232-7000, Advance Payment Pool, in any 
contract that will be subject to the terms of an advance payment pool 
agreement with a nonprofit organization or educational institution. 
Normally, use the clause in all cost reimbursement type contracts with 
the organization or institution.
    (b) Use the clause at 252.232-7001, Disposition of Payments, in 
contracts when payments under the contract are to be made by a 
disbursing office not designated in the advance payment pool agreement.
    (c) Use the clause at 252.232-7005, Reimbursement of Subcontractor 
Advance Payments-DoD Pilot Mentor-Protege Program, when advance payments 
will be provided by the contractor to a subcontractor pursuant to an 
approved mentor-protege agreement (See subpart 219.71).
[56 FR 36409, July 31, 1991, as amended at 56 FR 67217, Dec. 30, 1991]



232.470  Advance payment pool.

    (a) An advance payment pool agreement--
    (1) Is a means of financing the performance of more than one 
contract held by a single contractor;
    (2) Is especially convenient for the financing of cost-type 
contracts with nonprofit educational or research institutions for 
experimental or research and development work when several contracts 
require financing by advance payments. When appropriate, pooled advance 
payments may also be used to finance other types of contracts held by a 
single contractor; and
    (3) May be established--
    (i) Without regard to the number of appropriations involved;
    (ii) To finance contracts for one or more department(s) or 
contracting activity(ies); or
    (iii) In addition to any other advance payment pool agreement at a 
single contractor location when it is more convenient or otherwise 
preferable to have more than one agreement.



             Subpart 232.5--Progress Payments Based on Costs



232.501  General.

    In DoD, customary progress payments may be either uniform or 
flexible (FAR 32.501-1(a)). See also 232.501-1 and 232.502-1-71.



232.501-1  Customary progress payment rates.

    (a)(i) The customary uniform progress payment rate for DoD contracts 
is 75 percent for large businesses, 90 percent for small businesses, and 
95 percent for small disadvantaged businesses.
    (ii) The progress payment rates applicable to foreign military sale 
requirements are the same rates applicable to DoD requirements.
    (iii) For customary flexible progress payments, determine the 
appropriate rate using the appropriate CASH computer program (see 
232.502-1-71).
[56 FR 36409, July 31, 1991, as amended at 56 FR 67217, Dec. 30, 1991; 
58 FR 62046, Nov. 24, 1993]



232.501-2  Unusual progress payments.

    (a) Unusual progress payment arrangements require the advance 
approval of the USD(A&T)DP. Contracting officers shall submit all 
unusual progress payment requests to the department or agency contract 
financing office for approval, coordination with the Contract Finance 
Committee (232.171), and submission to the USD(A&T)DP.
[56 FR 36409, July 31, 1991, as amended at 60 FR 61598, Nov. 30, 1995]



232.501-3  Contract price.

    (b) The contracting officer may approve progress payments when the 
contract price exceeds the funds obligated under the contract; provided, 
the contract contains an appropriate Limitation of Funds clause. 
However, the contracting officer shall limit such payments to the lesser 
of--

[[Page 263]]

    (i) The applicable rate (i.e., the lower of the progress payment 
rate, the liquidation rate, or the loss-ratio adjusted rate); or
    (ii) 100 percent of the funds obligated.



232.502  Preaward matters.



232.502-1  Use of customary progress payments.

    (b)(1) If the contractor is a small disadvantaged business, progress 
payments may be provided when the contract will involve $50,000 or more.



232.502-1-70  Customary foreign military sale progress payments.

    (a) Foreign military sale (FMS) progress payments apply to DoD 
acquisitions on behalf of foreign governments or international 
organizations (Section 22 of the Arms Export Control Act).
    (b) FMS progress payments do not apply to acquisitions--
    (1) For replenishing U.S. Government inventories or stocks; and
    (2) Made under DoD cooperative logistic support arrangements.



232.502-1-71  Customary flexible progress payments.

    (a) General. (1) Progress payments reduce contractor investment in 
work in process inventory. In addition to progress payments, other 
factors influence a contractor's actual investment in work in process 
inventory, e.g., delivery schedules, cash management practices, and 
Government payment practices.
    (2) Progress payment amounts that are determined by using customary 
uniform rates are insensitive to the other factors influencing 
contractor investment in work in process inventory. Consequently, 
contractor investments in work in process inventory vary among 
contractors and contracts.
    (3) Flexible progress payment rates are designed to tailor the 
progress payment rate to more closely match the contractor's cash needs 
for financing contract performance. The flexible rate is expressed as a 
percentage which is applied to costs to determine the amount payable as 
a progress payment, in the same manner as customary uniform rates are 
applied.
    (4) For flexible progress payments, cash needs are measured and 
projected based on the investment required for the work in process 
inventory over the life of the contract. Total investment is measured by 
a weighted average of total costs paid by the contractor. The 
contractor's investment is the weighted average of the amount not paid 
by the Government.
    (5) DoD, as a matter of policy, requires contractors to retain a 
minimum investment level in work in process inventory over the life of 
the contract (see Table 32-1, Customary Uniform Progress Payment Rates). 
This minimum investment level is based on the customary uniform progress 
payment rate and its related investment percentage. Accordingly, the DoD 
will make progress payments at a rate (expressed as a whole number) that 
is the highest rate which yields a corresponding investment by the 
contractor in work in process inventory of not less than the minimum 
investment percentage.
    (6) The customary flexible progress payment rate will be determined 
by using the DoD Cash Flow Computer Model. The rate computed shall not--
    (i) Exceed 100 percent; or
    (ii) Be less than the customary uniform progress payment rate that 
would have been applied to the contract in the absence of customary 
flexible progress payments.
    (7) Table 32-1, Customary Uniform Progress Payment Rates, shows the 
customary uniform progress payment rates for other than small or small 
disadvantaged businesses (see also 232.501-1), minimum contractor 
investment (except for contracts funded with FY87 appropriations), and 
the applicable DoD Cash Flow Computer Model. For contracts or line items 
that are funded with FY87 appropriations, a contractor must retain at 
least a 25 percent investment in work in process inventory over the life 
of the contract or over the contract performance period applicable to 
the contract line item.

[[Page 264]]



                              Table 32-1--Customary Uniform Progress Payment Rates                              
----------------------------------------------------------------------------------------------------------------
                                                 Uniform                                                        
             Contract award date                   rate      Investment              Cash flow model            
                                                percentage   percentage                                         
----------------------------------------------------------------------------------------------------------------
Prior to May 1, 1985.........................           90            5  CASH-II                                
May 1, 1985 through October 17, 1986.........           80           15  CASH-III                               
October 18, 1986 through September 30, 1988..           75           25  CASH-IV                                
October 1, 1988 through June 30, 1991........           80           20  CASH-V                                 
After June 30, 1991*.........................           85           20  CASH-VI**                              
----------------------------------------------------------------------------------------------------------------
* Flexible progress payments shall not be used for contracts awarded as a result of solicitations issued on or  
  after November 11, 1993.                                                                                      
** See paragraph (b)(5)(ii) for implementation instructions.                                                    

    (b) Using customary flexible progress payments. (1) Use a flexible 
progress payment rate at the time of award or definitization instead of 
the customary uniform rate if--
    (i) The contractor requests flexible progress payments;
    (ii) The contractor agrees to the requirements of this section;
    (iii) The contract contains the clause at FAR 52.232-16, Progress 
Payments. However, small business contractors may get flexible progress 
payments if they agree to use the clause at FAR 52.232-16 without its 
Alternate I; and
    (iv) The criteria in paragraphs (b)(2) and (3) of this subsection 
are met.
    (2) Do not use flexible progress payments for--
    (i) Sealed bid contracts;
    (ii) Undefinitized contract actions; or
    (iii) Contracts awarded and performed entirely outside of the United 
States, its possessions or territories.
    (3) Contractors who submit cost or pricing data, as defined in FAR 
15.801, for negotiated fixed-price contracts in excess of $1 million may 
request flexible progress payments.
    (4) Subcontractors who request flexible progress payments, meet the 
criteria in paragraph (b)(3) of this subsection, and agree to the 
requirements of this subsection are to receive flexible progress 
payments. The prime contractor determines the flexible progress payment 
rate without regard to the rate in the prime contract. In determining 
the appropriate customary flexible rate, the prime contractor will use 
the DoD Cash Flow Computer Model and review the cash flow data provided 
by the subcontractor.
    (5) Prior to contract award, the contracting officer shall determine 
the customary flexible progress payment rate by applying the appropriate 
version of the DoD Cash Flow Computer Model.
    (i) The model takes into account key cash flow factors including 
contract cost profile, delivery schedules, subcontractor progress 
payments, liquidation rates, and payment/reimbursement cycles. For 
contracts funded with FY87 appropriations, use the CASH-IV model.
    (ii) From time to time the Department of Defense may change the 
uniform progress payment rate and/or the minimum contractor investment 
rate, which may have an effect upon the variables within the DoD Cash 
Flow Computer Program. In order to avoid frequent revision and 
redistribution of the computer program, the program is designed to 
permit use of either a particular model (CASH-II, CASH-V, etc.) or a 
program option to input the equivalent uniform progress payment rate and 
minimum contractor investment rate (90%/5%, 80%/20%, etc.), as shown in 
the table at (a)(7). Either method will result in the same flexible 
progress payment rate calculation. When the Cash Flow Computer Program 
does not contain the model needed for a particular situation, the 
contracting officer shall use the program option.
    (6) If the contractor requests flexible progress payments after 
contract award or definitization, the contracting officer may, if 
warranted, grant their use. However, the contractor must provide 
adequate new consideration (see FAR 32.501-4).
    (c) Contractor cash flow and cost information. (1) Contractors shall 
furnish to the contracting officer cash flow data in the form and 
context specified for use in the DoD Cash Flow Computer Model. 
Contractors should furnish cash flow data prior to the start of 
negotiations. This data includes--

[[Page 265]]

    (i) Actual and projected incurred cost, broken down by element of 
cost and by month, for the duration of the contract;
    (ii) Float times for each element of cost;
    (iii) Dates and lag times of actual and projected progress payment 
and delivery payment receipts; and
    (iv) Associated contract price and profit percentage.
    (2) Contracting officers shall verify the cash flow data using the 
procedures normally used to verify contractor cost and pricing data, and 
establish the customary flexible progress payment rate during the 
negotiation of the contract price.
    (3) If any customary flexible progress payment rate is later 
determined to be overstated because factual data submitted in support of 
the rate computation was not current, accurate, or complete at the time 
the rate was established, the flexible progress payment clause at 
252.232-7003 provides for--
    (i) Reduction of the flexible progress payment rate; and
    (ii) Contractor payment of interest.
    (4) The contracting officer will assess the interest charge on the 
amount of the overpayment resulting from facts that were not current, 
accurate, or complete, whether or not the overpayment has been 
liquidated. Calculate the interest from the date of the overpayment to 
the date of liquidation of the overpayment. In determining the amount of 
interest, the contracting officer may determine an average overpayment 
amount and duration as the basis for the interest computation. Interest 
rates change periodically; therefore, calculate average amounts and 
durations separately for each interest period that has a different 
interest rate.
    (5) Administrative contracting officers are encouraged to establish 
advance agreements at contractor locations for payment float and lag 
times which are common to several contracts. Float and lag times may 
vary significantly from one contract to another due to variances in 
efficiency at different payment offices or due to differing procedures 
for high dollar versus low dollar value contracts. It may, therefore, be 
appropriate to establish advance agreements on several different float 
and lag profiles to suit different contract situations.
    (d) Rate review. (1) The flexible progress payment clause at 
252.232-7003 provides for redetermination of the customary flexible 
progress payment rate whenever the computed investment percentage is 
more than two points above or below the specific minimum investment in 
work in process inventory (see Table at 232.502-1-71(a)(7)). When such a 
redetermination is made--
    (i) Apply the new customary flexible progress payment rate to the 
next contractor progress payment request; and
    (ii) Adjust the unliquidated progress payment balance.
    (2) Either the Government or the contractor may request a rate 
review at any time to determine if the computed investment percentage in 
work in process inventory is outside of the investment tolerance in 
paragraph (d)(1) of this subsection. For contracts funded with FY87 
appropriations, the investment range is 23 to 27 percent with a target 
of 25 percent.
    (3) The administrative contracting officer shall assess changes in 
the following factors during each periodic review required by FAR 
32.503-5 and shall review the customary flexible progress payment rate 
whenever there has been--
    (i) A significant change in the float or lag factors;
    (ii) A significant change in the delivery schedule; or
    (iii) Substantial work added to or deleted from the contract.
    (e) Letter contracts and undefinitized orders. When flexible 
progress payments are contemplated for use on a definitized contract 
superseding a letter contract or an unpriced BOA order, the applicable 
uniform customary progress payment rate shall be used until 
definitization. The flexible progress payment rate shall be determined 
by the contracting officer before definitizing the contract or order.
    (f) Availability of CASH program and user's guide. The flexible 
progress payment program CASH and the user's

[[Page 266]]

guide are available to offerors and contractors from the contracting 
officer.
[56 FR 36409, July 31, 1991, as amended at 56 FR 67217, Dec. 30, 1991; 
58 FR 62046, Nov. 24, 1993; 58 FR 64353, Dec. 6, 1993; 62 FR 40473, July 
29, 1997]



232.502  Contract clauses.



232.502-4-70  Additional clauses.

    (a) Use the clause at 252.232-7002, Progress Payments for Foreign 
Military Sales Acquisitions, in any contract that provides for progress 
payments and contains foreign military sale requirements.
    (b) Use the clauses at 252.232-7003, Flexible Progress Payments, and 
252.232-7004, DoD Progress Payment Rates, in contracts using a customary 
flexible progress payment rate.
    (c) Use the clause at 252.232-7004, DoD Progress Payment Rates, in 
addition to the clauses prescribed at FAR 32.502-4.
[56 FR 36409, July 31, 1991, as amended at 56 FR 67217, Dec. 30, 1991]



232.503  Postaward matters.



232.503-6  Suspension or reduction of payments.

    (b) Contractor noncompliance. See also 242.7503.
    (g) Loss contracts. Use the following loss ratio adjustment 
procedures for making adjustments required by FAR 32.503-6(f) and (g)--
    (i) Except as provided in paragraph (g)(ii) of this subsection, the 
contracting officer shall prepare a supplementary analysis of the 
contractor's request for progress payments and calculate the loss ratio 
adjustment using the procedures in FAR 32.503-6(g).
    (ii) The contracting officer may request the contractor to prepare 
the supplementary analysis as an attachment to the progress payment 
request when the contracting officer determines that the contractor's 
methods of estimating the ``Costs to Complete'' are reliable, accurate, 
and not susceptible to improper influences.
    (iii) To maintain an audit trail and permit verification of 
calculations, do not make the loss ratio adjustments by altering or 
replacing data on the contractor's original request for progress payment 
(SF 1443, Contractor's Request for Progress Payment, or computer 
generated equivalent).
[56 FR 36409, July 31, 1991, as amended at 60 FR 29499, June 5, 1995]



232.503-15  Application of Government title terms.

    (d) An administrative contracting officer (ACO) determination that 
the contractor's material management and accounting system conforms to 
the standard at 252.242-7004(f)(7) constitutes the contracting officer 
approval requirement of FAR 32.503-15(d). Prior to granting blanket 
approval of cost transfers between contracts, the ACO should determine 
that--
    (i) The contractor retains records of the transfer activity that 
took place in the prior month;
    (ii) The contractor prepares, at least monthly, a summary of the 
transfer activity that took place in the prior month; and
    (iii) The summary report includes as a minimum, the total number and 
dollar value of transfers.
[56 FR 36409, July 31, 1991, as amended at 57 FR 42632, Sept. 15, 1992]



                      Subpart 232.6--Contract Debts



232.605  Responsibilities and cooperation among Government officials.

    (b) Disbursing officers are those officials designated to make 
payments under a contract or to receive payments of amounts due under a 
contract. At installations where integrated accounting is in effect, the 
finance and accounting officer is a disbursing officer. The disbursing 
officer is responsible for determining the amount and collecting 
contract debts whenever overpayments or erroneous payments have been 
made. The disbursing officer also has primary responsibility when the 
amounts due and dates for payment are contained in the contract, and a 
copy of the contract has been furnished to the disbursing officer with 
notice to collect as amounts become due.

[[Page 267]]



232.606  Debt determination and collection.

    (c)(9)(vii) Upon transfer of a case to the contract financing 
office, the contracting officer shall close the debt record by reference 
to the date of transfer.



232.610  Demand for payment of contract debt.

    (a)(i) For contract debts resulting from other than a termination 
for default, the office which first determines an amount due, whether it 
be the contract administration office, the contracting office, the 
disbursing office, or the selling office/agency, shall--
    (A) Make a demand for payment; and
    (B) Provide a copy of the demand to the payment office cited in the 
contract.
    (ii) For contract debts resulting from a termination for default, 
the contracting officer shall make the demand and direct the debtor to 
make such payment to the designated office.
    (b)(3) The contracting office shall forward deferment requests to 
the contract financing office of the contracting department or agency 
for a decision on granting the deferment.



232.616  Compromise actions.

    Only the department/agency contract financing offices (232.108(1)) 
are authorized to compromise debts covered by this subpart.



232.617  Contract clause.

    (a) The DoD Contract Finance Committee, with the approval of the 
USD(A&T)DP, may exempt the contracts in FAR 32.617(a) (2) through (5) 
and other contracts, in exceptional circumstances, from the 
administrative interest charges required by this subpart.
    (a)(7) Other exceptions--
    (A) Contracts for instructions of military or ROTC personnel at 
civilian schools, colleges, and universities;
    (B) Basic agreements with telephone companies for communications 
services and facilities, and purchases under such agreements; and
    (C) Transportation contracts with common carriers for common carrier 
services.
[56 FR 36409, July 31, 1991, as amended at 60 FR 61598, Nov. 30, 1995]



232.670  Transfer of responsibility for debt collection.

    Disbursing officers will transfer responsibility for debt collection 
to departmental/agency contract financing offices in accordance with 
comptroller regulations. Notwithstanding the transfer of the debt 
collection responsibility, contracting officers shall continue to 
provide assistance as requested by the debt collection office.



232.671  Bankruptcy reporting.

    (a) For those debts covered by this subpart, the department or 
agency which awarded the contract shall furnish the Department of 
Justice any claims in bankruptcy, insolvency, or in proceedings for 
reorganization or arrangement. Furnish claims which--
    (1) Have been transferred to a contract financing office;
    (2) Are on the way to a contract financing office at the inception 
of bankruptcy or insolvency proceedings;
    (3) Are pending and not forwarded to a contract financing office at 
the inception of bankruptcy or insolvency proceedings; and
    (4) Are the result of bankruptcy or insolvency proceedings.
    (b) The contract financing office or other office designated within 
a department or agency will furnish proof of claims to the Department of 
Justice.
    (c) The office of origin of a debt will provide, as soon as 
possible, information on a bankruptcy, insolvency, reorganization, or 
rearrangement to the office designated within a department/agency to 
receive this information.
    (d) The information and proof of claim requirements in paragraphs 
(b) and (c) of this section do not apply to debts of less than $600.



                     Subpart 232.7--Contract Funding

    Source:  58 FR 46092, Sept. 1, 1993, unless otherwise noted.

[[Page 268]]



232.702  Policy.

    Fixed-price contracts shall be fully funded except as permitted by 
232.703-1.



232.703  Contract funding requirements.



232.703-1  General.

    (1) A fixed-price contract may be incrementally funded only if--
    (i) The contract is funded with research and development 
appropriations;
    (ii) Congress has otherwise incrementally appropriated program 
funds; or
    (iii) The head of the contracting activity approves the use of 
incremental funding for either base services contracts or hazardous/
toxic waste remediation contracts.
    (2) Incrementally funded fixed-price contracts shall be fully funded 
as soon as practicable after full funding is available.



232.703-70  Military construction appropriations act restriction.

    Annual military construction appropriations acts restrict the use of 
funds appropriated by the acts for payments under cost-plus-fixed-fee 
contracts (see 216.306(c)).
[61 FR 7744, Feb. 29, 1996]



232.704  Limitation of cost or funds.



232.704-70  Incrementally funded fixed-price contracts.

    (a) Upon receipt of the contractor's notice under paragraph (c) of 
the clause at 252.232-7007, Limitation of Government's Obligation, the 
contracting officer shall promptly provide written notice to the 
contractor that the Government is--
    (1) Allotting additional funds for continued performance and 
increasing the Government's limitation of obligation in a specified 
amount;
    (2) Terminating the contract; or
    (3) Considering whether to allot additional funds; and
    (i) The contractor is entitled by the contract terms to stop work 
when the Government's limitation of obligation is reached; and
    (ii) Any costs expended beyond the Government's limitation of 
obligation are at the contractor's risk.
    (b) Upon learning that the contract will receive no further funds, 
the contracting officer shall promptly give the contractor written 
notice of the Government's decision and terminate for the convenience of 
the Government.
    (c) The contracting officer shall ensure that, in accordance with 
paragraph (b) of the clause at 252.232-7007, Limitation of Government's 
Obligation, sufficient funds are allotted to the contract to cover the 
total amount payable to the contractor in the event of termination for 
the convenience of the Government.



232.705  Contract clauses.



232.705-70  Clause for limitation of Government's obligation.

    Use the clause at 252.232-7007, Limitation of Government's 
Obligation, in solicitations and resultant incrementally funded fixed-
price contracts. The contracting officer may revise the contractor's 
notification period, in paragraph (c) of the clause, from ``ninety'' to 
``thirty'' or ``sixty'' days, as appropriate.



                   Subpart 232.8--Assignment of Claims



232.803  Policies.

    (b) Only contracts for personal services may prohibit the assignment 
of claims.
    (d) Pursuant to Section 3737(e) of the Revised Statutes (41 U.S.C. 
15), and in accordance with Presidential delegation dated October 3, 
1995, Secretary of Defense delegation dated February 5, 1996, and Under 
Secretary of Defense for Acquisition and Technology delegation dated 
February 23, 1996, the Director of Defense Procurement determined on May 
10, 1996, that a need exists for DoD to agree not to reduce or set off 
any money due or to become due under the contract when the proceeds 
under the contract have been assigned in accordance with the Assignment 
of Claims provision of the contract. This determination was published in 
the Federal Register on June 11, 1996, as required by law. Nevertheless, 
if departments/agencies decide it is in the Government's interests, or 
if the contracting officer makes a determination

[[Page 269]]

in accordance with FAR 32.803(d) concerning a significantly indebted 
offeror, they may exclude the no-setoff commitment.
[56 FR 36409, July 31, 1991, as amended at 61 FR 50454, Sept. 26, 1996]



232.805  Procedure.

    (b) The assignee shall forward--
    (i) To the administrative contracting officer (ACO), a true copy of 
the instrument of assignment and an original and three copies of the 
notice of assignment. The ACO shall acknowledge receipt by signing and 
dating all copies of the notice of assignment and shall--
    (A) File the true copy of the instrument of assignment and the 
original of the notice in the contract file;
    (B) Forward two copies of the notice to the disbursing officer of 
the payment office cited in the contract;
    (C) Return a copy of the notice to the assignee; and
    (D) Advise the contracting officer of the assignment.
    (ii) To the surety or sureties, if any, a true copy of the 
instrument of assignment and an original and three copies of the notice 
of assignment. The surety shall return three acknowledged copies of the 
notice to the assignee, who shall forward two copies to the disbursing 
officer designated in the contract.
    (iii) To the disbursing officer of the payment office cited in the 
contract, a true copy of the instrument of assignment and an original 
and one copy of the notice of assignment. The disbursing officer shall 
acknowledge and return to the assignee the copy of the notice and shall 
file the true copy of the instrument and original notice.



232.806  Contract clause.

    (a)(1) Use the clause at 252.232-7008, Assignment of Claims 
(Overseas), instead of the clause at FAR 52.232-23, Assignment of 
Claims, in solicitations and contracts when contract performance will be 
in a foreign country.
    (2) Use Alternate I with the clause at FAR 52.232-23, Assignment of 
Claims, unless otherwise authorized under 232.803(d).
[62 FR 34126, June 24, 1997]



                      Subpart 232.9--Prompt Payment



232.903  Policy.

    DoD policy is to assist small disadvantaged business concerns by 
paying them as quickly as possible after invoices are received and 
before normal payment due dates established in the contract (see 
232.905(2)).



232.905  Invoice payments.

    (1) In most cases, Government acceptance or approval can occur 
within the 7 day constructive acceptance period specified in the FAR 
Prompt Payment clauses. Government payment of construction progress 
payments can, in most cases, be made within the 14 day period allowed by 
the Prompt Payment for Construction Contracts clause. While the 
contracting officer may specify a longer period because the period 
specified in the contract is not reasonable or practical, such change 
should be coordinated with the Government offices responsible for 
acceptance or approval and for payment. Reasons for specifying a longer 
period include but are not limited to: the nature of the work or 
supplies or services, inspection or testing requirements, shipping and 
acceptance terms, and resources available at the acceptance activity. A 
constructive acceptance period of less than the cited 7 or 14 days is 
not authorized.
    (2) Designated payment offices are encouraged to pay small 
disadvantaged business (SDB) concerns as quickly as possible after 
invoices are received and before normal payment due dates established in 
the contract. The restrictions of FAR 32.903 prohibiting early payment 
do not apply to invoice payments made to SDBs. Contractors shall not, 
however, be entitled to interest penalties if invoice payments are not 
made before the normal payment due dates established in the contract.
    (f)(6) DoD Manual 4000.25-5-M, Military Standard Contract 
Administration Procedures (MILSCAP), authorizes electronic signature of 
receiving reports.

[[Page 270]]



232.906  Contract financing payments.

    (a)(i) DoD policy is to make contract financing payments as quickly 
as possible. Generally, the contracting officer shall insert the 
standard due dates of 7 days for progress payments and 14 days for 
interim payments on cost type contracts in subparagraphs (b)(2) of the 
Prompt Payment clauses at FAR 52.232-25, 52.232-26, and 52.232-27.
    (ii) The contracting officer should coordinate payment terms with 
offices that will be involved in the payment process to ensure that 
terms specified can be met. Where justified, the contracting officer may 
insert a due date greater than but not less than the standard. In 
determining payment terms, consider--
    (A) Geographical separation;
    (B) Workload;
    (C) Contractor ability to submit a proper request; and
    (D) Other factors that could affect timing of payment.



232.970  Payment of subcontractors.



232.970-1  Subcontractor assertions of nonpayment.

    (a) In accordance with Public Law 102-190, title VIII, section 
806(a)(4), upon the assertion by a subcontractor or supplier of a DoD 
contractor that the subcontractor or supplier has not been paid in 
accordance with the payment terms of the subcontract, purchase order, or 
other agreement with the prime contractor, the contracting officer may 
determine--
    (1) For a construction contract, whether the contractor has made--
    (i) Progress payments to the subcontractor or supplier in compliance 
with chapter 39 of title 31, United States Code (Prompt Payment Act);
    (ii) Final payment to the subcontractor or supplier in compliance 
with the terms of the subcontract, purchase order, or other agreement 
with the prime contractor;
    (2) For a contract other than construction, whether the contractor 
has made progress payments, final payments, or other payments to the 
subcontractor or supplier in compliance with the terms of the 
subcontract, purchase order, or other agreement with the prime 
contractor;
    (3) For any contract, whether the contractor's certification of 
payment of a subcontractor or supplier accompanying its payment request 
to the Government is accurate.
    (b) If, in making the determination in paragraphs (a) (1) and (2) of 
this subsection, the contracting officer finds the prime contractor is 
not in compliance, the contracting officer may--
    (1) Encourage the contractor to make timely payment to the 
subcontractor or supplier; or
    (2) If authorized by the applicable payment clauses, reduce or 
suspend progress payments to the contractor.
    (c) If the contracting officer determines that a certification 
referred to in (a)(3) of this subsection is inaccurate in any material 
respect, the contracting officer shall initiate administrative or other 
remedial action.
[57 FR 42707, Sept. 16, 1992]



232.970-2  Subcontractor requests for information.

    (a) In accordance with Public Law 102-190, title VIII, section 
806(a)(1), upon the request of a subcontractor or supplier under a DoD 
contract, the contracting officer shall promptly advise the 
subcontractor or supplier as to--
    (1) Whether the prime contractor has submitted requests for progress 
payments or other payments under the contract to DoD; and
    (2) Whether final payment has been made by the DoD to the prime 
contractor.
    (b) This subsection does not apply to matters that are--
    (1) Specifically authorized under criteria established by an 
Executive Order to be kept secret in the interest of national defense or 
foreign policy; and
    (2) Properly classified pursuant to such Executive Order (see 5 
U.S.C. 552(b)(1)).
[57 FR 42708, Sept. 16, 1992]



PART 233--PROTESTS, DISPUTES, AND APPEALS--Table of Contents




Sec.

                   Subpart 233.2--Disputes and Appeals

233.204  Policy.
233.210  Contracting officer's authority.

[[Page 271]]

233.215  Contract clause.
233.215-70  Additional contract clause.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36416, July 31, 1991, unless otherwise noted.



                   Subpart 233.2--Disputes and Appeals



233.204  Policy.

    When it would be helpful in reviewing the current claim, the 
contracting officer should get information on claims previously filed by 
the contractor with other contracting officers.



233.210  Contracting officer's authority.

    DFARS 243.105(a) limits contracting officer authority.



233.215  Contract clause.

    Use Alternate I of the clause at FAR 52.233-1, Disputes, when--
    (1) The acquisition is for--
    (i) Aircraft
    (ii) Spacecraft and launch vehicles
    (iii) Naval vessels
    (iv) Missile systems
    (v) Tracked combat vehicles
    (vi) Related electronic systems;
    (2) The contracting officer determines that continued performance 
is--
    (i) Vital to the national security, or
    (ii) Vital to the public health and welfare; or
    (3) The head of the contracting activity determines that continued 
performance is necessary pending resolution of any claim that might 
arise under or be related to the contract.
[56 FR 36416, July 31, 1991. Redesignated at 62 FR 34126, June 24, 1997]



233.215-70  Additional contract clause.

    Use the clause at 252.233-7001, Choice of Law (Overseas), in 
solicitations and contracts when contract performance will be outside of 
the United States, it possessions, and Puerto Rico, unless otherwise 
provided for in a government-to-government agreement.
[62 FR 34126, June 24, 1997]

[[Page 272]]



             SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING





PART 234--MAJOR SYSTEM ACQUISITION--Table of Contents




Sec.
234.001  Definitions.
234.003  Responsibilities.
234.005  General requirements.
234.005-70  Earned value management systems.
234.005-71  Solicitation provision and contract clause.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.



234.001  Definitions.

    Systems means a combination of elements that will function together 
to produce the capabilities required to fulfill a mission need.
    Systems acquisition means the design, development, and production of 
new systems. It also includes modifications to existing systems that 
involve redesign of the systems or subsystems.
[60 FR 61598, Nov. 30, 1995]



234.003  Responsibilities.

    DoD 5000.1, Defense Acquisition, and DoD 5000.2-R, Mandatory 
Procedures for Major Defense Acquisition Programs (MDAPs) and Major 
Automated Information System (MAIS) Acquisition Programs, contain the 
DoD implementation of OMB Circular A-109.
[62 FR 34126, June 24, 1997]



234.005  General requirements.



234.005-70  Earned value management systems.

    When an offeror provides an earned value management system (EVMS) 
plan as part of its proposal in accordance with the provision at 
252.234-7000, the contracting officer shall forward a copy of the plan 
to the cognizant administrative contracting officer (ACO). The procuring 
contracting officer shall obtain the assistance of the ACO in 
determining the adequacy of the proposed EVMS plan.
[62 FR 9991, Mar. 5, 1997]



234.005-71  Solicitation provision and contract clause.

    When the Government requires contractor compliance with DoD earned 
value management system criteria--
    (a) Use the provision at 252.234-7000, Notice of Earned Value 
Management System, in solicitations; and
    (b) Use the clause at 252.234-7001, Earned Value Management System, 
in solicitations and contracts.
[62 FR 9991, Mar. 5, 1997; 62 FR 11953, Mar. 13, 1997]



PART 235--RESEARCH AND DEVELOPMENT CONTRACTING--Table of Contents




Sec.
235.001  Definitions.
235.002  General.
235.006  Contracting methods and contract type.
235.007  Solicitations.
235.010  Scientific and technical reports.
235.015  Contracts for research with educational institutions and 
          nonprofit organizations.
235.015-70  Special use allowances for research facilities acquired by 
          educational institutions.
235.015-71  Short form research contract (SFRC).
235.016  Broad agency announcement.
235.017  Federally Funded Research and Development Centers.
235.017-1  Sponsoring agreements.
235.070  Indemnification against unusually hazardous risks.
235.070-1  Indemnification under research and development contracts.
235.070-2  Indemnification under contracts involving both research and 
          development and other work.
235.070-3  Contract clauses.
235.071  Additional contract clauses.

    Subpart 235.70--Research and Development Streamlined Contracting 
                            Procedures--Test

235.7000  Scope.
235.7001  Definitions.
235.7002  Applicability.
235.7003  [Reserved]
235.7004  The research and development streamlined solicitation (RDSS).
235.7004-1  General.
235.7004-2  Solicitation procedures.
235.7004-3  Proposal evaluation and contract award procedures.

[[Page 273]]

235.7005  The research and development streamlined contract (RDSC).
235.7006  The research and development streamlined contracting format.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36416, July 31, 1991, unless otherwise noted.



235.001  Definitions.

    The following terms are defined in DoD 7000.14-R, Financial 
Management Regulation. As used in this part--
    Advanced development means all effort directed toward projects which 
have moved into the development of hardware for test. The prime proof of 
this type of effort is proof of design concept rather than the 
development of hardware. Projects in this category have a potential 
military application.
    Basic research means all effort of scientific study and 
experimentation directed toward increasing knowledge and understanding 
in those fields of the physical, engineering, environmental, and life 
sciences related to long-term national security needs, It provides 
fundamental knowledge required for the solution of military problems. It 
forms a part of the base for--
    (1) Subsequent exploratory and advanced developments in defense 
related technologies; and
    (2) New or improved military functional capabilities in areas such 
as communications, detection, tracking, surveillance, propulsion, 
mobility, guidance and control, navigation, energy conversion, materials 
and structures, and personnel support.
    Demonstration/validation means those efforts necessary to evaluate 
integrated technologies in as realistic an operating environment as 
possible to assess the performance or cost reduction potential of 
advanced technology. The demonstration/validation phase is system 
specific and also includes advanced technology demonstrations that help 
expedite technology transition from the laboratory to operational use.
    Engineering and manufacturing development means those projects in 
full-scale engineering development but which have not yet received 
approval for production or had production funds included in the DoD 
budget submission for the budget or subsequent fiscal year. This area is 
characterized by major line item projects where program control is 
exercised by review of individual projects.
    Exploratory development means all effort directed toward the 
solution of specific military problems, short of major development 
projects. This type of effort may vary from fairly fundamental applied 
research to quite sophisticated bread-board hardware, study, 
programming, and planning efforts. It would thus include studies, 
investigations, and minor development effort. The dominant 
characteristic of this category of effort is that it be pointed toward 
specific military problem areas with a view toward developing and 
evaluating the feasibility and practicability of proposed solutions and 
determining their parameters.
    Management and support means all effort directed toward support of 
installations and operations required for general research and 
development use. This includes military construction of a general nature 
unrelated to specific programs, maintenance support of laboratories, 
operation and maintenance of test ranges, and maintenance of test 
aircraft and ships. Costs of laboratory personnel, either in-house or 
contracted, would be assigned to projects or as a line item in the 
research, exploratory development, or advanced development program 
areas, as appropriate. Management and support is not ``research and 
development'' except in exceptional cases. For example, construction of 
recreational facilities at an installation is not ``research and 
development'' work, even if the installation is used only for research 
and development work.
    Operational system development means those projects still in full-
scale engineering development, but which have received approval for 
production through Defense Acquisition Board or other action, or 
production funds have been included in the DoD budget submission for the 
budget or subsequent year. All items in this area are major line item 
projects which appear as RDT&E costs of weapons systems elements in 
other programs. Program control is exercised by review of the individual 
projects.

[[Page 274]]

    Research and development ordinarily covers only the following 
categories--
    (1) Basic research;
    (2) Exploratory development;
    (3) Advanced development;
    (4) Demonstration/validation;
    (5) Engineering and manufacturing development; and
    (6) Operational system development.
[60 FR 29499, June 5, 1995]



235.002  General.

    Contracts for research and development may not be performed over a 
period exceeding ten years from the date of initial award, unless the 
department or agency notifies Congress (10 U.S.C. 2352).
    (1) The head of the agency shall notify Congress whenever--
    (i) It is expected, at the time of award, or as a result of a 
modification, that the period of performance will exceed ten years from 
the initial award date; or
    (ii) Performance has extended beyond ten years from the initial 
award date and no notice has otherwise been provided to Congress.
    (2) The notice shall--
    (i) Identify the contract;
    (ii) State the initial award date;
    (iii) State the expected period of performance; and
    (iv) Be submitted not later than 30 days after--
    (A) The initial award date or date of modification, as applicable; 
or
    (B) The date on which performance exceeds ten years if no prior 
notice was given.
[57 FR 14994, Apr. 23, 1992]



235.006  Contracting methods and contract type.

    (a) All contracts under the Manufacturing Technology Program (see 
DoDI 4200.15, Manufacturing Technology Program) shall be awarded using 
competitive procedures (10 U.S.C. 2525).
    (b)(i) A fixed-price type contract shall not be awarded for a 
development program effort unless--
    (A) The level of program risk permits realistic pricing;
    (B) The use of a fixed-price type contract permits an equitable and 
sensible allocation of program risk between the Government and the 
contractor; and
    (C) A written determination that the criteria of paragraphs 
(b)(i)(A) and (B) of this section have been met is executed--
    (1) By the Under Secretary of Defense (Acquisition and Technology) 
(USD(A&T)) for--
    (i) Research and development for non-major systems, if the contract 
is over $25 million;
    (ii) The lead ship of a class;
    (iii) The development of a major system (as defined in FAR 2.101) or 
subsystem thereof, if the contract is over $25 million, or is over $10 
million and is funded with FY90 funds (Pub. L. 101-165, section 9048), 
FY91 funds (Pub. L. 101-511, section 8038), FY92 funds (Pub. L. 102-172, 
section 8037), or FY93 funds (Pub. L. 102-396, section 9037).
    (2) By the contracting officer for any development not covered by 
paragraph (b)(i)(C)(1) of this section.
    (ii) The contracting officer must obtain USD(A&T) approval of the 
Government's prenegotiation position before negotiations begin and must 
obtain USD(A&T) approval of the negotiated agreement with the contractor 
before the agreement is executed for any action that is--
    (A) An increase of more than $250 million in the price or ceiling 
price of a fixed-price type development contract, or a fixed-price type 
contract for the lead ship of a class;
    (B) A reduction in the amount of work under a fixed-price type 
development contract or a fixed-price type contract for the lead ship of 
a class, when the value of the work deleted is $100 million or more; or
    (C) A repricing of fixed-price type production options to a 
development contract, or a contract for the lead ship of a class, which 
increases the price or ceiling price by more than $250 million for 
equivalent quantities.
    (iii) Notify the USD(A&T) of an intent not to exercise a fixed-price 
production option on a development contract for a major weapon system 
reasonably in advance of the expiration of the option exercise period.
    (iv) A cost-sharing arrangement (see FAR 16.303) must be used for 
contracts

[[Page 275]]

awarded in support of the Manufacturing Technology Program, unless an 
alternative is approved by the Secretary of Defense (10 U.S.C. 2525). 
Approval by the Secretary of Defense to use other than a cost-sharing 
arrangement for the Manufacturing Technology Program must be based on a 
determination that the contract is for a program that--
    (A) Is not likely to have any immediate and direct commercial 
application;
    (B) Is of sufficiently high risk to discourage cost sharing by non-
Federal Government sources; or
    (C) Will be carried out by an institution of higher education.
[56 FR 36416, July 31, 1991, as amended at 57 FR 14994, Apr. 23, 1992; 
58 FR 28471, May 13, 1993; 59 FR 27673, May 27, 1994; 60 FR 4570, Jan. 
24, 1995; 60 FR 29500, June 5, 1995; 61 FR 50454, Sept. 26, 1996; 62 FR 
34126, June 24, 1997]



235.007  Solicitations.

    (g) To ensure that prospective offerors fully understand the details 
of the work, the contracting officer may include the Government's 
estimate of the man-year effort under a research contract.



235.010  Scientific and technical reports.

    (b) The Defense Technical Information Center (DTIC) is responsible 
for collecting all scientific or technological observations, findings, 
recommendations, and results derived from DoD endeavors, including both 
in-house and contracted efforts. The DTIC has eligibility and 
registration requirements for use of its services. Requests for 
eligibility and registration information should be addressed to DTIC-
BCS, 8725 John J. Kingman Road, Suite 0944, Fort Belvoir, VA 22060-0944.
[60 FR 29500, June 5, 1995, as amended at 62 FR 34126, June 24, 1997]



235.015  Contracts for research with educational institutions and nonprofit organizations.

    (b) Basic agreements.
    (3) When using a basic agreement--
    (i) Incorporate it by reference in section I of the contract; and
    (ii) Incorporate any special clause requirements in section H.
[59 FR 27673, May 27, 1994]



235.015-70  Special use allowances for research facilities acquired by educational institutions.

    (a) Definitions. As used in this subsection--
    (1) Research facility means--
    (i) Real property, other than land; and
    (ii) Includes structures, alterations, and improvements, acquired 
for the purpose of conducting scientific research under contracts with 
departments and agencies of the DoD.
    (2) Special use allowance means a negotiated direct or indirect 
allowance--
    (i) For construction or acquisition of buildings, structures, and 
real property, other than land; and
    (ii) Where the allowance is computed at an annual rate exceeding the 
rate which normally would be allowed under FAR subpart 31.3.
    (b) Policy. (1) Educational institutions are to furnish the 
facilities necessary to perform Defense contracts. FAR 31.3 governs how 
much the Government will reimburse the institution for the research 
programs. However, in extraordinary situations, the Government may give 
special use allowances to an educational institution when the 
institution is unable to provide the capital for new laboratories or 
expanded facilities needed for Defense contracts.
    (2) Decisions to provide a special use allowance must be made on a 
case-by-case basis, using the criteria in paragraph (c) of this 
subsection.
    (c) Authorization for special use allowance. The head of a 
contracting activity may approve special use allowances only when all of 
the following conditions are met--
    (1) The research facility is essential to the performance of DoD 
contracts;
    (2) Existing facilities, either Government or nongovernment, cannot 
meet program requirements practically or effectively;
    (3) The proposed agreement for special use allowances is a sound 
business arrangement;

[[Page 276]]

    (4) The Government's furnishing of Government-owned facilities is 
undesirable or impractical; and
    (5) The proposed use of the research facility is to conduct 
essential Government research which requires the new or expanded 
facilities.
    (d) Application of the special use allowance. (1) In negotiating a 
special use allowance--
    (i) Compare the needs of DoD and of the institution for the research 
facility to determine the amount of the special use allowance;
    (ii) Consider rental costs for similar space in the area where the 
research facility is or will be located to establish the annual special 
use allowance;
    (iii) Do not include or allow--
    (A) The costs of land; or
    (B) Interest charges on capital;
    (iv) Do not include maintenance, utilities, or other operational 
costs;
    (v) The period of allowance generally will be--
    (A) At least ten years; or
    (B) A shorter period if the total amount to be allowed is less than 
the construction or acquisition cost for the research facility;
    (vi) Generally, provide for allocation of the special use allowance 
equitably among the Government contracts using the research facility;
    (vii) Special use allowances apply only in the years in which the 
Government has contracts in effect with the institution. However, if in 
any given year there is a reduced level of Government research effort 
which results in the special use allowance being excessive compared to 
the Government research funding, a separate special use allowance may be 
negotiated for that year;
    (viii) Special use allowances may be adjusted for the period before 
construction is complete if the facility is partially occupied and used 
for Government research during that period.
    (2) A special use allowance may be based on either total or partial 
cost of construction or acquisition of the research facility.
    (i) When based on total cost neither the normal use allowance nor 
depreciation will apply--
    (A) During the special use allowance period; and
    (B) After the educational institution has recovered the total 
construction or acquisition cost from the Government or other users.
    (ii) When based on partial cost, normal use allowance and 
depreciation--
    (A) Apply to the balance of costs during the special use allowance 
period to the extent negotiated in the special use allowance agreement; 
and
    (B) Do not apply after the special use allowance period, except for 
normal use allowance applied to the balance.
    (3) During the special use allowance period, the research facility--
    (i) Shall be available for Government research use on a priority 
basis over nongovernment use; and
    (ii) Cannot be put to any significant use other than that which 
justified the special use allowance, unless the head of the contracting 
activity, who approved the special use allowance, consents.
    (4) The Government will pay only an allocable share of the special 
use allowance when the institution makes any substantial use of the 
research facility for parties other than the Government during the 
period when the special use allowance is in effect.
    (5) In no event shall the institution be paid more than the 
acquisition costs.
[56 FR 36416, July 31, 1991, as amended at 60 FR 29500, June 5, 1995]



235.015-71  Short form research contract (SFRC).

    (a) Scope. This section prescribes procedures for contracting within 
the U.S. for research on a cost-reimbursement basis with educational 
institutions or nonprofit organizations whose primary purpose is the 
conduct of scientific research.
    (b) Definitions. As used in this section--
    (1) Educational institution means an institution of higher learning 
which--
    (i) Provides facilities for teaching and research; and
    (ii) Is authorized to grant academic degrees.
    (2) Nonprofit organization means--
    (i) Organizations of the type--
    (A) Described in section 501 (c)(3) and (d) of the Internal Revenue 
Code of 1954 (26 U.S.C. 501(c)); and

[[Page 277]]

    (B) Exempt from taxation under section 501(a) of the Internal 
Revenue Code (26 U.S.C. 501(a)); or
    (ii) Any nonprofit scientific organization qualified under a state 
nonprofit organization statute.
    (3) Research includes all effort described as research in 235.001, 
including that part of exploratory development applicable to applied 
research.
    (c) Applicability. (1) Do not use the SFRC for any purpose other 
than as described in this section.
    (2) The procedures in this section may be used if--
    (i) The principal purpose of the acquisition is research from an 
educational institution or a nonprofit organization;
    (ii) The effort will be on a cost-reimbursement basis;
    (iii) The basis for award is--
    (A) A basic research proposal responding to a broad agency 
announcement (FAR 6.102(d)(2)); or
    (B) An unsolicited research proposal (FAR 6.302-1); or
    (C) A proposal establishing or maintaining an essential engineering, 
research, or development capability (FAR 6.302-3); and
    (iv) The contract requires the delivery of designs, drawings, or 
reports as end items.
    (d) Content of research proposal. Research proposals submitted under 
this section must contain--
    (1) All the information in FAR 15.505;
    (2) A statement of work complying with FAR 35.005, and a breakdown 
of the time the principal investigator and any associates will devote to 
the contract (see FAR 35.015(a)). The breakdown will be by work-days, 
work-months, or work-years;
    (3) The executed representations on DD Form 2222-1, Representations 
and Certifications from Offerors Submitting Proposals Under DFARS 
235.70. (Representations and certifications submitted on a one-time 
basis to each contracting office are valid for all SFRC contract awards 
made by that office only if the offeror in each proposal references the 
one-time submission and confirms its validity.);
    (4) A statement that the Government may award a contract under the 
procedures of this section;
    (5)(i) Identification of property in the Contractor-Acquired 
Property clause by showing for each item, when possible--
    (A) The description of the property; and
    (B) The estimated or known cost;
    (ii) The description of the property should be detailed enough to 
enable the contracting officer--
    (A) To determine whether the Government will furnish such property 
under FAR 35.014 and FAR 45.302-1; and
    (B) For property which may be contractor-acquired (versus 
Government-furnished)--
    (1) To accept it as advance notification required by FAR 52.244-2; 
and
    (2) To authorize acquisition at time of award;
    (iii) If the offeror proposes to acquire facilities (FAR 45.301), 
the offeror shall include a written statement which--
    (A) Explains why acquiring these items with contract funds is 
necessary; and
    (B) Expresses the offeror's unwillingness or financial inability to 
acquire the items with the offeror's own resources;
    (iv) Special test equipment or components proposed. Individual items 
of less than $1,000 may be grouped by category (FAR 45.307-2);
    (6) A SF 1411, Contract Pricing Proposal Cover Sheet, or acceptable 
substitute. FAR 52.244-2(b) prescribes information required for 
subcontracts;
    (7) Markings complying with FAR 15.509 on the title page and each 
restricted sheet if the proposal includes data that the offeror does not 
want disclosed for any purpose other than evaluation. In addition, the 
offeror should state in the offer or check Block A on page 2 of the DD 
Form 2222-2 if the offeror grants the Government permission to have 
nongovernment evaluators review the proposal;
    (8) The following statement:

    This proposal incorporates by reference, and makes a part thereof, 
all applicable clauses in DFARS 235.015-71(i) in effect on the effective 
date of the contract or such other dates as may be mutually agreed upon.

    (9) Any other applicable FAR or DFARS clauses agreed to by the 
parties;

[[Page 278]]

    (10) Monthly expenditure estimates by which incremental funding 
periods may be calculated; and
    (11) An executed DD Form 2222-2, Short Form Research Contract 
Research Proposal Cover Page.
    (e) Contracting procedures.
    (1) The contracting officer may award a SFRC under full and open 
competition (FAR Subpart 6.1) when the proposal--
    (i) Is in response to a broad agency announcement under FAR 
6.102(d)(2);
    (ii) Contains the information required by 235.015-71(d); and
    (iii) Has been recommended for award under the peer or scientific 
review procedures of FAR 6.102(d)(2).
    (2) The contracting officer may award an SFRC under other than full 
and open competition (FAR subpart 6.3) when--
    (i) The proposal is an unsolicited research proposal submitted, 
evaluated, and accepted under FAR subpart 15.5, which meets the criteria 
of FAR 6.302-1; or
    (ii) Award is necessary to establish or maintain an essential 
engineering research or development capability under FAR 6.302-1.
    (3) When a research proposal (solicited or unsolicited) is 
satisfactory to the Government, the contracting officer should accept 
the proposal by executing a SFRC incorporating--
    (i) The proposal by reference, or
    (ii) The statement of work by reference.
    (4) When acceptance of the entire research proposal is not 
advantageous to the Government, the contracting officer should use the 
acceptable parts of the research proposal. These parts may be either 
attached or incorporated by reference to develop a contract for 
execution by both parties. In this event, the contractor must sign the 
SFRC before the Government signs.
    (5) Use the DD Form 2222, Short Form Research Center (SFRC) 
Modification, to effect modifications.
    (6) The initial dollar amount and period of performance specified in 
the award document shall include the initial research program only. The 
SFRC shall identify separately the options, periods of performance, and 
costs, if appropriate.
    (7) FAR 35.014 applies to vesting of title in property to 
organizations defined in 235.015-71(b). DD Form 2222 shall identify 
property, title to which is not vested in the contractor, or for which a 
determination of title is deferred.
    (8) The offeror's submission of its proposal under this section 
235.015-71 constitutes the offeror's agreement to be bound by all terms 
and conditions of the resulting contract.
    (f) Advance payments. The contracting officer shall ensure that 
SFRCs awarded to institutions and organizations authorized to receive 
advance payments under FAR subpart 32.4 are clearly marked to read 
``Advance Payment Pool Contract.''
    (g) Method of funding. If incrementally funded, the SFRC shall 
specify--
    (1) The total estimated cost for the full period of the research 
program, both funded and unfunded; and
    (2) The amount of funds currently obligated.
    (h) Uniform contract format. The SFRC is exempt from uniform 
contract format requirements (FAR 15.406).
    (i) SFRC clauses. (1) Include in the contract any FAR or DFARS 
clause agreed to by the parties and incorporate it by reference or full 
text, as appropriate.
    (2) The following clauses should be incorporated by reference in all 
SFRC awards of $25,000 or more. Clauses with a single asterisk (*) apply 
to educational institutions only. Clauses with a double asterisk (**) 
apply to nonprofit organizations only.

FAR 52.202-1  Definitions
FAR 52.203-1  Officials Not to Benefit
FAR 52.203-3  Gratuities
FAR 52.203-5  Covenant Against Contingent Fees
FAR 52.203-6  Restrictions on Subcontractor Sales to the Government
FAR 52.203-7  Anti-Kickback Procedures
252.203-7001  Special Prohibition on Employment
**FAR 52.203-10  Price or Fee Adjustment for Illegal or Improper 
          Activity
FAR 52.209-6  Protecting the Government's Interest When Subcontracting 
          with Contractors Debarred, Suspended, or Proposed for 
          Debarment
252.209-7000  Acquisitions from Subcontractors Subject to On-Site 
          Inspection Under the Intermediate-Range Nuclear Forces (INF) 
          Treaty

[[Page 279]]

FAR 52.215-2  Audit and Records--Negotiation
FAR 52.215-26  Integrity of Unit Prices
**FAR 52.215-30  Facilities Capital Cost of Money (Applies if contract 
          is subject to commercial cost principles, FAR Subpart 31.2)
**FAR 52.215-31  Waiver of Facilities Capital Cost of Money (Applies if 
          contractor does not propose facilities capital cost of money.)
FAR 52.215-33  Order of Precedence
FAR 52.216-7  Allowable Cost and Payment
*FAR 52.216-15  Predetermined Indirect Cost Rates (Applies only when the 
          contractor has an executed negotiation agreement with the 
          cognizant contract administration office. Predetermined rate 
          agreements in effect on the date of the contract shall be 
          incorporated in the contract schedule.)
FAR 52.219-8  Utilization of Small Business and Small Disadvantaged 
          Business Concerns
FAR 52.219-13  Utilization of Women-Owned Small Businesses
FAR 52.220-3  Utilization of Labor Surplus Area Concerns
FAR 52.222-3  Convict Labor
FAR 52.222-26  Equal Opportunity (Add Alternate I as a special provision 
          when applicable.)
FAR 52.222-35  Affirmative Action for Special Disabled and Vietnam Era 
          Veterans
FAR 52.222-36  Affirmative Action for Handicapped Workers
FAR 52.222-37  Employment Reports on Special Disabled Veterans and 
          Veterans of Vietnam Era
FAR 52.223-6  Drug-Free Workplace
FAR 52.225-13  Restrictions on Contracting with Sanctioned Persons
252.225-7016 and Restriction on Acquisition of Foreign Machine Tools
and Alternate I (if applicable)
FAR 52.227-1 and Alternate I  Authorization and Consent
FAR 52.227-2  Notice and Assistance Regarding Patent and Copyright 
          Infringement
FAR 52.227-14  Rights in Data--General (Specify applicable Alternate in 
          contract.)
252.227-7013 and Alternate I  Rights in Technical Data and Computer 
          Software
252.227-7018  Restrictive Markings on Technical Data
252.227-7029  Identification of Technical Data
**252.227-7030  Technical Data--Withholding of Payment
FAR 52.228-7  Insurance--Liability to Third Persons Alternates I and II, 
          if applicable)
**252.231-7000  Supplemental Cost Principles (Applies to nonprofit 
          institutions, when allowability of costs is determined under 
          FAR Subpart 31.2)
FAR 52.232-23  Assignment of Claims
FAR 52.232-25  Prompt Payment
FAR 52.233-1  Disputes
FAR 52.233-3 and Alternate I  Protest After Award
252.235-7004  Option to Extend the Term of the Contract
252.235-7005  Contractor-Acquired Property
252.235-7006  Title to Contractor-Acquired Property
252.235-7007  Advance Payments
252.235-7008  Inspection and Acceptance
252.235-7009  Restriction on Printing
FAR 52.242-1  Notice of Intent to Disallow Costs
252.242-7001  Certification of Indirect Cost
252.242-7004  Material Management and Accounting System
**FAR 52.243-2 and Alternate V  Changes--Cost-Reimbursement
FAR 52.244-2 and Alternate I  Subcontracts (Cost-Reimbursement and 
          Letter Contracts)
FAR 52.244-5  Competition in Subcontracting
FAR 52.245-5 and Alternate I  Government Property (Cost-Reimbursement, 
          Time-and-Material, or Labor-Hour Contracts.)
FAR 52.247-63  Preference for U.S.-Flag Air Carriers
FAR 52.251-1  Government Supply Sources
252.251-7000  Ordering from Government Supply Sources
FAR 52.253-1  Computer Generation of Forms by the Public

    (3) The following clauses should be incorporated by reference in all 
SFRC contracts of $100,000 or more. Clauses with a double asterisk (**) 
apply to nonprofit organizations only.

FAR 52.203-12  Limitation on Payments to Influence Certain Federal 
          Transactions.
252.203-7000  Statutory Prohibitions on Compensation to Former 
          Department of Defense Employees
FAR 52.222-2  Payment for Overtime Premiums (The word ``zero'' is 
          inserted in the blank space indicated by an asterisk.)
FAR 52.223-2  Clean Air and Water Act (Applies if contract amount 
          exceeds the dollar amount set forth in the preamble to the 
          clause.)
**FAR 52.230-2  Cost Accounting Standards (If contract is not exempt 
          under 48 CFR chapter 99 (appendix B, FAR looseleaf edition), 
          subpart 9903.201.)
**FAR 52.230-3  Disclosure and Consistency of Cost Accounting Practices 
          (If contract is not exempt under 48 CFR chapter 99 (appendix 
          B, FAR looseleaf edition), subpart 9903.201.)
**FAR 52.230-5  Administration of Cost Accounting Standards (If contract 
          is not exempt under 48 CFR chapter 99 (appendix B, FAR 
          looseleaf edition), subpart 9903.201.)

[[Page 280]]

252.231-7001  Penalties for Unallowable Costs.
252.233-7000  Certification of Claims and Requests for Adjustment or 
          Relief.

    (4) The following clauses should be incorporated by reference, if 
applicable.

FAR 52.215-22  Price Reduction for Defective Cost or Pricing Data
FAR 52.215-24  Subcontractor Cost or Pricing Data (Applies only if FAR 
          52.215-22 applies.)
FAR 52.215-27  Termination of Defined Benefit Pension Plans (Applies if 
          certified cost and pricing data are required and cost 
          determinations are subject to FAR Subpart 31.2.)
252.215-7000  Pricing Adjustments (Applicable if FAR 52.215-23, 24, or 
          25 applies.)
FAR 52.216-8  Fixed Fee (Applies in cost-plus-fixed-fee contracts.)
FAR 52.216-11 and Alternate I  Cost Contract--No Fee
FAR 52.216-12 and Alternate I  Cost Sharing Contract--No Fee
252.225-7000  Pricing Adjustments (Applies if FAR 52.215-23, 24, or 25 
          applies.)
252.225-7023  Reporting of Subcontracts (Applies only when contract 
          action exceeds $500,000, or when any modification increases 
          contract amount to more than $500,000.)
FAR 52.227-11  Patents Rights--Retention by the Contractor (Short Form)
252.227-7034  Patents--Subcontracts
252.227-7039  Patents--Reporting of Subject Inventions
FAR 52.232-9  Limitation on Withholding of Payments
FAR 52.232-17  Interest
FAR 52.232-20  Limitation of Cost (Applies only when contract is fully 
          funded.)
FAR 52.232-22  Limitation of Funds (Applies only when contract is 
          incrementally funded.)
FAR 52.232-28  Electronic Funds Transfer Payment Methods
FAR 52.246-23  Limitation of Liability
FAR 52.246-24  Limitation of Liability--High Value Items
FAR 52.246-25  Limitation of Liability--Services
FAR 52.249-5  Termination for Convenience of the Government (Educational 
          and Other Nonprofit Institutions). (Applies if work is done on 
          a no-profit or no-fee basis)
FAR 52.249-6  Termination (Cost Reimbursement) (Applies if work is 
          performed on a fee or profit basis.)
FAR 52.249-14  Excusable Delays (Applies only to contracts in which FAR 
          52.249-6 applies.)
[56 FR 36416, July 31, 1991, as amended at 57 FR 53600, Nov. 12, 1992; 
59 FR 27673, May 27, 1994; 60 FR 61598, Nov. 30, 1995]



235.016  Broad agency announcement.

    To help achieve the goals of Section 1207 of Public Law 99-661 (see 
part 226), contracting officers shall--
    (1) Whenever practicable, reserve discrete or severable areas of 
research interest contained in broad agency announcements for exclusive 
competition among historically black colleges and universities and 
minority institutions;
    (2) Indicate such reservation--
    (i) In the broad agency announcement; and
    (ii) In the announcement synopsis (see 205.207(d)(v)).



235.017  Federally Funded Research and Development Centers.

    (a) Policy.
    (2) No DoD fiscal year 1992 or later funds may be obligated or 
expended to finance activities of a DoD Federally Funded Research and 
Development Center (FFRDC) if a member of its board of directors or 
trustees simultaneously serves on the board of directors or trustees of 
a profit-making company under contract to DoD, unless the FFRDC has a 
DoD-approved conflict of interest policy for its members (section 8107 
of Pub. L. 102-172 and similar sections in subsequent Defense 
appropriations acts).
[58 FR 28471, May 13, 1993]



235.017-1  Sponsoring agreements.

    (c)(4) DoD-sponsoring FFRDCs that function primarily as research 
laboratories (C3I Laboratory operated by the Institute for Defense 
Analysis, Lincoln Laboratory operated by Massachusetts Institute of 
Technology, and Software Engineering Institute) may respond to 
solicitations and announcements for programs which promote research, 
development, demonstration, or transfer of technology (Section 217, 
Public Law 103-337).
[60 FR 61598, Nov. 30, 1995]

[[Page 281]]



235.070  Indemnification against unusually hazardous risks.



235.070-1  Indemnification under research and development contracts.

    (a) Under 10 U.S.C. 2354 and if authorized by the Secretary 
concerned, or designee under 10 U.S.C. 2356, contracts for research and/
or development may provide for indemnification of the contractor or 
subcontractors for--
    (1) Claims by third persons (including employees) for death, bodily 
injury, or loss of or damage to property; and
    (2) Loss of or damage to the contractor's property to the extent 
that the liability, loss, or damage--
    (i) Results from a risk that the contract defines as ``unusually 
hazardous;''
    (ii) Arises from the direct performance of the contract; and
    (iii) Is not compensated by insurance or other means.
    (b) Clearly define the specific unusually hazardous risks to be 
indemnified. Submit this definition for approval with the request for 
authorization to grant indemnification. Include the approved definition 
in the contract.



235.070-2  Indemnification under contracts involving both research and development and other work.

    These contracts may provide for indemnification under the authority 
of both 10 U.S.C. 2354 and Public Law 85-804. Public Law 85-804 will 
apply only to work to which 10 U.S.C. 2354 does not apply. Actions under 
Public Law 85-804 must also comply with FAR subpart 50.4.



235.070-3  Contract clauses.

    When the contractor is to be indemnified in accordance with 235.070-
1, use either--
    (a) The clause at 252.235-7000, Indemnification Under 10 U.S.C. 
2354--Fixed Price; or
    (b) The clause at 252.235-7001, Indemnification Under 10 U.S.C. 
2354--Cost-Reimbursement, as appropriate.



235.071  Additional contract clauses.

    (a) Use the clause at 252.235-7002, Animal Welfare, or one 
substantially the same, in solicitations and contracts awarded in the 
United States, its possessions, and Puerto Rico involving research on 
live vertebrate animals.
    (b) Use the clause at 252.235-7003, Frequency Authorization, in 
solicitations and contracts for developing, producing, constructing, 
testing, or operating a device requiring a frequency authorization.
    (c) Use the clause at 252.235-7010, Acknowledgement of Support and 
Disclaimer, in solicitations and contracts for research and development.
    (d) Use the clause at 252.235-7011, Final Scientific or Technical 
Report, in solicitations and contracts for research and development.
[56 FR 36416, July 31, 1991, as amended at 60 FR 29500, June 5, 1995]



    Subpart 235.70--Research and Development Streamlined Contracting 
                            Procedures--Test

    Source:  59 FR 52443, Oct. 18, 1994, unless otherwise noted.



235.7000  Scope.

    This subpart prescribes streamlined acquisition procedures for use 
in support of DoD laboratories in acquiring research and development, as 
defined in 235.001 and FAR 35.001.



235.7001  Definitions.

    As used in this subpart--
    (a) Research and development streamlined solicitation (RDSS) means 
the solicitation published in the Commerce Business Daily and a 
supplemental package, if necessary.
    (b) Supplemental package is part of the streamlined solicitation, if 
appropriate. It contains any information that is too voluminous to be 
included in the solicitation published in the Commerce Business Daily.
[59 FR 52443, Oct. 18, 1994, as amended at 62 FR 16100, Apr. 4, 1997]



235.7002  Applicability.

    (a) The following contracting offices have been approved by the 
Director of Defense Procurement for participation in the test and may 
use the procedures of this subpart pending implementation of permanent 
procedures.
    (1) Army: Army Materiel Command contracting offices when contracting

[[Page 282]]

for Army Research Laboratory, Missile Research & Development Center, and 
the Medical Research & Development Command; Army Corps of Engineers 
contracting offices when contracting for the Waterways Experiment 
Station; Army Soldier Systems Command contracting office.
    (2) Navy: Naval Research Laboratory contracting office; Naval 
Surface Warface Center contracting offices when contracting for the 
Carderock, Crane, Dahlgren, Indian Head and Port Hueneme divisions; 
Naval Undersea Warfare Center contracting office; Naval Command, Control 
and Ocean Surveillance Center contracting office.
    (3) Air Force: Air Force Materiel Command contracting offices when 
contracting for Armstrong Laboratory, Phillips Laboratory, Rome 
Laboratory, Wright Laboratory.
    (4) Defense Agencies: Armed Forces Radiobiology Research Institute 
contracting office, Defense Special Weapons Agency contracting office.
    (b) Consider using the procedures in this subpart when the 
acquisition will result in a cost-reimbursement type contract that is 
valued at $10,000,000 or less and meets the criteria for research and 
development as defined in 235.001 and FAR 35.001. The procedures in this 
subpart shall not be used for--
    (1) Contracts to be performed outside of the United States and 
Puerto Rico;
    (2) Contracts denominated in other than U.S. dollars; or
    (3) Acquisitions using simplified acquisition procedures.
    (c) Do not use the procedures of this subpart to contract for 
``engineering development,'' ``operational system development,'' or 
``management and support'' as defined in 235.001; or for laboratory 
supplies and equipment, base support services, or other services 
identified in FAR 37.101 (a) through (h).
    (d) Regardless of whether or not the RDSS is used, the contracting 
officer may use the research and development streamlined contracting 
format at 235.7006 for any acquisition that meets the criteria in 
235.7002(b).
[59 FR 52443, Oct. 18, 1994, as amended at 60 FR 15690, Mar. 27, 1995; 
60 FR 61598, Nov. 30, 1995; 61 FR 50454, Sept. 26, 1996; 62 FR 16100, 
Apr. 4, 1997]



235.7003  [Reserved]



235.7004  The research and development streamlined solicitation (RDSS).



235.7004-1  General.

    The RDSS process consists of:
    (a) Synopsis. The synopsis required by FAR 5.203(a), in addition to 
providing the information set forth at FAR 5.207, must advise potential 
offerors that a conventional solicitation will not be issued but that 
the solicitation will appear in a subsequent edition of the Commerce 
Business Daily (CBD). The synopsis must also advise potential offerors 
to provide address information to the office indicated in order to be 
included on the mailing list for any supplemental packages and/or 
amendments.
    (b) Solicitation. The solicitation is published in a second CBD 
notice. The solicitation consists of the information listed at 
235.7006(d)(A.1), including the statement of work, and incorporates by 
reference the appropriate terms and conditions in the format at 
235.7006. FAR 5.207 limits the submissions to the CBD to 12,000 textual 
characters (approximately 3\1/2\ single-spaced pages).
    (c) Supplemental package. Use a supplemental package if the 
solicitation must exceed 3\1/2\ single-spaced pages, or to provide forms 
or other printed material to potential offerors. Send the supplemental 
package on the date the solicitation is published in the CBD to all 
interested parties that provide address information.
    (d) Amendments. Amend the RDSS as set forth at 235.7004-2(f).
[59 FR 52443, Oct. 18, 1994, as amended at 60 FR 15690, Mar. 27, 1995]



235.7004-2  Solicitation procedures.

    (a) Publish the synopsis as soon as the information required by FAR 
5.207 is available.
    (b) Publish the solicitation no earlier than 15 days after 
publication of the synopsis and include, as a minimum, the information 
required by 235.7006(d)(A.1) and a reference to the synopsis.
    (c) Send any supplemental package on the date the solicitation is 
published in the Commerce Business Daily,

[[Page 283]]

to all interested parties that provided address information.
    (d) In accordance with FAR 5.203(b), establish a due date for 
submission of offers that is no earlier than 45 days after publication 
of the synopsis.
    (e) Request cost and technical proposals from all offerors. To 
encourage preparation of better cost proposals, consider allowing a 
delay between the due dates for technical and cost proposals.
    (f) Amend the solicitation, if necessary, by forwarding an SF 30, 
Amendment of Solicitation/Modification of Contract, to all interested 
parties that provided address information in response to the synopsis.
    (g) Post copies of all Commerce Business Daily notices in accordance 
with FAR 5.101(a)(2).
[59 FR 52443, Oct. 18, 1994, as amended at 60 FR 15690, Mar. 27, 1995]



235.7004-3  Proposal evaluation and contract award procedures.

    (a) Evaluate proposals in accordance with FAR subpart 15.6, as 
supplemented by departmental procedures and this subpart.
    (b) Select the proposal which offers the greatest value in terms of 
the evaluation factors set forth in the RDSS.
    (c) Before award, require the apparent successful offeror to submit 
the representations and certifications set forth in 235.7006(d), Section 
K, Representations, Certifications and Other Statements of Offerors or 
Quoters.
    (d) Whenever appropriate, award without discussion pursuant to FAR 
52.215-16, Alternate (II).
[59 FR 52443, Oct. 18, 1994, as amended at 60 FR 15690, Mar. 27, 1995; 
60 FR 61598, Nov. 30, 1995; 61 FR 7744, Feb. 29, 1996]



235.7005  The research and development streamlined contract (RDSC).

    The RDSC is the streamlined contract that results from the use of 
the RDSS or other solicitation procedures that meet the criteria for use 
of the RDSS. Include the following in RDSCs:
    (a) Standard Form (SF) 33, Solicitation, Offer and Award, or SF 26, 
Award/Contract;
    (b) Sections B through J of the RDSS or other solicitation, with 
applicable fill-ins completed and clause dates added.
[59 FR 52443, Oct. 18, 1994, as amended at 62 FR 16100, Apr. 4, 1997]



235.7006  The research and development streamlined contracting format.

    (a) The clauses and provisions prescribed in the exhibit to 
paragraph (d) of this section are mandatory unless they are marked with 
an asterisk. Terms, clauses and provisions marked with an asterisk are 
for use as appropriate as prescribed elsewhere in FAR and DFARS. List in 
the solicitation published in the Commerce Business Daily (see paragraph 
(d)(A.1)(v) of this section) the numbers of any asterisked terms, 
clauses, and provisions that apply to the acquisition, and the text of 
any special provisions, instructions, or notices that are approved for 
use in the solicitation.
    (b) At the time of contract award to educational or nonprofit 
institutions, delete those clauses and provisions that do not apply to 
such institutions, and, as necessary, replace with the appropriate 
alternatives. For example, FAR 52.203-10 will be included in all 
solicitations, but deleted in awards to educational institutions.
    (c) The use of FAR and DFARS provisions and clauses, and nonstandard 
provisions and clauses approved for agency use, that are not in the 
research and development streamlined contract format provided by the 
Exhibit in this section, shall be approved in accordance with agency 
procedures.
    (d) The research and development streamlined contract format is set 
forth in the following exhibit:

      Exhibit--Research and Development Streamlined Contract Format

                          Part I--The Schedule

                  Section A, Solicitation/Contract Form

    (A.1) Research and development streamlined solicitation (RDSS). 
Include the following in the RDSS:
    (i) Solicitation number;
    (ii) A statement that award will be made in accordance with DFARS 
Subpart 235.70, Research and Development Streamlined Contracting 
Procedures;
    (iii) A statement as to whether the RDSS includes a supplemental 
package;

[[Page 284]]

    (iv) Instructions for obtaining any supplemental package, including 
use of Electronic Bulletin Boards, as appropriate;
    (v) A statement that all of the mandatory terms, clauses, and 
provisions, and certain asterisked terms, clauses, and provisions in 
DFARS 235.7006 are incorporated by reference. This statement must list 
the asterisked terms, clauses, and provisions that apply. (For example: 
``All of the mandatory terms, clauses, and provisions at DFARS 235.7006, 
Research and development streamlined contract format, and the following 
items listed therein for use as applicable are incorporated by 
reference: B.4, B.5, C.1, E.3, I.80.'') Additions to and deletions from 
the clauses and provisions listed in the standard format, and data 
required to be inserted in blanks in clauses or solicitation provisions, 
when known at the time the solicitation is published, must be clearly 
annotated in the RDSS;
    (vi) A statement that the clauses and provisions are those in effect 
through FAC ______, DAC ______, and Departmental Letter No. ______;
    (vii) A statement that the standard evaluation factors at Section M 
of this subpart apply, or, if they do not apply, the applicable 
evaluation factors. If the standard evaluation factors are modified in 
any way, the modifications must be clearly expressed so that the result 
is unambiguous. Additions to and deletions from Section M must be 
clearly annotated in the RDSS;
    (viii) Identification of data requirements by including either:
    (A) A summary of the data requirements that identifies all 
deliverable data items, and specifies number of copies and frequency of 
delivery; or
    (B) A notice that DD Form 1423, Contract Data Requirements List, is 
included in the supplemental package;
    (ix) Type of cost contract contemplated;
    (x) Estimated period of performance;
    (xi) Notice of preproposal conference, if applicable, with location, 
date, and time;
    (xii) Notice of small business or other set-aside, if applicable;
    (xiii) Notice of place, date, and time technical and cost proposals 
are due;
    (xiv) Number of copies of technical and cost proposals required;
    (xv) Proposal page limitations;
    (xvi) Whether multiple awards are contemplated;
    (xvii) Name, address, and telephone number of contracting officer;
    (xviii) Any applicable Commerce Business Daily numbered notes;
    (xix) Statement that a DD Form 254, Contract Security Classification 
Specification, will be included in the supplemental package, if 
appropriate;
    (xx) The statement of work, or a statement that the statement of 
work is in the supplemental package; and
    (xxi) The applicable Standard Industrial Classification (SIC) code 
and small business size standard.
    (A.2) Research and development streamlined contract (RDSC). Use 
either Standard Form (SF) 33, Solicitation, Offer and Award, or SF 26, 
Award/Contract.

            Section B, Supplies or Services and Prices/Costs

    (Use appropriate CLIN structure. Include item descriptions.)
    (B.1) Type of Contract.
    This is a ________________ Contract.
    *(B.2) Estimated Cost. (Use when no fee will be paid)
    The total estimated cost for this contract is $____________
    *(B.3) Cost-Plus-Fixed-Fee. (Applicable to fee-bearing contracts)
    The total estimated cost for this contract is $____________
    The total fixed fee for this contract is $ ____________
    *(B.4) Award Fee. (Applicable to award fee-type contracts)
    In addition to the fee set forth elsewhere in the contract, the 
Contractor may earn an award fee up to $______ on the basis of 
performance during the performance periods, and in the amount specified 
in the award fee plan.
    (i) Monitoring of performance. The contractor's performance will be 
monitored continually by the Award Fee Review Board.
    (ii) Award fee plan. This plan provides necessary administrative 
information, including the evaluation criteria and schedule, for the 
purpose of implementing the award fee provision. Upon contract award, 
the Contractor will be provided the award fee plan subject to any 
withholding authorized by the ____________ (insert appropriate 
contracting official).
    (iii) Modification of award fee plan. Before the start of an 
evaluation period, the Government may unilaterally--
    (A) Modify the award fee performance evaluation criteria and areas 
applicable to the evaluation period; and
    (B) Redistribute the remaining award fee dollars among the remaining 
periods. The Contracting Officer will notify the Contractor in writing 
of the changes and modify the award fee plan accordingly.
    (iv) The following standards of performance shall be used in 
determining whether and to what extent the Contractor has earned or may 
be entitled to receive any award fee:
    (A) Excellent performance: Contractor performance of virtually all 
contract task requirements is uniformly well above standard and exceeds 
the standard by a substantial

[[Page 285]]

margin in numerous significant tangible or intangible benefits to the 
Government (i.e., improved quality, responsiveness, increased 
timeliness, or generally enhanced effectiveness of operations). There 
are few areas for improvement; these areas are all minor; there are no 
recurring problems; and management has initiated effective corrective 
action whenever needed.
    (B) Very good performance: The contractor's performance of most 
contract task requirements is uniformly well above standard and exceeds 
the standard in many significant areas. Although some areas may require 
improvements these are minor and are more than offset by better 
performance in other areas. Few, if any, recurring deficiencies have 
been noted in the Contractor's performance and the contractor has 
demonstrated/taken satisfactory corrective action. Innovative management 
actions have resulted intangible or in tangible benefits to the 
Government (i.e., improved quality, responsiveness, increased quantity, 
increased timeliness, or generally enhanced effectiveness of 
operations).
    (C) Good performance: Contractor's performance of most contract task 
requirements meets the standard, and it exceeds the standard in several 
significant areas. While the remainder of the contractor's effort 
generally meets contract requirements, areas requiring improvement are 
more than offset by better performance in other areas. Management 
actions taken or initiated have resulted in some demonstrated benefits 
to the Government (i.e., improved quality, responsiveness, timeliness, 
or effectiveness of operations).
    (D) Marginal performance: Contractor performance meets most contract 
standards. Although there are areas of good or better performance, these 
are more or less offset by lower rated performance in other areas. 
Little additional tangible benefit is observable due to contractor 
effort or initiative.
    (E) Submarginal performance: Contractor performance is below 
standard in several areas. Contractor performance in accordance with 
requirements is inconsistent. Quality, responsiveness, timeliness, and/
or economy in many areas require attention and action. Corrective 
actions have not been taken, or are ineffective. Overall submarginal 
performance shall not be given award fee.
    (v) Maximum payable award fee. The maximum payable award fee in any 
evaluation period shall be determined based on the amount set forth in 
the applicable contract line items and a percentage based on the 
Government's evaluation of the Contractor's performance as follows:

                                                                        
------------------------------------------------------------------------
                                            Percent of maximum award fee
               Performance                            payable           
------------------------------------------------------------------------
Excellent................................  __% to __%                   
Very Good................................  __% to __%                   
Good.....................................  __% to __%                   
Marginal.................................  __% to __%                   
Submarginal..............................  0%                           
------------------------------------------------------------------------

    (vi) Self-evaluation. The Contractor may submit to the Contracting 
Officer within five working days after the end of each award fee 
evaluation period, a brief written self-evaluation of its performance 
for the period. This statement may contain information which may be used 
to assist the Award Fee Review Board in its evaluation of the 
Contractor's performance during the period.
    (vii) Disputes. The decision of the Fee Determining Official on the 
amount of award fee will not be subject to the ``Disputes'' clause.
    (viii) Award fee payment.
    (A) As determined by the Fee Determining Official, payment of any 
award fee will not be subject to the ``Allowable Cost and Payment'' and 
``Termination (Cost Reimbursement)'' clauses of this contract.
    (B) The Contractor may submit vouchers for the award fee immediately 
upon receipt of the Contracting Officer's written award fee 
notification.
    *(B.5) Target Cost and Fee. (Applicable to incentive fee-type 
contracts. The following information shall be inserted into the 
appropriate blanks in clause I.54.) The target cost is $__________.
    The target fee is $__________.
    The minimum fee the contractor may receive is $__________.
    The maximum fee the contractor may receive is $__________.
    Share ratio:________________.
(Government/Contractor)
    *(B.6) Payment of Fixed Fee on Cost-Plus-Fixed-Fee (Completion) 
Contracts. The fixed fee shall be paid in monthly installments based 
upon the percentage of completion of work as determined by the 
Administrative Contracting Officer, subject to the withholding 
provisions of the contract.
    *(B.7) Payment of Fixed Fee on Cost-Plus-Fixed-Fee (Term) Contracts. 
(Applicable to cost-plus-fixed-fee (term) contracts when the clause at 
FAR 52.216-8 is used.) Pursuant to the clause at FAR 52.216-8, Fixed 
Fee, and subject to withholding provisions contained in that clause or 
elsewhere in this contract, fixed fee shall be paid to the Contractor 
based upon the percentage of hours completed as related to the total 
hours set forth in the contract on each voucher. The Contractor shall 
certify to the level of effort expended during that period. The 
Government technical representative shall sign a statement on the 
certificate that the work performed during the period has been performed 
satisfactorily.

[[Page 286]]

    *(B.8) Options. (Applicable to contracts with options) The 
Government may require performance of the work required by CLIN ______. 
The Contracting Officer shall provide written notice of intent to 
exercise this option to the Contractor on or before __________. If the 
Government exercises this option by ______, the Contractor shall perform 
at the estimated cost and fee, if applicable, set forth as follows:


                                                                        
                                                                        
                                                                        
Estimated Cost....................................     $________________
OR                                                                      
Estimated Cost....................................     $________________
Fixed Fee.........................................     $________________
Total.............................................     $________________
OR                                                                      
Estimated Cost....................................     $________________
Base Fee..........................................     $________________
Maximum Award Fee.................................     $________________
Total.............................................     $________________
OR                                                                      
Target Cost.......................................     $________________
Minimum Fee.......................................     $________________
Target Fee........................................     $________________
Maximum Fee.......................................     $________________
Share Ratio.......................................     $________________
                                                                        

          Section C, Description/Specifications/Work Statements

    *(C.1) Classified Work Statement. (Applicable if Section C is 
classified.) The description/specifications/work statement entitled, 
``____________,'' classified ____________, dated ____________, is 
incorporated herein by reference. A copy may be obtained from the 
Contracting Officer, if a need-to-know is established and appropriate 
security clearance has been granted.
    *(C.2) Unclassified Work Statement. (Applicable if Section C is 
unclassified and is attached to the contract.) The description/
specifications/work statement is included as Attachment ____________.
    *(C.3) Contractor's Technical Proposal. (Applicable if portions of 
the Contractor's proposal are incorporated by reference. Include only 
those portions of the proposal that specifically describe the work to be 
performed.) The Contractor's proposal entitled, ``____________,'' pages 
____________, dated ____________, is incorporated herein by reference.

                     Section D, Packing and Marking

    (D.1) Commercial Packaging.
    Preservation, packaging, and packing shall provide adequate 
protection against physical damage during shipment for all deliverable 
items in accordance with standard commercial practices.

                  Section E, Inspection and Acceptance

(1) Federal Acquisition Regulation clauses:

                                                                        
                                                                        
                                                                        
*(E.1).............................     52.246-8  Inspection of Research
                                                   and Development--Cost
                                                   Reimbursement.       
*(E.2).............................     52.246-8  Inspection of Research
                                                   and Development--Cost
                                                   Reimbursement        
                                                   (Alternate I).       
*(E.3).............................     52.246-9  Inspection of Research
                                                   and Development      
                                                   (Short Form).        
(2) Defense Federal Acquisition Regulation Supplement clauses.          
*(E.4).............................  252.246-700  Material Inspection   
                                               0   and Receiving Report.
                                                                        
                                                                        

    (3) Other provisions.
    (E.5) Inspection and Acceptance.
    Inspection and acceptance of any and all deliverables under this 
contract will be accomplished by the contracting officer or a designated 
representative.

                  Section F, Deliveries or Performance

    *(F.1) FAR 52.242-15 Stop Work Order--Alternate I.
    (F.2) Delivery of Reports.
    (i) All data shall be delivered in accordance with the delivery 
schedule shown on the Contract Data Requirements List, attachments, or 
as incorporated by reference.
    (ii) All reports and correspondence submitted under this contract 
shall include the contract number and project number and be forwarded 
prepaid. A copy of the letters of transmittal shall be delivered to the 
Procuring Contracting Officer (PCO) and the Administrative Contracting 
Officer (ACO). The addresses are set forth on the contract award cover 
page. All other address(es) and code(s) for consignee(s) are as set 
forth in the contract or incorporated by reference.
    *(F.3) FAR 52.247-55 F.O.B. Point of Delivery for Government-
Furnished Property.
    *(F.4) The work under this contract shall commence on 
________________ and be completed no later than ________________.

                 Section G, Contract Administration Data

    *(G.1) Contractor Payment Address. (To be filled in at time of 
contract award. Applicable if the Contractor has specified a payment 
address other than the address shown on the cover page of the contract.)

[[Page 287]]

    Contractor Payment Address:
 _______________________________________________________________________
________________________________________________________________________
________________________________________________________________________
    *(G.2) Incremental Funding. (Applicable to incrementally funded 
contracts.) This contract is incrementally funded pursuant to the 
Limitation of Funds clause, FAR 52.232-22. Funds are hereby obligated in 
the amount of $__________ and it is estimated that they are sufficient 
for contract performance through __________.
    *(G.3) Incremental Funding. (Applicable to incrementally funded 
contracts.) This contract is incrementally funded pursuant to the 
Limitation of Funds clause, FAR 52.232-22. Funds are hereby obligated in 
the amount of $__________ and it is estimated that they are sufficient 
for contract performance through __________. Additional incremental 
funding planned, but not obligated, is:
    (Insert funding schedule.)
    *(G.4) Request for Equal Opportunity Preaward Clearance of 
Subcontracts. (Applicable to subcontracts over $1 million.) To provide 
the Contracting Officer with adequate time to process the Contractor's 
request for preaward clearance of subcontracts as required by FAR 
52.222-28, the prime contractor shall request preaward clearance through 
the Contracting Officer at least 30 calendar days before the proposed 
award date, unless the cognizant Department of Labor Compliance Office 
agrees to a shorter time.
    *(G.5) Contracting Officer's Representative. (To be filled in at 
time of contract award.) The Contracting Officer's representative for 
this contract is:
 _______________________________________________________________________
________________________________________________________________________
________________________________________________________________________
    *(G.6) Invoice Instructions. (Insert invoice instructions.)
    (G.7) Accounting and Appropriation Data (Insert accounting and 
appropriation data.)

                Section H, Special Contract Requirements

    (H.1) Incorporation of Section K by Reference. Pursuant to Federal 
Acquisition Regulation (FAR) 15.406-1(b), Section K of the solicitation 
is hereby incorporated by reference.
    *(H.2) Rent-Free Use of Government Property. The Contractor may use 
on a rent-free, noninterference basis, as necessary for the performance 
of this contract, the Government property accountable under contract(s) 
________. The Contractor is responsible for scheduling the use of all 
property covered by the above referenced contract(s) and the Government 
shall not be responsible for conflicts, delays, or disruptions to any 
work performed by the Contractor due to use of any or all such property 
under this contract or any other contracts under which use of such 
property is authorized.
    *(H.3) Government-Furnished Property. The Government will furnish to 
the Contractor for use in the performance of the contract on a rent-free 
basis the Government-owned property listed in an attachment to this 
contract, subject to the provisions of the Government Property Clause of 
the Contract Clauses.
    (H.4) Scientific/Technical Information. If not already registered, 
the Contractor is encouraged to register for Defense Technical 
Information Center (DTIC) service by contacting the following:
    Defense Technical Information Center, Attn: Registration Section 
(DTIC-BCS), 8725 John J. Kingman Road, Suite 0944, Fort Belvoir, VA 
22060-0944, (703) 767-8273 or 1-800-CAL-DTIC (225-3842), menu selection 
2.
    To avoid duplication of effort and conserve scientific and technical 
resources, the Contractor is encouraged to search existing sources in 
DTIC to determine the current state of the art concepts, studies, etc.
    (H.5) Reserved.
    *(H.6) (Insert nonstandard clause(s) approved in accordance with 
agency procedures, if applicable.)

                        Part II--Contract Clauses

                       Section I, Contract Clauses

                                                                        
                                                                        
                                                                        
(I.1)..............           52.252-2  Clauses Incorporated by         
                                         Reference.                     
(I.2)..............           52.202-1  Definitions.                    
(I.3)..............              (\1\)  ................................
(I.4)..............           52.203-3  Gratuities.                     
(I.5)..............           52.203-5  Covenant Against Contingent     
                                         Fees.                          
(I.6)..............           52.203-7  Anti-Kickback Procedures.       
(I.7)..............          52.203-10  Price or Fee Adjustment for     
                                         Illegal or Improper Activity.  
(I.8)..............           52.209-6  Protecting the Government's     
                                         Interest When Subcontracting   
                                         with Contractors Debarred,     
                                         Suspended, or Proposed for     
                                         Debarment.                     
(I.9)..............              (\1\)  ................................

[[Page 288]]

                                                                        
(I.10).............              (\1\)  ................................
(I.11).............              (\1\)  ................................
(I.12).............          52.215-26  Integrity of Unit Prices.       
(I.13).............          52.215-33  Order of Precedence.            
(I.14).............           52.216-7  Allowable Cost and Payment      
                                         (Modified in accordance with   
                                         16.307 as applicable).         
(I.15).............              (\1\)  ................................
(I.16).............              (\1\)  ................................
(I.17).............              (\1\)  ................................
(I.18).............              (\1\)  ................................
(I.19).............           52.222-3  Convict Labor.                  
(I.20).............          52.222-26  Equal Opportunity.              
(I.21).............          52.222-35  Affirmative Action for Special  
                                         Disabled and Vietnam Era       
                                         Veterans.                      
(I.22).............          52.222-36  Affirmative Action for          
                                         Handicapped Workers.           
(I.23).............          52.222-37  Employment Reports on Special   
                                         Disabled Veterans and Veterans 
                                         of the Vietnam Era.            
(I.24).............           52.223-6  Drug-Free Workplace.            
(I.25).............          52.225-11  Restrictions on Certain Foreign 
                                         Purchases.                     
(I.26).............           52.227-1  Authorization and Consent--     
                                         Alternate I.                   
(I.27).............           52.227-2  Notice and Assistance Regarding 
                                         Patent and Copyright           
                                         Infringement.                  
(I.28).............           52.228-7  Insurance--Liability to Third   
                                         Persons.                       
(I.29).............           52.232-9  Limitation on Withholding of    
                                         Payments.                      
(I.30).............          52.232-23  Assignment of Claims.           
(I.31).............          52.232-25  Prompt Payment.                 
(I.32).............              (\1\)  ................................
(I.33).............           52.233-1  Disputes.                       
(I.34).............           52.233-3  Protest After Award--Alternate  
                                         I.                             
(I.35).............           52.242-1  Notice of Intent to Disallow    
                                         Costs.                         
(I.36).............          52.242-13  Bankruptcy.                     
(I.37).............           52.244-2  Subcontracts (Cost-Reimbursement
                                         and Letter Contracts) Alternate
                                         I.                             
(I.38).............           52.244-5  Competition in Subcontracting.  
(I.39).............           52.247-1  Commercial Bill of Lading       
                                         Notations.                     
(I.40).............          52.249-14  Excusable Delays.               
(I.41).............           52.253-1  Computer-Generated Forms.       
(I.42).............              (\1\)  ................................
(I.43).............              (\1\)  ................................
*(I.44)............           52.204-2  Security Requirements.          
*(I.45)............           52.204-2  Security Requirements--Alternate
                                         I (For educational             
                                         institutions).                 
*(I.46)............          52.215-22  Price Reduction for Defective   
                                         Cost or Pricing Data.          
*(I.47)............          52.215-23  Price Reduction for Defective   
                                         Cost or Pricing Data-          
                                         Modifications.                 
*(I.48)............          52.215-24  Subcontractor Cost or Pricing   
                                         Data.                          
*(I.49)............          52.215-25  Subcontractor Cost or Pricing   
                                         Data-Modifications.            
*(I.50)............          52.215-27  Termination of Defined Benefit  
                                         Pension Plans (Except          
                                         educational institutions).     
*(I.51)............          52.215-31  Waiver of Facilities Capital    
                                         Cost of Money (Except          
                                         educational institutions).     
*(I.52)............          52.215-39  Reversion or Adjustment of Plans
                                         for Postretirement Benefits    
                                         Other than Pension (PRB).      
*(I.53)............           52.216-8  Fixed Fee.                      
*(I.54)............          52.216-10  Incentive Fee.                  
*(I.55)............          52.216-11  Cost Contract--No Fee.          
*(I.56)............          52.216-11  Cost Contact-No Fee--Alternate  
                                         I.                             
*(I.57)............          52.216-12  Cost-Sharing Contract-No Fee.   
*(I.58)............          52.216-12  Cost-Sharing Contract-No Fee--  
                                         Alternate I.                   
*(I.59)............          52.216-15  Predetermined Indirect Cost     
                                         Rates (For educational         
                                         institutions only).            
*(I.59A)...........        52.216-7002  Alternate A (For educational    
                                         institutions only).            
*(I.60)............           52.219-6  Notice of Total Small Business  
                                         Set-Aside.                     
*(I.61)............           52.219-6  Notice of Total Small Business  
                                         Set-Aside--Alternate I.        
(I.62).............              (\1\)  ................................
*(I.63)............              (\1\)  ................................
*(I.64)............          52.219-14  Limitations on Subcontracting.  

[[Page 289]]

                                                                        
*(I.65)............          52.219-16  Liquidated Damages-Small        
                                         Business Subcontracting Plan.  
*(I.66)............              (\1\)  ................................
*(I.67)............           52.222-1  Notice to the Government of     
                                         Labor Disputes.                
*(I.68)............           52.222-2  Payment for Overtime Premiums   
                                         (Insert applicable information 
                                         in paragraph (a)).             
*(I.69)............          52.222-28  Equal Opportunity Preaward      
                                         Clearance of Subcontracts.     
*(I.70)............           52.223-2  Clean Air and Water.            
*(I.71)............           52.223-3  Hazardous Material              
                                         Identification and Material    
                                         Safety Data.                   
*(I.72)............           52.223-7  Notice of Radioactive Materials 
                                         (Insert in paragraph (a): 21). 
*(I.73)............           52.226-1  Utilization of Indian           
                                         Organizations and Indian-Owned 
                                         Economic Enterprises.          
*(I.74)............          52.227-10  Filing of Patent Applications-  
                                         Classified Subject Matter.     
*(I.75)............          52.227-11  Patent Rights-Retention by the  
                                         Contractor (Short Form).       
*(I.76)............          52.227-12  Patent Rights-Retention by the  
                                         Contractor (Long Form).        
*(I.77)............          52.227-13  Patent Rights-Acquisition by the
                                         Government.                    
(I.78).............              (\1\)  ................................
(I.79).............              (\1\)  ................................
*(I.80)............           52.229-8  Taxes--Foreign Cost-            
                                         Reimbursement Contracts.       
*(I.81)............          52.229-10  State of New Mexico Gross       
                                         Receipts and Compensating Tax  
                                         (Insert applicable information 
                                         in paragraph (c)).             
*(I.82)............           52.230-2  Cost Accounting Standards       
                                         (Except if exempted).          
*(I.83)............           52.230-3  Disclosure and Consistency of   
                                         Cost Accounting Practices      
                                         (Except if exempted).          
*(I.84)............           52.230-6  Administration of Cost          
                                         Accounting Standards (Except   
                                         educational institutions).     
*(I.85)............          52.232-17  Interest.                       
*(I.86)............          52.232-20  Limitation of Cost.             
*(I.87)............          52.232-22  Limitation of Funds.            
*(I.88)............          52.232-23  Assignment of Claims-Alternate  
                                         I.                             
*(I.89)............           52.233-1  Disputes-Alternate I.           
*(I.90)............           52.237-2  Protection of Government        
                                         Buildings, Equipment and       
                                         Vegetation.                    
*(I.91)............          52.242-10  F.O.B. Origin-Government Bills  
                                         of Lading or Prepaid Postage.  
*(I.92)............          52.242-11  F.O.B. Origin-Government Bills  
                                         of Lading or Indicia Mail.     
*(I.93)............          52.242-12  Report of Shipment (REPSHIP).   
*(I.94)............           52.243-2  Changes--Cost-Reimbursement-    
                                         Alternate V.                   
*(I.95)............           52.243-6  Change Order Accounting.        
*(I.96)............           52.243-7  Notification of Changes (30     
                                         Calendar Days).                
*(I.97)............           52.245-5  Government Property (Cost-      
                                         Reimbursement, Time-and-       
                                         Material, or Labor-Hour        
                                         Contracts).                    
*(I.98)............           52.245-5  Government Property (Cost-      
                                         Reimbursement, Time-and-       
                                         Material, or Labor-Hour        
                                         Contracts)-Alternate I (For    
                                         educational institutions and   
                                         nonprofit organizations).      
*(I.99)............          52.245-19  Government Property Furnished   
                                         ``As Is''.                     
*(I.100)...........          52.246-23  Limitation of Liability.        
*(I.101)...........          52.246-24  Limitation of Liability-High    
                                         Value Items.                   
*(I.102)...........          52.246-24  Limitation of Liability-High    
                                         Value Items-Alternate I.       
*(I.103)...........          52.246-25  Limitation of Liability-        
                                         Services.                      
*(I.104)...........          52.247-63  Preference for U.S.-Flag Air    
                                         Carriers.                      
*(I.105)...........          52.247-66  Returnable Cylinder.            
*(I.106)...........           52.249-5  Termination for Convenience of  
                                         the Government (Educational and
                                         Other Nonprofit Institutions). 
*(I.107)...........           52.249-6  Termination (Cost-              
                                         Reimbursement).                
*(I.108)...........           52.251-1  Government Supply Sources.      
(I.109)............       252.201-7000  Contracting Officer's           
                                         Representative.                
(I.110)............       252.203-7001  Special Prohibition on          
                                         Employment.                    
(I.111)............              (\1\)  ................................
(I.112)............              (\1\)  ................................
(I.113)............       252.204-7003  Control of Government Personnel 
                                         Work Product.                  
(I.114)............       252.209-7000  Acquisitions from Subcontractors
                                         Subject to On-Site Inspection  
                                         under the Intermediate-Range   
                                         Nuclear Forces (INF) Treaty.   
(I.115)............       252.225-7012  Preference for Certain Domestic 
                                         Commodities.                   
(I.116)............       252.225-7031  Secondary Arab Boycott of       
                                         Israel.                        
(I.117)............              (\1\)  ................................
(I.118)............              (\1\)  ................................
(I.119)............              (\1\)  ................................

[[Page 290]]

                                                                        
(I.120)............       252.227-7030  Technical Data-Withholding of   
                                         Payment.                       
(I.121)............       252.227-7037  Validation of Restrictive       
                                         Markings on Technical Data.    
(I.122)............       252.231-7000  Supplemental Cost Principles.   
(I.123)............       252.232-7006  Reduction or Suspension of      
                                         Contract Payments Upon Finding 
                                         of Fraud.                      
(I.124)............       252.242-7000  Postaward Conference.           
(I.125)............              (\1\)  ................................
(I.126)............       252.247-7023  Transportation of Supplies by   
                                         Sea.                           
*(I.127)...........              (\1\)  ................................
*(I.128)...........       252.203-7002  Display of DoD Hotline Poster.  
*(I.129)...........       252.204-7000  Disclosure of Information.      
*(I.130)...........       252.204-7002  Payment for Subline Items Not   
                                         Separately Priced.             
*(I.131)...........       252.205-7000  Provision of Information to     
                                         Cooperative Agreement Holders. 
*(I.132)...........       252.215-7000  Pricing Adjustments.            
*(I.133)...........       252.215-7002  Cost Estimating System          
                                         Requirements.                  
*(I.134)...........       252.219-7001  Notice of Partial Small Business
                                         Set-Aside with Preferential    
                                         Consideration for Small        
                                         Disadvantaged Business         
                                         Concerns.                      
*(I.134A)..........       252.219-7001  Notice of Partial Small Business
                                         Set-Aside with Preferential    
                                         Consideration for Small        
                                         Disadvantaged Business         
                                         Concerns, Alternate I.         
*(I.135)...........       252.219-7002  Notice of Small Disadvantaged   
                                         Business Set-Aside.            
*(I.135A)..........       252.219-7002  Notice of Small Disadvantaged   
                                         Business Set-Aside, Alternate  
                                         I.                             
*(I.136)...........       252.219-7003  Small Business and Small        
                                         Disadvantaged Business         
                                         Subcontracting Plan (DoD       
                                         Contracts).                    
*(I.137)...........       252.219-7004  Small Business and Small        
                                         Disadvantaged Business         
                                         Subcontracting Plan (Test      
                                         Program).                      
*(I.138)...........       252.219-7005  Incentive for Subcontracting    
                                         with Small Businesses, Small   
                                         Disadvantaged Businesses,      
                                         Historically Black Colleges and
                                         Universities and Minority      
                                         Institutions (. . . To be      
                                         negotiated ____%).             
*(I.139)...........       252.219-7005  Incentive for Subcontracting    
                                         with Small Businesses, Small   
                                         Disadvantaged Businesses,      
                                         Historically Black Colleges and
                                         Universities and Minority      
                                         Institutions--ALTERNATE I (. . 
                                         . To be negotiated ____%).     
*(I.140)...........       252.219-7006  Notice of Evaluation Preference 
                                         for Small Disadvantaged        
                                         Business Concerns.             
*(I.141)...........       252.223-7001  Hazard Warning Labels.          
*(I.142)...........       252.223-7002  Safety Precautions for          
                                         Ammunitions and Explosives.    
*(I.143)...........       252.223-7003  Change in Place of Performance--
                                         Ammunition and Explosives.     
*(I.144)...........       252.223-7004  Drug-Free Work Force.           
*(I.145)...........       252.225-7014  Preference for Domestic         
                                         Specialty Metals.              
*(I.146)...........       252.225-7016  Restriction on Acquisition of   
                                         Ball and Roller Bearings.      
*(I.147)...........       252.225-7025  Foreign Source Restrictions.    
*(I.148)...........       252.225-7026  Reporting of Contract           
                                         Performance Outside the United 
                                         States.                        
*(I.149)...........       252.225-7032  Waiver of United Kingdom Levies.
*(I.150)...........       252.226-7000  Notice of Historically Black    
                                         College or University and      
                                         Minority Institution Set-Aside.
*(I.151)...........       252.227-7026  Deferred Delivery of Technical  
                                         Data or Computer Software.     
*(I.152)...........       252.227-7027  Deferred Ordering of Technical  
                                         Data or Computer Software.     
*(I.153)...........                (1)                                  
*(I.154)...........       252.227-7034  Patent--Subcontracts.           
(I.155)............       252.227-7036  Declaration of Technical Data   
                                         Conformity.                    
*(I.156)...........       252.227-7039  Patents--Reporting of Subject   
                                         Inventions.                    
*(I.157)...........                (1)                                  
*(I.158)...........       252.232-7000  Advance Payment Pool (For       
                                         educational institutions and   
                                         nonprofit organizations).      
*(I.159)...........                (1)                                  
*(I.160)...........       252.235-7002  Animal Welfare.                 
*(I.161)...........       252.242-7002  Submission of Commercial Freight
                                         Bills for Audit.               
*(I.162)...........       252.242-7003  Application for U.S. Government 
                                         Shipping. Documentation/       
                                         Instructions.                  
*(I.163)...........       252.242-7004  Material Management and         
                                         Accounting System.             
*(I.164)...........       252.245-7001  Reports of Government Property. 
*(I.165)...........       252.247-7024  Notification of Transportation  
                                         of Supplies by Sea.            

[[Page 291]]

                                                                        
*(I.166)...........           Reserved                                  
*(I.167)...........       252.251-7000  Ordering From Government Supply 
                                         Sources.                       
*(I.168)...........       252.223-7006  Prohibition on Disposal of Toxic
                                         and Hazardous Materials.       
*(I.169)...........       252.249-7002  Notification of Anticipated     
                                         Contract Termination or        
                                         Reduction.                     
(I.170)............           52.204-4  Printing/Copying Double-Sided on
                                         Recycled Paper.                
*(I.171)...........           52.208-8  Helium Requirement Forecast and 
                                         Required Sources for Helium.   
(I.172)............           52.215-2  Audit and Records--Negotiation. 
*(I.173)...........           52.215-2  Audit and Records--Negotiation, 
                                         Alternate II.                  
(I.174)............          52.215-40  Notification of Ownership       
                                         Changes.                       
*(I.175)...........          52.215-42  Requirements for Cost or Pricing
                                         Data or Information. Other Than
                                         Cost or Pricing Data--         
                                         Modifications.                 
*(I.176)...........          52.215-42  Requirements for Cost or Pricing
                                         Data or Information. Other Than
                                         Cost or Pricing Data--         
                                         Modifications, Alternate II.   
*(I.177)...........          52.215-42  Requirements for Cost or Pricing
                                         Data or Information. Other Than
                                         Cost or Pricing Data--         
                                         Modifications, Alternate III.  
(I.178)............           52.219-8  Utilization of Small, Small     
                                         Disadvantaged and Women-Owned  
                                         Small Business Concerns.       
*(I.179)...........           52.219-9  Small, Small Disadvantaged and  
                                         Women-Owned Small Business     
                                         Subcontracting Plan.           
*(I.179A)..........           52.219-9  Small, Small Disadvantaged and  
                                         Women-Owned Small Business     
                                         Subcontracting Plan--Alternate 
                                         II.                            
*(I.180)...........           52.242-3  Penalties for Unallowable Costs.
(I.181)............           52.242-4  Certification of Indirect Costs.
(I.182)............           52.244-6  Subcontracts for Commercial     
                                         Items and Commercial           
                                         Components.                    
*(I.183)...........          52.247-67  Submission of Commercial        
                                         Transportation Bills to the    
                                         General Services Administration
                                         for Audit.                     
(I.184)............          52.223-14  Toxic Chemical Release          
                                         Reporting.                     
(I.185)............       252.235-7010  Acknowledgement of Support and  
                                         Disclaimer.                    
(I.186)............       252.235-7011  Final Scientific or Technical   
                                         Report.                        
*(I.187)...........       252.227-7013  Rights in Technical Data--      
                                         Noncommercial Items.           
*(I.188)...........       252.227-7013  Rights in Technical Data--      
                                         Noncommercial Items, Alternate 
                                         I.                             
*(I.189)...........       252.227-7014  Rights in Noncommercial Computer
                                         Software and Noncommercial     
                                         Computer Software              
                                         Documentation.                 
*(I.190)...........       252.227-7014  Rights in Noncommercial Computer
                                         Software and Noncommercial     
                                         Computer Software              
                                         Documentation--Alternate I.    
*(I.191)...........       252.227-7015  Technical Data--Commercial      
                                         Items.                         
(I.192)............       252.227-7016  Rights in Bid or Proposal       
                                         Information.                   
*(I.193)...........       252.227-7018  Rights in Noncommercial         
                                         Technical Data and Computer    
                                         Software--Small Business       
                                         Innovation Research Program.   
*(I.194)...........       252.227-7018  Rights in Noncommercial         
                                         Technical Data and Computer    
                                         Software--Small Business       
                                         Innovation Research Program,   
                                         Alternate I.                   
*(I.195)...........       252.227-7019  Validation of Asserted          
                                         Restrictions--Computer         
                                         Software.                      
*(I.196)...........       252.227-7025  Limitations on the Use or       
                                         Disclosure of Government-      
                                         Furnished Information Marked   
                                         With Restrictive Legends.      
*(I.197)...........       252.209-7005  Military Recruiting on Campus   
                                         (For educational institutions  
                                         only).                         
(I.198)............           52.203-6  Restrictions on Subcontractor   
                                         Sales to the Government.       
(I.199)............           52.203-8  Cancellation, Recission, and    
                                         Recovery of Funds for Illegal  
                                         or Improper Activity.          
(I.200)............          52.203-12  Limitation on Payments to       
                                         Influence Certain Federal      
                                         Transactions.                  
*(I.201)...........          52.211-15  Defense Priority and Allocation 
                                         Requirements.                  
*(I.202)...........          52.215-42  Requirements for Cost or Pricing
                                         Data or Information Other Than 
                                         Cost or Pricing Data--         
                                         Modifications, Alternative IV. 
*(I.203)...........           52.230-5  Cost Accounting Standards--     
                                         Educational Institution.       
*(I.204)...........          52.232-18  Availability of Funds.          
(I.205)............          52.232-33  Mandatory Information for       
                                         Electronic Funds Transfer      
                                         Payment.                       
*(I.206)...........          52.245-18  Special Test Equipment.         
*(I.207)...........           52.252-6  Authorized Deviations in        
                                         Clauses.                       
*(I.208)...........       252.209-7004  Reporting of Commercial         
                                         Transactions with the          
                                         Government of a Terrorist      
                                         Country.                       

[[Page 292]]

                                                                        
*(I.209)...........       252.223-7007  Safeguarding Sensitive          
                                         Conventional Arms, Ammunition  
                                         and Explosives.                
*(I.210)...........         252.223-11  Ozone-Depleting Substances.     
*(I.211)...........       252.243-7002  Certification of Requests for   
                                         Equitable Adjustment           
                                                                        
\1\ Reserved.                                                           

      Part III--List of Documents, Exhibits, and Other Attachments

                     Section J, List of Attachments

    Use attachments and exhibits to inform the contractor of local 
information such as:
    (1) Procedures for laboratory access;
    (2) Laboratory hours of operation;
    (3) Special procedures related to unique laboratory working 
environments which are not covered by FAR or DFARS; and
    (4) Base support or government property information.
    *(J.1) List of Attachments:
    *(J.2) List of Exhibits:

                Part IV--Representations and Instructions

   Section K, Representations, Certifications and Other Statements of 
                           Offerors or Quoters

    The following solicitation provisions require representations, 
certifications, or the submission of other information by offerors. They 
are mandatory, and are included by reference. Full text copies of these 
provisions are available from the Contracting Officer and must be 
completed before contract award.

                                                                        
                                                                        
                                                                        
(K.1)..............              (\1\)  ................................
(K.2)..............              (\1\)  ................................
(K.3)..............          52.203-11  Certification and Disclosure    
                                         Regarding Payments to Influence
                                         Certain Federal Transactions.  
(K.4)..............           52.204-3  Taxpayer Identification.        
(K.5)..............           52.209-5  Certification Regarding         
                                         Debarment, Suspension, Proposed
                                         Debarment, and Other           
                                         Responsibility Matters.        
(K.6)..............           52.215-6  Type of Business Organization.  
(K.7)..............          52.215-11  Authorized Negotiators.         
(K.8)..............          52.215-20  Place of Performance.           
(K.9)..............              (\1\)  ................................
(K.10).............              (\1\)  ................................
(K.11).............              (\1\)  ................................
(K.12).............              (\1\)  ................................
(K.13).............          52.222-21  Certification of Nonsegregated  
                                         Facilities.                    
(K.14).............          52.222-22  Previous Contracts and          
                                         Compliance Reports.            
(K.15).............          52.222-25  Affirmative Action Compliance.  
(K.16).............           52.223-1  Clean Air and Water             
                                         Certification.                 
(K.17).............              (\1\)  ................................
(K.18).............           52.227-6  Royalty Information.            
(K.19).............           52.230-1  Cost Accounting Standards       
                                         Notices and Certification.     
(K.20).............              (\1\)  ................................
(K.21).............       252.209-7002  Disclosure of Ownership or      
                                         Control by a Foreign           
                                         Government.                    
(K.22).............       252.219-7000  Small Disadvantaged Business    
                                         Concern Representation (DoD    
                                         Contracts).                    
(K.23).............              (\1\)  ................................
(K.24).............              (\1\)  ................................
(K.25).............       252.226-7001  Historically Black College or   
                                         University and Minority        
                                         Institution Status.            
(K.26).............              (\1\)  ................................
(K.27).............       252.247-7022  Representation of Extent of     
                                         Transportation by Sea.         
(K.28).............           52.204-5  Women-Owned Business.           
(K.29).............              (\1\)  ................................
(K.30).............           52.219-1  Small Business Program          
                                         Representation.                
(K.31).............          52.223-13  Certification of Toxic Chemical 
                                         Release Reporting.             
(K.32).............       252.209-7001  Disclosure of Ownership or      
                                         Control by the Government of a 
                                         Terrorist Country.             
(K.33).............       252.209-7003  Disclosure of Commercial        
                                         Transactions with the          
                                         Government of a Terrorist      
                                         Country.                       
(K.34).............       252.209-7004  Reporting of Commercial         
                                         Transactions with the          
                                         Government of a Terrorist      
                                         Country.                       

[[Page 293]]

                                                                        
(K.35).............              (\1\)  ................................
(K.36).............              (\1\)  ................................
(K.37).............           52.226-2  Historically Black College or   
                                         University and Minority        
                                         Institution Representation.    
                                                                        
 Section L. Instructions, Conditions, and Notices to Offerors or Quoters
                                                                        
(L.1)..............           52.252-1  Solicitation Provisions         
                                         Incorporated by Reference.     
(L.2)..............              (\1\)  ................................
(L.3)..............           52.211-2  Availability of Specifications  
                                         and Standards Listed in the DoD
                                         Index of Specifications and    
                                         Standards (DODISS).            
(L.4)..............           52.215-5  Solicitation Definitions.       
(L.5)..............           52.215-7  Unnecessarily Elaborate         
                                         Proposals or Quotations.       
(L.6)..............           52.215-8  Amendments to Solicitations.    
(L.7)..............           52.215-9  Submission of Offers.           
(L.8)..............          52.215-10  Late Submissions, Modifications,
                                         and Withdrawals of Proposals.  
(L.9)..............          52.215-12  Restriction on Disclosure and   
                                         Use of Data.                   
(L.10).............          52.215-13  Preparation of Offers.          
(L.11).............          52.215-14  Explanation to Prospective      
                                         Offerors.                      
(L.12).............          52.215-15  Failure to Submit Offer.        
(L.13).............          52.215-16  Contract Award.                 
*(L.14)............              (\1\)  ................................
(L.15).............           52.216-1  Type of Contract (See           
                                         235.7006(d)(B.1)).             
(L.16).............          52.222-24  Preaward On-Site Equal          
                                         Opportunity Compliance Review. 
(L.17).............              (\1\)  ................................
(L.18).............           52.233-2  Service of Protest (See         
                                         235.7006(d)(A.1)(xvii)).       
*(L.19)............           52.237-1  Site Visit.                     
(L.20).............           52.252-5  Authorized Deviations in        
                                         Provisions.                    
(L.21).............       252.204-7001  Commercial and Government Entity
                                         (CAGE) Code Reporting.         
(L.22).............              (\1\)  ................................
(L.23).............          52.215-16  Contract Award--Alternate II.   
*(L.24)............          52.215-41  Requirements for Cost or Pricing
                                         Data or Information Other Than 
                                         Cost or Pricing Data.          
*(L.25)............          52.215-41  Requirements for Cost or Pricing
                                         Data or Information Other Than 
                                         Cost or Pricing Data, Alternate
                                         I.                             
*(L.26)............          52.215-41  Requirements for Cost or Pricing
                                         Data or Information Other Than 
                                         Cost or Pricing Data, Alternate
                                         II.                            
*(L.27)............          52.215-41  Requirements for Cost or Pricing
                                         Data or Information Other Than 
                                         Cost or Pricing Data, Alternate
                                         III.                           
*(L.28)............          52.215-41  Requirements for Cost or Pricing
                                         Data or Information Other Than 
                                         Cost or Pricing Data, Alternate
                                         IV.                            
(L.29).............       252.227-7017  Identification and Assertion of 
                                         Use, Release, or Disclosure    
                                         Restrictions.                  
(L.30).............       252.227-7028  Technical Data or Computer      
                                         Software Previously Delivered  
                                         to the Government.             
*(L.31)............          52.215-30  Facilities Capital Cost of Money
                                         (Except educational            
                                         institutions).                 
(L.32).............           52.204-6  Contractor Identification       
                                         Number--Data Universal         
                                         Numbering System (DUNS) Number.
*(L.33)............          52.211-14  Notice of Priority Rating for   
                                         National Defense Use.          
                                                                        

    (L.34 through L.99) Reserved.
    *(L.100) (Insert special instructions, conditions, or notices to 
offerors, if applicable).
    (L.101) Government-Furnished Property.
    No material, labor, or facilities will be furnished by the 
Government unless provided for in the solicitation.
    (L.102) Proposal Preparation and Submission Instructions.
    (i) Page limitation, format.
    (A) A proposal shall be prepared in separate volumes with the page 
limit and number of copies specified as follows. The table of contents 
and tabs are exempt from the page limits. No cross-referencing between 
volumes for essential information is permitted except where specifically 
set forth herein. The following volumes of material will be submitted:

[[Page 294]]



                                                                        
------------------------------------------------------------------------
                                                                Maximum 
             Title                          Copies                page  
                                                                 limits 
------------------------------------------------------------------------
Cost..........................  As specified in solicitation        * 50
                                 summary.                               
Technical.....................  As specified in solicitation         100
                                 summary.                               
------------------------------------------------------------------------
* The 50-page cost proposal is a goal not a limit. The Contractor may   
  use additional pages if necessary to comply with public law.          

    (B) Any technical proposal pages submitted that exceed the page 
limitations set forth in paragraph (i)(A) of this subsection L.102 will 
not be read or evaluated. Proposal pages failing to meet the format in 
paragraph (i)(D) of this subsection L.102 will not be read or evaluated.
    (C) No program cost data or cross-reference to the cost proposal 
will be included in any other volume.
    (D) Format of the proposal volumes shall be as follows:
    (1) Proposals will be prepared on 8\1/2\ x 11 inch paper except for 
foldouts used for charts, tables, or diagrams, which may not exceed 11 x 
17 inches. Foldouts will not be used for text. Pages will have a one 
inch margin.
    (2) A page is defined as one face of a sheet of paper containing 
information. Two pages may be printed on one sheet.
    (3) Type size will be no smaller than 10 point character height 
(vertical size) and no more than an average of 12 characters per inch. 
Use of type-setting techniques to reduce type size below 10 points or to 
increase characters beyond 12 per inch is not permitted. Such techniques 
are construed as a deliberate attempt to circumvent the intent of page 
limitations set forth in paragraph (i)(A) of this subsection L.102.
    (4) Proposal must lie flat when open; elaborate binding is not 
desirable.
    (5) No models, mockups, or video tapes will be accepted.
    (6) Technical proposals will be prepared in the same sequence as the 
statement of work.
    (ii) Content.
    All proposals must be complete and respond directly to the 
requirements of the solicitation. The factors and subfactors listed in 
Section M of the solicitation shall be addressed. Cost and supporting 
data shall be included only in the cost volume. All other information 
shall be included in the technical volume.
    (L.103) The Government may make multiple awards resulting from this 
solicitation.

                 Section M, Evaluation Factors for Award

    Use of the standard evaluation factors is preferred. If the standard 
evaluation factors are modified in any way, the modifications must be 
clearly expressed so that the result is unambiguous. Additions to and 
deletions from the contents of this Section M must be clearly annotated 
in the solicitation summary (see 235.7006(d)(A.1)(vii)).
    *(M.1) FAR 52.217-5 Evaluation of Options (Applicable if the 
solicitation indicates that options are anticipated in the resulting 
contract. When this provision is included, evaluation criteria for 
options shall be included in Section M.)
    *(M.2) Proposal Evaluation Procedures and Basis for Award. Proposals 
will be evaluated and award made as follows:
    (i) Basis for award.
    The award decision will be based on evaluation of all factors and 
subfactors set forth in this solicitation. The Government may select the 
source whose proposal offers the greatest value to the Government in 
terms of technical, cost or price, and other factors set forth in the 
solicitation. The source selected may or may not have the lowest 
proposed total costs.
    (ii) Evaluation factors.
    Proposals will be evaluated in accordance with the following 
factors. The technical factor is more important than the cost factor. 
The technical subfactors are in descending order of importance unless 
otherwise stated in the solicitation. The cost subfactors are of equal 
weight.
    (A) Technical.
    (1) Technical approach. The soundness of the offeror's technical 
approach, including the offeror's demonstrated understanding of the 
technical requirement.
    (2) Qualification. The experience and qualifications of the proposed 
personnel relevant to the proposed task. The quantity and quality of the 
offeror's

[[Page 295]]

corporate experience relevant to the proposed task.
    (3) Management. The degree to which the offeror demonstrates the 
ability to effectively and efficiently manage and administer the program 
to a successful conclusion.
    (4) Facilities. The degree to which the proposed facilities enable 
accomplishment of the proposed effort.
    (B) Cost.
    (1) Reasonableness. Proposed estimated cost and fee (if any).
    (2) Completeness. The adequacy of the identification, estimation and 
support of all relevant costs.
    (3) Realism. The consistency of the cost proposal with the technical 
effort proposed, the organizational structure, method of operations and 
cost accounting practices.
    *(M.3) 52.215-34  Evaluation of Offers for Multiple Awards.
[62 FR 16100, Apr. 4, 1997, as amended at 62 FR 37147, July 11, 1997; 62 
FR 49305, Sept. 19, 1997]



PART 236--CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS--Table of Contents




Sec.

                         Subpart 236.1--General

236.102  Definitions.

     Subpart 236.2--Special Aspects of Contracting for Construction

236.201  Evaluation of contractor performance.
236.203  Government estimate of construction costs.
236.204  Disclosure of the magnitude of construction projects.
236.206  Liquidated damages.
236.270  Expediting construction contracts.
236.271  Cost-plus-fixed-fee contracts.
236.272  Prequalification of sources.
236.273  Network analysis systems.
236.274  Construction in foreign countries.

    Subpart 236.3--Special Aspects of Sealed Bidding in Construction 
                               Contracting

236.303  Invitations for bids.
236.303-70  Additive or deductive items.

   Subpart 236.4--Special Procedures for Negotiation of Construction 
                                Contracts

236.403  Cost-reimbursement contracts.

                     Subpart 236.5--Contract Clauses

236.570  Additional provisions and clauses.

               Subpart 236.6--Architect-Engineer Services

236.601  Policy.
236.602  Selection of firms for architect-engineer contracts.
236.602-1  Selection criteria.
236.602-2  Evaluation boards.
236.602-4  Selection authority.
236.602-70  Restriction on award of overseas architect-engineer 
          contracts to foreign firms.
236.604  Performance evaluation.
236.606  Negotiations.
236.606-70  Statutory fee limitation.
236.609  Contract clauses.
236.609-70  Additional provision and clause.

     Subpart 236.7--Standard and Optional Forms for Contracting for 
Construction, Architect-Engineer Services, and Dismantling, Demolition, 
                       or Removal of Improvements

236.701  Standard and optional forms for use in contracting for 
          construction or dismantling, demolition, or removal of 
          improvements.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36421, July 31, 1991, unless otherwise noted.



                         Subpart 236.1--General



236.102  Definitions.

    (1) A-E means architect-engineer.
    (2) Construction activity means an activity at any organizational 
level of the DoD that--
    (i) Is responsible for the architectural, engineering, and other 
related technical aspects of the planning, design, and construction of 
facilities; and
    (ii) Receives its technical guidance from the Army Office of the 
Chief of Engineers, Naval Facilities Engineering Command, or Air Force 
Directorate of Civil Engineering.
    (3) Network analysis system means recognized scheduling systems that 
show the duration, sequential relationship, and interdependence of 
various work activities, e.g., critical path method.
    (4) United States firm is defined in the provisions at 252.236-7010, 
Overseas Military Construction-Preference for United States Firms, and 
252.236-7011,

[[Page 296]]

Overseas Architect-Engineer Services-Restriction to United States firms.
[56 FR 36421, July 31, 1991, as amended at 62 FR 2857, Jan. 17, 1997]



     Subpart 236.2--Special Aspects of Contracting for Construction



236.201  Evaluation of contractor performance.

    (a) Preparation of performance evaluation reports. Use DD Form 2626, 
Performance Evaluation (Construction), instead of SF 1420.
    (c) Distribution and use of performance reports. (1) Send each 
contractor performance evaluation report to the central data base 
immediately upon its completion.
    (A) The central data base--
    (1) Is operated by--

U.S. Army Engineer Division, North Pacific, ATTN: CENPD-CT, P.O. Box 
    2870, Portland, OR 97208-2870, Telephone: (503)326-3459/4910

    (2) Keeps reports on file for six years.
    (B) For computer access to the files, contact the North Pacific 
Division for user log-on and procedures.
    (2) Use performance records when making responsibility 
determinations under FAR 9.1.
    (A) For each contract expected to exceed $1,000,000, retrieve all 
performance records on file in the central data base for all prospective 
contractors that have a reasonable chance of being selected for award. 
The central data base will provide--
    (1) Overall current performance ratings;
    (2) Descriptions of contracts on which ratings are based (e.g., type 
of facility, contract value, applicable performance elements); and
    (3) A telephone number to obtain transcripts and documentation of 
pertinent evaluation details.
    (B) Consider using the performance records in the data base for 
lower value contracts and to assess a contractor's performance record 
for reasons other than an award decision, such as subcontractor approval 
and awards for excellence.
[56 FR 36421, July 31, 1991, as amended at 61 FR 7749, Feb. 29, 1996]



236.203  Government estimate of construction costs.

    (c)(i) Designate the Government estimate as ``For Official Use 
Only,'' unless the information is classified. If it is, handle the 
estimate in accordance with security regulations.
    (ii) For sealed bid acquisitions--
    (A) File a sealed copy of the Government estimate with the bids. (In 
the case of two-step acquisitions, this is done in the second step.)
    (B) After the bids are read and recorded, remove the ``For Official 
Use Only'' designation and read and record the estimate as if it were a 
bid, in the same detail as the bids.



236.204  Disclosure of the magnitude of construction projects.

    Additional price ranges are--
    (i) Between $10,000,000 and $25,000,000;
    (ii) Between $25,000,000 and $100,000,000;
    (iii) Between $100,000,000 and $250,000,000;
    (iv) Between $250,000,000 and $500,000,000; and
    (v) Over $500,000,000.
[61 FR 7749, Feb. 29, 1996]



236.206  Liquidated damages.

    See 212.204 for instructions on use of liquidated damages.



236.270  Expediting construction contracts.

    (a) 10 U.S.C. 2858 requires agency head approval to expedite the 
completion date of a contract funded by a Military Construction 
Appropriations Act, if additional costs are involved. This approval 
authority may not be redelegated. The approval authority must--
    (1) Certify that the additional expenditures are necessary to 
protect the National interest; and
    (2) Establish a reasonable completion date for the project.
    (b) The contracting officer may approve an expedited completion date 
if no additional costs are involved.

[[Page 297]]



236.271  Cost-plus-fixed-fee contracts.

    Annual military construction appropriations acts restrict the use of 
cost-plus-fixed-fee contracts (see 216.306(c)).
[61 FR 7749, Feb. 29, 1996]



236.272  Prequalification of sources.

    (a) Prequalification procedures may be used when necessary to ensure 
timely and efficient performance of critical construction projects. 
Prequalification--
    (1) Results in a list of sources determined to be qualified to 
perform a specific construction contract; and
    (2) Limits offerors to those with proven competence to perform in 
the required manner.
    (b) The head of the contracting activity must--
    (1) Authorize the use of prequalification by determining, in 
writing, that a construction project is of an urgency or complexity that 
requires prequalification; and
    (2) Approve the prequalification procedures.
    (c) For small businesses, the prequalification procedures must 
require the qualifying authority to--
    (1) Request a preliminary recommendation from the appropriate Small 
Business Administration regional office, if the qualifying authority 
believes a small business is not responsible;
    (2) Permit the small business to submit a bid or proposal if the 
preliminary recommendation is that the small business is responsible; 
and
    (3) Follow the procedures in FAR 19.6, if the small business is in 
line for award and is found nonresponsible.



236.273  Network analysis systems.

    Use head of the contracting activity approved procedures for 
preparing and using network analysis systems, whether contractor 
prepared, or Government prepared.



236.274  Construction in foreign countries.

    (a) In accordance with Section 112 of Public Law 104-32 and similar 
sections in subsequent military construction appropriations acts, 
military construction contracts that are estimated to exceed $1,000,000 
and are to be performed in the United States territories and possessions 
in the Pacific and on Kwajalein Atoll, or in countries bordering the 
Arabian Gulf, shall be awarded only to United States firms, unless the 
lowest responsive and responsible offer of a United States firm exceeds 
the lowest responsive and responsible offer of a foreign firm by more 
than 20 percent.
    (b)When a technical working agreement with a foreign government is 
required for a construction contract--
    (1) Consider inviting the Army Office of the Chief of Engineers, or 
the Naval Facilities Engineering Command to participate in the 
negotiations.
    (2) The agreement should, as feasible and where not otherwise 
provided for in other agreements, cover all elements necessary for the 
construction that are required by laws, regulations, and customs of the 
United States and the foreign government, including--
    (i) Acquisition of all necessary rights;
    (ii) Expeditious, duty-free importation of labor, material, and 
equipment;
    (iii) Payment of taxes applicable to contractors, personnel, 
materials, and equipment;
    (iv) Applicability of workers' compensation and other labor laws to 
citizens of the U.S., the host country, and other countries;
    (v) Provision of utility services;
    (vi) Disposition of surplus materials and equipment;
    (vii) Handling of claims and litigation; and
    (viii) Resolution of any forseeable problems that can be 
appropriately included in the agreement.
[56 FR 36421, July 31, 1991, as amended at 62 FR 2856, Jan. 17, 1997; 62 
FR 34127, June 24, 1997]



    Subpart 236.3--Special Aspects of Sealed Bidding in Construction 
                               Contracting



236.303  Invitations for bids.



236.303-70  Additive or deductive items.

    (a) If it appears that sufficient funds may not be available for all 
the desired

[[Page 298]]

construction features, consider using a bid schedule with--
    (1) A first or base bid item covering the work generally as 
specified; and
    (2) A list of priorities that contains one or more additive or 
deductive bid items which progressively add or omit specified features 
of the work in a stated order of priority. (Normally, do not mix 
additive and deductive bid items in the same solicitation.)
    (b) Before opening the bids, record in the contract file the amount 
of funds available for the project.
    (c) Determine the low bidder and the bid items to be awarded as 
follows--
    (1) Use the recorded amount of available funds to determine the low 
bidder, which will be the bidder that--
    (i) Is otherwise eligible for award; and
    (ii) Offers the lowest aggregate amount for the first or base bid 
item, plus or minus (in order of listed priority), those additive or 
deductive bid items that provide the most features within the funds 
available.
    (2) Evaluate all bids, including those using the procedures in 
219.7203, on the basis of the same additive or deductive bid items.
    (i) If adding another item from the bid schedule list of priorities 
would make the award exceed the available funds, skip that item and go 
to the next item from the list of priorities.
    (ii) Add the next item if an award can be made that includes the 
item and is still within the available funds.
    (3) Use the list of priorities only to determine the low bidder. 
After determining the low bidder, an award may be made on any 
combination if--
    (i) It is in the best interests of the Government;
    (ii) Funds are available at time of award; and
    (iii) The low bidder's price for the combination is less than the 
price offered by any other responsive, responsible bidder.
[56 FR 36421, July 31, 1991, as amended at 61 FR 18688, Apr. 29, 1996]



   Subpart 236.4--Special Procedures for Negotiation of Construction 
                                Contracts



236.403  Cost-reimbursement contracts.

    (1) For cost-plus-fixed-fee contracts, negotiate the fee for a prime 
contractor using departmental procedures approved by the Assistant 
Secretary of Defense (Production and Logistics).
    (2) For cost-plus-incentive-fee contracts, negotiate the target fee 
for a prime contractor using the criteria and fee schedule in 
departmental procedures to determine--
    (i) The reasonableness of the target cost;
    (ii) The maximum and minimum fees to be established; and
    (iii) The fee adjustment formula.



                     Subpart 236.5--Contract Clauses



236.570  Additional provisions and clauses.

    (a) Use the following clauses in all fixed-price construction 
solicitations and contracts--
    (1) 252.236-7000, Modification Proposals-Price Breakdown; and
    (2) 252.236-7001, Contract Drawings, Maps, and Specifications.
    (b) Use the following provisions and clauses in fixed-price 
construction contracts and solicitations as applicable--
    (1) 252.236-7002, Obstruction of Navigable Waterways, when the 
contract will involve work near or on navigable waterways.
    (2) When the head of the contracting activity has approved use of a 
separate bid item for mobilization and preparatory work, use either--
    (i) 252.236-7003, Payment for Mobilization and Preparatory Work. Use 
this clause for major construction contracts that require--
    (A) Major or special items of plant and equipment; or
    (B) Large stockpiles of material which are in excess of the type, 
kind, and quantity which would be normal for a contractor qualified to 
undertake the work; or
    (ii) 252.236-7004, Payment for Mobilization and Demobilization. Use 
this

[[Page 299]]

clause for contracts involving major mobilization expense, or plant 
equipment and material (other than the situations covered in paragraph 
(b)(2)(i) of this section) made necessary by the location or nature of 
the work.
    (A) Generally, allocate 60 percent of the lump sum price in 
paragraph (a) of the clause to the cost of mobilization.
    (B) Vary this percentage to reflect the circumstances of the 
particular contract, but in no event should mobilization exceed 80 
percent of the payment item.
    (3) 252.236-7005, Airfield Safety Precautions, when construction 
will be performed on or near airfields.
    (4) 252.236-7006, Cost Limitation, if the solicitation's bid 
schedule contains one or more items subject to statutory cost 
limitations, and if a waiver has not been granted (FAR 36.205).
    (5) 252.236-7007, Additive or Deductive Items, if the procedures in 
236.303-70 are being used.
    (6) 252.236-7008, Contract Prices--Bidding Schedule, if the contract 
will contain only unit prices for some items.
    (c) Use the provision at 252.236-7010, Overseas Military 
Construction-Preference for United States Firms, in solicitations for 
military construction contracts that are estimated to exceed $1,000,000 
and are to be performed in the United States territories and possessions 
in the Pacific and on Kwajalein Atoll, or in countries bordering the 
Arabian Gulf.
    (d) Also see 246.710(4) for an additional clause applicable to 
construction contracts to be performed in Germany.
[56 FR 36421, July 31, 1991, as amended at 57 FR 42632, Sept. 15, 1992; 
62 FR 2856, Jan. 17, 1997; 62 FR 34127, June 24, 1997]



               Subpart 236.6--Architect-Engineer Services



236.601  Policy.

    (1) 10 U.S.C. 2807(b) requires notice to Congress 21 days before the 
initial obligation of funds if a contract is for--
    (i) A-E services or construction design for military construction, 
military family housing, or restoration or replacement of damaged or 
destroyed facilities; and
    (ii) An estimated total contract price of $300,000 or more.
    (2) During the 21 day period, synopsis of the proposed contract 
action and administrative actions leading to the award may be started.



236.602  Selection of firms for architect-engineer contracts.



236.602-1  Selection criteria.

    (a)(i) Establish the evaluation criteria before making the public 
announcement required by FAR 5.205(c) and include the criteria and their 
relative order of importance in the announcement. The evaluation 
criteria should be project specific. Use the information in the DD Form 
1391, FY---- Military Construction Project Data, when available, and 
other pertinent project data in preparing the evaluation criteria.
    (4) Use performance evaluation data from the central data base 
identified in 236.201.
    (6) The primary factor in A-E selection is the determination of the 
most highly qualified firm. Also consider secondary factors such as 
geographic proximity and equitable distribution of work, but do not 
attribute greater significance to the secondary factors than to 
qualifications and past performance. Do not reject the overall most 
highly qualified firm solely in the interest of equitable distribution 
of contracts.
    (A) Consider the volume of work awarded by DoD during the previous 
12 months. In considering equitable distribution of work among A-E 
firms, include small and small disadvantaged business firms and firms 
that have not had prior DoD contracts--
    (1) Use data extracted from the Defense Contract Action Data System 
(DCADS) compiled from DD Form 350, Individual Contracting Action Report. 
DCADS data may be obtained from the central data base identified in 
236.201(c)(1).
    (2) Do not consider awards to overseas offices for projects outside 
the United States, its territories and possessions. Do not consider 
awards to a subsidiary if the subsidiary is not normally subject to 
management decisions, bookkeeping, and policies of a

[[Page 300]]

holding or parent company or an incorporated subsidiary that operates 
under a firm name different from the parent company. This allows greater 
competition.
    (B) Consider as appropriate superior performance evaluations on 
recently completed DoD contracts.
    (C) Consider the extent to which potential contractors identify and 
commit to small business and to small disadvantaged business, 
historically black college and university, or minority institution 
performance of the contract, whether as a joint venture, teaming 
arrangement, or subcontractor.
[56 FR 36421, July 31, 1991, as amended at 59 FR 27673, May 27, 1994]



236.602-2  Evaluation boards.

    (a) Preselection boards are authorized, if the lists they develop 
are approved by the head of the construction activity. If used, 
preselection boards will--
    (i) Be formally constituted;
    (ii) Consist of at least three members; and
    (iii) Prepare a preselection list of the maximum practicable number 
of qualified firms using data described in FAR 36.603, and any other 
pertinent information.



236.602-4  Selection authority.

    (a)(i) The following selections require special approval--
    (A) The estimated contract price exceeds $500,000;
    (B) The firm to be selected has already been awarded contracts 
totaling over $500,000 during the current calendar year by the 
construction activity; or
    (C) Supplemental work added to an existing contract causes the total 
contract price to exceed $500,000. Special approval is not, however, 
required for supplemental work added to a contract under the clause at 
FAR 52.243-1, Changes-Fixed Price.
    (ii) Special approval means approval by the next higher 
organizational level above the construction activity or as established 
in contracting activity procedures and must be obtained prior to 
negotiation with the A-E firm.
    (c) A finding that some of the firms on the selection report are 
unqualified does not preclude approval of the report, provided that a 
minimum of three firms remains. The reasons for finding a firm or firms 
unqualified must be recorded.



236.602-70  Restriction on award of overseas architect-engineer contracts to foreign firms.

    In accordance with Section 111 of Public Law 104-32 and similar 
sections in subsequent military construction appropriations acts, A-E 
contracts funded by military construction appropriations that are 
estimated to exceed $500,000 and are to be performed in Japan, in any 
North Atlantic Treaty Organization member country, or in countries 
bordering the Arabian Gulf, shall be awarded only to United States firms 
or to joint ventures of United States and host nation firms.
[62 FR 2858, Jan. 17, 1997]



236.604  Performance evaluation.

    (a) Preparation of performance reports. Use DD Form 2631, 
Performance Evaluation (Architect-Engineer), instead of SF 1421.
    (2) Prepare a separate performance evaluation after actual 
construction of the project. Ordinarily, the evaluating official should 
be the person most familiar with the A-E's performance.
    (c) Distribution and use of performance reports.
    (i) Forward each performance report to the central data base 
identified in 236.201(c) after completing the review. The procedures in 
236.201 also apply to A-E contracts.
    (ii) File and use the SF 1421, Performance Evaluation (Architect-
Engineer), in a manner similar to the SF 254, Architect-Engineer and 
Related Services Questionnaire.
[56 FR 36421, July 31, 1991, as amended at 61 FR 7749, Feb. 29, 1996]



236.606  Negotiations.



236.606-70  Statutory fee limitation.

    (a) 10 U.S.C. 4540, 7212, and 9540 limit the contract price (or fee) 
for A-E services for the preparation of designs, plans, drawings, and 
specifications to six percent of the project's estimated construction 
cost.

[[Page 301]]

    (b) The six percent limit also applies to contract modifications, 
including modifications involving--
    (1) Work not initially included in the contract. Apply the six 
percent limit to the revised total estimated construction cost.
    (2) Redesign. Apply the six percent limit as follows--
    (i) Add the estimated construction cost of the redesign features to 
the original estimated construction cost;
    (ii) Add the contract cost for the original design to the contract 
cost for redesign; and
    (iii) Divide the total contract design cost by the total estimated 
construction cost. The resulting percentage may not exceed the six 
percent statutory limitation.
    (c) The six percent limit applies only to that portion of the 
contract (or modification) price attributable to the preparation of 
designs, plans, drawings, and specifications. If a contract or 
modification also includes other services, the part of the price 
attributable to the other services is not subject to the six percent 
limit.



236.609  Contract clauses.



236.609-70  Additional provision and clause.

    (a)(1) Use the clause at 252.236-7009, Option for Supervision and 
Inspection Services, in solicitations and contracts for A-E services 
when--
    (i) The contract will be fixed price; and
    (ii) Supervision and inspection services by the A-E may be required 
during construction.
    (2) Include the scope of such services in appendix A of the 
contract.
    (b) Use the provision 252.236-7011, Overseas Architect-Engineer 
Services--Restriction to United States Firms, in solicitations for A-E 
contracts that are estimated to exceed $500,000 and are to be performed 
in Japan, in any North Atlantic Treaty Organization member country, or 
in countries bordering the Arabian Gulf.
[56 FR 36421, July 31, 1991, as amended at 62 FR 2858, Jan. 17, 1997]



     Subpart 236.7--Standard and Optional Forms for Contracting for 
Construction, Architect-Engineer Services, and Dismantling, Demolition, 
                       or Removal of Improvements



236.701  Standard and optional forms for use in contracting for construction or dismantling, demolition, or removal of improvements.

    (c) Do not use Optional Form 347, Order for Supplies and Services, 
(see 213.505-2).



PART 237--SERVICE CONTRACTING--Table of Contents




Sec.

                Subpart 237.1--Service Contracts--General

237.102  Policy.
237.102-70  Prohibition on contracting for firefighting or security-
          guard functions.
237.104  Personal services contracts.
237.106  Funding and term of service contracts.
237.109  Services of quasi-military armed forces.
237.170  Uncompensated overtime.
237.170-1  Scope.
237.170-2  General policy.
237.170-3  Solicitation provision.

             Subpart 237.2--Advisory and Assistance Services

237.203  Types of advisory and assistance services.
237.203-70  Acquisition of audit services.
237.205  Management controls.
237.206  Requesting activity responsibilities.
237.270  Master agreements.
237.270-1  Establishing agreements.
237.270-2  Ordering procedures.
237.270-3  Limitation.
237.270-4  Reporting requirements.

                    Subpart 237.70--Mortuary Services

237.7000  Scope.
237.7001  Method of acquisition.
237.7002  Area of performance.
237.7003  Distribution of contracts.
237.7004  Solicitation provisions and contract clauses.

            Subpart 237.71--Laundry and Dry Cleaning Services

237.7100  Scope.
237.7101  General.

[[Page 302]]

237.7102  Solicitation provisions and contract clauses.

             Subpart 237.72--Educational Service Agreements

237.7200  Scope.
237.7201  Educational service agreement.
237.7202  Limitations.
237.7203  Duration.
237.7204  Format and clauses for educational service agreements.

    Subpart 237.73--Services of Students at Research and Development 
                              Laboratories

237.7300  Scope.
237.7301  Definitions.
237.7302  General.
237.7303  Contract clauses.

         Subpart 237.74--Services at Installations Being Closed

237.7400  Scope.
237.7401  Policy.
237.7402  Contract clause.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36424, July 31, 1991, unless otherwise noted.



                Subpart 237.1--Service Contracts--General



237.102  Policy.

    To the maximum extent practicable, acquire services on the basis of 
the task to be performed rather than on the basis of the number of hours 
to be provided.
[56 FR 67220, Dec. 30, 1991]



237.102-70  Prohibition on contracting for firefighting or security-guard functions.

    (a) Under 10 U.S.C. 2465, the DoD is prohibited for entering into 
contracts for the performance of firefighting or security-guard 
functions at any military installation or facility unless--
    (1) The contract is to be carried out at a location outside the 
United States (to include any U.S. commonwealth, territory, or 
possession) at which members of the armed forces would have to be used 
for the performance of firefighting or security-guard functions at the 
expense of unit readiness;
    (2) The contract will be carried out on a Government-owned but 
privately operated installation; or
    (3) The contract (or renewal of a contract) is for the performance 
of a function under contract on September 24, 1983.
    (b) Under Section 2907 of Public Law 103-160, this prohibition does 
not apply to services at installations being closed (see subpart 
237.74).
[60 FR 61599, Nov. 30, 1995]



237.104  Personal services contracts.

    (b)(i) Authorization to acquire the personal services of experts and 
consultants is included in Public Law 101-165, section 9002. Personal 
service contracts for expert and consultant services must also be 
authorized by a determination and findings (D&F) in accordance with 
department/agency regulations.
    (A) Generally, the D&F should authorize one contract at a time; 
however, an authorizing official may issue a blanket D&F for classes of 
contracts.
    (B) Prepare each D&F in accordance with FAR 1.7 and include a 
determination that--
    (1) The duties are of a temporary or intermittent nature;
    (2) Acquisition of the services is advantageous to the national 
defense;
    (3) DoD personnel with necessary skills are not available;
    (4) Excepted appointment cannot be obtained;
    (5) A nonpersonal services contract is not practicable;
    (6) Statutory authority, 5 U.S.C. 3109 and other legislation, apply; 
and
    (7) Any other determination required by statues has been made.
    (ii) Personal services contracts for health care are authorized by 
10 U.S.C. 1091.
    (A) This authority may be used to acquire--
    (1) Direct health care services provided in medical treatment 
facilities; and
    (2) Services of clinical counselors, family advocacy program staff, 
and victim's services representatives to members of the Armed Forces and 
covered beneficiaries who require such services, provided in medical 
treatment facilities or elsewhere. Persons

[[Page 303]]

with whom a personal services contract may be entered into under this 
authority include clinical social workers, psychologists, psychiatrists, 
and other comparable professionals who have advanced degrees in 
counseling or related academic disciplines and who meet all requirements 
for State licensure and board certification requirements, if any, within 
their fields of specialization.
    (B) Sources for personal services contracts with individuals under 
the authority of 10 U.S.C. 1091 shall be selected through the procedures 
in this section. These procedures do not apply to contracts awarded to 
business entities other than individuals. Selections made using the 
procedures in this section are exempt by statute from FAR part 6 
competition requirements (see 206.001(b)).
    (C) Approval requirements for--
    (1) Direct health care personal service contracts (see 
237.104(b)(ii)(A)(1)) and a pay cap are in DoDI 6025.5, Personal 
Services Contracting Authority for Direct Health Care Providers. 
Requests to enter into a personal service contract for direct health 
care services must be approved by the commander of the medical/dental 
treatment facility where the services will be performed.
    (2) Services of clinical counselors, family advocacy program staff, 
and victim's services representatives (see 237.104(b)(ii)(A)(2)), shall 
be in accordance with agency procedures.
    (D) The contracting officer must ensure that the requiring activity 
provides a copy of the approval with the purchase request.
    (E) The contracting officer must provide adequate advance notice of 
contracting opportunities to individuals residing in the area of the 
facility. The notice must include the qualification criteria against 
which individuals responding will be evaluated. The contracting officer 
shall solicit applicants through at least one local publication which 
serves the area of the facility. Acquisitions under this section for 
personal service contracts are exempt from the posting and synopsis 
requirements of FAR part 5.
    (F) The contracting officer shall provide the qualifications of 
individuals responding to the notice to the commander of the facility 
for evaluation and ranking in accordance with agency procedures. 
Individuals must be considered solely on the basis of the professional 
qualifications established for the particular personal services being 
acquired and the Government's estimate of reasonable rates, fees, or 
other costs. The commander of the facility shall provide the contracting 
officer with rationale for the ranking of individuals, consistent with 
the required qualifications.
    (G) Upon receipt from the facility of the ranked listing of 
applicants, the contracting officer shall either--
    (1) Enter into negotiations with the highest ranked applicant. If a 
mutually satisfactory contract cannot be negotiated, the contracting 
officer shall terminate negotiations with the highest ranked applicant 
and enter into negotiations with the next highest.
    (2) Enter into negotiations with all qualified applicants and select 
on the basis of qualifications and rates, fees, or other costs.
    (H) In the event only one individual responds to an advertised 
requirement, the contracting officer is authorized to negotiate the 
contract award. In this case, the individual must still meet the minimum 
qualifications of the requirement and the contracting officer must be 
able to make a determination that the price is fair and reasonable.
    (I) If a fair and reasonable price cannot be obtained from a 
qualified individual, the requirement should be canceled and acquired 
using procedures other than those set forth in this section.
    (f)(i) Payment to each expert or consultant for personal services 
under 5 U.S.C. 3109 shall not exceed the highest rate fixed by the 
Classification Act Schedules for grade GS-15, except the following which 
shall not exceed the highest rate payable to a GS-18--
    (A) Professional engineering services primarily involving research 
and development; or
    (B) Professional services involving physical sciences, natural 
sciences, or medicine.
    (ii) The contract may provide for the same per diem and travel 
expenses authorized for a Government employee, including actual 
transportation and

[[Page 304]]

per diem in lieu of subsistence for travel between home or place of 
business and official duty station.
    (iii) Coordinate with the civilian personnel office on benefits, 
taxes, personnel ceilings, and maintenance of records.
[56 FR 36424, July 31, 1991, as amended at 60 FR 2888, Jan. 12, 1995; 60 
FR 61599, Nov. 30, 1995]



237.106  Funding and term of service contracts.

    (1) Personal service contracts for expert or consultant services 
shall not exceed one year.
    The nature of the duties must be--
    (i) Temporary (not more than one year); or
    (ii) Intermittent (not cumulatively more than 130 days in one year).
    (2) The following categories of service contracts, funded by annual 
appropriations, are authorized to extend beyond the end of the fiscal 
year--
    (i) One year contracts for maintenance of tools, equipment, or 
facilities (see 10 U.S.C. 2410a(1));
    (A) Tools generally are items found in supply groups 51 and 52, such 
as hand and power tools, gauges, measuring devices, etc.
    (B) Examples of equipment or facilities maintenance services 
include--
    (1) Custodial or housekeeping services;
    (2) Security or fire protection services;
    (3) Refuse collection;
    (4) Grounds or surfaced area maintenance;
    (5) Heating systems operation and maintenance;
    (6) Military family housing maintenance;
    (7) Energy monitoring control systems maintenance and repair;
    (8) Commissary refrigeration maintenance and repair;
    (9) Medical facility real property maintenance management;
    (10) Hospital aseptic maintenance management;
    (11) Animal or pest control;
    (12) Maintenance of flight simulators;
    (13) Maintenance of computers and associated hardware; and
    (14) Maintenance of weapon systems;

    (ii) One year contracts for depot maintenance (see 10 U.S.C. 
2410a(3));
    (iii) Multi-year service contracts;
    (iv) One year requirements or indefinite quantity contracts, as 
defined in FAR 16.503 and FAR 16.504, in which the minimum quantities 
are certain to be ordered in the fiscal year current at the beginning of 
the contract term (but see FAR 32.705-1(b));
    (v) Personal service contracts for experts or consultants or 
contracts for educational services, which cannot feasibly be subdivided 
for separate performance in each fiscal year; or
    (vi) One year contracts for operation of Government equipment (see 
10 U.S.C. 2410a(4)).
[56 FR 36424, July 31, 1991, as amended at 57 FR 14994, Apr. 23, 1992]



237.109  Services of quasi-military armed forces.

    See 237.102-70b for prohibition on contracting for firefighting or 
security-guard functions.
[60 FR 61599, Nov. 30, 1995]



237.170  Uncompensated overtime.



237.170-1  Scope.

    This section implements section 834 of Pub. L. 101-510 (10 U.S.C. 
2331).
[56 FR 67220, Dec. 30, 1991]



237.170-2  General policy.

    (a) Use of uncompensated overtime is not encouraged.
    (b) When services are acquired on the basis of the number of hours 
to be provided, rather than on the task to be performed, the 
solicitation shall require offerors to identify uncompensated overtime 
hours and the uncompensated overtime rate for direct charge Fair Labor 
Standards Act--exempt personnel included in their proposals and 
subcontractor proposals. This includes uncompensated overtime hours that 
are in indirect cost pools for personnel whose regular hours are 
normally charged direct.
[56 FR 67220, Dec. 30, 1991, as amended at 57 FR 14995, Apr. 23, 1992]

[[Page 305]]



237.170-3  Solicitation provision.

    Use the provision at 252.237-7019, Identification of Uncompensated 
Overtime, in all solicitations estimated at $100,000 or more, for 
services to be acquired on the basis of the number of hours to be 
provided.
[56 FR 67220, Dec. 30, 1991, as amended at 57 FR 14995, Apr. 23, 1992]



             Subpart 237.2--Advisory and Assistance Services



237.203  Types of advisory and assistance services.

    (d) Engineering and technical service.
    (i) Engineering and technical services consist of--
    (A) Contract field services, which are engineering and technical 
services provided on site at Defense locations by the trained and 
qualified engineers and technicians of commercial or industrial 
companies;
    (B) Contract plant services, which are engineering and technical 
services provided by the trained and qualified engineers and technicians 
of a manufacturer of military equipment or components, in the 
manufacturer's own plants and facilities; and
    (C) Field service representatives, which are employees of a 
manufacturer of military equipment or components who provide a liaison 
or advisory service between their company and the military users of 
their company's equipment or components.
    (ii) Every contract for engineering and technical services alone or 
as part of an end item, shall--
    (A) Show those services as a separately priced line item;
    (B) Contain definitive specifications for the services; and
    (C) Show the work-months involved.
    (iii) Agency heads may authorize personal service contracts for 
contract field services to meet an unusual essential mission need. The 
authorization will be for an interim period only.



237.203-70  Acquisition of audit services.

    (a) General policy. (1) Departments and agencies shall not contract 
for audit services unless the cognizant DoD audit organization 
determines that expertise required to perform the audit is not available 
within the DoD audit organization, or temporary audit assistance is 
required to meet audit reporting requirements mandated by law or DoD 
regulation.
    (2) DoDD 7600.2, Audit Policies, provides DoD audit policies.
    (3) DoDI 7600.6, Audit of Nonappropriated Fund Instrumentalities and 
Related Activities, provides guidance to audit organizations for audits 
of nonappropriated fund organizations.
    (4) DoD 7600.7-M, Internal Audit Manual, chapter 20, provides policy 
and guidance to DoD audit organizations for the monitoring of audit 
services provided by non-Federal auditors.
    (b) Contract period. Except in unusual circumstances, contracts for 
recurring audit services shall be awarded for a one year period with at 
least two option years.
    (c) Approvals. Contracting officers shall not issue a solicitation 
for audit services unless the requiring activity provides evidence that 
the cognizant DoD audit organization has approved the statement of work. 
The requiring agency shall obtain the same evidence of approval for 
subsequent material changes to the statement of work.
    (d) Solicitation provisions and contract clauses. (1) Use the 
provision of 252.237-7000, Notice of Special Standards of 
Responsibility, in solicitations for audit services.
    (2) Use the clause at 252.237-7001, Compliance with Audit Standards, 
in solicitations and contracts for audit services.
[56 FR 36424, July 31, 1991, as amended at 57 FR 42632, Sept. 15, 1992]



237.205  Management controls.

    DoD procedures are in DoDD 4205.2, DoD Contracted Advisory and 
Assistance Services.



237.206  Requesting activity responsibilities.

    (b) On acquisitions for studies, the purchase request package must 
contain a signed statement from the technical officer responsible for 
the study stating that the Defense Technical Information Center (DTIC) 
and other information sources have been queried, that evidence of those 
queries are on file,

[[Page 306]]

and no existing scientific or technical report could fulfill the 
requirement.
    (c) The authority, without redelegation authority (see DoDD 4205.2), 
to approve the use of advisory and assistance services in contracts over 
$50,000 is--
    (i) An SES manager;
    (ii) A general or flag officer;
    (iii) An officer in O-6 grade filling a general or flag officer 
level position; or
    (iv) An officer in O-6 grade who has subordinate SES personnel.



237.270  Master agreements.

    Section 2304 of Title 10, U.S.C., authorizes award of master 
agreements under which orders may be issued for specific contract 
advisory and assistance services (CAAS). The authority to award master 
agreements expires September 30, 1994.
[58 FR 28471, May 13, 1993]



237.270-1  Establishing agreements.

    (a) Use this section only for types of advisory and assistance 
services described in FAR 37.203.
    (b) Establish agreements using competitive procedures.
    (c) Use the procedures for basic ordering agreements (see FAR 
16.703) except--
    (1) Synopsize solicitations for agreements as if they were service 
contracts expected to exceed $25,000;
    (2) Establish agreements with at least three of the sources 
submitting offers; and
    (3) Establish agreements for a period not to exceed two years, and 
do not extend them.



237.270-2  Ordering procedures.

    (a) Ordering procedures for master agreements are the same as for 
basic ordering agreements, except that requests for proposals for 
individual orders need not be synopsized, nor is a justification and 
approval required. Orders under master agreements are an additional 
circumstance permitting full and open competition after exclusion of 
sources (FAR subpart 6.2).
    (b) Before placing an order under a master agreement, the 
contracting officer--
    (1) Must reasonably expect that at least two sources with 
established agreements will submit offers or an order cannot be placed 
against an agreement;
    (2) Shall request offers from all agreements holders;
    (3) Shall ensure the statement of work clearly specifies the tasks 
to be performed;
    (4) Shall accept the offer most advantageous to the Government, 
considering all relevant factors specified in the request for offers;
    (5) Shall synopsize issued orders in accordance with FAR 5.302; and
    (6) Shall ensure orders have an identifiable deliverable.



237.270-3  Limitation.

    The total value of orders issued under master agreements in a fiscal 
year by any contracting activity (as defined in 202.101) shall not 
exceed 30 percent of the value of all contracts for advisory and 
assistance services awarded by that activity during fiscal year 1989. 
This limitation may be increased from 30 percent to not more than 50 
percent if--
    (a) The head of the contracting activity (HCA) waives the 30 percent 
limitation. Each waiver shall be in the form of a determination and 
finding prepared and processed in accordance with department/agency 
procedures. The determination and finding must specify that the use of 
master agreements is necessary to further the policy of acquiring 
advisory and assistance services on the basis of the task to be 
performed rather than on the basis of the number of hours provided; and
    (b) The agency publishes a notice of the waiver in the Federal 
Register and 60 days have passed since the notice of the HCA waiver 
appeared in the Federal Register. Federal Register notices shall be 
forwarded for publication in accordance with agency procedures.



237.270-4  Reporting requirements.

    (a) Each department and agency shall provide an annual report to 
OSD, ATTN: OUSD(A)DP(CPA), not later than November 15 of each year. The 
report control symbol is DD-P&L(A) 1849. The report shall include--

[[Page 307]]

    (1) The total number of master agreements awarded (with names of 
contractors and type of CAAS being acquired) and estimated dollar value 
of each agreement;
    (2) The number of task orders awarded under each master agreement 
(by contractor) and dollar value of each (including modifications); and
    (3) The period covered by the report.
    (b) Each department and agency shall centrally maintain the 
following information, for all master agreements expected to involve 
work in excess of $2 million (including modifications), on a fiscal year 
basis--
    (1) The number of bid protests filed, number sustained, and number 
of awards terminated during the competition for master agreements and 
task orders;
    (2) The program's effect on the procurement administrative leadtime 
for CAAS;
    (3) Statements of work describing the services contracted for and 
the source evaluation criteria used to evaluate proposals for award;
    (4) The level of small business participation in the program; and
    (5) The number of contracts where a contractor certified that a 
conflict of interest exists under the regulations implementing section 
8141 of the National Defense Authorization Act for FY89, the nature of 
the conflict of interest, and the steps taken to resolve such conflicts 
of interest among firms that qualify for master agreements.



                    Subpart 237.70--Mortuary Services



237.7000  Scope.

    This subpart contains acquisition procedures for contracts for 
mortuary services (the care of remains) for military personnel within 
the U.S. Departments/agencies may use these procedures as guidance in 
areas outside the U.S. for both deceased military and civilian 
personnel.



237.7001  Method of acquisition.

    (a) Requirements type contract. By agreement among the military 
activities, one activity in each geographical area will contract for the 
estimated requirements for the care of remains for all military 
activities in the area. Use a requirements type contract (see FAR 
16.503) when the estimated annual requirements for the activities in the 
area are ten or more.
    (b) Purchase order. Where no contract exists, use DD Form 1155, 
Order for Supplies and Services/Request for Quotations, to obtain 
mortuary services.



237.7002  Area of performance.

    Determine and define the geographical area to be covered by the 
contract using the following general guidelines--
    (a) Use political boundaries, streets, or other features as 
demarcation lines.
    (b) The size should be roughly equivalent to the contiguous 
metropolitan or municipal area enlarged to include the activities 
served.
    (c) If the area of performance best suited to the needs of a 
particular contract is not large enough to include a carrier terminal 
commonly used by people within such area, the contract area of 
performance shall specifically state that it includes such terminal as a 
pickup or delivery point.



237.7003  Distribution of contracts.

    In addition to normal contract distribution, send three copies of 
each contract to each activity authorized to use the contract, and two 
copies to each of the following--
    (a) HQDA (TAPC-PEC-D), Alexandria, VA 22331.
    (b) Commander, Naval Medical Command, Department of the Navy (MED 
3141), 23rd and E Streets, NW, Washington, DC 20372.
    (c) Headquarters, AFMPC-MPCCM, Randolph AFB, TX 78150.



237.7004  Solicitation provisions and contract clauses.

    (a) Use the provision at 252.237-7002, Award to Single Offeror, in 
all sealed bid solicitations for mortuary services. Use the basic 
provision with its Alternate I in all negotiated solicitations for 
mortuary services.
    (b) Use the following clauses in all mortuary service solicitations 
and contracts, except do not use the clauses at 252.237-7004, Area of 
Performance, and 252.237-7010, Facility Requirements, in

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solicitations or contracts that include port of entry requirements--
    (1) 252.237-7003, Requirements, (insert activities authorized to 
place orders in paragraph (e) of the clause);
    (2) 252.237-7004, Area of Performance;
    (3) 252.237-7005, Performance and Delivery;
    (4) 252.237-7006, Subcontracting;
    (5) 252.237-7007, Termination for Default;
    (6) 252.237-7008, Group Interment;
    (7) 252.237-7009, Permits;
    (8) 252.237-7010, Facility Requirements; and
    (9) 252.237-7011, Preparation History.
    (c) Use the clause at FAR 52.245-4, Government-Furnished Property 
(Short Form), in solicitations and contracts that include port of entry 
requirements.



            Subpart 237.71--Laundry and Dry Cleaning Services



237.7100  Scope.

    This subpart contains acquisition procedures for laundry and dry 
cleaning services within the United States. It may be used as guidance 
in all other locations.



237.7101  General.

    (a) Except for hospital requirements, acquire laundry and dry 
cleaning services on a count-of-articles basis.
    (b) Laundry services in support of hospitals may be acquired on the 
basis of a count-of-articles or by bulk weight.
    (1) Acquisitions by weight may be on either a presorted (bag type) 
or unsorted (simple bulk weight) basis.
    (2) In selecting the basis, consider such factors as price, 
administrative costs, aseptic requirements, risk of contamination or 
cross-contamination, and volume and nature of articles to be serviced.



237.7102  Solicitation provisions and contract clauses.

    (a) Use the provision at 252.237-7012, Instruction to Offerors 
(Count-of-Articles), in solicitations for laundry and dry cleaning 
services to be provided on a count-of-articles basis.
    (b) Use the provision at 252.237-7013, Instruction to Offerors (Bulk 
Weight), in solicitations for laundry services to be provided on a bulk 
weight basis.
    (c) Use the clause at 252.237-7014, Loss or Damage (Count-of-
Articles), in solicitations and contracts for laundry and dry cleaning 
services to be provided on a count-of-articles basis.
    (d) Use the clause at 252.237-7015, Loss or Damage (Weight of 
Articles), in solicitations and contracts for laundry and dry cleaning 
services to be provided on a bulk weight basis.
    (1) Insert a reasonable per pound price in paragraph (b) of the 
clause, based on the average per pound value. When the contract requires 
laundry services on a bag type basis, insert reasonable per pound prices 
by bag type.
    (2) Insert an appropriate percentage in paragraph (e) of the clause, 
not to exceed eight percent.
    (e) Use the clause at 252.237-7016, Delivery Tickets, in all 
solicitations and contracts for laundry and dry cleaning services.
    (1) Use the clause with its Alternate I when services are for bag 
type laundry to be provided on a bulk weight basis.
    (2) Use the clause with its Alternate II when services are unsorted 
laundry to be provided on a bulk weight basis.
    (f) Use the clause at 252.237-7017, Individual Laundry, in 
solicitations and contracts for laundry and dry cleaning services to be 
provided to individual personnel.
    (1) Insert the number of pieces of outer garments in paragraphs (d) 
(1) and (2) of the clause.
    (2) The number of pieces and composition of a bundle in paragraphs 
(d) (1) and (2) of the clause may be modified to meet local conditions.
    (g) Use the clause at 252.237-7018, Special Definitions of 
Government Property, in all solicitations and contracts for laundry and 
dry cleaning services.
[56 FR 36424, July 31, 1991, as amended at 62 FR 34127, June 24, 1997]

[[Page 309]]



             Subpart 237.72--Educational Service Agreements



237.7200  Scope.

    (a) This subpart prescribes acquisition procedures for educational 
services from schools, colleges, universities, or other educational 
institutions. This subpart does not include tuition assistance 
agreements, i.e., payment by the Government of partial tuition under the 
off-duty educational program.
    (b) As used in the subpart--
    (1) ``Facilities'' do not include the institution's dining rooms or 
dormitories; and
    (2) ``Fees'' does not include charges for meals or lodging.



237.7201  Educational service agreement.

    (a) An educational service agreement is not a contract, but is an 
ordering agreement under which the Government may order educational 
services.
    (b) Educational service agreements provide for ordering educational 
services when--
    (1) The Government pays normal tuition and fees for educational 
services provided to a student by the institution under its normal 
schedule of tuition and fees applicable to all students generally; and
    (2) Enrollment is at the institution under the institution's normal 
rules and in courses and curricula which the institution offers to all 
students meeting admission requirements.



237.7202  Limitations.

    (a) Make no agreement under this subpart which will result in 
payment of Government funds for tuition or other expenses for training 
in any legal profession, except in connection with the detailing of 
commissioned officers to law schools under 10 U.S.C. 2004.
    (b) Educational service agreements are not used to provide special 
courses or special fees for Government students.



237.7203  Duration.

    (a) Educational service agreements are for an indefinite duration 
and remain in effect until terminated.
    (b) The issuing activity must establish procedures to review each 
educational service agreement at least once each year. Review dates 
should consider the institution's academic calendar and occur at least 
30 days before the beginning of a term. The purpose of the review is to 
incorporate changes to reflect requirements of any statute, Executive 
Order, FAR, or DFARS.
    (c) If the contracting officer and the institution do not agree on 
required changes, terminate the agreement.



237.7204  Format and clauses for educational service agreements.

    Educational service agreements under this subpart shall be in the 
following format. Add to the schedule any other provisions necessary to 
describe the requirements, if they are consistent with the following 
provisions and the policy of acquiring educational services in the form 
of standard course offerings at the prevailing rates of the institution.

                      Educational Service Agreement

                       Agreement No. ____________

    1. This agreement entered into on the ________ day of __________ 
19____, is between the Government, represented by the Contracting 
Officer, and the Contractor, (name of institution), an educational 
institution located in ________ (city), ________ (state).
    2. This agreement is for educational services to be provided by the 
Contractor to Government personnel at the Contractor's institution. The 
Contractor shall provide instruction with standard offerings of courses 
available to the public.
    3. The Government shall pay for services under the Contractor's 
normal schedule of tuition and fees applicable to the public and in 
effect at the time the services are performed.
    4. The Government will review this agreement annually before the 
anniversary of its effective date for the purpose of incorporating 
changes required by statutes, executive orders, the Federal Acquisition 
Regulation, or the Defense Federal Acquisition Regulation Supplement. 
Changes required to be made by modification to this agreement or by 
issuance of a superseding agreement. If mutual agreement on the changes 
cannot be reached, the Government will terminate this agreement.
    5. The parties may amend this agreement only by mutual consent.

[[Page 310]]

    6. This agreement shall start on the date in paragraph 1 and shall 
continue until terminated.
    7. The estimated annual cost of this agreement is $__________. This 
estimate is for administrative purposes only and does not impose any 
obligation on the Government to request any services or make any 
payment.
    8. Advance payments are authorized by 10 U.S.C. 2396(a)(3).
    9. Submit invoices to: ____________ (name and address of activity).

                           Schedule Provisions

    1. Ordering procedures and services to be provided. (a) The 
Contractor shall promptly deliver to the Contracting Officer one copy of 
each catalog applicable to this agreement, and one copy of any 
subsequent revision.
    (b) The Government will request educational services under this 
agreement by a (insert type of request, such as, delivery order, 
official Government order, or other written communication). The (insert 
type of request, such as, delivery order, official Government order, or 
other written communication) will contain the number of this agreement 
and will designate as students at the Contractor's institution one or 
more Government-selected persons who have already been accepted for 
admission under the Contractor's usual admission standards.
    (c) All students under this agreement shall register in the same 
manner, be subject to the same academic regulations, and have the same 
privileges, including the use of all facilities and equipment as any 
other students enrolled in the institution.
    (d) Upon enrolling each student under this agreement, the Contractor 
shall, where the resident or nonresident status involves a difference in 
tuition or fees--
    (i) Determine the resident or nonresident status of the student;
    (ii) Notify the student and the Contracting Officer of the 
determination. If there is an appeal of the determination;
    (iii) If there is an appeal of the determination, process the appeal 
under the Contractor's standard procedures;
    (iv) Notify the student and Contracting Officer of the result; and
    (v) Make the determination a part of the student's permanent record.
    (e) The Contractor shall not furnish any instruction or other 
services to any student under this agreement before the effective date 
of a request for services in the form specified in paragraph (b) of this 
schedule.
    2. Change in curriculum. The Contracting Officer may vary the 
curriculum for any student enrolled under this agreement but shall not 
require or make any change in any course without the Contractor's 
consent.
    3. Payment. (a) The Government shall pay the Contractor the normal 
tuition and fees which the Contractor charges any students pursuing the 
same or similar curricula, except for any tuition and fees which this 
agreement excludes. The Contractor may change any tuition and fees, 
provided--
    (1) The Contractor publishes the revisions in a catalog or otherwise 
publicly announces the revisions;
    (2) Applies the revisions uniformly to all students studying the 
same or similar curricula;
    (3) Provides the Contracting Officer notice of changes before their 
effective date.
    (b) The Contractor shall not establish any tuition or fees which 
apply solely to students under this agreement.
    (c) If the Contractor regularly charges higher tuition and fees for 
nonresident students, the Contractor may charge the Government the 
normal nonresident tuition and fees for students under this agreement 
who are nonresidents. The Government shall not claim resident tuition 
and fees for any student solely on the basis of the student residing in 
the State as a consequence of enrollment under this agreement.
    (d) The Contractor shall charge the Government only the tuition and 
fees which relate directly to enrollment as a student. Tuition and fees 
may include--
    (i) Penalty fees for late registration or change of course caused by 
the Government;
    (ii) Mandatory health fees and health insurance charges; and
    (iii) Any flat rate charge applicable to all students registered for 
research that appears in the Contractor's publicly announced fee 
schedule.
    (e) The Contractor shall not charge the Government for--
    (i) Permit charges, such as vehicle registration or parking fees, 
unless specifically authorized in the request for service; and
    (ii) Any equipment, refundable deposits, or any items or services 
(such as computer time) related to student research.
    (f) Normally, the Contractor shall not directly charge individual 
students for application fees or any other fee chargeable to this 
agreement. However, if the Contractor's standard procedures require 
payment of any fee before the student is enrolled under this agreement, 
the Contractor may charge the student. When the Contractor receives 
payment from the Government, the Contractor shall fully reimburse the 
student.
    (g) For each term the Contractor enrolls students under this 
agreement, the Contractor shall submit ________ copies of an invoice 
listing charges for each student separately. The Contractor shall submit 
invoices within ________ days after the start of the term and shall 
include--
    (i) Agreement number and inclusive dates of the term;
    (ii) Name of each student;
    (iii) A list showing each course for each student if the school 
charges by credit hour;

[[Page 311]]

    (iv) The resident or nonresident status of each student (if 
applicable to the Contractor's school); and
    (v) A breakdown of charges for each student, including credit hours, 
tuition, application fee, and other fees. Provide a total for each 
student and a grand total for all students listed on the invoice.
    (h) If unforeseen events require additional charges that are 
otherwise payable under the Contractor's normal tuition and fee 
schedule, the Contractor may submit a supplemental invoice or make the 
adjustment on the next regular invoice under this agreement. The 
Contractor shall clearly identify and explain the supplemental invoice 
or the adjustment.
    (i) The Contractor shall apply any credits resulting from withdrawal 
of students, or from any other cause under its standard procedures, to 
subsequent invoices submitted under this agreement. Credits should 
appear on the first invoice submitted after the action resulting in the 
credits. If no subsequent invoice is submitted, the Contractor shall 
deliver to the Contracting Officer a check drawn to the order of the 
office designated for contract administration. The Contractor shall 
identify the reason for the credit and the applicable term dates in all 
cases.
    4. Withdrawal of students. (a) The Government may, at its option and 
at any time, withdraw financial support for any student by issuing 
official orders. The Government will furnish ________ copies of the 
orders to the Contractor within a reasonable time after publication.
    (b) The Contractor may request withdrawal by the Government of any 
student for academic or disciplinary reasons.
    (c) If withdrawal occurs before the end of a term, the Government 
will pay any tuition and fees due for the current term. The Contractor 
shall credit the Government with any charges eligible for refund under 
the Contractor's standard procedures for any students in effect on the 
date of withdrawal.
    (d) Withdrawal of students by the Government will not be the basis 
for any special charge or claim by the Contractor other than charges 
under the Contractor's standard procedures.
    5. Transcripts. Within a reasonable time after withdrawal of a 
student for any reason, or after graduation, the Contractor shall send 
to the Contracting Officer (or to an address supplied by the Contracting 
Officer) one copy of an official transcript showing all work by the 
student at the institution until such withdrawal or graduation.
    6. Student teaching. The Government does not anticipate the 
Contractor awarding fellowships and assistantships to students attending 
school under this agreement. However, for graduate students, should both 
the student and the Contractor decide it to be in the student's best 
interests to assist in the institution's teaching program, the 
Contractor may provide nominal compensation for part-time service. Base 
the compensation on the Contractor's practices and procedures for other 
students of similar accomplishment in that department or field. The 
Contractor shall apply the compensation as a credit against any invoices 
presented for payment for any period in which the student performed the 
part-time teaching service.
    7. Termination of agreement. (a) Either party may terminate this 
agreement by giving 30 days advance written notice of the effective date 
of termination. In the event of termination, the Government shall have 
the right, at its option, to continue to receive educational services 
for those students already enrolled in the contractor's institution 
under this agreement until such time that the students complete their 
courses or curricula or the Government withdraws them from the 
Contractor's institution. The terms and conditions of this agreement in 
effect on the effective date of the termination shall continue to apply 
to such students remaining in the Contractor's institution.
    (b) Withdrawal of students under Schedule provision 4 shall not be 
considered a termination within the meaning of this provision 7.
    (c) Termination by either party shall not be the basis for any 
special charge or claim by the Contractor, other than as provided by the 
Contractor's standard procedures.

                           General Provisions

    Use the following clauses in educational service agreements--
    1. FAR 52.202-1, Definitions, and add the following paragraphs (d) 
through (i).
    (d) Term means the period of time into which the Contractor divides 
the academic year for purposes of instruction. This includes semester, 
trimester, quarter, or any similar word the Contractor may use.
    (e) Course means a series of lectures or instructions, and 
laboratory periods, relating to one specific representation of subject 
matter, such as Elementary College Algebra, German 401, or Surveying. 
Normally, a student completes a course in one term and receives a 
certain number of semester hours credit (or equivalent) upon successful 
completion.
    (f) Curriculum means a series of courses having a unified purpose 
and belonging primarily to one major academic field. It will usually 
include certain required courses and elective courses within established 
criteria. Examples include Business Administration, Civil Engineering, 
Fine and Applied Arts, and Physics. A curriculum normally covers more 
than one term and leads to a degree or diploma upon successful 
completion.
    (g) Catalog means any medium by which the Contractor publicly 
announces terms and

[[Page 312]]

conditions for enrollment in the Contractor's institution, including 
tuition and fees to be charged. This includes ``bulletin,'' 
``announcement,'' or any other similar word the Contractor may use.
    (h) Tuition means the amount of money charged by an educational 
institution for instruction, not including fees.
    (i) Fees means those applicable charges directly related to 
enrollment in the Contractor's institution. Unless specifically allowed 
in the request for services, fees shall not include--
    (1) Any permit charge, such as parking and vehicle registration; or
    (2) Charges for services of a personal nature, such as food, 
housing, and laundry.
    2. FAR 52.203-1, Officials Not To Benefit.
    3. FAR 52.203-3, Gratuities.
    4. FAR 52.203-5, Covenant Against Contingent Fees.
    5. FAR 52.204-1, Approval of Contract, if required by department/
agency procedures.
    6. FAR 52.215-2, Audit and Records--Negotiation.
    7. FAR 52.215-18, Order of Precedence.
    8. Conflicts Between Agreement and Catalog. Insert the following 
clause--

                 Conflicts Between Agreement and Catalog

    If there is any inconsistency between this agreement and any catalog 
or other document incorporated in this agreement by reference or any of 
the Contractor's rules and regulations, the provisions of this agreement 
shall govern.
    9. FAR 52.222-3, Convict Labor.
    10. Under FAR 22.802, FAR 22.807, and FAR 22.810, use the 
appropriate clause from FAR 52.222-26, Equal Opportunity.
    11. FAR 52.233-1, Disputes.
    12. Assignment of Claims. Insert the following clause:

                          Assignment of Claims

            No claim under this agreement shall be assigned.

    13. FAR 52.252-4, Alterations in Contract, if required by 
department/agency procedure.

                             Signature Page

 Agreement No.__________________________________________________________
 Date___________________________________________________________________

                      The United States of America

 BY:____________________________________________________________________
(Contracting Officer)
 Activity_______________________________________________________________
 Location_______________________________________________________________
(Name of Contractor)
 BY:____________________________________________________________________
 (Title)________________________________________________________________
[56 FR 36424, July 31, 1991, as amended at 60 FR 61599, Nov. 30, 1995]



    Subpart 237.73--Services of Students at Research and Development 
                              Laboratories



237.7300  Scope.

    This subpart prescribes procedures for acquisition of temporary or 
intermittent services of students at institutions of higher learning for 
the purpose of providing technical support at Defense research and 
development laboratories (10 U.S.C. 2360).



237.7301  Definitions.

    As used in this subpart--
    (a) Institution of higher learning means any public or private post-
secondary school, junior college, college, university, or other degree 
granting educational institution that--
    (1) Is located in the United States, its possessions, and Puerto 
Rico;
    (2) Has an accredited education program approved by an appropriate 
accrediting body; and
    (3) Offers a program of study at any level beyond high school.
    (b) Nonprofit organization means any organization described by 
section 501(c)(3) of title 26 of the U.S.C. which is exempt from 
taxation under section 501(a) of title 26.
    (c) Student means an individual enrolled (or accepted for 
enrollment) at an institution of higher learning before the term of the 
student technical support contract. The individual shall remain in good 
standing in a curriculum designed to lead to the granting of a 
recognized degree, during the term of the contract.
    (d) Technical support means any scientific or engineering work in 
support of the mission of the DoD laboratory involved. It does not 
include administrative or clerical services.



237.7302  General.

    Generally, agencies will acquire services of students at 
institutions of higher learning by contract between a nonprofit 
organization employing the student and the Government. When it is in the 
best interest of the Government, contracts may be made directly with 
students. These services are not subject to the requirements of FAR part 
19, FAR 13.105, or DFARS part 219.

[[Page 313]]

Award authority for these contracts is 10 U.S.C. 2304(a)(1) and 10 
U.S.C. 2360.
[56 FR 36424, July 31, 1991, as amended at 60 FR 29500, June 5, 1995]



237.7303  Contract clauses.

    Contracts made directly with students are nonpersonal service 
contracts but shall include the clauses at FAR 52.232-3, Payments Under 
Personal Services Contracts, and FAR 52.249-12, Termination (Personal 
Services).



         Subpart 237.74--Services at Installations Being Closed

    Source:  59 FR 36089, July 15, 1994, unless otherwise noted.



237.7400  Scope.

    This subpart prescribes procedures for contracting, through use of 
other than full and open competition, with local governments for police, 
fire protection, airfield operation, or other community services at 
military installations to be closed under the Defense Authorization 
Amendments and Base Closure and Realignment Act (Pub. L. 100-526), as 
amended, and the Defense Base Closure and Realignment Act of 1990 (Pub. 
L. 101-510), as amended.
[59 FR 36089, July 15, 1994, as amended at 60 FR 29500, June 5, 1995]



237.7401  Policy.

    The authority in 206.302-5(b)(ii) to contract with local 
governments--
    (a) May be exercised without regard to the provisions of 10 U.S.C. 
Chapter 146, Contracting for Performance of Civilian Commercial or 
Industrial Type Functions;
    (b) May not be exercised earlier than 180 days before the date the 
installation is scheduled to be closed;
    (c) Requires a determination by the head of the contracting activity 
that the services being acquired under contract with the local 
government are in the best interests of the Department of Defense.
    (d) Includes the requirement of subpart 222.71, Right of First 
Refusal of Employment, unless it conflicts with the local government's 
civil service selection procedures.
[59 FR 36089, July 15, 1994, as amended at 60 FR 29500, June 5, 1995]



237.7402  Contract clause.

    Use the clause at 252.237-7022, Services at Installations Being 
Closed, in solicitations and contracts based upon the authority of this 
subpart.
[59 FR 36089, July 15, 1994, as amended at 60 FR 29500, June 5, 1995]



PART 239--ACQUISITION OF INFORMATION TECHNOLOGY--Table of Contents




     Subpart 239.70--Exchange or Sale of Information Technology (IT)

Sec.
239.7000  Scope of subpart.
239.7001  Policy.
239.7002  Conditions for using exchange/sale.
239.7003  Procedures.

        Subpart 239.71--Security and Privacy for Computer Systems

239.7100  Scope of subpart.
239.7101  General.
239.7102  Security against compromising emanations.
239.7102-1  General.
239.7102-2  Validation of TEMPEST compliance.
239.7102-3  Contract clause.

                        Subpart 239.72--Standards

239.7200  Scope of subpart.
239.7201  [Reserved]
239.7202  Waivers.

 Subpart 239.73--Acquisition of Automatic Data Processing Equipment by 
                             DoD Contractors

239.7300  Scope of subpart.
239.7301  Applicability.
239.7302  Approvals and screening.
239.7303  Contractor documentation.

               Subpart 239.74--Telecommunications Services

239.7400  Scope.
239.7401  Definitions.
239.7402  Policy.
239.7403  Regulatory bodies.
239.7404  Foreign carriers.
239.7405  Authority to contract for telecommunications services.
239.7406  Cost or pricing data and information other than cost or 
          pricing data.

[[Page 314]]

239.7407-1  General.
239.7407-2  Communication service authorizations (CSAs).
239.7408  Special construction.
239.7408-1  General.
239.7408-2  Applicability of construction labor standards for special 
          construction.
239.7409  Special assembly.
239.7410  Cancellation and termination.
239.7411  Contract clauses.

             Subpart 239.75--Appropriations Act Restrictions

239.7500  Scope of subpart.
239.7501  Major automated information systems restriction.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36429, July 31, 1991, unless otherwise noted.



     Subpart 239.70 Exchange or Sale of Information Technology (IT)

    Source:  62 FR 1059, Jan. 8, 1997, unless otherwise noted.



239.7000  Scope of subpart.

    This subpart contains unique DoD procedures for the exchange or sale 
of information technology using the exchange authority of the General 
Services Administration (GSA). This subpart only applies to items with 
an original acquisition cost of $1,000,000 or more.



239.7001  Policy.

    Agencies should consider exchange/sale when replacing Government-
owned information technology. Exchange/sale is a method of--
    (a) Transferring the equipment to be replaced to--
    (1) Another Government agency, with reimbursement (sale); or
    (2) The supplier of the replacement information technology for a 
trade-in allowance (exchange).
    (b) Applying the proceeds of sale or the exchange allowance toward 
the purchase of replacement information technology.



239.7002  Conditions for using exchange/sale.

    (a) The requiring activity must make a written determination that--
    (1) The trade-in allowance of the exchange or the proceeds of the 
sale will be applied to acquire the replacement information technology; 
and
    (2) The exchange/sale transaction will foster the economic and 
efficient accomplishment of a continuing requirement.
    (b) The replacement equipment must be information technology--
    (1) Similar to the resource being sold or exchanged;
    (2) Which will satisfy the continuing requirement currently met by 
the resource being replaced.



239.7003  Procedures.

    (a) Comply with--
    (1) This subpart;
    (2) Subpart 217.70; and
    (3) The Defense Automation Resources Management Manual.
    (b) Solicit offers both on an exchange (trade-in for allowance) or 
no exchange (no trade-in) basis.
    (c) Retain the option to exercise any exchange offer at the time of 
award.
    (d) List and describe the information technology to be exchanged in 
the solicitation. At a minimum include--
    (1) A brief description of each item;
    (2) Name of manufacturer;
    (3) Equipment type;
    (4) Model number; and
    (5) The condition code and explanation of the code.
    (e) Allow sufficient time in the contracting schedule to permit 
screening within the Government of the information technology to be 
exchanged prior to contract award.
    (f) Immediately upon receipt of offers, determine the highest 
exchange offer (if any) and use it to initiate screening under the 
Defense Automation Resources Management Manual.
    (1) Send an SF 120, Report of Excess Personal Property, to the 
Defense Information Systems Agency, Chief Information Officer, Defense 
Automation Resources Management Program Division, Attn: D03D, 701 South 
Courthouse Road, Arlington, VA 22204-2199. Prominently display the 
following note on the original and five copies of the SF 120:

[[Page 315]]

                       Exchange/``Sale'' Property

    A written administrative determination has been (will be) made to 
apply the exchange allowance or proceeds of ``sale'' to the acquisition 
of similar items.

    (2) Include the following additional information with the SF 120:
    (i) The identity of the offeror of the exchange;
    (ii) The type of replacement equipment;
    (iii) The acquisition method for the replacement equipment;
    (iv) The anticipated purchase price for the replacement equipment; 
and
    (v) The name and telephone number of the contracting officer.
    (g) Evaluate offers using the solicitation criteria, including 
consideration of any exchange allowance offers. Award can be made 
whether or not the replaced information technology is exchanged.
    (h) Before a contract is awarded, consider the results of the 
screening. Do not make an exchange if another Government agency wants to 
acquire the replaced equipment.
    (1) If another agency is going to acquire the replaced equipment, do 
not include the exchange allowance in the contract price.
    (2) The actual sale price to the agency acquiring the replaced 
equipment will be the exchange allowance (if any) of the successful 
offeror.
    (i) If no Government agency wants to acquire the replaced equipment, 
the contract price shall include the exchange allowance, if any.
    (j) If no exchange allowance was offered by the successful 
contractor, see the Defense Automation Resources Management Manual for 
disposal instructions.
[62 FR 1059, Jan. 8, 1997, as amended at 62 FR 34127, June 24, 1997; 62 
FR 49305, Sept. 19, 1997]



        Subpart 239.71--Security and Privacy for Computer Systems



239.7100  Scope of subpart.

    This subpart applies to all acquisitions for computer systems. It 
covers both security and Privacy Act considerations.



239.7101  General.

    Security requirements are in addition to provisions concerning 
protection of privacy of individuals (see FAR subpart 24.1).



239.7102  Security against compromising emanations.



239.7102-1  General.

    (a) The National Security or Atomic Energy Acts, as amended, may 
require protection of information that is--
    (1) Processed;
    (2) Transmitted;
    (3) Stored;
    (4) Retrieved; or
    (5) Displayed.
    (b) When acquiring computer equipment to be used to process 
classified information, the contracting officer shall obtain from the 
requiring activity--
    (1) A determination as to whether the equipment must provide 
protection against compromising emanations; and
    (2) Identification of an established National TEMPEST standard 
(e.g., NACSEM 5100, NACSIM 5100A) or a standard used by other authority.
    (c) When contracts will require the use of FIP resources involving 
classified data, programs, etc., the contracting officer shall obtain 
from the requiring activity--
    (1) Advice to whether to require contractors performing these 
services to use equipment meeting the requirements in paragraph (a) of 
this subsection (as prescribed in the clause at 252.239-7000, Protection 
Against Compromising Emanations;
    (2) Information concerning any requirement for marking of TEMPEST--
certified equipment (especially if to be reused); and
    (3) Information on how to validate TEMPEST equipment compliance with 
required standards.



239.7102-2  Validation of TEMPEST compliance.

    Include requirements for validation of TEMPEST compliance in section 
E (Inspection and Acceptance) of the contract.

[[Page 316]]



239.7102-3  Contract clause.

    When contracting for computer equipment or systems that are to be 
used to process classified information, use the clause at 252.239-7000, 
Protection Against Compromising Emanations.
[62 FR 34127, June 24, 1997]



                        Subpart 239.72--Standards



239.7200  Scope of subpart.

    This subpart contains guidance for implementing--
    (a) Federal Information Processing Standards (FIPS); and
    (b) Federal Telecommunications Standards (FED-STD).



239.7201  [Reserved]



239.7202  Waivers.

    (a) The Secretary of Commerce has delegated to the Secretary of 
Defense the authority to waive FIP standards, in accordance with 
procedures established by the Secretary of Commerce. The Secretary of 
Defense redelegated that waiver authority to the Assistant Secretary of 
Defense for Command, Control, Communications, and Intelligence 
(ASD(C3I)). The ASD(C3I) has redelegated to the senior information 
technology official of each military department the authority to approve 
waivers to FIP standards that are applicable to military department 
requirements. Waivers to FIP standards that are applicable to the 
requirements of DoD components outside the military departments must be 
approved by the ASD(C3I).
    (b) Contracting officers shall ensure that all applicable FIP 
standards are incorporated into solicitations, except for those FIP 
standards for which the requiring activity has obtained a waiver from 
the appropriate military department or DoD senior information technology 
official.
    (c) As part of the Commerce Business Daily synopsis of a 
solicitation, contracting officers shall publish a notice of any 
determinations to waive any FIP standards that are applicable to the 
solicitation. If the waiver determination is made after the notice of 
the solicitation is published, the contracting officer shall amend the 
notice to announce the waiver determination.
[56 FR 36429, July 31, 1991, as amended at 62 FR 1060, Jan. 8, 1997]



 Subpart 239.73--Acquisition of Automatic Data Processing Equipment by 
                             DoD Contractors



239.7300  Scope of subpart.

    This subpart prescribes approval requirements for automatic data 
processing equipment (ADPE) purchased by contractors for use in 
performing DoD contracts.
[62 FR 9376, Mar. 3, 1997]



239.7301  Applicability.

    (a) This subpart applies when the contractor purchases ADPE and 
title will pass to the Government.
    (b) This subpart does not apply to ADPE acquired as a component of 
an end item.
[56 FR 36429, July 31, 1991, as amended at 62 FR 9376, Mar. 3, 1997]



239.7302  Approvals and screening.

    (a) The requirements of this section highlight the redistribution 
requirements of the Defense Automation Resources Management Manual, and 
are in addition to those at FAR 45.302.
    (b) If the contractor proposes acquiring ADPE subject to 239.7301, 
and the unit acquisition cost is $50,000 or more--
    (1) The contracting officer shall require the contractor to submit, 
through the administrative contracting officer, the documentation in 
239.7303.
    (2) The administrative contracting officer--
    (i) Submits a request for screening the requirement against the pool 
of Government-owned ADPE to determine if available excess equipment 
could satisfy the contractor's needs. The request should include the 
contractor's supporting documentation. The request is sent to--

Defense Information Systems Agency, Chief Information Officer, Defense 
Automation Resources Management Program Division,

[[Page 317]]

Attn: D03D, 701 South Courthouse Road, Arlington, VA 22204-2199; or
    (ii) Uses the Automation Resources Management System (ARMS) to 
screen on-line. System access may be requested from the Defense 
Information Systems Agency, Chief Information Officer, Defense 
Automation Resources Management Program (DARMP) Division. Customers may 
apply for an ARMS Account Number by calling the DARMP Help Desk at (703) 
696-1904; DSN 426-1904, FAX (703) 696-1908; E-mail [email protected].
    (iii) Documents the result of the System query.
    (iv) Upon receipt of and based on screening results from DARMP, 
advises the contractor that excess ADPE--
    (A) Is available pursuant to the Defense Automation Resources 
Management Manual; or
    (B) Is not available and the contractor may proceed with acquisition 
of the equipment.
    (3) The contracting officer--
    (i) Reviews the contractor's documentation;
    (ii) Decides whether to authorize the acquisition; and
    (iii) Advises--
    (A) The contractor if authorization is not granted; and
    (B) The administrative contracting officer if authorization is 
granted.
[56 FR 36429, July 31, 1991, as amended at 62 FR 1060, Jan. 8, 1997; 62 
FR 9376, Mar. 3, 1997; 62 FR 34127, June 24, 1997]



239.7303  Contractor documentation.

    Contracting officers may tailor the documentation requirements in 
paragraphs (a) through (d) of this section.
    (a) List of existing ADPE and an analysis of its use. (1) List of 
each component identified by manufacturer, type, model number, location, 
date of installation, and how acquired (lease, purchase, Government-
furnished). Identify those acquired specifically to perform a Government 
contract.
    (2) Reliability and usage data on each component for the past 12 
months.
    (3) Identification of users supported by each component, including 
how much time each user requires the component and the related contract 
or task involved.
    (b) List of new ADPE needed and reasons why it is needed. (1) 
Estimates of the new equipment's useful life.
    (2) List of tasks the new equipment is needed for and why, including 
estimated monthly usage for each major task or project.
    (3) Anticipated software and telecommunications requirements.
    (c) Selection of computer equipment. (1) If the acquisition is 
competitive--
    (i) List sources solicited and proposals received;
    (ii) Show how the evaluation was performed; and
    (iii) Provide an explanation if the selected offer is not the lowest 
evaluated offer.
    (2) If the acquisition is not competitive, state why.
    (d) Cost. State the ADPE cost.
[62 FR 9376, Mar. 3, 1997]



               Subpart 239.74--Telecommunications Services



239.7400  Scope.

    This subpart prescribes policy and procedures for acquisition of 
telecommunications services and maintenance of telecommunications 
security. Telecommunications services may also meet the definition of 
information technology.
[62 FR 1060, Jan. 8, 1997]



239.7401  Definitions.

    As used in this subpart--
    (a) Common carrier means any entity engaged in the business of 
providing telecommunications services which are regulated by the Federal 
Communications Commission or other governmental body.
    (b) Foreign carrier means any person, partnership, association, 
joint-stock company, trust, governmental body, or corporation not 
subject to regulation by a U.S. governmental regulatory body and not 
doing business as a citizen of the United States, providing 
telecommunications services outside the territorial limits of the United 
States.
    (c) Governmental regulatory body means the Federal Communications 
Commission, any statewide regulatory

[[Page 318]]

body, or any body with less than statewide jurisdiction when operating 
under the State authority. The following are not ``governmental 
regulatory bodies''--
    (1) Regulatory bodies whose decisions are not subject to judicial 
appeal; and
    (2) Regulatory bodies which regulate a company owned by the same 
entity which creates the regulatory body.
    (d) Noncommon carrier means any entity other than a common carrier 
offering telecommunications facilities, services, or equipment for 
lease.
    (e) Security, sensitive information, and telecommunications systems 
have the meaning given in the clause at 252.239-7016, Telecommunications 
Security Equipment, Devices, Techniques, and Services.
    (f) Telecommunications means the transmission, emission, or 
reception of signals, signs, writing, images, sounds, or intelligence of 
any nature, by wire, cable, satellite, fiber optics, laser, radio, or 
any other electronic, electric, electromagnetic, or acoustically coupled 
means.
    (g) Telecommunications services means the services acquired, whether 
by lease or contract, to meet the Government's telecommunications needs. 
The term includes the telecommunications facilities and equipment 
necessary to provide such services.



239.7402  Policy.

    (a) Acquisition. (1) DoD policy is to acquire telecommunications 
services from common and noncommon telecommunications carriers--
    (i) On a competitive basis, except when acquisition using other than 
full and open competition is justified.
    (ii) Recognizing the regulations, practices, and decisions of the 
Federal Communications Commission (FCC) and other governmental 
regulatory bodies on rates, cost principles, and accounting practices;
    (iii) Making provision in telecommunications services contracts for 
adoption of--
    (A) FCC approved practices; or
    (B) The generally accepted practices of the industry on those issues 
concerning common carrier services where--
    (1) The governmental regulatory body has not expressed itself;
    (2) The governmental regulatory body has declined jurisdiction; or
    (3) There is no governmental regulatory body to decide.
    (2) DoD's unique consumer needs in both volume and technology 
require DoD to participate actively in the rule making process of 
cognizant governmental regulatory bodies. DoD also must work with the 
government regulatory bodies and common carriers to be sure that in 
those areas in which the FCC cannot or will not rule, sound regulatory 
practices are followed. DoD should make every effort to avoid the time 
and expense of litigation by full and fair disclosure of both the 
carrier's and the DoD's position in advance.
    (3) If actions do not produce reasonable or lawful rates, or when 
there is a refusal to provide required services or file appropriate 
tariffs, DoD should litigate. All contracts with the regulatory bodies 
should be through counsel under department/agency and Defense 
Information Systems Agency procedures.
    (b) Security. (1) The contracting officer shall ensure, in 
accordance with agency procedures, that purchase requests identify--
    (i) The nature and extent of information requiring security during 
telecommunications;
    (ii) The requirement for the contractor to secure telecommunications 
systems;
    (iii) The telecommunications security equipment, devices, 
techniques, or services with which the contractor's telecommunications 
security equipment, devices, techniques, or services must be 
interoperable; and
    (iv) The approved telecommunications security equipment, devices, 
techniques, or services, such as found in the National Security Agency's 
Information Systems Security Products and Services Catalogue.
    (2) Contractors and subcontractors shall provide all 
telecommunications security techniques or services required for 
performance of Government contracts.
    (3) Except as provided in paragraph (b)(4) of this subsection, 
contractors

[[Page 319]]

and subcontractors shall normally provide all required 
telecommunications security equipment or devices as plant equipment in 
accordance with FAR part 45. In some cases, such as for communications 
security (COMSEC) equipment designated as controlled cryptographic item 
(CCI), contractors or subcontractors must also meet ownership 
eligibility conditions.
    (4) When the contractor or subcontractor does not meet ownership 
eligibility conditions, the head of the agency may authorize provision 
of the necessary facilities as Government-furnished property or 
acquisition as contractor-acquired property, as long as conditions of 
FAR 45.303 are met.
[56 FR 36429, July 31, 1991, as amended at 56 FR 67220, Dec. 30, 1991; 
62 FR 1060, Jan. 8, 1997]



239.7403  Regulatory bodies.

    The FCC and other governmental regulatory bodies publish rules and 
regulations on the operations of common carriers and prescribe 
accounting principles to use to establish rates.



239.7404  Foreign carriers.

    (a) Frequently, foreign carriers are owned by the government of the 
country in which they operate. The foreign governments often prescribe 
the methods of doing business. In many countries, an international 
agreement with the host country sets guidelines for acquiring 
communication services. In some countries, a corporate subsidiary of a 
carrier not indigenous to the country (often a U.S. parent) is the sole 
source for telecommunications services.
    (b) Contracts for telecommunications services in foreign countries 
should describe rates and practices in as much detail as possible. It is 
DoD policy not to pay discriminatory rates. DoD should pay a reasonable 
rate for telecommunications services or the rate charged the military of 
that country, whichever is less.
    (c) Refer special problems with telecommunications acquisition in 
foreign countries to higher headquarters for resolution with appropriate 
State Department representatives.



239.7405  Authority to contract for telecommunications services.

    (a) The General Services Administration (GSA) has exclusive 
procurement authority for telecommunications services that meet the 
definition of Federal information processing resources in FIRMR 201-4 
and that meet the applicability criteria in FIRMR 201-1. However, GSA 
may authorize agencies to contract for telecommunications services in 
certain instances under a delegation of GSA's exclusive procurement 
authority (see FIRMR 201-20.305).
    (b) Under FIRMR 201-20.306, GSA authorizes the senior information 
resources management (IRM) officials of each military department and the 
senior IRM official of DoD to enter into multiyear contracts for 
telecommunications services under certain conditions. Contracting 
activities may enter into multiyear contracts for telecommunications 
services if--
    (1) The senior IRM official has redelegated to the contracting 
office, GSA's exclusive procurement authority for FIP sources;
    (2) The contract life, including options, does not exceed ten years; 
and
    (3) The contracting activity complies with OMB budget and accounting 
procedures relating to appropriated funds.
    (c) The senior IRM officials are--
    (1) Army. The Assistant Secretary of the Army (Research, 
Development, and Acquisition);
    (2) Navy. The Assistant Secretary of the Navy (Research, 
Development, and Acquisition);
    (3) Air Force. The Assistant Secretary of the Air Force 
(Acquisition); and
    (4) The defense agencies. Assistant Secretary of Defense for 
Command, Control, Communications, and Intelligence.
    (d) The ten year authority in paragraph (b) of this section applies 
to communications service authorizations (239.7407-2) and other types of 
telecommunications contracts. It does not apply to basic agreements.



239.7406  Cost or pricing data and information other than cost or pricing data.

    (a) Common carriers are not required to submit cost or pricing data 
before

[[Page 320]]

award of contracts for tariffed services. Rates or preliminary estimates 
quoted by a common carrier for tariffed telecommunications services are 
considered to be prices set by regulation within the provisions of 10 
U.S.C. 2306a. This is true even if the tariff is set after execution of 
the contract.
    (b) Rates or preliminary estimates quoted by a common carrier for 
nontariffed telecommunications services or by a noncommon carrier for 
any telecommunications service are not considered prices set by law or 
regulation.
    (c) Contracting officers shall obtain sufficient information to 
determine that the prices are reasonable. For example, cost or pricing 
data, if required in accordance with FAR 15.804-2, or information other 
than cost or pricing data, if required in accordance with FAR 15.804-5, 
may be necessary to support the reasonableness of--
    (1) Nontariffed services;
    (2) Special rates and charges not included in a tariff, whether 
filed or to be filed;
    (3) Special assembly rates and charges;
    (4) Special construction and equipment charges;
    (5) Contingent liabilities that are fixed at the outset of the 
service;
    (6) Proposed cancellation and termination charges under the clause 
at 252.239-7007, Cancellation or Termination of Orders--Common Carriers, 
and reuse arrangements under the clause at 252.239-7008, Reuse 
Arrangements;
    (7) Rates contained in voluntary tariffs filed by nondominant common 
carriers; or
    (8) A tariff, whether filed or to be filed, for new services 
installed or developed primarily for Government use.
[62 FR 40473, July 29, 1997]



239.7407-1  General.

    In addition to acquisition methods described in the FAR, the method 
described in this section may be used to acquire telecommunications 
services.



239.7407-2  Communication service authorizations (CSAs).

    Basic agreements (see FAR 16.702) are used widely in conjunction 
with communication service authorizations to facilitate award of 
telecommunications services.
    (a) Use DD Form 428, Communication Service Authorization (CSA), or 
an electronic data processing substitute to award, modify, cancel, or 
terminate telecommunications services. The CSA shall--
    (1) Refer to the basic agreement;
    (2) Specify the types and quantities and equipment to be provided as 
well as the tariff (or other price if a tariff is not available) of 
those services and equipment;
    (3) Specify the premises involved;
    (4) Cite the address for billing;
    (5) Identify the disbursing office; and
    (6) Provide funding information.
    (b) Before awarding a CSA, comply with the requirements in FAR and 
DFARS, e.g., for competition, reviews, approvals, and determinations and 
findings.
    (c) Include an expiration date in each CSA.
    (d) Modify CSAs to reflect any price increases.



239.7408  Special construction.



239.7408-1  General.

    (a) Special construction normally involves a common carrier giving a 
special service or facility related to the performance of the basic 
telecommunications service requirements.
    This may include--
    (1) Moving or relocating equipment;
    (2) Providing temporary facilities;
    (3) Expediting provision of facilities; or
    (4) Providing specially constructed channel facilities to meet 
Government requirements.
    (b) Use this subpart instead of FAR part 36 for acquisition of 
``special construction.''
    (c) Special construction costs may be--
    (1) A contingent liability for using telecommunications services for 
a shorter time than the minimum to reimburse the contractor for 
unamortized nonrecoverable costs. These costs are usually expressed in 
terms of a termination liability, as provided in the contract or by 
tariff;

[[Page 321]]

    (2) A onetime special construction charge;
    (3) Recurring charges for constructed facilities;
    (4) A minimum service charge;
    (5) An expediting charge; or
    (6) A move or relocation charge.
    (d) When a common carrier submits a proposal or quotation which has 
special construction requirements, the contracting officer shall require 
a detailed special construction proposal. Analyze all special 
construction proposals to--
    (1) Determine the adequacy of the proposed construction;
    (2) Disclose excessive or duplicative construction; and
    (3) When different forms of charge are possible, provide for the 
form of charge most advantageous to the Government.
    (e) When possible, analyze and approve special construction charges 
before receiving the service. Impose a ceiling on the special 
construction costs before authorizing the contractor to proceed, if 
prior approval is not possible. Do not make final payment for special 
construction charges unless the charges are approved by the contracting 
officer.



239.7408-2  Applicability of construction labor standards for special construction.

    (a) The construction labor standards in FAR 22.4 ordinarily do not 
apply to special construction. However, if the special construction 
includes construction (as defined in FAR 36.102) of a public building or 
public work, the construction labor standards may apply. Determine 
applicability under FAR 22.402.
    (b) Each CSA or other type contract which is subject to construction 
labor standards under FAR 22.402 shall cite that fact.



239.7409  Special assembly.

    (a) Special assembly is the designing, manufacturing, arranging, 
assembling, or wiring of equipment to provide telecommunications 
services that cannot be provided with general use equipment.
    (b) Special assembly rates and charges shall be based on estimated 
costs. The contracting officer shall negotiate special assembly rates 
and charges before starting service whenever possible. When it is not 
possible to negotiate in advance, use provisional rates and charges 
subject to adjustment, until final rates and charges are negotiated. The 
CSAs authorizing the special assembly shall be modified to reflect 
negotiated final rates and charges.



239.7410  Cancellation and termination.

    (a)(1) Cancellation is stopping a requirement after placing of an 
order but before service starts.
    (2) Termination is stopping a requirement after placing an order and 
after service starts.
    (b) Determine cancellation or termination charges under the 
provisions of the applicable tariff or agreement/contract.



239.7411  Contract clauses.

    (a) In addition to other appropriate FAR and DFARS clauses, use the 
following clauses in solicitations, contracts, and basic agreements for 
telecommunications services. Modify the clauses only if necessary to 
meet the requirements of a governmental regulatory agency--

(1) 252.239-7002, Access;
(2) 252.239-7003, Facilities and Services to be Furnished--Common 
Carriers;
(3) 252.239-7004, Orders for Facilities and Services--Common Carriers;
(4) 252.239-7005, Rates, Charges, and Services--Common Carriers;
(5) 252.239-7006, Tariff Information;
(6) 252.239-7007, Cancellation or Termination of Orders--Common 
Carriers;
(7) 252.239-7008, Reuse Arrangements.

    (b) Use the following clauses in solicitations, contracts, and basic 
agreements for telecommunications services when the acquisition includes 
or may include special construction. Modify the clauses only if 
necessary to meet the requirements of a governmental regulatory agency--

(1) 252.239-7011, Special Construction and Equipment Charges; and
(2) 252.239-7012, Title to Telecommunication Facilities and Equipment.

    (c) Use the following clauses in basic agreements for 
telecommunications services--


[[Page 322]]


(1) 252.239-7013, Obligation of the Government;
(2) 252.239-7014, Term of Agreement, and insert the effective date of 
the agreement in paragraph (a) of the clause; and
(3) 252.239-7015, Continuation of Communication Service Authorizations, 
as appropriate, and insert in paragraph (a) of the clause, the name of 
the contracting office and the basic agreement or contract number which 
is being superseded.

    (d) Use the clause at 252.239-7016, Telecommunications Security 
Equipment, Devices, Techniques, and Services, in solicitations and 
contracts when performance of a contract requires a securing 
telecommunications.
[56 FR 36429, July 31, 1991, as amended at 57 FR 42632, Sept. 15, 1992; 
62 FR 40473, July 29, 1997]



             Subpart 239.75--Appropriations Act Restrictions

    Source:  57 FR 14995, Apr. 23, 1992, unless otherwise noted.



239.7500  Scope of subpart.

    This subpart contains restrictions on the acquisition of information 
technology, imposed by Defense appropriations acts.
[57 FR 14995, Apr. 23, 1992, as amended at 62 FR 34127, June 24, 1997]



239.7501  Major automated information systems restriction.

    Section 8028 of the FY 1992 Defense Appropriations Act (Pub. L. 102-
172) and similar sections of the FY 1993, FY 1994, and FY 1995 Defense 
appropriations acts prohibit use of DoD appropriations for acquisition 
of major automated information systems, unless the systems have 
successfully completed oversight reviews required by DoD regulations.
[62 FR 1060, Jan. 8, 1997]



PART 241--ACQUISITION OF UTILITY SERVICES--Table of Contents




Sec.
241.001  Definitions.
241.002  Applicability.
241.004  Acquiring utility services.
241.004-1  Policy.
241.004-2  Procedures.
241.004-3  GSA assistance and approval.
241.004-5  Separate contracts.
241.005  Pre-award contract review.
241.007  Contract clauses.
241.007-70  Additional clauses.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36435, July 31, 1991, unless otherwise noted.



241.001  Definitions.

    As used in this part--
    Definite term contract means a contract for utility services for a 
definite period of not less than one nor more than ten years.
    Dual service area means a geographical area in which two or more 
utility suppliers are authorized under State law to provide services.
    Indefinite term contract means a month-to-month contract for utility 
services which may be terminated by the Government upon proper notice.
    Independent regulatory body means the Federal Energy Regulatory 
Commission, a state-wide agency, or an agency with less than state-wide 
jurisdiction when operating pursuant to state authority. The body has 
the power to fix, establish, or control the rates and services of 
utility suppliers.
    Nonindependent regulatory body means a body that regulates a utility 
supplier which is owned or operated by the same entity that created the 
regulatory body, e.g., a municipal utility.
    Regulated utility supplier means a utility supplier regulated by an 
independent regulatory body.
    Service power procurement officer means for the--
    Army, the Chief of Engineers;
    Navy, the Commander, Naval Facilities Engineering Command;
    Air Force, the head of a contracting activity; and
    Defense Logistics Agency, the Executive Director of Contracting.



241.002  Applicability.

    (a) This part applies to purchases of utility services from 
nonregulated and regulated utility suppliers. It includes the 
acquisition of liquified petroleum gas as a utility service when 
purchased from regulated utility suppliers.
    (b)(7) This part does not apply to third party financed projects. 
However,

[[Page 323]]

it may be used for any purchased utility services directly resulting 
from such projects, including those authorized by--
    (A) 10 U.S.C. 2394 for energy, fuels, and energy production 
facilities for periods not to exceed 30 years;
    (B) 10 U.S.C. 2394(a) for renewable energy for periods not to exceed 
25 years;
    (C) 10 U.S.C. 2689 for geothermal resources that result in energy 
production facilities;
    (D) 10 U.S.C. 2809 for potable and waste water treatment plants for 
periods not to exceed 32 years; and
    (E) 10 U.S.C. 2812 for lease/purchase of energy production 
facilities for periods not to exceed 32 years.



241.004  Acquiring utility services.



241.004-1  Policy.

    (1) Except as provided in FAR 41.004, DoD, as a matter of comity, 
will comply with the current regulations, practices and decisions of 
independent regulatory bodies which are subject to judicial appeal. This 
policy does not extend to regulatory bodies whose decisions are not 
subject to appeal nor does it extend to nonindependent regulatory 
bodies.
    (2) Purchases of utility services outside the U.S. may use--
    (i) Formats and technical provisions consistent with local practice; 
and
    (ii) Dual language forms and contracts.
    (3) Rates established by an independent regulatory body are 
considered ``prices set by law or regulation'' and do not require 
submission of cost or pricing data (see FAR subpart 15.8).



241.004-2  Procedures.

    (a)(i) Competitive proposals. When a new major utility service load 
develops or a new military installation is established, the contracting 
officer shall--
    (A) Determine whether more than one supplier can provide the 
required utility services.
    (1) Competition may be possible where dual franchises exist or where 
no franchise exists.
    (2) Competition should also be considered when an installation is 
served by one supplier and other potential suppliers exist even though 
one supplier has entered into a General Services Administration area-
wide contract.
    (B) Where competition exists, solicit competitive proposals from all 
potential suppliers.
    (ii) Periodic reviews for competition. Conduct periodic review of 
ongoing contracts to determine the availability of competition. If 
available, evaluate the need to rewrite the contract considering--
    (A) The possible loss of rights vested in the Government under the 
existing contract;
    (B) The age and quality of the contract; and
    (C) The number of contract modifications and the ease of 
administration with the existing contract documents.
    (iii) Connection and service charges. The Government may pay a 
connection charge when required to cover the cost of the necessary 
connecting facilities. A connection charge based on the estimated labor 
cost of installing and removing the facility shall not include salvage 
cost. A lump-sum connection charge shall be no more than the agreed cost 
of the connecting facilities less net salvage. The order of precedence 
for contractual treatment of connection and service charges is--
    (A) No connection charge.
    (B) Termination liability. Use when an obligation is necessary to 
secure the required services. The obligation must be not more than the 
agreed connection charge, less any net salvage material costs. Use of a 
termination liability instead of a connection charge requires the 
approval of the service power procurement officer or designee.
    (C) Connection charge, refundable. Use a refundable connection 
charge when the supplier refuses to provide the facilities based on lack 
of capital or published rules which prohibit providing up-front funding. 
The contract should provide for refund of the connection charge within 
five years unless a longer period or omission of the refund requirement 
is authorized by the service power procurement officer or designee.
    (D) Connection and service charges, nonrefundable. The Government 
may

[[Page 324]]

pay certain nonrefundable, nonrecurring charges including service 
initiation charges, a contribution in aid of construction, membership 
fees, and charges required by the supplier's rules and regulations to be 
paid by the customer. If possible, consider sharing with other than 
Government users the use of (and costs for) facilities when large 
nonrefundable charges are required.
    (iv) Construction and labor requirements. (A) Do not use the 
connection charge provisions for the installation of Government-owned 
distribution lines and facilities. The acquisition of such facilities 
must be authorized by legislation and accomplished in accordance with 
FAR part 36. Also, do not use the connection charge provisions for the 
installation of new facilities related to the supplier's production and 
general ``backbone'' system unless authorized by legislation.
    (B) Construction labor standards ordinarily do not apply to 
construction accomplished under the connection charge provisions of this 
part. However, if installation includes construction of a public 
building or public work as defined in FAR 36.102, construction labor 
standards may apply.



241.004-3  GSA assistance and approval.

    The General Services Administration (GSA) has delegated DoD 
authority to enter into utility service contracts (FAR 41.003(b)); thus, 
contracting officers need not seek assistance or approval from GSA.



241.004-5  Separate contracts.

    (a)(i) Requests for proposals shall state the anticipated service 
period in terms of months or years. Where the period extends beyond the 
current fiscal year, evaluate offers of incentives for a definite term 
contract.
    (ii) The solicitation may permit offerors the choice of proposing on 
the basis of--
    (A) A definite term not to exceed the anticipated service period; or
    (B) An indefinite term contract.
    (iii) Where the expected service period is less than the current 
fiscal year, the solicitation shall be on the basis of an indefinite 
term contract.
    (iv) Contracts for utility services for leased premises shall 
identify the lease document on the face of the contract.
    (d) Use an indefinite term utility service contract when it is 
considered to be in the Government's best interest to--
    (i) Have the right to terminate on a 30-day (or longer) notice. A 
notice of up to one year may be granted by an installation if needed to 
obtain a more favorable rate, more advantageous conditions, or for other 
valid reasons; or
    (ii) Grant the supplier the right to terminate the contract when of 
benefit to the Government in the form of lower rates, larger discounts 
or more favorable terms and conditions.



241.005  Pre-award contract review.

    (d) Departments/agencies shall conduct their own pre-award contract 
reviews. FAR 41.005 (a) through (c) may be used as a guide.



241.007  Contract clauses.



241.007-70  Additional clauses.

    (a) If the Government must execute a superseding contract and 
capital credits, connection charge credits, or termination liability 
exist, use the clause at 252.241-7000, Superseding Contract.
    (b) Use the clause at 252.241-7001, Government Access, when the 
clause at FAR 52.241-4, Contractor's Facilities, is used.

[[Page 325]]



                    SUBCHAPTER G--CONTRACT MANAGEMENT





PART 242--CONTRACT ADMINISTRATION--Table of Contents




Sec.

  Subpart 242.1--Interagency Contract Administration and Audit Services

242.101  Policy.
242.102  Procedures.

          Subpart 242.2--Assignment of Contract Administration

242.200  Scope of subpart.
242.203  Retention of contract administration.
242.204  Supporting contract administration.
242.205  Designation of the paying office.

         Subpart 242.3--Contract Administration Office Functions

242.301  General.
242.302  Contract administration functions.

                Subpart 242.4--Correspondence and Visits

242.402  Visits to contractors' facilities.

                  Subpart 242.5--Postaward Orientation

242.503  Postaward conferences.
242.503-2  Postaward conference procedure.
242.503-3  Postaward conference report.
242.570  Contract clause.

       Subpart 242.6--Corporate Administrative Contracting Officer

242.602  Assignment and location.

                   Subpart 242.7--Indirect Cost Rates

242.704  Billing rates.
242.705  Final indirect cost rates.
242.705-1  Contracting officer determination procedure.
242.705-2  Auditor determination procedure.
242.705-3  Educational institutions.
242.771  Independent research and development/bid and proposal.
242.771-1  Scope of subpart.
242.771-2  Policy.
242.771-3  Responsibilities.

                  Subpart 242.8--Disallowance of Costs

242.801  Notice of intent to disallow costs.
242.803  Disallowing costs after incurrence.

          Subpart 242.11--Production Surveillance and Reporting

242.1104  Surveillance requirements.
242.1105  Assignment of criticality designator.
242.1106  Reporting requirements.
242.1107  Contract clause.
242.1107-70  Solicitation provision and contract clause.

         Subpart 242.12--Novation and Change-of-Name Agreements

242.1202  Responsibility for executing agreements.
242.1203  Processing agreements.
242.1204  Agreement to recognize a successor in interest (novation 
          agreement).

          Subpart 242.14--Traffic and Transportation Management

242.1401  General.
242.1402  Volume movements within the continental United States.
242.1403  Shipping documents covering f.o.b. origin shipments.
242.1404  Shipments by parcel post or other classes of mail.
242.1404-1  Parcel post eligible shipments.
242.1404-2  Contract clauses.
242.1404-2  -70  Additional clause.
242.1405  Discrepancies incident to shipment of supplies.
242.1470  Demurrage and detention charges.

           Subpart 242.15--Contractor Performance Information

242.1503  Procedures.

                        Subpart 242.70 [Reserved]

                    Subpart 242.71--Voluntary Refunds

242.7100  General.
242.7101  Solicited refunds.
242.7102  Disposition of voluntary refunds.

  Subpart 242.72--Contractor Material Management and Accounting System

242.7200  Scope of subpart.
242.7201  Definitions.
242.7202  Policy.
242.7203  MMAS disclosure, demonstration, and maintenance requirements.
242.7204  Responsibilities.
242.7205  Review procedures.
242.7206  Contract clause.

[[Page 326]]

           Subpart 242.73--Contractor Insurance/Pension Review

242.7300  Scope of subpart.
242.7301  General.
242.7302  Requirements.
242.7303  Responsibilities.

    Subpart 242.74--Technical Representation at Contractor Facilities

242.7400  General.
242.7401  Procedures.

   Subpart 242.75--Contractor Accounting Systems and Related Controls

242.7500  Scope of subpart.
242.7501  Definition.
242.7502  Policy.
242.7503  Procedures.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36437, July 31, 1991, unless otherwise noted.



  Subpart 242.1--Interagency Contract Administration and Audit Services



242.101  Policy.

    (a) Foreign governments and international organizations may request 
contract administration services on their direct purchases from U.S. 
producers. Direct purchase is the purchase of defense supplies in the 
United States through commercial channels for use by the foreign 
government or international organization.
    (d)(i) DoD requires reimbursement, at a rate set by the Under 
Secretary of Defense (Comptroller/Chief Financial Officer), from non-DoD 
organizations, except for--
    (A) Quality assurance, contract administration, and audit services 
provided under a no-charge reciprocal agreement;
    (B) Services performed under subcontracts awarded by the Small 
Business Administration under FAR subpart 19.8; and
    (C) Quality assurance and pricing services performed for the Supply 
and Services Canada.
    (ii) Departments and agencies may request an exception from the 
reimbursement policy in paragraph (d)(i) of this section from the Under 
Secretary of Defense (Comptroller/Chief Financial Officer). A request 
must show that an exception is in the best interest of the Government.
    (iii) Departments and agencies must pay for services performed by 
non-DoD activities, foreign governments, or international organizations, 
unless otherwise provided by reciprocal agreements.
[56 FR 36437, July 31, 1991, as amended at 62 FR 34127, June 24, 1997]



242.102  Procedures.

    (b)(i) Supply and Services Canada (SSC) is permitted to submit its 
requests for contract administration services directly to the cognizant 
contract administration office.
    (ii) Other foreign governments (including Canadian government 
organizations other than SSC) and international organizations send their 
requests for contract administration services to the DoD Central Control 
Point (CCP) at the Defense Contract Management Command (DCMC), New York, 
NY. Contract administration offices provide services only upon request 
from the CCP. The CCP shall--
    (A) Determine whether the request is from a friendly foreign 
government or an international agency in which the United States is a 
participant;
    (B) Determine whether the services are consistent with the DoD 
mutual security program policies (the Assistant Secretary of Defense 
(International Security Affairs) is the source of information for 
questions as to the eligibility of foreign governments to receive 
services);
    (C) Ensure that the reimbursement arrangements are consistent with 
242.101(d);
    (D) Coordinate with appropriate contract administration offices to 
determine whether DoD can provide the services;
    (E) Notify the requestor that the request is accepted, or provide 
reasons why it cannot be accepted;
    (F) Distribute the acquisition documents and related materials to 
contract administration offices; and

[[Page 327]]

    (G) Receive statements of costs incurred by contract administration 
offices for reimbursable services and forward them for billing to the 
Security Assistance Accounting Center.
[56 FR 36437, July 31, 1991, as amended at 62 FR 34127, June 24, 1997]



          Subpart 242.2--Assignment of Contract Administration



242.200  Scope of subpart.

    This subpart does not address the contract administration role of a 
contracting officer's representative (see 201.602).



242.203  Retention of contract administration.

    (a)(i) DoD activities shall not retain any contract for 
administration that requires performance of any contract administration 
function at or near contractor facilities, except contracts for--
    (A) The National Security Agency;
    (B) Research and development with universities;
    (C) Flight training;
    (D) Consultant support services;
    (E) Mapping, charting, and geodesy services;
    (F) Base, post, camp, and station purchases;
    (G) Operation or maintenance of, or installation of equipment at 
radar or communication network sites;
    (H) Communications services;
    (I) Installation, operation, and maintenance of space-track sensors 
and relays;
    (J) Dependents Medicare program contracts;
    (K) Stevedoring contracts;
    (L) Construction and maintenance of military and civil public works, 
including harbors, docks, port facilities, military housing, development 
of recreational facilities, water resources, flood control, and public 
utilities;
    (M) Architect-engineer services;
    (N) Airlift and sealift services (Military Airlift Command and 
Military Sealift Command may perform contract administration services at 
contractor locations involved solely in performance of airlift or 
sealift contracts);
    (O) Subsistence supplies;
    (P) Ballistic missile sites (contract administration offices may 
perform supporting administration of these contracts at missile 
activation sites during the installation, test, and checkout of the 
missiles and associated equipment);
    (Q) Operation and maintenance of, or installation of equipment at, 
military test ranges, facilities, and installations; and
    (R) Purchase orders issued via written telecommunications (See FAR 
13.506).
    (ii) Contract administration functions for base, post, camp, and 
station contracts on a military installation are normally the 
responsibility of the installation or tenant commander. However, the 
Defense Contract Management Command (DCMC) shall, upon request of the 
military department, and subject to prior agreement, perform contract 
administration services on a military installation.
    (iii) DCMC shall provide preaward survey assistance for post, camp, 
and station work performed on a military installation. The contracting 
office and the DCMC preaward survey monitor should jointly determine the 
scope of the survey and individual responsibilities.
    (iv) To avoid duplication, contracting offices shall not locate 
their personnel at contractor facilities, except--
    (A) In support of contracts retained for administration in 
accordance with paragraph (a)(i) of this section; or
    (B) As permitted under subpart 242.74.
[56 FR 36437, July 31, 1991, as amended at 61 FR 7749, Feb. 29, 1996]



242.204  Supporting contract administration.

    (a) In special circumstances, a contract administration office may 
request support from a component not listed in the DoD Directory of 
Contract Administration Services Components (DLAH 4105.4). An example is 
where the contractor's work site is on a military base and a base 
organization is asked to provide support. Before formally sending the 
request, coordinate with the office concerned to ensure that resources 
are available for, and capable of, providing the support.

[[Page 328]]

    (b) When requesting support on a subcontract which includes foreign 
military sale (FMS) requirements, the contract administration office 
shall--
    (i) Mark ``FMS Requirement'' on the face of the documents;
    (ii) For each FMS case involved, provide the FMS case identifier, 
associated item quantities, DoD prime contract number, and prime 
contract line/subline item number.



242.205  Designation of the paying office.

    (1) For contracts assigned to the Defense Contract Management 
Command (DCMC), designate as the paying office--
    (i) The cognizant Defense Finance and Accounting Service (DFAS) 
payment office as specified in the DoD Directory of Contract 
Administration Services Components (DLAH section 4105.4), for contracts 
funded with DoD funds;
    (ii) The department or agency payment office if authorized by 
defense financial management regulations or if the contract is funded 
with non-DoD funds; or
    (iii) Multiple paying offices under paragraphs (1)(i) and (ii) of 
this section--if the contract is funded with both DoD and non-DoD funds.
    (2) For contracts not assigned to DCMC, select a paying office or 
offices under department/agency procedures.
[56 FR 36437, July 31, 1991, as amended at 57 FR 53601, Nov. 12, 1992; 
59 FR 27673, May 27, 1994]



         Subpart 242.3--Contract Administration Office Functions



242.301  General.

    Contract administration services performed outside the U.S. should 
be performed in accordance with FAR 42.301 unless there are no policies 
and procedures covering a given situation. In this case, coordinate 
proposed actions with the appropriate U.S. country teams or commanders 
of unified and specified commands.



242.302  Contract administration functions.

    (a)(4) Also, review and evaluate--
    (A) Contractor estimating systems (see FAR 15.811); and
    (B) Contractor material management and accounting systems under 
subpart 242.72.
    (7) See 242.7503 for ACO responsibilities with regard to receipt of 
an audit report identifying significant accounting system or related 
internal control deficiencies.
    (8) Monitor contractor costs under subpart 242.70.
    (9) For additional contract administration functions related to 
IR&D/B&P projects performed by major contractors, see 242.771-3(a).
    (19) Also negotiate and issue contract modifications reducing 
contract prices in connection with the provisions of paragraph (b) of 
the clause at FAR 52.225-10, Duty-Free Entry, and paragraph (c) of the 
clause at 252.225-7009, Duty-Free Entry--Qualifying Country End Products 
and Supplies.
    (33) Also perform industrial readiness and mobilization production 
planning field surveys and negotiate schedules.
    (39) See 223.370 for safety requirements on contracts for ammunition 
and explosives.
    (41) The Defense Contract Management Command (DCMC) has 
responsibility for reviewing earned value management system (EVMS) plans 
and verifying initial and continuing contractor compliance with DoD EVMS 
criteria.
    (67) Also support program offices and buying activities in 
precontractual efforts leading to a solicitation or award.
    (S-70) Serve as the single point of contact for all Single Process 
Initiative (SPI) Management Council activities. The ACO shall negotiate 
and execute facilitywide class modifications and agreements for SPI 
processes, when authorized by the affected components.
    (b)(S-70) Issue, negotiate and execute orders under basic ordering 
agreements for overhaul, maintenance and repair.
[56 FR 36437, July 31, 1991, as amended at 57 FR 53601, Nov. 12, 1992; 
60 FR 29500, June 5, 1995; 61 FR 50454, Sept. 26, 1996; 62 FR 9991, Mar. 
5, 1997; 62 FR 44224, Aug. 20, 1997]

[[Page 329]]



                Subpart 242.4--Correspondence and Visits



242.402  Visits to contractors' facilities.

    (a) If a visit to a contractor facility will require access to 
classified information, the visitors must give the contractor advance 
written notice (DoD 5220.22-R, Industrial Security Regulation).



                  Subpart 242.5--Postaward Orientation



242.503  Postaward conferences.



242.503-2  Postaward conference procedure.

    Use the conference program outlined on the DD Form 1484, Post-Award 
Conference Record, in conducting the conference.



242.503-3  Postaward conference report.

    The DD Form 1484, Post-Award Conference Record, may be used for this 
report.



242.570  Contract clause.

    Use the clause at 252.242-7000, Postaward Conference, in 
solicitations and contracts.



       Subpart 242.6--Corporate Administrative Contracting Officer



242.602  Assignment and location.

    (c)(2) If the agencies cannot agree, refer the matter to the 
Director of Defense Procurement.



                   Subpart 242.7--Indirect Cost Rates



242.704  Billing rates.

    (c) The administrative contracting officer or auditor shall 
periodically review billing rates for continued applicability. Billing 
rates should be established on a year-to-year basis.



242.705  Final indirect cost rates.



242.705-1  Contracting officer determination procedure.

    (a) Applicability and responsibility. (1) The corporate 
administrative contracting officer (CACO) and individual administrative 
contracting officers (ACO) shall jointly decide whether negotiations 
will be conducted on a coordinated or centralized basis. When they are 
conducted on a coordinated basis, individual ACOs are responsible for 
coordinating with the CACO to ensure consistency of cost determinations.
    (b) Procedures. (1) Require DoD contractors to submit a copy of 
their final indirect cost rate proposals to the contract auditor.
[56 FR 36437, July 31, 1991, as amended at 60 FR 61599, Nov. 30, 1995]



242.705-2  Auditor determination procedure.

    (b) Procedures. (2)(ii) The contractor and the auditor shall sign 
the agreement.
    (iv) When agreement cannot be reached with the contractor, the 
auditor will issue a DCAA Form 1, Notice of Contract Costs Suspended 
and/or Disapproved, in addition to the advisory report to the 
administrative contracting officer. The DCAA Form 1 details the items of 
exception and advises the contractor that requests for reconsideration 
should be submitted in writing to the administrative contracting 
officer.
[56 FR 36437, July 31, 1991, as amended at 60 FR 61599, Nov. 30, 1995]



242.705-3  Educational institutions.

    (b) Predetermined final indirect cost rates. (4)(i) Predetermined 
indirect cost rate proposals may cover a period of two to four years 
when the cognizant Contracting Officer determines that the educational 
institution's cost experience and other pertinent facts available are 
sufficient to enable the parties to reach an informed judgment on the 
probable levels of indirect costs and allocation base costs for the 
applicable future accounting periods. Predetermined rates covering two 
to four year periods are expected to be the norm in those situations.
    (6) Predetermined indirect cost rates may be established to cover up 
to four years.
[59 FR 53116, Oct. 21, 1994]

[[Page 330]]



242.771  Independent research and development/bid and proposal.



242.771-1  Scope of subpart.

    This section implements section 802 of the National Defense 
Authorization Act for Fiscal Years 1992 and 1993 (Pub. L. 102-190) and 
is effective for IR&D/B&P costs incurred by a major contractor during 
fiscal years of that contractor that begin on or after October 1, 1992.
[57 FR 53601, Nov. 12, 1992]



242.771-2  Policy.

    Defense contractors are encouraged to engage in IR&D/B&P activities 
of potential interest to DoD, including activities cited in 231.205-
18(c)(2)(i)(2).
[57 FR 53601, Nov. 12, 1992]



242.771-3  Responsibilities.

    (a) The cognizant administrative contracting officer (ACO) or 
corporate ACO shall--
    (1) Determine, with input from the field pricing team, whether IR&D/
B&P projects performed by major contractors (see FAR 31.205-18(a)) are 
of potential interest to DoD.
    (2) Notify the contractor promptly of any IR&D/B&P activities which 
are not of potential interest to DoD.
    (b) The Defense Contract Management Command of the Defense Logistics 
Agency or the Military Department responsible for performing contract 
administration functions is responsible for--
    (1) Implementing the requirements of section 802 of Public Law 102-
190 as set forth in 231.205-18(c)(2) and FAR 31.205-18.
    (2) Submitting an annual report to the Director of Defense 
Procurement (OUSD(A&T)) setting forth required statistical information 
relating to the DoD-wide IR&D/B&P program. The Report Control Symbol is 
DD-ACQ(A)1139.
    (c) The Director, Defense Research and Engineering (OUSD(A&T)DDR&E), 
is responsible for establishing a regular method for communication--
    (1) From DoD to contractors, of timely and comprehensive information 
regarding planned or expected DoD future needs; and
    (2) From contractors to DoD, of brief technical descriptions of 
contractor IR&D projects.
[57 FR 53601, Nov. 12, 1992, as amended at 60 FR 61599, Nov. 30, 1995]



                  Subpart 242.8--Disallowance of Costs



242.801  Notice of intent to disallow costs.

    (e) A corporate administrative contracting officer need not obtain 
the approval of the individual administrative contracting officers to 
disallow items of corporate expense.



242.803  Disallowing costs after incurrence.

    (a) Contracting officer receipt of vouchers. Contracting officer 
receipt of vouchers is applicable only for cost-reimbursement contracts 
with the Canadian Commercial Corporation. See 225.870-5(b) for invoice 
procedures.
    (b) Auditor receipt of voucher.
    (i) The contract auditor is the authorized representative of the 
contracting officer for--
    (A) Receiving vouchers from contractors;
    (B) Approving interim vouchers for provisional payment (this 
includes approving the fee portion of vouchers in accordance with the 
contract schedule and administrative contracting officer instructions) 
and sending them to the disbursing office;
    (C) Authorizing direct submission of interim vouchers for 
provisional payment to the disbursing office for contractors with 
approved billing systems;
    (D) Reviewing completion/final vouchers and sending them to the 
administrative contracting officer; and
    (E) Issuing DCAA Forms 1, Notice of Contract Costs Suspended and/or 
Disapproved, to deduct costs where allowability is questionable.
    (ii) The administrative contracting officer--
    (A) Approves all completion/final vouchers and sends them to the 
disbursing officer; and
    (B) May issue or direct the issuance of DCAA Form 1 on any cost when

[[Page 331]]

there is reason to believe it should be suspended or disallowed.
[61 FR 25409, May 21, 1996, as amended at 61 FR 25409, May 21, 1996; 61 
FR 50454, Sept. 26, 1996]



          Subpart 242.11--Production Surveillance and Reporting



242.1104  Surveillance requirements.

    (a)(i) As a minimum, contracts will receive pre-delivery telephonic 
surveillance.
    (ii) Contracts in the following categories will receive pre-delivery 
on-site production surveillance:
    (A) Contracts assigned criticality designator A (see FAR 42.1105).
    (B) Contracts specifically identified for special surveillance by 
the contracting officer.
    (C) Any contract where telephonic surveillance reveals actual or 
anticipated delinquency unless the contract administration office, in 
coordination with the contracting officer, decides that on-site 
surveillance is not warranted.
[60 FR 29500, June 5, 1995]



242.1105  Assignment of criticality designator.

    (1) Contracting officers shall--
    (i) Assign criticality designator A to items with a priority 01, 02, 
03, or 06 (if emergency supply of clothing) under DoD Directive 4410.6, 
Uniform Materiel Movement and Issue Priority System; and
    (ii) Ordinarily assign criticality designator C to unilateral 
purchase orders.
    (2) Only the contracting officer shall change the assigned 
designator.



242.1106  Reporting requirements.

    (a) See also--
    (i) DoD 5000.2-R, Mandatory Procedures for Major Defense Acquisition 
Programs (MDAPs) and Major Automated Information System (MAIS) 
Acquisition Programs; and
    (ii) For cost/schedule control system requirements on major systems 
acquisitions, 234.005-70.
    (b)(i) Within 4 working days after receipt of the contractor's 
report, the contract administration office (CAO) shall provide the 
report and any required comments to the contracting officer and, unless 
otherwise specified in the contract, the inventory control manager.
    (ii) If the contractor's report indicates that the contract is on 
schedule and the CAO agrees, the CAO does not need to add further 
comments. In all other cases, the CAO shall add comments and recommend a 
course of action.
    (c)(i) CAOs may report using--
    (A) DD Form 375-2, Delay in Delivery (Flash Notice);
    (B) DD Form 375, Production Progress Report;
    (C) MILSCAP Revised Delivery Forecast (RDF) system; or
    (D) Message, letters, or facsimile.
    (ii) The contracting office shall acknowledge receipt of the CAO 
report.
[56 FR 36437, July 31, 1991, as amended at 61 FR 50455, Sept. 26, 1996]



242.1107  Contract clause.

    (b) When using the clause at FAR 52.242-2, include the following 
instructions in the contract schedule--
    (i) Frequency and timing of reporting (normally 5 working days after 
each reporting period);
    (ii) Contract line items, exhibits, or exhibit line items requiring 
reports;
    (iii) Offices (with addressees/codes) where reports should be sent 
(always include the contracting office and contract administration 
office); and
    (iv) The following requirements for report content--
    (A) The problem, actual or potential, and its cause;
    (B) Items and quantities affected;
    (C) When the delinquency started or will start;
    (D) Actions taken to overcome the delinquency;
    (E) Estimated recovery date; and/or
    (F) Proposed schedule revision.



242.1107-70  Solicitation provision and contract clause.

    (a) Use the clause at 252.242-7005, Cost/Schedule Status Report, in 
solicitations and contracts for other than major systems that require 
cost/schedule status reporting (i.e., the Contract Data Requirements 
List includes DI-MGMT-81467).

[[Page 332]]

    (b) Use the provision at 252.242-7006, Cost/Schedule Status Report 
Plans, in solicitations for other than major systems that require cost/
schedule status reporting.
[62 FR 9991, Mar. 5, 1997; 62 FR 11953, Mar. 13, 1997; 62 FR 49305, 
Sept. 19, 1997]



         Subpart 242.12--Novation and Change-of-Name Agreements



242.1202  Responsibility for executing agreements.

    The contracting officer responsible for processing and executing 
novation and change-of-name agreements shall ensure agreements are 
executed promptly.
[60 FR 1749, Jan. 5, 1995]



242.1203  Processing agreements.

    (b)(1) For contracts awarded by the Military Departments, provide 
notices to the following addressees instead of individual contracting or 
contract administration offices--

                                                                        
                                                                        
                                                                        
Army......................................  HQ, U.S. Army Material      
                                             Command, ATTN: AMCCC-P,    
                                             5001 Eisenhower Avenue,    
                                             Alexandria, VA 22333-0001. 
Navy......................................  Office of the Assistant     
                                             Secretary of the Navy (RDA)
                                             Procurement Policy,        
                                             Washington, DC 20350-1000. 
Air Force.................................  HQ, Air Force Materiel      
                                             Command, Attn: AFMC/PKM,   
                                             4375 Chidlaw Road, suite 6,
                                             Wright Patterson AFB, OH   
                                             45443-5006.                
National Aeronautics and Space              National Aeronautics and    
 Administration.                             Space Administration,      
                                             Assistant Administrator for
                                             Procurement, ATTN: HP,     
                                             Washington, DC 20546.      
------------------------------------------------------------------------

    (2)(A) Lists for notices of a successor in interest should include 
the information at FAR 42.1204(c)(2).
    (B) Lists for notices of a name change should include the 
information at FAR 42.1205(a)(3).
    (C) On notices sent to the addressees in paragraph (b)(1) of this 
section, include a consolidated list for all subordinate contracting 
offices of the addressee.
    (d)(i) Before making any substantial alterations or additions to the 
novation agreement format at FAR 42.1204(e), coordinate with those 
addressees in paragraph (b)(1) of this section that have contracts with 
the contractor. Resolve any objections before executing the agreement.
    (ii) If the National Aeronautics and Space Administration (NASA) 
wants a separate agreement with the contractor, continue to process the 
agreement only for DoD.
    (e) Also, make distribution to--
    (i) The addressees in paragraph (b)(1) of this section--two copies; 
and
    (ii) The appropriate Military Traffic Management Command (MTMC) area 
command for agreements affecting contracts and basic agreements for 
storage and related services for personal property of military and 
civilian personnel--two copies--

                                                                        
                                                                        
Commander.................................  Commander.                  
Eastern Area..............................  Western Area.               
Military Traffic Management Command.......  Military Traffic Management 
                                             Command.                   
ATTN: MTE-LO..............................  Oakland Army Base.          
Bayonne, NJ 07002.........................  ATTN: MTW-LO, Oakland, CA   
                                             94626.                     
------------------------------------------------------------------------

    (f)(4) Additional distribution instructions--
    (A) Send two copies to the address in paragraph (b)(1) of this 
section. The list of contracts may be confined to those issued by that 
department.
    (B) Do not send copies to NASA or the MTMC commands in paragraph 
(e)(ii). They will issue their own modifications.
[56 FR 36437, July 31, 1991, as amended at 59 FR 27674, May 27, 1994]



242.1204  Agreement to recognize a successor in interest (novation agreement).

    (e) When a novation agreement is required and the transferee intends 
to incur restructuring costs as defined at 213.205-70, the cognizant 
contracting officer shall include the following provision as paragraph 
(b)(7) of the novation agreement instead of the paragraph (b)(7) 
provided in the sample format at FAR 42.1204(e):

    ``(7)(i) Except as set forth in subparagraph (7)(ii) below, the 
Transferor and the Transferee agree that the Government is not obligated 
to pay or reimburse either of them for, or otherwise give effect to, any 
costs, taxes, or other expenses, or any related increases, directly or 
indirectly arising out of or resulting from the transfer or this 
Agreement, other than those that the Government in the absence of this 
transfer or Agreement would

[[Page 333]]

have been obligated to pay or reimburse under the terms of the 
contracts.
    (ii) The Government recognizes that restructuring by the Transferee 
incidental to the acquisition/merger may be in the best interests of the 
Government. Restructuring costs that are allowable under Part 31 of the 
Federal Acquisition Regulation (FAR) or Part 231 of the Defense Federal 
Acquisition Regulation Supplement (DFARS) may be reimbursed under 
flexibily-priced novated contracts, provided the Transferee demonstrates 
that the restructuring will reduce overall costs to the Department of 
Defense (DoD) (and to the National Aeronautics and Space Administration 
(NASA), where there is a mix of DoD and NASA contracts), and the 
requirements included in DFARS 231.205-70 are met. Restructuring costs 
shall not be allowed on novated contracts unless there is an audit of 
the restructuring proposal; a determination by the contracting officer 
of overall reduced costs to DoD/NASA; and an Advance Agreement setting 
forth a cumulative cost ceiling for restructuring projects and the 
period to which such costs shall be assigned.''
[60 FR 1749, Jan. 5, 1995, as amended at 61 FR 16882, Apr. 18, 1996]



          Subpart 242.14--Traffic and Transportation Management



242.1401  General.

    (b)(12) Chapter 39 of the Defense Traffic Management Regulation 
(DTMR) (AR 55-355, NAVSUPINST 4600.70, AFM 75-2, MCO P4600 14A, DLAR 
4500.3) contains methods for tracing and expediting shipments.



242.1402  Volume movements within the continental United States.

    (a)(2) In reporting planned and actual volume movements--
    (A) The contracting officer--
    (1) Provides production schedules and planned destinations to the 
servicing transportation office as soon as the information is available 
to permit the transportation office to determine if volume movements 
will occur. If a volume movement appears likely, the transportation 
office reports a planned volume movement under chapters 12 and 13 of the 
DTMR.
    (2) Sends a copy of the volume movement report to the contract 
administration office.
    (B) The contract administration office submits a volume movement 
report when--
    (1) Significant changes are made to the movement requirements; or
    (2) The contracting office did not submit a report.
    (C) Include the destination country, foreign forwarder, and, if 
known, port of embarkation on volume movement reports for foreign 
military sale shipments.



242.1403  Shipping documents covering f.o.b. origin shipments.

    (a)(i) Procedures for the contractor to obtain Government bills of 
lading are in the clause at 252.242-7003, Application for U.S. 
Government Shipping Documentation/Instructions.
    (ii) The term commercial bills of lading includes the use of any 
commercial form or procedure. Appendix J of the DTMR lists carriers and 
carrier associations that provide transportation within the continental 
United States under commercial forms and procedures.



242.1404  Shipments by parcel post or other classes of mail.



242.1404-1  Parcel post eligible shipments.

    (b)(1) See DoD 4525.8-M, DoD Official Mail Manual.
[56 FR 67220, Dec. 30, 1991]



242.1404-2  Contract clauses.

    When using FAR 52.213-1, Fast Payment Procedures, do not use FAR 
clauses 52.242-10, F.o.b. Origin--Government Bills of Lading or Prepaid 
Postage, or 52.242-11, F.o.b. Origin--Government Bills of Lading or 
Indicia Mail.



242.1404-2-70  Additional clause.

    Use the clause at 252.242-7003, Application for U.S. Government 
Shipping Documentation/Instructions, when using the clause at FAR 
52.242-10, F.o.b. Origin--Government Bills of Lading or Prepaid Postage, 
or FAR 52.242-11, F.o.b. Origin--Government Bills of Lading or Indicia 
Mail.
[62 FR 34127, June 24, 1997]

[[Page 334]]



242.1405  Discrepancies incident to shipment of supplies.

    (a) See also chapter 41 of the Defense Traffic Management Regulation 
(DTMR) for discrepancy procedures.



242.1470  Demurrage and detention charges.

    (a) Procedures for payment or collection of demurrage or detention 
charges are contained in chapter 38 of the DTMR.
    (b) Carrier demurrage rules usually allow for a ``free time'' for 
loading or unloading cars or for any other purpose, and impose charges 
for cars held beyond this period. If a contractor detains railroad cars 
beyond the ``free time,'' the contractor has to pay the carrier's 
published tariff charges for demurrage.
    (c) Detention results when a shipper or consignee holds motor 
carrier equipment beyond a reasonable period for loading, unloading, 
forwarding directions, or any other reason. Detention rules and charges 
are not uniform; they are published in individual carrier or agency 
tenders.



           Subpart 242.15--Contractor Performance Information



242.1503  Procedures.

    Evaluations should consider any notifications submitted under 
paragraph (g) of the clause at 252.219-7003, Small, Small Disadvantaged 
and Women-Owned Small Business Subcontracting Plan (DoD Contracts).
[61 FR 18688, Apr. 29, 1996]



                        Subpart 242.70 [Reserved]



                    Subpart 242.71--Voluntary Refunds



242.7100  General.

    (a) A voluntary refund is a payment or credit (adjustment under one 
or more contracts or subcontracts) to the Government from a contractor 
or subcontractor which is not required by any contractual or other legal 
obligation.
    (b) A voluntary refund may be solicited (requested by the 
Government) or unsolicited.
    (1) Generally, request voluntary refunds only after determining that 
no contractual remedy is readily available to recover the amount sought.
    (2) Acceptance of unsolicited refunds does not prejudice remedies 
otherwise available to the Government.
    (c) Before soliciting a voluntary refund or accepting an unsolicited 
one, the contracting officer should have legal counsel review the 
contract and related data to--
    (1) Confirm that there are no readily available contractual 
remedies; and
    (2) Advise whether the proposed action would jeopardize or impair 
the Government's rights.



242.7101  Solicited refunds.

    (a) Request voluntary refunds only when--
    (1) The contracting officer concludes that the contractor 
overcharged under a contract, or inadequately compensated the Government 
for the use of Government-owned property, or inadequately compensated 
the Government in the disposition of contractor inventory; and
    (2) Retention of the amount in question by the contractor or 
subcontractor would be contrary to good conscience and equity.
    (b) Do not solicit voluntary refunds without approval of the head of 
the contracting activity, or as provided in department/agency 
regulations.
    (c) Voluntary refunds may be requested during or after contract 
performance.



242.7102  Disposition of voluntary refunds.

    A contract modification, rather than a check, is the preferred means 
of effecting a solicited or unsolicited refund transacted before final 
payment.
    (a) For modifications, adjust the price for the refund and credit 
the refund to the applicable appropriation cited in the contract.
    (b) For checks--
    (1) Advise the contractor to--
    (i) Make the check payable to the agency which awarded the contract;

[[Page 335]]

    (ii) Forward the check to the contracting officer or when the 
contract is assigned to another office for administration, to that 
office; and
    (iii) Include a letter with the check--
    (A) Identifying it as a voluntary refund;
    (B) Giving the contract number involved; and
    (C) Where possible, giving the appropriation and account number to 
be credited.
    (2) Forward the check to the office responsible for control of 
funds.



  Subpart 242.72--Contractor Material Management and Accounting System



242.7200  Scope of subpart.

    This subpart provides policies, procedures, and standards for use in 
the evaluation of a contractor's material management and accounting 
system (MMAS).



242.7201  Definitions.

    Material management and accounting system and valid time-phased 
requirements are defined in the clause at 252.242-7004, Material 
Management and Accounting System.



242.7202  Policy.

    DoD policy is for all contractors to have an MMAS that--
    (a) Reasonably forecasts material requirements;
    (b) Ensures the costs of purchased and fabricated material charged 
or allocated to a contract are based on valid time-phased requirements;
    (c) Maintains a consistent, equitable, and unbiased logic for 
costing of material transactions; and
    (d) Conforms to the standards at 252.242-7004(f) when the contractor 
has cost-reimbursement or fixed-price contracts exceeding the simplified 
acquisition threshold, with progress or other contract financing 
provisions, except when all of the contracts and subcontracts are 
awarded under the set-aside or Section 8(a) procedures of FAR part 19.
[56 FR 36437, July 31, 1991, as amended at 57 FR 42632, Sept. 15, 1992; 
61 FR 50455, Sept. 26, 1996]



242.7203  MMAS disclosure, demonstration, and maintenance requirements.

    (a) A large business contractor is subject to MMAS disclosure, 
demonstration, and maintenance if in its preceding fiscal year the 
contractor received DoD prime contracts or subcontracts (including 
modifications) totaling--
    (1) $70 million or more; or
    (2) $30 million or more (but less than $70 million), and the 
contracting officer determines it to be in the best interests of the 
Government (e.g., contractor disclosure, demonstration, or other 
activities indicate significant MMAS problems exist).
    (b) After the administrative contracting officer determines the 
contractor's MMAS is adequate (see 242.7204(b)), written disclosure will 
not be required for the next MMAS review unless the contractor's 
policies, procedures, or practices have changed in the interim 
period(s). Similarly, once the contractor demonstrates that its MMAS 
contains no significant deficiencies, demonstration requirements for 
subsequent reviews may be satisfied if internal audits are reasonably 
current and contain sufficient transaction tests to demonstrate MMAS 
compliance with each standard.
[61 FR 50455, Sept. 26, 1996]



242.7204  Responsibilities.

    (a) The contracting officer shall--
    (1) Through use of the clause at 252.242-7004, Material Management 
and Accounting System, apply the disclosure, demonstration, and 
maintenance requirements to large business contractors meeting the 
criteria in 242.7203(a);
    (2) Consider whether to apply the disclosure, demonstration, and 
maintenance requirements to other large business contractors under 
242.7203(a)(2) after concurrence from, or at the request of, the 
administrative contracting officer; and
    (3) Not apply the disclosure, demonstration, and maintenance 
requirements to small businesses, educational institutions, or nonprofit 
organizations.

[[Page 336]]

    (b) For contractors subject to the disclosure, demonstration, and 
maintenance requirements, the administrative contracting officer (ACO) 
determines the adequacy of the contractor's MMAS and pursues correction 
of deficiencies.
    (c) The contract auditor shall--
    (1) Assist the ACO in evaluating the contractor's MMAS;
    (2) Assess the significance of contractor deficiencies and provide 
the ACO an estimate of the resulting adverse material impact to the 
Government; and
    (3) Assist the ACO in evaluating the contractor's correction of 
deficiencies.
[56 FR 36437, July 31, 1991, as amended at 61 FR 50455, Sept. 26, 1996]



242.7205  Review procedures.

    (a) System Evaluation. Cognizant contract administration and audit 
activities shall jointly establish and manage programs for evaluating 
the MMAS systems of contractors subject to disclosure, demonstration, 
and maintenance requirements and annually establish a schedule of 
contractors to be reviewed. They shall--
    (1) Conduct reviews as a team effort.
    (i) The administrative contracting officer--
    (A) Appoints a team leader; and
    (B) Ensures that the team includes appropriate functional 
specialists (i.e., industrial specialists, engineer, property 
administrator, auditor, etc.).
    (ii) The team leader--
    (A) Advises the ACO and contractor of findings during the review and 
at the exit conference.
    (B) Makes every effort to resolve differences regarding questions of 
fact during the review.
    (2) Tailor reviews to take full advantage of the day-to-day work 
done by both organizations.
    (3) Prepare a review report.
    (4) Conduct a review every 3 years. The ACO, with advice from the 
auditor, may lengthen or shorten the 3 year period based on a risk 
assessment of the contractor's past experience and current 
vulnerability.
    (b) Disposition of evaluation team findings. The team leader shall 
document the evaluation team findings and recommendations in a report to 
the ACO. If there are significant MMAS deficiencies, the report must 
provide an estimate of the adverse impact on the Government resulting 
from those deficiencies.
    (1) Initial notification to the contractor. The ACO shall 
immediately provide a copy of the report to the contractor upon receipt 
from the team leader.
    (i) The ACO shall notify the contractor in a timely manner if there 
are no deficiencies.
    (ii) If there are deficiencies, the ACO shall request the contractor 
to provide a written response within 30 days from the date of initial 
notification.
    (iii) If the contractor agrees with the report, the contractor has 
60 days to correct any identified deficiencies or submit a corrective 
action plan showing milestones and actions to eliminate the 
deficiencies.
    (iv) If the contractor disagrees, request rationale in the written 
response.
    (2) Evaluation of the contractor's response. The administrative 
contracting officer, in consultation with the auditor, evaluates the 
contractor's response and determines whether--
    (i) The MMAS contains deficiencies which need correction;
    (ii) The deficiencies are significant enough to result in the 
reduction or suspension of progress payments or of payments under public 
vouchers; and
    (iii) Proposed corrective actions (if the contractor submitted them) 
are adequate to correct the deficiencies.
    (3) Reduction or Suspension of payments. (i) When the administrative 
contracting officer (ACO) determines that there is a significant MMAS 
deficiency, the ACO shall reduce progress payment claims by an 
appropriate percentage based on affected costs (in accordance with FAR 
32.503-6) and/or suspend questionable costs on public vouchers in 
accordance with FAR 42.803). The reductions or suspensions shall remain 
in effect until the ACO determines that--
    (A) The deficiencies are corrected; or
    (B) The amount of the impact is immaterial.
    (ii) The maximum payment adjustment is the adverse material impact 
to the Government as specified in the team's report. The ACO should use 
the maximum adjustment when the contractor did not submit a corrective 
action plan with its response, or the plan

[[Page 337]]

is unacceptable. In other cases, the ACO should consider the quality of 
the contractor's self-assessment, demonstration, and corrective action 
plan in determining the appropriate percentage.
    (iii) As the contractor implements its accepted corrective action 
plan, the ACO should reinstate a portion of withheld amounts 
commensurate with the contractor's progress in making corrections. 
However, the ACO shall not fully reinstate withheld amounts until the 
contractor corrects the deficiency, or until the impact of the 
deficiency becomes immaterial.
    (4) Notification of administrative contracting officer 
determination. (i) The administrative contracting officer (ACO) shall 
notify the contractor in writing (copy to auditor and functional 
specialists) of--
    (A) Deficiencies needing correction;
    (B) Acceptability of the contractor's corrective action plan (if one 
was submitted) or the need for a corrective action plan; and
    (C) Any decision to reduce or suspend progress payments or public 
vouchers because of significant deficiencies.
    (ii) The Government does not approve or disapprove the contractor's 
MMAS system. ACO notifications should avoid any such implications.
    (iii) From the time the ACO determines that there is a significant 
material management and accounting system deficiency until the time the 
deficiency is corrected, all field pricing reports for that contractor 
shall contain a recommendation relating to proposed cost or pricing data 
adjustments necessary to protect the Government's interests.
    (iv) The ACO should consider the effect of significant MMAS 
deficiencies in reviews of the contractor's estimating system (215.811).
    (5) Monitoring contractor's corrective action. The administrative 
contracting officer (ACO) and auditor shall monitor the contractor's 
progress in correcting deficiencies. If the contractor fails to make 
adequate progress, the ACO shall take further action. Actions for 
consideration may include--
    (i) Elevate the issue to higher level management;
    (ii) Further reduce or suspend progress payments;
    (iii) Notify the contractor of the inadequacy of the contractor's 
cost estimating system and/or cost accounting system.
    (iv) Take appropriate contractual action, i.e., disallow charges as 
unreasonable; and
    (v) Issue cautions to contracting activities regarding the award of 
future contracts.



242.7206  Contract clause.

    Use the clause at 252.242-7004, Material Management and Accounting 
System, in all solicitations and contracts exceeding the simplified 
acquisition threshold that are not for the acquisition of commercial 
items and--
    (a) Are not awarded under the set-aside or section 8(a) procedures 
of FAR part 19; and
    (b) Are either--
    (1) Cost-reimbursement contracts; or
    (2) Fixed-price contracts with progress payments or other Government 
financing.
[56 FR 36437, July 31, 1991, as amended at 60 FR 61599, Nov. 30, 1995; 
61 FR 50455, Sept. 26, 1996]



           Subpart 242.73--Contractor Insurance/Pension Review



242.7300  Scope of subpart.

    This subpart provides the requirements for conducting a Contractor 
Insurance/Pension Review (CIPR).



242.7301  General.

    (a) The administrative contracting officer (ACO) is responsible for 
determining the reasonableness of insurance/pension costs in Government 
contracts. Insurance/pension specialists assist ACOs in making these 
determinations by conducting CIPRs. A CIPR is an in-depth evaluation of 
a contractor's--
    (1) Insurance program;
    (2) Pension plan;
    (3) Other deferred compensation plans; and
    (4) Related policies, procedures, practices, and costs.
    (b) As the DoD Executive Agency, the Defense Logistics Agency 
performs

[[Page 338]]

CIPRs at all contractor locations meeting criteria in 242.7302.
    (c) Insurance/pension specialists are located at the Defense 
Contract Management Districts in Los Angeles and Chicago and at the 
Defense Contract Management Area Operations in New York.
    (d) The CIPR should be the only formal review of a contractor's 
insurance/pension program except for periodic tests of the system 
performed by contract administration and DCAA, or any special reviews 
initiated by the administrative contracting officer. If any organization 
believes that additional reviews of the contractor's insurance/pension 
program should be performed, that request should be conveyed to the ACO. 
The ACO should perform the review as part of an ACO-initiated special 
review, of if possible, as part of the CIPR if one is scheduled to be 
conducted in the near future.



242.7302  Requirements.

    (a) A CIPR shall be conducted for each contractor whose qualifying 
sales to the Government exceeded $40 million during the contractor's 
preceding fiscal year. Qualifying sales are sales for which certified 
cost or pricing data were required under 10 U.S.C. 2306, as implemented 
in FAR 15.804 (unless exempt in accordance with FAR 15.804-3), or which 
are cost-reimbursement type contracts. Sales include prime contracts, 
subcontracts, and modifications to such contracts and subcontracts.
    (b) A CIPR shall be conducted at least every two years for 
contractors who continue to meet the requirements. A more or less 
frequent cycle may be appropriate under certain circumstances, e.g., 
prior to a major contract award, in conjunction with in-depth overhead 
review, or subsequent to mergers or divestitures.
    (c) Special reviews may be performed in the intervening period--
    (1) To follow-up contractor implementation of recommendations and 
verify Government recovery of credits; or
    (2) When information reveals a deficiency or major change in the 
contractor's insurance/pension program.
    (d) Reviews of selected insurance and pension elements may be 
conducted for contractors not meeting the criteria in paragraph (a) of 
this section if significant problems have been identified.
[56 FR 36437, July 31, 1991, as amended at 60 FR 29500, June 5, 1995]



242.7303  Responsibilities.

    (a) The administrative contracting officer is responsible for--
    (1) Determining the need for a CIPR or special review under 
242.7302;
    (2) Requesting and scheduling the reviews with the appropriate 
Defense Logistics Agency activity;
    (3) Notifying the contractor of the proposed date and purpose of the 
review, and obtaining any preliminary data needed by the insurance/
pension specialist;
    (4) Reviewing the CIPR report, advising the contractor of the 
results, and telling the contractor to submit any significant changes in 
insurance/pension plans for review and acceptance prior to making the 
change;
    (5) Providing other interested contracting officers copies of 
documents related to the CIPR; and
    (6) Ensuring adequate follow-up on all CIPR recommendations.
    (b) The insurance/pension specialist is responsible for--
    (1) Preparing and maintaining the schedule of CIPRs to be performed 
during the next 12 months and providing the Military Departments and 
Defense Contract Audit Agency a copy of the schedule;
    (2) Heading the team that conducts the review;
    (3) Maintaining complete documentation for CIPR reports;
    (4) To the extent possible, resolving discrepancies between audit 
reports and CIPR draft reports prior to releasing the final CIPR report;
    (5) Preparing and distributing the final CIPR report;
    (6) Providing the final audit report as an attachment to the CIPR 
report;
    (7) Preparing a draft letter for the administrative contracting 
officer's use in notifying the contractor of CIPR results; and
    (8) When requested, advising administrative contracting officers and 
other Government representatives concerning contractor insurance/pension 
matters.

[[Page 339]]

    (c) The Defense Contract Audit Agency auditor is responsible for--
    (1) Participating as a member of the CIPR team;
    (2) Submitting information and advice to the team based on analysis 
of the contractor's books, accounting records, and other related data; 
and
    (3) Issuing an audit report to the insurance/pension specialist for 
incorporation into the final CIPR report.



    Subpart 242.74--Technical Representation at Contractor Facilities



242.7400  General.

    (a) Contract administration offices (CAOs) are the designated 
representatives of DoD for the administration of contracts (see FAR 
42.202 and 42.302). DoD activities shall use CAOs to perform contract 
administration service functions at or near contractor facilities (see 
242.203(a) (i) and (v).
    (b) Program managers may conclude that they need technical 
representation in contractor facilities to perform non-contract 
administration service (CAS) technical duties and to provide liaison, 
guidance, and assistance on systems and programs. In these cases, the 
program manager may assign technical representatives under the 
procedures in 242.7401.
    (c) Program managers should carefully assess the number of technical 
representatives required to perform the non-CAS technical functions so 
as to keep the total assigned in-plant to the minimum necessary.
    (d) A technical representative is a representative of a DoD program, 
project, or system office performing non-CAS technical duties at or near 
a contractor facility. A technical representative is not--
    (1) A representative of a contract administration or contract audit 
component; or
    (2) A contracting officer's representative (COR) (see 201.602).



242.7401  Procedures.

    (a) When the program, project, or system manager determines that a 
technical representative is required, the manager shall issue a letter 
of intent to the contract administration office commander listing the 
assignment location, starting and ending assignment dates, technical 
duties assigned, delegated authority, and support required from the 
contract administration office. Any issues regarding the assignment of a 
technical representative should be resolved promptly. However, final 
decision on the assignment remains with the program manager. Issues 
regarding the assignment of technical duties which cannot be resolved 
between the program office and the defense plant representative office 
will be escalated.
    (b) The program, project, or system manager shall furnish the 
designated technical representative a letter of assignment of delegated 
technical duties, with copies to the contract administration office, the 
contracting officer, and contractor, at least 30 days before the 
assignment date (or termination date). Any changes to the requirements 
of the assignment letter will be made by a new letter of intent and 
processed in accordance with paragraph (a) of this section.
    (c) The contract administration office normally provides the 
technical representative with office space, equipment, supplies, and 
part-time clerical support. The program, project, or system manager 
provides supervision, technical direction, administrative services 
(e.g., pay, travel, maintenance of personnel records), and, when 
required, full-time clerical support.
    (d) The program manager or designee and the contract administration 
office, at the local level, shall negotiate a memorandum of agreement 
(MOA) delineating their functional administrative interrelationships, 
with annual updates as necessary. The agreements may be included in an 
existing MOA, if one exists, or as a separate MOA.
    (e) The technical representative shall keep the contract 
administration office commander fully informed of matters discussed with 
the contractor. The contract administration office shall also keep the 
technical representative fully informed of contractor discussions which 
relate to technical matters within the purview of the technical 
representative's assigned duties.

[[Page 340]]



   Subpart 242.75--Contractor Accounting Systems and Related Controls

    Source:  60 FR 29500, June 5, 1995, unless otherwise noted.



242.7500  Scope of subpart.

    This subpart provides policies and procedures applicable to 
contractor accounting systems and related internal controls.



242.7501  Definition.

    Internal controls means those policies and procedures established by 
contractor management to provide reasonable assurance that applicable 
laws and regulations are complied with and that actual and estimated 
costs are equitably allocated within the accounting system.



242.7502  Policy.

    Contractors receiving cost-reimbursement or incentive type 
contracts, or contracts which provide for progress payments based on 
costs or on a percentage or stage of completion, shall maintain an 
accounting system and related internal controls throughout contract 
performance which provide reasonable assurance that--
    (a) Applicable laws and regulations are complied with;
    (b) The accounting system and cost data are reliable;
    (c) Risk of misallocations and mischarges are minimized; and
    (d) Contract allocations and charges are consistent with invoice 
procedures.



242.7503  Procedures.

    (a) Upon receipt of an audit report identifying significant 
accounting system or related internal control deficiencies, the ACO 
will--
    (1) Provide a copy of the report to the contractor and allow 30 
days, or a reasonable extension, for the contractor to respond;
    (2) If the contractor agrees with the report, the contractor has 60 
days from the date of initial notification to correct any identified 
deficiencies or submit a corrective action plan showing milestones and 
actions to eliminate the deficiencies.
    (3) If the contractor disagrees, the contractor should provide 
rationale in its written response.
    (4) The ACO will consider whether it is appropriate to suspend a 
percentage of progress payments or reimbursement of costs proportionate 
to the estimated cost risk to the Government, considering audit reports 
or other relevant input, until the contractor submits a corrective 
action plan acceptable to the ACO and corrects the deficiencies. (See 
FAR 32.503-6 (a) and (b) and FAR 42.302(a)(7)).



PART 243--CONTRACT MODIFICATIONS--Table of Contents




Sec.

                         Subpart 243.1--General

243.102  Policy.
243.105  Availability of funds.
243.107  Contract clause.
243.107-70  Notification of substantial impact on employment.
243.170  Identification of foreign military sale (FMS) requirements.
243.171  Obligation or deobligation of funds.

                      Subpart 243.2--Change Orders

243.204  Administration.
243.204-70  Certification of requests for equitable adjustment.
243.205  Contract clauses.
243.205-70  Engineering change proposals.
243.205-71  Pricing of contract modifications.
243.205-72  Certification of requests for equitable adjustment.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36446, July 31, 1991, unless otherwise noted.



                         Subpart 243.1--General



243.102  Policy.

    (b)(i) See subpart 217.74 for limitations on issuing undefinitized 
contract actions.
    (ii) Modifications of letter contracts are subject to the same 
policies and procedures as modifications of definitive contracts.



243.105  Availability of funds.

    (a)(i) 10 U.S.C. 2405 prohibits adjustments in price under a 
shipbuilding contract entered into after December 7,

[[Page 341]]

1983, for a claim, request for equitable adjustment, or demand for 
payment under the contract, arising out of events occurring more than 18 
months before submission of the claim, request, or demand.
    (ii) Section 558 of the National Defense Authorization Act for 
Fiscal Year 1995 (Public Law 103-337) provides that no funds available 
to DoD may be provided by contract or contract modification, nor may 
contract payments be made, to an institution of higher education that 
has a policy of denying or that effectively prevents the Secretary of 
Defense from obtaining for military recruiting purposes--
    (A) Entry to campuses or access to students on campuses; or
    (B) Access to directory information pertaining to students. (See 
209.470.)
    (iii) Pursuant to 10 U.S.C. 983, no funds may be obligated by 
contract or contract modification to an institution of higher education 
that has an anti-ROTC policy. (See 209.470.)
[61 FR 25408, May 21, 1996]



243.107  Contract clause.

    For DoD, the specifically authorized representative (SAR) referred 
to in the clause at FAR 52.243-7, Notification of Changes, is a 
contracting officer's representative as defined in 202.101 and as 
discussed in subpart 201.6.



243.107-70  Notification of substantial impact on employment.

    The Secretary of Defense is required to notify the Secretary of 
Labor if a modification of a major defense contract or subcontract will 
have a substantial impact on employment. The clause prescribed at 
249.7002(c) requires that the contractor notify the contracting officer 
when a contract modification will have a substantial impact on 
employment.
[56 FR 67220, Dec. 30, 1991]



243.170  Identification of foreign military sale (FMS) requirements.

    Identify contract modifications that add FMS requirements by clearly 
marking ``FMS Requirement'' on the front. Within the modification, cite 
each FMS case identifier code by line/subline item number, e.g., FMS 
Case Identifier GY-D-DCA.
[56 FR 36446, July 31, 1991. Redesignated at 56 FR 67220, Dec. 30, 1991]



243.171  Obligation or deobligation of funds.

    For each contract modification, the contracting officer shall 
identify, in Section G, Contract Administration Data (Uniform Contract 
Format), or the contract schedule (Simplified Contract Format), under 
the heading ``Summary for the Payment Office,'' information sufficient 
to permit the paying office to readily identify the changes for each 
contract line and subline item as follows--
    (a) The amount of funds obligated by prior contract actions, to 
include the total cost and fee if a cost-type contract; the target fee 
at time of contract award if a cost-plus-incentive-fee contract; the 
base fee if a cost-plus-award-fee contract; or the target price and 
target profit if a fixed-price incentive contract;
    (b) The amount of funds obligated or deobligated by the instant 
modification, categorized by the types of contracts specified in 
paragraph (a) of this section; and
    (c) The total cumulative amount of obligated or deobligated funds, 
categorized by the types of contracts specified in paragraph (a) of this 
section.
[60 FR 34470, July 3, 1995]



                      Subpart 243.2--Change Orders



243.204  Administration.

    (b) Definitization. The administrative contracting officer (ACO) 
must review change orders issued by the contracting officer to ensure 
compatibility with the status of performance. If the contractor has 
progressed beyond the effective point specified in the change order, the 
ACO must determine the earliest practical point at which the change 
order could be made effective and advise the contracting officer. The 
contracting officer must issue another change order to correct, revise, 
or supersede the first change order, then definitize by supplemental 
agreement citing both change orders.

[[Page 342]]



243.204-70  Certification of requests for equitable adjustment.

    (a) A request for equitable adjustment to contract terms that 
exceeds the simplified acquisition threshold may not be paid unless the 
contract certifies the request in accordance with the clause at 252.243-
7002.
    (b) The aggregate amount of both the increased and decreased costs 
shall be used in determining when the dollar threshold requiring 
certification is met (see example in FAR 15.804-2(a)(1)(iii)).
[62 FR 37147, July 11, 1997]



243.205  Contract clauses.



243.205-70  Engineering change proposals.

    Engineering changes can originate with either the contractor or the 
Government. In either case, the Government will need detailed 
information from the contractor for evaluation of the technical, cost, 
and schedule effects of implementing the change. When the contracting 
officer wants this information submitted in the format prescribed by 
MIL-STD-973, use the clause at 252.243-7000, Engineering Change 
Proposals. Use the clause with its Alternate I, when appropriate, to 
discourage submission of a large number of small dollar, contractor 
originated engineering change proposals.
[59 FR 27674, May 27, 1994]



243.205-71  Pricing of contract modifications.

    Use the clause at 252.243-7001, Pricing of Contract Modifications, 
in solicitations and contracts when anticipating and using a fixed price 
type contract.



243.205-72  Certification of requests for equitable adjustment.

    Use the clause at 252.243-7002, Certification of Requests for 
Equitable Adjustment, in solicitations and contracts estimated to exceed 
the simplified acquisition threshold.
[62 FR 37147, July 11, 1997]



PART 244--SUBCONTRACTING POLICIES AND PROCEDURES--Table of Contents




Sec.

                 Subpart 244.2--Consent to Subcontracts

244.202  Contracting officer's evaluation.
244.202-2  Considerations.

         Subpart 244.3--Contractors' Purchasing Systems Reviews

244.301  Objective.
244.304  Surveillance.
244.305  Granting, withholding, or withdrawing approval.
244.305-70  Granting, withholding, or withdrawing approval.

    Subpart 244.4--Subcontracts for Commercial Items and Commercial 
                               Components

244.403  Contract clause.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36447, July 31, 1991, unless otherwise noted.



                 Subpart 244.2--Consent to Subcontracts



244.202  Contracting officer's evaluation.



244.202-2  Considerations.

    (a) Where other than lowest price is the basis for subcontractor 
selection, has the contractor adequately substantiated the selection as 
offering the greatest value to the Government?
[60 FR 29501, June 5, 1995]



         Subpart 244.3--Contractors' Purchasing Systems Reviews



244.301  Objective.

    The administrative contracting officer (ACO) is responsible for 
reviewing the contractor's purchasing systems. Members of other 
organizations such as audit or program management activities should not 
conduct separate reviews of a contractor's purchasing system, but may 
participate in a review

[[Page 343]]

conducted for the ACO. These organizations may, if they suspect a 
problem, recommend that the ACO initiate a special review.



244.304  Surveillance.

    (b) The ACO, or the purchasing system analyst (PSA) with the 
concurrence of the ACO, may initiate a special review of specific 
weaknesses in the contractor's purchasing system. The weaknesses, for 
example--
    (i) May arise because of--
    (A) Major changes in the contractor's purchasing policies, 
procedures, or key personnel; or
    (B) Changes in plant workload or type of work.
    (ii) May be discovered--
    (A) During reviews of subcontracts submitted under advance 
notification and consent (FAR subpart 44.2); or
    (B) From information provided by Government personnel.
[56 FR 36447, July 31, 1991, as amended at 61 FR 50455, Sept. 26, 1996]



244.305  Granting, withholding, or withdrawing approval.



244.305-70  Granting, withholding, or withdrawing approval.

    Use this subsection instead of FAR 44.305-2(c) and 44.305-3(b).
    (a) At the completion of the in-plant portion of the review, the ACO 
shall hold an exit conference with the contractor. At the conference, 
the ACO should--
    (1) Present the review team's recommendations, signed by the ACO;
    (2) Request the contractor submit its plan for correcting 
deficiencies or making improvements within 15 days; and
    (3) Not comment on the pending or planned decision to grant or 
withhold approval of the contractor's purchasing system.
    (b) The PSA should submit the complete report to the ACO, or any 
department or agency established review board, within ten days after 
receipt of the contractor's response under paragraph (a)(2) of this 
subsection.
    (c) The ACO should completely review the report and consider the 
contractor's response before making a decision on granting, withholding, 
or withdrawing purchasing system approval. The ACO shall notify the 
contractor of the decision within ten days after receipt of the report 
with a copy of the decision to the PSA and the contracting office, when 
requested.
    (d) When a contractor advises that it has corrected deficiencies 
that led the ACO to withhold or withdraw the purchasing system approval, 
the ACO--
    (1) Shall request the PSA to verify that the contractor has--
    (i) Corrected the deficiencies; and
    (ii) Implemented any other ACO recommendations.
    (2) Should ask for a review of purchasing policies and procedures 
issued since the last review.



    Subpart 244.4--Subcontracts for Commercial Items and Commercial 
                               Components



244.403  Contract clause.

    Use the clause at 252.244-7000, Subcontracts for Commercial Items 
and Commercial Components (DoD Contracts), in solicitations and 
contracts for supplies or services other than commercial items, that 
contain the clause at 252.225-7014, Preference for Domestic Specialty 
Metals, Alternate I.
[62 FR 5780, Feb. 7, 1997; 62 FR 49305, Sept. 19, 1997]



PART 245--GOVERNMENT PROPERTY--Table of Contents




Sec.

                         Subpart 245.1--General

245.104  Review and correction of contractor's property control systems.

       Subpart 245.3--Providing Government Property to Contractors

245.301  Definitions.
245.302  Providing facilities.
245.302-1  Policy.
245.302-2  Facilities contracts.
245.302-7  Optional property-related clauses for facilities contracts.
245.303  Providing material.
245.303-2  Procedures.
245.307  Providing special test equipment.
245.307-2  Acquiring special test equipment.
245.310  Providing agency-peculiar property.
245.310-70  Contract clause.

[[Page 344]]

          Subpart 245.4--Use and Rental of Government Property

245.401  Policy.
245.403  Rental--Use and charges clause.
245.405  Contracts with foreign governments or international 
          organizations.
245.407  Non-Government use of plant equipment.

 Subpart 245.5--Management of Government Property in the Possession of 
                               Contractors

245.505  Records and reports of Government property.
245.505-3  Records of material.
245.505-5  Records of plant equipment.
245.505-6  Special reports of plant equipment.
245.505-14  Reports of Government property.

  Subpart 245.6--Reporting, Redistribution, and Disposal of Contractor 
                                Inventory

245.601  Definitions.
245.603  Disposal methods.
245.603-70  Contractor performance of plant clearance duties.
245.603  -71  Disposal of contractor inventory for NATO cooperative 
          projects.
245.604  Restrictions on purchase or retention of contractor inventory.
245.606  Inventory schedules.
245.606-3  Acceptance.
245.606-5  Instructions for preparing and submitting schedules of 
          contractor inventory.
245.606-70  Instructions for completing DD Form 1342, DoD Property 
          Record.
245.607  Scrap.
245.607-1  General.
245.607-2  Recovering precious metals.
245.607-70  Scrap warranty.
245.608  Screening of contractor inventory.
245.608-1  General.
245.608-2  Standard screening.
245.608-5  Special items screening.
245.608-7  Reimbursement of cost for transfer of contractor inventory.
245.608-70  Contractor inventory redistribution system (CIRS).
245.608-71  Screening industrial plant equipment.
245.608-72  Screening excess automatic data processing equipment (ADPE).
245.609  Donations.
245.610  Sale of surplus contractor inventory.
245.610-1  Responsibility.
245.610-3  Proceeds of sale.
245.610-4  Contractor inventory in foreign countries.
245.612  Removal and storage.
245.612-3  Special storage at the Government's expense.
245.613  Property disposal determinations.

    Subpart 245.70--Appointment of Property Administrators and Plant 
                           Clearance Officers

245.7001  Selection, appointment, and termination.
245.7002  Duties and responsibilities of plant clearance officers.

                  Subpart 245.71--Plant Clearance Forms

245.7101  Forms.
245.7101-1  Standard Form 97, Certificate of Release of a Motor Vehicle 
          (Agency Record Copy).
245.7101-2  DD Form 1149, Requisition and Invoice Shipping Document.
245.7101-3  DD Form 1348-1, DoD Single Line Item Release/Receipt 
          Document.
245.7101-4  DD Form 1640, Request for Plant Clearance.

                  Subpart 245.72--Special Instructions

245.7201  Performing inventory verifications and determination of 
          allocability.
245.7202  Establishing a plant clearance case.
245.7203  Assigning plant clearance case numbers.
245.7204  Preparing inventory disposal report.
245.7205  Reporting excess and surplus contractor inventory.
245.7206  Transmitting DD Form 1342, DoD Property Record.

          Subpart 245.73--Sale of Surplus Contractor Inventory

245.7301  Policy.
245.7302  Competitive sales.
245.7302-1  Property descriptions.
245.7302-2  Lotting.
245.7302-3  Alternate bids.
245.7302-4  Basis for sale.
245.7302-5  Mailing lists.
245.7303  Formal bid procedures.
245.7304  Informal bid procedures.
245.7305  Sale approval and award.
245.7306  Sales services.
245.7307  Non-competitive sales.
245.7307-1  General.
245.7307-2  Justification.
245.7308  Antitrust notification.
245.7309  Mandatory terms and conditions--formal invitations.
245.7309-1  Inspection.
245.7309-2  Condition and location of property.
245.7309-3  Consideration of bids.
245.7309-4  Payment.
245.7309-5  Title.
245.7309-6  Delivery and removal of property.
245.7309-7  Default.
245.7309-8  Variations in quantity or weight.
245.7309-9  Weighing.
245.7309-10  Risk of loss.

[[Page 345]]

245.7309-11  Liability.
245.7309-12  Oral statements.
245.7309-13  Eligibility of bidders.
245.7309-14  Claims liability.
245.7310  Special term and conditions.
245.7310-1  Demilitarization.
245.7310-2  Performance bond.
245.7310-3  Liability and insurance.
245.7310-4  Dangerous property.
245.7310-5  Controlled substances.
245.7310-6  Radioactive material.
245.7310-7  Scrap warranty.
245.7310-8  Antitrust clearance.
245.7311  Optional conditions.
245.7311-1  Sales and use tax liability.
245.7311-2  Safety, security, and fire regulations.
245.7311-3  Bid deposits.
245.7311-4  Other special conditions.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36448, July 31, 1991, unless otherwise noted.



                         Subpart 245.1--General



245.104  Review and correction of contractor's property control systems.

    (a) The property administrator shall perform property administration 
in accordance with DoD 4161.2-M, Manual for the Performance of Contract 
Property Administration.
[56 FR 36448, July 31, 1991, as amended at 56 FR 67220, Dec. 30, 1991]



       Subpart 245.3--Providing Government Property to Contractors



245.301  Definitions.

    Agency-peculiar property, as used in DoD, means military property 
and includes end items and integral components of military weapons 
systems, along with the related peculiar support equipment which is not 
readily available as a commercial item.
    Facilities project means a Government project to provide, modernize 
or replace facilities for use by a contractor in performing a Government 
contract or subcontract.
    Industrial plant equipment (IPE) means plant equipment in Federal 
stock group 34 with an acquisition cost of $15,000 or more used for 
cutting, abrading, grinding, shaping, forming, joining, heating, 
treating, or otherwise altering the physical properties of materials, 
components or end items entailed in manufacturing, maintenance, supply, 
processing, assembly, or research and development operations. IPE is 
further identified in AR 700-43/NAVSUP PUB 5009/AFM 78-9/DLAM 4215.1, 
Management of Defense-Owned Industrial Plant Equipment.
    Mapping, charting, and geodesy (MC&G) property is defined in the 
clause at 252.245-7000, Government Furnished Mapping, Charting and 
Geodesy Property.
    Other plant equipment (OPE) means plant equipment regardless of 
dollar value, used in or in conjunction with the manufacture of 
components or end items relative to maintenance, supply, processing, 
assembly or research and development operations. OPE excludes equipment 
categorized as IPE.
    Provide means either to furnish, as in Government-furnished 
property, or to acquire, as in contractor-acquired property.



245.302  Providing facilities.



245.302-1  Policy.

    (a)(4)(A) Comply with DoD Directive 4275.5, Acquisition and 
Management of Industrial Resources, in processing a request for 
facilities. Submit requests for approval of facilities projects--
    (1) To the Secretaries of the Military Departments and the directors 
of defense agencies for Government-owned facilities projects if the 
project--
    (i) Is a research and development-funded effort not exceeding $3 
million per fiscal year; or
    (ii) Is funded from procurement appropriations, approved on a 
location basis, and does not exceed $5 million for all property efforts 
during one fiscal year; or
    (iii) Is in support of a major system or subsystem (including 
ammunition-related projects) and the total investment will not exceed 
$25 million during the projected acquisition or maintenance effort.
    (2) To the Office of the Deputy Under Secretary of Defense 
(Industrial Affairs and Installations) for projects exceeding the 
limitations in paragraph (a)(4)(A)(1) of this subsection.

[[Page 346]]

    (B) The contracting officer shall coordinate the Determination and 
Finding with the program or project manager.
    (C) Departments and agencies must submit reports of facilities 
projects to the House and Senate Armed Services Committees--
    (1) At least 30 days before starting facilities projects involving 
real property (10 U.S.C. 2662); and
    (2) In advance of starting construction for a facilities project 
regardless of cost. Use DD Form 1391, Fiscal Year 19____, Military 
Construction Project Data, to notify congressional committees of 
projects which are not included in the annual budget.
    (b)(1)(A) Industrial plant equipment. Before acquiring industrial 
plant equipment--
    (1) Submit a DD Form 1419, DoD Industrial Plant Equipment 
Requisition, to the Defense Supply Center Richmond (DSCR), Attn: JH, 
8000 Jefferson Davis Highway, Richmond, Va 23297-5100, in accordance 
with AR 700-43/NAVSUP PUB 5009/AFM 78-9/DLAM 4215.1, Management of 
Defense-Owned Industrial Plant Equipment, to determine whether existing, 
reallocable Government-owned facilities can be used.
    (2) Do not acquire any item listed on the DD Form 1419 until a 
certificate of nonavailability is received from DSCR.
    (B) Automatic data processing equipment. The administrative 
contracting officer submits contractor requests to acquire automatic 
data processing equipment to the Defense Information Systems Agency, 
Chief Information Officer, Defense Automation Resources Management 
Program Division, Attn: D03D, 701 South Courthouse Road, Arlington, VA 
22204-2199, in accordance with the Defense Automation Resources 
Management Manual.
[56 FR 36448, July 31, 1991, as amended at 62 FR 34127, June 24, 1997]



245.302-2  Facilities contracts.

    Terminate facilities contracts when Government production and 
research property is no longer required for the performance of 
Government contracts or subcontracts, unless termination is not in the 
best interest of the Government. The contractor is not allowed to extend 
the time for use of property provided under the facilities contract 
without Government authorization.



245.302-7  Optional property-related clauses for facilities contracts.

    Use the clause at 252.225-7030, Restriction on Acquisition of 
Carbon, Alloy, and Armor Steel Plate, as prescribed in 225.7017-4.
[57 FR 14995, Apr. 23, 1992]



245.303  Providing material.



245.303-2  Procedures.

    When a contractor will be responsible for preparing requisitioning 
documentation, include in the contract the requirement to prepare the 
documentation in accordance with DoD 4000.25-1-M, Military Standard 
Requisitioning and Issue Procedures (MILSTRIP). Copies are available 
from the address cited at 251.102(e)2.b(2).



245.307  Providing special test equipment.



245.307-2  Acquiring special test equipment.

    (b) Notice and approval. (1) The review requires a written 
evaluation from the appropriate technical specialist.



245.310  Providing agency-peculiar property.

    (c) All Government-furnished mapping, charting and geodesy (MC&G) 
property is under the control of the Director, Defense Mapping Agency 
(DMA). (See DoDD 5105.40, Defense Mapping Agency (DMA)).
    (i) MC&G property shall not be duplicated, copied, or otherwise 
reproduced for purposes other than those necessary for contract 
performance.
    (ii) Upon completion of contract performance, the contracting 
officer shall--
    (A) Contact the Director, DMA(PP), 8613 Lee Highway, Fairfax, VA 
22031-2137 for disposition instructions;
    (B) Direct the contractor to destroy or return all Government-
furnished MC&G property not consumed during contract performance; and

[[Page 347]]

    (C) Specify the destination and means of shipment for material to be 
returned to the Government.
[56 FR 36448, July 31, 1991, as amended at 59 FR 27674, May 27, 1994]



245.310-70  Contract clause.

    Use the clause at 252.245-7000, Government-Furnished Mapping, 
Charting, and Geodesy Property, in solicitations and contracts when 
mapping, charting, and geodesy property is to be furnished.
[57 FR 42632, Sept. 15, 1992]



          Subpart 245.4--Use and Rental of Government Property



245.401  Policy.

    Government use includes use on contracts for foreign military sales. 
Use on contracts for foreign military sales shall be on a rent-free 
basis.



245.403  Rental--Use and charges clause.

    (1) The DoD normally recovers a fair share of nonrecurring costs of 
special tooling and special test equipment by including these costs in 
its calculation of the nonrecurring cost recoupment charge when major 
defense equipment is sold by foreign military sales or direct commercial 
sales to foreign governments or international organizations. Major 
defense equipment is defined in DODD 2140.2, Recoupment of Nonrecurring 
Costs on Sales of U.S. Products and Technology, as any item of 
significant combat equipment on the United States Munitions List having 
a nonrecurring RDT&E cost of more than $50 million or a total production 
cost of more than $200 million.
    (2) When these cost thresholds are not met, the contracting officer 
shall assess rental charges for use of special tooling and special test 
equipment pursuant to the Use and Charges clause when administratively 
practicable.



245.405  Contracts with foreign governments or international organizations.

    (1) Approval. A contractor may use Government production and 
research property on work for foreign governments and international 
organizations only when approved in writing by the contracting officer 
having cognizance of the property. The contracting officer shall grant 
approval only if--
    (i) The use will not interfere with foreseeable requirements of the 
United States;
    (ii) The work is undertaken as a DoD foreign military sale; or
    (iii) For a direct commercial sale, the foreign country or 
international organization would be authorized to contract with the 
department concerned under the Arms Export Control Act.
    (2) Use charges. (i) The Use and Charges clause is applicable on 
direct commercial sales to foreign governments or international 
organizations.
    (ii) When a particular foreign government or international 
organization has funded the acquisition of specific production and 
research property, do not assess the foreign government or international 
organization rental charges or nonrecurring recoupments for the use of 
such property.
    (3) Waivers. (i) Rental charges for use of U.S. production and 
research property on commercial sales transactions to the Government of 
Canada are waived for all commercial contracts. This waiver is based on 
an understanding wherein the Government of Canada has agreed to waive 
its rental charges.
    (ii) Requests for waivers or reduction of charges for the use of 
Government facilities on work for foreign governments or international 
organizations shall be submitted to the contracting officer who shall 
refer the matter through contracting channels. In response to these 
requests, approvals may be granted only by the Director, Defense 
Security Assistance Agency for particular sales which are consistent 
with paragraph (1)(iii) of this section.



245.407  Non-Government use of plant equipment.

    (a)(i) Non-Government use of industrial plant equipment (IPE) 
exceeding 25 percent requires prior approval of the--
    (A) Assistant Secretary of the Army (RD&A);
    (B) Assistant Secretary of the Navy (RD&A);

[[Page 348]]

    (C) Assistant Secretary of the Air Force (Acquisition); or
    (D) Director, Defense Logistics Agency.
    (ii) The authority in paragraph (a)(i) of this section may be 
delegated to the head of a contracting activity. Any redelegation 
requires the approval of the Office of the Deputy Under Secretary of 
Defense (Industrial Affairs and Installations).
    (iii) To determine percentage--
    (A) Compute the percentage of non-Government use on time available 
for use. Use contractor's normal work schedule as represented by the 
scheduled production shift hours.
    (B) Use a base time period which is neither less than three months 
nor more than one year.
    (C) Use may be averaged at a single plant for all items costing less 
than $25,000.
    (iv) Contractors should submit requests for non-Government use of 
IPE to the contract administration office at least six weeks before the 
projected use. The requests shall include:
    (A) Total number and acquisition cost of IPE items; and
    (B) For each unit of IPE with an acquisition cost of $25,000 or 
more, an itemized list including nomenclature, plant equipment code, 
year of manufacture and acquisition cost.
    (v) Approving officials shall retain for periodic review, 
documentation of the circumstances justifying non-Government use of IPE.
[56 FR 36448, July 31, 1991, as amended at 62 FR 34127, June 24, 1997]



 Subpart 245.5--Management of Government Property in the Possession of 
                               Contractors



245.505  Records and reports of Government property.



245.505-3  Records of material.

    If adequate controls are in place to meet the requirements of the 
clause at 252.242-7004, Material Management and Accounting System, the 
contractor's material control system may physically commingle 
inventories that may include materials for which costs are charged or 
allocated to fixed-price, cost-reimbursement, and commercial contracts. 
Government-furnished material (GFM) may not be physically commingled 
with other material, nor may GFM be used on contractor's commercial 
work.



245.505-5  Records of plant equipment.

    (a) The contractor may use DD Form 1342, DoD Property Record, as a 
source document for setting up prescribed records.



245.505-6  Special reports of plant equipment.

    The contractor shall prepare a DD Form 1342 in accordance with 
instructions contained in AR 700-43/NAVSUP PUB 5009/AFM 78-9/DLAM 
4215.1, Management of Defense-Owned Industrial Plant Equipment (IPE)--
    (1) Upon receipt and acceptance of each item of IPE including items 
which, though part of a manufacturing system, would otherwise qualify as 
IPE;
    (2) Whenever major changes occur in the data initially submitted to 
Defense Supply Center Richmond (DSCR) (as specified by DLAM 4215.1);
    (3) When IPE, including general purpose components of special test 
equipment which otherwise qualify as IPE, is no longer required for the 
purpose authorized or provided; or
    (4) When disposal is completed.
[56 FR 36448, July 31, 1991, as amended at 62 FR 34127, June 24, 1997]



245.505-14  Reports of Government property.

    (a) Use the clause at 252.245-7001, Reports of Government Property, 
in all solicitations and contracts containing one of the following 
clauses--
    (1) FAR Section 52.245-2, Government Property (Fixed-Price 
Contracts);
    (2) FAR Section 52.245-5, Government Property (Cost Reimbursement, 
Time-and-Material, or Labor-Hour Contracts;
    (3) FAR Section 52.245-7, Government Property (Consolidated 
Facilities);
    (4) FAR Section 52.245-10, Government Property (Facilities 
Acquisition); or
    (5) FAR Section 52.245-11, Government Property (Facilities Use).
[59 FR 27674, May 27, 1994]

[[Page 349]]



  Subpart 245.6--Reporting, Redistribution, and Disposal of Contractor 
                                Inventory



245.601  Definitions.

    (1) Controlled substances means--
    (i) Narcotic, depressant, stimulant, or hallucinogenic drug or 
substance;
    (ii) Any other drug or substance controlled under Title II of the 
Comprehensive Drug Abuse Prevention and Control Act of 1970; or
    (iii) A drug or substance required to be controlled by international 
treaty, convention or protocol.
    (2) Demilitarization means the act of destroying the offensive or 
defensive characteristics of equipment or material to prevent its 
further military or lethal use.
    (3) Production scrap means material left over from the normal 
production process that has only remelting or reprocessing value, e.g., 
textile and metal clippings, borings, and faulty castings and forgings.
    (4) Serviceable or usable property means property that has a 
potential for use or sale value ``as is'' or with minor repairs or 
alterations; only property in Federal Condition Codes A1, A2, A4, A5, 
B1, B2, B4, B5, F7, or F8.



245.603  Disposal methods.



245.603-70  Contractor performance of plant clearance duties.

    (a) Authorization. (1) Contract administration offices (CAOs) may, 
with head of the contracting activity approval and contractor 
concurrence, authorize selected contractors to perform certain plant 
clearance functions if the volume of plant clearance warrants 
performance by the contractor.
    (2) The written authorization shall, as a minimum--
    (i) Designate the contractor as an ``accredited contractor'';
    (ii) Identify the plant clearance actions to be performed;
    (iii) State that the Government may cancel part of or all of the 
authorization to perform plant clearance actions; and
    (iv) Provide for plant clearance officer participation when 
required.
    (b) Government oversight and assistance. (1) The contract 
administration office will ensure regular evaluation of the contractor's 
performance of the plant clearance function and any corrective action 
required.
    (2) The plant clearance officer shall--
    (i) Evaluate the adequacy and ensure compliance with contractor 
procedures;
    (ii) Ensure discrepancies are promptly resolved;
    (iii) Advise the contractor of screening and inventory schedule 
requirements;
    (iv) Respond to contractor requests to withdraw Government-furnished 
property from inventory schedules;
    (v) Evaluate physical, quantitative, and technical allocability of 
contractor inventory prior to disposal using Standard Form 1423, 
Inventory Verification Survey, as a guide;
    (vi) Direct contractor to delay disposition of nonallocable 
inventory pending a contracting officer decision;
    (vii) With the contractor's assistance, establish criteria for 
review and approval of selected contractor disposal decisions;
    (viii) Complete first endorsement section of DD Form 1640, Request 
for Plant Clearance, on referrals from plant clearance officers at prime 
contract administration offices for the disposal of subcontractor 
inventory; forward inventory schedules to the contractor for processing; 
and forward completed case file to the referring activity; and
    (ix) Work with the contractor, screeners, and buyers to ensure that 
the Government receives maximum reutilization and disposal proceeds.
    (c) Accredited contractor plant clearance duties. The accredited 
contractor shall--
    (1) Ensure inventory schedule acceptability. Use DD Form 1637, 
Notice of Acceptance of Inventory, if desired;
    (2) Suspend disposition of property when assets are determined 
nonallocable (FAR 45.606-3);
    (3) Withdraw property from inventory schedules and notify the 
affected screening activities. Obtain plant clearance officer approval 
for withdrawal of Government furnished property from inventory schedules 
(FAR 45.606-4);

[[Page 350]]

    (4) Determine method of disposal under established priorities and 
document disposal decisions and actions;
    (5) Assign the automatic release date and the surplus release date;
    (6) Initiate prescribed screening and effect resulting transfers and 
donations;
    (7) Account for disposal of all contractor inventory and application 
of proceeds and submit to the plant clearance officer a Standard Form 
1424, Inventory Disposal Report, or equivalent;
    (8) Maintain the donable file and release property to eligible 
donees (FAR 45.609);
    (9) Prepare, approve, sign, and maintain official plant clearance 
files and required forms (245.7101);
    (10) Not conduct noncompetitive sales of surplus contractor 
inventory; and
    (11) Notify the plant clearance officer in advance when bidding on 
property.
[56 FR 36448, July 31, 1991, as amended at 56 FR 67220, Dec. 30, 1991]



245.603-71  Disposal of contractor inventory for NATO cooperative projects.

    (a) North Atlantic Treaty Organization (NATO) cooperative project 
agreements may include disposal provisions of jointly acquired property 
without regard to any applicable disposal laws of the United States.
    (b) Disposal of such property may include a transfer of the U.S. 
interest in the property to one of the other governments participating 
in the agreement, or the sale of the property.
    (c) Payment for the transfer or sale of any U.S. interest shall be 
made in accordance with the terms of the project agreement.



245.604  Restrictions on purchase or retention of contractor inventory.

    (1) Contractors authorized to sell inventory may not knowingly sell 
the inventory to any person or that person's agent, employee, or 
household member if that person--
    (i) Is a civilian employee of the DoD or the U.S. Coast Guard; or
    (ii) Is a member of the armed forces of the United States, including 
the Coast Guard; and
    (iii) Has any functional or supervisory responsibilities for or 
within the Defense Reutilization and Marketing Program, or for the 
disposal of contractor inventory.
    (2)(i) A contractor's authority to approve a subcontractor's sale, 
purchase, or retention at less than cost, and the subcontractor's 
authority to sell, purchase, or retain at less than cost if approved by 
a higher-tier contractor, does not include authority to approve--
    (A) A sale by a subcontractor to the next-higher tier contractor or 
to an affiliate of such contractor or of the subcontractor; or
    (B) A sale, purchase, or retention at less than cost, by a 
subcontractor affiliated with the next higher-tier contractor.
    (ii) The written approval of the plant clearance officer is required 
for each excluded sale, purchase, or retention at less than cost.
    (3) Demilitarization. The contractor shall demilitarize contractor 
inventory possessing offensive or defense characteristics, and not 
required within the DoD, in accordance with Defense Demilitarization 
Manual, DoD 4160.21-M-1. In unusual cases the plant clearance officer 
may authorize the purchaser to perform the demilitarization; however, 
the purchaser shall not be granted such authorization if the inventory 
is dangerous.
    (4) Classified inventory. Classified contractor inventory shall be 
disposed of in accordance with applicable security regulations or as 
directed by the contracting officer.
    (5) Dangerous inventory. Contractor inventory dangerous to public 
health or safety shall not be donated or otherwise disposed of unless 
rendered innocuous or until adequate safeguards have been provided.



245.606  Inventory schedules.



245.606-3  Acceptance.

    (a) If the schedules are acceptable, the plant clearance officer 
shall, within 15 days, complete and send the contractor a DD Form 1637, 
Notice of Acceptance of Inventory.
    (b) To assist in verifying inventory allocability, the plant 
clearance officer shall follow the instructions in 245.7201.

[[Page 351]]



245.606-5  Instructions for preparing and submitting schedules of contractor inventory.

    (d) General instructions for completing forms.
    (4) The contractor shall use the following codes together with the 
disposal codes 1 through 9, X, and S (e.g., A1, F7, SS) to indicate the 
condition of the property--
    A--New, used, repaired, or reconditioned property; serviceable and 
issuable to all customers without limitations or restrictions; includes 
material with remaining shelf life of more than six months.
    B--New, used, repaired, or reconditioned property; serviceable and 
issuable or for its intended purpose but restricted from issue to 
specific units, activities, or geographical areas because of its limited 
usefulness or short service-life expectancy; includes material and 
remaining shelf life of three to six months.
    F--Economically reparable property which requires repair, overhaul 
or reconditioning; includes reparable items which are radioactively 
contaminated.
    H--Property which has been determined to be unserviceable and does 
not meet repair criteria.
    S--Property that has no value except for its basic material content.
    (e) Instructions for completing specific forms.
    (4) Inventory Schedule D (Special Tooling and Special Test 
Equipment) (SF 1432).
    (ii) Description.
    For termination inventory included in a settlement proposal, include 
cost of inventory acquired for performance of the entire contract in 
column F1 and cost of inventory acquired solely for the terminated 
portion of the contract in column F2. Cost of inventory acquired for the 
entire contract must be prorated between the terminated and 
nonterminated portions.



245.606-70  Instructions for completing DD Form 1342, DoD Property Record.

    (a) The contractor shall list excess industrial plant equipment 
(IPE) on DD Form 1342, DoD Property Record, and submit it to the 
Government property administrator for review and transmittal to the 
plant clearance officer. For numerically controlled IPE, the contractor 
shall prepare and submit DD Form 1342, section VI, (page 2), Numerically 
Controlled Machine Data.
    (b) Upon receipt of the DD Form 1342, the plant clearance officer 
will--
    (1) Designate the 75th day from the date of receipt as the automatic 
release date (ARD) and the 90th day as the screening completion date 
(SCD); and
    (2) Enter the ARD in Block 24 of the DD Form 1342.



245.607  Scrap.



245.607-1  General.

    (a)(i) The contractor may request a pre-inventory scrap 
determination, made by the plant clearance officer after an on-site 
survey, if inventory is considered without value except for scrap. If 
approved, the contractor may make a single descriptive entry on an 
inventory schedule, generally describing the property and indicating its 
approximate total cost. The plant clearance officer will establish a 
plant clearance case and perform limited screening.
    (ii) If the contractor has an approved scrap procedure, routine 
disposal of production scrap and spoilage is authorized, and a plant 
clearance case is unnecessary. The contractor may similarly dispose of 
worn, broken, mutilated, or otherwise rejected parts from overhaul and 
repair contracts with the approval of the plant clearance officer.
    (iii) In addition to segregating scrap to maximize proceeds, the 
contractor may also consolidate sales of Government and contractor scrap 
if approved by the plant clearance officer. When a consolidated sale is 
approved, the plant clearance officer shall waive the scrap warranty 
required at 245.607-70.
    (iv) When a contractor's approved scrap procedure does not require 
physical segregation of Government and contractor scrap, the plant 
clearance officer shall ensure the proceeds of scrap sale are equitably 
distributed.



245.607-2  Recovering precious metals.

    (b) Precious metals are silver, gold, platinum, palladium, rhodium, 
iridium, osmium, and ruthenium.

[[Page 352]]

    (i) At the beginning of every fiscal year, the Defense Reutilization 
and Marketing Service (DRMS) will provide each contract administration 
office with disposition instructions for certain categories of precious 
metals-bearing property, including scrap and usable items containing 
recoverable quantities of these metals. The disposition instructions--
    (A) Will remain in effect for the entire fiscal year, unless 
modified by DRMS; and
    (B) Will contain a fund citation to be used when disposition 
requires shipment of precious metals-bearing property for recovery.
    (ii) Plant clearance officers shall obtain disposition instructions 
for precious metals-bearing property not covered by the annual 
disposition instructions from the Defense Reutilization and Marketing 
Service, Attn: DRMS-OC, 74 N. Washington Avenue, Battle Creek, MI 49017-
3092.
[59 FR 27674, May 27, 1994]



245.607-70  Scrap warranty.

    (a) If the contractor sells its inventory as scrap to anyone, 
including a holding contractor, the contractor shall include in the 
sales contract a signed copy of DD Form 1639, Scrap Warranty.
    (b) The contracting officer may release the contractor from the 
terms of the scrap warranty in return for consideration paid to the 
Government. The consideration will represent the difference between--
    (1) The sale price of the scrap; and
    (2) A fair and reasonable price for the material if it had been sold 
for purposes other than scrap.
    (c) The contractor shall pay the consideration to the Government and 
the Government may execute the release even though the contract 
containing the warranty was not made directly with the Government.
    (d) If the scrap is resold to a second buyer, the first buyer shall 
obtain a scrap warranty from the second buyer. Upon receipt of the 
second buyer's scrap warranty, the Government will release the first 
buyer from liability under the original warranty.



245.608  Screening of contractor inventory.



245.608-1  General.

    (a) The plant clearance officer shall arrange for inspection of 
property at the contractor's plant if requested by a prospective 
transferee, in such a manner as to avoid interruption of the 
contractor's operations.



245.608-2  Standard screening.

    (b)(1) For the first 30 days, property screening will be limited to 
the contracting agency and the requiring agency, when they are not the 
same. The requiring agency shall have priority for retention of listed 
items.



245.608-5  Special items screening.

    (a) Special test equipment with standard components. (1) The 
contractor shall report any excess special test equipment (STE) using SF 
1432, Inventory Schedule D (Special Tooling and Special Test Equipment). 
The contractor shall list and describe on the inventory schedule all 
general-purpose components which, if economically severable from the 
STE, would otherwise be classified as industrial plant equipment (IPE), 
other plant equipment (OPE), or automatic data processing equipment 
(ADPE).
    (2) The plant clearance officer will perform the initial screening 
of the composite STE unit.
    (A) If the contracting department/agency and the requiring 
department/agency decline the STE or the standard components or do not 
approve their transfer to another contract; then,
    (B) The plant clearance officer will screen the STE and any 
severable components with the--
    (1) General Services Administration--STE unit, less any standard 
components, and nonreportable standard components;
    (2) Defense Supply Center Richmond--IPE components;
    (3) Contractor Inventory Redistribution System--OPE components; and

[[Page 353]]

    (4) Defense Information Systems Agency, Chief Information Officer, 
Defense Automation Resources Management Program Division--ADPE 
components.
[56 FR 36448, July 31, 1991, as amended at 62 FR 34128, June 24, 1997]



245.608-7  Reimbursement of cost for transfer of contractor inventory.

    The Defense Logistics Agency will pay for the movement of industrial 
plant equipment under the direction and control of the Defense 
Industrial Plant Equipment Center.



245.608-70  Contractor inventory redistribution system (CIRS).

    (a) Screen serviceable and usable contractor inventory through CIRS 
when it--
    (1) Is listed on SF 1428, Inventory Schedule B, or SF 1434, 
Inventory Schedule E; and
    (2) Has a national stock number, and line item acquisition value in 
excess of $50; or
    (3) Has a line item acquisition value in excess of $1,000 ($500 for 
furniture) but no national stock number.
    (b) Using Standard Form 120, Report of Excess Personal Property, the 
plant clearance officer will send two copies of SF 1428 or SF 1434 (or 
authorized substitutes) to the Defense Reutilization and Marketing 
Service (DRMS). DRMS will notify the plant clearance officer of items 
processed, not accepted, or available for local area screening.
    (c) Property subject to CIRS processing will be screened within DoD 
for 30 days. On the 31st day, unless otherwise specified on SF Form 120, 
appropriate items not requisitioned by DoD will be reported to the 
General Services Administration (GSA) for standard Federal agency and 
donation screening. Examples of items which are not reportable to GSA 
include usable hazardous cleaners and solvents.
    (d) For requisitioned items, DRMS will issue shipping instructions 
to the plant clearance officer. During the first 45 days of the 
screening period, the plant clearance officer forwards any requisitions 
received to DRMS. After 45 days, the plant clearance officer forwards 
the requisition directly to GSA.
    (e) The contractor sends one copy of the shipping document to DRMS 
when shipment has been made.
    (f) Unless directed by the contracting officer, motor vehicles 
excess to Army and Navy contracts shall not be screened through CIRS.
[56 FR 36448, July 31, 1991, as amended at 60 FR 29501, June 5, 1995]



245.608-71  Screening industrial plant equipment.

    (a) Reporting. Within 15 days of receipt, the plant clearance 
officer will forward two copies of the DD Form 1342, DoD Property 
Record, to the Defense Supply Center Richmond (DSCR), ATTN: JH, 8000 
Jefferson Davis Highway, Richmond, VA 23297-5100, for all IPE not 
condition coded ``X'' or ``S.'' Process IPE condition coded ``X'' or 
``S'' in accordance with department or agency procedures.
    (b) Screening--(1) First 30 days. DSCR will--
    (i) Screen excess IPE against all DoD requirements with priority 
given to requirements of the owning department/agency through the 30th 
day.
    (ii) For items selected, issue shipping instructions containing 
accounting, funding, transportation, routing recommendations, and 
preservation instructions.
    (2) 31st through 75th day. (i) DSCR will report excess IPE to GSA on 
31st day.
    (ii) GSA will--
    (A) Approve department/agency requests on first come-first served 
basis;
    (B) Approve and forward transfer orders to the contract 
administration office; and
    (C) Forward copies of approved transfer orders to DSCR.
    (3) 76th through 90th day. GSA will--
    (i) Provide for screening for donation;
    (ii) Receive, approve and forward donation applications to the 
contract administration office; and
    (iii) Send copies of approved applications to DSCR.
    (4) After 90th day. If DoD requirement is identified, and item is 
available, ship item against the requirement unless compelling reasons 
exist for not shipping item.
    (c) The plant clearance officer shall ensure that a copy of the 
shipping document is submitted to DSCR when IPE

[[Page 354]]

is transferred use-to-use or use-to-storage within DoD.
    (d) When GSA sells IPE that is excess to ownership but not to DoD 
requirements, report the sale to DSCR in accordance with department/
agency procedures.
[56 FR 36448, July 31, 1991, as amended at 62 FR 34128, June 24, 1997]



245.608-72  Screening excess automatic data processing equipment (ADPE).

    Report ADPE that is Government-owned or leased by the contractor 
(with Government purchase option or other interests, including use 
rights) to the Defense Information Systems Agency, Defense Automation 
Resources Management Program Division (DARMP). DARMP does all required 
screening, including General Services Administration screening, for 
ADPE. (See the Defense Automation Resources Management Manual.)
[62 FR 34128, June 24, 1997]



245.609  Donations.

    Agencies may donate, with GSA approval and without expense to the 
United States, certain material not needed by DoD to certain 
organizations such as veterans' organizations, soldiers' monument 
associations, State museums, and incorporated educational, not for 
profit museums. For further guidance, see DoD 4160 .21-M, Defense 
Reutilization and Disposal Manual.



245.610  Sale of surplus contractor inventory.



245.610-1  Responsibility.

    (a) See Subpart 245.73 for sales of contractor inventory under the 
control of DoD.



245.610-3  Proceeds of sale.

    (1) Unless otherwise provided in the contract, the proceeds of any 
sale, purchase, or retention shall be--
    (i) Credited to the Government as part of the settlement agreement;
    (ii) Credited to the price or cost of the contract;
    (iii) Applied as otherwise directed by the contracting officer; or
    (iv) Forwarded to the plant clearance officer. The plant clearance 
officer--
    (A) Within two days after receipt will send the proceeds and a DD 
Form 1131, Cash Collection Voucher, to the designated disbursing 
officer. Identify on the DD Form 1131 the contractor name and contract 
number; or
    (B) For contractors with an approved scrap procedure, will ensure 
the proceeds are appropriately applied to an overhead account. The plant 
clearance officer may assign a representative who, with the assistance 
of the contract auditor, shall periodically validate that proceeds from 
sales of production generated scrap are collected and applied to the 
appropriate account.
    (2) Except as prescribed in paragraph (1)(iv)(B) of this subsection, 
the plant clearance officer will not close the plant clearance case 
until verification is received that the credit has, in fact, been 
properly applied.



245.610-4  Contractor inventory in foreign countries.

    (1) Normally, DRMS disposal activities shall be used to dispose of 
surplus contractor inventory located outside the United States or 
Canada. However, if authorized by the contracting officer, a contractor 
may sell or make other disposition of inventory in foreign countries.
    (2) Sale or other disposition of foreign inventory by the 
contractor, including sale to foreign governments, requires that--
    (i) The sales contract or other document transferring title include 
the following certificate:

    The Purchaser certifies that the property covered by this contract 
will be used in (name of country). In the event of resale or export by 
the Purchaser of any of the property acquired at a price in excess of 
$1,000 United States dollars or equivalent in other currency at the 
official exchange rate, the Purchaser agrees to obtain the approval of 
(name and address of Contracting Officer); and

    (ii) The contracting officer approve sales contracts, resales, or 
exports. Approval is permitted only if--
    (A) The proposed purchaser's name is not on the list of Parties 
Excluded from Procurement Programs; and
    (B) The sales contract or other document forbids exports by 
purchasers and

[[Page 355]]

subpurchasers to communist areas (FAR 25.702) or other prohibited 
destinations.



245.612  Removal and storage.



245.612-3  Special storage at the Government's expense.

    (a) Before authorizing storage, the contracting officer shall ensure 
funds are available to pay for the storage and related tasks. In 
addition, the contracting officer shall ensure an annual review of the 
need for continued storage at Government expense.
    (b) All storage contracts or agreements shall be fully funded and 
separately priced and shall include all allocable costs.



245.613  Property disposal determinations.

    The plant clearance officer shall--
    (1) Record the reason for disposing of the property--
    (i) As scrap and salvage;
    (ii) By abandonment or destruction; and
    (iii) By noncompetitive sale;
    (2) Use DD Form 1641, Disposal Determination/Approval, to record 
disposal determinations; and
    (3) File the completed form in the plant clearance case file.



    Subpart 245.70--Appointment of Property Administrators and Plant 
                           Clearance Officers



245.7001  Selection, appointment, and termination.

    (a) The head of a contracting activity for the Defense Logistics 
Agency, or the head of the contract administration office for other 
departments and agencies shall select, appoint, or terminate (in 
writing) property administrators and plant clearance officers.
    (b) In selecting qualified property administrators and plant 
clearance officers, the appointment authority shall consider experience, 
training, education, business acumen, judgment, character, and ethics.



245.7002  Duties and responsibilities of plant clearance officers.

    The plant clearance officer shall--
    (a) Instruct the contractor on the preparation of inventory 
schedules;
    (b) Make pre-inventory scrap determinations;
    (c) Determine the acceptability of inventory schedules and DD Forms 
1342, DoD Property Record;
    (d) Prepare and maintain plant clearance cases and disposal 
documents;
    (e) Initiate screening and provide technical support to screeners in 
the selection of assets;
    (f) Conduct or arrange for verification of the following--
    (1) Quantity, condition, description, and special processing 
requirements of property listed on inventory schedules;
    (2) Technical and quantitative allocability of property;
    (g) Ensure the timely shipment or release by the contractor of 
property selected for transfer and donation;
    (h) Determine the appropriate method of disposal for items not 
selected for Federal agency use or donation and ensure final plant 
clearance is accomplished;
    (i) Evaluate and monitor the contractor's surplus property sales 
program;
    (j) For individual surplus property sales--
    (1) Approve method of sale;
    (2) Ensure the sales offerings meet prescribed requirements;
    (3) Witness bid openings;
    (4) Evaluate bids;
    (5) Approve sale awards;
    (6) Secure anti-trust clearances, as required;
    (7) Recommend the reasonableness of selling expenses; and
    (8) Ensure that sales proceeds are collected and property credited;
    (k) Monitor ongoing plant clearance actions to ensure delays are 
minimized and, when necessary, work with the contractor and property 
administrator to implement improvements;
    (l) Evaluate the adequacy of the contractor's property disposal 
procedures;
    (m) Support the property administrator during the compliance 
analysis of the disposition portion of the contractor's property control 
procedures;
    (n) Report all disposal deficiencies to the property administrator;

[[Page 356]]

    (o) Account for all contractor inventory reported for disposal by 
the contractor and prepare prescribed plant clearance reports; and
    (p) Advise and assist the contractor, contracting officer, inventory 
manager, Federal agencies, and eligible donees in actions related to the 
proper and timely disposal of contractor inventory.
[57 FR 42632, Sept. 15, 1992]



                  Subpart 245.71--Plant Clearance Forms



245.7101  Forms.

    Use the forms listed below in performance of plant clearance 
actions.



245.7101-1  Standard Form 97, Certificate of Release of a Motor Vehicle (Agency Record Copy).

    Use for transfers, donations, and sales of motor vehicles. The 
contracting officer shall execute the SF 97 and furnish it to the 
purchaser.



245.7101-2  DD Form 1149, Requisition and Invoice Shipping Document.

    Use for transfer and donation of contractor inventory. Donations of 
industrial plant equipment may be shipped via DD Form 1149. This form 
may also be used to consolidate contractor inventory redistribution 
system-directed shipments going to the same destination.



245.7101-3  DD Form 1348-1, DoD Single Line Item Release/Receipt Document.

    Use for shipments of excess industrial plant equipment and 
contractor inventory redistribution system (CIRS) inventory.



245.7101-4  DD Form 1640, Request for Plant Clearance.

    Use to request plant clearance assistance or transfer plant 
clearance.



                  Subpart 245.72--Special Instructions



245.7201  Performing inventory verification and determination of allocability.

    Use the following guidance for verifying inventory schedules--
    (a) Allocability. (1) Review contract requirements, delivery 
schedules, bills of material, and other pertinent material. Determine 
whether schedules include material which--
    (i) Is more than required or reasonably expected to be required for 
completion of the contract; or
    (ii) Might be usable on the current contract, or diverted to other 
commercial work or Government use.
    (2) Review the contractor's--
    (i) Recent purchases of similar material;
    (ii) Plans for current and scheduled production;
    (iii) Stock record entries; and
    (iv) Bills of material for similar items.
    (b) Quantity. Ensure available inventory is in accordance with 
quantities listed on the inventory schedules. While a complete physical 
count of each item is not required, perform sufficient checks to ensure 
accurate quantities.
    (c) Condition. Ensure the inventory condition matches that shown on 
the inventory schedules.



245.7202  Establishing a plant clearance case.

    (a) Upon receipt of an acceptable inventory schedule or a DD Form 
1342, DoD Property Record, the plant clearance officer shall establish a 
plant clearance case file. The case folder will--
    (1) Identify the case number (see 245.7203);
    (2) Indicate the contractor's name and contract number;
    (3) Note the word ``Termination'' if applicable; and
    (4) Consolidate all inventory schedules applicable to one contract 
at the same location, if possible.
    (b) As a minimum, include in the plant clearance case file--

[[Page 357]]

    (1) Inventory schedules or DD Form 1342, DoD Property Record, 
annotated to show all disposal actions;
    (2) Copies of documents forwarding inventory schedules to the 
appropriate screening activity;
    (3) Shipping or other instructions and correspondence directing 
disposition of contractor inventory;
    (4) Shipping documents transferring inventory;
    (5) Inventory verification survey or other documents showing 
completion of allocability review;
    (6) Forms authorizing donation or sale;
    (7) Document showing disposition of proceeds from plant clearance 
actions; and
    (8) Any other documents pertinent to disposal actions, including 
review board cases, antitrust clearances, and inventory disposal 
reports.



245.7203  Assigning plant clearance case numbers.

    (a) Use a three-part, 11-character number constructed as follows:
    (1) Part 1: DoD Activity Address Number (6-character alphanumeric 
code) assigned to the contract administering activity.
    (2) Part 2: Locally assigned 4-character consecutive alphanumeric 
code, beginning each calendar year with 001 continuing as necessary 
through ZZZ. The fourth digit is the last number of the calendar year.
    (3) Part 3: The 11th character is a single letter identifying the 
department/agency:

C--Army
Q--Navy
E--Air Force
L--Marine Corps
U--Defense Logistics Agency
N--Defense Nuclear Agency
M--Defense Mapping Agency
S--NASA
D--Other DoD Activities
O--Non-DoD Activities

    (b) Record the plant clearance number on DD Form 1635, Plant 
Clearance Case Register, or mechanized equivalent.



245.7204  Preparing inventory disposal report.

    (a) Prepare Standard Form 1424, Inventory Disposal Report, for each 
completed plant clearance case. For terminated contracts, prepare a 
consolidated Inventory Disposal Report for each termination docket.
    (b) Distribute the report to the contracting officer and to any 
other activities having an interest in the inventory disposal.
    (c) Items on the form are self-explanatory except:
    (1) Item 12--Insert net change due to shortages, overages, errors, 
pricing, or withdrawals, etc. Explain in item 16, Remarks.
    (2) Item 14--Insert amount contractor is retaining or purchasing at 
full acquisition cost (see FAR 45.605-1).
    (3) Item 15--Insert acquisition cost and net credit (full credit 
less approved handling, transportation, and restocking charges for items 
returned to supplier).
    (4) Item 16--Insert the acquisition cost for all transfers 
accomplished. For lines 16A and 16B, insert subtotals as indicated.
    (5) Item 18--Insert acquisition cost and gross proceeds. When 
approved sale costs are reimbursed from proceeds, show net proceeds in 
Item 26, Remarks.
    (6) Items 20 and 21--Use to identify and report transactions not 
otherwise identified, such as assets shipped to a Government precious 
metals reclamation activity, etc. Further explanation may be provided in 
Item 26, Remarks, if necessary.
    (7) Item 25--Totals dispositions must equal amounts on line 13 and 
must reflect all disposal actions within the case.
    (8) Item 26--Show the specific disposition of proceeds reported in 
Items 14, 15, and 18. Also indicate amounts deleted for specific 
contractor claims, or applied as a credit to the claim. Explain any 
entry requiring explanation.



245.7205  Reporting excess and surplus contractor inventory.

    (a) Contract administration offices with plant clearance 
responsibilities will--
    (1) Use DD Form 1638, Report of Excess and Surplus Contractor 
Inventory, or mechanized equivalent, to report the disposition of 
contractor inventory. Do

[[Page 358]]

not include disposition actions transferred to other offices. Unless 
headquarters of the administering activity directs otherwise, complete 
only the column total for each line of this report.
    (2) Prepare quarterly reports for periods ending March 31, June 30, 
September 30, and December 31. Activities preparing manual reports will 
submit duplicate reports to the headquarters of the administering 
activity within ten working days after the close of the report period. 
(Report Control Symbol DD(I&L)(Q)1430).
    (b) Items on the report are self-explanatory except:
    (1) Line 1--Insert totals from line 7 of the preceding report.
    (2) Line 2--Insert net changes due to shortages, overages, errors, 
or withdrawals (other than purchases or retention at cost).
    (3) Line 3--Insert total excess inventory reported by contractors 
during the report period.
    (4) Line 5--Insert total plant clearance cases completed during the 
report period. Do not report cases as completed until all property is 
disposed. Acquisition cost must equal line 19.
    (5) Line 8--Insert amount retained or withdrawn at full cost.
    (6) Line 9--Insert acquisition cost in the ``Acquisition Cost'' 
column and insert acquisition cost less handling, transportation, or 
restocking charges, in the ``Proceeds'' column.
    (7) Line 10--Insert acquisition cost of all transfers completed 
during the report period. On lines 10A through 10H, insert subtotals 
representing transfers to the agency indicated. Exclude amounts on lines 
10A through 10H when computing line 19 totals.
    (8) Line 12--Insert the acquisition cost and gross proceeds. When 
sale costs are reimbursed from proceeds, show net proceeds in remarks.
    (9) Lines 14 and 15--Used to identify and report other transactions.
    (10) Line 18--Insert Section II totals. Line 18 acquisition cost 
must equal acquisition cost on line 5.



245.7206  Transmitting DD Form 1342, DoD Property Record.

    As a minimum, the plant clearance officer will provide the following 
information in a letter forwarding DD Forms 1342 to DSCR--
    (a) Number of DD Forms 1342 included;
    (b) Automatic release date;
    (c) Screening complete date;
    (d) Contractor's name and address;
    (e) Contract number;
    (f) Contracting activity that awarded the contract under which the 
contractor acquired the equipment;
    (g) Location of the industrial plant equipment;
    (h) Total acquisition cost;
    (i) A statement advising that the automatic release date will not be 
extended;
    (j) A note stating that--
    (1) Request for transfer or shipment must include appropriate fund 
citations for packing, crating, and handling charges; and
    (2) Government bills of lading (GBLs) should be furnished or, if 
shipment will be accomplished by other than GBL, DSCR must cite 
transportation funds; and
    (k) The plant clearance officer's signature block.
[56 FR 36448, July 31, 1991, as amended at 62 FR 34128, June 24, 1997]



          Subpart 245.73--Sale of Surplus Contractor Inventory



245.7301  Policy.

    (a) Screening must be completed before any surplus contractor 
inventory sale.
    (b) Except as provided in 245.7307, sales of surplus contractor 
inventory shall be competitive.
    (c) The headquarters of the contract administration activity must 
approve the use of auctions, spot bids, or retail sales.



245.7302  Competitive sales.



245.7302-1  Property descriptions.

    (a) Describe the property as ``used'' or ``unused.'' Indicate if 
unused property is still in the manufacturer's original containers. 
Qualifying statements such as ``well-preserved'' or ``repairs required'' 
are authorized. Do not use condition codes or the terms ``new'' or 
``salvage.''

[[Page 359]]

    (b) Property descriptions must be accurate and adequate for 
identification by prospective bidders. Use commercial terminology and 
original manufacturer and brand name, if applicable.



245.7302-2  Lotting.

    (a) Consider combining property into lots when the quantities, 
value, or nature of the property makes it uneconomical to sell 
separately.
    (b) When lotting is appropriate and economically practical--
    (1) Size the lots to encourage bidding by small businesses or 
individuals;
    (2) Lot unused items by make or manufacturer, except when quantities 
or dollar values are small;
    (3) Lot commercially similar items when practicable;
    (4) Lot used and unused items separately unless quantities, value, 
or nature of property makes it uneconomical to sell separately;
    (5) Size lots large enough to ensure the selling costs are not 
disproportionate to the anticipated proceeds.



245.7302-3  Alternate bids.

    Offerors may be solicited to bid for groups or for the entire 
offering by use of the following:

    Item __________ (Alternate Bid)
    This item consists of all property listed and described in Items 
________ to ________, inclusive. Award under this item will be made only 
if the highest acceptable bid on this item is equal to, or greater than, 
the total of the highest acceptable bids on Items ________ to ________, 
inclusive.



245.7302-4  Basis for sale.

    (a) Unit price basis--requires the offeror to state the bid price in 
terms of the quantity or weight generally applied in commercial sales of 
similar items.
    (b) Lot price basis--requires the offeror to submit a bid for the 
entire lot. Use the lot price basis of sale only when property cannot be 
sold by unit measure or the potential sales return is small.



245.7302-5  Mailing lists.

    (a) The plant clearance officer will ensure the contractor solicits 
a sufficient number of bidders to obtain adequate competition.
    (b) When large quantities of property, special commodities, or 
unusual geographic locations are involved, the plant clearance officer 
is encouraged to obtain additional listings from: Defense Reutilization 
and Marketing Service, Attn: DRMS-OCR, 74 North Washington Avenue, 
Battle Creek, MI 49017-3092.



245.7303  Formal bid procedures.

    (a) The contractor will use formal invitations for bid unless the 
plant clearance officer approves use of informal bid procedures.
    (b) The contractor shall solicit bids at least 15 calendar days 
before bid opening to allow adequate opportunity to inspect property and 
prepare bids.
    (c) For large sales, the contractor may use summary lists of items 
offered as bid sheets with detailed descriptions attached.
    (d) In addition to mailing or delivering notice of the proposed sale 
to prospective bidders, the contractor may, when the results are 
expected to justify the additional expense--
    (1) Display a notice of the proposed sale in appropriate public 
places.
    (2) Publish a sales notice in appropriate trade journals or 
magazines and local newspapers.
    (e) When the acquisition cost of the property to be sold at one 
time, in one place, is $250,000 or more, the contractor shall send a 
notice of the proposed sale to: U.S. Department of Commerce, Commerce 
Business Daily, Sales Section, P.O. Box 5999, Chicago, IL 60680.
    (1) The contractor shall send the CBD notice at least 20 days before 
bid opening, or date of sale.
    (2) CBD notices shall be--
    (i) Double spaced and in synopsis form suitable for printing;
    (ii) Transmitted by fastest mail available; and
    (iii) Contain the following information in the order listed:
    (A) Name and address of contractor issuing the invitation for bids;
    (B) Name or title, address, and telephone number of the official 
from whom copies of the sales offering and other information can be 
obtained;
    (C) Description of the property to be sold including, when desired, 
the total estimated acquisition cost;

[[Page 360]]

    (D) The number of the invitation or sale;
    (E) The date of the sale or bid opening;
    (F) The type of sale, i.e., sealed bid, spot bid, auction; and
    (G) The location of the property.
    (f) The plant clearance officer or representative will witness the 
bid opening. Within two working days after bid opening, the contractor 
will submit to the plant clearance officer two copies of an abstract of 
all bids, signed by the witnessing Government representative.



245.7304  Informal bid procedures.

    (a) Upon approval of the plant clearance officer, the contractor may 
issue informal invitations to bid (orally, telephonically, or by other 
informal media), provided--
    (1) Maximum practical competition is maintained;
    (2) Sources solicited are recorded; and
    (3) Informal bids are confirmed in writing.
    (b) Bids by the contractor or its employees shall be submitted to 
the plant clearance officer prior to soliciting bids from other 
prospective bidders.



245.7305  Sale approval and award.

    The plant clearance officer will--
    (1) Evaluate bids to establish that the sale price is fair and 
reasonable, taking into consideration--
    (i) Knowledge or tests of the market;
    (ii) Current published prices for the property;
    (iii) The nature, condition, quantity, and location of the property; 
and
    (iv) Information from the Defense Reutilization and Marketing 
Service.
    (2) Approve award to the responsible bidder whose bid is most 
advantageous to the Government, price and other factors considered. 
Award shall not be approved to any bidder who is not eligible to enter 
into a contract with the DoD due to inclusion on the list of Parties 
Excluded from Procurement Programs. If a compelling reason exists to 
award to a bidder on the excluded list, the plant clearance officer 
shall request approval from the headquarters of the administering 
activity.
    (3) Notify the contractor within five working days of the bidder to 
whom an award shall be made. The contractor shall make the award, 
collect the proceeds of the sale, and release the property to the 
purchaser. The contractor shall provide the plant clearance officer with 
evidence of delivery reflecting actual quantities released to the 
purchaser.



245.7306  Sales services.

    When sale services are needed, the plant clearance officer will 
document the reasons in the case file and make arrangements directly 
with the Defense Reutilization and Marketing Service (DRMS) or General 
Services Administration (GSA). The arrangements will include a 
requirement to return all proceeds to the plant clearance officer for 
crediting in compliance with FAR 45.610-3.



245.7307  Non-competitive sales.



245.7307-1  General.

    (a) Non-competitive sales include purchases or retention at less 
than cost by the contractor.
    (b) Non-competitive sales may be made when--
    (1) The contracting department/agency or the plant clearance officer 
determines that this method is essential to expeditious plant clearance;
    (2) The sale is otherwise justified on the basis of circumstances 
listed in 245.7307-2;
    (3) The Government's interests are adequately protected; and
    (4) FAR subpart 1.7 requirements are met.
    (c) Non-competitive sales shall be at fair and reasonable prices not 
less than those reasonably expected under competitive sale.



245.7307-2  Justification.

    (a) Conditions justifying non-competitive sales are--
    (1) Scientific equipment allocated to terminated research and 
development contracts with educational institutions;
    (2) No acceptable bids received under an advertised competitive 
sale;
    (3) Property value so small that anticipated proceeds would not 
warrant formal competitive sale;

[[Page 361]]

    (4) Sale to States, territories, possessions, political subdivisions 
thereof, or tax-supported agencies therein, and the estimated fair 
market value of the property and other satisfactory terms of disposal 
are obtained;
    (5) Specialized nature of the property would not create bidder 
interest;
    (6) Removal of the property would reduce its value or result in 
disproportionate handling expenses; or
    (7) Such action is essential to the Government's interests.
    (b) The contracting department/agency will provide the contract 
administration office the sales justification and any special sales 
provisions when the department/agency decides to sell production 
equipment to the contractor by non-competitive sale.



245.7308  Antitrust notification.

    (a) When contractor inventory with an estimated fair market value of 
$3 million or more or any patents, processes, techniques, or inventions, 
regardless of cost, are sold or otherwise disposed of to private 
interests notify the Attorney General and the General Services 
Administration (GSA) of the proposed terms and conditions of disposal. 
Submit the following information to the Department of Justice and the 
GSA through the contract administration agency channels. Report Control 
Symbol DD-ACQ(AR) 1492 applies.
    (1) Location and description of property (specify tonnage if scrap);
    (2) Proposed sale price (explain if the proposed purchaser was not 
highest bidder);
    (3) Acquisition cost of property;
    (4) Manner of sale, indicating whether by--
    (i) Sealed bid (specify number of bidders solicited and bids 
received);
    (ii) Auction or spot bid (state how sale was advertised); or
    (iii) Negotiation (explain why property was not sold competitively);
    (5) Proposed purchaser's name, address, and trade name (if any) 
under which proposed purchaser is doing business;
    (6) If a corporation, provide state and date of incorporation, and 
name and address of--
    (i) Each holder of 25 percent or more of the corporate stock;
    (ii) Each subsidiary; and
    (iii) Each company under common control with proposed purchaser;
    (7) If a partnership, provide--
    (i) Name and address of each partner; and
    (ii) Other business connections of each partner;
    (8) Nature of proposed purchaser's business (indicate whether its 
scope is local, statewide, regional, or national);
    (9) Estimated dollar volume of sales of proposed purchaser (as of 
latest calendar or fiscal year);
    (10) Estimated net worth of proposed purchaser; and
    (11) Intended use of property.
    (b) Do not dispose of property until the Attorney General determines 
whether the proposed disposal action would tend to create or maintain a 
situation inconsistent with the antitrust laws.
    (c) If the Attorney General advises that the proposed disposition is 
inconsistent with the antitrust laws, do not continue with the proposed 
disposition.
    (d) Under non-competitive sales, the prospective purchaser shall be 
informed that final consummation of the sale is subject to determination 
by the Attorney General.
    (e) Under competitive or non-competitive sales, the purchaser is 
required to provide the information required in paragraph (a) of this 
subsection.
[56 FR 36448, July 31, 1991, as amended at 57 FR 42633, Sept. 15, 1992; 
57 FR 53601, Nov. 12, 1992]



245.7309  Mandatory terms and conditions--formal invitations.

    Sale by formal invitation shall include, as a minimum, the terms and 
conditions in this section.



245.7309-1  Inspection.

    The Bidder is invited to inspect the property prior to submitting a 
bid. Property will be available for inspection at the places and times 
specified in the Invitation. Failure to inspect property does not 
constitute grounds for the withdrawal of a bid after opening.

[[Page 362]]



245.7309-2  Condition and location of property.

    (a) Unless otherwise specifically provided in the Invitation, all 
property is offered for sale ``as is'' and ``where is.'' If the 
Invitation provides that the Contractor will load, then ``where is'' 
means f.o.b. conveyance at the point specified in the Invitation.
    (b) The description is based on the best available information. 
However, the Contractor makes no warranty, express or implied, as to 
quantity, kind, character, quality, weight, size, or description of the 
property or its fitness for any use or purpose.
    (c) Except as provided in Conditions 245.7306-8, Variations in 
Quantity or Weight, and 245.7306-10, Risk of Loss, no request for 
adjustment in price or for rescission of the sale will be considered. 
This is not a sale by sample.



245.7309-3  Consideration of bids.

    (a) Bidder agrees that this bid is firm and irrevocable within the 
acceptance period specified in the Invitation (or, if not specified, not 
less than ten or more than 60 days).
    (b) The right is reserved to reject any or all bids, to waive any 
technical defects in bids, and, unless otherwise specified in the 
offering or by the Bidder, to accept any one item or group of items in 
the bid. Unless the invitation provides otherwise, bids--
    (1) May be on any or all items;
    (2) Must be submitted on the unit basis specified for that item;
    (3) Must cover the total number of units designated for that item; 
and
    (4) Unit prices govern.



245.7309-4  Payment.

    (a) Purchaser agrees to pay the full purchase price for awarded 
property at the prices quoted in the bid. Unless an adjustment is 
required pursuant to Condition 245.7306-8, Variations in Quantity or 
Weight, payment must be made within the time specified for removal and 
prior to delivery of any of the property. In the event that any 
adjustment is made, payment must be made immediately after such 
adjustment.
    (b) The full purchase price, or balance if a bid deposit was 
required, shall be paid to the Contractor in cash or by certified check, 
cashier's check, traveler's check, bank draft, or postal or express 
money order. The Contractor is not required to extend credit to any 
purchaser.
    (c) The Contractor reserves the right to apply any bid deposits made 
under this Invitation by a bidder against any amounts due under a 
contract awarded by the Contractor under this Invitation. If the total 
sum due to the contractor is less than the amount deposited with the 
bid, the difference shall be promptly refunded. Deposits accompanying 
bids which are not accepted shall be promptly returned.



245.7309-5  Title.

    (a) Unless otherwise specified in the Invitation, title to property 
sold under this Invitation shall vest in the Purchaser when full payment 
is made. If the Invitation provides for loading by the Contractor, title 
shall not vest until payment and loading are completed.
    (b) A Standard Form 97, Certificate of Release of a Motor Vehicle, 
(or a State certificate of title) shall be furnished for motor vehicles 
and motor-propelled or motor-drawn equipment requiring licensing.



245.7309-6  Delivery and removal of property.

    (a) Unless otherwise specified in the Invitation, the Purchaser 
shall be entitled to obtain the property upon vesting of title in the 
Purchaser. Delivery shall be made at the designated location, and 
removal will be at the Purchaser's expense within the time frame 
specified in the Invitation or any additional time allowed by the 
Contractor.
    (b) The Purchaser shall reimburse the Contractor for any damage to 
the Contractor's property caused by Purchaser's removal operations. If 
additional time is required to remove the property, the Contractor, 
without limiting any other rights, may require the Purchaser to pay 
reasonable storage charges.



245.7309-7  Default.

    If the successful Bidder fails to make full payment, remove property 
by the specified date, or comply with any other terms and conditions of 
sale, the

[[Page 363]]

Contractor reserves the right to sell or otherwise dispose of any or all 
such property and to charge losses and incidental expenses to the 
defaulting Bidder. Bid deposits received (if required in the Invitation) 
shall be applied against such losses and expenses.



245.7309-8  Variations in quantity or weight.

    When property is sold on a ``unit price'' basis, the Contractor 
reserves the right to vary by up to 15 percent the quantity or weight 
listed in the Invitation and the Purchaser agrees to accept delivery of 
any quantity or weight within these limits. The purchase price shall be 
adjusted in accordance with the unit price and on the basis of the 
quantity or weight delivered.



245.7309-9  Weighing.

    (a) When weighing is necessary to determine the exact purchase 
price, the Purchaser shall arrange for and pay all weighing expenses. 
When removal is by truck, weighing shall be subject to supervision and 
accomplished on--
    (1) Contractor scales;
    (2) Certified scales; or
    (3) Other scales acceptable to both parties.
    (b) When removal is by rail, weighing shall be on railroad scales or 
by other means acceptable to the railroad for freight purposes. The 
Purchaser shall pay switching charges.



245.7309-10  Risk of loss.

    The Contractor is responsible for reasonable care and protection of 
the property until the date specified for removal. All risk of loss, 
damage, or destruction from any cause whatsoever shall be borne by the 
Purchaser after passage of title.



245.7309-11  Liability.

    Contractor and Government liability, when liability has been 
established, shall not exceed the refund of any portion of the purchase 
price already received by the Contractor.



245.7309-12  Oral statements.

    Any oral statement by the Contractor changing or supplementing the 
contract or any condition thereof is unauthorized.



245.7309-13  Eligibility of bidders.

    The Bidder shall certify that the Bidder is not--
    (a) A civilian employee of the Department of Defense or the United 
States Coast Guard whose duties include any functional or supervisory 
responsibility for disposal of contractor inventory;
    (b) A member of the United States Armed Forces, including the Coast 
Guard, whose duties include any functional or supervisory responsibility 
for disposal of contractor inventory;
    (c) An agent, employee or immediate member of the household of 
personnel in paragraphs (a) and (b).



245.7309-14  Claims liability.

    The Purchaser or Bidder agrees to save the Contractor and Government 
harmless from any and all claims, demands, actions, debts, liabilities, 
judgments, costs, and attorney's fees arising out of, claimed on account 
of, or in any manner predicated upon loss of or damage to property of, 
and injuries to or the death of any and all persons whatsoever, in any 
manner caused or contributed to by the Purchaser or Bidder, their 
agents, servants or employees, while in, upon, or about the sale site on 
which the property sold or offered for sale is located, or while going 
to or departing from such areas; and to save the Contractor and 
Government harmless from and on account of damages of any kind which the 
Contractor may suffer as the result of the acts of any of the 
Purchaser's agents, servants, or employees while in or about the said 
sites.



245.7310  Special term and conditions.

    When necessary, include the special conditions of this section in 
formal invitations.



245.7310-1  Demilitarization.

    When demilitarization of property is required, whether on or off 
contractor or Government premises, the invitation must include the 
following clause:

    (a) Demilitarization.

[[Page 364]]

    Item(s) ________ require demilitarization by the Purchaser in the 
manner and to the degree set forth below:
    (1) For property located in the United States insert item number(s) 
and specific demilitarization requirements for item(s) shown in 
Attachment 1, Part 2 of Defense, Demilitarization Manual;
    (2) For property located outside the United States, insert item 
number(s) and specific demilitarization requirements for item(s) shown 
in Attachment 1, Part 3 of DoD 4160.21-M-1, Defense Demilitarization 
Manual.
    (b) Demilitarization on Government Premises.
    Property requiring demilitarization shall not be removed, and title 
shall not pass to the Purchaser, until demilitarization has been 
completed and approved by an authorized Contractor and Government 
representative. Demilitarization will be accomplished as specified in 
the contract. Component parts vital to the military or lethal purpose of 
the property shall be rendered unusable. The Purchaser agrees to assume 
all cost incident to the demilitarization and to restore the working 
area to its present condition after removing the demilitarized property.
    (c) Demilitarization on Non-Government Premises. Property requiring 
demilitarization shall be demilitarized by the Purchaser under 
supervision of qualified Department of Defense personnel. Title shall 
not pass to the Purchaser until demilitarization has been completed by 
the Purchaser and approved by an authorized Contractor and Government 
representative. Demilitarization will be accomplished as specified in 
the contract. Component parts vital to the military or lethal purpose of 
the property shall be rendered unusable. The Purchaser agrees to assume 
all costs incident to the demilitarization.
    (d) Failure to Demilitarize. If the Purchaser fails to demilitarize 
the property as specified in the contract, the Contractor may, upon 
giving ten days written notice from date of mailing to the Purchaser--
    (1) Repossess, demilitarize, and return the property to the 
Purchaser. The Purchaser hereby agrees to pay to the Contractor, prior 
to the return of the property, all costs incurred by the Contractor in 
repossessing, demilitarizing, and returning the property to the 
Purchaser.
    (2) Repossess, demilitarize, and resell the property, and charge the 
defaulting Purchaser will all excess costs incurred by the Contractor. 
The Contractor shall deduct these costs from the purchase price and 
refund the balance of the purchase price, if any, to the Purchaser. In 
the event the excess costs exceed the purchase price, the defaulting 
Purchaser hereby agrees to pay these excess costs to the Contractor.
    (3) Repossess and resell the property under similar terms and 
conditions. In the event this option is exercised, the Contractor shall 
charge the defaulting Purchaser with all excess costs incurred by the 
Contractor. The Contractor shall deduct these excess costs from the 
original purchase price and refund the balance of the purchase price, if 
any, to the defaulting Purchaser. Should the excess costs to the 
Contractor exceed the purchase price, the defaulting Purchaser hereby 
agrees to pay these excess costs to the Contractor.



245.7310-2  Performance bond.

    Performance bonds are required when work, other than loading, is to 
be performed by the purchaser and a bond is considered necessary to 
ensure performance. Generally, performance bonds shall be 100 percent of 
the estimated cost of the work to be performed. If a 100 percent 
performance bond would be disadvantageous to the Contractor or to the 
Government, the amount may be reduced to not less than 50 percent of the 
estimated cost of the work. Include the following condition when 
performance bonds are required:

                            Performance Bond

    Within ten days after notice of award, the Purchaser shall furnish a 
performance bond in the sum of $________ to cover the Purchaser's 
obligations. Such bond shall remain in full force and effect during the 
term of the contract and any extensions as may be agreed upon. The 
Purchaser shall not be permitted to begin performance until the bond has 
been received.



245.7310-3  Liability and insurance.

    When the work to be performed by the purchaser warrants, use the 
following:

                         Liability and Insurance

    The Purchaser shall at the Purchaser's own expense purchase and 
maintain during the term of the contract insurance as follows:
    (a) Standard workers' compensation and employer's liability 
insurance required under State and Federal statutes. However, the 
Contractor may waive this requirement upon receipt of satisfactory 
evidence that the Purchaser is qualified as a self-insurer under 
applicable provisions of law.
    (b) Bodily injury liability insurance in an amount not less than 
$300,000 for any one occurrence; and
    (c) Property damage liability insurance.

[[Page 365]]



245.7310-4  Dangerous property.

    The following warning shall be included when it cannot be certified 
that the property is completely harmless:

                           Dangerous Property

    Purchasers are warned that the property purchased may contain items 
of an explosive, toxic, or inflammable nature, notwithstanding 
reasonable care exercised by the Contractor to render the property 
harmless. The Contractor and the Government assume no liability for 
damage to the property of the Purchaser, or for personal injuries or 
disabilities to the Purchaser or the Purchaser's employees, or to any 
other person, arising from or incident to the purchase of the property, 
or its use or disposition by the Purchaser. The Purchaser shall save the 
Contractor and the Government harmless from any and all such claims.



245.7310-5  Controlled substances.

    The sale of controlled substances, e.g., narcotics, stimulants, 
depressants, or hallucinogenic drugs, shall be subject to the following 
special conditions:
    (a) Controlled Substances. Bids will be rejected unless the Bidder 
submits the following certification with its bid:

    The undersigned represents and warrants that it is registered under 
The Comprehensive Drug Abuse Prevention and Control Act of 1970, and is 
authorized under the law and by the Attorney General, U.S. Department of 
Justice (Bureau of Narcotics and Dangerous Drugs) to buy controlled 
substances as a medical practitioner, dealer or manufacturer of 
controlled substances.

    (b) Narcotic Drugs and Chemicals. Bids will be rejected unless the 
Bidder submits the following certification with its bid:

    The undersigned represents and warrants that it is registered under 
Federal narcotics laws and is authorized by law and by the Bureau of 
Narcotics, United States Treasury Department, as a manufacturer of 
narcotics.



245.7310-6  Radioactive material.

    The following shall be used whenever the property offered for sale 
is capable of emitting ionized radiation:

                          Radioactive Material

    Purchasers are warned that the property may be capable of emitting 
ionized radiation. The Contractor and the Government assume no liability 
for damage to the property of the Purchaser, or for personal injuries or 
disabilities to the Purchaser or the Purchaser's employees, or to any 
other person arising from or incident to the purchase of the property or 
its use or disposition by the Purchaser. The Purchaser shall hold the 
Contractor and the Government harmless from all such claims. The 
Purchase should warn possessors or users of the property that it may be 
capable of emitting ionized radiation.



245.7310-7  Scrap warranty.

    The following condition shall be used whenever property, other than 
production scrap, is offered for sale as scrap:

                             Scrap Warranty

    The Purchaser represents and warrants that the property will be used 
only as scrap, and will not be resold until--
    (a) Scrapping has been accomplished; or
    (b) The Purchaser obtains an identical warranty from any subsequent 
purchaser.



245.7310-8  Antitrust clearance.

    When property with an acquisition cost of $3 million or more is to 
be sold, include the following in the invitation:

                                Antitrust

    When the property offered for sale has an acquisition cost of $3 
million or more, or consists of patents, processes, techniques, or 
inventions, irrespective of cost, the successful Bidder shall be 
required to furnish additional information and shall allow up to 60 days 
for acceptance of its bid. Award shall be made only upon advice from the 
Department of Justice that the proposed sale would not create or 
maintain a situation inconsistent with the antitrust laws.



245.7311  Optional conditions.

    The following special conditions of sale may be added at the option 
of the contractor:



245.7311-1  Sales and use tax liability.

    For purchases of property subject to a state sales or use tax, a 
special condition of sale may stipulate that the Purchaser shall pay and 
the Contractor shall collect the amount of the tax, which shall be 
itemized separately on the billing document.

[[Page 366]]



245.7311-2  Safety, security, and fire regulations.



245.7311-3  Bid deposits.



245.7311-4  Other special conditions.

    Other special conditions considered necessary by the Contractor are 
subject to the prior approval of the plant clearance officer. Approval 
will normally be granted provided the prescribed conditions of sale are 
not altered or affected and the interest of the Government is not 
adversely affected.



PART 246--QUALITY ASSURANCE--Table of Contents




Sec.

                         Subpart 246.1--General

246.101  Definitions.
246.102  Policy.
246.103  Contracting office responsibilities.
246.104  Contract administration office responsibilities.

              Subpart 246.2--Contract Quality Requirements

246.202  Types of contract quality requirements.
246.202-4  Higher-level contract quality requirements.
246.203  Criteria for use of contract quality requirements.

                     Subpart 246.3--Contract Clauses

246.370  Material inspection and receiving report.

          Subpart 246.4--Government Contract Quality Assurance

246.406  Foreign governments.
246.407  Nonconforming supplies or services.
246.408  Single-agency assignments of Government contract quality 
          assurance.
246.408-70  Subsistence.
246.408-71  Aircraft.
246.408-72  Construction projects.
246.470  Government contract quality assurance actions.
246.470-1  Planning.
246.470-2  Evidence of conformance.
246.470-3  Assessment of additional costs.
246.470-4  Maintenance of Government records.
246.470-5  Quality evaluation data.
246.471  Authorizing shipment of supplies.
246.472  Inspection stamping.

        Subpart 246.6--Material Inspection and Receiving Reports

246.670  General.
246.671  Procedures.

                        Subpart 246.7--Warranties

246.701  Definitions.
246.702  General.
246.703  Criteria for use of warranties.
246.704  Authority for use of warranties.
246.705  Limitations.
246.706  Warranty terms and conditions.
246.708  Warranties of data.
246.710  Contract clauses.
246.770  Warranties in weapon system acquisitions.
246.770-1  Definitions.
246.770-2  Policy.
246.770-3  Tailoring warranty terms and conditions.
246.770-4  Warranties on Government-furnished property.
246.770-5  Exemption for alternate source contractor(s).
246.770-6  Applicability to foreign military sales (FMS).
246.770-7  Cost-benefit analysis.
246.770-8  Waiver and notification procedures.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36460, July 31, 1991, unless otherwise noted.



                         Subpart 246.1--General



246.101  Definitions.

    Metrology is the science of weights and measures used to determine 
conformance to technical requirements including the development of 
standards and systems for absolute and relative measurements.
    Quality means the composite of material attributes including 
performance features and characteristics of a product or service to 
satisfy a given need.
    Quality assurance is a planned and systematic pattern of all actions 
necessary to provide adequate confidence that adequate technical 
requirements are established; products and services conform to 
established technical requirements; and satisfactory performance is 
achieved.
    Quality audit is a systematic examination of the acts and decisions 
with respect to quality in order to independently verify or evaluate the 
operational requirements of the quality

[[Page 367]]

program or the specification or contract requirements of the product or 
service.
    Quality program is a program which is developed, planned, and 
managed to carry out cost-effectively all efforts to effect the quality 
of materials and services from concept exploration and definition 
through demonstration and validation, engineering and manufacturing 
development, production and deployment, and operations and support.
[56 FR 36460, July 31, 1991, as amended at 60 FR 33145, June 27, 1995]



246.102  Policy.

    Departments and agencies shall also--
    (1) Develop and manage a cost effective quality program to ensure 
that contract performance conforms to specified requirements. Apply the 
quality program to all contracts for services and products designed, 
developed, purchased, produced, stored, distributed, operated, 
maintained, or disposed of by contractors.
    (2) Conduct quality audits to ensure the quality of products and 
services meet contractual requirements.
    (3) Base the type and extent of Government contract quality 
assurance actions on the particular acquisition.
    (4) Provide contractors the maximum flexibility in establishing 
efficient and effective quality programs to meet contractual 
requirements. Contractor quality programs may be modeled on military, 
commercial, national, or international quality standards.
[56 FR 36460, July 31, 1991, as amended at 60 FR 33145, June 27, 1995]



246.103  Contracting office responsibilities.

    The contracting office may conduct product-oriented surveys and 
evaluations to determine--
    (1) The adequacy of the technical requirements relating to quality; 
and
    (2) Product conformance to design intent. Consider conducting the 
surveys and evaluations in conjunction with the activity responsible for 
technical requirements.
    (a) Contracting offices are also responsible for--
    (i) Assisting the technical activity in improving the quality 
requirements for contracts when first identified for competitive 
acquisition; and
    (ii) Assisting in determining the cause of problems noted in user 
experience reports.
    (b) The contracting office must coordinate with the quality 
assurance activity before changing any quality requirement.
    (c) The activity responsible for technical requirements may prepare 
instructions covering the type and extent of Government inspections for 
acquisitions that are complex, have critical applications, or have 
unusual requirements.
    (i) In preparing the instructions, the technical activity shall 
consider, as applicable--
    (A) The past quality history of the contractor;
    (B) The criticality of the material procured in relation to its 
intended use, considering such factors as--
    (1) Reliability;
    (2) Safety;
    (3) Interchangeability; and
    (4) Maintainability;
    (C) Problems encountered in the development of the material;
    (D) Problems encountered in other procurements of the same or 
similar material;
    (E) Available feed-back data from contract administration, 
receiving, testing, or using activities; and
    (F) The experience of other contractors in overcoming manufacturing 
problems.
    (ii) The instructions shall--
    (A) Be kept to a minimum;
    (B) Comply with 246.470-2; and
    (C) Be prepared on a contract-by-contract basis.
    (iii) The instructions shall not--
    (A) Serve as a substitute for incomplete contract quality 
requirements;
    (B) Impose greater inspection requirements than are in the contract;
    (C) Use broad or general designations such as--
    (1) All requirements;
    (2) All characteristics; or
    (3) All characteristics in the classification of defects;
    (D) Be used for routine administrative procedures; or
    (E) Specify continued inspection requirements when statistically 
sound

[[Page 368]]

sampling will provide an adequate degree of protection.
    (iv) After issuing the instructions, the technical activity--
    (A) Must provide the contract administration office available 
information regarding those factors which resulted in the requirement 
for Government inspection;
    (B) Must periodically analyze the need to continue, change, or 
discontinue the instructions; and
    (C) Must advise the contract administration office of the results of 
the periodic analyses.



246.104  Contract administration office responsibilities.

    (f) The contract administration office shall continue to follow any 
specific written instructions received from the contracting office until 
the contracting office acts on a recommendation.



              Subpart 246.2--Contract Quality Requirements



246.202  Types of contract quality requirements.



246.202-4  Higher-level contract quality requirements.

    (1) Higher-level contract quality requirements are used in addition 
to a standard inspection requirement.
    (2) Higher-level contract quality requirements, including 
nongovernment quality system standards adopted to meet DoD needs, are 
listed in the DoD Index of Specifications and Standards.
[60 FR 33145, June 27, 1995. Redesignated and amended at 60 FR 61599, 
Nov. 30, 1995]



246.203  Criteria for use of contract quality requirements.

    (c) Criticality. Acquisitions of critical items, whether peculiar or 
common, shall have contract quality requirements.



                     Subpart 246.3--Contract Clauses



246.370  Material inspection and receiving report.

    (a) Use the clause at 252.246-7000, Material Inspection and 
Receiving Report, in solicitations and contracts when there will be 
separate and distinct deliverables, even if the deliverables are not 
separately priced.
    (b) When contract administration is retained by the contracting 
office, the clause at 252.246-7000, Material Inspection and Receiving 
Report, is not required for--
    (1) Contracts awarded using small and other simplified purchase 
procedures (FAR part 13);
    (2) Negotiated subsistence contracts;
    (3) Contracts for fresh milk and related fresh dairy products;
    (4) Contracts for which the deliverable is a scientific or technical 
report;
    (5) Research and development contracts not requiring the delivery of 
separately priced end items;
    (6) Base, post, camp, or station contracts;
    (7) Contracts in overseas areas when the preparation and 
distribution of the DD Form 250, Material Inspection and Receiving 
Report, by the contractor would not be practicable. In these cases, 
arrange for the contractor to provide the information necessary for the 
contracting office to prepare the DD Form 250;
    (8) Contracts for services when hardware is not acquired as an item 
in the contract; and
    (9) Indefinite delivery type contracts placed by central contracting 
offices which authorize only base, post, camp, or station activities to 
issue orders.



          Subpart 246.4--Government Contract Quality Assurance



246.406  Foreign governments.

    (1) Quality assurance among North Atlantic Treaty Organization 
(NATO) countries--(i) NATO Standardization Agreement (STANAG) 4107, 
Mutual Acceptance of Government Quality Assurance. (A) STANAG 4107--
    (1) Contains procedures, terms, and conditions under which one NATO 
country will perform quality assurance for another NATO country, or for 
a NATO organization.
    (2) With certain reservations, has been ratified by the U.S. and 
other nations in NATO.
    (B) Departments and agencies--
    (1) May ask NATO countries to perform quality assurance;

[[Page 369]]

    (2) Shall perform quality assurance when requested by a NATO 
country.
    (C) The U.S. Government reserves the right to require reimbursement 
for work it performs for other NATO countries and organizations.
    (ii) NATO Standardization Agreement (STANAG) 4108, Allied Quality 
Assurance Publications. (A) STANAG 4108 provides for the application of 
Allied Quality Assurance Publications (AQAPs).
    (B) Its annexes list AQAPs and the criteria for applying those AQAPs 
which are required in contracts between NATO countries.
    (2) International military sales (non-NATO). Departments and 
agencies shall--
    (i) Perform quality assurance services on international military 
sales contracts or in accordance with existing agreements;
    (ii) Ensure conformance to the technical and quality requirements of 
international military sales contracts;
    (iii) Inform host or U.S. Government personnel and contractors on 
the use of quality assurance publications;
    (iv) Specify appropriate quality requirements in contracts awarded 
to other countries; and
    (v) Delegate quality assurance to the host government when 
satisfactory services are available.
    (3) Reciprocal quality assurance agreements. A Memorandum of 
Understanding (MOU) with a foreign country may contain an annex that 
provides for the reciprocal performance of quality assurance services. 
MOUs should be checked to determine whether such an annex exists for the 
country where a defense contract will be performed. (See subpart 225.74 
for more information about MOUs.)



246.407  Nonconforming supplies or services.

    (1) Contracting officers shall use the following MIL-STD-109 
definitions in determining conformance with contract requirements--
    (i) Critical nonconformance is a nonconformance that judgment and 
experience indicate--
    (A) Is likely to result in hazardous or unsafe conditions for 
individuals using, maintaining, or depending upon the supplies or 
services; or
    (B) Is likely to prevent performance of a vital agency mission.
    (ii) Major nonconformance is a nonconformance, other than critical, 
that is likely to result in failure, or to materially reduce the 
usability of the supplies or services for their intended purpose.
    (iii) Minor nonconformance is a nonconformance that is not likely to 
materially reduce the usability of the supplies or services for their 
intended purpose, or is a departure from established standards having 
little bearing on the effective use or operation of the supplies or 
services.
    (2) Contracting officers shall ensure that--
    (i) Nonconformances are identified; and
    (ii) The significance of a nonconformance is established when 
considering the acceptability of supplies or services which do not meet 
contract requirements.
    (f) If nonconforming material or services are discovered after 
acceptance, the defect appears to be the fault of the contractor, any 
warranty has expired, and there are no other contractual remedies, the 
contracting officer--
    (i) Shall notify the contractor in writing of the nonconforming 
material or service;
    (ii) Shall request that the contractor repair or replace the 
material, or perform the service, at no cost to the Government; and
    (iii) May accept consideration if offered. For guidance on 
solicitation of a refund, see subpart 242.71.



246.408  Single-agency assignments of Government contract quality assurance.



246.408-70  Subsistence.

    (a) The Surgeons General of the military departments are responsible 
for--
    (1) Acceptance criteria;
    (2) Technical requirements; and
    (3) Inspection procedures needed to assure wholesomeness of foods.
    (b) The contracting office may designate any Federal activity, 
capable of assuring wholesomeness and quality in food, to perform 
quality assurance for subsistence contract items. The designation may--

[[Page 370]]

    (1) Include medical service personnel of the military departments; 
and
    (2) Be on a reimbursable basis.



246.408-71  Aircraft.

    (a) The Federal Aviation Administration (FAA) has certain 
responsibilities and prerogatives in connection with some commercial 
aircraft and of aircraft equipment and accessories (Pub. L. 85-726 (72 
Stat 776, 49 U.S.C. 1423)). This includes the issuance of various 
certificates applicable to design, manufacture, and airworthiness.
    (b) FAA evaluations are not a substitute for normal DoD evaluations 
of the contractor's quality assurance measures. Actual records of FAA 
evaluations may be of use to the contract administration office (CAO) 
and should be used to their maximum advantage.
    (c) The CAO shall ensure that--
    (1) The supplies and services conform to the terms of the contract; 
and
    (2) The contractor possesses any required FAA certificates and 
approvals prior to acceptance.



246.408-72  Construction projects.

    (a) The department or agency responsible for the construction of a 
building or other structure is normally responsible for on-site 
inspection.
    (b) The contract administration office performs quality assurance 
for construction materials and supplies acquired for military and civil 
works projects.
    (c) The offices responsible for on-site inspection and for quality 
assurance of materials and supplies must coordinate their efforts to 
ensure the compatibility of buildings and structures and installed 
equipment.



246.470  Government contract quality assurance actions.



246.470-1  Planning.

    In systematically planning Government contract quality assurance 
actions used to determine a contractor's compliance with contract 
quality requirements, consider--
    (a) The relative importance of the product; and
    (b) The variety of tasks required of the available resources.



246.470-2  Evidence of conformance.

    Use objective evidence of quality to determine conformance to 
contract quality requirements.



246.470-3  Assessment of additional costs.

    (a) Under the clause at FAR 52.246-2, Inspection of Supplies--Fixed-
Price, the Government may charge the contractor for additional costs 
incurred by the Government due to delays in tests or inspections caused 
by the contractor, or due to the necessity for reinspection or retest. 
This action may be necessary when--
    (1) Supplies are not ready at the time such inspection and test are 
requested by the contractor; or
    (2) Reinspection or retest is necessitated by prior rejection.
    (b) After considering the factors in paragraph (d) of this 
subsection, the quality assurance representative (QAR) may believe that 
the assessment of additional costs is warranted. If so, the 
representative shall recommend that the contracting officer take the 
necessary action and provide a recommendation as to the amount of 
additional costs. Costs are based on the applicable Federal agency, 
foreign military sale, or public rate in effect at the time of the 
delay, reinspection, or retest.
    (c) If the contracting officer agrees with the QAR, the contracting 
officer shall--
    (1) Notify the contractor, in writing, of the determination to 
exercise the Government's right under the clause at FAR 52.246-2, 
Inspection of Supplies--Fixed Price; and
    (2) Demand payment of the costs in accordance with the collection 
procedures contained in FAR subpart 32.6.
    (d) In making a determination to assess additional costs, the 
contracting officer shall consider--
    (1) The frequency of delays, reinspection, or retest under both 
current and prior contracts;
    (2) The cause of such delay, reinspection, or retest; and
    (3) The expense of recovering the additional costs.

[[Page 371]]



246.470-4  Maintenance of Government records.

    The contract administration office shall maintain suitable records 
of the quality assurance performance of contractors.



246.470-5  Quality evaluation data.

    The contract administration office shall establish a system that 
provides, as a minimum, for the collection, evaluation, and use of--
    (a) Quality data developed by the contractor during performance;
    (b) Data developed by the Government through contract quality 
assurance actions; and
    (c) Reports by users and customers.



246.471  Authorizing shipment of supplies.

    (a) General. (1) Ordinarily, a representative of the contract 
administration office signs or stamps the shipping papers that accompany 
Government source-inspected supplies to release them for shipment. This 
is done for both prime and subcontracts.
    (2) An alternative procedure (see paragraph (b) of this section) 
permits the contractor to assume the responsibility for releasing the 
supplies for shipment.
    (3) The alternative procedure may include prime contractor release 
of supplies inspected at a subcontractor's facility.
    (4) The use of the alternative procedure releases DoD manpower to 
perform technical functions by eliminating routine signing or stamping 
of the papers accompanying each shipment.
    (b) Alternative Procedures--Contract Release for Shipment. (1) The 
contract administration office may authorize, in writing, the contractor 
to release supplies for shipment when--
    (i) The stamping or signing of the shipping papers by a 
representative of the contract administration office interferes with the 
operation of the Government contract quality assurance program or takes 
too much of the Government representative's time;
    (ii) There is sufficient continuity of production to permit the 
Government to establish a systematic and continuing evaluation of the 
contractor's control of quality; and
    (iii) The contractor has a record of satisfactory quality, including 
that pertaining to preparation for shipment.
    (2) The contract administration office shall withdraw, in writing, 
the authorization when there is an indication that the conditions in 
paragraph (b)(1) of this subsection no longer exist.
    (3) When the alternative procedure is used, require the contractor 
to--
    (i) Type or stamp, and sign, the following statement on the required 
copy or copies of the shipping paper(s), or on an attachment--

    The supplies in this shipment--
    1. Have been subjected to and have passed all examinations and tests 
required by the contract;
    2. Were shipped in accordance with authorized shipping instructions;
    3. Conform to the quality, identity, and condition called for by the 
contract; and
    4. Are of the quantity shown on this document.
    This shipment was--
    1. Released in accordance with section 246.471 of the Defense FAR 
Supplement; and
    2. Authorized by (name and title of the authorized representative of 
the contract administration office) in a letter dated (date of 
authorizing letter). (Signature and title of contractor's designated 
official.)

    (ii) Release and process, in accordance with established 
instructions, the DD Form 250, Material Inspection and Receiving Report, 
or other authorized receiving report.



246.472  Inspection stamping.

    (a) There are two DoD quality inspection approval marking designs 
(stamps). Both stamps are used--
    (1) Only by, or under the direct supervision of, the Government 
representative; and
    (2) For both prime and subcontracts.
    (b) The designs of the two stamps and the differences in their uses 
are--
    (1) Partial (Circle) Inspection Approval Stamp. (i) This circular 
stamp is used to identify material inspected for conformance to only a 
portion of the contract quality requirements.
    (ii) Further inspection is to be performed at another time and/or 
place.
    (iii) Material not inspected is so listed on the associated DD Form 
250 (Material Inspection and Receiving Report), packing list, or 
comparable document.

[[Page 372]]

    (2) Complete (Square) Inspection Approval Stamp. (i) This square 
stamp is used to identify material completely inspected for all contract 
quality requirements at source.
    (ii) The material satisfies all contract quality requirements and is 
in complete conformance with all contract quality requirements 
applicable at the time and place of inspection.
    (iii) Complete inspection approval establishes that material which 
once was partially approved has subsequently been completely approved.
    (iv) One imprint of the square stamp voids multiple imprints of the 
circle stamp.
    (c) The marking of each item is neither required nor prohibited. 
Ordinarily, the stamping of shipping containers, packing lists, or 
routing tickets serves to adequately indicate the status of the material 
and to control or facilitate its movement.
    (d) Stamping material does not mean that it has been accepted by the 
Government. Evidence of acceptance is ordinarily a signed acceptance 
certificate on the DD Form 250, Material Inspection and Receiving 
Report.
    (e) Policies and procedures regarding the use of National 
Aeronautics and Space Administration (NASA) quality status stamps are 
contained in NASA publications. When requested by NASA centers, the DoD 
inspector shall use NASA quality status stamps in accordance with 
current NASA requirements.



        Subpart 246.6--Material Inspection and Receiving Reports



246.670  General.

    (a) Material Inspection and Receiving Reports (MIRRs) are used to 
document--
    (1) Contract quality assurance;
    (2) Acceptance of supplies and services; and
    (3) Shipments.
    (b) MIRRs are used by activities responsible for--
    (1) Receiving;
    (2) Status control;
    (3) Technical requirements;
    (4) Contracting;
    (5) Inventory control;
    (6) Requisitioning; and
    (7) Payment.



246.671  Procedures.

    See Appendix F, Material Inspection and Receiving Report, for 
procedures and instructions for the use, preparation, and distribution 
of--
    (a) The Material Inspection and Receiving Report (DD Form 250 
series) and;
    (b) Supplier's commercial shipping/packing lists used to evidence 
Government contract quality assurance.



                        Subpart 246.7--Warranties



246.701  Definitions.

    Acceptance, as defined in FAR 46.701 and as used in this subpart and 
in the warranty clauses at FAR 52.246-17, Warranty of Supplies of a 
Noncomplex Nature; FAR 52.246-18, Warranty of Supplies of a Complex 
Nature; FAR 52.246-19, Warranty of Systems and Equipment Under 
Performance Specifications or Design Criteria; and FAR 52.246-20, 
Warranty of Services, includes the execution of an official document 
(e.g., DD Form 250, Material Inspection and Receiving Report) by an 
authorized representative of the Government.
    Defect, as used in this subpart, means any condition or 
characteristic in any supply or service furnished by the contractor 
under the contract that is not in compliance with the requirements of 
the contract.



246.702  General.

    (c) Departments and agencies shall establish procedures to track and 
accumulate data on warranty costs.



246.703  Criteria for use of warranties.

    The use of warranties in the acquisition of weapon systems is 
mandatory (10 U.S.C. 2403) unless a waiver is authorized (see 246.770-
8).
    (b) Cost. Contracting officers may include the cost of a warranty as 
part of an item's price or as a separate contract line item.



246.704  Authority for use of warranties.

    The chief of the contracting office must approve use of a warranty, 
except in acquisitions for--
    (1) Weapon systems (see 246.770);

[[Page 373]]

    (2) Commercial items (see FAR 46.709);
    (3) Technical data, unless the warranty provides for extended 
liability (see 246.708);
    (4) Supplies and services in fixed-price type contracts containing 
quality assurance provisions that reference higher-level contract 
quality requirements (see 246.202-4); or
    (5) Supplies and services in construction contracts when using the 
warranties that are contained in Federal, military, or construction 
guide specifications.
[56 FR 36460, July 31, 1991, as amended at 60 FR 33145, June 27, 1995; 
60 FR 61599, Nov. 30, 1995]



246.705  Limitations.

    (a) Warranties in the clause at 252.246-7001, Warranty of Data, are 
also an exception to the prohibition on use of warranties in cost-
reimbursement contracts.



246.706  Warranty terms and conditions.

    (b)(5) Markings. Use MIL Standard 129, Marking for Shipments and 
Storage, and MIL Standard 130, Identification Marking of U.S. Military 
Property, when marking warranty items.



246.708  Warranties of data.

    Obtain warranties on technical data when practicable and cost 
effective. Consider the factors in FAR 46.703 in deciding whether to 
obtain warranties of technical data. Consider the following in deciding 
whether to use extended liability provisions--
    (1) The likelihood that correction or replacement of the 
nonconforming data, or a price adjustment, will not give adequate 
protection to the Government; and
    (2) The effectiveness of the additional remedy as a deterrent 
against furnishing nonconforming data.



246.710  Contract clauses.

    (1) Use a clause substantially the same as the clause at 252.246-
7001, Warranty of Data, in solicitations and contracts that include the 
clause at 252.227-7013, Rights in Technical Data and Computer Software, 
and there is a need for greater protection or period of liability than 
provided by other contract clauses, such as the clauses at--

    (i) FAR 52.246-3, Inspection of Supplies--Cost-Reimbursement;
    (ii) FAR 52.246-6, Inspection--Time-and-Material and Labor-Hour;
    (iii) FAR 52.246-8, Inspection of Research and Development--Cost-
Reimbursement; and
    (iv) FAR 52.246-19, Warranty of Systems and Equipment Under 
Performance Specifications or Design Criteria.

    (2) Use the clause at 252.246-7001, Warranty of Data, with its 
Alternate I when extended liability is desired and a fixed price 
incentive contract is contemplated.
    (3) Use the clause at 252.246-7001, Warranty of Data, with its 
Alternate II when extended liability is desired and a firm fixed price 
contract is contemplated.
    (4) Use the clause at 252.246-7002, Warranty of Construction 
(Germany), in solicitations and contracts for construction when a fixed-
price contact will be awarded and contract performance will be in 
Germany.
[56 FR 36460, July 31, 1991, as amended at 62 FR 34128, June 24, 1997]



246.770  Warranties in weapon system acquisitions.

    This section sets forth policies and procedures for use of 
warranties in contracts for weapon system production.



246.770-1  Definitions.

    As used in this section--
    (a) At no additional cost to the Government means--
    (1) At no increase in price for firm fixed price contracts;
    (2) At no increase in target or ceiling price for fixed price 
incentive contracts (see also FAR 46.707); or
    (3) At no increase in estimated cost or fee for cost-reimbursement 
contracts.
    (b) Design and manufacturing requirements means structural and 
engineering plans and manufacturing particulars, including precise 
measurements, tolerances, materials and finished product tests for the 
weapon system being produced.
    (c) Essential performance requirements means the operating 
capabilities and

[[Page 374]]

maintenance and reliability characteristics of a weapon system that the 
agency head determines to be necessary to fulfill the military 
requirement.
    (d) Initial production quantity means the number of units of a 
weapon system contracted for in the first program year of full-scale 
production.
    (e) Mature full-scale production means follow-on production of a 
weapon system after manufacture of the lesser of the initial production 
quantity or one-tenth of the eventual total production quantity.
    (f) Weapon system means a system or major subsystem used directly by 
the Armed Forces to carry out combat missions.
    (1) The term includes, but is not limited to, the following (if 
intended for use in carrying out combat missions)--
    (i) Tracked and wheeled combat vehicles;
    (ii) Self-propelled, towed and fixed guns, howitzers and mortars;
    (iii) Helicopters;
    (iv) Naval vessels;
    (v) Bomber, fighter, reconnaissance and electronic warfare aircraft;
    (vi) Strategic and tactical missiles including launching systems;
    (vii) Guided munitions;
    (viii) Military surveillance, command, control, and communication 
systems;
    (ix) Military cargo vehicles and aircraft;
    (x) Mines;
    (xi) Torpedoes;
    (xii) Fire control systems;
    (xiii) Propulsion systems;
    (xiv) Electronic warfare systems; and
    (xv) Safety and survival systems.
    (2) The term does not include--
    (i) Commercial items;
    (ii) Spares, repairs, or replenishment parts; or
    (iii) Related support equipment (e.g., ground-handling equipment, 
training devices and accessories, ammunition), unless an effective 
warranty would require inclusion of such items.



246.770-2  Policy.

    (a) Under 10 U.S.C. 2403, departments and agencies may not contract 
for the production of a weapon system with a unit weapon system cost of 
more than $100,000 or an estimated total procurement cost in excess of 
$10 million unless--
    (1) Each contractor for the weapon system provides the Government 
written warranties that--
    (i) The weapon system conforms to the design and manufacturing 
requirements in the contract (or any modifications to that contract),
    (ii) The weapon system is free from all defects in materials and 
workmanship at the time of acceptance or delivery as specified in the 
contract; and
    (iii) The weapon system, if manufactured in mature full-scale 
production, conforms to the essential performance requirements of the 
contract (or any modification to that contract); and
    (2) The contract terms provide that, in the event the weapon system 
fails to meet the terms of the above warranties, the contracting officer 
may--
    (i) Require the contractor to promptly take necessary corrective 
action (e.g., repair, replace, and/or redesign) at no additional cost to 
the Government;
    (ii) Require the contractor to pay costs reasonably incurred by the 
Government in taking necessary corrective action, or
    (iii) Equitably reduce the contract price; or
    (3) A waiver is granted under 246.770-8.
    (b) Contracting officers and program managers shall consider the 
following when developing and negotiating weapon system warranty 
provisions:
    (1) Warranties may not be appropriate in all situations, and a 
waiver should be sought if a warranty would not be cost-effective or 
would otherwise be inconsistent with the national defense. In drafting 
warranty provisions, the drafters must ensure they understand the 
planned operational, maintenance, and supply concepts of the weapon 
system to be fielded, and must structure a warranty that matches those 
concepts. A warranty plan should be prepared in consonance with 
development of the warranty provision early in the weapon system's life 
cycle. The plan should contain program warranty strategy, terms of the 
warranty, administration and enforcement

[[Page 375]]

requirements, and should be coordinated with the user and support 
activities.
    (2) A cost/benefit analysis must be accomplished in support of each 
warranty (see 246.770-7). The cost/benefit analysis compares all costs 
associated with the warranty to the expected benefits. An estimate shall 
be made of the likelihood of defects and the estimated cost of 
correcting such defects. Also, if substantive changes are required to 
the planned operational, maintenance, or supply concepts, any increased 
costs should be weighed against the expected benefits in deciding 
whether a warranty is cost-effective.
    (3) The Warranty Guidebook prepared by the Defense Systems 
Management College, Fort Belvoir, VA 22060-5426, is a valuable reference 
that can assist in the development, negotiation, and administration of 
an effective weapon system warranty.
    (c) Contracting officers may require warranties that provide greater 
coverage and remedies than specified in paragraph (a) of this 
subsection.
    (d) When the contract includes an essential performance requirement 
warranty, the warranty must identify redesign as a remedy available to 
the Government.
    (1) The period during which redesign must be available as a remedy 
shall not end before operational use, operational testing, or a 
combination of operational use and operational testing has demonstrated 
that the warranted item's design has satisfied the essential performance 
requirements.
    (2) When essential performance requirements are warranted in 
contracts with alternate source contractors, do not include redesign as 
a remedy available to the Government under those contracts until the 
alternate source has manufactured the first ten percent of the eventual 
total production quantity anticipated to be acquired from that 
contractor (see 246.770-5).
[56 FR 36460, July 31, 1991, as amended at 59 FR 7749, Feb. 29, 1996]



246.770-3  Tailoring warranty terms and conditions.

    (a) Since the objectives and circumstances vary considerably among 
weapon system acquisition programs, contracting officers must tailor the 
required warranties on a case-by-case basis. The purpose of tailoring is 
to get a cost-effective warranty in light of the technical risk, or 
other program uncertainties, while ensuring that the Government still 
acquires the basic warranties described in 246.770-2. Tailoring shall 
not be used as a substitute for acquiring a warranty waiver.
    (1) Tailoring may affect remedies, exclusions, limitations, and 
duration provided such are consistent with the specific requirements of 
this section (see also FAR 46.706).
    (2) Clearly relate the duration of any warranty to the contract 
requirements and allow sufficient time to demonstrate achievement of the 
requirements after acceptance.
    (3) Tailor the terms of the warranty, if appropriate, to exclude 
certain defects for specified supplies (exclusions) or to limit the 
contractor's liability under the terms of the warranty (limitations).
    (4) Structure broader and more comprehensive warranties when 
advantageous or narrow the scope when appropriate. For example, it may 
be inappropriate to require warranty of all essential performance 
requirements for a contractor that did not design the system.
    (b) DoD policy is to exclude any terms that cover contractor 
liability for loss, damage, or injury to third parties from warranty 
clauses.
    (c) Ensure acquisition of subsystems and components in a manner 
which does not affect the validity of the weapon system warranty.



246.770-4  Warranties on Government-furnished property.

    Contracting officers shall not require contractors to provide the 
warranties specified in 246.770-2 on any property furnished the 
contractor by the Government, except for--
    (a) Defects in installation;
    (b) Installation or modification in such a manner that invalidates a 
warranty provided by the manufacturer of the property; or
    (c) Modifications made to the property by the contractor.

[[Page 376]]



246.770-5  Exemption for alternate source contractor(s).

    Agency heads may exempt alternate source contractor(s) from the 
essential performance warranty requirements of 246.770-2(a)(1)(iii) 
until that contractor manufactures the first ten percent of its 
anticipated total production quantity.



246.770-6  Applicability to foreign military sales (FMS).

    (a) The warranty requirements of 246.770-2 are not mandatory for FMS 
production contracts. DoD policy is to obtain the same warranties on 
conformance to design and manufacturing requirements and against defects 
in material and workmanship as it gets for U.S. supplies.
    (b) DoD normally will not obtain essential performance warranties 
for FMS purchasers. However, where contracting officer cannot separately 
identify the cost for the warranty of essential performance 
requirements, the foreign purchaser shall be given the same warranty 
that the United States gets.
    (c) If an FMS purchaser expressly requests a performance warranty in 
the letter of acceptance, the Government will exert its best efforts to 
obtain the same warranty obtained for U.S. equipment. Or, if 
specifically requested by the FMS purchaser, obtain a unique warranty.
    (d) The costs for warranties for FMS purchasers may be different 
from the costs for such warranties for the Government due to factors 
such as overseas transportation and any tailoring to reflect the unique 
aspects of the FMS purchaser.
    (e) Ensure that FMS purchasers bear all of the acquisition and 
administrative costs of any warranties.



246.770-7  Cost-benefit analysis.

    (a) In assessing the cost effectiveness of a proposed warranty, 
perform an analysis which considers both the quantitative and 
qualitative costs and benefits of the warranty. Consider--
    (1) Costs of warranty acquisition, administration, enforcement, and 
user costs, and any costs resulting from limitations imposed by the 
warranty provisions;
    (2) Costs incurred during development specifically for the purpose 
of reducing production warranty risks;
    (3) Logistical and operational benefits as a result of the warranty 
as well as the impact of the additional contractor motivation provided 
by the warranty.
    (b) Where possible, make a comparison with the costs of obtaining 
and enforcing similar warranties on similar systems.
    (c) Document the analysis in the contract file. If the warranty is 
not cost effective, initiate a waiver request under 246.770-8.



246.770-8  Waiver and notification procedures.

    (a) The Secretary of Defense has delegated waiver authority within 
the limits specified in 10 U.S.C. 2403. The waiving authority for the 
defense agencies is the Under Secretary of Defense (Acquisition and 
Technology). Submit defense agency waiver requests to the Director, 
Defense Procurement, for processing. The waiving authority for the 
military departments is the Secretary of the department with authority 
to redelegate no lower than an Assistant Secretary. The waiving 
authority may waive one or more of the weapon system warranties required 
by 246.770-2 if--
    (1) The waiver is in the interests of national defense; or
    (2) The warranty would not be cost effective.
    (b) Waiving authorities must make the following notifications or 
reports to the Senate and House Committees on Armed Services and 
Appropriations for all waivers--
    (1) Major weapon systems. For a weapon system that is a major 
Defense acquisition program for the purpose of 10 U.S.C. 2432, the 
waiving official must notify the Committees in writing of an intention 
to waive one or more of the required warranties. Include an explanation 
of the reasons for the waiver in the notice. Ordinarily provide the 
notice 30 days before granting a waiver.
    (2) Weapon systems not in mature full-scale production. Although a 
waiver is not required, if a production contract for a major weapon 
system not yet in mature full-scale production will not

[[Page 377]]

include a warranty on essential performance requirements, the waiving 
officials must comply with the notice requirements for major weapon 
systems.
    (c) Departments and agencies shall issue procedures for processing 
waivers and notifications to Congress.
    (1) Requests for waiver shall include--
    (i) A brief description of the weapon system and its stage of 
production, e.g., the number of units delivered and anticipated to be 
delivered during the life of the program;
    (ii) Identification of the specific warranty or warranties required 
by 246.770-2(a)(1) for which the waiver is requested;
    (iii) The duration of the waiver if it is to go beyond the contract;
    (iv) The rationale for the waiver (if the waiver request is based on 
cost effectiveness, include the results of the cost-benefit analysis);
    (v) A description of the warranties or other techniques used to 
ensure acceptable field performance of the weapon system, e.g., 
warranties, commercial or other guarantees obtained on individual 
components; and
    (vi) Exercise date of the warranty option, if applicable.
    (2) Notifications shall include--
    (i) A brief description of the weapon system and its stage of 
production; and
    (ii) Rationale for not obtaining a warranty.
    (3) Keep a written record of each waiver granted and notification 
and report made, together with supporting documentation such as a cost-
benefit analysis, for use in answering inquiries.
[56 FR 36460, July 31, 1991, as amended at 61 FR 7750, Feb. 29, 1996]



PART 247--TRANSPORTATION--Table of Contents




Sec.

                         Subpart 247.1--General

247.103  Transportation Documentation and Audit Regulation (TDA).
247.104  Government rate tenders under section 10721 of the Interstate 
          Commerce Act.
247.104-3  Cost-reimbursement contracts.
247.104-5  Citation of Government rate tenders.
247.105  Transportation assistance.

   Subpart 247.2--Contracts for Transportation or for Transportation-
                            Related Services

247.270  Stevedoring contracts.
247.270-1  Scope of section.
247.270-2  Definitions.
247.270-3  Type of contract.
247.270-4  Technical provisions.
247.270-5  Evaluation of bids and proposals.
247.270-6  Award of contract.
247.270-7  Contract clauses.
247.271  Contracts for the preparation of personal property for shipment 
          or storage.
247.271-1  Scope of section.
247.271-2  Policy.
247.271-3  Procedures.
247.271-4  Solicitation provisions, schedule formats, and contract 
          clauses.

            Subpart 247.3--Transportation in Supply Contracts

247.305  Solicitation provisions, contract clauses, and transportation 
          factors.
247.305-10  Packing, marking, and consignment instructions.
247.305-70  Returnable containers other than cylinders.
247.370  Use of Standard Form 30 for consignment instructions.
247.371  DD Form 1384, Transportation Control and Movement Document.
247.372  DD Form 1653, Transportation Data for Solicitations.
247.373  DD Form 1654, Evaluation of Transportation Cost Factors.

        Subpart 247.5--Ocean Transportation by U.S.-Flag Vessels

247.570  Scope.
247.571  Policy.
247.572  Procedures.
247.572-1  Ocean transportation incidental to a contract for supplies, 
          services, or construction.
247.572-2  Direct purchase of ocean transportation services.
247.573  Solicitation provision and contract clauses.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36466, July 31, 1991, unless otherwise noted.



                         Subpart 247.1--General



247.103  Transportation Documentation and Audit Regulation (TDA).

    (b)(2) Appendix J of the Defense Traffic Management Regulation lists 
the carriers and carrier associations that have agreed to provide 
transportation

[[Page 378]]

under commercial forms and procedures within CONUS.



247.104  Government rate tenders under section 10721 of the Interstate Commerce Act.



247.104-3  Cost-reimbursement contracts.

    (a) Section 10721 rates do not apply to foreign military sale (FMS) 
shipments.
    (i) On shipments of stock fund items from a contractor to a depot, 
when some of the items in a specific transportation unit are clearly for 
FMS--
    (A) Section 10721 rates do not apply to FMS items shipped on a 
separate bill of lading; and
    (B) Section 10721 rates do apply to the non-FMS items.



247.104-5  Citation of Government rate tenders.

    (a) See section XI, chapter 32 of the Defense Traffic Management 
Regulation for instructions on converting commercial bills of lading to 
Government bills of lading within CONUS.



247.105  Transportation assistance.

    (a)(i) Transportation assistance includes all transportation 
factors, such as--
    (A) Freight rates (for evaluation of bids or routing purposes);
    (B) Other transportation costs;
    (C) Transit agreements;
    (D) Time in transit;
    (E) Port handling charges; and
    (F) Port capabilities.
    (ii) Within CONUS, the Military Traffic Management Command (MTMC), 
through its eastern and western area commands, is responsible for the 
performance of traffic management functions. These functions include the 
direction, control, and supervision of all functions incident to the 
acquisition and use of commercial freight and passenger transportation 
services. See chapters 1 and 2 of the Defense Traffic Management 
Regulation for the locations and geographical areas of jurisdiction of 
each area headquarters.
    (iii) For assistance with international shipments--
    (A) Originating in CONUS, request assistance from the appropriate 
military activity; i.e., the Air Mobility Command (AMC), Military 
Sealift Command (MSC), MTMC, or the military service sponsoring the 
cargo;
    (B) For all modes of transportation originating overseas, request 
assistance from the overseas Theater Commander assigned responsibility 
for common-user, military-operated land transportation;
    (C) Of bulk petroleum via ocean tanker, request assistance, rates, 
or other costs from the MSC;
    (D) Of supplies between points outside the CONUS, including Alaska 
and Hawaii, request assistance, rates, or other costs from the military 
service sponsoring the cargo. Direct the requests to:

Army: Deputy Chief of Staff for Logistics, Department of the Army, Attn: 
DALO-TSP, Washington, DC 20310-0570
Navy: Naval Supply Systems Command, Code 051, Washington, DC 20390-5000
Air Force

    Applicable overseas Air Force Command, HQ PACAF/LGT, 25 East Street, 
suite I-326, Hickam AFB, HI 96853-5427.
    HQ USAFE/LGT, Unit 3050, Box 105, APO AE 09049-0105.
    HQ AFSPACECOM/LGT, 150 Vandenberg Street, suite 1105, Peterson AFB, 
CO 80914-4435.

Marine Corps: Director, Transportation Division, HQ, U.S. Marine Corps, 
COS, Washington, DC 20380

    (E) When requesting rates and related costs for the evaluation of 
bids or proposals, include the bid opening or proposal due date and the 
expected date of initial shipment, if established.
[56 FR 36466, July 31, 1991, as amended at 59 FR 27674, May 27, 1994]



   Subpart 247.2--Contracts for Transportation or for Transportation-
                            Related Services



247.270  Stevedoring contracts.



247.270-1  Scope of section.

    This section contains procedures peculiar to stevedoring. Other 
portions of the FAR and DFARS dealing with service contracting also 
apply to stevedoring contracts.



247.270-2  Definitions.

    Commodity rate is--

[[Page 379]]

    (1) The price quoted for handling a ton (weight or measurement) of a 
specified commodity.
    (2) Computed by dividing the hourly stevedoring gang cost by the 
estimated number of tons of the specified commodity which can be handled 
in 1 hour.
    Gang cost is--
    (1) The total hourly wages paid to the workers in the gang, in 
accordance with the collective bargaining agreement between the maritime 
industry and the unions at a specific port; and
    (2) Payments for workmen's compensation, social security taxes, 
unemployment insurance, taxes, liability and property damage insurance, 
general and administrative expenses, and profit.
    Stevedoring is the--
    (1) Loading of cargo from an agreed point of rest on a pier or 
lighter and its storage aboard a vessel; or
    (2) Breaking out and discharging of cargo from any space in the 
vessel to an agreed point of rest dockside or in a lighter.



247.270-3  Type of contract.

    Normally, use an indefinite-quantity type contract.



247.270-4  Technical provisions.

    (a) Because conditions vary at different ports, and sometimes within 
the same port, it is not practical to develop standard technical 
provisions covering all phases of stevedoring operations.
    (b) When including car loading and unloading or other dock and 
terminal work under a stevedoring contract, include these requirements 
as separate items of work.



Sec. 247.270-5  Evaluation of bids and proposals.

    At a minimum, require that offers include--
    (a) Tonnage or commodity rates which apply to the bulk of the cargo 
worked under normal conditions;
    (b) Labor-hour rates which apply to services not covered by 
commodity rates, or to work performed under hardship conditions; and
    (c) Cost of equipment rental.
[59 FR 50852, Oct. 6, 1994]



Sec. 247.270-6  Award of contract.

    Make the award to the contractor submitting the offer most 
advantageous to the Government, considering cost or price and other 
factors specified elsewhere in the solicitation. Evaluation will 
include, but is not limited to--
    (a) Total estimated cost of tonnage to be moved at commodity rates;
    (b) Estimated cost at labor-hour rates; and
    (c) Cost of equipment rental.
[59 FR 50852, Oct. 6, 1994]



247.270-7  Contract clauses.

    Use the following clauses in solicitations and contracts for 
stevedoring services as indicated--
    (a) 252.247-7000, Hardship Conditions, as appropriate;
    (b) 252.247-7001, Price Adjustment, when using sealed bidding;
    (c) 252.247-7002, Revision of Prices, when using negotiation;
    (d) 252.247-7003, Termination, when it is desirable to permit either 
party to terminate the contract;
    (e) 252.247-7004, Indefinite Quantities-Fixed Charges, when the 
contract will provide for the payment of fixed charges;
    (f) 252.247-7005, Indefinite Quantities-No Fixed Charges, when the 
contract will not provide for the payment of fixed charges;
    (g) 252.247-7006, Removal of Contractor's Employees; and
    (h) 252.247-7007, Liability and Insurance.



247.271  Contracts for the preparation of personal property for shipment or storage.



247.271-1  Scope of section.

    This section contains procedures peculiar to the preparation of 
personal property for shipment or storage, and for the performance of 
intra-area or intra-city movement. Other portions of the FAR and DFARS 
dealing with service contracting also apply to these services.



247.271-2  Policy.

    (a) Annual contracts. Normally--

[[Page 380]]

    (1) Use requirements contracts awarded through sealed bidding to 
acquire services for the--
    (i) Preparation of personal property for shipment or storage; and
    (ii) Performance of intra-area movement.
    (2) Award contracts on a calendar year basis.
    (3) Provide for option years.
    (4) Award contracts, or exercise option years, before November 1 of 
each year, if possible.
    (b) Areas of performance. Define clearly in the solicitation each 
area of performance.
    (1) Establish one or more areas; however, hold the number to a 
minimum consistent with local conditions.
    (2) Each schedule may provide for the same or different areas of 
performance. Determine the areas as follows--
    (i) Use political boundaries, streets, or any other features as 
lines of demarcation. Consider such matters as--
    (A) Total volume;
    (B) Size of overall area; and
    (C) The need to service isolated areas of high population density.
    (ii) Specifically identify frequently used terminals, and consider 
them as being included in each area of performance described in the 
solicitation.
    (c) Maximum requirements-minimum capability. The contracting officer 
shall--
    (1) Establish realistic quantities on the Estimated Quantities 
Report in DoD 4500.34-R, Personal Property Traffic Management 
Regulation;
    (2) Ensure that the Government's minimum acceptable daily 
capability--
    (i) Will at least equal the maximum authorized individual weight 
allowance as prescribed by the Joint Federal Travel Regulations; and
    (ii) Will not preclude bidding by small business firms.



247.271-3  Procedures.

    (a) CONUS military activities assigned multi-service personal 
property areas of responsibility. (1) When two or more military 
installations or activities have personal property responsibilities in a 
given area, one activity shall contract for the estimated requirements 
of all activities in the area. The installation commanders concerned 
shall designate the activity by mutual agreement.
    (2) The Commander, MTMC, shall designate the contracting activity 
when local commanders are unable to reach agreement.
    (b) Additional services and excess requirements. (1) Excess 
requirements are those services which exceed contractor capabilities 
available under contracts. Use small purchase procedures to satisfy 
excess requirements.
    (2) Additional services are those not specified in the bid items.
    (i) Additional services may include--
    (A) Hoisting or lowering of articles;
    (B) Waiting time;
    (C) Special packaging; and
    (D) Stuffing or unstuffing of sea van containers.
    (ii) Consider contracting for local moves that do not require 
drayage by using hourly rate or constructive weight methods. The rate 
will include those services necessary for completion of the movement, 
including--
    (A) Packing and unpacking;
    (B) Movement;
    (C) Inventorying; and
    (D) Removal of debris.
    (iii) Each personal property shipping activity shall determine if 
local requirements exist for any additional services.
    (iv) The contracting officer may obtain additional services by--
    (A) Including them as items within the contract; provided, they are 
not used in the evaluation of bids (see 252.247-7008, Evaluation of 
Bids); or
    (B) Using small purchase procedures.
    (v) Either predetermine prices for additional services with the 
contractor, or negotiate them on a case-by-case basis.
    (vi) The contracting officer must authorize the contractor to 
perform any additional services, other than attempted pick up or 
delivery, regardless of the contracting method.
    (vii) To the maximum extent possible, identify additional services 
required that are incidental to an order before placing the order; or, 
when applicable, during the premove survey.
    (c) Contract distribution. In addition to the distribution 
requirements of FAR subpart 4.2, furnish one copy of each contract as 
follows--

[[Page 381]]

    (1) CONUS personal property shipping activities shall send the copy 
to the Commander, Military Traffic Management Command, Attn: MTPP-CI, 
Room 408, 5611 Columbia Pike, Falls Church, VA 22041-5050.
    (2) In the European and Pacific areas, personal property shipping 
activities shall send the copy to either the Property Directorate, MTMC 
Europe, or the MTMC Field Office-Pacific.
    (3) Other overseas personal property shipping activities shall send 
the copy to the Commander, Military Traffic Management Command, Attn: 
MTPP-Q, 5611 Columbia Pike, Falls Church, VA 22041-5050.



247.271-4  Solicitation provisions, schedule formats, and contract clauses.

    When acquiring services for the preparation of personal property for 
movement or storage, and for performance of intra-city or intra-area 
movement, use the following provisions, clauses, and schedules. Revise 
solicitation provisions and schedules, as appropriate, if using 
negotiation rather than sealed bidding. Overseas commands, except those 
in Alaska and Hawaii, may modify these clauses to conform to local 
practices, laws, and regulations.
    (a) The provision at 252.247-7008, Evaluation of Bids. When adding 
``additional services'' items to any schedule, use the basic clause with 
Alternate I.
    (b) The provision at 252.247-7009, Award.
    (c) In solicitations and resulting contracts, the schedules 
contained in DoD 4500.34-R, Personal Property Traffic Management 
Regulation, as provided by the installation personal property shipping 
office.
    (1) When there is no requirement for an item or subitem in a 
schedule, indicate that item or subitem number, in its proper numerical 
sequence, and add the statement ``No Requirement.''
    (2) Within Schedules I (Outbound) and II (Inbound), item numbers are 
reserved to permit inclusion of additional items as required by local 
conditions.
    (3) Overseas activities, except those in Alaska and Hawaii, may 
modify the schedules when necessary to conform with local trade 
practices, laws, and regulations.
    (4) All generic terminology, schedule, and item numbers in proper 
sequence shall follow those contained in the basic format.
    (5) When it is in the Government's best interest to have both 
outbound and inbound services within a given area of performance 
furnished by the same contractor, modify the schedule format to combine 
both services in a single schedule. However, items shall follow the same 
sequential order as in the basic format.
    (6) Process any modification of schedule format, other than those 
authorized in paragraphs (c) (1) through (5) of this subsection, as a 
request for deviation through MTMC area commands/field offices to HQ, 
MTMC.
    (d) The clause at 252.247-7010, Scope of Contract.
    (e) The clause at 252.247-7011, Period of Contract. When the period 
of performance is less than a calendar year, modify the clause to 
indicate the beginning and ending dates. However, the contract period 
shall not end later than December 31 of the year in which the contract 
is awarded.
    (f) In addition to designating each ordering activity, as required 
by the clause at FAR 52.216-18, Ordering, identify by name or position 
title the individuals authorized to place orders for each activity. When 
provisions are made for placing oral orders in accordance with FAR 
16.506(b), document the oral orders in accordance with departmental/
agency instructions.
    (g) The clause at 252.247-7012, Ordering Limitation.
    (h) The clause at 252.247-7013, Contract Areas of Performance.
    (i) The clause at 252.247-7014, Demurrage.
    (j) When using the clause at FAR 52.216-21, Requirements, see 
216.505(d) which prescribes use of Alternate I at 252.247-7015.
    (k) The clause at 252.247-7016, Contractor Liability for Loss and 
Damage.
    (l) The clause at 252.247-7017, Erroneous Shipments.
    (m) The clause at 252.247-7018, Subcontracting.
    (n) The clause at 252.247-7019, Drayage.

[[Page 382]]

    (o) The clause at 252.247-7020, Additional Services.
    (p) The clauses at FAR 52.247-2, Permits, Authorities, or 
Franchises; FAR 52.247-8, Estimated Weights or Quantities Not 
Guaranteed; FAR 52.247-13, Accessorial Services--Moving Contracts; and 
FAR 52.247-17, Charges.



            Subpart 247.3--Transportation in Supply Contracts



247.305  Solicitation provisions, contract clauses, and transportation factors.



247.305-10  Packing, marking, and consignment instructions.

    (b) Consignment instructions shall include, as a minimum--
    (i) The clear text and coded MILSTRIP data as follows--
    (A) Consignee code and clear text identification of consignee and 
destination as published in--
    (1) DoD 4000.25-6-M, Department of Defense Activity Address 
Directory (DoDAAD);
    (2) DoD 4000.25-8-M, Military Assistance Program Address Directory 
(MAPAD);
    (3) Commercial and Government Entity (CAGE) Handbook H4/H8; or
    (4) Transportation Control and Movement Document.
    Reporting procedures and instructions shall comply with DoD 
Regulation 4500.32-R, MILSTAMP.
    (B) Project code, when applicable;
    (C) Transportation priority;
    (D) Required delivery date; and
    (E) Coded MILSTRIP document number, demand/suffix code, a 
supplementary address and signal code.
    (ii) Non-MILSTRIP shipments shall include data similar to paragraph 
(b)(i) (A) through (D) of this subsection and the applicable portion of 
paragraph (b)(i)(E) with the notation ``Non-MILSTRIP.''
    (iii) In amended shipping instructions include, in addition to the 
data requirements of paragraphs (b)(i) (A) through (E) of this 
subsection, the following, when appropriate--
    (A) Name of the activity originally designated, from which the 
stated quantities are to be deducted; and
    (B) Any other features of the amended instructions not contained in 
the basic contract.
    (iv) If a contract is assigned for any contract administration 
function listed in FAR subpart 42.3, to any office listed in DoD 4105.4, 
DoD Directory of Contract Administration Services Components, then 
include in instructions the--
    (A) Modification serial number; and, if a new line item is created 
by the issuance of shipping instructions;
    (B) New line item number; and
    (C) Existing line item number, if affected.
    (v) For petroleum, oil and lubricant products, instructions for 
diversions need not include the modification serial number and new line 
item number, when the instructions are--
    (A) For diversions overseas to new destinations;
    (B) Issued by an office other than that issuing the contract or 
delivery order; and
    (C) Issued by telephone, teletype, or telegram.



247.305-70  Returnable containers other than cylinders.

    Use the clause at 252.247-7021, Returnable Containers Other Than 
Cylinders, in solicitations and contracts for supplies involving 
contractor-furnished returnable reels, spools, drums, carboys, liquid 
petroleum gas containers, or other returnable containers if the 
contractor is to retain title to the containers.
[60 FR 29501, June 5, 1995]



247.370  Use of Standard Form 30 for consignment instructions.

    When complete consignment instructions are not known initially, use 
the Standard Form 30, Amendment of Solicitation/Modification of 
Contract, to issue or amend consignment instructions, and when 
necessary, to confirm consignment instructions issued by telephone, 
teletype, or telegram.
    (a) When using the SF 30 to confirm delivery instructions--
    (1) Stamp or mark ``CONFIRMATION'' in block letters on the form, and 
specify in detail those instructions being confirmed.

[[Page 383]]

    (2) Do not change the instructions being confirmed.
    (b) Process the confirming SF 30 as follows--
    (1) For contracts assigned for any contract administration function 
listed in subpart 247.3 to any office listed in DoD 4105.4, DoD 
Directory of Contract Administration Services Components, within five 
working days;
    (2) For diversions of petroleum, oil, and lubricant products 
overseas to new destinations, within 30 days of instructions being 
confirmed; and
    (3) Other contracts--
    (i) Telephone--within five working days; and
    (ii) Teletype or telegraph--consolidate on a monthly basis.



247.371  DD Form 1384, Transportation Control and Movement Document.

    Reporting procedures and instructions for this form will be in 
compliance with DoD Regulation 4500.32-R, MILSTAMP.



247.372  DD Form 1653, Transportation Data for Solicitations.

    (a) The transportation specialist prepares the DD Form 1653 at the 
request of the contracting officer. The completed form will contain 
recommendations concerning f.o.b. terms best suited for a particular 
acquisition, and other suggested transportation provisions for inclusion 
in the solicitation.
    (b) When appropriate, the DD Form 1653 will also include information 
on combined port handling and transportation charges for inclusion in 
the solicitation in connection with export shipments.



247.373  DD Form 1654, Evaluation of Transportation Cost Factors.

    Contracting personnel may use the DD Form 1654 to furnish 
information to the transportation office for development of cost factors 
for use by the contracting officer in the evaluation of f.o.b. origin 
offers.



        Subpart 247.5--Ocean Transportation by U.S.-Flag Vessels



247.570  Scope.

    This subpart--
    (a) Implements the Cargo Preference Act of 1904, 10 U.S.C. 2631, 
which applies to the ocean transportation of cargo owned by, or destined 
for use by, the DoD.
    (b) Does not specifically implement the Cargo Preference Act of 
1954, 46 U.S.C. 1241(b). The 1954 Act is applicable to the DoD, but 
DFARS coverage is not required because compliance with the 1904 Act 
historically has resulted in the DoD exceeding the 1954 Act's 
requirements.
    (c) Is an approved class deviation from FAR subpart 47.5 in its 
entirety (but see 247.571(c)).



247.571  Policy.

    (a) DoD contractors shall transport supplies, as defined in the 
clause at 252.247-7023, Transportation of Supplies by Sea, exclusively 
on U.S.-flag vessels unless--
    (1) Those vessels are not available, and notices are given and 
approvals received in accordance with this subpart;
    (2) The Secretary of the Navy determines that the freight charged is 
excessive or unreasonable; or
    (3) The contracting officer finds that the charges to the Government 
are higher than charges to private persons for the transportation of 
like goods.
    (b) Contracts shall provide for the use of Government-owned vessels 
when security classifications prohibit the use of other than Government-
owned vessels.
    (c)(1) Any vessel used under a time charter contract for the 
transportation of supplies shall have any reflagging or repair work, as 
defined in the clause at 252.247-7205, Reflagging or Repair Work, 
performed in the United States or its territories, if the reflagging or 
repair work is performed--
    (i) On a vessel for which the contractor submitted an offer in 
response to the solicitation for the contract; and
    (ii) Prior to acceptance of the vessel by the Government.
    (2) The Secretary of Defense may waive this requirement if the 
Secretary determines that such waiver is critical to the national 
security of the United States.
    (d) The Cargo Preference Act of 1904 does not apply to ocean 
transportation of--

[[Page 384]]

    (1) Products obtained for contributions to foreign assistance 
programs; or
    (2) Products owned by agencies other than the DoD. In these cases, 
FAR subpart 47.5 applies.
[56 FR 36466, July 31, 1991, as amended at 59 FR 10580, Mar. 7, 1994; 60 
FR 29501, June 5, 1995]



247.572  Procedures.



247.572-1  Ocean transportation incidental to a contract for supplies, services, or construction.

    (a) This subsection applies when ocean transportation is not the 
purpose of the contract. However, effective May 1, 1996, this subsection 
does not apply to subcontracts for the acquisition of commercial items 
or commercial components (see 212.504(a)(xxii)).
    (b) The contracting officer shall obtain assistance from the 
cognizant transportation activity (see 247.105), in developing--
    (1) The Government estimate for transportation costs, irrespective 
of whether freight will be paid directly by the Government;
    (2) Shipping instructions and delivery terms for inclusion in 
solicitations and contracts that may involve transportation of supplies 
by sea.
    (c) The contracting officer shall ask each offeror whether it will 
transport supplies by sea if awarded the contract (see 247.573(a)). Even 
if the successful offeror responds that it does not anticipate sea 
transport of supplies, it may discover during contract performance that 
ocean transportation is required. In that event, the Act will apply to 
the contract, and it must--
    (1) Notify the Government that it now intends to use ocean 
transportation;
    (2) Use U.S.-flag vessels unless certain conditions exist (see 
247.571(a)); and
    (3) Comply with the other requirements of the clause at 252.247-
7023, Transportation of Supplies by Sea.
    (d) When the contracting officer is notified that the contractor or 
subcontractor considers that--
    (1) No U.S.-flag vessels are available, the contracting officer 
shall request confirmation of the nonavailability from the Director, 
Office of Contracts and Business Management, Military Sealift Command 
(MSC).
    (2) The freight charges to the Government, the contractor or any 
subcontractor, are higher than charges for transportation of like goods 
to private persons, the contracting officer may approve any request for 
a waiver of the requirement to ship on U.S.-flag vessels for a 
particular shipment.
    (i) Prior to granting a waiver, the contracting officer shall 
request advice, oral or written, from the Commander, MSC.
    (ii) In advising the contracting officer whether to grant the 
waiver, the Commander, MSC, shall consider, as appropriate, evidence 
from--
    (A) Published tariffs;
    (B) Industry publications;
    (C) The Maritime Administration; and
    (D) Any other available sources.
    (3) The freight charged by U.S.-flag carriers is considered 
excessive or otherwise unreasonable, the contracting officer shall 
forward a report to the Commander, MSC, through the head of the 
contracting activity, and the Director, Office of Contracts and Business 
Management, MSC.
    (i) The report shall be in determination and finding format, and--
    (A) Take into consideration that the 1904 Act is, in part, a subsidy 
of the U.S.-flag commercial shipping industry that recognizes that lower 
prices may be available from foreign shippers;
    (B) Consider, accordingly, not only excessive profits to the vessel 
owner, if ascertainable, but also excessive costs (i.e., costs beyond 
the economic penalty normally incurred by excluding foreign competition) 
resulting from the use of U.S.-flag vessels in extraordinarily 
inefficient circumstances;
    (C) Include, as appropriate--
    (1) An analysis of whether the cost is excessive, taking into 
account factors such as the differential between freight charges by the 
U.S.-flag carrier and an estimate of what foreign-flag carriers would 
charge based upon a price analysis;
    (2) A comparison of U.S.-flag rates charged on comparable routes;
    (3) Efficiency of operation regardless of rate differential (i.e., 
suitability of

[[Page 385]]

the vessel for the required transportation in terms of cargo 
requirements/vessel capacity; the commercial reasonableness of vessel 
positioning required, etc.); and
    (4) Any other relevant economic and financial considerations.
    (D) Consider that the fact that it would be less expensive to use a 
foreign-flag vessel is not a sufficient basis, on its own, to determine 
that the freight rate proposed by the U.S.-flag carrier is excessive or 
otherwise unreasonable. However, such a differential may indicate a need 
for further review.
    (ii) If the Commander, MSC, concurs with the contracting officer, 
the Commander will forward the report to the Secretary of the Navy, via 
ASN(RDA)(PP), for a determination as to whether the freight charges are 
excessive or otherwise unreasonable.
[56 FR 36466, July 31, 1991, as amended at 60 FR 61599, Nov. 30, 1995]



247.572-2  Direct purchase of ocean transportation services.

    (a) This subsection applies when ocean transportation is the 
principal purpose of the contract, including--
    (1) Time charters;
    (2) Voyage charters;
    (3) Contracts of affreightment;
    (4) Dedicated contractor contracts of affreightment;
    (5) Ocean bills of lading; and
    (6) Subcontracts under Government contracts or agreements for ocean 
transportation services.
    (b) Coordinate these acquisitions, as appropriate, with the MSC in 
accordance with DoDD 5160.10, Single Manager Assignment for Ocean 
Transportation.
    (c) The Commander, MSC, is authorized to make any determination as 
to the availability of U.S.-flag vessels, in order to ensure the proper 
utilization of Government and private U.S. vessels.
    (d) All solicitations for ocean transportation services for supplies 
owned by the military departments shall provide a preference for U.S.-
flag vessels as an evaluation factor.
    (e) The contracting officer shall not award a contract of the type 
described in paragraph (a) of this subsection for a foreign-flag vessel 
unless--
    (1) The contracting officer determines that no U.S.-flag vessels are 
available, and obtains approval of the Commander, MSC; or
    (2) The contracting officer determines that the freight charges 
proposed by U.S.-flag vessels to the Government are higher than charges 
to private persons for transportation of like goods, and obtains the 
approval of the Commander; MSC; or
    (3) The Secretary of the Navy determines (see paragraph (f) of this 
subsection) that the freight charges for U.S.-flag vessels are excessive 
or otherwise unreasonable.
    (f) When the contracting officer concludes, based solely on economic 
considerations, that the charge offered for a U.S.-flag vessel is 
excessive or otherwise unreasonable, the contracting officer will send a 
report through the head of the contracting activity to the Commander, 
MSC.
    (1) The fact that it would be less expensive to use a foreign-flag 
vessel is an insufficient basis, on its own, to determine that the 
freight rate proposed by the U.S.-flag carrier is excessive or otherwise 
unreasonable. However, such a differential may indicate a need for 
further review.
    (2) The Commander, MSC, will forward the report, if in agreement 
with the contracting officer, to the Secretary of the Navy for a 
determination.
    (3) The report shall be in determination and finding format; take 
into consideration the factors in 247.572-1(d)(3); and include, as 
appropriate--
    (i) An analysis of the carrier's cost in accordance with FAR subpart 
15.8, or profit in accordance with DFARS subpart 215.9. The costs or 
profit should not be so high as to make it unreasonable to apply the 
preference for U.S.-flag vessels;
    (ii) A description of efforts taken pursuant to FAR 15.803(d), to 
negotiate a reasonable price. For the purpose of FAR 15.803(d), this 
report is the referral to higher authority; and
    (iii) An analysis of whether the cost is excessive (i.e., cost 
beyond the economic penalty normally incurred by excluding foreign 
competition), taking into consideration such factors as--
    (A) The differential between freight charges by the U.S.-flag 
carrier and an

[[Page 386]]

estimate of what foreign-flag carriers would charge based upon a price 
analysis;
    (B) A comparison of rates charged by other U.S.-flag carriers on 
comparable routes;
    (C) Efficiency of operation regardless of rate differential (i.e., 
suitability of the vessel capacity/cargo requirements; the commercial 
reasonableness of the vessel positioning required, etc.); and
    (D) Any other relevant economic and financial considerations 
affecting the Government.
[56 FR 36466, July 31, 1991, as amended at 60 FR 61599, Nov. 30, 1995]



247.573  Solicitation provision and contract clauses.

    (a) Use the provision at 252.247-7022, Representation of Extent of 
Transportation by Sea, in full text, in all solicitations except--
    (1) Those for direct purchase of ocean transportation services; or
    (2) Those with an anticipated value below the small purchase 
limitation at FAR 13.000.
    (b) Use the clause at 252.247-7023, Transportation of Supplies by 
Sea, in all solicitations and resultant contracts, in full text, 
except--
    (1) Those for direct purchase of ocean transportation services; or
    (2) Those with an anticipated value below the small purchase 
limitation at FAR 13.000.
    (c) Use the clause at 252.247-7024, Notification of Transportation 
of Supplies by Sea, in full text, in all contracts for which the offeror 
made a negative response to the inquiry in the provision at 252.247-
7022, Representation of Extent of Transportation by Sea.
    (d) Use the clause at 252.247-7025, Reflagging or Repair Work, in 
all time charter solicitations and contracts for the use of a vessel for 
the transportation of supplies, unless a waiver has been granted in 
accordance with 247.571(c).
[56 FR 36466, July 31, 1991, as amended at 59 FR 10580, Mar. 7, 1994; 60 
FR 29501, June 5, 1995]



PART 248--VALUE ENGINEERING--Table of Contents




    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

                     Subpart 248.2--Contract Clauses



248.270  Supplemental clause.

    When one of the clauses prescribed by FAR subpart 48.2 is used and 
the contracting officer wants value engineering change proposals 
submitted in the format prescribed by MIL-STD-973, use the clause at 
252.248-7000, Preparation of Value Engineering Change Proposals.
[56 FR 36471, July 31, 1991, as amended at 59 FR 27674, May 27, 1994]



PART 249--TERMINATION OF CONTRACTS--Table of Contents




Sec.

                    Subpart 249.1--General Principles

249.105  Duties of termination contracting officer after issuance of 
          notice of termination.
249.105-1  Termination status report.
249.105-2  Release of excess funds.
249.108  Settlement of subcontract settlement proposals.
249.108-4  Authorization for subcontract settlements without approval or 
          ratification.
249.109  Settlement agreements.
249.109-7  Settlement by determination.
249.110  Negotiation memorandum.

               Subpart 249.5--Contract Termination Clauses

249.501  General.
249.501-70  Special termination costs.

            Subpart 249.70--Special Termination Requirements

249.7000  Terminated contracts with Canadian Commercial Corporation.
249.7001  Congressional notification on significant contract 
          terminations.
249.7002  [Reserved]
249.7003  Notification of anticipated contract terminations or 
          reductions.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36471, July 31, 1991, unless otherwise noted.

[[Page 387]]



                   Subpart 249.1--General Principles.



249.105  Duties of termination contracting officer after issuance of notice of termination.



249.105-1  Termination status report.

    When the contract administration office receives a termination 
notice, it will under Report Control Symbol DD-ACQ (AR) 1411--
    (i) Prepare a DD Form 1598, Contract Termination Status Report;
    (ii) Within 30 days, send one copy to the purchasing office and one 
copy to the headquarters office to which the contract administration 
office is directly responsible;
    (iii) Continue reporting semiannually to cover the 6 month periods 
ending March and September. The semiannual reports must be submitted 
within 30 days after the end of the reporting period; and
    (iv) Submit a final report within 30 days after closing the 
termination case.
[56 FR 36471, July 31, 1991, as amended at 59 FR 27674, May 27, 1994]



249.105-2  Release of excess funds.

    The DD Form 1598, Contract Termination Status Report, may be used to 
recommend the release of excess funds. The final recommendation to 
release excess funds should include the appropriations and allocated 
amounts.



249.108  Settlement of subcontract settlement proposals.



249.108-4  Authorization for subcontract settlements without approval or ratification.

    (a)(1)(ii) Industrial plant equipment included in the inventory--
    (1) Is subject to the screening requirements in FAR 45.608.
    (2) Shall not be disposed of until screening is completed when the 
cost of that equipment is used in determining the amount of the claim.



249.109  Settlement agreements.



249.109-7  Settlement by determination.

    (a)(i) Use a Standard Form 30 (SF 30), Amendment of Solicitation/
Modification of Contract, to settle a convenience termination by 
determination--
    (A) When the contractor has lost its right of appeal because it 
failed to submit a timely settlement proposal; and
    (B) To confirm the determination when the contractor does not appeal 
the termination contracting officer's decision.
    (ii) The effective date of the SF 30 shall be the same as the date 
of the letter of determination. Do not assign a supplementary 
procurement instrument number to the letter of determination. Send a 
copy of the SF 30 to the contractor by certified mail return receipt 
requested.



249.110  Negotiation memorandum.

    (a)(i) Fixed price contracts. Use the format in Table 49-1, 
Settlement Memorandum-Fixed Price Contracts, for the termination 
contracting officer's settlement memorandum for fixed price contracts 
terminated for the convenience of the Government. Encourage contractors 
and subcontractors to use this format, appropriately modified, for 
subcontract settlements submitted for review and approval.
    (ii) Cost-reimbursement contracts. Use Part I of the format in Table 
49-1 and Part II of the format in Table 49-2, Settlement Memorandum for 
Cost-Reimbursement Contracts, for the termination contracting officer's 
settlement memorandum for cost-reimbursement contracts:

[[Page 388]]



         Table 49-1--Settlement Memorandum-Fixed Price Contracts        
                                                                        
                                                                        
                       Part I--General Information                      
                                                                        
1. Identification. (Identify memorandum as to its purpose and content.) 
  a. Name and address of the contractor. Comment on any pertinent       
   affiliation between prime and subcontractors relative to the overall 
   settlement.                                                          
  b. Names and titles of both contractor and Government personnel who   
   participated in the negotiation.                                     
2. Description of terminated contract.                                  
  a. Date of contract and contract number.                              
  b. Type of contract (e.g., fixed price, fixed price incentive).       
  c. General description of contract items.                             
  d. Total contract price.                                              
  e. Furnish reference to the contract termination clauses (cite FAR/   
   DFARS designation or other special provisions).                      
3. Termination notice.                                                  
  a. Reference termination notice and state effective date of           
   termination.                                                         
  b. Scope and nature of termination (complete or partial), items       
   terminated, unit price and total price of items terminated.          
  c. State whether termination notice was amended, and explain any      
   amendment.                                                           
  d. State whether contractor stopped work on effective termination     
   date. If not, furnish details.                                       
  e. State whether the contractor promptly terminated subcontracts.     
  f. Statement as to the diversion of common items and return of goods  
   to suppliers, if any.                                                
  g. Furnish information as to contract performance and timeliness of   
   deliveries by the contractor.                                        
4. Contractor's settlement proposal.                                    
  a. Date and amount. Indicate date and location where claim was filed. 
   State gross amount of claim. (If interim settlement proposals were   
   filed, furnished information for each claim.)                        
  b. Basis of claim. State whether claim was filed on inventory, total  
   cost or other basis. Explain rationale for approval when claim is    
   filed on other than inventory basis.                                 
  c. Examination of proposal. State type of reviews made and by whom    
   (audit, engineering, legal, or other).                               
                                                                        
    Part II--Summary of Contractor's Claim and Negotiated Settlement    
                                                                        
Prepare a summary substantially as follows:                             


                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                                                                                        TCO     
          Item claimed              Contractor's        Dollars          Costs        Unresolved     negotiated 
                                      proposal         accepted       questioned        items          amount   
----------------------------------------------------------------------------------------------------------------
1. Contractor's costs as set                                                                                    
 forth on settlement proposal.                                                                                  
 Metals, raw materials, etc..                                                                                   
      Total.....................                                                                                
2. Profit.......................                                                                                
3. Settlement expenses..........                                                                                
4. Total........................                                                                                
5. Settlement with subs.........                                                                                
6. Acceptable finished product..                                                                                
7. Gross Total..................                                                                                
8. Disposal and other credits...                                                                                
9. Net settlement...............                                                                                
10. Partial, progress & advance                                                                                 
 payments.                                                                                                      
11. Net payments requested......                                                                                

[[Page 389]]

                                                                                                                
----------------------------------------------------------------------------------------------------------------


                                                                        
                                                                        
                                                                         
                   Part III--Discussion of Settlement                   
1. Contractor's cost.                                                   
  a. If the settlement was negotiated on the basis of individual items, 
   specify the factors and consideration for each item.                 
  b. In the case of a lump sum settlement, comment on the general basis 
   for and major factors concerning each element of cost and profit     
   included.                                                            
  c. Comment on any important adjustments made to costs claimed or any  
   significant amounts in relation to the total claim.                  
  d. If a partial termination is involved, state whether the contractor 
   has requested an equitable adjustment in the price of the continued  
   portion of the contract.                                             
  e. Comment on any unadjusted contractual changes which are included in
   the settlement.                                                      
  f. Comment on whether or not a loss would have been incurred and      
   explain adjustment for loss, if any.                                 
  g. Furnish other information believed helpful to any reviewing        
   authority in understanding the recommended settlement.               
2. Profit. Explain the basis and factors considered in arriving at a    
 fair profit.                                                           
3. Settlement expenses. Comment on and summarize those expenses not     
 included in the audit review.                                          
4. Subcontractor's settlements. Include the number of no costs          
 settlements, settlements concluded by the contractor under delegation  
 of authority and those approved by the termination contracting officer,
 as well as the net amount of each.                                     
5. Partial payments. Furnish the total amount of partial payments, if   
 any.                                                                   
6. Progress or advance payments. Furnish the total of unliquidated      
 amounts, if any.                                                       
7. Claims of the Government against the contractor included in          
 settlement agreement reservations. List all outstanding claims, if any,
 which the Government has against the contractor in connection with the 
 terminated contract or terminated portion of the contract.             
8. Assignments. List any assignments, giving name and address of        
 assignee.                                                              
9. Disposal credits. Furnish information as to applicable disposal      
 credits and give dollar amounts of all disposal credits.               
10. Plant clearance. State whether plant clearance action has been      
 completed and all inventory sold, retained, or otherwise properly      
 disposed of in accordance with applicable plant clearance regulations. 
 Comment on any unusual matters pertaining to plant clearances. Attach  
 consolidated closing plant clearance report.                           
11. Government property. State whether all Government property has been 
 accounted for.                                                         
12. Special tooling. If involved, furnish comment on disposition.       
13. Summary of settlement. Summarize the settlement in tabular form     
 substantially as follows:                                              
                                                                        
           Tabular Summary for Complete or Partial Termination          
                                                                        
                                                                        


                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                                             Amount claimed                Amount allowed       
----------------------------------------------------------------------------------------------------------------
Prime contractors charges (before disposal credits).                                                            
Plus: Subcontractor charges (after disposal credits)                                                            
Gross settlement:                                                                                               
    Less: disposal credits--Prime...................                                                            
Net settlement--Less:                                                                                           
    Prior payment credits (this settlement).........                                                            
    Previous partial settlements....................                                                            
    Other credits or deductions.....................                                                            
Net payment:                                                                                                    
    Total contract price (complete termination).....                                                            
    Contract Price of Items Terminated (for partial                                                             
     termination)--Less:                                                                                        
      Total payments to date........................                                                            
      Net payment from this settlement..............                                                            
      Fund reserved for reservations................                                                            
Reduction in contract price.........................                                                            
----------------------------------------------------------------------------------------------------------------


                                                                        
                                                                        
                                                                         
14. Exclusions. Describe any proposed reservation of rights to the      
 Government or to the contractor.                                       
15. Include statement that the settlement is fair and reasonable for the
 Government and the contractor. The contracting officer shall sign and  
 date the memorandum.                                                   
                                                                        
(End of memorandum)                                                     

[[Page 390]]

                                                                        
                                                                        


   Table 49-2--Settlement Memorandum for Cost-Reimbursement Contracts   
                                                                        
                                                                        
                     Part II--Summary of Settlement                     
                                                                        
1. Summary. Summarize the proposed settlement in tabular form           
 substantially as shown in Tables 49-3 and 49-4. Partial settlements may
 be summarized on Table 49-4.                                           
2. Comments. Explain tabular summaries.                                 
  a. Summary of final settlement (see Table 49-3).                      
    (1) Explain why the auditor's final report was not available for    
     consideration, if applicable.                                      
    (2) Explain how the fixed fee was adjusted. Identify basis used such
     as percentage of completion. Include a description of factors      
     considered and how they were considered. Include any tabular       
     summaries and breakdowns deemed helpful to an understanding of the 
     process. Factors which may be given consideration are outlined in  
     FAR 49.305.                                                        
    (3) Briefly identify matters included in liability for property and 
     other charges against the contractor arising from the contract.    
    (4) Identify reservations included in the settlement that are other 
     than standard reservations required by regulations and which are   
     concerned with pending claims and refunds.                         
    (5) Explain substantial or otherwise important adjustments made in  
     cost figures submitted by the contractor in arriving at the        
     proposed settlement.                                               
    (6) If unreimbursed costs were settled on a lump sum basis, explain 
     the general basis for and the major factors considered in arriving 
     at this settlement.                                                
    (7) Comment on any unusual items of cost included in the claim and  
     on any phase of cost allocation requiring particular attention and 
     not covered above.                                                 
    (8) If auditor's recommendations for nonacceptance were not         
     followed, explain briefly the main reasons why such recommendations
     were not followed.                                                 
    (9) On items recommended for further consideration by the auditor,  
     explain, in general, the basis for the action taken.               
    (10) If any cost previously disallowed by a contracting officer is  
     included in the proposed settlement, identify and explain the      
     reason for inclusion of such costs.                                
    (11) Show number and amounts of settlements with subcontractors.    
    (12) Use the following summary where settlement includes costs and  
     fixed fee in a complete termination:                               


                                                                                                                
                                                                                                                
Gross settlement..........................................................  .................          $________
    Less: Disposal credits................................................  .................           ________
Net settlement............................................................  .................           ________
    Less: Prior payments..................................................           ________                   
    Other credits or deductions...........................................           ________                   
      Total...............................................................  .................           ________
Net payment...............................................................  .................          $________
      Total contract estimated cost plus fixed fee........................                              ________
    Less: Net settlement..................................................           ________                   
    Estimated reserve for exclusions......................................           ________                   
Final contract price:                                                                                           
    (Consisting of $______ for reimbursement of costs and $________ for                                         
     adjusted fixed fee)..................................................           ________           ________
Reduction in contract price (credit)......................................                              ________
----------------------------------------------------------------------------------------------------------------


                                                                        
                                                                        
    (13) Plant clearance. Indicate dollar value of termination          
     inventory and state whether plant clearance has been               
     completed. Attach consolidated plant clearance report (SF          
     1424, Inventory Disposal Report).                                  
    (14) Government property. State whether all Government              
     property has been accounted for.                                   
    (15) Include a statement that the settlement is fair and            
     reasonable to the Government and the contractor. The               
     contracting officer shall sign and date the memorandum.            
                                                                        
(End of memorandum)                                                     
------------------------------------------------------------------------


                    Table 49-3--Summary of Settlement                   
------------------------------------------------------------------------
                                                 Amount        Amount   
                                                 claimed       allowed  
------------------------------------------------------------------------
1. Previous reimbursed costs--                $             $           
 Prime and Subs.                                                        
2. Previous unreimbursed costs                ________      ________    
3. Total cost settlement......                $             $           
4. Previous fees paid--Prime..                $             $           
5. Previous fees unpaid--Prime                ________      ________    
6. Total fee settlement.......                $             $           
7. Gross settlement...........                ________      ________    
                                              $________     $________   

[[Page 391]]

                                                                        
                                              ________      ________    
    Less: Deductions not                                                
     reflected in Items 1-7.                                            
      a. Disposal credits.....  $________                               
      b. Other charges against  $________                               
       contractor arising from                                          
       contract.                                                        
8. Net settlement.............                              $           
    Less: Prior payment                                     ________    
     credits.                                                           
9. Net payment................                              $           
10. Recapitulation of previous                                          
 settlements (insert number of                                          
 previous partial settlements                                           
 effected on account of this                                            
 particular termination):                                               
    Aggregate gross amount of                               $________   
     previous settlements.                                              
    Aggregate net amount of                                 $________   
     previous partial                                                   
     settlements.                                                       
    Aggregate net payment                                   $________   
     provided in previous                                               
     partial settlements.                                               
    Aggregate amount allowed                                $________   
     for prime contractor                                               
     acquired property taken                                            
     over by the Government in                                          
     connection with previous                                           
     partial settlements.                                               
------------------------------------------------------------------------


                              Table 49-4--Unreimbursed Costs Submitted on SF 1437 *                             
----------------------------------------------------------------------------------------------------------------
                                  Amounts claimed by         Auditor's recommendation                           
             Costs                   contractor's    ----------------------------------------  TCO's computation
                                       proposal         Cost questioned    Unresolved items                     
----------------------------------------------------------------------------------------------------------------
1. Direct material.............                                                                                 
2. Direct labor................                                                                                 
3. Indirect factory expense....                                                                                 
4. Dies, jigs, fixtures and                                                                                     
 special tools.                                                                                                 
5. Other costs.................                                                                                 
6. General and administrative                                                                                   
 expenses.                                                                                                      
7. Fee.........................                                                                                 
8. Settlement expense..........                                                                                 
9. Settlement with subs........                                                                                 
10. Total costs (Items 1-9)....                                                                                 
----------------------------------------------------------------------------------------------------------------
* Expand the format to include recommendations of technical personnel as required.                              

[56 FR 36471, July 31, 1991, as amended at 62 FR 34128, June 24, 1997]



               Subpart 249.5--Contract Termination Clauses



249.501  General.



249.501-70  Special termination costs.

    (a) The clause at 252.249-7000, Special Termination Costs, may be 
used in an incrementally funded contract when its use is approved by the 
agency head.
    (b) The clause is authorized when--
    (1) The contract term is 2 years or more;
    (2) The contract is estimated to require--
    (i) Total RDT&E financing in excess of $25 million; or
    (ii) Total production investment in excess of $100 million; and
    (3) Adequate funds are available to cover the contingent reserve 
liability for special termination costs.
    (c) The contractor and the contracting officer must agree upon an 
amount that represents their best estimate of the total special 
termination costs to which the contractor would be entitled in the event 
of termination of the contract. Insert this amount in paragraph (c) of 
the clause.
    (d)(1) Consider substituting an alternate paragraph (c) for 
paragraph (c) of the basic clause when--
    (i) The contract covers an unusually long performance period; or
    (ii) The contractor's cost risk associated with contingent special 
termination costs is expected to fluctuate extensively over the period 
of the contract.
    (2) The alternate paragraph (c) should provide for periodic 
negotiation and adjustment of the amount reserved for special 
termination costs. Occasions for periodic adjustment may include--
    (i) The Government's incremental assignment of funds to the 
contract;
    (ii) The time when certain performance milestones are accomplished 
by the contractor; or

[[Page 392]]

    (iii) Other specific time periods agreed upon by the contracting 
officer and the contractor.



            Subpart 249.70--Special Termination Requirements



249.7000  Terminated contracts with Canadian Commercial Corporation.

    (a) Terminate contracts with the Canadian Commercial Corporation in 
accordance with--
    (1) The Letter of Agreement (LOA) between the Department of Defence 
Production (Canada) and the U.S. DoD, ``Canadian Agreement'' (for a copy 
of the LOA or for questions on its currency, contact the Foreign 
Contracting Directorate, Office of the Director of Defense Procurement, 
(703) 697-9351, DSN 227-9351));
    (2) Policies in the Canadian Agreement and part 249; and
    (3) The Manual of Procedure on Termination of Contracts, Department 
of Supply and Services (Canada).
    (b) Contracting officers shall ensure that the Canadian Commercial 
Corporation submits termination settlement proposals in the format 
prescribed in FAR 49.602 and that they contain the amount of settlements 
with subcontractors. The termination contracting officer (TCO) shall 
prepare an appropriate settlement agreement. (See FAR 49.603.) The 
letter transmitting a settlement proposal must certify--
    (1) That disposition of inventory has been completed; and
    (2) That the Contracts Settlement Committee of the Supply and 
Services Canada (SSC) has approved settlements with Canadian 
subcontractors when the Manual of Procedure on Termination of Contracts, 
SSC, requires such approval.
    (c)(1) The Canadian Commercial Corporation will--
    (i) Settle all Canadian subcontractor termination claims under the 
Canadian Agreement; and
    (ii) Submit schedules listing serviceable and usable contractor 
inventory for screening to the TCO (see FAR 45.6).
    (2) After screening, the TCO must provide guidance to the Canadian 
Commercial Corporation for disposition of the contractor inventory.
    (3) Settlement of Canadian subcontractor claims are not subject to 
the approval and ratification of the TCO. However, when the proposed 
negotiated settlement exceeds the total contract price of the prime 
contract, the TCO shall obtain from the U.S. contracting officer prior 
to final settlement--
    (i) Ratification of the proposed settlement; and
    (ii) A contract modification increasing the contract price and 
obligating the additional funds.
    (d) The Canadian Commercial Corporation (CCC) should send all 
termination settlement proposals submitted by U.S. subcontractors and 
suppliers to the TCO, Defense Contract Management Area Operations, 
Ottawa, for settlement. The TCO will inform the CCC of the amount of the 
net settlement of U.S. subcontractors and suppliers so that this amount 
can be included in the CCC termination proposal. The Canadian Commercial 
Corporation is responsible for execution of the settlement agreement 
with these subcontractors.



249.7001  Congressional notification on significant contract terminations.

    (a) Congressional notification is required for any termination 
involving a reduction in employment of 100 or more contractor employees. 
Proposed terminations must be cleared through department/agency liaison 
offices before release of the termination notice, or any information on 
the proposed termination, to the contractor.
    (b) Department and agency liaison offices will coordinate timing of 
the congressional notification and public release of the information 
with release of the termination notice to the contractor. Department and 
agency liaison offices are--
    (1) Army--Chief, Legislative Liaison (SALL-SPA)
    (2) Navy--Chief of Legislative Affairs (OLA-N)
    (3) Air Force--SAF/AQC
    (4) Defense Advanced Research Projects Agency--CMO

[[Page 393]]

    (5) Defense Information Systems Agency--Contract Management Division 
(Code 260)
    (6) Defense Intelligence Agency--RSQ
    (7) Defense Logistics Agency--DLA-PP
    (8) Defense Mapping Agency--HQ DMA (AQ)
    (9) Defense Special Weapons Agency--Acquisition Management 
Directorate (AM)
    (10) National Security Agency/Central Security Service--Chief, 
Office of Contracting
    (11) On-Site Inspection Agency--Acquisition Management Office (AM)
    (12) Ballistic Missile Defense Organization--Director of Contracts 
(BMDO-DCT)
    (c) Request clearance to release information in accordance with 
departmental procedures as soon as possible after the decision to 
terminate is made. Until clearance has been obtained, treat this 
information as ``For Official Use Only'' unless the information is 
classified.
    (d) Include the following in the request for clearance--
    (1) Contract number, date, and type of contract;
    (2) Name of the company;
    (3) Nature of contract or end item;
    (4) The reason for the termination;
    (5) Contract price of the items terminated;
    (6) Total number of contractor employees involved, including the 
Government's estimate of the number who may be discharged;
    (7) Statement of anticipated impact on the company and the 
community;
    (8) The area labor category, whether the contractor is a large or 
small business, and any known impact on hard core disadvantaged 
employment programs;
    (9) Total number of subcontractors involved and the impact in this 
area; and
    (10) An unclassified draft of a suggested press release.
    (e) To minimize termination costs, liaison offices will act promptly 
on all requests for clearances and provide a response not later than two 
working days after receipt of the request.
    (f) This reporting requirement is assigned RCS:DD(I&L)(AR) 1412.
[56 FR 36471, July 31, 1991, as amended at 56 FR 67220, Dec. 30, 1991; 
59 FR 27674, May 27, 1994; 61 FR 50455, Sept. 26, 1996]



249.7002  [Reserved]



249.7003  Notification of anticipated contract terminations or reductions.

    (a) Section 1372 of the National Defense Authorization Act for 
Fiscal Year 1994 (Pub. L. 103-160) and Section 824 of the National 
Defense Authorization Act for Fiscal Year 1997 (Pub. L. 104-201) are 
intended to help establish benefit eligibility under the Job Training 
Partnership Act (29 U.S.C. 1661 and 1662) for employees of DoD 
contractors and subcontractors adversely affected by termination or 
substantial reductions in major defense programs.
    (b) Departments and agencies are responsible for establishing 
procedures to:
    (1) Identify which contracts (if any) under major defense programs 
will be terminated or substantially reduced as a result of the funding 
levels provided in an appropriations act.
    (2) Within 60 days of the enactment of such an act, provide notice 
of the anticipated termination of or substantial reduction in the 
funding of affected contracts--
    (i) Directly to the Secretary of Labor; and
    (ii) Through the contracting officer to each prime contractor.
    (c) Use the clause at 252.249-7002, Notification of Anticipated 
Contract Termination or Reduction, in all contracts under a major 
defense program.
[61 FR 64637, Dec. 6, 1996; 61 FR 66077, Dec. 16, 1996; 62 FR 49304, 
Sept. 19, 1997]



PART 250--EXTRAORDINARY CONTRACTUAL ACTIONS--Table of Contents




Sec.
250.001  Definitions.

                         Subpart 250.1--General

250.104  Reports.
250.105  Records.

[[Page 394]]

  Subpart 250.2--Delegation of and Limitations on Exercise of Authority

250.201  Delegation of authority.
250.201-70  Delegations.
250.202  Contract adjustment boards.

                   Subpart 250.3--Contract Adjustments

250.303  Contractor requests.
250.305  Processing cases.
250.305-70  Record of request.
250.305-71  Processing cases to contract adjustment boards.
250.305-72  Processing by the board.
250.306  Disposition.
250.306-70  Record of disposition.

                     Subpart 250.4--Residual Powers

250.403  Special procedures for unusually hazardous or nuclear risks.
250.403-70  Indemnification under contracts involving both research and 
          development and other work.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36475, July 31, 1991, unless otherwise noted.



250.001  Definitions.

    As used in this part,
    Secretarial level means--
    (1) An official at or above the level of an Assistant Secretary (or 
Deputy) of Defense or of the Army, Navy, or Air Force; and
    (2) A contract adjustment board established by the Secretary 
concerned.



                         Subpart 250.1--General



250.104  Reports.

    Prepare reports required by this section in accordance with DoDI 
4105.69, Miscellaneous Procurement Report. Department and agency 
supplements identify officials responsible for preparing and processing 
the reports required by this section.



250.105  Records.

    (1) Departments and agencies will--
    (i) Prepare a preliminary record when a request for a contract 
adjustment under FAR 50.3 is filed (see 250.305-70).
    (ii) Prepare a final record stating the disposition of the request 
(see 250.306-70).
    (iii) Designate the offices or officials responsible for preparing, 
submitting, and receiving all records required by this part 250. Records 
shall be maintained by the contract adjustment boards of the Army, Navy, 
and Air Force, respectively, and by the headquarters of the defense 
agencies.
    (2) A suggested format for the record is in Table 50-1, Record of 
Request for Adjustment. This format permits the information required for 
the preliminary and final records to be combined on one form.
    (3) The following instructions are provided for those items which 
are not self-explanatory:
    (i) Extent of performance as of date of request. State degree of 
completion of contract; e.g., 50 percent completed or performance not 
yet begun. If work is completed, state date of completion and whether 
final payment has been made.
    (ii) Award procedure. State whether contract was awarded under 
sealed bidding or negotiated procedures. Cite specific authority for 
using other than full and open competition, if applicable, e.g., 10 
U.S.C. 2304(c)(1).
    (iii) Type of contract. State type of contract (see FAR part 16); 
e.g., FFP (firm fixed-price).
    (iv) Category of case. State whether the request involves a 
modification without consideration, a mistake, or an informal 
commitment. If the case involves more than one category, identify both; 
list the most significant category first.
    (v) Amount or description of request. If the request is expressed in 
dollars, state the amount and whether it is an increase or decrease. If 
the request cannot be expressed in monetary terms, provide a brief 
description; e.g., ``Cancellation'' or ``Modification.'' Even if the 
adjustment is not easily expressed in terms of dollars, if the 
contractor has made an estimate in the request, that estimate should be 
stated.
    (vi) Action below Secretarial level. State the disposition of the 
case, the office that took the action and the date the action was taken. 
The disposition should be stated as ``Withdrawn,'' ``Denied,'' 
``Approved,'' or ``Forwarded.'' If the request was approved, in whole or 
in part, state the dollar amount or nature of the action (as explained 
in paragraph (v) of this section). The date should correspond with the 
date of the

[[Page 395]]

memorandum of decision or of the letter forwarding the request to the 
contract adjustment board or other deciding body.
    (vii) Action by contract adjustment board and date. State the 
disposition and date of disposition of the case by the contract 
adjustment board. Provide the same information as for paragraph (vi).
    (viii) Implementation and date. State the appropriate action; e.g., 
``Modification,'' ``New Contract,'' or ``Letter of Denial.''
[GRAPHIC] [TIFF OMITTED] TC01FE91.053


[[Page 396]]





  Subpart 250.2--Delegation of and Limitations on Exercise of Authority



250.201  Delegation of authority.

    (b) Authority under FAR subpart 50.2 to approve actions obligating 
$50,000 or less may not be delegated below the level of the head of the 
contracting activity; however, see FAR 50.201(d) for indemnification 
authority.
[56 FR 36475, July 31, 1991, as amended at 59 FR 27675, May 27, 1994]



250.201-70  Delegations.

    (a) Military Departments. The Departments of the Army, Navy and Air 
Force will specify delegations and levels of authority for actions under 
the Act and the Executive Order in departmental supplements.
    (b) Defense Agencies. Subject to the restrictions on delegations of 
authority in 250.201(b) and FAR 50.201, the directors of the defense 
agencies may exercise and redelegate the authority contained in the Act 
and the Executive Order. The agency supplements shall specify the 
delegations and levels of authority.
    (1) Requests to obligate the Government in excess of $50,000 must be 
submitted to the Under Secretary of Defense (Acquisition & Technology) 
(USDA&T)) for approval.
    (2) Requests for indemnification against unusually hazardous or 
nuclear risks must be submitted to the USD(A&T) for approval before 
using the indemnification clause at FAR 52.250-1, Indemnification Under 
Public Law 85-804.
    (c) Approvals. The service Secretary or agency director must approve 
any delegations in writing.
[56 FR 36475, July 31, 1991, as amended at 56 FR 67221, Dec. 30, 1991; 
60 FR 61600, Nov. 30, 1995]



250.202  Contract adjustment boards.

    The Departments of the Army, Navy, and Air Force each have a 
contract adjustment board. The board consists of a Chair and not less 
than two nor more than six other members, one of whom may be designated 
the Vice-Chair. A majority constitutes a quorum for any purpose and the 
concurring vote of a majority of the total board membership constitutes 
an action of the board. Alternates may be appointed to act in the 
absence of any member.



                   Subpart 250.3--Contract Adjustments



250.303  Contractor requests.

    Requests should be filed with the procuring contracting officer 
(PCO). If a request is filed with an administrative contracting officer 
(ACO), the ACO shall promptly forward it to the PCO for appropriate 
action. If filing with the PCO is impracticable, requests may be filed 
with the following addresses for forwarding to the cognizant PCO:

    (1) Office of the Secretary of Defense--Washington Headquarters 
Service, Attn: RE&F-AM.
    (2) Army--Forward to the head of the contracting activity listed in 
Part 202 that appears to be the cognizant office for the contract or 
commitment involved.
    (3) Navy--Assistant Secretary of the Navy (RD&A), Attn: Procurement 
Policy.
    (4) Air Force--Deputy Assistant Secretary (Contracting), Attn: SAF/
AQCX.
    (5) Defense Advanced Research Projects Agency--Director, CMO.
    (6) Defense Information Systems Agency--Attn: Code PA.
    (7) Defense Intelligence Agency--Assistant Deputy Director for 
Procurement, Attn: RSQ.
    (8) Defense Logistics Agency--The Commander of the Defense Supply 
Center involved.
    (9) Defense Mapping Agency--Director, DMA, Attn: AQ.
    (10) Defense Special Weapons Agency--Director, DSWA, Attn: AM.
    (11) National Security Agency--Director, NSA.
    (12) On-Site Inspection Agency--Director, OSIA, Attn: DSP.
    (13) Ballistic Missile Defense Organization--Director, BMDO.
[56 FR 36475, July 31, 1991, as amended at 56 FR 67221, Dec. 30, 1991; 
59 FR 27675, May 27, 1994; 61 FR 50455, Sept. 26, 1996]

[[Page 397]]



250.305  Processing cases.



250.305-70  Record of request.

    At the time the request is filed, the activity will prepare the 
record described at 250.105(1)(i) and forward it to the appropriate 
official within 30 days after the close of the month in which the record 
is prepared.



250.305-71  Processing cases to contract adjustment boards.

    (a) The officer or official responsible for the case shall forward 
to the contract adjustment board, through departmental channels, two 
copies of the following:
    (1) A letter stating--

    (i) The nature of the case;
    (ii) The basis for the board's authority to act;
    (iii) The findings of fact essential to the case (see FAR 50.304). 
Arrange the findings chronologically with cross references to supporting 
enclosures;
    (iv) The conclusions drawn;
    (v) The recommended disposition; and
    (vi) If contractual action is recommended, a statement by the signer 
that the action will facilitate the national defense.

    (2) The contractor's request
    (3) All evidentiary materials
    (4) All endorsements, reports and comments of cognizant Government 
officials
    (b) A letter to the Board recommending an amendment without 
consideration where essentiality is a factor (see FAR 50.302-1(a)) 
should also provide--
    (1) The information required by FAR 50.304 (a) and (b), and
    (2) Findings as to--

    (i) The contractor's performance record, including the quality of 
product, rate of production, and promptness of deliveries;
    (ii) The importance to the Government, particularly to the active 
duty military, of the performance of the contract and the importance of 
the contractor to the national defense;
    (iii) The forecast of future contracts with the contractor; and
    (iv) Other available sources of supply for the supplies or services 
covered by the contract, and the time and cost of having contract 
performance completed by such other sources.



250.305-72  Processing by the board.

    Contract adjustment boards will render decisions as expeditiously as 
practicable. The Chair shall sign a memorandum of decision disposing of 
the case. The decision shall be dated and shall contain the information 
required by FAR 50.306. The memorandum of decision shall not contain any 
information classified ``Confidential'' or higher. The board's decision 
will be sent to the appropriate official for implementation.



250.306  Disposition.



250.306-70  Record of disposition.

    (a) When the request for relief is denied or approved below the 
Secretarial level, submit the following documents to the appropriate 
office within 30 days after the close of the month in which the decision 
is executed:
    (1) Two copies of the memorandum of decision;
    (2) Except for the Army, one copy of the contractual document 
implementing any decision approving contractual action; and
    (3) One copy of a final record, as described at 250.105.
    (b) When a contract adjustment board decision is implemented, the 
activity which forwarded the case to the board shall prepare and submit 
to the board the documents identified in paragraphs (a) (2) and (3) of 
this subsection.



                     Subpart 250.4--Residual Powers



250.403  Special procedures for unusually hazardous or nuclear risks.



250.403-70  Indemnification under contracts involving both research and development and other work.

    When indemnification is to be provided on contracts requiring both 
research and development work and other work, the contracting officer 
shall insert an appropriate clause using the authority of both 10 U.S.C. 
2354 and Public Law 85-804.
    (a) The use of Public Law 85-804 is limited to work which cannot be 
indemnified under 10 U.S.C. 2354 and is

[[Page 398]]

subject to compliance with FAR subpart 50.4.
    (b) Indemnification under 10 U.S.C. 2354 is covered by 235.070.



PART 251--USE OF GOVERNMENT SOURCES BY CONTRACTORS--Table of Contents




Sec.

       Subpart 251.1--Contractor Use of Government Supply Sources

251.102  Authorization to use Government supply sources.
251.105  Payment for shipments.
251.107  Contract clause.

  Subpart 251.2--Contractor Use of Interagency Fleet Management System 
                             (IFMS) Vehicles

251.202  Authorization.
251.205  Contract clause.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36479, July 31, 1991, unless otherwise noted.



       Subpart 251.1--Contractor Use of Government Supply Sources



251.102  Authorization to use Government supply sources.

    (e) Use the format in Table 51-1, Authorization to Purchase from 
Government Supply Sources. Specify the terms of the purchase, including 
contractor acceptance of any Government materiel, payment terms, and the 
addresses required by paragraph (f) of the clause at 252.251-7000, 
Ordering from Government Supply Sources.
    (3)(ii) In addition to the procedure and form authorized by FAR 
51.102(e)(3)(ii), contractors may use the DD Form 1155 when 
requisitioning from the Department of Veterans Affairs.
    (f) The authorizing agency shall also be responsible for promptly 
considering requests of the DoD supply source for authority to refuse to 
honor requisitions from a contractor which is indebted to the DoD and 
has failed to pay proper invoices in a timely manner.

  Table 51-1--Authorization To Purchase From Government Supply Sources  
                                                                        
                                                                        
Subject: Authorization to Purchase from Government Supply Sources       
                                                                        
------------------------------------------------------------------------
(Contractor's Name)                                                     
                                                                        
------------------------------------------------------------------------
(Contractor's Address)                                                  
1. You are hereby authorized to use Government sources in performing    
 Contract No. ________ for the Department of ________, as follows:      
 (Insert applicable purchasing authority given to the contractor.)      
2.a. Purchase Orders Under Federal Supply Schedules or Personal Property
 Rehabilitation Price Schedules. Place orders in accordance with the    
 terms and conditions of the attached Schedule(s) and this              
 authorization. Attach a copy of this authorization to the order (unless
 a copy was previously furnished to the Federal Supply Schedule or      
 Personal Property Rehabilitation Price Schedule contractor). Insert the
 following statement in the order:                                      
                                                                        
  This order is placed under written authorization from ________ dated  
   ________ (\1\______).                                                
  In the event of any inconsistency between the terms and conditions of 
   this order and those of the Federal Supply Schedule or Personal      
   Property Rehabilitation Price Schedule contract, the latter will     
   govern.                                                              
                                                                        
b. Requisitioning from the General Services Administration (GSA) or the 
 Department of Defense (DoD). Place orders in accordance with this      
 authorization and, as appropriate, the:                                
  (1) Federal Standard Requisitioning and Issue Procedures (FEDSTRIP)   
   (GSAFEDSTRIP Operating Guide: FPMR 101-26.2 (41 CFR 101-26.2); copies
   are available from the Superintendent of Documents, Government       
   Printing Office, Washington, DC 20402); or                           
  (2) Military Standard Requisitioning and Issue Procedures (MILSTRIP)  
   (DoD 4000.25-1-M; copies are available from the Defense Logistics    
   Agency, ATTN: DLA-XPD, Bldg. 6, Dr. 21, Cameron Station, Alexandria, 
   VA 22304-6100).                                                      
3. (\3\)                                                                
4. This authority is not transferable or assignable.                    
5. The DoD Activity Address Directory (DoDAAD) (DoD 4000.25-6-M)        
 Activity Address Code \2\ to which this Authorization applies is       
 ________.                                                              
6. This Authorization expires __________.                               
                                                                        
------------------------------------------------------------------------
(Contracting Officer)                                                   
------------------------------------------------------------------------
\1\ Insert ``a copy of which is attached,'' ``a copy of which you have  
  on file,'' or other suitable language, as appropriate.                
\2\ The sponsoring service assumes responsibility for monitoring and    
  controlling all activity address codes used in the letters of         
  authority.                                                            
\3\ Insert other provisions, as necessary.                              
                                                                        

[[Page 399]]

                                                                        

[56 FR 36479, July 31, 1991, as amended at 60 FR 29501, June 5, 1995]



251.105  Payment for shipments.

    Contractor payments for purchases from DoD supply sources are due 
within 30 days of the date of a proper invoice (see FAR 32.902 for 
definition of ``due date'' and ``payment date;'' also see FAR 
32.905(e)).
[60 FR 29501, June 5, 1995]



251.107  Contract clause.

    Use the clause at 252.251-7000, Ordering From Government Supply 
Sources, in solicitations and contracts which include the clause at FAR 
52.251-1, Government Supply Sources.



  Subpart 251.2--Contractor Use of Interagency Fleet Management System 
                             (IFMS) Vehicles



251.202  Authorization.

    (a)(2)(A) See FAR 28.307-2(c) for policy on contractor insurance.
    (B) See FAR 28.308 for policy on self-insurance.
    (C) See FAR 31.205-19 for allowability of insurance costs.
    (5) Paragraph (d) of the clause at 252.251-7001 satisfies the 
requirement of FAR 51.202(a)(5) for a written statement.



251.205  Contract clause.

    Use the clause at 252.251-7001, Use of Interagency Fleet Management 
System (IFMS)Vehicles and Related Services, in solicitations and 
contracts which include the clause at FAR 52.251-2, Interagency Fleet 
Management System (IFMS) Vehicles and Related Services.

[[Page 400]]



                     SUBCHAPTER H--CLAUSES AND FORMS





PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES--Table of Contents




Sec.

      Subpart 252.1--Instructions for Using Provisions and Clauses

252.101  Using part 252.

             Subpart 252.2--Texts of Provisions and Clauses

252.201-7000  Contracting officer's representative.
252.203-7000  [Reserved]
252.203-7001  Special prohibition on employment.
252.203-7002  Display of DoD hotline poster.
252.204-7000  Disclosure of information.
252.204-7001  Commercial and Government Entity (CAGE) code reporting.
252.204-7002  Payment for subline items not separately priced.
252.204-7003  Control of government personnel work product.
252.205-7000  Provision of information to cooperative agreement holders.
252.206-7000  Domestic source restriction.
252.208-7000  Intent to furnish precious metals as Government-furnished 
          material.
252.209-7000  Acquisition from subcontractors subject to on-site 
          inspection under the Intermediate-Range Nuclear Forces (INF) 
          Treaty.
252.209-7001  Disclosure of ownership or control by the government of a 
          terrorist country.
252.209-7002  Disclosure of ownership or control by a foreign 
          government.
252.209-7003  252.209-7004[Reserved]
252.209-7005  Military recruiting on campus.
252.211-7000  Acquisition streamlining.
252.211-7001  Availability of specifications and standards not listed in 
          DODISS, data item descriptions not listed in DoD 5010.12-L, 
          and plans, drawings, and other pertinent documents.
252.211-7002  Availability for examination of specifications, standards, 
          plans, drawings, data item descriptions, and other pertinent 
          documents.
252.211-7003  Brand name or equal.
252.211-7004  Alternate preservation, packaging, and packing.
252.211-7005  Substitutions for military or Federal specifications and 
          standards.
252.212-7000  Offeror representations and certifications--Commercial 
          items.
252.212-7001  Contract terms and conditions required to implement 
          statutes or Executive Orders applicable to Defense 
          acquisitions of commercial items.
252.215-7000  Pricing adjustments.
252.215-7001  [Reserved]
252.215-7002  Cost estimating system requirements.
252.216-7000  Economic price adjustment--basic steel, aluminum, brass, 
          bronze, or copper mill products.
252.216-7001  Economic price adjustment--nonstandard steel items.
252.216-7002  [Reserved]
252.216-7003  Economic price adjustment--wage rates or material prices 
          controlled by a foreign government.
252.217-7000  Exercise of option to fulfill foreign military sales 
          commitments.
252.217-7001  Surge option.
252.217-7002  Offering property for exchange.
252.217-7003  Changes.
252.217-7004  Job orders and compensation.
252.217-7005  Inspection and manner of doing work.
252.217-7006  Title.
252.217-7007  Payments.
252.217-7008  Bonds.
252.217-7009  Default.
252.217-7010  Performance.
252.217-7011  Access to vessel.
252.217-7012  Liability and insurance.
252.217-7013  Guarantees.
252.217-7014  Discharge of liens.
252.217-7015  Safety and health.
252.217-7016  Plant protection.
252.217-7017  Time of delivery.
252.217-7018  Change in plant location--bakery and dairy products.
252.217-7019  Sanitary conditions.
252.217-7020  Examination and testing.
252.217-7021  Deficiency adjustment.
252.217-7022  Code dating.
252.217-7023  Marking.
252.217-7024  Responsibility for containers and equipment.
252.217-7025  Containers and equipment.
252.217-7026  Identification of sources of supply.
252.217-7027  Contract definitization.
252.217-7028  Over and above work.
252.219-7000  Small disadvantaged business concern representation (DoD 
          contracts).
252.219-7001  Notice of partial small business set-aside with 
          preferential consideration for small disadvantaged business 
          concerns.
252.219-7002  Notice of small disadvantaged business set-aside.
252.219-7003  Small, small disadvantaged and women-owned small business 
          subcontracting plan (DoD contracts).

[[Page 401]]

252.219-7004  Small, small disadvantaged and women-owned small business 
          subcontracting plan (test program).
252.219-7005  Incentive for subcontracting with small businesses, small 
          disadvantaged businesses, historically black colleges and 
          universities, and minority institutions.
252.219-7006  Notice of evaluation preference for small disadvantaged 
          business concerns.
252.219-7007  [Reserved]
252.219-7008  Notice of evaluation preference for small disadvantaged 
          business concerns--construction acquisitions--test program.
252.222-7000  Restrictions on employment of personnel.
252.222-7001  Right of first refusal of employment--Closure of military 
          installations.
252.222-7002  Compliance with local labor laws (overseas).
252.222-7003  Permit from Italian Inspectorate of Labor.
252.222-7004  Compliance with Spanish social security laws and 
          regulations.
252.223-7000  [Reserved]
252.223-7001  Hazard warning labels.
252.223-7002  Safety precautions for ammunition and explosives.
252.223-7003  Change in place of performance--ammunition and explosives.
252.223-7004  [Reserved]
252.223-7005  Hazardous waste liability.
252.223-7006  Prohibition on storage and disposal of toxic and hazardous 
          materials.
252.223-7007  Safeguarding sensitive conventional arms, ammunition, and 
          explosives.
252.225-7000  Buy American Act--Balance of Payments Program Certificate.
252.225-7001  Buy American Act and Balance of Payments Program.
252.225-7002  Qualifying country sources as subcontractors.
252.225-7003  Information for duty-free entry evaluation.
252.225-7004  [Reserved]
252.225-7005  Identification of expenditures in the United States.
252.225-7006  Buy American Act--trade agreements--Balance of Payments 
          Program certificate.
252.225-7007  Trade agreements.
252.225-7008  Supplies to be accorded duty-free entry.
252.225-7009  Duty-free entry--qualifying country end products and 
          supplies.
252.225-7010  Duty-free entry--additional provisions.
252.225-7011  Restriction on acquisition of supercomputers.
252.225-7012  Preference for certain domestic commodities.
252.225-7013  [Reserved]
252.225-7014  Preference for domestic specialty metals.
252.225-7015  Preference for domestic hand or measuring tools.
252.225-7016  Restriction on acquisition of ball and roller bearings.
252.225-7017  [Reserved]
252.225-7018  Notice of prohibition of certain contracts with foreign 
          entities for the conduct of Ballistic Missile Defense RDT&E.
252.225-7019  Restriction on acquisition of foreign anchor and mooring 
          chain.
252.225-7020--252.225-7021  [Reserved]
252.225-7022  Restriction on acquisition of polyacrylonitrile (PAN) 
          carbon fiber.
252.225-7023  [Reserved]
252.225-7024  Restriction on acquisition of night vision image 
          intensifier tubes and devices.
252.225-7025  Restriction on acquisition of forgings.
252.225-7026  Reporting of contract performance outside the United 
          States.
252.225-7027  Restriction on contingent fees for foreign military sales.
252.225-7028  Exclusionary policies and practices of foreign 
          governments.
252.225-7029  Preference for United States or Canadian air circuit 
          breakers.
252.225-7030  Restriction on acquisition of carbon, alloy, and armor 
          steel plate.
252.225-7031  Secondary Arab boycott of Israel.
252.225-7032  Waiver of United Kingdom levies.
252.225-7033  Restriction on acquisition of four ton dolly jacks.
252.225-7034  [Reserved]
252.225-7035  Buy American Act--North American Free Trade Agreement 
          Implementation Act--Balance of Payments Program Certificate.
252.225-7036  North American Free Trade Agreement Implementation Act.
252.225-7037  Duty-free entry--NAFTA country end products and supplies.
252.225-7038  Restriction on acquisition of aircraft fuel cells.
252.225-7039  Restriction on acquisition of totally enclosed lifeboat 
          survival systems.
252.225-7040  [Reserved]
252.225-7041  Correspondence in English.
252.225-7042  Authorization to perform.
252.226-7000  Notice of historically black college or university and 
          minority institution set-aside.
252.226-7001  Historically Black College or University and Minority 
          Institution Status.
252.227-7000  Non-estoppel.
252.227-7001  Release of past infringement.
252.227-7002  Readjustment of payments.
252.227-7003  Termination.
252.227-7004  License grant.
252.227-7005  License term.
252.227-7006  License grant--running royalty.
252.227-7007  License term--running royalty.
252.227-7008  Computation of royalties.

[[Page 402]]

252.227-7009  Reporting and payment of royalties.
252.227-7010  License to other Government agencies.
252.227-7011  Assignments.
252.227-7012  Patent license and release contract.
252.227-7013  Rights in technical data--Noncommercial items.
252.227-7014  Rights in noncommercial computer software and 
          noncommercial computer software documentation.
252.227-7015  Technical data--Commercial items.
252.227-7016  Rights in bid or proposal information.
252.227-7017  Identification and assertion of use, release, or 
          disclosure restrictions.
252.227-7018  Rights in noncommercial technical data and computer 
          software--Small Business Innovation Research (SBIR) Program.
252.227-7019  Validation of asserted restrictions--Computer software.
252.227-7020  Rights in special works.
252.227-7021  Rights in data--existing works.
252.227-7022  Government rights (unlimited).
252.227-7023  Drawings and other data to become property of Government.
252.227-7024  Notice and approval of restricted designs.
252.227-7025  Limitations on the use or disclosure of government-
          furnished information marked with restrictive legends.
252.227-7026  Deferred delivery of technical data or computer software.
252.227-7027  Deferred ordering of technical data or computer software.
252.227-7028  Technical data or computer software previously delivered 
          to the government.
252.227-7029  [Reserved]
252.227-7030  Technical data--withholding of payment.
252.227-7031  [Reserved]
252.227-7032  Rights in technical data and computer software (foreign).
252.227-7033  Rights in shop drawings.
252.227-7034  Patents--subcontracts.
252.227-7035  [Reserved]
252.227-7036  Declaration of Technical Data Conformity.
252.227-7037  Validation of restrictive markings on technical data.
252.227-7038  [Reserved]
252.227-7039  Patents--reporting of subject inventions.
252.228-7000  Reimbursement for war-hazard losses.
252.228-7001  Ground and flight risk.
252.228-7002  Aircraft flight risk.
252.228-7003  Capture and detention.
252.228-7004  Bonds or other security.
252.228-7005  Accident reporting and investigation involving aircraft, 
          missiles, and space launch vehicles.
252.228-7006  Compliance with Spanish laws and insurance.
252.229-7000  Invoices exclusive of taxes or duties.
252.229-7001  Tax relief.
252.229-7002  Customs exemptions (Germany).
252.229-7003  Tax exemptions (Italy).
252.229-7004  Status of contractors as a direct contractor (Spain).
252.229-7005  Tax exemptions (Spain).
252.229-7006  Value added tax exclusion (United Kingdom).
252.229-7007  Verification of United States receipt of goods.
252.229-7008  Relief from import duty (United Kingdom).
252.229-7009  Relief from customs duty and value added tax on fuel 
          (passenger vehicles) (United Kingdom).
252.229-7010  Relief from customs duty on fuel (United Kingdom).
252.231-7000  Supplemental cost principles.
252.232-7000  Advance payment pool.
252.232-7001  Disposition of payments.
252.232-7002  Progress payments for foreign military sales acquisitions.
252.232-7003  Flexible progress payments.
252.232-7004  DoD progress payment rates.
252.232-7005  Reimbursement of subcontractor advance payments--DoD pilot 
          mentor-protege program.
252.232-7006  Reduction or suspension of contract payments upon finding 
          of fraud.
252.232-7007  Limitation of Government's obligation.
252.232-7008  Assignment of claims (overseas).
252.233-7000  [Reserved]
252.233-7001  Choice of law (overseas).
252.234-7000  Notice of earned value management system.
252.234-7001  Earned value management system.
252.235-7000  Indemnification under 10 U.S.C. 2354--fixed price.
252.235-7001  Indemnification under 10 U.S.C. 2354--cost reimbursement.
252.235-7002  Animal welfare.
252.235-7003  Frequency authorization.
252.235-7004  Option to extend the term of the contract.
252.235-7005  Contractor-acquired property.
252.235-7006  Title to contractor-acquired property.
252.235-7007  Advance payments.
252.235-7008  Inspection and acceptance.
252.235-7009  Restriction on printing.
252.235-7010  Acknowledgement of support and disclaimer.
252.235-7011  Final scientific or technical report.
252.236-7000  Modification proposals--price breakdown.
252.236-7001  Contract drawings, maps, and specifications.

[[Page 403]]

252.236-7002  Obstruction of navigable waterways.
252.236-7003  Payment for mobilization and preparatory work.
252.236-7004  Payment for mobilization and demobilization.
252.236-7005  Airfield safety precautions.
252.236-7006  Cost limitation.
252.236-7007  Additive or deductive items.
252.236-7008  Contract prices--bidding schedules.
252.236-7009  Option for supervision and inspection services.
252.236-7010  Overseas Military Construction--Preference for United 
          States Firms.
252.236-7011  Overseas Architect-Engineer Services--Restriction to 
          United States Firms.
252.237-7000  Notice of special standards of responsibility.
252.237-7001  Compliance with audit standards.
252.237-7002  Award to single offeror.
252.237-7003  Requirements.
252.237-7004  Area of performance.
252.237-7005  Performance and delivery.
252.237-7006  Subcontracting.
252.237-7007  Termination for default.
252.237-7008  Group interment.
252.237-7009  Permits.
252.237-7010  Facility requirements.
252.237-7011  Preparation history.
252.237-7012  Instruction to offerors (count-of-articles).
252.237-7013  Instruction to offerors (bulk weight).
252.237-7014  Loss or damage (count-of-articles).
252.237-7015  Loss or damage (weight of articles).
252.237-7016  Delivery tickets.
252.237-7017  Individual laundry.
252.237-7018  Special definitions of Government property.
252.237-7019  Identification of uncompensated overtime.
252.237-7020--252.237-7021  [Reserved]
252.237-7022  Services at installations being closed.
252.239-7000  Protection against compromising emanations.
252.239-7001  [Reserved]
252.239-7002  Access.
252.239-7003  Facilities and services to be furnished--common carriers.
252.239-7004  Orders for facilities and services--common carriers.
252.239-7005  Rates, charges, and services--common carriers.
252.239-7006  Tariff information.
252.239-7007  Cancellation or termination of orders--common carriers.
252.239-7008  Reuse arrangements.
252.239-7009--252.239-7010  [Reserved]
252.239-7011  Special construction and equipment charges.
252.239-7012  Title to telecommunication facilities and equipment.
252.239-7013  Obligation of the Government.
252.239-7014  Term of agreement.
252.239-7015  Continuation of communication service authorizations.
252.239-7016  Telecommunications security equipment, devices, 
          techniques, and services.
252.241-7000  Superseding contract.
252.241-7001  Government access.
252.242-7000  Postaward conference.
252.242-7001--252.242-7002  [Reserved]
252.242-7003  Application for U.S. Government shipping documentation/
          instructions.
252.242-7004  Material management and accounting system.
252.242-7005  Cost/Schedule Status Report.
252.242-7006  Cost/Schedule Status Report Plans.
252.243-7000  Engineering change proposals.
252.243-7001  Pricing of contract modifications.
252.243-7002  Certification of requests for equitable adjustment.
252.244-7000  Subcontracts for commercial items and commercial 
          components (DoD contracts).
252.245-7000  Government-furnished mapping, charting, and geodesy 
          property.
252.245-7001  Reports of Government property.
252.246-7000  Material inspection and receiving report.
252.246-7001  Warranty of data.
252.246-7002  Warranty of construction (Germany).
252.247-7000  Hardship conditions.
252.247-7001  Price adjustment.
252.247-7002  Revision of prices.
252.247-7003  Termination.
252.247-7004  Indefinite quantities--fixed charges.
252.247-7005  Indefinite quantities--no fixed charges.
252.247-7006  Removal of Contractor's employees.
252.247-7007  Liability and insurance.
252.247-7008  Evaluation of bids.
252.247-7009  Award.
252.247-7010  Scope of contract.
252.247-7011  Period of contract.
252.247-7012  Ordering limitation.
252.247-7013  Contract areas of performance.
252.247-7014  Demurrage.
252.247-7015  Requirements.
252.247-7016  Contractor liability for loss or damage.
252.247-7017  Erroneous shipments.
252.247-7018  Subcontracting.
252.247-7019  Drayage.
252.247-7020  Additional services.
252.247-7021  Returnable containers other than cylinders.
252.247-7022  Representation of extent of transportation by sea.

[[Page 404]]

252.247-7023  Transportation of supplies by sea.
252.247-7024  Notification of transportation of supplies by sea.
252.247-7025  Reflagging or repair work.
252.248-7000  Preparation of value engineering change proposals.
252.249-7000  Special termination costs.
252.249-7001  [Reserved]
252.249-7002  Notification of anticipated contract termination or 
          reduction.
252.251-7000  Ordering from Government supply sources.
252.251-7001  Use of Interagency Fleet Management System (IFMS) vehicles 
          and related services.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36479, July 31, 1991, unless otherwise noted.



      Subpart 252.1--Instructions for Using Provisions and Clauses



252.101  Using part 252.

    (b) Numbering.
    (2) Provisions or clauses that supplement the FAR.
    (ii)(B) DFARS provisions or clauses use a four digit sequential 
number in the 7000 series, e.g., -7000, -7001, -7002. Department or 
agency supplemental provisions or clauses use four digit sequential 
numbers in the 9000 series.



              Subpart 252.2--Text of Provisions And Clauses



252.201-7000  Contracting officer's representative.

    As prescribed in 201.602-70, use the following clause:

            Contracting Officer's Representative (Dec. 1991)

    (a) Definition. Contracting officer's representative means an 
individual designated in accordance with subsection 201.602-2 of the 
Defense Federal Acquisition Regulation Supplement and authorized in 
writing by the contracting officer to perform specific technical or 
administrative functions.
    (b) If the Contracting Officer designates a contracting officer's 
representative (COR), the Contractor will receive a copy of the written 
designation. It will specify the extent of the COR's authority to act on 
behalf of the contracting officer. The COR is not authorized to make any 
commitments or changes that will affect price, quality, quantity, 
delivery, or any other term or condition of the contract.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 57 FR 42633, Sept. 15, 1992]



252.203-7000  [Reserved]



252.203-7001  Special prohibition on employment.

    As prescribed in 203.570-5, use the following clause:

              Special Prohibition on Employment (JUN 1997)

    (a) Definitions.
    As used in this clause--
    (1) Arising out of a contract with the DoD means any act in 
connection with--
    (i) Attempting to obtain,
    (ii) Obtaining, or
    (iii) Performing a contract or first-tier subcontract of any agency, 
department, or component of the Department of Defense (DoD).
    (2) Conviction of fraud or any other felony means any conviction for 
fraud or a felony in violation of state or Federal criminal statutes, 
whether entered on a verdict or plea, including a plea of nolo 
contendere, for which sentence has been imposed.
    (3) Date of conviction means the date judgment was entered against 
the individual.
    (b) 10 U.S.C. 2408 provides that any individual who is convicted 
after September 29, 1988, of fraud or any other felony arising out of a 
contract with the DoD is prohibited from:
    (1) Working in a management or supervisory capacity on any DoD 
contract or first-tier subcontract;
    (2) Serving on the board of directors of any DoD contractor or 
first-tier subcontractor; or
    (3) Serving as a consultant to any DoD contractor or first-tier 
subcontractor.
    (c) Unless waived, the prohibition in paragraph (b) applies for five 
years from the date of conviction.
    (d) 10 U.S.C. 2408 further provides that a defense contractor or 
first-tier subcontractor shall be subject to a criminal penalty of not 
more than $500,000 if convicted of knowingly--
    (1) Employing a person under a prohibition specified in paragraph 
(b) of this clause; or
    (2) Allowing such a person to serve on the board of directors of the 
contractor or first-tier subcontractor.
    (e) In addition to the criminal penalties contained in 10 U.S.C. 
2408, the Government may consider other available remedies, such as--
    (1) Suspension or debarment;
    (2) Cancellation of the contract at no cost to the Government; or
    (3) Termination of the contract for default.

[[Page 405]]

    (f) The Contractor may submit written requests for waiver of the 
prohibitions in paragraph (b) of this clause to the Contracting Officer. 
Requests shall clearly identify--
    (1) The person involved;
    (2) The nature of the conviction and resultant sentence or 
punishment imposed;
    (3) The reasons for the requested waiver; and,
    (4) An explanation of why a waiver is in the interest of national 
security.
    (g) The Contractor agrees to include the substance of this clause, 
appropriately modified to reflect the identity and relationship of the 
parties, in all first-tier subcontracts exceeding the simplified 
acquisition threshold in part 2 of the Federal Acquisition Regulation, 
except those for commercial items or components.
    (h) Pursuant to 10 U.S.C. 2408(c), defense contractors and 
subcontractors may obtain information as to whether a particular person 
has been convicted of fraud or any other felony arising out of a 
contract with the DoD by contacting The Office of Justice Programs, The 
Denial of Benefits Office, U.S. Department of Justice, telephone (202) 
616-3507.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 58 FR 28471, May 13, 1993; 59 
FR 27675, May 27, 1994; 60 FR 61600, Nov. 30, 1995; 62 FR 34128, June 
24, 1997]



252.203-7002  Display of DoD hotline poster.

    As prescribed in 203.7002, use the following clause:

                Display of DOD Hotline Poster (Dec. 1991)

    (a) The Contractor shall display prominently in common work areas 
within business segments performing work under Department of Defense 
(DoD) contracts, DoD Hotline Posters prepared by the DoD Office of the 
Inspector General.
    (b) DoD Hotline Posters may be obtained from the DoD Inspector 
General, Attn: Defense Hotline, 400 Army Navy Drive, Washington, DC 
22202-2884.
    (c) The Contractor need not comply with paragraph (a) of this clause 
if it has established a mechanism, such as a hotline, by which employees 
may report suspected instances of improper conduct, and instructions 
that encourage employees to make such reports.

                             (End of clause)



252.204-7000  Disclosure of Information.

    As prescribed in 204.404-70(a), use the following clause:

                  Disclosure of Information (Dec. 1991)

    (a) The Contractor shall not release to anyone outside the 
Contractor's organization any unclassified information, regardless of 
medium (e.g., film, tape, document), pertaining to any part of this 
contract or any program related to this contract, unless--
    (1) The Contracting Officer has given prior written approval; or
    (2) The information is otherwise in the public domain before the 
date of release.
    (b) Requests for approval shall identify the specific information to 
be released, the medium to be used, and the purpose for the release. The 
Contractor shall submit its request to the Contracting Officer at least 
45 days before the proposed date for release.
    (c) The Contractor agrees to include a similar requirement in each 
subcontract under this contract. Subcontractors shall submit requests 
for authorization to release through the prime contractor to the 
Contracting Officer.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 57 FR 14996, Apr. 23, 1992]



252.204-7001  Commercial and Government Entity (CAGE) code reporting.

    As prescribed in 204.602-70, use the following provision:

   Commercial and Government Entity (CAGE) Code Reporting (Dec. 1991)

    (a) The Offeror is requested to enter its CAGE code on its offer in 
the block with its name and address. The CAGE code entered must be for 
that name and address. Enter CAGE before the number.
    (b) If the Offeror does not have a CAGE code, it may ask the 
Contracting Officer to request one from the Defense Logistics Services 
Center (DLSC). The Contracting Officer will--
    (1) Ask the Contractor to complete section B of a DD Form 2051, 
Request for Assignment of a Commercial and Government Entity (CAGE) 
Code;
    (2) Complete section A and forward the form to DLSC; and
    (3) Notify the Contractor of its assigned CAGE code.

[[Page 406]]

    (c) Do not delay submission of the offer pending receipt of a CAGE 
code.

                           (End of provision)

[56 FR 36479, July 31, 1991, as amended at 60 FR 61600, Nov. 30, 1995]



252.204-7002  Payment for subline items not separately priced.

    As prescribed in 204.7104-1(b)(3)(iv), use the following clause:

       Payment for Subline Items not Separately Priced (Dec. 1991)

    (a) If the schedule in this contract contains any contract subline 
items or exhibit subline items identified as not separately priced 
(NSP), it means that the unit price for that subline item is included in 
the unit price of another, related line or subline item.
    (b) The Contractor shall not invoice the Government for any portion 
of a contract line item or exhibit line item which contains an NSP 
until--
    (1) The Contractor has delivered the total quantity of all related 
contract subline items or exhibit subline items; and
    (2) The Government has accepted them.
    (c) This clause does not apply to technical data.

                             (End of clause)



252.204-7003  Control of government personnel work product.

    As prescribed in 204.404-70(b), use the following clause:

        Control of Government Personnel Work Product (Apr. 1992)

    The Contractor's procedures for protecting against unauthorized 
disclosure of information shall not require Department of Defense 
employees or members of the Armed Forces to relinquish control of their 
work products, whether classified or not, to the contractor.

                             (End of clause)

[57 FR 14996, Apr. 23, 1992]



252.205-7000  Provision of information to cooperative agreement holders.

    As prescribed in 205.470-2, use the following clause:

  Provision of Information to Cooperative Agreement Holders (Dec. 1991)

    (a) Definition.
    Cooperative agreement holder means a State or local government; a 
private, nonprofit organization; a tribal organization (as defined in 
section 4(c) of the Indian Self-Determination and Education Assistance 
Act (Pub. L. 93-268; 25 U.S.C. 450(c))); or an economic enterprise (as 
defined in section 3(e) of the Indian Financing Act of 1974 (Pub. L. 93-
362; 25 U.S.C. 1452(e))) whether such economic enterprise is organized 
for profit or nonprofit purposes; which has an agreement with the 
Defense Logistics Agency to furnish procurement technical assistance to 
business entities.
    (b) The Contractor shall provide cooperative agreement holders, upon 
their request, with a list of those appropriate employees or offices 
responsible for entering into subcontracts under defense contracts. The 
list shall include the business address, telephone number, and area of 
responsibility of each employee or office.
    (c) The Contractor need not provide the listing to a particular 
cooperative agreement holder more frequently than once a year.

                             (End of clause)



252.206-7000  Domestic source restriction.

    As prescribed at 206.302-3-70, use the following provision:

                 Domestic Source Restriction (Dec. 1991)

    This solicitation is restricted to domestic sources under the 
authority of 10 U.S.C. 2304(c)(3). Foreign sources, except Canadian 
sources, are not eligible for award.

                           (End of provision)



252.208-7000  Intent to furnish precious metals as Government-furnished material.

    As prescribed in 208.7305(a), use the following clause:

Intent To Furnish Precious Metals as Government-Furnished Material (Dec. 
                                  1991)

    (a) The Government intends to furnish precious metals required in 
the manufacture of items to be delivered under the contract if the 
Contracting Officer determines it to be in the Government's best 
interest. The use of Government-furnished silver is mandatory when the 
quantity required is one hundred troy ounces or more. The precious 
metal(s) will be furnished pursuant to the Government Furnished Property 
clause of the contract.
    (b) The Offeror shall cite the type (silver, gold, platinum, 
palladium, iridium, rhodium, and ruthenium) and quantity in whole troy 
ounces of precious metals required in the performance of this contract 
(including precious metals required for any first article or

[[Page 407]]

production sample), and shall specify the national stock number (NSN) 
and nomenclature, if known, of the deliverable item requiring precious 
metals.

                                                                        
------------------------------------------------------------------------
                                                       Deliverable item 
        Precious metal*               Quantity             (NSN and     
                                                      nomenclature)!!rs 
------------------------------------------------------------------------
  ......................................................................
------------------------------------------------------------------------
*If platinum or palladium, specify whether sponge or granules are       
  required.                                                             

    (c) Offerors shall submit two prices for each deliverable item which 
contains precious metals--one based on the Government furnishing 
precious metals, and one based on the Contractor furnishing precious 
metals. Award will be made on the basis which is in the best interest of 
the Government.
    (d) The Contractor agrees to insert this clause, including this 
paragraph (d), in solicitations for subcontracts and purchase orders 
issued in performance of this contract, unless the Contractor knows that 
the item being purchased contains no precious metals.

                             (End of clause)



252.209-7000  Acquisition from subcontractors subject to on-site inspection under the Intermediate-Range Nuclear Forces (INF) Treaty.

    As prescribed in 209.103-70, use the following clause:

Acquisition From Subcontractors Subject to On-Site Inspection Under the 
        Intermediate-Range Nuclear Forces (INF) Treaty (NOV 1995)

    (a) The Contractor shall not deny consideration for a subcontract 
award under this contract to a potential subcontractor subject to on-
site inspection under the INF Treaty, or a similar treaty, solely or in 
part because of the actual or potential presence of Soviet inspectors at 
the subcontractor's facility, unless the decision is approved by the 
Contracting Officer.
    (b) The Contractor shall incorporate this clause, including this 
paragraph (b), in all solicitations and contracts exceeding the 
simplified acquisition threshold in part 13 of the Federal Acquisition 
Regulation, except those for commercial items.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 60 FR 61600, Nov. 30, 1995]



252.209-7001  Disclosure of ownership or control by the government of a terrorist country.

    As prescribed in 209.104-70(a), use the following provision:

  Disclosure of Ownership or Control by the Government of a Terrorist 
                           Country (Sep. 1994)

    (a) Definitions. As used in this provision--
    (1) Government of a terrorist country includes the state and the 
government of a terrorist country, as well as any political subdivision, 
agency, or instrumentality thereof.
    (2) Terrorist country means a country determined by the Secretary of 
State, under section 6(j)(1)(A) of the Export Administration Act of 1979 
(50 U.S.C. App. 2405(j)(i)(A)), to be a country the government of which 
has repeatedly provided support for acts of international terrorism. As 
of the date of this provision, terrorist countries include: Cuba, Iran, 
Iraq, Libya, North Korea, Sudan, and Syria.
    (3) Significant interest means--
    (i) Ownership of or beneficial interest in 5 percent or more of the 
firm's or subsidiary's securities. Beneficial interest includes holding 
5 percent or more of any class of the firm's securities in ``nominee 
shares,'' ``street names,'' or some other method of holding securities 
that does not disclose the beneficial owner;
    (ii) Holding a management position in the firm, such as a director 
or officer;
    (iii) Ability to control or influence the election, appointment, or 
tenure of directors or officers in the firm;
    (iv) Ownership of 10 percent or more of the assets of a firm such as 
equipment, buildings, real estate, or other tangible assets of the firm; 
or
    (v) Holding 50 percent or more of the indebtedness of a firm.
    (b) Prohibition on award. In accordance with 10 U.S.C. 2327, no 
contract may be awarded to a firm or a subsidiary of a firm if the 
government of a terrorist country has a significant interest in the firm 
or subsidiary, unless a waiver is granted by the Secretary of Defense.
    (c) Disclosure. If the government of a terrorist country has a 
significant interest in the Offeror or a subsidiary of the Offeror, the 
Offeror shall disclose such interest in an attachment to its offer. If 
the Offeror is a subsidiary, it shall also disclose any significant 
interest the government of a terrorist country has in any firm that owns 
or controls the subsidiary. The disclosure shall include--
    (1) Identification of each government holding a significant 
interest; and
    (2) A description of the significant interest held by each 
government.

                           (End of provision)

[59 FR 51131, Oct. 7, 1994]

[[Page 408]]



252.209-7002  Disclosure of ownership or control by a foreign government.

    As prescribed in 209.104-70(b), use the following provision:

 Disclosure of Ownership or Control by a Foreign Government (Sep. 1994)

    (a) Definitions. As used in this provision--
    (1) Effectively owned or controlled means that a foreign government 
or any entity controlled by a foreign government has the power, either 
directly or indirectly, whether exercised or exercisable, to control the 
election, appointment, or tenure of the Offeror's officers or a majority 
of the Offeror's board of directors by any means, e.g., ownership, 
contract, or operation of law (or equivalent power for unincorporated 
organizations).
    (2) Entity controlled by a foreign government--
    (i) Means--
    (A) Any domestic or foreign organization or corporation that is 
effectively owned or controlled by a foreign government; or
    (B) Any individual acting on behalf of a foreign government.
    (ii) Does not include an organization or corporation that is owned, 
but is not controlled, either directly or indirectly, by a foreign 
government if the ownership of that organization or corporation by that 
foreign government was effective before October 23, 1992.
    (3) Foreign government includes the state and the government of any 
country (other than the United States and its possessions and trust 
territories) as well as any political subdivision, agency, or 
instrumentality thereof.
    (4) Proscribed information means--
    (i) Top Secret information;
    (ii) Communications Security (COMSEC) information, except classified 
keys used to operate secure telephone units (STU IIIs);
    (iii) Restricted Data as defined in the U.S. Atomic Energy Act of 
1954, as amended;
    (iv) Special Access Program (SAP) information; or
    (v) Sensitive Compartmented Information (SCI).
    (b) Prohibition on award. No contract under a national security 
program may be awarded to an entity controlled by a foreign government 
if that entity requires access to proscribed information to perform the 
contract, unless the Secretary of Defense or a designee has waived 
application of 10 U.S.C. 2536(a).
    (c) Disclosure. The Offeror shall disclose any interest a foreign 
government has in the Offeror when that interest constitutes control by 
a foreign government as defined in this provision. If the Offeror is a 
subsidiary, it shall also disclose any reportable interest a foreign 
government has in any entity that owns or controls the subsidiary, 
including reportable interest concerning the Offeror's immediate parent, 
intermediate parents, and the ultimate parent. Use separate paper as 
needed, and provide the information in the following format: Offeror's 
Point of Contact for Questions about Disclosure (Name and Phone Number 
with Country Code, City Code and Area Code, as applicable)

                                                                        
                                                                        
                                                                        
Name and Address of Offeror                                             
Name and Address of Entity Controlled by  Description of Interest,      
 a Foreign Government.                     Ownership Percentage, and    
                                           Identification of Foreign    
                                           Government                   
                                                                        

                           (End of provision)

[58 FR 28471, May 13, 1993, as amended at 59 FR 51133, Oct. 7, 1994]



252.209-7003--252.209-7004  [Reserved]



252.209-7005  Military recruiting on campus.

    As prescribed in 209.470-3, use the following clause:

                Military Recruiting on Campus (FEB 1996)

    (a) Definition.
    Directory information, as used in this clause, means, with respect 
to a student, the student's name, address, telephone listing, date and 
place of birth, level of education, degrees received, and the most 
recent previous educational institution enrolled in by the student. 
Students are individuals who are 17 years of age or older.
    (b) General. An institution of higher education that has been 
determined, using procedures established by the Secretary of Defense at 
32 CFR part 216: (1) to have a policy of denying, or (2) to effectively 
prevent the Secretary of Defense from obtaining for military recruiting 
purposes, entry to such institution's campuses, access to students on 
those campuses, or access to directory information pertaining to its 
students, is ineligible for contract award and payments under existing 
contracts. In addition, the Government shall terminate this contract for 
the Contractor's material failure to comply with the terms and 
conditions of award.
    (c) Agreement. The contractor represents that it does not now have 
and agrees that during performance of this contract it will not adopt a 
policy of denying, and that it does not, is not, and will not during 
performance of the contract, effectively prevent the Secretary of 
Defense from obtaining for military recruiting purposes entry to 
campuses, access to students on campuses, or access to directory 
information pertaining to students.

[[Page 409]]

                             (End of clause)

[60 FR 13074, Mar. 10, 1995. Redesignated and amended at 60 FR 61600, 
Nov. 30, 1995; 61 FR 7750, Feb. 29, 1996]



252.211-7000  Acquisition streamlining.

    As prescribed in 211.002-70, use the following clause:

                  Acquisition Streamlining (Dec. 1991)

    (a) The Government's acquisition streamlining objectives are to--
    (1) Acquire systems that meet stated performance requirements;
    (2) Avoid over-specification; and
    (3) Ensure that cost effective requirements are included in future 
acquisitions.
    (b) The Contractor shall--
    (1) Prepare and submit acquisition streamlining recommendations in 
accordance with the statement of work of this contract; and
    (2) Format and submit the recommendations as prescribed by data 
requirements on the contract data requirements list of this contract.
    (c) The Government has the right to accept, modify, or reject the 
Contractor's recommendations.
    (d) The Contractor shall insert this clause, including this 
paragraph (d), in all subcontracts over $1 million, awarded in the 
performance of this contract.

                             (End of clause)

[56 FR 36479, July 31, 1991. Redesignated and amended at 60 FR 61600, 
Nov. 30, 1995]



252.211-7001  Availability of specifications and standards Not listed in DODISS, data item descriptions Not listed in DoD 5010.12-L, and plans, drawings, and 
          other pertinent documents.

    As prescribed in 211.204(c), use the following provision:

Availability of Specifications and Standards not Listed in DODISS, Data 
Item Descriptions Not Listed in DOD 5010.12-L, and Plans, Drawings, and 
                  Other Pertinent Documents (Dec. 1991)

    Offerors may obtain the specifications, standards, plans, drawings, 
data item descriptions, and other pertinent documents cited in this 
solicitation by submitting a request to:

 (Activity)_____________________________________________________________
 (Complete Address)_____________________________________________________

    Include the number of the solicitation and the title and number of 
the specification, standard, plan, drawing, or other pertinent document.

                           (End of provision)

[56 FR 36479, July 31, 1991. Redesignated and amended at 60 FR 61600, 
Nov. 30, 1995]



252.211-7002  Availability for examination of specifications, standards, plans, drawings, data item descriptions, and other pertinent documents.

    As prescribed in 211.204(c), use the following provision:

   Availability for Examination of Specifications, Standards, Plans, 
 Drawings, Data Item Descriptions, and Other Pertinent Documents (Dec. 
                                  1991)

    The specifications, standards, plans, drawings, data item 
descriptions, and other pertinent documents cited in this solicitation 
are not available for distribution but may be examined at the following 
location:

   _____________________________________________________________________
(Insert complete address)

                           (End of provision)

[56 FR 36479, July 31, 1991. Redesignated and amended at 60 FR 61600, 
Nov. 30, 1995]



252.211-7003  Brand name or equal.

    As prescribed in 211.270-2, use the following provision:

                     Brand Name or Equal (Dec. 1991)

    (a) If items in this solicitation are identified as ``brand name or 
equal,'' the term is intended to be descriptive not restrictive. The 
``brand name or equal'' description is used to portray the 
characteristics and level of quality that will satisfy the Government's 
needs. The salient physical, functional, and other characteristics which 
``equal'' products must meet are specified in the solicitation.
    (b) To be considered for award, offers of ``equal'' products, 
including products (other than the ``brand name'' item) of the brand 
name manufacturer, must--
    (1) Meet the salient physical, functional, and other characteristics 
specified in this solicitation;
    (2) Clearly identify the item by--
    (i) Brand name, if any; and
    (ii) Make or model number;
    (3) Include descriptive literature such as cuts, illustrations, 
drawings, or a clear reference to previously furnished descriptive data 
or information available to the Contracting Officer; and
    (4) Clearly describe any modifications the Offeror plans to make in 
a product to make it conform to the solicitation requirements. Mark any 
descriptive material to clearly show the modifications.

[[Page 410]]

    (c) The Contracting Officer will evaluate ``equal'' products on the 
basis of information furnished by the Offeror or identified in the offer 
and reasonably available to the Contracting Officer. The Contracting 
Officer is not responsible for locating or securing any information not 
identified in the offer and reasonably available.
    (d) Unless the Offeror clearly indicates in the offer that the 
product being offered is an ``equal'' product, the Contracting Officer 
will consider the offer as offering a brand name product referenced in 
the solicitation.

                           (End of provision)

[56 FR 36479, July 31, 1991. Redesignated and amended at 60 FR 61600, 
Nov. 30, 1995]



252.211-7004  Alternate preservation, packaging, and packing.

    As prescribed in 211.272, use the following provision:

       Alternate Preservation, Packaging, and Packing (Dec. 1991)

    (a) The Offeror may submit two unit prices for each item--one based 
on use of the military preservation, packaging, or packing requirements 
of the solicitation; and an alternate based on use of commercial or 
industrial preservation, packaging, or packing of equal or better 
protection than the military.
    (b) If the Offeror submits two unit prices, the following 
information, as a minimum, shall be submitted with the offer to allow 
evaluation of the alternate--
    (1) The per unit/item cost of commercial or industrial preservation, 
packaging, and packing;
    (2) The per unit/item cost of military preservation, packaging, and 
packing;
    (3) The description of commercial or industrial preservation, 
packaging, and packing procedures, including material specifications, 
when applicable, to include--
    (i) Method of preservation;
    (ii) Quantity per unit package;
    (iii) Cleaning/drying treatment;
    (iv) Preservation treatment;
    (v) Wrapping materials;
    (vi) Cushioning/dunnage material;
    (vii) Thickness of cushioning;
    (viii) Unit container;
    (ix) Unit package gross weight and dimensions;
    (x) Packing; and
    (xi) Packing gross weight and dimensions; and
    (4) Item characteristics, to include--
    (i) Material and finish;
    (ii) Net weight;
    (iii) Net dimensions; and
    (iv) Fragility.
    (c) If the Contracting Officer does not evaluate or accept the 
Offeror's proposed alternate commercial or industrial preservation, 
packaging, or packing, the Offeror agrees to preserve, package, or pack 
in accordance with the specified military requirements.

                           (End of provision)

[56 FR 36479, July 31, 1991. Redesignated and amended at 60 FR 61600, 
Nov. 30, 1995]



252.211-7005  Substitutions for military or Federal specifications and standards.

     As prescribed in 211.273-4, use the following clause:

Substitutions for Military or Federal Specifications and Standards (AUG 
                                  1997)

    (a) Definition. ``SPI process,'' as used in this clause, means a 
management or manufacturing process that has been accepted previously by 
the Department of Defense under the Single Process Initiative (SPI) for 
use in lieu of a specific military or Federal specification or standard. 
Under SPI, these processes are reviewed and accepted by a Management 
Council, which includes representatives from the Defense Contract 
Management Command, the Defense Contract Audit Agency, and the military 
departments.
    (b) Offerors are encouraged to propose SPI processes in lieu of 
military or Federal specifications and standards cited in the 
solicitation.
    (c) An offeror proposing to use an SPI process shall--
    (1) Identify the specific military or Federal specification or 
standard for which the SPI process has been accepted, and the specific 
paragraph or other location in the solicitation where the military or 
Federal specification or standard is required;
    (2) Provide a copy of the Department of Defense acceptance of the 
SPI process;
    (3) Identify each facility at which the offeror proposes to use the 
specific SPI process; and
    (4) Unless provided in response to paragraph (c)(2) of this clause, 
provide the name and telephone number of the cognizant Administrative 
Contracting Officers for each facility where the SPI process is proposed 
for use.
    (d) Absent a determination at the head of the contracting activity 
or program executive officer level that an SPI process is not acceptable 
for this procurement, the Contractor shall use the following SPI 
processes in lieu of military or Federal specifications and standards:

            (Offeror Insert Information for Each SPI Process)

SPI Process:

[[Page 411]]

Facility:
Military or Federal Specification or Standard:
Affected Contract Line Item and Subline Item Number and Requirement 
          Citation:
Cognizant Administrative Contracting Officer:

                             (End of clause)

[62 FR 44224, Aug. 20, 1997]



252.212-7000  Offeror representations and certifications--Commercial items.

    As prescribed in 212.301(f)(ii), use the following provision:

 Offeror Representations and Certifications--Commercial Items (NOV 1995)

    (a) Definitions.
    As used in this clause--
    (1) Foreign person means any person other than a United States 
person as defined in Section 16(2) of the Export Administration Act of 
1979 (50 U.S.C. App. Sec. 2415).
    (2) United States person is defined in Section 16(2) of the Export 
Administration Act of 1979 and means any United States resident or 
national (other than an individual resident outside the United States 
and employed by other than a United States person), any domestic concern 
(including any permanent domestic establishment of any foreign concern), 
and any foreign subsidiary or affiliate (including any permanent foreign 
establishment) of any domestic concern which is controlled in fact by 
such domestic concern, as determined under regulations of the President.
    (b) Certification.
    By submitting this offer, the Offeror, if a foreign person, company 
or entity, certifies that it--
    (1) Does not comply with the Secondary Arab Boycott of Israel; and
    (2) Is not taking or knowingly agreeing to take any action, with 
respect to the Secondary Boycott of Israel by Arab countries, which 50 
U.S.C. App. Sec. 2407(a) prohibits a United States person from taking.
    (c) Representation of Extent of Transportation by Sea. (This 
representation does not apply to solicitations for the direct purchase 
of ocean transportation services).
    (1) The Offeror shall indicate by checking the appropriate blank in 
paragraph (c)(2) of this provision whether transportation of supplies by 
sea is anticipated under the resultant contract. The term ``supplies'' 
is defined in the Transportation of Supplies by Sea clause of this 
solicitation.
    (2) Representation.
    The Offeror represents that it--
    ______ Does anticipate that supplies will be transported by sea in 
the performance of any contract or subcontract resulting from this 
solicitation.
    ______ Does not anticipate that supplies will be transported by sea 
in the performance of any contract or subcontract resulting from this 
solicitation.
    (3) Any contract resulting from this solicitation will include the 
Transportation of Supplies by Sea clause. If the Offeror represents that 
it will not use ocean transportation, the resulting contract will also 
include the Defense Federal Acquisition Regulation Supplement clause at 
252.247-7024, Notification of Transportation of Supplies by Sea.

                           (End of provision)

[60 FR 61600, Nov. 30, 1995, as amended at 61 FR 50455, Sept. 26, 1996]



252.212-7001  Contract terms and conditions required to implement statutes or Executive Orders applicable to Defense acquisitions of commercial items.

    As prescribed in 212.301(f)(iii), use the following clause:

    Contract Terms and Conditions Required to Implement Statutes or 
Executive Orders Applicable to Defense Acquisitions of Commercial Items 
                               (JUL 1997)

    (a) The Contractor agrees to comply with the Defense Federal 
Acquisition Regulation Supplement (DFARS) clause 252.247-7023, 
Transportation of Supplies by Sea, which is included in this contract by 
reference to implement 10 U.S.C. 2631.
    (b) The Contractor agrees to comply with any clause that is checked 
on the following list of DFARS clauses which, if checked, is included in 
this contract by reference to implement provisions of law or Executive 
Orders applicable to acquisitions of commercial items or components.

______ 252.205-7000  Provision of Information to Cooperative Agreement 
          Holders (10 U.S.C. 2416).
______ 252.206-7000  Domestic Source Restriction (10 U.S.C. 2304).
______ 252.219-7001  Notice of Partial Small Business Set-Aside with 
          Preferential Consideration for Small Disadvantaged Business 
          Concerns (____ Alternate I) (Section 9004, Pub. L. 101-165 (10 
          U.S.C. 2301 (repealed) note)).
______ 252.219-7002  Notice of Small Disadvantaged Business Set-Aside 
          (____ Alternate I) (15 U.S.C. 644).
______ 252.219-7003  Small Business and Small Disadvantaged Business 
          Subcontracting Plan (DoD Contracts) (15 U.S.C. 637).

[[Page 412]]

______ 252.219-7005  Incentive for Subcontracting with Small Businesses, 
          Small Disadvantaged Businesses, Historically Black Colleges 
          and Universities and Minority Institutions (____ Alternate I) 
          (Section 9004, Pub. L. 101-165 (10 U.S.C. 2301 (repealed) 
          note)).
______ 252.219-7006  Noice of Evaluation Preference for Small 
          Disadvantaged Business Concerns (____ Alternate I) (15 U.S.C. 
          644).
______ 252.225-7001  Buy American Act and Balance of Payment Program (41 
          U.S.C. 10, E.O. 10582).
______ 252.225-7007  Trade Agreements (10 U.S.C. 2501-2582).
______ 252.225-7012  Preference for Certain Domestic Commodities.
______ 252.225-7014  Preference for Domestic Speciality Metals (10 
          U.S.C. 2241 note).
______ 252.225-7015  Preference for Domestic Hand or Measuring Tools (10 
          U.S.C. 2241 note).
______ 252.225-7027  Restriction on Contingent Fees for Foreign Military 
          Sales (22 U.S.C. 2779).
______ 252.225-7028  Exclusionary Policies and Practices of Foreign 
          Governments (22 U.S.C. 2755).
______ 252.225-7029  Restriction on Acquisition of Air Circuit Breakers 
          (10 U.S.C. 2534(a)(3)).
______ 252.225-7036  North American Free Trade Agreement Implementation 
          Act.
______ 252.227-7015  Technical Data--Commercial Items (10 U.S.C. 2320).
______ 252.227-7037  Validation of Restrictive Markings on Technical 
          Data (10 U.S.C. 2321).
______ 252.242-7002  Submission of Commercial Freight Bills for Audit 
          (31 U.S.C. 3726).
______ 252.243-7002  Certification of Requests for Equitable Adjustment 
          (10 U.S.C. 2410)
______ 252.247-7024  Notification of Transportation of Supplies by Sea 
          (10 U.S.C. 2631).
______ 252.249-7001  Notification of Substantial Impact on Employment 
          (10 U.S.C. 2501 note).
    (c) In addition to the clauses listed in paragraph (e) of the 
Contract Terms and Conditions Required to Implement Statutes or 
Executive Orders-Commercial Items clause of this contract, the 
Contractor shall include the terms of the following clause, if 
applicable, in subcontracts for commercial items or commercial 
components, awarded at any tier under this contract:

    252.225-7014, Preference for Domestic Specialty Metals, Alternate I 
(10 U.S.C. 2241 note).

                             (End of clause)

[60 FR 61601, Nov. 30, 1995, as amended at 61 FR 50455, Sept. 26, 1996; 
61 FR 58489, Nov. 15, 1996; 62 FR 2614, 2617, Jan. 17, 1997; 62 FR 5780, 
Feb. 7, 1997; 62 FR 37147, July 11, 1997]



252.215-7000  Pricing adjustments.

    As prescribed in 215.804-8, use the following clause:

                     Pricing Adjustments (Dec. 1991)

    The term ``pricing adjustment,'' as used in paragraph (a) of the 
clauses entitled ``Price Reduction for Defective Cost or Pricing Data--
Modifications,'' ``Subcontractor Cost or Pricing Data,'' and 
``Subcontractor Cost or Pricing Data--Modifications,'' means the 
aggregate increases and/or decreases in cost plus applicable profits.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 62 FR 40473, July 29, 1997]



252.215-7001  [Reserved]



252.215-7002  Cost estimating system requirements.

    As prescribed in 215.811-70(h), use the following clause:

             Cost Estimating System Requirements (JUL 1997)

    (a) Definition.
    Estimating system means the Contractor's policies, procedures, and 
practices for generating estimates of costs and other data included in 
proposals submitted to customers in the expectation of receiving 
contract awards. Estimating system includes the Contractor's--
    (1) Organizational structure;
    (2) Established lines of authority, duties, and responsibilities;
    (3) Internal controls and managerial reviews;
    (4) Flow of work, coordination, and communication; and
    (5) Estimating methods, techniques, accumulation of historical 
costs, and other analyses used to generate cost estimates.
    (b) General. (1) The Contractor shall establish, maintain, and 
comply with an estimating system that is consistently applied and 
produces reliable, verifiable, supportable, and documented cost 
estimates that are an acceptable basis for negotiation of fair and 
reasonable prices.
    (2) The system should be--

[[Page 413]]

    (i) Consistent and integrated with the Contractor's related 
management systems; and
    (ii) Subject to applicable financial control systems.
    (c) Applicability. Paragraphs (d) and (e) of this clause apply if 
the contractor is a large business and either--
    (1) In its fiscal year preceding award of this contract, received 
Department of Defense (DoD) prime contracts or subcontracts, totaling 
$50 million or more for which cost or pricing data were required; or
    (2) In its fiscal year preceding award of this contract--
    (i) Received DoD prime contracts or subcontracts totaling $10 
million or more (but less than $50 million) for which cost or pricing 
data were required; and
    (ii) Was notified in writing by the Contracting Officer that 
paragraphs (d) and (e) of this clause apply.
    (d) System requirements. (1) The Contractor shall disclose its 
estimating system to the Administrative Contracting Officer (ACO) in 
writing. If the Contractor wishes the Government to protect the 
information as privileged or confidential, the Contractor must mark the 
documents with the appropriate legends before submission.
    (2) An estimating system disclosure is adequate when the Contractor 
has provided the ACO with documentation which--
    (i) Accurately describes those policies, procedures, and practices 
that the Contractor currently uses in preparing cost proposals; and
    (ii) Provides sufficient detail for the Government to reasonably 
make an informed judgment regarding the adequacy of the contractor's 
estimating practices.
    (3) The Contractor shall--
    (i) Comply with its disclosed estimating system; and
    (ii) Disclose significant changes to the cost estimating system to 
the ACO on a timely basis.
    (e) Estimating system deficiencies. (1) The Contractor shall respond 
to a written report from the Government which identifies deficiencies in 
the Contractor's estimating system as follows:
    (i) If the Contractor agrees with the report findings and 
recommendations, the Contractor shall--
    (A) Within 30 days, state its agreement in writing; and
    (B) Within 60 days, correct the deficiencies or submit a corrective 
action plan showing proposed milestones and actions leading to 
elimination of the deficiencies.
    (ii) If the Contractor disagrees with the report, the Contractor 
shall, within 30 days, state its rationale for disagreeing.
    (2) The ACO will evaluate the Contractor's response and notify the 
Contractor of the determination concerning remaining deficiencies and/or 
the adequacy of any proposed or completed corrective action.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 62 FR 40473, July 29, 1997]



252.216-7000  Economic price adjustment--basic steel, aluminum, brass, bronze, or copper mill products.

    As prescribed in 216.203-4-70(a), use the following clause:

  Economic Price Adjustment--Basic Steel, Aluminum, Brass, Bronze, or 
                     Copper Mill Products (Jul 1997)

    (a) Definitions.
    As used in this clause--
    Established price means a price which is an established catalog or 
market price for a commercial item sold in substantial quantities to the 
general public.
    Unit price excludes any part of the price which reflects 
requirements for preservation, packaging, and packing beyond standard 
commercial practice.
    (b) The Contractor warrants that the unit price stated for (Identify 
the item) is not in excess of the Contractor's established price in 
effect on the date set for opening of bids (or the contract date if this 
is a negotiated contract) for like quantities of the same item. This 
price is the net price after applying any applicable standard trade 
discounts offered by the Contractor from its catalog, list, or schedule 
price.
    (c) The Contractor shall promptly notify the Contracting Officer of 
the amount and effective date of each decrease in any established price.
    (1) Each corresponding contract unit price shall be decreased by the 
same percentage that the established price is decreased.
    (2) This decrease shall apply to items delivered on or after the 
effective date of the decrease in the Contractor's established price.
    (3) This contract shall be modified accordingly.
    (d) If the Contractor's established price is increased after the 
date set for opening of bids (or the contract date if this is a 
negotiated contract), upon the Contractor's written request to the 
Contracting Officer, the corresponding contract unit price shall be 
increased by the same percentage that the established price is 
increased, and this contract shall be modified accordingly, provided--
    (1) The aggregate of the increases in any contract unit price under 
this contract shall not exceed 10 percent of the original contract unit 
price;
    (2) The increased contract unit price shall be effective on the 
effective date of the increase in the applicable established price if

[[Page 414]]

the Contractor's written request is received by the Contracting Officer 
within ten days of the change. If it is not, the effective date of the 
increased unit price shall be the date of receipt of the request by the 
Contracting Officer; and
    (3) The increased contract unit price shall not apply to quantities 
scheduled for delivery before the effective date of the increased 
contract unit price unless the Contractor's failure to deliver before 
that date results from causes beyond the control and without the fault 
or negligence of the Contractor, within the meaning of the Default 
clause of this contract.
    (4) The Contracting Officer shall not execute a modification 
incorporating an increase in a contract unit price under this clause 
until the increase is verified.
    (e) Within 30 days after receipt of the Contractor's written 
request, the Contracting Officer may cancel, without liability to either 
party, any portion of the contract affected by the requested increase 
and not delivered at the time of such cancellation, except as follows--
    (1) The Contractor may, after that time, deliver any items that were 
completed or in the process of manufacture at the time of receipt of the 
cancellation notice, provided the Contractor notifies the Contracting 
Officer of such items within 10 days after the Contractor receives the 
cancellation notice.
    (2) The Government shall pay for those items at the contract unit 
price increased to the extent provided by paragraph (d) of this clause.
    (3) Any standard steel supply item shall be deemed to be in the 
process of manufacture when the steel for that item is in the state of 
processing after the beginning of the furnace melt.
    (f) Pending any cancellation of this contract under paragraph (e) of 
this clause, or if there is no cancellation, the Contractor shall 
continue deliveries according to the delivery schedule of the contract. 
The Contractor shall be paid for those deliveries at the contract unit 
price increased to the extent provided by paragraph (d) of this clause.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 62 FR 2614, Jan. 17, 1997; 62 
FR 40473, July 29, 1997]



252.216-7001  Economic price adjustment--nonstandard steel items.

    As prescribed in 216.203-4-70(b), use the following clause:

      Economic Price Adjustment--Nonstandard Steel Items (Jul 1997)

    (a) Definitions.
    As used in this clause--
    Base labor index means the average of the labor indices for the 
three months which consist of the month of bid opening (or offer 
submission) and the months immediately preceding and following that 
month.
    Base steel index means the Contractor's established price (see note 
6) including all applicable extras of $________ per __________ (see note 
1) for __________ (see note 2) on the date set for bid opening (or the 
date of submission of the offer).
    Current labor index means the average of the labor indices for the 
month in which delivery of supplies is required to be made and the month 
preceding.
    Current steel index means the Contractor's established price (see 
note 6) for that item, including all applicable extras in effect 
________ days (see note 3) prior to the first day of the month in which 
delivery is required.
    Established price is--
    (1) A price which is an established catalog or market price of a 
commercial item sold in substantial quantities to the general public; 
and
    (2) The net price after applying any applicable standard trade 
discounts offered by the Contractor from its catalog, list, or schedule 
price. (But see Note 6.)
    Labor index means the average straight time hourly earnings of the 
Contractor's employees in the ________ shop of the Contractor's 
__________ plant (see note 4) for any particular month.
    Month means calendar month. However, if the Contractor's accounting 
period does not coincide with the calendar month, then that accounting 
period shall be used in lieu of month.
    (b) Each contract unit price shall be subject to revision, under the 
terms of this clause, to reflect changes in the cost of labor and steel. 
For purpose of this price revision, the proportion of the contract unit 
price attributable to costs of labor not otherwise included in the price 
of the steel item identified under the base steel index definition in 
paragraph (a) shall be ______ percent, and the proportion of the 
contract unit price attributable to the cost of steel shall be ______ 
percent. (See note 5.)
    (c)(1) Unless otherwise specified in this contract, the labor index 
shall be computed by dividing the total straight time earnings of the 
Contractor's employees in the shop identified in paragraph (a) for any 
given month by the total number of straight time hours worked by those 
employees in that month.
    (2) Any revision in a contract unit price to reflect changes in the 
cost of labor shall be computed solely by reference to the ``base labor 
index'' and the ``current labor index.''
    (d) Any revision in a contract unit price to reflect changes in the 
cost of steel shall be

[[Page 415]]

computed solely by reference to the ``base steel index'' and the 
``current steel index.''
    (e)(1) Each contract unit price shall be revised for each month in 
which delivery of supplies is required to be made.
    (2) The revised contract unit price shall apply to the deliveries of 
those quantities required to be made in that month regardless of when 
actual delivery is made.
    (3) Each revised contract unit price shall be computed by adding--
    (i) The adjusted cost of labor (obtained by multiplying ______ 
percent of the contract unit price by a fraction, of which the numerator 
shall be the current labor index and the denominator shall be the base 
labor index);
    (ii) The adjusted cost of steel (obtained by multiplying ______ 
percent of the contract unit price by a fraction, of which the numerator 
shall be the current steel index and the denominator shall be the base 
steel index); and
    (iii) The amount equal to ______ percent of the original contract 
unit price (representing that portion of the unit price which relates 
neither to the cost of labor nor the cost of steel, and which is 
therefore not subject to revision (see note 5)).
    (4) The aggregate of the increases in any contract unit price under 
this contract shall not exceed ten percent of the original contract unit 
price.
    (5) Computations shall be made to the nearest one-hundredth of one 
cent.
    (f)(1) Pending any revisions of the contract unit prices, the 
Contractor shall be paid the contract unit price for deliveries made.
    (2) Within 30 days after final delivery (or such other period as may 
be authorized by the Contracting Officer), the Contractor shall furnish 
a statement identifying the correctness of--
    (i) The average straight time hourly earnings of the Contractor's 
employees in the shop identified in paragraph (a) that are relevant to 
the computations of the base labor index and the current labor index; 
and
    (ii) The Contractor's established prices (see note 6), including all 
applicable extras for like quantities of the item that are relevant to 
the computation of the base steel index and the current steel index.
    (3) Upon request of the Contracting Officer, the Contractor shall 
make available all records used in the computation of the labor indices.
    (4) Upon receipt of the statement, the Contracting Officer will 
compute the revised contract unit prices and modify the contract 
accordingly. No modification to this contract will be made pursuant to 
this clause until the Contracting Officer has verified the revised 
established price (see note 6).
    (g)(1) In the event any item of this contract is subject to a total 
or partial termination for convenience, the month in which the 
Contractor receives notice of the termination, if prior to the month in 
which delivery is required, shall be considered the month in which 
delivery of the terminated item is required for the purposes of 
determining the current labor and steel indices under paragraphs (c) and 
(d).
    (2) For any item which is not terminated for convenience, the month 
in which delivery is required under the contract shall continue to apply 
for determining those indices with respect to the quantity of the non-
terminated item.
    (3) If this contract is terminated for default, any price revision 
shall be limited to the quantity of the item which has been delivered by 
the Contractor and accepted by the Government prior to receipt by the 
Contractor of the notice of termination.
    (h) If the Contractor's failure to make delivery of any required 
quantity arises out of causes beyond the control and without the fault 
or negligence of the Contractor, within the meaning of the clause of 
this contract entitled ``Default,'' the quantity not delivered shall be 
delivered as promptly as possible after the cessation of the cause of 
the failure, and the delivery schedule set forth in this contract shall 
be amended accordingly.
    Notes:
    1 Offeror insert the unit price and unit measure of the standard 
steel mill item to be used in the manufacture of the contract item.
    2 Offeror identify the standard steel mill item to be used in the 
manufacture of the contract item.
    3 Offeror insert best estimate of the number of days required for 
processing the standard steel mill item in the shop identified under the 
labor index definition.
    4 Offeror identify the shop and plant in which the standard steel 
mill item identified under the base steel index definition will be 
finally fabricated or processed into the contract item.
    5 Offeror insert the same percentage figures for the corresponding 
blanks in paragraphs (b), (e)(3)(i), and (e)(3)(ii). In paragraph 
(e)(3)(iii), insert the percentage representing the difference between 
the sum of the percentages inserted in paragraph (b) and 100 percent.
    6 In negotiated acquisitions of nonstandard steel items, when there 
is no established price or when it is not desirable to use this price, 
this paragraph may refer to another appropriate price basis, e.g., an 
established interplant price.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 62 FR 2614, Jan. 17, 1997; 62 
FR 40473, July 29, 1997]

[[Page 416]]



252.216-7002  [Reserved]



252.216-7003  Economic price adjustment--wage rates or material prices controlled by a foreign government.

    As prescribed in 216.203-4-70(c), use the following clause:

Economic Price Adjustment--Wage Rates or Material Prices Controlled by a 
                     Foreign Government (JUNE 1997)

    (a) The Contractor represents that the prices set forth in this 
contract--
    (1) Are based on the wage rate(s) or material price(s) established 
and controlled by the Government of________(Offeror insert name of host 
country); and
    (2) Do not include contingency allowances to pay for possible 
increases in wage rates or material prices.
    (b) If wage rates or material prices are revised by the government 
named in paragraph (a) of this clause, the Contracting Officer shall 
make an equitable adjustment in the contract price and shall modify the 
contract to the extent that the Contractor's actual costs of performing 
this contract are increased or decreased, as a direct result of the 
revision, subject to the following:
    (1) For increases in established wage rates or material prices, the 
increase in contract unit price(s) shall be effective on the same date 
that the government named in paragraph (a) of this clause increased the 
applicable wage rate(s) or material price(s), but only if the 
Contracting Officer receives the Contractor's written request for 
contract adjustment within 10 days of the change. If the Contractor's 
request is received later, the effective date shall be the date that the 
Contracting Officer received the Contractor's request.
    (2) For decreases in established wage rates or material prices, the 
decrease in contract unit price(s) shall be effective on the same date 
that the government named in paragraph (a) of this clause decreased the 
applicable wage rate(s) or material price(s). The decrease in contract 
unit price(s) shall apply to all items delivered on and after the 
effective date of the government's rate or price decrease.
    (c) No modification changing the contract unit price(s) shall be 
executed until the Contracting Officer has verified the applicable 
change in the rates or prices set by the government named in paragraph 
(a) of this clause. The Contractor shall make available its books and 
records that support a requested change in contract price.
    (d) Failure to agree to any adjustment shall be a dispute under the 
Disputes clause of this contract.

                             (End of clause)

[62 FR 34128, June 24, 1997]



252.217-7000  Exercise of option to fulfill foreign military sales commitments.

    As prescribed in 217.208-70(a), use the following clause:

 Exercise of Option To Fulfill Foreign Military Sales Commitments (Dec. 
                                  1991)

    (a) The Government may exercise the option(s) of this contract to 
fulfill foreign military sales commitments.
    (b) The foreign military sales commitments are for:
 _______________________________________________________________________
(Insert name of country, or To Be Determined)
 _______________________________________________________________________
(Insert applicable CLIN)

                             (End of clause)

                         Alternate I (Dec. 1991)

    As prescribed in 217.208-70(a)(1), substitute the following 
paragraph (b) for paragraph (b) of the basic clause:
    (b) On the date the option is exercised, the Government shall 
identify the foreign country for the purpose of negotiating any 
equitable adjustment attributable to foreign military sales. Failure to 
agree on an equitable adjustment shall be treated as a dispute under the 
Disputes clause of this contract.



252.217-7001  Surge option.

    As prescribed in 217.208-70(b), use the following clause:

                        Surge Option (Aug. 1992)

    (a) General. The Government has the option to--
    (1) Increase the quantity of supplies or services called for under 
this contract by no more than ______ percent; and/or
    (2) Accelerate the rate of delivery called for under this contract, 
at a price or cost established before contract award or to be 
established by negotiation as provided in this clause.
    (b) Schedule. (1) When the Production Surge Plan (DI-MGMT-80969) is 
included in the contract, the option delivery schedule shall be the 
production rate provided with the Plan. If the Plan was negotiated 
before contract award, then the negotiated schedule shall be used.
    (2) If there is no Production Surge Plan in the contract, the 
Contractor shall, within 30 days from the date of award, furnish the 
Contracting Officer a delivery schedule

[[Page 417]]

showing the maximum sustainable rate of delivery for items in this 
contract. This delivery schedule shall provide acceleration by month up 
to the maximum sustainable rate of delivery achievable within the 
Contractor's existing facilities, equipment, and subcontracting 
structure.
    (3) The Contractor shall not revise the option delivery schedule 
without approval from the Contracting Officer.
    (c) Exercise of option. (1) The Contracting Officer may exercise 
this option at any time before acceptance by the Government of the final 
scheduled delivery.
    (2) The Contracting Officer will provide a preliminary oral or 
written notice to the Contractor stating the quantities to be added or 
accelerated under the terms of this clause, followed by a contract 
modification incorporating the transmitted information and instructions. 
The notice and modification will establish a not-to-exceed price equal 
to the highest contract unit price or cost of the added or accelerated 
items as of the date of the notice.
    (3) The Contractor will not be required to deliver at a rate greater 
than the maximum sustainable delivery rate under paragraph (b)(2) of 
this clause, nor will the exercise of this option extend delivery more 
than 24 months beyond the scheduled final delivery.
    (d) Price negotiation. (1) Unless the option cost or price was 
previously agreed upon, the Contractor shall, within 30 days from the 
date of option exercise, submit to the Contracting Officer a cost or 
price proposal (including a cost breakdown) for the added or accelerated 
items.
    (2) Failure to agree on a cost or price in negotiations resulting 
from the exercise of this option shall constitute a dispute concerning a 
question of fact within the meaning of the Disputes clause of this 
contract. However, nothing in this clause shall excuse the Contractor 
from proceeding with the performance of the contract, as modified, while 
any resulting claim is being settled.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 57 FR 42633, Sept. 15, 1992]



252.217-7002  Offering property for exchange.

    As prescribed in 217.7005, use the following provision:

               Offering Property for Exchange (Dec. 1991)

    (a) The property described in item number ________, is being offered 
in accordance with the exchange provisions of section 201(c) of the 
Federal Property and Administrative Services Act of 1949, 63 Stat. 384 
(40 U.S.C. 481(c)).
    (b) The property is located at (insert address). Offerors may 
inspect the property during the period (insert beginning and ending 
dates and insert hours during day).

                           (End of provision)



252.217-7003  Changes.

    As prescribed in 217.7104(a), use the following clause:

                           Changes (Dec. 1991)

    (a) The Contracting Officer may, at any time and without notice to 
the sureties, by written change order, make changes within the general 
scope of any job order issued under the Master Agreement in--
    (1) Drawings, designs, plans, and specifications;
    (2) Work itemized;
    (3) Place of performance of the work;
    (4) Time of commencement or completion of the work; and
    (5) Any other requirement of the job order.
    (b) If a change causes an increase or decrease in the cost of, or 
time required for, performance of the job order, whether or not changed 
by the order, the Contracting Officer shall make an equitable adjustment 
in the price or date of completion, or both, and shall modify the job 
order in writing.
    (1) Within ten days after the Contractor receives notification of 
the change, the Contractor shall submit to the Contracting Officer a 
request for price adjustment, together with a written estimate of the 
increased cost.
    (2) The Contracting Officer may grant an extension of this period if 
the Contractor requests it within the ten day period.
    (3) If the circumstances justify it, the Contracting Officer may 
accept and grant a request for equitable adjustment at any later time 
prior to final payment under the job order, except that the Contractor 
may not receive profit on a payment under a late request.
    (c) If the Contractor includes in its claim the cost of property 
made obsolete or excess as a result of a change, the Contracting Officer 
shall have the right to prescribe the manner of disposition of that 
property.
    (d) Failure to agree to any adjustment shall be a dispute within the 
meaning of the Disputes clause.
    (e) Nothing in this clause shall excuse the Contractor from 
proceeding with the job order as changed.

                             (End of clause)



252.217-7004  Job orders and compensation.

    As prescribed in 217.7104(a), use the following clause:

[[Page 418]]

                 Job Orders and Compensation (Dec. 1991)

    (a) The Contracting Officer shall solicit bids or proposals and make 
award of job orders in accordance with FAR part 14 or 15, as applicable. 
The issuance of a job order signed by the Contracting Officer 
constitutes award. The job order shall incorporate the terms and 
conditions of the Master Agreement.
    (b) Whenever the Contracting Officer determines that a vessel, its 
cargo or stores, would be endangered by delay, or whenever the 
Contracting Officer determines that military necessity requires that 
immediate work on a vessel is necessary, the Contracting Officer may 
issue a written order to perform that work and the Contractor hereby 
agrees to comply with that order and to perform work on such vessel 
within its capabilities.
    (1) As soon as practicable after the issuance of the order, the 
Contracting Officer and the Contractor shall negotiate a price for the 
work and the Contracting Officer shall issue a job order covering the 
work.
    (2) The Contractor shall, upon request, furnish the Contracting 
Officer with a breakdown of costs incurred by the Contractor and an 
estimate of costs expected to be incurred in the performance of the 
work. The Contractor shall maintain, and make available for inspection 
by the Contracting Officer or the Contracting Officer's representative, 
records supporting the cost of performing the work.
    (3) Failure of the parties to agree upon the price of the work shall 
constitute a dispute within the meaning of the Disputes clause of the 
Master Agreement. In the meantime, the Contractor shall diligently 
proceed to perform the work ordered.
    (c)(1) If the nature of any repairs is such that their extent and 
probable cost cannot be ascertained readily, the Contracting Officer may 
issue a job order (on a sealed bid or negotiated basis) to determine the 
nature and extent of required repairs.
    (2) Upon determination by the Contracting Officer of what work is 
necessary, the Contractor, if requested by the Contracting Officer, 
shall negotiate prices for performance of that work. The prices agreed 
upon shall be set forth in a modification of the job order.
    (3) Failure of the parties to agree upon the price shall constitute 
a dispute under the Disputes clause. In the meantime, the Contractor 
shall diligently proceed to perform the work ordered.

                             (End of clause)



252.217-7005  Inspection and manner of doing work.

    As prescribed in 217.7104(a), use the following clause:

             Inspection and Manner of Doing Work (JAN 1997)

    (a) The Contractor shall perform work in accordance with the job 
order, any drawings and specifications made a part of the job order, and 
any change or modification issued under the Changes clause of the Master 
Agreement.
    (b)(1) Except as provided in paragraph (b) (2) of this clause, and 
unless otherwise specifically provided in the job order, all operational 
practices of the Contractor and all workmanship, material, equipment, 
and articles used in the performance of work under the Master Agreement 
shall be in accordance with the best commercial marine practices and the 
rules and requirements of the American Bureau of Shipping, the U.S. 
Coast Guard, and the Institute of Electrical and Electronic Engineers, 
in effect at the time of Contractor's submission of bid (or acceptance 
of the job order, if negotiated).
    (2) When Navy specifications are specified in the job order, the 
Contractor shall follow Navy standards of material and workmanship. The 
solicitation shall prescribe the Navy standard whenever applicable.
    (c) The Government may inspect and test all material and workmanship 
at any time during the Contractor's performance of the work.
    (1) If, prior to delivery, the Government finds any material or 
workmanship is defective or not in accordance with the job order, in 
addition to its rights under the Guarantees clause of the Master 
Agreement, the Government may reject the defective or nonconforming 
material or workmanship and require the Contractor to correct or replace 
it at the Contractor's expense.
    (2) If the Contractor fails to proceed promptly with the replacement 
or correction of the material or workmanship, the Government may replace 
or correct the defective or nonconforming material or workmanship and 
charge the Contractor the excess costs incurred.
    (3) As specified in the job order, the Contractor shall provide and 
maintain an inspection system acceptable to the Government.
    (4) The Contractor shall maintain complete records of all inspection 
work and shall make them available to the Government during performance 
of the job order and for 90 days after the completion of all work 
required.
    (d) The Contractor shall not permit any welder to work on a vessel 
unless the welder is, at the time of the work, qualified to the 
standards established by the U.S. Coast Guard, American Bureau of 
Shipping, or Department of the Navy for the type of welding being 
performed. Qualifications of a welder shall be as specified in the job 
order.
    (e) The Contractor shall--

[[Page 419]]

    (1) Exercise reasonable care to protect the vessel from fire;
    (2) Maintain a reasonable system of inspection over activities 
taking place in the vicinity of the vessel's magazines, fuel oil tanks, 
or storerooms containing flammable materials;
    (3) Maintain a reasonable number of hose lines ready for immediate 
use on the vessel at all times while the vessel is berthed alongside the 
Contractor's pier or in dry dock or on a marine railway;
    (4) Unless otherwise provided in a job order, provide sufficient 
security patrols to reasonably maintain a fire watch for protection of 
the vessel when it is in the Contractor's custody;
    (5) To the extent necessary, clean, wash, and steam out or otherwise 
make safe, all tanks under alteration or repair;
    (6) Furnish the Contracting Officer or designated representative 
with a copy of the ``gas-free'' or ``safe-for-hotwork'' certificate, 
provided by a Marine Chemist or Coast Guard authorized person in 
accordance with Occupational Safety and Health Administration 
regulations (29 CFR 1915.14) before any hot work is done on a tank;
    (7) Treat the contents of any tank as Government property in 
accordance with the Government Property (Fixed-Price Contracts) clause; 
and
    (8) Dispose of the contents of any tank only at the direction, or 
with the concurrence, of the Contracting Officer.
    (f) Except as otherwise provided in the job order, when the vessel 
is in the custody of the Contractor or in dry dock or on a marine 
railway and the temperature is expected to go as low as 35  deg.F, the 
Contractor shall take all necessary steps to--
    (1) Keep all hose pipe lines, fixtures, traps, tanks, and other 
receptacles on the vessel from freezing; and
    (2) Protect the stern tube and propeller hubs from frost damage.
    (g) The Contractor shall, whenever practicable--
    (1) Perform the required work in a manner that will not interfere 
with the berthing and messing of Government personnel attached to the 
vessel; and
    (2) Provide Government personnel attached to the vessel access to 
the vessel at all times.
    (h) Government personnel attached to the vessel shall not interfere 
with the Contractor's work or workers.
    (i)(1) The Government does not guarantee the correctness of the 
dimensions, sizes, and shapes set forth in any job order, sketches, 
drawings, plans, or specifications prepared or furnished by the 
Government, unless the job order requires that the Contractor perform 
the work prior to any opportunity to inspect.
    (2) Except as stated in paragraph (i)(1) of this clause, and other 
than those parts furnished by the Government, the Contractor shall be 
responsible for the correctness of the dimensions, sizes, and shapes of 
parts furnished under this agreement.
    (j) The Contractor shall at all times keep the site of the work on 
the vessel free from accumulation of waste material or rubbish caused by 
its employees or the work. At the completion of the work, unless the job 
order specifies otherwise, the Contractor shall remove all rubbish from 
the site of the work and leave the immediate vicinity of the work area 
``broom clean.''

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 62 FR 2614, Jan. 17, 1997]



252.217-7006  Title.

    As prescribed in 217.7104(a), use the following clause:

                            Title (Dec. 1991)

    (a) Unless otherwise provided, title to all materials and equipment 
to be incorporated in a vessel in the performance of a job order shall 
vest in the Government upon delivery at the location specified for the 
performance of the work.
    (b) Upon completion of the job order, or with the approval of the 
Contracting Officer during performance of the job order, all Contractor-
furnished materials and equipment not incorporated in, or placed on, any 
vessel, shall become the property of the Contractor, unless the 
Government has reimbursed the Contractor for the cost of the materials 
and equipment.
    (c) The vessel, its equipment, movable stores, cargo, or other 
ship's materials shall not be considered Government-furnished property.

                             (End of clause)



252.217-7007  Payments.

    As prescribed in 217.7104(a), use the following clause:

                          Payments (Dec. 1991)

    (a) Progress payments, as used in this clause, means payments made 
before completion of work in progress under a job order.
    (b) Upon submission by the Contractor of invoices in the form and 
number of copies directed by the Contracting Officer, and as approved by 
the Contracting Officer, the Government will make progress payments as 
work progresses under the job order.
    (1) Generally, the Contractor may submit invoices on a semi-monthly 
basis, unless expenditures justify a more frequent submission.

[[Page 420]]

    (2) The Government need not make progress payments for invoices 
aggregating less than $5,000.
    (3) The Contracting Officer shall approve progress payments based on 
the value, computed on the price of the job order, of labor and 
materials incorporated in the work, materials suitably stored at the 
site of the work, and preparatory work completed, less the aggregate of 
any previous payments.
    (4) Upon request, the Contractor will furnish the Contracting 
Officer any reports concerning expenditures on the work to date that the 
Contracting Officer may require.
    (c) The Government will retain until final completion and acceptance 
of all work covered by the job order, an amount estimated or approved by 
the Contracting Officer under paragraph (b) of this clause. The amount 
retained will be in accordance with the rate authorized by Congress for 
Naval vessel repair contracts at the time of job order award.
    (d) The Contracting Officer may direct that progress payments be 
based on the price of the job order as adjusted as a result of change 
orders under the Changes clause of the Master Agreement. If the 
Contracting Officer does not so direct--
    (1) Payments of any increases shall be made from time to time after 
the amount of the increase is determined under the Changes clause of the 
Master Agreement; and
    (2) Reductions resulting from decreases shall be made for the 
purposes of subsequent progress payments as soon as the amounts are 
determined under the Changes clause of the Master Agreement.
    (e) Upon completion of the work under a job order and final 
inspection and acceptance, and upon submission of invoices in such form 
and with such copies as the Contracting Officer may prescribe, the 
Contractor shall be paid for the price of the job order, as adjusted 
pursuant to the Changes clause of the Master Agreement, less any 
performance reserves deemed necessary by the Contracting Officer, and 
less the amount of any previous payments.
    (f) All materials, equipment, or any other property or work in 
process covered by the progress payments made by the Government, upon 
the making of those progress payments, shall become the sole property of 
the Government, and are subject to the provisions of the Title clause of 
the Master Agreement.

                             (End of clause)



252.217-7008  Bonds.

    As prescribed in 217.7104(a), use the following clause:

                            Bonds (Dec. 1991)

    (a) If the solicitation requires an offeror to submit a bid bond, 
the Offeror may furnish, instead, an annual bid bond (or evidence 
thereof) or an annual performance and payment bond (or evidence 
thereof).
    (b) If the solicitation does not require a bid bond, the Offeror 
shall not include in the price any contingency to cover the premium of 
such a bond.
    (c) Even if the solicitation does not require bonds, the Contracting 
Officer may nevertheless require a performance and payment bond, in 
form, amount, and with a surety acceptable to the Contracting Officer. 
Where performance and payment bond is required, the offer price shall be 
increased upon the award of the job order in an amount not to exceed the 
premium of a corporate surety bond.
    (d) If any surety upon any bond furnished in connection with a job 
order under this agreement fails to submit requested reports as to its 
financial condition or otherwise becomes unacceptable to the Government, 
the Contracting Officer may require the Contractor to furnish whatever 
additional security the Contracting Officer determines necessary to 
protect the interests of the Government and of persons supplying labor 
or materials in the performance of the work contemplated under the 
Master Agreement.

                             (End of clause)



252.217-7009  Default.

    As prescribed in 217.7104(a), use the following clause:

                           Default (Dec. 1991)

    (a) The Government may, subject to the provisions of paragraph (b) 
of this clause, by written notice of default to the Contractor, 
terminate the whole or any part of a job order if the Contractor fails 
to--
    (1) Make delivery of the supplies or to perform the services within 
the time specified in a job order or any extension;
    (2) Make progress, so as to endanger performance of the job order; 
or
    (3) Perform any of the other provisions of this agreement or a job 
order.
    (b) Except for defaults of subcontractors, the Contractor shall not 
be liable for any excess costs if failure to perform the job order 
arises from causes beyond the control and without the fault or 
negligence of the Contractor. Examples of such causes include acts of 
God or of the public enemy, acts of the Government in either its 
sovereign or contractual capacity, fires, floods, epidemics, quarantine 
restrictions, strikes, freight embargoes, and unusually severe weather.

[[Page 421]]

    (c) If the Contractor's failure to perform is caused by the default 
of a subcontractor, and if such default arises out of causes beyond the 
control of both the Contractor and subcontractor, and without the fault 
or negligence of either, the Contractor shall not be liable for any 
excess costs for failure to perform, unless the supplies or services to 
be furnished by the subcontractor were obtainable from other sources in 
sufficient time to permit the Contractor to perform the job order within 
the time specified.
    (d) If the Government terminates the job order in whole or in part 
as provided in paragraph (a) of this clause--
    (1) The Government may, upon such terms and in such manner as the 
Contracting Officer may deem appropriate, arrange for the completion of 
the work so terminated, at such plant or plants, including that of the 
Contractor, as may be designated by the Contracting Officer.
    (i) The Contractor shall continue the performance of the job order 
to the extent not terminated under the provisions of this clause.
    (ii) If the work is to be completed at the plant, the Government may 
use all tools, machinery, facilities, and equipment of the Contractor 
determined by the Contracting Office to be necessary for that purpose.
    (iii) If the cost to the Government of the work procured or 
completed (after adjusting such cost to exclude the effect of changes in 
the plans and specifications made subsequent to the date of termination) 
exceeds the price fixed for work under the job order (after adjusting 
such price on account of changes in the plans and specifications made 
before the date of termination), the Contractor, or the Contractor's 
surety, if any, shall be liable for such excess.
    (2) The Government, in addition to any other rights provided in this 
clause, may require the Contractor to transfer title and delivery to the 
Government, in the manner and to the extent directed by the Contracting 
Officer, any completed supplies and such partially completed supplies 
and materials, parts, tools, dies, jigs, fixtures, plans, drawings, 
information and contract rights (hereinafter called ``manufacturing 
materials'') as the Contractor has specifically produced or specifically 
acquired for the performance of the terminated part of the job order.
    (i) The Contractor shall, upon direction of the Contracting Officer, 
protect and preserve property in possession of the Contractor in which 
the Government has an interest.
    (ii) The Government shall pay to the Contractor the job order price 
for completed items of work delivered to and accepted by the Government, 
and the amount agreed upon by the Contractor and the Contracting Officer 
for manufacturing materials delivered to and accepted by the Government, 
and for the protection and preservation of property. Failure to agree 
shall be a dispute concerning a question of fact within the meaning of 
the Disputes clause.
    (e) If, after notice of termination of the job order, it is 
determined that the Contractor was not in default, or that the default 
was excusable, the rights and obligations of the parties shall be the 
same as if the notice of termination had been issued for the convenience 
of the Government.
    (f) If the Contractor fails to complete the performance of a job 
order within the time specified, or any extension, the actual damage to 
the Government for the delay will be difficult or impossible to 
determine.
    (1) In lieu of actual damage, the Contractor shall pay to the 
Government as fixed, agreed, and liquidated damages for each calendar 
day of delay the amount, if any, set forth in the job order (prorated to 
the nearest hour for fractional days).
    (2) If the Government terminates the job order, the Contractor shall 
be liable, in addition to the excess costs provided in paragraph (d) of 
this clause, for liquidated damages accruing until such time as the 
Government may reasonably obtain completion of the work.
    (3) The Contractor shall not be charged with liquidated damages when 
the delay arises out of causes beyond the control and without the fault 
or negligence of the Contractor. Subject to the provisions of the 
Disputes clause of the Master Agreement, the Contracting Officer shall 
ascertain the facts and the extent of the delay and shall extend the 
time for performance when in the judgment of the Contracting Officer, 
the findings of fact justify an extension.
    (g) The rights and remedies of the Government provided in this 
clause shall not be exclusive and are in addition to any other rights 
and remedies provided by law under this agreement.

                             (End of clause)



252.217-7010  Performance.

    As prescribed in 217.7104(a), use the following clause:

                         Performance (Dec. 1991)

    (a) Upon the award of a job order, the Contractor shall promptly 
start the work specified and shall diligently prosecute the work to 
completion. The Contractor shall not start work until the job order has 
been awarded except in the case of emergency work ordered by the 
Contracting Officer under the Job Orders and Compensation clause of the 
Master Agreement.
    (b) The Government shall deliver the vessel described in the job 
order at the time and location specified in the job order. Upon 
completion of the work, the Government shall

[[Page 422]]

accept delivery of the vessel at the time and location specified in the 
job order.
    (c) The Contractor shall, without charge and without specific 
requirement in a job order,--
    (1) Make available at the plant to personnel of the vessel while in 
dry dock or on a marine railway, sanitary lavatory and similar 
facilities acceptable to the Contracting Officer;
    (2) Supply and maintain suitable brows and gangways from the pier, 
dry dock, or marine railway to the vessel;
    (3) Treat salvage, scrap or other ship's material of the Government 
resulting from performance of the work as items of Government-furnished 
property, in accordance with the Government Property (Fixed Price 
Contracts) clause;
    (4) Perform, or pay the cost of, any repair, reconditioning or 
replacement made necessary as the result of the use by the Contractor of 
any of the vessel's machinery, equipment or fittings, including, but not 
limited to, winches, pumps, rigging, or pipe lines; and
    (5) Furnish suitable offices, office equipment and telephones at or 
near the site of the work for the Government's use.
    (d) The job order will state whether dock and sea trials are 
required to determine whether or not the Contractor has satisfactorily 
performed the work.
    (1) If dock and sea trials are required, the vessel shall be under 
the control of the vessel's commander and crew.
    (2) The Contractor shall not conduct dock and sea trials not 
specified in the job order without advance approval of the Contracting 
Officer. Dock and sea trials not specified in the job order shall be at 
the Contractor's expense and risk.
    (3) The Contractor shall provide and install all fittings and 
appliances necessary for dock and sea trials. The Contractor shall be 
responsible for care, installation, and removal of instruments and 
apparatus furnished by the Government for use in the trials.

                             (End of clause)



252.217-7011  Access to vessel.

    As prescribed at 217.7104(a), use the following clause:

                      Access to Vessel (Dec. 1991)

    (a) Upon the request of the Contracting Officer, the Contractor 
shall grant admission to the Contractor's facilities and access to 
vessel, on a non-interference basis, as necessary to perform their 
respective responsibilities, to a reasonable number of:
    (1) Government and other Government contractor employees (in 
addition to those Government employees attached to the vessel); and
    (2) Representatives of offerors on other contemplated Government 
work.
    (b) All personnel granted access shall comply with Contractor rules 
governing personnel at its shipyard.

                             (End of clause)



252.217-7012  Liability and insurance.

    As prescribed in 217.7104(a), use the following clause:

                   Liability and Insurance (Dec. 1991)

    (a) The Contractor shall exercise its best efforts to prevent 
accidents, injury, or damage to all employees, persons, and property, in 
and about the work, and to the vessel or part of the vessel upon which 
work is done.
    (b) Loss or damage to the vessel, materials, or equipment. (1) 
Unless otherwise directed or approved in writing by the Contracting 
Officer, the Contractor shall not carry insurance against any form of 
loss or damage to the vessel(s) or to the materials or equipment to 
which the Government has title or which have been furnished by the 
Government for installation by the Contractor. The Government assumes 
the risks of loss of and damage to that property.
    (2) The Government does not assume any risk with respect to loss or 
damage compensated for by insurance or otherwise or resulting from risks 
with respect to which the Contractor has failed to maintain insurance, 
if available, as required or approved by the Contracting Officer.
    (3) The Government does not assume risk of and will not pay for any 
costs of the following:
    (i) Inspection, repair, replacement, or renewal of any defects in 
the vessel(s) or material and equipment due to--
    (A) Defective workmanship performed by the Contractor or its 
subcontractors;
    (B) Defective materials or equipment furnished by the Contractor or 
its subcontracts; or
    (C) Workmanship, materials, or equipment which do not conform to the 
requirements of the contract, whether or not the defect is latent or 
whether or not the nonconformance is the result of negligence.
    (ii) Loss, damage, liability, or expense caused by, resulting from, 
or incurred as a consequence of any delay or disruption, willful 
misconduct or lack of good faith by the Contractor or any of its 
representatives that have supervision or direction of--
    (A) All or substantially all of the Contractor's business; or
    (B) All or substantially all of the Contractor's operation at any 
one plant.
    (4) As to any risk that is assumed by the Government, the Government 
shall be subrogated to any claim, demand or cause of action against 
third parties that exists in favor

[[Page 423]]

of the Contractor. If required by the Contracting Officer, the 
Contractor shall execute a formal assignment or transfer of the claim, 
demand, or cause of action.
    (5) No party other than the Contractor shall have any right to 
proceed directly against the Government or join the Government as a co-
defendant in any action.
    (6) Notwithstanding the foregoing, the Contractor shall bear the 
first $5,000 of loss or damage from each occurrence or incident, the 
risk of which the Government would have assumed under the provisions of 
this paragraph (b).
    (c) Indemnification. The Contractor indemnifies the Government and 
the vessel and its owners against all claims, demands, or causes of 
action to which the Government, the vessel or its owner(s) might be 
subject as a result of damage or injury (including death) to the 
property or person of anyone other than the Government or its employees, 
or the vessel or its owner, arising in whole or in part from the 
negligence or other wrongful act of the Contractor or its agents or 
employees, or any subcontractor, or its agents or employees.
    (1) The Contractor's obligation to indemnify under this paragraph 
shall not exceed the sum of $300,000 as a consequence of any single 
occurrence with respect to any one vessel.
    (2) The indemnity includes, without limitation, suits, actions, 
claims, costs, or demands of any kind, resulting from death, personal 
injury, or property damage occurring during the period of performance of 
work on the vessel or within 90 days after redelivery of the vessel. For 
any claim, etc., made after 90 days, the rights of the parties shall be 
as determined by other provisions of this agreement and by law. The 
indemnity does apply to death occurring after 90 days where the injury 
was received during the period covered by the indemnity.
    (d) Insurance. (1) The Contractor shall, at its own expense, obtain 
and maintain the following insurance--
    (i) Casualty, accident, and liability insurance, as approved by the 
Contracting Officer, insuring the performance of its obligations under 
paragraph (c) of this clause.
    (ii) Workers Compensation Insurance (or its equivalent) covering the 
employees engaged on the work.
    (2) The Contractor shall ensure that all subcontractors engaged on 
the work obtain and maintain the insurance required in paragraph (d)(1) 
of this clause.
    (3) Upon request of the Contracting Officer, the Contractor shall 
provide evidence of the insurance required by paragraph (d) of this 
clause.
    (e) The Contractor shall not make any allowance in the job order 
price for the inclusion of any premium expense or charge for any reserve 
made on account of self-insurance for coverage against any risk assumed 
by the Government under this clause.
    (f) The Contractor shall give the Contracting Officer written notice 
as soon as practicable after the occurrence of a loss or damage for 
which the Government has assumed the risk.
    (1) The notice shall contain full details of the loss or damage.
    (2) If a claim or suit is later filed against the Contractor as a 
result of the event, the Contractor shall immediately deliver to the 
Government every demand, notice, summons, or other process received by 
the Contractor or its employees or representatives.
    (3) The Contractor shall cooperate with the Government and, upon 
request, shall assist in effecting settlements, securing and giving 
evidence, obtaining the attendance of witnesses, and in the conduct of 
suits. The Government shall reimburse the Contractor for expenses 
incurred in this effort, other than the cost of maintaining the 
Contractor's usual organization.
    (4) The Contractor shall not, except at its own expense, voluntarily 
make any payment, assume any obligation, or incur any expense other than 
what would be imperative for the protection of the vessel(s) at the time 
of the event.
    (g) In the event or loss of or damage to any vessel(s), material, or 
equipment which may result in a claim against the Government under the 
insurance provisions of this contract, the Contractor shall promptly 
notify the Contracting Officer of the loss or damage. The Contracting 
Officer may, without prejudice to any other right of the Government, 
either--
    (1) Order the Contractor to proceed with replacement or repair, in 
which event the Contractor shall effect the replacement or repair;
    (i) The Contractor shall submit to the Contracting Officer a request 
for reimbursement of the cost of the replacement or repair together with 
whatever supporting documentation the Contracting Officer may reasonably 
require, and shall identify the request as being submitted under the 
Insurance clause of the agreement.
    (ii) If the Government determines that the risk of the loss or 
damage is within the scope of the risks assumed by the Government under 
this clause, the Government will reimburse the Contractor for the 
reasonable, allowable cost of the replacement or repair, plus a 
reasonable profit (if the work or replacement or repair was performed by 
the Contractor) less the deductible amount specified in paragraph (b) of 
this clause.
    (iii) Payments by the Government to the Contractor under this clause 
are outside the scope of and shall not affect the pricing structure of 
the contract, and are additional to the compensation otherwise payable 
to the Contractor under this contract; or

[[Page 424]]

    (2) In the event the Contracting Officer decides that the loss or 
damage shall not be replaced or repaired, the Contracting Officer 
shall--
    (i) Modify the contract appropriately, consistent with the reduced 
requirements reflected by the unreplaced or unrepaired loss or damage; 
or
    (ii) Terminate the repair of any part or all of the vessel(s) under 
the Termination for Convenience of the Government clause of this 
agreement.

                             (End of clause)



252.217-7013  Guarantees.

    As prescribed in 217.7104(a), use the following clause:

                         Guarantees (Dec. 1991)

    (a) In the event any work performed or materials furnished by the 
contractor under the Master Agreement prove defective or deficient 
within 90 days from the date of redelivery of the vessel(s), the 
Contractor, as directed by the Contracting Officer and at its own 
expense, shall correct and repair the deficiency to the satisfaction of 
the Contracting Officer.
    (b) If the Contractor or any subcontractor has a guarantee for work 
performed or materials furnished that exceeds the 90 day period, the 
Government shall be entitled to rely upon the longer guarantee until its 
expiration.
    (c) With respect to any individual work item identified as 
incomplete at the time of redelivery of the vessel(s), the guarantee 
period shall run from the date the item is completed.
    (d) If practicable, the Government shall give the Contractor an 
opportunity to correct the deficiency.
    (1) If the Contracting Officer determines it is not practicable or 
is otherwise not advisable to return the vessel(s) to the Contractor, or 
the Contractor fails to proceed with the repairs promptly, the 
Contracting Officer may direct that the repairs be performed elsewhere, 
at the Contractor's expense.
    (2) If correction and repairs are performed by other than the 
Contractor, the Contracting Officer may discharge the Contractor's 
liability by making an equitable deduction in the price of the job 
order.
    (e) The Contractor's liability shall extend for an additional 90 day 
guarantee period on those defects or deficiencies that the Contractor 
corrected.
    (f) At the option of the Contracting Officer, defects and 
deficiencies may be left uncorrected. In that event, the Contractor and 
Contracting Officer shall negotiate an equitable reduction in the job 
price. Failure to agree upon an equitable reduction shall constitute a 
dispute under the Disputes clause of this agreement.

                             (End of clause)



252.217-7014  Discharge of liens.

    As prescribed in 217.7104(a), use the following clause:

                     Discharge of Liens (Dec. 1991)

    (a) The Contractor shall immediately discharge, or cause to be 
discharged, any lien or right in rem of any kind, other than in favor of 
the Government, that exists or arises in connection with work done or 
material furnished under any job order under this agreement.
    (b) If any lien or right in rem is not immediately discharged, the 
Government, at the expense of the Contractor, may discharge, or cause to 
be discharged, the lien or right.

                             (End of clause)



252.217-7015  Safety and health.

    As prescribed in 217.7104(a), use the following clause:

                      Safety and Health (Dec. 1991)

    Nothing contained in the Master Agreement or any job order shall 
relieve the Contractor of any obligations it may have to comply with--
    (a) The Occupational Safety and Health Act of 1970 (29 U.S.C. 651, 
et seq.);
    (b) The Safety and Health Regulations for Ship Repairing (29 CFR 
part 1915); or
    (c) Any other applicable Federal, State, and local laws, codes, 
ordinances, and regulations.

                             (End of clause)



252.217-7016  Plant protection.

    As prescribed in 217.7104(a), use the following clause:

                      Plant Protection (Dec. 1991)

    (a) The Contractor shall provide, for the plant and work in process, 
reasonable safeguards against all hazards, including unauthorized entry, 
malicious mischief, theft, vandalism, and fire.
    (b) The Contractor shall also provide whatever additional safeguards 
are necessary to protect the plant and work in process from espionage, 
sabotage, and enemy action.
    (1) The Government shall reimburse the Contractor for that portion 
of the costs of the additional safeguards that is allocable to the 
contract in the same manner as if the Contracting Officer had issued a 
change order for the additional safeguards.

[[Page 425]]

    (2) The costs reimbursed shall not include any overhead allowance, 
unless the overhead is incident to the construction or installation of 
necessary security devices or equipment.
    (c) Upon payment by the Government of the cost of any device or 
equipment required or approved under paragraph (b) of this clause, title 
shall vest in the Government.
    (1) The Contractor shall comply with the instructions of the 
Contracting Officer concerning its identification and disposition.
    (2) No such device or equipment shall become a fixture as a result 
of its being affixed to realty not owned by the Government.

                             (End of clause)



252.217-7017  Time of delivery.

    As prescribed in 217.7203(a)(1), use the following clause:

                      Time of Delivery (Dec. 1991)

    (a) Ordering offices shall specify delivery locations and quantities 
in all oral or written delivery orders under this contract.
    (b) The Contractor shall complete deliveries within the hours 
prescribed in the schedule of this contract and on the days specified by 
the order.
    (c) Orders requiring delivery within 24 hours from Contractor 
receipt are governed by paragraph (e) of the Requirements clause of this 
contract.

                             (End of clause)

                         Alternate I (Dec. 1991)

    As prescribed in 217.7203(a)(1), substitute the following paragraph 
(c) for paragraph (c) of the basic clause:
    (c) The Contractor shall not be required to deliver within less than 
______ hours from the time the Contractor receives a delivery order.



252.217-7018  Change in plant location--bakery and dairy products.

    As prescribed in 217.7203(a)(2), use the following clause:

     Change in Plant Location--Bakery and Dairy Products (Dec. 1991)

    (a) The Offeror shall identify in the clause in this solicitation 
entitled Place of Performance, all plants to be used for manufacturing, 
processing, and shipment. Failure to furnish this information with the 
offer may result in rejection of the offer.
    (b) The Offeror shall not change any place of performance between 
the date set for receipt of offers and the award, except where time 
permits and then only after receipt of the Contracting Officer's written 
approval.
    (c) The Contractor shall not change any place of performance after 
contract award without advance approval by the Contracting Officer.

                             (End of clause)



252.217-7019  Sanitary conditions.

    As prescribed in 217.7203(a)(3), use the following clause:

                     Sanitary Conditions (Dec. 1991)

    (a) The Contractor shall ensure that all supplies delivered under 
this contract, and all plant facilities, machinery, equipment, and 
apparatus used in the production, processing, handling, storage, or 
delivery of these supplies, meet the sanitary standards (including 
bacteriological requirements) prescribed by the specifications cited in 
this contract.
    (b) The Government reserves the right to inspect and test at any 
reasonable times all plant facilities, machinery, equipment, and parts 
used in the production, processing, handling, storage, transportation, 
or delivery of supplies under this contract.
    (c) The Contracting Officer or representative shall notify the 
Contractor in writing of any failure to meet the sanitary standards 
(including bacteriological requirements) prescribed by this contract. If 
the Contractor does not correct the failure within three days from 
receipt of notice, the Contracting Officer may--
    (1) Terminate for default all or part of this contract; or
    (2) Suspend work (wholly or partially) under the contract for ten 
days or any longer period considered necessary to allow correction of 
the failure.
    (d) The suspension does not extend the life of this contract and 
shall not be considered sufficient reason for extending the delivery 
time.
    (e) During the suspension period, the Government reserves the right 
to acquire similar supplies from other sources, on whatever terms and in 
whatever manner the Contracting Officer considers appropriate. The 
Contractor shall be liable to the Government for any excess costs for 
those similar supplies.
    (f) If the Contractor does not correct the failure within the 
suspension period, the Contracting Officer may terminate for default the 
unexpired portion of this contract without allowing additional time for 
correction, notwithstanding paragraph (a)(2) of the Default (Fixed-Price 
Supply and Service) clause of this contract.

                             (End of clause)

                         Alternate I (Dec. 1991)

    As prescribed in 217.7203(a)(3), add the following to paragraph (d) 
of the basic clause:

[[Page 426]]

In a suspension, the quantity of supplies designated in the schedule as 
a minimum shall be reduced by an amount proportionate to the ratio 
between (1) the number of days the work is suspended; and (2) the number 
of days in the contract period. The quantity of supplies designated as 
maximum shall not be reduced.



252.217-7020  Examination and testing.

    As prescribed in 217.7203(b)(1), use the following clause:

                   Examination and Testing (Dec. 1991)

    (a) The Government reserves the right to examine and test all 
products to be delivered under the contract. Examination and testing of 
dairy products shall be in accordance with the Veterinary/Medical 
Wholesomeness Assurance Program for Fresh and Cultured Dairy Products 
and Frozen Desserts (AR 40-70; NAVSUPINST 4355.6; AFR 161-46; and MCO 
10110.44).
    (b) Samples. (1) The Government shall select the samples. For 
purposes of this clause, the Contractor agrees that a lot consists of a 
day's production of the type of product delivered, or intended to be 
delivered, under this contract.
    (2) Samples selected at origin shall be furnished at the 
Contractor's expense, and shall be considered representative of all the 
products delivered to the Government from the lot sampled.
    (3) Samples selected at destination shall be furnished at Government 
expense, and shall be considered representative of all of that type 
product delivered to the Government on the date sampled.
    (4) When samples are selected from containers of 1/2 gallon size or 
smaller, the entire contents of the container shall constitute the 
sample. When samples are selected from containers larger than 1/2 
gallon, a 1/2 pint sample shall be taken for laboratory analysis.
    (c) Deficiencies in amounts. The Contractor shall reimburse the 
Government for deficiencies (i.e., amounts less than required in this 
contract) in the amount of butterfat, milk solids non-fat, or total 
solids of any type of product as determined by chemical analysis. The 
amount of the reimbursement shall be determined in accordance with the 
Deficiency Adjustment clause of this contract. The Government shall not 
reimburse the Contractor for butterfat, milk solids non-fat, and total 
solids content in excess of the amount required by this contract.
    (d) Deficiencies in products. (1) The Contracting Officer or 
representative shall notify the Contractor orally (with written 
confirmation) or in writing when two of the last four consecutive lots 
tested are nonconforming for the same specification requirements. The 
notice shall be in effect as long as two of the last four consecutive 
lots tested exceed the same limit of the specification. The Government 
will take additional samples between 3 and 14 days after the date of the 
notice.
    (2) The Contracting Officer may suspend work under this contract for 
up to ten days when three out of the last five consecutive lots tested 
are nonconforming for the same specification requirement, or when any 
deficiency causes the production of a product which is considered to be 
a health hazard.
    (e) Suspension. (1) During the suspension period, the Government 
reserves the right to acquire similar supplies from other sources, on 
whatever terms and in whatever manner the Contracting Officer considers 
appropriate. The Contractor shall be liable to the Government for any 
excess costs for those similar supplies.
    (2) The Contractor shall use the suspension period to correct the 
deficiencies. The Contractor shall notify the Government when corrective 
action is complete.
    (3) The Contracting Officer shall lift the suspension only after the 
Government has verified the corrective action and notified the 
Contractor in writing.
    (4) The suspension does not extend the life of this contract and 
shall not be considered sufficient reason for extending the delivery 
time.
    (5) If the Contractor does not correct the failure within the 
suspension period, the Contracting Officer may terminate for default the 
unexpired portion of this contract without allowing additional time for 
correction, notwithstanding paragraph (a)(2) of the Default (Fixed-Price 
Supply and Service) clause of this contract.

                             (End of clause)

                         Alternate I (Dec. 1991)

    As prescribed in 217.7203(b)(1), add the following to paragraph 
(d)(2) of the basic clause:
    In a suspension, the quantity of supplies designated in the schedule 
as minimum shall be reduced by an amount proportionate to the ratio 
between (i) the number of days the work is suspended; and (ii) the 
number of days in the contract period. The quantity of supplies 
designated as maximum shall not be reduced.



252.217-7021  Deficiency adjustment.

    As prescribed in 217.7203(b)(2), use the following clause:

                    Deficiency Adjustment (Dec. 1991)

    (a) When the Contractor is required under the Examination and 
Testing clause of the contract to reimburse the Government for 
deficiencies in the amount of butterfat, milk solids non-fat, or total 
solids, reimbursement

[[Page 427]]

shall be determined by the following formula--
    (1) Butterfat. Subtract the total pounds of butterfat delivered from 
the total pounds of butterfat required to be delivered, and multiply the 
remainder by the butterfat value. The butterfat value is 1.30 multiplied 
by the average Central States top ``Wholesale Selling Price'' of Grade 
A, 92 score butter during the monthly period for which the deficiency is 
computed, as reported in the Dairy Market News, published by the 
Department of Agriculture, Agricultural Marketing Service, Madison, 
Wisconsin.
    (2) Milk solids nonfat. Subtract the total pounds of milk solids 
non-fat delivered from the total pounds of milk solids non-fat required 
to be delivered, and multiply the remainder by the milk solids non-fat 
value. The milk solids non-fat value is 1.45 multiplied by the average 
Central States top price for ``Extra Grade, Non-fat Dry Milk, Spray 
(bags)'' during the monthly period for which the deficiency is computed, 
as reported in the Dairy Market News.
    (3) Total solids. Add to the total solids delivered the total amount 
of any shortages for butterfat and milk solids non-fat that the 
Contractor has already reimbursed. Subtract this amount from the total 
solids required to be delivered. Multiply the remainder by the milk 
solids non-fat value.
    (b) The Government will not assess amounts totaling $25 or less 
during a monthly accounting period. Monthly periods begin on the first 
day of the contract period and on the same day of each succeeding month.
    (c) The butterfat, milk solids non-fat, and total solids content of 
one type of product shall not be averaged with or offset against the 
content of another type of product, and the content of products 
delivered in any one monthly period will not be averaged with or offset 
against the content of products delivered in any other monthly period.
    (d) The Contractor shall identify the tare weights of all containers 
on the shipping documents, and furnish a copy to the Government 
inspector at destination. The tare weight of dispenser containers shall 
include all parts of the container delivered as a unit, including lids, 
tubes, and seals. If different types of containers with different tares 
are included in a single delivery, the Contractor shall furnish the tare 
weight and identifying characteristics of each type of container.
    (e) The Government shall inspect a representative sample of the line 
item. If volume and net weight shortages are found, the Government will 
adjust the entire quantity of the line item delivered on the day the 
shortage is discovered. For the purpose of determining net weight, the 
following weight factors apply:

                                                                        
------------------------------------------------------------------------
               Product                           Weight factor          
------------------------------------------------------------------------
Chocolate flavored milk or drink....  8.8 pounds/gallon.                
Milk whole fresh, buttermilk fluid,   8.6 pounds/gallon.                
 milk whole fresh. cultured, and                                        
 milk skim fresh.                                                       
Fresh cream (18 percent butterfat or  8.5 pounds/gallon.                
 less), half-and-half fresh, and                                        
 cream sour cultured.                                                   
Fresh cream (more than 18 percent     8.4 pounds/gallon.                
 butterfat).                                                            
Cottage cheese, butter, and other     Weight on container.              
 non-frozen products.                                                   
Ice cream and frozen desserts.......  Applicable commodity              
                                       specification.                   
------------------------------------------------------------------------

    (f) Contractor reimbursement for deficient supplies does not 
prejudice the Government's right to terminate for default or to pursue 
any other remedy under this contract or as provided by law.

                             (End of clause)



252.217-7022  Code dating.

    As prescribed in 217.7203(a)(4), use the following clause:

                         Code Dating (Dec. 1991)

    (a) The Contractor may use a code to comply with the requirement 
stated in the schedule or specifications of this contract for showing a 
date on the labels of delivered items.
    (b) Before using a code, the Contractor shall--
    (1) Provide a written explanation to the Contracting Officer; and
    (2) Obtain the Contracting Officer's approval in writing.
    (c) The Contractor shall also obtain the Contracting Officer's 
written approval before making any changes in the code symbols, system, 
or explanation.

                             (End of clause)



252.217-7023  Marking.

    As prescribed in 217.7203(a)(5), use the following clause:

                           Marking (Dec. 1991)

    Commercial markings are acceptable, notwithstanding any 
specification references to MIL-STD-129.

                             (End of clause)



252.217-7024  Responsibility for containers and equipment.

    As prescribed in 217.7203(a)(6), use the following clause:

[[Page 428]]

         Responsibility for Containers and Equipment (Dec. 1991)

    (a) The Contractor shall--
    (1) Maintain all reusable containers and equipment in a sanitary 
condition and in a good state of repair and working order; and
    (2) Remove all empty, reusable containers from Government premises 
at the time of each delivery, unless the Contracting Officer grants 
permission in writing for less frequent removal.
    (b) The Government shall not be liable for any damage to, or loss or 
destruction of, containers and equipment furnished by the Contractor.

                             (End of clause)



252.217-7025  Containers and equipment.

    As prescribed in 217.7203(b)(3), use the following clause:

                  Containers and Equipment (Dec. 1991)

    (a) The Contractor shall ensure that dispenser containers and 
filling equipment used in the performance of this contract, and any 
Contractor-furnished refrigerated bulk milk dispenser cabinets, comply 
with MIL-STD-175, Minimum Sanitary Standards for the Equipment and 
Methods for Handling of Milk and Milk Products in Bulk Milk Dispensing 
Operations.
    (b) The Contractor shall install, service, and maintain any 
Contractor-furnished bulk milk dispenser cabinets to the Contracting 
Officer's satisfaction. The Contractor has sole responsibility for the 
supply, installation, maintenance, and removal of the cabinets, 
including labor and material costs, and for any damage to, or loss or 
destruction of, such cabinets.
    (c) When the Contractor fails to furnish milk dispenser cabinets or 
milk dispenser containers as required in the schedule, or does not 
properly service, maintain, and repair such dispenser cabinets, so that 
milk cannot be dispensed as needed by the Government, the Contractor 
shall, for as long as such conditions exist, deliver a sufficient 
quantity of milk in half-pint containers to satisfy orders for milk 
dispenser containers. The price per gallon for milk dispenser containers 
shall apply.
    (d) When any loss of contents of a dispenser container occurs 
(including loss due to contamination, spoilage, or leakage) as a result 
of functional failure of the dispenser cabinet or dispenser containers, 
the Contractor shall immediately replace the lost contents without cost 
to the Government, unless such functional failure was due to a general 
power failure at the Government installation.

                             (End of clause)



252.217-7026  Identification of sources of supply.

    As prescribed in 217.7303, use the following provision:

             Identification of Sources of Supply (NOV 1995)

    (a) The Government is required under 10 U.S.C. 2384 to obtain 
certain information on the actual manufacturer or sources of supplies it 
acquires.
    (b) The apparently successful Offeror agrees to complete and submit 
the following table before award:

[[Page 429]]



                                                                          Table                                                                         
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                               Source of supply                                         
           Line items             National stock No.  Commercial item (Y ------------------------------------------------------------     Actual mfg?   
                                                             or N)              Company             Address            Part No.                         
(1)                               (2)...............  (3)...............  (4)...............  (4)...............  (5)...............  (6)               
                                                                                                                                                        
--------------------------------------------------------------------------------------------------------------------------------------------------------
______..........................  ______............  ______............  ______............  ______............  ______............  ______            
--------------------------------------------------------------------------------------------------------------------------------------------------------
(1) List each deliverable item of supply and item of technical data.                                                                                    
(2) If there is no national stock number, list ``none.''                                                                                                
(3) Use ``Y'' if the item is a commercial item; otherwise use ``N.'' If ``Y'' is listed, the Offeror need not complete the remaining columns in the     
  table.                                                                                                                                                
(4) For items of supply, list all sources. For technical data, list the source.                                                                         
(5) For items of supply, list each source's part number for the item.                                                                                   
(6) Use ``Y'' if the source of supply is the actual manufacturer; ``N'' if it is not; and ``U'' if unknown.                                             


[[Page 430]]

                           (End of provision)

[56 FR 36479, July 31, 1991, as amended at 59 FR 27675, May 27, 1994; 60 
FR 61601, Nov. 30, 1995]



252.217-7027  Contract definitization.

    As prescribed in 217.7406(b), use the following clause:

                   Contract Definitization (FEB 1996)

    (a) A ______(insert specific type of contract action) is 
contemplated. The Contractor agrees to begin promptly negotiating with 
the Contracting Officer the terms of a definitive contract that will 
include (1) all clauses required by the Federal Acquisition Regulation 
(FAR) on the date of execution of the underfinitized contract action, 
(2) all clauses required by law on the date of execution of the 
definitive contract action, and (3) any other mutually agreeable 
clauses, terms, and conditions. The Contractor agrees to submit a 
______(insert type of proposal; e.g., fixed-price or cost-and-fee) 
proposal and cost or pricing data supporting its proposal.
    (b) The schedule for definitizing this contract is as follows 
(insert target date for definitization of the contract action and dates 
for submission of proposal, beginning of negotiations, and, if 
appropriate, submission of the make-or-buy and subcontracting plans and 
cost or pricing data).

 _______________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

    (c) If agreement on a definitive contract action to supersede this 
undefinitized contract action is not reached by the target date in 
paragraph (b) of this clause, or within any extension of it granted by 
the Contracting Officer, the Contracting Officer may, with the approval 
of the head of the contracting activity, determine a reasonable price or 
fee in accordance with subpart 15.8 and part 31 of the FAR, subject to 
Contractor appeal as provided in the Disputes clause. In any event, the 
Contractor shall proceed with completion of the contract, subject only 
to the Limitation of Government Liability clause.
    (1) After the Contracting Officer's determination of price or fee, 
the contract shall be governed by--
    (i) All clauses required by the FAR on the date of execution of this 
underfinitized contract action for either fixed-price or cost-
reimbursement contracts, as determined by the Contracting Officer under 
this paragraph (c);
    (ii) All clauses required by law as of the date of the Contracting 
Officer's determination; and
    (iii) Any other clauses, terms, and conditions mutually agreed upon.
    (2) To the extent consistent with paragraph (c)(1) of this clause, 
all clauses, terms, and conditions included in this undefinitized 
contract action shall continue in effect, except those that by their 
nature apply only to an undefinitized contract action.
    (d) The definitive contract resulting from this undefinitized 
contract action will include a negotiated ____________________ (insert 
``cost/price ceiling'' or ``firm-fixed price'') in no event to exceed 
____________________ (insert the not-to-exceed amount).

(End of clause)
[61 FR 7750, Feb. 29, 1996; 61 FR 18195, Apr. 24, 1996]



252.217-7028  Over and above work.

    As prescribed in 217.7702, use a clause substantially as follows:

                     Over and Above Work (Dec. 1991)

    (a) Definitions.
    As used in this clause--
    (1) Over and above work means work discovered during the course of 
performing overhaul, maintenance, and repair efforts that is--
    (i) Within the general scope of the contract;
    (ii) Not covered by the line item(s) for the basic work under the 
contract; and
    (iii) Necessary in order to satisfactorily complete the contract.
    (2) Work request means a document prepared by the Contractor which 
describes over and above work being proposed.
    (b) The Contractor and Administrative Contracting Officer shall 
mutually agree to procedures for Government administration and 
Contractor performance of over and above work requests. If the parties 
cannot agree upon the procedures, the Administrative Contracting Officer 
has the unilateral right to direct the over and above work procedures to 
be followed. These procedures shall, as a minimum, cover--
    (1) The format, content, and submission of work requests by the 
Contractor. Work requests shall contain data on the type of discrepancy 
disclosed, the specific location of the discrepancy, and the estimated 
labor hours and material required to correct the discrepancy. Data shall 
be sufficient to satisfy contract requirements and obtain the 
authorization of the Contracting Officer to perform the proposed work;
    (2) Government review, verification, and authorization of the work; 
and
    (3) Proposal pricing, submission, negotiation, and definitization.
    (c) Upon discovery of the need for over and above work, the 
Contractor shall prepare and

[[Page 431]]

furnish to the Government a work request in accordance with the agreed-
to procedures.
    (d) The Government shall--
    (1) Promptly review the work request;
    (2) Verify that the proposed work is required and not covered under 
the basic contract line item(s);
    (3) Verify that the proposed corrective action is appropriate; and
    (4) Authorize over and above work as necessary.
    (e) The Contractor shall promptly submit to the Contracting Officer, 
a proposal for the over and above work. The Government and Contractor 
will then negotiate a settlement for the over and above work. Contract 
modifications will be executed to definitize all over and above work.
    (f) Failure to agree on the price of over and above work shall be a 
dispute within the meaning of the Disputes clause of this contract.

                             (End of clause)



252.219-7000  Small disadvantaged business concern representation (DoD contracts).

    As prescribed in 219.304(b), use the following provision:

  Small Disadvantaged Business Concern Representation (DoD Contracts) 
                               (June 1997)

    (a) Definition. Small disadvantaged business concern, as used in 
this provision, means a small business concern, owned and controlled by 
individuals who are both socially and economically disadvantaged, as 
defined by the Small Business Administration at 13 CFR part 124, the 
majority of earnings of which directly accrue to such individuals. This 
term also means a small business concern owned and controlled by an 
economically disadvantaged Indian tribe or Native Hawaiian organization 
which meets the requirements of 13 CFR 124.112 or 13 CFR 124.113, 
respectively. In general, 13 CFR part 124 describes a small 
disadvantaged business concern as a small business concern--
    (1) Which is at least 51 percent unconditionally owned by one or 
more socially and economically disadvantaged individuals; or
    (2) In the case of any publicly owned business, at least 51 percent 
of the voting stock is unconditionally owned by one or more socially and 
economically disadvantaged individuals; and
    (3) Whose management and daily business operations are controlled by 
one or more such individuals.
    (b) Representations. Check the category in which your ownership 
falls--

--Subcontinent Asian (Asian-Indian) American (U.S. citizen with origins 
from India, Pakistan, Bangladesh, Sri Lanka, Bhutan, the Maldives 
Islands, or Nepal)
--Asian-Pacific American (U.S. citizen with origins from Japan, China, 
the Philippines, Vietnam, Korea, Samoa, Guam, U.S. Trust Territory of 
the Pacific Islands (Republic of Palau), the Northern Mariana Islands, 
Laos, Kampuchea (Cambodia), Taiwan, Burma, Thailand, Malaysia, 
Indonesia, Singapore, Brunei, Republic of the Marshall Islands, the 
Federated States of Micronesia, Macao, Hong Kong, Fiji, Tonga, Kiribati, 
Tuvalu, or Nauru)
________ Black American (U.S. citizen)
________ Hispanic American (U.S. citizen with origins from South 
America, Central America, Mexico, Cuba, the Dominican Republic, Puerto 
Rico, Spain, or Portugal)
________ Native American (American Indians, Eskimos, Aleuts, or Native 
Hawaiians, including Indian tribes or Native Hawaiian organizations)
________ Individual/concern, other than one of the preceding, currently 
certified for participation in the Minority Small Business and Capital 
Ownership Development Program under section 8(a) of the Small Business 
Act
________ Other
    (c) Complete the following--
    (1) The offeror is ____ is not ____ a small disadvantaged business 
concern.
    (2) The Small Business Administration (SBA) has ____ has not ____ 
made a determination concerning the offeror's status as a small 
disadvantaged business concern. If the SBA has made a determination, the 
date of the determination was ____ and the offeror--

________ Was found by SBA to be socially and economically disadvantaged 
and no circumstances have changed to vary that determination.
________ Was found by SBA not to be socially and economically 
disadvantaged but circumstances which caused the determination have 
changed.

    (d) Penalties and remedies. Anyone who misrepresents the status of a 
concern as a small disadvantaged business for the purpose of securing a 
contract or subcontract shall--
    (1) Be punished by imposition of a fine, imprisonment, or both;
    (2) Be subject to administrative remedies, including suspension and 
debarment; and
    (3) Be ineligible for participation in programs conducted under 
authority of the Small Business Act.

                           (End of provision)

[56 FR 36479, July 31, 1991, as amended at 59 FR 22131, Apr. 29, 1994; 
62 FR 2614, Jan. 17, 1997; 62 FR 34128, June 24, 1997]

[[Page 432]]



252.219-7001  Notice of partial small business set-aside with preferential consideration for small disadvantaged business concerns.

    As prescribed in 219.508(d), use the following clause:

      Notice of Partial Small Business Set-Aside With Preferential 
   Consideration for Small Disadvantaged Business Concerns (May 1995)

    (a) Definitions.
    Labor surplus area, as used in this clause, means a geographical 
area identified by the Department of Labor as an area of labor surplus.
    Labor surplus area concern, as used in this clause, means a concern 
that, together with its first tier subcontractors, will perform 
substantially in labor surplus areas.
    Perform substantially in labor surplus areas, as used in this 
clause, means that the costs incurred under the contract on account of 
manufacturing, production, and performance of services in labor surplus 
areas exceed 50 percent of the contract price.
    Small business concern, as used in this clause, means a concern, 
including its affiliates, that is independently owned and operated, not 
dominant in the field of operation in which it is bidding on Government 
contracts, and qualified as a small business under the size standards in 
this solicitation.
    Small disadvantaged business concern, as used in this clause, means 
a small business concern, owned and controlled by individuals who are 
both socially and economically disadvantaged, as defined by the Small 
Business Administration at 13 CFR part 124, the majority of earnings of 
which directly accrue to such individuals. This term also means a small 
business concern owned and controlled by an economically disadvantaged 
Indian tribe or Native Hawaiian organization which meets the 
requirements of 13 CFR 124.112 or 13 CFR 124.113, respectively.
    United States, as used in this clause, means the United States, its 
territories and possessions, the Commonwealth of Puerto Rico, the U.S. 
Trust Territory of the Pacific Islands, or the District of Columbia.
    (b) General. A portion of this requirement, identified elsewhere in 
this solicitation, has been set-aside for award to one or more small 
business concerns. After offers for the non-set-aside portion have been 
evaluated, negotiations will be conducted for the set-aside portion.
    (1) Offers on the non-set-aside portion will be evaluated and award 
made in accordance with the other provisions of this solicitation.
    (2) The set-aside portion will be negotiated, in accordance with 
this clause, with small business concerns which submitted offers on the 
non-set-aside portion.
    (c) Award of the set-aside portion. (1) Small business offerors on 
the non-set-aside portion will be selected for negotiation of the set-
aside portion based on their standing--first in terms of group and then 
in terms of lowest responsive offer on the non-set-aside portion.
    (i) Group 1--Small disadvantaged business concerns which are also 
labor surplus area concerns.
    (ii) Group 2--Small business concerns which are also labor surplus 
area concerns.
    (iii) Group 3--Other small disadvantaged business concerns.
    (iv) Group 4--Other small business concerns.
    (2) The set-aside portion will be awarded at the highest unit 
price(s) in the contract(s) for the non-set-aside portion, adjusted to 
reflect transportation and other costs appropriate for the selected 
contractor(s), except--
    (i) Award of the set-aside portion to a small disadvantaged business 
concern will be at the lower of--
    (A) The price offered by the concern on the non-set-aside portion; 
or
    (B) A price that does not exceed the award price on the non-set-
aside portion by more than ten percent.
    (ii) When award under the set-aside portion is to a concern offering 
a nonqualifying country end product and the highest unit price in the 
contract(s) is for a domestic or qualifying country end product, the 
set-aside price will be the higher of--
    (A) The highest award price for a nonqualifying country end product 
under the nonset-aside; or
    (B) A price which, when adjusted by the Buy American Act evaluation 
factor, would equal the highest unit price in the contract(s).
    (iii) When award under the set-aside portion is to a concern 
offering a domestic end product and the highest unit price in the 
contract(s) is for a nonqualifying country end product which was 
evaluated using the Buy American Act evaluation factor, the set-aside 
price will be awarded at the evaluated price of the non-qualifying 
country.
    (iv) When award under the set-aside portion is to a concern offering 
a domestic end product and the highest unit price in the contract(s) is 
for a nonqualifying country end product which was evaluated without the 
Buy American Act factor--
    (A) And award was made to a domestic or qualifying country offer at 
a price lower than the high contract price, the set-aside price will be 
the highest unit price in the contract(s).
    (B) And award was not made to a domestic or qualifying country offer 
at a price lower than the high contract price, the set-aside price will 
be the lower of--

[[Page 433]]

    (1) The highest unit price under the contract(s) as adjusted by the 
Buy American Act evaluation factor; or
    (2) The lowest offered price for a domestic or qualifying country 
end product which was not awarded under the nonset-aside.
    (v) Where the Trade Agreements Act applies to the nonset-aside 
portion, offers of eligible products will be treated as if they were 
qualifying country end products.
    (vi) Discount terms used in evaluation of the highest non-set-aside 
award price will apply to the set-aside award price.
    (3) If negotiations are not successful for any part of the set-aside 
portion, the set-aside will be dissolved for that part and the 
requirement will be resolicited.
    (d) Token offers. The Government reserves the right to not consider 
token offers or offers designed to secure an unfair advantage over other 
offerors eligible for the set-aside portion.
    (e) Eligibility for preference as a labor surplus area concern. 
Small business or small disadvantaged business offerors which claim 
preference for the set-aside portion as a labor surplus area concern, 
must list the labor surplus area location(s) of offeror or first tier 
subcontractors, which account for more than 50 percent of the contract 
price.

Name of Company:
Street Address:
City/County:
State:
    (f) Agreements.
    (1) If awarded a contract as a small disadvantaged business-labor 
surplus area concern or as a small business-labor surplus area concern, 
the offeror--
    (i) Will perform the contract, or cause it to be performed, 
substantially in areas classified as labor surplus areas.
    (ii) If the contract is in excess of $25,000, will submit a report 
to the Contracting Officer within 30 days after award that contains the 
following information--
    (A) The dollar amount of the contract.
    (B) Identification of each labor surplus area in which contract and 
subcontract performance is taking or will take place.
    (C) The total costs incurred and to be incurred under the contract 
in each of the labor surplus areas by the contractor and first tier 
subcontractors.
    (D) The total dollar amount attributable to performance in labor 
surplus areas.
    (2) A manufacturer or regular dealer, which claims preference as a 
small disadvantaged business and submits an offer in its own name, 
agrees to furnish in performing this contract only end items 
manufactured or produced by small disadvantaged business concerns in the 
United States, except, as provided in section 8051 of Pub. L. 103-139 
and section 8012 of Pub. L. 103-335, for contracts awarded during fiscal 
years 1994 and 1995, a small disadvantaged business manufacturer or 
regular dealer owned by an Indian tribe, including an Alaska Native 
Corporation, agrees to furnish only end items manufactured or produced 
by small business concerns in the United States.

                             (End of clause)

                         Alternate I (May 1994)

    As prescribed in 219.508(d), substitute the following paragraph 
(f)(2) for paragraph (f)(2) of the basic clause:
    (f)(2) A regular dealer, which claims preference as a small 
disadvantaged business and submits an offer in its own name, agrees to 
furnish in performing this contract only end items manufactured or 
produced by small business concerns in the United States.
[56 FR 36479, July 31, 1991, as amended at 59 FR 24959, May 13, 1994; 60 
FR 29502, June 5, 1995]



252.219-7002  Notice of small disadvantaged business set-aside.

    As prescribed in 219.508-70, use the following clause:

       Notice of Small Disadvantaged Business Set-Aside (May 1995)

    (a) Definitions.
    Small disadvantaged business concern, as used in this clause, means 
a small business concern, owned and controlled by individuals who are 
both socially and economically disadvantaged, as defined by the Small 
Business Administration at 13 CFR part 124, the majority of earnings of 
which directly accrue to such individuals. This term also means a small 
business concern owned and controlled by an economically disadvantaged 
Indian tribe or Native Hawaiian organization which meets the 
requirements of 13 CFR 124.112 or 13 CFR 124.113, respectively.
    United States, as used in this clause, means the United States, its 
territories and possessions, the Commonwealth of Puerto Rico, the U.S. 
Trust Territory of the Pacific Islands, or the District of Columbia.
    (b) General. Offers are solicited only from small disadvantaged 
business concerns. Offers received from concerns that are not small 
disadvantaged businesses are nonresponsive and will be rejected.
    (c) Agreement. A small disadvantaged business manufacturer or 
regular dealer, submitting an offer in its own name, agrees to furnish 
in performing this contract only end items manufactured or produced by 
small disadvantaged business concerns in the United States, except, as 
provided in section 8051 of Pub. L. 103-139 and section 8012 of Pub. L. 
103-335, for contracts awarded during fiscal years 1994 and 1995, a 
small disadvantaged business manufacturer or regular dealer

[[Page 434]]

owned by an Indian tribe, including an Alaska Native Corporation, agrees 
to furnish only end items manufactured or produced by small business 
concerns in the United States.

                             (End of clause)

                         Alternate I (May 1994)

    As prescribed in 219.508-70, substitute the following paragraph (c) 
for paragraph (c) of the basic clause:
    (c) Agreement. A small disadvantaged business regular dealer 
submitting an offer in its own name agrees to furnish in performing this 
contract only end items manufactured or produced by small business 
concerns in the United States.
[56 FR 36479, July 31, 1991, as amended at 59 FR 24959, May 13, 1994; 60 
FR 29502, June 5, 1995]

    Effective Date Note: At 60 FR 54955, Oct. 27, 1995, Sec. 252.219-
7002 was suspended indefinately.



252.219-7003  Small, small disadvantaged and women-owned small business subcontracting plan (DoD contracts).

    As prescribed in 219.708(b)(1)(A), use the following clause:

Small, Small Disadvantaged and Women-Owned Small Business Subcontracting 
                     Plan (DoD Contracts) (APR 1996)

    This clause supplements the Federal Acquisition Regulation 52.219-9, 
Small, Small Disadvantaged and Women-Owned Small Business Subcontracting 
Plan, clause of this contract.
    (a) Definitions. Historically black colleges and universities, as 
used in this clause, means institutions determined by the Secretary of 
Education to meet the requirements of 34 CFR 608.2. The term also means 
any nonprofit research institution that was an integral part of such a 
college or university before November 14, 1986.
    Minority institutions, as used in this clause, means institutions 
meeting the requirements of section 1046(3) of the Higher Education Act 
of 1965 (20 U.S.C. 1135d-5(3)). The term also includes Hispanic-serving 
institutions as defined in section 316(b)(1) of such Act (20 U.S.C. 
1059c (b)(1)).
    (b) Except for company or division-wide commercial items 
subcontracting plans, the term small disadvantaged business, when used 
in the FAR 52.219-9 clause, includes historically black colleges and 
universities and minority institutions, in addition to small 
disadvantaged business concerns.
    (c) Work under the contract or its subcontracts shall be credited 
toward meeting the small disadvantaged business concern goal required by 
paragraph (d) of the FAR 52.219-9 clause when:
    (1) It is performed on Indian lands or in joint venture with an 
Indian tribe or a tribally-owned corporation, and
    (2) It meets the requirements of 10 U.S.C. 2323a.
    (d) Subcontracts awarded to workshops approved by the Committee for 
Purchase from People Who Are Blind or Severely Disabled (41 U.S.C. 46-
48), may be counted toward the Contractor's small business 
subcontracting goal.
    (e) A mentor firm, under the Pilot Mentor-Protege Program 
established under Section 831 of Pub. L. 101-510, as amended, may count 
toward its small disadvantaged business goal, subcontracts awarded--
    (1) Protege firms which are qualified organizations employing the 
severely handicapped; and
    (2) Former protege firms that meet the criteria in Section 831(g)(4) 
of Pub. L. 101-510.
    (f) The master plan approval referred to in paragraph (f) of the FAR 
52.219-9 clause is approval by the Contractor's cognizant contract 
administration activity.
    (g) In those subcontracting plans which specifically identify small, 
small disadvantaged, and women-owned small businesses, the Contractor 
shall notify the Administrative Contracting Officer of any substitutions 
of firms that are not small, small disadvantaged, or women-owned small 
businesses for the firms listed in the subcontracting plan. 
Notifications shall be in writing and shall occur within a reasonable 
period of time after award of the subcontract. Contractor-specified 
formats shall be acceptable.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 59 FR 22131, Apr. 29, 1994; 
59 FR 27675, May 27, 1994; 60 FR 61601, Nov. 30, 1995; 61 FR 18688, Apr. 
29, 1996]



252.219-7004  Small, small disadvantaged and women-owned small business subcontracting plan (test program).

    As prescribed in 219.708(b)(1)(B), use the following clause:

Small, Small Disadvantaged and Women-Owned Small Business Subcontracting 
                     Plan (Test Program) (June 1997)

    (a) Definition. Subcontract, as used in this clause, means any 
agreement (other than one involving an employer-employee relationship) 
entered into by a Federal Government prime Contractor or subcontractor 
calling for supplies or services required for performance of the 
contract or subcontract.
    (b) The Offeror's comprehensive small business subcontracting plan 
and its successors,

[[Page 435]]

which are authorized by and approved under the test program of Section 
834 of Pub. L. 101-189, as amended, shall be included in and made a part 
of the resultant contract. Upon expulsion from the test program or 
expiration of the test program, the Contractor shall negotiate an 
individual subcontracting plan for all future contracts that meet the 
requirements of Section 211 of Pub. L. 95-507.
    (c) The Contractor shall submit Standard Form (SF) 295, Summary 
Subcontract Report, in accordance with the instructions on the form, 
except--
    (1) One copy of the SF 295 and attachments shall be submitted to 
Director, Small and Disadvantaged Business Utilization, Office of the 
Deputy Under Secretary of Defense (International and Commercial 
Programs), 3061 Defense Pentagon, Room 2A338, Washington, DC 20301-3061; 
and
    (2) Item 14, Remarks, shall be completed to include semi-annual 
cumulative--
    (i) Small business, small disadvantaged business, and women-owned 
small business goals; and
    (ii) Small business and small disadvantaged business goals, actual 
accomplishments, and percentages for each of the two designated industry 
categories.
    (d) The failure of the Contractor or subcontractor to comply in good 
faith with (1) the clause of this contract entitled ``Utilization of 
Small, Small Disadvantaged and Women-Owned Small Business Concerns,'' or 
(2) an approved plan required by this clause, shall be a material breach 
of the contract.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 60 FR 35668, July 10, 1995; 
61 FR 39901, July 31, 1996; 62 FR 34129, June 24, 1997]



252.219-7005  Incentive for subcontracting with small businesses, small disadvantaged businesses, historically black colleges and universities, and minority 
          institutions.

    As prescribed in 219.708(c)(1), use the following clause:

Incentive for Subcontracting With Small Businesses, Small Disadvantaged 
 Businesses, Historically Black Colleges and Universities, and Minority 
                         Institutions (NOV 1995)

    (a) If the Contractor exceeds the small disadvantaged business, 
historically black college and university, minority institution goal of 
its subcontracting plan, at completion of contract performance, the 
Contractor will receive (Insert appropriate number between 1 and 10) 
percent of the excess.
    (b) The Contractor will not receive this incentive if the 
Contracting Officer determines that exceeding the goal was not due to 
the Contractor's efforts (e.g., a subcontractor cost overrun or award of 
subcontracts planned but not disclosed in the subcontracting plan). 
Determinations made under this paragraph are not subject to the Disputes 
clause.
    (c) If this is a cost contract, the limitations in FAR subpart 15.9 
may not be exceeded.
    (d) This clause does not apply if the subcontracting plan is a 
plant, division, or company-wide commercial items plan.

                             (End of clause)

                         Alternate I (Dec. 1991)

    As prescribed in 219.708(c)(1), add the following paragraph (b) to 
the basic clause and renumber the existing paragraphs (b), (c), and (d) 
as (c), (d), and (e).
    (b) If the Contractor exceeds the small business goal of its 
subcontracting plan, at completion of contract performance, the 
Contractor will receive (Insert appropriate number between 1 and 10) 
percent of the excess.
[56 FR 36479, July 31, 1991, as amended at 60 FR 61601, Nov. 30, 1995]



252.219-7006  Notice of evaluation preference for small disadvantaged business concerns.

    As prescribed in 219.7003, use the following clause:

    Notice of Evaluation Preference for Small Disadvantaged Business 
                          Concerns (June 1997)

    (a) Definitions. Historically black colleges and universities, as 
used in this clause, means institutions determined by the Secretary of 
Education to meet the requirements of 34 CFR 608.2. The term also means 
any nonprofit research institution that was an integral part of such a 
college or university before November 14, 1986.
    Minority institutions, as used in this clause, means institutions 
meeting the requirements of section 1046(3) of the Higher Education Act 
of 1965 (20 U.S.C. 1135d-5(3)). The term also includes Hispanic-serving 
institutions as defined in section 316(b)(1) of such Act (20 U.S.C. 
1059c(b)(1)).
    United States, as used in this clause, means the United States, its 
territories and possessions, the Commonwealth of Puerto Rico, the U.S. 
Trust Territory of the Pacific Islands, or the District of Columbia.
    (b) Evaluation preference. (1) Offers will be evaluated by adding a 
factor of ten percent to the price of all offers, except--
    (i) Offers from small disadvantaged business concerns, which have 
not waived the preference;

[[Page 436]]

    (ii) Offers from historically black colleges and universities or 
minority institutions, which have not waived the preference;
    (iii) Otherwise successful offers of--
    (A) Eligible products under the Trade Agreements Act when the dollar 
threshold for application of the Act is exceeded;
    (B) Qualifying country end products (as defined in the Defense 
Federal Acquisition Regulation Supplement clause at 252.225-7001, Buy 
American Act and Balance of Payments Program); and
    (iv) Offers where application of the factor would be inconsistent 
with a Memorandum of Understanding or other international agreement with 
a foreign government.
    (2) The ten percent factor will be applied on a line item by line 
item basis or to any group of items on which award may be made. Other 
evaluation factors described in the solicitation will be applied before 
application of the ten percent factor. The ten percent factor will not 
be applied if using the preference would cause the contract award to be 
made at a price which exceeds the fair market price by more than ten 
percent.
    (c) Waiver of evaluation preference. A small disadvantaged business, 
historically black college or university, or minority institution 
offeror may elect to waive the preference, in which case the ten percent 
factor will be added to its offer for evaluation purposes. The 
agreements in paragraph (d) do not apply to offers which waive the 
preference.
________ Offeror elects to waive the preference
    (d) Agreements. (1) A small disadvantaged business concern, 
historically black college or university, or minority institution 
offeror, which did not waive the preference, agrees that in performance 
of the contract, in the case of a contract for--
    (i) Services, except construction, at least 50 percent of the cost 
of personnel for contract performance will be spent for employees of the 
concern.
    (ii) Supplies (other than procurement from a regular dealer in such 
supplies), at least 50 percent of the cost of manufacturing, excluding 
the cost of materials, will be performed by the concern.
    (iii) General construction, at least 15 percent of the cost of the 
contract, excluding the cost of materials, will be performed by 
employees of the concern.
    (iv) Construction by special trade contractors, at least 25 percent 
of the cost of the contract, excluding the cost of materials, will be 
performed by employees of the concern.
    (2) A small disadvantaged business, historically black college or 
university, or minority institution regular dealer submitting an offer 
in its own name agrees to furnish in performing this contract only end 
items manufactured or produced in the United States by small 
disadvantaged business concerns, historically black colleges or 
universities, or minority institutions.
    (3) Upon request, a historically black college or university or 
minority institution offeror will provide the Contracting Officer 
evidence that it has been determined to be an HBCU or MI by the 
Secretary of Education.

                             (End of clause)

                         ALTERNATE I (JUNE 1997)

    As prescribed in 219.7003, substitute the following paragraph (d)(2) 
for paragraph (d)(2) of the basic clause:
    (d)(2) A small disadvantaged business, historically black college or 
university, or minority institution regular dealer submitting an offer 
in its own name agrees to furnish in performing this contract only end 
items manufactured or produced in the United States by small business 
concerns, historically black colleges or universities, or minority 
institutions.
[56 FR 36479, July 31, 1991, as amended at 59 FR 22131, Apr. 29, 1994; 
59 FR 24959, May 13, 1994; 60 FR 29502, June 5, 1995; 62 FR 34129, June 
24, 1997]



252.219-7007  [Reserved]



252.219-7008  Notice of evaluation preference for small disadvantaged business concerns--construction acquisitions--test program.

    As prescribed in 219.7204, use the following clause:

    Notice of Evaluation Preference for Small Disadvantaged Business 
      Concerns--Construction Acquisitions--Test Program (APR 1996)

    (a) Definitions.
    As used in this clause--
    ``Historically black colleges and universities (HBCUs),'' means 
institutions determined by the Secretary of Education to meet the 
requirements of 34 CFR Section 608.2. The term also means any nonprofit 
research institution that was an integral part of such a college or 
university before November 14, 1986.
    ``Minority institutions,'' means institutions meeting the 
requirements of paragraphs (3), (4), and (5) of Section 1046(3) of the 
Higher Education Act of 1965 (20 U.S.C. 1135d-5(3)). The term also 
includes Hispanic-serving institutions as defined in Section 316(b)(1) 
of such Act (20 U.S.C. 1059c(b)(1)).
    ``Small disadvantaged business (SDB) concern,'' means a small 
business concern, owned and controlled by individuals who are

[[Page 437]]

both socially and economically disadvantaged, as defined by the Small 
Business Administration at 13 CFR Part 124, the majority of earnings of 
which directly accrue to such individuals. This term also means a small 
business concern owned and controlled by an economically disadvantaged 
Indian tribe or Native Hawaiian organization which meets the 
requirements of 13 CFR 124.112 or 13 CFR 124.113, respectively.
    (b) Evaluation preference.
    (1) Offerors shall separately state bond costs in the offer. Bond 
costs include the costs of bid, performance, and payment bonds.
    (2) Offers will be evaluated initially based on their total prices. 
If the apparently successful offeror is an SDB concern, no preference-
based evaluation will be conducted.
    (3) If the apparently successful offeror is not an SDB concern, 
offers will be evaluated based on their prices excluding bond costs. If, 
after excluding bond costs, the apparently successful offeror is an SDB 
concern, bond costs will be added back to all offers, and offers from 
SDB concerns will be given a preference in evaluation by adding a factor 
of 10 percent to the total price of all offers, except--
    (i) Offers from SDBs which have not waived the evaluation 
preference; and
    (ii) Offers from HBCUs or minority institutions, which have not 
waived the evaluation preference.
    (c) Waiver of evaluation preference.
    A small disadvantaged business, historically black college or 
university, or minority institution offeror may elect to waive the 
preference. The agreements in paragraph (d) of this clause do not apply 
to offers which waive the preference.
    ________ Offeror elects to waive the preference.
    (d) Agreements.
    A small disadvantaged business concern, historically black college 
or university, or minority institution offeror, which did not waive the 
preference, agrees that in performance of the contract, in the case of a 
contract for--
    (i) General construction, at least 15 percent of the cost of the 
contract, excluding the cost of materials, will be performed by 
employees of the concern.
    (ii) Construction by special trade contractors, at least 25 percent 
of the cost of the contract, excluding the cost of materials, will be 
performed by employees of the concern.
(End of clause)
[61 FR 18688, Apr. 29, 1996]



252.222-7000  Restrictions on employment of personnel.

    As prescribed in 222.7003, use the following clause:

           Restrictions on Employment of Personnel (Dec. 1991)

    (a) The Contractor shall employ, for the purposes of performing that 
portion of the contract work in the State of (insert appropriate State), 
individuals who are residents of the State, and who, in the case of any 
craft or trade, possess or would be able to acquire promptly the 
necessary skills to perform the contract.
    (b) The Contractor agrees to insert the substance of this clause, 
including this paragraph (b), in each subcontract.

                             (End of clause)



252.222-7001  Right of First Refusal of Employment--Closure of Military Installations.

    As prescribed in 222.7102, use the following clause:

Right of First Refusal of Employment--Closure of Military Installations 
                               (Apr. 1992)

    (a) The Contractor shall give Government employees, who have been or 
will be adversely affected by the closure of the military installation 
where this contract will be performed, the right of first refusal for 
employment openings under the contract. This right applies to positions 
for which the employee is qualified, if consistent with post-Government 
employment conflict of interest standards.
    (b) Government personnel seeking preference under this clause shall 
provide the Contractor with evidence from the Government personnel 
office.

                             (End of clause)

[57 FR 52594, Nov. 4, 1992, as amended at 58 FR 28472, May 13, 1993]



252.222-7002  Compliance with local labor laws (overseas).

    As prescribed in 222.7201(a), use the following clause:

        Compliance with Local Labor Laws (Overseas) (JUNE 1997 )

    (a) The Contractor shall comply with all--
    (1) Local laws, regulations, and labor union agreements governing 
work hours; and
    (2) Labor regulations including collective bargaining agreements, 
workers' compensation, working conditions, fringe benefits, and labor 
standards or labor contract matters.
    (b) The Contractor indemnifies and holds harmless the United States 
Government from all claims arising out of the requirements of this 
clause. This indemnity includes the Contractor's obligation to handle

[[Page 438]]

and settle, without cost to the United States Government, any claims or 
litigation concerning allegations that the Contractor or the United 
States Government, or both, have not fully complied with local labor 
laws or regulations relating to the performance of work required by this 
contract.
    (c) Notwithstanding paragraph (b) of this clause, consistent with 
paragraphs 31.205-15(a) and 31.205-47(d) of the Federal Acquisition 
Regulation, the Contractor will be reimbursed for the costs of all 
fines, penalties, and reasonable litigation expenses incurred as a 
result of compliance with specific contract terms and conditions or 
written instructions from the Contracting officer.

                             (End of clause)

[62 FR 34129, June 24, 1997]



252.222-7003  Permit from Italian Inspectorate of Labor.

    As prescribed in 222.7201(b), use the following clause:

          Permit from Italian Inspectorate of Labor (JUNE 1997)

    Prior to the date set for commencement of work and services under 
this contract, the Contractor shall obtain the prescribed permit from 
the Inspectorate of Labor having jurisdiction over the work site, in 
accordance with Article 5g of Italian Law Number 1369, dated October 23, 
1960. The Contractor shall ensure that a copy of the permit is available 
at all reasonable times for inspection by the Contracting Officer or an 
authorized representative. Failure to obtain such permit may result in 
termination of the contract for the convenience of the United States 
Government, at no cost to the United States Government.

                             (End of clause)

[62 FR 34129, June 24, 1997]



252.222-7004  Compliance with Spanish social security laws and regulations.

    As prescribed in 222.7201(c), use the following clause:

Compliance with Spanish Social Security Laws and Regulations (JUNE 1997)

    (a) The Contractor shall comply with all Spanish Government social 
security laws and regulations. Within 30 calendar days after the start 
of contract performance, the Contractor shall ensure that copies of the 
documents identified in paragraph (a)(1) through (a)(5) of this clause 
are available at all reasonable times for inspection by the Contracting 
Officer or an authorized representative. The Contractor shall retain the 
records in accordance with the Audit and Records clause of this 
contract.
    (1) TC1--Certificate of Social Security Payments;
    (2) TC2--List of Employees;
    (3) TC2/1--Certificate of Social Security Payments for Trainees;
    (4) Nominal (pay statements) signed by both the employee and the 
Contractor; and
    (5) Informa de Situacion de Empressa (Report of the Condition of the 
Enterprise) from the Ministerio de Trabajo y S.S., Tesoreria General de 
la Seguridad Social (annotated with the pertinent contract number(s) 
next to the employee's name).
    (b) All TC1's, TC2's, and TC2/1's shall contain a representation 
that they have been paid by either the Social Security Administration 
office or the Contractor's bank or savings institution. Failure by the 
Contractor to comply with the requirements of this clause may result in 
termination of the contract under the clause of the contract entitled 
``Default.''

                             (End of clause)

[62 FR 34129, June 24, 1997]



252.223-7000  [Reserved]



252.223-7001  Hazard warning labels.

    As prescribed in 223.303, use the following clause:

                    Hazard Warning Labels (Dec. 1991)

    (a) ``Hazardous material,'' as used in this clause, is defined in 
the Hazardous Material Identification and Material Safety Data clause of 
this contract.
    (b) The Contractor shall label the item package (unit container) of 
any hazardous material to be delivered under this contract in accordance 
with the Hazard Communication Standard (29 CFR 1910.1200 et seq). The 
Standard requires that the hazard warning label conform to the 
requirements of the standard unless the material is otherwise subject to 
the labelling requirements of one of the following statutes:
    (1) Federal Insecticide, Fungicide and Rodenticide Act;
    (2) Federal Food, Drug and Cosmetics Act;
    (3) Consumer Product Safety Act;
    (4) Federal Hazardous Substances Act; or
    (5) Federal Alcohol Administration Act.
    (c) The Offeror shall list which hazardous material listed in the 
Hazardous Material Identification and Material Safety Data clause of 
this contract will be labelled in accordance with one of the Acts in 
paragraphs (b) (1) through (5) of this clause instead of the Hazard 
Communication Standard. Any

[[Page 439]]

hazardous material not listed will be interpreted to mean that a label 
is required in accordance with the Hazard Communication Standard.

                                                                        
------------------------------------------------------------------------
   Material (if none, insert ``none.'')                  Act            
------------------------------------------------------------------------
________                                    ________                    
________                                    ________                    
------------------------------------------------------------------------

    (d) The apparently successful Offeror agrees to submit, before 
award, a copy of the hazard warning label for all hazardous materials 
not listed in paragraph (c) of this clause. The Offeror shall submit the 
label with the Material Safety Data Sheet being furnished under the 
Hazardous Material Identification and Material Safety Data clause of 
this contract.
    (e) The Contractor shall also comply with MIL-STD-129, Marking for 
Shipment and Storage (including revisions adopted during the term of 
this contract).

                             (End of clause)



252.223-7002  Safety precautions for ammunition and explosives.

    As prescribed in 223.370-5, use the following clause:

       Safety Precautions for Ammunition and Explosives (May 1994)

    (a) Definition. Ammunition and explosives, as used in this clause--
    (1) Means liquid and solid propellants and explosives, pyrotechnics, 
incendiaries and smokes in the following forms:
    (i) Bulk,
    (ii) Ammunition;
    (iii) Rockets;
    (iv) Missiles;
    (v) Warheads;
    (vi) Devices; and
    (vii) Components of (i) through (vi), except for wholly inert items.
    (2) This definition does not include the following, unless the 
Contractor is using or incorporating these materials for initiation, 
propulsion, or detonation as an integral or component part of an 
explosive, an ammunition or explosive end item, or of a weapon system--
    (i) Inert components containing no explosives, propellants, or 
pyrotechnics;
    (ii) Flammable liquids;
    (iii) Acids;
    (iv) Oxidizers;
    (v) Powdered metals; or
    (vi) Other materials having fire or explosive characteristics.
    (b) Safety requirements. (1) The Contractor shall comply with the 
requirements of the DoD Contractors' Safety Manual for Ammunition and 
Explosives, DoD 4145.26-M, hereafter referred to as ``the manual,'' in 
effect on the date of the solicitation for this contract. The Contractor 
shall also comply with any other additional requirements included in the 
schedule of this contract.
    (2) The Contractor shall allow the Government access to the 
Contractor's facilities, personnel, and safety program documentation. 
The Contractor shall allow authorized Government representatives to 
evaluate safety programs, implementation, and facilities.
    (c) Noncompliance with the manual. (1) If the Contracting Officer 
notifies the Contractor of any noncompliance with the manual or schedule 
provisions, the Contractor shall take immediate steps to correct the 
noncompliance. The Contractor is not entitled to reimbursement of costs 
incurred to correct noncompliances unless such reimbursement is 
specified elsewhere in the contract.
    (2) The Contractor has 30 days from the date of notification by the 
Contracting Officer to correct the noncompliance and inform the 
Contracting Officer of the actions taken. The Contracting Officer may 
direct a different time period for the correction of noncompliances.
    (3) If the Contractor refuses or fails to correct noncompliances 
within the time period specified by the Contracting Officer, the 
Government has the right to direct the Contractor to cease performance 
on all or part of this contract. The Contractor shall not resume 
performance until the Contracting Officer is satisfied that the 
corrective action was effective and the Contracting Officer so informs 
the Contractor.
    (4) The Contracting Officer may remove Government personnel at any 
time the Contractor is in noncompliance with any safety requirement of 
this clause.
    (5) If the direction to cease work or the removal of Government 
personnel results in increased costs to the Contractor, the Contractor 
shall not be entitled to an adjustment in the contract price or a change 
in the delivery or performance schedule unless the Contracting Officer 
later determines that the Contractor had in fact complied with the 
manual or schedule provisions. If the Contractor is entitled to an 
equitable adjustment, it shall be made in accordance with the Changes 
clause of this contract.
    (d) Mishaps. If a mishap involving ammunition or explosives occurs, 
the Contractor shall--
    (1) Notify the Contracting Officer immediately;
    (2) Conduct an investigation in accordance with other provisions of 
this contract or as required by the Contracting Officer; and
    (3) Submit a written report to the Contracting Officer.
    (e) Contractor responsibility for safety. (1) Nothing in this 
clause, nor any Government action or failure to act in surveillance of 
this contract, shall relieve the Contractor of its responsibility for 
the safety of--

[[Page 440]]

    (i) The Contractor's personnel and property;
    (ii) The Government's personnel and property; or
    (iii) The general public.
    (2) Nothing in this clause shall relieve the Contractor of its 
responsibility for complying with applicable Federal, State, and local 
laws, ordinances, codes, and regulations (including those requiring the 
obtaining of licenses and permits) in connection with the performance of 
this contract.
    (f) Contractor responsibility for contract performance. (1) Neither 
the number or frequency of inspections performed by the Government, nor 
the degree of surveillance exercised by the Government, relieve the 
Contractor of its responsibility for contract performance.
    (2) If the Government acts or fails to act in surveillance or 
enforcement of the safety requirements of this contract, this does not 
impose or add to any liability of the Government.
    (g) Subcontractors. (1) The Contractor shall insert this clause, 
including this paragraph (g), in every subcontract that involves 
ammunition or explosives.
    (i) The clause shall include a provision allowing authorized 
Government safety representatives to evaluate subcontractor safety 
programs, implementation, and facilities as the Government determines 
necessary.
    (ii) Note: The Government Contracting Officer or authorized 
representative shall notify the prime Contractor of all findings 
concerning subcontractor safety and compliance with the manual. The 
Contracting Officer or authorized representative may furnish copies to 
the subcontractor. The Contractor in turn shall communicate directly 
with the subcontractor, substituting its name for references to ``the 
Government''. The Contractor and higher tier subcontractors shall also 
include provisions to allow direction to cease performance of the 
subcontract if a serious uncorrected or recurring safety deficiency 
potentially causes an imminent hazard to DoD personnel, property, or 
contract performance.
    (2) The Contractor agrees to ensure that the subcontractor complies 
with all contract safety requirements. The Contractor will determine the 
best method for verifying the adequacy of the subcontractor's 
compliance.
    (3) The Contractor shall ensure that the subcontractor understands 
and agrees to the Government's right to access to the subcontractor's 
facilities, personnel, and safety program documentation to perform 
safety surveys. The Government performs these safety surveys of 
subcontractor facilities solely to prevent the occurrence of any mishap 
which would endanger the safety of DoD personnel or otherwise adversely 
impact upon the Government's contractual interests.
    (4) The Contractor shall notify the Contracting Officer or 
authorized representative before issuing any subcontract when it 
involves ammunition or explosives. If the proposed subcontract 
represents a change in the place of performance, the Contractor shall 
request approval for such change in accordance with the clause of this 
contract entitled ``Change in Place of Performance--Ammunition and 
Explosives''.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 59 FR 27675, May 27, 1994]



252.223-7003  Change in place of performance--ammunition and explosives.

    As prescribed in 223.370-5, use the following clause:

  Change in Place of Performance--Ammunition and Explosives (Dec. 1991)

    (a) The Offeror shall identify, in the ``Place of Performance'' 
provision of this solicitation, the place of performance of all 
ammunition and explosives work covered by the Safety Precautions for 
Ammunition and Explosives clause of this solicitation. Failure to 
furnish this information with the offer may result in rejection of the 
offer.
    (b) The Offeror agrees not to change the place of performance of any 
portion of the offer covered by the Safety Precautions for Ammunition 
and Explosives clause contained in this solicitation after the date set 
for receipt of offers without the written approval of the Contracting 
Officer. The Contracting Officer shall grant approval only if there is 
enough time for the Government to perform the necessary safety reviews 
on the new proposed place of performance.
    (c) If a contract results from this offer, the Contractor agrees not 
to change any place of performance previously cited without the advance 
written approval of the Contracting Officer.

                             (End of clause)



252.223-7004  [Reserved]



252.223-7005  Hazardous waste liability.

    As prescribed in 223.7002, use the following clause:

                  Hazardous Waste Liability (Oct. 1992)

    (a) Definitions.
    As used in this clause--
    (1) Hazardous waste has the meaning given that term by section 
1004(5) of the Solid Waste Disposal Act (42 U.S.C. 6903(5)), except

[[Page 441]]

that such term also includes polychlorinated biphenyls (PCB).
    (2) Polychlorinated biphenyls (PCB) has the meaning given that term 
under section 6(e) of the Toxic Substances Control Act (15 U.S.C. 
2605(e)).
    (b) Upon receipt of hazardous waste properly characterized pursuant 
to applicable laws and regulations, the Contractor agrees that it shall 
reimburse the Government for any penalties assessed against, all 
liabilities incurred by, costs incurred by, and damages suffered by, the 
Government that are caused by--
    (1) The Contractor's breach of any term of the contract; or
    (2) Any negligent or willful act or omission of the Contractor or 
employees of the Contractor, in the performance of the contract.
    (c) Not later than 30 days after the award date of the contract, the 
Contractor shall demonstrate the ability to reimburse the Government as 
provided in paragraph (b) of this clause, by providing evidence to the 
Contracting Officer that--
    (1) The facility has liability insurance meeting the requirements of 
40 CFR 264.147; or
    (2) The facility meets the financial assurance requirements of 40 
CFR 264.147 for sudden and nonsudden accidental occurrences.
    (d) This clause does not apply to--
    (1) Performance of remedial action or corrective action under--
    (i) The Defense Environmental Restoration Program;
    (ii) Other programs or activities of the Department of Defense; or
    (iii) Authorized State hazardous waste programs;
    (2) Disposal of hazardous waste when the generation of such waste is 
incidental to the performance of the contract: or
    (3) Disposal of ammunition or solid rocket motors.
    (e) The Contractor shall include this clause, including this 
paragraph (e), in each subcontract under which the subcontractor 
receives hazardous waste from a defense facility.

                             (End of clause)

[57 FR 53601, Nov. 12, 1992; 58 FR 40388, July 28, 1993]



Sec. 252.223-7006  Prohibition on storage and disposal of toxic and hazardous materials.

    As prescribed in 223.7103(a), use the following clause:

  Prohibition on Storage and Disposal of Toxic and Hazardous Materials 
                               (Apr. 1993)

    (a) Definitions.
    As used in this clause--
    (1) Storage means a non-transitory, semi-permanent or permanent 
holding, placement, or leaving of material. It does not include a 
temporary accumulation of a limited quantity of a material used in or a 
waste generated or resulting from authorized activities, such as 
servicing, maintenance, or repair of Department of Defense (DoD) items, 
equipment, or facilities.
    (2) Toxic or hazardous materials means:
    (i) Materials referred to in section 101(14) of the Comprehensive 
Environmental Response, Compensation, and Liability Act (CERCLA) of 1980 
(42 U.S.C. 9601(14)) and materials designated under section 102 of 
CERCLA (42 U.S.C. 9602) (40 CFR part 302);
    (ii) Materials that are of an explosive, flammable, or pyrotechnic 
nature; or
    (iii) Materials otherwise identified by the Secretary of Defense as 
specified in DoD regulations.
    (b) In accordance with 10 U.S.C. 2692, the Contractor is prohibited 
from storing or disposing of non-DoD-owned toxic or hazardous materials 
on a DoD installation, except to the extent authorized by a statutory 
exception to 10 U.S.C. 2692 or as authorized by the Secretary of Defense 
or his designee.

                         Alternate I (NOV 1995)

    As prescribed in 223.7103(b), add the following paragraphs (c) and 
(d) to the basic clause:

    (c) With respect to treatment or disposal authorized pursuant to 10 
U.S.C. 2692(b)(9), and notwithstanding any other provision of the 
contract, the Contractor assumes all financial and environmental 
responsibility and liability resulting from any treatment or disposal of 
non-DoD-owned toxic or hazardous materials on a military installation. 
The Contractor shall indemnify, defend, and hold the Government harmless 
for all costs, liability, or penalties resulting from the Contractor's 
treatment or disposal of non-DoD-owned toxic or hazardous materials on a 
military installation.
    (d) The Contractor shall include this clause, including this 
paragraph (d), in each subcontract which requires, may require, or 
permits a subcontractor to treat or dispose of non-DoD-owned toxic or 
hazardous materials as defined in this clause.
[58 FR 28472, May 13, 1993, as amended at 60 FR 13076, Mar. 10, 1995; 60 
FR 61601, Nov. 30, 1995]



252.223-7007  Safeguarding sensitive conventional arms, ammunition, and explosives.

    As prescribed in 223.7203, use the following clause:

[[Page 442]]

  Safeguarding Sensitive Conventional Arms, Ammunition, and Explosives 
                               (FEB 1996)

    (a) Definition.
    ``Arms, ammunition, and explosives (AA&E),'' as used in this clause, 
means those items within the scope (chapter 1, paragraph B) of DoD 
5100.76-M, Physical Security of Sensitive Conventional Arms, Ammunition, 
and Explosives.
    (b) The requirements of DoD 5100.76-M apply to the following items 
of AA&E being developed, produced, manufactured, or purchased for the 
Government, or provided to the Contractor as Government-furnished 
property under this contract:

                                                                        
------------------------------------------------------------------------
                                                  National              
                 Nomenclature                      stock     Sensitivity
                                                   number      category 
------------------------------------------------------------------------
                                                                        
                                                                        
------------------------------------------------------------------------

    (c) The Contractor shall comply with the requirements of DoD 
5100.76-M, as specified in the statement of work. The edition of DoD 
5100.76-M in effect on the date of issuance of the solicitation for this 
contract shall apply.
    (d) The Contractor shall allow representatives of the Defense 
Investigative Service (DIS), and representatives of other appropriate 
offices of the Government, access at all reasonable times into its 
facilities and those of its subcontractors, for the purpose of 
performing surveys, inspections, and investigations necessary to review 
compliance with the physical security standards applicable to this 
contract.
    (e) The Contractor shall notify the cognizant DIS field office of 
any subcontract involving AA&E within 10 days after award of the 
subcontract.
    (f) The Contractor shall ensure that the requirements of this clause 
are included in all subcontracts, at every tier--
    (1) For the development, production, manufacture, or purchase of 
AA&E or
    (2) When AA&E will be provided to the subcontractor as Government-
furnished property.
    (g) Nothing in this clause shall relieve the Contractor of its 
responsibility for complying with applicable Federal, state, and local 
laws, ordinances, codes, and regulations (including requirements for 
obtaining licenses and permits) in connection with the performance of 
this contract.

(End of clause)
[61 FR 7750, Feb. 29, 1996]



252.225-7000  Buy American Act--Balance of Payments Program Certificate.

    As prescribed in 225.109(a), use the following provision:

  Buy American Act--Balance of Payments Program Certificate (Dec. 1991)

    (a) Definitions. Domestic end product, qualifying country, 
qualifying country end product, and qualifying country end product have 
the meanings given in the Buy American Act and Balance of Payments 
Program clause of this solicitation.
    (b) Evaluation. Offers will be evaluated by giving preference to 
domestic end products and qualifying country end products over 
nonqualifying country end products.
    (c) Certifications. (1) The Offeror certifies that--
    (i) Each end product, except those listed in paragraphs (c) (2) or 
(3) of this clause, is a domestic end product; and
    (ii) Components of unknown origin are considered to have been mined, 
produced, or manufactured outside the United States or a qualifying 
country.
    (2) The Offeror certifies that the following end products are 
qualifying country end products:

                     Qualifying Country End Products                    
------------------------------------------------------------------------
               Line item No.                      Country of origin     
------------------------------------------------------------------------
________                                    ________                    
------------------------------------------------------------------------

(List only qualifying country end products.)

    (3) The Offeror certifies that the following end products are 
nonqualifying country end products:

                   Nonqualifying Country End Products                   
------------------------------------------------------------------------
               Line item No.                Country of origin (If known)
------------------------------------------------------------------------
________                                    ________                    
------------------------------------------------------------------------

                           (End of provision)



252.225-7001  Buy American Act and Balance of Payments Program.

    As prescribed in 225.109(d), use the following clause:

      Buy American Act and Balance of Payments Program (Jan. 1994)

    (a) Definitions. (1) Components means those articles, materials, and 
supplies directly incorporated into end products.
    (2) Qualifying country means any country set forth in subsection 
225.872-1 of the Defense FAR Supplement.
    (3) Qualifying country component means an item mined, produced, or 
manufactured in a qualifying country.
    (4) End product means those articles, materials, and supplies to be 
acquired for public use under the contract. For this contract, the end 
products are the line items to be delivered to the Government (including 
supplies to be acquired by the Government for

[[Page 443]]

public use in connection with service contracts, but excluding 
installation and other services to be performed after delivery).
    (5) Domestic end product means--
    (i) An unmanufactured end product which has been mined or produced 
in the United States; or
    (ii) An end product manufactured in the United States if the cost of 
its qualifying country components and its components which are mined, 
produced, or manufactured in the United States exceeds 50 percent of the 
cost of all its components. The cost of components shall include 
transportation costs to the place of incorporation into the end product 
and U.S. duty (whether or not a duty-free entry certificate may be 
issued). Consider a component to have been mined, produced, or 
manufactured in the United States (regardless of its source in fact) if 
the end product in which it is incorporated is manufactured in the 
United States and the component is of a class or kind--
    (A) Determined to be not mined, produced, or manufactured in the 
United States in sufficient and reasonably available commercial 
quantities and of a satisfactory quality; or
    (B) Which the Secretary concerned determines would be inconsistent 
with the public interest to apply the restrictions of the Buy American 
Act.
    (6) Nonqualifying country end product means an end product which is 
neither a domestic end product nor a qualifying country end product.
    (7) Qualifying country end product means--
    (i) An unmanufactured end product mined or produced in a qualifying 
country; or
    (ii) An end product manufactured in a qualifying country if the cost 
of the components mined, produced, or manufactured in the qualifying 
country and its components mined, produced, or manufactured in the 
United States exceeds 50 percent of the cost of all its components.
    (b) This clause implements the Buy American Act (41 U.S.C. 10a-d) in 
a manner that will encourage a favorable international balance of 
payments by providing a preference to domestic end products over other 
end products, except for end products which are qualifying country end 
products.
    (c) The Contractor agrees that it will deliver only domestic end 
products unless, in its offer, it specified delivery of other end 
products in the Buy American Act and Balance of Payments Certificate or 
the Buy American Act--Trade Agreements--Balance of Payments Program 
Certificate. An offer certifying that a qualifying country end product 
will be supplied requires the Contractor to deliver a qualifying country 
end product or a domestic end product.
    (d) The offered price of nonqualifying country end products must 
include all applicable duty. Generally, when the Buy American Act is 
applicable, each nonqualifying country offer is adjusted for the purpose 
of evaluation by adding 50 percent of the offer, inclusive of duty.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 59 FR 1290, Jan. 10, 1994]



252.225-7002  Qualifying country sources as subcontractors.

    As prescribed in 225.109-70(a), use the following clause:

        Qualifying Country Sources as Subcontractors (Dec. 1991)

    Subject to the restrictions in section 225.872 of the Defense FAR 
Supplement, the Contractor shall not preclude qualifying country sources 
and U.S. sources from competing for subcontracts under this contract.

                             (End of clause)



252.225-7003  Information for duty-free entry evaluation.

    As prescribed in 225.109-70(b), use the following provision:

         Information for Duty-Free Entry Evaluation (Aug. 1992)

    (a) Is the offer based on furnishing any supplies (i.e., end items, 
components, or material) of foreign origin other than those for which 
duty-free entry is to be accorded pursuant to the Duty-Free Entry--
Qualifying Country End Products and Supplies clause of this 
solicitation?
Yes (  )
No (  )

    (b) If the answer in paragraph (a) is yes, answer the following 
questions:
    (1) Are such foreign supplies now in the United States?

Yes (  )
No (  )
    (2) Has the duty on such foreign supplies been paid?

Yes (  )
No (  )
    (3) If the answer to paragraph (b)(2) is no, what amount is included 
in the offer to cover such duty? $______
    (c) If the duty has not been paid, the Government may elect to make 
award on a duty-free basis. If so, the offered price will be reduced in 
the contract award by the amount specified in paragraph (b)(3). The 
Offeror agrees to identify, at the request of the Contracting Officer, 
the foreign supplies which are subject to duty-free entry.
    (d) Offers will be evaluated on a duty included basis except to the 
extent that--

[[Page 444]]

    (1) The supplies are qualifying country end products as defined in 
the Buy American Act and Balance of Payments Program clause of this 
solicitation; or

    (2) The duty-free price is specified for use in the evaluation 
procedure.

                           (End of provision)

[56 FR 36479, July 31, 1991, as amended at 57 FR 42633, Sept. 15, 1992]



252.225-7004  [Reserved]



252.225-7005  Identification of expenditures in the United States.

    As prescribed in 225.305-70, use the following clause:

     Identification of Expenditures in the United States (Dec. 1991)

    (a) On each invoice, voucher, or other request for payment under 
this contract, the Contractor shall identify that part of the requested 
payment which represents estimated expenditures in the United States. 
The identification--
    (1) May be expressed either as dollar amounts or as percentages of 
the total amount of the request for payment.
    (2) Should be based on reasonable estimates.
    (3) Shall consist of stating the full amount of the payment 
requested, subdivided into the following categories:
    (i) U.S. products--expenditures for material and equipment 
manufactured or produced in the United States, excluding transportation;
    (ii) U.S. services--expenditures for services performed in the 
United States, including charges for overhead, other indirect costs, and 
profit;
    (iii) Transportation on U.S. carriers--expenditures for 
transportation furnished by U.S. flag, ocean, surface, and air carriers; 
and
    (iv) Expenditures not identified under paragraphs (a) (1), (2), and 
(3).
    (b) If this contract is principally for supplies or if the 
Contractor is not an incorporated concern incorporated in the United 
States, or an unincorporated concern having its principal place of 
business in the United States, the amounts identified under paragraphs 
(a)(3) (i), (ii), and (iii) will be limited to payments made pursuant to 
the requirements either of the United States Products and Services 
clause, if any, or of any other specific provision of this contract that 
obligates the Contractor to acquire certain materials, equipment, 
transportation, or services from U.S. sources.
    (c) Nothing in this clause requires the establishment or maintenance 
of detailed accounting records or gives the U.S. Government any right to 
audit the Contractor's books or records.

                             (End of clause)



252.225-7006  Buy American Act--trade agreements--Balance of Payments Program certificate.

    As prescribed in 225.408(a)(1), use the following provision:

    Buy American Act--Trade Agreements--Balance of Payments Program 
                         Certificate (JUNE 1997)

    (a) Definitions. ``Caribbean Basin country end product,'' 
``designated country end product,'' ``domestic end product,'' ``NAFTA 
country end product,'' ``nondesignated country end product,'' 
``qualifying country end product,'' and ``U.S. made end product'' have 
the meanings given in the Trade Agreements and the Buy American Act and 
Balance of Payments Program clauses of this solicitation.
    (b) Evaluation. Offers will be evaluated in accordance with the 
policies and procedures of Part 225 of the Defense Federal Acquisition 
Regulation Supplement. Offers of foreign end products that are not U.S. 
made, qualifying country, designated country, Caribbean Basin country, 
or NAFTA country end products will not be considered for award, unless 
the Contracting Officer determines that there are no offers of such end 
products; or the offers of such end products are insufficient to fulfill 
the requirements; or a national interest exception to the Trade 
Agreements Act is granted.
    (c) Certifications. (1) The Offeror certifies that--
    (i) Each end product, except the end products listed in paragraph 
(c)(2) of this provision, is a domestic end product (as defined in the 
Buy American Act and Balance of Payments Program clause of this 
solicitation); and
    (ii) Components of unknown origin are considered to have been mined, 
produced, or manufactured outside the United States or a qualifying 
country.
    (2) The Offeror must identify and certify all end products that are 
not domestic end products.
    (i) The Offeror certifies that the following supplies qualify as 
``U.S. made end products'' but do not meet the definition of ``domestic 
end product'':

(insert line item number)

 _______________________________________________________________________

    (ii) The Offeror certifies that the following supplies are 
qualifying country end products:

(insert line item number)

 _______________________________________________________________________
(insert country of origin)


[[Page 445]]


 _______________________________________________________________________

    (iii) The Offeror certifies that the following supplies qualify as 
designated country end products:

(insert line item number)
 _______________________________________________________________________
(insert country of origin)

 _______________________________________________________________________

    (iv) The Offeror certifies that the following supplies qualify as 
Caribbean Basin country end products:

(insert line item number)

 _______________________________________________________________________

(insert country of origin)

 _______________________________________________________________________

    (v) The Offeror certifies that the following supplies qualify as 
NAFTA country end products:

(insert line item number)
 _______________________________________________________________________

(insert country of origin)
 _______________________________________________________________________

    (vi) The Offeror certifies that the following supplies are other 
nondesignated country end products.

(insert line item number)

 _______________________________________________________________________

(insert country of origin)
 _______________________________________________________________________

                           (End of provision)

[62 FR 34129, June 24, 1997]



252.225-7007  Trade agreements.

    As prescribed in 225.408(a)(2), use the following clause:

                       Trade Agreements (JUL 1997)

    (a) Definitions. As used in this clause--
    (1) ``Caribbean Basin country'' means--

Antigua and Barbuda
Aruba
Bahamas
Barbados
Belize
British Virgin Islands
Costa Rica
Dominica
Dominican Republic
El Salvador
Grenada
Guatemala
Guyana
Haiti
Honduras
Jamaica
Montserrat
Netherlands Antilles
Nicaragua
Panama
St. Kitts-Nevis
St. Lucia
St. Vincent and the Grenadines
Trinadad and Tobago

    (2) ``Caribbean Basin country end product''--
    (i) Means an article that--
    (A) Is wholly the growth, product, or manufacture of a Caribbean 
Basin country; or
    (B) In the case of an article that consists in whole or in part of 
materials from another country or instrumentality, has been 
substantially transformed in a Caribbean Basin country into a new and 
different article of commerce with a name, character, or use distinct 
from that of the article or articles from which it was so transformed. 
The term refers to a product offered for purchase under a supply 
contract, but for purposes of calculating the value of the end product 
includes services (except transportation services) incidental to its 
supply, provided that the value of those incidental services does not 
exceed the value of the product itself.
    (ii) Excludes products, other than petroleum and any product derived 
from petroleum, that are not granted duty-free treatment under the 
Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(b)). These 
exclusions presently consist of--
    (A) Textiles and apparel articles that are subject to textile 
agreements;
    (B) Footwear, handbags, luggage, flat goods, work gloves, and 
leather wearing apparel not designated as eligible articles for the 
purpose of the Generalized System of Preferences under Title V of the 
Trade Act of 1974;
    (C) Tuna, prepared or preserved in any manner in airtight 
containers; and
    (D) Watches and watch parts (including cases, bracelets, and straps) 
of whatever type, including, but not limited to, mechanical, quartz 
digital, or quartz analog, if such watches or watch parts contain any 
material that is the product of any country to which Harmonized Tariff 
Schedule column 2 rates of duty apply.
    (3) ``Components,'' ``domestic end product,'' ``end product,'' 
``nonqualifying country,'' ``qualifying country,'' and ``qualifying 
country end product'' have the meanings given in the Buy American Act 
and Balance of Payments Program clause of this contract.
    (4) ``Designated country'' means--

Aruba
Austria
Bangladesh
Belgium
Benin
Bhutan
Botswana
Burkina Faso
Burundi
Canada
Cape Verde

[[Page 446]]

Central African Republic
Chad
Comoros
Denmark
Djibouti
Equatorial Guinea
Finland
France
Gambia
Germany
Greece
Guinea
Guinea-Bissau
Haiti
Hong Kong
Ireland
Israel
Italy
Japan
Kiribati
Lesotho
Liechtenstein
Luxembourg
Malawi
Maldives
Mali
Mozambique
Nepal
Netherlands
Niger
Norway
Portugal
Republic of Korea
Rwanda
Sao Tome and Principe
Sierra Leone
Singapore
Somalia
Spain
Sweden
Switzerland
Tanzania U.R.
Togo
Tuvalu
Uganda
United Kingdom
Vanuatu
Western Samoa
Yemen

    (5) ``Designated country end product'' means an article that--
    (i) Is wholly the growth, product, or manufacture of the designated 
country; or
    (ii) In the case of an article that consists in whole or in part of 
materials from another country or instrumentality, has been 
substantially transformed in a designated country into a new and 
different article of commerce with a name, character, or use distinct 
from that of the article or articles from which it was so transformed. 
The term refers to a product offered for purchase under a supply 
contract, but for purposes of calculating the value of the end product 
includes services (except transportation services) incidental to its 
supply, provided that the value of those incidental services does not 
exceed the value of the product itself.
    (6) ``NAFTA country end product'' means an article that--
    (i) Is wholly the growth, product, or manufacture of the NAFTA 
country; or
    (ii) In the case of an article that consists in whole or in part of 
materials from another country or instrumentality, has been 
substantially transformed in a NAFTA country into a new and different 
article of commerce with a name, character, or use distinct from that of 
the article or articles from which it was so transformed. The term 
refers to a product offered for purchase under a supply contract, but 
for purposes of calculating the value of the end product includes 
services (except transportation services) incidental to its supply, 
provided that the value of those incidental services does not exceed the 
value of the product itself.
    (7) ``Nondesignated country end product'' means any end product that 
is not a U.S. made end product or a designated country end product.
    (8) ``North American Free Trade Agreement (NAFTA) country'' means 
Canada or Mexico.
    (9) ``United States'' means the United States, its possessions, 
Puerto Rico, and any other place subject to its jurisdiction, but does 
not include leased bases or trust territories.
    (10) ``U.S. made end product'' means an article that--
    (i) Is wholly the growth, product, or manufacture of the United 
States; or
    (ii) In the case of an article that consists in whole or in part of 
materials from another country or instrumentality, has been 
substantially transformed in the United States into a new and different 
article of commerce with a name, character, or use distinct from that of 
the article or articles from which it was so transformed.
    (b) Unless otherwise specified, the Trade Agreements Act of 1979 (19 
U.S.C. 2501 et seq.), the North American Free Trade Agreement 
Implementation Act of 1993 (19 U.S.C. 3301 note), and the Caribbean 
Basin Initiative apply to all items in the Schedule.
    (c)(1) The Contractor agrees to deliver under this contract only 
domestic end products unless, in its offer, it specified delivery of 
U.S. made, qualifying country, designated country, Caribbean Basin 
country, NAFTA country, or other nondesignated country end products in 
the Buy American Act--Trade Agreements--Balance of Payments Program 
Certificate provision of the solicitation.
    (2) The Contractor may not supply a nondesignated country end 
product unless--
    (i) It is a qualifying country end product, a Caribbean Basin 
country end product, or a NAFTA country end product;
    (ii) The Contracting Officer has determined that offers of U.S. made 
end products or

[[Page 447]]

qualifying, designated, NAFTA, or Caribbean Basin country end products 
from responsive, responsible offerors are either not received or are 
insufficient to fill the Government's requirements; or
    (iii) A national interest waiver has been granted under section 302 
of the Trade Agreements Act of 1979 (see FAR 25.402(c)).
    (d) The offered price of end products listed and certified under 
paragraphs (c)(2)(i) and (vi) of the Buy American Act--Trade 
Agreements--Balance of Payments Program Certificate provision of the 
solicitation must include all applicable duty. The offered price of 
qualifying country end products, designated country end products, NAFTA 
country end products, and Caribbean Basin country end products for line 
items subject to the Trade Agreements Act, or the North American Free 
Trade Agreement Implementation Act, should not include custom fees or 
duty.

                             (End of clause)

    Alternate I (June 1997). As prescribed in 225.408(a)(2), delete 
 Singapore from the list of designated countries in paragraph (a)(4) of 
                            the basic clause.

[62 FR 34130, June 24, 1997, as amended at 62 FR 37148, July 11, 1997]



252.225-7008  Supplies to be accorded duty-free entry.

    As prescribed in 225.605-70(a), use the following clause:

           Supplies To Be Accorded Duty-Free Entry (Dec. 1991)

    In accordance with paragraph (a) of the Duty-Free Entry clause and/
or paragraph (b) of the Duty-Free Entry--Qualifying Country End Products 
and Supplies clause of this contract, the following supplies are 
accorded duty-free entry:
 _______________________________________________________________________
________________________________________________________________________
________________________________________________________________________

                             (End of clause)



252.225-7009  Duty-free entry--qualifying country end products and supplies.

    As prescribed in 225.605-70(b), use the following clause:

Duty-Free Entry--Qualifying Country End Products and Supplies (JAN 1997)

    (a) Definitions.
    Qualifying country and qualifying country end products have the 
meaning given in the Buy American Act and Balance of Payments Program 
clause of this contract.
    (b) The requirements of this clause apply to this contract and 
subcontracts, including purchase orders, that involve supplies to be 
accorded duty-free entry whether--
    (1) Placed directly with a foreign concern as a prime contract; or
    (2) As a subcontract or purchase order under a contract placed with 
a domestic concern.
    (c) Except as otherwise approved by the Contracting Officer, no 
amount is or will be included in the contract price for duty for--
    (1) End items that are qualifying country end products; or
    (2) Supplies (including without limitation, raw materials, 
components, and intermediate assemblies) produced or made in qualifying 
countries, that are to be incorporated in the end items to be delivered 
under this contract, provided that the end items are manufactured in the 
United States or in a qualifying country, except supplies imported into 
the United States before the date of this contract or, in the case of 
supplies imported by a first or lower tier subcontractor, before the 
date of the subcontract.
    (d) The Contractor warrants that--
    (1) All qualifying country supplies, for which duty-free entry is to 
be claimed, are intended to be delivered to the Government or 
incorporated in the end items to be delivered under this contract; and
    (2) The Contractor will pay duty to the extent that such supplies, 
or any portion thereof (if not scrap or salvage) are diverted to 
nongovernmental use, other than as a result of a competitive sale made, 
directed, or authorized by the Contracting Officer.
    (e) The Government agrees to execute duty-free entry certificates 
and to afford such assistance as appropriate to obtain the duty-free 
entry of qualifying country supplies for which the shipping documents 
bear the notation specified in paragraph (f) of this clause, except as 
the Contractor may otherwise agree.
    (f) All shipping documents submitted to Customs, covering foreign 
end products or supplies for which duty-free entry certificates are to 
be issued under this clause, shall--
    (1) Consign the shipments to the appropriate--
    (i) Military department in care of the Contractor, including the 
Contractor's delivery address; or
    (ii) Military installation; and
    (2) Include the following information--
    (i) Prime contract number, and delivery order if applicable;
    (ii) Number of the subcontract/purchase order for foreign supplies 
if applicable;
    (iii) Identification of carrier;
    (iv) The notation: UNITED STATES GOVERNMENT, DEPARTMENT OF DEFENSE 
Duty-Free Entry to be claimed pursuant to section XXII, chapter 98, 
subchapter VIII,

[[Page 448]]

item 9808.00.30 of the Harmonized Tariff Schedule of the United States. 
Upon arrival of shipment at the appropriate port of entry, District 
Director of Customs, please release shipment under 19 CFR part 142 and 
notify Commander, Defense Contract Management Area Operations (DCMAO) 
New York, attn: Customs Team, DCMDN-GNIC, 207 New York Avenue, Staten 
Island, New York, 10305-5013, for execution of Customs Forms 7501, 
7501A, or 7506 and any required duty-free entry certificates. (Note: 
This notation shall be used only for direct shipments to a U.S. military 
installation. In cases where the shipment will be consigned to other 
than a military installation, e.g., a domestic contractor's plant, the 
shipping document notation shall be altered to insert the name and 
address of the contractor, agent or broker who will notify Commander, 
Defense Contract Management Area Operations (DCMAO) New York, for 
execution of the duty-free certificate.)
    (v) Gross weight in pounds (if freight is based on space tonnage, 
state cubic feet in addition to gross shipping weight);
    (vi) Estimated value in U.S. dollars; and
    (vii) Activity Address Number of the contract administration office 
actually administering the prime contract, e.g., for DCMAO Dayton, 
DLA8DP.
    (g) Preparation of customs forms. (1) Except for shipments consigned 
to a military installation, the Contractor shall prepare, or authorize 
an agent to prepare, any customs forms required for the entry of foreign 
supplies in connection with DoD contracts into the United States, its 
possessions, or Puerto Rico. Submit the completed customs forms to the 
District Director of Customs with a copy to DCMAO NY for execution of 
any required duty-free entry certificates. Shipments consigned directly 
to a military installation will be released in accordance with 10.101 
and 10.102 of the U.S. Custom regulations.
    (2) For shipments containing both supplies which are to be accorded 
duty-free entry and supplies which are not, the Contractor shall 
identify on the customs forms those items that are eligible for duty-
free entry.
    (h) The contractor agrees--
    (1) To prepare (if this contract is placed directly with a foreign 
supplier), or to instruct the foreign supplier to prepare, a sufficient 
number of copies of the bill of lading (or other shipping document) so 
that at least two of the copies accompanying the shipment will be 
available for use by the District Director of Customs at the port of 
entry;
    (2) To consign the shipment as specified in paragraph (f) of this 
clause; and
    (3) To mark the exterior of all packages as follows:
    (i) ``UNITED STATES GOVERNMENT, DEPARTMENT OF DEFENSE;'' and
    (ii) The activity address number of the contract administration 
office actually administering the prime contract.
    (i) The Contractor agrees to notify the Contracting Officer 
administering the prime contract in writing of any purchase under the 
contract of qualifying country supplies to be accorded duty-free entry 
that are to be imported into the United States for delivery to the 
Government or for incorporation in end items to be delivered to the 
Government. The notice shall be furnished to the contract administration 
office immediately upon award to the qualifying country supplier. The 
notice shall contain--
    (1) Prime contractor's name, address, and CAGE code;
    (2) Prime contract number, and delivery order number if applicable;
    (3) Total dollar value of the prime contract or delivery order;
    (4) Expiration date of the prime contract or delivery order;
    (5) Foreign supplier's name and address;
    (6) Number of the subcontract/purchase order for foreign supplies;
    (7) Total dollar value of the subcontract for foreign supplies;
    (8) Expiration date of the subcontract for foreign supplies;
    (9) List of items purchased;
    (10) An agreement by the Contractor that duty shall be paid by the 
Contractor to the extent that such supplies, or any portion (if not 
scrap or salvage), are diverted to nongovernmental use other than as a 
result of a competitive sale made, directed, or authorized by the 
Contracting Officer;
    (11) The qualifying country; and
    (12) The scheduled delivery date(s).
    (j) This clause does not apply to purchases of qualifying country 
supplies in connection with this contract if--
    (1) The qualifying country supplies are identical in nature to 
supplies purchased by the Contractor or any subcontractor in connection 
with its commercial business; and
    (2) It is not economical or feasible to account for such supplies so 
as to ensure that the amount of the supplies for which duty-free entry 
is claimed does not exceed the amount purchased in connection with this 
contract.
    (k) The Contractor agrees to insert the substance of this clause, 
including this paragraph (k) in all subcontracts for supplies. Each 
subcontract shall require the subcontractor to identify this contract by 
including its contract number on any shipping documents submitted to 
Customs covering supplies for which duty-free entry is to be claimed 
pursuant to this clause. The Contractor also agrees that the name and 
address of the Contracting Officer administering the prime contract 
(name and address of the contract administration office cognizant

[[Page 449]]

of the prime contract), and its activity address number (appendix G of 
the Defense FAR Supplement), and the information required by paragraphs 
(i) (1), (2), and (3) of this clause will be included in applicable 
subcontracts.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 56 FR 67221, Dec. 30, 1991; 
60 FR 29502, June 5, 1995; 62 FR 2614, Jan. 17, 1997]



252.225-7010  Duty-free entry--additional provisions.

    As prescribed in 225.605-70(d), use the following clause:

            Duty-free Entry--Additional Provisions (JAN 1997)

    (a) The requirements of this clause supplement the Duty-Free Entry 
clause of this contract.
    Both of these clauses apply to this contract and subcontracts, 
including purchase orders, that involve supplies to be accorded duty-
free entry whether placed--
    (1) Directly with a foreign concern as a prime contract; or
    (2) As a subcontractor purchase order under a contract with a 
domestic concern.
    (b) The Contractor shall send the notification required by paragraph 
(b)(1) of the Duty-Free Entry clause of this contract to the Contracting 
Officer administering this contract.
    (c) In addition to any data required by paragraph (b)(1) of the 
Duty-Free Entry clause, the Contractor shall furnish the following for 
all foreign supplies to be imported pursuant to paragraphs (a) or (b) of 
the Duty-Free Entry clause. Furnish this information to the Contracting 
Officer administering the prime contract immediately upon award of any 
contract or subcontract involving supplies to be accorded duty-free 
entry.
    (1) Prime contractor's name, address, and CAGE code;
    (2) Prime contract number plus delivery order number, if applicable;
    (3) Total dollar value of the prime contract or delivery order;
    (4) Expiration date of the prime contract or delivery order;
    (5) Foreign supplier's name and address;
    (6) Number of the subcontract/purchase order for foreign supplies;
    (7) Total dollar value of the subcontract for foreign supplies;
    (8) Expiration date of the subcontract for foreign supplies;
    (9) List of items purchased; and
    (10) An agreement by the Contractor that duty shall be paid by the 
Contractor to the extent that such supplies, or any portion (if not 
scrap or salvage), are diverted to nongovernmental use other than as a 
result of a competitive sale made, directed, or authorized by the 
Contracting Officer.
    (d) The Contractor agrees to incorporate the substance of this 
clause, including this paragraph (d), in any subcontract (including 
purchase orders) in accordance with paragraph (i) of the Duty-Free Entry 
clause of this contract. The Contractor agrees that the name and address 
of the Contracting Officer administering the prime contract (name and 
address of the contract administration office cognizant of the prime 
contract and its activity address number (appendix G of the Defense FAR 
Supplement)) and the information required by paragraphs (c)(1), (2), and 
(3) of this clause will be included in applicable subcontracts.
    (e) To properly complete the shipping document instructions as 
required by paragraph (f) of the Duty-Free Entry clause, the Contractor 
shall insert Defense Contract Management Area Operations (DCMAO) New 
York, attn: Customs Team, DCMDN-GNIC, 207 New York Avenue, Staten 
Island, New York, 10305-5013, as the cognizant contract administration 
office (for paragraph (f) only) in those cases when the shipment is 
consigned directly to a military installation. When the shipment will be 
consigned to a location other than a military installation, e.g., a 
domestic contractor's plant, change the shipping document notation 
required by paragraph (f) of the clause to insert the name and address 
of the Contractor, agent or broker that will prepare the customs 
documentation for execution of the Duty-Free Entry certificates. In 
either case, the shipping documents will contain the following items in 
addition to those required by paragraph (f) of the Duty-Free Entry 
clause:
    (1) Delivery order number on the Government prime contract, if 
applicable;
    (2) Number of the subcontract/purchase order for foreign supplies, 
if applicable;
    (3) Activity address number of the contract administration office 
actually administering the prime contract, e.g., for DCMAO Dayton, 
DLA8DP.
    (f) Except for shipments consigned to a military installation, the 
Contractor shall prepare, or authorize an agent to prepare, any customs 
forms required for the entry into the United States, its possessions, or 
Puerto Rico of foreign supplies in connection with DoD contracts. The 
Contractor shall submit the completed customs forms to the District 
Director of Customs with a copy to DCMAO New York for execution of any 
required duty-free entry certificates. For shipments containing both 
supplies which are to be accorded duty-free entry and supplies which are 
not, the Contractor shall identify on the customs forms those items 
which are

[[Page 450]]

eligible for duty-free entry under the provisions of the Duty-Free Entry 
clause. Shipments consigned directly to a military installation will be 
released in accordance with Secs. 10.101 and 10.102 of the U.S. Customs 
regulations.
    (g) The Contractor shall ensure that all exterior containers are 
marked in accordance with paragraph (g) of the Duty-Free Entry clause, 
including the following additional data--
    (1) ``UNITED STATES GOVERNMENT, DEPARTMENT OF DEFENSE;'' and
    (2) The activity address number for the contract administration 
office actually administering the prime contract.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 59 FR 1291, Jan. 10, 1994; 60 
FR 29502, June 5, 1995; 62 FR 2614, Jan. 17, 1997]



252.225-7011 9  Restriction on acquisition of supercomputers.

    As prescribed in 225.7023-3, use the following clause:

        Restriction on Acquisition of Supercomputers (July 1995)

    The Contractor agrees that any supercomputers furnished under this 
contract have been manufactured in the United States.

                             (End of clause)

[60 FR 34471, July 3, 1995]



252.225-7012  Preference for certain domestic commodities.

    As prescribed in 225.7002-3(a), use the following clause:

         Preference for Certain Domestic Commodities (SEPT 1997)

    (a) The Contractor agrees to deliver under this contract only such 
of the following articles that have been grown, reprocessed, reused, or 
produced in the United States, its possessions, or Puerto Rico--
    (1) Food;
    (2) Clothing;
    (3) Tents, tarpaulins, or covers;
    (4) Cotton and other natural fiber products;
    (5) Woven silk or woven silk blends;
    (6) Spun silk yarn for cartridge cloth;
    (7) Synthetic fabric, and coated synthetic fabric, including all 
textile fibers and yarns that are for use in such fabrics;
    (8) Canvas products;
    (9) Wool (whether in the form of fiber or yarn or contained in 
fabrics, materials, or manufactured articles); or
    (10) Any item of individual equipment (Federal Supply Class 8465) 
manufactured from or containing such fibers, yarns, fabrics, or 
materials.
    (b) This clause does not apply--
    (1) To supplies listed in FAR section 25.108(d)(1), or other 
supplies for which the Government has determined that a satisfactory 
quality and sufficient quantity cannot be acquired as and when needed at 
U.S. market prices;
    (2) To foods which have been manufactured or processed in the United 
States, its possessions, or Puerto Rico;
    (3) To chemical warfare protective clothing produced in the 
countries listed in subsection 225.872-1 of the Defense FAR Supplement; 
or
    (4) To purchase of fibers and yarns that are for use in synthetic 
fabric or coated synthetic fabric (but not the purchase of the synthetic 
or coated synthetic fabric itself), if such fabric is to be used as a 
component of an end item that is not a textile product. Examples of 
textile products, made in whole or in part of fabric, include--
    (i) Draperies, floor coverings, furnishings, and bedding (Federal 
Supply Group 72, Household and Commercial Furnishings and Appliances);
    (ii) Items made in whole or in part of fabric in Federal Supply 
Group 83, Textile/leather/furs/apparel/findings/tents/flags, or Federal 
Supply Group 84, Clothing, Individual Equipment and Insignia;
    (iii) Upholstered seats (whether for household, office, or other 
use); and
    (iv) Parachutes (Federal Supply Class 1670).

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 59 FR 27675, May 27, 1994; 60 
FR 61601, Nov. 30, 1995; 61 FR 50455, Sept. 26, 1996; 62 FR 5780, Feb. 
7, 1997; 62 FR 47154, Sept. 8, 1997]



252.225-7013  [Reserved]



252.225-7014  Preference for domestic specialty metals.

    As prescribed in 225.7002-3(b), use the following clause:

           Preference for Domestic Specialty Metals (FEB 1997)

    (a) Definition.
    Specialty metals means--
    (1) Steel--
    (i) Where the maximum alloy content exceeds one or more of the 
following limits: manganese, 1.65 percent; silicon, 0.60 percent; or 
copper, 0.60 percent; or
    (ii) Which contains more than 0.25 percent of any of the following 
elements: aluminum, chromium, cobalt, columbium, molybdenum, nickel, 
titanium, tungsten, or vanadium;

[[Page 451]]

    (2) Metal alloys consisting of nickel, iron-nickel, and cobalt base 
alloys containing a total of other alloying metals (except iron) in 
excess of ten percent;
    (3) Titanium and titanium alloys; or
    (4) Zirconium and zirconium base alloys.
    (b) The Contractor agrees that any specialty metals incorporated in 
articles delivered under this contract will be melted in the United 
States, its possessions, or Puerto Rico.
    (c) This clause does not apply to the extent that--
    (1) The Secretary or designee determines that a satisfactory quality 
and sufficient quantity of such articles cannot be acquired when needed 
at U.S. market prices;
    (2) The acquisition is for an end product of a country listed in 
subsection 225.872-1 of the Defense Federal Acquisition Regulation 
Supplement;
    (3) The acquisition is necessary to comply with agreements with 
foreign governments requiring the United States to purchase supplies 
from foreign sources to offset sales made by the U.S. Government or U.S. 
firms under approved programs; or
    (4) The specialty metal is purchased by a subcontractor at any tier.

                             (End of clause)

                         Alternate I (Feb 1997)

    As prescribed in 225.7002-3(b), substitute the following paragraph 
(c) for paragraph (c) of the basic clause, and add the following 
paragraph (d) to the basic clause:
    (c) This clause does not apply to the extent that--
    (1) The Secretary or designee determines that a satisfactory quality 
and sufficient quantity of such articles cannot be acquired when needed 
at U.S. market prices;
    (2) The acquisition is for an end product of a country listed in 
subsection 225.872-1 of the Defense Federal Acquisition Regulation 
Supplement; or
    (3) The acquisition is necessary to comply with agreements with 
foreign governments requiring the United States to purchase supplies 
from foreign sources to offset sales made by the U.S. Government or U.S. 
firms under approved programs.
    (d) The Contractor agrees to include the terms of this clause, 
including this paragraph (d), in every subcontract or purchase order 
awarded under this contract unless the item being purchased contains no 
specialty metals.
[56 FR 36479, July 31, 1991, as amended at 60 FR 61602, Nov. 30, 1995; 
61 FR 50455, Sept. 26, 1996; 62 FR 5780, Feb. 7, 1997]



252.225-7015  Preference for domestic hand or measuring tools.

    As prescribed in 225.7002-3(c), use the following clause:

       Preference for Domestic Hand or Measuring Tools (Dec. 1991)

    The Contractor agrees to deliver under this contract only hand or 
measuring tools produced in the United States or its possessions.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 59 FR 27675, May 27, 1994; 61 
FR 50455, Sept. 26, 1996]



252.225-7016  Restriction on acquisition of ball and roller bearings.

    As prescribed in 225.7019-4, use the following clause:

    Restriction on Acquisition of Ball and Roller Bearings (JUN 1997)

    (a) Definitions.
    As used in this clause--
    (1) ``Bearing components'' means the bearing element, retainer, 
inner race, or outer race.
    (2) ``Miniature and instrument ball bearings'' means all rolling 
contact ball bearings with a basic outside diameter (exclusive of flange 
diameters) of 30 millimeters or less, regardless of material, tolerance, 
performance, or quality characteristics.
    (b) The Contractor agrees that, except as provided in paragraph (c) 
of this clause, all ball and roller bearings and ball and roller bearing 
components (including miniature and instrument ball bearings) delivered 
under this contract, either as end items or components of end items, 
shall be wholly manufactured in the United States or Canada. Unless 
otherwise specified, raw materials, such as performed bar, tube, or rod 
stock and lubricants, need not be mined or produced in the United States 
or Canada.
    (c)(1) The restriction in paragraph (b) of this clause does not 
apply to the extent that--
    (i) The end items or components containing ball or roller bearings 
are commercial items; or
    (ii) The ball or roller bearings are commercial items manufactured 
in a qualifying country listed in subsection 225.872-1 of the Defense 
Federal Acquisition Regulation Supplement.
    (2) The commercial item exception in paragraph (c)(1) of this clause 
does not include items designed or developed under a Government contract 
or contracts where the end item is bearings and bearing components.

[[Page 452]]

    (d) The restriction in paragraph (b) of this clause may be waived 
upon request from the Contractor in accordance with subsection 225.7019-
3 of the Defense Federal Acquisition Regulation Supplement. If the 
restriction is waived for miniature and instrument ball bearings, the 
Contractor agrees to acquire a like quantity and type of domestic 
manufacture for nongovernmental use.
    (e) The Contractor agrees to retain records showing compliance with 
this restriction until 3 years after final payment and to make records 
available upon request of the Contracting Office.
    (f) The Contractor agrees to insert this clause, including this 
paragraph (f), in every subcontract and purchase order issued in 
performance of this contract, unless items acquired are--
    (1) Commercial items other than ball or roller bearings; or
    (2) Items that do not contain ball or roller bearings.

                             (End of clause)

[61 FR 50455, Sept. 26, 1996, as amended at 62 FR 34131, June 24, 1997]



252.225-7017  [Reserved]



252.225-7018  Notice of prohibition of certain contracts with foreign entities for the conduct of Ballistic Missile Defense RDT&E.

    As prescribed in 225.7011-5, use the following provision:

Notice of Prohibition of Certain Contracts With Foreign Entities for the 
          Conduct of Ballistic Missile Defense RDT.E (JAN 1997)

    (a) Definitions.
    (1) Competent means the ability of an offeror to satisfy the 
requirements of the solicitation. This determination is based on a 
comprehensive assessment of each offeror's proposal including 
consideration of the specific areas of evaluation criteria in the 
relative order of importance described in the solicitation.
    (2) Foreign firm means a business entity owned or controlled by one 
or more foreign nationals or a business entity in which more than 50 
percent of the stock is owned or controlled by one or more foreign 
nationals.
    (3) U.S. firm means a business entity other than a foreign firm.
    (b) This provision implements section 222 of the Defense 
Authorization Act for FYs 1988 and 1989 (Pub. L. 100-180) prohibiting 
the award of certain contracts, for the conduct of Ballistic Missile 
Defense (BMD) Program research, development, test, or evaluation 
(RDT&E), to foreign governments or firms.
    (c) Except as provided in paragraph (d) of this provision, any funds 
appropriated to, or for the use of, the DoD, may not be used to enter 
into or carry out any contract, including any contract awarded as a 
result of a broad agency announcement (BAA), with a foreign government 
or firm if the contract provides for the conduct of RDT&E in connection 
with the BMD. Foreign governments and firms, however, are encouraged to 
submit offers since this provision is not intended to restrict BMD 
access to unique foreign expertise when contract performance requires a 
level of competency unavailable in the United States.
    (d) The prohibition does not apply to a foreign government or firm 
if--
    (1) The contract will be performed within the United States;
    (2) The contract is exclusively for RDT&E in connection with 
antitactical ballistic missile systems;
    (3) The foreign government or firm agrees to share a substantial 
portion of the total contract cost. The foreign share is considered 
substantial where it is equitable with respect to the relative benefits 
to be derived from the contract by the United States and the foreign 
parties. For example, if the contract is more beneficial to the foreign 
party, its share of the costs should be correspondingly higher; or
    (4) The U.S. Government determines that the contract cannot be 
competently performed by a U.S. firm at a price equal to or less than 
the price at which the RDT&E can be performed by a foreign government or 
firm.
    (e) The offeror (________) is (________) is not a U.S. firm.

                           (End of provision)

[56 FR 36479, July 31, 1991, as amended at 59 FR 27675, May 27, 1994; 62 
FR 2614, Jan. 17, 1997]



252.225-7019  Restriction on acquisition of foreign anchor and mooring chain.

    As prescribed in 225.7012-3, use the following clause:

  Restriction on Acquisition of Foreign Anchor and Mooring Chain (Dec. 
                                  1991)

    (a) Welded shipboard anchor and mooring chain, four inches in 
diameter and under, delivered under this contract--
    (1) Shall be manufactured in the United States, including cutting, 
heat treating, quality control, testing, and welding (both forging and 
shot blasting process); and

[[Page 453]]

    (2) The cost of the components manufactured in the United States 
shall exceed 50 percent of the total cost of components.
    (b) The Contractor may request a waiver of this restriction if 
adequate domestic supplies meeting the above requirements are not 
available to meet the contract delivery schedule.
    (c) The Contractor shall include this clause, including this 
paragraph (c), in all subcontracts, unless the items acquired contain 
none of the restricted welded shipboard anchor and mooring chain.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 61 FR 13108, Mar. 26, 1996]



252.225-7020--252.225-7021  [Reserved]



252.225-7022  Restriction on acquisition of polyacrylonitrile (PAN) carbon fiber.

    As prescribed in 225.7103-3, use the following clause:

Restriction on Acquisition of Polyacrylonitrile (PAN) Carbon Fiber (JUNE 
                                  1997)

    (a) This clause applies only if the end product furnished under this 
contract contains polyacrylonitrile carbon fibers (alternatively 
referred to as PAN-based carbon fibers or PAN-based graphite fibers).
    (b) PAN carbon fibers contained in the end product shall be 
manufactured in the United States or Canada using PAN precursor produced 
in the United States or Canada.
    (c) The Contracting Officer may waive the requirement in paragraph 
(b) of this clause in whole or in part. The Contractor may request a 
waiver from the Contracting Officer by identifying the circumstances and 
including a plan to qualify U.S. or Canadian sources expeditiously.

                             (End of clause)

[62 FR 34131, June 24, 1997]



252.225-7023  [Reserved]



252.225-7024  Restriction on acquisition of night vision image intensifier tubes and devices.

    As prescribed in 225.7015-3, use the following clause:

 Restriction on Acquisition of Night Vision Image Intensifier Tubes and 
                           Devices (Dec. 1991)

    All second and third generation night vision image intensifier tubes 
and devices provided under this contract shall be manufactured in the 
United States or Canada.

                             (End of clause)



252.225-7025  Restriction on acquisition of forgings.

    As prescribed in 225.7102-4, use the following clause:

           Restriction on Acquisition of Forgings (JUNE 1997)

    (a) Definitions. As used in this clause--
    (1) ``Domestic manufacture'' means manufactured in the United States 
or Canada if the Canadian firm--
    (i) Normally produces similar items or is currently producing the 
item in support of DoD contracts (as prime or subcontractor); and
    (ii) Agrees to become (upon receiving a contract/order) a planned 
producer under DoD's Industrial Preparedness Production Planning 
Program, if it is not already a planned producer for the item.
    (2) ``Forging items'' means--

                                                                        
------------------------------------------------------------------------
                   Items                             Categories         
------------------------------------------------------------------------
Ship propulsion shafts....................  Excludes service and landing
                                             craft shafts.              
Periscope tubes...........................  All.                        
Ring forgings for bull gears..............  All greater than 120 inches 
                                             in diameter.               
------------------------------------------------------------------------

    (b) The Contractor agrees that end items and their components 
delivered under this contract shall contain forging items that are of 
domestic manufacture only.
    (c) The restriction in paragraph (b) of this clause may be waived 
upon request from the Contractor in accordance with subsection 225.7102-
3 of the Defense Federal Acquisition Regulation Supplement.
    (d) The Contractor agrees to retain records showing compliance with 
this restriction until 3 years after final payment and to make records 
available upon request of the Contracting Officer.
    (e) The Contractor agrees to insert this clause, including this 
paragraph (e), in subcontracts and purchase orders issued in performance 
of this contract, when products purchased contain restricted forging 
items.

                             (End of clause)

[62 FR 34131, June 24, 1997]



252.225-7026  Reporting of contract performance outside the United States.

    As prescribed in 225.7203, use the following clause:

[[Page 454]]

 Reporting of Contract Performance Outside the United States (NOV 1995)

    (a) Reporting criteria. Reporting under this clause is required 
for--
    (1) Offers exceeding $10 million, if the Offeror is aware at the 
time the offer is submitted that it or its first-tier subcontractor 
intends to perform any part of the contract that exceeds $500,000 
outside the United States and Canada, if that part could be performed 
inside the United States or Canada;
    (2) Contracts exceeding $10 million, when any part that exceeds 
$500,000 could be performed inside the United States or Canada, but will 
be performed outside the United States and Canada. If the information 
was submitted with the offer, it need not be resubmitted unless it 
changes; and
    (3) Contracts exceeding $500,000, when any part that exceeds $25,000 
will be performed outside the United States, unless a foreign place of 
performance is--
    (i) The principal place of performance; and
    (ii) Indicated by the Offeror's entry in the Place of Performance 
provision of the solicitation.
    (b) Submission of reports. (1) The Offeror shall submit reports 
required by paragraph (a)(1) of this clause with its offer.
    (2) The Contractor shall submit reports required by paragraph (a)(2) 
of this clause to the Contracting Officer as soon as the information is 
known, with a copy to the addressee in paragraph (b)(3) of this clause. 
With respect to performance by a first-tier subcontractor, this 
information shall be reported, to the maximum extent practicable, at 
least 30 days before award of the subcontract.
    (3) The Contractor shall submit reports required by paragraph (a)(3) 
of this clause within 10 days of the end of each Government quarter to--
Deputy Director of Defense Procurement (Foreign Contracting) 
OUSD(A&T)DP(FC) Washington, DC 20301-3060
    (4) The Offeror/Contractor shall submit reports on DD Form 2139, 
Report of Contract Performance Outside the United States. Computer-
generated reports are acceptable, provided the report contains all 
information required by DD Form 2139. Copies of DD Form 2139 may be 
obtained from the Contracting Officer.
    (c) Flowdown requirements. (1) The Contractor shall include a clause 
substantially the same as this one in all first-tier subcontracts 
exceeding $100,000, except subcontracts for commercial items, 
construction, ores, natural gases, utilities, petroleum products and 
crudes, timber (logs), or subsistence.
    (2) The Contractor shall provide the prime contract number to 
subcontractors for reporting purposes.
    (d) Information required. Information to be reported on the part of 
this contract performed outside the United States (or outside the United 
States and Canada for reports required by paragraphs (a)(1) and (a)(2) 
of this clause) includes that for--
    (i) Subcontracts;
    (ii) Purchases; and
    (iii) Intracompany transfers when transfers originate in a foreign 
location.

                             (End of clause)

[58 FR 28474, May 13, 1993, as amended at 60 FR 29502, June 5, 1995; 60 
FR 61602, Nov. 30, 1995]



252.225-7027  Restriction on contingent fees for foreign military sales.

    As prescribed in 225.7308(a), use the following clause. Insert in 
paragraph (b) of the clause the name(s) of any foreign country 
customer(s) listed in 225.7303-4(b).

  Restriction on Contingent Fees for Foreign Military Sales (JAN 1997)

    Contingent fees, as defined in the Covenant Against Contingent Fees 
clause of this contract, are not an allowable cost, and the contract 
price (including any subcontracts) shall not include any direct or 
indirect cost of contingent fees for Contractor (or subcontractor) sales 
representatives for solicitation or promotion or otherwise to secure the 
conclusion of the sale of any of the supplies or services called for by 
this contract, unless--
    (a) The amount of contingent fee per foreign military sale does not 
exceed $50,000; and
    (b) For sales to the Government(s) of ____________, the contingent 
fees have been identified and payment approved in writing by the named 
Government(s) before contract award.

                             (End of clause)

[62 FR 2617, Jan. 17, 1997]



252.225-7028  Exclusionary policies and practices of foreign governments.

    As prescribed in 225.7308(b), use the following clause:

 Exclusionary Policies and Practices of Foreign Governments (Dec. 1991)

    No person, partnership, corporation, or other entity performing 
functions pursuant to this contract, shall, in employing or assigning 
personnel to participate in the performance of any such function, 
whether in the United States or abroad, take into account the 
exclusionary policies or practices

[[Page 455]]

of any foreign government where such policies or practices are based on 
race, religion, national origin, or sex.

                             (End of clause)



252.225-7029  Preference for United States or Canadian air circuit breakers.

    As prescribed in 225.7016-4, use the following clause:

  Preference for United States or Canadian Air Circuit Breakers (JUNE 
                                  1997)

    (a) Unless otherwise specified in this offer, the Contractor agrees 
that air circuit breakers for naval vessels provided under this contract 
shall be manufactured in the United States or a qualifying country 
listed in subsection 225.872-1 of the Defense Federal Acquisition 
Regulation Supplement (DFARS).
    (b) Unless an exception applies or a waiver is granted under 
225.7005(b)(1) of the DFARS, preference will be given to air circuit 
breakers manufactured in the United States or Canada by adding 50 
percent for evaluation purposes to the offered price of all other air 
circuit breakers, except air circuit breakers manufactured in a 
qualifying country.

                             (End of clause)

[62 FR 34131, June 24, 1997]



252.225-7030  Restriction on acquisition of carbon, alloy, and armor steel plate.

    As prescribed in 225.7017-4, use the following clause:

Restriction on Acquisition of Carbon, Alloy, and Armor Steel Plate (Oct. 
                                  1992)

    The Contractor agrees that all carbon, alloy, and armor steel plate 
in Federal supply class 9515, or described by American Society for 
Testing Materials (ASTM) or American Iron and Steel Institute (AISI) 
specifications, furnished as a deliverable under this contract, or 
purchased by the contractor as a raw material, for use in a Government-
owned facility or a facility under the control of the Department of 
Defense, shall be melted and rolled in the United States or Canada.

                             (End of clause)

[57 FR 53601, Nov. 12, 1992]



252.225-7031  Secondary Arab boycott of Israel.

    As prescribed in 225.770-5, use the following clause:

              Secondary Arab Boycott of Israel (Jun. 1992)

    (a) Definitions.
    As used in this clause--
    Foreign person means any person other than a United States person as 
defined in section 16(2) of the Export Administration Act of 1979 (50 
U.S.C. App. Sec 2415).
    United States person is defined in section 16(2) of the Export 
Administration Act of 1979 and means any United States resident or 
national (other than an individual resident outside the United States 
and employed by other than a United States person), any domestic concern 
(including any permanent domestic establishment of any foreign concern), 
and any foreign subsidiary or affiliate (including any permanent foreign 
establishment) of any domestic concern which is controlled in fact by 
such domestic concern, as determined under regulations of the President.
    (b) Certification. By submitting this offer, the Offeror, if a 
foreign person, company or entity, certifies that it--
    (1) Does not comply with the Secondary Arab Boycott of Israel; and
    (2) Is not taking or knowingly agreeing to take any action, with 
respect to the Secondary Boycott of Israel by Arab countries, which 50 
U.S.C. App. Sec. 2407(a) prohibits a United States person from taking.

                             (End of clause)

[57 FR 29041, June 30, 1992, as amended at 59 FR 27675, May 27, 1994]



252.225-7032  Waiver of United Kingdom levies.

    As prescribed in 225.873-3, use the following clause:

               Waiver of United Kingdom Levies (Oct. 1992)

    (a) Offered prices for contracts and subcontracts with United 
Kingdom (U.K.) firms may contain commercial exploitation levies assessed 
by the Government of the U.K. The Offeror shall identify to the 
Contracting Officer all levies included in the offered price by 
describing--
    (1) The name of the U.K. firm;
    (2) The item to which the levy applies and quantity; and
    (3) The amount of levy plus any associated indirect costs and profit 
or fee.
    (b) If, after award of the prime contract, the Contractor 
contemplates award of a subcontract over $1 million to a U.K. firm, the 
Contractor shall identify any levy before award of the subcontract and 
shall provide the following information to the Contracting Officer--
    (1) Name of the U.K. firm;
    (2) Prime contract number;

[[Page 456]]

    (3) Description of item to which levy applies:
    (4) Quantity being acquired; and
    (5) Amount of levy plus any associated indirect costs and profit or 
fee.
    (c) The Offeror/Contractor should obtain assistance in identifying 
the levy from the U.K. firm. In the event of difficulty, the Offeror/
Contractor may seek advice through Director of Procurement, United 
Kingdom Defence Procurement Office, British Embassy, 3100 Massachusetts 
Avenue, NW, Washington, DC 20006.
    (d) The U.S. Government may attempt to obtain a waiver of levies 
pursuant to the U.S./U.K. reciprocal waiver agreement of July 1987.
    (1) Where levies are waived before contract award, the offer will be 
evaluated without the levy.
    (2) Where levies are identified but not waived before contract 
award, the offer will be evaluated inclusive of the levies.
    (3) Where a waiver of the levy is obtained after award, the U.S. 
Government reserves the right to reduce the contract price by the amount 
of the levy waived plus associated indirect costs, profit or fee.
    (e) The Contractor agrees to insert the substance of this clause, 
including this paragraph (e), in any subcontract for supplies where a 
lower tier subcontract over $1 million with a U.K. firm is anticipated.

                             (End of clause)

[57 FR 53602, Nov. 12, 1992]



252.225-7033  Restriction on acquisition of four ton dolly jacks.

    As prescribed in 225.7018-3, use the following clause:

     Restriction on Acquisition of Four Ton Dolly Jacks (Apr. 1993)

    Four ton dolly jacks delivered under this contract shall be 
manufactured in the United States unless a waiver is granted in 
accordance with subsection 225.7018-2 of the Defense Federal Acquisition 
Regulation Supplement.

                             (End of clause)

[58 FR 28474, May 13, 1993]



Sec. 252.225-7034  [Reserved]



252.225-7035  Buy American Act--North American Free Trade Agreement Implementation Act--Balance of Payments Program Certificate.

    As prescribed in 225.408(a)(3), use the following provision:

  Buy American Act--North American Free Trade Agreement Implementation 
         Act--Balance of Payments Program Certificate (May 1995)

    (a) Definitions.
    Domestic end product, qualifying country end product, and U.S. made 
end product have the meanings given in the North American Free Trade 
Agreement Implementation Act or Buy American Act and Balance of Payments 
Program clauses of this solicitation.
    (b) Evaluation. Offers will be evaluated by giving preference to 
U.S. made end products, qualifying country end products, or NAFTA 
country end products over other end products.
    (c) Certifications. (1) The Offeror certifies that--
    (i) Each end product, except the end products listed in paragraph 
(c)(2) of this provision, is a domestic end product (as defined in the 
Buy American Act and Balance of Payments Program clause of this 
solicitation); and
    (ii) Components of unknown origin are considered to have been mined, 
produced, or manufactured outside the United States or a qualifying 
country.
    (2) The Offeror must identify and certify all end products that are 
not domestic end products.
    (i) The Offeror certifies that the following supplies qualify as 
``U.S. made end products'' but do not meet the definition of ``domestic 
end product'': (insert line item number).
    (ii) The Offeror certifies that the following supplies are 
qualifying country (except Canada) end products:
    (iii) The Offeror certifies that the following supplies qualify as 
NAFTA country end products: (insert line item number (insert country of 
origin).
    (iv) The Offeror certifies that the following supplies are other 
non-NAFTA country end products: (insert line item number) (insert 
country of origin).

                           (End of provision)

[59 FR 1291, Jan. 10, 1994, as amended at 60 FR 29502, June 5, 1995]



252.225-7036  North American Free Trade Agreement Implementation Act.

    As prescribed in 225.408(a)(4), use the following clause:

   North American Free Trade Agreement Implementation Act (Jan. 1994)

    (a) Definitions.
    (1) Components, domestic end product, end product, nonqualifying 
country, qualifying country, and qualifying country end product

[[Page 457]]

have the meanings given in the Buy American Act and Balance of Payments 
Program clause of this contract.
    (2) North American Free Trade Agreement (NAFTA) country means Canada 
or Mexico.
    (3) NAFTA country end product means an article that--
    (i) Is wholly the growth, product, or manufacture of a NAFTA 
country; or
    (ii) Has, in the case of an article which consists in whole or in 
part of materials from another country or instrumentality, been 
substantially transformed in a NAFTA country into a new and different 
article of commerce with a name, character, or use distinct from that of 
the article or articles from which it was so transformed. The term 
includes services (except transportation services) incidental to its 
supply, provided that the value of those incidental services does not 
exceed the value of the product itself. It does not include service 
contracts as such.
    (4) Non-NAFTA country end product means any end product which is not 
a U.S. made end product or a NAFTA country end product.
    (5) United States means the United States, its designated 
possessions, Puerto Rico, and any other place subject to its 
jurisdiction, but does not include leased bases or trust territories.
    (6) U.S. made end product means an article which is--
    (i) Wholly the growth, product or manufacture of the United States, 
or
    (ii) In the case of an article which consists in whole or in part of 
materials from another country or instrumentality, has been 
substantially transformed in the United States into a new and distinct 
article of commerce with a name, character, or use distinct from that of 
the article or articles from which it was so transformed.
    (b) This clause implements the North American Free Trade Agreement 
Implementation Act of 1993 by providing a preference for U.S. made end 
products and NAFTA country end products over non-NAFTA country end 
products, except non-NAFTA country end products which are qualifying 
country end products.
    (c) The Contractor agrees to deliver under this contract only U.S. 
made end products unless, in its offer, it specified delivery of 
qualifying country, NAFTA country, or non-NAFTA country end products in 
the Buy American Act--North American Free Trade Agreement Implementation 
Act--Balance of Payments Program Certificate provision. An offer 
certifying that a qualifying country end product or a NAFTA country end 
product will be supplied requires the Contractor to supply a qualifying 
country end product or a NAFTA country end product, whichever is 
certified, or, at the Contractor's option, a U.S. made end produce.
    (d) The offered price of end products listed and certified under 
paragraphs (c)(2)(i) and (iv) of the Buy American Act--North American 
Free Trade Agreement Implementation Act-Balance of Payments Program 
Certificate provision of the solicitation must include all applicable 
duty. The offered price of qualifying country end products or NAFTA 
country end products for line items subject to the North American Free 
Trade Agreement Implementation Act, should not include custom fees or 
duty.

                         Alternate I (May 1995)

    As prescribed in 225.408(a)(4)(B)(ii), add the following paragraph 
(a)(7) to the basic clause, and substitute the following paragraph (c) 
in place of paragraph (c) of the basic clause:

    (a)(7) ``Canadian end product,'' means an article that--
    (i) Is wholly the growth, product, or manufacturer of Canada; or
    (ii) Has, in the case of an article which consists in whole or in 
part of materials from another country or instrumentality, been 
substantially transformed in Canada into a new and different article of 
commerce with a name, character, or use distinct from that of the 
article or articles from which it was transformed. The term includes 
services (except transportation services) incidental to its supply; 
provided, that the value of those incidental services does not exceed 
that of the product itself. It does not include service contracts as 
such.
    (c) The Contractor agrees to deliver under this contract only U.S. 
made end products unless, in its offer, it specified delivery of 
qualifying country, NAFTA country, or non-NAFTA country end products in 
the Buy American Act-North American Free Trade Agreement Implementation 
Act-Balance of Payments Program Certificate provision. An offer 
certifying that a qualifying country end product or a Canadian end 
product will be supplied requires the Contractor to supply a qualifying 
country end product or a Canadian end product, whichever is certified, 
or, at the Contractor's option, a U.S. made end product.

                             (End of clause)

[59 FR 1291, Jan. 10, 1994, as amended at 60 FR 29502, June 5, 1995]



252.225-7037  Duty-free entry--NAFTA country end products and supplies.

    As prescribed in 225.605-70(c), use the following clause:

[[Page 458]]

   Duty-Free Entry--NAFTA Country End Products and Supplies (JAN 1997)

    (a) Definitions.
    NAFTA country and NAFTA country end products have the meaning given 
in the North American Free Trade Agreement Implementation Act clause of 
this contract.
    (b) The requirements of this clause apply to this contract and 
subcontracts, including purchase orders, that involve supplies to be 
accorded duty-free entry whether--
    (1) Placed directly with a foreign concern as a prime contract; or
    (2) As a subcontract or purchase order under a contract placed with 
a domestic concern.
    (c) Except as otherwise approved by the Contracting Officer, no 
amount is or will be included in the contract price for duty for NAFTA 
country end products.
    (d) The Contractor warrants that--
    (1) All NAFTA country supplies, for which duty-free entry is to be 
claimed, are intended to be delivered to the Government; and
    (2) The Contractor will pay duty to the extent that such supplies, 
or any portion thereof (if not scrap or salvage) are diverted to 
nongovernmental use, other than as a result of a competitive sale made, 
directed, or authorized by the Contracting Officer.
    (e) The Government agrees to execute duty-free entry certificates 
and to afford such assistance as appropriate to obtain the duty-free 
entry of NAFTA country supplies for which the shipping documents bear 
the notation specified in paragraph (f) of this clause, except as the 
Contractor may otherwise agree.
    (f) All shipping documents submitted to Customs, covering foreign 
end products or supplies for which duty-free entry certificates are to 
be issued under this clause, shall--
    (1) Consign the shipments to the appropriate--
    (i) Military department in care of the Contractor, including the 
Contractor's delivery address; or
    (ii) Military installation; and
    (2) Include the following information--
    (i) Prime contract number, and delivery order if applicable;
    (ii) Number of the subcontract/purchase order for foreign supplies 
if applicable;
    (iii) Identification of carrier;
    (iv) The notation: United States Government, Department of Defense 
Duty-Free Entry to be claimed pursuant to Section XXII, Chapter 98, 
Subchapter VIII, Item 9808.00.30 of the Harmonized Tariff Schedule of 
the United States. Upon arrival of shipment at the appropriate port of 
entry, District Director of Customs, please release shipment under 19 
CFR part 142, and notify Commander, Defense Contract Management Area 
Operations (DCMAO) New York, ATTN: Customs Team, DCMDN-GNIC, 207 New 
York Avenue, Staten Island, New York 10305-5013, for execution of 
Customs Forms 7501, 7501A, or 7506 and any required duty-free entry 
certificates. (Note: This notation shall be used only for direct 
shipments to a U.S. military installation. In cases where the shipment 
will be consigned to other than a military installation, e.g., a 
domestic contractor's plant, the shipping document notation shall be 
altered to insert the name and address of the contractor, agent or 
broker who will notify Commander, DCMAO, NY, for execution of the duty-
free certificate.)
    (v) Gross weight in pounds (if freight is based on space tonnage, 
state cubic feet in addition to gross shipping weight);
    (vi) Estimated value in U.S. dollars; and
    (vii) Activity Address Number of the contract administration office 
actually administering the prime contract, e.g., for DCMAO Dayton, 
DLA8DP.
    (g) Prepartion of customs forms.
    (1) Except for shipments consigned to a military installation, the 
contractor shall prepare, or authorize an agent to prepare, any customs 
forms required for the entry of foreign supplies in connection with DoD 
contracts into the United States, its possessions, or Puerto Rico, 
Submit the completed customs forms to the District Director of Customs 
with a copy to DCMAO NY for execution of any required duty-free entry 
certificates. Shipments consigned directly to a military installation 
will be released in accordance with 10.101 and 10.102 of the U.S. 
Customs regulations.
    (2) For shipments containing both supplies which are to be accorded 
duty-free entry and supplies which are not, the Contractor shall 
identify on the customs forms those items that are eligible for duty-
free entry.
    (h) The Contractor agrees--
    (1) To prepare (if this contract is placed directly with a foreign 
supplier), or to instruct the foreign supplier to prepare, a sufficient 
number of copies of the bill of lading (or other shipping document) so 
that at least two of the copies accompanying the shipment will be 
available for use by the District Director of Customs at the port of 
entry:
    (2) To consign the shipment as specified in paragraph (f) of this 
clause; and
    (3) To mark the exterior of all packages as follows:
    (i) ``United States Government, Department of Defense;'' and
    (ii) The activity address number of the contract administration 
office actually administering the prime contract.
    (i) The Contractor agrees to notify the Contracting Officer 
administering the prime contract in writing of any purchase under the 
contract of NAFTA country supplies to be accorded duty-free entry that 
are to be imported into the United States for delivery to the Government 
or for incorporation in

[[Page 459]]

end items to be delivered to the Government. The notice shall be 
furnished to the contract administration office immediately upon award 
to the qualifying country supplier. The notice shall contain--
    (1) Prime contractor's name, address, and CAGE code;
    (2) Prime contract number, and delivery order number if applicable;
    (3) Total dollar value of the prime contract or delivery order;
    (4) Expiration date of the prime contract or delivery order;
    (5) Foreign supplier's name and address;
    (6) Number of the subcontract/purchase order for NAFTA supplies;
    (7) Total dollar value of the subcontract for NAFTA supplies;
    (8) Expiration date of the subcontract for NAFTA supplies;
    (9) List of items purchased;
    (10) An agreement by the Contractor that duty shall be paid by the 
Contractor to the extent that such supplies, or any portion (if not 
scrap or salvage), are diverted to nongovernmental use other than as a 
result of a competitive sale made, directed, or authorized by the 
Contracting Officer; and
    (11) The scheduled delivery date(s).
    (j) This clause does not apply to purchases of NAFTA country 
supplies in connection with this contract if--
    (1) The NAFTA country supplies are identical in nature to supplies 
purchased by the Contractor or any subcontractor in connection with its 
commercial business; and
    (2) It is not economical or feasible to account for such supplies so 
as to ensure that the amount of the supplies for which duty-free entry 
is claimed does not exceed the amount purchased in connection with this 
contract.
    (k) The Contractor agrees to insert the substance of this clause, 
including this paragraph (k) in all subcontracts for supplies. Each 
subcontract shall require the subcontractor to identify this contract by 
including its contract number on any shipping documents submitted to 
Customs covering supplies for which duty-free entry is to be claimed 
pursuant to this clause. The Contractor also agrees that the name and 
address of the Contracting Officer administering the prime contract 
(name and address of the contract administration office cognizant of the 
prime contract), and its activity address number (Appendix G of the 
Defense FAR Supplement), and the information required by paragraphs (i) 
(1), (2), and (3) of this clause will be included in applicable 
subcontracts.

                             (End of clause)

[59 FR 1292, Jan. 10, 1994; 59 FR 8041, Feb. 17, 1994, as amended at 60 
FR 29503, June 5, 1995; 62 FR 2614, Jan. 17, 1997]



252.225-7038  Restriction on acquisition of aircraft fuel cells.

    As prescribed in 225.7021-3, use the following clause:

      Restriction on Acquisition of Aircraft Fuel Cells (Feb. 1994)

    The Contractor agrees that all aircraft fuel cells furnished under 
this contract have been manufactured in the United States by a domestic-
operated entity.

                             (End of clause)

[59 FR 11729, Mar. 14, 1994; 59 FR 38931, Aug. 1, 1994]



252.225-7039  Restriction on Acquisition of totally enclosed lifeboat survival systems.

    As prescribed in 225.7022-4, use the following clause:

Restriction on Acquisition of Totally Enclosed Lifeboat Survival Systems 
                               (APR 1996)

    For totally enclosed lifeboat survival systems furnished under this 
contract, which consist of lifeboat and associated davits and winches, 
the Contractor agrees that--
    (a) 50 percent or more of the components have been manufactured in 
the United States, and
    (b) 50 percent or more of the labor in the manufacture and assembly 
of the entire system has been performed in the United States.

                             (End of clause)

[59 FR 19146, Apr. 22, 1994, as amended at 61 FR 13108, Mar. 26, 1996]



252.225-7040  [Reserved]



252.225-7041  Correspondence in English.

    As prescribed in 225.971, use the following clause:

                  Correspondence in English (JUNE 1997)

    The Contractor shall ensure that all contract correspondence that is 
addressed to the United States Government is submitted in English or 
with an English translation.

                             (End of clause)

[62 FR 34132, June 24, 1997]

[[Page 460]]



252.225-7042  Authorization to perform.

    As prescribed in 225.97, use the following clause:

                  Authorization to Perform (JUNE 1997)

    The Contractor represents that it has been duly authorized to 
operate and to do business in the country or countries in which this 
contract is to be performed. The Contractor also represents that it will 
fully comply with all laws, decrees, labor standards, and regulations of 
such country or countries, during the performance of this contract.

                             (End of clause)

[62 FR 34132, June 24, 1997]



252.226-7000  Notice of historically black college or university and minority institution set-aside.

    As prescribed in 226.7008(a), use the following clause:

    Notice of Historically Black College or University and Minority 
                    Institution Set-Aside (Apr. 1994)

    (a) Definitions. Historically black colleges and universities, as 
used in this clause, means institutions determined by the Secretary of 
Education to meet the requirements of 34 CFR 608.2. The term also means 
any nonprofit research institution that was an integral part of such a 
college or university before November 14, 1986.
    Minority institutions, as used in this clause, means institutions 
meeting the requirements of section 1046(3) of the Higher Education Act 
of 1965 (20 U.S.C. 1135d-5(3)). The term also includes Hispanic-serving 
institutions as defined in section 316(b)(1) of such Act (20 U.S.C. 
1059c(b)(1)).
    (b) General. (1) Offers are solicited only from historically black 
colleges or universities and minority institutions.
    (2) Any award resulting from this solicitation will be made only to 
an offeror which is a historically black college or university or a 
minority institution at the time of submission of its initial offer 
including price.
    (c) Agreements. The offeror will--
    (1) Perform at least 50 percent of the cost of contract performance 
incurred for personnel with its own employees; and
    (2) Upon request by the Contracting Officer, provide evidence prior 
to award that the Secretary of Education has determined the offeror to 
be a historically black college or university or minority institution.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 59 FR 22131, Apr. 29, 1994]



252.226-7001  Historically Black College or University and Minority Institution Status.

    As prescribed in 226.7008(b), use the following provision:

Historically Black College or University and Minority Institution Status 
                               (JAN 1997)

    (a) Definitions. Historically black colleges and universities, as 
used in this provision, means institutions determined by the Secretary 
of Education to meet the requirements of 34 CFR 608.2. The term also 
means any nonprofit research institution that was an integral part of 
such a college or university before November 14, 1986.
    Minority institutions, as used in this provision, means institutions 
meeting the requirements of section 1046(3) of the Higher Education Act 
of 1965 (20 U.S.C. 1135d-5(3)). The term also includes Hispanic-serving 
institutions as defined in section 316(b)(1) of such Act (20 U.S.C. 
1059c(b)(1)).
    (b) Status.
    If applicable, the offeror shall check the appropriate space below:

________A historically black college or university
________A minority institution

                           (End of provision)

[56 FR 36479, July 31, 1991, as amended at 59 FR 22131, Apr. 29, 1994; 
62 FR 2614, Jan. 17, 1997]



252.227-7000  Non-estoppel.

    As prescribed at 227.7009-1, insert the following clause in patent 
releases, license agreements, and assignments:

                        Non-Estoppel (Oct. 1966)

    The Government reserves the right at any time to contest the 
enforceability, validity, scope of, or the title to any patent or patent 
application herein licensed without waiving or forfeiting any right 
under this contract.

                             (End of clause)



252.227-7001  Release of past infringement.

    As prescribed at 227.7009-2(a), insert the following clause in 
patent releases, license agreements, and assignments:

[[Page 461]]

                Release of Past Infringement (Aug. 1984)

    The Contractor hereby releases each and every claim and demand which 
he now has or may hereafter have against the Government for the 
manufacture or use by or for the Government prior to the effective date 
of this contract, of any inventions covered by (i) any of the patents 
and applications for patent identified in this contract, and (ii) any 
other patent or application for patent owned or hereafter acquired by 
him, insofar as and only to the extent that such other patent or patent 
application covers the manufacture, use, or disposition of (description 
of subject matter).*
---------------------------------------------------------------------------

    *Bracketed portions of the clause may be omitted when not 
appropriate or not encompassed by the release as negotiated.
---------------------------------------------------------------------------

                             (End of clause)



252.227-7002  Readjustment of payments.

    As prescribed at 227.7009-2(b), insert the following clause in 
patent releases, license agreements, and assignments:

                  Readjustment of Payments (Oct. 1966)

    (a) If any license, under substantially the same patents and 
authorizing substantially the same acts which are authorized under this 
contract, has been or shall hereafter be granted within the United 
States, on royalty terms which are more favorable to the licensee than 
those contained herein, the Government shall be entitled to the benefit 
of such more favorable terms with respect to all royalties accruing 
under this contract after the date such more favorable terms become 
effective, and the Contractor shall promptly notify the Secretary in 
writing of the granting of such more favorable terms.
    (b) In the event any claim of any patent hereby licensed is 
construed or held invalid by decision of a court of competent 
jurisdiction, the requirement to pay royalties under this contract 
insofar as its arises solely by reason of such claim, and any other 
claim not materially different therefrom, shall be interpreted in 
conformity with the court's decision as to the scope of validity of such 
claims; Provided, however, that in the event such decision is modified 
or reversed on appeal, the requirement to pay royalties under this 
contract shall be interpreted in conformity with the final decision 
rendered on such appeal.

                             (End of clause)



252.227-7003  Termination.

    As prescribed at 227.7009-2(c), insert the following clause in 
patent releases, license agreements, and assignments:

                         Termination (Aug. 1984)

    Notwithstanding any other provision of this contract, the Government 
shall have the right to terminate the within license, in whole or in 
part, by giving the Contractor not less than thirty (30) days notice in 
writing of the date such termination is to be effective; provided, 
however, that such termination shall not affect the obligation of the 
Government to pay royalties which have accrued prior to the effective 
date of such termination.

                             (End of clause)



252.227-7004  License grant.

    As prescribed at 227.7009-3(a), insert the following clause in 
patent releases, license agreements, and assignments:

                        License Grant (Aug. 1984)

    (a) The Contractor hereby grants to the Government an irrevocable, 
nonexclusive, nontransferable, and paid up license under the following 
patents, applications for patent, and any patents granted on such 
applications, and under any patents which may issue as the result of any 
reissue, division or continuation thereof, to practice by or cause to be 
practiced for the Government throughout the world, any and all of the 
inventions thereunder, in the manufacture and use of any article or 
material, in the use of any method or process, and in the disposition of 
any article or material in accordance with law:
 U.S. Patent No.________________________________________________________
 Date___________________________________________________________________
 Application Serial No._________________________________________________
 Filing Date____________________________________________________________

together with corresponding foreign patents and foreign applications for 
patents, insofar as the Contractor has the right to grant licenses 
thereunder without incurring an obligation to pay royalties or other 
compensation to others solely on account of such grant.
    (b) No rights are granted or implied by the agreement under any 
other patents other than as provided above or by operation of law.
    (c) Nothing contained herein shall limit any rights which the 
Government may have

[[Page 462]]

obtained by virtue of prior contracts or by operation of law or 
otherwise.

                             (End of clause)



252.227-7005  License term.

    As prescribed at 227.7009-3(b), insert one of the following clauses 
in patent releases, license agreements, and assignments:

                        License Term (Aug. 1984)

                         Alternate I (Aug. 1984)

    The license hereby granted shall remain in full force and effect for 
the full term of each of the patents referred to in the ``License 
Grant'' clause of this contract and any and all patents hereafter issued 
on applications for patent referred to in such ``License Grant'' clause.

                        Alternate II (Aug. 1984)

    The license hereby granted shall terminate on the ________ day of 
________ 19________; Provided, however, that said termination shall be 
without prejudice to the completion of any contract entered into by the 
Government prior to said date of termination or to the use or 
disposition thereafter of any articles or materials manufactured by or 
for the Government under this license.



252.227-7006  License grant--running royalty.

    As prescribed at 227.7009-4(a), insert the following clause in 
patent releases, license agreements, and assignments:

               License Grant--Running Royalty (Aug. 1984)

    (a) The Contractor hereby grants to the Government, as represented 
by the Secretary of __________, an irrevocable, nonexclusive, 
nontransferable license under the following patents, applications for 
patent, and any patents granted on such applications, and under any 
patents which may issue as the result of any reissue, division, or 
continuation thereunder to practice by or cause to be practiced for the 
Department of ________, throughout the world, any and all of the 
inventions thereunder in the manufacture and use of any article or 
material, in the use of any method or process, and in the disposition of 
any article or material in accordance with law:
 U.S. Patent No.________________________________________________________
 Date___________________________________________________________________
 Application Serial No._________________________________________________
 Filing Date____________________________________________________________

together with corresponding foreign patents and foreign applications for 
patent, insofar as the Contractor has the right to grant licenses 
thereunder without incurring an obligation to pay royalties or other 
compensation to others solely on account of such grant.
    (b) No rights are granted or implied by the agreement under any 
other patents other than as provided above or by operation of law.
    (c) Nothing contained herein shall limit any rights which the 
Government may have obtained by virtue of prior contracts or by 
operation of law or otherwise.

                             (End of clause)



252.227-7007  License term--running royalty.

    As prescribed at 227.7009-4(b), insert the following clause in 
patent releases, license agreements, and assignments:

                License Term--Running Royalty (Aug. 1984)

    The license hereby granted shall remain in full force and effect for 
the full term of each of the patents referred to in the ``License 
Grant'' clause of this contract and any and all patents hereafter issued 
on applications for patent referred to above unless sooner terminated as 
elsewhere herein provided.

                             (End of clause)



252.227-7008  Computation of royalties.

    As prescribed at 227.7009-4(c), insert the following clause in 
patent releases, license agreements, and assignments:

                  Computation of Royalties (Aug. 1984)

    Subject to the conditions hereinafter stated, royalties shall accrue 
to the Contractor under this agreement on all articles or materials 
embodying, or manufactured by the use of, any or all inventions claimed 
under any unexpired United States patent licensed herein, upon 
acceptance thereof by the Department of ____________, at the rate of 
________ percent of the net selling price of such articles or materials 
(amount) per (name of item) * whether manufactured by the Government or 
procured under a fixed price contract, and at the rate of (amount) per 
(name of item) acquired or manufactured by a Contractor performing under 
a cost-reimbursement contract. With respect to such articles or 
materials made by the Department of ____________, ``net selling price,'' 
as used in this paragraph, means the actual cost of direct labor and 
materials without allowance for overhead and supervision.
---------------------------------------------------------------------------

    * Use bracketed matter as appropriate.

---------------------------------------------------------------------------

[[Page 463]]

                             (End of clause)



252.227-7009  Reporting and payment of royalties.

    As prescribed at 227.7009-4(d), insert the following clause in 
patent releases, license agreements, and assignments:

             Reporting and Payment of Royalties (Aug. 1984)

    (a) The (procuring office) shall, on or before the sixtieth (60th) 
day next following the end of each yearly* period ending ____________ 
during which royalties have accrued under this license, deliver to the 
Contractor, subject to military security regulations, a report in 
writing furnishing necessary information relative to royalties which 
have accrued under this contract.
---------------------------------------------------------------------------

    * The frequency, date, and length of reporting periods should be 
selected as appropriate to the particular circumstances of the contract.

    (b) Royalties which have accrued under this contract during the 
yearly* period ending ____________ shall be paid to the Contractor (if 
appropriations therefor are available or become available) within sixty 
(60) days next following the receipt of a voucher from the Contractor 
submitted in accordance with the report referred to in (a) of this 
clause; Provided, that the Government shall not be obligated to pay, in 
respect of any such yearly period, on account of the combined royalties 
accruing under this contract directly and under any separate licenses 
granted pursuant to the ``License to Other Government Agencies'' clause 
(if any) of this contract, an amount greater than ____________ dollars 
($____________), and if such combined royalties exceed the said maximum 
yearly obligation, each department or agency shall pay a pro rata share 
of the said maximum yearly obligation as determined by the proportion 
its accrued royalties bear to the combined total of accrued royalties.

                             (End of clause)



252.227-7010  License to other Government agencies.

    As prescribed at 227.7009-4(e), insert the following clause in 
patent releases, license agreements, and assignments:

            License to Other Government Agencies (Aug. 1984)

    The Contractor hereby agrees to grant a separate license under the 
patents, applications for patents, and improvements referred to in the 
``License Grant'' clause of this contract, on the same terms and 
conditions as appear in this license contract, to any other department 
or agency of the Government at any time on receipt of a written request 
for such a license from such department or agency; Provided, however, 
that as to royalties which accrue under such separate licenses, reports 
and payments shall be made directly to the Contractor by each such other 
department or agency pursuant to the terms of such separate licenses. 
The Contractor shall notify the Licensee hereunder promptly upon receipt 
of any request for license hereunder.

                             (End of clause)



252.227-7011  Assignments.

    As prescribed at 227.7010, insert the following clause in 
assignments.

                         Assignment (Aug. 1984)

    The Contractor hereby conveys to the Government, as represented by 
the Secretary of ____________, the entire right, title, and interest in 
and to the following patents (and applications for patent), in and to 
the inventions thereof, and in and to all claims and demands whatsoever 
for infringement thereof heretofore accrued, the same to be held and 
enjoyed by the Government through its duly appointed representatives to 
the full end of the term of said patents (and to the full end of the 
terms of all patents which may be granted upon said applications for 
patent, or upon any division, continuation-in-part or continuation 
thereof):

 U.S. Patent No.________________________________________________________
 Date___________________________________________________________________
 Name of Inventor_______________________________________________________
 U.S. Application Serial No.____________________________________________
 Filing Date____________________________________________________________
 Name of Inventor_______________________________________________________

together with corresponding foreign patents and applications for patent 
insofar as the Contractor has the right to assign the same.

                             (End of clause)



252.227-7012  Patent license and release contract.

    As prescribed at 227.7012, insert the following clause in patent 
releases, license agreements, and assignments:

    ____________(Contract No.)

             Patent License and Release Contract (Aug. 1984)

    THIS CONTRACT is effective as of the ____________ day of 
____________ 19____________, between the UNITED STATES OF AMERICA 
(hereinafter called the Government), and ____________ (hereinafter 
called the Contractor), (a corporation organized and existing under the 
laws of the State of ____________), (a partnership consisting of 
____________), (an individual trading as ____________), of the

[[Page 464]]

City of ____________, in the State of ____________.
    Whereas, Contractor warrants that he has the right to grant the 
within license and release, and the Government desires to procure the 
same, and
    Whereas, this contract is authorized by law, including 10 U.S.C. 
2386.
    Now Therefore, in consideration of the grant, release and agreements 
hereinafter recited, the parties have agreed as follows:

Article 1. License Grant.*
---------------------------------------------------------------------------

    * If only a release is procured, delete this article; if an 
assignment is procured, use the clause at 252.227-7011.

    (Insert the clause at 252.227-7004 for a paid up license, or the 
clause at 252.227-7006 for a license on a running royalty basis.)
Article 2. License Term.*
    (Insert the appropriate alternative clause at 252.227-7005 for a 
paid up license, or the clause at 252.227-7007 for a license on a 
running royalty basis.)

Article 3. Release of Past Infringement.
    (Insert the clause at 252.227-7001.)

Article 4. Non-Estoppel.
    (Insert the clause at 252.227-7000.)

Article 5. Payment.
    The Contractor shall be paid the sum of ________ Dollars 
($____________) in full compensation for the rights herein granted and 
agreed to be granted. (For a license on a running royalty basis, insert 
the clause at 252.227-7006 in accordance with the instructions therein, 
and also the clause as specified at 252.227-7002 and 252.227-7009 and 
252.227-7010.)

Article 6. Officials Not to Benefit.
    (Insert the clause at FAR 52.203-1.)

Article 7. Covenant Against Contingent Fees.
    (Insert the clause at FAR 52.203-5.)

Article 8. Assignment of Claims.
    (Insert the clause at FAR 52.232-23.)

Article 9. Gratuities.
    (Insert the clause at FAR 52.203-3.)

Article 10. Disputes.
    (Insert the clause at FAR 52.233-1.)

Article 11. Successors and Assignees.
    This Agreement shall be binding upon the Contractor, his 
successors** and assignees, but nothing contained in this Article shall 
authorize an assignment of any claim against the Government otherwise 
than as permitted by law.
---------------------------------------------------------------------------

    ** When the Contractor is an individual, change ``successors'' to 
``heirs''; if a partnership, modify appropriately.

    In Witness Whereof, the parties hereto have executed this contract.

                      THE UNITED STATES OF AMERICA

 By_____________________________________________________________________
 Date___________________________________________________________________
 (Signature and Title of Contractor)____________________________________
 By_____________________________________________________________________
 Date___________________________________________________________________

                             (End of clause)



252.227-7013  Rights in technical data--Noncommercial items.

    As prescribed in 227.7103-6(a), use the following clause:

        Rights in Technical Data--Noncommercial Items (NOV 1995)

    (a) Definitions. As used in this clause:
    (1) Computer data base means a collection of data recorded in a form 
capable of being processed by a computer. The term does not include 
computer software.
    (2) Computer program means a set of instructions, rules, or routines 
recorded in a form that is capable of causing a computer to perform a 
specific operation or series of operations.
    (3) Computer software means computer programs, source code, source 
code listings, object code listings, design details, algorithms, 
processes, flow charts, formulae and related material that would enable 
the software to be reproduced, recreated, or recompiled. Computer 
software does not include computer data bases or computer software 
documentation.
    (4) Computer software documentation means owner's manuals, user's 
manuals, installation instructions, operating instructions, and other 
similar items, regardless of storage medium, that explain the 
capabilities of the computer software or provide instructions for using 
the software.
    (5) Detailed manufacturing or process data means technical data that 
describe the steps, sequences, and conditions of manufacturing, 
processing or assembly used by the manufacturer to produce an item or 
component or to perform a process.
    (6) Developed means that an item, component, or process exists and 
is workable. Thus, the item or component must have been constructed or 
the process practiced. Workability is generally established when the 
item, component, or process has been analyzed or tested sufficiently to 
demonstrate to reasonable people skilled in the applicable art that 
there is a high probability that it will operate as intended. Whether, 
how much, and what type of analysis or testing is required to establish 
workability depends on the nature of the item, component, or process, 
and the state of the art. To be considered ``developed,'' the item, 
component, or process need not be at the stage where it could be offered 
for sale or sold on the commercial market, nor must the item, component, 
or process be actually reduced to practice within the

[[Page 465]]

meaning of Title 35 of the United States Code.
    (7) Developed exclusively at private expense means development was 
accomplished entirely with costs charged to indirect cost pools, costs 
not allocated to a government contract, or any combination thereof.
    (i) Private expense determinations should be made at the lowest 
practicable level.
    (ii) Under fixed-price contracts, when total costs are greater than 
the firm-fixed-price or ceiling price of the contract, the additional 
development costs necessary to complete development shall not be 
considered when determining whether development was at government, 
private, or mixed expense.
    (8) Developed exclusively with government funds means development 
was not accomplished exclusively or partially at private expense.
    (9) Developed with mixed funding means development was accomplished 
partially with costs charged to indirect cost pools and/or costs not 
allocated to a government contract, and partially with costs charged 
directly to a government contract.
    (10) Form, fit, and function data means technical data that 
describes the required overall physical, functional, and performance 
characteristics (along with the qualification requirements, if 
applicable) of an item, component, or process to the extent necessary to 
permit identification of physically and functionally interchangeable 
items.
    (11) Government purpose means any activity in which the United 
States Government is a party, including cooperative agreements with 
international or multi-national defense organizations, or sales or 
transfers by the United States Government to foreign governments or 
international organizations. Government purposes include competitive 
procurement, but do not include the rights to use, modify, reproduce, 
release, perform, display, or disclose technical data for commercial 
purposes or authorize others to do so.
    (12) Government purpose rights means the rights to--
    (i) Use, modify, reproduce, release, perform, display, or disclose 
technical data within the Government without restriction; and
    (ii) Release or disclose technical data outside the Government and 
authorize persons to whom release or disclosure has been made to use, 
modify, reproduce, release, perform, display, or disclose that data for 
United States government purposes.
    (13) Limited rights means the rights to use, modify, reproduce, 
release, perform, display, or disclose technical data, in whole or in 
part, within the Government. The Government may not, without the written 
permission of the party asserting limited rights, release or disclose 
the technical data outside the Government, use the technical data for 
manufacture, or authorize the technical data to be used by another 
party, except that the Government may reproduce, release or disclose 
such data or authorize the use or reproduction of the data by persons 
outside the Government if reproduction, release, disclosure, or use is--
    (i) Necessary for emergency repair and overhaul; or
    (ii) A release or disclosure of technical data (other than detailed 
manufacturing or process data) to, or use of such data by, a foreign 
government that is in the interest of the Government and is required for 
evaluational or informational purposes;
    (iii) Subject to a prohibition on the further reproduction, release, 
disclosure, or use of the technical data; and
    (iv) The contractor or subcontractor asserting the restriction is 
notified of such reproduction, release, disclosure, or use.
    (14) Technical data means recorded information, regardless of the 
form or method of the recording, of a scientific or technical nature 
(including computer software documentation). The term does not include 
computer software or data incidental to contract administration, such as 
financial and/or management information.
    (15) Unlimited rights means rights to use, modify, reproduce, 
perform, display, release, or disclose technical data in whole or in 
part, in any manner, and for any purpose whatsoever, and to have or 
authorize others to do so.
    (b) Rights in technical data. The Contractor grants or shall obtain 
for the Government the following royalty free, world-wide, nonexclusive, 
irrevocable license rights in technical data other than computer 
software documentation (see the Rights in Noncommercial Computer 
Software and Noncommercial Computer Software Documentation clause of 
this contract for rights in computer software documentation):
    (1) Unlimited rights. The Government shall have unlimited rights in 
technical data that are--
    (i) Data pertaining to an item, component, or process which has been 
or will be developed exclusively with Government funds;
    (ii) Studies, analyses, test data, or similar data produced for this 
contract, when the study, analysis, test, or similar work was specified 
as an element of performance;
    (iii) Created exclusively with Government funds in the performance 
of a contract that does not require the development, manufacture, 
construction, or production of items, components, or processes;
    (iv) Form, fit, and function data;
    (v) Necessary for installation, operation, maintenance, or training 
purposes (other than detailed manufacturing or process data);
    (vi) Corrections or changes to technical data furnished to the 
Contractor by the Government;

[[Page 466]]

    (vii) Otherwise publicly available or have been released or 
disclosed by the Contractor or subcontractor without restrictions on 
further use, release or disclosure, other than a release or disclosure 
resulting from the sale, transfer, or other assignment of interest in 
the technical data to another party or the sale or transfer of some or 
all of a business entity or its assets to another party;
    (viii) Data in which the Government has obtained unlimited rights 
under another Government contract or as a result of negotiations; or
    (ix) Data furnished to the Government, under this or any other 
Government contract or subcontract thereunder, with--
    (A) Government purpose license rights or limited rights and the 
restrictive condition(s) has/have expired; or
    (B) Government purpose rights and the Contractor's exclusive right 
to use such data for commercial purposes has expired.
    (2) Government purpose rights. (i) The Government shall have 
government purpose rights for a five-year period, or such other period 
as may be negotiated, in technical data--
    (A) That pertain to items, components, or processes developed with 
mixed funding except when the Government is entitled to unlimited rights 
in such data as provided in paragraphs (b)(ii) and (b)(iv) through 
(b)(ix) of this clause; or
    (B) Created with mixed funding in the performance of a contract that 
does not require the development, manufacture, construction, or 
production of items, components, or processes.
    (ii) The five-year period, or such other period as may have been 
negotiated, shall commence upon execution of the contract, subcontract, 
letter contract (or similar contractual instrument), contract 
modification, or option exercise that required development of the items, 
components, or processes or creation of the data described in paragraph 
(b)(2)(i)(B) of this clause. Upon expiration of the five-year or other 
negotiated period, the Government shall have unlimited rights in the 
technical data.
    (iii) The Government shall not release or disclose technical data in 
which it has government purpose rights unless--
    (A) Prior to release or disclosure, the intended recipient is 
subject to the non-disclosure agreement at 227.7103-7 of the Defense 
Federal Acquisition Regulation Supplement (DFARS); or
    (B) The recipient is a Government contractor receiving access to the 
data for performance of a Government contract that contains the clause 
at DFARS 252.227-7025, Limitations on the Use or Disclosure of 
Government-Furnished Information Marked with Restrictive Legends.
    (iv) The Contractor has the exclusive right, including the right to 
license others, to use technical data in which the Government has 
obtained government purpose rights under this contract for any 
commercial purpose during the time period specified in the government 
purpose rights legend prescribed in paragraph (f)(2) of this clause.
    (3) Limited rights. (i) Except as provided in paragraphs (b)(1)(ii) 
and (b)(1)(iv) through (b)(1)(ix) of this clause, the Government shall 
have limited rights in technical data--
    (A) Pertaining to items, components, or processes developed 
exclusively at private expense and marked with the limited rights legend 
prescribed in paragraph (f) of this clause; or
    (B) Created exclusively at private expense in the performance of a 
contract that does not require the development, manufacture, 
construction, or production of items, components, or processes.
    (ii) The Government shall require a recipient of limited rights data 
for emergency repair or overhaul to destroy the data and all copies in 
its possession promptly following completion of the emergency repair/
overhaul and to notify the Contractor that the data have been destroyed.
    (iii) The Contractor, its subcontractors, and suppliers are not 
required to provide the Government additional rights to use, modify, 
reproduce, release, perform, display, or disclose technical data 
furnished to the Government with limited rights. However, if the 
Government desires to obtain additional rights in technical data in 
which it has limited rights, the Contractor agrees to promptly enter 
into negotiations with the Contracting Officer to determine whether 
there are acceptable terms for transferring such rights. All technical 
data in which the Contractor has granted the Government additional 
rights shall be listed or described in a license agreement made part of 
the contract. The license shall enumerate the additional rights granted 
the Government in such data.
    (4) Specifically negotiated license rights. The standard license 
rights granted to the Government under paragraphs (b)(1) through (b)(3) 
of this clause, including the period during which the Government shall 
have government purpose rights in technical data, may be modified by 
mutual agreement to provide such rights as the parties consider 
appropriate but shall not provide the Government lesser rights than are 
enumerated in paragraph (a)(13) of this clause. Any rights so negotiated 
shall be identified in a license agreement made part of this contract.
    (5) Prior government rights. Technical data that will be delivered, 
furnished, or otherwise provided to the Government under this contract, 
in which the Government has previously obtained rights shall be 
delivered, furnished, or provided with the pre-existing rights, unless--
    (i) The parties have agreed otherwise; or

[[Page 467]]

    (ii) Any restrictions on the Government's rights to use, modify, 
reproduce, release, perform, display, or disclose the data have expired 
or no longer apply.
    (6) Release from liability. The Contractor agrees to release the 
Government from liability for any release or disclosure of technical 
data made in accordance with paragraph (a)(13) or (b)(2)(iii) of this 
clause, in accordance with the terms of a license negotiated under 
paragraph (b)(4) of this clause, or by others to whom the recipient has 
released or disclosed the data and to seek relief solely from the party 
who has improperly used, modified, reproduced, released, performed, 
displayed, or disclosed Contractor data marked with restrictive legends.
    (c) Contractor rights in technical data. All rights not granted to 
the Government are retained by the Contractor.
    (d) Third party copyrighted data. The Contractor shall not, without 
the written approval of the Contracting Officer, incorporate any 
copyrighted data in the technical data to be delivered under this 
contract unless the Contractor is the copyright owner or has obtained 
for the Government the license rights necessary to perfect a license or 
licenses in the deliverable data of the appropriate scope set forth in 
paragraph (b) of this clause, and has affixed a statement of the license 
or licenses obtained on behalf of the Government and other persons to 
the data transmittal document.
    (e) Identification and delivery of data to be furnished with 
restrictions on use, release, or disclosure. (1) This paragraph does not 
apply to restrictions based solely on copyright.
    (2) Except as provided in paragraph (e)(3) of this clause, technical 
data that the Contractor asserts should be furnished to the Government 
with restrictions on use, release, or disclosure are identified in an 
attachment to this contract (the Attachment). The Contractor shall not 
deliver any data with restrictive markings unless the data are listed on 
the Attachment.
    (3) In addition to the assertions made in the Attachment, other 
assertions may be identified after award when based on new information 
or inadvertent omissions unless the inadvertent omissions would have 
materially affected the source selection decision. Such identification 
and assertion shall be submitted to the Contracting Officer as soon as 
practicable prior to the scheduled date for delivery of the data, in the 
following format, and signed by an official authorized to contractually 
obligate the Contractor: Identification and Assertion of Restrictions on 
the Government's Use, Release, or Disclosure of Technical Data.
    The Contractor asserts for itself, or the persons identified below, 
that the Government's rights to use, release, or disclose the following 
technical data should be restricted--

                                                                                                                
----------------------------------------------------------------------------------------------------------------
  Technical data to be furnished with     Basis for assertion      Asserted rights      Name of person asserting
           restrictions \1\                       \2\                category \3\           restrictions \4\    
----------------------------------------------------------------------------------------------------------------
(LIST)................................  (LIST)................  (LIST)...............  (LIST)                   
----------------------------------------------------------------------------------------------------------------
\1\ If the assertion is applicable to items, components or processes developed at private expense, identify both
  the data and each such item, component, or process.                                                           
\2\ Generally, the development of an item, component, or process at private expense, either exclusively or      
  partially, is the only basis for asserting restrictions on the Government's rights to use, release, or        
  disclose technical data pertaining to such items, components, or processes. Indicate whether development was  
  exclusively or partially at private expense. If development was not at private expense, enter the specific    
  reason for asserting that the Government's rights should be restricted.                                       
\3\ Enter asserted rights category (e.g., government purpose license rights from a prior contract, rights in    
  SBIR data generated under another contract, limited or government purpose rights under this or a prior        
  contract, or specifically negotiated licenses).                                                               
\4\ Corporation, individual, or other person, as appropriate.                                                   
                                                                                                                

 Date___________________________________________________________________

 Printed Name and Title_________________________________________________

 _______________________________________________________________________

Signature_______________________________________________________________

                  (End of identification and assertion)

    (4) When requested by the Contracting Officer, the Contractor shall 
provide sufficient information to enable the Contracting Officer to 
evaluate the Contractor's assertions. The Contracting Officer reserves 
the right to add the Contractor's assertions to the Attachment and 
validate any listed assertion, at a later date, in accordance with the 
procedures of the Validation of Restrictive Markings on Technical Data 
clause of this contract.
    (f) Marking requirements. The Contractor, and its subcontractors or 
suppliers, may only assert restrictions on the Government's rights to 
use, modify, reproduce, release, perform, display, or disclose technical 
data to be delivered under this contract by marking the deliverable data 
subject to restriction. Except as provided in paragraph (f)(5) of this 
clause, only the following legends are authorized under this contract: 
the government purpose rights legend at paragraph (f)(2) of this clause; 
the limited rights legend at paragraph (f)(3) of this clause; or the 
special license rights legend at paragraph (f)(4) of this clause; and/or 
a notice of copyright as prescribed under 17 U.S.C. 401 or 402.
    (1) General marking instructions. The Contractor, or its 
subcontractors or suppliers, shall conspicuously and legibly mark the 
appropriate legend on all technical data that qualify for such markings. 
The authorized legends shall be placed on the transmittal document or 
storage container and, for printed material, each page of the printed 
material containing technical data for which restrictions are asserted. 
When only portions of a page of printed material are subject to the 
asserted restrictions, such portions shall

[[Page 468]]

be identified by circling, underscoring, with a note, or other 
appropriate identifier. Technical data transmitted directly from one 
computer or computer terminal to another shall contain a notice of 
asserted restrictions. Reproductions of technical data or any portions 
thereof subject to asserted restrictions shall also reproduce the 
asserted restrictions.
    (2) Government purpose rights markings. Data delivered or otherwise 
furnished to the Government purpose rights shall be marked as follows:

                        Government Purpose Rights

 Contract No.___________________________________________________________

 Contractor Name________________________________________________________

 Contractor Address_____________________________________________________

 _______________________________________________________________________

Expiration Date_________________________________________________________
    The Government's rights to use, modify, reproduce, release, perform, 
display, or disclose these technical data are restricted by paragraph 
(b)(2) of the Rights in Technical Data--Noncommercial Items clause 
contained in the above identified contract. No restrictions apply after 
the expiration date shown above. Any reproduction of technical data or 
portions thereof marked with this legend must also reproduce the 
markings.

                             (End of legend)

    (3) Limited rights markings. Data delivered or otherwise furnished 
to the Government with limited rights shall be marked with the following 
legend:

                             Limited Rights

 Contract No.___________________________________________________________

 Contractor Name________________________________________________________

 Contractor Address_____________________________________________________

 _______________________________________________________________________
    The Government's rights to use, modify, reproduce, release, perform, 
display, or disclose these technical data are restricted by paragraph 
(b)(3) of the Rights in Technical Data--Noncommercial Items clause 
contained in the above identified contract. Any reproduction of 
technical data or portions thereof marked with this legend must also 
reproduce the markings. Any person, other than the Government, who has 
been provided access to such data must promptly notify the above named 
Contractor.

                             (End of legend)

    (4) Special license rights markings. (i) Data in which the 
Government's rights stem from a specifically negotiated license shall be 
marked with the following legend:

                         Special License Rights

    The Government's rights to use, modify, reproduce, release, perform, 
display, or disclose these data are restricted by Contract No. 
________________ (Insert contract number) ________________, License No. 
________________ (Insert license identifier) ________________. Any 
reproduction of technical data or portions thereof marked with this 
legend must also reproduce the markings.

                             (End of legend)

    (ii) For purposes of this clause, special licenses do not include 
government purpose license rights acquired under a prior contract (see 
paragraph (b)(5) of this clause).
    (5) Pre-existing data markings. If the terms of a prior contract or 
license permitted the Contractor to restrict the Government's rights to 
use, modify, reproduce, release, perform, display, or disclose technical 
data deliverable under this contract, and those restrictions are still 
applicable, the Contractor may mark such data with the appropriate 
restrictive legend for which the data qualified under the prior contract 
or license. The marking procedures in paragraph (f)(1) of this clause 
shall be followed.
    (g) Contractor procedures and records. Throughout performance of 
this contract, the Contractor and its subcontractors or suppliers that 
will deliver technical data with other than unlimited rights, shall--
    (1) Have, maintain, and follow written procedures sufficient to 
assure that restrictive markings are used only when authorized by the 
terms of this clause; and
    (2) Maintain records sufficient to justify the validity of any 
restrictive markings on technical data delivered under this contract.
    (h) Removal of unjustified and nonconforming markings. (1) 
Unjustified technical data markings. The rights and obligations of the 
parties regarding the validation of restrictive markings on technical 
data furnished or to be furnished under this contract are contained in 
the Validation of Restrictive Markings on Technical Data clause of this 
contract. Notwithstanding any provision of this contract concerning 
inspection and acceptance, the Government may ignore or, at the 
Contractor's expense, correct or strike a marking if, in accordance with 
the procedures in the Validation of Restrictive Markings on Technical 
Data clause of this contract, a restrictive marking is determined to be 
unjustified.
    (2) Nonconforming technical data markings. A nonconforming marking 
is a marking placed on technical data delivered or otherwise furnished 
to the Government under this contract that is not in the format 
authorized by this contract. Correction of nonconforming markings is not 
subject to the Validation of Restrictive Markings on Technical Data 
clause of this contract. If the Contracting

[[Page 469]]

Officer notifies the Contractor of a nonconforming marking and the 
Contractor fails to remove or correct such marking within sixty (60) 
days, the Government may ignore or, at the Contractor's expense, remove 
or correct any nonconforming marking.
    (i) Relation to patents. Nothing contained in this clause shall 
imply a license to the Government under any patent or be construed as 
affecting the scope of any license or other right otherwise granted to 
the Government under any patent.
    (j) Limitation on charges for rights in technical data. (1) The 
Contractor shall not charge to this contract any cost, including, but 
not limited to, license fees, royalties, or similar charges, for rights 
in technical data to be delivered under this contract when--
    (i) The Government has acquired, by any means, the same or greater 
rights in the data; or
    (ii) The data are available to the public without restrictions.
    (2) The limitation in paragraph (j)(1) of this clause--
    (i) Includes costs charged by a subcontractor or supplier, at any 
tier, or costs incurred by the Contractor to acquire rights in 
subcontractor or supplier technical data, if the subcontractor or 
supplier has been paid for such rights under any other Government 
contract or under a license conveying the rights to the Government; and
    (ii) Does not include the reasonable costs of reproducing, handling, 
or mailing the documents or other media in which the technical data will 
be delivered.
    (k) Applicability to subcontractors or suppliers. (1) The Contractor 
shall ensure that the rights afforded its subcontractors and suppliers 
under 10 U.S.C. 2320, 10 U.S.C. 2321, and the identification, assertion, 
and delivery processes of paragraph (e) of this clause are recognized 
and protected.
    (2) Whenever any technical data for noncommercial items is to be 
obtained from a subcontractor or supplier for delivery to the Government 
under this contract, the Contractor shall use this same clause in the 
subcontract or other contractual instrument, and require its 
subcontractors or suppliers to do so, without alteration, except to 
identify the parties. No other clause shall be used to enlarge or 
diminish the Government's, the Contractor's, or a higher-tier 
subcontractor's or supplier's rights in a subcontractor's or supplier's 
technical data.
    (3) Technical data required to be delivered by a subcontractor or 
supplier shall normally be delivered to the next higher-tier contractor, 
subcontractor, or supplier. However, when there is a requirement in the 
prime contract for data which may be submitted with other than unlimited 
rights by a subcontractor or supplier, then said subcontractor or 
supplier may fulfill its requirement by submitting such data directly to 
the Government, rather than through a higher-tier contractor, 
subcontractor, or supplier.
    (4) The Contractor and higher-tier subcontractors or suppliers shall 
not use their power to award contracts as economic leverage to obtain 
rights in technical data from their subcontractors or suppliers.
    (5) In no event shall the Contractor use its obligation to recognize 
and protect subcontractor or supplier rights in technical data as an 
excuse for failing to satisfy its contractual obligations to the 
Government.

                             (End of clause)

                         Alternate I (June 1995)

    As prescribed in 227.7103-6(b), add the following paragraph (l) to 
the basic clause:
    (l) Publication for sale. (1) This paragraph only applies to 
technical data in which the Government has obtained unlimited rights or 
a license to make an unrestricted release of technical data.
    (2) The Government shall not publish a deliverable technical data 
item or items identified in this contract as being subject to paragraph 
(l) of this clause or authorize others to publish such data on its 
behalf if, prior to publication for sale by the Government and within 
twenty-four (24) months following the date specified in this contract 
for delivery of such data or the removal of any national security or 
export control restrictions, whichever is later, the Contractor 
publishes that item or items for sale and promptly notifies the 
Contracting Officer of such publication(s). Any such publication shall 
include a notice identifying the number of this contract and the 
Government's rights in the published data.
    (3) This limitation on the Government's right to publish for sale 
shall continue as long as the data are reasonably available to the 
public for purchase.
[60 FR 33490, June 28, 1995, as amended at 60 FR 61602, Nov. 30, 1995]



252.227-7014  Rights in noncommercial computer software and noncommercial computer software documentation.

    As prescribed in 227.7203-6(a)(1), use the following clause.

  Rights in Noncommercial Computer Software and Noncommercial Computer 
                   Software Documentation (June 1995)

    (a) Definitions. As used in this clause:
    (1) Commercial computer software means software developed or 
regularly used for nongovernmental purposes which--
    (i) Has been sold, leased, or licensed to the public;
    (ii) Has been offered for sale, lease, or license to the public;

[[Page 470]]

    (iii) Has not been offered, sold, leased, or licensed to the public 
but will be available for commercial sale, lease, or license in time to 
satisfy the delivery requirements of this contract; or
    (iv) Satisfies a criterion expressed in paragraph (a)(1) (i), (ii), 
or (iii) of this clause and would require only minor modification to 
meet the requirements of this contract.
    (2) Computer database means a collection of recorded data in a form 
capable of being processed by a computer. The term does not include 
computer software.
    (3) Computer program means a set of instructions, rules, or 
routines, recorded in a form that is capable of causing a computer to 
perform a specific operation or series of operations.
    (4) Computer software means computer programs, source code, source 
code listings, object code listings, design details, algorithms, 
processes, flow charts, formulae, and related material that would enable 
the software to be reproduced, recreated, or recompiled. Computer 
software does not include computer databases or computer software 
documentation.
    (5) Computer software documentation means owner's manuals, user's 
manuals, installation instructions, operating instructions, and other 
similar items, regardless of storage medium, that explain the 
capabilities of the computer software or provide instructions for using 
the software.
    (6) Developed means that--
    (i) A computer program has been successfully operated in a computer 
and tested to the extent sufficient to demonstrate to reasonable persons 
skilled in the art that the program can reasonably be expected to 
perform its intended purpose;
    (ii) Computer software, other than computer programs, has been 
tested or analyzed to the extent sufficient to demonstrate to reasonable 
persons skilled in the art that the software can reasonably be expected 
to perform its intended purpose; or
    (iii) Computer software documentation required to be delivered under 
a contract has been written, in any medium, in sufficient detail to 
comply with requirements under that contract.
    (7) Developed exclusively at private expense means development was 
accomplished entirely with costs charged to indirect cost pools, costs 
not allocated to a government contract, or any combination thereof.
    (i) Private expense determinations should be made at the lowest 
practicable level.
    (ii) Under fixed-price contracts, when total costs are greater than 
the firm-fixed-price or ceiling price of the contract, the additional 
development costs necessary to complete development shall not be 
considered when determining whether development was at government, 
private, or mixed expense.
    (8) Developed exclusively with government funds means development 
was not accomplished exclusively or partially at private expense.
    (9) Developed with mixed funding means development was accomplished 
partially with costs charged to indirect cost pools and/or costs not 
allocated to a government contract, and partially with costs charged 
directly to a government contract.
    (10) Government purpose means any activity in which the United 
States Government is a party, including cooperative agreements with 
international or multi-national defense organizations or sales or 
transfers by the United States Government to foreign governments or 
international organizations. Government purposes include competitive 
procurement, but do not include the rights to use, modify, reproduce, 
release, perform, display, or disclose computer software or computer 
software documentation for commercial purposes or authorize others to do 
so.
    (11) Government purpose rights means the rights to--
    (i) Use, modify, reproduce, release, perform, display, or disclose 
computer software or computer software documentation within the 
Government without restriction; and
    (ii) Release or disclose computer software or computer software 
documentation outside the Government and authorize persons to whom 
release or disclosure has been made to use, modify, reproduce, release, 
perform, display, or disclose the software or documentation for United 
States government purposes.
    (12) Minor modification means a modification that does not 
significantly alter the nongovernmental function or purpose of the 
software or is of the type customarily provided in the commercial 
marketplace.
    (13) Noncommercial computer software means software that does not 
qualify as commercial computer software under paragraph (a)(1) of this 
clause.
    (14) Restricted rights apply only to noncommercial computer software 
and mean the Government's rights to--
    (i) Use a computer program with one computer at one time. The 
program may not be accessed by more than one terminal or central 
processing unit or time shared unless otherwise permitted by this 
contract;
    (ii) Transfer a computer program to another Government agency 
without the further permission of the Contractor if the transferor 
destroys all copies of the program and related computer software 
documentation in its possession and notifies the licensor of the 
transfer. Transferred programs remain subject to the provisions of this 
clause;
    (iii) Make the minimum number of copies of the computer software 
required for safekeeping (archive), backup, or modification purposes;
    (iv) Modify computer software provided that the Government may--

[[Page 471]]

    (A) Use the modified software only as provided in paragraphs (a)(14) 
(i) and (iii) of this clause; and
    (B) Not release or disclose the modified software except as provided 
in paragraphs (a)(14) (ii), (v) and (vi) of this clause;
    (v) Permit contractors or subcontractors performing service 
contracts (see 37.101 of the Federal Acquisition Regulation) in support 
of this or a related contract to use computer software to diagnose and 
correct deficiencies in a computer program, to modify computer software 
to enable a computer program to be combined with, adapted to, or merged 
with other computer programs or when necessary to respond to urgent 
tactical situations, provided that--
    (A) The Government notifies the party which has granted restricted 
rights that a release or disclosure to particular contractors or 
subcontractors was made;
    (B) Such contractors or subcontractors are subject to the use and 
non-disclosure agreement at 227.7103-7 of the Defense Federal 
Acquisition Regulation Supplement (DFARS) or are Government contractors 
receiving access to the software for performance of a Government 
contract that contains the clause at DFARS 252.227-7025, Limitations on 
the Use or Disclosure of Government-Furnished Information Marked with 
Restrictive Legends;
    (C) The Government shall not permit the recipient to decompile, 
disassemble, or reverse engineer the software, or use software 
decompiled, disassembled, or reverse engineered by the Government 
pursuant to paragraph (a)(14)(iv) of this clause, for any other purpose; 
and
    (D) Such use is subject to the limitation in paragraph (a)(14)(i) of 
this clause; and
    (vi) Permit contractors or subcontractors performing emergency 
repairs or overhaul of items or components of items procured under this 
or a related contract to use the computer software when necessary to 
perform the repairs or overhaul, or to modify the computer software to 
reflect the repairs or overhaul made, provided that--
    (A) The intended recipient is subject to the use and non-disclosure 
agreement at DFARS 227.7103-7 or is a Government contractor receiving 
access to the software for performance of a Government contract that 
contains the clause at DFARS 252.227-7025, Limitations on the Use or 
Disclosure of Government-Furnished Information Marked with Restrictive 
Legends; and
    (B) The Government shall not permit the recipient to decompile, 
disassemble, or reverse engineer the software, or use software 
decompiled, disassembled, or reverse engineered by the Government 
pursuant to paragraph (a)(14)(iv) of this clause, for any other purpose.
    (15) Unlimited rights means rights to use, modify, reproduce, 
release, perform, display, or disclose computer software or computer 
software documentation in whole or in part, in any manner and for any 
purpose whatsoever, and to have or authorize others to do so.
    (b) Rights in computer software or computer software documentation. 
The Contractor grants or shall obtain for the Government the following 
royalty free, world-wide, nonexclusive, irrevocable license rights in 
noncommercial computer software or computer software documentation. All 
rights not granted to the Government are retained by the Contractor.
    (1) Unlimited rights. The Government shall have unlimited rights 
in--
    (i) Computer software developed exclusively with Government funds;
    (ii) Computer software documentation required to be delivered under 
this contract;
    (iii) Corrections or changes to computer software or computer 
software documentation furnished to the Contractor by the Government;
    (iv) Computer software or computer software documentation that is 
otherwise publicly available or has been released or disclosed by the 
Contractor or subcontractor without restriction on further use, release 
or disclosure, other than a release or disclosure resulting from the 
sale, transfer, or other assignment of interest in the software to 
another party or the sale or transfer of some or all of a business 
entity or its assets to another party;
    (v) Computer software or computer software documentation obtained 
with unlimited rights under another Government contract or as a result 
of negotiations; or
    (vi) Computer software or computer software documentation furnished 
to the Government, under this or any other Government contract or 
subcontract thereunder with--
    (A) Restricted rights in computer software, limited rights in 
technical data, or government purpose license rights and the restrictive 
conditions have expired; or
    (B) Government purpose rights and the Contractor's exclusive right 
to use such software or documentation for commercial purposes has 
expired.
    (2) Government purpose rights. (i) Except as provided in paragraph 
(b)(1) of this clause, the Government shall have government purpose 
rights in computer software development with mixed funding.
    (ii) Government purpose rights shall remain in effect for a period 
of five years unless a different period has been negotiated. Upon 
expiration of the five-year or other negotiated period, the Government 
shall have unlimited rights in the computer software or

[[Page 472]]

computer software documentation. The government purpose rights period 
shall commence upon execution of the contract, subcontract, letter 
contract (or similar contractual instrument), contract modification, or 
option exercise that required development of the computer software.
    (iii) The Government shall not release or disclose computer software 
in which it has government purpose rights to any other person unless--
    (A) Prior to release or disclosure, the intended recipient is 
subject to the use and non-disclosure agreement at DFARS 227.7103-7; or
    (B) The recipient is a Government contractor receiving access to the 
software or documentation for performance of a Government contract that 
contains the clause at DFARS 252.227-7025, Limitations on the Use or 
Disclosure of Government Furnished Information Marked with Restrictive 
Legends.
    (3) Restricted rights. (i) The Government shall have restricted 
rights in noncommercial computer software required to be delivered or 
otherwise provided to the Government under this contract that were 
developed exclusively at private expense.
    (ii) The Contractor, its subcontractors, or suppliers are not 
required to provide the Government additional rights in noncommercial 
computer software delivered or otherwise provided to the Government with 
restricted rights. However, if the Government desires to obtain 
additional rights in such software, the Contractor agrees to promptly 
enter into negotiations with the Contracting Officer to determine 
whether there are acceptable terms for transferring such rights. All 
noncommercial computer software in which the Contractor has granted the 
Government additional rights shall be listed or described in a license 
agreement made part of the contract (see paragraph (b)(4) of this 
clause). The license shall enumerate the additional rights granted the 
Government.
    (4) Specifically negotiated license rights. (i) The standard license 
rights granted to the Government under paragraphs (b)(1) through (b)(3) 
of this clause, including the period during which the Government shall 
have government purpose rights in computer software, may be modified by 
mutual agreement to provide such rights as the parties consider 
appropriate but shall not provide the Government lesser rights in 
computer software than are enumerated in paragraph (a)(14) of this 
clause or lesser rights in computer software documentation than are 
enumerated in paragraph (a)(13) of the Rights in Technical Data--
Noncommercial Items clause of this contract.
    (ii) Any rights so negotiated shall be identified in a license 
agreement made part of this contract.
    (5) Prior government rights. Computer software or computer software 
documentation that will be delivered, furnished, or otherwise provided 
to the Government under this contract, in which the Government has 
previously obtained rights shall be delivered, furnished, or provided 
with the pre-existing rights, unless--
    (i) The parties have agreed otherwise; or
    (ii) Any restrictions on the Government's rights to use, modify, 
reproduce, release, perform, display, or disclose the data have expired 
or no longer apply.
    (6) Release from liability. The Contractor agrees to release the 
Government from liability for any release or disclosure of computer 
software made in accordance with paragraph (a)(14) or (b)(2)(iii) of 
this clause, in accordance with the terms of a license negotiated under 
paragraph (b)(4) of this clause, or by others to whom the recipient has 
released or disclosed the software, and to seek relief solely from the 
party who has improperly used, modified, reproduced, released, 
performed, displayed, or disclosed Contractor software marked with 
restrictive legends.
    (c) Rights in derivative computer software or computer software 
documentation. The Government shall retain its rights in the unchanged 
portions of any computer software or computer software documentation 
delivered under this contract that the Contractor uses to prepare, or 
includes in, derivative computer software or computer software 
documentation.
    (d) Third party copyrighted computer software or computer software 
documentation. The Contractor shall not, without the written approval of 
the Contracting Officer, incorporate any copyrighted computer software 
or computer software documentation in the software or documentation to 
be delivered under this contract unless the Contractor is the copyright 
owner or has obtained for the Government the license rights necessary to 
perfect a license or licenses in the deliverable software or 
documentation of the appropriate scope set forth in paragraph (b) of 
this clause, and prior to delivery of such--
    (1) Computer software, has provided a statement of the license 
rights obtained in a form acceptable to the Contracting Officer; or
    (2) Computer software documentation, has affixed to the transmittal 
document a statement of the license rights obtained.
    (e) Identification and delivery of computer software and computer 
software documentation to be furnished with restrictions on use, 
release, or disclosure. (1) This paragraph does not apply to 
restrictions based solely on copyright.
    (2) Except as provided in paragraph (e)(3) of this clause, computer 
software that the Contractor asserts should be furnished to the

[[Page 473]]

Government with restrictions on use, release, or disclosure is 
identified in an attachment to this contract (the Attachment). The 
Contractor shall not deliver any software with restrictive markings 
unless the software is listed on the Attachment.
    (3) In addition to the assertions made in the Attachment, other 
assertions may be identified after award when based on new information 
or inadvertent omissions unless the inadvertent omissions would have 
materially affected the source selection decision. Such identification 
and assertion shall be submitted to the Contracting Officer as soon as 
practicable prior to the scheduled data for delivery of the software, in 
the following format, and signed by an official authorized to 
contractually obligate the Contractor: Identification and Assertion of 
Restrictions on the Government's Use, Release, or Disclosure of Computer 
Software.
    The Contractor asserts for itself, or the persons identified below, 
that the Government's rights to use, release, or disclose the following 
computer software should be restricted:

                                                                                                                
----------------------------------------------------------------------------------------------------------------
  Computer Software to be Furnished                                Asserted Rights      Name of Person Asserting
         With Restrictions*            Basis for Assertion**         Category***            Restrictions****    
----------------------------------------------------------------------------------------------------------------
(LIST)                                (LIST)                   (LIST)                   (LIST)                  
----------------------------------------------------------------------------------------------------------------
*Generally, development at private expense, either exclusively or partially, is the only basis for asserting    
  restrictions on the Government's rights to use, release, or disclose computer software.                       
**Indicate whether development was exclusively or partially at private expense. If development was not at       
  private expense, enter the specific reason for asserting that the Government's rights should be restricted.   
***Enter asserted rights category (e.g., restricted or government purpose rights in computer software,          
  government purpose license rights from a prior contract, rights in SBIR software generated under another      
  contract, or specifically negotiated licenses).                                                               
****Corporation, individual, or other person, as appropriate.                                                   
                                                                                                                

 Date___________________________________________________________________

 Printed Name and Title_________________________________________________

 _______________________________________________________________________

Signature_______________________________________________________________
(End of identification and assertion)
    (4) When requested by the Contracting Officer, the Contractor shall 
provide sufficient information to enable the Contracting Officer to 
evaluate the Contractor's assertions. The Contracting Officer reserves 
the right to add the Contractor's assertions to the Attachment and 
validate any listed assertion, at a later date, in accordance with the 
procedures of the Validation of Asserted Restrictions--Computer Software 
clause of this contract.
    (f) Marking requirements. The Contractor, and its subcontractors or 
suppliers, may only assert restrictions on the Government's rights to 
use, modify, reproduce, release, perform, display, or disclose computer 
software by marking the deliverable software or documentation subject to 
restriction. Except as provided in paragraph (f)(5) of this clause, only 
the following legends are authorized under this contract; the government 
purpose rights legend at paragraph (f)(2) of this clause; the restricted 
rights legend at paragraph (f)(3) of this clause; or the special license 
rights legend at paragraph (f)(4) of this clause; and/or a notice of 
copyright as prescribed under 17 U.S.C. 401 or 402.
    (1) General marking instructions. The Contractor, or its 
subcontractors or suppliers, shall conspicuously and legibly mark the 
appropriate legend on all computer software that qualify for such 
markings. The authorized legends shall be placed on the transmitted 
document or software storage container and each page, or portions 
thereof, of printed material containing computer software for which 
restrictions are asserted. Computer software transmitted directly from 
one computer or computer terminal to another shall contain a notice of 
asserted restrictions. However, instructions that interfere with or 
delay the operation of computer software in order to display a 
restrictive rights legend or other license statement at any time prior 
to or during use of the computer software, or otherwise cause such 
interference or delay, shall not be inserted in software that will or 
might be used in combat or situations that simulate combat conditions, 
unless the Contracting Officer's written permission to deliver such 
software has been obtained prior to delivery. Reproductions of computer 
software or any portions thereof subject to asserted restrictions, shall 
also reproduce the asserted restrictions.
    (2) Government purpose rights markings. Computer software delivered 
or otherwise furnished to the Government with government purpose rights 
shall be marked as follows:

                        GOVERNMENT PURPOSE RIGHTS

 Contract No.___________________________________________________________

 Contractor Name________________________________________________________

 Contractor Address_____________________________________________________

 _______________________________________________________________________

Expiration Date_________________________________________________________
    The Government's rights to use, modify, reproduce, release, perform, 
display, or disclose this software are restricted by paragraph (b)(2) of 
the Rights in Noncommercial Computer Software and Noncommercial Computer 
Software Documentation clause contained in the above identified 
contract. No restrictions apply after the expiration date shown above. 
Any reproduction of the software or portions thereof marked with this 
legend must also reproduce the markings.
(End of legend)

[[Page 474]]

    (3) Restricted rights markings. Software delivered or otherwise 
furnished to the Government with restricted rights shall be marked with 
the following legend:

                            RESTRICTED RIGHTS

 Contract No.___________________________________________________________

 Contractor Name________________________________________________________

 Contractor Address_____________________________________________________
 _______________________________________________________________________
    The Government's rights to use, modify, reproduce, release, perform, 
display, or disclose this software are restricted by paragraph (b)(3) of 
the Rights in Noncommercial Computer Software and Noncommercial Computer 
Software Documentation clause contained in the above identified 
contract. Any reproduction of computer software or portions thereof 
marked with this legend must also reproduce the markings. Any person, 
other than the Government, who has been provided access to such software 
must promptly notify the above named Contractor.

(End of legend)
    (4) Special license rights markings. (i) Computer software or 
computer documentation in which the Government's rights stem from a 
specifically negotiated license shall be marked with the following 
legend:

                         SPECIAL LICENSE RIGHTS

    The Government's rights to use, modify, reproduce, release, perform, 
display, or disclose this software are restricted by Contract No. 
________(Insert contract number)________, License No.________(Insert 
license identifier)________. Any reproduction of computer software, 
computer software documentation, or portions thereof marked with this 
legend must also reproduce the markings.

                             (End of legend)

    (ii) For purposes of this clause, special licenses do not include 
government purpose license rights acquired under a prior contract (see 
paragraph (b)(5) of this clause).
    (5) Pre-existing markings. If the terms of a prior contract or 
license permitted the Contractor to restrict the Government's rights to 
use, modify, release, perform, display, or disclose computer software or 
computer software documentation and those restrictions are still 
applicable, the Contractor may mark such software or documentation with 
the appropriate restrictive legend for which the software qualified 
under the prior contract or license. The marking procedures in paragraph 
(f)(1) of this clause shall be followed.
    (g) Contractor procedures and records. Throughout performance of 
this contract, the Contractor and its subcontractors or suppliers that 
will deliver computer software or computer software documentation with 
other than unlimited rights, shall--
    (1) Have, maintain, and follow written procedures sufficient to 
assure that restrictive markings are used only when authorized by the 
terms of this clause; and
    (2) Maintain records sufficient to justify the validity of any 
restrictive markings on computer software or computer software 
documentation delivered under this contract.
    (h) Removal of unjustified and nonconforming markings. (1) 
Unjustified computer software or computer software documentation 
markings. The rights and obligations of the parties regarding the 
validation of restrictive markings on computer software or computer 
software documentation furnished or to be furnished under this contract 
are contained in the Validation of Asserted Restrictions--Computer 
Software and the Validation of Restrictive Markings on Technical Data 
clauses of this contract, respectively. Notwithstanding any provision of 
this contract concerning inspection and acceptance, the Government may 
ignore or, at the Contractor's expense, correct or strike a marking if, 
in accordance with the procedures of those clauses, a restrictive 
marking is determined to be unjustified.
    (2) Nonconforming computer software or computer software 
documentation markings. A nonconforming marking is a marking placed on 
computer software or computer software documentation delivered or 
otherwise furnished to the Government under this contract that is not in 
the format authorized by this contract. Correction of nonconforming 
markings is not subject to the Validation of Asserted Restrictions--
Computer Software or the Validation of Restrictive Markings on Technical 
Data clause of this contract. If the Contracting Officer notifies the 
Contractor of a nonconforming marking or markings and the Contractor 
fails to remove or correct such markings within sixty (60) days, the 
Government may ignore or, at the Contractor's expense, remove or correct 
any nonconforming markings.
    (i) Relation to patents. Nothing contained in this clause shall 
imply a license to the Government under any patent or be construed as 
affecting the scope of any license or other right otherwise granted to 
the Government under any patent.
    (j) Limitation on charges for rights in computer software or 
computer software documentation. (1) The Contractor shall not charge to 
this contract any cost, including but not limited to license fees, 
royalties, or similar charges, for rights in computer software or 
computer software documentation to be delivered under this contract 
when--
    (i) The Government has acquired, by any means, the same or greater 
rights in the software or documentation; or

[[Page 475]]

    (ii) The software or documentation are available to the public 
without restrictions.
    (2) The limitation in paragraph (j)(1) of this clause--
    (i) Includes costs charged by a subcontractor or supplier, at any 
tier, or costs incurred by the Contractor to acquire rights in 
subcontractor or supplier computer software or computer software 
documentation, if the subcontractor or supplier has been paid for such 
rights under any other Government contract or under a license conveying 
the rights to the Government; and
    (ii) Does not include the reasonable costs of reproducing, handling, 
or mailing the documents or other media in which the software or 
documentation will be delivered.
    (k) Applicability to subcontractors or suppliers. (1) Whenever any 
noncommercial computer software or computer software documentation is to 
be obtained from a subcontractor or supplier for delivery to the 
Government under this contract, the Contractor shall use this same 
clause in its subcontracts or other contractual instruments, and require 
its subcontractors or suppliers to do so, without alteration, except to 
identify the parties. No other clause shall be used to enlarge or 
diminish the Government's, the Contractor's, or a higher tier 
subcontractor's or supplier's rights in a subcontractor's or supplier's 
computer software or computer software documentation.
    (2) The Contractor and higher tier subcontractors or suppliers shall 
not use their power to award contracts as economic leverage to obtain 
rights in computer software or computer software documentation from 
their subcontractors or suppliers.
    (3) The Contractor shall ensure that subcontractor or supplier 
rights are recognized and protected in the identification, assertion, 
and delivery processes required by paragraph (e) of this clause.
    (4) In no event shall the Contractor use its obligation to recognize 
and protect subcontractor or supplier rights in computer software or 
computer software documentation as an excuse for failing to satisfy its 
contractual obligation to the Government.

                             (End of clause)

                         Alternate I (Jun. 1995)

    As prescribed in 227.7203-6(a)(2), add the following paragraph (l) 
to the basic clause:

    (l) Publication for sale. (1) This paragraph only applies to 
computer software or computer software documentation in which the 
Government has obtained unlimited rights or a license to make an 
unrestricted release of the software or documentation.
    (2) The Government shall not publish a deliverable item or items of 
computer software or computer software documentation identified in this 
contract as being subject to paragraph (l) of this clause or authorize 
others to publish such software or documentation on its behalf if, prior 
to publication for sale by the Government and within twenty-four (24) 
months following the date specified in this contract for delivery of 
such software or documentation, or the removal of any national security 
or export control restrictions, whichever is later, the Contractor 
publishes that item or items for sale and promptly notifies the 
Contracting Officer of such publication(s). Any such publication shall 
include a notice identifying the number of this contract and the 
Government's rights in the published software or documentation.
    (3) This limitation on the Government's rights to publish for sale 
shall continue as long as the software or documentation are reasonably 
available to the public for purchase.
[60 FR 33493, June 28, 1995]



252.227-7015  Technical data--Commercial items.

    As prescribed in 227.7102-3, use the following clause:

               Technical Data--Commercial Items (NOV 1995)

    (a) Definitions. As used in this clause:
    (1) Commercial item does not include commercial computer software.
    (2) Form, fit, and function data means technical data that describes 
the required overall physical, functional, and performance 
characteristics (along with the qualification requirements, if 
applicable) of an item, component, or process to the extent necessary to 
permit identification of physically and functionally interchangeable 
items.
    (3) The term item includes components or processes.
    (4) Technical data means recorded information, regardless of the 
form or method of recording, of a scientific or technical nature 
(including computer software documentation). The term does not include 
computer software or data incidental to contract administration, such as 
financial and/or management information.
    (b) License. (1) The Government shall have the unrestricted right to 
use, modify, reproduce, release, perform, display, or disclose technical 
data, and to permit others to do so, that--
    (i) Have been provided to the Government or others without 
restrictions on use, modification, reproduction, release, or further 
disclosure other than a release or disclosure resulting from the sale, 
transfer, or other assignment of interest in the technical data to 
another party or the sale or transfer of some or all of a business 
entity or its assets to another party;

[[Page 476]]

    (ii) Are form, fit, and function data;
    (iii) Are a correction or change to technical data furnished to the 
Contractor by the Government;
    (iv) Are necessary for operation, maintenance, installation, or 
training (other than detailed manufacturing or process data); or
    (v) Have been provided to the Government under a prior contract or 
licensing agreement through which the Government has acquired the rights 
to use, modify, reproduce, release, perform, display, or disclose the 
data without restrictions.
    (2) Except as provided in paragraph (b)(1) of this clause, the 
Government may use, modify, reproduce, release, perform, display, or 
disclose technical data within the Government only. The Government shall 
not--
    (i) Use the technical data to manufacture additional quantities of 
the commercial items; or
    (ii) Release, perform, display, disclose, or authorize use of the 
technical data outside the Government without the Contractor's written 
permission unless a release, disclosure or permitted use is necessary 
for emergency repair or overhaul of the commercial items furnished under 
this contract.
    (c) Additional license rights. The Contractor, its subcontractors, 
and suppliers are not required to provide the Government additional 
rights to use, modify, reproduce, release, perform, display, or disclose 
technical data. However, if the Government desires to obtain additional 
rights in technical data, the Contractor agrees to promptly enter into 
negotiations with the Contracting Officer to determine whether there are 
acceptable terms for transferring such rights. All technical data in 
which the Contractor has granted the Government additional rights shall 
be listed or described in a special license agreement made part of this 
contract. The license shall enumerate the additional rights granted the 
Government in such data.
    (d) Release from liability. The Contractor agrees that the 
Government, and other persons to whom the Government may have released 
or disclosed technical data delivered or otherwise furnished under this 
contract, shall have no liability for any release or disclosure of 
technical data that are not marked to indicate that such data are 
licensed data subject to use, modification, reproduction, release, 
performance, display, or disclosure restrictions.

(End of clause)
[60 FR 33497, June 28, 1995, as amended at 60 FR 61602, Nov. 30, 1995]



252.227-7016  Rights in bid or proposal information.

    As prescribed in 227.7103-6(e)(1), 227.7104(e)(1), or 227.7203-6(b), 
use the following clause:

            Rights in Bid or Proposal Information (Jun. 1995)

    (a) Definitions. (1) For contracts that require the delivery of 
technical data, the terms ``technical data'' and ``computer software'' 
are defined in the Rights in Technical Data--Noncommercial Item clause 
of this contract or, if this is a contract awarded under the Small 
Business Innovative Research Program, the Rights in Noncommercial 
Technical Data and Computer Software--Small Business Innovative Research 
(SBIR) Program clause of this contract.
    (2) For contracts that do not require the delivery of technical 
data, the term ``computer software'' is defined in the Rights in 
Noncommercial Computer and Noncommercial Computer Software Documentation 
clause of this contract or, if this is a contract awarded under the 
Small Business Innovative Research Program, the Rights in Noncommercial 
Technical Data and Computer Software--Small Business Innovative Research 
(SBIR) Program clause of this contract.
    (b) Government rights to contract award. By submission of its offer, 
the Offeror agrees that the Government--
    (1) May reproduce the bid or proposal, or any portions thereof, to 
the extent necessary to evaluate the offer.
    (2) Except as provided in paragraph (d) of this clause, shall use 
information contained in the bid or proposal only for evaluational 
purposes and shall not disclose, directly or indirectly, such 
information to any person including potential evaluators, unless that 
person has been authorized by the head of the agency, his or her 
designee, or the Contracting Officer to receive such information.
    (c) Government rights subsequent to contract award. The Contractor 
agrees--
    (1) Except as provided in paragraphs (c)((2), (d), and (e) of this 
clause, the Government shall have the rights to use, modify, reproduce, 
release, perform, display, or disclose information contained in the 
Contractor's bid or proposal within the Government. The Government shall 
not release, perform, display, or disclose such information outside the 
Government without the Contractor's written permission.
    (2) The Government's right to use, modify, reproduce, release, 
perform, display, or disclose information that is technical data or 
computer software required to be delivered under this contract are 
determined by the Rights in Technical Data--Noncommercial Items, Rights 
in Noncommercial Computer Software and Noncommercial Computer Software 
Documentation, or Rights in Noncommercial Technical Data and Computer 
Software--Small Business Innovative Research (SBIR) Program clause(s) of 
this contract.

[[Page 477]]

    (d) Government-furnished information. The Government's rights with 
respect to technical data or computer software contained in the 
Contractor's bid or proposal that were provided to the Contractor by the 
Government are subject only to restrictions on use, modification, 
reproduction, release, performance, display, or disclosure, if any, 
imposed by the developer or licensor of such data or software.
    (e) Information available without restrictions. The Government's 
rights to use, modify, reproduce, release, perform, display, or, 
disclose information contained in a bid or proposal, including technical 
data or computer software, and to permit others to do so, shall not be 
restricted in any manner if such information has been released or 
disclosed to the Government or to other persons without restrictions 
other than a release or disclosure resulting from the sale, transfer, or 
other assignment of interest in the information to another party or the 
sale or transfer of some or all of a business entity or its assets to 
another party.
    (f) Flowdown. Contractor shall include this clause in all 
subcontracts or similar contractual instruments and require its 
subcontractors or suppliers to do so without alteration, except to 
identify the parties.

                             (End of clause)

[60 FR 33498, June 28, 1995]



252.227-7017  Identification and assertion of use, release, or disclosure restrictions.

    As prescribed in 227.7103-3(b), 227.7104(e)(2), or 227.7203-3(a), 
use the following provision:

Identification and Assertion of Use, Release, or Disclosure Restrictions 
                               (Jun. 1995)

    (a) The terms used in this provision are defined in following clause 
or clauses contained in this solicitation--
    (1) If a successful offeror will be required to deliver technical 
data, the Rights in Technical Data--Noncommercial Items clause, or, if 
this solicitation contemplates a contract under the Small Business 
Innovative Research Program, the Rights in Noncommercial Technical Data 
and Computer Software--Small Business Innovative Research (SBIR) Program 
clause.
    (2) If a successful offeror will not be required to deliver 
technical data, the Rights in Noncommercial Computer Software and 
Noncommercial Computer Software Documentation clause, or, if this 
solicitation contemplates a contract under the Small Business Innovative 
Research Program, the Rights in Noncommercial Technical Data and 
Computer Software--Small Business Innovative Research (SBIR) Program 
clause.
    (b) The identification and assertion requirements in this provision 
apply only to technical data, including computer software documents, or 
computer software to be delivered with other than unlimited rights. For 
contracts to be awarded under the Small Business Innovative Research 
Program, the notification requirements do not apply to technical data or 
computer software that will be generated under the resulting contract. 
Notification and identification is not required for restrictions based 
solely on copyright.
    (c) Offers submitted in response to this solicitation shall 
identify, to the extent known at the time an offer is submitted to the 
Government, the technical data or computer software that the Offeror, 
its subcontractors or suppliers, or potential subcontractors or 
suppliers, assert should be furnished to the Government with 
restrictions on use, release, or disclosure.
    (d) The Offeror's assertions, including the assertions of its 
subcontractors or suppliers or potential subcontractors or suppliers 
shall be submitted as an attachment to its offer in the following 
format, dated and signed by an official authorized to contractually 
obligate the Offeror:

 Identification and Assertion of Restrictions on the Government's Use, 
      Release, or Disclosure of Technical Data or Computer Software

    The Offeror asserts for itself, or the persons identified below, 
that the Government's rights to use, release, or disclose the following 
technical data or computer software should be restricted:

                                                                                                                                                        
--------------------------------------------------------------------------------------------------------------------------------------------------------
   Technical Data or Computer Software to be Furnished With                                                                   Name of Person Asserting  
                         Restrictions*                              Basis for Assertion**      Asserted Rights Category***        Restrictions****      
--------------------------------------------------------------------------------------------------------------------------------------------------------
                          (LIST)*****                                      (LIST)                        (LIST)                        (LIST)           
--------------------------------------------------------------------------------------------------------------------------------------------------------
*For technical data (other than computer software documentation) pertaining to items, components, or processes developed at private expense, identify   
  both the deliverable technical data and each such items, component, or process. For computer software or computer software documentation identify the 
  software or documentation.                                                                                                                            
**Generally, development at private expense, either exclusively or partially, is the only basis for asserting restrictions. For technical data, other   
  than computer software documentation, development refers to development of the item, component, or process to which the data pertain. The Government's
  rights in computer software documentation generally may not be restricted. For computer software, development refers to the software. Indicate whether
  development was accomplished exclusively or partially at private expense. If development was not accomplished at private expense, or for computer     
  software documentation, enter the specific basis for asserting restrictions.                                                                          

[[Page 478]]

                                                                                                                                                        
***Enter asserted rights category (e.g., government purpose license rights from a prior contract, rights in SBIR data generated under another contract, 
  limited, restricted, or government purpose rights under this or a prior contract, or specially negotiated licenses).                                  
****Corporation, individual, or other person, as appropriate.                                                                                           
*****Enter ``none'' when all data or software will be submitted without restrictions.                                                                   

 Date___________________________________________________________________

 Printed Name and Title_________________________________________________

 _______________________________________________________________________

Signature_______________________________________________________________

(End of identification and assertion)
    (e) An offeror's failure to submit, complete, or sign the 
notification and identification required by paragraph (d) of this 
provision with its offer may render the offer ineligible for award.
    (f) If the Offeror is awarded a contract, the assertions identified 
in paragraph (d) of this provision shall be listed in an attachment to 
that contract. Upon request by the Contracting Officer, the Offeror 
shall provide sufficient information to enable the Contracting Officer 
to evaluate any listed assertion.

                           (End of provision)

[60 FR 33498, June 28, 1994]



252.227-7018  Rights in noncommercial technical data and computer software--Small Business Innovation Research (SBIR) Program.

    As prescribed in 227.7104(a), use the following clause:

  Rights in Noncommercial Technical Data and Computer Software--Small 
         Business Innovation Research (SBIR) Program (Jun. 1995)

    (a) Definitions. As used in this clause:
    (1) Commercial computer software means software developed or 
regularly used for nongovernmental purposes which--
    (i) Has been sold, leased, or licensed to the public;
    (ii) Has been offered for sale, lease, or license to the public;
    (iii) Has not been offered, sold, leased, or licensed to the public 
but will be available for commercial sale, lease, or license in time to 
satisfy the delivery requirements of this contract; or
    (iv) Satisfies a criterion expressed in paragraph (a)(1)(i), (ii), 
or (iii) of this clause and would require only minor modification to 
meet the requirements of this contract.
    (2) Computer database means a collection of recorded data in a form 
capable of being processed by a computer. The term does not include 
computer software.
    (3) Computer program means a set of instructions, rules, or 
routines, recorded in a form that is capable of causing a computer to 
perform a specific operation or series of operations.
    (4) Computer software means computer programs, source code, source 
code listings, object code listings, design details, algorithms, 
processes, flow charts, formulae, and related material that would enable 
the software to be reproduced, re-created, or recompiled. Computer 
software does not include computer databases or computer software 
documentation.
    (5) Computer software documentation means owner's manuals, user's 
manuals, installation instructions, operating instructions, and other 
similar items, regardless of storage medium, that explain the 
capabilities of the computer software or provide instructions for using 
the software.
    (6) Detailed manufacturing or process data means technical data that 
describe the steps, sequences, and conditions of manufacturing, 
processing or assembly used by the manufacturer to produce an item or 
component or to perform a process.
    (7) Developed means--
    (i) (Applicable to technical data other than computer software 
documentation.) An item, component, or process, exists and is workable. 
Thus, the item or component must have been constructed or the process 
practiced. Workability is generally established when the item, 
component, or process has been analyzed or tested sufficiently to 
demonstrate to reasonable people skilled in the applicable art that 
there is a high probability that it will operate as intended. Whether, 
how much, and what type of analysis or testing is required to establish 
workability depends on the nature of the item, component, or process, 
and the state of the art. To be considered ``developed,'' the item, 
component, or process need not be at the stage where it could be offered 
for sale or sold on the commercial market, nor must the item, component 
or process be actually reduced to practice within the meaning of Title 
35 of the United States Code;
    (ii) A computer program has been successfully operated in a computer 
and tested to the extent sufficient to demonstrate to reasonable persons 
skilled in the art that the program can reasonably be expected to 
perform its intended purpose;
    (iii) Computer software, other than computer programs, has been 
tested or analyzed to the extent sufficient to demonstrate to reasonable 
persons skilled in the art that the software can reasonably be expected 
to perform its intended purpose; or
    (iv) Computer software documentation required to be delivered under 
a contract has been written, in any medium, in sufficient

[[Page 479]]

detail to comply with requirements under that contract.
    (8) Developed exclusively at private expense means development was 
accomplished entirely with costs charged to indirect cost pools, costs 
not allocated to a government contract, or any combination thereof.
    (i) Private expense determinations should be made at the lowest 
practicable level.
    (ii) Under fixed-price contracts, when total costs are greater than 
the firm-fixed-price or ceiling price of the contract, the additional 
development costs necessary to complete development shall not be 
considered when determining whether development was at government, 
private, or mixed expense.
    (9) Developed exclusively with government funds means development 
was not accomplished exclusively or partially at private expense.
    (10) Developed with mixed funding means development was accomplished 
partially with costs charged to indirect cost pools and/or costs not 
allocated to a government contract, and partially with costs charged 
directly to a government contract.
    (11) Form, fit, and function data means technical data that describe 
the required overall physical, functional, and performance 
characteristics (along with the qualification requirements, if 
applicable) of an item, component, or process to the extent necessary to 
permit identification of physically and functionally interchangeable 
items.
    (12) Generated means technical data or computer software first 
created in the performance of this contract.
    (13) Government purpose means any activity in which the United 
States Government is a party, including cooperative agreements with 
international or multi-national defense organizations or sales or 
transfers by the United States Government to foreign governments or 
international organizations. Government purposes include competitive 
procurement, but do not include the rights to use, modify, reproduce, 
release, perform, display, or disclose technical data or computer 
software for commercial purposes or authorize others to do so.
    (14) Limited rights means the rights to use, modify, reproduce, 
release, perform, display, or disclose technical data, in whole or in 
part, within the Government. The Government may not, without the written 
permission of the party asserting limited rights, release or disclose 
the technical data outside the Government, use the technical data for 
manufacture, or permit the technical data to be used by another party, 
except that the Government may reproduce, release or disclose such data 
or permit the use or reproduction of the data by persons outside the 
Government if reproduction, release, disclosure, or use is--
    (i) Necessary for emergency repair and overhaul; or
    (ii) A release or disclosure of technical data (other than detailed 
manufacturing or process data) to, or use of such data by, a foreign 
government that is in the interest of the Government and is required for 
evaluational or informational purposes;
    (iii) Subject to a prohibition on the further reproduction, release 
disclosure, or use of the technical data; and
    (iv) The Contractor or subcontractor asserting the restriction is 
notified of such reproduction, release, disclosure, or use.
    (15) Minor modification means a modification that does not 
significantly alter the nongovernmental function or purpose of computer 
software or is of the type customarily provided in the commercial 
marketplace.
    (16) Noncommercial computer software means software that does not 
qualify as commercial computer software under paragraph (a)(1) of this 
clause.
    (17) Restricted rights apply only to noncommercial computer software 
and mean the Government's rights to--
    (i) Use a computer program with one computer at one time. The 
program may not be accessed by more than one terminal or central 
processing unit or time shared unless otherwise permitted by this 
contract;
    (ii) Transfer a computer program to another Government agency 
without the further permission of the Contractor if the transferor 
destroys all copies of the program and related computer software 
documentation in its possession and notifies the licensor of the 
transfer. Transferred programs remain subject to the provisions of this 
clause;
    (iii) Make the minimum number of copies of the computer software 
required for safekeeping (archive), backup, or modification purposes;
    (iv) Modify computer software provided that the Government may--
    (A) Use the modified software only as provided in paragraphs (a)(17) 
(i) and (iii) of this clause; and
    (B) Not release or disclose the modified software except as provided 
in paragraphs (a)(17) (ii), (v) and (vi) of this clause;
    (v) Permit contractors or subcontractors performing service 
contracts (see 37.101 of the Federal Acquisition Regulation) in support 
of this or a related contract to use computer software to diagnose and 
correct deficiencies in a computer program, to modify computer software 
to enable a computer program to be combined with, adapted to, or merged 
with other computer programs or when necessary to respond to urgent 
tactical situations, provided that--
    (A) The Government notifies the party which has granted restricted 
rights that a release or disclosure to particular contractors or 
subcontractors was made;
    (B) Such contractors or subcontractors are subject to the non-
disclosure agreement at

[[Page 480]]

227.7103-7 of the Defense Federal Acquisition Regulation Supplement 
(DFARS or are Government contractors receiving access to the software 
for performance of a Government contract that contains the clause at 
DFARS 252.227-7025, Limitations on the Use or Disclosure of Government-
Furnished Information Marked with Restrictive Legends;
    (C) The Government shall not permit the recipient to decompile 
disassemble, or reverse engineer the software, or use software 
decompiled, disassembled, or reverse engineered by the Government 
pursuant to paragraph (a)(17)(iv) of this clause, for any other purpose; 
and
    (D) Such use is subject to the limitation in paragraph (a)(17)(i) of 
this clause; and
    (vi) Permit contractors or subcontractors performing emergency 
repairs or overhaul of items or components of items, procured under this 
or a related contract to use the computer software when necessary to 
perform the repairs or overhaul, or to modify the computer software to 
reflect the repairs or overhaul made, provided that--
    (A) The intended recipient is subject to the non-disclosure 
agreement at DFARS 227.7103-7 or is a Government contractor receiving 
access to the software for performance of a Government contract that 
contains the clause at DFARS 252.227-7025, Limitations on the Use or 
Disclosure of Government Furnished Information Marked with Restrictive 
Legends; and
    (B) The Government shall not permit the recipient to decompile, 
disassemble, or reverse engineer the software, or use software 
decompiled, disassembled, or reverse engineered by the Government 
pursuant to paragraph (a)(17)(iv) of this clause, for any other purpose.
    (18) SBIR data rights means a royalty-free license for the 
Government, including its support service contractors, to use, modify, 
reproduce, release, perform, display, or disclose technical data or 
computer software generated and delivered under this contract for any 
United States Government purpose.
    (19) Technical data means recorded information, regardless of the 
form or method of the recording, of a scientific or technical nature 
(including computer software documentation). The term does not include 
computer software or data incidental to contract administration, such as 
financial and/or management information.
    (20) Unlimited rights means rights to use, modify, reproduce, 
release, perform, display, or disclose, technical data or computer 
software in whole or in part, in any manner and for any purpose 
whatsoever, and to have or authorize others to do so.
    (b) Rights in technical data and computer software. The Contractor 
grants or shall obtain for the Government the following royalty-free, 
world-wide, nonexclusive, irrevocable license rights in technical data 
or noncommercial computer software. All rights not granted to the 
Government are retained by the Contractor.
    (1) Unlimited rights. The Government shall have unlimited rights in 
technical data, including computer software documentation, or computer 
software generated under this contract that are--
    (i) Form, fit, and function data;
    (ii) Necessary for installation, operation, maintenance, or training 
purposes (other than detailed manufacturing or process data);
    (iii) Corrections or changes to Government-furnished technical data 
or computer software;
    (iv) Otherwise publicly available or have been released or disclosed 
by the Contractor or a subcontractor without restrictions on further 
use, release or disclosure other than a release or disclosure resulting 
from the sale, transfer, or other assignment of interest in the 
technical data or computer software to another party or the sale or 
transfer of some or all of a business entity or its assets to another 
party;
    (v) Data or software in which the Government has acquired previously 
unlimited rights under another Government contract or through a specific 
license; and
    (vi) SBIR data upon expiration of the SBIR data rights period.
    (2) Limited rights. The Government shall have limited rights in 
technical data, that were not generated under this contract, pertain to 
items, components or processes developed exclusively at private expense, 
and are marked, in accordance with the marking instructions in paragraph 
(f)(1) of this clause, with the legend prescribed in paragraph (f)(2) of 
this clause.
    (3) Restricted rights in computer software. The Government shall 
have restricted rights in noncommercial computer software required to be 
delivered or otherwise furnished to the Government under this contract 
that were developed exclusively at private expense and were not 
generated under this contract.
    (4) SBIR data rights. (i) Except for technical data, including 
computer software documentation, or computer software in which the 
Government has unlimited rights under paragraph (b)(1) of this clause, 
the Government shall have SBIR data rights in all technical data or 
computer software generated under this contract during the period 
commencing with contract award and ending upon the date five years after 
completion of the project from which such data were generated.
    (ii) The Government may not release or disclose SBIR data to any 
person, other than its support services contractors, except--
    (A) As expressly permitted by the Contractor;
    (B) For evaluation purposes; or

[[Page 481]]

    (C) A release, disclosure, or use that is necessary for emergency 
repair or overhaul of items operated by the Government.
    (iii) A release or disclosure of SBIR data to the Government's 
support services contractors, or a release or disclosure under paragraph 
(b)(4)(ii)(B) or (C) of this clause, may be made only if, prior to 
release or disclosure, the intended recipient is subject to the use and 
non-disclosure agreement at DFARS 227.7103-7 or is a Government 
contractor receiving access to the technical data or software for 
performance of a Government contract that contains the clause at DFARS 
252.227-7025, Limitations on the Use of Disclosure of Government-
Furnished Information Marked with Restrictive Legends.
    (5) Specifically negotiated license rights. The standard license 
rights granted to the Government under paragraphs (b)(1) through (b)(4) 
of this clause may be modified by mutual agreement to provide such 
rights as the parties consider appropriate but shall not provide the 
Government lesser rights in technical data, including computer software 
documentation, than are enumerated in paragraph (a)(14) of this clause 
or lesser rights in computer software than are enumerated in paragraph 
(a)(17) of this clause. Any rights so negotiated shall be identified in 
a license agreement made part of this contract.
    (6) Prior government rights. Technical data, including computer 
software documentation, or computer software that will be delivered, 
furnished, or otherwise provided to the Government under this contract, 
in which the Government has previously obtained rights shall be 
delivered, furnished, or provided with the pre-existing rights, unless--
    (i) The parties have agreed otherwise; or
    (ii) Any restrictions on the Government's rights to use, modify, 
release, perform, display, or disclose the technical data or computer 
software have expired or no longer apply.
    (7) Release from liability. The Contractor agrees to release the 
Government from liability for any release or disclosure of technical 
data, computer software, or computer software documentation made in 
accordance with paragraph (a)(14), (a)(17), or (b)(4) of this clause, or 
in accordance with the terms of a license negotiated under paragraph 
(b)(5) of this clause, or by others to whom the recipient has released 
or disclosed the data, software, or documentation and to seek relief 
solely from the party who has improperly used, modified, reproduced, 
released, performed, displayed, or disclosed Contractor data or software 
marked with restrictive legends.
    (c) Rights in derivative computer software or computer software 
documentation. The Government shall retain its rights in the unchanged 
portions of any computer software or computer software documentation 
delivered under this contract that the Contractor uses to prepare, or 
includes in, derivative software or documentation.
    (d) Third party copyrighted technical data and computer software. 
The Contractor shall not, without the written approval of the 
Contracting Officer, incorporate any copyrighted technical data, 
including computer software documentation, or computer software in the 
data or software to be delivered under this contract unless the 
Contractor is the copyright owner or has obtained for the Government the 
license rights necessary to perfect a license or licenses in the 
deliverable data or software of the appropriate scope set forth in 
paragraph (b) of this clause and, prior to delivery of such--
    (1) Technical data, has affixed to the transmittal document a 
statement of the license rights obtained; or
    (2) Computer software, has provided a statement of the license 
rights obtained in a form acceptable to the Contracting Officer.
    (e) Identification and delivery of technical data or computer 
software to be furnished with restrictions on use, release, or 
disclosure. (1) This paragraph does not apply to technical data or 
computer software that were or will be generated under this contract or 
to restrictions based solely on copyright.
    (2) Except as provided in paragraph (e)(3) of this clause, technical 
data or computer software that the Contractor asserts should be 
furnished to the Government with restrictions on use, release, or 
disclosure is identified in an attachment to this contract (the 
Attachment). The Contractor shall not deliver any technical data or 
computer software with restrictive markings unless the technical data or 
computer software are listed on the Attachment.
    (3) In addition to the assertions made in the Attachment, other 
assertions may be identified after award when based on new information 
or inadvertent omissions unless the inadvertent omissions would have 
materially affected the source selection decision. Such identification 
and assertion shall be submitted to the Contracting Officer as soon as 
practicable prior to the scheduled date for delivery of the technical 
data or computer software, in the following format, and signed by an 
official authorized to contractually obligate the Contractor:

 Identification and Assertion of Restrictions on the Government's Use, 
      Release, or Disclosure of Technical Data or Computer Software

    The Contractor asserts for itself, or the persons identified below, 
that the Government's rights to use, release, or disclose the following 
technical data or computer software should be restricted:

[[Page 482]]



                                                                                                                
----------------------------------------------------------------------------------------------------------------
Technical data or computer software to    Basis for assertion      Asserted rights      Name of person asserting
  be furnished with restrictions \1\              \2\                category \3\           restrictions \4\    
----------------------------------------------------------------------------------------------------------------
(LIST)................................  (LIST)................  (LIST)...............  (LIST)                   
----------------------------------------------------------------------------------------------------------------
\1\ If the assertion is applicable to items, components, or processes developed at private expense, identify    
  both the technical data and each such item, component, or process.                                            
\2\ Generally, development at private expense, either exclusively or partially, is the only basis for asserting 
  restrictions on the Government's rights to use, release, or disclose technical data or computer software.     
  Indicate whether development was exclusively or partially at private expense. If development was not at       
  private expense, enter the specific reason for asserting that the Government's rights should be restricted.   
\3\ Enter asserted rights category (e.g., limited rights, restricted rights, government purpose rights, or      
  government purpose license rights from a prior contract, SBIR data rights under another contract, or          
  specifically negotiated licenses).                                                                            
\4\ Corporation, individual, or other person, as appropriate.                                                   

 Date___________________________________________________________________

 Printed Name and Title_________________________________________________

 Signature______________________________________________________________

                  (End of identification and assertion)

    (4) When requested by the Contracting Officer, the Contractor shall 
provide sufficient information to enable the Contracting Officer to 
evaluate the Contractor's assertions. The Contracting Officer reserves 
the right to add the Contractor's assertions to the Attachment and 
validate any listed assertions, at a later date, in accordance with the 
procedures of the Validation of Asserted Restrictions--Computer Software 
and/or Validation of Restrictive Markings on Technical Data clauses of 
this contract.
    (f) Marking requirements. The Contractor, and its subcontractors or 
suppliers, may only assert restrictions on the Government's rights to 
use, modify, reproduce, release, perform, display, or disclose technical 
data or computer software to be delivered under this contract by marking 
the deliverable data or software subject to restriction. Except as 
provided in paragraph (f)(6) of this clause, only the following markings 
are authorized under this contract: the limited rights legend at 
paragraph (f)(2) of this clause; the restricted rights legend at 
paragraph (f)(3) of this clause, the SBIR data rights legend at 
paragraph (f)(4) of this clause, or the special license rights legend at 
paragraphs (f)(5) of this clause; and/or a notice of copyright as 
prescribed under 17 U.S.C. 401 or 402.
    (1) General marking instructions. The Contractor, or its 
subcontractors or suppliers, shall conspicuously and legibly mark the 
appropriate legend to all technical data and computer software that 
qualify for such markings. The authorized legends shall be placed on the 
transmittal document or storage container and, for printed material, 
each page of the printed material containing technical data or computer 
software for which restrictions are asserted. When only portions of a 
page of printed material are subject to the asserted restrictions, such 
portions shall be identified by circling, underscoring, with a note, or 
other appropriate identifier. Technical data or computer software 
transmitted directly from one computer or computer terminal to another 
shall contain a notice of asserted restrictions. However, instructions 
that interfere with or delay the operation of computer software in order 
to display a restrictive rights legend or other license statement at any 
time prior to or during use of the computer software, or otherwise cause 
such interference or delay, shall not be inserted in software that will 
or might be used in combat or situations that simulate combat 
conditions, unless the Contracting Officer's written permission to 
deliver such software has been obtained prior to delivery. Reproductions 
of technical data, computer software, or any portions thereof subject to 
asserted restrictions shall also reproduce the asserted restrictions.
    (2) Limited rights markings. Technical data not generated under this 
contract that pertain to items, components, or processes developed 
exclusively at private expense and delivered or otherwise furnished with 
limited rights shall be marked with the following legend:

                             Limited Rights

 Contract No.___________________________________________________________

 Contractor Name________________________________________________________

 Contractor Address_____________________________________________________

 _______________________________________________________________________

The Government's rights to use, modify, reproduce, release, perform, 
display, or disclose these technical data are restricted by paragraph 
(b)(2) of the Rights in Noncommercial Technical Data and Computer 
Software--Small Business Innovative Research (SBIR) Program clause 
contained in the above identified contract. Any reproduction of 
technical data or portions thereof marked with this legend must also 
reproduce the markings. Any person, other than the Government, who has 
been provided access to such data must promptly notify the above named 
Contractor.

                             (End of legend)

    (3) Restricted rights markings. Computer software delivered or 
otherwise furnished to the Government with restricted rights shall be 
marked with the following legend:

                            Restricted Rights

 Contract No.___________________________________________________________

 Contractor Name________________________________________________________

 Contractor Address_____________________________________________________

 _______________________________________________________________________


[[Page 483]]

________________________________________________________________________
The Government's rights to use, modify, reproduce, release, perform, 
display, or disclose this software are restricted by paragraph (b)(3) of 
the Rights in Noncommercial Technical Data and Computer Software--Small 
Business Innovative Research (SBIR) Program clause contained in the 
above identified contract. Any reproduction of computer software or 
portions thereof marked with this legend must also reproduce the 
markings. Any person, other than the Government, who has been provided 
access to such data must promptly notify the above named Contractor.

                             (End of legend)

    (4) SBIR data rights markings: Except for technical data or computer 
software in which the Government has acquired unlimited rights under 
paragraph (b)(1) of this clause, or negotiated special license rights as 
provided in paragraph (b)(5) of this clause, technical data or computer 
software generated under this contract shall be marked with the 
following legend. The Contractor shall enter the expiration date for the 
SBIR data rights period on the legend:

                            SBIR Data Rights

 Contract No.___________________________________________________________

 Contractor Name________________________________________________________

 Address________________________________________________________________

 _______________________________________________________________________

Expiration of SBIR Data Rights Period___________________________________

The Government's rights to use, modify, reproduce, release, perform, 
display, or disclose technical data or computer software marked with 
this legend are restricted during the period shown as provided in 
paragraph (b)(4) of the Rights in Noncommercial Technical Data and 
Computer Software--Small Business Innovative Research (SBIR) Program 
clause contained in the above identified contract. No restrictions apply 
after the expiration date shown above. Any reproduction of technical 
data, computer software, or portions thereof marked with this legend 
must also reproduce the markings.

                             (End of legend)

    (5) Special license rights markings. (i) Technical data or computer 
software in which the Government's rights stem from a specifically 
negotiated license shall be marked with the following legend:

                         Special License Rights

    The Government's rights to use, modify, reproduce, release, perform, 
display, or disclose this technical data or computer software are 
restricted by Contract No. ________________ (Insert contract number) 
________________, License No. ________________ (Insert license 
identifier) ________________. Any reproduction of technical data, 
computer software, or portions thereof marked with this legend must also 
reproduce the markings.

                             (End of legend)

    (ii) For purposes of this clause, special licenses do not include 
government purpose license rights acquired under a prior contract (see 
paragraph (b)(6) of this clause).
    (6) Pre-existing data markings. If the terms of a prior contract or 
license permitted the Contractor to restrict the Government's rights to 
use, modify, reproduce, release, perform, display, or disclose technical 
data or computer software, and those restrictions are still applicable, 
the Contractor may mark such data or software with the appropriate 
restrictive legend for which the data or software qualified under the 
prior contract or license. The marking procedures in paragraph (f)(1) of 
this clause shall be followed.
    (g) Contractor procedures and records. Throughout performance of 
this contract, the Contractor, and its subcontractors or suppliers that 
will deliver technical data or computer software with other than 
unlimited rights, shall--
    (1) Have, maintain, and follow written procedures sufficient to 
assure that restrictive markings are used only when authorized by the 
terms of this clause; and
    (2) Maintain records sufficient to justify the validity of any 
restrictive markings on technical data or computer software delivered 
under this contract.
    (h) Removal of unjustified and nonconforming markings.
    (1) Unjustified markings. The rights and obligations of the parties 
regarding the validation of restrictive markings on technical data or 
computer software furnished or to be furnished under this contract are 
contained in the Validation of Restrictive Markings on Technical Data 
and the Validation of Asserted Restrictions--Computer Software clauses 
of this contract, respectively. Notwithstanding any provision of this 
contract concerning inspection and acceptance, the Government may ignore 
or, at the Contractor's expense, correct or strike a marking if, in 
accordance with the applicable procedures of those clauses, a 
restrictive marking is determined to be unjustified.
    (2) Nonconforming markings. A nonconforming marking is a marking 
placed on technical data or computer software delivered or otherwise 
furnished to the Government under this contract that is not in the 
format authorized by this contract. Correction of nonconforming markings 
is not subject to the Validation of Restrictive Markings on Technical 
Data or the Validation of Asserted Restrictions--Computer Software 
clause of

[[Page 484]]

this contract. If the Contracting Officer notifies the Contractor of a 
nonconforming marking or markings and the Contractor fails to remove or 
correct such markings within sixty (6)) days, the Government may ignore 
or, at the Contractor's expense, remove or correct any nonconforming 
markings.
    (i) Relation to patents. Nothing contained in this clause shall 
imply a license to the Government under any patent or be construed as 
affecting the scope of any license or other right otherwise granted to 
the Government under any patent.
    (j) Limitation on charges for rights in technical data or computer 
software. (1) The Contractor shall not charge to this contract any cost, 
including but not limited to, license fees, royalties, or similar 
charges, for rights in technical data or computer software to be 
delivered under this contract when--
    (i) The Government has acquired, by any means, the same or greater 
rights in the data or software; or
    (ii) The data are available to the public without restrictions.
    (2) The limitation in paragraph (j)(1) of this clause--
    (i) Includes costs charged by a subcontractor or supplier, at any 
tier, or costs incurred by the Contractor to acquire rights in 
subcontractor of supplier technical data or computer software, if the 
subcontractor or supplier has been paid for such rights under any other 
Government contract or under a license conveying the rights to the 
Government; and
    (ii) Does not include the reasonable costs of reproducing, handling, 
or mailing the documents or other media in which the technical data or 
computer software will be delivered.
    (k) Applicability to subcontractors or suppliers. (1) the Contractor 
shall assure that the rights afforded its subcontractors and suppliers 
under 10 U.S.C. 2320, 10 U.S.C. 2321, and the identification, assertion, 
and delivery processes required by paragraph (e) of this clause are 
recognized and protected.
    (2) Whenever any noncommercial technical data or computer software 
is to be obtained from a subcontractor or supplier for delivery to the 
Government under this contract, the Contractor shall use this same 
clause in the subcontract or other contractual instrument, and require 
its subcontractors or suppliers to do so, without alteration, except to 
identify the parties. The Contractor shall use the Technical Data--
Commercial Items clause of this contract to obtain technical data 
pertaining to commercial items, components, or processes. No other 
clause shall be used to enlarge or diminish the Government's, the 
Contractor's, or a higher tier subcontractor's or supplier's rights in a 
subcontractor's or supplier's technical data or computer software.
    (3) Technical data required to be delivered by a subcontractor or 
supplier shall normally be delivered to the next higher tier contractor, 
subcontractor, or supplier. However, when there is a requirement in the 
prime contract for technical data which may be submitted with other than 
unlimited rights by a subcontractor or supplier, then said subcontractor 
or supplier may fulfill its requirement by submitting such technical 
data directly to the Government, rather than through a higher tier 
contractor, subcontractor, or supplier.
    (4) The Contractor and higher tier subcontractors or suppliers shall 
not use their power to award contracts as economic leverage to obtain 
rights in technical data or computer software from their subcontractors 
or suppliers.
    (5) In no event shall the Contractor use its obligation to recognize 
and protect subcontractor or supplier rights in technical data or 
computer software as an excuse for failing to satisfy its contractual 
obligation to the Government.

                             (End of clause)

                         Alternate I (June 1995)

    As prescribed in 227.7104(d), add the following paragraph (l) to the 
basic clause:
    (l) Publication for sale. (1) This paragraph applies only to 
technical data or computer software delivered to the Government with 
SBIR data rights.
    (2) Upon expiration of the SBIR data rights period, the Government 
will not exercise its right to publish or authorize others to publish an 
item of technical data or computer software identified in this contract 
as being subject to paragraph (l) of this clause if the Contractor, 
prior to the expiration of the SBIR data rights period, or within two 
years following delivery of the data or software item, or within twenty-
four months following the removal of any national security or export 
control restrictions, whichever is later, publishes such data or 
software item(s) and promptly notifies the Contracting Officer of such 
publication(s). Any such publication(s) shall include a notice 
identifying the number of this contract and the Government's rights in 
the published data.
    (3) This limitation on the Government's right to publish for sale 
shall continue as long as the technical data or computer software are 
reasonably available to the public for purchase.
[60 FR 33499, June 28, 1995, as amended at 60 FR 61602, Nov. 30, 1995]



252.227-7019  Validation of asserted restrictions--Computer software.

    As prescribed in 227.7104(e)(3) or 227.7203-6(c), use the following 
clause:

[[Page 485]]

   Validation of Asserted Restrictions--Computer Software (June 1995)

    (a) Definitions. (1) As used in this clause, unless otherwise 
specifically indicated, the term ``Contractor'' means the Contractor and 
its subcontractors or suppliers.
    (2) Other terms used in this clause are defined in the Rights in 
Noncommercial Computer Software and Noncommercial Computer Software 
Documentation clause of this contract.
    (b) Justification. The Contractor shall maintain records sufficient 
to justify the validity of any markings that assert restrictions on the 
Government's rights to use, modify, reproduce, perform, display, 
release, or disclose computer software delivered or required to be 
delivered under this contract and shall be prepared to furnish to the 
Contracting Officer a written justification for such restrictive 
markings in response to a request for information under paragraph (d) or 
a challenge under paragraph (f) of this clause.
    (c) Direct contact with subcontractors or suppliers. The Contractor 
agrees that the Contracting Officer may transact matters under this 
clause directly with subcontractors or suppliers at any tier who assert 
restrictions on the Government's right to use, modify, reproduce, 
release, perform, display, or disclose computer software. Neither this 
clause, nor any action taken by the Government under this clause, 
creates or implies privity of contract between the Government and the 
Contractor's subcontractors or suppliers.
    (d) Requests for information. (1) The Contracting Officer may 
request the Contractor to provide sufficient information to enable the 
Contracting Officer to evaluate the Contractor's asserted restrictions. 
Such information shall be based upon the records required by this clause 
or other information reasonably available to the Contractor.
    (2) Based upon the information provided, if the--
    (i) Contractor agrees that an asserted restriction is not valid, the 
Contracting Officer may--
    (A) Strike or correct the unjustified marking at the Contractor's 
expense; or
    (B) Return the computer software to the Contractor for correction at 
the Contractor's expense. If the Contractor fails to correct or strike 
the unjustified restrictions and return the corrected software to the 
Contracting Officer within sixty (60) days following receipt of the 
software, the Contracting Officer may correct the strike the markings at 
the Contractor's expense.
    (ii) Contracting Officer concludes that the asserted restriction is 
appropriate for this contract, the Contracting Officer shall so notify 
the Contractor in writing.
    (3) The Contractor's failure to provide a timely response to a 
Contracting Officer's request for information or failure to provide 
sufficient information to enable the Contracting Officer to evaluate an 
asserted restriction shall constitute reasonable grounds for questioning 
the validity of an asserted restriction.
    (e) Government right to challenge and validate asserted 
restrictions. (1) The Government, when there are reasonable grounds to 
do so, has the right to review and challenge the validity of any 
restrictions asserted by the Contractor on the Government's rights to 
use, modify, reproduce, release, perform, display, or disclose computer 
software delivered, to be delivered under this contract, or otherwise 
provided to the Government in the performance of this contract. Except 
for software that is publicly available, has been furnished to the 
Government without restrictions, or has been otherwise made available 
without restrictions, the Government may exercise this right only within 
three years after the date(s) the software is delivered or otherwise 
furnished to the Government, or three years following final payment 
under this contract, whichever is later.
    (2) The absence of a challenge to an asserted restriction shall not 
constitute validation under this clause. Only a Contracting Officer's 
final decision or actions of an agency Board of Contract Appeals or a 
court of competent jurisdiction that sustain the validity of an asserted 
restriction constitute validation of the restriction.
    (f) Challenge procedures. (1) A challenge must be in writing and 
shall--
    (i) State the specific grounds for challenging the asserted 
restriction;
    (ii) Require the Contractor to respond within sixty (60) days;
    (iii) Require the Contractor to provide justification for the 
assertion based upon records kept in accordance with paragraph (b) of 
this clause and such other documentation that are reasonably available 
to the Contractor, in sufficient detail to enable the Contracting 
Officer to determine the validity of the asserted restrictions; and
    (iv) State that a Contracting Officer's final decision, during the 
three-year period preceding this challenge, or action of a court of 
competent jurisdiction or Board of Contract Appeals that sustained the 
validity of an identical assertion made by the Contractor (or a 
licensee) shall serve as justification for the asserted restriction.
    (2) The Contracting Officer shall extend the time for response if 
the Contractor submits a written request showing the need for additional 
time to prepare a response.
    (3) The Contracting Officer may request additional supporting 
documentation if, in the Contracting Officer's opinion, the Contractor's 
explanation does not provide sufficient evidence to justify the validity 
of the asserted restrictions. The Contractor agrees

[[Page 486]]

to promptly respond to the Contracting Officer's request for additional 
supporting documentation.
    (4) Notwithstanding challenge by the Contracting Officer, the 
parties may agree on the disposition of an asserted restriction at any 
time prior to a Contracting Officer's final decision or, if the 
Contractor has appealed that decision, filed suit, or provided notice of 
an intent to file suit, at any time prior to a decision by a court of 
competent jurisdiction or Board of Contract Appeals.
    (5) If the Contractor fails to respond to the Contracting Officer's 
request for information or additional information under paragraph (f)(1) 
of this clause, the Contracting Officer shall issue a final decision, in 
accordance with the Disputes clause of this contract, pertaining to the 
validity of the asserted restriction.
    (6) If the Contracting Officer, after reviewing the written 
explanation furnished pursuant to paragraph (f)(1) of this clause, or 
any other available information pertaining to the validity of an 
asserted restriction, determines that the asserted restriction has--
    (i) Not been justified, the Contracting Officer shall issue promptly 
a final decision, in accordance with the Disputes clause of this 
contract, denying the validity of the asserted restriction; or
    (ii) Been justified, the Contracting Officer shall issue promptly a 
final decision, in accordance with the Disputes clause of this contract, 
validating the asserted restriction.
    (7) A Contractor receiving challenges to the same asserted 
restriction(s) from more than one Contracting Officer shall notify each 
Contracting Officer of the other challenges. The notice shall also state 
which Contracting Officer initiated the first in time unanswered 
challenge. The Contracting Officer who initiated the first in time 
unanswered challenge, after consultation with the other Contracting 
Officers who have challenged the restrictions and the Contractor, shall 
formulate and distribute a schedule that provides the contractor a 
reasonable opportunity for responding to each challenge.
    (g) Contractor appeal--Government obligation. (1) The Government 
agrees that, notwithstanding a Contracting Officer's final decision 
denying the validity of an asserted restriction and except as provided 
in paragraph (g)(3) of this clause, it will honor the asserted 
restriction--
    (i) For a period of ninety (90) days from the date of the 
Contracting Officer's final decision to allow the Contractor to appeal 
to the appropriate Board of Contract Appeals or to file suit in an 
appropriate court;
    (ii) For a period of one year from the date of the Contracting 
Officer's final decision if, within the first ninety (90) days following 
the Contracting Officer's final decision, the Contractor has provided 
notice of an intent to file suit in an appropriate court; or
    (iii) Until final disposition by the appropriate Board of Contract 
Appeals or court of competent jurisdiction, if the Contractor has: (A) 
appealed to the Board of Contract Appeals or filed suit an appropriate 
court within ninety (90) days; or (B) submitted, within ninety (90) 
days, a notice of intent to file suit in an appropriate court and filed 
suit within one year.
    (2) The Contractor agrees that the Government may strike, correct, 
or ignore the restrictive markings if the Contractor fails to--
    (i) Appeal to a Board of Contract Appeals within ninety (90) days 
from the date of the Contracting Officer's final decision;
    (ii) File suit in an appropriate court within ninety (90) days from 
such date; or
    (iii) File suit within one year after the date of the Contracting 
Officer's final decision if the Contractor had provided notice of intent 
to file suit within ninety (90) days following the date of the 
Contracting Officer's final decision.
    (3) The agency head, on a nondelegable basis, may determine that 
urgent or compelling circumstances do not permit awaiting the filing of 
suit in an appropriate court, or the rendering of a decision by a court 
of competent jurisdiction or Board of Contract Appeals. In that event, 
the agency head shall notify the Contractor of the urgent or compelling 
circumstances. Notwithstanding paragraph (g)(1) of this clause, the 
Contractor agrees that the agency may use, modify, reproduce, release, 
perform, display, or disclose computer software marked with (i) 
government purpose legends for any purpose, and authorize others to do 
so; or (ii) restricted or special license rights for government purposes 
only. The Government agrees not to release or disclose such software 
unless, prior to release or disclosure, the intended recipient is 
subject to the use and non-disclosure agreement at 227.7103-7 of the 
Defense Federal Acquisition Regulation Supplement (DFARS), or is a 
Government contractor receiving access to the software for performance 
of a Government contract that contains the clause at DFARS 252.227-7025, 
Limitations on the Use or Disclosure of Government-Furnished Information 
Marked with Restrictive Legends. The agency head's determination may be 
made at any time after the date of the Contracting Officer's final 
decision and shall not affect the Contractor's right to damages against 
the United States, or other relief provided by law, if its asserted 
restrictions are ultimately upheld.
    (h) Final disposition of appeal or suit. If the Contractor appeals 
or files suit and if, upon final disposition of the appeal or suit, the 
Contracting Officer's decision is:
    (1) Sustained--

[[Page 487]]

    (i) Any restrictive marking on such computer software shall be 
struck or corrected at the contractor's expense or ignored; and
    (ii) If the asserted restriction is found not to be substantially 
justified, the Contractor shall be liable to the Government for payment 
of the cost to the Government of reviewing the asserted restriction and 
the fees and other expenses (as defined in 28 U.S.C. 2412(d)(2)(A)) 
incurred by the Government in challenging the restriction, unless 
special circumstances would make such payment unjust.
    (2) Not sustained--
    (i) The Government shall be bound by the asserted restriction; and
    (ii) If the challenge by the Government is found not to have been 
made in good faith, the Government shall be liable to the Contractor for 
payment of fees and other expenses (as defined in 28 U.S.C. 
2412(d)(2)(A)) incurred by the Contractor in defending the restriction.
    (i) Flowdown. The Contractor shall insert this clause in all 
contracts, purchase orders, and other similar instruments with its 
subcontractors or suppliers, at any tier, who will be furnishing 
computer software to the Government in the performance of this contract. 
The clause may not be altered other than to identify the appropriate 
parties.

                             (End of clause)

[60 FR 33503, June 28, 1995]



252.227-7020  Rights in special works.

    As prescribed in 227.7105-3, 227.7106(a) or 227.7205(a), use the 
following clause:

                   Rights in Special Works (June 1995)

    (a) Applicability. This clause applies to works first created, 
generated, or produced and required to be delivered under this contract.
    (b) Definitions. As used in this clause:
    (1) ``Computer data base'' means a collection of data recorded in a 
form capable of being processed by a computer. The term does not include 
computer software.
    (2) ``Computer program'' means a set of instructions, rules, or 
routines recorded in a form that is capable of causing a computer to 
perform a specific operation or series of operations.
    (3) ``Computer software'' means computer programs, source code, 
source code listings, object code listings, design details, algorithms, 
processes, flow charts, formulae and related material that would enable 
the software to be reproduced, recreated, or recompiled. Computer 
software does not include computer data bases or computer software 
documentation.
    (4) ``Computer software documentation'' means owner's manuals, 
user's manuals, installation instructions, operating instructions, and 
other similar items, regardless of storage medium, that explain the 
capabilities of the computer software or provide instructions for using 
the software.
    (5) ``Unlimited rights'' means the rights to use, modify, reproduce, 
perform, display, release, or disclose a work in whole or in part, in 
any manner, and for any purpose whatsoever, and to have or authorize 
others to do so.
    (6) The term ``works'' includes computer data bases, computer 
software, or computer software documentation; literary, musical, 
choreographic, or dramatic compositions; pantomimes; pictorial, graphic, 
or sculptural compositions; motion pictures and other audiovisual 
compositions; sound recordings in any medium; or, items of similar 
nature.
    (c) License rights. (1) The Government shall have unlimited rights 
in works first produced, created, or generated and required to be 
delivered under this contract.
    (2) When a work is first produced, created, or generated under this 
contract, and such work is required to be delivered under this contract, 
the Contractor shall assign copyright in those works to the Government. 
The Contractor, unless directed to the contrary by the Contracting 
Officer, shall place the following notice on such works: `` 
(Year date of delivery) United States Government, as represented by the 
Secretary of (department). All rights reserved.''
    For phonorecords, the ``'' markings shall be replaced by 
a ``P''.
    (3) The Contractor grants to the Government a royalty-free, world-
wide, nonexclusive, irrevocable license to reproduce, prepare derivative 
works from, distribute, perform, or display, and to have or authorize 
others to do so, the Contractor's copyrighted works not first produced, 
created, or generated under this contract that have been incorporated 
into the works deliverable under this contract.
    (d) Third party copyrighted data. The Contractor shall not 
incorporate, without the written approval of the Contracting Officer, 
any copyrighted works in the works to be delivered under this contract 
unless the Contractor is the copyright owner or has obtained for the 
Government the license rights necessary to perfect a license of the 
scope identified in paragraph (c)(3) of this clause and, prior to 
delivery of such works--
    (1) Has affixed to the transmittal document a statement of the 
license rights obtained; or
    (2) For computer software, has provided a statement of the license 
rights obtained in a form acceptable to the Contracting Officer.
    (e) Indemnification. The Contractor shall indemnify and save and 
hold harmless the Government, and its officers, agents and employees 
acting for the Government, against any liability, including costs and 
expenses,

[[Page 488]]

(1) for violation of proprietary rights, copyrights, or rights of 
privacy or publicity, arising out of the creation, delivery, use, 
modification, reproduction, release, performance, display, or disclosure 
of any works furnished under this contract, or (2) based upon any 
libelous or other unlawful matter contained in such works.
    (f) Government-furnished information. Paragraphs (d) and (e) of this 
clause are not applicable to information furnished to the Contractor by 
the Government and incorporated in the works delivered under this 
contract.

                             (End of clause)

[60 FR 33504, June 28, 1995]



252.227-7021  Rights in data--existing works.

    As prescribed at 227.7105-2(a), use the following clause:

               Rights in Data--Existing Works (Mar. 1979)

    (a) The term works as used herein includes literary, musical, and 
dramatic works; pantomimes and choreographic works; pictorial, graphic 
and sculptural works; motion pictures and other audiovisual works; sound 
recordings; and works of a similar nature. The term does not include 
financial reports, cost analyses, and other information incidental to 
contract administration.
    (b) Except as otherwise provided in this contract, the Contractor 
hereby grants to the Government a nonexclusive, paid-up license 
throughout the world (1) to distribute, perform publicly, and display 
publicly the works called for under this contract and (2) to authorize 
others to do so for Government purposes.
    (c) The Contractor shall indemnify and save and hold harmless the 
Government, and its officers, agents, and employees acting for the 
Government, against any liability, including costs and expenses, (1) for 
violation of proprietary rights, copyrights, or rights of privacy or 
publicity arising out of the creation, delivery, or use, of any works 
furnished under this contract, or (2) based upon any libelous or other 
unlawful matter contained in same works.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 60 FR 33504, June 28, 1994]



252.227-7022  Government rights (unlimited).

    As prescribed at 227.7107-1(a), use the following clause:

                Government Rights (Unlimited) (Mar. 1979)

    The Government shall have unlimited rights, in all drawings, 
designs, specifications, notes and other works developed in the 
performance of this contract, including the right to use same on any 
other Government design or construction without additional compensation 
to the Contractor. The Contractor hereby grants to the Government a 
paid-up license throughout the world to all such works to which he may 
assert or establish any claim under design patent or copyright laws. The 
Contractor for a period of three (3) years after completion of the 
project agrees to furnish the original or copies of all such works on 
the request of the Contracting Officer.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 60 FR 33504, June 28, 1994]



252.227-7023  Drawings and other data to become property of government.

    As prescribed at 227.7107-1(b), use the following clause:

  Drawings and Other Data to Become Property of Government (Mar. 1979)

    All designs, drawings, specifications, notes and other works 
developed in the performance of this contract shall become the sole 
property of the Government and may be used on any other design or 
construction without additional compensation to the Contractor. The 
Government shall be considered the ``person for whom the work was 
prepared'' for the purpose of authorship in any copyrightable work under 
17 U.S.C. 201(b). With respect thereto, the Contractor agrees not to 
assert or authorize others to assert any rights nor establish any claim 
under the design patent or copyright laws. The Contractor for a period 
of three (3) years after completion of the project agrees to furnish all 
retained works on the request of the Contracting Officer. Unless 
otherwise provided in this contract, the Contractor shall have the right 
to retain copies of all works beyond such period.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 60 FR 33505, June 28, 1995]



252.227-7024  Notice and approval of restricted designs.

    As prescribed at 227.7107-3, use the following clause:

[[Page 489]]

          Notice and Approval of Restricted Designs (Apr. 1984)

    In the performance of this contract, the Contractor shall, to the 
extent practicable, make maximum use of structures, machines, products, 
materials, construction methods, and equipment that are readily 
available through Government or competitive commercial channels, or 
through standard or proven production techniques, methods, and 
processes. Unless approved by the Contracting Officer, the Contractor 
shall not produce a design or specification that requires in this 
construction work the use of structures, products, materials, 
construction equipment, or processes that are known by the Contractor to 
be available only from a sole source. The Contractor shall promptly 
report any such design or specification to the Contracting Officer and 
give the reason why it is considered necessary to so restrict the design 
or specification.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 60 FR 33505, June 28, 1995]



252.227-7025  Limitations on the use or disclosure of government-furnished information marked with restrictive legends.

    As prescribed in 227.7103-6(c), 227.7104(f)(1), or 227.7203-6(d), 
use the following clause:

Limitations on the Use or Disclosure of Government-Furnished Information 
               Marked With Restrictive Legends (June 1995)

    (a)(1) For contracts requiring the delivery of technical data, the 
terms ``limited rights'' and ``Government purpose rights'' are defined 
in the Rights in Technical Data--Noncommercial Items clause of this 
contract.
    (2) For contracts that do not require the delivery of technical 
data, the terms ``government purpose rights'' and ``restricted rights'' 
are defined in the Rights in Noncommercial Computer Software and 
Noncommercial Computer Software Documentation clause of this contract.
    (3) For Small Business Innovative Research program contracts, the 
terms ``limited rights'' and ``restricted rights'' are defined in the 
Rights in Noncommercial Technical Data and Computer Software--Small 
Business Innovative Research (SBIR) Program clause of this contract.
    (b) Technical data or computer software provided to the Contractor 
as Government furnished information (GFI) under this contract may be 
subject to restrictions on use, modification, reproduction, release, 
performance, display, or further disclosure.
    (1) GFI marked with limited or restricted rights legends. The 
Contractor shall use, modify, reproduce, perform, or display technical 
data received from the Government with limited rights legends or 
computer software received with restricted rights legends only in the 
performance of this contract. The Contractor shall not, without the 
express written permission of the party whose name appears in the 
legend, release or disclose such data or software to any person.
    (2) GFI marked with government purpose rights legends. The 
Contractor shall use technical data or computer software received from 
the Government with government purpose rights legends for government 
purposes only. The Contractor shall not, without the express written 
permission of the party whose name appears in the restrictive legend, 
use, modify, reproduce, release, perform, or display such data or 
software for any commercial purpose or disclose such data or software to 
a person other than its subcontractors, suppliers, or prospective 
subcontractors or suppliers, who require the data or software to submit 
offers for, or perform, contracts under this contract. Prior to 
disclosing the data or software, the Contractor shall require the 
persons to whom disclosure will be made to complete and sign the non-
disclosure agreement at 227.7103-7 of the Defense Federal Acquisition 
Regulation Supplement (DFARS).
    (3) GFI marked with specially negotiated license rights legends. The 
Contractor shall use, modify, reproduce, release, perform, or display 
technical data or computer software received from the Government with 
specially negotiated license legends only as permitted in the license. 
Such data or software may not be released or disclosed to other persons 
unless permitted by the license and, prior to release or disclosure, the 
intended recipient has completed the non-disclosure agreement at DFARS 
227.7103-7. The Contractor shall modify paragraph (1)(c) of the non-
disclosure agreement to reflect the recipient's obligations regarding 
use, modification, reproduction, release, performance, display, and 
disclosure of the data or software.
    (c) Indemnification and creation of third party beneficiary rights. 
The Contractor agrees--
    (1) To indemnify and hold harmless the Government, its agents, and 
employees from every claim or liability, including attorneys fees, court 
costs, and expenses, arising out of, or in any way related to, the 
misuse or unauthorized modification, reproduction, release, performance, 
display, or disclosure of technical data or computer software received 
from the Government with restrictive legends by the Contractor or any 
person to whom the Contractor has released or disclosed such data or 
software; and
    (2) That the party whose name appears on the restrictive legend, in 
addition to any

[[Page 490]]

other rights it may have, is a third party beneficiary who has the right 
of direct action against the Contractor, or any person to whom the 
Contractor has released or disclosed such data or software, for the 
unauthorized duplication, release, or disclosure of technical data or 
computer software subject to restrictive legends.

                             (End of clause)

[60 FR 33505, June 28, 1995]



252.227-7026  Deferred delivery of technical data or computer software.

    As prescribed at 227.7103-8(a), use the following clause:

  Deferred Delivery of Technical Data or Computer Software (Apr. 1988)

    The Government shall have the right to require, at any time during 
the performance of this contract, within two (2) years after either 
acceptance of all items (other than data or computer software) to be 
delivered under this contract or termination of this contract, whichever 
is later, delivery of any technical data or computer software item 
identified in this contract as ``deferred delivery'' data or computer 
software. The obligation to furnish such technical data required to be 
prepared by a subcontractor and pertaining to an item obtained from him 
shall expire two (2) years after the date Contractor accepts the last 
delivery of that item from that subcontractor for use in performing this 
contract.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 60 FR 33505, June 28, 1995]



252.227-7027  Deferred ordering of technical data or computer software.

    As prescribed at 227.7103-8(b), use the following clause:

  Deferred Ordering of Technical Data or Computer Software (Apr. 1988)

    In addition to technical data or computer software specified 
elsewhere in this contract to be delivered hereunder, the Government 
may, at any time during the performance of this contract or within a 
period of three (3) years after acceptance of all items (other than 
technical data or computer software) to be delivered under this contract 
or the termination of this contract, order any technical data or 
computer software generated in the performance of this contract or any 
subcontract hereunder. When the technical data or computer software is 
ordered, the Contractor shall be compensated for converting the data or 
computer software into the prescribed form, for reproduction and 
delivery. The obligation to deliver the technical data of a 
subcontractor and pertaining to an item obtained from him shall expire 
three (3) years after the date the Contractor accepts the last delivery 
of that item from that subcontractor under this contract. The 
Government's rights to use said data or computer software shall be 
pursuant to the ``Rights in Technical Data and Computer Software'' 
clause of this contract.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 60 FR 33505, June 28, 1995]



252.227-7028  Technical data or computer software previously delivered to the government.

    As prescribed in 227.7103-6(d), 227.7104(f)(2), or 227.7203-6(e), 
use the following provision:

    Technical Data or Computer Software Previously Delivered to the 
                         Government (June 1995)

    The Offeror shall attach to its offer an identification of all 
documents or other media incorporating technical data or computer 
software it intends to deliver under this contract with other than 
unlimited rights that are identical or substantially similar to 
documents or other media that the Offeror has produced for, delivered 
to, or is obligated to deliver to the Government under any contract or 
subcontract. The attachment shall identify--
    (a) The contract number under which the data or software were 
produced;
    (b) The contract number under which, and the name and address of the 
organization to whom, the data or software were most recently delivered 
or will be delivered; and
    (c) Any limitations on the Government's rights to use or disclose 
the data or software, including, when applicable, identification of the 
earliest date the limitations expire.

                           (End of provision)

[60 FR 33505, June 28, 1995]



252.227-7029  [Reserved]



252.227-7030  Technical data--withholding of payment.

    As prescribed at 227.7103-6(e)(2) or 227.7104(e)(4), use the 
following clause:

[[Page 491]]

           Technical Data--Withholding of Payment (Oct. 1988)

    (a) If technical data specified to be delivered under this contract, 
is not delivered within the time specified by this contract or is 
deficient upon delivery (including having restrictive markings not 
identified in the list described in the clause at 252.227-7013(k) of 
this contract), the Contracting Officer may until such data is accepted 
by the Government, withhold payment to the Contractor of ten percent 
(10%) of the total contract price or amount unless a lesser withholding 
is specified in the contract. Payments shall not be withheld nor any 
other action taken pursuant to this paragraph when the Contractor's 
failure to make timely delivery or to deliver such data without 
deficiencies arises out of causes beyond the control and without the 
fault or negligence of the Contractor.
    (b) The withholding of any amount or subsequent payment to the 
Contractor shall not be construed as a waiver of any rights accruing to 
the Government under this contract.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 60 FR 33505, June 28, 1995; 
62 FR 34132, June 24, 1997]



252.227-7031  [Reserved]



252.227-7032  Rights in technical data and computer software (foreign).

    As prescribed in 227.7103-17, use the following clause:

  Rights in Technical Data and Computer Software (Foreign) (June 1975)

    The United States Government may duplicate, use, and disclose in any 
manner for any purposes whatsoever, including delivery to other 
governments for the furtherance of mutual defense of the United States 
Government and other governments, all technical data including reports, 
drawings and blueprints, and all computer software, specified to be 
delivered by the Contractor to the United States Government under this 
contract.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 60 FR 33505, June 28, 1995]



252.227-7033  Rights in shop drawings.

    As prescribed in 227.7107-(1)(c), use the following clause:

                   Rights in Shop Drawings (Apr. 1966)

    (a) Shop drawings for construction means drawings, submitted to the 
Government by the Construction Contractor, subcontractor or any lower-
tier subcontractor pursuant to a construction contract, showing in 
detail (i) the proposed fabrication and assembly of structural elements 
and (ii) the installation (i.e., form, fit, and attachment details) of 
materials or equipment. The Government may duplicate, use, and disclose 
in any manner and for any purpose shop drawings delivered under this 
contract.
    (b) This clause, including this paragraph (b), shall be included in 
all subcontracts hereunder at any tier.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 60 FR 33505, June 28, 1995]



252.227-7034  Patents--subcontracts.

    As prescribed at 227.304-4, insert the following clause:

                    Patents--Subcontracts (Apr. 1984)

    The Contractor will include the clause at FAR 52.227-12, Patent 
Rights--Retention by the Contractor (Long Form), suitably modified to 
identify the parties, in all subcontracts, regardless of tier, for 
experimental, developmental, or research work to be performed by other 
than a small business firm or nonprofit organization.

                             (End of clause)



252.227-7035  [Reserved]



252.227-7036  Declaration of Technical Data Conformity.

    As prescribed at 227.7103-6(e)(3) or 227.7104(e)(5), use the 
following clause:

           Declaration of Technical Data Conformity (JAN 1997)

    All technical data delivered under this contract shall be 
accompanied by the following written declaration: The Contractor, 
____________________, hereby declares that, to the best of its knowledge 
and belief, the technical data delivered herewith under Contract No. 
____________________ is complete, accurate, and complies with all 
requirements of the contract.

 Date___________________________________________________________________

 Name and Title of Authorized Official__________________________________

                             (End of clause)

[62 FR 2614, Jan. 17, 1997]

[[Page 492]]



252.227-7037  Validation of restrictive markings on technical data.

    As prescribed in 227.7102-3(c), 227.7103(e)(4), 227.7104(e)(6), or 
227.7203-6(f), use the following clause:

     Validation of Restrictive Markings on Technical Data (NOV 1995)

    (a) Definitions. The terms used in this clause are defined in the 
Rights in Technical Data--Noncommercial Items clause of this contract.
    (b) Contracts for commercial items--presumption of development at 
private expense. Under a contract for a commercial item, component, or 
process, the Department of Defense shall presume that a Contractor's 
asserted use or release restrictions are justified on the basis that the 
item, component, or process was developed exclusively at private 
expense. The Department shall not challenge such assertions unless 
information the Department demonstrates that the item, component, or 
process was not developed exclusively at private expense.
    (c) Justification. The Contractor or subcontractor at any tier is 
responsible for maintaining records sufficient to justify the validity 
of its markings that impose restrictions on the Government and others to 
use, duplicate, or disclose technical data delivered or required to be 
delivered under the contract or subcontract. Except under contracts for 
commercial items, the Contractor or subcontractor shall be prepared to 
furnish to the Contracting Officer a written justification for such 
restrictive markings in response to a challenge under paragraph (e) of 
this clause.
    (d) Prechallenge request for information. (1) The Contracting 
Officer may request the Contractor or subcontractor to furnish a written 
explanation for any restriction asserted by the Contractor or 
subcontractor on the right of the United States or others to use 
technical data. If, upon review of the explanation submitted, the 
Contracting Officer remains unable to ascertain the basis of the 
restrictive marking, the Contracting Officer may further request the 
Contractor or subcontractor to furnish additional information in the 
records of, or otherwise in the possession of or reasonably available 
to, the Contractor or subcontractor to justify the validity of any 
restrictive marking on technical data delivered or to be delivered under 
the contract or subcontract (e.g., a statement of facts accompanied with 
supporting documentation). The Contractor or subcontractor shall submit 
such written data as requested by the Contracting Officer within the 
time required or such longer period as may be mutually agreed.
    (2) If the Contracting Officer, after reviewing the written data 
furnished pursuant to paragraph (d)(1) of this clause, or any other 
available information pertaining to the validity of a restrictive 
marking, determines that reasonable grounds exist to question the 
current validity of the marking and that continued adherence to the 
marking would make impracticable the subsequent competitive acquisition 
of the item, component, or process to which the technical data relates, 
the Contracting Officer shall follow the procedures in paragraph (e) of 
this clause.
    (3) If the Contractor or subcontractor fails to respond to the 
Contracting Officer's request for information under paragraph (d)(1) of 
this clause, and the Contracting Officer determines that continued 
adherence to the marking would make impracticable the subsequent 
competitive acquisition of the item, component, or process to which the 
technical data relates, the Contracting Officer may challenge the 
validity of the marking as described in paragraph (e) of this clause.
    (e) Challenge. (1) Notwithstanding any provision of this contract 
concerning inspection and acceptance, if the Contracting Officer 
determines that a challenge to the restrictive marking is warranted, the 
Contracting Officer shall send a written challenge notice to the 
Contractor or subcontractor asserting the restrictive markings. Such 
challenge shall--
    (i) State the specific grounds for challenging the asserted 
restriction;
    (ii) Require a response within sixty (60) days justifying and 
providing sufficient evidence as to the current validity of the asserted 
restriction;
    (iii) State that a DoD Contracting Officer's final decision, issued 
pursuant to paragraph (g) of this clause, sustaining the validity of a 
restrictive marking identical to the asserted restriction, within the 
three-year period preceding the challenge, shall serve as justification 
for the asserted restriction if the validated restriction was asserted 
by the same Contractor or subcontractor (or any licensee of such 
Contractor or subcontractor) to which such notice is being provided; and
    (iv) State that failure to respond to the challenge notice may 
result in issuance of a final decision pursuant to paragraph (f) of this 
clause.
    (2) The Contracting Officer shall extend the time for response as 
appropriate if the Contractor or subcontractor submits a written request 
showing the need for additional time to prepare a response.
    (3) The Contractor's or subcontractor's written response shall be 
considered a claim within the meaning of the Contract Disputes Act of 
1978 (41 U.S.C. 601, et seq.), and shall be certified in the form 
prescribed at 33.207 of the Federal Acquisition Regulation, regardless 
of dollar amount.
    (4) A Contractor or subcontractor receiving challenges to the same 
restrictive markings from more than one Contracting Officer shall

[[Page 493]]

notify each Contracting Officer of the existence of more than one 
challenge. The notice shall also state which Contracting Officer 
initiated the first in time unanswered challenge. The Contracting 
Officer initiating the first in time unanswered challenge after 
consultation with the Contractor or subcontractor and the other 
Contracting Officers, shall formulate and distribute a schedule for 
responding to each of the challenge notices to all interested parties. 
The schedule shall afford the Contractor or subcontractor an opportunity 
to respond to each challenge notice. All parties will be bound by this 
schedule.
    (f) Final decision when Contractor or subcontractor fails to 
respond. Upon a failure of a Contractor or subcontractor to submit any 
response to the challenge notice, other than a failure to respond under 
a contract for commercial items, the Contracting Officer will issue a 
final decision to the Contractor or subcontractor in accordance with the 
Disputes clause of this contract pertaining to the validity of the 
asserted restriction. This final decision shall be issued as soon as 
possible after the expiration of the time period of paragraph (e)(1)(ii) 
or (e)(2) of this clause. Following issuance of the final decision, the 
Contracting Officer will comply with the procedures in paragraphs (g)(2) 
(ii) through (iv) of this clause.
    (g) Final decision when Contractor or subcontractor responds. (1) if 
the Contracting Officer determines that the Contractor or subcontractor 
has justified the validity of the restrictive marking, the Contracting 
Officer shall issue a final decision to the Contractor or subcontractor 
sustaining the validity of the restrictive marking, and stating that the 
Government will continue to be bound by the restrictive marking. This 
final decision shall be issued within sixty (60) days after receipt of 
the Contractor's or subcontractor's response to the challenge notice, or 
within such longer period that the Contracting Officer has notified the 
Contractor or subcontractor that the Government will require. The 
notification of a longer period for issuance of a final decision will be 
made within sixty (60) days after receipt of the response to the 
challenge notice.
    (2)(i) If the Contracting Officer determines that the validity of 
the restrictive marking is not justified, the Contracting Officer shall 
issue a final decision to the Contractor or subcontractor in accordance 
with the Disputes clause of this contract. Notwithstanding paragraph (e) 
of the Disputes clause, the final decision shall be issued within sixty 
(60) days after receipt of the Contractor's or subcontractor's response 
to the challenge notice, or within such longer period that the 
Contracting Officer has notified the Contractor or subcontractor of the 
longer period that the Government will require. The notification of a 
longer period for issuance of a final decision will be made within sixty 
(60) days after receipt of the response to the challenge notice.
    (ii) The Government agrees that it will continue to be bound by the 
restrictive marking of a period of ninety (90) days from the issuance of 
the Contracting Officer's final decision under paragraph (g)(2)(i) of 
this clause. The Contractor or subcontractor agrees that, if it intends 
to file suit in the United States Claims Court it will provide a notice 
of intent to file suit to the Contracting Officer within ninety (90) 
days from the issuance of the Contracting Officer's final decision under 
paragraph (g)(2)(i) of this clause. If the Contractor or subcontractor 
fails to appeal, file suit, or provide a notice of intent to file suit 
to the Contracting Officer within the ninety (90)-day period, the 
Government may cancel or ignore the restrictive markings, and the 
failure of the Contractor or subcontractor to take the required action 
constitutes agreement with such Government action.
    (iii) The Government agrees that it will continue to be bound by the 
restrictive marking where a notice of intent to file suit in the United 
States Claims Court is provided to the Contracting Officer within ninety 
(90) days from the issuance of the final decision under paragraph 
(g)(2)(i) of this clause. The Government will no longer be bound, and 
the Contractor or subcontractor agrees that the Government may strike or 
ignore the restrictive markings, if the Contractor or subcontractor 
fails to file its suit within one (1) year after issuance of the final 
decision. Notwithstanding the foregoing, where the head of an agency 
determines, on a nondelegable basis, that urgent or compelling 
circumstances will not permit waiting for the filing of a suit in the 
United States Claims Court, the Contractor or subcontractor agrees that 
the agency may, following notice to the Contractor or subcontractor, 
authorize release or disclosure of the technical data. Such agency 
determination may be made at any time after issuance of the final 
decision and will not affect the Contractor's or subcontractor's right 
to damages against the United States where its restrictive markings are 
ultimately upheld or to pursue other relief, if any, as may be provided 
by law.
    (iv) The Government agrees that it will be bound by the restrictive 
marking where an appeal or suit is filed pursuant to the Contract 
Disputes Act until final disposition by an agency Board of Contract 
Appeals or the United States Claims Court. Notwithstanding the 
foregoing, where the head of an agency determines, on a nondelegable 
basis, following notice to the Contractor that urgent or compelling 
circumstances will not permit awaiting the decision by such Board of 
Contract Appeals or the United States Claims Court, the Contractor or 
subcontractor

[[Page 494]]

agrees that the agency may authorize release or disclosure of the 
technical data. Such agency determination may be made at any time after 
issuance of the final decision and will not affect the Contractor's or 
subcontractor's right to damages against the United States where its 
restrictive markings are ultimately upheld or to pursue other relief, if 
any, as may be provided by law.
    (h) Final disposition of appeal or suit. (1) If the Contractor or 
subcontractor appeals or files suit and if, upon final disposition of 
the appeal or suit, the Contracting Officer's decision is sustained--
    (i) The restrictive marking on the technical data shall be 
cancelled, corrected or ignored; and
    (ii) If the restrictive marking is found not to be substantially 
justified, the Contractor or subcontractor, as appropriate, shall be 
liable to the Government for payment of the cost to the Government of 
reviewing the restrictive marking and the fees and other expenses (as 
defined in 28 U.S.C. 2412(d)(2)(A)) incurred by the Government in 
challenging the marking, unless special circumstances would make such 
payment unjust.
    (2) If the Contractor or subcontractor appeals or files suit and if, 
upon final disposition of the appeal or suit, the Contracting Officer's 
decision is not sustained--
    (i) The Government shall continue to be bound by the restrictive 
marking; and
    (ii) The Government shall be liable to the Contractor or 
subcontractor for payment of fees and other expenses (as defined in 28 
U.S.C. 2412(d)(2)(A)) incurred by the Contractor or subcontractor in 
defending the marking, if the challenge by the Government is found not 
to have been made in good faith.
    (i) Duration of right to challenge. The Government may review the 
validity of any restriction on technical data, delivered or to be 
delivered under a contract, asserted by the Contractor or subcontractor. 
During the period within three (3) years of final payment on a contract 
or within three (3) years of delivery of the technical data to the 
Government, whichever is later, the Contracting Officer may review and 
make a written determination to challenge the restriction. The 
Government may, however, challenge a restriction on the release, 
disclosure or use of technical data at any time if such technical data--
    (1) Is publicly available;
    (2) Has been furnished to the United States without restriction; or
    (3) Has been otherwise made available without restriction. Only the 
Contracting Officer's final decision resolving a formal challenge by 
sustaining the validity of a restrictive marking constitutes 
``validation'' as addressed in 10 U.S.C. 2321.
    (j) Decision not to challenge. A decision by the Government, or a 
determination by the Contracting Officer, to not challenge the 
restrictive marking or asserted restriction shall not constitute 
``validation.''
    (k) Privity of contract. The Contractor or subcontractor agrees that 
the Contracting Officer may transact matters under this clause directly 
with subcontractors at any tier that assert restrictive markings. 
However, this clause neither creates nor implies privity of contract 
between the Government and subcontractors.
    (l) Flowdown. The Contractor or subcontractor agrees to insert this 
clause in contractual instruments with its subcontractors or suppliers 
at any tier requiring the delivery of technical data, except contractual 
instruments for commercial items or commercial components.

                             (End of clause)

[60 FR 33505, June 28, 1995, as amended at 60 FR 61602, Nov. 30, 1995]



252.227-7038  [Reserved]



252.227-7039  Patents--reporting of subject inventions.

    As prescribed at 227.303(a), insert the following clause:

          Patents--Reporting of Subject Inventions (Apr. 1990)

    The Contractor shall furnish the Contracting Officer the following:
    (a) Interim reports every twelve (12) months (or such longer period 
as may be specified by the Contracting Officer) from the date of the 
contract, listing subject inventions during that period and stating that 
all subject inventions have been disclosed or that there are no such 
inventions.
    (b) A final report, within three (3) months after completion of the 
contracted work, listing all subject inventions or stating that there 
were no such inventions.
    (c) Upon request, the filing date, serial number and title, a copy 
of the patent application and patent number, and issue data for any 
subject invention for which the Contractor has retained title.
    (d) Upon request, the Contractor shall furnish the Government an 
irrevocable power to inspect and make copies of the patent application 
file.

                             (End of clause)



252.228-7000  Reimbursement for war-hazard losses.

    As prescribed in 228.370(a), use the following clause:

             Reimbursement for War-Hazard Losses (Dec. 1991)

    (a) Costs for providing employee war-hazard benefits in accordance 
with paragraph (b)

[[Page 495]]

of the Workers' Compensation and War-Hazard Insurance clause of this 
contract are allowable if the Contractor--
    (1) Submits proof of loss files to support payment or denial of each 
claim;
    (2) Subject to Contracting Officer approval, makes lump sum final 
settlement of any open claims and obtains necessary release documents 
within one year of the expiration or termination of this contract, 
unless otherwise extended by the Contracting Officer; and
    (3) Provides the Contracting Officer at the time of final settlement 
of this contract--
    (i) An investigation report and evaluation of any potential claim; 
and
    (ii) An estimate of the dollar amount involved should the potential 
claim mature.
    (b) The cost of insurance for liabilities reimbursable under this 
clause is not allowable.
    (c) The Contracting Officer may require the Contractor to assign to 
the Government all right, title, and interest to any refund, rebate, or 
recapture arising out of any claim settlements.
    (d) The Contractor agrees to--
    (1) Investigate and promptly notify the Contracting Officer in 
writing of any occurrence which may give rise to a claim or potential 
claim, including the estimated amount of the claim;
    (2) Give the Contracting Officer immediate written notice of any 
suit or action filed which may result in a payment under this clause; 
and
    (3) Provide assistance to the Government in connection with any 
third party suit or claim relating to this clause which the Government 
elects to prosecute or defend in its own behalf.

                             (End of clause)



252.228-7001  Ground and flight risk.

    As prescribed in 228.370(b), use the following clause:

                    Ground and Flight Risk (SEP 1996)

    (a) Definitions. As used in this clause--
    (1) Aircraft, unless otherwise provided in the Schedule, means--
    (i) Aircraft to be delivered to the Government under this contract 
(either before or after Government acceptance), including complete 
aircraft and aircraft in the process of being manufactured, 
disassembled, or reassembled; provided that an engine, portion of a wing 
or a wing is attached to a fuselage of the aircraft; and
    (ii) Aircraft, whether in a state of disassembly or reassembly, 
furnished by the Government to the Contractor under this contract, 
including all property installed, in the process of installation, or 
temporarily removed; provided that the aircraft and property are not 
covered by a separate bailment agreement.
    (2) Contractor's premises means those premises designated in the 
Schedule or in writing by the Contracting Officer, and any other place 
the aircraft is moved for safeguarding.
    (3) Flight means any flight demonstration, flight test, taxi test, 
or other flight made in the performance of this contract, or for the 
purpose of safeguarding the aircraft, or previously approved in writing 
by the Contracting Officer.
    (i) For land based aircraft, flight begins with the taxi roll from a 
flight line on the Contractor's premises and continues until the 
aircraft has completed the taxi roll in returning to a flight line on 
the Contractor's premises;
    (ii) For seaplanes, flight begins with the launching from a ramp on 
the Contractor's premises and continues until the aircraft has completed 
its landing run and is beached at a ramp on the Contractor's premises;
    (iii) For helicopters, flight begins upon engagement of the rotors 
for the purpose of take-off from the Contractor's premises and continues 
until the aircraft has returned to the ground on the Contractor's 
premises and the rotors are disengaged; and
    (iv) For vertical take-off aircraft, flight begins upon 
disengagement from any launching platform or device on the Contractor's 
premises and continues until the aircraft has been engaged to any 
launching platform or device on the Contractor's premises;
    (v) All aircraft off the Contractor's premises shall be considered 
to be in flight when on the ground or water for reasonable periods of 
time following emergency landings, landings made in performance of this 
contract, or landings approved in writing by the Contracting Officer.
    (4) Flight crew member means the pilot, the co-pilot, and, unless 
otherwise provided in the Schedule, the flight engineer, navigator, and 
bombardier-navigator when assigned to their respective crew positions 
for the purpose of conducting any flight on behalf of the Contractor. If 
required, a defense systems operator may also be assigned as a flight 
crew member.
    (5) In the open means located wholly outside of buildings on the 
Contractor's premises or other places described in the Schedule as being 
in the open. Government furnished aircraft shall be considered to be 
located in the open at all times while in the Contractor's possession, 
care, custody, or control.
    (6) Operation means operations and tests of the aircraft and its 
installed equipment, accessories, and power plants, while the aircraft 
is in the open or in motion. The term does not apply to aircraft on any 
production line or in flight.
    (b) Except as may be specifically provided in the Schedule as an 
exception to this clause, the Government assumes the risk of

[[Page 496]]

damage to, or loss or destruction of aircraft in the open, during 
operation, and in flight. The Contractor shall not be liable to the 
Government for such damage, loss, or destruction.
    (c) The Government's assumption of risk for aircraft in the open 
shall continue unless the Contracting Officer finds that the aircraft is 
in the open under unreasonable conditions, and the Contractor fails to 
take prompt corrective action.
    (1) The Contracting Officer, when finding aircraft in the open under 
unreasonable conditions, shall notify the Contractor in writing of the 
unreasonable conditions and require the Contractor to make corrections 
within a reasonable time.
    (2) Upon receipt of the notice, the Contractor shall promptly 
correct the cited conditions, regardless of whether there is agreement 
that the conditions are unreasonable. If the Contracting Officer later 
determines that the cited conditions were not unreasonable, an equitable 
adjustment shall be made in the contract price for any additional costs 
incurred in correcting the conditions. Any dispute as to the 
unreasonableness of the conditions or the equitable adjustment shall be 
considered a dispute under the Disputes clause of this contract.
    (3) If the Contracting Officer finds that the Contractor failed to 
act promptly to correct the cited conditions or failed to correct the 
conditions within a reasonable time, the Contracting Officer may 
terminate the Government's assumption of risk for any aircraft in the 
open under the cited conditions. The termination will be effective at 
12:01 am on the fifteenth day following the day the written notice is 
received by the Contractor. If the Contracting Officer later determines 
that the Contractor acted promptly to correct the cited conditions or 
that the time taken by the Contractor was not unreasonable, an equitable 
adjustment shall be made in the contract price for any additional costs 
incurred as a result of termination of the Government's assumption of 
risk. Any dispute as to the timeliness of the Contractor's action or the 
equitable adjustment shall be considered a dispute under the Disputes 
clause of this contract.
    (4) If the Government terminates its assumption of risk, the risk of 
loss for Government-furnished property shall be determined in accordance 
with the Government Property clause of this contract.
    (5) The Contractor shall promptly notify the Contracting Officer 
when unreasonable conditions have been corrected. If the Government 
elects to again assume the risk of loss and relieve the Contractor of 
liabilities, the Contracting Officer will notify the Contractor. The 
Contractor shall be entitled to an equitable adjustment in the contract 
price for any insurance costs extending from the end of the third 
working day after the Contractor notice of correction until the 
Contractor is notified that the Government will assume the risk of loss. 
If the Government does not again assume the risk of loss and conditions 
have been corrected, the Contractor shall be entitled to an equitable 
adjustment for insurance costs, if any, extending after the third 
working day.
    (d) The Government's assumption of risk shall not extend to damage, 
loss, or destruction of aircraft which--
    (1) Results from failure of the Contractor, due to willful 
misconduct or lack of good faith of any of the Contractor's managerial 
personnel, to maintain and administer a program for the protection and 
preservation of aircraft in the open and during operation in accordance 
with sound industrial practice. The term Contractor's managerial 
personnel means the Contractor's directors, officers, and any of the 
Contractor's managers, superintendents, or other equivalent 
representatives who supervise or direct all or substantially all of the 
Contractor's business; or all or substantially all of the Contractor's 
operations at any one plant or separate location at which this contract 
is performed; or a separate and complete major industrial operation in 
connection with the performance of this contract;
    (2) Is sustained during flight if the flight crew members have not 
been approved in writing by the Government Flight Representative, who 
has been authorized in accordance with the combined regulation entitled 
``Contractor's Flight and Ground Operations'' (Air Force Regulation 55-
22, Army Regulation 95-20, NAVAIR Instruction 3710.1C, and Defense 
Logistics Agency Manual 8210.1);
    (3) Occurs in the course of transportation by rail, or by conveyance 
on public streets, highways, or waterways, except for Government-
furnished property;
    (4) Is covered by insurance;
    (5) Consists of wear and tear; deterioration (including rust and 
corrosion); freezing; or mechanical, structural, or electrical breakdown 
or failure, unless these are the result of other loss, damage or 
destruction covered by this clause. (This exclusion does not apply to 
Government-furnished property if damage consists of reasonable wear and 
tear or deterioration, or results from inherent vice in the property.); 
or
    (6) Is sustained while the aircraft is being worked on and is a 
direct result of the work unless such damage, loss, or destruction would 
be covered by insurance which would have been maintained by the 
Contractor, but for the Government's assumption of risk.
    (e) With the exception of damage, loss, or destruction in flight, 
the Contractor assumes the risk and shall be responsible for the first 
$25,000 of loss or damage to aircraft in the open or during operation 
resulting from each separate event, except for reasonable wear

[[Page 497]]

and tear and to the extent the loss or damage is caused by negligence of 
Government personnel. If the Government elects to require that the 
aircraft be replaced or restored by the Contractor to its condition 
immediately prior to the damage, the equitable adjustment in the price 
authorized by paragraph (i) of this clause shall not include the dollar 
amount of the risk assumed by the Contractor. In the event the 
Government does not elect repair or replacement, the Contractor agrees 
to credit the contract price or pay the Government $25,000 (or the 
amount of the loss, if less) as directed by the Contracting Officer.
    (f) A subcontractor shall not be relieved from liability for damage, 
loss, or destruction of aircraft while in its possession or control, 
except to the extent that the subcontract, with the written approval of 
the Contracting Officer, provides for relief from each liability. In the 
absence of approval, the subcontract shall contain provisions requiring 
the return of aircraft in as good condition as when received, except for 
reasonable wear and tear or for the utilization of the property in 
accordance with the provisions of this contract. Where a subcontractor 
has not been relieved from liability, and damage, loss, or destruction 
occurs, the Contractor shall enforce liability against the subcontractor 
for the benefit of the Government.
    (g) The Contractor warrants that the contract price does not and 
will not include, except as may be authorized in this clause, any charge 
or contingency reserve for insurance covering damage, loss, or 
destruction of aircraft while in the open, during operation, or in 
flight when the risk has been assumed by the Government, even if the 
assumption may be terminated for aircraft in the open.
    (h) In the event of damage, loss, or destruction of aircraft in the 
open, during operation, or in flight, the Contractor shall take all 
reasonable steps to protect the aircraft from further damage, to 
separate damaged and undamaged aircraft, to put all aircraft in the best 
possible order and further, except in cases covered by paragraph (e) of 
this clause, the Contractor shall furnish to the Contracting Officer a 
statement of--
    (1) The damaged, lost, or destroyed aircraft;
    (2) The time and origin of the damage, loss, or destruction;
    (3) All known interests in commingled property of which aircraft are 
a part; and
    (4) The insurance, if any, covering the interest in commingled 
property.
    Except in cases covered by paragraph (e) of this clause, the 
Contracting Officer will make an equitable adjustment in the contract 
price for expenditures made by the Contractor in performing the 
obligations under this paragraph.
    (i) If prior to delivery and acceptance by the Government, aircraft 
is damaged, lost, or destroyed and the Government assumed the risk, the 
Government shall either--
    (1) Require that the aircraft be replaced or restored by the 
Contractor to the condition immediately prior to the damage, in which 
event the Contracting Officer will make an equitable adjustment in the 
contract price and the time for contract performance; or
    (2) Terminate this contract with respect to the aircraft, in which 
event the Contractor shall be paid the contract price for the aircraft 
(or, if applicable, any work to be performed on the aircraft) less any 
amount the Contracting Officer determines--
    (i) It would have cost the Contractor to complete the aircraft (or 
any work to be performed on the aircraft) together with anticipated 
profit on uncompleted work; and
    (ii) Would be the value of the damaged aircraft or any salvage 
retained by the Contractor.
    The Contracting Officer shall prescribe the manner of disposition of 
the damaged, lost, or destroyed aircraft, or any parts of the aircraft. 
If any additional costs of such disposition are incurred by the 
Contractor, a further equitable adjustment will be made in the amount 
due the Contractor. Failure of the parties to agree upon termination 
costs or an equitable adjustment with respect to any aircraft shall be 
considered a dispute under the Disputes clause.
    (j) In the event the Contractor is reimbursed or compensated by a 
third person for damage, loss, or destruction of aircraft and has also 
been compensated by the Government, the Contractor shall equitably 
reimburse the Government. The Contractor shall do nothing to prejudice 
the Government's right to recover against third parties for damage, 
loss, or destruction. Upon the request of the Contracting Officer or 
authorized representative, the Contractor shall at Government expense 
furnish to the Government all reasonable assistance and cooperation 
(including the prosecution of suit and the execution of instruments of 
assignment of subrogation) in obtaining recovery.
    (k) The Contractor agrees to be bound by the operating procedures 
contained in the combined regulation entitled ``Contractor's Flight and 
Ground Operations'' in effect on the date of contract award.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 56 FR 67221, Dec. 30, 1991; 
61 FR 50456, Sept. 26, 1996]



252.228-7002  Aircraft flight risk.

    As prescribed in 228.370(c), use the following clause:

[[Page 498]]

                     Aircraft Flight Risk (SEP 1996)

    (a) Definitions. As used in this clause--
    (1) Aircraft, unless otherwise provided in the Schedule, means--
    (i) Aircraft furnished by the Contractor under this contract (either 
before or after Government acceptance); or
    (ii) Aircraft furnished by the Government to the Contractor, 
including all Government property placed on, installed or attached to 
the aircraft; provided that the aircraft and property are not covered by 
a separate bailment agreement.
    (2) Flight means any flight demonstration, flight test, taxi test, 
or other flight made in the performance of this contract, or for the 
purpose of safeguarding the aircraft, or previously approved in writing 
by the Contracting Officer.
    (i) For land-based aircraft, flight begins with the taxi roll from a 
flight line and continues until the aircraft has completed the taxi roll 
to a flight line.
    (ii) For seaplanes, flight begins with the launching from a ramp and 
continues until the aircraft has completed its landing run and is 
beached at a ramp.
    (iii) For helicopters, flight begins upon engagement of the rotors 
for the purpose of take-off and continues until the aircraft has 
returned to the ground and rotors are disengaged.
    (iv) For vertical take-off aircraft, flight begins upon 
disengagement from any launching platform or device and continues until 
the aircraft has been reengaged to any launching platform or device.
    (3) Flight crew members means the pilot, co-pilot, and unless 
otherwise provided in the Schedule, the flight engineer, navigator, 
bombardier-navigator, and defense systems operator as required, when 
assigned to their respective crew positions to conduct any flight on 
behalf of the Contractor.
    (b) This clause takes precedence over any other provision of this 
contract (particularly paragraph (g) of the Government Property (Cost-
Reimbursement, Time-and-Materials, or Labor-Hour Contracts) clause and 
paragraph (c) of the Insurance--Liability to Third Persons clause).
    (c) Unless the flight crew members previously have been approved in 
writing by the Government Flight Representative, who has been authorized 
in accordance with the combined regulation entitled ``Contractor's 
Flight and Ground Operations'' (Air Force Regulation 55-22, Army 
Regulation 95-20, NAVAIR Instruction 3710.1C, and Defense Logistics 
Agency Manual 8210.1), the Contractor shall not be--
    (1) Relieved of liability for damage, loss, or destruction of 
aircraft sustained during flight; or
    (2) Reimbursed for liabilities to third persons for loss or damage 
to property or for death or bodily injury caused by aircraft during 
flight.
    (d)(1) The loss, damage, or destruction of aircraft during flight in 
an amount exceeding $100,000 or 20 percent of the estimated cost of this 
contract, whichever is less, is subject to an equitable adjustment when 
the Contractor is not liable under--
    (i) The Government Property (Cost-Reimbursement, Time-and-Materials, 
or Labor-Hour Contracts) clause, and
    (ii) Paragraph (c) of this clause.
    (2) The equitable adjustment under this contract for the resulting 
repair, restoration, or replacement of aircraft shall be made--
    (i) In the estimated cost, the delivery schedule, or both; and
    (ii) In the amount of any fee to be paid to the Contractor.
    (3) In determining the amount of equitable adjustment in the fee, 
the Contracting Officer will consider any fault of the Contractor, its 
employees, or any subcontractor that materially contributed to the 
damage, loss, or destruction.
    (4) Failure to agree on any adjustment shall be a dispute concerning 
a question of fact within the meaning of the Disputes clause of this 
contract.
    (e) The Contractor agrees to be bound by the operating procedures 
contained in the combined regulation entitled ``Contractor's Flight and 
Found Operations'' in effect on the date of contract award.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 61 FR 50456, Sept. 26, 1996]



252.228-7003  Capture and detention.

    As prescribed in 228.370(d), use the following clause:

                    Capture and Detention (Dec. 1991)

    (a) As used in this clause--

    (1) Captured person means any employee of the Contractor who is--
    (i) Assigned to duty outside the United States for the performance 
of this contract; and
    (ii) Found to be missing from his or her place of employment under 
circumstances that make it appear probable that the absence is due to 
the action of the force of any power not allied with the United States 
in a common military effort; or
    (iii) Known to have been taken prisoner, hostage, or otherwise 
detained by the force of such power, whether or not actually engaged in 
employment at the time of capture; provided, that at the time of capture 
or detention, the person was either--

[[Page 499]]

    (A) Engaged in activity directly arising out of and in the course of 
employment under this contract; or
    (B) Captured in an area where required to be only in order to 
perform this contract.
    (2) A period of detention begins with the day of capture and 
continues until the captured person is returned to the place of 
employment, the United States, or is able to be returned to the 
jurisdiction of the United States, or until the person's death is 
established or legally presumed to have occurred by evidence 
satisfactory to the Contracting Officer, whichever occurs first.
    (3) United States comprises geographically the 50 states and the 
District of Columbia.
    (4) War Hazards Compensation Act refers to the statute compiled in 
chapter 12 of title 42, U.S. Code (sections 1701-1717), as amended.
    (b) If pursuant to an agreement entered into prior to capture, the 
Contractor is obligated to pay and has paid detention benefits to a 
captured person, or the person's dependents, the Government will 
reimburse the Contractor up to an amount equal to the lesser of--
    (1) Total wage or salary being paid at the time of capture due from 
the Contractor to the captured person for the period of detention; or
    (2) That amount which would have been payable if the detention had 
occurred under circumstances covered by the War Hazards Compensation 
Act.
    (c) The period of detention shall not be considered as time spent in 
contract performance, and the Government shall not be obligated to make 
payment for that time except as provided in this clause.
    (d) The obligation of the Government shall apply to the entire 
period of detention, except that it is subject to the availability of 
funds from which payment can be made. The rights and obligations of the 
parties under this clause shall survive prior expiration, completion, or 
termination of this contract.
    (e) The Contractor shall not be reimbursed under this clause for 
payments made if the employees were entitled to compensation for capture 
and detention under the War Hazards Compensation Act, as amended.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 57 FR 42633, Sept. 15, 1992



252.228-7004  Bonds or other security.

    As prescribed in 228.170, use the following provision:

                   Bonds or Other Security (Dec. 1991)

    (a) Offerors shall furnish a bid guarantee in the amount of 
$________ with their bids. The offeror receiving notice of award shall 
furnish--
    (1) A performance bond in the penal amount of $________; and
    (2) Payment in full of any sum due the Government.
    (b) The Contractor shall furnish the performance bond to the 
Contracting Officer within ____ days after receipt of the notice of 
award. The Contracting Officer will not issue the notice to proceed 
until receipt of an acceptable performance bond and payment of any sum 
due the Government.
    (c) Bonds supported by sureties whose names appear on the list 
contained in Treasury Department Circular 570 are acceptable. 
Performance bonds from individual sureties are acceptable if each person 
acting as a surety provides a SF 28, Affidavit of Individual Surety, and 
a pledge of assets acceptable to the Contracting Officer.

                           (End of provision)



252.228-7005  Accident reporting and investigation involving aircraft, missiles, and space launch vehicles.

    As prescribed in 228.370(e), use the following clause:

 Accident Reporting and Investigation Involving Aircraft, Missiles, and 
                    Space Launch Vehicles (Dec. 1991)

    (a) The Contractor shall report promptly to the Administrative 
Contracting Officer all pertinent facts relating to each accident 
involving an aircraft, missile, or space launch vehicle being 
manufactured, modified, repaired, or overhauled in connection with this 
contract.
    (b) If the Government conducts an investigation of the accident, the 
Contractor will cooperate and assist the Government's personnel until 
the investigation is complete.
    (c) The Contractor will include a clause in subcontracts under this 
contract to require subcontractor cooperation and assistance in accident 
investigations.

                             (End of clause)



252.228-7006  Compliance with Spanish laws and insurance.

    As prescribed at 228.370(f), use the following clause:

         Compliance with Spanish Laws and Insurance (JUNE 1997)

    (a) The Contractor shall, without additional expense to the United 
States Government, comply with all applicable Spanish Government laws 
pertaining to sanitation, traffic, security, employment of labor, and 
all other laws relevant to the performance of this contract. The 
Contractor shall hold the United States Government harmless and free

[[Page 500]]

from any liability resulting from the Contractor's failure to comply 
with such laws.
    (b) The contractor shall, at its own expense, provide and maintain 
during the entire performance of this contract, all workmen's 
compensation, employees' liability, bodily injury insurance, and other 
required insurance adequate to cover the risk assumed by the Contractor. 
The Contractor shall indemnify and hold harmless the United States 
Government from liability resulting from all claims for damages as a 
result of death or injury to personnel or damage to real or personal 
property related to the performance of this contract.
    (c) The Contractor agrees to represent in writing to the Contracting 
Officer, prior to commencement of work and not later than 15 days after 
the date of the Notice to Proceed, that the Contractor has obtained the 
required types of insurance in the following minimum amounts. The 
representation also shall state that the Contractor will promptly notify 
the Contracting Officer of any notice of cancellation of insurance or 
material change in insurance coverage that could affect the United 
States Government's interests.

                                                                        
------------------------------------------------------------------------
                                                  Coverage              
        Type of insurance            Coverage       per        Property 
                                    per person    accident      damage  
------------------------------------------------------------------------
Comprehensive General Liability..     $300,000   $1,000,000     $100,000
------------------------------------------------------------------------

    (d) The Contractor shall provide the Contracting Officer with a 
similar representation for all subcontractors that will perform work 
under this contract.
    (e) Insurance policies required herein shall be purchased from 
Spanish insurance companies or other insurance companies legally 
authorized to conduct business in Spain. Such policies shall conform to 
Spanish laws and regulations and shall--
    (1) Contain provisions requiring submission to Spanish law and 
jurisdiction of any problem that may arise with regard to the 
interpretation or application of the clauses and conditions of the 
insurance policy;
    (2) Contain a provision authorizing the insurance company, as 
subrogee of the insured entity, to assume and attend to directly, with 
respect to any person damaged, the legal consequences arising from the 
occurrence of such damages;
    (3) Contain a provision worded as follows: ``The insurance company 
waives any right of subrogation against the United States of America 
that may arise by reason of any payment under this policy.'';
    (4) Not contain any deductible amount or similar limitation; and
    (5) Not contain any provisions requiring submission to any type of 
arbitration.

                             (End of clause)

[62 FR 34132, June 24, 1997]



252.229-7000  Invoices exclusive of taxes or duties.

    As prescribed in 229.402-1, use the following clause:

            Invoices Exclusive of Taxes or Duties (JUNE 1997)

    Invoices submitted in accordance with the terms and conditions of 
this contract shall be exclusive of all taxes or duties for which relief 
is available.

                             (End of clause)

[62 FR 34132, June 24, 1997]



252.229-7001  Tax relief.

    As prescribed in 229.402-70(a), use the following clause:

                         Tax Relief (JUNE 1997)

    (a) Prices set forth in this contract are exclusive of all taxes and 
duties from which the United States Government is exempt by virtue of 
tax agreements between the United States Government and the Contractor's 
government. The following taxes or duties have been excluded from the 
contract price:

    NAME OF TAX: (Offeror Insert) RATE (PERCENTAGE): (Offeror Insert)

    (b) The Contractor's invoice shall list separately the gross price, 
amount of tax deducted, and net price charged.
    (c) When items manufactured to United States Government 
specifications are being acquired, the Contractor shall identify the 
materials or components intended to be imported in order to ensure that 
relief from import duties is obtained. If the Contractor intends to use 
imported products from inventories on hand, the price of which includes 
a factor for import duties, the Contractor shall ensure the United 
States Government's exemption from these taxes. The Contractor may 
obtain a refund of the import duties from its government or request the 
duty-free import of an amount of supplies or components corresponding to 
that used from inventory for this contract.

                             (End of clause)

                         ALTERNATE I (JUNE 1997)

    As prescribed in 229.402-70(a), add the following paragraph (d) to 
the basic clause:
    (d) Tax relief will be claimed in Germany pursuant to the provisions 
of the Agreement Between the United States of America and

[[Page 501]]

Germany Concerning Tax Relief to be Accorded by Germany to United States 
Expenditures in the Interest of Common Defense. The Contractor shall use 
Abwicklungsschein fuer abgabenbeguenstigte Lieferungen/Leistungen nach 
dem Offshore Steuerabkommen (Performance Certificate for Tax-Free 
Deliveries/Performance according to the Offshore Tax Relief Agreement) 
or other documentary evidence acceptable to the German tax authorities. 
All purchases made and paid for on a tax-free basis during a 30-day 
period may be accumulated, totaled, and reported as tax-free.
[62 FR 34132, June 24, 1997]



252.229-7002  Customs exemptions (Germany).

    As prescribed in 229.402-70(b), use the following clause:

                Customs Exemptions (Germany) (JUNE 1997)

    Imported products required for the direct benefit of the United 
States Forces are authorized to be acquired duty-free by the Contractor 
in accordance with the provisions of the Agreement Between the United 
States of America and Germany Concerning Tax Relief to be Accorded by 
Germany to United States Expenditures in the Interest of Common Defense.

                             (End of clause)

[62 FR 34133, June 24, 1997]



252.229-7003  Tax exemptions (Italy).

    As prescribed in 229.402-70(c), use the following clause:

                   Tax Exemptions (Italy) (JUNE 1997)

    (a) The Contractor represents that the contract prices, including 
the prices in subcontracts awarded hereunder, do not include taxes from 
which the United States Government is exempt.
    (b) The United States Government is exempt from payment of Imposta 
Valore Aggiunto (IVA) tax in accordance with Article 72 of the IVA 
implementing decree on all supplies and services sold to United States 
Military Commands in Italy.
    (1) Upon receipt of the invoice, the paying office will stamp the 
following statement on one copy of the invoice:
    ``I certify that this invoice is true and correct and reflects 
expenditures made in Italy for the Common Defense by the United States 
Government pursuant to international agreements. The amount to be paid 
does not include the IVA tax, because this transaction is not subject to 
the tax in accordance with Article 72 of Decree Law 633, dated October 
26, 1972.''
    (2) This certified copy, signed by an authorized Government 
official, will be returned together with payment to the Contractor. The 
payment will not include the amount of IVA tax.
    (3) The Contractor must retain this copy of the invoice with the 
representation to substantiate non-payment of the IVA tax.
    (c) In addition to the IVA tax, purchases by the United States 
Forces in Italy are exempt from the following taxes:
    (1) Imposta di Fabbricazione (Production Tax for Petroleum 
Products).
    (2) Imposta di Consumo (Consumption Tax for Electrical Power).
    (3) Dazi Doganali (Customs Duties).
    (4) Tassa di Sbarco e d'Imbarco sulle Merci Transportate per Via 
Aerea e per Via Maritima (Port Fees).
    (5) Tassa de Circolazione sui Veicoli (Vehicle Circulation Tax).
    (6) Imposta di Registro (Registration Tax).
    (7) Imposta di Bollo (Stamp Tax).
    (d) The Contractor's administrative procedures for claiming and 
validating the exemptions are as follows:
    (1) Contract offer price shall not reflect IVA or any other tax or 
duty.
    (2) Contract number must be set forth on Contractor invoices, which 
should state the exemptions claimed pursuant to Article 72 of Decree Law 
633, dated October 26, 1972, for IVA exemption.
    (3) Fiscal code for appropriated funds payments by Aviano Air Base 
is: 91000190933.
    (4) Questions may be addressed to the Ministry of Finance, 11th 
District, Rome (06) 5910982.

                             (End of clause)

[62 FR 34133, June 24, 1997; 62 FR 49305, Sept. 19, 1997]



252.229-7004  Status of contractors as a direct contractor (Spain).

    As prescribed in 229.402-70(d), use the following clause:

     Status of Contractor as a Director Contract (Spain) (June 1997)

    (a) ``Direct Contractor,'' as used in this clause, means an 
individual, company, or entity with whom an agency of the United States 
Department of Defense has executed a written agreement that allows duty-
free import of equipment, materials, and supplies into Spain for the 
construction, development, maintenance, and operation of Spanish-
American installations and facilities.
    (b) The Contractor is hereby designated as a Direct Contractor under 
the provisions of Complementary Agreement 5, articles 11, 14, 15, 17, 
and 18 of the Agreement on Friendship, Defense and Cooperation between 
the United States Government and the Kingdom

[[Page 502]]

of Spain, dated July 2, 1982. The Agreement relates to contacts to be 
performed in whole or part in Spain, the provisions of which are hereby 
incorporated into and made a part of this contract by reference.
    (c) The Contractor shall apply to the appropriate Spanish 
authorities for approval of status as a Direct Contractor in order to 
complete duty-free import of non-Spanish equipment, materials, and 
supplies represented as necessary for contract performance by the 
Contracting Officer. Orders for equipment, materials, and supplies 
placed prior to official notification of such approval shall be at the 
Contractor's own risk. The Contractor must submit its documentation in 
sufficient time to permit processing by the appropriate United States 
and Spanish Government agencies prior to the arrival of the equipment, 
material, or supplies in Spain. Seasonal variations in processing times 
are common, and the Contractor should program its projects accordingly. 
Any delay or expense arising directly or indirectly from this process 
shall not excuse untimely performance (except as expressly allowed in 
other provisions of this contract), constitute a direct or constructive 
change, or otherwise provide a basis for additional compensation or 
adjustment of any kind.
    (d) To ensure that all duty-free imports are properly accounted for, 
exported, or disposed of, in accordance with Spanish law, the Contractor 
shall obtain a written bank letter of guaranty payable to the Treasurer 
of the United States, or such other authority as may be designated by 
the Contracting Officer, in the amount set forth in paragraph (g) of 
this clause, prior to effecting any duty-free imports for the 
performance of this contract.
    (e) If the Contractor fails to obtain the required guaranty, the 
Contractor agrees that the Contracting Officer may withhold a portion of 
the contract payments in order to establish a fund in the amount set 
forth in paragraph (g) of this clause. The fund shall be used for the 
payment of import taxes in the event that the Contractor fails to 
properly account for, export, or dispose of equipment, materials, or 
supplies imported on a duty-free basis.
    (f) The amount of the bank letter of guaranty or size of the fund 
required under paragraph (d) or (e) of this clause normally shall be 5 
percent of the contract value. However, if the Contractor demonstrates 
to the Contracting Officer's satisfaction that the amount retained by 
the United States Government or guaranteed by the bank is excessive, the 
amount shall be reduced to an amount commensurate with contingent import 
tax and duty-free liability. This bank guaranty or fund shall not be 
released to the Contractor until the Spanish General Directorate of 
Customs verifies the accounting, export, or disposition of the 
equipment, material, or supplies imported on a duty-free basis.
    (g) The amount required under paragraph (d), (e), or (f) of this 
clause is (Contracting Officer insert amount at time of contract award).
    (h) The Contractor agrees to insert the provisions of this clause, 
including this paragraph (h), in all subcontracts.

                             (End of clause)

[62 FR 34133, June 24, 1997]



252.229-7005  Tax exemptions (Spain).

    As prescribed in 229.402-70(e), use the following clause:

                   Tax Exemptions (Spain) (June 1997)

    (a) The Contractor represents that the contract prices, including 
subcontract prices, do not include the taxes identified herein, or any 
other taxes from which the United States Government is exempt.
    (b) In accordance with tax relief agreements between the United 
States Government and the Spanish Government, and because the incumbent 
contract arises from the activities of the United States Forces in 
Spain, the contract will be exempt from the following excise, luxury, 
and transaction taxes:
    (1) Derechos de Aduana (Customs Duties).
    (2) Impuesto de Compensacion a la Importacion (Compensation Tax on 
Imports).
    (3) Transmissiones Patrionomiales (Property Transfer Tax).
    (4) Impuesto Sobre el Lujo (Luxury Tax).
    (5) Actos Juridocos Documentados (Legal Official Transactions).
    (6) Impuesto Sobre el Trafico de Empresas (Business Trade Tax).
    (7) Impuestos Especiales de Fabricacion (Special Products Tax).
    (8) Impuesto Sobre el Petroleo y Derivados (Tax on Petroleum and its 
By-Products).
    (9) Impuesto Sobre el Uso de Telefona (Telephone Tax).
    (10) Impuesto General Sobre la Renta de Sociedades y demas Entidades 
Juridicas (General Corporation Income Tax).
    (11) Impuesto Industrial (Industrial Tax).
    (12) Impuesto de Rentas Sobre el Capital (Capital Gains Tax).
    (13) Plus Vailia (Increase on Real Property).
    (14) Contribucion Territorial Urbana (Metropolitan Real Estate Tax).
    (15) Contribucion Territorial Rustica y Pecuaria (Farmland Real 
Estate Tax).
    (16) Impuestos de la Diputacion (County Service Charges).
    (17) Impuestos Municipal y Tasas Parafiscales (Municipal Tax and 
Charges).

[[Page 503]]

                             (End of clause)

[62 FR 34133, June 24, 1997]



252.229-7006  Value added tax exclusion (United Kingdom).

    As prescribed in 229.402-70(f), use the following clause:

         Value Added Tax Exclusion (United Kingdom) (JUNE 1997)

    The supplies or services identified in this contract are to be 
delivered at a price exclusive of value added tax under arrangements 
between the appropriate United States authorities and Her Majesty's 
Customs and Excise (Reference Priv 46/7). By executing this contract, 
the Contracting Officer certifies that these supplies or services are 
being purchased for United States Government official purposes only.

                             (End of clause)

[62 FR 34134, June 24, 1997]



252.229-7007  Verification of United States receipt of goods.

    As prescribed in 229.402-70(g), use the following clause:

       Verification of United States Receipt of Goods (JUNE 1997)

    The Contractor shall insert the following statement on all Material 
Inspection and Receiving Reports (DD Form 250 series) for Contracting 
Officer approval: ``I certify that the items listed on this invoice have 
been received by the United States.''

                             (End of clause)

[62 FR 34134, June 24, 1997]



252.229-7008  Relief from import duty (United Kingdom).

    As prescribed in 229.402-70(h), use the following clause:

          Relief from Import Duty (United Kingdom) (JUNE 1997)

    Any import dutiable articles, components, or raw materials supplied 
to the United States Government under this contract shall be exclusive 
of any United Kingdom import duties. Any imported items supplied for 
which import duty already has been paid will be supplied at a price 
exclusive of the amount of import duty paid. The Contractor is advised 
to contact Her Majesty's (HM) Customs and Excise to obtain a refund upon 
completion of the contract (Reference HM Customs and Excise Notice No. 
431, February 1973, entitled ``Relief from Customs Duty and/or Value 
Added Tax on United States Government Expenditures in the United 
Kingdom'').

                             (End of clause)

[62 FR 34134, June 24, 1997]



252.229-7009  Relief from customs duty and value added tax on fuel (passenger vehicles) (United Kingdom).

    As prescribed in 229.402-70(i), use the following clause:

    Relief from Customs Duty and Value Added Tax on Fuel (Passenger 
                 Vehicles) (United Kingdom) (JUNE 1997)

    (a) Pursuant to an agreement between the United States Government 
and Her Majesty's (HM) Customs and Excise, fuels and lubricants used by 
passenger vehicles (except taxis) in the performance of this contract 
will be exempt from customs duty and value added tax. Therefore, the 
procedures outlined in HM Customs and Excise Notice No. 431B, August 
1982, and any amendment thereto, shall be used to obtain relief from 
both customs duty and value added tax for fuel used under the contract. 
These procedures shall apply to both loaded and unloaded miles. The unit 
prices shall be based on the recoupment by the Contractor of customs 
duty in accordance with the following allowances:
    (1) Vehicles (except taxis) with a seating capacity of less than 29, 
one gallon for every 27 miles.
    (2) Vehicles with a seating capacity of 29-53, one gallon for every 
13 miles.
    (3) Vehicles with a seating capacity of 54 or more, one gallon for 
every 10 miles.
    (b) In the event the mileage of any route is increased or decreased 
within 10 percent, resulting in no change in route price, the customs 
duty shall be reclaimed from HM Customs and Excise on actual mileage 
performed.

                             (End of clause)

[62 FR 34134, June 24, 1997]



252.229-7010  Relief from customs duty on fuel (United Kingdom).

    As prescribed in 229.402-70(j), use the following clause:

      Relief from Customs Duty on Fuel (United Kingdom) (JUNE 1997)

    (a) Pursuant to an agreement between the United States Government 
and Her Majesty's (HM) Customs and Excise, it is possible to obtain 
relief from customs duty on

[[Page 504]]

fuels and lubricants used in support of certain contracts. If vehicle 
fuels and lubricants are used in support of this contract, the 
Contractor shall seek relief from customs duty in accordance with HM 
Customs Notice No. 431, February 1973, entitled ``Relief from Customs 
Duty and/or Value Added Tax on United States Government Expenditures in 
the United Kingdom.'' Application should be sent to the Contractor's 
local Customs and Excise Office.
    (b) Specific information should be included in the request for tax 
relief, such as the number of vehicles involved, types of vehicles, 
rating of vehicles, fuel consumption, estimated mileage per contract 
period, and any other information that will assist HM Customs and Excise 
in determining the amount of relief to be granted.
    (c) Within 30 days after the award of this contract, the Contractor 
shall provide the Contracting Officer with evidence that an attempt to 
obtain such relief has been initiated. In the event the Contractor does 
not attempt to obtain relief within the time specified, the Contracting 
Officer may deduct from the contract price the amount of relief that 
would have been allowed if HM Customs and Excise had favorably 
considered the request for relief.
    (d) The amount of any rebate granted by HM Customs and Excise shall 
be paid in full to the United States Government. Checks shall be made 
payable to the Treasurer of the United States and forwarded to the 
Administrative Contracting Officer.

                             (End of clause)

[62 FR 34134, June 24, 1997]



252.231-7000  Supplemental cost principles.

    As prescribed in 231.100-70, use the following clause:

                Supplemental Cost Principles (Dec. 1991)

    When the allowability of costs under this contract is determined in 
accordance with part 31 of the Federal Acquisition Regulation (FAR), 
allowability shall also be determined in accordance with part 231 of the 
Defense FAR Supplement, in effect on the date of this contract.

                             (End of clause)



252.232-7000  Advance payment pool.

    As prescribed in 232.412-70(a), use the following clause:

                    Advance Payment Pool (Dec. 1991)

    (a) Notwithstanding any other provision of this contract, advance 
payments will be made for contract performance in accordance with the 
Determinations, Findings, and Authorization for Advance payment dated 
______________.
    (b) Payments made in accordance with this clause shall be governed 
by the terms and conditions of the Advance Payment Pool Agreement 
between the United States of America and (insert the name of the 
contractor). The Agreement is incorporated in the contract by reference.

                             (End of clause)



252.232-7001  Disposition of payments.

    As prescribed in 232.412-70(b), use the following clause:

                   Disposition of Payments (Dec. 1991)

    Payment will be by a dual payee Treasury check made payable to the 
contractor or the (insert the name of the disbursing office in the 
advance payment pool agreement), and will be forwarded to that 
disbursing office for appropriate disposition.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 57 FR 42633, Sept. 15, 1992]



252.232-7002  Progress payments for foreign military sales acquisitions.

    As prescribed in 232.502-4-70(a), use the following clause:

  Progress Payments for Foreign Military Sales Acquisitions (Dec. 1991)

    If this contract includes foreign military sales (FMS) requirements, 
the Contractor shall--
    (a) Submit a separate progress payment request for each progress 
payment rate; and
    (b) Submit a supporting schedule showing--
    (1) The amount of each request distributed to each country's 
requirements; and
    (2) Total price per contract line item applicable to each separate 
progress payment rate.
    (c) Identify in each progress payment request the contract 
requirements to which it applies (i.e., FMS or U.S.);
    (d) Calculate each request on the basis of the prices, costs 
(including costs to complete), subcontractor progress payments, and 
progress payment liquidations of the contract requirements to which it 
applies; and
    (e) Distribute costs among contract line items and countries in a 
manner acceptable to the Administrative Contracting Officer.

[[Page 505]]

                             (End of clause)



252.232-7003  Flexible progress payments.

    As prescribed in 232.502-4-70(b), use the following clause:

                 Flexible Progress Payments (Dec. 1991)

    (a) This contract is subject to flexible progress payment procedures 
as set forth in this clause and Defense FAR Supplement 232.502-1-71.
    (1) The progress payment rate of this contract is ________ percent. 
This percentage applies instead of the customary uniform progress 
payment rate and liquidation rate of the Progress Payments clause.
    (2) The progress payment rate of this contract was determined by the 
DoD Cash Flow Computer Model (name) dated ____________, using percent as 
the minimum rate for the Contractor's investment (as a weighted average 
of costs) in its work in process inventory over the life of the 
contract.
    (b) If actual and projected cash flow data generated during contract 
performance reveal that the customary flexible progress payment rate 
will result in a Contractor investment in work in process inventory more 
than two percentage points higher or lower than the minimum rate of 
Contractor investment specified in paragraph (a)(2) of this clause, the 
progress payment rate shall be redetermined by using the DoD Cash Flow 
Computer Model. Unless it contained an error, the version of the DoD 
Cash Flow Computer Model identified in paragraph (a)(2) of this clause 
shall be used for any redetermination. The customary flexible progress 
payment rate shall not be less than the customary uniform progress 
payment rate that would have applied to this contract absent flexible 
progress payment procedures, and the progress payment rate shall not be 
greater than 100 percent.
    (c) Notwithstanding paragraph (b) of this clause, if at any time the 
flexible progress payment rate is determined to be overstated because 
any factual data submitted by the Contractor in support of the rate 
computation was not current, accurate, and complete at the time the 
flexible progress payment rate was established, the progress payment 
rate shall be reduced to the rate that should have been calculated using 
the model specified in paragraph (a)(2) of this clause. The Contractor 
shall pay interest in accordance with paragraph (d) of this clause on 
all resulting overpayments, computed from the date of the Government's 
overpayment, to the date of liquidation of the overpayment. Payment of 
any unliquidated overpayment and interest shall be due 30 days after the 
date of the first written demand for payment.
    (d) Interest shall be simple interest at the rate established by the 
Secretary of the Treasury as provided in section 12 of the Contract 
Disputes Act of 1978 (Pub. L. 95-563), which is applicable at the time 
the Government made the overpayment, and then at the rate applicable for 
each six month period as fixed by the Secretary, until the overpayment 
is liquidated.
    (e) Flexible progress payment terms will be made available to 
subcontractors in accordance with paragraph (j) of the Progress Payments 
clause and Defense FAR Supplement 232.502-1-71(b)(4).

                             (End of clause)



252.232-7004  DoD progress payment rates.

    As prescribed in 232.502-4-70 (b) and (c), use the following clause:

                  DOD Progress Payment Rates (FEB 1996)

    (a) If the contractor is a large business, the Progress Payments 
clause of this contract is modified to change each mention of the 
progress payment rate and liquidation rate (including paragraph (k), 
Limitations on Undefinitized Contract Actions) to 75 percent.
    (b) If the contractor is a small business, the Progress Payments 
clause of this contract is modified to change each mention of the 
progress payment rate and liquidation rate (excepting paragraph (k), 
Limitations on Undefinitized Contract Actions) to 90 percent.
    (c) If the contractor is a small disadvantaged business, the 
Progress Payments clause of this contract is modified to change each 
mention of the progress payment rate and liquidation rate (excepting 
paragraph (k), Limitations on Undefinitized Contract Actions) to 95 
percent.
    (d) The above rates are the customary uniform progress payment rates 
for DoD contracts.

                             (End of clause)

[56 FR 67221, Dec. 30, 1991, as amended at 58 FR 62046, Nov. 24, 1993; 
61 FR 7750, Feb. 29, 1996]



252.232-7005  Reimbursement of subcontractor advance payments--DoD pilot mentor-protege program.

    As prescribed in 232.412-70(c), use the following clause:

   Reimbursement of Subcontractor Advance Payments--DoD Pilot Mentor-
                       Protege Program (Dec. 1991)

    (a) The Government will reimburse the Contractor for any advance 
payments made by the Contractor, as a mentor firm, to a small 
disadvantaged business, as a protege

[[Page 506]]

firm, pursuant to an approved mentor-protege agreement, provided--
    (1) The Contractor's subcontract with the protege firm includes a 
provision substantially the same as FAR 52.232-12, Advance Payments;
    (2) The Contractor has administered the advance payments in 
accordance with the policies of FAR subpart 32.4; and
    (3) The Contractor agrees that any financial loss resulting from the 
failure or inability of the protege firm to repay any unliquidated 
advance payments is the sole financial responsibility of the Contractor.
    (b) For a fixed price type contract, advance payments made to a 
protege firm shall be paid and administered as if there were 100 percent 
progress payments. The Contractor shall include as a separate attachment 
with each Standard Form (SF) 1443, Contractor's Request for Progress 
Payment, a request for reimbursement of advance payments made to a 
protege firm. The attachment shall provide a separate calculation of 
lines 14a through 14e of SF 1443 for each protege, reflecting the status 
of advance payments made to that protege.
    (c) For cost reimbursable, contracts, reimbursement of advance 
payments shall be made via public voucher. The Contractor shall show the 
amounts of advance payments made to each protege on the public voucher, 
in the form and detail directed by the cognizant contracting officer or 
contract auditor.

                             (End of clause)

[56 FR 67221, Dec. 30, 1991, as amended at 57 FR 53602, Nov. 12, 1992]



252.232-7006  Reduction or suspension of contract payments upon finding of fraud.

    As prescribed in 232.111-70, use the following clause:

Reduction or Suspension of Contract Payments Upon Finding of Fraud (Aug. 
                                  1992)

    (a) 10 U.S.C. 2307(e) permits the head of the agency to reduce or 
suspend further payments to the Contractor upon a written determination 
by the agency head that substantial evidence exists that the Contractors 
request for advance, partial, or progress payments is based on fraud. 
The provisions of 10 U.S.C. 2307(e) are in addition to any other rights 
or remedies provided the Government by law or under contract.
    (b) Actions taken by the Government in accordance with 10 U.S.C. 
2307(e) shall not constitute an excusable delay under the Default clause 
of this contract or otherwise relieve the Contractor of its obligations 
to perform under this contract.

                             (End of clause)

[57 FR 42633, Sept. 15, 1992]



252.232-7007  Limitation of Government's obligation.

    As prescribed in 232.705-70, use the following clause:

            Limitation of Government's Obligation (Aug. 1993)

    (a) Contract line item(s) ______* through ______* are incrementally 
funded. For these item(s), the sum of $______* of the total price is 
presently available for payment and allotted to this contract. An 
allotment schedule is set forth in paragraph (i) of this clause.
    (b) For item(s) identified in paragraph (a) of this clause, the 
Contractor agrees to perform up to the point at which the total amount 
payable by the Government, including reimbursement in the event of 
termination of those item(s) for the Government's convenience, 
approximates the total amount currently allotted to the contract. The 
Contractor will not be obligated to continue work on those item(s) 
beyond that point. The Government will not be obligated in any event to 
reimburse the Contractor in excess of the amount allotted to the 
contract for those item(s) regardless of anything to the contrary in the 
clause entitled ``Termination for Convenience of the Government.'' As 
used in this clause, the total amount payable by the Government in the 
event of termination of applicable contract line item(s) for convenience 
includes costs, profit, and estimated termination settlement costs for 
those items(s).
    (c) Notwithstanding the dates specified in the allotment schedule in 
paragraph (i) of this clause, the Contractor will notify the Contracting 
Officer in writing at least ninety days prior to the date when, in the 
Contractor's best judgment, the work will reach the point at which the 
total amount payable by the Government, including any cost for 
termination for convenience, will approximate 85 percent of the total 
amount then allotted to the contract for performance of the applicable 
item(s). The notification will state (1) the estimated date when that 
point will be reached and (2) an estimate of additional funding, if any, 
needed to continue performance of applicable line items up to the next 
scheduled date for allotment of funds identified in paragraph (i) of 
this clause, or to a mutually agreed upon substitute date. The 
notification will also advise the Contracting Officer of the estimated 
amount of additional funds that will be required for the timely 
performance of the item(s) funded pursuant to this clause, for a 
subsequent period as may be specified in the allotment schedule in 
paragraph (i) of this

[[Page 507]]

clause, or otherwise agreed to by the parties. If after such 
notification additional funds are not allotted by the date identified in 
the Contractor's notification, or by an agreed substitute date, the 
Contracting Officer will terminate any item(s) for which additional 
funds have not been allotted, pursuant to the clause of this contract 
entitled ``Termination for Convenience of the Government.''
    (d) When additional funds are allotted for continued performance of 
the contract line item(s) identified in paragraph (a) of this clause, 
the parties will agree as to the period of contract performance which 
will be covered by the funds. The provisions of paragraph (b) through 
(d) of this clause will apply in like manner to the additional allotted 
funds and agreed substitute date, and the contract will be modified 
accordingly.
    (e) If, solely by reason of failure of the Government to allot 
additional funds, by the dates indicated below, in amounts sufficient 
for timely performance of the contract line item(s) identified in 
paragraph (a) of this clause, the Contractor incurs additional costs or 
is delayed in the performance of the work under this contract and if 
additional funds are allotted, an equitable adjustment will be made in 
the price or prices (including appropriate target, billing, and ceiling 
prices where applicable) of the item(s), or in the time of delivery, or 
both. Failure to agree to any such equitable adjustment hereunder will 
be a dispute concerning a question of fact within the meaning of the 
clause entitled ``Disputes.''
    (f) The Government may at any time prior to termination allot 
additional funds for the performance of the contract line item(s) 
identified in paragraph (a) of this clause.
    (g) The termination provisions of this clause do not limit the 
rights of the Government under the clause entitled ``Default.'' The 
provisions of this clause are limited to the work and allotment of funds 
for the contract line item(s) set forth in paragraph (a) of this clause. 
This clause no longer applies once the contract is fully funded except 
with regard to the rights or obligations of the parties concerning 
equitable adjustments negotiated under paragraphs (d) or (e) of this 
clause.
    (h) Nothing in this clause affects the right of the Government to 
terminate this contract pursuant to the clause of this contract entitled 
``Termination for Convenience of the Government.''
    (i) The parties contemplate that the Government will allot funds to 
this contract in accordance with the following schedule:
On execution of contract.............................................$    

(month) (day), 199x..................................................$    

(month) (day), 199y..................................................$    

(month) (day), 199z..................................................$    


                             (End of clause)

                         Alternate I (Aug. 1993)

    If only one line item will be incrementally funded, substitute the 
following paragraph (a) for paragraph (a) of the basic clause.
    (a) Contract line item ______ is incrementally funded. The sum of 
$______* is presently available for payment and allotted to this 
contract. An allotment schedule is contained in paragraph (i) of this 
clause.

    *To be inserted after negotiation.
[58 FR 46093, Sept. 1, 1993]



252.232-7008  Assignment of claims (overseas).

    As prescribed in 232.806(a)(1), use the following clause:

               Assignment of Claims (Overseas) (JUNE 1997)

    (a) No claims for monies due, or to become due, shall be assigned by 
the Contractor unless--
    (1) Approved in writing by the Contracting Officer;
    (2) Made in accordance with the laws and regulations of the United 
States of America; and
    (3) Permitted by the laws and regulations of the Contractor's 
country.
    (b) In no event shall copies of this contract of any plans, 
specifications, or other similar documents relating to work under this 
contract, if marked ``Top Secret,'' ``Secret,'' or ``Confidential'' be 
furnished to any assignee of any claim arising under this contract or to 
any other person not entitled to receive such documents. However, a copy 
of any part or all of this contract so marked may be furnished, or any 
information contained herein may be disclosed, to such assignee upon the 
Contracting Officer's prior written authorization.
    (c) Any assignment under this contract shall cover all amounts 
payable under this contract and not already paid, and shall not be made 
to more than one party, except that any such assignment may be made to 
one party as agent or trustee for two or more parties participating in 
such financing. On each invoice or voucher submitted for payment under 
this contract to which any assignment applies, and for which direct 
payment thereof is to be made to an assignee, the Contractor shall--
    (1) Identify the assignee by name and complete address; and
    (2) Acknowledge the validity of the assignment and the right of the 
named assignee to receive payment in the amount invoiced or vouchered.

[[Page 508]]

                             (End of clause)

[62 FR 34134, June 24, 1997]



252.233-7000  [Reserved]



252.233-7001  Choice of law (overseas).

    As prescribed in 233.215-70, use the following clause:

                  Choice of Law (Overseas) (JUNE 1997)

    This contract shall be construed and interpreted in accordance with 
the substantive laws of the United States of America. By the execution 
of this contract, the Contractor expressly agrees to waive any rights to 
invoke the jurisdiction of local national courts where this contract is 
performed and agrees to accept the exclusive jurisdiction of the United 
States Armed Services Board of Contract Appeals and the United States 
Court of Federal Claims for hearing and determination of any and all 
disputes that may arise under the Disputes clause of this contract.

                             (End of clause)

[62 FR 34135, June 24, 1997]



252.234-7000  Notice of earned value management system.

    As prescribed in 234.005-71, use the following provision:

           Notice of Earned Value Management System (Mar 1997)

    (a) The offeror shall provide documentation that the cognizant 
Administrative Contracting Officer (ACO) has recognized that the 
proposed earned value management system (EVMS) complies with the EVMS 
criteria of DoD 5000.2-R, Mandatory Procedures for Major Defense 
Acquisition Programs (MDAPs) and Major Automated Information System 
(MAIS) Acquisition Programs, or that the proposed cost/schedule control 
system has been accepted by the Government.
    (b) If the offeror proposes to use a system that does not meet the 
requirements of paragraph (a) of this provision, the offeror shall 
submit a comprehensive plan for compliance with the EVMS criteria.
    (1) The plan shall--
    (A) Describe the EVMS the offeror intends to use in performance of 
the contract;
    (B) Distinguish between the offeror's existing management system and 
modifications proposed to meet the criteria;
    (C) Describe the management system and its application in terms of 
the 32 EVMS criteria;
    (D) Describe the proposed procedure for administration of the 
criteria as applied to subcontractors; and
    (E) Provide documentation describing the process and results of any 
third-party or self-evaluation of the system's compliance with EVMS 
criteria.
    (2) The offeror shall provide information and assistance as required 
by the Contracting Officer to support review of the plan.
    (3) The Government will review the offeror's plan for EVMS before 
contract award.
    (c) Offerors shall identify the major subcontractors, or major 
subcontracted effort if major subcontractors have not been selected, 
planned for application of the criteria. The prime contractor and the 
Government shall agree to subcontractors selected for application of the 
EVMS criteria.

                           (End of provision)

[62 FR 9991, Mar. 5, 1997, as amended at 62 FR 34135, June 24, 1997; 62 
FR 49305, Sept. 19, 1997]



252.234-7001  Earned value management system.

    As prescribed in 234.005-71, use the following clause:

                Earned Value Management System (Mar 1997)

    (a) In the performance of this contract, the Contractor shall use an 
earned value management system (EVMS) meeting the criteria provided in 
DoD 5000.2-R, Mandatory Procedures for Major Defense Acquisition 
Programs (MDAPs) and Major Automated Information System (MATs) 
Acquisition Programs.
    (b) If the Contractor has an EVMS that has been recognized by the 
cognizant Administrative Contracting Officer (ACO) as complying with the 
EVMS criteria (or an existing cost/schedule control system (C/SCS) that 
has been accepted by the Government), the Contractor shall apply the 
system to this contract within 60 calendar days after contract award or 
as otherwise agreed to by the parties.
    (c) If the Contractor does not have an EVMS that has been recognized 
by the cognizant ACO as complying with EVMS criteria (or does not have 
an existing C/SCS that has been accepted by the Government), the 
Contractor shall be prepared to demonstrate to the ACO that the EVMS 
complies with the EVMS criteria referenced in paragraph (a) of this 
clause.
    (d) The Government may require an integrated baseline review within 
180 calendar days after (1) contract award, (2) the exercise of 
significant contract options, or (3) the incorporation of major 
modifications. The purpose of the integrated baseline review is for the 
Government and the Contractor to jointly assess areas, such as the 
Contractor's planning, to ensure complete coverage of the

[[Page 509]]

statement of work, logical scheduling of the work activities, adequate 
resourcing, and identification of inherent risks.
    (e) Unless a waiver is granted by the ACO, Contractor proposed EVMS 
changes require approval of the ACO prior to implementation. The ACO 
shall advise the Contractor of the acceptability of such changes within 
30 calendar days after receipt of the notice of proposed changes from 
the Contractor. If the advance approval requirements are waived by the 
ACO, the Contractor shall disclose EVMS changes to the ACO at least 14 
calendar days prior to the effective date of implementation.
    (f) The Contractor agrees to provide access to all pertinent records 
and data requested by the ACO or duly authorized representatives. Access 
is to permit Government surveillance to ensure that the EVMS complies, 
and continues to comply, with the criteria referenced in paragraph (a) 
of this clause.
    (g) The Contractor shall require those subcontractors specified in 
the contract for application of the EVMS criteria to comply with the 
requirements of this clause.

                             (End of clause)

[62 FR 9992, Mar. 5, 1997, as amended at 62 FR 34135, June 24, 1997; 62 
FR 49305, Sept. 19, 1997]



252.235-7000  Indemnification under 10 U.S.C. 2354--fixed price.

    As prescribed in 235.070-3, use the following clause:

      Indemnification Under 10 U.S.C. 2354--Fixed Price (Dec. 1991)

    (a) This clause provides for indemnification under 10 U.S.C. 2354 if 
the Contractor meets all the terms and conditions of this clause.
    (b) Claims, losses, and damages covered--
    (1) Claims by third persons for death, bodily injury, sickness, or 
disease, or the loss, damage, or lost use of property. Claims include 
those for reasonable expenses of litigation or settlement. The term 
third persons includes employees of the contractor;
    (2) The loss, damage, and lost use of the Contractor's property, but 
excluding lost profit; and
    (3) Loss, damage, or lost use of the Government's property.
    (c) The claim, loss, or damage--
    (1) Must arise from the direct performance of this contract;
    (2) Must not be compensated by insurance or other means, or be 
within deductible amounts of the Contractor's insurance;
    (3) Must result from an unusually hazardous risk as specifically 
defined in the contract;
    (4) Must not result from willful misconduct or lack of good faith on 
the part of any of the Contractor's directors or officers, managers, 
superintendents, or other equivalent representatives who have 
supervision or direction of--
    (i) All or substantially all of the Contractor's business;
    (ii) All or substantially all of the Contractor's operations at any 
one plant or separate location where this contract is being performed; 
or
    (iii) A separate and complete major industrial operation connected 
with the performance of this contract;
    (5) Must not be a liability assumed under any contract or agreement 
(except for subcontracts covered by paragraph (h) of this clause), 
unless the Contracting Officer (or in contracts with the Department of 
the Navy, the Department) specifically approved the assumption of 
liability; and
    (6) Must be certified as just and reasonable by the Secretary of the 
department or designated representative.
    (d) The Contractor shall buy and maintain, to the extent available, 
insurance against unusually hazardous risks in the form, amount, 
period(s) of time, at the rate(s), and with such insurers, as the 
Contracting Officer (or, for Navy contracts, the Department) may from 
time to time require and approve. If the cost of this insurance is 
higher than the cost of the insurance the Contractor had as of the date 
of the contract, the Government shall reimburse the Contractor for the 
difference in cost, as long as it is properly allocable to this contract 
and is not included in the contract price. The Government shall not be 
liable for claims, loss, or damage if insurance was available and is 
either required or approved under this paragraph.
    (e) A reduction of the insurance coverage maintained by the 
Contractor on the date of the execution of this contract shall not 
increase the Government's liability under this clause unless the 
Contracting Officer consents, and the contract price is equitably 
adjusted, if appropriate, to reflect the Contractor's consideration for 
the Government's assumption of increased liability.
    (f) Notice. The Contractor shall--
    (1) Promptly notify the Contracting Officer of any occurrence, 
action, or claim that might trigger the Government's liability under 
this clause;
    (2) Furnish the proof or evidence of any claim, loss, or damage in 
the form and manner that the Government requires; and
    (3) Immediately provide copies of all pertinent papers that the 
Contractor receives or has received.
    (g) The Government may direct, participate in, and supervise the 
settlement or defense of the claim or action. The Contractor shall 
comply with the Government's directions and execute any authorizations 
required.

[[Page 510]]

    (h) Flowdown. The Government shall indemnify the Contractor if the 
Contractor has an obligation to indemnify a subcontractor under any 
subcontract at any tier under this contract for the unusually hazardous 
risk identified in this contract only if--
    (1) The Contracting Officer gave prior written approval for the 
Contractor to provide in a subcontract for the Contractor to indemnify 
the subcontractor for unusually hazardous risks defined in this 
contract;
    (2) The Contracting Officer approved those indemnification 
provisions;
    (3) The subcontract indemnification provisions entitle the 
Contractor, or the Government, or both, to direct, participate in, and 
supervise the settlement or defense of relevant actions and claims; and
    (4) The subcontract provides the same rights and duties, the same 
provisions for notice, furnishing of papers and the like, between the 
Contractor and the subcontractor, as exist between the Government and 
the Contractor under this clause.
    (i) The Government may discharge its obligations under paragraph (h) 
of this clause by making payments directly to subcontractors or to 
persons to whom the subcontractors may be liable.
    (j) The rights and obligations of the parties under this clause 
shall survive the termination, expiration, or completion of this 
contract.

                             (End of clause)



252.235-7001  Indemnification under 10 U.S.C. 2354--cost reimbursement.

    As prescribed in 235.070-3, use the following clause:

  Indemnification Under 10 U.S.C. 2354--Cost Reimbursement (Dec. 1991)

    (a) This clause provides for indemnification under 10 U.S.C. 2354 if 
the Contractor meets all the terms and conditions of this clause.
    (b) Claims, losses, and damages covered--
    (1) Claims by third persons for death, bodily injury, sickness, or 
disease, or the loss, damage, or lost use of property. Claims include 
those for reasonable expenses of litigation or settlement. The term 
``third persons'' includes employees of the Contractor;
    (2) The loss, damage, and lost use of the Contractor's property, but 
excluding lost profit; and
    (3) Loss, damage, or lost use of the Government's property.
    (c) The claim, loss, or damage--
    (1) Must arise from the direct performance of this contract;
    (2) Must not be compensated by insurance or other means, or be 
within deductible amounts of the Contractor's insurance;
    (3) Must result from an unusually hazardous risk as specifically 
defined in the contract;
    (4) Must not result from willful misconduct or lack of good faith on 
the part of any of the Contractor's directors or officers, managers, 
superintendents, or other equivalent representatives who have 
supervision or direction of--
    (i) All or substantially all of the Contractor's business;
    (ii) All or substantially all of the Contractor's operations at any 
one plant or separate location where this contract is being performed; 
or
    (iii) A separate and complete major industrial operation connected 
with the performance of this contract;
    (5) Must not be a liability assumed under any contract or agreement 
(except for subcontracts covered by paragraph (i) of this clause), 
unless the Contracting Officer (or in contracts with the Department of 
the Navy, the Department) specifically approved the assumption of 
liability; and
    (6) Must be certified as just and reasonable by the Secretary of the 
department or designated representative.
    (d) A reduction of the insurance coverage maintained by the 
Contractor on the date of the execution of this contract shall not 
increase the Government's liability under this clause unless the 
Contracting Officer consents, and the contract price is equitably 
adjusted, if appropriate, to reflect the Contractor's consideration for 
the Government's assumption of increased liability.
    (e) Notice. The Insurance--Liability to Third Persons clause of this 
contract applies also to claims under this clause. In addition, the 
Contractor shall--
    (1) Promptly notify the Contracting Officer of any occurrence, 
action, or claim that might trigger the Government's liability under 
this clause;
    (2) Furnish the proof or evidence of any claim, loss, or damage in 
the form and manner that the Government requires; and
    (3) Immediately provide copies of all pertinent papers that the 
contractor receives or has received.
    (f) The Government may direct, participate in, and supervise the 
settlement or defense of the claim or action. The Contractor shall 
comply with the Government's directions, and execute any authorizations 
required.
    (g) The Limitation of Cost clause of this contract does not apply to 
the Government's obligations under this clause. The obligations under 
this clause are excepted from the release required by the Allowable 
Cost, Fee, and Payment clause of this contract.
    (h) Under this clause, a claim, loss, or damage arises from the 
direct performance of this contract if the cause of the claim, loss,

[[Page 511]]

or damage occurred during the period of performance of this contract or 
as a result of the performance of this contract.
    (i) Flowdown. The Government shall indemnify the Contractor if the 
Contractor has an obligation to indemnify a subcontractor under any 
subcontract at any tier under this contract for the unusually hazardous 
risk identified in this contract only if--
    (1) The Contracting Officer gave prior written approval for the 
Contractor to provide in a subcontract for the Contractor to indemnify 
the subcontractor for unusually hazardous risks defined in this 
contract;
    (2) The Contracting Officer approved those indemnification 
provisions;
    (3) The subcontract indemnification provisions entitle the 
Contractor, or the Government, or both, to direct, participate in, and 
supervise the settlement or defense of relevant actions and claims; and
    (4) The subcontract provides the same rights and duties, the same 
provisions for notice, furnishing of paper and the like, between the 
Contractor and the subcontractor, as exist between the Government and 
the Contractor under this clause.
    (j) The Government may discharge its obligations under paragraph (i) 
of this clause by making payments directly to subcontractors or to 
persons to whom the subcontractors may be liable.
    (k) The rights and obligations of the parties under this clause 
shall survive the termination, expiration, or completion of this 
contract.

                             (End of clause)



252.235-7002  Animal welfare.

    As prescribed in 235.071(a), use the following clause:

                       Animal Welfare (Dec. 1991)

    (a) The Contractor shall register its research facility with the 
Secretary of Agriculture in accordance with 7 U.S.C. 2316 and 9 CFR 
subpart C, and Sec. 2.30, and furnish evidence of such registration to 
the Contracting Officer before beginning work under this contract.
    (b) The Contractor shall acquire animals only from dealers licensed 
by the Secretary of Agriculture under 7 U.S.C. 2133 and 9 CFR subpart A, 
Secs. 2.1 through 2.11, or from sources that are exempt from licensing 
under those sections.
    (c) The Contractor agrees that the care and use of animals will 
conform with the pertinent laws of the United States and regulations of 
the Department of Agriculture (see 7 U.S.C. 2131 et seq. and 9 CFR 
subchapter A, parts 1 through 4).
    (d) The Contracting Officer may immediately suspend, in whole or in 
part, work and further payments under this contract for failure to 
comply with the requirements of paragraphs (a) through (c) of this 
clause.
    (1) The suspension will stay in effect until the Contractor complies 
with the requirements.
    (2) Failure to complete corrective action within the time specified 
by the Contracting Officer may result in termination of this contract 
and removal of the Contractor's name from the list of contractors with 
approved Public Health Service Welfare Assurances.
    (e) The Contractor may request registration of its facility and a 
current listing of licensed dealers from the Regional Office of the 
Animal and Plant Health Inspection Service (APHIS), United States 
Department of Agriculture (USDA), for the region in which its research 
facility is located. The location of the appropriate APHIS regional 
office, as well as information concerning this program may be obtained 
by contacting the Senior Staff Officer, Animal Care Staff, USDA/APHIS, 
Federal Center Building, Hyattsville, MD 20782.
    (f) The Contractor shall include this clause, including this 
paragraph (f), in all subcontracts involving research of live vertebrate 
animals.

                             (End of clause)



252.235-7003  Frequency authorization.

    As prescribed in 235.071(b), use the following clause:

                   Frequency Authorization (Dec. 1991)

    (a) The Contractor shall obtain authorization for radio frequencies 
required in support of this contract.
    (b) For any experimental, developmental, or operational equipment 
for which the appropriate frequency allocation has not been made, the 
Contractor shall provide the technical operating characteristics of the 
proposed electromagnetic radiating device to the Contracting Officer 
during the initial planning, experimental, or developmental phase of 
contract performance.
    (c) The Contracting Officer shall furnish the procedures for 
obtaining radio frequency authorization.
    (d) The Contractor shall include this clause, including this 
paragraph (d), in all subcontracts requiring the development, 
production, construction, testing, or operation of a device for which a 
radio frequency authorization is required.

                             (End of clause)

                         Alternate I (Dec. 1991)

    Substitute the following paragraph (c) for paragraph (c) of the 
basic clause if agency procedures authorize use of

[[Page 512]]

DD Form 1494, Application for Frequency Authorization:
    (c) The Contractor shall use DD Form 1494, Application for Frequency 
Authorization, to obtain radio frequency authorization.



252.235-7004  Option to extend the term of the contract.

    As prescribed in 235.015-71(i)(2), use the following clause:

          Option to Extend the Term of the Contract (Dec. 1991)

    If the Contractor's proposal covers an additional period(s) which 
could be treated as an optional period(s), the Contracting Officer may--
    (a) Add the additional period(s) to the contract as an option(s); 
and
    (b) Exercise such option(s) by written notice of exercise at any 
time during the performance period or any extensions thereof.

                             (End of clause)



252.235-7005  Contractor-acquired property.

    As prescribed in 235.015-71(i)(2), use the following clause:

                Contractor-Acquired Property (Dec. 1991)

    (a) Definition. Property, as used in this clause, means all 
nonexpendable tangible personal property (except material)--
    (1) Described in FAR 45.101, including automatic data processing 
equipment as defined in FAR 31.001, and facilities as defined in FAR 
45.301;
    (2) Which is acquired with funds provided under this contract for 
the conduct of research;
    (3) Which the Contractor has specifically identified in its 
proposal; and
    (4) Which the Contracting Officer has authorized the Contractor to 
acquire.
    (b) The Contracting Officer may accept the identification and 
description in the Contractor's proposal of property to be Contractor-
acquired property as advance notification required by subparagraphs (a) 
and (b) of the clause of this contract entitled ``Subcontracts Under 
Cost-Reimbursement and Letter Contracts.''
    (c) Except for those items specifically identified in the contract 
as required by Block 27a of the DD Form 2222 (Research Contract (SFRC)/
Modification, Short Form), award of this contract constitutes the 
Contracting Officer's written consent to acquire property in the 
Contractor's proposal.
    (d) The Contracting Officer will approve or disapprove subcontracts 
to acquire the items listed in Block 27a of the DD Form 2222 after the 
award of any contract resulting from this solicitation.

                             (End of clause)



252.235-7006  Title to contractor-acquired property.

    As prescribed in 235.015-71(i)(2), use the following clause:

            Title to Contractor-Acquired Property (Dec. 1991)

    (a) Definition. Property, as used in this clause, has the meaning 
given in the Contractor-Acquired Property clause of this contract.
    (b) Title shall vest in the Contractor without further obligation 
when the property--
    (1) Has an acquisition cost of $1,000 or more;
    (2) Was specifically identified in the Contractor's proposal; and
    (3) Is property other than that property for which a determination 
of title is deferred. Property for which the determination of title is 
deferred shall be identified in Block 27b of the DD Form 2222, Research 
Contract (SFRC)/Modification, Short Form.
    (c) Title in all property which--
    (1) Has an acquisition cost of $1,000 or more; and
    (2) Was not specifically identified in the Contractor's proposal; or
    (3) Is property for which a determination of title is deferred, may 
vest--
    (i) In the Government;
    (ii) In the Contractor; or
    (iii) In the Contractor, subject to the right of the Government to 
direct transfer of the title back to the Government or third parties. 
The Government may exercise this right at any time up to and including 
the twelfth month after completion or termination of the contract. The 
Government at any time may remove an item of property from this 
category, give up the right to direct transfer of the title back to the 
Government or third parties, and transfer title to the Contractor.
    (d) Transfer of title back to the Government or third parties shall 
not be the basis for any claim by the Contractor. The Government 
Property (Cost-Reimbursement, Time and Material, or Labor Hour 
Contracts) clause and its Alternate I of this contract apply to any 
changes in property.
    (e) Property acquired with funds made available under this contract 
shall be considered Government property subject to the Government 
Property clause until title to such property vests in the Contractor 
without right of the Government to direct transfer of the title back to 
the Government or third parties.
    (f) Within 45 days following the end of the calendar year or the 
Contractor's fiscal year, the Contractor shall furnish the Contracting

[[Page 513]]

Officer a list of all property with an acquisition cost of $1,000 or 
more which the Contractor acquired under this contract during that year 
and to which title has not vested in the Contractor.

                             (End of clause)



252.235-7007  Advance payments.

    As prescribed in 235.015-71(i)(2), use the following clause:

                      Advance Payments (Dec. 1991)

    The advance payment pool agreement between the Contractor and one or 
more military departments which is in effect as of the date of, and 
applies to, this contract shall govern advance payments made under this 
contract. If such an agreement is not in effect as of the date of this 
contract, the Allowable Cost and Payment clause of this contract shall 
govern payments to the Contractor.

                             (End of clause)



252.235-7008  Inspection and acceptance.

    As prescribed in 235.015-71(i)(2), use the following clause:

                  Inspection and Acceptance (Dec. 1991)

    The Scientific Program Officer designated in Block 11 on the DD Form 
2222 (Research Contract (SFRC)/Modification, Short Form) of this 
contract shall conduct inspection and acceptance of the final delivery. 
The Scientific Program Officer shall have at least 30 days after 
contractual delivery for acceptance.

                             (End of clause)



252.235-7009  Restriction on printing.

    As prescribed in 235.015-71(i)(2), use the following clause:

                   Restriction on Printing (Dec. 1991)

    The Contractor is authorized to reproduce reports, data, or other 
written materials, if required, provided the material produced does not 
exceed 5,000 production units of any page, and items consisting of 
multiple pages do not exceed 25,000 production units in the aggregate. 
The Contractor shall obtain the express prior written authorization of 
the Contracting Officer to reproduce material in excess of these 
quantities.

                             (End of clause)



252.235-7010  Acknowledgment of support and disclaimer.

    As prescribed in 235.071(c), use the following clause:

           Acknowledgment of Support and Disclaimer (May 1995)

    (a) The Contractor shall include an acknowledgment of the 
Government's support in the publication of any material based on or 
developed under this contract, stated in the following terms: This 
material is based upon work supported by the (name of contracting 
agency(ies)) under Contract No. (Contracting agency(ies) contract 
number(s)).
    (b) All material, except scientific articles or papers published in 
scientific journals, must, in addition to any notices or disclaimers by 
the Contractor, also contain the following disclaimer: Any opinions, 
findings and conclusions or recommendations expressed in this material 
are those of the author(s) and do not necessarily reflect the views of 
the (name of contracting agency(ies)).

                             (End of clause)

[60 FR 29503, June 5, 1995]



252.235-7011  Final scientific or technical report.

    As prescribed in 235.071(d), use the following clause:

             Final Scientific or Technical Report (May 1995)

    The Contractor shall submit two copies of the approved scientific or 
technical report delivered under this contract to the Defense Technical 
Information Center (DTIC), Attn: DTIC-OC, Cameron Station, Alexandria, 
VA 22304-6145. The Contractor shall include a completed Standard Form 
298, Report Documentation Page, with each copy of the report. For 
submission of reports in other than paper copy, contact the Defense 
Technical Information Center, Attn: DTIC-OC, Cameron Station, 
Alexandria, VA 22304-6145.

                             (End of clause)

[60 FR 29503, June 5, 1995]



252.236-7000  Modification proposals--price breakdown.

    As prescribed in 236.570(a), use the following clause:

[[Page 514]]

           Modification Proposals--Price Breakdown (Dec. 1991)

    (a) The Contractor shall furnish a price breakdown, itemized as 
required and within the time specified by the Contracting Officer, with 
any proposal for a contract modification.
    (b) The price breakdown--
    (1) Must include sufficient detail to permit an analysis of profit, 
and of all costs for--
    (i) Material;
    (ii) Labor;
    (iii) Equipment;
    (iv) Subcontracts; and
    (v) Overhead; and
    (2) Must cover all work involved in the modification, whether the 
work was deleted, added, or changed.
    (c) The Contractor shall provide similar price breakdowns to support 
any amounts claimed for subcontracts.
    (d) The Contractor's proposal shall include a justification for any 
time extension proposed.

                             (End of clause)



252.236-7001  Contract drawings, maps, and specifications.

    As prescribed in 236.570(a), use the following clause:

         Contract Drawings, Maps, and Specifications (Dec. 1991)

    (a) The Government--
    (1) Will provide the Contractor, without charge, ________ sets (five 
unless otherwise specified) of large-scale contract drawings and 
specifications except publications incorporated into the technical 
provisions by reference;
    (2) Will furnish additional sets on request, for the cost of 
reproduction; and
    (3) May, at its option, furnish the Contractor one set of 
reproducibles, or half-size drawings, in lieu of the drawings in 
paragraph (a)(1) of this clause.
    (b) The Contractor shall--
    (1) Check all drawings furnished immediately upon receipt;
    (2) Compare all drawings and verify the figures before laying out 
the work;
    (3) Promptly notify the Contracting Officer of any discrepancies; 
and
    (4) Be responsible for any errors which might have been avoided by 
complying with this paragraph (b).
    (c) Large scale drawings shall, in general, govern small scale 
drawings. Figures marked on drawings shall, in general, be followed in 
preference to scale measurements.
    (d) Omissions from the drawings or specifications or the 
misdescription of details of work which are manifestly necessary to 
carry out the intent of the drawings and specifications, or which are 
customarily performed, shall not relieve the contractor from performing 
such omitted or misdescribed details of the work, but shall be performed 
as if fully and correctly set forth and described in the drawings and 
specifications.
    (e) The work shall conform to the specifications and the contract 
drawings identified on the following index of drawings:

                                                                        
      Title             File               and            Drawing No.   
                                                                        
                                                                        
                                                                        

                             (End of clause)



252.236-7002  Obstruction of navigable waterways.

    As prescribed in 236.570(b)(1), use the following clause:

             Obstruction of Navigable Waterways (Dec. 1991)

    (a) The Contractor shall--
    (1) Promptly recover and remove any material, plant, machinery, or 
appliance which the contractor loses, dumps, throws overboard, sinks, or 
misplaces, and which, in the opinion of the Contracting Officer, may be 
dangerous to or obstruct navigation;
    (2) Give immediate notice, with description and locations of any 
such obstructions, to the Contracting Officer; and
    (3) When required by the Contracting Officer, mark or buoy such 
obstructions until the same are removed.
    (b) The Contracting Officer may--
    (1) Remove the obstructions by contract or otherwise should the 
Contractor refuse, neglect, or delay compliance with paragraph (a) of 
this clause; and
    (2) Deduct the cost of removal from any monies due or to become due 
to the Contractor; or
    (3) Recover the cost of removal under the Contractor's bond.
    (c) The Contractor's liability for the removal of a vessel wrecked 
or sunk without fault or negligence is limited to that provided in 
sections 15, 19, and 20 of the River and Harbor Act of March 3, 1899 (33 
U.S.C. 410 et seq.).

                             (End of clause)



252.236-7003  Payment for mobilization and preparatory work.

    As prescribed in 236.570(b)(2), use the following clause:

        Payment for Mobilization and Preparatory Work (JAN 1997)

    (a) The Government will make payment to the Contractor under the 
procedures in this clause for mobilization and preparatory work under 
item no. __________.

[[Page 515]]

    (b) Payments will be made for actual payments by the Contractor on 
work preparatory to commencing actual work on the construction items for 
which payment is provided under the terms of this contract, as follows--
    (1) For construction plant and equipment exceeding $25,000 in value 
per unit (as appraised by the Contracting Officer at the work site) 
acquired for the execution of the work;
    (2) Transportation of all plant and equipment to the site;
    (3) Material purchased for the prosecution of the contract, but not 
to be incorporated in the work;
    (4) Construction of access roads or railroads, camps, trailer 
courts, mess halls, dormitories or living quarters, field headquarters 
facilities, and construction yards;
    (5) Personal services; and
    (6) Hire of plant.
    (c) Requests for payment must include--
    (1) An account of the Contractor's actual expenditures;
    (2) Supporting documentation, including receipted bills or copies of 
payrolls and freight bills; and
    (3) The Contractor's documentation--
    (i) Showing that it has acquired the construction plant, equipment, 
and material free from all encumbrances;
    (ii) Agreeing that the construction plant, equipment, and material 
will not be removed from the site without the written permission of the 
Contracting Officer; and
    (iii) Agreeing that structures and facilities prepared or erected 
for the prosecution of the contract work will be maintained and not 
dismantled prior to the completion and acceptance of the entire work, 
without the written permission of the Contracting Officer.
    (d) Upon receiving a request for payment, the Government will make 
payment, less any prescribed retained percentage, if--
    (1) The Contracting Officer finds the--
    (i) Construction plant, material, equipment, and the mobilization 
and preparatory work performed are suitable and necessary to the 
efficient prosecution of the contract; and
    (ii) Preparatory work has been done with proper economy and 
efficiency.
    (2) Payments for construction plant, equipment, material, and 
structures and facilities prepared or erected for prosecution of the 
contract work do not exceed--
    (i) The Contractor's cost for the work performed less the estimated 
value upon completion of the contract; and
    (ii) 100 percent of the cost to the contractor of any items having 
no appreciable salvage value; and
    (iii) 75 percent of the cost to the contractor of items which do 
have an appreciable salvage value.
    (e) (1) Payments will continue to be made for item no. ________, and 
all payments will be deducted from the contract price for this item, 
until the total deductions reduce this item to zero, after which no 
further payments will be made under this item.
    (2) If the total of payments so made does not reduce this item to 
zero, the balance will be paid to the Contractor in the final payment 
under the contract.
    (3) The retained percentage will be paid in accordance with the 
Payments to Contractor clause of this contract.
    (f) The Contracting Officer shall determine the value and 
suitability of the construction plant, equipment, materials, structures 
and facilities. The Contracting Officer's determinations are not subject 
to appeal.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 62 FR 2614, Jan. 17, 1997]



252.236-7004  Payment for mobilization and demobilization.

    As prescribed in 236.570(b)(2), use the following clause:

         Payment for Mobilization and Demobilization (Dec. 1991)

    (a) The Government will pay all costs for the mobilization and 
demobilization of all of the Contractor's plant and equipment at the 
contract lump sum price for this item.
    (1) ________ percent of the lump sum price upon completion of the 
contractor's mobilization at the work site.
    (2) The remaining ________ percent upon completion of 
demobilization.
    (b) The Contracting Officer may require the Contractor to furnish 
cost data to justify this portion of the bid if the Contracting Officer 
believes that the percentages in paragraphs (a) (1) and (2) of this 
clause do not bear a reasonable relation to the cost of the work in this 
contract.
    (1) Failure to justify such price to the satisfaction of the 
Contracting Officer will result in payment, as determined by the 
Contracting Officer, of--
    (i) Actual mobilization costs at completion of mobilization;
    (ii) Actual demobilization costs at completion of demobilization; 
and
    (iii) The remainder of this item in the final payment under this 
contract.
    (2) The Contracting Officer's determination of the actual costs in 
paragraph (b)(1) of this clause is not subject to appeal.

[[Page 516]]

                             (End of clause)



252.236-7005  Airfield safety precautions.

    As prescribed in 236.570(b)(3), use the following clause. At some 
airfields, the width of the primary surface is 1,500 feet (750 feet on 
each side of the runway centerline). In such instances, substitute the 
proper width in the clause.

                 Airfield Safety Precautions (Dec. 1991)

    (a) Definitions. As used in this clause--
    (1) Landing areas means--
    (i) The primary surfaces, comprising the surface of the runway, 
runway shoulders, and lateral safety zones. The length of each primary 
surface is the same as the runway length. The width of each primary 
surface is 2,000 feet (1,000 feet on each side of the runway 
centerline);
    (ii) The clear zone beyond the ends of each runway, i.e., the 
extension of the primary surface for a distance of 1,000 feet beyond 
each end of each runway;
    (iii) All taxiways, plus the lateral clearance zones along each side 
for the length of the taxiways (the outer edge of each lateral clearance 
zone is laterally 250 feet from the far or opposite edge of the taxiway, 
e.g., a 75-foot-wide taxiway would have a combined width of taxiway and 
lateral clearance zones of 425 feet); and
    (iv) All aircraft parking aprons, plus the area 125 feet in width 
extending beyond each edge all around the aprons.
    (2) Safety precaution areas means those portions of approach-
departure clearance zones and transitional zones where placement of 
objects incident to contract performance might result in vertical 
projections at or above the approach-departure clearance, or the 
transitional surface.
    (i) The approach-departure clearance surface is an extension of the 
primary surface and the clear zone at each end of each runway, for a 
distance of 50,000 feet, first along an inclined (glide angle) and then 
along a horizontal plane, both flaring symmetrically about the runway 
centerline extended.
    (A) The inclined plane (glide angle) begins in the clear zone 200 
feet past the end of the runway (and primary surface) at the same 
elevation as the end of the runway. It continues upward at a slope of 
50:1 (1 foot vertically for each 50 feet horizontally) to an elevation 
of 500 feet above the established airfield elevation. At that point the 
plane becomes horizontal, continuing at that same uniform elevation to a 
point 50,000 feet longitudinally from the beginning of the inclined 
plane (glide angle) and ending there.
    (B) The width of the surface at the beginning of the inclined plane 
(glide angle) is the same as the width of the clear zone. It then flares 
uniformly, reaching the maximum width of 16,000 feet at the end.
    (ii) The approach-departure clearance zone is the ground area under 
the approach-departure clearance surface.
    (iii) The transitional surface is a sideways extension of all 
primary surfaces, clear zones, and approach-departure clearance surfaces 
along inclined planes.
    (A) The inclined plane in each case begins at the edge of the 
surface.
    (B) The slope of the incline plane is 7:1 (1 foot vertically for 
each 7 feet horizontally). It continues to the point of intersection 
with the--
    (1) Inner horizontal surface (which is the horizontal plane 150 feet 
above the established airfield elevation); or
    (2) Outer horizontal surface (which is the horizontal plane 500 feet 
above the established airfield elevation), whichever is applicable.
    (iv) The ``transitional zone'' is the ground area under the 
transitional surface. (It adjoins the primary surface, clear zone, and 
approach-departure clearance zone.)
    (b) General. (1) The Contractor shall comply with the requirements 
of this clause while--
    (i) Operating all ground equipment (mobile or stationary);
    (ii) Placing all materials; and
    (iii) Performing all work, upon and around all airfields.
    (2) The requirements of this clause are in addition to any other 
safety requirements of this contract.
    (c) The Contractor shall--
    (1) Report to the Contracting Officer before initiating any work;
    (2) Notify the Contracting Officer of proposed changes to locations 
and operations;
    (3) Not permit either its equipment or personnel to use any runway 
for purposes other than aircraft operation without permission of the 
Contracting Officer, unless the runway is--
    (i) Closed by order of the Contracting Officer; and
    (ii) Marked as provided in paragraph (d)(2) of this clause;
    (4) Keep all paved surfaces, such as runways, taxiways, and 
hardstands, clean at all times and, specifically, free from small stones 
which might damage aircraft propellers or jet aircraft;
    (5) Operate mobile equipment according to the safety provisions of 
this clause, while actually performing work on the airfield. At all 
other times, the Contractor shall remove all mobile equipment to 
locations--
    (i) Approved by the Contracting Officer;
    (ii) At a distance of at least 750 feet from the runway centerline, 
plus any additional distance; and
    (iii) Necessary to ensure compliance with the other provisions of 
this clause; and

[[Page 517]]

    (6) Not open a trench unless material is on hand and ready for 
placing in the trench. As soon as practicable after material has been 
placed and work approved, the Contractor shall backfill and compact 
trenches as required by the contract. Meanwhile, all hazardous 
conditions shall be marked and lighted in accordance with the other 
provisions of this clause.
    (d) Landing areas. The Contractor shall--
    (1) Place nothing upon the landing areas without the authorization 
of the Contracting Officer;
    (2) Outline those landing areas hazardous to aircraft, using (unless 
otherwise authorized by the Contracting Officer) red flags by day, and 
electric, battery-operated low-intensity red flasher lights by night;
    (3) Obtain, at an airfield where flying is controlled, additional 
permission from the control tower operator every time before entering 
any landing area, unless the landing area is marked as hazardous in 
accordance with paragraph (d)(2) of this clause;
    (4) Identify all vehicles it operates in landing areas by means of a 
flag on a staff attached to, and flying above, the vehicle. The flag 
shall be three feet square, and consist of a checkered pattern of 
international orange and white squares of 1 foot on each side (except 
that the flag may vary up to ten percent from each of these dimensions);
    (5) Mark all other equipment and materials in the landing areas, 
using the same marking devices as in paragraph (d)(2) of this clause; 
and
    (6) Perform work so as to leave that portion of the landing area 
which is available to aircraft free from hazards, holes, piles of 
material, and projecting shoulders that might damage an airplane tire.
    (e) Safety precaution areas. The Contractor shall--
    (1) Place nothing upon the safety precaution areas without 
authorization of the Contracting Officer;
    (2) Mark all equipment and materials in safety precaution areas, 
using (unless otherwise authorized by the Contracting Officer) red flags 
by day, and electric, battery-operated, low-intensity red flasher lights 
by night; and
    (3) Provide all objects placed in safety precaution areas with a red 
light or red lantern at night, if the objects project above the 
approach-departure clearance surface or above the transitional surface.

                             (End of clause)



252.236-7006  Cost limitation.

    As prescribed in 236.570(b)(4), use the following provision:

                       Cost Limitation (JAN 1997)

    (a) Certain items in this solicitation are subject to statutory cost 
limitations. The limitations are stated in the Schedule.
    (b) An offer which does not state separate prices for the items 
identified in the Schedule as subject to a cost limitation may be 
considered nonresponsive.
    (c) Prices stated in offers for items subject to cost limitations 
shall include an appropriate apportionment of all costs, direct and 
indirect, overhead, and profit.
    (d) Offers may be rejected which--
    (1) Are materially unbalanced for the purpose of bringing items 
within cost limitations; or
    (2) Exceed the cost limitations, unless the limitations have been 
waived by the Government prior to award.

                           (End of provision)

[56 FR 36479, July 31, 1991, as amended at 62 FR 2615, Jan. 17, 1997]



252.236-7007  Additive or deductive items.

    As prescribed in 236.570(b)(5), use the following provision:

                 Additive or Deductive Items (Dec. 1991)

    (a) The low offeror and the items to be awarded shall be determined 
as follows--
    (1) Prior to the opening of bids, the Government will determine the 
amount of funds available for the project.
    (2) The low offeror shall be the Offeror that--
    (i) Is otherwise eligible for award; and
    (ii) Offers the lowest aggregate amount for the first or base bid 
item, plus or minus (in the order stated in the list of priorities in 
the bid schedule) those additive or deductive items that provide the 
most features within the funds determined available.
    (3) The Contracting Officer shall evaluate all bids on the basis of 
the same additive or deductive items.
    (i) If adding another item from the bid schedule list of priorities 
would make the award exceed the available funds for all offerors, the 
Contracting Officer will skip that item and go to the next item from the 
bid schedule of priorities; and
    (ii) Add that next item if an award may be made that includes that 
item and is within the available funds.
    (b) The Contracting Officer will use the list of priorities in the 
bid schedule only to determine the low offeror. After determining the 
low offeror, an award may be made on any combination of items if--
    (1) It is in the best interest of the Government;

[[Page 518]]

    (2) Funds are available at the time of award; and
    (3) The low offeror's price for the combination to be awarded is 
less than the price offered by any other responsive, responsible 
offeror.
    (c) Example. The amount available is $100,000. Offeror A's base bid 
and four additives (in the order stated in the list of priorities in the 
bid Schedule) are $85,000, $10,000, $8,000, $6,000, and $4,000. Offeror 
B's base bid and four additives are $80,000, $16,000, $9,000, $7,000, 
and $4,000. Offeror A is the low offeror. The aggregate amount of 
offeror A's bid for purposes of award would be $99,000, which includes a 
base bid plus the first and fourth additives. The second and third 
additives were skipped because each of them would cause the aggregate 
bid to exceed $100,000.

                           (End of provision)



252.236-7008  Contract prices--bidding schedules.

    As prescribed in 236.570(b)(6), use the following provision:

             Contract Prices--Bidding Schedules (Dec. 1991)

    (a) The Government's payment for the items listed in the Bidding 
Schedule shall constitute full compensation to the Contractor for--
    (1) Furnishing all plant, labor, equipment, appliances, and 
materials; and
    (2) Performing all operations required to complete the work in 
conformity with the drawings and specifications.
    (b) The Contractor shall include in the prices for the items listed 
in the Bidding Schedule all costs for work in the specifications, 
whether or not specifically listed in the Bidding Schedule.

                           (End of provision)



252.236-7009  Option for supervision and inspection services.

    As prescribed in 236.609-70, use the following clause:

       Option for Supervision and Inspection Services (Dec. 1991)

    (a) The Government may--
    (1) At its option, direct the Contractor to perform any part or all 
of the supervision and inspection services for the construction contract 
as provided under appendix A of this contract; and
    (2) Exercise its option, by written order, at any time prior to six 
months after satisfactory completion and acceptance of the work under 
this contract.
    (b) Upon receipt of the Contracting Officer's written order, the 
Contractor shall proceed with the supervision and inspection services.

                             (End of clause)



252.236-7010  Overseas Military Construction--Preference for United States Firms.

    As prescribed in 236.570(c), use the following provision:

Overseas Military Construction--Preference for United States Firms (Jan 
                                  1997)

    (a) Definition.
    ``United States firm,'' as used in this provision, means a firm 
incorporated in the United States that complies with the following:
    (1) The corporate headquarters are in the United States;
    (2) The firm has filed corporate and employment tax returns in the 
United States for a minimum of 2 years (if required), has filed State 
and Federal income tax returns (if required) for 2 years, and has paid 
any taxes due as a result of these filings; and
    (3) The firm employs United States citizens in key management 
positions.
    (b) Evaluation. Offers from firms that do not qualify as United 
States firms will be evaluated by adding 20 percent to the offer.
    (c) Status. The offeror ______ is, ______ is not a United States 
firm.

                           (End of provision)

[62 FR 2857, Jan. 17, 1997]



252.236-7011  Overseas Architect-Engineer Services--Restriction to United States Firms.

    As prescribed in 236.609-70(b), use the following provision:

Overseas Architect-Engineer Services--Restriction to United States Firms 
                               (Jan 1997)

    (a) Definition.
    United States firm, as used in this provision, means a firm 
incorporated in the United States that complies with the following:
    (1) The corporate headquarters are in the United States;
    (2) The firm has filed corporate and employment tax returns in the 
United States for a minimum of 12 years (if required), has filed State 
and Federal income tax returns (if required) for 2 years, and has paid 
any taxes due as a result of these filings; and
    (3) The firm employs United States citizens in key management 
positions.
    (b) Restriction. Military construction appropriations acts restrict 
award of a contract, resulting from this solicitation, to a

[[Page 519]]

United States firm or a joint venture of United States and host nation 
firms.
    (c) Status. The offeror confirms, by submission of its offer, that 
it is a United States firm or a joint venture of United States and host 
nation firms.

                           (End of provision)

[62 FR 2858, Jan. 17, 1997]



252.237-7000  Notice of special standards of responsibility.

    As prescribed in 237.203-70(d)(1), use the following provision:

        Notice of Special Standards of Responsibility (Dec. 1991)

    (a) To be determined responsible, the Offeror must meet the general 
standards of responsibility set forth at FAR 9.104-1 and the following 
criteria, as described in Chapter 3, General Standards, of ``Government 
Auditing Standards.''
    (1) Qualifications;
    (2) Independence; and
    (3) Quality Control.
    (b) ``Government Auditing Standards'' is issued by the Comptroller 
General of the United States and is available for sale from the: 
Superintendent of Documents, U.S. Government Printing Office. 
Washington, DC 20401, Stock number 020-000-00243-3.
    (c) The apparently successful Offeror, before award, shall give the 
Contracting Officer evidence that it is licensed by the cognizant 
licensing authority in the state or other political jurisdiction where 
the Offeror operates its professional practice.

                           (End of provision)



252.237-7001  Compliance with audit standards.

    As prescribed in 237.203-70(d)(2), use the following clause:

               Compliance With Audit Standards (Dec. 1991)

    The Contractor, in performance of all audit services under this 
contract, shall comply with--
    (a) Government Auditing Standards set forth in ``Government Auditing 
Standards'' issued by the Comptroller General of the United States.
    (b) Office of Management and Budget Circular No. A-73, Audit of 
Federal Operations and Programs.

                             (End of clause)



252.237-7002  Award to single offeror.

    As prescribed in 237.7004(a), use the following provision:

                   Award to Single Offeror (Dec. 1991)

    (a) Award shall be made to a single offeror.
    (b) Offerors shall include unit prices for each item. Failure to 
include unit prices for each item will be cause for rejection of the 
entire offer.
    (c) The Government will evaluate offers on the basis of the 
estimated quantities shown.
    (d) Award will be made to that responsive, responsible offeror whose 
total aggregate offer is the lowest price to the Government.

                           (End of provision)

                         Alternate I (Dec. 1991)

    As prescribed in 237.7004(a), substitute the following paragraph (d) 
for paragraph (d) of the basic provision:
    (d) Award will be made to that responsive, responsible offeror whose 
total aggregate offer is in the best interest of the Government.



252.237-7003  Requirements.

    As prescribed in 237.7004(b), use the following clause:

                        Requirements (Dec. 1991)

    (a) Except as provided in paragraphs (c) and (d) of this clause, the 
Government will order from the Contractor all of its requirements in the 
area of performance for the supplies and services listed in the schedule 
of this contract.
    (b) Each order will be issued as a delivery order and will list--
    (1) The supplies or services being ordered;
    (2) The quantities to be furnished;
    (3) Delivery or performance dates;
    (4) Place of delivery or performance;
    (5) Packing and shipping instructions;
    (6) The address to send invoices; and
    (7) The funds from which payment will be made.
    (c) The Government may elect not to order supplies and services 
under this contract in instances where the body is removed from the area 
for medical, scientific, or other reason.
    (d) In an epidemic or other emergency, the contracting activity may 
obtain services beyond the capacity of the Contractor's facilities from 
other sources.
    (e) Contracting Officers of the following activities may order 
services and supplies under this contract--

 _______________________________________________________________________


[[Page 520]]

________________________________________________________________________
 _______________________________________________________________________

________________________________________________________________________

                             (End of clause)



252.237-7004  Area of performance.

    As prescribed in 237.7004(b), use the following clause:

                     Area of Performance (Dec. 1991)

    (a) The area of performance is as specified in the contract.
    (b) The Contractor shall take possession of the remains at the place 
where they are located, transport them to the Contractor's place of 
preparation, and later transport them to a place designated by the 
Contracting Officer.
    (c) The Contractor will not be reimbursed for transportation when 
both the place where the remains were located and the delivery point are 
within the area of performance.
    (d) If remains are located outside the area of performance, the 
Contracting Officer may place an order with the Contractor under this 
contract or may obtain the services elsewhere. If the Contracting 
Officer requires the Contractor to transport the remains into the area 
of performance, the Contractor shall be paid the amount per mile in the 
schedule for the number of miles required to transport the remains by a 
reasonable route from the point where located to the boundary of the 
area of performance.
    (e) The Contracting Officer may require the Contractor to deliver 
remains to any point within 100 miles of the area of performance. In 
this case, the Contractor shall be paid the amount per mile in the 
schedule for the number of miles required to transport the remains by a 
reasonable route from the boundary of the area of performance to the 
delivery point.

                             (End of clause)



252.237-7005  Performance and delivery.

    As prescribed in 237.7004(b), use the following clause:

                  Performance and Delivery (Dec. 1991)

    (a) The Contractor shall furnish the material ordered and perform 
the services specified as promptly as possible but not later than 36 
hours after receiving notification to remove the remains, excluding the 
time necessary for the Government to inspect and check results of 
preparation.
    (b) The Government may, at no additional charge, require the 
Contractor to hold the remains for an additional period not to exceed 72 
hours from the time the remains are casketed and final inspection 
completed.

                             (End of clause)



252.237-7006  Subcontracting.

    As prescribed in 237.7004(b), use the following clause:

                       Subcontracting (Dec. 1991)

    The Contractor shall not subcontract any work under this contract 
without the Contracting Officer's written approval. This clause does not 
apply to contracts of employment between the Contractor and its 
personnel.

                             (End of clause)



252.237-7007  Termination for default.

    As prescribed in 237.7004(b), use the following clause:

                   Termination for Default (Dec. 1991)

    (a) This clause supplements and is in addition to the Default clause 
of this contract.
    (b) The Contracting Officer may terminate this contract for default 
by written notice without the ten day notice required by paragraph 
(a)(2) of the Default clause if--
    (1) The Contractor, through circumstances reasonably within its 
control or that of its employees, performs any act under or in 
connection with this contract, or fails in the performance of any 
service under this contract and the act or failures may reasonably be 
considered to reflect discredit upon the Department of Defense in 
fulfilling its responsibility for proper care of remains;
    (2) The Contractor, or its employees, solicits relatives or friends 
of the deceased to purchase supplies or services not under this 
contract. (The Contractor may furnish supplies or arrange for services 
not under this contract, only if representatives of the deceased 
voluntarily request, select, and pay for them.);
    (3) The services or any part of the services are performed by anyone 
other than the Contractor or the Contractor's employees without the 
written authorization of the Contracting Officer;
    (4) The Contractor refuses to perform the services required for any 
particular remains; or
    (5) The Contractor mentions or otherwise uses this contract in its 
advertising in any way.

                             (End of clause)



252.237-7008  Group interment.

    As prescribed in 237.7004(b), use the following clause:

[[Page 521]]

                       Group Interment (Dec. 1991)

    The Government will pay the Contractor for supplies and services 
provided for remains interred as a group on the basis of the number of 
caskets furnished, rather than on the basis of the number of persons in 
the group.

                             (End of clause)



252.237-7009  Permits.

    As prescribed in 237.7004(b), use the following clause:

                           Permits (Dec. 1991)

    The Contractor shall meet all State and local licensing requirements 
and obtain and furnish all necessary health department and shipping 
permits at no additional cost to the Government. The Contractor shall 
ensure that all necessary health department permits are in order for 
disposition of the remains.

                             (End of clause)



252.237-7010  Facility requirements.

    As prescribed in 237.7004(b), use the following clause:

                    Facility Requirements (Dec. 1991)

    (a) The Contractor's building shall have complete facilities for 
maintaining the highest standards of solemnity, reverence, assistance to 
the family, and prescribed ceremonial services.
    (b) The Contractor's preparation room shall be clean, sanitary, and 
adequately equipped.
    (c) The Contractor shall have, or be able to get, catafalques, 
church trucks, and equipment for Protestant, Catholic, and Jewish 
services.
    (d) The Contractor's funeral home, furnishings, grounds, and 
surrounding area shall present a clean and well-kept appearance.

                             (End of clause)



252.237-7011  Preparation history.

    As prescribed in 237.7004(b), use the following clause:

                     Preparation History (Dec. 1991)

    For each body prepared, or for each casket handled in a group 
interment, the Contractor shall state briefly the results of the 
embalming process on a certificate furnished by the Contracting Officer.

                             (End of clause)



252.237-7012  Instruction to offerors (count-of-articles).

    As prescribed in 237.7102(a), use the following provision:

         Instruction to Offerors (Count-of-Articles) (Dec. 1991)

    (a) The Offeror shall include unit prices for each item in a lot. 
Unit prices shall include all costs to the Government of providing the 
services, including pickup and delivery charges.
    (b) Failure to offer on any item in a lot shall be cause for 
rejection of the offer on that lot. The Contracting Officer will 
evaluate offers based on the estimated quantities in the solicitation.
    (c) Award generally will be made to a single offeror for all lots. 
However, the Contracting Officer may award by individual lot when it is 
more advantageous to the Government.
    (d) Prospective offerors may inspect the types of articles to be 
serviced. Contact the Contracting Officer to make inspection 
arrangements.

                           (End of provision)



252.237-7013  Instruction to offerors (bulk weight).

    As prescribed in 237.7102(b), use the following provision:

            Instruction to Offerors (Bulk Weight) (Dec. 1991)

    (a) Offers shall be submitted on a unit price per pound of serviced 
laundry. Unit prices shall include all costs to the Government of 
providing the service, including pickup and delivery charges.
    (b) The Contracting Officer will evaluate bids based on the 
estimated pounds of serviced laundry stated in the solicitation.
    (c) Award generally will be made to a single offeror for all lots. 
However, the Contracting Officer may award by individual lot when it is 
more advantageous to the Government.
    (d) Prospective offerors may inspect the types of articles to be 
serviced. Contact the Contracting Officer to make inspection 
arrangements.

                           (End of provision)



252.237-7014  Loss or damage (count-of-articles).

    As prescribed in 237.7102(c), use the following clause:

[[Page 522]]

             Loss or Damage (Count-of-Articles) (Dec. 1991)

    (a) The count-of-articles will be--
    (1) The count of the Contracting Officer; or
    (2) The count agreed upon as a result of a joint count by the 
Contractor and the Contracting Officer at the time of delivery to the 
Contractor.
    (b) The Contractor shall--
    (1) Be liable for return of the number and kind of articles 
furnished for service under this contract; and
    (2) Shall indemnify the Government for any loss or damage to such 
articles.
    (c) The Contractor shall pay to the Government the value of any lost 
or damaged property using Federal supply schedule price lists. If the 
property is not on these price lists, the Contracting Officer shall 
determine a fair and reasonable price.
    (d) The Contracting Officer will allow credit for any depreciation 
in the value of the property at the time of loss or damage. The 
Contracting Officer and the Contractor shall mutually determine the 
amount of the allowable credit.
    (e) Failure to agree upon the value of the property or on the amount 
of credit due will be treated as a dispute under the Disputes clause of 
this contract.
    (f) In case of damage to any property that the Contracting Officer 
and the Contractor agree can be satisfactorily repaired, the Contractor 
may repair the property at its expense in a manner satisfactory to the 
Contracting Officer, rather than make payment under paragraph (c) of 
this clause.

                             (End of clause)



252.237-7015  Loss or damage (weight of articles).

    As prescribed in 237.7102(d), use the following clause:

             Loss or Damage (Weight of Articles) (Dec. 1991)

    (a) The Contractor shall--
    (1) Be liable for return of the articles furnished for service under 
this contract; and
    (2) Indemnify the Government for any articles delivered to the 
Contractor for servicing under this contract that are lost or damaged, 
and in the opinion of the Contracting Officer, cannot be repaired 
satisfactorily.
    (b) The Contractor shall pay to the Government ________ per pound 
for lost or damaged articles. The Contractor shall pay the Government 
only for losses which exceed the maximum weight loss in paragraph (e) of 
this clause.
    (c) Failure to agree on the amount of credit due will be treated as 
a dispute under the Disputes clause of this contract.
    (d) In the case of damage to any articles that the Contracting 
Officer and the Contractor agree can be satisfactorily repaired, the 
Contractor shall repair the articles at its expense in a manner 
satisfactory to the Contracting Officer.
    (e) The maximum weight loss allowable in servicing the laundry is 
________ percent of the weight recorded on delivery tickets when the 
laundry is picked up. Any weight loss in excess of this amount shall be 
subject to the loss provisions of this clause.

                             (End of clause)



252.237-7016  Delivery tickets.

    As prescribed in 237.7102(e), use the following clause:

                      Delivery Tickets (Dec. 1991)

    (a) The Contractor shall complete delivery tickets in the number of 
copies required and in the form approved by the Contracting Officer, 
when it receives the articles to be serviced.
    (b) The Contractor shall include one copy of each delivery ticket 
with its invoice for payment.

                             (End of clause)

                         Alternate I (Dec. 1991)

    As prescribed in 237.7102(e)(1), add the following paragraphs (c), 
(d), and (e) to the basic clause:

    (c) Before the Contractor picks up articles for service under this 
contract, the Contracting Officer will ensure that--
    (1) Each bag contains only articles within a single bag type as 
specified in the schedule; and
    (2) Each bag is weighed and the weight and bag type are identified 
on the bag.
    (d) The Contractor shall, at time of pickup--
    (1) Verify the weight and bag type and record them on the delivery 
ticket; and
    (2) Provide the Contracting Officer, or representative, a copy of 
the delivery ticket.
    (e) At the time of delivery, the Contractor shall record the weight 
and bag type of serviced laundry on the delivery ticket. The Contracting 
Officer will ensure that this weight and bag type are verified at time 
of delivery.

                        Alternate II (Dec. 1991)

    As prescribed in 237.7102(e)(2), add the following paragraphs (c), 
(d), and (e) to the basic clause--

    (c) Before the Contractor picks up articles for service under this 
contract, the Contracting Officer will ensure that each bag is weighed 
and that the weight is identified on the bag.
    (d) The Contractor, at time of pickup, shall verify and record the 
weight on the delivery

[[Page 523]]

ticket and shall provide the Contracting Officer, or representative, a 
copy of the delivery ticket.
    (e) At the time of delivery, the Contractor shall record the weight 
of serviced laundry on the delivery ticket. The Contracting Officer will 
ensure that this weight is verified at time of delivery.



252.237-7017  Individual laundry.

    As prescribed in 237.7102(f), use the following clause:

                     Individual Laundry (Dec. 1991)

    (a) The Contractor shall provide laundry service under this contract 
on both a unit bundle and on a piece-rate bundle basis for individual 
personnel.
    (b) The total number of pieces listed in the ``Estimated Quantity'' 
column in the schedule is the estimated amount of individual laundry for 
this contract. The estimate is for information only and is not a 
representation of the amount of individual laundry to be ordered. 
Individuals may elect whether or not to use the laundry services.
    (c) Charges for individual laundry will be on a per unit bundle or a 
piece-rate basis. The Contractor shall provide individual laundry bundle 
delivery tickets for use by the individuals in designating whether the 
laundry is a unit bundle or a piece-rate bundle. An individual laundry 
bundle will be accompanied by a delivery ticket listing the contents of 
the bundle.
    (d) The maximum number of pieces to be allowed per bundle is as 
specified in the schedule and as follows--
    (1) Bundle consisting of 26 pieces, including laundry bag. This 
bundle will contain approximately ________ pieces of outer garments 
which shall be starched and pressed. Outer garments include, but are not 
limited to, shirts, trousers, jackets, dresses, and coats.
    (2) Bundle consisting of 13 pieces, including laundry bag. This 
bundle will contain approximately ________ pieces of outer garments 
which shall be starched and pressed. Outer garments include, but are not 
limited to, shirts, trousers, jackets, dresses, and coats.

                             (End of clause)



252.237-7018  Special definitions of government property.

    As prescribed in 237.7102(g), use the following clause:

         Special Definitions of Government Property (Dec. 1991)

    Articles delivered to the Contractor to be laundered or dry-cleaned, 
including any articles which are actually owned by individual Government 
personnel, are Government-owned property, not Government-furnished 
property. Government-owned property does not fall under the requirements 
of any Government-furnished property clause of this contract.

                             (End of clause)



252.237-7019  Identification of uncompensated overtime.

    As prescribed in 237.170-3, use the following provision:

          Identification of Uncompensated Overtime (Apr. 1992)

    (a) Definitions. As used in this provision--
    (1) Uncompensated overtime means the hours worked in excess of an 
average of 40 hours per week by direct charge employees who are exempt 
from the Fair Labor Standards Act (FLSA), without additional 
compensation. Compensated personal absences, such as holidays, 
vacations, and sick leave, shall be included in the normal work week for 
purposes of computing uncompensated overtime hours.
    (2) Uncompensated overtime rate is the rate which results from 
multiplying the hourly rate for a 40 hour work week by 40, and then 
dividing by the proposed hours per week. For example, 45 hours proposed 
on a 40 hour work week basis at $20.00 would be converted to an 
uncompensated overtime rate of $17.78 per hour. ($20  x  40) divided by 
45=$17.78.
    (b) For any hours proposed against which an uncompensated overtime 
rate is applied, the Offeror shall identify in its proposal the hours in 
excess of an average of 40 hours per week, at the same level of detail 
as compensated hours, and the uncompensated overtime rate per hour, 
whether at the prime or subcontract level. This includes uncompensated 
overtime hours that are in indirect cost pools for personnel whose 
regular hours are normally charged direct.
    (c) The Offeror's accounting practices used to estimate 
uncompensated overtime must be consistent with its cost accounting 
practices used to accumulate and report uncompensated overtime hours.
    (d) Proposals which include unrealistically low labor rates, or 
which do not otherwise demonstrate cost realism, will be considered in a 
risk assessment and evaluated for award in accordance with that 
assessment.
    (e) The Offeror shall include a copy of its policy addressing 
uncompensated overtime with its proposal.

                           (End of provision)

[56 FR 67222, Dec. 30, 1991, as amended at 57 FR 14996, Apr. 23, 1992; 
57 FR 42633, Sept. 15, 1992]

[[Page 524]]



252.237-7020--252.237-7021  [Reserved]



252.237-7022  Services at installations being closed.

    As prescribed in 237.7402, use the following clause:

            Services at Installations Being Closed (May 1995)

    Professional employees shall be used by the local government to 
provide services under this contract to the extent that professionals 
are available in the area under the jurisdiction of such government.

                             (End of clause)

[59 FR 36090, July 15, 1994, as amended at 60 FR 29503, June 5, 1995]



252.239-7000  Protection against compromising emanations.

    As prescribed in 239.7102-3(a), use the following clause:

         Protection Against Compromising Emanations (Dec. 1991)

    (a) The Contractor shall provide or use only computer equipment, as 
specified by the Government, that has been accredited to meet the 
appropriate security requirements of--
    (1) The National Security Agency National TEMPEST Standards (NACSEM 
No. 5100 or NACSEM No. 5100A, Compromising Emanations Laboratory Test 
Standard, Electromagnetics (U)); or
    (2) Other standard specified by this contract.
    (b) Upon request of the Contracting Officer, the Contractor shall 
provide documentation supporting the accreditation.
    (c) The Government may, as part of its inspection and acceptance, 
conduct additional tests to ensure that equipment or systems delivered 
under this contract satisfy the security standards specified. The 
Government may conduct additional tests--
    (1) At the installation site or contractor's facility.
    (2) Notwithstanding the existence of valid accreditations of 
equipment prior to the award of this contract.
    (d) Unless otherwise provided in this contract under the Warranty of 
Supplies or Warranty of Systems and Equipment clauses, the Contractor 
shall correct or replace accepted equipment or systems found to be 
deficient within one year after proper installations.
    (1) The correction or replacement shall be at no cost to the 
Government.
    (2) Should a modification to the delivered equipment be made by the 
Contractor, the one year period applies to the modification upon its 
proper installation.
    (3) This paragraph (d) applies regardless of f.o.b. point or the 
point of acceptance of the deficient equipment/systems.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 56 FR 67222, Dec. 30, 1991]



52.239-7001  [Reserved]



252.239-7002  Access.

    As prescribed in 239.7411(a), use the following clause:

                           Access (Dec. 1991)

    (a) Subject to military security regulations, the Government shall 
permit the Contractor access at all reasonable times to Contractor 
furnished facilities. However, if the Government is unable to permit 
access, the Government at its own risk and expense shall maintain these 
facilities and the Contractor shall not be responsible for the service 
involving any of these facilities during the period of nonaccess, unless 
the service failure results from the Contractor's fault or negligence.
    (b) During periods when the Government does not permit Contractor 
access, the Government will reimburse the Contractor at mutually 
acceptable rates for the loss of or damage to the equipment due to the 
fault or negligence of the Government. Failure to agree shall be a 
dispute concerning a question of fact within the meaning of the Disputes 
clause of this contract.

                             (End of clause)



252.239-7003  Facilities and services to be furnished--common carriers.

    As prescribed in 239.7411(a), use the following clause:

  Facilities and Services To Be Furnished--Common Carriers (Dec. 1991)

    (a) The Contractor shall furnish any classes of services or 
facilities that the Contractor offers or furnishes under published 
tariffs.
    (b) When it is mutually agreed that the Contractor shall furnish 
nontariffed services, the Government shall order them under the Ordering 
of Facilities and Services clause of this agreement/contract. These 
nontariffed services may include the engineering, installation, 
alteration, or maintenance of facilities owned either by the Contractor 
or the Government, wherever located.

[[Page 525]]

    (c) Upon request of the Contracting Officer, the Contractor agrees 
to interconnect its facilities with any Government-owned or furnished 
telecommunications equipment, facilities, or transmission media. The 
Contractor shall use established technical criteria for ensuring 
continuity of service and traffic without damage to or degradation of 
commercial facilities.

                             (End of clause)



252.239-7004  Orders for facilities and services--common carriers.

    As prescribed in 239.7411(a), use the following clause:

     Orders for Facilities and Services--Common Carriers (Dec. 1991)

    The Contractor shall acknowledge a communication service 
authorization or other type order for supplies and facilities by--
    (a) Commencing performance; or
    (b) Written acceptance by a duly authorized representative.

                             (End of clause)



252.239-7005  Rates, charges, and services--common carriers.

    As prescribed in 239.7411(a), use the following clause:

        Rates, Charges, and Services--Common Carriers (Dec. 1991)

    (a) Definition--Governmental regulatory body means the Federal 
Communications Commission, any statewide regulatory body, or any body 
with less than statewide jurisdiction when operating under the state 
authority. Regulatory bodies whose decisions are not subject to judicial 
appeal and regulatory bodies which regulate a company owned by the same 
entity which creates the regulatory body are not ``governmental 
regulatory bodies.''
    (b) The Contractor shall furnish the services and facilities under 
this agreement/contract in accordance with--
    (1) All applicable tariffs, rates, charges, rules, regulations, or 
requirements;
    (i) Lawfully established by a governmental regulatory body; and
    (ii) Applicable to service and facilities furnished or offered by 
the Contractor to the general public or the Contractor's subscribers;
    (2) Rates, terms, and conditions of service and facilities furnished 
or offered by the Contractor to the general public or the Contractor's 
subscribers; or
    (3) Rates, terms, and conditions of service as may be agreed upon, 
subject, when appropriate, to jurisdiction of a governmental regulatory 
body.
    (c) The Government shall not prepay for services.
    (d) For nontariffed services, the Contractor shall charge the 
Government at the lowest rate and under the most favorable terms and 
conditions for similar service and facilities offered to any other 
customer.
    (e) Recurring charges for services and facilities shall, in each 
case, start with the satisfactory beginning of service or provision of 
facilities or equipment and are payable monthly in arrears.
    (f) Subject to the Cancellation or Termination of Orders--Common 
Carriers clause, of this agreement/contract, the Government may stop the 
use of any service or facilities furnished under this agreement/contract 
at any time. The Government shall pay the contractor all charges for 
services and facilities adjusted to the effective date of 
discontinuance.
    (g) Expediting charges are costs necessary to get services earlier 
than normal. Examples are overtime pay or special shipment. When 
authorized, expediting charges shall be the additional costs incurred by 
the Contractor and the subcontractor. The Government shall pay 
expediting charges only when--
    (1) They are provided for in the tariff established by a 
governmental regulatory body; or
    (2) They are authorized in a communication service authorization or 
other contractual document.
    (h) When services normally provided are technically unacceptable and 
the development, fabrication, or manufacture of special equipment is 
required, the Government may--
    (1) Provide the equipment; or
    (2) Direct the Contractor to acquire the equipment or facilities. If 
the Contractor acquires the equipment or facilities, the acquisition 
shall be competitive, if practicable.
    (i) If at any time the Government defers or changes its orders for 
any of the services but does not cancel or terminate them, the amount 
paid or payable to the Contractor for the services deferred or modified 
shall be equitably adjusted under applicable tariffs filed by the 
Contractor with the regulatory commission in effect at the time of 
deferral or change. If no tariffs are in effect, the Government and the 
Contractor shall equitably adjust the rates by mutual agreement. Failure 
to agree on any adjustment shall be a dispute concerning a question of 
fact within the meaning of the Disputes clause of this contract.

                             (End of clause)



252.239-7006  Tariff information.

    As prescribed in 239.7411(a), use the following clause:

[[Page 526]]

                      Tariff Information (Jul 1997)

    (a) The Contractor shall provide to the Contracting Officer--
    (1) Upon request, a copy of the Contractor's current existing 
tariffs (including changes);
    (2) Before filing, any application to a Federal, State, or any other 
regulatory agency for new or changes to, rates, charges, services, or 
regulations relating to any tariff or any of the facilities or services 
to be furnished solely or primarily to the Government; and
    (3) Upon request, a copy of all information, material, and data 
developed or prepared in support of or in connection with an application 
under paragraph (a)(2) of this clause.
    (b) The Contractor shall notify the Contracting Officer of any 
application that anyone other than the Contractor files with a 
governmental regulatory body which affects or will affect the rate or 
conditions of services under this agreement/contract. These requirements 
also apply to applications pending on the effective date of this 
agreement/contract.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 62 FR 40473, July 29, 1997]



252.239-7007  Cancellation or termination of orders--common carriers.

    As prescribed in 239.7411(a), use the following clause:

    Cancellation or Termination of Orders--Common Carriers (JAN 1997)

    (a) If the Government cancels any of the services ordered under this 
agreement/contract, before the services are made available to the 
Government, or terminates any of these services after they are made 
available to the Government, the Government shall reimburse the 
Contractor for the actual nonrecoverable costs the Contractor has 
reasonably incurred in providing facilities and equipment for which the 
Contractor has no foreseeable reuse.
    (b) The amount of the Government's liability upon cancellation or 
termination of any of the services ordered under this agreement/contract 
will be determined under applicable tariffs governing cancellation and 
termination charges which--
    (1) Are filed by the Contractor with a governmental regulatory body, 
as defined in the Rates, Charges, and Services--Common Carriers clause 
of this agreement/contract;
    (2) Are in effect on the date of termination; and
    (3) Provide specific cancellation or termination charges for the 
facilities and equipment involved or show how to determine the charges.
    (c) The amount of the Government's liability upon cancellation or 
termination of any of the services ordered under this agreement/
contract, which are not subject to a governmental regulatory body, will 
be determined under a mutually agreed schedule in the communication 
services authorization (CSA) or other contractual document.
    (d) If no applicable tariffs are in effect on the date of 
cancellation or termination or set forth in the applicable CSA or other 
contractual document, the Government's liability will be determined 
under the following settlement procedures--
    (1) The Contractor agrees to provide the Contracting Officer, in 
such reasonable detail as the Contracting Officer may require, inventory 
schedules covering all items of property or facilities in the 
Contractor's possession, the cost of which is included in the Basic 
Cancellation or Termination Liability for which the Contractor has no 
foreseeable reuse.
    (2) The Contractor shall use its best efforts to sell property or 
facilities when the Contractor has no foreseeable reuse or when the 
Government has not exercised its option to take title under the title to 
Telecommunications Facilities and Equipment clause of this agreement/
contract. The Contractor shall apply any proceeds of the sale to reduce 
any payments by the Government to the Contractor under a cancellation or 
termination settlement.
    (3) The Contractor shall record actual nonrecoverable costs under 
established accounting procedures prescribed by the cognizant 
governmental regulatory authority or, if no such procedures have been 
prescribed, under generally accepted accounting procedures applicable to 
the provision of telecommunication services for public use.
    (4) The actual nonrecoverable costs are the installed costs of the 
facilities and equipment, less cost of reusable materials, and less net 
salvage value. Installed costs shall include the actual cost of 
equipment and materials specifically provided or used, plus the actual 
cost of installing (including engineering, labor, supervision, 
transportation, rights-of-way, and any other items which are chargeable 
to the capital accounts of the Contractor) less any costs the Government 
may have directly reimbursed the Contractor under the Special 
Construction and Equipment Charges clause of this agreement/contract. 
Deduct from the Contractor's installed cost, the net salvage value 
(salvage value less cost of removal). In determining net salvage value, 
give consideration to foreseeable reuse of the facilities and equipment 
by the Contractor. Make allowance for the cost of dismantling, removal, 
reconditioning, and disposal of the facilities and equipment when 
necessary either to the sale of facilities

[[Page 527]]

or their reuse by the Contractor in another location.
    (5) The Basic Cancellation Liability is defined as the actual 
nonrecoverable cost which the Government shall reimburse the Contractor 
at the time services are cancelled. The Basic Termination Liability is 
defined as the nonrecoverable cost amortized in equal monthly increments 
throughout the liability period. Upon termination of services, the 
Government shall reimburse the Contractor for the nonrecoverable cost 
less such costs amortized to the date services are terminated. Establish 
the liability period as mutually agreed to but not to exceed ten years.
    (6) When the Basic Cancellation or Termination Liability established 
by the CSA or other contractual document is based on estimated costs, 
the Contractor agrees to settle on the basis of actual cost at the time 
of termination or cancellation.
    (7) The Contractor agrees that, if after settlement but within the 
termination liability period of the services, should the Contractor make 
reuse of equipment or facilities which were treated as nonreusable or 
nonsalvagable in the settlement, the Contractor shall reimburse the 
Government for the value of the equipment or facilities.
    (8) The Contractor agrees to exclude--
    (i) Any costs which are not included in determining cancellation and 
termination charges under the Contractor's standard practices or 
procedures; and
    (ii) Charges not ordinarily made by the Contractor for similar 
facilities or equipment, furnished under similar circumstances.
    (e) The Government may, under such terms and conditions as it may 
prescribe, make partial payments and payments on account against costs 
incurred by the Contractor in connection with the canceled or terminated 
portion of this agreement/contract. The Government may make these 
payments if in the opinion of the Contracting Officer the total of the 
payments is within the amount the Contractor is entitled. If the total 
of the payments is in excess of the amount finally agreed or determined 
to be due under this clause, the Contractor shall pay the excess to the 
Government upon demand.
    (f) Failure to agree shall be a dispute concerning a question of 
fact within the meaning of the Disputes clause.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 62 FR 2615, Jan. 17, 1997]



252.239-7008  Reuse arrangements.

    As prescribed in 239.7411(a), use the following clause:

                     Reuse Arrangements (Dec. 1991)

    (a) When feasible, the Contractor shall reuse canceled or terminated 
facilities or equipment to minimize the charges to the Government.
    (b) If at any time the Government requires that telecommunications 
facilities or equipment be relocated within the Contractor's service 
area, the Government shall have the option of paying the costs of 
relocating the facilities or equipment in lieu of paying any termination 
or cancellation charge under the Cancellation or Termination of Orders-
Common Carriers clause of this agreement/contract. The Basic Termination 
Liability applicable to the facilities or equipment in their former 
location shall continue to apply to the facilities and equipment in 
their new location. Monthly rental charges shall continue to be paid 
during the period.
    (c) When there is another requirement or foreseeable reuse in place 
of canceled or terminated facilities or equipment, no charge shall apply 
and the Basic Cancellation or Termination Liability shall be 
appropriately reduced. When feasible, the Contractor shall promptly 
reuse discontinued channels or facilities, including equipment for which 
the Government is obligated to pay a minimum service charge.

                             (End of clause)



252.239-7009--252.239-7010  [Reserved]



252.239-7011  Special construction and equipment charges.

    As prescribed in 239.7411(b), use the following clause:

         Special Construction and Equipment Charges (Dec. 1991)

    (a) The Government will not directly reimburse the Contractor for 
the cost of constructing any facilities or providing any equipment, 
unless the Contracting Officer authorizes direct reimbursement.
    (b) If the Contractor stops using facilities or equipment which the 
Government has, in whole or part, directly reimbursed, the Contractor 
shall allow the Government credit for the value of the facilities or 
equipment attributable to the Government's contribution. Determine the 
value of the facilities and equipment on the basis of their foreseeable 
reuse by the Contractor at the time their use is discontinued or on the 
basis of the net salvage value, whichever is greater. The Contractor 
shall promptly pay the Government the amount of any credit.
    (c) The amount of the direct special construction charge shall not 
exceed--
    (1) The actual costs to the Contractor; and
    (2) An amount properly allocable to the services to be provided to 
the Government.

[[Page 528]]

    (d) The amount of the direct special construction charge shall not 
include costs incurred by the Contractor which are covered by--
    (1) A cancellation or termination liability; or
    (2) The Contractor's recurring or other nonrecurring charges.
    (e) The Contractor represents that--
    (1) Recurring charges for the services, facilities, and equipment do 
not include in the rate base any costs that have been reimbursed by the 
Government to the Contractor; and
    (2) Depreciation charges are based only on the cost of facilities 
and equipment paid by the Contractor and not reimbursed by the 
Government.
    (f) If it becomes necessary for the Contractor to incur costs to 
replace any facilities or equipment, the Government shall assume those 
costs or reimburse the Contractor for replacement costs at mutually 
acceptable rates under the following circumstances--
    (1) The Government paid direct special construction charges; or
    (2) The Government reimbursed the Contractor for those facilities or 
equipment as a part of the recurring charges; and
    (3) The need for replacement was due to circumstances beyond the 
control and without the fault of the Contractor.
    (g) Before incurring any costs under paragraph (f) of this clause, 
the Government shall have the right to terminate the service under the 
Cancellation or Termination of Orders clause of this contract.

                             (End of clause)



252.239-7012  Title to telecommunication facilities and equipment.

    As prescribed in 239.7411(b), use the following clause:

     Title to Telecommunication Facilities and Equipment (Dec. 1991)

    (a) Title to all Contractor furnished facilities and equipment used 
under this agreement/contract shall remain with the Contractor even if 
the Government paid the costs of constructing the facilities or 
equipment. A mutually accepted communications service authorization may 
provide for exceptions.
    (b) The Contractor shall operate and maintain all telecommunication 
facilities and equipment used under this agreement/contract whether the 
Government or the Contractor has title.

                             (End of clause)



252.239-7013  Obligation of the Government.

    As prescribed in 239.7411(c), use the following clause:

                Obligation of the Government (Dec. 1991)

    (a) This basic agreement is not a contract. The Government incurs no 
monetary liability under this agreement.
    (b) The Government incurs liability only upon issuance of a 
communications service authorization under the terms of this agreement.

                             (End of clause)



252.239-7014  Term of agreement.

    As prescribed in 239.7411(c), use the following clause:

                      Term of Agreement (Dec. 1991)

    (a) This agreement shall continue in force from year to year, unless 
terminated by either party by 60 days written notice.
    (b) Termination of this agreement does not cancel any communication 
service authorizations previously issued.

                             (End of clause)



252.239-7015  Continuation of communication service authorizations.

    As prescribed in 239.7411(c), use the following clause:

     Continuaton of Communication Service Authorizations (Dec. 1991)

    (a) All communication service authorizations (CSAs) issued by ______ 
under Basic Agreement Number ____, dated ____ , are transferred to this 
basic agreement. The CSAs shall continue in full force and effect as 
though placed under this agreement.

    (b) Communication service authorizations currently in effect which 
were issued by the activity in paragraph (a) of this clause under other 
agreements with the Contractor may also be transferred to this 
agreement.

                             (End of clause)



252.239-7016  Telecommunications security equipment, devices, techniques, and services.

    As prescribed in 239.7411(d), use the following clause:

[[Page 529]]

Telecommunications Security Equipment, Devices, Techniques, and Services 
                               (Dec. 1991)

    (a) Definitions. As used in this clause--
    (1) Securing means the application of Government-approved 
telecommunications security equipment, devices, techniques, or services 
to contractor telecommunications systems.
    (2) Sensitive information means any information the loss, misuse, or 
modification of which, or unauthorized access to, could adversely affect 
the national interest or the conduct of Federal programs, or the privacy 
to which individuals are entitled under 5 U.S.C. 552a (the Privacy Act), 
but which has not been specifically authorized under criteria 
established by an Executive Order or Act of Congress to be kept secret 
in the interest of national defense or foreign policy.
    (3) Telecommunications systems means voice, record, and data 
communications, including management information systems and local data 
networks that connect to external transmission media, when employed by 
Government agencies, contractors, and subcontractors to transmit--
    (i) Classified or sensitive information;
    (ii) Matters involving intelligence activities, cryptologic 
activities related to national security, the command and control of 
military forces, or equipment that is an integral part of a weapon or 
weapons system; or
    (iii) Matters critical to the direct fulfillment of military or 
intelligence missions.
    (b) This solicitation/contract identifies classified or sensitive 
information that requires securing during telecommunications and 
requires the Contractor to secure telecommunications systems. The 
Contractor agrees to secure information and systems at the following 
location: (Identify the location.)
    (c) To provide the security, the Contractor shall use Government-
approved telecommunications equipment, devices, techniques, or services. 
A list of the approved equipment, etc. may be obtained from (identify 
where list can be obtained). Equipment, devices, techniques, or services 
used by the Contractor must be compatible or interoperable with (list 
and identify the location of any telecommunications security equipment, 
device, technique, or service currently being used by the technical or 
requirements organization or other offices with which the Contractor 
must communicate).
    (d) Except as may be provided elsewhere in this contract, the 
Contractor shall furnish all telecommunications security equipment, 
devices, techniques, or services necessary to perform this contract. The 
Contractor must meet ownership eligibility conditions for communications 
security equipment designated as controlled cryptographic items.
    (e) The Contractor agrees to include this clause, including this 
paragraph (e), in all subcontracts which require securing 
telecommunications.

                             (End of clause)



252.241-7000  Superseding contract.

    As prescribed in 241.007-70(a), use the following clause:

                    Superseding Contract (Dec. 1991)

    This contract supersedes contract No. ______, dated ____ which 
provided similar services. Any capital credits accrued to the 
Government, any remaining credits due to the Government under the 
connection charge, or any termination liability are transferred to this 
contract, as follows:

                             Capital Credits

    (List years and accrued credits by year and separate delivery 
points.)

                  Outstanding Connection Charge Credits

    (List by month and year the amount credited and show the remaining 
amount of outstanding credits due the Government.)

                      Termination Liability Charges

    (List by month and year the amount of monthly facility cost 
recovered and show the remaining amount of facility cost to be 
recovered.)

                             (End of clause)



252.241-7001  Government access.

    As prescribed in 241.007-70(b), use the following clause:

                      Government Access (Dec. 1991)

    Authorized representatives of the Government may have access to the 
Contractor's on-base facilities upon reasonable notice or in case of 
emergency.

                             (End of clause)



252.242-7000  Postaward conference.

    As prescribed in 242.570, use the following clause:

                    Postaward Conference (Dec. 1991)

    The Contractor agrees to attend any postaward conference convened by 
the contracting activity or contract administration office in accordance 
with Federal Acquisition Regulation subpart 42.5.

[[Page 530]]

                             (End of clause)



252.242-7001--252.242-7002  [Reserved]



252.242-7003  Application for U.S. government shipping documentation/instructions.

    As prescribed in 242.1404-2-70, use the following clause:

  Application for U.S. Government Shipping Documentation/Instructions 
                               (Dec. 1991)

    The Contractor shall request Government bills of lading by 
submitting a DD Form 1659, Application for U.S. Government Shipping 
Documentation/Instructions, to the--
    (a) Transportation Officer, if named in the contract schedule; or
    (b) Contract administration office.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 62 FR 34135, June 24, 1997]



252.242-7004  Material management and accounting system.

    As prescribed in 242.7206, use the following clause:

          Material Management and Accounting System (SEP 1996)

    (a) Definitions. As used in this clause--
    (1) Material management and accounting system means the Contractor's 
system or systems for planning, controlling, and accounting for the 
acquisition, use, issuing, and disposition of material. Material 
management and accounting systems may be manual or automated. They may 
be stand-alone systems or they may be integrated with planning, 
engineering, estimating, purchasing, inventory, accounting, or other 
systems.
    (2) Valid time-phased requirements means material which is--
    (i) Needed to fulfill the production plan, including reasonable 
quantities for scrap, shrinkage, yield, etc.; and
    (ii) Charged/billed to contracts or other cost objectives in a 
manner consistent with the need to fulfill the production plan.
    (3) Contractor means a business unit as defined in section 31.001 of 
the Federal Acquisition Regulation (FAR).
    (b) General. The Contractor agrees to--
    (1) Maintain a material management and accounting system (MMAS) 
that--
    (i) Reasonably forecasts material requirements;
    (ii) Ensures that costs of purchased and fabricated material charged 
or allocated to a contract are based on valid time-phased requirements; 
and
    (iii) Maintains a consistent, equitable, and unbiased logic for 
costing of material transactions.
    (2) Assess its MMAS and take reasonable action to comply with the 
MMAS standards in paragraph (f) of this clause.
    (c) Applicability. Paragraphs (d) and (e) of this clause apply only 
if the Contractor--
    (1) Is a large business; and
    (2) Received, in its fiscal year preceding award of this contract, 
Department of Defense prime contracts or subcontracts, and their 
modifications totaling--
    (i) $70 million or more; or
    (ii) $30 million or more (but less than $70 million), and is 
notified in writing by the Contracting Officer that paragraphs (d) and 
(e) apply.
    (d) Disclosure, demonstration, and maintenance requirements. (1) The 
Contractor shall--
    (i) Disclose its MMAS to the Administrative Contracting Officer in 
writing; and
    (ii) If requested by the Administrative Contracting Officer, 
demonstrate that the MMAS conforms to the standards in paragraph (f) of 
this clause.
    (2) An MMAS disclosure is adequate when the Contractor has provided 
the Administrative Contracting Officer with documentation which--
    (i) Accurately describes those policies, procedures, and practices 
that the Contractor currently uses in its MMAS; and
    (ii) Provides sufficient detail for the Government to reasonably 
make an informed judgment regarding the adequacy of the MMAS.
    (3) An MMAS demonstration is adequate when the Contractor has 
provided the Administrative Contracting Officer--
    (i) Sufficient evidence to demonstrate the degree of compliance of 
its MMAS with the standards at paragraph (f) of this clause; and
    (ii) Identification of any significant deficiencies, the estimated 
cost impact of the deficiency, and a comprehensive corrective action 
plan.
    (4) The Contractor shall disclose significant changes in its MMAS to 
the Administrative Contracting Officer within 30 days of implementation.
    (5) If the contractor desires the Government to protect such 
information as privileged or confidential, the Contractor shall--
    (i) Notify the Government representative to whom the information is 
submitted, i.e., the ACO, or the auditor; and
    (ii) Ensure an appropriate legend is on the face of the document(s) 
at the time of submission.
    (e) Deficiencies. (1) If the Contractor receives a report which 
identifies deficiencies in its MMAS, the Contractor agrees to respond as 
follows--
    (i) If the Contractor agrees with the report findings and 
recommendations, the Contractor shall--

[[Page 531]]

    (A) Within 30 days, state its agreement in writing; and
    (B) Within 60 days, correct the deficiencies or submit a corrective 
action plan.
    (ii) If the Contractor disagrees with the report findings and 
recommendations, the Contractor shall, within 30 days, state its 
rationale for each area of disagreement.
    (2) The Administrative Contracting Officer shall evaluate the 
Contractor's response and notify the Contractor of the--
    (i) Determination concerning remaining deficiencies;
    (ii) Adequacy of any proposed or completed corrective action plan; 
and
    (iii) Need for any new or revised corrective action plan.
    (f) MMAS standards. MMAS systems shall have adequate internal 
accounting and administrative controls to ensure system and data 
integrity, and comply with the following:
    (1) Have an adequate system description including policies, 
procedures, and operating instructions which comply with the Federal 
Acquisition Regulation and Defense FAR Supplement;
    (2) Ensure that costs of purchased and fabricated material charged 
or allocated to a contract are based on valid time-phased requirements 
as impacted by minimum/economic order quantity restrictions--
    (i) A 98 percent bill of material accuracy and a 95 percent master 
production schedule accuracy are desirable as a goal in order to ensure 
that requirements are both valid and appropriately time-phased.
    (ii) If systems have accuracy levels below these, the Contractor 
shall demonstrate that--
    (A) There is no material harm to the Government due to lower 
accuracy levels; and
    (B) The cost to meet the accuracy goals is excessive in relation to 
the impact on the Government;
    (3) Provide a mechanism to identify, report, and resolve system 
control weaknesses and manual override. Systems should identify 
operational exceptions such as excess/residual inventory as soon as 
known;
    (4) Provide audit trails and maintain records (manual and those in 
machine readable form) necessary to evaluate system logic and to verify 
through transaction testing that the system is operating as desired;
    (5) Establish and maintain adequate levels of record accuracy, and 
include reconciliation of recorded inventory quantities to physical 
inventory by part number on a periodic basis. A 95 percent accuracy 
level is desirable. If systems have an accuracy level below 95 percent, 
the Contractor shall demonstrate that--
    (i) There is no material harm to the Government due to lower 
accuracy levels; and
    (ii) The cost to meet the accuracy goal is excessive in relation to 
the impact on the Government;
    (6) Provide detailed descriptions of circumstances which will result 
in manual or system generated transfers of parts;
    (7) Maintain a consistent, equitable, and unbiased logic for costing 
of material transactions--
    (i) The Contractor shall maintain and disclose written policies 
describing the transfer methodology and the loan/pay-back technique.
    (ii) The costing methodology may be standard or actual cost, or any 
of the inventory costing methods in 48 CFR 9904.411-50(b). Consistency 
shall be maintained across all contract and customer types, and from 
accounting period to accounting period for initial charging and transfer 
charging.
    (iii) The system should transfer parts and associated costs within 
the same billing period. In the few instances where this may not be 
appropriate, the Contractor may accomplish the material transaction 
using a loan/pay-back technique. The ``loan/pay-back technique'' means 
that the physical part is moved temporarily from the contract, but the 
cost of the part remains on the contract. The procedures for the loan/
pay-back technique must be approved by the Administrative Contracting 
Officer. When the technique is used, the Contractor shall have controls 
to ensure--
    (A) Parts are paid back expeditiously;
    (B) Procedures and controls are in place to correct any overbilling 
that might occur;
    (C) Monthly, at a minimum, identification of the borrowing contract 
and the date the part was borrowed; and
    (D) The cost of the replacement part is charged to the borrowing 
contract;
    (8) Where allocations from common inventory accounts are used, have 
controls (in addition to those in paragraphs (b)(2) and (7) of this 
clause) to ensure that--
    (i) Reallocations and any credit due are processed no less 
frequently than the routine billing cycle;
    (ii) Inventories retained for requirements which are not under 
contract are not allocated to contracts; and
    (iii) Algorithms are maintained based on valid and current data;
    (9) Notwithstanding FAR 45.505-3(f)(1)(ii), have adequate controls 
to ensure that physically commingled inventories that may include 
material for which costs are charged or allocated to fixed-price, cost-
reimbursement, and commercial contracts do not compromise requirements 
of any of the standards in paragraphs (f)(1) through (8) of this clause. 
Government furnished material shall not be--
    (i) Physically commingled with other material; or
    (ii) Used on commercial work; and

[[Page 532]]

    (10) Be subjected to periodic internal audits to ensure compliance 
with established policies and procedures.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 61 FR 50456, Sept. 26, 1996]



252.242-7005  Cost/Schedule Status Report.

    As prescribed in 242.1107-70(a), use the following clause:

                 Cost/Schedule Status Report (Mar 1997)

    (a) The Contractor shall use management procedures in the 
performance of this contract that provide for--
    (1) Planning and control of costs;
    (2) Measurement of performance (value for completed tasks); and
    (3) Generation of timely and reliable information for the cost/
schedule status report (C/SSR).
    (b) As a minimum, these procedures must provide for--
    (1) Establishing the time-phased budgeted cost of work scheduled 
(including work authorization, budgeting, and scheduling), the budgeted 
cost for work performed, the actual cost of work performed, the budget 
at completion, the estimate at completion, and provisions for 
subcontractor performance measurement and reporting;
    (2) Applying all direct and indirect costs and provisions for use 
and control of management reserve and undistributed budget;
    (3) Incorporating changes to the contract budget base for both 
Government directed changes and internal replanning;
    (4) Establishing constraints to preclude subjective adjustment of 
data to ensure performance measurement remains realistic. Unless the 
Contracting Officer provides prior written approval, in no case shall 
the total allocated budget exceed the contract budget base. For cost-
reimbursement contracts, the contract budget base shall exclude changes 
for cost growth increases, other than for authorized changes to the 
contract scope; and
    (5) Establishing the capability to accurately identify and explain 
significant cost and schedule variances, both on a cumulative basis and 
projected at completion basis.
    (c) The Contractor may use a cost/schedule control system that has 
been recognized by the cognizant Administrative Contracting Officer 
(ACO) as complying with the earned value management system criteria 
provided in DoD 5000.2-R, Mandatory Procedures for Major Defense 
Acquisition Programs (MDAPs) and Major Automated Information System 
(MAIS) Acquisition Programs.
    (d) The Government may require an integrated baseline review within 
180 calendar days after (1) contract award, (2) the exercise of 
significant contract options, or (3) the incorporation of major 
modifications. The purpose of the integrated baseline review is for the 
Government and the Contractor to jointly assess areas, such as the 
Contractor's planning, to ensure complete coverage of the statement of 
work, logical scheduling of the work activities, adequate resourcing, 
and identification of inherent risks. The Contractor shall provide 
necessary documents and data which describe the methods of planning, 
control and data generation in actual operation and satisfy the 
requirements of paragraph (a) of this clause.
    (e) The Contractor shall provide access to all pertinent records, 
company procedures, and data requested by the ACO, or authorized 
representative, to--
    (1) Show proper implementation of the procedures generating the cost 
and schedule information being used to satisfy the C/SSR contractual 
data requirements to the Government; and
    (2) Ensure continuing application of the accepted company procedures 
in satisfying the C/SSR data item.
    (f) The Contractor shall submit any substantive changes to the 
procedures and their impact to the ACO for review.
    (g) The Contractor shall require a subcontractor to furnish C/SSR in 
each case where the subcontract is other than firm-fixed-price, is 12 
months or more in duration, and has critical or significant tasks 
related to the prime contract. Critical or significant tasks shall be 
defined by mutual agreement between the Government and Contractor. Each 
subcontractor's reported cost and schedule information shall be 
incorporated into the Contractor's C/SSR.

                             (End of clause)

[62 FR 9992, Mar. 5, 1997, as amended at 62 FR 34135, June 24, 1997]



252.242-7006  Cost/Schedule Status Report Plans.

    As prescribed in 242.1107-70(b), use the following provision:

              Cost/Schedule Status Report Plans (Mar 1997)

    (a) The offeror shall submit a written summary of the management 
procedures it will establish, maintain, and use in the performance of 
any resultant contract to comply with the requirements of the clause at 
252.242-7005, Cost/Schedule Status Report.
    (b) If the offeror proposes to use a cost/schedule control system 
that has been recognized by the cognizant Administrative Contracting 
Officer as complying with the earned value management system criteria of 
DoD 5000.2-R, Mandatory Procedures for

[[Page 533]]

Major Defense Acquisition Programs (MDAPs) and Major Automated 
Information System (MAIS) Acquisition Programs, the offeror may submit a 
copy of the documentation of such recognition instead of the written 
summary required by paragraph (a) of this provision.

                           (End of provision)

[62 FR 9992, Mar. 5, 1997, as amended at 62 FR 34135, June 24, 1997]



Sec. 252.243-7000  Engineering change proposals.

    As prescribed in 243.205-70, use the following clause:

                 Engineering Change Proposals (Jul 1997)

    (a) The Contracting Officer may ask the Contractor to prepare 
engineering change proposals for engineering changes within the scope of 
this contract. Upon receipt of a written request from the Contracting 
Officer, the Contractor shall prepare and submit an engineering change 
proposal in accordance with the instructions of MIL-STD-973, in effect 
on the date of contract award.
    (b) The Contractor may initiate engineering change proposals. 
Contractor initiated engineering change proposals shall include a ``not 
to exceed'' price* or a ``not less than'' price* and delivery 
adjustment. If the Contracting Officer orders the engineering change, 
the increase shall not exceed nor the decrease be less than the ``not to 
exceed'' or ``not less than'' amounts**.
---------------------------------------------------------------------------

    * Use a term suitable for the type of contract.
    ** In cost reimbursement type contracts, replace this sentence with 
the following: ``Change orders issued under the Changes clause of this 
contract are not an authorization to exceed the estimated cost in the 
schedule unless there is a statement in the change order, or other 
contract modification, increasing the estimated cost.''
---------------------------------------------------------------------------

    (c) When the price** of the engineering change is $500,000 or more, 
the Contractor shall submit--
    (1) A completed SF 1411, Contract Pricing Proposal Cover Sheet (Cost 
or Pricing Data Required); and
    (2) At the time of agreement on price*, or on another date agreed 
upon between the parties, a signed Certificate of Current Cost or 
Pricing Data.

                             (End of clause)

                         Alternate I (May 1994)

    As prescribed in 243.205-70, add the following paragraph (d) to the 
basic clause:
    (d) If the price* of a Contractor initiated engineering change is 
____________*** or less, the change, if ordered, shall be made at no 
adjustment in the contract price*.
---------------------------------------------------------------------------

    *** Insert a percentage of the contract price or a dollar amount.
---------------------------------------------------------------------------

[59 FR 27677, May 27, 1994, as amended at 62 FR 40473, July 29, 1997]



252.243-7001  Pricing of contract modifications.

    As prescribed in 243.205-71, use the following clause:

              Pricing of Contract Modifications (Dec. 1991)

    When costs are a factor in any price adjustment under this contract, 
the contract cost principles and procedures in FAR part 31 and DFARS 
part 231, in effect on the date of this contract, apply.

                             (End of clause)



252.243-7002  Certification of requests for equitable adjustment.

    As prescribed in 243.205-72, use the following clause:

     Certification of Requests for Equitable Adjustment (July 1997)

    (a) In accordance with 10 U.S.C. 2410(a), any request for equitable 
adjustment to contract terms that exceeds the simplified acquisition 
threshold shall bear, at the time of submission, the following 
certificate executed by an individual authorized to certify the request 
on behalf of the Contractor:
    I certify that the request is made in good faith, and that the 
supporting data are accurate and complete to the best of my knowledge 
and belief.

 _______________________________________________________________________
(Official's Name)

 _______________________________________________________________________
(Title)

    (b) The certification in paragraph (a) of this clause requires full 
disclosure of all relevant facts, including--
    (1) Cost or pricing data if required in accordance with FAR 15.804-
2; and
    (2) Actual cost data and data to support any estimated costs, even 
if cost of pricing data are not required.
    (c) The certification requirement in paragraph (a) of this clause 
does not apply to--(1) Requests for routine contract payments; for 
example, requests for payment for accepted supplies and services, 
routine vouchers under a cost-reimbursement type contract, or progress 
payment invoices; or

[[Page 534]]

    (2) Final adjustments under an incentive provision of the contract.
    (d) The amount requested shall accurately reflect the contract 
adjustment for which the Contractor believes the Government is liable. 
The request shall include only costs for performing the change, and 
shall not include any costs that already have been reimbursed or that 
have been separately claimed. All indirect costs included in the request 
shall be properly allocable to the change in accordance with applicable 
acquisition regulations.

                             (End of clause)

[62 FR 37147, July 11, 1997; 62 FR 49306, Sept. 19, 1997]



252.244-7000   Subcontracts for commercial items and commercial components (DoD contracts).

    As prescribed in 244.403, use the following clause:

    Subcontracts for Commercial Items and Commercial Components (DoD 
                          Contracts) (Feb 1997)

    In addition to the clauses listed in paragraph (c) of the 
Subcontracts for Commercial Items and Commercial Components clause of 
this contract, the Contractor shall include the terms of the following 
clause, if applicable, in subcontracts for commercial items or 
commercial components, awarded at any tier under this contract:
    252.225-7014, Preference for Domestic Specialty Metals, Alternate I 
(10 U.S.C. 2241 note).

                             (End of clause)

[62 FR 5780, Feb. 7, 1997]



252.245-7000  Government-furnished mapping, charting, and geodesy property.

    As prescribed in 245.310-70, use the following clause:

Government-Furnished Mapping, Charting, and Geodesy Property (Dec. 1991)

    (a) Definition--Mapping, charting, and geodesy (MC&G) property means 
geodetic, geomagnetic, gravimetric, aeronautical, topographic, 
hydrographic, cultural, and toponymic data presented in the form of 
topographic, planimetric, relief, or thematic maps and graphics; 
nautical and aeronautical charts and publications; and in simulated, 
photographic, digital, or computerized formats.
    (b) The Contractor shall not duplicate, copy, or otherwise reproduce 
MC&G property for purposes other than those necessary for performance of 
the contract.
    (c) At the completion of performance of the contract, the 
Contractor, as directed by the Contracting Officer, shall either destroy 
or return to the Government all Government-furnished MC&G property not 
consumed in the performance of this contract.

                             (End of clause)



Sec. 252.245-7001  Reports of Government property.

    As prescribed in 245.505-14(a), use the following clause:

                Reports of Government Property (May 1994)

    (a) The Contractor shall provide an annual report--
    (1) For all DoD property for which the Contractor is accountable 
under the contract;
    (2) Prepared in accordance with the requirements of DD Form 1662, 
DoD Property in the Custody of Contractors, or approved substitute, 
including instructions on the reverse side of the form;
    (3) In duplicate, to the cognizant Government property 
administrator, no later than October 31.
    (b) The Contractor is responsible for reporting all Government 
property accountable to this contract, including that at subcontractor 
and alternate locations.

                             (End of clause)

[59 FR 27677, May 27, 1994]



252.246-7000  Material inspection and receiving report.

    As prescribed in 246.370, use the following clause:

          Material Inspection and Receiving Report (Dec. 1991)

    At the time of each delivery of supplies or services under this 
contract, the Contractor shall prepare and furnish to the Government a 
material inspection and receiving report in the manner and to the extent 
required by appendix F, Material Inspection and Receiving Report, of the 
Defense FAR Supplement.

                             (End of clause)



252.246-7001  Warranty of data.

    As prescribed in 246.710 (1), use the following clause:

[[Page 535]]

                      Warranty of Data (Dec. 1991)

    (a) Definition--Technical data has the same meaning as given in the 
clause in this contract entitled, Rights in Technical Data and Computer 
Software.
    (b) Warranty. Notwithstanding inspection and acceptance by the 
Government of technical data furnished under this contract, and 
notwithstanding any provision of this contract concerning the 
conclusiveness of acceptance, the Contractor warrants that all technical 
data delivered under this contract will at the time of delivery conform 
with the specifications and all other requirements of this contract. The 
warranty period shall extend for three years after completion of the 
delivery of the line item of data (as identified in DD Form 1423, 
Contract Data Requirements List) of which the data forms a part; or any 
longer period specified in the contract.
    (c) Contractor notification. The Contractor agrees to notify the 
Contracting Officer in writing immediately of any breach of the above 
warranty which the Contractor discovers within the warranty period.
    (d) Remedies. The following remedies shall apply to all breaches of 
the warranty, whether the Contractor notifies the Contracting Officer in 
accordance with paragraph (c) of this clause or if the Government 
notifies the Contractor of the breach in writing within the warranty 
period:
    (1) Within a reasonable time after such notification, the 
Contracting Officer may--
    (i) By written notice, direct the Contractor to correct or replace 
at the Contractor's expense the nonconforming technical data promptly; 
or
    (ii) If the Contracting Officer determines that the Government no 
longer has a requirement for correction or replacement of the data, or 
that the data can be more reasonably corrected by the Government, inform 
the Contractor by written notice that the Government elects a price or 
fee adjustment instead of correction or replacement.
    (2) If the Contractor refuses or fails to comply with a direction 
under paragraph (d) (1)(i) of this clause, the Contracting Officer may, 
within a reasonable time of the refusal or failure--
    (i) By contract or otherwise, correct or replace the nonconforming 
technical data and charge the cost to the Contractor; or
    (ii) Elect a price or fee adjustment instead of correction or 
replacement.
    (3) The remedies in this clause represent the only way to enforce 
the Government's rights under this clause.
    (e) The provisions of this clause apply anew to that portion of any 
corrected or replaced technical data furnished to the Government under 
paragraph (d)(1)(i) of this clause.

                             (End of clause)

                         Alternate I (Dec. 1991)

    As prescribed in 246.710(2), substitute the following for paragraph 
(d)(3) of the basic clause:
    (3) In addition to the remedies under paragraphs (d)(1) and (2) of 
this clause, the Contractor shall be liable to the Government for all 
damages to the Government as a result of the breach of warranty.
    (i) The additional liability under paragraph (d)(3) of this clause 
shall not exceed 75 percent of the target profit.
    (ii) If the breach of the warranty is with respect to the data 
supplied by an equipment subcontractor, the limit of the Contractor's 
liability shall be--
    (A) Ten percent of the total subcontract price in a firm fixed price 
subcontract;
    (B) Seventy-five percent of the total subcontract fee in a cost-
plus-fixed-fee or cost-plus-award-fee subcontract; or
    (C) Seventy-five percent of the total subcontract target profit or 
fee in a fixed-price or cost-plus-incentive-type contract.
    (iii) Damages due the Government under the provisions of this 
warranty are not an allowable cost.
    (iv) The additional liability in paragraph (d)(3) of this clause 
shall not apply--
    (A) With respect to the requirements for product drawings and 
associated lists, special inspection equipment (SIE) drawings and 
associated lists, special tooling drawings and associated lists, SIE 
operating instructions, SIE descriptive documentation, and SIE 
calibration procedures under MIL-T-31000, General Specification for 
Technical Data Packages, Amendment 1, or MIL-T-47500, General 
Specification for Technical Data Packages, Supp 1, or drawings and 
associated lists under level 2 or level 3 of MIL-D-1000A, Engineering 
and Associated Data Drawings, or DoD-D-1000B, Engineering and Associated 
Lists Drawings (Inactive for New Design) Amendment 4, Notice 1; or 
drawings and associated lists under category E or I of MIL-D-1000, 
Engineering and Associated Lists Drawings, provided that the data 
furnished by the Contractor was current, accurate at time of submission, 
and did not involve a significant omission of data necessary to comply 
with the requirements; or
    (B) To defects the Contractor discovers and gives written notice to 
the Government before the Government discovers the error.

                        Alternate II (Dec. 1991)

    As prescribed at 246.710(3), substitute the following paragraph for 
paragraph (d)(3) of the basic clause:

    (3) In addition to the remedies under paragraphs (d)(1) and (2) of 
this clause, the Contractor shall be liable to the Government for

[[Page 536]]

all damages to the Government as a result of the breach of the warranty.
    (i) The additional liability under paragraph (d)(3) of this clause 
shall not exceed ten percent of the total contract price.
    (ii) If the breach of the warranty is with respect to the data 
supplied by an equipment subcontractor, the limit of the Contractor's 
liability shall be--
    (A) Ten percent of the total subcontract price in a firm fixed-price 
subcontract;
    (B) Seventy-five percent of the total subcontract fee in a cost-
plus-fixed-fee or cost-plus-award-fee subcontract; or
    (C) Seventy-five percent of the total subcontract target profit or 
fee in a fixed-price or cost-plus-incentive-type contract.
    (iii) The additional liability specified in paragraph (d)(3) of this 
clause shall not apply--
    (A) With respect to the requirements for product drawings and 
associated lists, special inspection equipment (SIE) drawings and 
associated lists, special tooling drawings and associated lists, SIE 
operating instructions, SIE descriptive documentation, and SIE 
calibration procedures under MIL-T-31000, General Specification for 
Technical Data Packages, Amendment 1, or MIL-T-47500, General 
Specification for Technical Data Packages, Supp 1, or drawings and 
associated lists under level 2 or level 3 of MIL-D-1000A, Engineering 
and Associated Data Drawings, or DoD-D-1000B, Engineering and Associated 
Lists Drawings (Inactive for New Design) Amendment 4, Notice 1; or 
drawings and associated lists under category E or I of MIL-D-1000, 
Engineering and Associated Lists Drawings, provided that the data 
furnished by the Contractor was current, accurate at time of submission, 
and did not involve a significant omission of data necessary to comply 
with the requirements; or
    (B) To defects the Contractor discovers and gives written notice to 
the Government before the Government discovers the error.



252.246-7002  Warranty of construction (Germany).

    As prescribed in 246.710(4), use the following clause:

             Warranty of Construction (Germany) (JUNE 1997)

    (a) In addition to any other representations in this contract, the 
Contractor warrants, except as provided in paragraph (j) of this clause, 
that the work performed under this contract conforms to the contract 
requirements and is free of any defect of equipment, material, or design 
furnished or workmanship performed by the Contractor or any 
subcontractor or supplier at any tier.
    (b) This warranty shall continue for the period(s) specified in 
Section 13, VOB, Part B, commencing from the date of final acceptance of 
the work under this contract. If the Government takes possession of any 
part of the work before final acceptance, this warranty shall continue 
for the period(s) specified in Section 13, VOB, Part B, from the date 
the Government takes possession.
    (c) The Contractor shall remedy, at the Contractor's expense, any 
failure to conform or any defect. In addition, the Contractor shall 
remedy, at the Contractor's expense, any damage to Government-owned or -
controlled real or personal property when that damage is the result of--
    (1) The Contractor's failure to conform to contract requirements; or
    (2) Any defect of equipment, material, or design furnished or 
workmanship performed.
    (d) The Contractor shall restore any work damaged in fulfilling the 
terms and conditions of this clause.
    (e) The Contracting Officer shall notify the Contractor, in writing, 
within a reasonable period of time after the discovery of any failure, 
defect, or damage.
    (f) If the Contractor fails to remedy any failure, defect, or damage 
within a reasonable period of time after receipt of notice, the 
Government shall have the right to replace, repair, or otherwise remedy 
the failure, defect, or damage at the Contractor's expense.
    (g) With respect to all warranties, express or implied, from 
subcontractors, manufacturers, or suppliers for work performed and 
materials furnished under this contract, the Contractor shall--
    (1) Obtain all warranties that would be given in normal commercial 
practice;
    (2) Require all warranties to be executed in writing, for the 
benefit of the Government, if directed by the Contracting Officer; and
    (3) Enforce all warranties for the benefit of the Government as 
directed by the Contracting Officer.
    (h) In the event the Contractor's warranty under paragraph (b) of 
this clause has expired, the Government may bring suit at its expense to 
enforce a subcontractor's, manufacturer's, or supplier's warranty.
    (i) Unless a defect is caused by the Contractor's negligence, or the 
negligence of a subcontractor or supplier at any tier, the Contractor 
shall not be liable for the repair of any defects of material or design 
furnished by the Government or for the repair of any damage resulting 
from any defeat in Government-furnished material or design.
    (j) This warranty shall not limit the Government's right under the 
Inspection clause of this contract, with respect to latent defects, 
gross mistakes, or fraud.

                             (End of clause)

[62 FR 34135, June 24, 1997; 62 FR 49306, Sept. 19, 1997]

[[Page 537]]



252.247-7000  Hardship conditions.

    As prescribed in 247.270-7(a), use the following clause:

                     Hardship Conditions (Dec. 1991)

    (a) The Contractor shall promptly notify the Contracting Officer of 
unusual conditions associated with loading or unloading a particular 
cargo, which will work a hardship on the Contractor if loaded or 
unloaded at the basic commodity rates.
    (b) Unusual conditions include, but are not limited to, 
inaccessibility of place of stowage to the ship's cargo gear, side port 
operations, and small quantities of cargo in any one hatch.
    (c) The Contracting Officer shall investigate the conditions 
promptly after receiving the notice. If the Contracting Officer finds 
that the conditions are unusual and do materially affect the cost of 
loading or unloading, the Contracting Officer will authorize payment at 
the extra-labor rates set forth in the schedule of rates of this 
contract.

                             (End of clause)



252.247-7001  Price adjustment.

    As prescribed in 247.270-7(b), use the following clause:

                       Price Adjustment (JAN 1997)

    (a) The Contractor warrants that the prices set forth in this 
contract--
    (1) Are based upon the wage rates, allowances, and conditions set 
forth in the collective bargaining agreements between the Contractor and 
its employees, in effect as of (insert date), and which are generally 
applicable to the ports where work under this contract is performed;
    (2) Apply to operations by the Contractor on non-Government work as 
well as under this contract; and
    (3) Do not include any allowance for cost increases that may--
    (i) Become effective under the terms of the collective bargaining 
agreements after the date in paragraph (a)(1) of this clause; or
    (ii) Result from modification of the collective bargaining 
agreements after the date in paragraph (a)(1).
    (b) The Contractor shall notify the Contracting Officer within 60 
days of receipt of notice of any changes (increase or decrease) in the 
wage rates, allowances, fringe benefits, and conditions that apply to 
its direct labor employees, if the changes--
    (1) Are pursuant to the provisions of the collective bargaining 
agreements; or
    (2) Are a result of effective modifications to the agreements; and
    (3) Would change the Contractor's costs to perform this contract.
    (c) The Contractor shall include in its notification--
    (1) A proposal for an adjustment in the contract commodity, 
activity, or work-hour prices; and
    (2) Data, in such form as the Contracting Officer may require, 
explaining the--
    (i) Causes;
    (ii) Effective date; and
    (iii) Amount of the increase or decrease in the Contractor's 
proposal for the adjustment.
    (d) Promptly upon receipt of any notice and data described in 
paragraph (c), the Contractor and the Contracting Officer shall 
negotiate an adjustment in the existing contract commodity, activity, or 
man-hour prices. However, no upward adjustment of the existing 
commodity, activity, or work-hour prices will be allowed in excess of 
________ percent per year, except as provided in the Changes clause of 
this contract.
    (1) Changes in the contract prices shall reflect, in addition to the 
direct and variable indirect labor costs, the associated changes in the 
costs for social security, unemployment compensation, taxes, and 
workman's compensation insurance.
    (2) There will be no adjustment to increase the dollar amount 
allowances of the Contractor's profit.
    (3) The agreed upon adjustment, its effective date, and the revised 
commodity, activity, or work-hour prices for services set forth in the 
schedule of rates, shall be incorporated in the contract by supplemental 
agreement.
    (e) There will be no adjustment for any changes in the quantities of 
labor that the Contractor contemplated for each specific commodity, 
except as may result from modifications of the collective bargaining 
agreements. For the purpose of administering this clause, the Contractor 
shall submit to the Contracting Officer, within five days after award, 
the accounting data and computations the Contractor used to determine 
its estimated efficiency rate in the performance of this contract, to 
include the Contractor's computation of the costs apportioned for each 
rate set forth in the schedule of rates.
    (f) Failure of the parties to agree to an adjustment under this 
clause will be deemed to be a dispute concerning a question of fact 
within the meaning of the Disputes clause of this contract. The 
Contractor shall continue performance pending agreement on, or 
determination of, any such adjustment and its effective date.
    (g) The Contractor shall include with the final invoice submitted 
under this contract a statement that the Contractor has not experienced 
a decrease in rates of pay for labor, or that the Contractor has given 
notice of all such decreases in compliance with paragraph (b) of this 
clause.

[[Page 538]]

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 62 FR 2615, Jan. 17, 1997]



252.247-7002  Revision of prices.

    As prescribed in 247.270-7(c), use the following clause:

                     Revision of Prices (Dec. 1991)

    (a) Definition. Wage adjustment, as used in this clause, means a 
change in the wages, salaries, or other terms or conditions of 
employment which--
    (1) Substantially affects the cost of performing this contract;
    (2) Is generally applicable to the port where work under this 
contract is performed; and
    (3) Applies to operations by the Contractor on non-Government work 
as well as to work under this contract.
    (b) General. The prices fixed in this contract are based on wages 
and working conditions established by collective bargaining agreements, 
and on other conditions in effect on the date of this contract. The 
Contracting Officer and the Contractor may agree to increase or decrease 
such prices in accordance with this clause.
    (c) Demand for negotiation. (1) At any time, subject to the 
limitations specified in this clause, either the Contracting Officer or 
the Contractor may deliver to the other a written demand that the 
parties negotiate to revise the prices under this contract.
    (2) No such demand shall be made before 90 days after the date of 
this contract, and thereafter neither party shall make a demand having 
an effective date within 90 days of the effective date of any prior 
demand. However, this limitation does not apply to a wage adjustment 
during the 90 day period.
    (3) Each demand shall specify a date (the same as or subsequent to 
the date of the delivery of the demand) as to when the revised prices 
shall be effective. This date is the effective date of the price 
revision.
    (i) If the Contractor makes a demand under this clause, the demand 
shall briefly state the basis of the demand and include the statements 
and data referred to in paragraph (d) of this clause.
    (ii) If the demand is made by the Contracting Officer, the 
Contractor shall furnish the statements and data within 30 days of the 
delivery of the demand.
    (d) Submission of data. At the times specified in paragraphs 
(c)(3)(i) and (ii) of this clause, the Contractor shall submit--
    (1) A new estimate and breakdown of the unit cost and the proposed 
prices for the services the Contractor will perform under this contract 
after the effective date of the price revision, itemized to be 
consistent with the original negotiations of the contract;
    (2) An explanation of the difference between the original (or last 
preceding) estimate and the new estimate;
    (3) Such relevant operating data, cost records, overhead absorption 
reports, and accounting statements as may be of assistance in 
determining the accuracy and reliability of the new estimate;
    (4) A statement of the actual costs of performance under this 
contract to the extent that they are available at the time of the 
negotiation of the revision of prices under this clause; and
    (5) Any other relevant data usually furnished in the case of 
negotiations of prices under a new contract. The Government may examine 
and audit the Contractor's accounts, records, and books as the 
Contracting Officer considers necessary.
    (e) Negotiations. (1) Upon the filing of the statements and data 
required by paragraph (d) of this clause, the Contractor and the 
Contracting Officer shall negotiate promptly in good faith to agree upon 
prices for services the Contractor will perform on and after the 
effective date of the price revision.
    (2) If the prices in this contract were established by competitive 
negotiation, they shall not be revised upward unless justified by 
changes in conditions occurring after the contract was awarded.
    (3) The agreement reached after each negotiation will be 
incorporated into the contract by supplemental agreement.
    (f) Disagreements. If, within 30 days after the date on which 
statements and data are required pursuant to paragraph (c) of this 
clause, the Contracting Officer and the Contractor fail to agree to 
revised prices, the failure to agree shall be resolved in accordance 
with the Disputes clause of this contract. The prices fixed by the 
Contracting Officer will remain in effect for the balance of the 
contract, and the Contractor shall continue performance.
    (g) Retroactive changes in wages or working conditions. (1) In the 
event of a retroactive wage adjustment, the Contractor or the 
Contracting Officer may request an equitable adjustment in the prices in 
this contract.
    (2) The Contractor shall request a price adjustment within 30 days 
of any retroactive wage adjustment. The Contractor shall support its 
request with--
    (i) An estimate of the changes in cost resulting from the 
retroactive wage adjustment;
    (ii) Complete information upon which the estimate is based; and
    (iii) A certified copy of the collective bargaining agreement, 
arbitration award, or other document evidencing the retroactive wage 
adjustment.
    (3) Subject to the limitation in paragraph (g)(2) of this clause as 
to the time of making a request, completion or termination of this

[[Page 539]]

contract shall not affect the Contractor's right under paragraph (g) of 
this clause.
    (4) In case of disagreement concerning any question of fact, 
including whether any adjustment should be made, or the amount of such 
adjustment, the disagreement will be resolved in accordance with the 
Disputes clause of this contract.
    (5) The Contractor shall notify the Contracting Officer in writing 
of any request by or on behalf of the employees of the Contractor which 
may result in a retroactive wage adjustment. The notice shall be given 
within 20 days after the request, or if the request occurs before 
contract execution, at the time of execution.

                             (End of clause)



252.247-7003  Termination.

    As prescribed in 247.270-7(d), use the following clause:

                         Termination (Dec. 1991)

    (a) Either the Contracting Officer or the Contractor may terminate 
this contract at any time upon 60 days (or such other number of days 
provided in the Schedule) written notice to the other. Termination under 
this clause does not affect any obligation or liability that may have 
accrued before the termination.
    (b) Upon termination of this contract under either paragraph (a) or 
the Default clause of this contract, the Government shall pay the 
Contractor any amount due for services performed under this contract to 
the date of termination.
    (c) In the event of partial termination, payment for services 
furnished under the portion of the contract not terminated shall be in 
accordance with the terms of this contract.
    (d) Any payments under this clause shall be without prejudice to any 
Government claim against the Contractor. The Government has the right to 
offset any such claims against any such payment.

                             (End of clause)



252.247-7004  Indefinite quantities--fixed charges.

    As prescribed in 247.270-7(e), use the following clause:

            Indefinite Quantities--Fixed Charges (Dec. 1991)

    The amount of work and services the Contractor may be ordered to 
furnish shall be the amount the Contracting Officer may order from time 
to time. In any event, the Government is obligated to compensate the 
Contractor the monthly lump sum specified in the Schedule entitled Fixed 
Charges, for each month or portion of a month the contract remains in 
effect.

                             (End of clause)



252.247-7005  Indefinite quantities--no fixed charges.

    As prescribed in 247.270-7(f), use the following clause:

           Indefinite Quantities--No Fixed Charges (Dec. 1991)

    The amount of work and services the Contractor may be ordered to 
furnish shall be the amount the Contracting Officer may order from time 
to time. In any event, the Government shall order, during the term of 
this contract, work or services having an aggregate value of not less 
than $100.

                             (End of clause)



252.247-7006  Removal of contractor's employees.

    As prescribed in 247.270-7(g), use the following clause:

              Removal of Contractor's Employees (Dec. 1991)

    The Contractor agrees to use only experienced, responsible, and 
capable people to perform the work. The Contracting Officer may require 
that the Contractor remove from the job, employees who endanger persons 
or property, or whose continued employment under this contract is 
inconsistent with the interest of military security.

                             (End of clause)



252.247-7007  Liability and insurance.

    As prescribed in 247.270-7(h), use the following clause:

                   Liability and Insurance (Dec. 1991)

    (a) The Contractor shall be--
    (1) Liable to the Government for loss or damage to property, real 
and personal, owned by the Government or for which the Government is 
liable;
    (2) Responsible for, and hold the Government harmless from, loss of 
or damage to property not included in paragraph (a)(1); and
    (3) Responsible for, and hold the Government harmless from, bodily 
injury and death of persons, resulting either in whole or in part from 
the negligence or fault of the Contractor, its officers, agents, or 
employees in the performance of work under this contract.
    (b) For the purpose of this clause, all cargo loaded or unloaded 
under this contract is

[[Page 540]]

agreed to be property owned by the Government or property for which the 
Government is liable.
    (1) The amount of the loss or damage as determined by the 
Contracting Officer will be withheld from payments otherwise due the 
Contractor.
    (2) Determination of liability and responsibility by the Contracting 
Officer will constitute questions of fact within the meaning of the 
Disputes clause of this contract.
    (c) The general liability and responsibility of the Contractor under 
this clause are subject only to the following specific limitations. The 
Contractor is not responsible to the Government for, and does not agree 
to hold the Government harmless from, loss or damage to property or 
bodily injury to or death of persons if--
    (1) The unseaworthiness of the vessel, or failure or defect of the 
gear or equipment furnished by the Government, contributed jointly with 
the fault or negligence of the Contractor in causing such damage, 
injury, or death; and
    (i) The Contractor, his officers, agents, and employees, by the 
exercise of due diligence, could not have discovered such 
unseaworthiness or defect of gear or equipment; or
    (ii) Through the exercise of due diligence could not otherwise have 
avoided such damage, injury, or death.
    (2) The damage, injury, or death resulted solely from an act or 
omission of the Government or its employees, or resulted solely from 
proper compliance by officers, agents, or employees of the Contractor 
with specific directions of the Contracting Officer.
    (d) The Contractor shall at its own expense acquire and maintain 
insurance during the term of this contract, as follows--
    (1) Standard workmen's compensation and employer's liability 
insurance and longshoremen's and harbor workers' compensation insurance, 
or such of these as may be proper under applicable state or Federal 
statutes.
    (i) The Contractor may, with the prior approval of the Contracting 
Officer, be a self-insurer against the risk of this paragraph (d)(1).
    (ii) This approval will be given upon receipt of satisfactory 
evidence that the Contractor has qualified as a self-insurer under 
applicable provision of law.
    (2) Bodily injury liability insurance in an amount of not less than 
$300,000 on account of any one occurrence.
    (3) Property damage liability insurance (which shall include any and 
all property, whether or not in the care, custody, or control of the 
Contractor) in an amount of not less than $300,000 for any one 
occurrence.
    (e) Each policy shall provide, by appropriate endorsement or 
otherwise, that cancellation or material change in the policy shall not 
be effective until after a 30 day written notice is furnished the 
Contracting Officer.
    (f) The Contractor shall furnish the Contracting Officer with 
satisfactory evidence of the insurance required in paragraph (d) before 
performance of any work under this contract.
    (g) The Contractor shall, at its own cost and expense, defend any 
suits, demands, claims, or actions, in which the United States might be 
named as a co-defendant of the Contractor, resulting from the 
Contractor's performance of work under this contract. This requirement 
is without regard to whether such suit, demand, claim, or action was the 
result of the Contractor's negligence. The Government shall have the 
right to appear in such suit, participate in defense, and take such 
actions as may be necessary to protect the interest of the United 
States.
    (h) It is expressly agreed that the provisions in paragraphs (d) 
through (g) of this clause shall not in any manner limit the liability 
or extend the liability of the Contractor as provided in paragraphs (a) 
through (c) of this clause.
    (i) The Contractor shall--
    (1) Equitably reimburse the Government if the Contractor is 
indemnified, reimbursed, or relieved of any loss or damage to Government 
property;
    (2) Do nothing to prevent the Government's right to recover against 
third parties for any such loss or damage; and
    (3) Furnish the Government, upon the request of the Contracting 
Officer, at the Government's expense, all reasonable assistance and 
cooperation in obtaining recovery, including the prosecution of suit and 
the execution of instruments of assignment in favor of the Government.

                             (End of clause)



252.247-7008  Evaluation of bids.

    As prescribed in 247.271-4(a), use the following provision:

                     Evaluation of Bids (Dec. 1991)

    (a) The Government will evaluate bids on the basis of total 
aggregate price of all items within an area of performance under a given 
schedule.
    (1) An offeror must bid on all items within a specified area of 
performance for a given schedule. Failure to do so shall be cause for 
rejection of the bid for that area of performance of that Schedule. If 
there is to be no charge for an item, an entry such as ``No Charge,'' or 
the letters ``N/C'' or ``0,'' must be made in the unit price column of 
the Schedule.
    (2) Any bid which stipulates minimum charges or graduated prices for 
any or all

[[Page 541]]

items shall be rejected for that area of performance within the 
Schedule.
    (b) In addition to other factors, the Contracting Officer will 
evaluate bids on the basis of advantages or disadvantages to the 
Government that might result from making more than one award (multiple 
awards).
    (1) In making this evaluation, the Contracting Officer will assume 
that the administrative cost to the Government for issuing and 
administering each contract awarded under this solicitation would be 
$500.
    (2) Individual awards will be for the items and combinations of 
items which result in the lowest aggregate cost to the Government, 
including the administrative costs in paragraph (b)(1).
    (c) When drayage is necessary for the accomplishment of any item in 
the bid schedule, the Offeror shall include in the unit price any costs 
for bridge or ferry tolls, road use charges or similar expenses.
    (d) Unless otherwise provided in this solicitation, the Offeror 
shall state prices in amounts per hundred pounds on gross or net 
weights, whichever is applicable. All charges shall be subject to, and 
payable on, the basis of 100 pounds minimum weight for unaccompanied 
baggage and a 500 pound minimum weight for household goods, net or gross 
weight, whichever is applicable.

                           (End of provision)

                         Alternate I (Dec. 1991)

    As prescribed in 247.271-4(a), add the following paragraph (e) to 
the basic clause:
    (e) Notwithstanding paragraph (a), when ``additional services'' are 
added to any schedule, such ``additional services'' items will not be 
considered in the evaluation of bids.



252.247-7009  Award.

    As prescribed in 247.271-4(b), use the following provision:

                            Award (Dec. 1991)

    (a) The Government shall make award by area to the qualified low 
bidder under each of the specified schedules to the extent of the 
bidder's stated guaranteed daily capability as provided in this 
solicitation and the Estimated Quantities Schedule.
    (b) The Government reserves the right to make an award of two or 
more areas to a single bidder if such award will result in an overall 
lower estimated cost to the Government.
    (c) The Government also reserves the right to award additional 
contracts, as a result of this solicitation, to the extent necessary to 
meet its estimated maximum daily requirements.

                           (End of provision)



252.247-7010  Scope of contract.

    As prescribed in 247.271-4(d), use the following clause:

                      Scope of Contract (Dec. 1991)

    (a) The Contractor shall furnish services and materials for the 
preparation of personal property (including servicing of appliances) for 
movement or storage, drayage and related services. Unless otherwise 
indicated in the Schedule, the Contractor shall--
    (1) Furnish all materials except Government-owned containers 
(Federal Specification PPP-B-580), all equipment, plant and labor; and
    (2) Perform all work in accomplishing containerization of personal 
property for overseas or domestic movement or storage, including--
    (i) Stenciling;
    (ii) Cooperage;
    (iii) Drayage of personal property in connection with other 
services;
    (iv) Decontainerization of inbound shipments of personal property; 
and
    (v) The handling of shipments into and out of the Contractor's 
facility.
    (b) Excluded from the scope of this contract is the furnishing of 
like services or materials which are provided incident to complete 
movement of personal property when purchased by the Through Government 
Bill of Lading or other method/mode of shipment or property to be moved 
under the Do-It-Yourself moving program or otherwise moved by the owner.

                             (End of clause)



252.247-7011  Period of contract.

    As prescribed in 247.271-4(e), use the following clause:

                     Period of Contract (Dec. 1991)

    (a) This contract begins January 1, 19____, and ends December 31, 
19____, both dates inclusive. Any work ordered before, and not completed 
by the expiration date shall be governed by the terms of this contract.
    (b) The Government will not place new orders under this contract 
that require that performance commence more than 15 days after the 
expiration date.
    (c) The Government may place orders required for the completion of 
services (for shipments in the Contractor's possession) for 180 days 
past the expiration date.

[[Page 542]]

                             (End of clause)



252.247-7012  Ordering limitation.

    As prescribed in 247.271-4(g), use the following clause:

                     Ordering Limitation (Dec. 1991)

    (a) The Government will place orders for items of supplies or 
services with the contractor awarded the initial contract to the extent 
of the contractor's guaranteed maximum daily capability. However, the 
contractor may accept an additional quantity in excess of its capability 
to accommodate a single order.
    (b) Orders for additional requirements will be placed in a like 
manner with the next higher contractor to the extent of its guaranteed 
maximum daily capability. The Government will repeat this procedure 
until its total daily requirement is fulfilled.
    (c) In the event the procedure in paragraphs (a) and (b) does not 
fulfill the Government's total daily requirement, the Government may 
offer additional orders under the contract to contractors without regard 
to their guaranteed maximum daily capability.

                             (End of clause)



252.247-7013  Contract areas of performance.

    As prescribed in 247.271-4(h), use the following clause and complete 
paragraph (b) by defining each area of performance as required (see 
247.271-2(b)):

                Contract Areas of Performance (Dec. 1991)

    (a) The Government will consider all areas of performance described 
in paragraph (b) as including the Contractor's facility, regardless of 
geographical location.
    (b) The Contractor shall perform services within the following 
defined areas of performance, which include terminals identified 
therein: ________.

                             (End of clause)



252.247-7014  Demurrage.

    As prescribed in 247.271-4(i), use the following clause:

                          Demurrage (Dec. 1991)

    The Contractor shall be liable for all demurrage, detention, or 
other charges as a result of its failure to load or unload trucks, 
freight cars, freight terminals, vessel piers, or warehouses within the 
free time allowed under applicable rules and tariffs.

                             (End of clause)



252.247-7015  Requirements.

    As prescribed in 216.505(d), substitute the following paragraph (f) 
for paragraph (f) of the basic clause at FAR 52.216-21.

                         Alternate I (Dec. 1991)

    (f) Orders issued during the effective period of this contract and 
not completed within that time shall be completed by the Contractor 
within the time specified in the order. The rights and obligations of 
the Contractor and the Government for those orders shall be governed by 
the terms of this contract to the same extent as if completed during the 
effective period.



252.247-7016  Contractor liability for loss or damage.

    As prescribed in 247.271-4(k), use the following clause:

           Contractor Liability for Loss or Damage (Dec. 1991)

    (a) Definitions.
    As used in this clause--
    Article means any shipping piece or package and its contents.
    Schedule means the level of service for which specific types of 
traffic apply as described in DoD 4500.34-R, Personal Property Traffic 
Management Regulation.
    (b) For shipments picked up under Schedule I, Outbound Services, or 
delivered under Schedule II, Inbound Services--
    (1) If notified within one year after delivery that the owner has 
discovered loss or damage to the owner's property, the Contractor agrees 
to indemnify the Government for loss or damage to the property which 
arises from any cause while it is in the Contractor's possession. The 
Contractor's liability is--
    (i) Non-negligent damage. For any cause, other than the Contractor's 
negligence, indemnification shall be at a rate not to exceed sixty cents 
per pound per article.
    (ii) Negligent damage. When loss or damage is caused by the 
negligence of the Contractor, the liability is for the full cost of 
satisfactory repair or for the current replacement value of the article.
    (2) The Contractor shall make prompt payment to the owner of the 
property for any loss or damage for which the Contractor is liable.
    (3) In the absence of evidence or supporting documentation which 
places liability on a carrier or another contractor, the destination 
contractor shall be presumed to be liable for the loss or damage, if 
timely notified.

[[Page 543]]

    (c) For shipments picked up or delivered under Schedule III, Intra-
City and Intra-Area--
    (1) If notified of loss or damage within 75 days following delivery, 
the Contractor agrees to indemnify the Government for loss or damage to 
the owner's property.
    (2) The Contractor's liability shall be for the full cost of 
satisfactory repair, or for the current replacement value of the article 
less depreciation, up to a maximum liability of $1.25 per pound times 
the net weight of the shipment.
    (3) The Contractor has full salvage rights to damaged items which 
are not repairable and for which the Government has received 
compensation at replacement value.

                             (End of clause)



252.247-7017  Erroneous shipments.

    As prescribed in 247.271-4(l), use the following clause:

                     Erroneous Shipments (Dec. 1991)

    (a) The Contractor shall--
    (1) Forward to the rightful owner, articles of personal property 
inadvertently packed with goods of other than the rightful owner.
    (2) Ensure that all shipments are stenciled correctly. When a 
shipment is sent to an incorrect address due to incorrect stenciling by 
the Contractor, the Contractor shall forward it to its rightful owner.
    (3) Deliver to the designated air or surface terminal all pieces of 
a shipment, in one lot, at the same time. The Contractor shall forward 
to the owner any pieces of one lot not included in delivery, and 
remaining at its facility after departure of the original shipment.
    (b) Forwarding under paragraph (a) shall be--
    (1) With the least possible delay;
    (2) By a mode of transportation selected by the Contracting Officer; 
and
    (3) At the Contractor's expense.

                             (End of clause)



252.247-7018  Subcontracting.

    As prescribed in 247.271-4(m), use the following clause:

                       Subcontracting (Dec. 1991)

    The Contractor shall not subcontract without the prior written 
approval of the Contracting Officer. The facilities of any approved 
subcontractor shall meet the minimum standards required by this 
contract.

                             (End of clause)



252.247-7019  Drayage.

    As prescribed in 247.271-4(n), use the following clause:

                           Drayage (Dec. 1991)

    (a) Drayage included for Schedule I, Outbound, applies in those 
instances when a shipment requires drayage to an air, water, or other 
terminal for onward movement after completion of shipment preparation by 
the Contractor. Drayage not included is when it is being moved from a 
residence or other pickup point to the Contractor's warehouse for onward 
movement by another freight company, carrier, etc.
    (b) Drayage included for Schedule II, Inbound, applies in those 
instances when shipment is delivered, as ordered, from a destination 
Contractor's facility or other destination point to the final delivery 
point. Drayage not included is when shipment or partial removal of items 
from shipment is performed and prepared for member's pickup at 
destination delivery point.
    (c) The Contractor will reposition empty Government containers--
    (1) Within the area of performance;
    (2) As directed by the Contracting Officer; and
    (3) At no additional cost to the Government.

                             (End of clause)



252.247-7020  Additional services.

    As prescribed in 247.271-4(o), use the following clause:

                     Additional Services (Dec. 1991)

    The Contractor shall provide additional services not included in the 
schedule, but required for satisfactory completion of the services 
ordered under this contract, at a rate comparable to the rate for like 
services as contained in tenders on file with the Interstate Commerce 
Commission, state regulatory bodies, or the Military Traffic Management 
Command, in effect at time of order.

                             (End of clause)



252.247-7021  Returnable containers other than cylinders.

    As prescribed in 247.305-70, use the following clause:

          Returnable Containers Other Than Cylinders (May 1995)

    (a) Returnable container, as used in this clause, includes reels, 
spools, drums, carboys, liquid petroleum gas containers, and

[[Page 544]]

other returnable containers when the Contractor retains title to the 
container.
    (b) Returnable containers shall remain the Contractor's property but 
shall be loaned without charge to the Government for a period of 
______(insert number of days) calendar days after delivery to the f.o.b. 
point specified in the contract. Beginning with the first day after the 
loan period expires, to and including the day the containers are 
delivered to the Contractor (if the original delivery was f.o.b. origin) 
or are delivered or are made available for delivery to the Contractor's 
designated carrier (if the original delivery was f.o.b. destination), 
the Government shall pay the Contractor a rental of $______ (insert 
dollar amount for rental) per container per day, computed separately for 
containers for each type, size, and capacity, and for each point of 
delivery named in the contract. No rental shall accrue to the Contractor 
in excess of the replacement value per container specified in paragraph 
(c) of this clause.
    (c) For each container lost or damaged beyond repair while in the 
Government's possession, the Government shall pay to the Contractor the 
replacement value as follows, less the allocable rental paid for that 
container:

 _______________________________________________________________________
(Insert the container types, sizes, capacities, and associated 
replacement values.)

    These containers shall become Government property.
    (d) If any lost container is located within ______ (insert number of 
days) calendar days after payment by the Government, it may be returned 
to the Contractor by the Government, and the Contractor shall pay to the 
Government the replacement value, less rental computed in accordance 
with paragraph (b) of this clause, beginning at the expiration of the 
loan period specified in paragraph (b) of this clause, and continuing to 
the date on which the container was delivered to the Contractor.

                             (End of clause)

[60 FR 29503, June 5, 1995]



252.247-7022  Representation of extent of transportation by sea.

    As prescribed in 247.573(a), use the following provision:

      Representation of Extent of Transportation By Sea (Aug. 1992)

    (a) The Offeror shall indicate by checking the appropriate blank in 
paragraph (b) of this provision whether transportation of supplies by 
sea is anticipated under the resultant contract. The term supplies is 
defined in the Transportation of Supplies by Sea clause of this 
solicitation.
    (b) Representation. The Offeror represents that it--

________ Does anticipate that supplies will be transported by sea in the 
          performance of any contract or subcontract resulting from this 
          solicitation.
________ Does not anticipate that supplies will be transported by sea in 
          the performance of any contract or subcontract resulting from 
          this solicitation.
    (c) Any contract resulting from this solicitation will include the 
Transportation of Supplies by Sea clause. If the Offeror represents that 
it will not use ocean transportation, the resulting contract will also 
include the Defense FAR Supplement clause at 252.247-7024, Notification 
of Transportation of Supplies by Sea.

                           (End of provision)

[56 FR 67222, Dec. 30, 1991, as amended at 57 FR 42633, Sept. 15, 1992]



252.247-7023  Transportation of supplies by sea.

    As prescribed in 247.573(b), use the following clause:

             Transportation of Supplies by Sea (NOV 1995T4)

    (a) Definitions. As used in this clause--
    (1) Components means articles, materials, and supplies incorporated 
directly into end products at any level of manufacture, fabrication, or 
assembly by the Contractor or any subcontractor.
    (2) Department of Defense (DoD) means the Army, Navy, Air Force, 
Marine Corps, and defense agencies.
    (3) Foreign flag vessel means any vessel that is not a U.S.-flag 
vessel.
    (4) Ocean transportation means any transportation aboard a ship, 
vessel, boat, barge, or ferry through international waters.
    (5) Subcontractor means a supplier, materialman, distributor, or 
vendor at any level below the prime contractor whose contractual 
obligation to perform results from, or is conditioned upon, award of the 
prime contract and who is performing any part of the work or other 
requirement of the prime contract. However, effective May 1, 1996, the 
term does not include a supplier, materialman, distributor, or vendor of 
commercial items or commercial components.
    (6) Supplies means all property, except land and interests in land, 
that is clearly identifiable for eventual use by or owned by the DoD at 
the time of transportation by sea. (i) An item is clearly identifiable 
for eventual use by the DoD if, for example, the contract documentation 
contains a reference to a DoD contract number or a military destination.

[[Page 545]]

    (ii) Supplies includes (but is not limited to) public works; 
buildings and facilities; ships; floating equipment and vessels of every 
character, type, and description, with parts, subassemblies, 
accessories, and equipment; machine tools; material; equipment; stores 
of all kinds; end items; construction materials; and components of the 
foregoing.
    (7) U.S.-flag vessel means a vessel of the United States or 
belonging to the United States, including any vessel registered or 
having national status under the laws of the United States.
    (b) The Contractor shall employ U.S.-flag vessels in the 
transportation by sea of any supplies to be furnished in the performance 
of this contract. The Contractor and its subcontractors may request that 
the Contracting Officer authorize shipment in foreign-flag vessels, or 
designate available U.S.-flag vessels, if the Contractor or a 
subcontractor believes that--
    (1) U.S.-flag vessels are not available for timely shipment;
    (2) The freight charges are inordinately excessive or unreasonable; 
or
    (3) Freight charges are higher than charges to private persons for 
transportation of like goods.
    (c) The Contractor must submit any request for use of other than 
U.S.-flag vessels in writing to the Contracting Officer at least 45 days 
prior to the sailing date necessary to meet its delivery schedules. The 
Contracting Officer will process requests submitted after such date(s) 
as expeditiously as possible, but the Contracting Officer's failure to 
grant approvals to meet the shipper's sailing date will not of itself 
constitute a compensable delay under this or any other clause of this 
contract. Requests shall contain at a minimum--
    (1) Type, weight, and cube of cargo;
    (2) Required shipping date;
    (3) Special handling and discharge requirements;
    (4) Loading and discharge points;
    (5) Name of shipper and consignee;
    (6) Prime contract number; and
    (7) A documented description of efforts made to secure U.S.-flag 
vessels, including points of contact (with names and telephone numbers) 
with at least two U.S.-flag carriers contacted. Copies of telephone 
notes, telegraphic and facsimile message or letters will be sufficient 
for this purpose.
    (d) The Contractor shall, within 30 days after each shipment covered 
by this clause, provide the Contracting Officer and the Division of 
National Cargo, Office of Market Development, Maritime Administration, 
U.S. Department of Transportation, Washington, DC 20590, one copy of the 
rated on board vessel operating carrier's ocean bill of lading, which 
shall contain the following information--
    (1) Prime contract number;
    (2) Name of vessel;
    (3) Vessel flag of registry;
    (4) Date of loading;
    (5) Port of loading;
    (6) Port of final discharge;
    (7) Description of commodity;
    (8) Gross weight in pounds and cubic feet if available;
    (9) Total ocean freight in U.S. dollars; and
    (10) Name of the steamship company.
    (e) The Contractor agrees to provide with its final invoice under 
this contract a representation that to the best of its knowledge and 
belief--
    (1) No ocean transportation was used in the performance of this 
contract;
    (2) Ocean transportation was used and only U.S.-flag vessels were 
used for all ocean shipments under the contract;
    (3) Ocean transportation was used, and the Contractor had the 
written consent of the Contracting Officer for all non-U.S.-flag ocean 
transportation; or
    (4) Ocean transportation was used and some or all of the shipments 
were made on non-U.S.-flag vessels without the written consent of the 
Contracting Officer. The Contractor shall describe these shipments in 
the following format:

                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                           Item Description       Contract Line Items            Quantity       
----------------------------------------------------------------------------------------------------------------
Total................................                                                                           
----------------------------------------------------------------------------------------------------------------

    (f) If the final invoice does not include the required 
representation, the Government will reject and return it to the 
Contractor as an improper invoice for the purposes of the Prompt Payment 
clause of this contract. In the event there has been unauthorized use of 
non-U.S.-flag vessels in the performance of this contract, the 
Contracting Officer is entitled to equitably adjust the contract, based 
on the unauthorized use.
    (g) The Contractor shall include this clause, including this 
paragraph (g) in all subcontracts under this contract, which exceed the 
simplified acquisition threshold in Part 13 of the Federal Acquisition 
Regulation.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 60 FR 61602, Nov. 30, 1995]



252.247-7024  Notification of transportation of supplies by sea.

    As prescribed in 247.573(c), use the following clause:

      Notification of Transportation of Supplies by Sea (NOV 1995)

    (a) The Contractor has indicated by the response to the solicitation 
provision, Representation of Extent of Transportation by

[[Page 546]]

Sea, that it did not anticipate transporting by sea any supplies. If, 
however, after the award of this contract, the Contractor learns that 
supplies, as defined in the Transportation of Supplies by Sea clause of 
this contract, will be transported by sea, the Contractor--
    (1) Shall notify the Contracting Officer of that fact; and
    (2) Hereby agrees to comply with all the terms and conditions of the 
Transportation of Supplies by Sea clause of this contract.
    (b) The Contractor shall include this clause, including this 
paragraph (b), revised as necessary to reflect the relationship of the 
contracting parties, in all subcontracts hereunder, except (effective 
May 1, 1996) subcontracts for the acquisition of commercial items or 
components.

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 60 FR 61603, Nov. 30, 1995]



252.247-7025  Reflagging or repair work.

    As prescribed in 247.573(d), use the following clause:

                  Reflagging or Repair Work (May 1995)

    (a) Definition.
    Reflagging or repair work, as used in this clause, means work 
performed on a vessel--
    (1) To enable the vessel to meet applicable standards to become a 
vessel of the United States; or
    (2) To convert the vessel to a more useful military configuration.
    (b) Requirement. Unless the Secretary of Defense waives this 
requirement, reflagging or repair work shall be performed in the United 
States or its territories, if the reflagging or repair work is 
performed--
    (1) On a vessel for which the Contractor submitted an offer in 
response to the solicitation for this contract; and
    (2) Prior to acceptance of the vessel by the Government.

                             (End of clause)

[60 FR 29503, June 5, 1995]



Sec. 252.248-7000  Preparation of value engineering change proposals.

    As prescribed in 248.270, use the following clause:

      Preparation of Value Engineering Change Proposals (May 1994)

    Prepare value engineering change proposals, for submission pursuant 
to the value engineering clause of this contract, in the format 
prescribed by the version of MIL-STD-973 in effect on the date of 
contract award.

                             (End of clause)

[59 FR 27677, May 27, 1994]



252.249-7000  Special termination costs.

    As prescribed in 249.501-70, use the following clause:

                  Special Termination Costs (Dec. 1991)

    (a) Definition.-- Special termination costs, as used in this clause, 
means only costs in the following categories as defined in part 31 of 
the Federal Acquisition Regulation (FAR)--
    (1) Severance pay, as provided in FAR 31.205-6(g);
    (2) Reasonable costs continuing after termination, as provided in 
FAR 31.205-42(b);
    (3) Settlement of expenses, as provided in FAR 31.205-42(g);
    (4) Costs of return of field service personnel from sites, as 
provided in FAR 31.205-35 and FAR 31.205-46(c); and
    (5) Costs in paragraphs (a) (1), (2), (3), and (4) of this clause to 
which subcontractors may be entitled in the event of termination.
    (b) Notwithstanding the Limitation of Cost/Limitation of Funds 
clause of this contract, the Contractor shall not include in its 
estimate of costs incurred or to be incurred, any amount for special 
termination costs to which the Contractor may be entitled in the event 
this contract is terminated for the convenience of the Government.
    (c) The Contractor agrees to perform this contract in such a manner 
that the Contractor's claim for special termination costs will not 
exceed $________. The Government shall have no obligation to pay the 
Contractor any amount for the special termination costs in excess of 
this amount.
    (d) In the event of termination for the convenience of the 
Government, this clause shall not be construed as affecting the 
allowability of special termination costs in any manner other than 
limiting the maximum amount of the costs payable by the Government.
    (e) This clause shall remain in full force and effect until this 
contract is fully funded.

                             (End of clause)



252.249-7001  [Reserved]



252.249-7002  Notification of anticipated contract termination or reduction.

    As prescribed in 249.7003(c), use the following clause:

[[Page 547]]

 Notification of Anticipated Contract Termination or Reduction(DEC 1996)

    (a) Definitions.
    Major defense program means a program that is carried out to produce 
or acquire a major system (as defined in 10 U.S.C. 2302(5)) (see also 
DoD 5000.2-R, Mandatory Procedures for Major Defense Acquisition 
Programs (MDAPs) and Major Automated Information System (MAIS) 
Acquisition Programs).
    Substantial reduction means a reduction of 25 percent or more in the 
total dollar value of funds obligated by the contract.
    (b) Section 1372 of the National Defense Authorization Act for 
Fiscal Year 1994 (Pub. L. 103-160) and Section 824 of the National 
Defense Authorization Act for Fiscal Year 1997 (Pub. L. 104-201) are 
intended to help establish benefit eligibility under the Job Training 
Partnership Act (29 U.S.C. 1661 and 1662) for employees of DoD 
contractors and subcontractors adversely affected by contract 
terminations or substantial reductions under major defense programs.
    (c) Notice to employees and state and local officials. Within 2 
weeks after the Contracting Officer notifies the Contractor that 
contract funding will be terminated or substantially reduced, the 
Contractor shall provide notice of such anticipated termination or 
reduction to--
    (1) Each employee representative of the Contractor's employees whose 
work is directly related to the defense contract; or
    (2) If there is no such representative, each such employee;
    (3) The State dislocated worker unit or office described in section 
311(b)(2) of the Job Training Partnership Act (29 U.S.C. 1661(b)(2)); 
and
    (4) The chief elected official of the unit of general local 
government within which the adverse effect may occur.
    (d) Notice to subcontractors. Not later than 60 days after the 
Contractor receives the Contracting Officer's notice of the anticipated 
termination or reduction, the Contractor shall--
    (1) Provide notice of the anticipated termination or reduction to 
each first-tier subcontractor with a subcontract of $500,000 or more; 
and
    (2) Require that each such subcontractor--
    (i) Provide notice to each of its subcontractors with a subcontract 
of $100,000 or more; and
    (ii) Impose a similar notice and flowdown requirement to 
subcontractors with subcontracts of $100,000 or more.
    (e) The notice provided an employee under paragraph (c) of this 
clause shall have the same effect as a notice of termination to the 
employee for the purposes of determining whether such employee is 
eligible for training, adjustment assistance, and employment services 
under section 325 or 325A of the Job Training Partnership Act (29 U.S.C. 
1662d, 1662d-1). If the Contractor has specified that the anticipated 
contract termination or reduction is not likely to result in plant 
closure or mass layoff, as defined in 29 U.S.C. 2101, the employee shall 
be eligible only for services under section 314(b) and paragraphs (1) 
through (14), (16), and (18) of section 314(c) of the Job Training 
Partnership Act (29 U.S.C. 1661c(b) and paragraphs (1) through (14), 
(16), and (18) of section 1661c(c)).

                             (End of clause)

[61 FR 64637, Dec. 6, 1996]



252.251-7000  Ordering from Government supply sources.

    As prescribed in 251.107, use the following clause:

           Ordering From Government Supply Sources (May 1995)

    (a) When placing orders under Federal Supply Schedules or Personal 
Property Rehabilitation Price Schedules, the Contractor shall follow the 
terms of the applicable schedule and authorization. Include in each 
order:
    (1) A copy of the authorization (unless a copy was previously 
furnished to the Federal Supply Schedule or Personal Property 
Rehabilitation Price Schedule contractor).
    (2) The following statement: This order is placed under written 
authorization from ____________ dated ____________.

In the event of any inconsistency between the terms and conditions of 
this order and those of your Federal Supply Schedule contract or 
Personal Property Rehabilitation Price Schedule contract, the latter 
will govern.
    (3) The completed address(es) to which the Contractor's mail, 
freight, and billing documents are to be directed.
    (b) If a Federal Supply Schedule contractor refuses to honor an 
order placed by a Government contractor under an agency authorization, 
the Contractor shall report the circumstances to the General Services 
Administration, FFN, Washington, DC 20406, with a copy to the 
authorizing office.
    (c) When placing orders under nonmandatory schedule contracts and 
requirements contracts, issued by the General Services Administration 
(GSA) Office of Information Resources Management, for automated data 
processing equipment, software and maintenance, communications equipment 
and supplies, and teleprocessing services, the Contractor shall follow 
the terms of the applicable contract and the procedures in paragraph (a) 
of this clause.
    (d) When placing orders for Government stock, the Contractor shall--

[[Page 548]]

    (1) Comply with the requirements of the Contracting Officer's 
authorization, using FEDSTRIP or MILSTRIP procedures, as appropriate;
    (2) Use only the GSA Form 1948-A, Retail Services Shopping Plate, 
when ordering from GSA Self-Service Stores;
    (3) Order only those items required in the performance of Government 
contracts; and
    (4) Pay invoices from Government supply sources promptly. For 
purchases made from DoD supply sources, this means within 30 days of the 
date of a proper invoice (see also Defense Federal Acquisition 
Regulation Supplement (DFARS) 251.105). For purposes of computing 
interest for late Contractor payments, the Government's invoice is 
deemed to be a demand for payment in accordance with the Interest clause 
of this contract. The Contractor's failure to pay may also result in the 
DoD supply source refusing to honor the requisition (see DFARS 
251.102(f)) or in the Contracting Officer terminating the Contractor's 
authorization to use DoD supply sources. In the event the Contracting 
Officer decides to terminate the authorization due to the Contractor's 
failure to pay in a timely manner, the Contracting Officer shall provide 
the Contractor with prompt written notice of the intent to terminate the 
authorization and the basis for such action. The Contractor shall have 
10 days after receipt of the Government's notice in which to provide 
additional information as to why the authorization should not be 
terminated. Such termination shall not provide the Contractor with an 
excusable delay for failure to perform or complete the contract in 
accordance with the terms of the contract, and the Contractor shall be 
solely responsible for any increased costs.
    (e) Only the Contractor may request authorization for subcontractor 
use of Government supply sources. The Contracting Officer will not grant 
authorizations for subcontractor use without approval of the Contractor.
    (f) Government invoices shall be submitted to the Contractor's 
billing address, and Contractor payments shall be sent to the Government 
remittance address specified below:

Contractor's Billing Address (include point of contact and telephone 
number):

Government Remittance Address (include point of contact and telephone 
number):

                             (End of clause)

[56 FR 36479, July 31, 1991, as amended at 60 FR 29503, June 5, 1995]



252.251-7001  Use of Interagency Fleet Management System (IFMS) vehicles and related services.

    As prescribed in 251.205, use the following clause:

 Use of Interagency Fleet Management System (IFMS) Vehicles and Related 
                          Services (Dec. 1991)

    (a) The Contractor, if authorized use of IFMS vehicles, shall submit 
requests for five or fewer vehicles and related services in writing to 
the appropriate General Services Administration (GSA) Regional Customer 
Service Bureau, Attention: Motor Equipment Activity. Submit requests for 
more than five vehicles to GSA headquarters: General Services 
Administration, FTM, Washington, DC 20406. Include the following in each 
request:
    (1) Two copies of the agency authorization to obtain vehicles and 
related services from GSA.
    (2) The number of vehicles and related services required and the 
period of use.
    (3) A list of the Contractor's employees authorized to request 
vehicles and related services.
    (4) A list of the makes, models, and serial numbers of Contractor-
owned or leased equipment authorized to be serviced.
    (5) Billing instructions and address.
    (b) The Contractor should make requests for any unusual quantities 
of vehicles as far in advance as possible.
    (c) The Contractor shall establish and enforce suitable penalties 
for employees who use or authorize the use of Government vehicles for 
other than performance of Government contracts.
    (d) The Contractor shall assume, without the right of reimbursement 
from the Government, the cost or expense of any use of IFMS vehicles and 
services not related to the performance of the contract.
    (e) Only the Contractor may request authorization for subcontractor 
use of IFMS vehicles. The Contracting Officer will not grant 
authorization for subcontractor use without approval of the Contractor.

                             (End of clause)



PART 253--FORMS--Table of Contents




Sec.

                  Subpart 253.2--Prescription of Forms

253.204  Administrative matters.
253.204-70  DD Form 350, Individual Contracting Action Report.
253.204-71  DD Form 1057, Monthly Contracting Summary of Actions $25,000 
          or Less.

[[Page 549]]

253.208  Required sources of supplies and services.
253.208-1  DD Form 448, Military Interdepartmental Purchase Request.
253.208-2  DD Form 448-2, Acceptance of MIPR.
253.209  Contractor qualifications.
253.209-1  Responsible prospective contractors.
253.213  Small purchase and other simplified purchase procedures (SF's 
          18, 30, 44, 1165, OF's 347, 348).
253.213-70  Instructions for completion of DD Form 1155.
253.215  Contracting by negotiation.
253.215-70  DD Form 1547, Record of Weighted Guidelines Application.

    Authority:  41 U.S.C. 421 and 48 CFR chapter 1.

    Source:  56 FR 36554, July 31, 1991, unless otherwise noted.



                  Subpart 253.2--Prescription of Forms



253.204  Administrative matters.



253.204-70  DD Form 350, Individual Contracting Action Report.

    Policy on use of a DD Form 350 is in 204.670-2. This subsection 
253.204-70 contains instructions for completion of Parts A through F of 
the DD Form 350. Paragraph (g) of this subsection contains special 
instructions for completing a DD Form 350 for an action of $25,000 or 
less under the Small Business Competitiveness Demonstration Program.
    (a) Part A of the DD Form 350. Part A identifies the report and the 
reporting activity. Complete all four blocks.
    (1) BLOCK A1, TYPE OF REPORT. Enter one of the following codes:
    (i) Codes 0--Original. Enter code 0 unless code 1 or code 2 applies.
    (ii) Code 1--Cancelling. A cancelling action cancels an existing DD 
Form 350 in accordance with departmental data collection point 
instructions.
    (iii) Code 2--Correcting. A correcting action corrects an existing 
DD Form 350 action in accordance with departmental data collection point 
instructions.
    (2) BLOCK A2, REPORT NO. Enter the four-digit local control number 
(see 204.670-3(a)(4)). If Block A1 is coded 1 or 2, use the prior report 
number rather than a new one.
    (3) BLOCK A3, CONTRACTING OFFICE CODE. Enter the code assigned the 
contracting office by the departmental data collection point in 204.670-
1(c).
    (4) BLOCK A4, NAME OF CONTRACTING OFFICE. Enter sufficient detail to 
establish the identity of the contracting office.
    (b) Part B of the DD Form 350. Part B identifies the transaction.
    (1) BLOCK B1, CONTRACT IDENTIFICATION INFORMATION. Do not leave any 
parts of Block B1 blank.
    (i) BLOCK B1A, CONTRACT NUMBER.
    (A) Enter--
    (1) The DoD contract number; or
    (2) For orders under contracts awarded by other Federal agencies, 
the contract number of that Federal agency as it appears in the 
contractual instrument.
    (B) Do not leave spaces between characters, and do not enter dashes, 
slants, or any other punctuation marks.
    (C) The DoD contract number is the basic (13 alphanumeric character) 
procurement instrument identification number (PIIN) that was assigned in 
accordance with 204.7001 or constructed under an exception permitted by 
204.7000. Do not enter any supplemental procurement instrument 
identification numbers as part of the contract number (these go in Block 
B2).
    (ii) BLOCK B1B, ORIGIN OF CONTRACT. Enter the code that indicates 
the agency that originated/assigned the contract number.
    (A) Code A--DoD.
    (B) Code B--NASA.
    (C) Code C--Other non-DoD agency.
    (2) BLOCK B2, MODIFICATION, ORDER OR OTHER ID NUMBER. Enter the 
supplementary procurement instrument identification number (if there is 
one) that was assigned in accordance with 204.7004 or as permitted by 
204.7000. It can be up to 19 characters. Usually calls and orders have a 
four-position number (see 204.7004-4) and modifications (including 
modifications of calls or orders) have a six-position modification 
number (see 204.7003 or 204.7004(b)).
    (3) BLOCK B3, ACTION DATE.
    (i) Enter the year, month, and day of the effective date for fiscal 
obligation

[[Page 550]]

purposes. When contract actions are awarded contingent on the 
availability of funds, enter the date funds are obligated.
    (ii) Enter four digits for the year, two digits for the month, and 
two digits for the day. Use 01 through 12 for January through December. 
For example, enter January 2, 2003, as 20030102.
    (4) BLOCK B4, COMPLETION DATE.
    (i) Enter year, month, and day of the last contract delivery date or 
the end of the performance period. If the contract is incrementally 
funded, report the completion date for the entire contract. Report the 
completion date associated with an option quantity when the option is 
exercised.
    (ii) Enter four digits for the year, two digits for the month, and 
two digits for the day. Use 01 through 12 for January through December. 
For example, enter January 2, 2003, as 20030102.
    (5) BLOCK B5, CONTRACTOR IDENTIFICATION INFORMATION.
    (i) Use data that relates to the contractor whose name and address 
appears in the contract document (Block 7 of the SF 26, Award/Contract; 
Block 8 of the SF 30, Amendment of Solicitation/Modification of 
Contract; Block 15A of the SF 33, Solicitation, Offer and Award; or 
Block 9 of the DD Form 1155, Order for Supplies or Services), except--
    (A) For contracts placed with the Small Business Administration 
under Section 8(a) of the Small Business Act, use data that relates to 
the company that will be performing the work.
    (B) For Federal schedule orders, use data that applies to the 
contractor whose name appears on the schedule (not the data for the 
agent to whom orders may be sent).
    (C) For contracts with the Canadian Commercial Corporation (CCC), 
use data for the appropriate CCC office.
    (ii) Some of the parts of Block B5 may not apply to the action being 
reported. Follow the instructions for each part.
    (A) BLOCK B5A, CONTRACTOR IDENTIFICATION NUMBER. Enter the 
contractor's 9-position Data Universal Numbering System (DUNS) number 
(see FAR 4.602(d) and 4.603).
    (B) BLOCK B5B, GOVERNMENT AGENCY. Enter one of the following codes:
    (1) Code Y--Yes. Enter code Y when the contractor is a Federal/
State/Local government agency.
    (2) Code N--No. Enter code N when code Y does not apply.
    (C) BLOCK B5C, CAGE CODE. Enter the 5-position commercial and 
Government entity (CAGE) code that identifies the contractor plant or 
establishment. If the CAGE code is not already available in the 
contracting office and the apparent awardee does not respond to the 
provision at 252.204-7001, Commercial and Government Entity (CAGE) Code 
Reporting, use the procedures at 204.7202-1 to obtain one.
    (D) BLOCK B5D, CONTRACTOR NAME AND DIVISION NAME. Enter the 
contractor's name as stated in the offer and resultant contract. Include 
its division name.
    (E) BLOCK B5E, CONTRACTOR ADDRESS. Enter the contractor's address as 
stated in the offer and resultant contract. Include street address (and/
or P.O. Box), city/town, state/country, and ZIP code, if applicable. Do 
not enter foreign postal codes.
    (F) BLOCK B5F, TIN. Enter the contractor's taxpayer identification 
number (see FAR subpart 4.9). Leave Block B5F blank if the contractor 
is--
    (1) A nonresident alien, foreign corporation, or foreign partnership 
that does not have income effectively connected with the trade or 
business in the United States; and does not have an office or place of 
business or a fiscal paying agent in the United States;
    (2) An agency or instrumentality of a foreign government
    (3) An agency or instrumentality of a Federal, State, or local 
government.
    (G) BLOCK B5G, PARENT TIN. Enter the contractor's parent company 
(common parent) TIN (see FAR subpart 4.9 and 52.204-3). If the 
contractor does not have a parent company or the parent company meets 
the exemption for Block B5F, leave Block B5G blank.
    (H) BLOCK B5H, PARENT NAME. If a parent company TIN is entered in 
Block B5G, enter in Block B5H the name of the parent company (common 
parent). Leave Block B5H blank if

[[Page 551]]

there is no parent company or the parent company is exempted from the 
requirement to have a TIN.
    (6) BLOCK B6, PRINCIPAL PLACE OF PERFORMANCE.
    (i) The place, or places, where the contract will be performed may 
be specified by the Government or listed by the contractor in response 
to the solicitation provision at FAR 52.214-14, Place of Performance--
Sealed Bidding, or FAR 52.215-20, Place of Performance. Use data for the 
contractor's principal place of performance, which is generally the--
    (A) Final assembly point for supply contracts with manufacturers.
    (B) Dealer's location for supply contracts with regular dealers (FAR 
22.601) where shipment is made from stock.
    (C) Subcontractor's location for supply contracts with regular 
dealers (FAR 22.601) where shipment is made from a subcontractor's 
plant.
    (D) Actual construction site for construction contracts.
    (E) Planned construction site for architect-engineer contracts.
    (F) Place of mining for mined supplies.
    (G) Place (including military installations) where a service is 
performed for service contracts.
    (ii) When there is more than one location for any of paragraphs (i) 
(A) through (G) (e.g., more than one construction site), use the 
location involving the largest dollar amount of the acquisition. Do not 
show more than one location in Block B6.
    (iii) If places of performance are too varied or not known, or if 
commercial procedures were used, enter the contractor's home office 
location.
    (iv) Follow the instructions for each part of Block 6 which applies 
to the action being reported.
    (A) BLOCK B6A, CITY OR PLACE CODE.
    (1) For places in the United States and outlying areas, enter the 
numeric place code, which can be found in the Federal Information 
Processing Standards (FIPS) Publication (PUB) 55-2, (``Guideline: Codes 
for named Populated Places, Primary Country Divisions, and Other 
Locational Entities of the United States and Outlying Areas''). Leave 
Block B6A blank for places outside the United States and outlying areas.
    (2) If the city or locality is not listed, look in FIPS PUB 55-2 for 
the county code of the principal place of performance. Enter that in 
Block B6A. Use 50000 for Washington, DC, with a State code of 11.
    (3) Paragraph 5.2, Entry Selection With the Aid of the Class Code, 
of FIPS PUB 55-2 will help in selecting the correct code. Sometimes, a 
class code should be used in addition to a place code to accurately 
identify the place of performance. Do not use place codes when the first 
position of the class code is X or Z.
    (B) BLOCK B6B, STATE OR COUNTRY CODE.
    (1) For places in the United States and outlying areas, enter the 
numeric State code, which can be found in FIPS PUB 55-2 or FIPS PUB 5-2, 
Codes for the Identification of the States, the District of Columbia and 
the Outlying Areas of the United States and Associated Areas.
    (2) For places outside the United States and outlying areas, enter 
the alpha country code from FIPS PUB 10-3, Countries, Dependencies, 
Areas of Special Sovereignty, and Their Principal Administrative 
Divisions.
    (C) BLOCK B6C, CITY OR PLACE AND STATE OR COUNTRY NAME. Enter the 
name of the principal place of performance. Do not leave Block B6C 
blank.
    (7) BLOCK B7, TYPE OBLIGATION. Enter one of the following codes:
    (i) Code 1--Obligation. Enter code 1 if the contracting action 
obligates funds.
    (ii) Code 2--Deobligation. Enter code 2 if the contracting action 
deobligates funds.
    (8) BLOCK B8, TOTAL DOLLARS. Enter the net amount of funds (whole 
dollars only) obligated or deobligated by the contracting action. Do not 
leave Block B8 blank.
    (9) BLOCK B9, FOREIGN MILITARY SALE. Enter one of the following 
codes. If only part of the contracting action is a foreign military 
sale, separately report the parts (see 204.670-6(c)).
    (i) Code Y--Yes. Enter code Y when the contracting action is under a 
foreign military sales arrangement, or

[[Page 552]]

under any other arrangement when a foreign country or international 
organization is bearing the cost of the acquisition.
    (ii) Code N--No. Enter code N when code Y does not apply.
    (10) BLOCK B10, MULTIYEAR CONTRACT. Enter one of the following 
codes:
    (i) Code Y--Yes. Enter code Y when the contracting action is a 
multiyear contract as defined at FAR 17.103. Do not report contracts 
containing options as multiyear unless the definition at FAR 17.103 
applies to the contract.
    (ii) Code N--No. Enter code N when code Y does not apply.
    (11) BLOCK B11, TOTAL MULTIYEAR VALUE. Enter total multiyear value 
only at the time of initial obligation of the multiyear funds. 
Therefore, enter the estimated total multiyear contract value (whole 
dollars only) if the contracting action is--
    (i) A multiyear contract (B10 is coded Y); and
    (ii) Either a new letter contract or a new definitive contract 
(Block B13A is coded 1 or 3 and Block B13D is blank). For all other 
codes in Block B13A, enter a numeric value of zero in Block B11.
    (12) BLOCK B12, PRINCIPAL PRODUCT OR SERVICE. Block B12 contains 
five parts. Do not leave any parts of Block B12 blank.
    (i) BLOCK B12A, FSC OR SVC CODE. Enter the 4-character federal 
supply classification (FSC) or service code that describes the contract 
effort. To find the code, look in Section I of the Department of Defense 
(DoD) Procurement Coding Manual (MN02). There are three categories of 
codes to choose from. In some cases, use a 4-character code from a list 
of 4-character codes; in other cases, construct a code using the 
instructions in the Manual. If more than one category or code applies to 
the contracting action, enter the one that best identifies the product 
or service representing the largest dollar value.
    (A) Supplies. If the contracting action is for the purchase (not 
lease or rental) of supplies, enter an FSC code in Block B12A. FSC codes 
are all numeric. Look in Section I, Part C, of the DoD Procurement 
Coding Manual (MN02). The Department of Defense Federal Supply 
Classification Cataloging Handbooks H2-1, H2-2, and H2-3 may also help 
with the correct 4-digit code.
    (B) Services. If the contracting action is for services (except 
research, development, test, and evaluation), construction, or lease or 
rental of equipment or facilities, enter a service code in Block B12A.
    (C) Research, Development, Test and Evaluation (RDT&E). If the 
contracting action is for RDT&E (as defined in FAR 35.001 and 235.001), 
enter an RDT&E code in Block B12A. Look in Section I, Part A, of the DoD 
Procurement Coding Manual (MN02). All RDT&E codes should begin with the 
letter ``A''. Do not use an RDT&E code for--
    (1) Purchase, lease, or rental of equipment, supplies, or services 
separately purchased in support of RDT&E work, even if RDT&E funds are 
cited. Instead, use an FSC or Service code under the instructions in 
paragraphs (i) (A) or (B).
    (2) Orders under Federal Schedule contracts. Instead, use an FSC or 
Service code under the instructions in paragraphs (i) (A) or (B).
    (ii) BLOCK B12B, DOD CLAIMANT PROGRAM CODE. Enter a code that 
identifies the commodity described in Block B12E. These codes are in 
Section III of the DoD Procurement Coding Manual (MN02). If more than 
one code applies to the contracting action, enter the one that best 
identifies the product or service representing the largest dollar value. 
If the description in Block B12E is for--
    (A) Research and development (R&D), enter the code that best 
represents the objective of the R&D. For example, if the objective of 
the research and development is a guided missile, enter code A20. If the 
R&D cannot be identified to any particular objective, enter code S10.
    (B) Ship repair, inspect and repair as necessary (IRAN), 
modification of aircraft, overhaul of engines, or similar maintenance, 
repair or modification services, enter the code that best identifies the 
program.
    (C) Equipment rental (including rental of automated data processing 
equipment), enter code S10.
    (D) Utility services, enter code S10.

[[Page 553]]

    (E) Services that cannot be identified to any listed program, enter 
code S10.
    (F) Supplies or equipment that cannot be identified to any listed 
program, enter code C9E.
    (iii) BLOCK B12C PROGRAM, SYSTEM OR EQUIPMENT CODE.
    (A) Enter a code that describes the program, weapons system or 
equipment. These codes are in Section II of the DoD Procurement Coding 
Manual (MN02). If there is no code that applies to the contracting 
action, enter three zeros. If more than one code applies to the action, 
enter the one that best identifies the product or service representing 
the largest dollar value.
    (B) If the contracting action is funded by the Ballistic Missile 
Defense Organization, enter code CAA.
    (C) If the contracting action supports environmental cleanup 
programs, enter one of the codes listed in Section II of the DoD 
Procurement Coding Manual (MN02) under the heading ``Description and Use 
of Program Codes--Environmental Cleanup Programs.''
    (D) Defense Logistics Agency activities must use the code assigned 
by the sponsoring service.
    (iv) BLOCK B12D, SIC CODE.
    Enter the standard industrial classification (SIC) code for the 
acquisition (as opposed to the SIC of the manufacturer or dealer). Use 
the SIC code in effect at the time of award. These codes are in the OMB 
Standard Industrial Classification Manual. If more than one code applies 
to the contracting action, enter the one that best identifies the 
product or service representing the largest dollar value.
    (v) BLOCK B12E, NAME/DESCRIPTION. Enter the name or brief 
description of the commodity or service. If the description is 
classified, enter only the work ``Classified.'' Do not, however, use 
``Classified'' when a code name (e.g., Minuteman, Polaris, Trident, 
Pershing, etc.) or an identifying program number (e.g., WS-107A) can be 
used.
    (13) BLOCK B13, KIND OF CONTRACTING ACTION. Some of the parts of 
Block B13 may not apply to the action being reported. Follow 
instructions for each part. When the contracting action is a 
modification, complete Blocks B13A and B13D.
    (i) BLOCK B13A, CONTRACT/ORDER. Enter one of the following codes:
    (A) Code 1--Letter Contract. Enter code 1 when the contracting 
action is a letter contract. When the contracting action is a 
modification to a letter contract that has not been definitized, enter 
code 1 in B13A.
    (B) Code 3--Definitive Contract. Enter code 3 when the contracting 
action is the award of a definitive contract. When the contracting 
action definitizes a letter contract or is a modification to a 
definitive contract, enter code 3 in B13A. Code 3 includes the 
following:
    (1) Definitive contract awards under the Small Business 
Administration 8(a) program.
    (2) Notices of award.
    (3) Lease agreements.
    (4) Indefinite delivery-definite quantity contracts (FAR 52.216-20).
    (5) Indefinite delivery-indefinite quantity contracts (FAR 52.216-
22) when funds are obligated by the contract itself.
    Code 3 excludes orders from the Procurement List (see codes 6 and 
8).
    (C) Code 4--Order under an Agreement. Enter code 4 when the 
contracting action is an order or definitization of an order under an 
agreement other than a blanket purchase agreement. Examples include an 
order exceeding $25,000 under a basic ordering agreement or a master 
ship repair agreement and a job order when the contract is created by 
issuing the order. A call under a blanket purchase agreement associated 
with a Federal Supply Schedule, pursuant to FAR 13.202(c)(3), is coded 
6. A call under other blanket purchase agreements, pursuant to FAR 
subpart 13.2, is coded 9. When the contracting action is a modification 
to an order described in code 4 instructions, enter code 4 in B13A.
    (D) Code 5--Order under Indefinite Delivery Contract (IDC). Enter 
code 5 when the contracting action is an order, including task or 
delivery order, under an indefinite delivery contract awarded by a 
Federal agency. For example, code 5 is to be entered for an order under 
a GSA indefinite delivery contract such as a GSA area-wide contract for 
utility services, which is not a Federal schedule. When the contracting 
action is a modification to an order described in

[[Page 554]]

code 5 instructions, enter code 5 in B13A.
    (E) Code 6--Order/Call under Federal Schedule. Enter code 6 if the 
contracting action is a blanket purchase agreement call established with 
a Federal schedule contractor pursuant to FAR 13.202(c)(3), or an order 
under a--
    (1) Federal schedule (e.g., GSA, VA, or OPM) contract (FAR 8.401); 
or
    (2) GSA ADP schedule contract. Code 6 includes orders from the 
Procurement List under Federal schedules. When the contracting action is 
a modification to an order/call described in code 6 instructions, enter 
code 6 in B13A.
    (F) Code 8--Order from Procurement List. Enter code 8 if the 
contracting action is an action placed with Federal Prison Industries 
(UNICOR) or a JWOD Participating Nonprofit Agency in accordance with FAR 
subpart 8.6 or 8.7. When the contracting action is a modification to an 
action described in code 8 instructions, enter code 8 in B13A.
    (G) Code 9--Purchase Order/Call. Enter code 9 if the contracting 
action, including an action in a designated industry group under the 
Small Business Competitiveness Demonstration Program (FAR subpart 
19.10), is an award pursuant to FAR part 13, except when the contracting 
action is a blanket purchase agreement call pursuant to FAR 13.202(c)(3) 
(see code 6). When the contracting action is a modification to a 
purchase order/call described in code 9 instructions, enter code 9 in 
B13A.
    (ii) BLOCK B13B, TYPE OF INDEFINITE DELIVERY CONTRACT. If Block B13A 
is coded 3 and the ninth position of B1A is coded D, complete Block 
B13B. If Block B13A is coded 5, complete Block B13B. Otherwise, leave 
blank.
    (A) Code A--Requirements Contract (FAR 52.216-21).
    (B) Code B--Indefinite Quantity Contract (FAR 52.216-22).
    (C) Code C--Definite Quantity Contract (FAR 52.216-20).
    (iii) BLOCK B13C, MULTIPLE/SINGLE AWARD IDC(S). If Block B13B is 
coded A, B, or C, complete Block B13C. Otherwise, leave blank.
    (A) Code M--Multiple Award. Enter code M if the contracting action 
is a task or delivery order under a multiple award indefinite delivery 
contract.
    (B) Code S--Single Award. Enter code S if the contracting action is 
a task or delivery order under a single award indefinite delivery 
contract.
    (iv) BLOCK B13D, MODIFICATION. If this action is a modification, 
enter one of the following codes. Otherwise, leave blank.
    (A) Code A--Additional Work (new agreement). Enter code A when the 
contracting action is a bilateral supplemental agreement which obligates 
funds for additional work requiring a justification and approval (J&A).
    (B) Code B--Additional Work (other). Enter code B when the 
contracting action is a modification of an existing contract (including 
a letter contract) which is not covered by code A or by codes C through 
H. (See code H for exercise of an option.) Code B includes actions 
which--
    (1) Initiate an incremental yearly buy under a multiyear contract;
    (2) Amend a letter or other contract to add work that does not 
require a J&A or
    (3) Order under a priced exhibit or production list.
    (C) Code C--Funding Action. Enter code C when the contracting action 
is a modification (to a letter or other contract) for the sole purpose 
of obligating or deobligating funds. This includes--
    (1) Incremental funding (other than incremental yearly buys under 
multiyear contracts, which are coded B);
    (2) Changes to the estimated cost on cost-reimbursement contracts;
    (3) Repricing actions covering incentive price revisions;
    (4) Economic price adjustments; and
    (5) Initial citation and obligation of funds for a contract awarded 
in one fiscal year but not effective until a subsequent fiscal year.
    (D) Code D--Change Order. Enter code D if the contracting action is 
a change order issued under the ``Changes,'' ``Differing Site 
Conditions,'' or similar clauses in existing contracts.
    (E) Code E--Termination for Default. Enter code E if the contracting 
action is a modification which terminates all or part of the contract 
for default.
    (F) Code F--Termination for Convenience. Enter code F if the 
contracting

[[Page 555]]

action is a modification which terminates all or part of the contract 
for convenience.
    (G) Code G--Cancellation. Enter code G if the contracting action is 
a modification which cancels the contract. Do not use code G to cancel a 
prior DD Form 350--see Block A1.
    (H) Code H--Exercise of an Option. Enter code H if the contracting 
action is an exercise of an option.
    (I) Code J--Definitization of a Letter Contract. Enter code J if the 
contracting action is the definitization of a letter contract.
    (14) BLOCK B14, CICA APPLICABILITY. Enter one of the following 
codes;
    (i) Code A--Pre-CICA. Enter code A if the action resulted from a 
solicitation issued before April 1, 1985. Modifications within the 
original scope of work of such awards and orders under pre-CICA 
indefinite delivery type contracts are reported as pre-CICA. In case of 
modifications issued on or after April 1, 1985, coded A in B13 or B13D, 
as appropriate, CICA is applicable to the modification, and these 
actions shall be coded B in Block B14.
    (ii) Code B--CICA Applicable. Enter code B if the action resulted 
from a solicitation issued on or after April 1, 1985, and none of the 
following codes applies.
    (iii) Code C--Simplified Acquisition Procedures Other than FAR 
subpart 13.6. Enter code C if the action resulted from use of the 
procedures in FAR part 13, other than those in subpart 13.6.
    (iv) Code D--Simplified Procedures Pursuant to FAR subpart 13.6. 
Enter code D if the action resulted from use of the procedures in FAR 
subpart 13.6.
    (c) Part C of the DD Form 350.
    (1) Part C gathers data concerning contracting procedures, use of 
competition, financing, and statutory requirements other than 
socioeconomic (which are in Part D).
    (2) Do not complete Part C if the contracting action is an action 
with a government agency, i.e., Block B5B (Government Agency) is coded Y 
(Yes). If Block B13A is coded 6, do not complete any blocks in Part C 
except Block C3, and Blocks C13A and C13B when they apply.
    (3) In completing Part C, the codes to be used describe either the 
contracting action being reported or the original contract, depending on 
the codes reported in blocks B13A and B13D.
    (i) If Block B13A is coded 1, 2, 3, 4, 6, or 9 and Block B13D is 
coded A or is blank, code the blocks in Part C with reference to the 
action being reported. Otherwise, code the blocks with reference to the 
original contract.
    (ii) If there are no codes for the original contract because a DD 
Form 350 was not required at the time, the original action is no longer 
available, the definition of the original code has changed, or a data 
element has been added to the system after the original contract report, 
then use codes that best describe the original contracting action.
    (4) Complete Part C blocks as follows:
    (i) BLOCK C1, SYSNOPSIS. Enter one of the following codes:
    (A) Code A--Synopsis Only. Enter code A if only a synopsis of the 
proposed action was prepared and transmitted to the Commerce Business 
Daily in accordance with FAR subpart 5.2.
    (B) Code B--Combined Synopsis/Solicitation. Enter code B if a 
combined synopsis/solicitation of the proposed action was prepared and 
transmitted to the Commerce Business Daily in accordance with FAR 
subpart 5.2 and 12.603.
    (C) Code N--No. Enter code N if a synopsis was not prepared.
    (ii) BLOCK C2, REASON NOT SYNOPSIZED. Enter one of the following 
codes if Block C1 is coded N. Otherwise, leave Block C2 blank.
    (A) Code A--Urgency. Enter code A if the action was not synopsized 
due to urgency (see FAR 6.302-2).
    (B) Code B--Use of FACNET. Enter code B if the action was not 
synopsized due to use of FACNET for the acquisition.
    (C) Code Z--Other Reason. Enter code Z if the action was not 
synopsized due to some other reason.
    (iii) BLOCK C3, EXTENT COMPETED. Enter one of the following codes:
    (A) Code A--Competed Action. Enter code A when--
    (1) The contracting action is an action under a Federal Schedule 
contract (Block B13A is coded 6).

[[Page 556]]

    (2) Competitive procedures were used to fulfill the requirement for 
full and open competition (FAR subpart 6.1).
    (3) Full and open competition procedures after exclusion of sources 
were used in order to establish/maintain alternative sources, to set 
aside an acquisition for small business, or to compete section 8(a) 
awards (FAR subpart 6.2).
    (4) Statutory authorities for other than full and open competition 
were used (FAR subpart 6.3) and more than one offer was received (if 
only one offer was received, use code D).
    (5) Contracting action resulted from a contract awarded prior to the 
Competition in Contracting Act that used two-step sealed bidding or 
other sealed bidding, or that was negotiated competitively.
    (6) Simplified acquisition procedures were used and competition was 
obtained.
    (B) Code B--Not Available for Competition. Enter code B for--
    (1) Awards for utilities or utility systems, excluding long distance 
telecommunications services, when only one supplier can furnish the 
service (FAR 6.302-1(b)(3)).
    (2) Brand name commercial products for authorized resale.
    (3) Acquisitions authorized or required by statute to be awarded to 
a specific source pursuant to FAR 6.302-5(b) (2) or (4), e.g., qualified 
nonprofit agencies employing people who are blind or severely disabled 
(FAR subpart 8.7) or 8(a) program (FAR subpart 19.8).
    (4) International agreements and Foreign Military Sales when the 
acquisition is to be reimbursed by a foreign country that requires that 
the product or services be obtained from a particular firm as specified 
in official written direction such as a Letter of Offer and Acceptance.
    (5) Other contract actions when the Director of Defense Procurement 
has determined that there is no opportunity for competition.Q 
P='04'
(Note: Even though Part C is not completed for actions with a government 
agency, the database will automatically include these actions in the 
category of not available for competition.)

    (C) Code C--Follow-on to Competed Action. Enter code C when the 
action pertains to an acquisition placed with a particular contractor to 
continue or augment a specific competed program when such placement was 
necessitated by prior acquisition decisions.
    (D) Code D--Not Competed. Enter code D when codes A, B, or C do not 
apply.
    (iv) BLOCK C4, SEA TRANSPORTATION. Enter one of the following codes 
when Block B1B is coded A, Block B5B is coded N, and Block B13A is coded 
other than 9. Otherwise, leave Block C4 blank.
    (A) Code Y--Yes--Positive Response to 252.247-7022 or 252.212-
7000(c)(2). Enter code Y when the contractor's response to the provision 
at 252.247-7022, Representation of Extent of Transportation by Sea, or 
252.212-7000(c)(2), Offeror Representations and Certifications--
Commercial Items, indicates that the contractor anticipates that some of 
the supplies being provided may be transported by sea.
    (B) Code N--No--Negative Response to 252.247-7022 or 252.212-
7000(c)(2). Enter code N when the contractor's response to the provision 
at 252.247-7022 or 252.212-7000(c)(2) indicates that the contractor 
anticipates that none of the supplies being provided will be transported 
by sea.
    (C) Code U--Unknown--No Response or Provision Not Included in
    Solicitation. Enter code U when the contractor did not complete the 
representation at 252.247-7022 or 252.212-7000(c)(2) or the solicitation 
did not include either provision.
    (v) BLOCK C5, TYPE OF CONTRACT.
    (A) If the action is a letter contract, including modifications and 
amendments to letter contracts, enter the code that describes the 
anticipated type of contract the letter contract will become when it is 
definitized.
    (B) If there is more than one type of contract involved in the 
contracting action, enter the code that matches the type with the most 
dollars. If the type with the least dollars exceeds $500,000, fill out 
separate DD Forms 350 (with different report numbers) for each type.
    (C) Enter one of the following codes:
    (1) Code A--Fixed-Price Redetermination.
    (2) Code J--Firm-Fixed-Price.

[[Page 557]]

    (3) Code K--Fixed-Price Economic Price Adjustment.
    (4) Code L--Fixed-Price Incentive.
    (5) Code R--Cost-Plus-Award-Fee.
    (6) Code S--Cost Contract.
    (7) Code T--Cost-Sharing.
    (8) Code U--Cost-Plus-Fixed-Fee.
    (9) Code V--Cost-Plus-Incentive-Fee.
    (10) Code Y--Time-and-Materials.
    (11) Code Z--Labor-Hour.
    (vi) BLOCK C6, NUMBER OF OFFERORS SOLICITED.
    (A) Leave Block C6 blank if--
    (1) The original contract resulted from a solicitation issued before 
April 1, 1985, (i.e., before the effective date of the Competition in 
Contracting Act);
    (2) Block B1B is coded B or C and Block B13A is coded 5; or
    (3) Block B13A is coded 6.
    (B) Otherwise, enter--
    (1) Code 1--One. Enter code 1 if only one offeror was solicited.
    (2) Code 2--More than One. Enter code 2 if more than one offeror was 
solicited.
    (vii) BLOCK C7, NUMBER OF OFFERS RECEIVED.
    (A) Leave Block C7 blank if--
    (1) The original contract resulted from a solicitation issued before 
April 1, 1985 (i.e., before the effective date of the Competition in 
Contracting Act); or
    (2) Block B13A is coded 6, Order Under Federal Schedule.
    (B) Otherwise, enter the specific number of offers received (maximum 
999).
    (viii) BLOCK C8, SOLICITATION PROCEDURES.
    (A) Leave Block C8 blank if--
    (1) The original contract resulted from a solicitation issued before 
April 1, 1985 (i.e., before the effective date of the Competition in 
Contracting Act);
    (2) The action is pursuant to simplified acquisition procedures 
(Block B13A is coded 9); or
    (3) The action is an order/call under a Federal schedule (Block B13A 
is coded 6.
    (B) Otherwise, enter one of the following codes:
    (1) Code A--Full and Open Competition--Sealed Bid. Enter code A if 
the action resulted from an award pursuant to FAR 6.102(a).
    (2) Code B--Full and Open Competition--Competitive Proposal. Enter 
code B if the action resulted from an award pursuant to FAR 6.102(b).
    (3) Code C--Full and Open Competition--Combination. Enter code C if 
the action resulted from an award using a combination of competitive 
procedures (e.g., two-step sealed bidding) pursuant to FAR 6.102(c).
    (4) Code D--Architect-Engineer. Enter code D if the action resulted 
from selection of sources for architect-engineer contracts pursuant to 
FAR 6.102(d)(1).
    (5) Code E--Basic Research. Enter code E if the action resulted from 
competitive selection of basic research proposals pursuant to FAR 
6.102(d)(2).
    (6) Code F--Multiple Award Schedule. Enter code F is the action is 
an award of a multiple award schedule pursuant to FAR 6.102(d)(3) or an 
order against such a schedule.
    (7) Code G--Alternative Sources. Enter code G if the action resulted 
from use of competitive procedures but excluded a particular source 
pursuant to FAR 6.202(a).
    (8) Code K--Set-Aside. Enter code K if the action resulted from 
any--
    (i) Set-aside for small business concerns (see FAR 6.203) including 
small business innovation research (SBIR) actions and awards to 
qualified nonprofit agencies employing people who are blind or severely 
disabled which were participating in a set-aside for small business 
concerns (see FAR 19.501(h)).
    (ii) Set-aside for small disadvantaged business concerns (see 
206.203).
    (iii) Total or partial set-asides (including portions of broad 
agency announcements (BAAs)) for historically black colleges and 
universities or minority institutions (see 206.203 and 235.016).
    (iv) Competition among section 8(a) firms under FAR 19.805 (report 
noncompetitive 8(a) awards as code N).
    (9) Code M. [Reserved]
    (10) Code N--Other Than Full and Open Competition. Enter code N if 
the action resulted from use of other than full and open competition 
pursuant to FAR subpart 6.3. This includes awards to qualified nonprofit 
agencies employing people who are blind or severely disabled (see FAR 
subpart 8.7) or noncompetitive

[[Page 558]]

awards to the Small Business Administration under Section 8(a) of the 
Small Business Act (see FAR 6.302-5(b)).
    (ix) BLOCK C9, AUTHORITY FOR OTHER THAN FULL AND OPEN COMPETITION.
    (A) Leave Block C9 blank if the original contract resulted from a 
solicitation issued before April 1, 1985 (i.e., before the effective 
date of the Competition in Contracting Act).
    (B) Enter one of the following codes if Block C8 is coded ``N.'' 
Otherwise, leave Block C9 blank.
    (1) Code 1A--Unique Source. Enter code 1A if the action was 
justified pursuant to FAR 6.302-1(b)(1).
    (2) Code 1B--Follow-on Contract. Enter code 1B if the action was 
justified pursuant to FAR 6.302-1(a)(2) (ii) or (iii).
    (3) Code 1C--Unsolicited Research Prop. Enter code 1C if the action 
was justified pursuant to FAR 6.302-1(a)(2)(i).
    (4) Code 1D--Patent/Data Rights. Enter code 1D if the action was 
justified pursuant to FAR 6.302-1(b)(2).
    (5) Code 1E--Utilities. Enter code 1E if the action was justified 
pursuant to FAR 6.302-1(b)(3).
    (6) Code 1F--Standardization. Enter code 1F if the action was 
justified pursuant to FAR 6.302-1(b)(4).
    (7) Code 1G--Only One Source--Other. Enter code 1G if the action was 
justified pursuant to FAR 6.302-1 in a situation other than the examples 
cited in codes 1A through 1F.
    (8) Code 2A--Urgency. Enter code 2A if the action was justified 
pursuant to FAR 6.302-2.
    (9) Code 3A--Particular Source. Enter Code 3A if the action was 
justified pursuant to FAR 6.302-3(a)(2).
    (10) Code 4A--International Agreement. Enter code 4A if the action 
was justified pursuant to FAR 6.302-4.
    (11) Code 5A--Authorized by Statute. Enter code 5A if the action was 
justified pursuant to FAR 6.302-5(a)(2)(i).
    (12) Code 5B--Authorized Resale. Enter code 5B if the action was 
justified pursuant to FAR 6.302-5(a)(2)(ii).
    (13) Code 6A--National Security. Enter code 6A if the action was 
justified pursuant to FAR 6.302-6.
    (14) Code 7A--Public Interest. Enter code 7A if the action was taken 
pursuant to FAR 6.302-7.
    (x) BLOCK C10, SUBJECT TO LABOR STANDARDS STATUTES. Enter one of the 
following codes. When Block B13A is coded 6, leave Block C10 blank.
    (A) Code A--Walsh-Healey Act. Enter code A when the contracting 
action is subject to the provisions of FAR subpart 22.6.
    (B) Code C--Service Contract Act. Enter code C when the contracting 
action is subject to the provisions of the Service Contract Act (see FAR 
part 37).
    (C) Code D--Davis-Bacon Act. Enter code D when the contracting 
action is subject to the Davis-Bacon Act (see FAR 22.403-1).
    (D) Code Z--Not Applicable. Enter code Z when codes A, C, or D do 
not apply.
    (xi) BLOCK C11, CERTIFIED COST OR PRICING DATA. Enter one of the 
following codes when Block B1B is coded A. Otherwise, leave blank.
    (A) Code Y--Yes--Obtained. Enter code Y when cost or pricing data 
were obtained (see FAR 15.804-2) and certified in accordance with FAR 
15.804-4.
    (B) Code N--No--Not Obtained. Enter code N when neither code Y nor 
code W applies.
    (C) Code W--Not Obtained--Waived. Enter code W when cost or pricing 
data were not obtained because the requirement was waived (see FAR 
15.804-1(a)(3) and 215.804-1(b)(4)).
    (xii) BLOCK C12, CONTRACT FINANCING. Enter one of the following 
codes identifying whether or not progress payments (PP), advance 
payments (AP), or other financing methods were used.
    (A) Code A--FAR 52.232-16. Enter code A if the contract contains the 
clause at FAR 52.232-16, Progress Payments.
    (B) Code B--DFARS 252.232-7003. Enter code B if the contract 
contains the clause at 252.232-7003, Flexible Progress Payments.
    (C) Code C--Percentage of Completion PP. Enter code C if the 
contract provides for progress payments based on percentage or stage of 
completion, which is only permitted on contracts for construction, for 
shipbuilding, or for ship conversion, alteration, or repair (see 
232.102(e)(2)).
    (D) Code D--Unusual PP or AP. Enter code D if the contract provides 
for unusual progress payments or advance

[[Page 559]]

payments (see FAR subpart 32.4 and 32.501-2).
    (E) Code E--Commercial Financing. Enter code E if the contract 
provides for commercial financing payments (see FAR subpart 32.2).
    (F) Code F--Performance-Based Financing. Enter code F if the 
contract provides for performance-based financing payments (see FAR 
subpart 32.10).
    (G) Code Z--Not Applicable. Enter code Z when codes A through F do 
not apply.
    (xiii) BLOCK C13, FOREIGN TRADE DATA.
    (A) The term ``United States'' (U.S.), as used in Block C13, 
excludes the Trust Territory of Palau (see 204.670-1 for definition of 
United States and outlying areas).
    (B) BLOCK C13A, PLACE OF MANUFACTURE. Complete Block C13A only if 
the contracting action is for a foreign end product or a service 
provided by a foreign concern. Otherwise, leave Block C13A blank.
    (1) Code A--U.S. Enter code A if the contracting action is for--
    (i) A foreign end product that is manufactured in the United States 
but still determined to be foreign because 50 percent or more of the 
cost of its components is not mined, produced, or manufactured inside 
the United States or inside qualifying countries; or
    (ii) Services performed in the United States by a foreign concern.
    (2) Code B--Foreign. Enter code B if the contracting action is for--
    (i) Any other foreign end product; or
    (ii) Services performed outside the Unites States by a foreign 
concern.
    (C) BLOCK C13B, COUNTRY OF ORIGIN CODE.
    (1) Complete Block C13B only if Block C13A is coded A or B. 
Otherwise, leave Block C13B blank.
    (2) Enter the code from FIPS PUB 10-3 (Countries, Dependencies, 
Areas of Special Sovereignty, and Their Principal Administrative 
Divisions) that identifies the country where the foreign product is 
coming from or where the foreign company providing the services is 
located. If more than one foreign country is involved, enter the code of 
the foreign country with the largest dollar value.
    (xiv) BLOCK C14, COMMERCIAL ITEMS. Enter one of the following codes:
    (A) Code Y--Yes. Enter code Y if the contract contains the clause at 
FAR 52.212-4, Contract Terms and Conditions--Commercial Items.
    (B) Code N--No. Enter code N if code Y does not apply
    (d) Part D of the DD Form 350.
    (1) Part D gathers data on the various socioeconomic programs that 
apply to defense acquisitions.
    (2) Do Not complete Part D if the contracting action is an--
    (i) Order/call under a Federal schedule, i.e., Block B13A is coded 
6; or
    (ii) Action with a government agency, i.e., Block B5B is coded Y.
    (3) Determined the status of the concern (e.g., size and ownership) 
by referring to FAR part 19 and DFARS part 219.
    (4) Use the codes in Blocks B13A and B13D to determine whether the 
codes in Part D will describes the contracting action being reported or 
the original contract.
    (i) Code Part D to describe the contracting action being reported 
when--
    (A) Block B13A is coded 1, 3, 4, or 9 and Block B13D is coded A or 
is blank; or
    (B) Block B5B is coded N, Block B13A is coded 8, and Block B13D is 
coded A or is blank. Otherwise, code Part D to describe the original 
contract.
    (ii) If there are no codes for the original contract because a DD 
Form 350 was not required at the time, the original action is no longer 
available, the definition of the original code has changed or a data 
element has been added to the system after the original contract report, 
then use codes that best describe the original contracting action.
    (5) Complete Part D blocks as follows:
    (i) BLOCK D1, TYPE OF BUSINESS. Enter one of the following codes:
    (A) Code A--Small Disadvantaged Business Performing in U.S. Enter 
code A if the contractor is an SDB concern as defined in 219.001 and the 
place of performance is within the United States and outlying areas.

[[Page 560]]

    (B) Code B--Other Small Business Performing in U.S. Enter code B if 
the contractor is a small business concern as defined in FAR 19.001, 
other than a small disadvantaged business concern, and the place of 
performance is within the United States and outlying areas.
    (C) Code C--Large Business Performing in U.S. Enter code C if the 
contractor is a domestic large business concern, and the place of 
performance is within the United States and outlying areas.
    (D) Code D--JWOD Participating Nonprofit Agencies. Enter code D if 
the contractor is a qualified nonprofit agency employing people who are 
blind or severely disabled (FAR 8.701), and the place of performance is 
within the United States and outlying areas.
    (E) Code F--Hospital. Enter code F if the contractor is a hospital, 
and the place of performance is within the United States and outlying 
areas.
    (F) Code L--Foreign Concern/Entity. Enter code L if the contractor 
is a foreign concern, the Canadian Commercial Corporation, or a non-
U.S.-chartered nonprofit institution.
    (G) Code M--Domestic Firm Performing Outside U.S. Enter code M if 
the contractor is a domestic concern or a domestic nonprofit institution 
and the place of performance is outside the United States and outlying 
areas.
    (H) Code U--Historically Black Colleges and Universities or Minority 
Institutions (HBCU/MI). Enter code U if the contractor is an HBCU/MI as 
defined at 252.226-7000 and the place of performance is within the 
United States and outlying areas.
    (I) Code V--Other Educational. Enter code V if the contractor is an 
educational institution which does not qualify as an HBCU/MI, and the 
place of performance is within the United States and outlying areas.
    (J) Code Z--Other Nonprofit. Enter code Z if the contractor is a 
nonprofit institution (defined in FAR 31.701) which does not meet any of 
the criteria in codes D, F, U, or V, and the place of performance is 
within the United States and outlying areas.
    (ii) BLOCK D2, REASON NOT AWARDED TO SMALL DISADVANTAGED BUSINESS 
(SDB). Enter one of the following codes when Block D1 is coded B or C. 
Otherwise, leave Block D2 blank.
    (A) Code A--No Known SDB Source.
    (B) Code B--SDB Not Solicited. Enter code B when there was a known 
SDB source, but it was not solicited.
    (C) Code C--SDB Solicited/No Offer. Enter code C when an SDB was 
solicited but it did not submit an offer or its offer was not sufficient 
to cover the total quantity requirement so it received a separate award 
for the quantity offered.
    (D) Code D--SDB Solicited/Offer Not Low. Enter code D when an SDB 
offer was not the low offer or an SDB was not willing to accept award of 
a partial small business set-aside portion of an action at the price 
offered.
    (E) Code Z--Other Reason. Enter code Z when an SDB did not receive 
the award for any other reason or when Block B1B is coded B or C and 
Block B13A is coded 5.
    (iii) BLOCK D3, REASON NOT AWARDED TO SMALL BUSINESS (SB). Enter one 
of the following codes when Block D1 is coded C. Otherwise, leave D3 
blank. (The term ``Small Business'' includes small disadvantaged 
businesses.)
    (A) Code A--No Known SB Source.
    (B) Code B--SB Not Solicited. Enter code B when there was a known 
small business source, but it was not solicited.
    (C) Code C--SB Solicited/No Offer. Enter code C when a small 
business concern was solicited but it did not submit an offer or its 
offer was not sufficient to cover the total quantity requirement so it 
received a separate award for the quantity offered.
    (D) Code D--SB Solicited/Offer Not Low. Enter code D when a small 
business offer was not the low or most advantageous offer or a small 
business concern was not willing to accept award of a set-aside portion 
of an action at the price offered by the Government.
    (E) Code Z--Other Reason. Enter code Z when a small business did not 
receive the award for any other reason or when Block B1B is coded B or C 
and Block B13A is coded 5.
    (iv) BLOCK D4, PREFERENCE PROGRAM.

[[Page 561]]

    (A) BLOCK D4A, TYPE OF SB SET-ASIDE. Enter one of the following 
codes:
    (1) Code A--None. Enter code A if there was no small business set-
aside (FAR 19.502). Note that set-asides for historically black colleges 
and universities and minority institutions (HBCUs/MIs) are not small 
business set-asides. Use code A for HBCU/MI set-asides and complete 
Block D4C.
    (2) Code B--Total SB Set-Aside. Enter code B if the action was a 
total set-aside for small business (FAR 19.502-2), including actions 
reserved exclusively for small business concerns pursuant to FAR 13.105, 
or if the action resulted from the Small Business Innovation Research 
Program.
    (3) Code C--Partial SB Set-Aside. Enter code C if the action was a 
partial set-aside for small business (219.502-3).
    (4) Code E--Total SDB Set-Aside. Enter code E if the action was a 
total set-aside for small disadvantaged businesses (219.502-2-70).
    (5) Code Y--Emerging Small Business Set-Aside. Enter code Y if the 
action was an emerging small business set-aside within a designated 
industry group under the Small Business Competitiveness Demonstration 
Program (FAR subpart 19.10 and DFARS 204.670-9).
    (B) BLOCK D4B--TYPE OF SDB SET-ASIDE/SDB PREFERENCE. Enter one of 
the following codes, even if Block D4A is coded E:
    (1) Code A--None. Enter code A if no SDB preference was given or 
award was not to an SDB.
    (2) Code B--Section 8(a). Enter code B if the contract was awarded 
to the Small Business Administration (SBA) under Section 8(a) of the 
Small Business Act (FAR subpart 19.8).
    (3) Code C--Total SDB Set-Aside. Enter code C if the action was an 
SDB set-aside (219.502-2-70) and award was to an SDB.
    (4) Code D--SDB Evaluation Preference--Unrestricted. Enter code D if 
the action was unrestricted but an SDB received an award as a result of 
an evaluation preference (subpart 219.70).
    (5) Code E--SDB Preferential Consideration--Partial SB Set-Aside. 
Enter code E if the action was a partial set-aside for small business 
and preferential consideration resulted in an award to an SDB (219.502-
3).
    (6) Code F--SDB Evaluation Preference in Construction. Enter code F 
if the action was a construction acquisition and preferential 
consideration resulted in an award to a SDB (subpart 219.72). If code F 
applies and Block B13D is blank, complete Blocks E1 and E3.
    (C) BLOCK D4C--HBCU/MI SET-ASIDE. Enter one of the following codes:
    (1) Code A--None. Enter code A if the action was not set aside for 
HBCUs or MIs.
    (2) Code B--HBCU or MI--Total Set-Aside. Enter code B if the action 
was total set-aside for HBCUs and MIs (226.7003).
    (3) Code C--HBCU or MI--Partial Set-Aside. Enter code C if the 
action was a partial set-aside for HBCUs or MIs under a broad agency 
announcement (235.016).
    (D) BLOCK D4D. [Reserved]
    (E) BLOCK D4E, PREMIUM PERCENT.
    (1) Complete Block D4E if Block B1B is coded A and--
    (i) Block D4B is coded C, D, or E; or
    (ii) Block D4C is coded B or C. Otherwise, leave blank.
    (2) Calculate the premium percentage per 219.202-5 and enter it as a 
three-digit number rounded to the nearest tenth, e.g., enter 7.55% as 
076. If no premium was paid, enter three zeros (000).
    (v) BLOCK D5--ETHNIC GROUP.
    (A) Complete Block D5 if the action is with an SDB. Otherwise, leave 
it blank.
    (B) Enter the code from the following list which corresponds to the 
ethnic group marked by the contractor in the solicitation provision at 
252.219-7000 (Small Disadvantaged Business Concern Representation (DoD 
Contracts)).
    (1) Code A--Asian-Indian American.
    (2) Code B--Asian-Pacific American.
    (3) Code C--Black American.
    (4) Code D--Hispanic American.
    (5) Code E--Native American.
    (6) Code F--Other SDB certified/determined by SBA.
    (7) Code Z--No representation.
    (vi) BLOCK D6, WOMEN-OWNED BUSINESS. Enter one of the following 
codes:

[[Page 562]]

    (A) Code Y--Yes. Enter code Y if the response to FAR 52.204-5 or 
52.212-3(c) (Women-Owned Business Representation) indicates that it is a 
women-owned business.
    (B) Code N--No. Enter code N if the contractor's response to FAR 
52.204-5 or 52.212-3(c) indicates that it is not a women-owned business.
    (C) Code U--Uncertified. Enter code U if the information is not 
available because the contractor did not complete the representation 
under FAR 52.204-5 or 52.212-3(c).
    (vii) BLOCK D7--SMALL BUSINESS INNOVATION RESEARCH (SBIR) PROGRAM. 
Enter one of the following codes. When Block B1B is coded B or C and 
Block B13A is coded 5, leave Block D7 blank.
    (A) Code A--Not a SBIR Program Phase I/II/III. Enter Code A if the 
action is not in support of a Phase I, II, or III SBIR program.
    (B) Code B--SBIR Program Phase I Action. Enter code B if the action 
is related to a Phase I contract in support of the SBIR Program.
    (C) Code C--SBIR Program Phase II Action. Enter code C if the action 
is related to a Phase II contract in support of the SBIR Program.
    (D) Code D--SBIR Program Phase III Action. Enter code D if the 
action is related to a Phase III contract in support of the SBIR 
Program.
    (viii) BLOCK D8, SUBCONTRACTING PLAN--SB, SDB, OR HBCU/MI. Enter one 
of the following codes:
    (A) Code A--Plan Not Included--No Subcontracting Possibilities. 
Enter code A if a subcontracting plan was not included in the contract 
because subcontracting possibilities do not exist (FAR 19.705-2(c)).
    (B) Code B--Plan Not Required. Enter code B if no subcontracting 
plan was required (because the action did not meet the dollar thresholds 
in FAR 19.702(b)).
    (C) Code C--Plan Required, Incentive Not Included. Enter code C if 
the action includes a subcontracting plan, but does not include 
additional incentives (FAR 19.708(c)).
    (D) Code D--Plan Required, Incentive Included. Enter code D if the 
action includes a subcontracting plan and also includes additional 
incentives (FAR 19.708(c), 219.708(c)).
    (ix) BLOCK D9, DEMONSTRATION TEST PROGRAM. Enter one of the 
following codes. When Block B13A is coded 5 or Block B13D is coded B, C, 
D, E, F, or G and the original action was awarded before the program 
began, enter code N in Block D9. When Block B1B is coded B or C and 
Block B13A is coded 5, enter code N in Block D9.
    (A) Code Y--Yes. Enter code Y if this is an action with a U.S. 
business concern, in either the four designated industry groups or the 
ten targeted industry categories under the Small Business 
Competitiveness Demonstration Program (FAR subpart 19.10 and DFARS 
subpart 219.10), where the principal place of performance is in the 
United States or outlying areas.
    (B) Code N--No. Enter code N if code Y does not apply.
    (x) BLOCK D10, SIZE OF SMALL BUSINESS.
    (A) Complete Block D10 only when Block D9 is coded ``Y'' and the 
contractor is a small business (Block D1 is coded A or B). Otherwise, 
leave Block D10 blank.
    (B) Enter one of the following codes for the size of the business 
(number of employees or average annual gross revenue) as represented by 
the contractor in the solicitation provision at FAR 52.219-19, Small 
Business Concern Representation for the Small Business Competiveness 
Demonstration Program:
    (1) Code A--50 or fewer.
    (2) Code B--51-100.
    (3) Code C--101-250.
    (4) Code D--251-500.
    (5) Code E--501-750.
    (6) Code F--751-1,000.
    (7) Code G--Over 1,000.
    (8) Code M--$1,000,000 or less.
    (9) Code N--$1,000,001-2,000,000.
    (10) Code P--$2,000,001-3,500,000.
    (11) Code R--$3,500,001-5,000,000.
    (12) Code S--$5,000,001-10,000,000.
    (13) Code T--$10,000,001-17,000,000.
    (14) Code U--Over $17,000,000.
    (xi) BLOCK D11, EMERGING SMALL BUSINESS.
    (A) Complete this block only if Block D9 is coded ``Y'' and the 
contracting action is in one of the four designated

[[Page 563]]

industry groups, not one of the targeted industry categories. Otherwise, 
leave Block D11 blank.
    (B) Enter one of the following codes:
    (1) Code Y--Yes. Enter code Y if the contractor represents in the 
provision at FAR 52.219-19, Small Business Concern Representation for 
the Small Business Competitiveness Demonstration Program, that it is an 
emerging small business concern.
    (2) Code N--No. Enter code N if code Y does not apply.
    (e) Part E of the DD Form 350. Part E gathers data on specialized 
items that may not become permanent reporting elements.
    (1) BLOCK E1, PREFERENCE AWARD VALUE.
    (i) Complete Block E1 if code F was entered in Block D4B and Block 
B13D is blank. Otherwise, leave Block E1 blank.
    (ii) Enter the dollar amount (i.e., contract face value) of the 
award. Use whole dollars.
    (2) BLOCK E2, SET-ASIDE VALUE.
    (i) Complete Block E2 only if the contracting action is with a 
qualified nonprofit agency employing people who are blind or severely 
disabled and was awarded as a result of the agency's participation in a 
total or partial small business set-aside (FAR 19.501(h)). Otherwise, 
leave Block E2 blank.
    (ii) Enter the dollar amount (i.e., contract face value) of the set-
aside portion of the award. Use whole dollars.
    (3) BLOCK E3, NEXT LOW OFFER.
    (i) Complete Block E3 only if Block E1 or E2 is completed. 
Otherwise, leave Block E3 blank.
    (ii) If Block E1 or E2 is completed--
    (A) Enter the offered price from the small business firm that would 
have been the low offeror if qualified nonprofit agencies employing 
people who are blind or severely disabled had not participated in the 
acquisition; or
    (B) If the evaluation preference for small disadvantaged business 
concerns in construction acquisitions set forth in subpart 219.72 is 
applied, enter the offered price from the non-SDB concern that would 
have been the successful offeror if the evaluation preference had not 
been applied. Enter the amount in whole dollars.
    (4) Block E4--CONTINGENCY OPERATION. Enter code Y in Block E4 if the 
contracting action is in support of a contingency operation, as defined 
in 213.101, and the action exceeds the simplified acquisition threshold 
for contingency operations (see 213.000). Otherwise, leave Block E4 
blank.
    (5) BLOCK E5--BLOCK E8--RESERVED.
    (f) Part F of the DD Form 350. Part F identifies the reporting 
official.
    (1) BLOCK F1, NAME OF CONTRACTING OFFICER OR REPRESENTATIVE. Enter 
the name (Last, First, Middle Initial) of the contracting officer or 
representive.
    (2) BLOCK F2, SIGNATURE. The person identified in Block F1 must 
sign.
    (3) BLOCK F3, TELEPHONE NUMBER. Enter the telephone number (with 
area code) for the individual in Block F1. Installations with Defense 
Switched Network (DSN) must enter the DSN number.
    (4) BLOCK F4, DATE. Enter date that the DD Form 350 Report is 
submitted. Enter four digits for the year, two digits for the month, and 
two digits for the day. Use 01 through 12 for January through December. 
For example, enter January 2, 2003, as 20030102.
    (g) Special Instructions for DD Forms 350 on Actions of $25,000 or 
Less Under the Small Business Competitiveness Demonstration Program.
    (1) A DD Form 350 is required on actions of $25,000 or less under 
the Small Business Competitiveness Demonstration Program in accordance 
with 204.670-9.
    (2) Except as provided in paragraphs (g)(2)(i) and (ii) of this 
subsection, complete the DD Form 350 using the instructions in 
paragraphs (a) through (f) of this subsection.
    (i) Enter code B in Block C3 for actions at or below the micro-
purchase threshold at FAR 2.101.
    (ii) Leave the following blocks blank:

BIB
B4
B5B
B5C
B5F
B5G
B5H
B9
B10

[[Page 564]]

B11
B12B
B12C
C1
C2
C4
C6
C11
C12
C13A
C13B
D2
D3
D4E
D5
D7
D8
E2
E3
[61 FR 51032, Sept. 30, 1996, as amended at 62 FR 34135, June 24, 1997; 
62 FR 44222, Aug. 20, 1997; 62 FR 48182, Sept. 15, 1997; 62 FR 49304, 
Sept. 19, 1997]



253.204-71  DD Form 1057, Monthly Contracting Summary of Actions $25,000 or Less.

    (a) Scope of subsection. Policy on use of a DD Form 1057 is in 
204.670. This subsection contains instructions on completion of the DD 
Form 1057.
    (1) Report actions in the month they are awarded, issued, executed, 
or placed, except--
    (i) When the price of an order or call cannot be determined when it 
is placed, count the action and its dollars when it is paid.
    (ii) Count the following actions when the voucher is paid (count 
each voucher as one action):
    (A) Meals and lodging.
    (B) Automatic deliveries, e.g., bread, milk, and ice cream.
    (iii) The Navy Facilities Engineering Command shall report vouchers 
it processes on Naval shore establishment contracts for electricity and 
gas in accordance with departmental procedures.
    (2) Enter all dollar amounts in whole dollars only. Do not enter 
cents. If the net amount is a decrease, enter a minus sign (-) 
immediately preceding the amount to indicate a credit entry. Do not 
enter parentheses.
    (3) Report actions of $25,000 or less in support of a contingency 
operation in accordance with the instructions in paragraphs (c) through 
(j) of this subsection. Report actions exceeding $25,000 but not 
exceeding $200,000 in support of a contingency operation (see 213.000) 
on the monthly DD Form 1057 as follows:
    (i) Section B; the applicable lines are 5, 5a, 7, and 7a.
    (ii) Section C; the applicable lines are 1 and 1c, 2 and 2c, and 3 
and 3c.
    (iii) Sections D, E, and F, are not applicable.
    (iv) Section G; complete fully.
    (b) Definitions. For purposes of this subsection--
    All Other Orders means orders, and modifications of such orders, 
under basic ordering agreements (BOAs) or indefinite delivery contracts.
    GSA Schedule Orders means only orders/calls, and modifications of 
such orders/calls, under Federal schedules awarded by GSA.
    Other Contracting Actions means all actions that do not meet the 
definitions, in this paragraph (b), of an order.
    Other Federal Schedule Orders means only orders, and modifications 
of such orders, under Federal schedules awarded by an agency other than 
GSA, e.g., awarded by VA or OPM.
    Similified Acquisition Procedures means purchase orders, calls under 
blanket purchase agreements (BPAs) (except BPAs written under Federal 
schedules), and modifications to those actions.
    (c) Section A, General Information.
    (1) BLOCK A1, REPORT FOR MONTH ENDING. Enter the last day of the 
month in which the report is submitted. Enter four digits for the year, 
two digits for the month, and two digits for the day. Use 01 through 12 
for January through December. For example, enter January 31, 2003, as 
20030131.
    (2) BLOCK A2, CONTRACTING OFFICE. Enter sufficient detail to 
establish the identity of the contracting office submitting the report 
in Blocks 2a and b.
    (3) BLOCK A3, REPORTING OFFICE CODE. Enter the code assigned to the 
contracting office by the departmental data collection point in 204.670-
8.
    (d) Section B, Contracting Actions.
    (1) BLOCK B1, TARIFF OR REGULATED ACQUISITIONS. Enter the number and 
dollar value of contracting actions (including modifications that

[[Page 565]]

will also be reported in Block B8) with tariff or regulated industries 
(industries with sole source and service rates which are fixed or 
adjusted by a Federal, State, or other public regulatory body).
    (2) BLOCK B2, FOREIGN/INTERAGENCY.
    (i) Enter the total number and dollar value of contracting actions 
(including modifications that will also be reported in Block B8)--
    (A) For foreign military sales (FMS) or other arrangement where the 
foreign government or international organization is paying all or part 
of the cost of the action.
    (B) Placed directly with foreign governments under the terms of an 
international agreement, e.g., base maintenance performed with the 
foreign government acting as the contractor (any other actions directly 
with foreign governments go in Block B5).
    (C) With another Federal agency or Government corporation, e.g., 
Federal Prison Industries (UNICOR).
    (ii) Enter the subtotals in Blocks B2a, b, and c for the number and 
dollar value of contracting actions, including modifications that will 
also be reported in Block B8 for--
    (A) Block B2a, FMS/International Agreements. Enter subtotals for 
paragraphs (d)(2)(i)(A) and (B) of this subsection.
    (B) Block B2b, Action with UNICOR. Enter subtotal for contracting 
actions with UNICOR.
    (C) Block B2c, Action with Other Government Agency. Enter subtotal 
for action with government agencies other than UNICOR.
    (3) BLOCK B3, SMALL BUSINESS.
    (i) Enter the total number and total dollar value of contracting 
actions (including modifications which will also be reported in Block 
B8) where the--
    (A) Contractor is a small business concern; and
    (B) Place of performance is in the United States and outlying areas 
(see 204.670-1).
    (ii) Enter the subtotals for the number and dollar value of 
contracting actions (including modifications that will also be reported 
in Block B8) for--
    (A) Block B3a, Simplified Acquisition Procedures (SAP).
    (B) Block B3b, GSA Schedule Orders.
    (C) Block B3c, Other Federal Schedule Orders.
    (D) Block B3d, All Other Orders.
    (E) Block B3e, Other Contracting Actions.
    (4) BLOCK B4, LARGE BUSINESS.
    (i) Enter the total number and dollar value of contracting actions 
(including modifications which will also be reported in Block B8) where 
the--
    (A) Contractor is a large business concern; and
    (B) Place of performance is in the United States and outlying areas.
    (ii) Enter the subtotals for the number and dollar value of 
contracting actions (including modifications that will also be reported 
in Block B8) for--
    (A) Block B4a, Simplified Acquisition Procedures (SAP).
    (B) Block B4b, GSA Schedule Orders.
    (C) Block B4c, Other Federal Schedule Orders.
    (D) Block B4d, All Other Orders.
    (E) Block B4e, Other Contracting Actions.
    (5) BLOCK B5, DOMESTIC OR FOREIGN ENTITIES PERFORMING OUTSIDE THE 
UNITED STATES.
    (i) Enter the total number and dollar value of contracting actions 
(including modifications that will also be reported in Block B8) where 
the place of performance is outside the United States and outlying areas 
(see 204.670-1(c)). This includes actions placed directly with a foreign 
government that are not under international agreements (see paragraph 
(d)(2)(i)(B) of this subsection). It does not matter whether the 
contractor is domestic or foreign.
    (ii) Enter the subtotals for the number and dollar value of actions 
(including modifications that will also be reported in Block B8) for--
    (A) Block B5a, Simplified Acquisition Procedures (SAP).
    (B) Block B5b, GSA Schedule Orders.
    (C) Block B5c, Other Federal Schedule Orders.
    (D) Block B5d, All Other Orders.
    (E) Block B5e, Other Contracting Actions.
    (6) BLOCK B6, EDUCATIONAL, NONPROFIT & OTHER.
    (i) Enter the total number and dollar value of contracting actions 
(including

[[Page 566]]

modifications that will also be reported in Block B8) with--
    (A) Educational institutions;
    (B) Not-for-profit and nonprofit institutions (defined in FAR 
31.701);
    (C) Qualified nonprofit agencies employing people who are blind or 
severely disabled; and
    (D) Any other entities not listed in Blocks B1 through B5.
    (ii) Enter the subtotals for the number and dollar value of 
contracting actions (including modifications that will also be reported 
in Block B8) for--
    (A) Block B6a, Simplified Acquisition Procedures (SAP).
    (B) Block B6b, GSA Schedule Orders.
    (C) Block B6c, Other Federal Schedule Orders.
    (D) Block B6d, All Other Orders.
    (E) Block B6e, Other Contracting Actions.
    (7) BLOCK B7, TOTAL CONTRACTING ACTIONS.
    (i) Add Blocks B1 through B6 and enter the totals in Block B7.
    (ii) If directed by data collection point procedures, also enter the 
subtotals for the number and dollar value of contracting actions for--
    (A) Block B7a, Simplified Acquisition Procedures, sum of sub-blocks 
3a+4a+5a+6a.
    (B) Block B7b, GSA Schedule Orders, sum of sub-blocks 3b+4b+5b+6b.
    (C) Block B7c, Other Federal Schedule Orders, sum of sub-blocks 
3c+4c+5c+6c.
    (D) Block B7d, All Other Orders, sum of sub-blocks 3d+4d+5d+6d.
    (E) Block B7e, Other Contracting Actions, sum of sub-blocks 
3e+4e+5e+6e.
    (8) BLOCK B8, TOTAL MODIFICATIONS EXCLUDING SIMPLIFIED ACQUISITION 
PROCEDURES. Enter the total number and dollar value of modification 
actions, excluding simplified acquisition procedures.
    (e) Section C, Extent Competed.
    (1) BLOCK C1, COMPETED.
    (i) Enter the total number and dollar value of contracting actions 
which were competed.
    (A) Include in Block C1--
    (1) Actions not subject to Competition in Contracting Act (CICA) 
(see FAR 6.001) when at least two quotations or offers were received;
    (2) Actions when competitive procedures were used to fulfill the 
requirement for full and open competition (FAR subpart 6.1);
    (3) Actions when full and open competition was provided for after 
exclusion of source, to establish/maintain alternative sources or to set 
aside an acquisition exceeding the micro-purchase threshold for small 
business (FAR Subpart 6.2);
    (4) Actions when statutory authorities for other than full and open 
competition (FAR subpart 6.3) were used and more than one offer was 
received, except as provided in paragraphs (e)(1)(i)(B) (2) and (3) of 
this subsection;
    (5) Actions resulting from a contract awarded competitively before 
CICA (including two-step formal advertising);
    (6) Orders/calls and modifications under a Federal schedule; and
    (7) Section 8(a) awards competed under FAR 6.204.
    (B) Do not include--
    (1) Actions that meet the criteria for Section C, Block C2;
    (2) Actions awarded under the authority of FAR 6.302-5(b) (2) or 
(4), authorized or required by statute (report these in Section C, Block 
C2); or
    (3) Actions reported in Section B, Blocks B1 and B2, including 
actions with the Federal Prison Industries (UNICOR). These actions are 
treated as not available for competition in published competition 
reports.
    (ii) Enter the subtotals for the number and dollar value of 
contracting actions for--
    (A) Block C1a, Small Business Concerns;
    (B) Block C1b, Large Business Concerns;
    (C) Block C1c, Domestic or Foreign Entities Performing Outside the 
United States and Outlying Areas; and
    (D) Block C1d, Educational, Nonprofit & Other.
    (2) BLOCK C2, NOT AVAILABLE FOR COMPETITION.
    (i) Enter the total number and dollar value of contracting actions 
which were not available for competition.
    (A) Include in Block C2--
    (1) Actions for brand name commercial products for authorized 
resale;
    (2) Actions authorized or required by statute to be awarded to a 
specific

[[Page 567]]

source or through another agency in accordance with FAR 6.302-5(b) (2) 
or (4); e.g., actions with qualified nonprofit agencies employing people 
who are blind or severely disabled, and noncompetitive 8(a) actions;
    (3) Actions (including modifications) at or below the micro-purchase 
threshold at FAR 2.101; and
    (4) Other contract actions when the Director of Defense Procurement 
has determined that there is no opportunity for competition.
    (B) Do not include any actions reported in Section B, Blocks B1 or 
B2 (e.g., actions with regulated monopolies, actions under foreign 
military sales or international agreements, and actions with another 
Federal agency or Government corporation). These actions are treated as 
not available for competition in published competition reports.
    (ii) Enter the subtotals for the number and dollar value of 
contracting actions for--
    (A) Block C2a, Small Business Concerns;
    (B) Block C2b, Large Business Concerns;
    (C) Block C2c, Domestic or Foreign Entities Performing Outside the 
United States; and
    (D) Block C2d, Educational, Nonprofit and Other.
    (3) BLOCK C3, NOT COMPETED.
    (i) Enter the total number and dollar value of contracting actions 
which were not competed, i.e., any actions not reported in Blocks B1 or 
B2. Do not include actions reported in Section B, Blocks B1 or B2. These 
actions are treated as not available for competition in published 
competition reports.
    (ii) Enter the subtotals for the number and dollar value of actions 
for--
    (A) Block C3a, Small Business Concerns;
    (B) Block C3b, Large Business Concerns;
    (C) Block C3c, Domestic or Foreign Entities Performing Outside the 
United States and Outlying Areas; and
    (D) Block C3d, Educational, Nonprofit & Other.
    (f) Section D, Research, Development, Test, & Evaluation Actions. Do 
not include actions for supplies or services in support of RDT&E work 
that do not require the contractor to perform RDT&E.
    (1) BLOCK D1, SMALL BUSINESS. Enter the total number and dollar 
values of RDT&E actions with small business concerns.
    (2) BLOCK D2, LARGE BUSINESS. Enter the total number and dollar 
value of RDT&E actions with large business concerns.
    (3) BLOCK D3, DOMESTIC OR FOREIGN ENTITIES PERFORMING OUTSIDE THE 
UNITED STATES AND OUTLYING AREAS. Enter the total number and dollar 
value of RDT&E actions where the principal place of performance is 
outside the United States or outlying areas (see 204.670-1).
    (4) BLOCK D4, HISTORICALLY BLACK COLLEGES & UNIVERSITIES OR MINORITY 
INSTITUTIONS (HBCU/MI). Enter the total number and dollar value of RDT&E 
actions with HBCUs or MIs.
    (5) BLOCK D5, OTHER ENTITIES. Enter the total number and dollar 
value of RDT&E actions that were reported in Blocks D1 through D4.
    (g) Section E, Selected Socioeconomic Statistics.
    (1) BLOCK E1, SMALL BUSINESS (SB) SET-ASIDE.
    (i) Enter the total number and dollar value of contracting actions 
which were small business set-aside actions, including awards to SDBs 
reported in Blocks E2c and E2d.
    (ii) If the action is an emerging small business set-aside (FAR 
19.1006(c)), use the most appropriate sub-block.
    (iii) Enter the subtotals for the number and total dollar value of 
actions for--
    (A) Block Ela, SB Set-aside Using Simplified Acquisition Procedures.
    Enter actions pursuant to FAR 13.105(a).
    (B) Block E1b, SB Set-Aside. Enter actions pursuant to FAR 19.502.
    (2) BLOCK E2, SMALL DISADVANTAGED BUSINESS (SDB) ACTIONS.
    (i) Enter the total number and dollar value of actions which were 
small disadvantaged business actions.
    (ii) Enter the subtotals for the number and dollar value for--
    (A) Block E2a, Through SBA-Section 8(a). Enter actions with the 
Small Business Administration pursuant to

[[Page 568]]

Section 8(a) of the Small Business Act (FAR subpart 19.8).
    (B) Block E2b, SDB Set-Aside/SDB Preference. Enter actions resulting 
from--
    (1) A set-aside for small disadvantaged business (SDB) (219.502-2-
70);
    (2) Application of an SDB evaluation preference (subpart 219.70); or
    (3) SDB preferential consideration (219.502-3).
    (C) Block E2c, SB Set-aside Using Simplified Acquisition Procedures. 
Enter actions pursuant to FAR 13.105(a) when award is to an SDB, but a 
preference was not applied.
    (D) Block E2d, SB Set-Aside. Enter actions under FAR 19.502 when 
award is to an SDB, but a preference was not applied nor was 
preferential consideration given.
    (E) Block E2e, Other. Enter awards to SDB concerns when award is to 
an SDB not reported in Blocks E2a through E2d.
    (3) BLOCK E3, WOMEN-OWNED SMALL BUSINESS. Enter total number and 
dollar value of contracting actions with women-owned small businesses 
(see FAR 19.304(a)).
    (4) BLOCK E4, HBCU/MI. Enter the total number and dollar value of 
contracting actions with HBCU/MIs pursuant to subpart 226.70.
    (5) BLOCK E5, JWOD PARTICIPATING NONPROFIT AGENCIES. Enter the total 
number and dollar value of contracting actions with qualified nonprofit 
agencies employing people who are blind or severely disabled for 
supplies or services from the Procurement List pursuant to FAR subpart 
8.7.
    (6) BLOCK E6, EXEMPT FROM SMALL BUSINESS ACT REQUIREMENTS. Enter the 
total number and dollar value of contracting actions exempt from the 
set-aside requirements of the Small Business Act (see FAR 19.502-1).
    (h) Section F, Simplified Acquisition Procedures--Dollar Value 
Ranges. Enter in each of the dollar ranges the total number and dollar 
value of contracting actions which used simplified acquisition 
procedures (FAR part 13). The total of Section F is normally the sum of 
Blocks B3a, B4a, B5a, and B6a.
    (i) Section G, Contingency Actions.
    BLOCK G1, TOTAL ACTIONS.
    (1) Enter the total number and dollar value of actions in support of 
a contingency operation (see 213.000). The numbers entered here are a 
breakout of the numbers already entered in Sections B and C.
    (2) Enter the subtotals based on the instructions for completion of 
Section C for the number and dollar value of contracting actions for--
    (i) Block G1a, Competed;
    (ii) Block G1b, Not Available for Competition; and
    (iii) Block G1c, Not Competed.
    (j) Section H, Remarks and Authentication.
    (1) BLOCK H1, REMARKS. Enter any remarks applicable to this report.
    (2) Block H2, CONTRACTING OFFICER.
    (i) Block H2a, Typed Name. Enter the name (last, first, middle 
initial) of the contracting officer or representative.
    (ii) Block H2b, Signature. The person identified in Block H2a must 
sign.
    (iii) Block H2c, Telephone Number. Enter the telephone number (with 
area code) of the person identified in Block H2a. Installations with 
Defense Switched Network (DSN) must enter their DSN number.
    (3) BLOCK H3, DATE REPORT SUBMITTED. Enter the date that the DD Form 
1057 is submitted. Enter four digits for the year, two digits for the 
month and two digits for the day. Use 01 through 12 for January through 
December. For example, enter January 2,2003, as 20030102.
[61 FR 51040, Sept. 30, 1996, as amended at 62 FR 34136, June 24, 1997; 
62 FR 44223, Aug. 20, 1997; 62 FR 49304, Sept. 19, 1997]



253.208  Required sources of supplies and services.



253.208-1  DD Form 448, Military Interdepartmental Purchase Request.

    (a) Use the DD Form 448 as prescribed in subpart 208.70.
    (b) Prepare MIPR information in uniform contract format when 
possible. Overprint of fixed repetitive information is authorized.
    (c) Instructions for completion of DD Form 448. (1) BLOCK 5--MIPR 
Number. Number the MIPR by using--
    (i) The requiring department identification code as prescribed in 
DoD

[[Page 569]]

4000.25-6-M, Department of Defense Activity Address Directory (DoDAAD);
    (ii) The last digit of the fiscal year; and
    (iii) The number of the particular MIPR (numbered consecutively by 
the requiring activity).
    (2) Block 6--Amend No. Assign a suffix number. Assign amendments of 
the same MIPR consecutive suffix numbers.
    (3) Block 9. (i) Conduct interdepartmental screening of items in 
accordance with FAR 8.001. Requisition items which are available from 
stocks of other departments as follows:
    (A) Obtain items within the scope of MILSTRIP (see DoD 4000.25-1-M, 
Military Standard Requisitioning and Issue Procedures (MILSTRIP)) by use 
of DD Form 1348 (Single Line Item Requisition System Document (Manual), 
DoD))/1348M (Single Line Item Requisition System Document, DoD 
(Mechanical)).
    (B) Obtain items not covered by MILSTRIP using DD Form 1149, 
Requisition and Invoice/Shipping Document.
    (C) If, after receipt of a MIPR, it is determined the requested 
items are available from stock, the acquiring department shall use the 
MIPR to obtain the item.
    (ii) Normally restrict a MIPR to one major end item, including its 
required spare parts, ground support equipment, and similar related 
items. For other than major end items, limit MIPRs to items within a 
single Federal supply class when possible.
    (4) Block 10--(i) Delivery Schedules. (A) The requiring department 
must clearly state the required time of delivery or performance in each 
MIPR, taking into consideration the normal administrative lead time of 
the particular commodity. Delivery and performance schedules on MIPRs 
must be realistic (see FAR 12.1). If the acquiring department cannot 
accept the delivery schedule in the MIPR, the acquiring department will 
note that on DD Form 448-2, Acceptance of MIPR. Changes in the requested 
delivery schedule must be made by MIPR amendment.
    (B) When a short delivery schedule is mandatory, the requiring 
department shall mark the MIPR ``URGENT'' in bold letters and provide 
justification for the marking.
    (ii) Requiring activities must provide MILSTRIP requisition data 
prescribed in appendix B of the MILSTRIP Manual for each line item which 
is to be delivered to each ``ship to'' address. Repetitive data 
applicable to all lines on the MIPR may be overprinted.
    (iii) The requiring activity will furnish estimated weight, cube, 
and dimensions for each line item or a statement explaining why these 
data are not available.
    (iv) The requiring activity shall include the name and telephone 
number of an individual who is thoroughly familiar with the MIPR, its 
attachments, and technical requirements.
    (v) Prepare attachments to MIPRs in sufficient numbers so that each 
copy of a MIPR submitted to the acquiring department is complete with a 
copy of all attachments. ``Ship To and Mark For'' addresses in shipping 
instructions must include the clear text identification and DoDAAD code 
if assigned.
    (5) Block 12--transportation allotment. Enter allotment data for 
transportation of supplies at Government expense if appropriate.
    (6) Block 13--mail invoices to. Use this block to identify the name 
and address of the office to receive invoices and make payment. (i) 
Complete the block only if--
    (A) The resulting contract is not to be paid by the Defense Contract 
Management Command or the Defense Finance Center; and
    (B) The office to receive invoices and make payment is known at the 
time of preparation of the MIPR.
    (ii) If payment is to be made by an office designated to receive 
invoices, also enter the DoDAAD code of that office.
    (iii) If payment is to be made by an office other than the office to 
which the invoice is to be mailed, include the name, address, and DoDAAD 
code of the payment office as an attachment to the MIPR.
    (iv) If multiple offices are to receive invoices and make payment, 
include the names and addresses of those offices as an attachment to the 
MIPR. Also include the DoDAAD code of each payment office.

[[Page 570]]

    (v) Whenever the payment office is included in an attachment, 
include a reference to the attachment in this block.
    (vi) If the names and addresses of invoicing and payment offices are 
provided the acquiring department after submission of the MIPR, the 
requiring department also must provide the DoDAAD code for each payment 
office.
    (7) Block 14. Enter allotment data for the acquisition of supplies. 
Enter each citation in Item 14 in the appropriate space as follows--
    (i) Accounting classification reference number (ACRN). If the ACRN 
procedures of 204.7108 are used in the MIPR to relate allotment data to 
the MIPR item or delivery, enter the ACRN for each fund citation. (The 
acquiring department, when preparing the contract, is not required to 
use the ACRN assigned to a fund citation in the MIPR.)
    (ii) Appropriation. Enter the ten positions as follows:
    (A) First and second--Treasury Department number identifying the 
department or agency to which the appropriation applies or has been 
transferred.
    (B) Third and fourth--Treasury Department number identifying the 
department or agency from which an appropriation has been transferred; 
leave blank if no transfer is involved.
    (C) Fifth and sixth--Identify the appropriation fiscal year. For 
multiple-year appropriations, the fifth position shall be the last digit 
of the first year of availability, and the sixth position shall be the 
last digit of the final year of availability. For annual appropriations, 
the fifth position shall be blank, and the sixth position shall be the 
last digit of the fiscal year. For no-year (continuing) appropriations, 
the fifth position shall be blank, and the sixth position shall be 
``X.''
    (D) Seventh through tenth--Treasury Department appropriation serial 
number.
    (iii) Limit/Subhead. Up to four characters; if less than four 
characters, leave empty spaces blank.
    (iv) Supplemental accounting classification data. Not to exceed 36 
characters. Enter in accordance with departmental or agency regulations.
    (v) Accounting station. Enter the six character DoDAAD code of the 
accounting station (not used with Navy and Marine Corps funds).
    (vi) Amount. Enter the amount for each fund citation if more than 
one allotment is cited.
    (vii) Additional citations. If space is required for additional fund 
citations, include as an attachment and reference the attachment on the 
form.
    (d) When preparing a MIPR amendment, always fill out the basic 
information in Blocks 1 through 8. Fill out only those other blocks 
which vary from the data shown on the basic MIPR or a prior amendment. 
Insert ``n/c'' in items where there is no change.
    (e) Change of a disbursing office cited on a DoD funded MIPR does 
not require a MIPR amendment when the resultant contract is assigned for 
administration to the Defense Contract Management Command. The 
administrative contracting office may issue an administrative change 
order, copies of which will be provided to the contracting officer for 
transmittal to the requiring activity.



253.208-2  DD Form 448-2, Acceptance of MIPR.

    (a) Use the DD Form 448-2 as prescribed in subpart 208.70.
    (b) Instructions for completion of DD Form 448-2. (Complete only the 
applicable blocks.) (1) Block 6. Check the specific terms under which 
the MIPR is being accepted.
    (2) Block 7. If any one of the MIPR line items is not accepted, 
check Block 7 and record the affected MIPR line item number and reason 
in Block 13.
    (3) Blocks 8 and 9. Use Blocks 8 and 9 only--
    (i) When Block 6c acceptance is indicated (indicate the MIPR line 
item numbers that will be provided under each method of financing in 
Blocks 8a and 9a, respectively); or
    (ii) If quantities or estimated costs cited in a MIPR require 
adjustment (list the affected MIPR line item numbers together with the 
adjusted quantities or estimated costs in the columns provided under 
Blocks 8 and 9, as appropriate).

[[Page 571]]

    (4) Block 10. Whenever a MIPR is accepted in part or in total under 
Category II funding, forecast the estimated date of contract award.
    (5) Block 11. Enter the total amount of funds required to fund the 
MIPR items, as accepted.
    (6) Block 12. (i) Complete this block only in those cases where the 
amount recorded in Block 11 is not in agreement with the amount recorded 
in Block 5. This will serve either--
    (A) As a request to the requiring department to issue a MIPR 
amendment to provide the additional funds; or
    (B) Authority for the requiring department to withdraw the available 
excess funds.
    (ii) When funds of two or more appropriations are involved, provide 
proper breakdown information in Block 13.
    (7) Block 13. Use this block to record--
    (i) Justification, by MIPR line item, for any additional funds 
required;
    (ii) Explanation for rejection of MIPR whether in part or in total;
    (iii) Appropriation and subhead data cited on the MIPR; and
    (iv) Other pertinent data.
    (c) Complete a DD Form 448-2 for all MIPR amendments involving an 
adjustment of funds or delivery schedule, or if requested by the 
requiring department.
    (d) Unless otherwise agreed, provide the requiring department an 
original and three copies of each DD Form 448-2.



253.209  Contractor qualifications.



253.209-1  Responsible prospective contractors.

    (a) SF 1403, Preaward Survey of Prospective Contractor (General). 
(i) The factors in Section III, Block 19, generally mean--
    (A) Technical capability. An assessment of the prospective 
contractor's key management personnel to determine if they have the 
basic technical knowledge, experience, and understanding of the 
requirements necessary to produce the required product or provide the 
required service.
    (B) Production capability. An evaluation of the prospective 
contractor's ability to plan, control, and integrate manpower, 
facilities, and other resources necessary for successful contract 
completion. This includes--
    (1) An assessment of the prospective contractor's possession of, or 
the ability to acquire, the necessary facilities, material, equipment, 
and labor; and
    (2) A determination that the prospective contractor's system 
provides for timely placement of orders and for vendor follow-up and 
control.
    (C) Quality assurance capability. An assessment of the prospective 
contractor's capability to meet the quality assurance requirements of 
the proposed contract. It may involve an evaluation of the prospective 
contractor's quality assurance system, personnel, facilities, and 
equipment.
    (D) Financial capability. A determination that the prospective 
contractor has or can get adequate financial resources to obtain needed 
facilities, equipment, materials, etc.
    (E) Accounting system and related internal controls. An assessment 
by the auditor of the adequacy of the prospective contractor's 
accounting system and related internal controls as defined in 242.7501, 
Definition. Normally, a contracting officer will request an accounting 
system review when soliciting and awarding cost-reimbursement or 
incentive type contracts, or contracts which provide for progress 
payments based on costs or on a percentage or stage of completion.
    (ii) The factors in section III, Block 20, generally mean--
    (A) Government property control. An assessment of the prospective 
contractor's capability to manage and control Government property.
    (B) Transportation. An assessment of the prospective contractor's 
capability to follow the laws and regulations applicable to the movement 
of Government material, or overweight, oversized, hazardous cargo, etc.
    (C) Packaging. An assessment of the prospective contractor's ability 
to meet all contractual packaging requirements including preservation, 
unit pack, packing, marking, and unitizing for shipment.
    (D) Security clearance. A determination that the prospective 
contractor's facility security clearance is adequate and current. (When 
checked, the surveying activity will refer this factor to

[[Page 572]]

the Defense Investigative Service (DIS)).
    (E) Plant safety. An assessment of the prospective contractor's 
ability to meet the safety requirements in the solicitation.
    (F) Environmental/energy consideration. An evaluation of the 
prospective contractor's ability to meet specific environmental and 
energy requirements in the solicitation.
    (G) Flight operations and flight safety. An evaluation of the 
prospective contractor's ability to meet flight operation and flight 
safety requirements on solicitations involving the overhaul and repair 
of aircraft.
    (H) Other. If the contracting officer wants an assessment of other 
than major factors A-E and other factors A-G, check this factor. Explain 
the desired information in the Remarks sections.
[56 FR 36554, July 31, 1991, as amended at 60 FR 29504, June 5, 1995]



253.213  Small purchase and other simplified purchase procedures (SF's 18, 30, 44, 1165, OF's 347, 348).

    (e) OF 347 (10/83), Order for Supplies or Services, and OF 348 (10/
83), Order for Supplies or Services-Schedule Continuation. DoD uses the 
DD Form 1155, Order for Supplies or Services, instead of OF 347. DoD 
uses Optional Form 336, Continuation Sheet, instead of OF 348.
    (i) Use the DD Form 1155 as prescribed in 213.505-2(b) and in 
accordance with the instructions at 253.213-70.
    (ii) Use the OF 336, or a sheet of paper, as a continuation sheet 
for the DD Form 1155. Continuation sheets may be printed on the reverse 
of the DD Form 1155.
    (iii) DD Form 1155c-1, Order for Supplies or Services (Commissary 
Continuation Sheet) may be used for commissary acquisitions.



253.213-70  Instructions for completion of DD Form 1155.

    (a) These instructions are mandatory if--
    (1) Contract administration has been assigned outside the purchasing 
office; or
    (2) The contractor is located in the continental United States or 
Canada.
    (b) The entity codes (address codes) referenced in this subsection 
are codes published in--
    (1) DoD Activity Address Directory (DODAAD), DoD 4000.25-6-M.
    (2) Military Assistance Program Address Directory System (MAPAD), 
DoD 4000.25-8-M.
    (3) Commercial and Government Entity (CAGE) Codes Handbook H4/H8.
    (c) For orders requiring payment in Canadian currency--
    (1) State the contract price in terms of Canadian dollars, followed 
by the initials CN; e.g., $1,647.23CN.
    (2) Indicate on the face of the order--
    (i) The U.S./Canadian conversion rate in effect at the time of the 
award; and
    (ii) The U.S. dollar equivalent of the Canadian dollar amount.
    (d) When the DD Form 1155 includes FMS requirements, clearly mark 
FMS requirement on its face. Specify within the order each FMS case 
identifier code by line or subline item number.
    (e) Instructions for DD Form 1155 entries. (Instructions apply to 
both purchase orders and delivery orders, except Block 2, which applies 
only to delivery orders, and Block 12, which applies only to purchase 
orders.)

                                  Block

                      1  Contract/Purch Order No.--

    Enter the Procurement Instrument Identification (PII) number and, 
when applicable, the supplementary identification number for contracts 
and purchase orders as prescribed in subpart 204.70.

                         2  Delivery Order No.--

    Enter PII number for delivery orders, when applicable, as prescribed 
in subpart 204.70.

                           3  Date of Order--

    Enter the two position numeric year, three position alpha month, and 
two position numeric day.

                   4  Requisition/Purch Request No.--

    Enter the number authorizing the purchase. When the number differs 
by line item, list it in the schedule and annotate this block, ``see 
schedule.''

                              5  Priority--

    Enter the appropriate Program Identification Code as identified in 
Schedule I to the Defense Priorities and Allocations System Regulation.

[[Page 573]]

                             6  Issued by--

    Enter the name and address of the issuing office. In the code block, 
enter the DODAAD code for the issuing office. Directly below the 
address, enter: Buyer/Symbol: followed by the buyer's name and routing 
symbol. Directly below the buyer/symbol, enter: Phone: followed by the 
buyer's phone number and extension.

                          7  Administered by--

    Enter the name and address of the contract administration activity. 
On purchase orders retained by purchasing offices for administration, 
mark this block, ``see block 6.'' Enter in the code block the DODAAD 
code of the contract administration activity. In the lower right or 
left-hand corner, enter the criticality designator code from FAR 
42.1105.

                            8  Delivery FOB--

    Check the applicable box.

                             9  Contractor--

    (i) Enter the full business name and address of the contractor. 
Enter in the first code block, the CAGE code of the contractor.
    (ii) If it is known that all the work covered by the order is to be 
performed at an address different from the address represented by the 
contractor's code, and any contract administration function will be 
required at that facility, enter in the facility code block the 
organizational entity code for that facility, i.e., H8-1/H8-2 code for a 
non-Government entity or DODAAD code for a Government entity. (Use 
DODAAD codes only to indicate ``performed at'' locations for orders 
specifying services at a Government location.) If it is known that 
multiple facilities are involved, enter the codes for all facilities at 
which work is to be performed, including the contractor's code if work 
is performed at that address, in the Optional Form 336 Continuation 
Sheet and mark the facility code block with ``see schedule.''

                  10  Deliver to FOB Point by (Date)--

    If a single date of delivery applies to the entire order, enter date 
in this block. List multiple delivery dates in the schedule and mark 
this block ``see schedule.''

                         11  Mark if Business--

    Check all applicable blocks.

                          12  Discount Terms--

    Enter the discount for prompt payment in terms of percentages and 
corresponding days. Express the percentages in whole numbers and 
decimals, e.g., 3.25%--10 days; 0.50%--20 days.

                         13  Mail Invoices to--

    Enter a reference to the block number containing the address to 
which invoices are to be mailed. When not in Blocks 6, 7, 14, or 15, 
insert in Block 13, ``see schedule.''

                              14  Ship to--

    If a single ship-to point applies to the entire order, enter the 
name and address of that point in this block and a DODAAD code in the 
code block. For FMS shipments, enter the MAPAD code in the code block 
and an instruction for the contractor to contact the transportation 
office of the administering activity to obtain a name and shipping 
address. Enter multiple ship-to points in the schedule and mark this 
block, ``See Schedule.''

                      15  Payment Will be Made by--

    Enter the name and address of the activity making payment. Enter in 
the code block, the DODAAD code of the paying activity.

                           16  Type of Order--

    Check the appropriate box. If a purchase order:
    (i) Identify the type of quotation, i.e., oral, letter or TWX, on 
which the order is based.
    (ii) Check the box when acceptance of the purchase order is required 
and enter the number of copies of the order to be returned to the 
issuing office.

            17  Accounting and Appropriation Data/Local Use--

    Enter the accounting classification and the accounting 
classification reference number(s) in accordance with 204.7108.

                                  Block

                             18  Item No.--

    Enter an item number for each item of supply or service in 
accordance with subpart 204.71.

                   19  Schedule of Supplies/Services--

    The schedule contains several elements of data. The order and 
arrangement of data in the schedule is mandatory for purchase and 
delivery orders assigned to DCMC or the military departments for 
administration and is encouraged for all orders.
    (1) National Stock Number (NSN)--
    Total item quantity for the line or subline item number followed by 
the appropriate national stock number or the word ``none'' if an NSN has 
not been assigned. On the same line and adjacent to NSN, enter the words 
``Total Item Quantity.'' This phrase is used in conjunction with the 
total quantity, unit of issue, unit price, and dollar amount of the 
stock number or item cited (see entries for Blocks 20, 21, 22, and 23).

[[Page 574]]

    (2) Item Identification--
    Enter first the most descriptive noun or verb of the supplies or 
services to be furnished, supplemented by additional description as 
prescribed in FAR part 10. If multiple accounting classifications apply 
to the contract, enter the accounting classification reference number.
    (3) Quantity Variance--
    Enter the quantity variance permitted for the line item in terms of 
percentages, indicating whether the percentage is plus or minus and if 
applicable to each destination.
    (4) Inspection/Acceptance--
    Enter the point at which inspection/acceptance will take place.
    (5) Preservation and Packaging--
    Enter the preservation requirements for the item described. These 
requirements may be expressed in terms of MIL-STD-2073-1, DoD Material 
Procedures for Development and Application of Packaging Requirements, 
and MIL-STD-2073-2, Packaging Requirements, codes. They may also be 
expressed by reference to applicable specifications.
    (6) Packing--
    When required, enter the packing level designator and specification, 
standard, or document in which the requirements are stated or state the 
specific requirements.
    (7) Unitization--
    When desired by the requiring activity, a requirement for cargo 
unitization for a particular destination should be specified for 
shipments involving two or more shipping containers having an aggregate 
total of not less than 20 cubic feet or 200 pounds.
    (8) Ship To--
    Enter the DODAAD or MILSCAP H8-1/H8-2 (cage) as appropriate for the 
entity code of the ship-to point on the first line and the corresponding 
name and address on succeeding lines. If multiple accounting 
classifications apply to the same line or subline item, enter the 
accounting classification reference number. When several items are to be 
shipped to the same point, the code will be listed; but it will not be 
necessary to repeat the address.
    (9) Delivery Date--
    When multiple delivery dates apply, enter the required date of 
delivery on the same line with ship-to code.
    (10) Mark For--
    Enter the DODAAD or MILSCAP H8-1/H8-2 (cage) as appropriate for the 
entity code on the first line and name and address of the ultimate 
recipient of the supplies and services on succeeding lines.

                     20  Quantity Ordered/Accepted--

    Enter the total quantity ordered for the line item. If applicable, 
enter the breakdown on quantities for each ship-to point within the line 
item.

                               21  Unit--

    Enter the unit of measure applicable to the line item.

                            22  Unit Price--

    Enter the unit price applicable to the line item.

                              23  Amount--

    Enter the extended dollar amount (quantity x unit price) for each 
line item.

                   24  Contracting/Ordering Officer--

    Enter the contracting/ordering officer's signature.

                           25  Total Amount--

    Enter the total dollar amount for all line items on the order.

     26 thru 42  These blocks are used in the receiving and payment 
     functions. Procedures for making entries are prescribed by the 
                         respective departments.

[56 FR 36554, July 31, 1991, as amended at 61 FR 7751, Feb. 29, 1996]



253.215  Contracting by negotiation.



253.215-70  DD Form 1547, Record of Weighted Guidelines Application.

    (a) Use the DD Form 1547 as prescribed in 215.970.
    (b) General instructions. (1) Report amounts as they relate to the 
price of the contract action without regard to funding status (e.g., 
amounts obligated).
    (2) Express all dollar values to the nearest whole value (e.g., 
$200,008.55=$200,009).
    (3) Express all percentages to the nearest hundredth or thousandth 
as appropriate (e.g., interest rate--8.25% or 8.257%).
    (4) If the contracting office is exempt from reporting to the DoD 
management information system on profit and fee statistics (see 
215.975), do not complete Blocks 1, 4, 5, 6, 7, 8, 9, 10, 11, or 12.
    (5) Report an option amount for additional quantities as a separate 
contract action when exercised.
    (6) Even though fixed-price type contract actions are negotiated on 
the basis of total price, prepare the negotiation summary portion of the 
DD Form 1547 showing the contracting officer's best estimates of cost 
and profit.

[[Page 575]]

    (7) Ensure compliance with 215.871-5.
    (8) For indefinite delivery-type contracts, prepare a consolidated 
DD Form 1547 for annual requirements expected to exceed $500,000.
    (9) Prepare a consolidated DD Form 1547, if possible, when multiple 
profit rates apply to a single negotiation.
    (c) Specific instructions for completion of DD Form 1547--(1) Block 
1--report no. Enter the four-digit local control number followed by a 
dash and the last two digits of the fiscal year (e.g., 0004-90 for 4th 
action in fiscal year 1990). Each field contracting office participating 
in profit reporting shall establish a control system for consecutively 
numbering completed DD Forms 1547. Always start with 0001 at the 
beginning of each fiscal year and always use four digits. This number 
will identify the specific DD Form 1547 in DoD's management information 
system and will be used for follow-up actions.
    (2) Block 2--basic procurement instrument identification no. Enter 
the identifying contract number assigned per 204.70 (Block B1A of the DD 
350).
    (3) Block 3--SPIIN. Enter the supplemental procurement instrument 
identification number for supplemental agreements or other 
modifications, assigned per 204.70, (Block B2 of the DD 350).
    (4) Block 4--date of action--(i) Year. Enter the last two digits of 
the year the action was negotiated (e.g., 90 for 1990).
    (ii) Month. Enter the two digit number for the month the action was 
negotiated (e.g., 09 for September).
    (5) Block 5--contracting office code. Enter the code assigned the 
contracting office per DoD Procurement Coding Manual, Volume III, (Block 
A3 of the DD 350).
    (6) Block 6--name of contractor. Enter the contractor's name 
(including division name), (Block B5D of the DD 350).
    (7) Block 7--DUNS number. Enter the contractor establishment code 
number, (Block B5A of the DD 350).
    (8) Block 8--federal supply code. Enter the code used in Block B12A 
of the DD 350.
    (9) Block 9--DOD claimant program. Enter the code used in Block B12B 
of the DD 350.
    (10) Block 10--contract type code. Enter the appropriate code--

                                                                        
------------------------------------------------------------------------
                  Description                             Code          
------------------------------------------------------------------------
FPR (all types)...............................  A                       
FPI (all types)...............................  L                       
FFP...........................................  J                       
FP(E).........................................  K                       
CPFF..........................................  U                       
CPIF (all types)..............................  V                       
------------------------------------------------------------------------

    (11) Block 11--type effort. Enter the appropriate code--

                                                                        
------------------------------------------------------------------------
                           Description                             Code 
------------------------------------------------------------------------
Manufacturing...................................................       1
Research and Development........................................       2
Services........................................................       3
------------------------------------------------------------------------

    (12) Block 12--use code. Enter the appropriate code for use of the 
weighted guidelines method--

                                                                        
------------------------------------------------------------------------
                           Description                             Code 
------------------------------------------------------------------------
Standard weighted guidelines method (215.971)...................       2
  Alternate performance risk, no facilities employed (215.971-          
   2(c)(2)).....................................................       1
  Alternate facilities capital employed (215.971-4(c)(2)).......       3
Alternate structured approach (215.973).........................       4
Modified weighted guidelines approach (215.972).................       5
------------------------------------------------------------------------

    (13) Blocks 13 through 20--cost category objective. Enter the 
prenegotiation objectives. Include contractor independent research and 
development/bid and proposal in the general and administrative expenses 
in Block 19.
    (14) Blocks 21 through 29--weighted guidelines profit factors. Enter 
the amounts determined in 215.971 or 215.972. This section is not 
required to be completed when using an alternate structured approach 
(215.973).
    (15) Block 30--total profit objective. Enter the total of Blocks 24, 
25, 26, 28, and 29. This section is not required to be completed when 
using an alternate structured approach (215.973).
    (16) Blocks 31 through 35--negotiation summary. Complete as 
indicated on the form. For fixed-price type contracts negotiated on a 
total price basis, enter the contracting officer's best estimates of 
cost and profit. When using an alternate structured approach, see 
215.973(b)(2) for offsets.
    (17) Blocks 36 through 39--contracting officer approval. The 
contracting officer shall sign the form. Include a complete (with area 
code) commercial telephone

[[Page 576]]

number to facilitate any follow-up actions.
    (18) Blocks 96 through 99--optional use. Complete in accordance with 
department/agency procedures, if any.

    Note: Department of Defense Acquisition Forms are not published in 
the Federal Register or the Code of Federal Regulations. For the 
convenience of the user, the list set forth below includes section 
numbers, form numbers, and titles.

253.303-250  Material Inspection and Receiving Report.
253.303-250c  Material Inspection and Receiving Report-Continuation 
          Sheet.
253.303-250-1  Tanker/Barge Material Inspection and Receiving Report.
253.303-350  Individual Contracting Action Report.
253.303-375  Production Progress Report.
253.303-375c  Production Progress Report (Continuation).
253.303-375-2  Delay in Delivery.
253.303-416  Purchase Request for Coal, Coke or Briquettes.
253.303-428  Communication Service Authorization.
253.303-448  Military Interdepartmental Purchase Request.
253.303-448-2  Acceptance of MIPR.
253.303-879  Statement of Compliance.
253.303-882  Report of Inventions and Subcontracts.
253.303-1057  Monthly Contracting Summary of Actions $25,000 or Less.
253.303-1114  Instructions for Use of Contract Termination Settlement 
          and Inventory Schedule Forms.
253.303-1131  Cash Collection Voucher.
253.303-1149  Requisition and Invoice/Shipping Document.
253.303-1155  Order for Supplies or Services.
253.303-1155c-1  Order for Supplies or Services (Commissary Continuation 
          Sheet).
253.303-1342  Property Record.
253.303-1348  Single Line Item Requisition System Document (Manual).
253.303-1348m  Single Line Item Requisition System Document 
          (Mechanical).
253.303-1348-1  Single Line Item Release/Receipt Document.
253.303-1384  Transportation Control and Movement Document.
253.303-1391  FY 19____ Military Construction Project Data.
253.303-1419  Industrial Plant Equipment Requisition.
253.303-1423  Contract Data Requirements List.
253.303-1423-1  Contract Data Requirements List (1 Data Item).
253.303-1423-2  Contract Data Requirements List (2 Data Items).
243.303-1425  Specifications and Standards Requisition.
253.303-1484  Post-Award Conference Record.
253.303-1507  Work Stoppage Report.
253.303-1513  United States Department of Defense Offer and Acceptance.
253.303-1535  Request/Approval for Authority to Advertise.
253.303-1547  Record of Weighted Guidelines Application.
253.303-1568  Labor Standards Investigation Summary Sheet.
253.303-1592  Contract Cross Reference Data.
253.303-1593  Contract Administration Completion Record.
253.303-1594  Contract Completion Statement.
253.303-1597  Contract Closeout Check-List.
253.303-1598  Contract Termination Status Report.
253.303-1635  Plant Clearance Case Register.
253.303-1637  Notice of Acceptance of Inventory Schedules.
253.303-1638  Report of Disposition of Contractor Inventory.
253.303-1639  Scrap Warranty.
253.303-1640  Request for Plant Clearance.
253.303-1641  Disposal Determination Approval.
253.303-1651  Industrial Equipment Modernization Program Post Analysis 
          Report.
253.303-1653  Transportation Data for Solicitations.
253.303-1654  Evaluation of Transportation Cost Factors.
253.303-1659  Application for U.S. Government Shipping Documentation/
          Instructions.
253.303-1662  Property in the Custody of Contractors.
253.303-1664  Data Item Description.
253.303-1707  Information to Offerors or Quoters.
253.303-1861  Contract Facilities Capital Cost of Money.
253.303-1921  Cost Data Summary Report.
253.303-1921-1  Functional Cost-Hour Report.
253.303-2025  Packaging Change Recommendation/Approval.
253.303-2051  Request for Assignment of a Commercial and Government 
          Entity (CAGE) Code.
253.303-2051-1  Request for Information/Verification of Commercial and 
          Government Entity (CAGE) Code.
253.303-2139  Report of Contract Performance Outside the United States.
253.303-2222  Short Form Research Contract (SFRC) Modification.
253.303-2222-1  Representations and Certifications from Offerors 
          Submitting Proposals Under DFARS 35.70.
253.303-2222-2  Short Form Research Contract Research Proposal Cover 
          Page.
253.303-2579  Small Business Coordination Record.
253.303-2626  Performance Evaluation (Construction).

[[Page 577]]

253.303-2631  Performance Evaluation (Architect-Engineer).
[56 FR 36554, July 31, 1991, as amended at 59 FR 27677, 27678, May 27, 
1994; 60 FR 29504, June 5, 1995; 61 FR 7751, Feb. 29, 1996; 61 FR 18195, 
Apr. 24, 1996; 61 FR 51043, Sept. 30, 1996; 62 FR 34136, June 24, 1997]

[[Page 578]]



             SUBCHAPTER I--AGENCY SUPPLEMENTARY REGULATIONS



          Appendix A--Armed Services Board of Contract Appeals

Sec.

Part 1--Charter
Part 2--Rules

    Authority; 41 U.S.C. 421 and 48 CFR chapter 1.

                Armed Services Board of Contract Appeals

Approved 1 May 1962.
Revised 1 May 1969.
Revised 1 September 1973.
Revised 1 July 1979.

                             Part 1--Charter

    1. There is created the Armed Services Board of Contract Appeals 
which is hereby designated as the authorized representative of the 
Secretary of Defense, the Secretary of the Army, the Secretary of the 
Navy and the Secretary of the Air Force, in hearing, considering and 
determining appeals by contractors from decisions of contracting 
officers or their authorized representatives or other authorities on 
disputed questions. These appeals may be taken (a) pursuant to the 
Contract Disputes Act of 1978 (41 U.S.C. Sec. 601, et seq.), (b) 
pursuant to the provisions of contracts requiring the decision by the 
Secretary of Defense or by a Secretary of a Military Department or their 
duly authorized representative or board, or (c) pursuant to the 
provisions of any directive whereby the Secretary of Defense or the 
Secretary of a Military Department has granted a right of appeal not 
contained in the contract on any matter consistent with the contract 
appeals procedure. The Board may determine contract disputes for other 
departments and agencies by agreement. The Board shall operate under 
general policies established or approved by the Under Secretary of 
Defense (Research and Engineering).
    2. Membership of the Board shall consist of attorneys at law who 
have been qualified in the manner prescribed by the Contract Disputes 
Act of 1978. Members of the Board are hereby designated Administrative 
Judges. There shall be appointed from members of the Board a chairman 
and two or more vice-chairmen. Appointment of the chairman and vice-
chairmen and other members of the Board shall be made by the Under 
Secretary of Defense (Research and Engineering) and the Assistant 
Secretaries of the Military Departments responsible for procurement. The 
chairman and vice-chairmen shall serve in that capacity for a two-year 
term unless sooner removed or reappointed for an additional term or 
terms. The Under Secretary will also designate the order in which the 
vice-chairmen will act for the chairman in his absence. In the absence 
of a vice-chairman, the chairman or acting chairman may designate a 
member of the Board to serve as a temporary vice-chairman.
    3. It shall be the duty and obligation of the members of the Armed 
Services Board of Contract Appeals to decide appeals on the record of 
the appeal to the best of their knowledge and ability in accordance with 
applicable contract provisions and in accordance with law and regulation 
pertinent thereto.
    4. The chairman of the Board shall be responsible for establishing 
appropriate divisions of the Board to provide for the most effective and 
expeditous handling of appeals. He shall be reponsible for assigning 
appeals to the divisions for decision without regard to the military 
department or other procuring agency which entered into the contract. A 
division may consist of one or more members of the Board. The chairman 
shall designate one member of each division as the division head. The 
division heads and the chairman and vice-chairmen shall constitute the 
senior deciding group of the Board. A majority of the members of a 
division or of the senior deciding group shall constitute a quorum for 
the transaction of the business of each, respectively. Decisions of the 
Board shall be by majority vote of the members of a division 
participating and the chairman and a vice-chairman, unless the chairman 
refers the appeal for decision by the senior deciding group. The 
decision of the Board in cases so referred to the senior deciding group 
shall be by majority vote of the participating members of that group. 
The chairman may refer an appeal of unusual difficulty, significant 
precedential importance, or serious dispute within the normal decision 
process for decision by the senior deciding group. An appeal involving 
$50,000 or less may be decided by a single member or fewer members of 
the Board than hereinbefore provided for cases of unlimited dollar 
amount, under accelerated or expedited procedures as provided in the 
Rules of the Board and the Contract Disputes Act of 1978.
    5. The Board shall have all powers necessary and incident to the 
proper performance of its duties. Subject to the approval of the Under 
Secretary of Defense (Research and Engineering) and the Assistant 
Secretaries of the Military Departments responsible for procurement, the 
Board shall adopt its own methods of procedure, and rules and 
regulations for its conduct and for the preparation and presentation of 
appeals and issuance of opinions. The Military Departments and other 
procuring agencies shall provide

[[Page 579]]

legal personnel to prepare and present the contentions of the 
departments or agencies in relation to appeals filed with the Board. It 
shall not be necessary for the Board, unless it otherwise desires, to 
communicate with more than one trial attorney in each of the departments 
or agencies concerning the preparation and presentation of appeals and 
the obtaining of all records deemed by the Board to be pertinent 
thereto.
    6. Any member of the Board or any examiner, designated by the 
chairman, shall be authorized to hold hearings, examine witnesses, and 
receive evidence and argument for consideration and determination of the 
appeal by the designated division. A member of the Board shall have 
authority to administer oaths and issue subpoenas as specified in 
section 11 of the Contract Disputes Act of 1978. The chairman may 
request orders of the court in cases of contumacy or refusal to obey a 
subpoena in the manner prescribed in that section.
    7. The chairman shall be responsible for the internal organization 
of the Board and for its administration. He shall provide within 
approved ceilings for the staffing of the Board with non-member 
personnel, including hearing examiners, as may be required for the 
performance of the functions of the Board. The chairman shall appoint a 
recorder of the Board. Such personnel shall be responsible to and shall 
function under the direction, supervision and control of the chairman.
    8. The Board will be serviced by the Department of the Army for 
administrative support for its operations as required. Administrative 
support will include budgeting, funding, fiscal control, manpower 
control and utilization, personnel administration, security 
administration, supplies, and other administrative services. The 
Departments of the Army, Navy, Air Force and the Office of the Secretary 
of Defense will participate in financing the Board's operations on an 
equal basis and to the extent determined by the Assistant Secretary of 
Defense (Comptroller). The cost of processing appeals for departments 
and agencies other than those in the Department of Defense will be 
reimbursed.
    9. The chairman of the Board will furnish the Secretary of Defense 
and to the Secretaries of the Military Departments by October 31 of each 
year a report containing an account of the Board's transactions and 
proceedings for the preceding fiscal year. Within 30 days following the 
close of a calendar quarter, the chairman shall forward a report of the 
Board's proceedings for the quarter to the Under Secretary of Defense 
(Research and Engineering), the Assistant Secretaries of the Military 
Departments responsible for procurement, and to the Director of the 
Defense Logistics Agency. Such reports shall disclose the number of 
appeals received, cases heard, opinions rendered, current reserve of 
pending matters, and such other information as may be required.
    10. The Board shall have a seal bearing the following inscription: 
``Armed Services Board of Contract Appeals.'' This seal shall be affixed 
to all authentications of copies of records and to such other 
instruments as the Board may determine.
    11. This revised charter is effective April 21, 1980.

    Approved:

W. Graham Claytor, Jr.
Deputy Secretary of Defense
Clifford L. Alexander, Jr.
Secretary of the Army
E. Hidalgo
Secretary of the Navy
Hans M. Mark
Secretary of the Air Force

                              Part 2--Rules

Approved 15 July 1963.
Revised 1 May 1969.
Revised 1 September 1973.
Revised 30 June 1980.

                                 Preface

                 I. Jurisdiction for Considering Appeals

    The Armed Services Board of Contract Appeals (referred to herein as 
the Board) shall consider and determine appeals from decisions of 
contracting officers pursuant to the Contract Disputes Act of 1978 Pub. 
L. 95-563, 41 U.S.C. 601-613) relating to contracts made by (i) the 
Departments of Defense, Army, Navy and Air Force or (ii) any other 
executive agency when such agency or the Administrator for Federal 
Procurement Policy has designated the Board to decide the appeal.

               II. Location and Organization of the Board

    (a) The Board's address is Skyline Six, 5109 Leesburg Pike, 7th 
Floor, Falls Church, VA 22041, telephone (202) 756-8500 (receptionist), 
756-8502 (recorder).
    (b) The Board consists of a chairman, two or more vice chairmen, and 
other members, all of whom are attorneys at law duly licensed by a 
state, commonwealth, territory, or the District of Columbia. Board 
members are designated Administrative Judges.
    (c) There are a number of divisions of the Armed Services Board of 
Contract Appeals, established by the Chairman of the Board in such 
manner as to provide for the most effective and expeditious handling of 
appeals. The Chairman and a Vice Chairman of the Board act as members of 
each division. Appeals are assigned to the divisions for decision 
without regard to the military department or other procuring agency 
which entered into the contract involved. Hearing may be held by a 
designated member (Administrative Judge), or by a duly authorized 
examiner. Except for

[[Page 580]]

appeals processed under the expedited or accelerated procedure, the 
decision of a majority of a division constitutes the decision of the 
Board, unless the chairman refers the appeal to the Board's Senior 
Deciding Group (consisting of the chairman, vice chairmen and all 
division heads), in which event a decision of a majority of that group 
constitutes the decision of the Board. Appeals referred to the Senior 
Deciding Group are those of unusual difficulty, significant precedential 
importance, or serious dispute within the normal division decision 
process. For decisions of appeals processed under the expedited or 
accelerated procedure, see rules 12.2(c) and 12.3(b).

                         Preliminary Procedures

    1. Appeals, How Taken. (a) Notice of an appeal shall be in writing 
and mailed or otherwise furnished to the Board within 90 days from the 
date of receipt of a contracting officer's decision. A copy thereof 
shall be furnished to the contracting officer from whose decision the 
appeal is taken.
    (b) Where the contractor has submitted a claim of $50,000 or less to 
the contracting officer and has requested a written decision within 60 
days from receipt of the request, and the contracting officer has not 
done so, the contractor may file a notice of appeal as provided in 
subparagraph (a) above, citing the failure of the contracting officer to 
issue a decision.
    (c) Where the contractor has submitted a properly certified claim 
over $50,000 to the contracting officer or has requested a decision by 
the contracting officer which presently involves no monetary amount 
pursuant to the Disputes clause, and the contracting officer has failed 
to issue a decision within a reasonable time, taking into account such 
factors as the size and complexity of the claim, the contractor may file 
a notice of appeal as provided in subparagraph (a) above, citing the 
failure of the contracting officer to issue a decision.
    (d) Upon docketing of appeals filed pursuant to (b) or (c) hereof, 
the Board may, at its option, stay further proceedings pending issuance 
of a final decision by the contracting officer within such period of 
time as is determined by the Board.
    (e) In lieu of filing a notice of appeal under (b) or (c) hereof, 
the contractor may request the Board to direct the contracting officer 
to issue a decision in a specified period of time, as determined by the 
Board, in the event of undue delay on the part of the contracting 
officer.
    2. Notice of Appeal, Contents of. A notice of appeal should indicate 
that an appeal is being taken and should identify the contract (by 
number), the department and/or agency involved in the dispute, the 
decision from which the appeal is taken, and the amount in dispute, if 
known. The notice of appeal should be signed personally by the appellant 
(the contractor taking the appeal), or by the appellant's duly 
authorized representative or attorney. The complaint referred to in rule 
6 may be filed with the notice of appeal, or the appellant may designate 
the notice of appeal as a complaint, if it otherwise fulfills the 
requirements of a complaint.
    3. Docketing of Appeals. When a notice of appeal in any form has 
been received by the Board, it shall be docketed promptly. Notice in 
writing shall be given to the appellant with a copy of these rules, and 
to the contracting officer.
    4. Preparation, Content, Organization, Forwarding, and Status of 
Appeal File-- (a) Duties of Contracting Officer-- Within 30 days of 
receipt of an appeal, or notice that an appeal has been filed, the 
contracting officer shall assemble and transmit to the Board an appeal 
file consisting of all documents pertinent to the appeal, including:
    (1) The decision from which the appeal is taken;
    (2) The contract, including pertinent specifications, amendments, 
plans and drawings;
    (3) All correspondence between the parties relevant to the appeal, 
including the letter or letters of claim in response to which the 
decision was issued;
    (4) Transcripts of any testimony taken during the course of 
proceedings, and affidavits or statements of any witnesses on the matter 
in dispute made prior to the filing of the notice of appeal with the 
Board; and
    (5) Any additional information considered relevant to the appeal.
    Within the same time above specified the contracting officer shall 
furnish the appellant a copy of each document he transmits to the Board, 
except those in subparagraph (a)(2) above. As to the latter, a list 
furnished appellant indicating specific contractual documents 
transmitted will suffice.
    (b) Duties of the Appellant-- Within 30 days after receipt of a copy 
of the appeal file assembled by the contracting officer, the appellant 
shall transmit to the Board any documents not contained therein which he 
considers relevant to the appeal, and furnish two copies of such 
documents to the government trial attorney.
    (c) Organization of Appeal File-- Documents in the appeal file may 
be originals or legible facsimiles or authenticated copies, and shall be 
arranged in chronological order where practicable, numbered 
sequentially, tabbed, and indexed to identify the contents of the file.
    (d) Lengthy Documents-- Upon request by either party, the Board may 
waive the requirement to furnish to the other party copies of bulky, 
lengthy, or out-of-size documents in the appeal file when inclusion 
would be burdensome. At the time a party files with the Board a document 
as to which

[[Page 581]]

such a waiver has been granted he shall notify the other party that the 
document or a copy is available for inspection at the offices of the 
Board or of the party filing same.
    (e) Status of Documents in Appeal File-- Documents contained in the 
appeal file are considered, without further action by the parties, as 
part of the record upon which the Board will render its decision. 
However, a party may object, for reasons stated, to consideration of a 
particular document or documents reasonably in advance of hearing or, if 
there is no hearing, of settling the record. If such objection is made, 
the Board shall remove the document or documents from the appeal file 
and permit the party offering the document to move its admission as 
evidence in accordance with rules 13 and 20.
    (f) Notwithstanding the foregoing, the filing of the rule 4 (a) and 
(b) documents may be dispensed with by the Board either upon request of 
the appellant in his notice of appeal or thereafter upon stipulation of 
the parties.
    5. Motions. (a) Any motion addressed to the jurisdiction of the 
Board shall be promptly filed. Hearing on the motion shall be afforded 
on application of either party. However, the Board may defer its 
decision on the motion pending hearing on both the merits and the 
motion. The Board shall have the right at any time and on its own 
initiative to raise the issue of its jurisdiction to proceed with a 
particular case, and shall do so by an appropriate order, affording the 
parties an opportunity to be heard thereon.
    (b) The Board may entertain and rule upon other appropriate motions.
    6. Pleadings--(a) Appellant-- Within 30 days after receipt of notice 
of docketing of the appeal, the appellant shall file with the Board an 
original and two copies of a complaint setting forth simple, concise and 
direct statements of each of its claims. Appellant shall also set forth 
the basis, with appropriate reference to contract provisions, of each 
claim and the dollar amount claimed, to the extent known. This pleading 
shall fulfill the generally recognized requirements of a complaint, 
although no particular form is required. Upon receipt of the complaint, 
the Board shall serve a copy of it upon the Government. Should the 
complaint not be received within 30 days, appellant's claim and appeal 
may, if in the opinion of the Board the issues before the Board are 
sufficiently defined, be deemed to set forth its complaint and the 
Government shall be so notified.
    (b) Government-- Within 30 days from receipt of the complaint, or 
the aforesaid notice from the Board, the Government shall prepare and 
file with the Board an original and two copies of an answer thereto. The 
answer shall set forth simple, concise and direct statements of 
Government's defenses to each claim asserted by appellant, including any 
affirmative defenses available. Upon receipt of the answer, the Board 
shall serve a copy upon appellant. Should the answer not be received 
within 30 days, the Board may, in its discretion, enter a general denial 
on behalf of the Government, and the appellant shall be so notified.
    (c) A party who intends to raise an issue concerning the law of a 
foreign country shall give notice in his pleadings or other reasonable 
written notice. The Board, in determining foreign law, may consider any 
relevant material or source, including testimony, whether or not 
submitted by a party or admissible under Rules 11, 13 or 20. The 
determination of foreign law shall be treated as a ruling on a question 
of law.
    7. Amendments of Pleadings or Record. The Board upon its own 
initiative or upon application by a party may order a party to make a 
more definite statement of the complaint or answer, or to reply to an 
answer. The Board may, in its discretion, and within the proper scope of 
the appeal, permit either party to amend its pleading upon conditions 
fair to both parties. When issues within the proper scope of the appeal, 
but not raised by the pleadings, are tried by express or implied consent 
of the parties, or by permission of the Board, they shall be treated in 
all respects as if they had been raised therein. In such instances, 
motions to amend the pleadings to conform to the proof may be entered, 
but are not required. If evidence is objected to at a hearing on the 
ground that it is not within the issues raised by the pleadings, it may 
be admitted within the proper scope of the appeal, provided, however, 
that the objecting party may be granted a continuance if necessary to 
enable it to meet such evidence.
    8. Hearing Election. After filing of the Government's answer or 
notice from the Board that it has entered a general denial on behalf of 
the Government, each party shall advise whether it desires a hearing as 
prescribed in Rules 17 through 25, or whether it elects to submit its 
case on the record without a hearing, as prescribed in Rule 11.
    9. Prehearing Briefs. Based on an examination of the pleadings, and 
its determination of whether the arguments and authorities addressed to 
the issues are adequately set forth therein, the Board may, in its 
discretion, require the parties to submit prehearing briefs in any case 
in which a hearing has been elected pursuant to Rule 8. If the Board 
does not require prehearing briefs either party may, in its discretion 
and upon appropriate and sufficient notice to the other party, furnish a 
prehearing brief to the Board. In any case where a prehearing brief is 
submitted, it shall be furnished so as to be received by the Board at 
least 15 days prior to the date set for hearing, and a copy shall 
simultaneously be furnished to the other party as previously arranged.

[[Page 582]]

    10. Prehearing or Presubmission Conference. (a) Whether the case is 
to be submitted pursuant to Rule 11, or heard pursuant to Rules 17 
through 25, the Board may upon its own initiative, or upon the 
application of either party, arrange a telephone conference or call upon 
the parties to appear before an administrative judge or examiner of the 
Board for a conference to consider:
    (1) Simplification, clarification, or severing of the issues;
    (2) The possibility of obtaining stipulations, admissions, 
agreements and rulings on admissibility of docments, understandings on 
matters already of record, or similar agreements that will avoid 
unnecessary proof;
    (3) Agreements and rulings to facilitate discovery;
    (4) Limitation of the number of expert witnesses, or avoidance of 
similar cumulative evidence;
    (5) The possibility of agreement disposing of any or all of the 
issues in dispute; and
    (6) Such other matters as may aid in the disposition of the appeal.
    (b) The administrative judge or examiner of the Board shall make 
such rulings and orders as may be appropriate to aid in the disposition 
of the appeal. The results of pretrial conferences, including any 
rulings and orders, shall be reduced to writing by the administrative 
judge or examiner and this writing shall thereater constitute a part of 
the record.
    11. Submission Without a Hearing. Either party may elect to waive a 
hearing and to submit its case upon the record before the Board, as 
settled pursuant to Rule 13. Submission of a case without hearing does 
not relieve the parties from the necessity of proving the facts 
supporting their allegations or defenses. Affidavits, depositions, 
admissions, answers to interrogatories, and stipulations may be employed 
to supplement other documentary evidence in the Board record. The Board 
may permit such submissions to be supplemented by oral argument 
(transcribed if requested), and by briefs arranged in accordance with 
Rule 23.
    12. Optional SMALL CLAIMS (EXPEDITED) and ACCELERATED Procedures. 
These procedures are available solely at the election of the appellant.
    12.1  Elections to Utilize SMALL CLAIMS (EXPEDITED) and ACCELERATED 
Procedures. (a) In appeals where the amount in dispute is $10,000 or 
less, the appellant may elect to have the appeal processed under a SMALL 
CLAIMS (EXPEDITED) procedure requiring decision of the appeal, whenever 
possible, within 120 days after the Board receives written notice of the 
appellant's election to utilize this procedure. The details of this 
procedure appear in section 12.2 of this Rule. An appellant may elect 
the ACCELERATED procedure rather than the SMALL CLAIMS (EXPEDITED) 
procedure for any appeal eligible for the SMALL CLAIMS (EXPEDITED) 
procedure.
    (b) In appeals where the amount in dispute is $50,000 or less, the 
appellant may elect to have the appeal processed under an ACCELERATED 
procedure requiring decision of the appeal, whenever possible, within 
180 days after the Board receives written notice of the appellant's 
election to utilize this procedure. The details of this procedure appear 
in section 12.3 of this Rule.
    (c) The appellant's election of either the SMALL CLAIMS (EXPEDITED) 
procedure or the ACCELERATED procedure may be made by written notice 
within 60 days after receipt of notice of docketing, unless such period 
is extended by the Board for good cause. The election may not be 
withdrawn except with permission of the Board and for good cause.
    12.2  The Small Claims (Expedited) Procedure. (a) In cases 
proceeding under the SMALL CLAIMS (EXPEDITED) procedure, the following 
time periods shall apply:
    (1) Within 10 days from the Government's first receipt from either 
the appellant or the Board of a copy of the appellant's notice of 
election of the SMALL CLAIMS (EXPEDITED) procedure, the Government shall 
send the Board a copy of the contract, the contracting officer's final 
decision, and the appellant's claim letter or letters, if any; remaining 
documents required under Rule 4 shall be submitted in accordance with 
times specified in that rule unless the Board otherwise directs.
    (2) Within 15 days after the Board has acknowledged receipt of 
appellant's notice of election, the assigned administrative judge shall 
take the following actions, if feasible, in an informal meeting or a 
telephone conference with both parties: (i) Identify and simplify the 
issues; (ii) establish a simplified procedure appropriate to the 
particular appeal involved; (iii) determine whether either party wants a 
hearing, and if so, fix a time and place therefor; (iv) require the 
Government to furnish all the additional documents relevant to the 
appeal; and (v) establish an expedited schedule for resolution of the 
appeal.
    (b) Pleadings, discovery, and other prehearing activity will be 
allowed only as consistent with the requirement to conduct the hearing 
on the date scheduled, or if no hearing is scheduled, to close the 
record on a date that will allow decisions within the 120-day limit. The 
Board, in its discretion, may impose shortened time periods for any 
actions prescribed or allowed under these rules, as necessary to enable 
the Board to decide the appeal within the 120-day limit, allowing 
whatever time, up to 30 days, that the Board considers necessary for the 
preparation of the decision after closing the record and the filing of 
briefs, if any.

[[Page 583]]

    (c) Written decision by the Board in cases processed under the SMALL 
CLAIMS (EXPEDITED) procedure will be short and contain only summary 
findings of fact and conclusions. Decisions will be rendered for the 
Board by a single administrative judge. If there has been a hearing, the 
administrative judge presiding at the hearing may, in the judge's 
discretion, at the conclusion of the hearing and after entertaining such 
oral arguments as deemed appropriate, render on the record oral summary 
findings of fact, conclusions, and a decision of the appeal. Whenever 
such an oral decision is rendered, the Board will subsequently furnish 
the parties a typed copy of such oral decision for record and payment 
purposes and to establish the starting date for the period for filing a 
motion for reconsideration under rule 29.
    (d) A decision against the Government or the contractor shall have 
no value as precedent, and in the absence of fraud shall be final and 
conclusive and may not be appealed or set aside.
    12.3  The Accelerated Procedure. (a) In cases proceeding under the 
Accelerated procedure, the parties are encouraged, to the extent 
possible consistent with adequate presentation of their factual and 
legal positions, to waive pleadings, discovery, and briefs. The Board, 
in its discretion, may shorten time periods prescribed or allowed 
elsewhere in these rules, including rule 4, as necessary to enable the 
Board to decide the appeal within 180 days after the Board has received 
the appellant's notice of election of the ACCELERATED procedure, and may 
reserve 30 days for preparation of the decision.
    (b) Written decision by the Board in cases processed under the 
ACCELERATED procedure will normally be short and contain only summary 
findings of fact and conclusions. Decisions will be rendered for the 
Board by a single administrative judge with the concurrence of a vice 
chairman, or by a majority among these two and the chairman in case of 
disagreement. Alternatively, in cases where the amount in dispute is 
$10,000 or less as to which the ACCELERATED procedure has been elected 
and in which there has been a hearing, the single administrative judge 
presiding at the hearing may, with the concurrence of both parties, at 
the conclusion of the hearing and after entertaining such oral arguments 
as deemed appropriate, render on the record oral summary findings of 
fact, conclusions, and a decision of the appeal. Whenever such an oral 
decision is rendered, the Board will subsequently furnish the parties a 
typed copy of such oral decision for record and payment purposes, and to 
establish the starting date for the period of filing a motion for 
reconsideration under Rule 29.
    12.4  Motions for Reconsideration in Rule 12 Cases. Motions for 
Reconsideration of cases decided under either the SMALL CLAIMS 
(EXPEDITED) procedure or the ACCELERATED procedure need not be decided 
within the original 120-day or 180-day limit, but all such motions shall 
be processed and decided rapidly so as to fulfill the intent of this 
Rule.
    13.  Settling the Record. (a) The record upon which the Board's 
decision will be rendered consists of the documents furnished under 
Rules 4 and 12, to the extent admitted in evidence, and the following 
items, if any: pleadings, prehearing conference memoranda or orders, 
prehearing briefs, depositions or interrogatories received in evidence, 
admissions, stipulations, transcripts of conferences and hearings, 
hearing exhibits, post-hearing briefs, and documents which the Board has 
specifically designated be made a part of the record. The record will, 
at all reasonable times, be available for inspection by the parties at 
the office of the Board.
    (b) Except as the Board may otherwise order in its discretion, no 
proof shall be received in evidence after completion of an oral hearing 
or, in cases submitted on the record, after notification by the Board 
that the case is ready for decision.
    (c) The weight to be attached to any evidence of record will rest 
within the sound discretion of the Board. The Board may in any case 
require either party, with appropriate notice to the other party, to 
submit additional evidence on any matter relevant to the appeal.
    14. Discovery--Depositions--(a) General Policy and Protective 
Orders-- The parties are encouraged to engage in voluntary discovery 
procedures. In connection with any deposition or other discovery 
procedure, the Board may make any order required to protect a party or 
person from annoyance, embarrassment, or undue burden or expense. Those 
orders may include limitations on the scope, method, time and place for 
discovery, and provisions for protecting the secrecy of confidential 
information or documents.
    (b) When Depositions Permitted--After an appeal has been docketed 
and complaint filed, the parties may mutually agree to, or the Board 
may, upon application of either party, order the taking of testimony of 
any person by deposition upon oral examination or written 
interrogatories before any officer authorized to administer oaths at the 
place of examination, for use as evidence or for purpose of discovery. 
The application for order shall specify whether the purpose of the 
deposition is discovery or for use as evidence.
    (c) Orders on Depositions--The time, place, and manner of taking 
depositions shall be as mutually agreed by the parties, or failing such 
agreement, governed by order of the Board.
    (d) Use as Evidence--No testimony taken by depositions shall be 
considered as part of the evidence in the hearing of an appeal until

[[Page 584]]

such testimony is offered and received in evidence at such hearing. It 
will not ordinarily be received in evidence if the deponent is present 
and can testify at the hearing. In such instances, however, the 
deposition may be used to contradict or impeach the testimony of the 
deponent given at the hearing. In cases submitted on the record, the 
Board may, in its discretion, receive depositions to supplement the 
record.
    (e) Expenses--Each party shall bear its own expenses associated with 
the taking of any deposition.
    (f) Subpoenas--Where appropriate, a party may request the issuance 
of a subpoena under the provisions of Rule 21.
    15. Interrogatories to Parties, Admission of Facts, and Production 
and Inspection of Documents. After an appeal has been docketed and 
complaint filed with the Board, a party may serve on the other party: 
(a) Written interrogatories to be answered separately in writing, signed 
under oath and answered or objected to within 45 days after service; (b) 
a request for the admission of specified facts and/or the authenticity 
of any documents, to be answered or objected to within 45 days after 
service; the factual statements and the authenticity of the documents to 
be deemed admitted upon failure of a party to respond to the request; 
and (c) a request for the production, inspection and copying of any 
documents or objects not privileged, which reasonably may lead to the 
discovery of admissible evidence, to be answered or objected to within 
45 days after service. The Board may allow a shorter or longer time. Any 
discovery engaged in under this Rule shall be subject to the provisions 
of Rule 14(a) with respect to general policy and protective orders, and 
of Rule 35 with respect to sanctions.
    16. Service of Papers Other Than Subpoenas. Papers shall be served 
personally or by mail, addressed to the party upon whom service is to be 
made. Copies of complaints, answers and briefs shall be filed directly 
with the Board. The party filing any other paper with the Board shall 
send a copy thereof to the opposing party, noting on the paper filed 
with the Board that a copy has been so furnished. Subpoenas shall be 
served as provided in Rule 21.

                                Hearings

    17. Where and When Held. Hearings will be held at such places 
determined by the Board to best serve the interests of the parties and 
the Board. Hearings will be scheduled at the discretion of the Board 
with due consideration to the regular order of appeals, Rule 12 
requirements, and other pertinent factors. On request or motion by 
either party and for good cause, the Board may, in its discretion, 
adjust the date of a hearing.
    18. Notice of Hearings. The parties shall be given at least 15 days 
notice of the time and place set for hearings. In scheduling hearings, 
the Board will consider the desires of the parties and the requirement 
for just and inexpensive determination of appeals without unnecessary 
delay. Notices of hearings shall be promptly acknowledged by the 
parties.
    19. Unexcused Absence of a Party. The unexcused absence of a party 
at the time and place set for hearing will not be occasion for delay. In 
the event of such absence, the hearing will proceed and the case will be 
regarded as submitted by the absent party as provided in Rule 11.
    20. Hearings: Nature, Examination of Witnesses--(a) Nature of 
Hearings--Hearings shall be as informal as may be reasonable and 
appropriate under the circumstances. Appellant and the Government may 
offer such evidence as they deem appropriate and as would be admissible 
under the Federal Rules of Evidence or in the sound discretion of the 
presiding administrative judge or examiner. Stipulations of fact agreed 
upon by the parties may be regarded and used as evidence at the hearing. 
The parties may stipulate the testimony that would be given by a witness 
if the witness were present. The Board may require evidence in addition 
to that offered by the parties.
    (b) Examination of Witnesses--Witnesses before the Board will be 
examined orally under oath or affirmation, unless the presiding 
administrative judge or examiner shall otherwise order. If the testimony 
of a witness is not given under oath, the Board may advise the witness 
that his statements may be subject to the provisions of title 18, United 
States Code, sections 287 and 1001, and any other provision of law 
imposing penalties for knowingly making false representations in 
connection with claims against the United States or in any matter within 
the jurisdiction of any department or agency thereof.
    21. Subpoenas--(a) General-- Upon written request of either party 
filed with the recorder, or on his own initiative, the administrative 
judge to whom a case is assigned or who is otherwise designated by the 
chairman may issue a subpoena requiring:
    (i) Testimony at a deposition--the deposing of a witness in the city 
or county where he resides or is employed or transacts his business in 
person, or at another location convenient for him that is specifically 
determined by the Board;
    (ii) Testimony at a hearing--the attendance of a witness for the 
purpose of taking testimony at a hearing; and
    (iii) Production of books and papers--in addition to (i) or (ii), 
the production by the witness at the deposition or hearing of books and 
papers designated in the subpoena.
    (b) Voluntary Cooperation--Each party is expected (i) to cooperate 
and make available witnesses and evidence under its control as

[[Page 585]]

requested by the other party, without issuance of a subpoena, and (ii) 
to secure voluntary attendance of desired third-party witnesses and 
production of desired third-party books, papers, documents, or tangible 
things whenever possible.
    (c) Requests for Subpoenas--(1) A request for subpoena shall 
normally be filed at least:
    (i) 15 days before a scheduled deposition where the attendance of a 
witness at a deposition is sought; or
    (ii) 30 days before a scheduled hearing where the attendance of a 
witness at a hearing is sought.
    In its discretion the Board may honor requests for subpoenas not 
made within these time limitations.
    (2) A request for a subpoena shall state the reasonable scope and 
general relevance to the case of the testimony and of any books and 
papers sought.
    (d) Requests to Quash or Modify-- Upon written request by the person 
subpoenaed or by a party, made within 10 days after service but in any 
event not later than the time specified in the subpoena for compliance, 
the Board may (i) quash or modify the subpoena if it is unreasonable and 
oppressive or for other good cause shown, or (ii) require the person in 
whose behalf the subpoena was issued to advance the reasonable cost of 
producing subpoenaed books and papers. Where circumstances require, the 
Board may act upon such a request at any time after a copy has been 
served upon the opposing party.
    (e) Form; Issuance--(1) Every subpoena shall state the name of the 
Board and the title of the appeal, and shall command each person to whom 
it is directed to attend and give testimony, and if appropriate, to 
produce specified books and papers at a time and place therein 
specified. In issuing a subpoena to a requesting party, the 
administrative judge shall sign the subpoena and may, in his discretion, 
enter the name of the witness and otherwise leave it blank. The party to 
whom the subpoena is issued shall complete the subpoena before service.
    (2) Where the witness is located in a foreign country, a letter 
rogatory or subpoena may be issued and served under the circumstances 
and in the manner provided in 28 U.S.C. 1781-1784.
    (f) Service--(1) The party requesting issuance of a subpoena shall 
arrange for service.
    (2) A subpoena requiring the attendance of a witness at a deposition 
or hearing may be served at any place. A subpoena may be served by a 
United States marshal or deputy marshal, or by any other person who is 
not a party and not less than 18 years of age. Service of a subpoena 
upon a person named therein shall be made by personally delivering a 
copy to that person and tendering the fees for one day's attendance and 
the mileage provided by 28 U.S.C. 1821 or other applicable law; however, 
where the subpoena is issued on behalf of the Government, money payments 
need not be tendered in advance of attendance.
    (3) The party at whose instance a subpoena is issued shall be 
responsible for the payment of fees and mileage of the witness and of 
the officer who serves the subpoena. The failure to make payment of such 
charges on demand may be deemed by the Board as a sufficient ground for 
striking the testimony of the witness and the books or papers the 
witness has produced.
    (g) Contumacy or Refusal to Obey a Subpoena-- In case of contumacy 
or refusal to obey a subpoena by a person who resides, is found, or 
transacts business within the jurisdiction of a United States District 
Court, the Board will apply to the Court through the Attorney General of 
the United States for an order requiring the person to appear before the 
Board or a member thereof to give testimony or produce evidence or both. 
Any failure of any such person to obey the order of the Court may be 
punished by the Court as a contempt thereof.
    22. Copies of Papers. When books, records, papers, or documents have 
been received in evidence, a true copy thereof or of such part thereof 
as may be material or relevant may be substituted therefor, during the 
hearing or at the conclusion thereof.
    23. Post-Hearing Briefs. Post-hearing briefs may be submitted upon 
such terms as may be directed by the presiding administrative judge or 
examiner at the conclusion of the hearing.
    24. Transcript of Proceedings. Testimony and argument at hearings 
shall be reported verbatim, unless the Board otherwise orders. Waiver of 
transcript may be especially suitable for hearings under Rule 12.2. 
Transcripts of the proceedings shall be supplied to the parties at such 
rates as may be established by contract between the Board and the 
reporter, provided that ordinary copy of transcript shall be supplied to 
the appellant at an amount no greater than the cost of duplication.
    25. Withdrawal of Exhibits. After a decision has become final the 
Board may, upon request and after notice to the other party, in its 
discretion permit the withdrawal of original exhibits, or any part 
thereof, by the party entitled thereto. The substitition of true copies 
of exhibits or any part thereof may be required by the Board in its 
discretion as a condition of granting permission for such withdrawal.

                             Representation

    26. The Appellant. An individual appellant may appear before the 
Board in person, a corporation by one of its officers; and a partnership 
or joint venture by one of its members; or any of these by an attorney 
at law duly licensed in any state, commonwealth, territory, the District 
of Columbia, or in a

[[Page 586]]

foreign country. An attorney representing an appellant shall file a 
written notice of appearance with the Board.
    27. The Government. Government counsel may, in accordance with their 
authority, represent the interest of the Government before the Board. 
They shall file notices of appearance with the Board, and notice thereof 
will be given appellant or appellant's attorney in the form specified by 
the Board from time to time.

                                Decisions

    28. Decisions. (a) Decisions of the Board will be made in writing 
and authenticated copies of the decision will be forwarded 
simultaneously to both parties. The rules of the Board and all final 
orders and decisions (except those required for good cause to be held 
confidential and not cited as precedents) shall be open for public 
inspection at the offices of the Board. Decisions of the Board will be 
made solely upon the record, as described in Rule 13.
    (b) Any monetary award to a contractor by the Board shall be 
promptly paid in accordance with the procedures provided by section 1302 
of the Act of July 27, 1956 (70 Stat. 694, as amended; 31 U.S.C. 724a). 
To assure prompt payment the Recorder will forward a waiver form to each 
party with the decision. If the parties do not contemplate an appeal or 
motion for reconsideration, they will execute waivers which so state, 
and return them to the Recorder. The Recorder will forward the waivers 
and a certified copy of the award decision to the General Accounting 
Office for certification for payment.

                       Motion for Reconsideration

    29. Motion for Reconsideration. A motion for reconsideration may be 
filed by either party. It shall set forth specifically the grounds 
relied upon to sustain the motion. The motion shall be filed within 30 
days from the date of the receipt of a copy of the decision of the Board 
by the party filing the motion.

              Suspensions, Dismissals and Defaults: Remands

    30. Suspensions; Dismissal Without Prejudice. The Board may suspend 
the proceedings by agreement of counsel for settlement discussions, or 
for good cause shown. In certain cases, appeals docketed before the 
Board are required to be placed in a suspense status and the Board is 
unable to proceed with disposition thereof for reasons not within the 
control of the Board. Where the suspension has continued, or may 
continue, for an inordinate length of time, the Board may, in its 
discretion, dismiss such appeals from its docket without prejudice to 
their restoration when the cause of suspension has been removed. Unless 
either party or the Board acts within three years to reinstate any 
appeal dismissed without prejudice, the dismissal shall be deemed with 
prejudice.
    31. Dismissal or Default for Failure to Prosecute or Defend. 
Whenever a record discloses the failure of either party to file 
documents required by these rules, respond to notices or correspondence 
from the Board, comply with orders of the Board, or otherwise indicates 
an intention not to continue the prosecution or defense of an appeal, 
the Board may, in the case of a default by the appellant, issue an order 
to show cause why the appeal should not be dismissed or, in the case of 
a default by the Government, issue an order to show cause why the Board 
should not act thereon pursuant to Rule 35. If good cause is not shown, 
the Board may take appropriate action.
    32. Remand from Court. Whenever any court remands a case to the 
Board for further proceedings, each of the parties shall, within 20 days 
of such remand, submit a report to the Board recommending procedures to 
be followed so as to comply with the court's order. The Board shall 
consider the reports and enter special orders governing the handling of 
the remanded case. To the extent the court's directive and time 
limitations permit, such orders shall conform to these rules.

                    Time, Computation and Extensions

    33. Time, Computation and Extensions. (a) Where possible, procedural 
actions should be taken in less time than the maximum time allowed. 
Where appropriate and justified, however, extensions of time will be 
granted. All requests for extensions of time shall be in writing.
    (b) In computing any period of time, the day of the event from which 
the designated period of time begins to run shall not be included, but 
the last day of the period shall be included unless it is a Saturday, 
Sunday, or a legal holiday, in which event the period shall run to the 
end of the next business day.

                         Ex Parte Communications

    34. Ex parte Communications. No member of the Board or the Board's 
staff shall entertain, nor shall any person directly or indirectly 
involved in an appeal, submit to the Board or the Board's staff, off the 
record, any evidence, explanation, analysis, or advice, whether written 
or oral, regarding any matter at issue in an appeal. This provision does 
not apply to consultation among Board members or to ex parte 
communications concerning the Board's administrative functions or 
procedures.

                                Sanctions

    35. Sanctions. If any party fails or refuses to obey an order issued 
by the Board, the Board may then make such order as it considers

[[Page 587]]

necessary to the just and expeditious conduct of the appeal.

                    Effective Date and Applicability

    36. Effective Date. These rules shall apply (i) mandatorily, to all 
appeals relating to contracts entered into on or after 1 March 1979, and 
(ii) at the contractor's election, to appeals relating to earlier 
contracts, with respect to claims pending before the contracting officer 
on 1 March 1979 or initiated thereafter.
    Pursuant to the Charter of the Armed Services Board of Contract 
Appeals, the attached rules are hereby approved for use and application 
to appeals to the Armed Services Board of Contract Appeals under the 
Contract Disputes Act of 1978.

(signed) William J. Perry (30 JUN 1980),
Under Secretary of Defense for Research and Engineering.
(signed) Percy A. Pierre,
Assistant Secretary of the Army (Research, Development and Acquisition).
(signed) J.A. Doyle,
Assistant Secretary of the Navy (Manpower, Reserve Affairs and 
Logistics).
(signed) Eugene H. Kopf,
(Acting) Assistant Secretary of the Air Force (Research, Development and 
Logistics).
[56 FR 36572, July 31, 1991, as amended at 58 FR 37868, July 14, 1993]

             Appendix B--Coordinated Acquisition Assignments

                        Part 1--Army Assignments

                        Part 2--Navy Assignments

                      Part 3--Air Force Assignments

              Part 4--Defense Logistics Agency Assignments

           Part 5--Defense Special Weapons Agency Assignments

           Part 6--General Services Administration Assignments

    Authority; 41 U.S.C. 421 and 48 CFR chapter 1.

                        Part 1--Army Assignments

                                                                        
------------------------------------------------------------------------
     Federal supply class code                    Commodity             
------------------------------------------------------------------------
                                    Electronic Equipment.               
                                    Each department is assigned         
                                     acquisition responsibility for     
                                     those items which the department   
                                     either designed or for which it    
                                     sponsored development. See FSC 5821
                                     under Navy listings for assignment 
                                     of certain commercially developed  
                                     radio sets (i.e., developed without
                                     the use of Government funds).      
1005 P \1\........................  Guns, through 30mm.                 
                                    This partial assignment applies to  
                                     guns, through 30mm, and parts and  
                                     equipment therefor, as listed in   
                                     Department of Army Supply Manuals/ 
                                     Catalogs. It does not apply to Navy
                                     ordnance type guns; MK 11 and MK   
                                     12, 20mm gun; and aircraft gun     
                                     mounts.                            
1010 P \1\........................  Guns, over 30mm up to 75mm.         
                                    This partial assignment applies to  
                                     guns, over 30mm and up to 75mm, and
                                     parts and equipment therefor, as   
                                     listed in Department of the Army   
                                     Supply Manuals/Catalogs. It does   
                                     not apply to Naval ordnance type   
                                     guns and aircraft gun mounts.      
1015 P \1\........................  Guns, 75mm through 125mm.           
                                    This partial assignment applies to  
                                     guns, 75mm through 125mm, and parts
                                     and equipment therefor, as listed  
                                     in Department of Army Supply       
                                     Manuals/Catalogs. It does not apply
                                     to Naval ordnance type guns.       
1020 P \1\........................  Guns over 125mm through 150mm.      
1025 P \1\........................  Guns over 150mm through 200mm.      
1030 P \1\........................  Guns over 200mm through 300mm.      
1035 P \1\........................  Guns over 300mm.                    
                                    These partial assignments apply to  
                                     guns, over 125mm, and parts and    
                                     equipment therefor, as listed in   
                                     Department of Army Supply Manuals/ 
                                     Catalogs. They do not apply to     
                                     Naval ordnance type guns.          
1040..............................  Chemical Weapons and Equipment.     
1055 P \1\........................  Launchers, Rocket and Pyrotechnic.  
                                    This partial assignment applies to  
                                     launchers, rocket and pyrotechnic, 
                                     as listed in Department of Army    
                                     Supply Manuals/Catalogs. It does   
                                     not apply to Naval ordnance type   
                                     and airborne type, with the        
                                     exception of 2.75 inch rocket      
                                     launchers which are included in    
                                     this partial FSC assignment to the 
                                     Department of the Army.            
1090 P............................  Assemblies Interchangeable Between  
                                     Weapons in Two or More Classes.    
                                    This partial assignment applies to  
                                     the following items:               
------------------------------------------------------------------------
NOTE: (``P'' after the FSC number indicates a partial FSC assignment)   
-----------------------------------                                     
                                    National stock number nomenclature. 
                                      1090-563-7232 Staff Section,      
                                     Class.                             
                                      1090-699-0633 Staff Section.      
                                      1090-796-8760 Power Supply.       
                                      1090-885-8451 Wrench Corrector.   
                                      1090-986-9707 Reticle Assembly.   
1095 P \1\........................  Miscellaneous Weapons.              
                                    This partial assignment applies to  
                                     miscellaneous weapons, and parts   
                                     and equipment therefor, as listed  
                                     in Department of Army Supply       
                                     Manuals/Catalogs. It does not apply
                                     to Naval ordnance type; line       
                                     throwing guns (which are under DoD 
                                     Coordinated Acquisition assignment 
                                     to the Department of the Navy); and
                                     aircraft type miscellaneous        
                                     weapons.                           
1210 P \1\........................  Fire Control Directors.             
1220 P \1\........................  Fire Control Computing Sights and   
                                     Devices.                           
1230 P \1\........................  Fire Control Systems, Complete.     
1240 P \1\........................  Optical Sighting and Ranging        
                                     Equipment.                         
1250 P \1\........................  Fire Control Stabilizing Mechanisms.
1260 P \1\........................  Fire Control Designating and        
                                     Indicating Equipment.              
1265 P \1\........................  Fire Control Transmitting and       
                                     Receiving Equipment, Except        
                                     Airborne.                          

[[Page 588]]

                                                                        
1285 P \1\........................  Fire Control Radar Equipment, Except
                                     Airborne.                          
1290 P \1\........................  Miscellaneous Fire Control          
                                     Equipment.                         
                                    The above nine partial FSC          
                                     assignments apply to fire control  
                                     equipment, as listed in Department 
                                     of the Army Supply Manuals/        
                                     Catalogs. They do not apply to     
                                     Naval ordnance type and aircraft   
                                     type.                              
1305 P \1\........................  Ammunition, through 30mm.           
                                    This partial assignment applies to  
                                     ammunition through 30mm as listed  
                                     in Department of Army Supply       
                                     Manuals/Catalogs. It does not apply
                                     to Naval ordnance type and         
                                     ammunition for the MK 11 and MK 12,
                                     20mm gun.                          
1310 P \1\........................  Ammunition, over 30mm up to 75mm.   
                                    This partial assignment applies to  
                                     ammunition, over 30mm up to 75mm,  
                                     as listed in Department of Army    
                                     Supply Manuals/Catalogs. It does   
                                     not apply to Naval ordnance type   
                                     and to 40mm ammunition (which is   
                                     under DoD Coordinated Acquisition  
                                     assignment to the Navy). The Army  
                                     is responsible for the acquisition 
                                     of fillers and the loading,        
                                     assembling, and packing of         
                                     toxicological, incapacitating riot 
                                     control, smoke and incendiary      
                                     munitions.                         
1315 P \1\........................  Ammunition, 75mm through 125mm.     
                                    This partial assignment applies to  
                                     ammunition, 75mm through 125mm, as 
                                     listed in Department of Army Supply
                                     Manuals/Catalogs. It does not apply
                                     to Naval ordnance type. The Army is
                                     responsible for the acquisition of 
                                     fillers and the loading,           
                                     assembling, and packing of         
                                     toxicological, incapacitating riot 
                                     control, smoke and incendiary      
                                     munitions.                         
1320 P \1\........................  Ammunition, over 125mm.             
                                    This partial assignment applies to  
                                     ammunition over 125mm, as listed in
                                     Department of Army Supply Manuals/ 
                                     Catalogs. It does not apply to     
                                     Naval ordnance type. The Army is   
                                     responsible for the acquisition of 
                                     fillers and the loading,           
                                     assembling, and packing of         
                                     toxicological, incapacitating riot 
                                     control, smoke and incendiary      
                                     munitions.                         
1325 P............................  Bombs.                              
                                    This partial assignment applies to  
                                     bombs as listed in Department of   
                                     Army Supply Manuals/Catalogs. It   
                                     does not apply to Navy assigned    
                                     bombs as shown in list of          
                                     assignments to the Navy; however,  
                                     the Department of the Army is      
                                     responsible for the acquisition of 
                                     fillers and the loading,           
                                     assembling, and packing of         
                                     toxicological, incapacitating riot 
                                     control, smoke and incendiary      
                                     munitions, and for other loading,  
                                     assembling, and packing in excess  
                                     of Navy owned capacity.            
1330..............................  Grenades.                           
1340 P............................  Rockets and Rocket Ammunition.      
                                    This partial assignment applies to: 
                                      66mm Rocket, HEAT, M72.           
                                      2.75'' Rocket FFAR, Service and   
                                     Practice.                          
                                      Heads MK5 and Mods (HEAT).        
                                      HE, M151.                         
                                      HE, XM229 (17 lb Warhead)         
                                      HE, XM157 (Spotting Red).         
                                      HE, XM158 (Spotting Yellow).      
                                      MK61 Practice (5 lb Slug).        
                                      XM230 Practice (10 lb).           
                                    Motors MK4 and Mods (High           
                                     Performance Aircraft).             
                                      MK40 and Mods (Low Performance    
                                     Aircraft).                         
                                    3.5 inch Rocket Heat, M35.          
                                      Practice, M36.                    
                                      Smoke, WP, M30.                   
                                    4.5 inch Motor, Drill, M24.         
                                    HE, M32.                            
                                    Practice, M33.                      
                                    Incendiary and toxicological        
                                     rockets, as listed in Army Supply  
                                     Bulletins. It does not apply to    
                                     Navy assigned rockets as shown in  
                                     the list of assignments to the     
                                     Navy. However, the Department of   
                                     the Army is responsible for        
                                     acquisition of filler and for      
                                     filling of all smoke and           
                                     toxicological rockets.             
1345..............................  Land Mines.                         
1365..............................  Military Chemical Agents.           
1370 P............................  Pyrotechnics.                       
                                    This partial assignment does not    
                                     apply to shipboard and aircraft    
                                     pyrotechnics.                      
1375 P............................  Demolition Materials.               
                                    This partial assignment applies to  
                                     Blasting Agents and supplies such  
                                     as:                                
                                      Bangalore torpedo.                
                                      Blocks, demolition.               
                                      Caps, blasting, electric and non- 
                                     electric.                          
                                      Charge, cratering.                
                                      Charge, shaped and demolition.    
                                      Chests, demolition platoon and    
                                     squad.                             
                                      Cord detonating.                  
                                      Demolition equipment sets, with   
                                     ancillary items.                   
                                      Detonators, all types.            
                                      Dynamite.                         
                                      Firing devices.                   
                                      Fuze, safety.                     
                                      Kit, demolition.                  
                                      Lighter, fuse.                    
                                      Machine, blasting.                
                                      Primer, percussion cap.           
                                    It does not apply to Navy underwater
                                     demolition requirements.           
1376 P............................  Bulk Explosives.                    
                                    This partial assignment applies to  
                                     solid propellants and explosives   
                                     such as:                           
                                      Ammonium Picrate (Explosive D) JAN-
                                     A-166A.                            
                                      Trinitrotoluene (TNT) MIL-T-248A. 
                                      Tetryl JAN-T-339.                 
                                      Pantaerythrite Tetranitrate (PETN)
                                     JAN-P-387.                         
                                      RDX.                              
                                      Composition B.                    
                                      Composition B-3.                  
                                      Pentolite, 50.                    
                                      Composition C-3.                  
                                      Composition A-3.                  
                                      Composition A-4.                  
                                      Nitroguanidine (Picrate).         
                                    It does not apply to production     
                                     capacity for any of the above      
                                     listed explosives at the U.S. Naval
                                     Propellant Plant, Indian Head,     
                                     Maryland.                          
1377 P............................  Cartridge and Propellant Actuated   
                                     Devices and Components.            
                                    This partial assignment is reserved 
                                     pending Services agreement as to   
                                     items to be included in the        
                                     assignment.                        
1380..............................  Military Biological Agents.         
1390 P \1\........................  Fuzes and Primers.                  

[[Page 589]]

                                                                        
                                    This partial assignment applies to  
                                     Fuzes and Primers for Army assigned
                                     ammunition. It does not apply to   
                                     Naval ordnance type, which is under
                                     DoD Coordinated Acquisition        
                                     assignment to the Department of the
                                     Navy; and guided missile fuzes.    
2210..............................  Locomotives.                        
2220..............................  Rail Cars.                          
2240..............................  Locomotive and Rail Car Accessories 
                                     and Components.                    
2250..............................  Track Materials, Railroad.          
2310 P............................  Passenger Motor Vehicles.           
2320 P............................  Trucks and Truck Tractors.          
                                    These two partial assignments apply 
                                     to tactical vehicles and the       
                                     following types of vehicles:       
                                      Bus, convertible to ambulance.    
                                      Truck, 4 x 4, convertible to      
                                     ambulance                          
                                      Truck 4 x 4, dump, 9,000 GVW, with
                                     cut-down cab.                      
                                    These assignments do not apply to   
                                     tracked landing vehicles which are 
                                     not under DoD Coordinated          
                                     Acquisition assignment, and airport
                                     crash rescue vehicles, which are   
                                     under DoD Coordinated Acquisition  
                                     assignment to the Department of the
                                     Air Force. With the exception of   
                                     the types enumerated above, these  
                                     assignments do not apply to        
                                     commercial, non-tactical, passenger
                                     carrying vehicles and trucks which 
                                     are assigned for DoD Coordinated   
                                     Acquisition to the General Services
                                     Administration.                    
2330 P............................  Trailers.                           
                                    This partial assignment does not    
                                     apply to two wheel lubrication     
                                     trailers, two wheel steam cleaning 
                                     trailers, and troop transporter    
                                     semitrailers which are not under   
                                     DoD Coordinated Acquisition        
                                     assignment, and airport crash      
                                     rescue trailer units which are     
                                     under DoD Coordinated Acquisition  
                                     assignment to the Department of the
                                     Air Force.                         
2340 P............................  Motorcycles, Motor Scooters, and    
                                     Bicycles.                          
                                    This partial assignment does not    
                                     apply to bicycles and tricycles.   
2350..............................  Tanks and Self-propelled Weapons.   
2430..............................  Tractors, Track Laying, High-Speed. 
2510 P \2\........................  Vehicular Cab, Body, and Frame      
                                     Structural Components.             
2520 P \2\........................  Vehicular Power Transmission        
                                     Components.                        
2530 P \2\........................  Vehicular Brake, Steering, Axle,    
                                     Wheel, and Track Components.       
2540 P \2\........................  Vehicular Furniture and Accessories.
2590 P \2\........................  Miscellaneous Vehicular Components. 
2610..............................  Tires and Tubes, Pneumatic, except  
                                     Aircraft.                          
2630..............................  Tires, solid and cushion.           
2640..............................  Tire Rebuilding and Tire and Tube   
                                     Repair Materials.                  
2805 P \2\........................  Gasoline Reciprocating Engines,     
                                     except Aircraft and Components.    
2910 P \2\........................  Engine Fuel System Components,      
                                     Nonaircraft.                       
2920 P \2\........................  Engine Electrical System            
2930 P \2\........................  Engine Cooling System Components,   
                                     Nonaircraft.                       
2940 P \2\........................  Engine Air and Oil Filters,         
                                     Strainers and Cleaners,            
                                     Nonaircraft.                       
2990 P \2\........................  Miscellaneous Engine Accessories,   
                                     Nonaircraft.                       
4210 P............................  Fire Fighting Equipment.            
                                    This partial assignment applies only
                                     to equipment developed by or under 
                                     the sponsorship of the Department  
                                     of the Army.                       
4230 P............................  Decontaminating and Impregnating    
                                     Equipment.                         
                                    This partial assignment applies only
                                     to items peculiar to chemical      
                                     warfare.                           
4240 P............................  Safety and Rescue Equipment.        
                                    This partial assignment applies only
                                     to military respiratory protective 
                                     equipment for chemical warfare.    
5805 P............................  Telephone and Telegraph Equipment.  
                                    This partial assignment applies only
                                     to military (wire) equipment, field
                                     type.                              
5815 P............................  Teletype and Facsimile Equipment.   
                                    This partial assignment applies only
                                     to military (wire) equipment, field
                                     type.                              
5820 P............................  Radio and Television Communication  
                                     Equipment, except Airborne.        
                                    This partial assignment applies to  
                                     nontactical, off-the-shelf,        
                                     commercially available radio and   
                                     television equipment and supplies  
                                     used by the Armed Forces Radio and 
                                     Television Stations including      
                                     equipment and supplies used by the 
                                     Armed Forces for closed TV circuit 
                                     educational and training programs. 
5830 P............................  Intercommunication and Public       
                                     Address Systems; except Airborne.  
                                    This partial assignment applies only
                                     to military (wire) equipment, field
                                     type.                              
6135 P............................  Batteries, Primary.                 
                                    This partial assignment applies to  
                                     MIL type, dry cell batteries, only.
6625 P............................  Electrical and Electronic Properties
                                     Measuring and Testing Instruments. 
                                    This partial assignment applies only
                                     to instruments for testing military
                                     (wire) equipment, field type.      
6645 P............................  Time Measuring Instruments.         
                                    This partial assignment applies to  
                                     the following watches; aircraft    
                                     instrument panel clocks; cases and 
                                     spare parts therefor:              
                                      Master navigation watches; pocket 
                                     watches; stop watches; second      
                                     setting wrist watches; wrist       
                                     watches; athletic timers; aircraft 
                                     clocks; aircraft panel clocks;     
                                     mechanical aircraft clocks;        
                                     navigation watch cases; pocket     
                                     watch cases; watch holders; watch  
                                     case assemblies and watch          
                                     movements.                         
6660 P............................  Meteorological Instruments and      
                                     Apparatus.                         
                                    Each department is assigned         
                                     acquisition responsibility for     
                                     those systems, instruments and end 
                                     items in FSC 6660 which the        
                                     department either designed or      
                                     sponsored development. For purposes
                                     of this assignment, the developing 
                                     department is the department which 
                                     awarded the developmental contract,
                                     notwithstanding that other         
                                     departments may have provided funds
                                     for the development.               
6665 P............................  Hazard-Detecting Instruments and    
                                     Apparatus.                         
                                    This partial assignment applies only
                                     to items peculiar to chemical      
                                     warfare.                           
6695 P............................  Combination and Miscellaneous       
                                     Instruments.                       
                                    This partial assignment applies to  
                                     jewel bearings only.               
6820 P............................  Dyes.                               
                                    This partial assignment applies only
                                     to items peculiar to chemical      
                                     warfare.                           

[[Page 590]]

                                                                        
6910 P............................  Training Aids.                      
                                    This partial assignment applies only
                                     to items peculiar to Army          
                                     assignments under weapons, fire    
                                     control equipment, ammunition and  
                                     explosives, and chemical and       
                                     biological warfare.                
6920 P............................  Armament Training Devices.          
                                    This partial assignment applies to  
                                     armament training devices as listed
                                     in Department of Army Catalogs SC  
                                     6910, ML/IL and SC 6920 ML/IL. It  
                                     does not apply to clay pigeons in  
                                     Department of Army Catalogs SC     
                                     6910, ML/IL and SC 6920 ML/IL. It  
                                     does not apply to clay pigeons.    
6940 P............................  Communication Training Devices.     
                                    This partial assignment applies only
                                     to code training sets, code        
                                     practice equipment, and other      
                                     telephone and telegraph training   
                                     devices.                           
8130 P............................  Reels and Spools.                   
                                    This partial assignment applies only
                                     to reels and spools for military   
                                     (wire) equipment, field type.      
8140 P............................  Ammunition Boxes, Packages, and     
                                     Special Containers.                
                                    This partial assignment applies only
                                     to boxes, packages, and containers 
                                     peculiar to Army assignments under 
                                     ammunitions, explosives, and       
                                     chemical and biological warfare as 
                                     listed in Department of Army       
                                     Catalog SC 8140 IL and SC 8140 ML. 
------------------------------------------------------------------------
\1\ For contracting purposes, Naval ordnance comprises all arms, armor, 
  and armament for the Department of the Navy and includes all offensive
  and defensive weapons, together with their components, controlling    
  devices and ammunition used in executing the Navy's mission in        
  National Defense (except small arms and those items of aviation       
  ordnance acquired from the Army).                                     
\2\ These partial FSC assignments apply only to repair parts peculiar to
  combat and tactical vehicles. In addition, the assignment in FSC 2805 
  applies to military standard engines 1.5 HP through 20 HP and parts   
  peculiar therefor. Balance of these FSCs are assigned to the Defense  
  Logistics Agency (Defense Construction Supply Center).                

                        Part 2--Navy Assignments

                                                                        
------------------------------------------------------------------------
     Federal supply class code                    Commodity             
------------------------------------------------------------------------
                                    Electronic Equipment.               
                                    Each department is assigned         
                                     acquisition responsibility for     
                                     those items which the department   
                                     either designed or sponsored       
                                     development. See FSC 5821 for      
                                     assignment of certain commercially 
                                     developed radio sets to the        
                                     Department of the Navy (i.e.,      
                                     developed without the use of       
                                     Government funds).                 
1095 P............................  Miscellaneous Weapons.              
                                    This partial assignment applies to  
                                     line throwing guns only.           
1310 P............................  Ammunition, over 30mm up to 75mm.   
                                    This partial assignment applies only
                                     to reels and spools for military.  
1325 P............................  Bombs.                              
                                    This partial assignment applies to  
                                     armor-piercing; depth bombs;       
                                     externally suspended low drag      
                                     bombs; and components and practice 
                                     bombs therefor, as listed in Ord   
                                     Pamphlets, and the MK 43, Target   
                                     Detecting Device. The Department of
                                     the Army is responsible for the    
                                     acquisition of fillers and the     
                                     loading, assembling, and packing of
                                     toxicological, incapacitating riot 
                                     control, smoke and incendiary      
                                     munitions, and for other loading,  
                                     assembling, and packing in excess  
                                     of Navy-owned capacity.            
1340 P............................  Rockets and Rocket Ammunition.      
                                    This partial assignment applies to: 
                                    Fuze, Rocket, V.T., MK93-0.         
                                    2.25 inch Rocket SCAR, Practice.    
                                      Heads MK3 and Mods.               
                                      Motors MK15 and Mods.             
                                      MK16 and Mods.                    
                                    5 inch Rocket HVAR, service and     
                                     practice.                          
                                      Heads MK2 and Mods (common) MK6   
                                     and Mods (GP).                     
                                      MK4 and Mods (smoke) MK25 and Mods
                                     (ATAR).                            
                                      Motors MK10 and Mods.             
                                    5 inch Rocket FFAR service and      
                                     practice.                          
                                      Heads MK24 and Mods (General      
                                     Purposes).                         
-----------------------------------                                     
NOTE: (``P'' after the FSC number indicates a partial FSC assignment).  
------------------------------------------------------------------------
                                      MK32 and Mods (Shaped Charged).   
                                      MK26 and Mods (Illum).            
                                      Motor MK16 and Mods.              
                                    The Department of the Army is       
                                     responsible for acquisition of     
                                     filler and for filling of all smoke
                                     and toxicological rockets.         
1390 P............................  Fuzes and Primers.                  
                                    This partial assignment applies to  
                                     fuzes and primers for Navy assigned
                                     ammunition.                        
1550 P............................  Drones.                             
                                    This partial assignment applies only
                                     to Drone, Model BQM34E.            
1905 P............................  Combat Ships and Landing Vessels.   
                                    This partial assignment applies to  
                                     landing vessels only.              
1910 P............................  Transport Vessels, Passenger and    
                                     Troop.                             
                                    This partial assignment applies to  
                                     ferryboats only.                   
1920..............................  Fishing Vessels.                    
1925..............................  Special Service Vessels.            
1930..............................  Barges and Lighters, Cargo.         
1935 P............................  Barges and Lighters, Special        
                                     Purpose.                           
                                    This partial assignment does not    
                                     apply to derricks, pile drivers,   
                                     rock cutters, concrete mixing      
                                     plants, mechanical bank grader     
                                     barges, other bank revetment       
                                     barges, and barge power plants.    
1940..............................  Small Craft.                        
1945 P............................  Pontoons and Floating Docks.        
                                    This partial assignment applies only
                                     to Naval Facilities Engineering    
                                     Command type pontoons.             
1950..............................  Floating Drydocks.                  
1990 P............................  Miscellaneous Vessels.              
                                    This partial assignment applies to  
                                     commercial sailing vessels only.   
2010..............................  Ship and Boat Propulsion Components.
2020..............................  Rigging and Rigging Gear.           
2030..............................  Deck Machinery.                     
2040..............................  Marine Hardware and Hull Items.     

[[Page 591]]

                                                                        
2060..............................  Commercial Fishing Equipment.       
2090..............................  Miscellaneous Ship and Marine       
                                     Equipment.                         
2820 P............................  Steam Engines, Reciprocating and    
                                     Components.                        
                                    This partial assignment applies to  
                                     marine main propulsion steam       
                                     engines only.                      
2825 P............................  Steam Turbines and Components.      
                                    This partial assignment applies to  
                                     marine steam turbines only.        
4210 P............................  Fire Fighting Equipment.            
                                    This partial assignment applies only
                                     to fire fighting equipment         
                                     developed by or under the          
                                     sponsorship of the Department of   
                                     Navy.                              
4410 P............................  Industrial Boilers.                 
                                    This partial assignment applies only
                                     to boilers for use aboard those    
                                     ships assigned to the Navy for     
                                     coordinated acquisition.           
4420 P............................  Heat Exchangers and Steam           
                                     Condensers.                        
                                    This partial assignment applies only
                                     to heat exchangers for use aboard  
                                     those ships assigned to the Navy   
                                     for coordinated acquisition.       
4925 P............................  Ammunition Maintenance and Repair   
                                     Shop Specialized Equipment.        
                                    This partial assignment applies to  
                                     sets, kits, and outfits of tools   
                                     and equipment for explosive        
                                     ordnance as defined in military    
                                     service regulations and documents. 
5821 P............................  Radio and Television Communication  
                                     Equipment, Airborne.               
                                    This partial assignment applies only
                                     to the following commercially      
                                     developed radio sets. (The term    
                                     ``commercially developed'' means   
                                     that no Government funds were      
                                     provided for development purposes.)
                                     HF-101, 102, 103, 104, 105, 106,   
                                     107, 108, 109, 111, 113, ARC-94,   
                                     102, 105, 110, 112, 119, 120; MRC- 
                                     95, 108; VC-102, 104, 105, 106,    
                                     109, 110; and components of the    
                                     foregoing including the 490T       
                                     antenna coupler.                   
6125 P............................  Converters, Electrical, Rotating.   
                                    This partial assignment applies only
                                     to motor-generated sets for use    
                                     aboard ships assigned to the Navy  
                                     for coordinated acquisition.       
6320 P............................  Shipboard Alarm and Signal System.  
                                    This partial assignment applies only
                                     to alarm systems, fire alarm       
                                     systems, indicating systems,       
                                     telegraph systems (signal and      
                                     signaling) (less electronic type)  
                                     for use aboard ships assigned to   
                                     the Navy for coordinated           
                                     acquisition.                       
6605 P............................  Navigational Instruments.           
                                    This partial assignment applies only
                                     to lifeboat and raft compasses,    
                                     aircraft sextants, hand leads      
                                     (soundings), lead reels, sounding  
                                     machines and pelorus stands for use
                                     aboard ships assigned to the Navy  
                                     for coordinated acquisition.       
6645 P............................  Time Measuring Instruments.         
                                    This partial assignment applies to  
                                     the following instruments, cases,  
                                     and spare parts therefor:          
                                    Chronometers including gimbal,      
                                     padded and make break circuit.     
                                    Clocks, alarm, boat, deck, direct   
                                     reading, electrical, floor,        
                                     interval timer, marine, mechanical,
                                     master control, master program,    
                                     master regulating, mechanical      
                                     message center, nurses, program,   
                                     shelf, stop, wall, watchman's.     
                                    Counters, time period.              
                                    Meters, engine running time, hour   
                                     recording, and electrical time     
                                     totalizing.                        
                                    Timers; bombing, engine hours,      
                                     sequential, stop, and program.     
                                    Program control instrument.         
                                    Cases; chronometer, including gimbal
                                     and padded, chronometer carrying;  
                                     makebreak circuit chronometer.     
                                    Cans, chronometer shipping and      
                                     storage.                           
                                    Clock keys; clock movements, clock  
                                     motors.                            
6650 P............................  Optical Instruments.                
                                    This partial assignment applies only
                                     to stands, telescope, for use      
                                     aboard ships assigned to the Navy  
                                     for coordinated acquisition.       
6660 P............................  Meteorological Instruments and      
                                     Apparatus.                         
                                    Each department is assigned         
                                     acquisition responsibility for     
                                     those systems, instruments, and end
                                     items in FSC 6660 for which the    
                                     department either designed or      
                                     sponsored development. For purposes
                                     of this assignment, the developing 
                                     department is the department which 
                                     awarded the developmental contract,
                                     notwithstanding that other         
                                     departments may have provided funds
                                     for the development.               
6665 P............................  Hazard-Detecting Instruments and    
                                     Apparatus.                         
                                    This partial assignment applies only
                                     to hazard determining safety       
                                     devices, for use aboard ships      
                                     assigned to the Navy for           
                                     coordinated acquisition.           
8140 P............................  Ammunition Boxes, Packages, and     
                                     Special Containers.                
                                    This partial assignment applies only
                                     to boxes, packages, and containers 
                                     for 40mm ammunition.               
------------------------------------------------------------------------

                      Part 3--Air Force Assignments

                                                                        
------------------------------------------------------------------------
     Federal supply class code                    Commodity             
------------------------------------------------------------------------
                                    Electronic Equipment.               
                                    Each department is assigned         
                                     acquisition responsibility for     
                                     those items which the department   
                                     either designed or sponsored       
                                     development. See FSC 5821 under    
                                     Navy listing for assignment of     
                                     certain commercially developed     
                                     radio sets (i.e., developed without
                                     the use of Government funds).      
1550 P............................  Drones.                             
                                    This partial assignment applies only
                                     to the following model drones:     
                                      Model 147.                        
                                      Model 154.                        
                                      BQM 34A.                          
                                      MQM 34D.                          
2320 P............................  Trucks and Truck Tractors.          
                                    This partial assignment applies only
                                     to airport crash rescue vehicles.  
2330 P............................  Trailers.                           
                                    This partial assignment applies only
                                     to airport crash rescue trailer    
                                     units.                             
4210 P............................  Fire Fighting Equipment.            
                                    This partial assignment applies only
                                     to fire fighting equipment         
                                     developed by or under the          
                                     sponsorship of the Department of   
                                     the Air Force.                     
6660 P............................  Meteorological Instruments and      
                                     Apparatus.                         

[[Page 592]]

                                                                        
                                    Each department is assigned         
                                     acquisition responsibility for     
                                     those systems, instruments, and end
                                     items in FSC 6660 for which the    
                                     department either designed or      
                                     sponsored development. The         
                                     developing department is the       
                                     department which awarded the       
                                     developmental contract,            
                                     notwithstanding that other         
                                     departments may have provided funds
                                     for the development.               
6710 P \1\........................  Cameras, Motion Picture.            
                                    This partial assignment does not    
                                     apply to submarine periscope and   
                                     underwater cameras.                
6720 P \1\........................  Cameras, Still Picture.             
                                    This partial assignment does not    
                                     apply to submarine periscope and   
                                     underwater cameras.                
6730 P \1\........................  Photographic Projection Equipment.  
                                    This partial assignment does not    
                                     apply to 35mm theater projectors.  
6740 \1\..........................  Photographic Developing and         
                                     Finishing Equipment.               
6760 \1\..........................  Photographic Equipment and          
                                     Accessories.                       
6780 \1\..........................  Photographic Sets, Kits, and        
                                     Outfits.                           
------------------------------------------------------------------------
8820 P............................  Live Animals Not Raised for Food.   
                                    This partial assignment applies only
                                     to the following types of working  
                                     dogs:                              
                                        Scout.                          
                                        Sentry.                         
                                        Patrol.                         
                                        Mine/tunnel.                    
                                        Tracker.                        
                                        Detector-narcotic/contraband.   
                                        Sledge.                         
                                        Bloodhound.                     
                                        Water dog.                      
                                        Patrol/detector.                
------------------------------------------------------------------------
\1\ This partial FSC assignment does not apply to photographic equipment
  controlled by the Congressional Joint Committee on Printing and Micro-
  Film Equipment and Supplies.                                          

              Part 4--Defense Logistics Agency Assignments

                                                                        
------------------------------------------------------------------------
  Federal supply class                                                  
          code                   Commodity             DLA center \6\   
------------------------------------------------------------------------
2230...................  Right of Way Construction  DCSC                
                          and Maintenance                               
                          Equipment, Railroad.                          
2410...................  Tractor, Full Track, Low-  DCSC                
                          Speed.                                        
2420...................  Tractor, Wheeled.........  DCSC                
2510 P \2\.............  Vehicular Cab, Body, and   DCSC                
                          Frame, Structural                             
                          Components.                                   
2520 P \2\.............  Vehicular Power            DCSC                
                          Transmission Components.                      
2530 P \2\.............  Vehicular Brake,           DCSC                
                          Steering, Axle, Wheel,                        
                          and Track Components.                         
2540 P \2\.............  Vehicular Furniture and    DCSC                
                          Accessories.                                  
2590 P \2\.............  Miscellaneous Vehicular    DCSC                
                          Components.                                   
2805 P \2\.............  Gasoline Reciprocating     DCSC                
                          Engines, Except                               
                          Aircraft; and Components.                     
2815...................  Diesel Engines and         DCSC                
                          Components.                                   
2895...................  Miscellaneous Engines and  DCSC                
                          Components.                                   
2910 P \2\.............  Engine Fuel System         DCSC                
                          Components, Nonaircraft.                      
2920 P \2\.............  Engine Electrical System   DCSC                
                          Components, Nonaircraft.                      
2930 P \2\.............  Engine Cooling System      DCSC                
                          Components, Nonaircraft.                      
------------------------------------------------------------------------
NOTE: (``P'' after the FSC number indicates a                           
 partial FSC assignment)                                                
------------------------------------------------------------------------
2940 P \2\.............  Engine Air and Oil         DCSC                
                          Filters, Strainers and                        
                          Cleaners, Nonaircraft.                        
2990 P \2\.............  Miscellaneous Engine       DCSC                
                          Accessories, Nonaircraft.                     
3020...................  Gears, Pulleys, Sprockets  DCSC                
                          and Transmission Chain.                       
3030...................  Belting, Drive Belts, Fan  DCSC                
                          Belts, and Accessories.                       
3040...................  Miscellaneous Power        DCSC                
                          Transmission Equipment.                       
3110...................  Bearings, Antifriction,    DISC                
                          Unmounted.                                    
3120...................  Bearings, Plain Unmounted  DISC                
3130...................  Bearings, Mounted........  DISC                
3210...................  Sawmill and Planing Mill   DGSC                
                          Machinery.                                    
3220...................  Woodworking Machines.....  DGSC                
3230...................  Tools and Attachments for  DGSC                
                          Woodworking Machinery.                        
3405...................  Saws and Filing Machines.  DGSC                
3408...................  Machining Centers and Way- DGSC                
                          Type Machines.                                
3410...................  Electrical and Ultrasonic  DGSC                
                          Erosion Machines.                             
3411...................  Boring Machines..........  DGSC                
3412...................  Broaching Machines.......  DGSC                
3413...................  Drilling and Tapping       DGSC                
                          Machines.                                     
3414...................  Gear Cutting and           DGSC                
                          Finishing Machines.                           
3415...................  Grinding Machines........  DGSC                
3416...................  Lathes...................  DGSC                
3417...................  Milling Machines.........  DGSC                
3418...................  Planers and Shapers......  DGSC                
3419...................  Miscellaneous Machine      DGSC                
                          Tools.                                        
3422...................  Rolling Mills and Drawing  DGSC                
                          Machines.                                     
3424...................  Metal Heat Treating        DGSC                
                          Equipment.                                    
3426...................  Metal Finishing Equipment  DGSC                
3431...................  Electric Arc Welding       DGSC                
                          Equipment.                                    
3432...................  Electric Resistance        DGSC                
                          Welding Equipment.                            
3433...................  Gas Welding, Heat Cutting  DGSC                
                          & Metalizing Equipment.                       
3436...................  Welding Positioners and    DGSC                
                          Manipulators.                                 
3438...................  Miscellaneous Welding      DGSC                
                          Equipment.                                    
3439...................  Miscellaneous Welding,     DGSC                
                          Soldering and Brazing                         
                          Supplies and Accessories.                     
3441...................  Bending and Forming        DGSC                
                          Machines.                                     
3442...................  Hydraulic and Pneumatic    DGSC                
                          Presses, Power Driven.                        
3443...................  Mechanical Presses, Power  DGSC                
                          Driven.                                       
3444...................  Manual Presses...........  DGSC                
3445...................  Punching and Shearing      DGSC                
                          Machines.                                     

[[Page 593]]

                                                                        
3446...................  Forging Machinery and      DGSC                
                          Hammers.                                      
3447...................  Wire and Metal Ribbon      DGSC                
                          Forming Machinery.                            
3448...................  Riveting Machines........  DGSC                
3449...................  Misc. Secondary Metal      DGSC                
                          Forming and Cutting                           
                          Machines.                                     
3450...................  Machine Tools, Portable..  DGSC                
3455...................  Cutting Tools for Machine  DGSC                
                          Tools.                                        
3456...................  Cutting and Forming Tools  DGSC                
                          for Secondary Metal                           
                          Working Machines.                             
3460...................  Machine Tool Accessories.  DGSC                
3461...................  Accessories for Secondary  DGSC                
                          Metal Working Machinery.                      
3465...................  Production Jigs, Fixtures  DGSC                
                          and Templates.                                
3470...................  Machine Shop Sets, Kits,   DGSC                
                          and Outfits.                                  
3510...................  Laundry and Dry Cleaning   DGSC                
                          Equipment.                                    
3520...................  Shoe Repairing Equipment.  DGSC                
3530...................  Industrial Sewing          DGSC                
                          Machines & Mobile                             
                          Textile Repair Shops.                         
3610...................  Printing, Duplicating,     DGSC                
                          and Bookbinding                               
                          Equipment.                                    
3611 P \9\.............  Industrial Marking         DGSC                
                          Machines.                                     
3620 P \9\.............  Rubber and Plastics        DGSC                
                          Working Machinery.                            
3635 P \9\.............  Crystal and Glass          DGSC                
                          Industries Machinery.                         
3650 P \9\.............  Chemical & Pharmaceutical  DGSC                
                          Products Manufacturing                        
                          Machinery.                                    
3655...................  Gas Generating and         DGSC                
                          Dispensing Systems,                           
                          Fixed or Mobile.                              
3660 P \9\.............  Industrial Size Reduction  DGSC                
                          Machinery.                                    
3680 P \9\.............  Foundry Machinery,         DGSC                
                          Related Equipment and                         
                          Supplies.                                     
3685 P \9\.............  Specialized Metal          DGSC                
                          Container Manufacturing                       
                          Machinery and Related                         
                          Equipment.                                    
3693 P \9\.............  Industrial Assembly        DGSC                
                          Machines.                                     
3694 P \9\.............  Clean Work Stations,       DGSC                
                          Controlled Environment &                      
                          Related Equipment.                            
3695...................  Miscellaneous Special      DGSC                
                          Industry Machinery.                           
3710...................  Soil Preparation           DCSC                
                          Equipment.                                    
3720...................  Harvesting Equipment.....  DCSC                
3740...................  Pest, Disease, and Frost   DCSC                
                          Control Equipment.                            
3770...................  Saddlery, Harness, Whips   DCSC                
                          and Related Animal                            
                          Furnishings.                                  
3805...................  Earth Moving and           DCSC                
                          Excavating Equipment.                         
3810...................  Cranes and Crane-Shovels.  DCSC                
3815...................  Crane and Crane-Shovel     DCSC                
                          Attachments.                                  
3820...................  Mining, Rock Drilling,     DCSC                
                          Earth Boring, and                             
                          Related Equipment.                            
3825...................  Road Clearing and          DCSC                
                          Cleaning Equipment.                           
3830...................  Truck and Tractor          DCSC                
                          Attachments.                                  
3835...................  Petroleum Production and   DCSC                
                          Distribution Equipment.                       
3895...................  Miscellaneous              DCSC                
                          Construction Equipment.                       
3910...................  Conveyors................  DCSC                
3920...................  Materials Handling         DGSC                
                          Equipment, Nonself-                           
                          Propelled.                                    
3930...................  Warehouse Trucks and       DCSC                
                          Tractors, Self-Propelled.                     
3940...................  Blocks, Tackle, Rigging,   DISC                
                          and Slings.                                   
3950...................  Winches, Hoists, Cranes,   DCSC                
                          and Derricks.                                 
3990...................  Miscellaneous Materials    DGSC                
                          Handling Equipment.                           
4010...................  Chain and Wire Rope......  DISC                
4020...................  Fiber Rope, Cordage and    DISC                
                          Twine.                                        
4030...................  Fittings for Rope, Cable,  DISC                
                          and Chain.                                    
4110...................  Refrigeration Equipment..  DGSC                
4120...................  Air Conditioning           DGSC                
                          Equipment.                                    
4130...................  Refrigeration and Air      DGSC                
                          Conditioning Components.                      
4140...................  Fans, Air Circulators,     DGSC                
                          and Blower Equipment.                         
4210 P \3\.............  Fire Fighting Equipment..  DCSC                
4220...................  Marine Lifesaving and      DCSC                
                          Diving Equipment.                             
4310...................  Compressors and Vacuum     DCSC                
                          Pumps.                                        
4320...................  Power and Hand Pumps.....  DCSC                
4330...................  Centrifugals, Separators,  DCSC                
                          and Pressure and Vacuum                       
                          Filters.                                      
4440...................  Driers, Dehydrators, and   DCSC                
                          Anhydrators.                                  
4450...................  Industrial Fan and Blower  DCSC                
                          Equipment.                                    
4460...................  Air Purification           DCSC                
                          Equipment.                                    
4510...................  Plumbing Fixtures and      DCSC                
                          Accessories.                                  
4520...................  Space Heating Equipment    DCSC                
                          and Domestic Water                            
                          Heaters.                                      
4530...................  Fuel Burning Equipment     DCSC                
                          Units.                                        
4540...................  Miscellaneous Plumbing,    DCSC                
                          Heating, and Sanitation                       
                          Equipment.                                    
4610...................  Water Purification         DCSC                
                          Equipment.                                    
4620...................  Water Distillation         DCSC                
                          Equipment, Marine and                         
                          Industrial.                                   
4630...................  Sewage Treatment           DCSC                
                          Equipment.                                    
4710...................  Pipe and Tube............  DCSC                
4720...................  Hose and Tubing, Flexible  DCSC                
4730...................  Fittings and               DCSC                
                          Specialities; Hose,                           
                          Pipe, and Tube.                               
4810...................  Valves, Powered..........  DCSC                
4820...................  Valves, Nonpowered.......  DCSC                
4930...................  Lubrication and Fuel       DCSC                
                          Dispensing Equipment.                         
5280...................  Sets, Kits, and Outfits    DGSC                
                          of Measuring Tools.                           
5305...................  Screws...................  DISC                
5306...................  Bolts....................  DISC                
5307...................  Studs....................  DISC                
5310...................  Nuts and Washers.........  DISC                
5315...................  Nails, Keys, and Pins....  DISC                
5320...................  Rivets...................  DISC                
5325...................  Fastening Devices........  DISC                
5330...................  Packing and Gasket         DISC                
                          Materials.                                    
5335...................  Metal Screening..........  DISC                
5340...................  Miscellaneous Hardware...  DISC                
5355...................  Knobs and Pointers.......  DISC                
5360...................  Coil, Flat and Wire        DISC                
                          Springs.                                      
5365...................  Rings, Shims, and Spacers  DISC                
5410...................  Prefabricated and          DCSC                
                          Portable Buildings.                           

[[Page 594]]

                                                                        
5420...................  Bridges, Fixed and         DCSC                
                          Floating.                                     
5430...................  Storage Tanks............  DCSC                
5440...................  Scaffolding Equipment and  DCSC                
                          Concrete Forms.                               
5445...................  Prefabricated Tower        DCSC                
                          Structures.                                   
5450...................  Miscellaneous              DCSC                
                          Prefabricated Structures.                     
5510...................  Lumber and Related Basic   DCSC                
                          Wood Materials.                               
5520...................  Millwork.................  DCSC                
5530...................  Plywood and Veneer.......  DCSC                
5660...................  Fencing, Fences and Gates  DCSC                
5680 P.................  Miscellaneous              DCSC                
                          Construction Materials.                       
                         This partial assignment                        
                          applies only to airplane                      
                          landing mat. (Also, see                       
                          footnote 1 at end of                          
                          list relative to                              
                          purchase of DLA managed                       
                          items in GSA assigned                         
                          classes.).                                    
5905...................  Resistors................  DESC                
5910...................  Capacitors...............  DESC                
5915...................  Filters and Networks.....  DESC                
5920...................  Fuses and Lightning        DESC                
                          Arrestors.                                    
5925...................  Circuit Breakers.........  DESC                
5930...................  Switches.................  DESC                
5935...................  Connectors, Electrical...  DESC                
5940...................  Lugs, Terminals, and       DGSC                
                          Terminals Strips.                             
5945...................  Relays, Contractors, and   DESC                
                          Solenoids.                                    
5950...................  Coils and Transformers...  DESC                
5955...................  Piezoelectric Crystals...  DESC                
5960...................  Electron Tubes and         DESC                
                          Associated Hardware.                          
5961...................  Semiconductor Devices and  DESC                
                          Associated Hardware.                          
5962...................  Microelectronic Circuit    DESC                
                          Devices.                                      
5965...................  Headsets, Handsets,        DESC                
                          Microphones, and                              
                          Speakers.                                     
5970...................  Electrical Insulators and  DGSC                
                          Insulating Materials.                         
5975...................  Electrical Hardware and    DGSC                
                          Supplies.                                     
5977...................  Electrical Contact         DGSC                
                          Brushes and Electrodes.                       
5985...................  Antennas, Waveguides, and  DESC                
                          Related Equipment.                            
5990...................  Synchros and Resolvers...  DESC                
5995...................  Cable, Cord, and Wire      DGSC                
                          Assemblies;                                   
                          Communication Equipment.                      
5999...................  Miscellaneous Electrical   DESC                
                          and Electronic                                
                          Components.                                   
6105...................  Motors, Electrical.......  DGSC                
6110...................  Electrical Control         DGSC                
                          Equipment.                                    
6115 P \8\.............  Generators and Generator   DGSC                
                          Sets, Electrical.                             
6120...................  Transformers;              DGSC                
                          Distribution and Power                        
                          Station.                                      
6145...................  Wire and Cable,            DISC                
                          Electrical.                                   
6150...................  Miscellaneous Electric     DGSC                
                          Power and Distribution                        
                          Equipment.                                    
6210...................  Indoor and Outdoor         DGSC                
                          Electric Lighting                             
                          Fixtures.                                     
6220...................  Electric Vehicular Lights  DGSC                
                          and Fixtures.                                 
6230...................  Electric Portable and      DGSC                
                          Hand Lighting Equipment.                      
6240...................  Electric Lamps...........  DGSC                
6250...................  Ballasts, Lampholders and  DGSC                
                          Starters.                                     
6260...................  Nonelectrical Lighting     DGSC                
                          Fixtures.                                     
6350...................  Miscellaneous Alarm and    DGSC                
                          Signal Systems.                               
6505 \4\...............  Drugs, Biologicals, and    DPSC                
                          Official Reagents.                            
6508 \4\...............  Medicated Cosmetics and    DPSC                
                          Toiletries.                                   
6510 \4\...............  Surgical Dressing          DPSC                
                          Materials.                                    
6515 \4\...............  Medical and Surgical       DPSC                
                          Instruments, Equipment                        
                          and Supplies.                                 
6520 \4\...............  Dental Instruments,        DPSC                
                          Equipment and Supplies.                       
6525 \4\...............  X-Ray Equipment and        DPSC                
                          Supplies; Medical,                            
                          Dental and Veterinary.                        
6530 \4\...............  Hospital Furniture,        DPSC                
                          Equipment, Utensils, and                      
                          Supplies.                                     
6532...................  Hospital and Surgical      DPSC                
                          Clothing and Textile                          
                          Special Purpose Items.                        
6540 \4\...............  Opticians' Instruments,    DPSC                
                          Equipment and Supplies.                       
6545 \4\...............  Medical Sets, Kits, and    DPSC                
                          Outfits.                                      
6630...................  Chemical Analysis          DPSC                
                          Instruments.                                  
6635...................  Physical Properties        DGSC                
                          Testing Equipment.                            
6640...................  Laboratory Equipment and   DPSC                
                          Supplies.                                     
6655...................  Geophysical and            DGSC                
                          Astronomical Instruments.                     
6670...................  Scales and Balances......  DGSC                
6675...................  Drafting, Surveying, and   DGSC                
                          Mapping Instruments.                          
6680...................  Liquid and Gas Flow,       DGSC                
                          Liquid Level and                              
                          Mechanical Motion                             
                          Measuring Instruments.                        
6750...................  Photographic Supplies....  DGSC                
6810 \7\...............  Chemicals................  DFSC & DGSC         
6820...................  Dyes.....................  DGSC                
6830...................  Gases; Compressed and      DGSC                
                          Liquified.                                    
6840...................  Pest Control Agents and    DGSC                
                          Disinfectants.                                
6850 \7\...............  Miscellaneous Chemical     DFSC & DGSC         
                          Specialties.                                  
7210...................  Household Furnishings....  DPSC                
7310...................  Food Cooking, Baking, and  DGSC                
                          Serving Equipment.                            
7320...................  Kitchen Equipment and      DGSC                
                          Appliances.                                   
7360...................  Sets, Kits, and Outfits;   DGSC                
                          Food Preparation and                          
                          Serving.                                      
7610...................  Books and Pamphlets......  DGSC                
7660...................  Sheet and Book Music.....  DGSC                
7690...................  Miscellaneous Printed      DGSC                
                          Matter.                                       
8110...................  Drums and Cans...........  DGSC                
8120...................  Commercial and Industrial  DGSC                
                          Gas Cylinders.                                
8125...................  Bottles and Jars.........  DGSC                
8305...................  Textile Fabrics..........                      
                         FSC 8305 does not include  DPSC                
                          laminated cloth used                          
                          exclusively in the                            
                          repair of lighter than                        
                          air envelopes.                                
8310...................  Yarn and Thread..........  DPSC                
8315...................  Notions and Apparel                            
                          Findings.                                     

[[Page 595]]

                                                                        
                         FSC 8315 does not include  DPSC                
                          coated cloth tape used                        
                          exclusively in the                            
                          repair of lighter than                        
                          air envelopes.                                
8320...................  Padding and Stuffing       DPSC                
                          Materials.                                    
8325...................  Fur Materials............  DPSC                
8330...................  Leather..................  DPSC                
8335...................  Shoe Findings and Soling   DPSC                
                          Materials.                                    
8340...................  Tents and Tarpaulins.....  DPSC                
8345...................  Flags and Pennants.......  DPSC                
8405...................  Outerwear, Men's.........  DPSC                
8410...................  Outerwear, Women's.......  DPSC                
8415...................  Clothing, Special Purpose                      
                         FSC 8415 includes all      DPSC                
                          submarine clothing.                           
8420...................  Underwear and Nightwear,   DPSC                
                          Men's.                                        
8425...................  Underwear and Nightwear,   DPSC                
                          Women's.                                      
8430...................  Footwear, Men's..........  DPSC                
8435...................  Footwear, Women's........  DPSC                
8440...................  Hosiery, Handwear, and     DPSC                
                          Clothing Accessories,                         
                          Men's.                                        
8445...................  Hosiery, Handwear, and     DPSC                
                          Clothing Accessories,                         
                          Women's.                                      
8450...................  Children's and Infant's    DPSC                
                          Apparel and Accessories.                      
8455...................  Badges and Insignia......  DPSC                
8460...................  Luggage..................  DPSC                
8465...................  Individual Equipment.....  DPSC                
8470...................  Armor, Personal..........  DPSC                
8475...................  Specialized Flight         DPSC                
                          Clothing and Accessories.                     
8905 \5\...............  Meat, Poultry, and Fish..  DPSC                
8910 \5\...............  Dairy Foods and Eggs.....  DPSC                
8915 \5\...............  Fruits and Vegetables....  DPSC                
8920 \5\...............  Bakery and Cereal          DPSC                
                          Products.                                     
8925 \5\...............  Sugar, Confectionery, and  DPSC                
                          Nuts.                                         
8930 \5\...............  Jams, Jellies, and         DPSC                
                          Preserves.                                    
8935 \5\...............  Soups and Bouillons......  DPSC                
8940 \5\...............  Special Dietary Foods and  DPSC                
                          Food Specialty                                
                          Preparations.                                 
8945 \5\...............  Food Oils and Fats.......  DPSC                
8950 \5\...............  Condiments and Related     DPSC                
                          Products.                                     
8955 \5\...............  Coffee, Tea, and Cocoa...  DPSC                
8960 \5\...............  Beverages, Nonalcoholic..  DPSC                
8970 \5\...............  Composite Food Packages..  DPSC                
8975 \5\...............  Tobacco Products.........  DPSC                
9110...................  Fuels, Solid.............  DFSC                
9130...................  Liquid Propellants and     DFSC                
                          Fuels, Petroleum Base.                        
9140...................  Fuel Oils................  DFSC                
9150...................  Oils and Greases;          DFSC                
                          Cutting, Lubricating,                         
                          and Hydraulic.                                
9160...................  Miscellaneous Waxes,       DFSC                
                          Oils, and Fats.                               
9320...................  Rubber Fabricated          DGSC                
                          Materials.                                    
9330...................  Plastic Fabricated         DGSC                
                          Materials.                                    
9340...................  Glass Fabricated           DGSC                
                          Materials.                                    
9350...................  Refractories and Fire      DGSC                
                          Surfacing Materials.                          
9390...................  Miscellaneous Fabricated   DGSC                
                          Nonmetallic Materials.                        
9420 P.................  Fibers; Vegetable,         DPSC                
                          Animal, and Synthetic.                        
                         This partial FSC                               
                          assignment applies only                       
                          to raw cotton and raw                         
                          wool.                                         
9430 P.................  Miscellaneous Crude        DPSC                
                          Animal Products,                              
                          Inedible.                                     
                         This partial assignment                        
                          applies only to crude                         
                          hides.                                        
9505...................  Wire, Nonelectrical, Iron  DISC                
                          and Steel.                                    
9510...................  Bars and Rods, Iron and    DISC                
                          Steel.                                        
9515...................  Plate, Sheet, and Strip,   DISC                
                          Iron and Steel.                               
9520...................  Structural Shapes, Iron    DISC                
                          and Steel.                                    
9525...................  Wire, Nonelectrical,       DISC                
                          Nonferrous Base Metal.                        
9530...................  Bars and Rods, Nonferrous  DISC                
                          Base Metal.                                   
9535...................  Plate, Sheet, Strip, and   DISC                
                          Foil, Nonferrous Base                         
                          Metal.                                        
9540...................  Structural Shapes,         DISC                
                          Nonferrous Base Metal.                        
9545...................  Plate, Sheet, Strip, Foil  DISC                
                          and Wire, Precious Metal.                     
9620 P.................  Minerals, Natural and      DFSC                
                          Synthetic.                                    
                         This partial assignment                        
                          applies only to crude                         
                          petroleum and crude                           
                          shale oil.                                    
9925...................  Ecclesiastical Equipment,  DGSC                
                          Furnishings and Supplies.                     
9930...................  Memorials, Cemeterial and  DGSC                
                          Mortuary Equipment and                        
                          Supplies.                                     
9999...................  Miscellaneous Items......  DGSC                
------------------------------------------------------------------------
Footnotes:                                                              
\1\ These assignments do not apply to items decentralized by the DLA    
  Center Commander, i.e., designated for purchase by each military      
  department, and to those items in DLA assigned federal supply classes,
  which may be assigned to GSA for supply management. In addition, see  
  subpart 208.70 which describes conditions under which a military      
  service may purchase (contract for) military service supply managed   
  items in DLA assigned federal supply classes. See notes 2 and 3 for   
  further exceptions pertaining to certain DLA assignments.             
\2\ DLA assignments in FSC 2510, 2520, 2530, 2540, 2590, 2805, 2910,    
  2920, 2930, 2940, and 2990 do not apply to repair parts peculiar to   
  combat and tactical vehicles, which are assigned for coordinated      
  acquisition to the Department of the Army. In addition, the assignment
  in FSC 2805 does not apply to military standard engines 1.5 HP through
  20 HP and parts peculiar therefor, which are assigned for coordinated 
  acquisition to the Department of the Army.                            
\3\ This partial FSC assignment in FSC 4210 does not apply to Fire      
  Fighting Equipment developed by or under the sponsorship of a military
  department. The contracting responsibility for such equipment is      
  assigned to the department which developed or sponsored its           
  development.                                                          
\4\ DLA has contracting responsibility for all the items in the classes 
  of FS Group 65. In addition, DLA has contracting responsibility for   
  all equipment and supplies related to the medical, dental, veterinary 
  professions in Non-group 65 classes where the military medical        
  services have the sole or prime interest in such items. The specific  
  item coverage of these Non-group 65 items is published in the DoD     
  section of the Federal Supply Catalog for medical material C3-1       
  through C3-12, inclusive.                                             
\5\ This assignment includes health and comfort items listed in AR 700- 
  23. It also includes resale items for commissary stores (including    
  brand name items).                                                    
\6\ DLA centers are identified as follows--DCSC--Defense Construction   
  Supply Center; DESC--Defense Electronics Supply Center; DFSC--Defense 
  Fuel Supply Center; DGSC--Defense General Supply Center; DISC--Defense
  Industrial Supply Center; DPSC--Defense Personnel Support Center.     
\7\ DFSC is responsible for contracting for only petroleum base items in
  FSC 6810 and 6850.                                                    

[[Page 596]]

                                                                        
\8\ This partial FSC assignment in FSC 6115 does not apply to Mobile    
  Electric Power Generating Sources (MEPGS). The contracting direction  
  responsibility for MEPGS is assigned to the DoD Project Manager,      
  Mobile Electric Power, by DoDD 4120.11. DoD components desiring to use
  other than the DoD Standard Family of Generator Sets, contained in MIL-
  STD 633, shall process a Request for Deviation in accordance with     
  Joint Operating Procedures, AR 700-101, AFR 400-50, NAVMATINST        
  4120.100A, MCO 11310.8c and DLAR 4120.7, Subject: Management and      
  Standardization of Mobile Electric Power Generating Sources, prior to 
  initiating an acquisition.                                            
\9\ This partial assignment applies only to secondary items not         
  otherwise assigned, as listed in the applicable Federal Supply Catalog
  Management Data lists of each respective service.                     



           Part 5--Defense Special Weapons Agency Assignments

                                                                        
------------------------------------------------------------------------
     Federal supply class code                    Commodity             
------------------------------------------------------------------------
1105..............................  Nuclear Bombs.                      
1110..............................  Nuclear Projectiles.                
1115..............................  Nuclear Warheads and Warhead        
                                     Sections.                          
1125..............................  Nuclear Demolition Charges.         
1127..............................  Nuclear Rockets.                    
1130..............................  Conversion Kits, Nuclear Ordnance.  
1135..............................  Fuzing and Firing Devices, Nuclear  
                                     Ordnance.                          
1140..............................  Nuclear Components.                 
1145..............................  High Explosive Charges, Propellants,
                                     and Detonators; Nuclear Ordnance.  
1190..............................  Specialized Test and Handling       
                                     Equipment, Nuclear Ordnance.       
1195..............................  Miscellaneous Nuclear Ordnance.     
                                    In addition to the above,           
                                     assignments to DSWA include all    
                                     items for which DSWA has integrated
                                     management responsibility in       
                                     accordance with DoD Directive      
                                     5105.31.                           
------------------------------------------------------------------------

           Part 6--General Services Administration Assignments

                                                                        
------------------------------------------------------------------------
     Federal supply class code                    Commodity             
------------------------------------------------------------------------
2310 P............................  Passenger Motor Vehicles.           
2320 P............................  Trucks and Truck Tractors.          
                                    These two partial assignments apply 
                                     to all commercial, non-tactical,   
                                     passenger carrying vehicles and    
                                     trucks except the following types  
                                     which are assigned for DoD         
                                     Coordinated Acquisition to the     
                                     Department of the Army--           
                                      Bus, convertible to ambulance.    
                                      Truck, 4 x 4, convertible to      
                                     ambulance.                         
                                      Truck, 4 x 4, dump, 9,000 pounds  
                                     GVW, with cut-down cab.            
                                    (See Army Coordinated Acquisition   
                                     assignments in FSC 2310 and 2320). 
3540..............................  Wrapping and Packaging Machinery.   
3550..............................  Vending and Coin Operated Machines. 
3590..............................  Miscellaneous Service and Trade     
                                     Equipment.                         
3750..............................  Gardening Implements and Tools.     
5110..............................  Hand Tools, Edged, Nonpowered.      
5120..............................  Hand Tools, Nonedged, Nonpowered.   
5130..............................  Hand Tools, Power Driven.           
5133..............................  Drill Bits, Counterbores, and       
                                     Countersinks; Hand and Machine.    
5136..............................  Taps, Dies, and Collects; Hand and  
                                     Machine.                           
5140..............................  Tool and Hardware Boxes.            
5180..............................  Sets, Kits, and Outfits of Hand     
                                     Tools.                             
5210..............................  Measuring Tools, Craftmen's.        
5345..............................  Disks and Stones, Abrasive.         
5350..............................  Abrasive Materials.                 
5610..............................  Mineral Construction Materials,     
                                     Bulk.                              
5620..............................  Building Glass, Tile, Brick, and    
                                     Block.                             
5630..............................  Pipe and Conduit, Nonmetallic.      
5640..............................  Wallboard, Building Paper, and      
                                     Thermal Insulation Materials.      
5650..............................  Roofing and Siding Materials.       
5670..............................  Architectural and Related Metal     
                                     Products.                          
5680 P\1\.........................  Miscellaneous Construction          
                                     Materials.                         
7105..............................  Household Furniture.                
7110..............................  Office Furniture.                   
7125..............................  Cabinets, Lockers, Bins, and        
                                     Shelving.                          
7195..............................  Miscellaneous Furniture and         
                                     Fixtures.                          
7220..............................  Floor Coverings.                    
7230..............................  Draperies, Awnings, and Shades.     
7240..............................  Household and Commercial Utility    
                                     Containers.                        
------------------------------------------------------------------------
NOTE: (``P'' after FSC number indicates partial FSC assignment.)        
-----------------------------------                                     
7290..............................  Miscellaneous Household and         
                                     Commercial Furnishings and         
                                     Appliances.                        
7330..............................  Kitchen Hand Tools and Utensils.    
7340..............................  Cutlery and Flatware.               
7350..............................  Tableware.                          
7410..............................  Punched Card System Machines.       
7420..............................  Accounting and Calculating Machines.
7430..............................  Typewriters and Office-type         
                                     Composing Machines.                
                                    This assignment does not apply to   
                                     machines controlled by the         
                                     Congressional Joint Committee on   
                                     Printing.                          
7450..............................  Office-type Sound Recording and     
                                     Reproducing Machines.              
7460..............................  Visible Record Equipment.           
7490..............................  Miscellaneous Office Machines.      
                                    This assignment does not apply to   
                                     equipment controlled by the        
                                     Congressional Joint Committee on   
                                     Printing.                          
7510..............................  Office Supplies.                    
                                    This assignment does not apply to   
                                     office supplies, including special 
                                     inks, when DoD requirements of such
                                     items are acquired through         
                                     Government Printing Office         
                                     channels.                          
7520..............................  Office Devices and Accessories.     
                                    This assignment does not apply to   
                                     office devices and accessories when
                                     DoD requirements of such items are 
                                     acquired through Government        
                                     Printing Office channels.          
7530..............................  Stationery and Record Forms.        
                                    This assignment does not apply to   
                                     stationery and record forms when   
                                     DoD requirements of such items are 
                                     acquired through Government        
                                     Printing Office channels including 
                                     those items covered by term        
                                     contracts issued by GPO for        
                                     tabulating cards and marginally    
                                     punched continuous forms.          
7710..............................  Musical Instruments.                
7720..............................  Musical Instrument Parts and        
                                     Accessories.                       
7730..............................  Phonographs, Radios, and Television 
                                     Sets; Home Type.                   
7740..............................  Phonograph Records.                 
7810..............................  Athletic and Sporting Equipment.    
7820..............................  Games, Toys, and Wheeled Goods.     
7830..............................  Recreational and Gymnastic          
                                     Equipment.                         
7910..............................  Floor Polishers and Vacuum Cleaning 
                                     Equipment.                         
7920..............................  Brooms, Brushes, Mops, and Sponges. 
7930..............................  Cleaning and Polishing Compounds and
                                     Preparations.                      

[[Page 597]]

                                                                        
8010..............................  Paints, Dopes, Varnishes, and       
                                     Related Products.                  
8020..............................  Paint and Artists Brushes.          
8030..............................  Preservative and Sealing Compounds. 
8040..............................  Adhesives.                          
8105..............................  Bags and Sacks.                     
8115..............................  Boxes, Cartons and Crates.          
8135..............................  Packaging and Packing Bulk          
                                     Materials.                         
8510..............................  Perfumes, Toilet Preparations and   
                                     Powders.                           
8520..............................  Toilet Soap, Shaving Preparations   
                                     and Dentifrices.                   
8530..............................  Personal Toiletry Articles.         
8540..............................  Toiletry Paper Products.            
8710..............................  Forage and Feed.                    
8720..............................  Fertilizers.                        
8730..............................  Seeds and Nursery Stock.            
9310..............................  Paper and Paperboard.               
9905..............................  Signs, Advertising Displays, and    
                                     Identification Plates.             
9910..............................  Jewelry.                            
9915..............................  Collector's Items.                  
9920..............................  Smokers' Articles and Matches.      
------------------------------------------------------------------------
Footnotes: These GSA assignments do not apply to items as described     
  under FSC 7430, 7490, 7510, 7520, and 7530, and those items in the GSA
  assigned federal supply classes which have been retained for DLA      
  supply management as listed in the applicable Federal Supply Catalog  
  Management Data lists. In addition, see subpart 208.70 which describes
  conditions under which a military service may contract for military   
  service managed items in GSA assigned federal supply classes.         
\1\ This partial FSC assignment does not include landing mats which are 
  assigned to the Defense Logistics Agency.                             

[56 FR 36577, July 31, 1991, as amended at 57 FR 42634, Sept. 15, 1992; 
58 FR 28475, May 13, 1993; 58 FR 37868, July 14, 1993; 59 FR 27678, May 
27, 1994; 61 FR 50456, Sept. 26, 1996]

                          Appendix C [Reserved]

                     Appendix D--Component Breakout

Sec.
D-100  Scope.
D-101  Definition.
D-102  Policy.
D-103  Responsibility.
D-104  Procedures.
D-105  Records.

    Authority; 41 U.S.C. 421 and FAR Subpart 1.3.

                              D-100  Scope.

    (a) This appendix provides policy and procedures for breaking out 
components of end items for future acquisitions so that the Government 
can purchase the components directly from the manufacturer or supplier 
and furnish them to the end item manufacturer as Government-furnished 
material.
    (b) This appendix does not apply to--
    (1) The initial decisions on Government-furnished equipment/
contractor-furnished equipment that are made at the inception of an 
acquisition program; or
    (2) Breakout of parts for replenishment (see Appendix E).

                           D-101  Definition.

    Component, as used in this appendix, includes subsystems, 
assemblies, subassemblies, and other major elements of an end item; it 
does not include elements of relatively small annual acquisition value.

                             D-102  Policy.

    DoD policy is to breakout components of weapons systems or other 
major end items under certain circumstances.
    (a) When it is anticipated that a prime contract will be awarded 
without adequate price competition, and the prime contractor is expected 
to acquire any component without adequate price competition, breakout 
that component if--
    (1) Substantial net cost savings probably will be achieved; and
    (2) Breakout action will not jeopardize the quality, reliability, 
performance, or timely delivery of the end item.
    (b) Even when either or both the prime contract and the component 
will be acquired with adequate price competition, consider breakout of 
the component if substantial net cost savings will result from--
    (1) Greater quantity acquisitions; or
    (2) Such factors as improved logistics support (through reduction in 
varieties of spare parts) and economies in operations and training 
(through standardization of design).
    (c) Breakout normally is not justified for a component that is not 
expected to exceed $1 million for the current year's requirement.

                         D-103  Responsibility.

    (a) Agencies are responsible for ensuring that--
    (1) Breakout reviews are performed on components meeting the 
criteria in D-102(a) and (b);
    (2) Components susceptible to breakout are earmarked for 
consideration in future acquisitions;
    (3) Components earmarked for breakout are considered during 
requirements determination and appropriate decisions are made; and
    (4) Components are broken out when required.
    (b) The program manager or other official responsible for the 
material program concerned is responsible for breakout selection, 
review, and decision.
    (c) The contracting officer or buyer and other specialists (e.g., 
small business specialist, engineering, production, logistics, and 
maintenance) support the program manager in implementing the breakout 
program.

                           D-104  Procedures.

    (a) A breakout review and decision includes--

[[Page 598]]

    (1) An assessment of the potential risks to the end item from 
possibilities such as delayed delivery and reduced reliability of the 
component;
    (2) A calculation of estimated net cost savings (i.e., estimated 
acquisition savings less any offsetting costs); and
    (3) An analysis of the technical, operational, logistics, and 
administrative factors involved.
    (b) The decision must be supported by adequate explanatory 
information, including an assessment by the end item contractor when 
feasible.
    (c) The following questions should be used in the decision process--
    (1) Is the end item contractor likely to do further design or 
engineering effort on the component?
    (2) Is a suitable data package available with rights to use it for 
Government acquisition? (Note that breakout may be warranted even though 
competitive acquisition is not possible.)
    (3) Can any quality control and reliability problems of the 
component be resolved without requiring effort by the end item 
contractor?
    (4) Will the component require further technical support (e.g., 
development of specifications, testing requirements, or quality 
assurance requirements)? If so, does the Government have the resources 
(manpower, technical competence, facilities, etc.) to provide such 
support? Or, can the support be obtained from the end item contractor 
(even though the component is broken out) or other source?
    (5) Will breakout impair logistics support (e.g., by jeopardizing 
standardization of components)?
    (6) Will breakout unduly fragment administration, management, or 
performance of the end item contract (e.g., by complicating production 
scheduling or preventing identification of responsibility for end item 
failure caused by a defective component)?
    (7) Can breakout be accomplished without jeopardizing delivery 
requirements of the end item?
    (8) If a decision is made to breakout a component, can advance 
acquisition funds be made available to provide the new source any 
necessary additional lead time?
    (9) Is there a source other than the present manufacturer capable of 
supplying the component?
    (10) Has the component been (or is it going to be) acquired directly 
by the Government as a support item in the supply system or as 
Government-furnished equipment in other end items?
    (11) Will the financial risks and other responsibilities assumed by 
the Government after breakout be acceptable?
    (12) Will breakout result in substantial net cost savings? Develop 
estimates of probable savings in cost considering all offsetting costs 
such as increases in the cost of requirements determination and control, 
contracting, contract administration, data package purchase, material 
inspection, qualification or preproduction testing, ground support and 
test equipment, transportation, security, storage, distribution, and 
technical support.
    (d) If answers to the questions reveal conditions unfavorable to 
breakout, the program manager should explore whether the unfavorable 
conditions can be eliminated. For example, where adequate technical 
support is not available from Government resources, consider contracting 
for the necessary services from the end item contractor or other 
qualified source.

                             D-105  Records.

    (a) The contracting activity shall maintain records on components 
reviewed for breakout. Records should evidence whether the components--
    (1) Have no potential for breakout;
    (2) Have been earmarked as potential breakout candidates;
    (3) Have been, or will be, broken out.
    (b) The program manager or other designated official must sign the 
records.
    (c) Records must reflect the facts and conditions of the case, 
including any assessment by the contractor, and the basis for the 
decision. The records must contain the assessments, calculations, and 
analyses discussed in D-104, including the trade-off analysis between 
savings and increased risk to the Government because of responsibility 
for Government-furnished equipment.
[56 FR 36594, July 31, 1991, as amended at 57 FR 42634, Sept. 15, 1992; 
58 FR 37868, July 14, 1993]

              Appendix E--DOD Spare Parts Breakout Program

Sec.

                             Part 1--General

E-100  Scope.
E-101  Applicability.
E-102  General.
E-103  Definitions.
    E-103.1  Acquisition Method Code (AMC).
    E-103.2  Acquisition Method Code Conference.
    E-103.3  Acquisition Method Suffix Code (AMSC).
    E-103.4  Actual Manufacturer.
    E-103.5  Altered Item Drawing.
    E-103.6  Annual Buy Quantity.
    E-103.7  Annual Buy Value (ABV).
    E-103.8  Bailment.
    E-103.9  Breakout.
    E-103.10  Competition.
    E-103.11  Contractor Technical Information Code (CTIC).

[[Page 599]]

    E-103.12  Design Control Activity.
    E-103.13  Direct Purchase.
    E-103.14  Engineering Drawings.
    E-103.15  Extended Dollar Value.
    E-103.16  Full and Open Competition.
    E-103.17  Full Screening.
    E-103.18  Immediate (Live) Buy.
    E-103.19  Life Cycle Buy Value.
    E-103.20  Limited Competition.
    E-103.21  Limited Screening.
    E-103.22  Manufacture.
    E-103.23  Prime Contractor.
    E-103.24  Provisioning.
    E-103.25  Qualification.
    E-103.26  Replenishment Part.
    E-103.27  Reverse Engineering.
    E-103.28  Selected Item Drawing.
    E-103.29  Source.
    E-103.30  Source Approval.
    E-103.31  Source Control Drawing.
    E-103.32  Technical Data.
E-104  General Policies.
E-105  Responsibilities.

                         Part 2--Breakout Coding

E-200  Scope.
E-201  Coding.
    E-201.1  Acquisition Method Codes.
    E-201.2  Acquisition Method Suffix Codes.
    E-201.3  Contractor Technical Information Codes.
E-202  Assignment of Codes.
E-203  Improving Part Status.
E-204  Communication of Codes.
    E-204.1  Communication Media.
    E-204.2  Responsibilities.

        Part 3--Identification, Selection, and Screening of Parts

E-300  General.
E-301  Identification and Selection Procedures.
    E-301.1  Parts Entering the Inventory.
    E-301.2  Annual Buy Forecasts.
    E-301.3  Immediate Buy Requirements.
    E-301.4  Suspect AMC/AMSC.
E-302  Screening.
E-303  Full Screening Procedures.
    E-303.1  Data Collection Phase (Step 1).
    E-303.2  Data Evaluation Phase (Steps 2-14).
    E-303.3  Data Completion Phase (Steps 15-21).
    E-303.4  Technical Evaluation Phase (Steps 22-37).
    E-303.5  Economic Evaluation Phase (Steps 38-56).
    E-303.6  Supply Feedback Phase (Steps 57-65).
E-304  Limited Screening Procedures.

                     Part 4--Contractor's Assistance

E-400  General.
E-401  Contractor's Technical Evaluation Procedures.

                        Part 5--Reporting System

E-500  General.
E-501  Reports.
E-502  Reporting Procedures.
E-503  Reporting Instructions.

                                Exhibits

Exhibit I Valid AMC/AMSC Combinations
Exhibit II Full Screening Decision Process Summary Flow Charts
Exhibit III Limited Screening Decision Process Summary Flow Charts
Exhibit IV Spare Parts Breakout Screening Report
Exhibit V Spare Parts Acquisition Report

    Authority; 41 U.S.C. 421 and 48 CFR chapter 1.

                             Part 1--General

E-100  Scope.
    This appendix established the DoD Spare Parts Breakout Program and 
provides uniform policies and procedures for management and conduct of 
the program within and between the departments and agencies.
E-101  Applicability.
    (a) This appendix applies to--
    (1) Any centrally managed replenishment or provisioned part 
(hereinafter referred to as ``part'') for military systems and 
equipment; and
    (2) All DoD personnel involved with design control, acquisition, and 
management of such parts including, but not limited to, project/program/
system managers, technical personnel, contracting officers, legal 
counsel, inventory managers, inspectors, and small business specialists 
and technical advisors.
    (b) This appendix does not apply to--
    (1) Component breakout (see Appendix D);
    (2) Foreign military sale peculiar items;
    (3) Insurance items (e.g., one-time buy);
    (4) Obsolete items;
    (5) Phase out items (e.g., life of type buy);
    (6) Items with annual buy values below the thresholds developed by 
DoD components or field activities;
    (7) Parts being acquired under other specifically defined initial 
support programs; or
    (8) Parts acquired through local purchase.
E-102  General.
    (a) Significant resources are dedicated to the acquisition and 
management of parts for military systems and equipment. The ability to 
competitively buy spares must be considered early in a weapon system 
acquisition. Initially, repairable or consumable parts are identified 
and acquired through a provisioning process; repairable or consumable 
parts acquired thereafter are for replenishment.
    (b) The objective of the DoD Spare Parts Breakout Program is to 
reduce costs through

[[Page 600]]

the use of competitive procurement methods, or the purchase of parts 
directly from the actual manufacturer rather than the prime contractor, 
while maintaining the integrity of the systems and equipment in which 
the parts are to be used. The program is based on the application of 
sound management and engineering judgement in--
    (1) Determining the feasibility of acquiring parts by competitive 
procedures or direct purchase from actual manufacturers; and
    (2) Overcoming or removing constraints to breakout identified 
through the screening process (technical review) described in E-302.
    (c) This Appendix sets forth procedures to screen and code parts in 
order to provide contracting officers summary information regarding 
technical data and sources of supply to meet the Government's minimum 
requirements. This information assists the contracting officer in 
selecting the method of contracting, identifying sources of supply, and 
making other decisions in the preaward and award phases, with 
consideration for established parameters of system and equipment 
integrity, readiness, and the opportunities to competitively acquire 
parts (see FAR/DFARS Part 6). The identification of sources for parts, 
for example, requires knowledge of manufacturing sources, additional 
operations performed after manufacture of parts possessing safety or 
other critical characteristics, and the availability of technical data.
    (d) The result of the screening process (technical review is 
indicated by an acquisition method code (AMC) and an acquisition method 
suffix code (AMSC). This program provides procedures for both the 
initial assignment of an AMC and an AMSC to a part, and for the 
recurring review of these codes (see E-202 and E-203(b)(1)).
E-103  Definitions.
E-103.1  Acquisition method code (AMC).
    A single digit numeric code, assigned by a DoD activity, to describe 
to the contracting officer and other Government personnel the results of 
a technical review of a part and its suitability for breakout.
E-103.2  Acquisition method code conference.
    A conference which is generally held at the contractor's facility 
for the purpose of reviewing contractor technical information codes 
(CTICs) and corresponding substantiating data for breakout.
E-103.3emsp;Acquisition method suffix code (AMSC).
    A single digit alpha code, assigned by a DoD activity, which 
provides the contracting officer and other Government personnel with 
engineering, manufacturing, and technical information.
E-103.4  Actual manufacturer.
    An individual, activity, or organization that performs the physical 
fabrication processes that produce the deliverable part or other items 
of supply for the Government. The actual manufacturer must produce the 
part in-house. The actual manufacturer may or may not be the design 
control activity.
E-103.5  Altered item drawing.
    See current version of DoD STD-100, paragraphs 201.4.4 and 703.
E-103.6  Annual buy quantity.
    The forecast quantity of a part required for the next 12 months.
E-103.7  Annual buy value (ABV).
    The annual buy quantity of a part multiplied by its unit price.
E-103.8  Bailment.
    The process whereby a part is loaned to a recipient with the 
agreement that the part will be returned at an appointed time. The 
government retains legal title to such material even though the 
borrowing organization has possession during the stated period.
E-103.9  Breakout.
    The improvement of the acquisition status of a part resulting from a 
technical review and a deliberate management decision. Examples are--
    (a) The competitive acquisition of a part previously purchased 
noncompetitively; and
    (b) The direct purchase of a part previously purchased from a prime 
contractor who is not the actual manufacturer of the part.
E-103.10  Competition.
    A contract action where two or more responsible sources, acting 
independently, can be solicited to satisfy the Government's requirement.
E-103.11  Contractor technical information code (CTIC).
    A two digit alpha code assigned to a part by a prime contractor to 
furnish specific information regarding the engineering, manufacturing, 
and technical aspects of that part.
E-103.12  Design control activity.
    A contractor or Government activity having responsibility for the 
design of a given part, and for the preparation and currency of 
engineering drawings and other technical data for that part. The design 
control activity may or may not be the actual manufacturer. The design 
control activity is synonymous with design activity as used by DoD STD-
100.

[[Page 601]]

E-103.13  Direct purchase.
    The acquisition of a part from the actual manufacturer, including a 
prime contractor who is an actual manufacturer of the part.
E-103.14  Engineering drawings.
    See current versions of DoD STD-100 and DoDD 1000.
E-103.15  Extended dollar value.
    The contract unit price of a part multiplied by the quantity 
purchased.
E-103.16  Full and open competition.
    A contract action where all responsible sources are permitted to 
compete.
E-103.17  Full screening.
    A detailed parts breakout process, including data collection, data 
evaluation, data completion, technical evaluation, economic evaluation, 
and supply feedback, used to determine if parts can be purchased 
directly from the actual manufacturer(s) or can be competed.
E-103.18  Immediate (live) buy.
    A buy which must be executed as soon as possible to prevent 
unacceptable equipment readiness reduction, unacceptable disruption in 
operational capability, and increased safety risks, or to avoid other 
costs.
E-103.19  Life cycle buy value.
    The total dollar value of all acquisitions that are estimated to 
occur over a part's remaining life cycle.
E-103.20  Limited competition.
    A competitive contract action where the provisions of full and open 
competition do not exist.
E-103.21  Limited screening.
    A parts breakout process covering only selected points of data and 
technical evaluations, and should only be used to support immediate buy 
requirements (see E-301.3).
E-103.22  Manufacture.
    The physical fabrication process that produces a part, or other item 
of supply. The physical fabrication processes include, but are not 
limited to machining, welding, soldering, brazing, heat treating, 
braking, riveting, pressing, chemical treatment, etc.
E-103.23  Prime contractor.
    A contractor having responsibility for design control and/or 
delivery of a system/equipment such as aircraft, engines, ships, tanks, 
vehicles, guns and missiles, ground communications and electronics 
systems, and test equipment.
E-103.24  Provisioning.
    The process of determining and acquiring the range and quantity 
(depth) of spare and repair parts, and support and test equipment 
required to operate and maintain an end item of materiel for an initial 
period of service.
E-103.25  Qualification.
    Any action (contractual or precontractual) that results in approval 
for a firm to supply items to the Government without further testing 
beyond quality assurance demonstrations incident to acceptance of an 
item. When prequalification is required, the Government must have a 
justification on file--
    (a) Stating the need for qualification and why it must be done prior 
to award;
    (b) Estimating likely cost of qualification; and
    (c) Specifying all qualification requirements.
E-103.26  Replenishment part.
    A part, repairable or consumable, purchased after provisioning of 
that part, for: replacement; replenishment of stock; or use in the 
maintenance, overhaul, and repair of equipment such as aircraft, 
engines, ships, tanks, vehicles, guns and missiles, ground 
communications and electronic systems, ground support, and test 
equipment. As used in this appendix, except when distinction is 
necessary, the term ``part'' includes subassemblies, components, and 
subsystems as defined by the current version of MIL-STD-280.
E-103.27  Reverse engineering.
    A process by which parts are examined and analyzed to determine how 
they were manufactured, for the purpose of developing a complete 
technical data package. The normal, expected result of reverse 
engineering is the creation of a technical data package suitable for 
manufacture of an item by new sources.
E-103.28  Selected item drawing.
    See current version of DoD-STD-100, paragraph 201.4.5.
E-103.29  Source.
    Any commercial or noncommercial organization which can supply a 
specified part. For coding purposes, sources include actual 
manufacturers, prime contractors, vendors, dealers, surplus dealers, 
distributors, and other firms.
E-103.30  Source approval.
    The Government review that must be completed before contract award.
E-103.31  Source control drawing.
    See the current version of DoD-STD-100, paragraph 201.4.3.

[[Page 602]]

E-103.32  Technical data.
    Specifications, plans, drawings, standards, purchase descriptions, 
and such other data to describe the Government's requirements for 
acquisition.
E-104  General policies.
    (a) The identification, selection, and screening of parts for 
breakout shall be made as early as possible to determine the technical 
and economic considerations of the opportunities for breakout to 
competition or direct purchase. Full and open competition is the 
preferred result of breakout screening.
    (b) A part shall be made a candidate for breakout screening based on 
its cost effectiveness for breakout. Resources should be assigned and 
priority given to those parts with the greatest expected return given 
their annual buy value, life cycle buy value, and likelihood of 
successful breakout, given technical characteristics such as design and 
performance stability. Consideration of all such factors is necessary to 
ensure the maximum return on investment in a given breakout program. 
Occasionally, an item will not meet strict economic considerations for 
breakout, but action may be required due to other considerations to 
avoid overpricing situations. Accordingly, there is no minimum DoD 
threshold for breakout screening actions. DoD components and field 
activities will develop annual buy thresholds for breakout screening 
which are consistent with economic considerations and resources. Every 
effort should be made to complete the full screening of parts that are 
expected to be subsequently replenished as they enter the inventory.
    (c) Breakout improvement efforts shall continue through the life 
cycle of a part to improve its breakout status (see E-203) or until such 
time as the part is coded 1G, 2G, 1K, 2K, 1M, 2M, 1N, 2N, 1T, 2T, 1Z, or 
2Z.
    (d) No firm shall be denied the opportunity to demonstrate its 
ability to furnish a part which meets the Government's needs, without 
regard to a part's annual buy value, where a restrictive AMC/AMSC is 
assigned (see FAR 9.202). A firm must clearly demonstrate, normally at 
its own expense, that it can satisfy the Government's requirements. The 
Government shall make a vigorous effort to expedite its evaluation of 
such demonstration and to furnish a decision to the demonstrating firm 
within a reasonable period of time. If a resolution cannot be made 
within 60 days, the offeror must be advised of the status of the request 
and be provided with a good faith estimate of the date the evaluation 
will be completed. Every reasonable effort shall be made to complete the 
review before a subsequent acquisition is made. Also, restrictive codes 
and low annual buy value do not preclude consideration of a surplus 
dealer or other nonmanufacturing source when the part offered was 
manufactured by an approved source (see FAR 10.010). A potential surplus 
dealer or other nonmanufacturing source must provide the Government with 
all the necessary evidence which proves the proposed part meets the 
Government's requirements.
    (e) The experience and knowledge accrued by contractors in the 
development, design, manufacture and test of equipment may enhance the 
breakout decision making process. DoD activities may obtain technical 
information from contractors when it is considered requisite to an 
informed coding decision. The procedure for contracting for this 
information is provided in Part 4 of this appendix. Contractor's 
technical information will be designated by CTICs. Only DoD activities 
shall assign AMCs and AMSCs.
    (f) DoD activities with breakout screening responsibilities shall 
develop, document, and advertise programs which promote the development 
of qualified sources for parts that are currently being purchased sole 
source. These programs should provide fair and reasonable technical 
assistance (engineering or other technical data, parts on bailment, 
etc.) to contractors who prove they have potential for becoming a 
qualified second source for an item. These programs should also provide 
specially tailored incentives to successful firms so as to stimulate 
their investment in becoming qualified, e.g., Government furnished 
equipment (GFE) or Government furnished material (GFM) for reverse 
engineering and technical data package review and assistance.
    (g) Departments and agencies shall identify the engineering support 
activity, design control activity, actual manufacturer, and prime 
contractor for each part such that the information is readily available 
to breakout and acquisition personnel.
E-105  Responsibilities.
    (a) The Assistant Secretary of Defense (Production and Logistics) 
has authority for direction and management of the DoD Spare Parts 
Breakout Program, including the establishment and maintenance of 
implementing regulations.
    (b) Departments and agencies shall perform audits to ensure that 
their respective activities comply with the provisions of this program.
    (c) Commanders of DoD activities with breakout screening 
responsibility shall--
    (1) Implement a breakout program consistent with the requirements of 
this appendix.
    (2) Assist in the identification and acquisition of necessary data 
rights and technical data, and the review of restrictive legends on 
technical data, during system/equipment development and production to 
allow, when feasible, breakout of parts.
    (3) Designate a program manager to serve as the central focal point, 
communicate breakout policy, ensure cost effectiveness of

[[Page 603]]

screening actions and breakout program, provide assistance in 
implementing breakout screening, monitor ongoing breakout efforts and 
achievements, and provide surveillance over implementation of this 
appendix. The program manager shall report only to the Commander, or 
deputy, of the activity with breakout screening responsibility.
    (4) Ensure that actions to remove impediments to breakout are 
continued so long as it is cost effective, or until no further breakout 
improvements can be made.
    (5) Invite the activity's small business specialist and the resident 
small business administration's procurement center representative (PCR), 
if any, to participate in all acquisition method coding conferences at 
Government and contractor locations.
    (6) Ensure timely engineering and technical support to other 
breakout activities regardless of location.
    (i) In the case of parts where contracting or inventory management 
responsibility has been transferred, support shall include--
    (A) Assignment of an AMC/AMSC prior to the transfer;
    (B) Assignment of an AMC/AMSC when requested by the receiving 
activity to parts transferred without such codes. The requesting 
activity may recommend an AMC/AMSC; and
    (C) Full support of the receiving activities' breakout effort by 
providing timely engineering support in revising existing AMC/AMSCs.
    (ii) In all cases, support shall include, but not be limited to, 
furnishing all necessary technical data and other information (such as 
code suspense date and procurement history) to permit acquisition in 
accordance with the assigned AMC/AMSC (see E-105(d)(6)).
    (7) Ensure that appropriate surveillance is given to first time 
breakout parts.
    (d) Breakout program managers shall be responsible for--
    (1) Initiating the breakout process during the early phases of 
development and continue the process during the life of the part;
    (2) Considering the need for contractor technical information codes 
(CTICs) and, when needed, initiating a contract data requirement;
    (3) Identifying, selecting, and screening in accordance with Part 3 
of this appendix;
    (4) Assigning an AMC/AMSC, using all available data, including 
CTICs;
    (5) Responding promptly to a request for evaluation of additional 
sources or a review of assigned codes. An evaluation not completed prior 
to an immediate buy shall be promptly completed for future buys; and
    (6) Documenting all assignments and changes, to include rationale 
for assigning the chosen code, in a permanent file for each part. As a 
minimum, the file should identify the engineering support activity, 
cognizant design control activity, actual manufacturer, prime 
contractor, known sources of supply, and any other information needed to 
support AMC/AMSC assignments.
    (e) Contracting officers responsible for the acquisition of 
replenishment parts shall--
    (1) Consider the AMC/AMSC when developing the method of contracting, 
the list of sources to be solicited, the type of contract, etc.; and
    (2) Provide information which is inconsistent with the assigned AMC/
AMSC (e.g., availability of technical data or possible sources) to the 
activity responsible for code assignment with a request for timely 
evaluation of the additional information. An urgent immediate buy need 
not be delayed if an evaluation of the additional information cannot be 
completed in time to meet the required delivery date.

                         Part 2--Breakout Coding

E-200  Scope.
    This part provides parts breakout codes and prescribes 
responsibilities for their assignment and management.
E-201  Coding.
    Three types of codes are used in the breakout program.
E-201.1  Acquisition method codes.
    The following codes shall be assigned by DoD activities to describe 
the results of the spare parts breakout screening:
    (a) AMC 0. The part was not assigned AMC 1 through 5 when it entered 
the inventory, nor has it ever completed screening. Use of this code is 
sometimes necessary but discouraged. Maximum effort to determine the 
applicability of an alternate AMC is the objective. This code will never 
be used to recode a part that already has AMC 1 through 5 assigned, and 
shall never be assigned as a result of breakout screening. Maximum 
effort to determine the applicability of AMC 1 through 5 is the 
objective.
    (b) AMC 1. Suitable for competitive acquisition for the second or 
subsequent time.
    (c) AMC 2. Suitable for competitive acquisition for the first time.
    (d) AMC 3. Acquire, for the second or subsequent time, directly from 
the actual manufacturer.
    (e) AMC 4. Acquire, for the first time, directly from the actual 
manufacturer.
    (f) AMC 5. Acquire directly from a sole source contractor which is 
not the actual manufacturer.
E-201.2  Acquisition method suffix codes.
    The following codes shall be assigned by DoD activities to further 
describe the acquisition method code. Valid combinations of AMCs/AMSCs 
are indicated in paragraphs (a)

[[Page 604]]

through (z) of this subsection and summarized in Exhibit I.
    (a) AMSC A. The Government's right to use data in its possession is 
questionable. This code is only applicable to parts under immediate buy 
requirements and for as long thereafter as rights to data are still 
under review for resolution and appropriate coding. This code is 
assigned only at the conclusion of limited screening, and it remains 
assigned until the full screening process resolves the Government's 
rights to use data and results in assignment of a different AMSC. If one 
source is available, AMCs 3, 4, or 5 are valid. If at least two sources 
exist, or if the data is adequate for an alternate source to qualify in 
accordance with the design control activity's procedures, AMCs 1 or 2 
are valid.
    (b) AMSC B. This part must be acquired from a manufacturing 
source(s) specified on a source control or selected item drawing as 
defined by the current version of DoD-STD-100. Suitable technical data, 
Government data rights, or manufacturing knowledge are not available to 
permit acquisition from other sources, nor qualification testing of 
another part, nor use of a second source part in the intended 
application. Although, by DoD-STD-100 definition, altered and selected 
items shall have an adequate technical data package, data review 
discloses that required data or data rights are not in Government 
possession and cannot be economically obtained. If one source is 
available, AMCs 3, 4, or 5 are valid. If at least two sources exist, 
AMCs 1 or 2 are valid.
    (c) AMSC C. This part requires engineering source approval by the 
design control activity in order to maintain the quality of the part. 
Existing unique design capability, engineering skills, and manufacturing 
knowledge by the qualified source(s) require acquisition of the part 
from the approved source(s). The approved source(s) retain data rights, 
manufacturing knowledge, or technical data that are not economically 
available to the Government, and the data or knowledge is essential to 
maintaining the quality of the part. An alternate source must qualify in 
accordance with the design control activity's procedures, as approved by 
the cognizant Government engineering activity. The qualification 
procedures must be approved by the Government engineering activity 
having jurisdiction over the part in the intended application. If one 
source is approved, AMCs 3, 4, or 5 are valid. If at least two sources 
are approved or if data is adequate for an alternate source to qualify 
in accordance with the design control activity's procedures, AMCs 1 or 2 
are valid.
    (d) AMSC D. The data needed to acquire this part competitively is 
not physically available, it cannot be obtained economically, nor is it 
possible to draft adequate specifications or any other adequate, 
economical description of the material for a competitive solicitation. 
AMSC 3, 4, or 5 are valid.
    (e) AMSC E. (Reserved).
    (f) AMSC F. (Reserved).
    (g) AMSC G. The Government has rights to the technical data, the 
data package is complete, and there are no technical data, engineering, 
tooling or manufacturing restrictions. (This is the only AMSC that 
implies that parts are candidates for full and open competition. Other 
AMSCs such as K, M, N, Q, and S may imply limited competition when two 
or more independent sources exist yet the technical data package is 
inadequate for full and open competition.) AMCs 1 or 2 are valid.
    (h) AMSC H. The Government physically does not have in its 
possession sufficient, accurate, or legible data to purchase this part 
from other than the current source(s). This code is applicable only to 
parts under immediate buy requirements and only for as long thereafter 
as the deficiency is under review for resolution and appropriate 
recoding. This code is only assigned at the conclusion of limited 
screening, and it remains assigned until the full screening process 
resolves physical data questions and results in assignment of a 
different AMSC. If one source is available, AMCs 3, 4, or 5 are valid. 
If at least two sources exist, AMCs 1 or 2 are valid.
    (i) AMSC I. (Not authorized.)
    (j) AMSC J. (Reserved.)
    (k) AMSC K. This part must be produced from class 1 castings and 
similar type forgings as approved (controlled) by procedures contained 
in the current version of MIL-STD-2175. If one source has such castings 
and cannot provide them to other sources, AMCs 3, 4, or 5 are valid. If 
at least two sources have such castings or they can be provided to other 
sources AMCs 1 or 2 or valid.
    (l) AMSC L. The annual buy value of this part falls below the 
screening threshold established by DoD components and field activities. 
However, this part has been screened for additional known sources, 
resulting in either confirmation that the initial source exists or that 
other sources may supply the part. No additional screening was performed 
to identify the competitive or noncompetitive conditions that would 
result in assignment of a different AMSC. This code shall not be used 
when screening parts entering the inventory. This code shall be used 
only to replace AMSC O for parts under the established screening 
threshold. If one source is available, AMCs 3, 4, or 5 are valid. If at 
least two sources exist, AMCs 1 or 2 are valid.
    (m) AMSC M. Manufacture of this part requires use of master or 
coordinated tooling. If only one set of tooling exists and cannot be 
made available to another source for manufacture of this part, AMCs 3, 
4, or 5 are valid. When the availability of existent or

[[Page 605]]

refurbishable tooling is available to two or more sources, then AMCs 1 
or 2 are valid.
    (n) AMSC N. Manufacture of this part requires special test and/or 
inspection facilities to determine and maintain ultra-precision quality 
for its function or system integrity. Substantiation and inspection of 
the precision or quality cannot be accomplished without such specialized 
test or inspection facilities. If the test cannot be made available for 
the competitive manufacture of the part, the required test or inspection 
knowledge cannot be documented for reliable replication, or the required 
physical test or inspection facilities and processes cannot be 
economically documented in a TDP, valid AMCs are 3, 4, or 5. If the 
facilities or tests can be made available to two or more competitive 
sources, AMCs 1 or 2 are valid.
    (o) AMSC O. The part was not assigned an AMSC when it entered the 
inventory, nor has it ever completed screening. Use of this code in 
conjunction with AMC 0 is sometimes necessary but discouraged. Maximum 
effort to determine the applicability of an alternate AMSC is the 
objective. Only AMC O is valid.
    (p) AMSC P. The rights to use the data needed to purchase this part 
from additional source(s) are not owned by the Government and cannot be 
purchased, developed, or otherwise obtained. It is uneconomical to 
reverse engineer this part. This code is used in situations where the 
Government has the data but does not own the rights to the data. If only 
one source has the rights or data to manufacture this item, AMCs 3, 4, 
or 5 are valid. If two or more sources have the rights or data to 
manufacture this item, AMCs 1 or 2 are valid.
    (q) AMSC Q. The Government does not have adequate data, lacks rights 
to data, or both needed to purchase this part from additional sources. 
The Government has been unable to economically buy the data or rights to 
the data, although the part has been undergoing full screening for 12 or 
more months. Breakout to competition has not been achieved, but current, 
continuing actions to obtain necessary rights to data or adequate, 
reprocurement technical data indicate breakout to competition is 
expected to be achieved. This part may be a candidate for reverse 
engineering or other techniques to obtain technical data. All AMSC Q 
items are required to be reviewed within the timeframes cited in E-
203(b). If one source is available, AMCs 3, 4, or 5 are valid. If at 
least two sources exist, AMCs 1 or 2 are valid.
    (r) AMSC R. The Government does not own the data or the rights to 
the data needed to purchase this part from additional sources. It has 
been determined to be uneconomical to buy the data or rights to the 
data. It is uneconomical to reverse engineer the part. This code is used 
when the Government did not initially purchase the data and/or rights. 
If only one source has the rights or data to manufacture this item, AMCs 
3, 4, or 5 are valid. If two or more sources have the rights or data to 
manufacture this item, AMCs 1 or 2 are valid.
    (s) AMSC S. Acquisition of this item is restricted to Government 
approved source(s) because the production of this item involves 
unclassified but militarily sensitive technology (see FAR 6.3). If one 
source is approved, AMCs 3, 4, or 5 are valid. If at least two sources 
are approved, AMCs 1 or 2 are valid.
    (t) AMSC T. Acquisition of this part is controlled by qualified 
products list (QPL) procedures. Competition for this part is limited to 
sources which are listed on or are qualified for listing on the QPL at 
the time of award (see FAR Part 9 and DFARS Part 209). AMCs 1 or 2 are 
valid.
    (u) AMSC U. The cost to the Government to breakout this part and 
acquire it competitively has been determined to exceed the projected 
savings over the life span of the part. If one source is available, AMCs 
3, 4, or 5 are valid. If at least two sources exist, AMCs 1 or 2 are 
valid.
    (v) AMSC V. This part has been designated a high reliability part 
under a formal reliability program. Probability of failure would be 
unacceptable from the standpoint of safety of personnel and/or 
equipment. The cognizant engineering activity has determined that data 
to define and control reliability limits cannot be obtained nor is it 
possible to draft adequate specifications for this purpose. If one 
source is available, AMCs 3, 4, or 5 are valid. If at least two sources 
are available, AMCs 1 or 2 are valid.
    (w) AMSC W. (Reserved.)
    (x) AMSC X. (Not authorized.)
    (y) AMSC Y. The design of this part is unstable. Engineering, 
manufacturing, or performance characteristics indicate that the required 
design objectives have not been achieved. Major changes are contemplated 
because the part has a low process yield or has demonstrated marginal 
performance during tests or service use. These changes will render the 
present part obsolete and unusable in its present configuration. Limited 
acquisition from the present source is anticipated pending configuration 
changes. If one source is available, AMCs 3, 4, or 5 are valid. If at 
least two sources exist, AMCs 1 or 2 are valid.
    (z) AMSC Z. This part is a commercial/nondevelopmental/off-the-shelf 
item. Commercial item descriptions, commercial vendor catalog or price 
lists or commercial manuals assigned a technical manual number apply. If 
one source is available, AMCs 3, 4, or 5 are valid. If at least two 
sources are available, AMCs 1 or 2 are valid.

[[Page 606]]

E-201.3  Contractor technical information codes.
    The following two digit alpha codes shall be used by contractors, 
when contractor's assistance is requested. These codes are assigned in 
accordance with the current version of MIL-STD-789 and shall be 
considered during the initial assignment of an AMC/AMSC. For spare parts 
breakout, requirements for contractor assistance through CTIC submission 
shall be accomplished as stated in Part 4 of this appendix. Each CTIC 
submitted by a contractor must be accompanied by supporting 
documentation which justifies the proposed code. These codes and 
supporting documentation, transmitted by DD Form 1418, Contractor 
Technical Information Record, and DD Form 1418-1, Technical Data 
Identification Checklist, are useful not only for code assignment during 
acquisition coding conferences, but also for personnel conducting both 
full and limited screening of breakout candidates. Personnel conducting 
full and limited screening of breakout candidates should use the 
supporting documentation provided with CTICs as a source of information. 
However, they should not allow this information to substitute for 
careful analysis and further investigation of the possibilities of 
acquiring a part through competition or by direct purchase. The 
definitions for CTICs are--
    (a) CTIC CB. Source(s) are specified on source control, altered 
item, or selected item drawings/documents. (The contractor shall furnish 
a list of the sources with this code.)
    (b) CTIC CC. Requires engineering source approval by the design 
control activity in order to maintain the quality of the part. An 
alternate source must qualify in accordance with the design control 
activity's procedures, as approved by the cognizant Government 
engineering activity.
    (c) CTIC CG. There are no technical restrictions to competition.
    (d) CTIC CK. Produced from class 1 castings (see the current version 
of MIL-STD-2175) and similar type forgings. The process of developing 
and proving the acceptability of high-integrity castings and forgings 
requires repetitive performance by a controlled source. Each casting or 
forging must be produced along identical lines to those which resulted 
in initial acceptability of the part. (The contractor shall furnish a 
list of known sources for obtaining castings/forgings with this code.)
    (e) CTIC CM. Master or coordinated tooling is required to produce 
this part. This tooling is not owned by the Government or, where owned, 
cannot be made available to other sources. (The contractor shall furnish 
a list of the firms possessing the master or coordinated tooling with 
this code.)
    (f) CTIC CN. Requires special test and/or inspection facilities to 
determine and maintain ultra-precision quality for function or system 
integrity. Substantiation and inspection of the precision or quality 
cannot be accomplished without such specialized test or inspection 
facilities. Other sources in industry do not possess, nor would it be 
economically feasible for them to acquire facilities. (The contractor 
shall furnish a list of the required facilities and their locations with 
this code.)
    (g) CTIC CP. The rights to use the data needed to purchase this part 
from additional sources are not owned by the Government and cannot be 
purchased.
    (h) CTIC CV. A high reliability part under a formal reliability 
program. Probability of failure would be unacceptable from the 
standpoint of safety of personnel and/or equipment. The cognizant 
engineering activity has determined that data to define and control 
reliability limits cannot be obtained nor is it possible to draft 
adequate specifications for this purpose. Continued control by the 
existing source is necessary to ensure acceptable reliability. (The 
contractor shall identify the existing source with this code.)
    (i) CTIC CY. The design of this part is unstable. Engineering, 
manufacturing, or performance characteristics indicate that the required 
design objectives have not been achieved. Major changes are contemplated 
because the part has a low process yield or has demonstrated marginal 
performance during tests or service use. These changes will render the 
present part obsolete and unusable in its present configuration. Limited 
acquisition from the present source is anticipated pending configuration 
changes. (The contractor shall identify the existing source with this 
code.)
E-202  Assignment of codes.
    The purpose of AMC/AMSC assignments is to provide the best possible 
technical assessment of how a part can be acquired. The technical 
assessment should not be based on issues such as: are the known sources 
actual manufacturers, or are there two actual manufacturers in 
existence; but rather on factors such as the availability of adequate 
technical data, the Government's rights to use the data, technical 
restrictions placed on the hardware (criticality, reliability, special 
testing, master tooling, source approval, etc.) and the cost to breakout 
vice projected savings. In cases where there is additional technical 
information which affects the way a part can be acquired, it should be 
made available to the contracting officer, with the AMC/AMSC. Concerning 
the assignment of AMCs and AMSCs, it is DoD policy that--
    (a) The assignment of AMC/AMSCs to parts is the responsibility of 
the DoD component introducing the equipment or system for which the 
parts are needed in the inventory. Subsequent screening is the 
responsibility of the DoD component assigned technical responsibility.

[[Page 607]]

    (b) When two or more AMSCs apply, the most technically restrictive 
code will be assigned.
    (c) Restricted combinations of AMC/AMSCs are reflected in the AMSC 
definitions. The Defense Logistics Service Center will reject invalid 
code combinations, as shown in Exhibit I, submitted for entry into the 
Federal catalog program (see E-204.2).
    (d) One-time acquisition of a part by a method other than indicated 
by the code does not require a change to the AMC (e.g., when only one of 
a number of sources can meet a short delivery date, or when only one 
manufacturing source is known but acceptable surplus parts are available 
from other sources).
    (e) After the first acquisition under AMC 2 or 4, the AMC shall be 
recoded 1 or 3 respectively.
    (f) Both full and limited screening will result in the assignment or 
reassignment of an AMC/AMSC. This assignment shall be based on the best 
technical judgment of breakout personnel and on information gathered 
during the screening process.
    (g) A part need not be coded as noncompetitive based on an initial 
market survey which only uncovers one interested source. If the 
Government has sufficient technical data in its possession to enable 
other sources to manufacture an acceptable part, and there are no 
technical restrictions on the part which would preclude other sources 
from manufacturing it, the part should be coded competitive.
E-203  Improving part status.
    (a) General. An effective breakout program requires that all 
reasonable actions be taken to improve the acquisition status of parts. 
The potential for improvement of the acquisition status will vary with 
individual circumstances. On one end of the spectrum are those parts 
with acquisition method suffix codes of a temporary nature requiring 
vigorous follow-through improvement action (e.g., AMSCs A and H); on the 
other end are those parts with codes suggesting a relative degree of 
permanence (e.g., AMSCP). A code assigned to a part should never be 
considered fixed with respect to either technical circumstance or time; 
today's technical constraint may be overcome by tomorrow's technology 
and a contractor's rights to data, so zealously protected today, often 
become less important with time. The application of breakout improvement 
effort must always consider individual circumstances and overall 
benefits expected to be obtained.
    (b) Code suspense dates. Every part whose breakout status can be 
improved shall be suspensed for rescreening as appropriate. In general, 
the following codes cannot be improved: 1G, 2G, 1K, 2K, 1M, 2M, 1N, 2N, 
1T, 2T, 1Z, or 2Z. The period between suspenses is a period for which an 
assigned AMC/AMSC is considered active, and routine rescreening of parts 
with ``valid'' codes is not required. Suspense dates may vary with the 
circumstance surrounding each part. A code reached as a result of 
limited screening (E-304) shall not be assigned a suspense date 
exceeding 12 months; a code reached as a result of full screening (E-
303) shall not be assigned a suspense date exceeding three years. In 
exceptional cases, where circumstances indicate that no change can be 
expected in a code over an extended period, a suspense date not 
exceeding five years may be assigned in accordance with controls 
established by the breakout activity. Items with a 1G or 2G code do not 
require a suspense date.
E-204  Communication of codes.
E-204.1  Communication media.
    Use the Federal catalog program formats, set forth in DoD Manual 
4100.39-M, Defense Integrated Data System (DIDS) Procedural Manual, 
communication media and operating instructions as augmented by this 
appendix to disseminate AMCs and AMSCs.
E-204.2  Responsibilities.
    (a) The Defense Logistics Service Center (DLSC) shall--
    (1) Receive and disseminate AMCs and AMSCs for each national stock 
number (NSN) to all appropriate Government activities in consonance with 
scheduled Federal catalog program computer cycles;
    (2) Make the AMCs and AMSCs a part of the data bank of NSN item 
intelligence;
    (3) Perpetuate the codes in all subsequent Federal catalog program 
transactions; e.g., entry of new NSNs and Federal supply code (FSC) 
changes; and
    (4) Reject invalid code combinations submitted for entry into the 
Federal catalog program.
    (b) DoD activities responsible for the assignment of AMCs and AMSCs 
shall--
    (1) Transmit assigned codes for each NSN through normal cataloging 
channels to DLSC under existing Federal catalog program procedures; and
    (2) Notify DLSC by normal Federal catalog program maintenance 
procedures when a change in coding is made.

        Part 3--Identification, selection, and screening of parts

E-300  General.
    This part sets forth procedures for the identification, selection, 
and screening of parts.
E-301  Identification and selection procedures.
E-301.1  Parts entering the inventory.
    The breakout process should begin at the earliest possible stage of 
weapon systems acquisition. Generally, a provisioned part will

[[Page 608]]

require subsequent replenishment. Provisioning or similar lists of new 
parts are, therefore, the appropriate bases for selecting parts for 
screening. This is not to imply that breakout must be done on all items 
as part of the provisioning process. Priorities shall be applied to 
those parts offering the greatest opportunity for breakout and potential 
savings. The major factors in making this determination are--
    (a) The unit price;
    (b) The projected quantity to be purchased over the part's life 
cycle; and
    (c) The potential for screening to result in a part being 
successfully broken out, e.g., item stability, cost, and completeness of 
technical data, etc.
E-301.2  Annual buy forecasts.
    Annually, lists shall be prepared that identify all parts projected 
for purchase during the subsequent 12-month period. Priority should be 
given to those parts with the greatest expected return given their 
annual buy value, life cycle buy value, and likelihood of successful 
breakout, given technical characteristics such as design and performance 
stability and the availability of technical data. Parts with an expired 
suspense date or a suspense date which will expire during the forecast 
period (see E-203(b)), need only be subjected to the necessary steps of 
the full screening procedure (see E-303). Parts with a valid code that 
will not expire during the forecast period need not be screened. Parts 
coded 0O shall be selected for full screening.
E-301.3  Immediate buy requirements.
    An immediate buy requirement will be identified by the user or the 
item manager in consonance with department/agency regulations. When an 
immediate buy requirement meeting the screening criteria (see E-104(b)) 
is generated for a part not assigned a current AMC/AMSC, the part shall 
be promptly screened in accordance with either the full or limited 
screening procedures (see E-303 and E-304).
E-301.4  Suspect AMC/AMSC.
    Whenever an AMC/AMSC is suspected of being inaccurate by anyone, 
including the contracting officer, a rescreening shall be conducted for 
that part. Suspect codes include codes composed of invalid combinations 
of AMCs and AMSCs, those which do not truly reflect how a part is 
actually being acquired, and those suspected of being more restrictive 
than necessary for the next buy.
E-302  Screening.
    (a) Screening procedures include consideration and recording of the 
relevant facts pertaining to breakout decisions. The objective of 
screening is to improve the acquisition status by determining the 
potential for competition, or purchase from an actual manufacturer. 
Consideration of any reasonable approach to establishing competition 
should be an integral part of the breakout process.
    (b) Screening procedures may vary depending on circumstances related 
to the parts. No set rules will provide complete guidance for making 
acquisition method decisions under all conditions encountered in actual 
practice. An informed coding decision can be made without following the 
procedures step by step in every case.
    (c) Activities involved in screening are encouraged to develop 
supplemental procedures which prove effective in meeting this 
regulation's objectives. These procedures should be tailored to the 
particular activity's operating environment and the characteristics of 
the parts for which it is responsible. Nevertheless, care should be 
taken in all cases to assure that--
    (1) Responsible judgment is applied to all elements involved in the 
review of a part;
    (2) The necessary supporting facts are produced, considered, and 
recorded in the breakout screening file. The breakout screening file 
contains technical data and other documents concerning screening of the 
part;
    (3) All cost effective alternatives are considered for establishing 
competition, or purchase from an actual manufacturer (see E-105(d)(6)); 
and
    (4) When possible, the sequence of the review allows for 
accomplishing several screening steps concurrently.
    (d) Contractor participation in the decision making process extends 
only to providing technical information. This technical information is 
provided by supporting documentation (DD Forms 1418, Contractor 
Technical Information Record, and DD Form 1418-1, Technical Data 
Identification Checklist) which includes the CTIC assignment. Government 
personnel shall substantiate the breakout decision by reference to the 
CTIC and by careful review of the supporting documentation. However, the 
CTIC provides guidance only, and it should be used as one of the inputs 
to arrive at an acceptable AMC and AMSC coding.
    (e) Contractor's technical information furnished in accordance with 
MIL-STD-789 may indicate areas requiring additional research by the 
Government before screening can be completed. Seldom will industry's 
contribution to the screening process enable the Government to assign an 
AMC or AMSC without additional review.
    (f) During the screening process, it may be appropriate to 
communicate with industry, particularly potential manufacturers of a 
part, to determine the feasibility of establishing a competitive source 
and to estimate the costs and technical risks involved.
    (g) Coding conferences with industry shall be documented.

[[Page 609]]

    (h) Screening may disclose a part is not suitable for competitive 
acquisition, but it may be possible to breakout the part for direct 
purchase from the actual manufacturer or to establish a second source. 
Parts particularly suited to direct purchase are those where neither the 
design control activity nor the prime contractor contribute additional 
value or whose data belong to the actual manufacturer and will not be 
acquired by the Government, and where that manufacturer exercises total 
responsibility for the part (design and quality control, testing, etc.), 
and where additional operations performed by the prime contractor can be 
performed by the actual manufacturer or by the Government.
    (i) For each part that is screened, a file shall be established to 
document and justify the decisions and results of all screening effort 
(see E-105(d)(6)).
    (j) Full and limited screening procedures are two elements of 
breakout programs. Other spare parts initiatives to enhance breakout are 
reverse engineering, bailment, data rights challenges, and publication 
of intended buy lists. Integration of other initiatives within the 
screening processes developed at each activity is encouraged.
E-303  Full screening procedures.
    (a) Full screening procedures should be developed so that the 
potential is fully evaluated for establishing competition or purchase 
from an actual manufacturer. Also, full screening procedures should 
facilitate accurate and consistent acquisition method code assignment. 
It is expected that each activity will develop its own operational 
screening procedures. A general model, full screening decision process 
is provided below to support the development of activity level 
procedures and to provide guidance regarding the general scope of these 
procedures. The full screening procedures involve 65 steps in the 
decision process, and are divided into the following phases--
    (1) Data collection;
    (2) Data evaluation;
    (3) Data completion;
    (4) Technical evaluation;
    (5) Economic evaluation; and
    (6) Supply feedback.
    (b) The six phases describe different functions that must be 
achieved during screening. The nature of the screening process does not 
permit clear distinction of one phase from another. Further, the order 
of performance of these phases may not correspond to the order listed 
here. In fact, the phases will often overlap and may be performed 
simultaneously. Their purpose is to identify the different functions 
comprising the screening process.
    (c) A summary flow chart of the decision steps is provided as 
Exhibit II to assist in understanding the logical order of the full 
screening steps for various conditions. Use of the flow chart in 
connection with the text that follows is essential to fully understand 
the order of the steps in the process.
E-303.1  Data collection phase (step 1).
    (a) Assemble all available data and establish a file for each part. 
Collect identification data, relevant data obtained from industry, 
contracting and technical history data and current status of the part, 
including--
    (1) Normal identification required for cataloging and 
standardization review;
    (2) All known sources;
    (3) Historical contracting information, including the more recent 
awards, date of awards, and unit price(s) for the quantities prescribed;
    (4) Identification of the actual manufacturer(s), the latest unit 
price and the quantity on which the price is based. (When the actual 
manufacturer is not the design control activity, the design control 
activity may be consulted to ensure the latest version of the item is 
being procured from the actual manufacturer);
    (5) Identification of the activity, Government or industry, having 
design control over the part and, if industry, the cognizant Government 
engineering activity;
    (6) The expected life in the military supply system;
    (7) Record of any prior review for breakout, with results or 
findings; and
    (8) Annual demand.
    (b) In the case of complex items requiring large numbers of 
drawings, collection of a reasonable technical data sample is sufficient 
for the initial technical data evaluation phase (steps 2-14).
E-303.2  Data evaluation phase (steps 2-14).
    (a) Data evaluation is crucial to the whole review procedure. It 
involves determination of the adequacy of the technical data package and 
the Government's rights to use the data for acquisition purposes.
    (b) The data evaluation process may be divided into two stages--
    (1) A brief but intensive analysis of available data and documents 
regarding both technical matters and data rights, leading to a decision 
whether to proceed with screening; and
    (2) If the decision is to proceed with screening, further work is 
necessary to produce an adequate technical data package, such as 
research of contract provisions, engineering work on data and drawings, 
and requests to contractors for additional data.
    (c) The steps in this phase are--(1) Step 2. Are full Government 
rights established by the available data package? Evidence for an 
affirmative answer would include the identification of Government 
drawings, incorporation by reference of Government specifications or 
process descriptions in the public

[[Page 610]]

domain, or reference to contract provisions giving the Government rights 
to data. If the answer is negative, proceed to step 3; if positive, 
proceed to step 6.
    (2) Step 3. Are the contractor's limitations of the Government's 
rights to data established by the available data package?
    (i) The questions in step 2 and 3 are not exclusive. The 
incorporation in a drawing of contract provisions reserving rights to 
the manufacturer, either in the whole design or in certain manufacturing 
processes, would establish a clear affirmative answer to step 3 where 
there is substantiating Government documentation. Parts not in this 
group shall be retained for further processing (see step 20). Data 
rights that cannot be substantiated shall be challenged (see DFARS Part 
227, validation procedures).
    (ii) In the case of clear contractor ownership of rights, proceed 
with steps 4 and 5.
    (3) Step 4. Are there bases for competitive acquisition without 
using data subject to limitations on use? This question requires 
consideration, for example, of the possibility of using performance 
specifications or substitution of military or commercial specifications 
or bulletins for limited elements of the manufacturing process. The use 
of sample copies is another possibility.
    (4) Step 5. Can the Government buy the necessary rights to data? 
This is a preliminary question to the full analysis (in steps 20 and 21 
below) and is designed primarily to eliminate from further consideration 
those items which incorporate established data restrictions and for 
which there are no other bases for competitive acquisition nor is 
purchase of rights possible or feasible.
    (5) Steps 6 and 7. Is the present technical data package adequate 
for competitive acquisition of a reliable part?
    (6) Steps 8 and 9. Specify omissions. The question in steps 6 and 7 
requires a critical engineering evaluation and should deal first with 
the physical completeness of the date--are any essential dimensions, 
tolerances, processes, finishes, material specifications, or other vital 
elements of data lacking from the package? If so, these omissions should 
be specified. A second element deals with adequacy of the existing 
package to produce a part of the required performance, compatibility, 
quality, and reliability. This will, of course, be related to the 
completeness of data. In some cases, qualified engineering judgment may 
decide that in spite of apparently complete data, the high performance 
or other critical characteristics of the item require retention of the 
present source. If such decision is made, the file shall include 
documentation in the form of specific information, such as difficulties 
experienced by the present manufacturer in producing a satisfactory item 
or the existence of unique production skills in the present source.
    (7) Steps 10 and 11. Can the data be developed to make up a reliable 
technical data package? This implies a survey of the specified omissions 
with careful consideration to determine the resources available to 
supply each missing element. Such resources will vary from simple 
referencing of standard engineering publications to more complex 
development of drawings with the alternatives of either obtaining such 
drawings or developing performance specifications. In some cases, 
certain elements of data are missing because they have been properly 
restricted. If, however, there has been no advance substantiation of the 
right to restrict, the part should be further researched. If the answer 
to this question is negative, proceed to step 12; if positive, proceed 
to step 13 or 14.
    (8) Step 12. If the answer to the question in steps 10 and 11 is no, 
which condition is the prime element in this decision, the lack of data 
or the unreliability of the data? Specific documentation is needed to 
support this decision.
    (9) Steps 13 and 14. Estimate the time required to complete the data 
package. In those cases where the data package is found inadequate and 
specific additions need to be developed, an estimate of the time 
required for completion must be made in order to determine if breakout 
of the part is feasible during this review cycle and to estimate at what 
point in the remaining life of the part the data package could be 
available.
E-303.3  Data completion phase (steps 15-21).
    (a) The data completion phase involves acquiring or developing the 
missing elements of information to reach a determination on both 
adequacy of the technical data package and the restriction of rights to 
data. It may involve various functional responsibilities, such as 
examination of past contracts, queries directed to industry or to other 
Government agencies, inspection of the part, reverse or other 
engineering work to develop drawings and write specifications, 
arrangements with the present source for licensing or technical 
assistance to new manufacturers, and negotiations for purchase of rights 
to data. Additional research and information requests should be 
expeditiously initiated on those parts where there is a reasonable 
expectation of breakout. Because this phase is time-consuming, it should 
take place concurrently with other phases of the review.
    (b) At the beginning of the data completion phase, the part falls 
into one of the following four steps--
    (1) Step 15. The data package is complete and adequate and the 
Government has sufficient rights for acquisition purposes. Such parts 
require no further data analysis. Proceed to step 22.
    (2) Step 16. The Government has rights to existing data. The data 
package is incomplete but there is a reasonable expectation

[[Page 611]]

that the missing elements can be supplied. Proceed to step 19.
    (3) Step 17. The data package is complete, but suitable Government 
rights to the data have not been established. Proceed to step 20.
    (4) Step 18. Neither rights nor completeness of data is adequately 
established; therefore, the part requires further research. Proceed to 
step 20.
    (c) Step 19. Obtain or develop the necessary data for a suitable 
data package. Reverse engineering to develop acquisition data may be 
used if there is a clear indication that the costs of reverse 
engineering will be less than the savings anticipated from competitive 
acquisition. If there is a choice between reverse engineering and the 
purchase of data (step 21), the decision shall be made on the basis of 
relative costs, quality, time, and other pertinent factors.
    (d) Step 20. Establish the Government's and contractor's rights to 
the data. Where drawings and data cannot be identified to a contract, 
the following guidelines should be applied--
    (1) Where drawings and data bear legends which warn of copyright or 
patent rights, the effect of such legends shall be resolved according to 
law and policy; however, the existence of patent or copyright 
restrictions does not per se preclude securing competition with respect 
to the parts described (see FAR Subpart 27.3/DFARS Subpart 227.3).
    (2) If the technical data bears legends which limit the Government's 
right to use the data for breakout and it is determined that reasonable 
grounds exist to question the current validity of the restrictive 
markings, the contracting officer will be notified to initiate the 
validation procedures at DFARS Subpart 227.4.
    (3) Where drawings and data are unmarked and, therefore, free of 
limitation on their use, they shall be considered available for use in 
acquisition, unless the acquiring office has clear evidence to the 
contrary (see DFARS Subpart 227.4).
    (4) The decision process in situations described in paragraphs (d) 
(1), (2), and (3) of this subsection requires the exercise of sound 
discretion and judgment and embraces legal considerations. In no case 
shall a decision be made without review and approval of that decision by 
legal counsel.
    (5) If the validation procedures in paragraph (d)(2) of this 
subsection establish the Government's right to use the data for 
breakout, the Government shall attempt to obtain competition pursuant to 
the decisions resulting from concurrent technical and economic 
evaluation.
    (e) Step 21. If restrictions on the use of data are established, 
determine whether the Government can buy rights to the required data. 
Use the procedure in DFARS Subpart 227.4.
E-303.4  Technical evaluation phase (steps 22-37).
    (a) Introduction. (1) The purposes of technical evaluation are to 
determine the development status, design stability, high performance, 
and/or critical characteristics such as safety of personnel and 
equipment; the reliability and effective operation of the system and 
equipment in which the parts are to be used; and to exercise technical 
judgment as to the feasibility of breaking out the parts. No simple and 
universal rules apply to each determination. The application of 
experience and responsible judgment is required. Technical 
considerations arise in several elements of the decision process, e.g., 
in determining adequacy of the data package (steps 6-14).
    (2) Certain manufacturing conditions may reduce the field of 
potential sources. However, these conditions do not justify the 
restriction of competition by the assignment of restrictive AMCs for the 
following reasons--
    (i) Parts produced from class 1 castings and similar type forgings. 
The process of developing and providing the acceptability of high-
integrity castings and forgings requires repetitive performance by a 
controlled source for each casting or forging along identical lines to 
those which result in initial acceptability of the item. The particular 
manufacturer's process becomes the controlling factor with regard to the 
acceptability of any such item. However, other firms can produce class 1 
castings and similar type forgings and provide the necessary inspection, 
or the part may be acquired from other sources which use castings or 
forgings from approved (controlled) source(s).
    (ii) Parts produced from master or coordinated tooling, e.g., 
numerically controlled tapes. Such parts have features (contoured 
surfaces, hole locations, etc.) delineated according to unique master 
tooling or tapes and are manufactured to minimum/maximum limits and must 
be replaceable without additional tailoring or fitting. These parts 
cannot be manufactured or configured by a secondary pattern or jigs 
independent of the master tooling and cannot be manufactured to 
requisite tolerances of fit by use of commercial precision machinery. In 
this context, jigs and fixtures used only for ease of production are not 
considered master tooling. However, master tooling may be reproduced.
    (iii) Parts requiring special test and/or inspection facilities to 
determine and maintain ultra-precision quality for the function or 
system integrity. Substantiation and inspection of the precision or 
quality cannot be accomplished without specialized test or inspection 
facilities. Testing is often done by the actual manufacturer under 
actual operating use. However, such special test inspection facilities 
may be available at other firms.

[[Page 612]]

    (b) Design procedures (steps 22-31). (1) Step 22. Will a design 
change occur during anticipated lead time? If affirmative, proceed to 
step 23; if negative, proceed to step 24.
    (2) Step 23. Specify the design change and assign an appropriate 
code.
    (3) Step 24. Is a satisfactory part now being produced? Concurrently 
with the research and completion of data, a technical determination is 
required as to the developmental status of the part. With the frequent 
telescoping of the development/production cycle as well as constant 
product improvement throughout the active life of equipment, parts are 
frequently subject to design changes. The present source, if a prime 
contractor, is usually committed to incorporate the latest changes in 
any deliveries under a production order. In considering the part for 
breakout, an assessment must be made of the stability of design, so that 
in buying from a new source the Government will not be purchasing an 
obsolete or incompatible part. The question of obsolescence or 
noncompatibility is to some extent under Government control. Screening 
for breakout on parts that are anticipated to undergo design change 
should be deferred until design stability is attained.
    (4) Step 25. Can a satisfactory part be produced by a new source? 
Determine whether technical reasons prohibit seeking a new source. The 
fact that the present source has not yet been able to produce a 
satisfactory part (step 24) does not preclude another source from being 
successful. If the answer to step 24 or 25 is affirmative, proceed 
simultaneously to steps 27 and 38. If the answer to step 25 is negative, 
proceed to step 26.
    (5) Step 26. If the present source is producing an unsatisfactory 
part, but technical reasons prohibit seeking a new source, specify the 
reasons.
    (6) Step 27. Does the part require prior qualification or other 
approval testing? If the answer is positive, proceed to step 28; if 
negative, proceed to step 32.
    (8) Step 28. Specify the requirement.
    (9) Step 29. Estimate the time required to qualify a new source.
    (10) Step 30. Is there currently a qualified source?
    (11) Step 31. Who is responsible for qualifications of the 
subcontractor, present prime contractor, the Government, or an 
independent testing agency?
    (i) If a qualified source is currently in existence, the review 
should consider who will be responsible for qualification in the event 
of competitive acquisition. If qualification testing is such that it can 
be performed by the selected source under a preproduction or first 
article clause in the contract, the costs of initial approval should be 
reflected in the offers received. If the part requires initial 
qualification tests by some other agency such as the present prime 
contractor, the Government, an independent testing agent outside the 
Government, or by technical facilities within the departments, out-of-
pocket costs may be incurred if the part is competed. An estimate of 
qualification costs should then be made and recorded in such cases.
    (ii) Where facilities within the Government are not adequate for 
testing or qualification, or outside agencies such as the equipment 
contractor cannot or will not do the job, the economics of qualification 
may be unreasonable, and a narrative statement of these facts should 
replace the cost estimate. Whenever possible, such as in the case of 
engine qualification tests, economy of combined qualification tests 
should be considered.
    (c) Quality assurance procedures (steps 32-33). Quality control and 
inspection is a primary consideration when making a decision to 
breakout. Where the prime contractor performs quality assurance 
functions beyond those of the part manufacturer or other sources, the 
Government may--
    (1) Develop the same quality control and inspection capability in 
the manufacturer's plant;
    (2) Assume the responsibility for quality; or
    (3) Undertake to obtain the quality assurance services from another 
source, possibly the prime contractor.
    (4) Step 32. Who is now responsible for quality control and 
inspection of the part?
    (5) Step 33. Can a new source be assigned responsibility for quality 
control? Is the level of the quality assurance requirements specified in 
the system contract necessary for the screened part? The minimum quality 
assurance procedures for each part shall be confirmed.
    (i) A new source shall be considered if--
    (A) Any essential responsibility (e.g., burn-in, reliability, 
maintainability) retained by the prime contractor for the part and its 
relationship to the end item can be eliminated, shifted to the new 
source, or assumed by the Government;
    (B) The prime contractor will provide the needed quality assurance 
services;
    (C) The Government can obtain competent, impartial services to 
perform quality assurance responsibility; or
    (D) The new source can maintain an adequate quality assurance 
program, inspection system, or inspection appropriate for the part.
    (ii) If the prime contractor has responsibility for quality that a 
new source cannot assume or obtain, or that the Government cannot 
undertake or eliminate, consideration of the new source is precluded.
    (d) Tooling procedures (steps 34-37). (1) Step 34. Is tooling or 
other special equipment required?
    (2) Step 35. Specify the type of tooling.

[[Page 613]]

    (3) Step 36. Estimate additional acquisition leadtime for setup and 
for tooling.
    (4) Step 37. Does the Government possess this tooling? If tooling or 
special equipment is required for production of the part, the types and 
quantities should be specified. Investigation can then be made as to 
whether the Government possesses such tooling and can make it available 
to a new source. A requirement for special tooling is not necessarily a 
deterrent to competitive solicitation for parts. The Government may find 
it desirable to purchase the needed tooling and furnish it to the new 
source. In this case, the costs can be determined with reasonable 
accuracy. However, if new sources can provide the tooling or special 
equipment, this will be reflected in competitive prices and should not 
normally require further analysis.
E-303.5  Economic evaluation phase (steps 38-56).
    (a) Economic evaluation concerns identification and estimation of 
breakout savings and direct cost offsets to breakout. The economic 
evaluation phase is composed of the three segments detailed in 
paragraphs (b) through (d) of this subsection.
    (b) Development of savings data (steps 38-40). (1) Step 38. Estimate 
remaining program life cycle buy value.
    (2) Step 39. Apply either a savings factor of 25 percent or one 
determined under local conditions and experience.
    (3) Step 40. Multiply the remaining program life cycle buy value by 
the savings factor to obtain the expected future savings, if the part is 
coded for breakout.
    (c) Computation of breakout costs (steps 41-47). Several groups of 
costs must be collected, summarized and compared to estimated savings to 
properly determine the economics of breakout. These costs include--
    (1) Direct costs (steps 41-45). Direct costs of breakout normally 
include all expenditures which are direct and wholly identifiable to a 
specific, successful breakout action, and which are not reflected in the 
part unit price. Examples of direct costs include Government tooling or 
special test equipment, qualification testing, quality control expenses, 
and industry participation costs (such as completion of the Contractor 
Technical Information Data Record) if borne by the Government.
    (i) Step 41. Estimate the cost to the Government for tooling or 
special equipment.
    (ii) Step 42. Estimate the cost, if any, to the Government for 
qualifying the new source.
    (iii) Step 43. Estimate the cost, if any, to the Government for 
assuring quality control, or the cost of contracting for quality 
control.
    (iv) Step 44. Estimate the cost to the Government for purchasing 
rights to data.
    (v) Step 45. Add estimated total direct costs to the Government to 
breakout the item.
    (2) Performance specification costs (steps 46-47). (i) Step 46. Is 
the breakout candidate constructed to a performance specification?
    (ii) Step 47. If the answer is yes in step 46, add performance 
specification breakout cost estimate elements to the result of step 45. 
The addition of an unknown number of nonstocked parts which must be 
stocked by the supply system for repairs is a significant element of 
cost associated with the decision to compete a performance specification 
assembly. (The same situation does not arise with respect to a design 
specification assembly since virtually all spare parts used to repair 
such an assembly are essentially identical to parts already in the 
assembly.) The cost of introducing these nonstocked parts into the 
system includes--
    (A) Additional catalog costs. The number of nonstocked parts 
forecasted to be in the competed assembly, multiplied by the variable 
cost of cataloging per line item.
    (B) Additional bin opening costs.
    The number of nonstocked parts forecasted to be in the competed 
assembly, multiplied by the variable cost of a bin opening at each of 
the locations where the part is to be stocked.
    (C) Additional management costs. The number of nonstocked parts 
forecasted to be in the competed assembly, multiplied by the variable 
cost of management per line item.
    (D) Additional technical data costs. The cost of a new set of 
technical data for the competed assembly, including the variable 
expenses of its production, reproduction, and distribution.
    (E) Additional repair tools and test equipment costs. The costs of 
additional special tools and test equipment not otherwise required by 
the existing assembly.
    (F) Additional logistics support costs. The costs associated with 
the new item such as spare and repair parts, technical manuals, and 
training.
    (d) Comparison of savings and costs (steps 48-56). Compare estimated 
breakout costs to forecasted breakout savings. If costs exceed estimated 
savings, it will be uneconomical to compete the part. Performance 
specification parts should be analyzed to ensure that pertinent breakout 
costs have been considered and, if it is not economical to breakout the 
part, whether an appropriate detailed design data package reduces costs 
sufficiently to make breakout economical.
    (1) Step 48. Compare total costs of breakout (step 47) to estimated 
savings (step 40).
    (2) Step 49. Are costs of breakout greater or less than estimated 
savings? If greater, proceed to step 50; if yes, proceed to step 51.
    (3) Step 50. Is the breakout candidate constructed to a performance 
specification? If

[[Page 614]]

no, proceed to step 54; if yes, proceed to step 57.
    (4) Step 51. Is it appropriate to obtain a detailed design data 
package? If yes, proceed to step 52; if no, proceed to step 54. The 
decision to change a performance specification part to a detailed design 
part obviously requires a critical engineering examination of the part 
itself, as well as a review of the impact such a change might have on 
the operational effectiveness of the system in which the equipment is to 
be employed. Acquisition of a performance specification part by a 
subsequently acquired design specification subjects the Government to 
the additional hazard of losing the money paid for the development of 
the design specification, should the design be altered during the 
contracting leadtime period. Accordingly, the engineering evaluation 
should closely review design stability over the anticipated contracting 
leadtime in order to avoid acquiring an obsolete or nonstandard part if 
the decision is made to compete it.
    (5) Step 52. Add the estimated cost of obtaining a detailed design 
data package to the results of step 45.
    (6) Step 53. If the results of step 52 are less than the estimated 
savings, initiate action to obtain a detailed design data package. 
Proceed to step 54 to code the part for a period until it can be 
rescreened using the design specification package. The code determined 
in this screening shall be assigned a suspense date commensurate with 
the leadtime required to obtain the detailed design data package (see E-
203(b)).
    (7) Step 54. Is the part manufactured by the prime contractor? If 
yes, code the part AMC 3; if no, proceed to step 55.
    (8) Step 55. Can the part be acquired directly from the actual 
manufacturer? If no, proceed to step 56; if yes, code the part AMC 3 or 
4, as applicable.
    (9) Step 56. Specify the reasons for inability to obtain the part 
from the actual manufacturer. Code the part AMC 5.
E-303.6  Supply feedback phase (steps 57-65).
    (a) The supply feedback phase of the analysis is the final screening 
phase for breakout parts. This phase in completed for all AMC 2 parts to 
determine if sufficient time is available to breakout on the immediate 
buy and to communicate this information to the inventory manager 
responsible for the requirement. First, all additional time factors 
required to breakout the part are added. Total time is subtracted from 
the immediate and future buy date and the result compared to the current 
date. (Note: Not all time factors listed apply to each part screened.) 
If the result is the same or earlier than the required contract date, 
the part is coded competitive and action is begun to qualify additional 
sources as necessary. If the result is later than the required contract 
date, action to compete the immediate buy quantity should be initiated 
if the inventory manager can find some means of accepting later 
delivery. If this is impossible, the appropriate records should be 
annotated for competitive acquisition of the next replenishment buy 
quantity. If late delivery is acceptable, the inventory manager should 
compute requirements for the part and initiate an appropriate purchase 
requisition.
    (b) Procedures. (1) Step 57. Add all additional time factors 
required to breakout the part (steps 13, 14, 29, and 36).
    (2) Step 58. Add the results of step 57 to the date of this review.
    (3) Step 59. Compare the result of step 58 to the date that the 
contract or order must be placed.
    (4) Step 60. Is the result of step 59 earlier than, later than, or 
the same as the contract or order date? (If earlier or the same, proceed 
to step 61; if later, proceed to step 63.)
    (5) Step 61. Can supply accept late delivery? If yes, proceed to 
step 62; if no, proceed to step 63.
    (6) Step 62. Notify the inventory manager to compute requirements 
and initiate a purchase requisition. Proceed to step 64.
    (7) Step 63. Code the part AMC 2. Insufficient time to compete on 
this buy.
    (8) Step 64. Code the part AMC 2.
    (9) Step 65. Begin actions to qualify new sources, if required and 
possible.
E-304  Limited screening procedures.
    (a) Limited screening procedures are only appropriate when the full 
screening process cannot be completed for a part in sufficient time to 
support an immediate buy requirement. If limited screening does not 
result in a competitive AMC and the part is characterized by a high buy 
value and high buy quantity in the annual buy forecast, full screening 
procedures shall be immediately initiated.
    (b) Limited screening procedures cover only the essential points of 
data and technical evaluations more completely described in full 
screening procedures (see E-303). Extensive legal review of rights or 
technical review of data is not required; nor is backup information on 
type and extent of qualification testing, quality control procedures and 
master tooling required. A summary flow chart of the limited screening 
decision steps is provided at Exhibit III.
    (c) The limited screening decision steps are followed sequentially 
if the answer to the question in each step is affirmative. If any step 
is answered in the negative, proceed directly to step 10.
    (1) Step 1. Assemble all available data and establish a file for 
each part. Collect identification data, relevant data obtained from 
industry, contracting and technical history

[[Page 615]]

data and current status of the part (see E-303.1).
    (2) Step 2. Do the available documents establish Government rights 
to use the data for acquisition purposes? If the Government's rights to 
use data in its possession is questionable, resolution of the rights 
must continue beyond award of the immediate buy.
    (3) Step 3. Is the data package sufficient, accurate, and legible? 
If the Government does not have in its possession sufficient, accurate, 
or legible data, action shall be promptly initiated to resolve the 
deficiency for the next buy.
    (4) Step 4. Is the design of the part stable over the anticipated 
acquisition leadtime?
    (5) Step 5. Is a satisfactory part now being produced?
    (6) Step 6. Can the part be acquired from a new source without prior 
qualification testing or other approval testing?
    (7) Step 7. Can the Government or a new source be responsible for 
quality assurance?
    (8) Step 8. Can the part be manufactured without master or 
coordinated tooling or other special equipment; if no, is there more 
than one source which has the tooling or special equipment?
    (9) Step 9. Assign AMC 2. Proceed to step 11.
    (10) Step 10. Assign AMC 3, 4, or 5, as appropriate.
    (11) Step 11. Establish the date of the next review (see E-104(c) 
and E-203(b)).

                     Part 4--Contractor's Assistance

E-400  General.
    (a) Contractor's assistance in screening shall be requested on 
provisioned and replenishment parts after consideration of the benefit 
expected from the contractor's technical information and the cost to the 
Government of obtaining such assistance.
    (b) Contractor's assistance shall not be requested for parts covered 
by Government/industry specifications, commercially available parts or 
parts for which data is already available.
    (c) Arrangements entered into with contractor to obtain technical 
information shall provide that--
    (1) Contractors will exert their best effort to make impartial 
technical evaluations using applicable technical data and the experience 
of competent personnel; and
    (2) No costs to the Government will be incurred for duplicate 
screening of parts.
E-401  Contractor's technical evaluation procedures.
    (a) Contractor's technical evaluation for the screening process 
shall be required contractually by incorporating MIL-STD-789, which 
delineates the contractor's responsibilities and procedures and 
prescribes use of the contractor DD Form 1418, Technical Information 
Record, and the DD Form 1418-1, Technical Data Identification Checklist, 
a copy of each document listed on DD Form 1418-1, and other substantive 
data that was used in developing the contractor's recommendations.
    (b) When MIL-STD-789 is incorporated in a contract, the DD Form 
1423, Contract Data Requirements List, shall specify the requirement for 
the submission of DD Form 1418, Technical Information Record, and DD 
Form 1418-1, Technical Data Identification Checklist, in accordance with 
MIL-STD-789.

                        Part 5--Reporting System

E-500  General.
    This part prescribes reports regarding the breakout program which 
cannot be obtained from other sources. These reports are used to 
evaluate the effectiveness of breakout programs, establish a baseline 
for all spare part acquisitions, and identify trends in spare parts 
acquisition.
E-501  Reports.
    (a) Spare Parts Breakout Screening Report (RCS DD P&L(Q&SA)714A). 
This is a cumulative semi-annual report reflecting the accomplishments 
of the breakout program. The report describes the results of full and 
limited screening for provisioning and replenishment parts by number of 
different NSNs for each AMC. Departments and agencies shall also 
maintain actual cost data attributable to the Spare Parts Breakout 
Program which shall be forwarded on this report semi-annually.
    (b) Spare Parts Acquisition Report (RCS DD P&L(Q&SA) 714B). This is 
a cumulative semi-annual report for all purchases made of spare parts 
during the current fiscal year. This report describes the number and 
extended dollar value of different NSNs purchased for each AMC. 
Departments and agencies shall also maintain actual savings (or cost 
avoidance) data attributable to the Spare Parts Breakout Program which 
shall be forwarded on this report semi-annually. Because of extraneous 
factors such as contracting leadtimes and changes in spare parts 
requirements, this report will not always reflect the acquisition of the 
parts screened during a reporting period (contained on the Spare Parts 
Breakout Screening Report). Also, it will not show in all instances how 
the part was actually acquired. This report is intended to be an 
indication of the success of the breakout program, and designed to show 
trends in the coding and data available to buyers in the acquisition 
package.
E-502  Reporting procedures.
    (a) Departments and agencies shall maintain and forward semi-annual 
reports. The second semi-annual report in a fiscal year

[[Page 616]]

shall reflect cumulative totals for the current fiscal year using the 
formats in Exhibits IV and V.
    (b) The reports will be due no later than 45 days after the end of 
each period designated.
    (c) Submissions will be made to the Assistant Secretary of Defense 
(Production and Logistics), ATTN: Deputy Assistant Secretary for 
Logistics.
E-503  Reporting instructions.
    (a) Spare parts breakout screening report. Using the format in 
Exhibit IV, provide the following--
    (1) Enter reporting activity name, fiscal year, and period ending.
    (2) For each AMC/AMSC listed, enter the number of different NSNs for 
which screening was completed during the period. Show zeros where 
applicable. This should be done for both full and limited screening.
    (3) Report the total costs of the breakout program incurred for the 
period. Although this will be primarily labor costs, it should also 
include appropriate prorated costs of ADP services, office overhead, 
data retrieval service costs, etc. (see E-303.5).
    (b) Spare parts acquisition report. Using the format in Exhibit V, 
provide the following--
    (1) Enter reporting activity name, fiscal year, and period ending.
    (2) For each AMC/AMSC listed, enter the number of different NSNs 
purchased during the current fiscal year and their extended dollar 
value.
    (3) Report the actual breakout program savings or cost avoidances as 
measured by completed acquisition (not anticipated acquisitions). Price 
differentials should be measured on each acquisition where a breakout 
action has taken place. They should equal the difference between the 
previous contract unit price and the current contract unit price, times 
the number of units purchased.

                 Exhibit I--Valid AMC/AMSC Combinations                 
                      Acquisition Method Code (AMC)                     
------------------------------------------------------------------------
   AMSC         0          1          2         3         4         5   
------------------------------------------------------------------------
A                X          o         o         o         o         o   
B                X          o         o         o         o         o   
C                X          o         o         o         o         o   
D                X          X         X         o         o         o   
G                X          o         o         X         X         X   
H                X          o         o         o         o         o   
K                X          o         o         o         o         o   
L                X          o         o         o         o         o   
M                X          o         o         o         o         o   
N                X          o         o         o         o         o   
O                o          X         X         X         X         X   
P                X          o         o         o         o         o   
Q                X          o         o         o         o         o   
R                X          o         o         o         o         o   
S                X          o         o         o         o         o   
T                X          o         o         X         X         X   
U                X          o         o         o         o         o   
V                X          o         o         o         o         o   
Y                X          o         o         o         o         o   
Z                X          o         o         o         o         o   
------------------------------------------------------------------------
o = Valid Combinations.                                                 
X = Invalid Combinations.                                               

     Exhibit II--Full Screening Decision Process Summary Flow Chart

    Note: Exhibit II appears in the 1991 Looseleaf Edition of the 
Defense FAR Supplement. Copies can be obtained from: Defense Acquisition 
Regulations System, OUSD(A), Washington, DC 20301-3000.

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[[Page 618]]


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[[Page 619]]


[GRAPHIC] [TIFF OMITTED] TC01MR91.123

[56 FR 36595, July 31, 1991, as amended at 58 FR 37868, July 14, 1993]

[[Page 620]]

          Appendix F--Material Inspection and Receiving Report

Sec.
Part 1--Introduction
    F-101  General.
    F-102  Applicability.
    F-103  Use.
    F-104  Application.
    F-105  Forms.
Part 2--Contract Quality Assurance (CQA) on Shipments Between 
          Contractors
    F-201  Instructions.
Part 3--Preparation of the DD Form 250 and DD Form 250c
    F-301  Preparation instructions.
    F-302  Mode/method of shipment codes.
    F-303  Consolidated shipments.
    F-304  Multiple consignee instructions.
    F-305  Correction instructions.
    F-306  Invoice instructions.
    F-307  Packing list instructions.
    F-308  Receiving instructions.
Part 4--Distribution of DD Form 250 and DD Form 250c
    F-401  Distribution.
Part 5--Preparation of the DD Form 250-1 (Loading Report)
    F-501  Instructions.
Part 6--Preparation of the DD Form 250-1 (Discharge Report)
    F-601  Instructions.
Part 7--Distribution of the DD Form 250-1
    F-701  Distribution.
    F-702  Corrected DD Form 250-1.

    Authority; 41 U.S.C. 421 and 48 CFR chapter 1.

                          Part 1--Introduction

F-101  General.
    This appendix contains procedures and instructions for the use, 
preparation, and distribution of the material inspection and receiving 
report (MIRR) (DD Form 250 series) and commercial shipping/packing lists 
used to document Government contract quality assurance.
F-102  Applicability.
    (a) The provisions of this appendix apply to supplies or services 
acquired by DoD when the clause at 252.246-7000, Material Inspection and 
Receiving Report, is included in the contract. If the contract contains 
the clause at FAR 52.213-1, Fast Payment Procedure, the contractor may 
elect not to prepare a DD Form 250.
    (b) When DoD provides quality assurance or acceptance services for 
non-DoD activities, prepare a MIRR using the instructions in this 
appendix, unless otherwise specified in the contract.
F-103  Use.
    (a) The DD Form 250 is a multipurpose report used--(1) To provide 
evidence of Government contract quality assurance at origin or 
destination;
    (2) To provide evidence of acceptance at origin or destination;
    (3) For packing lists;
    (4) For receiving;
    (5) For shipping;
    (6) As a contractor invoice; and
    (7) As commercial invoice support.
    (b) Do not use the DD Form 250 for shipments--(1) By subcontractors, 
unless the subcontractor is shipping directly to the Government; or
    (2) Of contract inventory.
    (c) The contractor prepares the MIRR, except for entries that an 
authorized Government representative is required to complete.
    (d) Use the DD Form 250-1--(1) For bulk movements of petroleum 
products by tanker or barge to cover--
    (i) Origin or destination acceptance of cargo; or
    (ii) Shipment or receipt of Government owned products.
    (2) To send quality data to the point of acceptance in the case of 
origin inspection on FOB destination deliveries or preinspection at 
product source. Annotate the forms with the words ``INSPECTED FOR 
QUALITY ONLY.''
F-104  Application.
    (a) DD Form 250. (1) Use the DD Form 250 for delivery of contract 
line, subline, exhibit line, or exhibit subline items. Do not use the DD 
Form 250 for those exhibit line or exhibit subline items on a DD Form 
1423, Contract Data Requirements List, that indicate no DD Form 250 is 
required.
    (2) If the shipped to, marked for, shipped from, mode of shipment, 
contract quality assurance and acceptance data are the same for more 
than one shipment made on the same day under the same contract, 
contractors may prepare one MIRR to cover all such shipments.
    (3) If the volume of the shipment precludes the use of a single car, 
truck, or other vehicle, prepare a separate MIRR for the contents of 
each vehicle.
    (4) When a shipment is consigned to an Air Force activity and the 
shipment includes items of more than one federal supply class (FSC) or 
material management code (MMC), prepare a separate DD Form 250 for items 
of each of the FSCs or MMCs in the shipment. However, the cognizant 
Government representative may authorize a single DD Form 250, listing 
each of the FSCs or MMCs included in the shipment on a separate 
continuation sheet. The MMC appears as a suffix to the national stock 
number applicable to the item.
    (5) Consolidation of Petroleum Shipments on a Single MIRR--(i) 
Continental United States. Contractors may consolidate multiple car or 
truck load shipments of petroleum

[[Page 621]]

made on the same day, to the same destination, against the same contract 
line item, on one MIRR. To permit verification of motor deliveries, 
assign each load a load number which can be identified to the shipment 
number in Block 2 of the DD Form 250. Include a shipping document 
(commercial or government) with each individual load showing as a 
minimum--
    (A) The shipper;
    (B) Shipping point;
    (C) Consignee;
    (D) Contract and line item number;
    (E) Product identification;
    (F) Gross gallons (bulk only);
    (G) Loading temperature (bulk only);
    (H) American Petroleum Institute gravity (bulk only);
    (I) Identification of carrier's equipment;
    (J) Serial number of all seals applied; and
    (K) Signature of supplier's representative.
    When acceptance is at destination, the receiving activity retains 
the shipping document(s) to verify the entries on the consignee copy of 
the DD Form 250 forwarded by the contractor (reference F-401, Table 1) 
before signing Block 21B.
    (ii) Overseas. The same criteria as for continental U.S. applies, 
except the consolidation period may be extended, if acceptable to the 
receiving activity, shipping activity, Government finance office, and 
the authorized Government representative having cognizance at the 
contractor's facility. In addition, the contractor may include more than 
one contract line item in each DD Form 250 if the shipped to, marked 
for, shipped from, mode of shipment, contract quality assurance, and 
acceptance data are the same for all line items.
    (6) Consolidation of Coal Shipments on a Single MIRR. Contractors 
may consolidate multiple railcar or truck shipments of coal made on the 
same day, to the same destination, against the same contract line items, 
on one MIRR. To permit verification of truck deliveries, assign each 
load a load number which can be identified to the shipment number in 
Block 2 of the DD Form 250 and the analytical test report. Include a 
commercial shipping document with each individual truck load showing as 
a minimum--
    (i) The shipper;
    (ii) The name or names;
    (iii) Location and shipping point of the mine or mines from which 
the coal originates;
    (iv) The contract number;
    (v) The exact size of the coal shipped; and
    (vi) A certified weighmaster's certification of weight for the 
truckload.
    Include a waybill with each rail shipment showing the identical 
information. To permit verification of rail deliveries, identify each 
railcar number comprising the shipment to the shipment number in Block 2 
of the DD Form 250 and the analytical test report. When acceptance is at 
destination, the receiving activity must retain the shipping document(s) 
to verify the entries on the consignee copy of the DD Form 250.
    (b) DD Form 250-1. (1) Use a separate form for each tanker or barge 
cargo loaded.
    (2) The contractor may report more than one barge in the same tow on 
a single form if on the same contract and consigned to the same 
destination.
    (3) When liftings involve more than one contract, prepare separate 
forms to cover the portion of cargo loaded on each contract.
    (4) Prepare a separate form for each product or grade of product 
loaded.
    (5) Use a separate document for each tanker or barge cargo and each 
grade of product discharged.
    (6) For discharge, the contractor may report more than one barge in 
the same tow on a single form if from the same loading source.
F-105  Forms.
    (a) Contractors may get MIRR forms from the contract administration 
office at no cost.
    (b) Contractors may print forms provided that the format and 
dimensions (DD Forms 250 and 250c: 8 1/2 inches x 11 inches, DD Form 
250-1: 8 1/2 inches x 14 inches) are identical to the MIRR forms printed 
by the Government and that the forms are cast to provide for 78 
characters per printed image horizontally and 62 lines vertically border 
to border for the DD Form 250, and 61 lines vertically border to border 
for the DD Form 250c.

     Part 2--Contract Quality Assurance (CQA) on Shipments Between 
                               Contractors

F-201  Instructions.
    (a) Use the supplier's commercial shipping document/packing list to 
enter performance of required CQA actions at subcontract level. Make the 
following entries on the supplier's commercial shipping document/packing 
list:
    Required CQA of listed items has been performed.
 _______________________________________________________________________
(Signature of Authorized Govt. Rep. or DoD Stamp)
 _______________________________________________________________________
(Date)
 _______________________________________________________________________
(Typed Name and Office)
    (b) Distribution for Government purposes shall be--
    (1) One copy with shipment;
    (2) One copy for the Government representative at consignee (via 
mail); and
    (3) One copy for the Government representative at consignor.

[[Page 622]]

         Part 3--Preparation of the DD Form 250 and DD Form 250c

F-301  Preparation instructions.
    (a) General.
    (1) Dates shall use seven spaces consisting of the last two digits 
of the year, three alphabetic month abbreviation, and two digits for the 
day. For example, 90AUG07, 90SEP24.
    (2) Addresses shall consist of the name, street address/P.O. box, 
city, state, and ZIP code.
    (3) Enter to the right of and on the same line as the word ``Code'' 
in Blocks 9 through 12 and in Block 14--(i) The Commercial and 
Government Entity Handbook (H4/H8) code,
    (ii) DoD Activity Address Directory (DODAAD) code, or
    (iii) The Military Assistance Program Address Directory (MAPAD) 
code.
    (4) Enter the DODAAD, CAGE (H4/H8), or MAPAD code in Block 13.
    (5) The data entered in the blocks at the top of the DD Form 250c 
must be identical to the comparable entries in Blocks 1, 2, 3, and 6 of 
the DD Form 250.
    (6) Enter overflow data from the DD Form 250 in Block 16 or in the 
body of the DD Form 250c with an appropriate cross reference. Do not 
number or distribute additional DD Form 250c sheets, solely for 
continuation of Block 23 data as part of the MIRR.
    (7) Do not include classified information in the MIRR. MIRRs shall 
not be classified.
    (b) Completion instructions--
    (1) Block 1--Proc instrument iden (contract).
    (i) Enter the 13 position alpha-numeric basic Procurement Instrument 
Identification Number (PIIN) of the contract. When applicable, enter the 
four alpha-numeric call/order serial number which is supplementary to 
the 13 position basic PIIN. This number is also referred to as the 
Supplementary Procurement Instrument Identification Number (SPIIN). Use 
SPIINs for (also see 204.70)--
    (A) Delivery orders under indefinite delivery type contracts;
    (B) Orders under basic ordering agreements; and
    (C) Calls under blanket purchase agreements.
    (ii) Except as indicated in paragraph (iii), do not enter 
supplementary numbers used in conjunction with basic PIINs to identify--
    (A) Modifications of contracts and agreements;
    (B) Modifications to calls/orders; or
    (C) Document numbers representing contracts written between 
contractors.
    (iii) When shipping instructions are furnished by telephone or TWX 
message and shipment is made before receipt of the confirming contract 
modification (SF 30, Amendment of Solicitation /Modification of 
Contract), enter the contract modification six digit number or the two 
digit call or order number immediately following the PIIN or call/order 
four digit SPIIN.
    (iv) For DoD delivery orders on non-DoD contracts, enter the non-DoD 
contract number immediately below the PII number.

                                                                        
------------------------------------------------------------------------
    1. Proc instrument iden (contract)               (Order) No.        
------------------------------------------------------------------------
DSA400-90-F-1684..........................                              
GS-000S-61917.............................                              
------------------------------------------------------------------------

    (v) When a contract number other than PII number is used, enter that 
contract number.
    (2) Block 2--Shipment No. (i) The shipment number has a three alpha 
character prefix and a four numeric or alpha-numeric serial number.
    (A) The prime contractor shall control and assign the shipment 
number prefix. The shipment number shall consist of three alphabetic 
characters for each ``Shipped From'' address (Block 11). The shipment 
number prefix shall be different for each ``Shipped From'' address and 
shall remain constant throughout the life of the contract. The prime 
contractor may assign separate prefixes when shipments are made from 
different locations within a facility identified by one ``Shipped From'' 
address.
    (B) Number the first shipment 0001 for shipments made under the 
contract or contract and order number shown in Block 1 from each 
``Shipped From'' address, or shipping location within the ``Shipped 
From'' address. Consecutively number all subsequent shipments with the 
identical shipment number prefix.
    (1) Use alpha-numeric serial numbers when more than 9,999 numbers 
are required. Serially assign alpha-numeric numbers with the alpha in 
the first position (the letters I and O shall not be used) followed by 
the three position numeric serial number. Use the following alpha-
numeric sequence:

    A000 through A999 (10,000 through 10,999)
    B000 through B999 (11,000 through 11,999)
    Z000 through Z999 (34,000 through 34,999)

    (2) When this series is completely used, start over with 0001.
    (ii) Reassign the shipment number of the initial shipment where a 
``Replacement Shipment'' is involved (Block 16(d)(6)).
    (iii) The prime contractor shall control deliveries and on the final 
shipment of the contract shall end the shipment number with a ``Z.'' 
Where the final shipment is from other than the prime contractor's 
plant, the prime contractor may elect either to:
    (A) Direct the subcontractor making the final shipment to end that 
shipment number with a ``Z''; or
    (B) Upon determination that all subcontractors have completed their 
shipments, to correct the DD Form 250 (see F-305) covering the final 
shipment made from the prime

[[Page 623]]

contractor's plant by addition of a ``Z'' to that shipment number.
    (iv) Contractors follow the procedures in F-306 to use commercial 
invoices.
    (3) Block 3--Date Shipped. Enter the date the shipment is released 
to the carrier or the date the services are completed. If the shipment 
will be released after the date of CQA and/or acceptance, enter the 
estimated date of release. When the date is estimated, enter an ``E'' 
after the date. Do not delay distribution of the MIRR for entry of the 
actual shipping date. Reissuance of the MIRR is not required to show the 
actual shipping date.
    (4) Block 4--B/L TCN. When applicable, enter--
    (i) The commercial or Government bill of lading number after ``B/
L;''
    (ii) The transportation control number after ``TCN'' (when a TCN is 
assigned for each line item on the DD Form 250 under Block 16 
instructions, insert ``See Block 16''); and
    (iii) The initial (line haul) mode of shipment code in the lower 
right corner of the block (see F-302).
    (5) Block 5--Discount Terms. (i) The contractor may enter the 
discount in terms of percentages on all copies of the MIRR.
    (ii) Use the procedures in F-306 when the MIRR is used as an 
invoice.
    (6) Block 6--Invoice No./date. (i) The contractor may enter the 
invoice number and actual or estimated date of invoice submission on all 
copies of the MIRR. When the date is estimated, enter an ``E'' after the 
date. Do not correct MIRRs other than invoice copies to reflect the 
actual date of invoice submission.
    (ii) Use the procedures in F-306 when the MIRR is used as an 
invoice.
    (7) Block 7--Page/of.
    Consecutively number the pages of the MIRR. On each page enter the 
total number of pages of the MIRR.
    (8) Block 8--Acceptance point.
    Enter an ``S'' for Origin or ``D'' for destination.
    (9) Block 9--Prime contractor/code.
    Enter the code and address.
    (10) Block 10--Administered by/code.
    Enter the code and address of the contract administration office 
(CAO) cited in the contract.
    (11) Block 11--Shipped from/code/FOB.
    (i) Enter the code and address of the ``Shipped From'' location. If 
identical to Block 9, enter ``See Block 9.''
    (ii) For performance of services line items which do not require 
delivery of items upon completion of services, enter the code and 
address of the location at which the services were performed. If the DD 
Form 250 covers performance at multiple locations, or if identical to 
Block 9, enter ``See Block 9.''
    (iii) Enter on the same line and to the right of ``FOB'' an ``S'' 
for Origin or ``D'' for Destination as specified in the contract. Enter 
an alphabetic ``O'' if the ``FOB'' point cited in the contract is other 
than origin or destination.
    (iv) For destination or origin acceptance shipments involving 
discount terms, enter ``DISCOUNT EXPEDITE'' in at least one-half inch 
outline-type style letters across Blocks 11 and 12. Do not obliterate 
other information in these blocks.
    (12) Block 12--Payment will be made by/code. Enter the code and 
address of the payment office cited in the contract.
    (13) Block 13--Shipped to/code. Enter the code and address from the 
contract or shipping instructions.
    (14) Block 14--Marked for/code. Enter the code and address from the 
contract or shipping instructions. When three-character project codes 
are provided in the contract or shipping instructions, enter the code in 
the body of the block, prefixed by ``Proj''; do not enter in the code 
block.
    (15) Block 15--Item No. Enter the item number used in the contract.
    (i) Use item numbers under the Uniform Contract Line Item Numbering 
System (see 204.71).
    (ii) Position the item numbers as follows--
    (A) For item numbers with four or less digits, enter the number 
immediately to the left of the vertical dashed line and prefix them with 
zeros, to achieve four digits.
    (B) For item numbers with six digits, with alpha digits in the final 
two positions, enter the last two digits to the right of the vertical 
dashed line.
    (C) For item numbers with six digits, with numbers in the final two 
positions, enter the first four digits immediately to the left of the 
vertical dashed line. Do not use the last two digits.
    (iii) Line item numbers not in accordance with the Uniform Contract 
Line Item Numbering System may be entered without regard to positioning.
    (16) Block 16--Stock/part No./description. (i) Use single or double 
spacing between line items when there are less than four line items. Use 
double spacing when there are four or more line items. Enter the 
following for each line item:
    (A) The national stock number (NSN) or noncatalog number. Where 
applicable, include a prefix or suffix. If a number is not provided, or 
it is necessary to supplement the number, include other identification 
such as the manufacturer's name or federal supply code (as published in 
Cataloging Handbook H4-1), and the part number. Show additional part 
numbers in parentheses or slashes. Show the descriptive noun of the item 
nomenclature and if provided, the Government assigned management/
material control code. The contractor may use the following technique in 
the case of equal kind

[[Page 624]]

supply items. The first entry shall be the description without regard to 
kind. For example, ``Shoe-Low Quarter-Black,'' ``Resistor,'' ``Vacuum 
Tube,'' etc. Below this description, enter the contract line item number 
in Block 15 and Stock/Part number followed by the size or type in Block 
16.
    (B) On the next printing line, if required by the contract for 
control purposes, enter: the make, model, serial number, lot, batch, 
hazard indicator, or similar description.
    (C) On the next printing lines enter--
    (1) The MIPR number prefixed by ``MIPR'' or the MILSTRIP requisition 
number(s) when provided in the contract; or
    (2) Shipping instructions followed on the same line (when more than 
one requisition is entered) by the unit for payment and the quantity 
shipped against each requisition.

Example:
    V04696-185-750XY19059A--EA 5
    N0018801776038XY3211BA--EA 200
    AT650803050051AAT6391J--EA 1000

    (D) When a TCN is assigned for each line item, enter on the next 
line the transportation control number prefixed by ``TCN.''
    (ii) For service line items, enter the word ``SERVICE'' followed by 
as short a description as is possible in no more than 20 additional 
characters. Some examples of service line items are maintenance, repair, 
alteration, rehabilitation, engineering, research, development, 
training, and testing. Do not complete Blocks 4, 13, and 14 when there 
is no shipment of material.
    (iii) For all contracts administered by Defense Contract Management 
Command, with the exception of fast pay procedures, enter and complete 
the following:

    Gross Shipping Wt. ____________
    State weight in pounds only.

    (iv) Starting with the next line, enter the following as appropriate 
(entries may be extended through Block 20). When entries apply to more 
than one line item in the MIRR, enter them only once after the last line 
item entry. Reference applicable line item numbers.
    (A) Enter in capital letters any special handling instructions/
limits for material environmental control, such as temperature, 
humidity, aging, freezing, shock, etc.
    (B) When a shipment is chargeable to Navy appropriation 17X4911, 
enter the appropriation, bureau control number (BCN), and authorization 
accounting activity (AAA) number (e.g., 17X4911-14003-104).
    (C) When the Navy transaction type code (TC), ``2T'' or ``7T'' is 
included in the appropriation data, enter ``TC 2T'' or ``TC 7T.''
    (D) When an NSN is required by but not cited in a contract and has 
not been furnished by the Government, the contractor may make shipment 
without the NSN at the direction of the contracting officer. Enter the 
authority for such shipment.
    (E) When Government furnished property (GFP) is included with or 
incorporated into the line item, enter the letters ``GFP.''
    (F) When shipment consists of replacements for supplies previously 
furnished, enter in capital letters ``REPLACEMENT SHIPMENT.'' (See F-
301, Block 17, for replacement indicators).
    (G) On shipments of Government furnished aeronautical equipment 
(GFAE) under Air Force contracts, enter the assignment AERNO control 
number, e.g., ``AERNO 60-6354.''
    (H) For items shipped with missing components, enter and complete 
the following:
    ``Item(s) shipped short of the following component(s): NSN or 
comparable identification ____________, Quantity ____________, Estimated 
Value ____________, Authority ____________''
    (I) When shipment is made of components which were short on a prior 
shipment, enter and complete the following:
    ``These components were listed as shortages on shipment number 
____________, date shipped ____________''
    (J) When shipments involve drums, cylinders, reels, containers, 
skids, etc., designated as returnable under contract provisions, enter 
and complete the following:
    ``Return to ____________, Quantity ____________, Item ____________, 
Ownership (Government/contractor).''
    (K) Enter the total number of shipping containers, the type of 
containers, and the container number(s) assigned for the shipment.
    (L) On foreign military sales (FMS) shipments, enter the special 
markings, and FMS case identifier from the contract. Also enter the 
gross weight.
    (M) When test/evaluation results are a condition of acceptance and 
are not available prior to shipment, the following note shall be entered 
if the shipment is approved by the contracting officer:

    ``Note: Acceptance and payment are contingent upon receipt of 
approved test/evaluation results.''

    The contracting officer will advise--
    (1) The consignee of the results (approval/disapproval); and
    (2) The contractor to withhold invoicing pending attachment of the 
approved test/evaluation results.
    (N) The copy of the DD Form 250 required to support payment for 
destination acceptance (top copy of those with shipment) or ARP origin 
acceptance shall be identified as follows: enter ``PAYMENT COPY'' in 
approximately one-half inch outline type style letters with ``FORWARD TO 
BLOCK 12 ADDRESS'' in approximately one-quarter inch

[[Page 625]]

letters immediately below. Do not obliterate any other entries.
    (O) For clothing and textile contracts containing a bailment clause, 
enter the words ``GFP UNIT VALUE.''
    (P) When the initial unit incorporating an approved value 
engineering change proposal (VECP) is shipped, enter the following 
statement:
    This is the initial unit delivered which incorporates VECP No. 
____________, Contract Modification No. ____________, dated ____________
    (17) Block 17--Quantity shipped/received. (i) Enter the quantity 
shipped, using the unit of measure in the contract for payment. When a 
second unit of measure is used for purposes other than payment, enter 
the appropriate quantity directly below in parentheses.
    (ii) On the final shipment of a line item of a contract containing a 
clause permitting a variation of quantity and an underrun condition 
exists, the prime contractor shall enter a ``Z'' below the last digit of 
the quantity. Where the final shipment is from other than the prime 
contractor's plant and an underrun condition exists, the prime 
contractor may elect either to--
    (A) Direct the subcontractor making the final shipment to enter a 
``Z'' below the quantity; or
    (B) Upon determination that all subcontractors have completed their 
shipments, correct the DD Form 250 (see F-305) covering the final 
shipment of the line item from the prime contractor's plant by addition 
of a ``Z'' below the quantity. Do not use the ``Z'' on deliveries which 
equal or exceed the contract line item quantity.
    (iii) For replacement shipments, enter ``A'' below the last digit of 
the quantity, to designate first replacement, ``B'' for second 
replacement, etc. Do not use the final shipment indicator ``Z'' on 
underrun deliveries when a final line item shipment is replaced.

                                                                        
                                                                        
                                                                         
                              17. Quantity                              
                               Ship/rec'd                               
                                  1000                                  
                                  (10)                                  
                                    Z                                   
                                                                        

    (iv) If the quantity received is the same quantity shipped and all 
items are in apparent good condition, enter by a check mark. If 
different, enter actual quantity received in apparent good condition 
below quantity shipped and circle. The receiving activity will annotate 
the DD Form 250 stating the reason for the difference.
    (18) Block 18--Unit. Enter the abbreviation of the unit measure as 
indicated in the contract for payment. Where a second unit of measure is 
indicated in the contract for purposes other than payment or used for 
shipping purposes, enter the second unit of measure directly below in 
parentheses. Authorized abbreviations are listed in MIL-STD-129, Marking 
for Shipping and Storage. For example, LB for pound, SH for sheet.

                                                                        
                                                                        
                                                                         
                                18. Unit                                
                                   LB                                   
                                  (SH)                                  
                                                                        

    (19) Block 19--Unit price. The contractor may, at its option, enter 
unit prices on all MIRR copies, except as a minimum:
    (i) The contractor shall enter unit prices on all MIRR copies for 
each item of property fabricated or acquired for the Government and 
delivered to a contractor as Government furnished property (GFP). Get 
the unit price from Section B of the contract. If the unit price is not 
available, use an estimate. The estimated price should be the 
contractor's estimate of what the items will cost the Government. When 
the price is estimated, enter an ``E'' after the unit price.
    (ii) Use the procedures in F-306 when the MIRR is used as an 
invoice.
    (iii) For clothing and textile contracts containing a bailment 
clause, enter the cited Government furnished property unit value 
opposite ``GFP UNIT VALUE'' entry in Block 16.
    (iv) Price all copies of DD Forms 250 for FMS shipments with actual 
prices, if available. If actual prices are not available, use estimated 
prices. When the price is estimated, enter an ``E'' after the price.
    (20) Block 20--Amount. Enter the extended amount when the unit price 
is entered in Block 19.
    (21) Block 21--Contract quality assurance (CQA). (i) The words 
``conform to contract'' contained in the printed statements in Blocks A 
and B relate to quality and to the quantity of the items on the report. 
Do not modify the statements. Enter notes taking exception in Block 16 
or on attached supporting documents with an appropriate block cross 
reference.
    (ii) When a shipment is authorized under alternative release 
procedure, attach or include the appropriate contractor signed 
certificate on the top copy of the DD Form 250 copies distributed to the 
payment office or attach or include the appropriate contractor 
certificate on the contract administration office copy when contract 
administration (Block 10 of the DD Form 250) is performed by the Defense 
Contract Management Command (DCMC).
    (iii) When contract terms provide for use of Certificate of 
Conformance and shipment is made under these terms, the contractor shall 
enter ``Certificate of Conformance'' in Block 21A on the next line 
following the CQA and acceptance statements. Attach or include the 
appropriate contractor signed certificate on the top copy of the DD Form 
250 copies distributed to the payment office or attach

[[Page 626]]

or include the appropriate certificate on the contract administration 
office copy when contract administration (Block 10 of the DD Form 250) 
is performed by DCMC. In addition, attach a copy of the signed 
certificate to, or enter on, copies of the MIRR sent with shipment.
    (iv) Origin. (A) The authorized Government representative shall--
    (1) Place an ``X'' in the appropriate CQA and/or acceptance box(es) 
to show origin CQA and/or acceptance. When the contract requires CQA at 
destination in addition to origin CQA, enter an asterisk at the end of 
the statement and an explanatory note in Block 16;
    (2) Sign and date;
    (3) Enter the typed, stamped, or printed name and office DODAAD 
code.
    (B) When alternative release procedures apply--
    (1) The contractor or subcontractor shall complete the entries 
required under paragraph (A) and enter in capital letters ``ALTERNATIVE 
RELEASE PROCEDURE'' on the next line following the printed CQA/
acceptance statement.
    (2) When acceptance is at origin and contract administration is 
performed by an office other than DCMC, the contractor shall furnish the 
four payment office copies of the MIRR to the authorized Government 
representative for dating and signing of one copy and forwarding of all 
copies to the payment office.
    (3) When acceptance is at origin and contract administration is 
performed by DCMC, furnish the contract administration office copy of 
the MIRR to the authorized Government representative for dating and 
signing and forwarding to the contract administration office (see F-401, 
Table 1).
    (C) When fast pay procedures apply, the contractor or subcontractor 
shall enter in capital letters ``FAST PAY'' on the next line following 
the printed CQA/acceptance statement. When CQA is required, the 
authorized Government representative shall execute the block as required 
by paragraph (A).
    (D) When Certificate of Conformance procedures apply, inspection or 
inspection and acceptance are at source, and the contractor's 
Certificate of Conformance is required, the contractor shall make 
entries required by paragraph (iv)(A).
    (1) For contracts administered by an office other than DCMC, furnish 
the four payment office copies of the MIRR to the authorized Government 
representative for dating and signing of one copy, and forwarding of all 
copies to the payment office.
    (2) For contracts administered by DCMC, furnish the contract 
administration office copy of the MIRR to the authorized Government 
representative for dating and signing and forwarding to the contract 
administration office (see F-401, Table 1).
    (3) When acceptance is at destination, no entry shall be made other 
than ``CERTIFICATE OF CONFORMANCE.''
    (v) Destination. (A) When acceptance at origin is indicated in Block 
21A, no entries shall be made in Block 21B.
    (B) When CQA and acceptance or acceptance is at destination, the 
authorized Government representative shall--
    (1) Place an ``X'' in the appropriate box(es);
    (2) Sign and date; and
    (3) Enter typed, stamped, or printed name and title.
    (C) When ``ALTERNATIVE RELEASE PROCEDURE'' is entered in Block 21A 
and acceptance is at destination, the authorized Government 
representative shall complete the entries required by paragraph (B).
    (D) Forward the executed payment copy or MILSCAP format identifier 
PKN or PKP to the payment office cited in Block 12 within 4 work days (5 
days when MILSCAP Format is used) after delivery and acceptance of the 
shipment by the receiving activity. Forward one executed copy of the 
final DD Form 250 to the contract administration office cited in Block 
10 for implementing contract closeout procedures, except where a Defense 
Contract Management Region or the DLA Finance Center is cited as the 
payment office in Block 12.
    (E) When ``FAST PAY'' is entered in Block 21A, make no entries in 
this block.
    (22) Block 22--Receiver's use. The receiving activity (Government or 
contractor) shall use this block to show receipt, quantity, and 
condition. The receiving activity shall enter the date the supplies 
arrived. For example, when off-loading or in-checking occurs subsequent 
to the day of arrival of the carrier at the installation, the date of 
the carrier's arrival is the date received for purposes of this block.
    (23) Block 23--Contractor use only. Self explanatory.
F-302  Mode/method of shipment codes.

                                                                        
------------------------------------------------------------------------
              Code                             Description              
------------------------------------------------------------------------
               A                 Motor, truckload.                      
               B                 Motor, less than truckload.            
               C                 Van (unpacked, uncrated personal or    
                                  Government property).                 
               D                 Driveaway, truckaway, towaway.         
               E                 Bus.                                   
               F                 Air Mobility Command (Channel and      
                                  Special Assignment Airlift Mission).  
               G                 Surface parcel post.                   
               H                 Air parcel post.                       
               I                 Government trucks, for shipment outside
                                  local delivery area.                  
               J                 Air, small package carrier.            
               K                 Rail, carload.\1\                      
               L                 Rail, less than carload.\1\            
               M                 Surface, freight forwarder.            
               N                 LOGAIR.                                
               O                 Organic military air (including        
                                  aircraft of foreign governments).     

[[Page 627]]

                                                                        
               P                 Through Government Bill of Lading      
                                  (TGBL).                               
               Q                 Commercial air freight (includes       
                                  regular and expedited service provided
                                  by major airlines; charters and air   
                                  taxis).                               
               R                 European Distribution System or Pacific
                                  Distribution System.                  
               S                 Scheduled Truck Service (STS) (applies 
                                  to contract carriage, guaranteed      
                                  traffic routings and/or scheduled     
                                  service).                             
               T                 Air freight forwarder.                 
               U                 QUICKTRANS.                            
               V                 SEAVAN.                                
               W                 Water, river, lake, coastal            
                                  (commercial).                         
               X                 Bearer, walk-thru (customer pickup of  
                                  material).                            
               Y                 Military Intratheater Airlift Service. 
               Z                 Military Sealift Command (MSC)         
                                  (controlled contract or arranged      
                                  space).                               
               2                 Government watercraft, barge, lighter. 
               3                 Roll-on Roll-off (RORO) service.       
               4                 Armed Forces Courier Service (ARFCOS). 
               5                 Surface, small package carrier.        
               6                 Military official mail (MOM).          
               7                 Express mail.                          
               8                 Pipeline.                              
               9                 Local delivery by Government or        
                                  commercial truck (includes on base    
                                  transfers; deliveries between air,    
                                  water, or motor terminals; and        
                                  adjacent activities). Local delivery  
                                  areas are identified in commercial    
                                  carriers' tariffs which are filed and 
                                  approved by regulatory authorities.   
------------------------------------------------------------------------
\1\ Includes trailer/container-on-flat-car (excluding SEAVAN).          

F-303  Consolidated shipments.
    When individual shipments are held at the contractor's plant for 
authorized transportation consolidation to a single bill of lading, the 
contractor may prepare the DD Forms 250 at the time of CQA or acceptance 
prior to the time of actual shipment (see Block 3).
F-304  Multiple consignee instructions.
    The contractor may prepare one MIRR when the identical line item(s) 
of a contract are to be shipped to more than one consignee, with the 
same or varying quantities, and the shipment requires origin acceptance. 
Prepare the MIRR using the procedures in this appendix with the 
following changes--
    (a) Blocks 2, 4, 13, and, if applicable, 14--Enter ``See Attached 
Distribution List.''
    (b) Block 15--The contractor may group item numbers for identical 
stock/part number and description.
    (c) Block 17--Enter the ``total'' quantity shipped by line item or, 
if applicable, grouped identical line items.
    (d) Use the DD Form 250c to list each individual ``Shipped To'' and 
``Marked For'' with--
    (1) Code(s) and complete shipping address and a sequential shipment 
number for each;
    (2) Line item number(s);
    (3) Quantity;
    (4) MIPR number(s), preceded by ``MIPR,'' or the MILSTRIP 
requisition number, and quantity for each when provided in the contract 
or shipping instructions; and
    (5) If applicable, bill of lading number, TCN, and mode of shipment 
code.
    (e) The contractor may omit those distribution list pages of the DD 
Form 250c that are not applicable to the consignee. Provide a complete 
MIRR for all other distribution.
F-305  Correction instructions.
    Make a new revised MIRR or correct the original when, because of 
errors or omissions, it is necessary to correct the MIRR after 
distribution has been made. Use data identical to that of the original 
MIRR. Do not correct MIRRs for Blocks 19 and 20 entries. Make the 
corrections as follows--
    (a) Circle the error and place the corrected information in the same 
block; if space is limited, enter the corrected information in Block 16 
referencing the error page and block. Enter omissions in Block 16 
referencing omission page and block. For example--

                                                                        
                                                                        
                                                                         
                             2. SHIPMENT NO.                            
                                (AAA0001)                               
                              See Block 16                              
                                                                        


                                                                        
                                                                        
                                                                         
                              17. QUANTITY                              
                               SHIP/REC'D                               
                                   19                                   
                                  (17)                                  
                                                                        


                                                                        
                                                                        
                                                                         
                     16. STOCK/PART NO. DESCRIPTION                     
                              CORRECTIONS:                              
Refer Block 2: Change shipment No. AAA001 to AAA0010 on all pages of the
 MIRR.                                                                  
Refer Blocks 15, 16, 17, and 18, page 2: Delete in entirety Line Item   
 No. 0006. This item was not shipped.                                   
                                                                        

    (b) When corrections have been made to entries for line items (Block 
15) or quantity (Block 17) enter the words ``CORRECTIONS HAVE BEEN 
VERIFIED'' on page 1. The authorized Government representative will date 
and sign immediately below the statement. This verification statement 
and signature are not required for other corrections.
    (c) Clearly mark the pages of the MIRR requiring correction with the 
words ``CORRECTED COPY.'' Avoid obliterating any other entries. Where 
corrections are made only on continuation sheets, also mark page number 
1 with the words ``CORRECTED COPY.''
    (d) Page 1 and only those continuation pages marked ``CORRECTED 
COPY'' shall be distributed to the initial distribution. A complete MIRR 
with corrections shall be distributed to new addressee(s) created by 
error corrections.
F-306  Invoice instructions.
    The Government encourages, but does not require, contractors to use 
copies of the MIRR as an invoice, in lieu of a commercial

[[Page 628]]

form. If commercial forms are used, identify the related MIRR shipment 
number(s) on the form. If using the MIRR as an invoice, prepare and 
forward four copies to the payment office as follows--
    (a) Complete Blocks 5, 6, 19, and 20. Block 6 shall contain the 
invoice number and date. Column 20 shall be totaled.
    (b) Mark in letters approximately one inch high, first copy: 
``ORIGINAL INVOICE;'' three copies ``INVOICE COPY.''
    (c) Forward the four copies to the payment office (Block 12 
address), except when acceptance is at destination and a Navy finance 
office will make payment, forward to destination.
    (d) Be sure to separate the four copies of the MIRR used as an 
invoice from the copies the MIRR used as a receiving report.
F-307  Packing list instructions.
    Contractors may use copies of the MIRR as a packing list. The 
packing list copies are in addition to the copies of the MIRR required 
for standard distribution (see F-401). Mark them ``PACKING LIST.''
F-308  Receiving instructions.
    When the MIRR is used for receiving purposes, local directives shall 
prescribe procedures. If CQA and acceptance or acceptance of supplies is 
required upon arrival at destination, see Block 21B for instructions.

          Part 4--Distribution of DD Form 250 and DD Form 250c

F-401  Distribution.
    (a) The contractor is responsible for distributing the DD Form 250, 
including mailing and payment of postage.
    (b) Contractors shall distribute MIRRs using the instructions in 
Tables 1 and 2.
    (c) Contractors shall distribute MIRRs on non-DoD contracts using 
this appendix as amended by the contract.
    (d) Contractors shall make distribution promptly, but no later than 
the close of business of the work day following--
    (1) Signing of the DD Form 250 (Block 21A) by the authorized 
Government representative; or
    (2) Shipment when authorized under terms of alternative release, 
certificate of conformance, or fast pay procedures; or
    (3) Shipment when CQA and acceptance are to be performed at 
destination.
    (e) Do not send the consignee copies (via mail) on overseas 
shipments to port of embarkation (POE). Send them to consignee at APO/
FPO address.
    (f) Copies of the MIRR forwarded to a location for more than one 
recipient shall clearly identify each recipient.

                Material Inspection and Receiving Report

                     Table 1--Standard Distribution

With Shipment*.........................................................2
Consignee (via mail)...................................................1
    (For Navy procurement, include unit price)
    (For foreign military sales, consignee copies are not required)
Contract Administration Office.........................................1
    (Forward direct to address in Block 10 except when addressee is a 
DCMD, DCMAO, or a DPRO and a certificate of conformance or the alternate 
release procedures (see F-301, Block 21) is involved, and acceptance is 
at origin; then, forward through the authorized Government 
representative.)
Purchasing Office......................................................1
Payment Office**.......................................................2
(Forward direct to address in Block 12 except--
    (i) When address in Block 10 is a DCMD or DCMAO and payment office 
in Block 12 is the Defense Finance and Accounting Service, Columbus 
Center, do not make distribution to the Block 12 addressee;
    (ii) When address in Block 12 is the Defense Finance and Accounting 
Service, Columbus Center/Albuquerque Office (DFAS-CO/ALQ), Kirtland AFB, 
NM, attach only one copy to the required number of copies of the 
contractor's invoice;
    (iii) When acceptance is at destination and a Navy finance office 
will make payment, forward to destination; and
    (iv) When a certificate of conformance or the alternative release 
procedures (see F-301, Block 21) are involved and acceptance is at 
origin, forward the copies through the authorized Government 
representative.
ADP Point for CAO (applicable to Air Force only).......................1
    (When DFAS-CO/ALQ is the payment office in Block 12, send one copy 
to DFAS-CO/ALQ immediately after signature. If submission of delivery 
data is made electronically, distribution of this hard copy need not be 
made to DFAS-CO/ALQ.)
CAO of Contractor Receiving GFP........................................1
    (For items fabricated or acquired for the Government and shipped to 
a contractor as Government furnished property, send one copy directly to 
the CAO cognizant of the receiving contractor, ATTN: Property 
Administrator (see DoD 4105.59-H).)
    *Attached as follows:

                                                                        
------------------------------------------------------------------------
             Type of shipment                         Location          
------------------------------------------------------------------------
Carload or truckload......................  Affix to the shipment where 
                                             it will be readily visible 
                                             and available upon receipt.
Less than carload or truckload............  Affix to container number   
                                             one or container bearing   
                                             lowest number.             

[[Page 629]]

                                                                        
Mail, including parcel post...............  Attach to outside or include
                                             in the package. Include a  
                                             copy in each additional    
                                             package of multi-package   
                                             shipments.                 
Pipeline, tank car, or railroad cars for    Forward with consignee      
 coal movements.                             copies.                    
------------------------------------------------------------------------
** Payment by Defense Finance and Accounting Service, Columbus Center   
  will be based on the source acceptance copies of DD Forms 250         
  forwarded to the contract administration office.                      

                Material Inspection And Receiving Report

                                          Table 2--Special Distribution                                         
----------------------------------------------------------------------------------------------------------------
               As required                            Address                         Number of copies          
----------------------------------------------------------------------------------------------------------------
Each: Navy Status Control Activity,       Address specified in contract..  1 Each addressee.                    
 Army, Air Force, DLA Inventory Control                                                                         
 Manager.                                                                                                       
Quality Assurance Representative........  Address specified by the         1                                    
                                           assigned quality assurance                                           
                                           representative.                                                      
Transportation Office issuing GBL         CAO address unless otherwise     1                                    
 (attach to GBL memorandum copy).          specified in the contract.                                           
Purchasing Office other than office       Address specified in the         1                                    
 issuing contract.                         contract.                                                            
Foreign Military Sales Representative...  Address specified in the         8                                    
                                           contract.                                                            
Military Assistance Advisory Group        U.S. Military Advisory Group,    1                                    
 (Grant Aid shipments).                    Military Attache, Mission, or                                        
                                           other designated agency                                              
                                           address as specified in the                                          
                                           contract.                                                            
Army:                                                                                                           
    Foreign Military Sales..............  Commander, US Army, Security     .....................................
                                           Asst. Center, ATTN: AMSAC-OL-                                        
                                           LS-CS, 3rd Street and ``M''                                          
                                           Avenue, New Cumberland Army                                          
                                           Depot, New Cumberland, PA                                            
                                           17070-5096.                                                          
* Director, AMSAC-OE for these country    AG, AU, A2, AID, BC, BE, BY,                                          
 codes.                                    CD, CI, CM, CN, CV, CX, DA,                                          
                                           DE, DK, EG, EI, FI, FR, GA,                                          
                                           GB, GH, GR, GV, GY, IS, IT,                                          
                                           IV, KE, LI, LX, MI, MO, MR,                                          
                                           NE, NI, NK, NO, NATO, PT, PU,                                        
                                           RM, RW, SK, SL, SO, SP, SU,                                          
                                           SW, SZ, SECPO, TK, TO, TU, UG,                                       
                                           UK, UV.                                                              
* Director, AMSAC-OX for these country    AC, AR, AT, A1, BA, BB, BD, BF,                                       
 codes.                                    BG, BH, BL, BM, BR, BX, CB,                                          
                                           CE, CH, CO, CS, DO, DR, EC,                                          
                                           ES, FJ, GJ, GT, GU, HA, HO,                                          
                                           ID, IN, IR, JA, JM, JO, KS,                                          
                                           KU, LE, MF, MU, MX, NP, NU,                                          
                                           NS, NZ, PA, PE, PI, PK, PN,                                          
                                           PP, QA, SC, SI, SN, SR, ST,                                          
                                           TC, TD, TH, TW, UY, VC, VE, YE.                                      
Air Force:                                                                                                      
    On shipments of new production of     HQ Air Force Materiel Command    1                                    
     aircraft and missiles, class 1410     AFMC/LGM-AVDO, 4375 Chidlaw                                          
     missiles, 1510 aircraft (fixed        Road, Suite 6, Wright-                                               
     wing, all types), 1520 aircraft       Patterson AFB, OH 45433-5001.                                        
     (rotary wing), 1540 gliders, 1550                                                                          
     target drones.                                                                                             
Navy:                                                                                                           
    Navy Foreign Military Sales.........  U.S. Navy International          2                                    
                                           Logistics Control Office                                             
                                           (NAVILCO), 700 Robbins Avenue,                                       
                                           Philadelphia, PA 19111-5095.                                         
    When typed code (TC) 2T or 7T is      Aviation Supply Office (ASO),    2                                    
     shown in Block 16, or when shipment   (Code 0142) for aviation type                                        
     is consigned to another               material, 700 Robbins Avenue,                                        
     contractor's plant for a Government   Philadelphia, PA 19111-5098.    2                                    
     representative or when Block 16          and........................                                       
     indicates shipment includes GFP.     Ships Parts Control Center                                            
                                           (SPCC) (Code 0143) for all                                           
                                           other material, 5450 Carlisle                                        
                                           Pike, PO Box 2020,                                                   
                                           Mechanicsburg, PA 17055-0788.                                        
Marine Corps:                                                                                                   
    All shipments consigned to a Marine   Commandant of the Marine Corps,  1                                    
     Corps Activity (excluding             Headquarters, USMC,                                                  
     aeronautical spares).                 Washington, DC 20380-0001.                                           
                                          Commanding General, Marine       3                                    
                                           Corps Logistics Base, Albany,                                        
                                           GA 31704-5000.                                                       

[[Page 630]]

                                                                                                                
    Bulk Petroleum Shipments............  Cognizant Defense Fuel Region    1                                    
                                           (see Table 4).                                                       
----------------------------------------------------------------------------------------------------------------

        Part 5--Preparation of the DD Form 250-1 (Loading Report)

F-501  Instructions.
    Prepare the DD Form 250-1 using the following instructions when 
applied to a tanker or barge cargo lifting. If space is limited, use 
abbreviations. The block numbers correspond to those on the form.
    (a) Block 1--Tanker/Barge. Line out ``TANKER'' or ``BARGE'' as 
appropriate and place an ``X'' to indicate loading report.
    (b) Block 2--Inspection Office. Enter the name and location of the 
Government office conducting the inspection.
    (c) Block 3--Report No. Number each form consecutively, starting 
with number 1, to correspond to the number of shipments made against the 
contract. If shipment is made from more than one location against the 
same contract, use this numbering system at each location.
    (d) Block 4--Agency Placing Order on shipper, city, State and/or 
local address (loading). Enter the applicable Government activity.
    (e) Block 5--Department. Enter military department owning product 
being shipped.
    (f) Block 6--Prime contract or P.O. No. Enter the contract or 
purchase order number.
    (g) Block 7--Name of prime contractor, city, State and/or local 
address (loading). Enter the name and address of the contractor as shown 
in the contract.
    (h) Block 8--Storage contract. Enter storage contract number if 
applicable.
    (i) Block 9--Terminal or refinery shipped from, city, State and/or 
local address. Enter the name and location of the contractor facility 
from which shipment is made. Also enter delivery point in this space as 
either ``FOB Origin'' or ``FOB Destination.''
    (j) Block 10--Order No. on supplier. Enter number of the delivery 
order, purchase order, subcontract or suborder placed on the supplier.
    (k) Block 11--Shipped to: (receiving activity, city, State and/or 
local address. Enter the name and geographical address of the consignee 
as shown on the shipping order.
    (l) Block 12--B/L Number. If applicable, enter the initials and 
number of the bill of lading. If a commercial bill of lading is later 
authorized to be converted to a Government bill of lading, show ``Com. 
B/L to GB/L.''
    (m) Block 13--Reqn. or request No. Enter number and date from the 
shipping instructions.
    (n) Block 14--Cargo No. Enter the cargo number furnished by the 
ordering office.
    (o) Block 15--Vessel. Enter the name of tanker or barge.
    (p) Block 16--Draft arrival. Enter the vessel's draft on arrival.
    (q) Block 17--Draft sailing. Enter the vessel's draft on completion 
of loading.
    (r) Block 18--Previous two cargoes. Enter the type of product 
constituting previous two cargoes.
    (s) Block 19--Prior inspection. Leave blank.
    (t) Block 20--Condition of shore pipeline. Enter condition of line 
(full or empty) before and after loading.
    (u) Block 21--Appropriation (loading). Enter the appropriation 
number shown on the contract, purchase order or distribution plan. If 
the shipment is made from departmentally owned stock, show ``Army, Navy, 
or Air Force (as appropriate) owned stock.''
    (v) Block 22--Contract item No. Enter the contract item number 
applicable to the shipment.
    (w) Block 23--Product. Enter the product nomenclature and grade as 
shown in the contract or specification, the stock or class number, and 
the NATO symbol.
    (x) Block 24--Specifications. Enter the specification and amendment 
number shown in the contract.
    (y) Block 25--Statement of quantity. Enter in the ``LOADED'' column, 
the net barrels, net gallons, and long tons for the cargo loaded. NOTE: 
If more than \1/2\ of 1 percent difference exists between the ship and 
shore quantity figures, the contractor shall immediately investigate to 
determine the cause of the difference. If necessary, prepare corrected 
documents; otherwise, put a statement in Block 28 as to the probable or 
actual cause of the difference.
    (z) Block 26--Statement of quality. (1) Under the heading ``TESTS'' 
list all inspection acceptance tests of the specification and any other 
quality requirements of the contract.
    (2) Under the heading ``SPECIFICATION LIMITS'' list the limits or 
requirements as stated in the specification or contract directly 
opposite each entry in the ``TESTS'' column. List waivers to technical 
requirements.
    (3) Under the heading ``TEST RESULTS'' list the test results 
applicable to the storage tank or tanks from which the cargo was lifted. 
If more than one storage tank is involved, list the tests applicable to 
each tank in separate columns headed by the tank

[[Page 631]]

number, the date the product in the tank was approved, and the quantity 
loaded from the tank. Each column shall also list such product 
characteristics as amount and type of corrosion inhibitor, etc.
    (aa) Block 27--Time statement. Line out ``DISCHARGE'' and 
``DISCHARGING.'' Complete all applicable entries of the time statement 
using local time. Take these dates and times from either the vessel or 
shore facility log. The Government representative shall ensure that the 
logs are in agreement on those entries used. If the vessel and shore 
facility logs are not in agreement, the Government representative will 
explain the reasons in Block 28--REMARKS. Do not enter the date and time 
the vessel left berth on documents placed aboard the vessel. The date 
and time shall appear on all other copies. Express all dates in sequence 
of day, month, and year with the month spelled out or abbreviated (e.g., 
10 Sept. 67). The term FINISHED BALLAST DISCHARGE is meant to include 
all times needed to complete deballasting and mopping/drying of ship's 
tanks. The inspection of ship's tanks for loading is normally performed 
immediately upon completion of drying tanks.
    (bb) Block 28--Remarks. Use this space for reporting--(1) All 
delays, their cause and responsible party (vessel, shore facility, 
Government representative, or other).
    (2) Details of loading abnormalities such as product losses due to 
overflow, leaks, delivery of product from low level in shore tanks, etc.
    (3) In the case of multiple consignees, enter each consignee, the 
amount consigned to each, and if applicable, the storage contract 
numbers appearing on the delivery order.
    (4) When product title is vested in the U.S. Government, insert in 
capital letters ``U.S. GOVERNMENT OWNED CARGO.'' If title to the product 
remains with the contractor and inspection is performed at source with 
acceptance at destination, insert in capital letters ``CONTRACTOR OWNED 
CARGO.''
    (5) Seal numbers and location of seals. If space is not adequate, 
place this information on the ullage report or an attached supplemental 
sheet.
    (cc) Block 29--Company or receiving terminal. Line out ``OR 
RECEIVING TERMINAL'' and get the signature of the supplier's 
representative.
    (dd) Block 30--Certification by government representative. Line out 
``DISCHARGED.'' The Government representative shall date and sign the 
form to certify inspection and acceptance, as applicable, by the 
Government. The name of the individual signing this certification, as 
well as the names applied in Blocks 29 and 31, shall be typed or hand 
lettered. The signature in Block 30 must agree with the typed or 
lettered name to be acceptable to the paying office.
    (ee) Block 31--Certification by master or agent. Obtain the 
signature of the master of the vessel or its agent.

       Part 6--Preparation of the DD form 250-1 (Discharge Report)

F-601  Instructions.
    Prepare the DD Form 250-1 using the following instructions when 
applied to a tanker or barge discharge. If space is limited, use 
abbreviations. The block numbers correspond to those on the form.
    (a) Block 1--Tanker/barge. Line out ``TANKER'' or ``BARGE'' as 
applicable and place an ``X'' to enter discharge report.
    (b) Block 2--Inspection office. Enter Government activity performing 
inspection on the cargo received.
    (c) Block 3--Report No. Leave blank.
    (d) Block 4--Agency placing order on shipper, city, state and/or 
local address (loading). Enter Government agency shown on loading 
report.
    (e) Block 5--Department. Enter Department owning product being 
received.
    (f) Block 6--Prime contract or P.O. No. Enter the contract or 
purchase order number shown on the loading report.
    (g) Block 7--Name of prime contractor, city, state and/or local 
address (loading). Enter the name and location of contractor who loaded 
the cargo.
    (h) Block 8--Storage contract. Enter the number of the contract 
under which material is placed in commercial storage where applicable.
    (i) Block 9--Terminal or refinery shipped from, city, state and/or 
local address. Enter source of cargo.
    (j) Block 10--Order no. on supplier. Make same entry appearing on 
loading report.
    (k) Block 11--Shipped to: (receiving activity, city, state and/or 
local address). Enter receiving activity's name and location.
    (l) Block 12--B/L Number. Enter as appears on loading report.
    (m) Block 13--Reqn. or Request No. Leave blank.
    (n) Block 14--Cargo No. Enter cargo number shown on loading report.
    (o) Block 15--Vessel. Enter name of tanker or barge discharging 
cargo.
    (p) Block 16--Draft arrival. Enter draft of vessel upon arrival at 
dock.
    (q) Block 17--Draft sailing. Enter draft of vessel after 
discharging.
    (r) Block 18--Previous two cargoes. Leave blank.
    (s) Block 19--Prior inspection. Enter the name and location of the 
Government office which inspected the cargo loading.
    (t) Block 20--Condition of shore pipeline. Enter condition of line 
(full or empty) before and after discharging.
    (u) Block 21--Appropriation (loading). Leave blank.

[[Page 632]]

    (v) Block 22--Contract item no. Enter the item number shown on the 
loading report.
    (w) Block 23--Product. Enter information appearing in Block 23 of 
the loading report.
    (x) Block 24--Specifications. Enter information appearing in Block 
24 of the loading report.
    (y) Block 25--Statement of quantity. Enter applicable data in proper 
columns.
    (1) Take ``LOADED'' figures from the loading report.
    (2) Determine quantities discharged from shore tank gauges at 
destination.
    (3) If a grade of product is discharged at more than one point, 
calculate the loss or gain for that product by the final discharge 
point. Report amounts previously discharged on discharge reports 
prepared by the previous discharge points. Transmit volume figures by 
routine message to the final discharge point in advance of mailed 
documents to expedite the loss or gain calculation and provide proration 
data when more than one department is involved.
    (4) The loss or gain percentage shall be entered in the ``PERCENT'' 
column followed by ``LOSS'' or ``GAIN,'' as applicable.
    (5) On destination acceptance shipments, accomplish the 
``DISCHARGED'' column only, unless instructed to the contrary.
    (z) Block 26--Statement of quality. (1) Under the heading ``TESTS'' 
enter the verification tests performed on the cargo preparatory to 
discharge.
    (2) Under ``SPECIFICATION LIMITS'' enter the limits, including 
authorized departures (if any) appearing on the loading report, for the 
tests performed.
    (3) Enter the results of tests performed under the heading ``TEST 
RESULTS.''
    (aa) Block 27--Time statement. Line out ``LOAD'' and ``LOADING.'' 
Complete all applicable entries of the time statement using local time. 
Take the dates and times from either the vessel or shore facility log. 
The Government representative shall ensure that these logs are in 
agreement with entries used. If the vessel and shore facility logs are 
not in agreement, the Government representative will explain the 
reason(s) in Block 28--REMARKS. Do not enter the date and time the 
vessel left berth on documents placed aboard the vessel. The date and 
time shall appear on all other copies. Express all dates in sequence of 
day, month, and year with the month spelled out or abbreviated (e.g., 10 
Sept. 67).
    (bb) Block 28--Remarks. Use this space for reporting important facts 
such as--
    (1) Delays, their cause, and responsible party (vessel, shore 
facility, Government representative, or others).
    (2) Abnormal individual losses contributing to the total loss. Enter 
the cause of such losses as well as actual or estimated volumes 
involved. Such losses shall include, but not be restricted to, product 
remaining aboard (enter tanks in which contained), spillages, line 
breaks, etc. Note where gravity group change of receiving tank contents 
results in a fictitious loss or gain. Note irregularities observed on 
comparing vessel ullages obtained at loading point with those at the 
discharge point if they indicate an abnormal transportation loss or 
contamination.
    (cc) Block 29--Company or receiving terminal. Line out ``COMPANY 
OR.'' Secure the signature of a representative of the receiving 
terminal.
    (dd) Block 30--Certification by government representative. Line out 
``LOADED.'' The Government representative shall date and sign the form 
to certify inspection and acceptance, as applicable, by the Government. 
The name of the individual signing the certification as well as the 
names applied in Blocks 29 and 31, shall be typed or hand lettered on 
the master or all copies of the form. The signature in Block 30 must 
agree with the typed or lettered name to be acceptable to the paying 
office.
    (ee) Block 31--Certification by master or agent. Obtain the 
signature of the master of the vessel or the vessel's agent.

                Part 7--Distribution of the DD Form 250-1

F-701  Distribution.
    (a) The Government representative shall distribute the completed DD 
Form 250-1 using Table 3 of this appendix as amended by the provisions 
of the contract or shipping order.
    (b) The contractor shall furnish the Government representative 
sufficient copies of the completed form to permit the required 
distribution.
    (c) Distribution of the form shall be made as soon as possible, but 
not later than 24 hours following completion of the form. (See Table 3 
on following pages)
F-702  Corrected DD Form 250-1.
    When errors are made in entries on the form which would affect 
payment or accountability, make corrected copies. Circle the corrected 
entries on all copies and mark the form ``CORRECTED COPY.'' Enter the 
statement, ``Corrections Have Been Verified,'' in Block 26 with the 
authorized Government representative's dated signature directly below. 
Make distribution of the certified corrected copy to all recipients of 
the original distribution.

[[Page 633]]



                                                                                                                                                        
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                     No. of copies                                      
                                                             -------------------------------------------------------------------------------------------
                                   Recipient of DD form 250-   Loading (prepared by shipper or government    Discharge (prepared by receiving activity) 
         Type of Shipment                      1                             representative)               ---------------------------------------------
                                                             ----------------------------------------------                                             
                                                                      Tanker                 Barge                  Tanker                 Barge        
--------------------------------------------------------------------------------------------------------------------------------------------------------
All..............................  Each Consignee (By mail    2....................  1....................  As Required..........  As Required          
                                    CONUS only).                                                                                                        
(On all overseas shipments         With Shipment............  1....................  1....................  As Required..........  As Required          
 provide for a minimum of 4        Master of Vessel.........  1....................  1....................  1....................  1                    
 consignees. Place 1 copy,         Tanker or Barge Agent....  2....................  2....................  2....................  2                    
 attached to ullage report, in     Contractor...............  As Required..........  As Required..........  As Required..........  As Required          
 each of 4 envelopes. Mark the     Cognizant Inspection       1....................  1....................  1....................  1                    
 envelopes, ``Consignee--First      Office.                   1....................  1....................  1....................  1                    
 Destination,'' Consignee--Second  Government Representative  .....................  .....................  .....................                       
 Destination,'' etc. Deliver via    responsible for quality   1....................  1....................  *1...................  *1                   
 the vessel.)                       at each destination.                                                                                                
                                   Government Representative                                                                                            
                                    at Cargo Loading Point.                                                                                             
On all USNS tankers and all MSC    Military Sealift Command,  2....................  2....................  2....................  2                    
 chartered tankers and MSC          Code N322, Washington,                                                                                              
 chartered barges.                  DC 20398-5100.                                                                                                      
See the contract or shipping       Payment Office: if this    2....................  2....................  2....................  2                    
 order for finance documentation    is DASC-F send copies                                                                                               
 and any supplemental               to: Defense Fuels Supply                                                                                            
 requirements for Government-       Center, ATTN: DFSC-RDX,                                                                                             
 owned product shipments and        Cameron Station, Bldg.                                                                                              
 receipts.                          5, Alexandria, Va 22304-                                                                                            
                                    6160 (do not send copies                                                                                            
                                    to DASC-F).                                                                                                         
For shipments and receipts of      Defense Fuels Supply       1....................  1....................  1....................  1                    
 DFSC financed cargos for which     Center, Attn: DFSC-RF,                                                                                              
 DASC-F is not the paying office.   Cameron Station,                                                                                                    
                                    Alexandria, VA 22304-                                                                                               
                                    6160.                                                                                                               
For shipments on all USNS          Defense Fuels Supply       1....................  1....................  **1..................  1                    
 tankers, MSC chartered tankers     Center, ATTN: DFSC-01,                                                                                              
 and barges, and FOB destination    Cameron Station,                                                                                                    
 tankers with copy of ullage        Alexandria, VA 22304-                                                                                               
 report.                            6160.                                                                                                               
On Army ILP shipments............  U.S. Army International    2....................  2....................  2....................  2                    
                                    Logistics Center, New                                                                                               
                                    Cumberland Army Depot,                                                                                              
                                    New Cumberland, PA 17070-                                                                                           
                                    5001.                                                                                                               
Navy--On all shipments to Navy     Navy Fuels Petroleum       2....................  1....................  2....................  1                    
 Operated Terminals.                Office, Cameron Station,                                                                                            
                                    Alexandria, Va 22304-                                                                                               
                                    6180.                                                                                                               
On all shipments to AF Bases.....  Directorate of Energy      1....................  1....................  1....................  1                    
                                    management, SA ALC(SFT),                                                                                            
                                    Kelly AFB, TX 78241-5000.                                                                                           
On all Conus loadings............  DFSC Fuels Region(s)       1....................  1....................  1....................  1                    
                                    cognizant of shiping                                                                                                
                                    point.                                                                                                              
On all shipments to CONUS          DFSC Fuel Region(s)        1....................  1....................  0....................  0                    
 Destinations.                      cognizant of shipping                                                                                               
                                    and receiving point****.                                                                                            
For all discharges of cargos       Defense Fuels Supply       .....................  .....................  ***1.................  ***1                 
 originating at DFSPs and           Center, ATTN: DFSC-RF,                                                                                              
 discharging at activities not a    Cameron Station,                                                                                                    
 Defense Fuel Support Point.        Alexandria, VA 22304-                                                                                               
                                    6160.                                                                                                               
--------------------------------------------------------------------------------------------------------------------------------------------------------
*With copy of ullage report.                                                                                                                            
**Dry tank certificate to accompany DD Form 250-1 and ullage report.                                                                                    
***Copies of the DD Form 250-1, forwarded by bases, will include the following in block 11: Shipped to: Supplementary Address, if applicable; Signal    
  Code; and Fund Code.                                                                                                                                  
****See Table 4.                                                                                                                                        

[[Page 634]]

                                                                                                                                                        


       Table 4--Fuel Region Locations and Areas of Responsibility       
                                                                        
                                                                        
                                                                        
a. DFR Northeast.............  Defense Fuel Region Northeast, Building  
                                2404, McGuire AFB, NJ 08641-5000.       
    Area of Responsibility...  Connecticut, Delaware, District of       
                                Columbia, Maine, Maryland,              
                                Massachusetts, New Hampshire, New       
                                Jersey, New York, Pennsylvania, Rhode   
                                Island, Vermont, Virginia, West         
                                Virginia.                               
b. DFR Central...............  Defense Fuel Region Central, 8900 S.     
                                Broadway, Building 2, St. Louis, MO     
                                63125-1513.                             
    Area of Responsibility...  Colorado, Illinois, Indiana, Iowa,       
                                Kansas, Kentucky, Michigan, Minnesota,  
                                Missouri, Nebraska, North Dakota, Ohio, 
                                South Dakota, Wisconsin, and Wyoming.   
c. DFR South.................  Defense Fuel Region South, Federal Office
                                Building, 2320 La Branch, Room 1213,    
                                Houston, TX 77004-1091.                 
    Area of Responsibility...  Alabama, Arizona, Arkansas, Caribbean    
                                Area, Florida, Georgia, Louisiana,      
                                Mexico, Mississippi, New Mexico, North  
                                Carolina, Oklahoma, Puerto Rico, South  
                                Carolina, Tennessee, Texas, West Indies,
                                Central America, and South America.     
d. DFR West..................  Defense Fuel Region West, 3171 N. Gaffney
                                Street, San Pedro, CA 90731-1099.       
    Area of Responsibility...  California, Idaho, Montana, Nevada,      
                                Oregon, Utah, and Washington.           
e. DFR Alaska................  Defense Fuel Region Alaska, Elmendorf    
                                AFB, Alaska 99506-5000.                 
    Area of Responsibility...  Alaska and Aleutians.                    
f. DFR Europe................  Defense Fuel Region Europe, Building     
                                2304, APO New York 09128-4105.          
    Area of Responsibility...  Continental Europe, United Kingdom,      
                                Mediterranean Area, Turkey, and Africa  
                                (less Djibouti, Egypt, Ethiopia, Kenya, 
                                Somalia).                               
g. DFR Mideast...............  Defense Fuels Region, Middle East, P.O.  
                                Box 386, Awali, Bahrain, APO New York   
                                09526-2830.                             
    Area of Responsibility...  Afghanistan, Bahrain, Djibouti, Egypt,   
                                Ethiopia, Iran, Iraq, Jordan, Kenya,    
                                Kuwait, Oman, Pakistan, Qatar, Saudi    
                                Arabia, Somalia, Sudan, United Arab     
                                Emirates, and Yemen.                    
h. DFR Pacific...............  Defense Fuel Region, Pacific, Camp H. M. 
                                Smith, Honolulu, HI 96861-5000.         
    Area of Responsibility...  Australia, Burma, East Indies, Hawaii,   
                                Indian Ocean, Japan, Korea, Malaya,     
                                Marianas, New Zealand, Philippines,     
                                Ryukyu Islands, South Pacific Islands,  
                                Sri Lanka, Taiwan, and Thailand.        
                                                                        

[56 FR 36610, July 31, 1991, as amended at 57 FR 53602, Nov. 12, 1992; 
58 FR 37868, July 14, 1993; 59 FR 27678, May 27, 1994; 60 FR 61615, Nov. 
30, 1995]

           Appendix G to Chapter II--Activity Address Numbers

                            Table of Contents

    Part 1--General.
    G-100  Scope
    G-101  Assignment and use of a number
    G-102  Activity address number data base maintenance
Part 2--Army Activity Address Numbers.
Part 3--Navy Activity Address Numbers.
Part 4--Marine Corps Activity Address Numbers.
Part 5--Air Force Activity Address Numbers.
Part 6--Defense Logistics Agency Activity Address Numbers.
Part 7--Defense Information Systems Agency Activity Address Numbers.
Part 8--Defense Mapping Agency Activity Address Numbers.
Part 9--Defense Special Weapons Agency Activity Address Numbers.
Part 10--Miscellaneous Defense Activities Activity Address Numbers.
Part 11--On-Site Inspection Agency Activity Address Numbers.
Part 12--Ballistic Missile Defense Organization Activity Address 
          Numbers.
Part 13--Defense Commissary Agency Activity Address Numbers.
Part 14--United States Special Operations Command Activities Address 
          Numbers.

    Authority; 41 U.S.C. 421 and 48 CFR chapter 1.

                             PART 1--GENERAL

G-100  Scope.
    This appendix identifies the activity address numbers to be used 
with the uniform procurement instrument identification numbering system 
prescribed in DFARS subpart 204.70.
G-101  Assignment and use of a number.
    (a) Activities coding solicitations, contracts and related 
instruments shall use only those codes assigned by their respective 
department/agency activity address monitor(s).
    (b) The six-character code is used in the first six positions of the 
procurement instrument identification number (PIIN). When required, 
activities also will be assigned a two position code. The two position 
code is used in the first two positions of the call/order serial number.
    (c) Activity address monitors are--

                                  Army

Department of the Army, Attn: OSA(RDA)-PA, 5109 Leesburg Pike, Suite 
916, Falls Church, VA 22041-3201

                                 Navy *

Navy Accounting and Finance Center (NAFC-5511), Washington, DC 20376-
5001

[[Page 635]]

                             Marine Corps *

Headquarters, U.S. Marine Corps (Code LBP), Washington, DC 20380-0001

                                Air Force

SAF/AQCO, 1060 Air Force Pentagon, Washington, DC 20330-1060

                        Defense Logistics Agency

Defense Logistics Agency, Acquisition Operations Team, 8725 John J. 
Kingman Road Suit 2533, Fort Belvoir, VA 22060-6221

                         Other Defense Agencies

    All other Defense agencies will forward requests for Appendix G 
maintenance to the Department of the Army, OSA(RDA)-PA.

    * The Navy and Marine Corps Activity Address Monitor for assignment 
of two-character call/order serial numbers is: Office of the Assistant 
Secretary of the Navy (RD&A), Room 536, Crystal Plaza 5, Washington, DC 
20350-1000.
G-102  Activity address number data base maintenance.
    (a) The Defense Logistics Agency, DLA-PS, Cameron Station, 
Alexandria, VA 22304-6100 is the executive agent for maintenance of six 
and two character code assignments. The executive agency distributes 
blocks of two character codes to department/agency activity address 
monitors for further assignment.
    (b) Contracting activities submit requests for assignment of or 
changes in either the six character or two character codes to their 
activity address monitor in accordance with department/agency 
procedures. Activity address monitors--
    (1) Approve request for additions, deletions, or changes;
    (2) Notify the executive editor, Defense Acquisition Regulations 
System, OUSD(A&T)DP(DAR), 3062 Defense Pentagon, Washington, DC 20301-
3062; and
    (3) Provide a copy of the notification to the executive agent.
    (c) A copy of the appendix G data base is available on tape or MS-
DOS compatible floppy diskettes from the executive agent.

                  PART 2--ARMY ACTIVITY ADDRESS NUMBERS

DAAA03, B1  Pine Bluff Arsenal, Attn: SMCPB-PO, 10020 Kabrich Circle, 
Pine Bluff, AR 71602-9500
DAAA08, B7  Rock Island Arsenal, Attn: SMCRI-CT, Rock Island, IL 61299-
5000
DAAA09, BA  U.S. Army Armament, Munitions, and Chemical Command, Attn: 
AMSIO-ACS, Rock Island, IL 61299-6000
DAAA22, BV  Watervliet Arsenal, Attn: SIOWV-PPA, Watervliet, NY 12189-
4050
DAAA31, GJ  McAlester Army Ammunition Plant, Attn: SMCMC-PC, McAlester, 
OK 74501-5000
DAAA32, 0P  Crane Army Ammunition Activity, Attn: SMCCN-CT, 300 Highway 
361, Crane, IN 47522-5099
DAAB07, BG  USA Communications-Electronics Command, C3I Acquisition 
Center, Attn: AMSEL-ACSP-BM, Fort Monmouth, NJ 07703-5008
DAAB08, 2V  USA Communications-Electronics Command, C3I Acquisition 
Center, Attn: AMSEL-ACSB-C (Facility ADP Branch), Fort Monmouth, NJ 
07703-5008
DAAB10, ZP  USA CECOM C3I Acquisition Center, Attn: AMSEL-ACVF-A-AA 
(Stop 42), Building 160, Warrenton, VA 22186-5172
DAAB11, D0  USA CECOM C3I Acquisition Center, Attn: AMSEL-AC-VHA-HB Base 
OPS (Stop 42), Warrenton, VA 22186-5172
DAAB22, E7  Headquarters, 5th Signal Command, DCSLOG, Contract 
Management Division, Attn: ASQE-LG-C, CMR 421, APO AE 09056-3104
DAAB23, E8  1st Signal Brigade, Unit #15271, Attn: ASQK-L-CO, APO AP 
96205-0044
DAAB24, Joint Visual Information Activity, Attn: SAM-OPV-V, 601 North 
Fairfax Street, Rm 334, Alexandria, VA 22314-2007
DAAC01, BH  Anniston Army Depot, Attn: SDSAN-DOC, Anniston, AL 36201-
5003
DAAC02, 9X  Lexington Blue Grass Army Depot, Procurement Office, Attn: 
SIO-BG-PO, 2091 Kingston Highway, Richmond, KY 40475-5115
DAAC07, ZM  Sierra Army Depot, Attn: SDSSI-CONT, Herlong, CA 96113-5009,
DAAC67, ZN  Letterkenny Army Depot, Attn: SDSLE-P, Chambersburg, PA 
17201-4152
DAAC71, ZS  Tobyhanna Army Depot, Attn: SKSTO-K, Tobyhanna, PA 18466-
5100
DAAC79, D7  Red River Army Depot, Attn: SDSRR-P, Texarkana, TX 75507-
5000
DAAC83, BJ  Corpus Christi Army Depot, Attn: SDSCC-C, Corpus Christi, TX 
78419-6170
DAAC89, BK  Tooele Army Depot, Attn: SDSTE-DCBO, Tooele, UT 84074-0839
DAAD01, B5  USA Yuma Proving Ground, Directorate of Contracting, Attn: 
ATEYP-CR, Yuma, AZ 85365-9106
DAAD05, BM  USA Aberdeen Proving Ground, Support Activity, Attn: STEAP-
PR/M, Ryan Building, Aberdeen Proving Ground, MD 21005-5001
DAAD07, BN  USA White Sands Missile Range, Directorate of Contracting, 
Attn: STEWS-PR, White Sands, NM 88002-5201
DAAD09, BP  USA Dugway Proving Ground, Directorate of Contracting, Attn: 
STEDP-DOC, Dugway, UT 84022-0538
DAAE07, BR  USA Tank-Automotive Command, Attn: AMSTRA-IDAS, Warren, MI 
48397-5000
DAAE20, DG  Armament and Chemical Acquisition and Logistics Activity 
(ACALA),

[[Page 636]]

Attn: Acquisition Center, Rock Island, IL 61299-6000
DAAE30, 2T  U.S. Army Armament RD&E Center (ARDEC), Attn: SMCAR-PCM-O, 
Building 9, Picatinny Arsenal, NJ 07806-5000
DAAG55, YU  U.S. Army Research Office (ARO), Attn: AMXRO-PR, P.O. Box 
12211, Research Triangle Park, NC 27709-2211
DAAG99, ZY  USA Program Manager-SANG, Attn: AMCPM-NGA, Unit 61304, APO 
AE 09803-1304
DAAH01, CC  USA Missile Command, Attn: AMSMI-AC, Redstone Arsenal, AL 
35898-5280
DAAH03, D8  USA Missile Command, Attn: AMSMI-AC, Redstone Arsenal, AL 
35898-5280
DAAJ02, D9  Aviation Applied Technology Directorate, U.S. Army Aviation 
and Troop Command, Attn: AMSAT-R-TC, Building 401, Fort Eustis, VA 
23604-5577
DAAJ04, 0V  USA Charles Melvin Price Support Center, Attn: SATAS-P, 
Granite City, IL 62040-1801
DAAJ05, ZF  USA Aviation and Troop Command, Attn: IAS21WG, Building 404, 
Fort Eustis, VA 23604-5577
DAAJ09, BS  USA Aviation and Troop Command, Attn: AMSAT-A-AD, 4300 
Goodfellow Boulevard, St. Louis, MO 63120-1798
DAAK01, BB  USA Aviation and Troop Command, Attn: AMSAT-A-AD, 4300 
Goodfellow Boulevard, St. Louis, MO 63120-1798
DAAK60, C5  Soldier Systems Command Acquisition Center, Attn: SATNC-PP 
(Procurement Support Division), Natick, MA 01760-5011
DAAL01, 1Y  U.S. Army Research Laboratory, Attn: AMSRL-OP-PR, 2800 
Powder Mill Road, Adelphi, MD 20783-1145
DAAM01, ZU  U.S. Army Chemical and Biological Defense Command, Attn: 
AMSCB-PC, Building E4455, Aberdeen Proving Ground, MD 21010-5423
DAAM02, B2  Rocky Mountain Arsenal, Attn: AMXRM-PM, Building 111, 
Commerce City, CO 80022-1748
DABT01, F6  U.S. Army Aviation Center, Contracting Office, Attn: ATZQ-C, 
Building T-00116, Fort Rucker, AL 36362-5000
DABT02, 2A  U.S. Army Chemical and Military Police Centers and Fort 
McClellan, Attn: ATZN-DOC, Building 241-C, Transportation Road, Fort 
McClellan, AL 36205-5000
DABT10, 2B  U.S. Army Infantry Center and Fort Benning, Attn: ATZB-KT, 
Building 6, Meloy Hall, Room 207, Fort Benning, GA 31905-5000
DABT11, 2C  U.S. Army Signal Center and Fort Gordon, Attn: ATZH-CT, 
Building 2102, Fort Gordon, GA 30905-5110
DABT19, 2D  U.S. Army Combined Arms Center and Fort Leavenworth, Attn: 
ATZL-GCC, 600 Thomas Avenue, Fort Leavenworth, KS 66027-1389
DABT23, 2E  U.S. Army Armor Center and Fort Knox, Attn: ATZK-DC, 
Building 4022, Fort Knox, KY 40121-5000
DABT31, 2F  U.S. Army Engineer Center and Fort Leonard Wood, Attn: ATZT-
DOC, Building 606, P.O. Box 140, Fort Leonard Wood, MO 65473-0140
DABT39, 2H  U.S. Army Field Artillery Center and fort Sill, Attn: ATZR-
Q, Building 1803, P.O. Box 3501, Fort Sill, OK 73503-0501
DABT43, 2J  Carlisle Barracks, Attn: ATZE-DOC-C, 314 Lovell Avenue, 
Suite 1, Carlisle Barracks, PA 17013-5072
DABT47, 2K  U.S. Army Training Center and Fort Jackson, Attn: ATZK-DOC, 
Building 4340, Magruder Street, Fort Jackson, SC 29207-5491
DABT51, 2L  U.S. Army Air Defense Artillery Center and Fort Bliss, Attn: 
ATZC-DOC, Building 2021, 1733 Pleasonton Road, Fort Bliss, TX 79916-6816
DABT57, 2N  Directorate of Peninsula Contracting, Attn: ATZF-DPC, 
Building 2746, Harrison Loop, Fort Eustis, VA 23604-5293
DABT58, 2P  Fort Monroe, Attn: ATZG-C #62, Building T-195, Fort Monroe, 
VA 23651-6000
DABT59, 2Q  U.S. Army Combined Arms Support Command and Fort Lee, Attn: 
ATZM-DOC, 1830 Quartermaster Road, Fort Lee, VA 23801-1606
DABT60, 1L  TRADOC Contracting Agency, Attn: ATCA, Building 2798, Fort 
Eustis, VA 23604-5538
DABT61, BF  The Judge Advocate General's School, USA, University of 
Virginia, Attn: JAGS-SSL-B, 600 Massie Road, Charlottesville, VA 22903-
1781
DABT63, BL  U.S. Army Intelligence Center, Attn: ATZS-DK, P.O. Box 
12748, Fort Huachuca, AZ 85670-2748
DABT65, B0  Mission Contracting Activity at Fort Leavenworth, Attn: 
ATOB-AL, Room 303, 600 Thomas Avenue, Fort Leavenworth, KS 6602-1389
DABT67, 0Q  Commander DLIFLC & POM, Attn: ATZP-DOC, Building 276, 
Plummer Street, Presidio of Monterey, CA 93944-5006
DACA01, DACW01, CK  USA Engineer District, Mobile, Attn: CESAM-CT, P.O. 
Box 2288, Mobile, AL 36628-0001
DACA03, DACW03, CL  USA Engineer District, Little Rock, Attn: DESWL-CT, 
P.O. Box 867, Little Rock, AR 72203-0867
DACA05, DACW05, CM  USA Engineer District, Sacramento, Attn: DESPK-CT, 
1325 J Street, Sacramento, CA 95814-2922
DACA07, DACW07, CP  USA Engineer District, San Francisco, Attn: CESPN-
CT, 333 Market Street, San Francisco, CA 94105-2197
DACA09, DACW09, CQ  USA Engineer District, Los Angeles, Attn: CESPL-CT, 
P.O. Box 2711, Los Angeles, CA 90053-2325
DACA17, DACW17, CS  USA Engineer District, Jacksonville, Attn: CESAJ-CT, 
P.O. Box 4970, Jacksonville, FL 32232-0019

[[Page 637]]

DACA21, DACW21, CV  USA Engineer District, Savannah, Attn: CESAS-CT, 
P.O. Box 889, Savannah, GA 31402-0889
DACA23, DACW23, CX  USA Engineer District, Chicago, Attn: CENCR-CT, 111 
North Canal Street, Chicago, IL 60606-7206
DACA25, DACW25, CD  USA Engineer District, Rock Island, Clock Tower 
Building, Attn: CENCR-CT, P.O. Box 2004, Rock Island, IL 61202-2004
DACA27, DACW27, CY  USA Engineer District, Louisville, Attn: CEORL-CT, 
P.O. Box 59, Louisville, KY 40201-0059
DACA29, DACW29, CZ   USA Engineer District, New Orleans, Attn: CELMN-CT, 
P.O. Box 60267, New Orleans, LA 70160-0267
DACA31, DACW31, DA   USA Engineer District, Baltimore, Contracting 
Division, Attn: CENAB-CT, P.O. Box 1715, Baltimore, MD 21203-1715
DACA33, DACW33, DB   USA Engineer District, New England, Attn: CENED-CT, 
424 Trapelo Road, Waltham, MA 02254-9149
DACA35, DACW35, DC   USA Engineer District, Detroit, Attn: CENCE-CT, 
P.O. Box 1027, Detroit, MI 48231-1027
DACA37, DACW37, DD   USA Engineer District, St, Paul, Attn: CENCS-CT, 
190 Fifth Street East, St. Paul, MN 55101-1638
DACA38, DACW38, DE   USA Engineer District, Vicksburg, Attn: CELMK-CT, 
3515 I-20 Frontage Road, Vicksburg, MS 39180-5191
DACA39, DACW39, DF   USA Engineer, Waterways Experiment Station, Attn: 
CEWES-CT-Z (Contracting Division), 3909 Halls Ferry Road, Vicksburg, MS 
39180-6199
DACA41, DACW41, DH   USA Engineer District, Kansas City, Attn: CEMRK-CT, 
601 East 12th Street, Kansas City, MO 64106-2896
DACA43, DACW43, DJ   USA Engineer District, St. Louis, Attn: CELMS-CT, 
1222 Spruce Street, St. Louis, MO 63103-2833
DACA45, DACW45, DK   USA Engineer District, Omaha, Attn: CEMRO-CT, 215, 
North 17th Street, Omaha, NE 68102-4978
DACA47, DACW47, DM   USA Engineer District, Albuquerque, Attn: CESWA-CT, 
P.O. Box 1580, Albuquerque, NM 87103-1580
DACA49, DACW49, DN   USA Engineer District, Buffalo, Attn: CENCB-CT, 
(Contracting Division), 1776 Niagara Street, Buffalo, NY 14207-3199
DACA51, DACW51, CE   USA Engineer District, New York, Contracting 
Division, Attn: CENAN-CT, 26 Federal Plaza, New York, NY 10028-0090
DACA54, DACW54, DQ   USA Engineer District, Wilmington, Attn: CESAW-CT, 
P.O. Box 1890, Wilmington, NC 28402-1890
DACA56, DACW56, DS   USA Engineer District, Tulsa, Attn: CESWT-CT, P.O. 
Box 61, Tulsa, OK 74121-0061
DACA57, DACW57, DT   USA Engineer District, Portland, Attn: CENPP-CT, 
P.O. Box 2946, Portland, OR 97208-2946
DACA59, DACW59, DV  USA Engineer District, Pittsburgh, Attn: CEORP-CT-
SADBUS, 1000 Liberty Avenue, Pittsburgh, PA 15222-4186
DACA60, DACW60, DW  USA Engineer District, Charleston, Attn: CESAC-CT, 
P.O. Box 919, Charleston, SC 29402-0919
DACA61, DACW61, CF  USA Engineer District, Philadelphia, Attn: CENAP-CT, 
Contracting Division, 110 Penn Square East, Wanamaker Building, 
Philadelphia, PA 19107-3390
DACA62, DACW62, DX  USA Engineer District, Nashville, Attn: CEORN-CT, 
P.O. Box 1070, Nashville, TN 37202-1070
DACA63, DACW63, DY  USA Engineer Distrct, Fort Worth, Attn: CESWF-CT, 
P.O. Box 17300, Fort Worth, TX 76102-0300, Fort Worth, TX 76102-0300
DACA64, DACW64, DZ  USA Engineer District, Galveston, Attn: CESWG-CT, 
P.O. Box 1229, Galveston, TX 77553
DACA65, DACW65, EA  USA Engineer District, Norfolk, Contracting 
Division, Attn: CENAO-CT, 803 Front Street, Norfolk, VA 23510-1096
DACA66, DACW66, EB  USA Engineer District, Memphis, Attn: CEIMM-CT, B-
202 Clifford Davis Federal Building, Memphis, TN 38103-1894
DACA67, DACW67, EC  USA Engineer District, Seattle, Attn: CENPS-CT, P.O. 
Box C-3755, Seattle, WA 98124-2255
DACA68, DACW68, YW  USA Engineer District, Walla Walla, Attn: CENPW-CT, 
Building 602, City-County Airport, Walla Walla, WA 99362-9265
DACA69, DACW69, CB  USA Engineer District, Huntington, Attn: CEORH-CT, 
502 8th Street, Huntington, WV 25701-2070
DACA72, DACW72, ZA  USA Humphreys Engineer Center, Support Activity, 
Attn: CEHEC-CT, Kingman Building, Fort Belvoir, VA 22060-5580
DACA75, DACW75, ZC  USA Engineer Ordnance Program Division, Attn: CETAD-
OP-C, APO AE 09803-1303
DACA76, DACW76, ZD  USA Topographic Engineering Center, Attn: CETEC-CT, 
7701 Telegraph Road, Alexandria, VA 22315-3864
DACA78, DACW78, 9V  USA Engineer Transatlantic Division, Attn: CETAD-CT-
P, 201 Prince Frederick Drive, Winchester, VA 22602
DACA79, DACW79, 2R  USA Engineer District Japan, Attn: CEPOJ-CT, Unit 
45010, APO AP 96343-0061
DACA81, DACW81  USA Engineer District, Far East, APO AP 96205-0610
DACA83, DACW83, ZH  USA Engineer Division--Pacific Ocean, Attn: CEPOD-
CT, Building 230, Fort Shafter, HI 96858-5540
DACA85, DACW85, ZJ  USA Engineer District, Alaska, P.O. Box 898, 
Anchorage, AK 99506-0898

[[Page 638]]

DACA87, DACW87, ZW  USA Engineer Division, Huntsville, Attn: CEHND-CT, 
P.O. Box 1600, Huntsville, AL 35807-4301
DACA88, DACW88, 0S  USA Construction Engineering Research Laboratory, 
Attn: CECER-CT, P.O. Box 4005, Champaign, IL 61820-1305
DACA89, DACW89, 1Z  USA Cold Regions Research and Engineering 
Laboratory, Attn: CECRL-LM-CT, 72 Lyme Road, Hanover, NH 03755-1290
DACA90, DACW90  Trans Atlantic Program Center--Europe, Attn: CETAE-CT, 
CMR 410, Box 7, APO AE 09096
DADA03, 8W  Fitzsimons Army Medical Center, Directorate of Contracting, 
Attn: HSHG-DC, Building 205, 10th Street and McCloskey Avenue, Aurora, 
CO 80045-5001
DADA08, BT  Dwight David Eisenhower Medical Center, Contracting Office, 
Attn: HSAA-D, Building 39706, 40 A Street, Fort Gordon, GA 30905-5650
DADA09, YY  William Beaumont Army Medical Center, Attn: HSAA-W, Building 
7777, Piedras Street, Room 4J18, El Paso, TX 79920-5001
DADA10, ZQ  U.S. Army Medical Command, Central Contracting Office, Attn: 
HSAA-C, Building 2015, 1105 Beebe Loop, Fort Sam Houston, TX 78234-6000
DADA13, 0W  Madigan Army Medical Center, Contracting Office, Attn: HSAA-
M, Building 9933-A, Johnson Street, Tacoma, WA 98431-5100
DADA15, 0X  Walter Reed Army Medical Center, Directorate of Contracting, 
Attn: HSHL-ZC, Building T-20, 1st Floor, Washington, DC 20307-5001
DADA16, 0Y  Tripler Army Medical Center, Contracting Office, Attn: HSAA-
T, Building 160, Krukowski Street, Tripler AMC, HI 96859-5000
DADA18, 1R  Directorate of Contracting, Attn: AFZG-DOC, Building 4201, 
Fort Sam Houston, TX 78234-5000
DADA19  EURO-RMC (Regional Medical Command), Landstuhl, Germany, AP AE 
09180-3460
DADW30, 0F  US Army Military District of Washington, Attn: ANPC, 103 3rd 
Avenue, Fort Lesley J. McNair, Washington, DC 20319-5050
DADW35, 2M  USA Garrison Fort Belvoir, Directorate of Contracting, Attn: 
ANFB-OC, 9410 Jackson Loop, Suite 101, Fort Belvoir, VA 22060-5134
DADW36, 1J  Fort Meade Directorate of Contracting, Attn: ANME-OC, 
Building 2234, Fort George G. Meade, MD 20755-5081
DADW38, 2S  Fort Ritchie Directorate of Contracting, 601 Lakeside Drive, 
Fort Ritchie, MD 21719-4020
DADW49, 0M  National Defense University, Contracting Office, Attn: NDU-
LG-P, Building 62, Fort Lesley J. McNair, Washington, DC 20319-5066
DAHA01, 9B  USPFO for Alabama, P.O. Box 3715, Montgomery, AL 36193-4801
DAHA02, 0G  USPFO for Arizona, 5644 East Moreland Street, Phoenix, AZ 
85008-3442
DAHA03, 9D  USPFO for Arkansas, Camp Robinson, North Little Rock, AR 
72118-2200
DAHA04, 9N  USPFO for California, P.O. Box 8104, San Luis Obispo, CA 
93403-8104
DAHA05, Z0  USPFO for Colorado, 660 South Aspen Street, Bldg 1005, Mail 
Stop 53, Aurora, CO 80011-9511
DAHA06, 1S  USPFO for Connecticut, State Armory, Attn: Contracting 
Officer, 360 Broad Street, Hartford, CT 06105-3795
DAHA07, 9A  USPFO for Delaware, Grier Building, 1161 River Road, New 
Castle, DE 19720-5199
DAHA08, 2W  USPFO for Florida, P.O. Box 1008, St. Augustine, FL 32085-
1008
DAHA09, C0  USPFO for Georgia, P.O. Box 17882, Atlanta, GA 30316-0882
DAHA10, CU  USPFO for Idaho, 4040 W. Guard Street, Boise, ID 83705-5004
DAHA11, 9E  USPFO for Illinois, 1301 North McArthur Boulevard, 
Springfield, IL 62702-2399
DAHA12, 4E  USPFO for Indiana, 2002 S. Holt Road, Indianapolis, IN 
46241-4839
DAHA13, 9L  USPFO for Iowa, Camp Dodge, 7700 NW Beaver Drive, Johnston, 
IA 50131-1902
DAHA14, 4Z  USPFO for Kansas, 2737 South Kansas Avenue, Topeka, KS 
66611-1170
DAHA15, 6P  USPFO for Kentucky, Boone National Guard Center, Frankfort, 
KY 40601-6192
DAHA16, 0A  USPFO for Louisiana, Jackson Barracks, New Orleans, LA 
70146-0330
DAHA17, 0B  USPFO for Maine, Camp Keys, Augusta, ME 04333-0032
DAHA18, 0C  USPFO for Maryland, State Mil Reservation, 301 Old Bay Lane, 
Havre de Grace, MD 21078-4094
DAHA19, 0D  USPFO for Massachusetts, Attn: Contracting Officer, 143 
Speen Street, Natick, MA 01760-2599
DAHA20, 9F  USPFO for Michigan, 3111 West St. Joseph Street, Lansing, MI 
48913-5102
DAHA21, 9K  USPFO for Minnesota, Camp Ripley, P.O. Box 288, Little 
Falls, MN 56345-0288
DAHA22, CW  USPFO for Mississippi, 144 Military Drive, Jackson, MS 
39208-8880
DAHA23, 9H  USPFO for Missouri, 1715 Industrial Avenue, Jefferson City, 
MO 65101-1468
DAHA24, 9P  USPFO for Montana, P.O. Box 1157, Helena, MT 59624-1157
DAHA25  USPFO for Nebraska, 1234 Military Road, Lincoln, NE 68508-1092
DAHA26  USPFO for Nevada, 2601 South Carson Street, Carson City, NV 
89701-5596
DAHA27  USPFO for New Hampshire, P.O. Box 2003, Concord, NH 03301-2003
DAHA28, ZK  USPFO for New Jersey, 131 Eggert Crossing Road, 
Lawrenceville, NJ 08648-2805

[[Page 639]]

DAHA29  USPFO for New Mexico, Attn: Contracting Officer, P.O. Box 4277, 
Santa Fe, NM 87502-4277
DAHA30, D2  USPFO for New York, 330 Old Niskayuna Road, Latham, NY 
12110-2224
DAHA31, D3  USPFO for North Carolina, 4201 Reedy Creek Road, Raleigh, NC 
27607-6412
DAHA32, D6  USPFO for North Dakota, P.O. Box 5511, Bismarck, ND 58502-
5511
DAHA33, 9M  USPFO for Ohio, 2811 West Granville Road, Columbus, OH 
43235-2712
DAHA34, 9J  USPFO for Oklahoma, 3501 Military Circle, N.E., Oklahoma 
City, OK 73111-4398
DAHA35, 1X  USPFO for Oregon, Attn: USPFO-P, P.O. Box 14840, Salem, OR 
97309-5008
DAHA36, DL  USPFO for Pennsylvania, Department of Military Affairs, ATT: 
Contracting Officer, Annville, PA 17003-5003
DAHA37  USPFO for Rhode Island, 330 Camp Street, Providence, RI 02906-
1954
DAHA38, DU  USPFO for South Carolina, 9 National Guard Road, Columbia, 
SC 29201-4766
DAHA39, VQ  USPFO for South Dakota, Camp Rapid, Rapid City, SD 57702-
8186
DAHA40, YX  USPFO for Tennessee, Powell Avenue, P.O. Box 40748, 
Nashville, TN 37204-0748
DAHA41, 9C  USPFO for Texas, Attn: Contracting Officer, P.O. Box 5218, 
Austin, TX 78563-5218
DAHA42  USPFO for Utah, P.O. Box 2000, Draper, UT 84020-2000
DAHA43  USPFO for Vermont, Camp Johnson, Building #3, P.O. Box 2000, 
Colchester, VT 05446-3004
DAHA44, ZR  USPFO for Virginia, 501 East Franklin Street, Richmond, VA 
23219-2317
DAHA45, ZX  USPFO for Washington, Camp Murray, Tacoma, WA 98430-5000
DAHA46  USPFO for West Virginia, 50 Armory Road, Buckhannon, WV 26201-
2396
DAHA47, 9G  USPFO for Wisconsin, 8 Madison Blvd., Camp Douglas, WI 
54618-5002
DAHA48  USPFO for Wyoming, P.O. Box 1709, Cheyenne, WY 82003-1709
DAHA49  USPFO for the District of Columbia, Anacostia Naval Air Station, 
Building 350, Washington, DC 203315-0001
DAHA50  USPFO for Hawaii, 4208 Diamond Head Road, Honolulu, HI 96816-
4495
DAHA51, 2Z  USPFO for Alaska, Attn: P&C Division, Camp Denali, P.O. Box 
B, Fort Richardson, AK 99505-2600
DAHA70  USPFO for Puerto Rico, P.O. Box 3786, San Juan, PR 00904-3786
DAHA72  USPFO for Virgin Islands, #9 Estate Diamond, Frederiksted, St. 
Croix, VI 00840
DAHA74  USPFO for Guam, 622 E. Harmon Industrial Park Road, Tamuning, GU 
96911-4422
DAHA90, 2Y  National Guard Bureau, Contracting Support, 5109 Leesburg 
Pike, Suite 401-B, Falls Church, VA 22041-3201
DAHC76, 8U  U.S. Army Garrison, Alaska, Directorate of Contracting, 
Attn: APVR-DOC, P.O. Box 5-525, Fort Richardson, AK 99505-0525
DAHC77, CJ  U.S. Army Garrison, Hawaii, Directorate of Contracting, 
Attn: APVG-GK, Building 520, Pierce Street, Fort Shafter, HI 96858-5025
DAJA01, 9Q  RCO Vicenza, Attn: AEUCC-I, Unit 31401, Box 33, APO AE 09630
DAJA02, G5  RCO Seckenheim, Attn: AEUCC-S, Unit 29331, APO AE 09266
DAJA16, 8X  RCO Grafenwoehr, Attn: AEUCC-G, Unit 28130, APO AE 09114
DAJA22, G6  Wiesbaden Regional Contracting Center, Attn: AEUCC-C, CMR 
410, Box 741, APO AE 09096
DAJA61, 9Z  RCO Benelux, Attn: AEUCC-B, PSC 79, Box 003, APO AE 09724
DAJA77  HQ, USACCE (Contracting Cell, Deployed), Attn: AEUCC-O, Unit 
29331, APO AE 09266
DAJA89, F0  RCO Wuerzburg, Attn: AEUCC-W, Unit 26622, APO AE 09244
DAJA90, 0T  RCO Bad Kreuznach, Attn: AEUCC-BK, Unit 24307, APO AE 09252
DAJB03, F4  HQ, EUSA, Asst Cofs Acquisition Mgt, Attn: EAAQ (PARC), Unit 
15236, APO AP 96205-0009
DAJN21, 1V  U.S. Army Garrison, Panama, Directorate of Contracting, 
Attn: SOCO-CO, Unit 7116, APO AA 34002-5000
DAKF04, ZE  Directorate of Contracting, Attn: AFZJ-DC, P.O. Box 10039, 
Fort Irwin, CA 92310-0039
DAKF06, 1C  Directorate of Contracting, Attn: AFZC-DOC, Building 6222, 
Fort Carson, CO 80913-5022
DAKF10, 1D  Directorate of Contracting, Attn: AFZP-DC, Building 622, 2nd 
Floor, Fort Stewart, GA 31314-5189
DAKF11, 1E  Army Atlanta Contracting Center, Attn: AFLG-PRC, Building 
130, Anderson Way, Fort McPherson, GA 30330-6000
DAKF19, 1G  Directorate of Contracting, Attn: AFZN-DOC, P.O. Box 2248, 
Fort Riley, KS 66442-0248
DAKF23, 1H  Directorate of Contracting, Attn: AFZB-DOC, Building 2174, 
13\1/2\ and Indiana Streets, Fort Campbell, KY 42223-1100
DAKF24, G1  Directorate of Contracting, Attn: AFZX-DOC, P.O. Drawer 
3918, Fort Polk, LA 71459-5000
DAKF29, 2G  Directorate of Contracting, Attn: AFZT-DOC, Building 5418, 
3rd Floor, South Scott Plaza, Fort Dix, NJ 08640-6150
DAKF31, 1K  Directorate of Contracting, Attn: AFRC-FMD-DOC, Building 
227, Fort Devens, MA 01433-5340
DAKF36, 1M  Directorate of Contracting, Attn: AFZS-DOC, 45 West Street, 
Fort Drum, NY 13602-5220

[[Page 640]]

DAKF40, 1N  Directorate of Contracting, Attn: AFZA-DC, Drawer 70120, 
Fort Bragg, NC 28307-0120
DAKF48, 1Q  Headquarters, III Corps and Fort Hood, Directorate of 
Contracting, Attn: AFZF-DOC, Building 1001 (Room W103), Fort Hood, TX 
76544- 5059
DAFK57, 1T  Directorate of Contracting, Attn: AFZH-DOC, Building 9504, 
Box 339500, Fort Lewis, WA 98433-9500
DAKF61, 1U  Directorate of Contracting, Attn: AFRC-FM-DC, Building 2103, 
8th Avenue, Fort McCoy, WI 54656-5000
DAKF63, 9R  Directorate of Contracting, Los Alamitos, 1120 Lexington 
Drive, Los Alamitos, CA 90720-5002
DAMA01, G8  Superintendent, USA Military Academy, Attn: MADC, Building 
667A, West Point, NY 10996-1594
DAMD17, B3  U.S. Army Medical Research Acquisition Activity, Attn: MCMR-
AAA, Fort Detrick, Frederick, MD 21702-5014
DAMT01, 0E  HQ MTMC, Acquisition Division, Attn: MTAQ-A, 5611 Columbia 
Pike, Falls Church, VA 22041-5050
DAMT02, G3  MTMC Eastern Area, Contracting Division, Attn: MTELO-C, 
Building 42/7, Bayonne, NJ 07002-5302
DAMT03, G4  MTMC, Western Area, Commander, Attn: MTWLO-CO, Building 1, 
Alaska Street, Room 2336, Oakland, CA 94626-5000
DASA01, G0  USA Central Command-Saudi Arabia, Dhahran, Saudi Arabia, 
Attn: ARCENT-SA-CN, APO AE 09808
DASA02  USA Central Command-Kuwait, Camp Doha, Kuwait, Attn: ARCENT-KU-
KO, APO AE 09889-9900
DASA03  ARCENT Contracting Division, Attn: ARFD-PARC, Building 363, Fort 
McPherson, GA 30330-7000
DASA04  USA Central Command-Qatar, Doha, Qatar, Attn: ARCENT-QA-DOC, APO 
AE 09898
DASC01, YJ  USAINSCOM Support Battalion (Prov), Directorate of 
Contracting Operations, Attn: IASB-DCO, 8825 Beulah Street, Fort 
Belvoir, VA 22060-5246
DASC02, 1B  National Ground Intelligence Center (NGIC), Attn: IANG-LOG, 
220 Seventh Street NE, Charlottesville, VA 22902-5396
DASG60, CB  USA Space and Strategic Defense Command, Deputy Commander, 
Attn: CSSD-CM-AC, P.O. Box 1500, Huntsville, AL 35807-3801
DASG62, CH  U.S. Army Space Command, Attn: MOSC-SC, 1670 North Newport 
Road, Suite 211, Colorado Springs, CO 80916-2749
DASW01, F7  Defense Supply Service--Washington, Attn: Policy and 
Compliance, 5200 Army Pentagon, Room 1E260, Washington, DC 20310-5200
DATM01, 0R  U.S. Army OPTEC Contracting Activity, Attn: CSTE-ZOC, P.O. 
Box Y, Fort Hood, TX 76544-5065

                  PART 3--NAVY ACTIVITY ADDRESS NUMBERS

    * An asterisk indicates a two-digit code of a major command, which 
is shared with subordinate activities. Such subordinate activities will 
indicate the Unit Identification Code of the major command in 
parentheses, e.g. (MAJ00011).

N00011--LB*, LBZ
    Chief of Naval Operations, Washington, DC 20350-2000
N00012--HX*, V8*, V8Y
    Assistant for Administration, Under Secretary of the Navy, 
Washington, DC 20350
N00013--MR
    Judge Advocate General, Navy Department, 200 Stovall Street, 
Alexandria, VA 22332
N00014--EE*, EE0-9
    Office of Naval Research, Arlington, VA 22217
N00015--L0*, L0Z
    Naval Intelligence Command HQ, (Suitland, MD), 4600 Silver Hill 
Road, Washington, DC 20389
N00018--MC*, MD*, J5*, QA*, MCZ
    Bureau of Medicine and Surgery, Washington, DC 20372-5120
N00019--EF*, GU*, EF0-9
    Naval Air Systems Command, 1421 Jefferson Davis Highway, Arlington, 
VA 22243-5120
N00022--ML*, MQ*, NV*, MLZ
    Chief of Naval Personnel, Washington, DC 20370-2000
N00023--4J*, L5*, 4J0-9
    Naval Supply Systems Command, 1931 Jefferson Davis Highway, 
Arlington, VA 22241-5360
N00024--EH*, U0*, EH0-9
    Naval Sea Systems Command, 2531 Jefferson Davis Highway, Arlington, 
VA 22242-5160
N00025--EJ*, FZ*, EJ0-9
    Naval Facilities Engineering Command, 200 Stovall Street, 
Alexandria, VA 22332
N00030--EK*, EK0-9
    Strategic Systems Programs, 1931 Jefferson Davis Highway, Arlington, 
VA 22241-5362
N00033--EL*, EL0-9
    Commander, Military Sealift Command, Washington, DC 20390
    N00038 (MAJ00011)--LB-5
U.S. Commander-in-Chief, Pacific, HQ Support Division, Box 64017, Code 
          J145, Camp H.N. Smith, HI 96861-4017
N00039--NS*, NS0-9
    Space and Naval Warfare Systems Command, 2451 Crystal Drive, 
Arlington, VA 22245-5200
N00060--LH*, J0*, NM*, LHZ
    Commander-in-Chief, Atlantic Fleet, Norfolk, VA 23511
N00061--NL*, NLZ

[[Page 641]]

    Commander-in-Chief, U.S. Naval Forces, Europe, (London, U.K.), FPO 
AE 09499
N00062--8A*, L9*, R0*, 8A0-9
    Chief of Naval Education and Training, Code 013, NAS, Pensacola, FL 
32508-5100
N00063--NT*, NTZ
    Naval Computer and Telecommunications Command, 4401 Massachusetts 
Avenue NW., Washington, DC 20394-5290
N00065--S0*, S0Z
    Naval Oceanography Command, Stennis Space Center, Bay St. Louis, MS 
39529-5000
N00069--8Q*, 8QZ
    Naval Security Group HQ, 3801 Nebraska Avenue NW., Washington, DC 
20390-0008
N00070--LP*, V5*, 4L*, LPZ
    Commander in Chief, Pacific Fleet, NAVBASE, Pearl Harbor, HI 96860-
7000
N00072--9T*, LC*, 9TZ
    Commander, Naval Reserve Force, Code 17, New Orleans, LA 70146
N00074--QH*, QHZ
    Naval Special Warfare Command, NAVPHIBASE Coronado, San Diego, CA 
92155
N00101--3R
    Naval Air Station, South Weymouth, MA 02190
N00102--EN
    Portsmouth Naval Shipyard, Portsmouth, NH 03801
N00104--EP, EQ
    Naval Inventory Control Point, 5450 Carlisle Pike, Box 2020, 
Mechanicsburg, PA 17055-0788
N00105--JT
    Naval Medical Clinic, NAVSHIPYD, Portsmouth, NH 03801
N00109--F1
    Naval Weapons Station, Yorktown, VA 23491
N00123--ES
    Commanding Officer, Naval Regional Contracting Center, 937 N. Harbor 
Drive, San Diego, CA 92132-5106
N00124--M5
    Naval War College, Newport, RI 02840
N00127--H1
    Naval Air Station, Quonset Point, RI 02819
N00128--EU
    Supply Department, Naval Administrative Command, Naval Training 
Station, Great Lakes, IL 60088
N00129--EV
    Submarine Base, New London, Groton, CT 06340
N00140--EX, LA
    Commanding Officer, Naval Regional Contracting Center, Naval Base 
Bldg. No. 600, Philadelphia, PA 19112
N00146--QK
    Marine Corps Air Station, Cherry Point, NC 28533
N00151--EY
    Philadelphia Naval Shipyard, Philadelphia, PA 19112
N00153--N0
    Governor, Naval Home, 01800 East Beach Blvd., Gulfport, MS 39501
N00158--3V
    Naval Air Station, Willow Grove, PA 19090
N00161--FA
    Naval Academy, Annapolis, MD 21402
N00162 (MAJ00018)--MDG-H
    Naval Medical Clinic, Annapolis, MD 21402-5050
N00163--FB
    Naval Air Warfare Center, Aircraft Division Indianapolis, 21st and 
Arlington Avenue, Indianapolis, IN 46218
N00164--FC
    Naval Surface Warfare Center, Crane Division, Crane, IN 47522
N00166 (MAJ00072)--LC0-1
    Naval Air Facility, Bldg 3086, Andrews AFB, Washington, DC 20396-
5130
N00167--FD
    Naval Surface Warfare Center, Carderock Division, Bethesda, MD 
20084-5000
N00168--FE
    National Naval Medical Center, National Capital Region, Bethesda, MD 
20014
N0017A
    Atlantic Fleet Weapons Training, Facility (Code 51) (Roosevelt 
Roads, PR), Naval Station, Box 3023, FPO AA 34051
N00171--N5
    HQ, Naval District Washington, Washington Navy Yard, Washington, DC 
20374
N00173--FF
    Naval Research Laboratory, Washington, DC 20390
N00174--FG
    Naval Surface Warfare Center, Indian Head Division, Indian Head, MD 
20640
N00178
    Naval Surface Warfare Center, Dahlgren Division, Dahlgren, VA 22448
N00181--FJ
    Norfolk Naval Shipyard, Portsmouth, VA 23709
N00183--JX
    Commanding Officer, Naval Hospital, Portsmouth, VA 23708-5100
N00187--3J
    Navy Public Works Center, Norfolk, VA 23511
N00188--H2
    Naval Air Station, Norfolk, VA 23511
N00189--FK, H3
    Naval Supply Center, Norfolk, VA 23512
N00191--FL
    Charleston Naval Shipyard, Naval Base, Charleston, SC 29408
N00193 (MAJ00024)--EHD-G
    Commanding Officer (Code 11), Naval Weapons Station, Charleston, SC 
29408-7000
N00196--3K

[[Page 642]]

    Commanding Officer (Code 60), Naval Air Station, Atlanta, Marietta, 
GA 30060
N00197--FM
    Naval Surface Warfare Center, Naval Ordnance Station, Crane 
Division, Louisville, KY 40214
N00203 (MAJ00018)--MCL
    Commanding Officer, Naval Hospital, Pensacola, FL 32512
N00204--FN
    Naval Air Station (Code 19P10), Pensacola, FL 32508
N00205--FP
    Naval Support Activity (Code N443), New Orleans, LA 70146
N00206
    Naval Air Station, New Orleans, LA 70146
N00207--FQ
    Naval Air Station, Jacksonville, FL 32212
N00211 (MAJ00018)--MCQ-S
    Naval Hospital, Great Lakes, IL 60088-5230
N00213--H4
    Naval Air Station, Key West, FL 33040
N00215--3W
    Naval Air Station (Code 60), Dallas, TX 75211
N00216--FR
    Commanding Officer (Code 194), Naval Air Station, Bldg 10, Corpus 
Christi, TX 78419
N00221--K5
    Mare Island Naval Shipyard, Vallejo, CA 94592
N00228--FU
    Naval Supply Center, Oakland, CA 94625
N00231
    Commanding Officer, Naval Medical Clinic, Quantico, VA 22134
N00232 (MAJ00018)--MCB-F
    Naval Hospital, Jacksonville, FL 32214-5222
N00236--NX
    Naval Air Station, Alameda, CA 94501
N00244--NW
    Naval Supply Center, Naval Base, 937 North Harbor Drive, San Diego, 
CA 92132
N00245 (MAJ00070)--LPN
    Naval Station, San Diego, CA 92136-5000
N00246--H5
    Naval Air Station, North Island, San Diego, CA 92135
N00247--HC
    Naval Training Center, San Diego, CA 92133
N00249
    Commanding Officer, Civil Engineer Support Office, Naval 
Construction Battalion Center, Port Hueneme, CA 93043
N00250--FW
    Commander, Navy Exchange Service Command, NAVSTA New York, Staten 
Island, NY 10305
N00251--FX
    Puget Sound Naval Shipyard, Bremerton, WA 98314
N00253--FY
    Commanding Officer, Naval Undersea Warfare Center, Division Keyport, 
Keyport, WA 98345
N00255 (MAJ00070), LPS-T--LPW-Y
    Naval Station Puget Sound, Seattle, WA 98115-5000
N00267 (MAJ00018)--MC0-1
    Commanding Officer, Navy Medical Clinic, Key West, FL 33040
N00274 (MAJ00072)--LCA-B
    Naval Air Facility, Detroit, Selfridge Air Force Base, Supply 
Department, Mt. Clemens, MI 48045
N00275--3M
    Naval Air Station, Glenview, IL 60026
N00276
    Naval Air Station, Twin Cities, Minneapolis, MN 55450
N00281 (MAJ00062)--L90-1
    Commanding Officer, Fleet Combat Training Center, Atlantic, Dam 
Neck, Virginia Beach, VA 23461
N00285 (MAJ00018)--MDR
    Commanding Officer, Naval Hospital, Corpus Christi, TX 78419
N00288
    Naval Publications and Forms Center, 5801 Tabor Avenue, 
Philadelphia, PA 19120
N00296--NY
    Naval Air Station, Moffett Field, CA 94035
N00311--GA
    Pearl Harbor Naval Shipyard, Box 400 Pearl Harbor, HI 96860
N0031A (MAJ00060), J0K-M--JOY-Z
    Commander, Naval Special Warfare Group Two, Naval Amphibious Base, 
Little Creek, Norfolk, VA 23521-5340
N00314--M7
    Submarine Base, Pearl Harbor, HI 96860
N00334--N6
    Naval Air Station, Barbers Point, HI 96862
N00383, GB, GC
    Naval Inventory Control Point, 700 Robbins Avenue, Philadelphia, PA 
19111-5098
N00389, KL--MM
    Contracting Officer (Code 192), U.S. Naval Station (Roosevelt Roads, 
PR), Box 3002, FPO AA 34051
00391, EP, EQ, GB, GC
    Naval Inventory Control Point, 700 Robbins Avenue, Philadelphia, PA 
19111-5098
N00406--GE
    Naval Supply Center, Puget Sound, Bremerton, WA 98314
N00421--M8
    Naval Air Warfare Center, Aircraft Division, Patuxent River, MD 
20670
N00600--GG
    Naval Regional Contracting Center, Washington Navy Yard, Washington, 
DC 20374
N00604--NQ
    Naval Supply Center, Pearl Harbor, Pearl Harbor, HI 96860
N00612--GH
Commanding Officer, Naval Supply Center, RCD, Code 200M, Charleston, SC 
          29408
N00619 (MAJ00018)--QA0-9
    Naval Hospital Oakland, CA 94627-5000
N00620--H6

[[Page 643]]

    Naval Air Station, Whidbey Island, Oak Harbor, WA 98277
N00639--H7
    Commanding Officer, Naval Air Station, Memphis (84), Millington, TN 
38054
N00702 (MAJ00069)--8QM-N
    Naval Security Group Activity, Winter Harbor, ME 04693
N00743--8N
    Commanding Officer, Naval Computer and Telecommunications Station 
(Roosevelt Roads, PR), Box 3022, FPO AA 34051
N00788 (MAJ00063)--NTR-S
    Commanding Officer, Naval Communications Det., Washington, 
(Cheltenham, MD), Washington, DC 20390
N00849 (MAJ00069)--8QC
    Naval Security Group Activity, Skaggs Island, Sonoma, CA 95476-5000
N00886--QB
    Naval Communications Station, San Francisco, Rough and Ready Island, 
Stockton, CA 95203
N00950--8R
    Naval Computer and Telecommunications Area, Master Station, EASTPAC, 
Wahiawa, HI 96786
N0417A (MAJ00025)--EJA
    Naval Support Facility, P.O. Box 1000, Thurmont, MD 21788
N0428A--3Q
    Naval Air Station, Patuxent River, MD 20670
N0429A--3A
    Naval Air Warfare Center, Weapons Division, Point Mugu, CA 93042
N0434A (N00022)--MQL
    United States Navy Band, Washington Navy Yard, Washington, DC 20374-
1052
N0463A (MAJ00024)--EHC
    Commanding Officer, Navy Experimental Diving Unit, NAVCOASTSYSCEN, 
Bldg. 321, Panama City, FL 32401
V04697 (MAJ00060)--LHA
    USS Simon Lake, FPO AA 34085-2590
N0597A (MAJ00012)--HXP-W
    Director, Office of Civilian Personnel Management, Southeast Region, 
Bldg A-67, Naval Base, Norfolk, VA 23511-6098
N0598A (MAJ00012)--HXN
    Director, Office of Civilian Personnel Management, Pacific Division, 
Box 119, Pearl Harbor, HI 96860-5060
N0604A (MAJ00012)--HXJ-L
    Director, Office of Civilian Personnel Management, Northwest Region, 
2890 North Main Street, Suite 301, Walnut Creek, CA 94596-2739
N0605A (MAJ00012)--HXG-H
    Director, Office of Civilian Personnel Management, Northeast Region, 
Bldg 75-3 Naval Base, Philadelphia, PA 19112-5006
N0610A (MAJ00062)--L98
    Commanding Officer, Naval Diving and Salvage Training Center, 350 
South Crag Road, Panama City, FL 32407-7016
N0618A (MAJ00062)--8AE
    School of Music, Naval Amphibious Base, Little Creek, Norfolk, VA 
23521-5240
N0619A--8E
    Naval Health Sciences Education & Training Command, NAVMEDCOM 
NATCAPREG, Bethesda, MD 20814
N0708A (MAJ00024)--U0A-B
    Naval Warfare Engineering Activity, Port Hueneme Division, Naval 
Surface Warfare Center, Yorktown, VA 23961-5076
N08939
    Navy Section, US Military Group (Caracas, Venezuela), Department of 
State, Washington, DC 20521
N09534
    Navy Section, US Military Group (Lima, Peru), APO AA 34031
N09550--4G
    Commander Fleet Air Mediterranean (Naples, Italy), FPO AE 09619
N30492 (MAJ00039)--NSC
    David W. Taylor Naval Ship Research and Development Center 
Detachment Puget Sound, Bremerton, WA 98324-5215
N30776--4N
    Naval Air Station, Kingsville Auxiliary Landing Field Detachment, 
Orange Grove, TX 77630
N30779--3Z
    Naval Auxiliary Landing Field, Goliad, TX 77963
N30829 (MAJ00061)--NL0-2
    Officer in Charge, Naval Support Activity, Naples Detachment (Gaeta, 
Italy), FPO AE 09609
N30929
    Commanding Officer, Navy Flight Demonstration Squadron (Blue 
Angels), Naval Air Station, (Attn: Supply Officer), Pensacola, FL 32508
N31149 (MAJ00024)--EHA-B
    Naval Sea Logistics Center Detachment, Philadelphia Naval Base, 
Philadelphia, PA 19112-5061
N31699 (MAJ00012)--V8Z
    Office of Under Secretary of the Navy, Washington, DC 20350-1000
N31863
    Director, Naval Audit Service, Capital Region, P.O. Box 1206, Falls 
Church, VA 22041
N31954 (MAJ00062)--R0X
    Submarine Training Facility, San Diego, CA 92106
N32525--8S
    U.S. Naval Communication Station, Naples Detachment (Sigonella, 
Italy), FPO AE 09627
N32778 (MAJ00070)--4LE
    Fleet Activities, Chinhae (Korea), FPO AP 96269-1100
N32832--7K
    Naval Aviation Logistics Center, European Repair and Rework, 
Activity Representative (Alverca, Portugal), APO AE 09642
N32960--K2

[[Page 644]]

    Navy Support Office, La Maddalena (Sardinia Italy), FPO AE 09612
N33137 (MAJ00015)--L0A-C
    Naval Intelligence Operations Group DET CTG 168.4 (Munich, Germany), 
APO AE 09108
N35316 (MAJ00060)--J0G
    Patrol Combatant Missile Squadron Two, Mobile Logistic Support 
Group, Trumbo Point Annex, NAS Key West, FL 33040
N35949 (MAJ00018)--J5S
    Naval Hospital, Twentynine Palms, CA 92278-5008
N39088 (MAJ00022)--NVF
    Navy Recruiting Orientation Unit, 206 South Avenue, Suite C, 
Pensacola, FL 32508-5102
N39167
    Commanding Officer, Naval Branch Medical Clinic, Naval Air Station, 
Meridian, MS 39309
N39353--GV
    Commanding Officer, Integrated Combat Systems Test Facility, San 
Diego, CA 92152
N41756--LE
    Navy Engineering Logistics Office, Washington, DC 20000
N42237--7A
    Commanding Officer, Naval Submarine Base, Code N411, Kings Bay, GA 
31547
N43646 (MAJ00023)--4JB
    Defense Printing Service, Detachment Branch Office, 5403 Southside 
Drive, Louisville, KY 40214
N44405 (MAJ00062)--8AA
    Antilles Consolidated School System, Box 3200 (Roosevelt Roads, PR), 
FPO AA 34051
N44416 (MAJ00023)--4JL
    Defense Printing Service Northeast Area, 700 Robbins Avenue, 
Philadelphia, PA 19111-5093
N44930--KN
    Intra-Fleet Supply Support Operations Program, Norfolk, VA 23512
N44967--KP
    Naval Sea Systems Command Detachment (PERA CSS), San Francisco, CA 
94124-2995
N45045 (MAJ00012)--V8A
    Navy Comptroller Standard Systems Activity Det., Raleigh Oaks Plaza 
Office Building, 3606 Austin Peay Highway, Memphis, TN 38128-3757
N45405--HS
    Naval Sea Systems Command Det., PERA (Surface) Atlantic Office, 
Portsmouth, VA 23709-5000
N45406--LD
    Officer in Charge, Naval Sea Systems Command Detachment (PERA CV), 
Puget Sound Naval Shipyard, Bremerton, WA 98310-0206
N45411 (MAJ00070)--LPE
    Assault Craft #5, MCB Camp Pendleton, CA 92055-5003
N45534 (MAJ00024)--EHN
    AEGIS Combat Systems Center, Bldg D-11, Wallops Island, VA 23337
N45854 (MAJ00011)--LBE
    Fleet Surveillance Support Command, Chesapeake, Chesapeake, VA 
23322-5010
N46079
    Military Sealift Command Office, Northern Europe, (Bremerhaven, 
Germany), APO AE 09069-0006
N46450 (MAJ00023)--L50-9
    Naval Supply Center, Charleston Detachment, Naval Submarine Base, 
Kings Bay, GA 31547
N46531 (MAJ00012)--HX0-E
    Office of Civilian Personnel Management, National Capital Region, 
801 N. Randolph Street, Arlington, VA 22203
N46656--NP
    Telecommunication Management Detachment West, 937 North Harbor 
Drive, San Diego, CA 92132-5104
N46657 (MAJ00063)--NT0-NT1
    Telecommunication Management Detachment Pacific, Wahiawa, HI 96786-
3050
N46659--KJ
    Telecommunications Management Detachment Europe, (Naples, Italy), 
FPO AE 09620
N46904 (MAJ00060)--J00-1
    Commanding Officer, Precommissioned Unit, Antisubmarine Warfare 
Training Group Atlantic, Bldg CEP 104, Naval Station, Norfolk, VA 23511-
6495
N47408 (MAJ00025)--EJP-W
    Naval Facilities Engineering Command Contracts Office, Naval 
Construction Battalion Center, Port Hueneme, CA 93043-5000
N47427 (MAJ00070)--V5G
    Naval Air Pacific Repair Activity Detachment, New Zealand 
(Christchurch), c/o U.S. Naval Support Force Antarctic Det., FPO AP 
96531
N47875 (MAJ00019)--GUP-S
    Naval Technical Representative Detachment Bethpage, Grumman 
Aerospace Corporation, Bethpage, NY 11714-3593
N47876 (MAJ00019)--GUJ-L
    Naval Technical Representative Detachment Burbank, Lockheed 
Aeronautical Systems Company, P.O. Box 551, Burbank, CA 91503
N47877--GD
    Naval Technical Representative Detachment St. Louis, McDonnell 
Douglas Corporation, P.O. Box 516, St. Louis, MO 63166-0516
N47878 (MAJ00019)--GUV
    Naval Technical Representative Detachment Lynn, General Electric 
Company, Aircraft Engine Business Group, 1000 Western Avenue, Lynn, MA 
01910-0445
N47879 (MAJ00019)--GUO-B
    Naval Technical Representative Detachment Stratford, United 
Technologies

[[Page 645]]

Corporation, Sikorsky Aircraft Divison, Stratford, CT 06497
N48142 (MAJ00012)--V80-1
    Assistant Secretary of the Navy, Research Development and 
Acquisition, Washington, DC 20350-1000
N48398 (MAJ00070)--4LD
    Commander, U.S. Naval Forces Alaska, P.O. Box 25517, Juneau, AK 
99802-5517
N48521 (MAJ00019)--GUX
    Naval Technical Representative Detachment Bell, Bell Helicopter 
Textron, P.O. Box 482, Bldg. 2, Fort Worth, TX 76101
N48758 (MAJ00070)--V5R
    Naval Air Pacific Repair Activity Plant Rep. Office, Box 39, 
(Atsugi, Japan), FPO AP 96306
N48984 (MAJ00023)--L5E
    Defense Printing Service, Detachment Office, 901 South Drive, Scott 
Air Force Base, IL 62225-5106
N49399 (MAJ00060)--NM0-9
    Naval Submarine Support Facility, Supply Operations, New London, Box 
500, Groton, CT 06349-5500
N52731 (MAJ00072)--LCU
    Reserve Naval Construction Force, First Reserve Naval Construction 
Brigade Support Detachment, Naval Construction Battalion Center, Bldg 
121, Gulfport, MS 39501-5016
N52846 (MAJ00019)--EFA-B
    Naval Aviation Depot Operations Center Detachment, European Repair 
and Rework Activity (NERRA), (Naples, Italy), Box 50, FPO AE 09619
N52855--LZ
    Special Boat Unit 11, FPO AP 96601-4517
N53210 (MAJ00060)--LHJ-K
    Assault Craft Unit 2, Naval Amphibious Base, Little Creek, Norfolk, 
VA 23520
N53825--GY
    Naval Surface Force, US LANTFLT, Norfolk, VA 23511-6002
N53863 (MAJ00060)--LHH
    Commander, Surface Warfare Development Group, 2200 Amphibious Drive, 
Norfolk, VA 23521-2850
N53999 (MAJ00060)--J0Q-R
    Seal Team Six, Naval Amphibious Company, Norfolk, VA 23521
N55105 (MAJ00060)--NMC
    Amphibious Construction Batallion Two, 1815 Seabee Drive, Norfolk, 
VA 23701
N55131 (MAJ00060)--J0A-B
    Cargo Handling and Port Group, Williamsburg, VA 23187-5792
N55271 (MAJ00070)--LP8
    Commander, Combat Logistics Group One (N716), Building 221-2W, NSC, 
Oakland, CA 94625-5309
N55322 (MAJ00060)--LHN
    Explosive Ordnance Disposal Group Two, Fort Story, VA 23459-5024
N55418 (MAJ00070)--V50
    Naval Antarctic Support Unit, (Christchurch, New Zealand), FPO AP 
96531
N57007--VO
    Commander, Middle East Force, (Jufair, Bahrain), FPO AE 09834
N57012--GQ
    Commander Naval Air Force, U.S. Atlantic Fleet, Naval Air Station, 
Norfolk, VA 23511
N57016 (MAJ00060)--J0N
    Commander Submarine Force, U.S. Atlantic Fleet, Norfolk, VA 23511-
6296
N57023--GT
    Commander, Operational Test and Evaluation Force, Naval Base, 
Norfolk, VA 23511
N57032 (MAJ00061)--NLF-H
    Naval Air Facility, (Mildenhall, UK), FPO AE 09459
N57049 (MAJ00060)--JOE-F, V-X
    Naval Support Facility (Antigua, West Indies), FPO AA 34054
N57053 (MAJ00070)--LPQ
    Naval Facility, Centreville Beach, Ferndale, CA 95536-9766
N57070 (MAJ00060)--LH7
    Commander, Undersea Surveillance, U.S. Atlantic Fleet, Norfolk, VA 
23511-6687
N57075 (MAJ00060)--LH9
    Commanding Officer, Naval Facility (Argentia, Canada), FPO AE 09730
N57092 (MAJ00070)--V5U
    Naval Inshore Undersea Warfare Group One, Building 184, Box 
357140NOLF, Imperial Beach, CA 92135-7140
N57095 (MAJ00060)--LH0-1
    Atlantic Fleet Headquarters Support Activity, CINCLANTFLEET, 
Norfolk, VA 23511
N57100 (MAJ00070)--LP0-1
    Naval Special Warfare Group One, NAVPHIBASE Coronado, San Diego, CA 
92155
N60002 (MAJ00018)--QAD
    Commanding Officer, Naval Hospital, Millington, TN 38054
N60028--QC
    Naval Station, Treasure Island, San Francisco, CA 94130
N60036--QD
    Naval Weapons Station, Concord, CA 94520
N60042 (MAJ00070)--LPU
    Naval Air Facility, El Centro, CA 92243
N60050--HD
    Marine Corps Air Station, El Toro, Santa Ana, CA 92709
N60087--3P
    Naval Air Station, Brunswick, ME 04011
N60169--W0
    Commanding Officer, Marine Corps Air Station, Beaufort, SC 29904
N60191--4A
    Naval Air Station, Oceana, Virginia Beach, VA 23460
N60200--3G
    Commanding Officer, Naval Air Station, Cecil Field, FL 32215
N60201--L7

[[Page 646]]

    Commanding Officer, Naval Air Station, P.O. Box M, Mayport, FL 32228
N60211--3D
    Naval Auxiliary Landing Field, Crows Landing, CA 95313
N60234--4R
    Naval Air Station, Whiting Field, OLF Saufley Field, Pensacola, FL 
32508
N60241--3X
    Commanding Officer, Naval Air Station, Bldg. 2701, Kingsville, TX 
78363
N60258--GK
    Long Beach Naval Shipyard, Long Beach, CA 90801
N60259--H9
    Naval Air Station, Miramar, San Diego, CA 92145-5000
N60268 (MAJ62980)--MQ0-1
    Navy Recruiting District Chicago, Glenview, IL 60026-5200
N60376--3Y
    Commanding Officer, Naval Air Station, Chase Field, Beeville, TX 
78103
N60462--WE
    Naval Air Station, Adak (Alaska), FPO AP 98506-1200
N60478--3C
    U.S. Naval Weapons Station, Earle, Colts Neck, NJ 07722
N60495--3T
    Naval Air Station, Fallon, NV 89406
N60508--4Q
    Commanding Officer, Naval Air Station, Whiting Field, Milton, FL 
32570
N60514--GL
    Commanding Officer, Naval Station (Guantanamo Bay, Cuba), Box 33, 
FPO AE 09593
N60530--GM
    Naval Air Warfare Center, Weapons Division, China Lake, CA 93555
N60656--GN
    Navy Exchange, Naval Station, Annapolis, MD 21402
N60663--GR
    Officer in Charge, Navy Resale Activity, Commissary Support Office, 
Naval Base, Bldg 2600, Great Lakes, IL 60088
N60666--GS
    Navy Exchange, Naval Air Station, Key West, FL 33040
N60676--GX
    Navy Resale and Services Support Office, Field Support Office 
Commissary Div., Naval Air Station, Mechanicsburg, PA 17055
N60681--HA
    Commissary OPS Division, NAVRESSOFSO, Naval Station, San Diego, CA 
92136
N60693--HB
    Navy Resale Activity, Commissary Support Office, Naval Base Pearl 
Harbor, Box 110, Pearl Harbor, HI 96860
N60701--4M
    Naval Weapons Station, Seal Beach, CA 90740
N60865 (MAJ00070)--V5X
    Naval Forces, Marianas (Guam), FPO AP 96540
N60872 (MAJ00070)--V5T
    Naval Magazine (Guam) FPO AP 96540-1300
N60895--HF
    Commissary OPS Division, NAVRESSOFSO, Naval Air Station, Alameda, CA 
94501
N60921 HG--FH
    Commander, Naval Surface Warfare Center, Dahlgren Division, 
Detachment White Oak, 10901 New Hampshire Avenue, Silver Spring, MD 
20903
N60935--HH
    Commissary OPS Div, NAVRESSOFSO, Naval Air Station, Jacksonville, FL 
32212
N60936--HJ
    Navy Resale Activity Commissary Support Office, Naval Air Station, 
Pensacola, FL 32508
N60937--HK
    Navy Exchange Det., Naval Support Activity, New Orleans, LA 70140
N60938--HL
    Navy Resale Activity, Commissary Support Office, Naval Air Station, 
Corpus Christi, TX 78419
N60939--HM
    Navy Exchange, Naval Air Station, Memphis 32, Millington, TN 38054
N60951 (MAJ00060)--LHU
    Fleet Accounting and Disbursing Center, Operating Forces Accounting, 
U.S. Atlantic Fleet, Norfolk, VA 23511-6096
N60956 (MAJ00012)--V8J-N
    Navy Regional Finance Center, Great Lakes, IL 60088-5797
N61115--HN
    Navy Exchange Activity, Submarine Base, New London, Groton, CT 06340
N61119--HP
    Naval Supply Depot, Guam, PSC 455, Box 190, FPO AP 96540-1500
N61165--NN
    Supply Officer, Bldg NS46, Naval Station, Charleston, SC 29408-5000
N61174--7B
    Naval Station, New York, Brooklyn, NY 11251
N61189 (MAJ00060)--J0T
    Naval Station, Philadelphia, PA 19112
N61217--HQ
    Navy Exchange, Naval Air Station, Bermuda, FPO AE 09727
N61331--HR
    Naval Surface Warfare Center, Dahlgren Division, Coastal Systems 
Station, Panama City, FL 32407
N61337--H0
    Commanding Officer, Naval Hospital, Beaufort, SC 29904
N61339--HT
    Commanding Officer, Naval Training Systems Center (N-601), 12350 
Research Parkway, Orlando, FL 32826-3275
N61414--4B

[[Page 647]]

    Naval Amphibious Base, Little Creek, Norfolk VA 23521
N61463 (MAJ00060)--LHB-D, LH2-4
    Supply Officer, COMNAVBASE Supply, 1530 Gilbert Street, Suite 8, 
Norfolk, VA 23511-2793
N61466
    Commander, Naval Base, Bldg NH48, Charleston, SC 29408
N61510--HU
    Navy Exchange, Naval Station (Guam), Box 179, FPO AP 96540
N61533--HW
    David W. Taylor Naval Ship Research and Development Laboratory, 
Annapolis, MD 21402
N61564--FS
    Naval Hospital, NAVBASE (Guantanamo Bay, Cuba), FPO AE 09593
N61577 (MAJ00070)--V5P
    Naval Air Station, Agana (Guam), Box 60, FPO AP 96540-1200
N61581 (MAJ00070)--4LT
    Fleet Activities, Naval Base (Yokosuka, Japan), FPO AP 96349-1100
N61685 (MAJ00065)--S0A
    Naval Oceanography Command Center (Guam), Box 12, FPO AP 96540-2926
N61726--QL
    Naval Hospital, Naval Submarine Base, New London, Groton, CT 06349
N61751 (MAJ00018)--MCK,M,N,P
    Naval Medical Research Unit No. 3, Cairo (Egypt), PSC 452, Box 5000, 
FPO AE 09835-1600
N61755 (MAJ00070)--V5E
    Naval Station (Guam), FPO AP 96540-1000
N61762--HY
    Naval Ordnance Missile Test Station, White Sands Missile Range, NM 
88002
N62021--7V
    Naval Amphibious Base, Coronado, San Diego, CA 92155
N62161--HZ
    Navy Exchange Det, NAVCOMSTA, Rough and Ready Island, Stockton, CA 
95203
N62190 (MAJ00014)--EEY
    Commanding Officer, Naval Research Laboratory, Underwater Sound 
Reference Detachment, P.O. Box 8337, Orlando, FL 32856
N62191 (MAJ00062)--L97
    Commanding Officer, Naval Reserve Officers Training Corps, and Naval 
Administrative Unit, Room 20E-125, Massachusetts Institute of 
Technology, Cambridge, MA 02139
N62254 (MAJ00070)--4LX
    Commander Fleet Activities, Okinawa, Naval Air Facility, Kadena 
(Ryukyu Islands Southern), Box SU/CR, FPO AP 96370-1100
N62269--JC
    Commander, Naval Air Warfare Center, Aircraft Division Warminster, 
Warminster, PA 18974
N62271--QE
    Naval Postgraduate School, Monterey, CA 93940
N62285 (MAJ00065)--S00-1
    Naval Observatory, Washington, DC, 34th and Massachusetts Avenue, 
NW, Washington, DC 20390-5100
N62306--7C
    Commanding Officer (Code 4410), Naval Oceanographic Office, Stennis 
Space Center, Bay St. Louis, MS 39552
N62367 (MAJ00023)--4JC
    Navy Clothing and Textile Research Facility, 21 Strathmore Road, 
Natick, MA 01760-2490
N62376--4K
    Commanding Officer, Naval Air Warfare Center, Aircraft Division 
Trenton, P.O. Box 7176, Trenton, NJ 08628
N62381--JG
    Military Sealift Command, Atlantic, Military Ocean Terminal, 
Building 42, Bayonne, NJ 07002
N62382
    Military Sealift Command Office, Gulf Subarea, 4400 Dauphin Street, 
New Orleans, LA 70146
N62383--JH
    Military Sealift Command, Pacific, Naval Supply Center, Oakland, CA 
94625
N62387
    Commander, Military Sealift Command, Central Technical Activity 
(Code M10-3), 4228 Wisconsin Avenue, Washington, DC 20016
N62395--JK
    Navy Public Works Center, (Mariana Islands, Guam), FPO AP 96540-2937
N62401--3F
    Defense Printing Service Branch Office, The Pentagon, Washington, DC 
20350-3000
N62404--JJ
    Military Sealift Command, Far East, (Yokohama, Japan), FPO AP 96347
N62410 (MAJ00022)--MQ6
    Navy Recruiting District, P.O. Box 8667, Albuquerque, NM 87198-8667
N62412 (MAJ00022)--MLR
    Commanding Officer, Navy Recruiting District, Perry Hill Office 
Park, 3815 Interstate Court, Montgomery, AL 36109-5294
N62415 (MAJ00022)--MLX
    Commanding Officer, Navy Recruiting District, Strom Thurmond Federal 
Bldg., Suite 771, 1835 Assembly Street, Columbia, SC 29201-2430
N62416 (MAJ00022)--NV0-1
    Navy Recruiting District Columbus, Room 609 Federal Building, 200 
North High Street, Columbus, OH 44142-2474
N62419
    Commanding Officer, Navy Recruiting District, Melrose Bldg., 1121 
Walker Street, Houston, TX 77002
N62421 (MAJ00022)--MQM

[[Page 648]]

    Commanding Officer, Navy Recruiting District, 8925 North Meridian 
Street, Room 250, Indianapolis, IN 46260
N62422
    Commanding Officer, Navy Recruiting District, 2974 Woodcock Drive, 
Jacksonville, FL 32207
N62423
    Commanding Officer, Navy Recruiting District, 301 Center Street, 
Little Rock, AR 72201
N62425 (MAJ00022)--MQ8
    Commanding Officer, Navy Recruiting District, 1808 West End Avenue, 
Suite 1312, Nashville, TN 37203
N62427 (MAJ00022)--MLP
    Navy Recruiting District Omaha, Overland-Wolf Building, 6910 
Pacific, Omaha, NE 68106
N62429 (MAJ00022)--MLE
    Navy Recruiting District Portland, 1220 SW Third Avenue, Suite 576, 
Portland, OR 97204
N62430
    Commanding Officer, Navy Recruiting District, 1001 Navaho Drive, 
Raleigh, NC 27609
N62432 (MAJ00022)--MQG
    Navy Recruiting District, St. Louis, 1222 Spruce Street, St. Louis, 
MO 63103-2814
N62435 (MAJ00022)--MQE
    Navy Recruiting District Boston, 495 Summer Street, Boston, MA 
02210-2103
N62437 (MAJ00022)--MQ4
    Commanding Officer, Navy Recruiting District, 918 So. Ervay Street, 
Dallas, TX 75201
N62438 (MAJ00022)--MLQ
    Navy Recruiting District Denver, Capital Life Center, 3rd Floor, 
1600 Sherman Street, Denver, CO 80203-1668
N62440 (MAJ00022)--MLT
    Navy Recruiting District, 2420 Broadway, Kansas City, MO 64108
N62441 (MAJ00022)--MLG
    Navy Recruiting District Los Angeles, 5051 Rodeo Road, Los Angeles, 
CA 90016
N62442
    Commanding Officer, Navy Recruiting District Atlanta, 612 Tinker 
Street, Suite C, Marietta, GA 30060
N62443 (MAJ00022)--MLV
    Navy Recruiting District, Federal Office Building, 2nd & Washington 
Avenues, S., Minneapolis, MN 55401
N62444 (MAJ00022)--NVA
    Commanding Officer (Code 602-2C), Navy Recruiting District, 4400 
Dauphine Street, New Orleans, LA 70146
N62448 (MAJ00022)--MLN
    Navy Recruiting District San Francisco, 1500 Broadway, Room 210, 
Oakland, CA 94612-1430
N62449 (MAJ00022)--MLC
    Navy Recruiting District Seattle, Naval Station, Building 30, 
Seattle, WA 98115-5105
N62467--JM
    Commanding Officer, Naval Facilities Engineering Command, Southern 
Division, (SOUTHNAVFACENGCOM), 2155 Eagle Drive, P.O. Box 10068, 
Charleston, SC 29411-0068
N62470--JN
    Naval Facilities Engineering Command, Atlantic Division, Norfolk, VA 
23511
N62471--N7
    Officer in Charge of Construction, Naval Facilities Engineering 
Command, Contracts, Mid-Pacific, Pearl Harbor, HI 96860
N62472--JP
    Naval Facilities Engineering Command, Northern Division, 10 
Industrial Highway, Mail Stop # 82k Lester, PA 19113
N62474--JR
    Naval Facilities Engineering Command, Western Division, San Bruno, 
CA 94066
N62477--JU
    Naval Facilities Engineering Command, Chesapeake Division, 
Washington Navy Yard Washington, DC 20374
N62481--N8
    Naval Air Station (Bermuda), FPO AE 09727
N62507 (MAJ00070)--4LJ
    Commanding Officer, Naval Air Facility (Atsugi, Japan), Box 3, FPO 
AP 96306-1200
N62522--JV
    Military Sealift Command, Europe, (London, UK), Box 3, FPO AE 09499-
3700
N62535--HE
    Marine Corps Air Station (HELO), Tustin, CA 92710
N62537
    Military Sealift Command, Mediterranean Sub-Area, (Naples, Italy), 
Box 23, FPO AE 09619-0600
N62538--K1
    Military Sealift Command Office, Middle Atantic, NSC, Bldg Y100A, 
Norfolk, VA 23512
N62539
    Military Sealift Command Office, United Kingdom, (London, UK), Box 
29, FPO AE 09499-3700
N62573--K8
    Marine Corps Air Station, New River Plaza, Jacksonville, NC 28540
N62576 (MAJ00023)--4JG
    Defense Printing Service Branch Office, 700 Robbins Avenue, 
Philadelphia, PA 19111-5094
N62578--J2
    Naval Construction Battalion Center, Davisville, RI 02854
N62583--J3
    Naval Construction Battalion Center, Port Heuneme, CA 93041
N62585--K3

[[Page 649]]

    Commander, Naval Activities, United Kingdom, (London, UK), FPO AE 
09499
N62586 (MAJ00070)--V5A-B
    Naval Ship Repair Facility (Guam), FPO AP 96540
N62588--NR
    Naval Support Activity (Naples, Italy), FPO AE 09619
N62593
    Director, Defense Printing Service Det Office, Southeast Div., 4400 
Dauphine St., Unit 601-3-B, New Orleans, LA 70146
N62603
    Commanding Officer Fleet & Mine Warfare Training Center Naval Base, 
Bldg 647 Charleston, SC 29408
N62604--J4
    Commanding Officer, Naval Construction Battalion Center, Gulfport, 
MS 39501
N62613 (MAJ00027)--MUE
    Commanding Officer, Marine Corps Air Station, (Iwakuni, Japan), FPO 
AP 96310
N62638 (MAJ00072)--LCN
    Naval Inshore Undersea Warfare Group Two, NSC Cheatham Annex, Bldg. 
111, Williamsburg, VA 23187-8792
N62645--EG
    Naval Medical Logistics Command, Fort Detrick, Frederick, MD 21701-
5015
N62649--JY
    Naval Supply Depot (Yokosuka, Japan), FPO AP 96349
N62651
    Director, Defense Printing Service Office, Southeast Division, 
Pensacola, FL 32508
N62653 (MAJ00023)--4JW-X
    Director, Defense Printing Service Branch Office, Southeast 
Division, Bldg. 1628, Naval Base, Charleston, SC 29408
N62654 (MAJ00019)--EFE
    Naval Weapons Evaluation Facility, Kirtland AFB, Albuquerque, NM 
87117
N62661 (MAJ00062)--L97
    Naval Education and Training Center, Newport, RI 02841-5000
N62665--JQ
    Supervisor of Shipbuilding, Conversion, and Repair, USN, Barnes 
Building--6th Floor, 495 Summer Street, Boston, MA 02210
N62670--8B
    Supervisor of Shipbuilding, Conversion and Repair, USN, Drawer T, 
Mayport Naval Station, Jacksonville, FL 32228
N62673--8P
    Supervisor of Shipbuilding, Conversion and Repair, USN, Naval Base, 
Charleston, SC 29408
N62678--8C
    Supervisor of Shipbuilding, Conversion and Repair, USN, P.O. Box 
215, Portsmouth, VA 23705
N62686--T0
    Defense Printing Service Office, Naval District Washington, Building 
157-2, Washington Naval Yard, Washington, DC 20374-1572
N62688--GW
    Naval Station, Naval Base, Norfolk, VA 23511-6002
N62695
    Auditor General of the Navy, Naval Audit Services Headquarters, P.O. 
Box 1206, Falls Church, VA 22041
N62700 (MAJ00023)--4JJ
    Defense Printing Service Detachment Office, Northern Division, Bldg 
2A, Great Lakes, IL 60088-5708
N62703 (MAJ00023)--4JA
    Defense Printing Service Branch Office, Bldg 530, Puget Sound Naval 
Shipyard, Bremerton, WA 98314
N62705 (MAJ00023--4JN
    Defense Printing Service Detachment Office, Naval Supply Center, 
Oakland, CA 94625-5045
N62706--JS
    Defense Printing Service Branch Office, Western Division, Bldg. 154, 
San Diego, CA 92136-5148
N62707 (MAJ00023)--4JS-U
    Defense Printing Service Detachment Office, Western Area, Pearl 
Harbor, Box 126, Pearl Harbor, HI 96860-5120
N62735 (MAJ00070)--4LP
    Commander, Fleet Activities, (Sasebo, Japan), PSC 476, Box 1, FPO AP 
96322-1100
N62741--MB
    Commanding Officer, Navy Supply Corps School, Code 60, Athens, GA 
30606
N62742--KB
    Naval Facilities Engineering Command, Pacific Division, Pearl 
Harbor, HI 96860
N62745 (MAJ00025)--FZC-E
    Officer in Charge of Construction, Naval Facilities Engineering 
Command Contracts, Mediterranean (Madrid, Spain), APO AE 09642
N62755--J7
    Commanding Office, Navy Public Works Center, Pearl Harbor, HI 96860-
5470
N62757 (MAJ00072)--9TV-Y
    Naval Reserve Center, 7410 West Roosevelt Road, Forest Park, IL 
60130-2592
N62762 (MAJ00024)--EHU-W
    Navy Shipbuilding Liaison Office, Spain, Box 36, (Madrid, Spain), 
APO AE 09642
N62766--L1
    Officer in Charge of Construction, Naval Facilities Engineering 
Command Contracts (Guam), FPO AP 96540
N62786--ER
    Supervisor of Shipbuilding, Conversion and Repair, USN, 574 
Washington Street, Bath, ME 04530-0998
N62789--L8
    Supervisor of Shipbuilding, Conversion and Repair, USN, Groton, CT 
06340
N62791--NU

[[Page 650]]

    Supervisor of Shipbuilding, Conversion and Repair, USN, Naval 
Station, Box 119, San Diego, CA 92136-5119
N62793--4T
    Supervisor of Shipbuilding, Conversion and Repair, USN, Newport 
News, VA 23607-2785
N62794--7D
    Supervisor of Shipbuilding, Conversion and Repair, USN, Flushing & 
Washington Avenues, Brooklyn, NY 11251-9000
N62795--7F
    Supervisor of Shipbuilding, Conversion and Repair, USN, Pascagoula, 
MS 39568-2210
N62798--4X
    Supervisor of Shipbuilding, Conversion and Repair, USN, San 
Francisco, CA 94124-2996
N62799--7M
    Supervisor of Shipbuilding, Conversion and Repair, USN, Seattle, WA 
98115-5001
N62802 (MAJ00012)--V8P
    Naval Audit Service Northeast Region, 5 Executive Campus, Suite 200, 
Cherry Hill, NJ 08002-4104
N62808 (MAJ00025)--FZ0
    Public Works Center, Subic Bay (Luzon, Republic of the Philippines), 
FPO AP 96451-2900
N62816 (MAJ00023)--L5A-C
    Defense Printing Service Det. Br. Office (Naples, Italy), Box 108, 
FPO AE 09619
N62832
    Naval Activities (Rota, Spain), FPO AE 09645
N62836--L4
    Officer in Charge of Construction, Naval Facilities Engineering 
Command Contracts, Far East, Yokosuka, Box 61, FPO AP 96349
N62841 (MAJ00030)--EKA
    Commanding Officer, Naval Ordnance Test Unit, Cape Canaveral, FL 
32920-1623
N62844--K0
    Naval Imaging Command, Washington Navy Yard, Washington, DC 20350-
2000
N62849 (MAJ00019)--EFC
    Naval Aviation Engineering Service Unit, Philadelphia, PA 19112-5088
N62852
    Naval Electronic System Security Engineering Center, Naval Security 
Station, 3801 Nebraska Avenue, NW., Washington, DC 20390
N62856 (MAJ00060)--LHW-X
    Naval Air Facility (Lajes Azores, Portugal), APO AE 09720-5000
N62863--K4
    Naval Station (Rota, Spain), FPO AE 09645
N62864--L2
    Officer in Charge of Construction, Naval Facilities Engineering 
Command Contracts, Southwest Pacific (Manila, Philippines), APO AP 96440
N62892 (MAJ00069)--8QA
    Commanding Officer, Naval Security Group Activity, Site ``B'', Card 
Sound Road, Homestead, FL 33039-6428
N62894 (MAJ00070)--4LA
    Commander, U.S. Naval Forces Korea (Yongsan, South Korea), APO AP 
96205-0023
N62907--KG
    Naval Plant Representative Office, Applied Physics Laboratory, Johns 
Hopkins Road, Laurel, MD 20810
N62908--8D
    Naval Weapons Engineering Support Activity, Washington Navy Yard, 
Washington, DC 20374
N62911 (MAJ00022)--MQC
    Navy Recruiting Area One, Scotia, NY 12302-9462
N62913 (MAJ00022)--MLL
    Commander, Naval Recruiting Area Three, 451 College Street, P.O. Box 
4887, Macon, GA 31208-4887
N62915 (MAJ00022)--MQJ
    Navy Recruiting Area Five, Building 3, NTC, Great Lakes, IL 60088-
5135
N62917 (MAJ00022)--ML0-1
    Commander, Navy Recruiting Area Seven, 1499 Regal Row, Suite 501, 
Dallas, TX 75247
N62918 (MAJ00022)--MLA
    Naval Recruiting Area Eight, 7677 Oakport Street, Suite 650, Oakland 
CA 94621-1929
N62922--7W
    Resident Officer in Charge of Construction, Pacific, Department of 
the Navy, P.O. Box 418, San Bruno, CA 94067
N62954 (MAJ00022)--MQN
    Navy Recruiting District Cleveland, 17535 Rosbough Boulevard, 
Middleburgh Heights, OH 44130
N62974--JB
    Marine Corps Air Station, Yuma, AZ 85364
N62980 (MAJ00022)--MQR-Z
    Bureau of Naval Personnel, Washington, DC 20370-5000
N62990--L3
    Supervisor of Shipbuilding, Conversion and Repair, USN, P.O. Box 26, 
Sturgeon Bay, WI 54235
N62995--4H
    Naval Air Station, Sigonella (Italy), FPO AE 09627
N63005 (MAJ00011)--LBL-N
    Commanding Officer, Administrative Support Unit, Bahrain, FPO AE 
09834
N63007 (MAJ00060)--LHS
    Nuclear Weapons Training Group, Atlantic, Norfolk, VA 23511
N63015--7Y
    Naval Education and Training Support Center, Pacific, Fleet Station 
PO Bldg, San Diego, CA 92132
N63026 (MAJ00027)--MUJ
    Marine Corps Air Station (Futenma, Japan), FPO AP 96372-5001
N63028--U2

[[Page 651]]

    Polaris Missile Facility Atlantic, Charleston, SC 29408
N63032--KS
    U.S. Naval Station, Keflavik (Iceland), FPO AE 09728
N63038--8M
    U.S. Naval Computer and Telecommunications Station, Cutler, East 
Machias, ME 04630
N63042--NZ
    Naval Air Station, Lemoore, CA 93245
N63043--3S
    Commanding Officer, Naval Air Station, Meridian, MS 39301
N63051 (MAJ0004)--LB8
    Commanding Officer, Naval Investigative Service, Southeast Region, 
Naval Base, Building NH 53, Charleston, SC 29408-6425
N63053
    Commanding Officer, Naval Investigative Service Regional Office, 
P.O. Box 6438, New Orleans, LA 70174
N63055 (MAJ00011)--LBJ
    Naval Investigative Service, Mid-Atlanta Region Norfolk, 293 
Independence Blvd, Suite 525, Pembroke 5, Virginia Beach, VA 23462
N63058 (MAJ00011)--LBC
    Naval Investigative Service, Northwest Region, P.O. Box 4247, Walnut 
Creek, CA 94596
N63073 (MAJ00069)--8Q6-8
    U.S. Naval Security Group Activity RAF (Edzell UK), FPO AE 09419
N63080--KT
    Navy Resale Activity, Chinhae (South Korea), FPO AP 96269
N63082
    Commanding Officer, Naval Technical Training Center, Corry Station 
(Code 4460), Pensacola, FL 32511
N63110
    Commanding Officer, Chief of Naval Air Training (Code N-73), Naval 
Air Station, Corpus Christi, TX 78419
N63111
    Commanding Officer, Chief of Naval Technical Training, Naval Air 
Station, Memphis, Millington, TN 38054
N63124 (MAJ00024)--U00-9
    Supervisor of Shipbuilding, Conversion and Repair, USN, New Orleans, 
LA 70146
N63134--7R
    Fleet Numerical Oceanography Center, Monterey, CA 93940
N63135 (MAJ00023)--4JD-E
    Defense Printing Service Management Office, Washington, DC 20374-
1762
N63136
    Navy Section, U.S. Military Group, Argentina (Buenos Aires), 
Department of State, Washington, DC 20521
N63143--8K
    Naval Computer and Telecommunications Station (Keflavik, Iceland), 
Box 22, FPO AE 09728
N63152--GZ
    Fleet Combat Direction Systems Support Activity, San Diego, CA 
92147-5081
N63165--7U
    Navy Regional Data Automation Center, Washington, Washington Navy 
Yard, Washington, DC 20374
N63182--8T
    Naval Computer and Telecommunications Station (Rota, Spain), FPO AE 
09644
N63200 (MAJ00011)--LBB
    Commanding Officer, Naval Satellite Operations Center, Point Mugu, 
CA 93042-5013
N63204--KV
    Naval Plant Representative Office, Goodyear Aerospace Corp., Akron, 
OH 44305
N63209 (MAJ00062)--L9A
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of New Mexico, Albuquerque, NM 87106
N63210 (MAJ00062)--L9B
    Commanding Officer, Naval Reserve Officers Training Corps Unit, Iowa 
State University of Science and Technology, Ames, IA 50011-3010
N63211 (MAJ00062)--L9C
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Michigan, Ann Arbor, MI 48109-1085
N63212 (MAJ00062)--L9G
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Texas at Austin, Austin, TX 78712
N63213 (MAJ00062)--L9J
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of California, Berkeley, CA 94720-0001
N63214 (MAJ00062)--L9M
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Colorado, Box 374, Boulder, CO 80309-0374
N63215 (MAJ00062)--L9U
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Illinois Institute of Technology, 3300 S. Federal Street, Chicago, IL 
60616-3793
N63216 (MAJ00062)--L9W
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Missouri, Columbia, MO 65201
N63217 (MAJ00062)--L9Z
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Oregon State University, Corvallis, OR 97331
N63218 (MAJ00062)--ROB
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Northwestern University, Evanston, IL 60201
N63219 (MAJ00062)--R0E, L99
    Commanding Officer, Naval Reserve Officers Training Corps Unit, Rice 
University, P.O. Box 1892, Houston, TX 77001
N63220 (MAJ00062)--R0L
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
UCLA, Mens Gym Room 123, 405 Milgard Avenue, Los Angeles, CA 90024-1399
N63221 (MAJ00062)--8AB

[[Page 652]]

    Commanding Officer, Naval Reserve Officers Training Corps Unit, PED 
101, University Park MC 0654, University of Southern California, Los 
Angeles, CA 90089-0654
N63222 (MAJ00062)--R0H
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Kansas, Lawrence, KS 66044
N63223 (MAJ00062)--R0K
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Nebraska, Lincoln, NE 68508
N63224 (MAJ00062)--8AD
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Wisconsin, 1610 University Avenue, Madison, WI 53705
N63225 (MAJ00062)--8AH
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Marquette University, Milwaukee, WI 53233
N63226 (MAJ00062)--8AJ
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Minnesota, Minneapolis, MN 55455-0108
N63227 (MAJ00062)--8AK
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Idaho, Moscow, ID 83843-3244
N63228 (MAJ00062)--8AM
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Tulane University, New Orleans, LA 70118
N63229 (MAJ00062)--8AN
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Oklahoma, Norman, OK 73019
N63230 (MAJ00062)--8AR
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Notre Dame, Notre Dame, IN 46556-5601
N63231 (MAJ00062)--8AW
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Utah, Salt Lake City, UT 84112-1107
N63232 (MAJ00062)--8AY
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Washington, Seattle, WA 98195
N63234 (MAJ00062)--J9Q
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 505 
East Armory Street, University of Illinois, Champaign, IL 61820-6288
N63235 (MAJ00062)--R05
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Purdue University, West Lafayette, IN 47907-0001
N63273--4S
    Fleet Combat Direction Systems Support Activity, Dam Neck, Port 
Hueneme Division, Naval Surface Warfare Center, Virginia Beach, VA 23461
N63285 (MAJ00011)--LB0
    Naval Security and Investigative Command, Washington, DC 20388
N63290 (MAJ00062)--R00-1
    Commanding Officer, Combat Systems Technical Schools Command, Mare 
Island, Vallejo, CA 94592
N63291 (MAJ00062)--R0F
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Barton Hall, Cornell University, Ithaca, NY 14853
N63294 (MAJ00062)--8AV
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Rochester, Rochester, NY 14627
N63295 (MAJ00062)--R0M
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Rensselaer Polytechnic Institute, Troy, NY 12180-3590
N63296 (MAJ00062)--L9F
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Auburn University, Auburn, AL 36830
N63299 (MAJ00062)--R0A
    Commanding Officer, Naval Reserve Officers Training Corps Unit, Duke 
University, Durham, NC 27706
N63301 (MAJ00062)--L9D
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Georgia Tech, Atlanta, GA 30313
N63303 (MAJ00062)--R0U
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
College of the Holy Cross, Worcester, MA 01610-2389
N63306 (MAJ00062)--8AS
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Miami University, Oxford, OH 45056-1698
N63307 (MAJ00062)--R0N
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Mississippi, Box 69, University, MS 38677
N63308 (MAJ00062)--L9R
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of North Carolina, Chapel Hill, NC 27515
N63309 (MAJ00062)--L9Y
    Commanding Officer, Naval Reserve Officers Training Corps Unit, The 
Ohio State University, Columbus, OH 43210-1169
N63310 (MAJ00062)--R0P
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Wagner Bldg., The Pennsylvania State University, University Park, PA 
16802
N63311 (MAJ00062)--8AT
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Pennsylvania, Philadelphia, PA 19104
N63313 (MAJ00062)--L9X
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of South Carolina, Columbia, SC 29208
N63315 (MAJ00062)--8AL
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Vanderbilt

[[Page 653]]

University (Westside Hall), Nashville, TN 37240
N63316 (MAJ00062)--R0R
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Villanova University, Villanova, PA 19085-1699
N63317 (MAJ00062)--L9T
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Maury Hall, University of Virginia, Charlottesville, VA 22903-3194
N63325--7X
    Naval Education & Training Support Center, Atlantic, Bldg. Z-86, 
Naval Station, Norfolk, VA 23511
N63339--LL
    Navy Exchange, Naval Air Station, Adak (Alaska), FPO AP 96506
N63340--LM
    Navy Exchange, Newfoundland (Argentia, Canada), FPO AE 09730
N63341--LN
    Navy Exchange Det., Naval Air Station, Chase Field, Beeville, TX 
78102
N63344--LR
    Navy Commissary Store Region, Charleston, SC 29408
N63345--LS
    Navy Exchange, Naval Station, Guantanamo Bay (Cuba), FPO AE 09731
N63346--LT
    Navy Resale Activity, Commissary Support Office, Naval Station, 
Keflavik (Iceland), FPO AE 09728
N63348--LV
    Navy Exchange Det., Naval Air Station, Kingsville, TX 78364
N63349--LW
    Navy Exchange, Naval Air Station, Lemoore, CA 93246
N63350--3L
    Navy Exchange (Dunstable, UK), FPO AE 09499
N63351--LY
    Navy Commissary Store Region, Naval Station, Long Beach, CA 90802
N63352--KE
    Navy Exchange Det., Naval Air Station, Meridian, MS 39301
N63353--MA
    Officer in Charge, Navy Resale Activity, Commissary Support Office, 
Naval Support Activity, Naples (Italy), FPO AE 09619
N63357--ME
    Navy Exchange, Naval Station, Rota (Spain), FPO AE 09645
N63362--MK
    Officer in Charge, Navy Resale Activity, Commissary Support Office, 
Naval Station (Subic Bay, Philippines), P.O. Box 28, FPO AP 96451
N63365--MN
    Navy Resale Activity, Commissary Support Office (Yokosuka, Japan), 
Box 33, FPO AP 96349
N63367--MP
    Officer in Charge, Commissary OPS Div., Navy Resale and Services 
Support Office, Field Support Office, Norfolk, VA 23511
N63369
    Military Sealift Command Office, Benelux (Rotterdam, Netherlands), 
APO AE 09715
N63381 (MAJ00011)--LBA
    Joint U.S. Military Advisory Group, Thailand (Bangkok, Thailand), 
APO AP 96546
N63387--JD
    Navy Public Works Center, Naval Base, San Diego, CA 92136
N63394--L6
    Naval Surface Warfare Center, Port Hueneme Division, Port Hueneme, 
CA 93043
N63395--8L
    U.S. Naval Communication Station Thurso (Caithness, UK), FPO AE 
09418
N63402--K7
    Commanding Officer, Strategic Weapons Facility, Pacific, Bremerton, 
WA 98383
N63406 (MAJ00070)--V5C
    Naval Submarine Base San Diego, 140 Sylvester Road, San Diego, CA 
92106-3521
N63408--HV
    Navy Material Transportation Office, Norfolk, VA 23511-6691
N63410--KA
    Navy Manpower and Material Analysis Center, Atlantic, Norfolk, VA 
23511
N63427--8F
    U.S. Naval Communication Station, Harold E. Holt, Exmouth, Western 
Australia, FPO AP 96550
N63429--MH
    Naval Computer and Telecommunications Station London (UK), FPO AE 
09499
N63439--K9
    Naval Ophthalmic Support and Training Activity, Yorktown, VA 23690
N63543 (MAJ00072)--9TC
    Naval Reserve Center, 3070 Ross Lane, Central Point, OR 97502-1399
N63821 (MAJ00039)--NSA-B
    Officer in Charge, Naval Underwater Systems Center, AUTEC Andros 
Range Detachment (Andros Island, Bahama Islands), FPO AA 34058
N63886 (MAJ00069)--8Q0-1
    Naval Security Group Activity (Adak, AK), FPO AP 96505
N63891 (MAJ00069)--8QG
    Naval Security Group, Northwest, Chesapeake, VA 23322
N64165 (MAJ00062)--R0Z
    Naval Unit, Lowry Air Force Base, CO 80230
N64181 (MAJ00062)--R0W
    Department of Naval Science, Texas Maritime Academy, Galveston, TX 
77553-1675
N64267--M9
    Naval Warfare Assessment Center, Corona Annex, Corona, CA 91720
N64281--3U, KX

[[Page 654]]

    Commanding Officer, Naval Sea Combat Systems Engineering Station, 
Naval Station, Norfolk, VA 23511
N64356--KF
    Commanding Officer, Naval Administrative Command, Armed Forces Staff 
College, Norfolk, VA 23511-6097
N64980 (MAJ00061)--NLA-C
    Officer in Charge, Naval Weapons Facility, Detachment Machrihanish 
(UK), FPO AE 09422
N64981 (MAJ00061)--NL5-7
    Commanding Officer, Naval Weapons Facility, (St. Mawgan, UK), FPO AE 
09415
N65113--EZ
    Navy Public Works Center, Bldg 1A, Great Lakes, IL 60088-5600
N65114 (MAJ00025)--EJC
    Commanding Officer, Navy Public Works Center, Naval Air Station, 
Pensacola, FL 32508-6500
N65115 (MAJ00025)--FZA
    Navy Public Works Center, Box 13 (Yokosuka, Japan), FPO AP 96349-
3100
N65116--MZ
    Officer in Charge, Navy-Marine Corps Appellate Review Activity, 
Office of the Judge Advocate General, Washington Navy Yard, Washington, 
DC 20374-2001
N65146--7E
    Procurement Branch, OP-09B31, Office of the Chief of Naval 
Operations Support Activity, Washington, DC 20350
N65198--3H
    Naval Administrative Unit, 550 First Street, Idaho Falls, ID 83401
N65236--V7
    Naval Electronic Systems Engineering Center, 4600 Goer Road, North 
Charleston, SC 29406
N65256 (MAJ00012)--V8C
    Navy Office of Information, East, 133 East 58th Street, 1st Floor, 
New York, NY 10022
N65428 (MAJ00018)--MDP
    Commanding Officer, Naval Hospital (Roosevelt Roads, PR), FPO AA 
34051-8100
N65440--4V
    Officer in Charge, Navy Exchange, NAVCOMMSTA Harold E. Holt, 
(Exmouth, Australia), FPO AP 96550
N65491 (MAJ00018)--J5P
    Naval Hospital, (Subic Bay, Philippines), FPO AP 96452-1600
N65492 (MAJ00018)--MCA
    Commanding Officer, Naval Hospital, Fiscal & Supply Service, Code 
32C, Orlando, FL 32813-5200
N65497--4U
    Commissary OPS Division, NAVRESSO, Field Support Office, 2801 ``C'' 
Street, SW, Auburn, WA 98001
N65538 (MAJ00024)--U0D
    Naval Sea Logistics Center, 5450 Carlisle Pike, P.O. Box 2060, 
Mechanicsburg, PA 17055-0795
N65540 (MAJ00024)--EHP-S
    Naval Ship System Engineering Station, Carderock Division, Naval 
Surface Warfare Center Naval Base, Philadelphia, PA 19112-5083
N65575 (MAJ00018)--MCY
    Naval Medical Clinic, Seattle, WA 98115
N65576
    Navy Space Systems Activity, P.O. Box 92960, Worldway Postal Center, 
Los Angeles, CA 90009
N65580--M2
    Naval Electronic Systems Engineering Center, P.O. Box 55, 
Portsmouth, VA 23705
N65849 (MAJ00012)--HXY-Z
    Office of Civilian Personnel Management, Southwest Region, San 
Diego, CA 92188
N65870--M4
    Supervisor of Shipbuilding, Conversion and Repair, USN, Long Beach 
Naval Shipyard, Long Beach, CA 90822
N65886
    Commanding Officer, Aviation Depot, Naval Air Station, Jacksonville, 
FL 32212
N65888--ED
    Aviation Depot, North Island, San Diego, CA 92135
N65889
    Commanding Officer, Aviation Depot, Naval Air Station, Code 56000, 
Pensacola, FL 32508
N65912--GP
    Commanding Officer, Naval Sea Support Center, Atlantic, St. Juliens 
Creek Annex, Portsmouth, VA 23702
N65913--7L
    Naval Sea Support Center, Pacific, San Diego, CA 92138
N65918--FT
    Shore Intermediate Maintenance Activity, Naval Station, San Diego, 
CA 92136-5000
N65926 (MAJ00039)--NSA-B
    Officer in Charge, Naval Underwater Systems Center Detachment, AUTEC 
West Palm Beach, West Palm Beach, FL 33402
N65928 (MAJ00062)--N3
    Naval Training Center, Orlando, FL 32813
N65980 (MAJ00039)--NSL-N
    Naval Electronic Systems Engineering Activity, St. Inigoes, MD 20684
N65995--KM
    Officer in Charge, Naval Support Activity, (Holy Loch, UK), FPO AE 
09416
N66001--7N
    Naval Command Control and Ocean Surveillance Center, RDT&E Division, 
San Diego, CA 92152-5000
N66021--7G
    Naval Air Pacific Repair Activity, (Atsugi, Japan), FPO AP 96306
N66022 (MAJ00018)--MDW
    Naval Dental Center, San Diego, CA 92136-5147
N66074 (MAJ00062)--8AU

[[Page 655]]

    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Prairie View A&M University, Prairie View, TX 77445
N66094 (MAJ00018)--QAA-B
    Naval Hospital, Cherry Point, NC 28533-5008
N66095 (MAJ00018)--J5E
    Naval Hospital, NAS, Lemoore, CA 93246
N66096 (MAJ00018)--QAJ
    Naval Hospital Naples, Box 19 (Naples, Italy), FPO AE 90619
N66097 (MAJ00018)--MDE
    Naval Hospital, Oak Harbor, WA 98278-8800
N66101 (MAJ00018)--J5B-D
    U.S. Naval Hospital ROTA, PSC 819, Box 18, FPO AE 09645-2500
N66125 (MAJ00070)--V5J
    Naval Facility (Guam), FPO AP 96540-2903
N66231 (MAJ00072)--9TS
    Naval Reserve Readiness Center, Bldg 2711, Naval Training Center, 
Great lakes, IL 60088-5707
N66398 (MAJ00022)--ML6-7
    Navy Motion Picture Service, Flushing & Washington Avenues, 
Brooklyn, NY 11251-8400
N66458 (MAJ00065)--S0C
    Naval Oceanography Command Facility, NAS, Brunswick ME 04011-5000
N66540 (MAJ00022)--NVZ
    Morale, Welfare and Recreation Division, Bureau of Naval Personnel, 
Washington, DC 20370-5000
N66604--N4
    Naval Undersea Warfare Center, Division Newport, Newport, RI 02840
N66612 (MAJ00062)--L95
    Commanding Officer, Naval Reserve Officers Training, Corps Unit, The 
Citadel, Charleston, SC 29409-0770
N66630 (MAJ00072)--LCS
    Naval Air Reserve, Naval Air Station, Point Mugu, CA 93042-5018
N66691--4P
    Commanding Officer, Naval Support Activity, (Souda Bay, Crete, 
Greece), FPO AE 09865
N66715--VJ
    Commander, Navy Recruiting Command, Washington, DC 22203-1191
N66753 (MAJ00062)--R0G
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Jacksonville University, Jacksonville, FL 32211
N66754 (MAJ00069)--8QX
    Commanding Officer, Naval Security Group Activity, (Sabana Seca, 
PR), FPO AA 34053
N66809 (MAJ00062)--R0V
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Savannah State College, Savannah, GA 31404
N66810 (MAJ00062)--L9H
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Southern University and A&M College, Baton Rouge, LA 70813
N66833 (MAJ00060)--LHL
    Commanding Officer, U.S. Naval Station Panama (Rodman, Canal Zone), 
FPO AA 34061-1000
N66863 (MAJ00018)--MCU-X
    Commanding Officer, Naval Biodynamics Laboratory, 13800 Old Gentilly 
Road, Michout Assembly Facility, New Orleans, LA 70189
N66890--LJ
    Naval Station, Mare Island, Supply and Fiscal Code 90, Bldg 851, 
Vallejo, CA 94592
N66898 (MAJ00018)--QAF
    Commanding Officer, Naval Medical Clinic, New Orleans, LA 70142
N66957
    Defense Printing Service Det. Office, Bldg. 2049, NTC, Orlando, FL 
32813
N66959 (MAJ00023)--4JR
    Defense Printing Service Det. Office, P.O. Box 3, NAS, Jacksonville, 
FL 32212
N66965 (MAJ00023)--4JQ
    Defense Printing Service Det. Office, Point Mugu, CA 93042-5027
N66972 (MAJ00022)--MQ2
    Commanding Officer, Navy Recruiting District, 8525 N.W. 53red 
Terrace, Suite 201, Miami, FL 33166
N67596 (MAJ00022)--NVD
    Commanding Officer, Navy Recruiting District, 10500 N. U.S. Highway 
281, Suite 108, San Antonio, TX 78216-3630
N68011
    Commanding Officer, Navy Recruiting District, 8 North Third Street, 
Sterick Bldg., Memphis, TN 38103
N68047 (MAJ00070)--4L0
    Naval Regional Contracting Center, (Singapore), FPO AP 96534-2100
N68056--JE
    Naval Medical Command Southwest Region, San Diego, CA 92134
N68057--VZ
    Commanding Officer, Naval Regional Data Automation Center, Code 212, 
Norfolk, VA 23511
N68064 (MAJ00062)--R0D
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Florida, Van Fleet Hall, Room 26, Gainesville, FL 32601
N68072 (MAJ00062)--L9V
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Texas A&M University, College Station, TX 77843
N68073 (MAJ00063)--NTU
    Naval Computer and Telecommunications Station Diego Garcia, (British 
Indian Ocean Territory), FPO AP 96464-0008
N68084 (MAJ00081)--MDJ-M
    Commanding Officer (Code 206), Naval Hospital, Charleston, SC 29408-
6900
N68086--7S
    Naval Hospital, Newport, RI 02841
N68088 (MAJ00061)--NLL-N

[[Page 656]]

    National Support Unit Headquarters, Commander-in-Chief Iberian 
Atlantic Area, (Lisbon, Portugal), APO AE 09726-0001
N68090 (MAJ00018)--MD0-9
    Naval Hospital, Long Beach, CA 90822-5199.
N68092
    Naval Medical Command Northeast Region, Great Lakes, IL 60088
N68093 (MAJ00018)--MCG-H
    Naval Hospital, Camp LeJeune, NC 28542-5008
N68094--V9
    Naval Hospital, Camp Pendleton, CA 92055-5008
N68095--JF
    Naval Hospital, Boone Road, Bremerton, WA 98312-1898
N68096 (MAJ00018)--J50
    Commanding Officer, Naval Hospital (Guam), FPO AP 96540-1600
N68097
    Naval Medical Command Northwest Region, Oakland, Ca 94627
N68098 (MAJ00018)--QAL-M
    Naval Medical Clinic, Box 121 Code 01.3, Pearl Harbor, HI 96860-5080
N68101 (MAJ00018)--MDT-V
    Naval Medical Clinic 17th Street and Pattison Avenue, Philadelphia, 
PA 19145-5199
N68139 (MAJ00062)--8AZ
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Florida A&M University, Tallahassee, FL 32307
N68141 (MAJ00062)--L9P--
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Maine Maritime Academy, Castine, ME 04421-0902
N68142--NK
    Naval Computer & Telecommunications Station, Naval Air Station, 
Pensacola, FL 32508-6100
N68165 (MAJ00060)--J06-8
    Naval Facility, (Brawdy, Wales, UK), FPO AE 09420
N68166 (MAJ00015)--L01-2k
    Naval Technical Intelligence Center, 4301 Suitland Road, Washington, 
DC 20390
N68171--M3
    Commanding Officer, Naval Regional Contracting Center, (Naples, 
Italy), PSC 810, Box 50, FPO AE 09619-3700
N68175 (MAJ00022)--MQA
    Navy Recruiting District New Jersey, Parkway Towers, Building A, 485 
US Route 1, So., Iselin, NJ 08830-3012
N68199
    Commanding Officer, Navy Office of Information, Southeast, 1459 
Peachtree Street, NE--Suite 300, Atlanta, GA 30309
N68200--VM
    Dirctor, Navy Office of Information, Southwest, 1114 Commerce 
Street, Suite 811, Dallas, TX 75242
N68221--7J
    Commanding Officer, Navy Personnel Research and Development Center, 
San Diego, CA 92152
N68246 (MAJ00070)--4LL-N
    Officer in Charge, U.S. Naval Supply Depot Yokosuka Det., (Sasebo, 
Japan), FPO AP 96322-1500
N68248--V6
    Officer in Charge of Construction, Naval Facilities Engineering 
Command Contracts, Naval Submarine Base, Kings Bay, GA 31547
R68251 (MAJ00070)--LPC
    Shore Intermediate Maintenance Activity, Box 141, Pearl Harbor, HI 
96860
N68292 (MAJ00018)--J5A
    Naval Hospital (Yokosuka, Japan), FPO AP 96350-1615
N68297--ET
    Naval Magazine, Laualualie, Oahu HI 96792-4301
N68303 (MAJ00062)--R0C
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
State University of New York, Maritime College, Fort Schuyler, Bronx, NY 
10465-4198
N68306 (MAJ00072)--9TF
    Commander, Naval Reserve Readiness Command, Region Six, WNY Bldg 
200, Washington, DC 203774-2003
N68307 (MAJ00072)--LCJ
    Commander, Code 431, Naval Reserve Readiness Command Region Ten, New 
Orleans, LA 70142
N68308 (MAJ00072)--9TQ
    Naval Reserve Readiness Command, Region 20, Bldg 1, NAVSTA Treasure 
Island, San Francisco, CA 94130-5032
N68311--JL
    Naval Station, Long Beach, CA 90822
N68317 (MAJ00062)--R03
    Naval Administrative Unit, 1 Amsterdam Road, Scotia NY 12302-9460
N68322--7Z
    Naval Education & Training Program Management Support Activity, Code 
SU1, Saufley Field, Pensacola, FL 32509
N68323 (MAJ00011)--LBC
    Naval Legal Service Office, 200 Stovall Street, Alexandria, VA 
22332-2400
N68326 (MAJ00018)--MDA
    Naval Dental Center, 2707 Sheridan Road, Bldg 73, Great Lakes, IL 
60088-5258
N68327 (MAJ00022)--ML8
    Commanding Officer, Naval Reserve Personnel Center, New Orleans, LA 
70149-7800
N68328 (MAJ00072)--9TJ
    Naval Reserve Readiness Command, Region 22, Bldg 9, Naval Station, 
Seattle, WA 98115-5009
N68329 (MAJ00072)--LCL
    Naval Reserve Readiness Command, Region Five, Bldg. 1033, USAAP, 
Ravenna, OH 44266-9211
N68330 (MAJ00072)--9TN

[[Page 657]]

    Naval Reserve Readiness Command, Region 13, Bldg 1, Code 712, NTC, 
Great Lakes, IL 60088-5026
N68331 (MAJ00072)--LCE-F
    Naval Reserve Readiness Command, Region Four, Bldg. 662, Naval Base, 
Philadelphia, PA 19112
N68332 (MAJ00072)--9T0-1
    Commander, Naval Reserve Readiness Command, Region 18, 301 Navy 
Drive, Industrial Airport, KS 66031-0031
N68335-4Y
    Commanding Officer, Naval Air Warfare Center, Aircraft Division 
Lakehurst, Supply Dept., Purchase Division, Lakehurst, NJ 08733
N68348 (MAJ00072)--9TG
    Commander, Naval Reserve Readiness Command, Region Nine, NAS Memphis 
(76), Bldg E-35, Millington, TN 38054
N68349
    Commander, Naval Reserve Readiness Command, Region 16, Bldg. 715, 
Minneapolis-St. Paul IAP, Minneapolis, MN 55450-2996
N68350 (MAJ00072)--LCH
    Naval Reserve Readiness Command, Region 19, 960 North Harbor Drive, 
San Diego, CA 92132-5108
N68351 (MAJ00072)--LCQ
    Naval Reserve Readiness Command, Region One, Newport, RI 02840-5016
N68355 (MAJ00062)--R0J
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Virginia Military Institute, Lexington, VA 24450-2697
N68356 (MAJ00072)--9TD
    Commander, Naval Reserve Readiness Command, Region Seven, Naval 
Base, Charleston, SC 29408
N68357 (MAJ00072)--9TL
    Commander, Naval Reserve Readiness Command, Region Two, Scotia, NY 
12302-9465
N68358 (MAJ00072)--9TA
    Commander, Naval Reserve Readiness Command, Region Eight, Naval Air 
Station, Jacksonville, FL 32212
N68359 (MAJ00072)--9TB
    Commander, Naval Reserve Readiness Command, Region Eleven, Bldg 11, 
Naval Air Station, Dallas, TX 75211
N68378--KQ
    Navy Public Works Center, San Francisco Bay, Oakland, CA 94623
N68389 (MAJ00011)--LB4
    Commander, Joint Intelligence Center, Pacific/DSL, P.O. Box 500, 
Bldg 352, Makalapa Drive, Pearl Harbor, HI 96860-7450
N68391 (MAJ00022)--MLB
    Navy Recruiting District, Harrisburg, 310 North Second Street, 
Harrisburg, PA 17101-1304
N68401 (MAJ00022)--MLJ
    Navy Recruiting District, San Diego, Naval Training Center, Building 
335, San Diego, CA 92133-6800
N68402 (MAJ00012)--V8E
    Navy Office of Information, New England Branch, 408 Atlantic Avenue, 
Boston, MA 02210-2203
N68409 (MAJ00018)--QAU
    Naval Dental Center, San Francisco, CA 94130-5030
N68436--KC, J6
    Naval Submarine Base, Bangor, Code 863, Bremerton, WA 98315
N68441
    Commanding Officer, Naval Dental Clinic, Naval Air Station, 
Pensacola, FL 32508
N68443--7T
    Commanding Officer, Naval Dental Clinic, Bremerton, WA 98314
N68451--MF
    Navy Regional Data Automation Center San Francisco, Naval Air 
Station, Alamenda, CA 94501
N68470 (MAJ00018)--J5J-M
    Naval Hospital, (Okinawa, Japan), FPO AP 96362
N68482 (MAJ00022)
    Department of the Navy, BUPERS Det DAPMAL, Bldg 11, Naval Training 
Center, 32110 Perry Road, Suite 110, San Diego, CA 92133-1521
N68497
    Commanding Officer, Code 40, Naval Administrative Command, Naval 
Training Station, Orlando, FL 32813
N68499--LX
    Director, Naval Council of Personnel Boards, Ballston Center Tower 
#2, 801 North Randolph Street, Arlington, VA 2203-1989
N68518
    Commanding Officer, Naval Reserve Financial Information Processing 
Center, Code S43, 4400 Dauphine Street, New Orleans, LA 70146
N68520--7P
    Aviation Depot Operations Center, Naval Air Station, Patuxent River, 
MD 20670
N68527 (MAJ00072)--9TT
    Naval & MC Reserve Readiness Center, Armed Forces Reserve Center, 
Floyd Bennett Field, Brooklyn, NY 11234-7097
N68546--QG
    Navy Environmental Health Center, Naval Station, Norfolk, VA 23511
N68547 (MAJ00060)--LHQ
    Personnel Support Activity, Naval Station, Norfolk, VA 23511-5115
N68560--QM
    Naval Computer & Telecommunications Station, Jacksonville, FL 32212-
0111
N68561 (MAJ00039)--NSE
    Navy Management Systems Support Office, 1441 Crossways Blvd., 
Chesapeake, VA 23320-2843
N68573 (MAJ00023)--4JM

[[Page 658]]

    Navy Exchange Service Center, NAVABASE, Norfolk, Bldg CD-1, 9222 
Hamption Blvd, Norfolk, VA 23511-6390
N68593 (MAJ00060)--LHE
    Naval Ocean Processing Facility, Dam Neck, VA 23461-5450
N68608 (MAJ00011)--LBP-Y
    Naval Computer Telecommunications Station, 4400 Dauphine Street, New 
Orleans, LA 70145-7700
N68610--GF
    Officer in Charge, Fleet Hospital Support Office, 620 Central Ave., 
Bldg #5, Alameda, CA 94501-3874
N68636 (MAJ00024)--EHJ-K
    Naval Sea Systems Command, Automated Data Systems Activity, P.O. Box 
100, Indian Head, MD 20640-0100
N68689 (MAJ00024)--U0F
    Human Resources Office, Crystal City, Washington, DC 20376
N68691--JW
    Naval Plant Representative Office, (Melbourne, Australia), APO AP 
96551
N68692 (MAJ00062)--8AX
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of San Diego/San Diego State University, Alcala Park, San 
Diego, CA 92110-2496
N68695 (MAJ00060)--LHG
    Shore Intermediate Maintenance Activity, Naval Reserve Maintenance 
Facility, Bldg. 133, Naval Base, Philadelphia, PA 19112-5066
N68699 (MAJ00062)--8AP
    Commanding Officer, Naval Reserve Officers Training Corps Unit, Old 
Dominion University/Hampton Institute, Norfolk State University, 5215 
Hampton Blvd., Norfolk, VA 23508-8556
N68707 (MAJ00072)--9TU
    Naval Reserve Maintenance Training Facility, Puget Sound Naval 
Shipyard, Bremerton, WA 98314-5270
N68709 (MAJ00060)--J0C
    Naval Air Station, Mayport, FL 32228
N68710 (MAJ00062)--L9K
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Virginia Polytechnic Institute and State University, Blacksburg, VA 
24061-2306
N68717 (MAJ00062)--L9L
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Boston University, 116 Bay State Road, Boston, MA 02215
N68725 (MAJ00062)--R0Q
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
University of Arizona, Tucson, AZ 85721
N68726 (MAJ00062)--R0T
    Commanding Officer, Naval Reserve Officers Training Corps Unit, The 
George Washington University, Washington, DC 20052
N68727 (MAJ00062)--8AF
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Memphis State University, Memphis, TN 38152-0001
N68728 (MAJ00062)--8AQ
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Norwich University, Northfield, VT 05663-1097
N68733 (MAJ00030)--EKC
    Strategic Weapons Facility, Atlantic, Kings Bay, GA 31547-6600
N68742 (MAJ00070)--LPA
    Naval Base, Seattle, WA 98115-5012
N68753 (MAJ00070)--V5L
    Naval Air Pacific Repair Activity Det., Singapore, SAE Singapore, 
FPO AP 96536-2700
N68829 (MAJ00060)--J0J
    Shore Intermediate Maintenance Activity (NRMF), Pier 2, Bldg. 68 
NETC, Newport RI 02841-5001
N68831 (MAJ00070)--LPG
    Shore Intermediate Maintenance Activity San Francisco, Bldg. 162, 
NAS, Alameda, CA 94501-5065
N68836--J9
    Commanding Officer, Naval Supply Center, Jacksonville, FL 32212
N68857 (MAJ00062)--8AC
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Texas Tech University, Lubbock, TX 79409-4559
N68860--KR
    Naval Supply Center--Pensacola, Pensacola, FL 32508-6200
N68875 (MAJ00018)--QAP-S
    Naval Hospital (Keflavik, Iceland), PSC 1003, Box 8, FPO AE 09728-
0308
N68877 (MAJ00062)--R0Y
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Carnegie Mellon University, Pittsburgh, PA 15213
N68881 (MAJ00062)--L9E
    Commanding Officer, Naval Reserve Officers Training Corps Unit, 
Morehouse College, Atlanta, GA 30314
N68891 (MAJ00060)--LH5
    Naval Station, Ingleside, TX 78362-5000
N68899 (MAJ00072)--LCW
    Naval Reserve Intelligence Command, Bldg. 11, Naval Air Station, 
Dallas, TX 75211-9541
N68925--8J
    Navy Public Works Center, Building 175, Washington Navy Yard, 901 M 
Street, SE, Washington, DC 20374-5041
N68939 (MAJ00012)--V8R
    Naval Information Systems Management Center, Washington Navy Yard, 
Bldg 176-4, Washington, DC 20374-5070
N68944--4F, 4W, EW, 3E, KU, 3B
    Naval Command, Control and Ocean Surveillance Center, ISE West Coast 
Division (NISE West), San Diego, CA 92186-5137
N70092, (MAJ00069)--8QJ-K, Q-R

[[Page 659]]

    Naval Security Station, 3801 Nebraska Avenue, NW, Washington, DC 
20390-8230
N70240--M6
    Commanding Officer, Naval Computer and Telecommunications Station, 
Naval Air Station, 937 N. Harbor Drive, San Diego, CA 92132
N70272--8G, ND, LQ
    Naval Computer and Telecommunications Area, Master Station Atlantic, 
Norfolk, VA 23511-6898
N70273--V3
    Naval Radio Station, Jim Creek, Oso, WA 98223
N70278--V4
    Naval Computer and Telecommunications Station, (Yokosuka, Japan), 
Box 3, FPO AP 96349
N70283 (MAJ00069)--8QE
    Commanding Officer, Code 30, Naval Security Group Activity, (Galeta 
Island, Canal Zone), FPO AA 34060-9998
N70294--8H
    U.S. Naval Computer and Telecommunications Area, Master Station MED, 
(Naples, Italy), FPO AE 09620
N70310--N2
    Naval Radio Station R, Sugar Grove, WV 26815.

              PART 4--MARINE CORPS ACTIVITY ADDRESS NUMBERS

M00027--MS*, MU*, MS0-9
    Headquarters, U.S. Marine Corps, Washington, DC 20380
M00146--MT
    Marine Corps Air Station, Cherry Point, NC 28533
M00243--NE
    Marine Corps Recruit Depot, San Diego, CA 92140
M00263--MX
    Marine Corps Recruit Depot, Parris Island, SC 29905
M00264 (MAJ00027)--MUT
    Marine Corps Combat Development Command, Marine Corps Air Facility, 
Quantico, VA 22134-5001
M00318
    Marine Corps Air Station, Kaneohe Bay, Oahu, HI 96744
M00681--NG
    Marine Corps Base, Camp Pendleton, Oceanside, CA 92054
M60050--MV
    Marine Corps Air Station, El Toro, Santa Ana, CA 92709
M62204--MW
    Marine Corps Logistics Base, Barstow, CA 92311
M62974--NA
    Marine Corps Air Station, Yuma, AZ 85364
M67001--NB
    Marine Corps Base, Camp Lejeune, NC 28542
M67004--NC
    Marine Corps Logistics Base, Albany, GA 31704
M67011 (MAJ00027)--MSA
    Director, 1st Marine Corps District, Garden City, Long Island, NY 
11530
M67013 (MAJ00027)--MSC
    Director, 4th Marine Corps District, Philadelphia, PA 19112-5072
M67015 (MAJ00027)--MSE
    Director, 6th Marine Corps District, Atlanta, GA 30303
M67016 (MAJ00027)--MSG
    Director, 8th Marine Corps District, New Orleans, LA 70113
M67017 (MAJ00027)--MSJ
    Director, 9th Marine Corps District, Shawnee Mission, KA 66204
M67019 (MAJ00027)--MSL
    Director, 12th Marine Corps District, San Francisco, CA 94130
M67021 (MAJ00027)--MUC
    Marine Aircraft Wing 4, New Orleans, 4400 Dauphine Street, New 
Orleans, LA 70146-9125
M67025
    Headquarters, Fleet Marine Force, Pacific, Pearl Harbor, HI 96860
M67029 (MAJ00027)--MSN
    Marine Barracks, Washington, DC 20003
M67030 (MAJ00027)--MUP
    Marine Corps Security Force Battalion Pacific NAVSTA Mare Island 
Vallejo, CA 94592-5022
M67290 (MAJ00027)--MSY
    Marine Aviation Training Support Group-90, NATTC, NAS Memphis, 
Millington, TN 38054-5123
M67351
    Marine Corps Security Force Company (London, UK) APO AE 09499
M67353 (MAJ00027)--MSQ
    Headquarters Battalion, Marine Corps, Henderson Hall, Arlington, VA 
22214
M67354
    Post Supply Officer, Headquarters Marine Corps, Navy Annex, 
Arlington, VA 20380
M67355 (MAJ00027)--MUN
    Landing Force Training Command Atlantic Naval Surface Force, U.S. 
Atlantic Fleet, Naval Amphibious Base, Little Creek, Norfolk, VA 23521-
2350
M67385 (MAJ00027)--MU0-1
    Camp H.M. Smith, U.S. Marine Corps, Halawa Heights, Oahu, Hawaii 
96861
M67391--KY
    Marine Corps Camp Det. (Camp Elmore), Norfolk, VA 23511
M67399--NF
    Marine Corps Air-Ground Combat Center, Twentynine Palms, CA 92278
M67400--QJ
    Marine Corps Procurement Office, Okinawa, Marine Corps Base, Camp 
Smedley D. Butler (Ryuku Island, Southern), FPO AP 96373
M67428--JA

[[Page 660]]

    Marine Corps Air Bases Western Area, MCAS El Toro, Santa Ana, CA 
92709
M67443--LG
    Defense Finance and Accounting Service, Kansas City Center, Kansas 
City, MO 64197
M67840 (MAJ00027)--MUV
    USMC, Marine Corps Detachment, 1420 Hughes Avenue, Lackland Training 
Center, Lackland AF Base, TX 78236-5411
M67842--K6
    East Coast Commissary Complex, Marine Corps Base, Camp LeJeune, NC 
28542
M67853 (MAJ00027)--MUR
    Marine Corps Security Force Battalion Atlantic, Naval Base, Norfolk, 
VA 23511-5697
M67854 (MAJ00027)--MU6-9
    Marine Corps Systems Command, 2033 Barnett Ave, Suite 315, Quantico, 
VA 22134-5010
M68479 (MAJ00027)--MSU
    4th Marine Division (Rein), FMF, USMCR, 4400, Dauphine Street, New 
Orleans, LA 70146-5400
M68522 (MAJ00027)--MSW
    Marine Corps Reserve Support Center, Purchasing Department, 16950 El 
Monte, Overland Park, KS 66211-1408

               PART 5--AIR FORCE ACTIVITY ADDRESS NUMBERS

F01600
5A
    42 CONS/CC, 50 Lemay Plaza S, Bldg 804, Maxwell AFB, AL 36112-6334
F01620
6K
    SSC/PK, 375 Libby Street, MAFB-Gunter Annex, AL 36114-6343
F02601
5C
    355 CONS/CC, 3180 S. Craycroft Road, Davis-Monthan AFB, AZ 85707-
3522
F02604
5D
    56 CONS/CC, 14100 West Eagle St, Luke AFB, AZ 85309-1217
F03602
5F
    314 CONS/CC, 642 Thomas Avenue, Little Rock AFB, AR 72099-5019
F04604
5G
    93 CONS/CC, F St Bldg 708, Castle AFB, CA 95340-5320
F04605
5H
    722 CONS, 1485 Graeber St, Ste 21, March AFB, CA 92518-1729
F04606
SM
    SM-ALC/PK, Bldg 200, 3237 Peacekeeper Way, Ste 17, McClellan AFB, CA 
95652-1060
F04611
QQ
    AFFTC/PK, Bldg 2800, 5 S Wolfe Ave, Edwards AFB, CA 93524-1185
F04626
5M
    60 CONS/LGC, 350 Hangar Avenue, Bldg 549, Travis AFB, CA 94535-2632
F04666
5N
    9 CONS/CC, 6500 B St, Ste 101, Beale AFB, CA 95903-1712
F04684
QW
    30 CONS/LGC, 806 13th St, Ste D, Bldg 7015 Sect 2c, Vandenberg AFB, 
CA 93437-5226
F04689
RN
    750 LSS/LGC, 1080 Lockheed Way, Box 039, Onizuka AFB, CA 94089-1234
F04690
RF
    Det 2, SMC/PK, 1080 Lockheed Way Box 043, Onizuka AFB, CA 94089-1235
F04693
MG
    SMC/PKD, 400 N Douglas Blvd Ste 212E, Los Angeles, CA 90245-4640
F04699
Q5
    SM-ALC/PK, Bldg 200 3227 Peacekeeper Way Ste 17, McClellan AFB, CA 
95652-1060
F04700
Q2
    AFFTC/PKA, 5 S Wolfe Ave, Building 2800, Edwards AFB, CA 93524-1185
F04071
TB
    SMC/PK, 155 Discovery Blvd Ste 1516, Los Angeles, CA 90245-4692
F04704
R9
    Det 10 SMC/PK, Bldg 951, 1111 E. Mill St Rm 104, San Bernardino, CA 
92408-1621
F05603
    HQ AFSPC/LGC, 150 Vandenberg Street Ste 1105, Peterson AFB, CO 
80914-4350
F05604
SX
    21 CONS/LGC, 700 Suffolk Street, Peterson AFB, CO 80914-1200
F05611
5Q
    10 ABW/LGC, 8110 Industrial Drive Ste 200, USAF Academy, CO 80840-
2315
F07603
5R
    436 CONS/LGC, 639 Atlantic Street Ste 243, Dover AFB, DE 19902-5639
F08602
5S
    56 CONS/CC, 3014 Zemke Avenue, MacDill AFB, FL 33621-5000
F08620
5T
    16 CONS/LGC, P.O. Box 9190, 350 Tully Street, Hurlburt Field, FL 
32544-5825
F08626
QU

[[Page 661]]

    OL/PK ASC/PK, 205 West D Ave, Ste 433, Bldg 350, Eglin AFB, FL 
32542-6864
F08630
S1
    OL-MNK ASC/MNK, 101 W Eglin Blvd, Ste 337, Bldg 13, Eglin AFB, FL 
32542-6810
F08635
RH
    AFDTC/PK, Bldg 350, 205 West D Avenue Ste 433, Eglin AFB, FL 32542-
6864
F08637
5V
    325 CONS/CC, 501 Illinois Ave Ste 5, Tyndall AFB, FL 32403-5526
F08650
TJ
    45 CONS/PKESM, 1201 Minuteman Street, Patrick AFB, FL 32925-5432
F08651
Q3
    AFDTC/PKO, 205 West D Ave Ste 541, Eglin AFB, FL 32542-6862
F09603
RJ, RR
    WR-ALC/PK, Bldg 300, 215 Byron Street, Robins AFB, GA 31098-1611
F09604
RU
    Det 8, 2762 LS(SP)/PK, 750 3rd St, Bldg 350, Robins AFB, GA 31098-
2122
F09607
5W
    347 CONS/CC, 4380B Alabama Rd, Moody AFB, GA 31699-1793
F09609
5X
    94 LG/LGC, 1538 Atlanta Ave Ste 104, Dobbins AFB, GA 30069-4824
F09634
5Y
    HQ AFRES/LGC, 155 2nd St, Robins AFB, GA 31098-1638
F09650
Q6
    WR-ALC/PKO, Bldg 300, 215 Byron Street, Robins AFB, GA 31098-1803
F10603
5Z
    366 CONS/CC, 366 Gunfighter Ave Ste 498, Mountain Home AFB, ID 
83648-4037
F11603
6B
    928 AW/LGC, 6626 N. Patton Rd Ste 94, Chicago O'Hare IAP, IL 60666-
5023
F11623
6C
    375 CONS/LGC, 102 E Martin Street Ste 216, Scott AFB, IL 62225-5015
F11624
X4
    CSPO/CGZ, 3205 East Drive, Scott AFB, IL 62225-5425
F11626
    HQ AMC/DOKR, 402 Scott Dr Unit 3A1, Scott AFB, IL 62225-5302
F12617
6D
    434 LSS/LGC, 2 Kittyhawk St, Grissom ARB, IN 46971-5320
F14614
6E
    22 CONS/LGC, 53147 Kansas St Ste 102, McConnell AFB, KS 67221-3606
F16602
6G
    2 CONS/CC, 841 Fairchild Ave., Barksdale AFB, LA 71110
F19617
R5
    439 LSS/LGC, 100 Logistics Dr, 2nd Floor Ste 200, Westover ARB, MA 
01022-1531
F19628
RS
    ESC/PK, Bldg 1520, 104 Barksdale Street, Hanscom AFB, MA 01731-1806
F19650
SH
    ESC/PKO, Bldg 1520, 104 Barksdale Street, Hanscom AFB, MA 01731-2816
F20613
6L
    410 CONS/CC, 417 A Ave Ste 112, Sawyer AFB, MI 49843-3299
F21611
6N
    934 LG/LGC, 760 Military Hwy, Minneapolis, MN 55450
F22600
RC
    81 CONS/CC, 200 Fifth St Ste 101, Keesler AFB, MS 39534-2102
F22608
6Q
    14 CONS/CC, 555 Seventh Street Ste 113, Columbus AFB, MS 39701-1006
F23606
6R
    509 CONS/CC, 850 Arnold Ave Bldg 705, Whiteman AFB, MO 65305-5021
F24604
6T
    341 CONS/LGC, 7015 Goddard Dr, Malmstrom AFB, MT 59402-6863
F25600
6U
    55 CONS/CC, MBB 09 106 Peacekeeper Dr Ste 2N3, Offutt AFB, NE 68113-
5320
F26600
S4
    554 CONS/CC 5865 Swabb Blvd, Nellis AFB, NV 89191-7063
F28609
6V
    305 CONS/LGC, 3563 Lancaster Ave, McGuire AFB, NJ 08641-2712
F28620
M1
    65 CONS/CC, APO AE 09720-7775
F28620
S8
    65 CONS/O1-A, PO Box 837, Wrightstown, NJ 05862-0837
F29601
RW

[[Page 662]]

    PL/PK, Bldg 499, 3651 Lowry Ave SE Rm 222, Phillips Laboratory, 
Kirtland AFB, NM 87117-5777
F29605
6W
    27 CONS/CC, 100 North Torch Blvd, Cannon AFB, NM 88103-5320
F29650
R3
    PL/PKO, 3651 Lowry Ave SE Rm 117, Kirtland AFB, NM 87117-5777
F29651
6X
    49 CONS/CC, PO Drawer S, Holloman AFB, NM 88330-1601
F30602
RX
    RL/PK, Bldg 106, 26 Electronic Pky, Griffiss AFB, NY 13441-4514
F30617
6Y
    914 AW/LGC, 2720 Kirkbridge Drive, Niagara Falls IAP-ARS, NY 14304-
5320
F30635
S3
    416 CONS/CC, 375 Brooks Road, Griffiss AFB, NY 13440
F30636
6Z
    380 CONS/LGC, 11 Ohio Avenue, Plattsburgh AFB, NY 12903-3506
F31601
BU
    23 CONS/CC, 1443 Reilly Rd Ste C, Pope AFB, NC 28308-2896
F31610
BW
    4 CONS/CC, 1695 Wright Ave, Seymour Johnson AFB, NY 27531-2459
F32604
BX
    5 CONS/CC, 211 Missile Ave, Minot AFB, ND 58705-5027
F32605
BY
    319 CONS/CC, 575 6th Ave, Grand Forks AFB, ND 58205-6436
F33600
RZ
    ASC/PKW, 1940 Allbrook Dr Ste 3, Bldg 1, Wright Patterson AFB, OH 
45433-5309
F33601
Q7
    ASC/PKWO, 1940 Allbrook Dr Ste 3, Bldg 1, Wright Patterson AFB, OH 
45433-5309
F33615
SG
    WL/PK, Bldg 7, 2530 C Street, Wright Patterson AFB, OH 45433-7607
F33630
C1
    910 AW/LGC, 3976 King Graves Rd, Youngstown-Warren Rgl Arpt, 
Youngstown ARP, OH 44473-0910
F33657
SC
    ASD/PK, Bldg 14, 1865 Fourth St Ste 6, Wright Patterson AFB, OH 
45433-7120
F33659
Q8
    AGMC/PK, Bldg 2, 813 Irving Wick Dr West, Newark AFB, OH 43055-0027
F33660
TA
    AGMC/PKY, Bldg 2, 813 Irving Wick Drive/W, Newark AFB, OH 43057-0027
F34600
C2
    71 FTW/CVC, 246 Brown Pkwy Ste 228, Vance AFB, OK 73705-5037
F34601
SD
    OC-ALC/PK, 3001 Staff Dr Ste 1AG76A, Tinker AFB, OK 73145-3015
F34608
TF
    CSC/PK, 4009 Hilltop Rd, Ste 103, Tinker AFB, OK 73145-2713
F34612
C3
    97 CONS/CC, 205 South 6th St Bldg 318, Altus AFB, OK 73523-5147
F34650
Q9
    OC-ALC/PKO, Bldg 3 7858 Fifth St Ste 1, Tinker AFB, OK 73145-3015
F36629
C7
    911 AW/LGC, 316 Defense Ave Ste 101, Corapolis, PA, Pittsburgh IAP-
ARS PA 15108-4403
F36700
C8
    913 AW/LGC, 1051 Fairchild Street, Willow Grove ARS, PA 19090-5203
F38601
C9
    20 CONS/CC, 305 Blue Jay St, Shaw AFB, SC 29152-5320
F38604
T3
    USCENTAF, Bldg 1132, Shaw AFB, SC 29152
F38610
CR
    437 CONS/LGC, 102 Long Street, Charleston AFB, SC 29404-4829
F39601
CT
    28 CONS/CC, 2704 George Dr, Ellsworth AFB, SD 57706-5320
F40600
Q4
    AEDC/PK, Bldg 100, 100 Kindel Dr Ste 1335, Arnold AFB, TN 37389-1335
F40650
D1
    AEDC/PKP, Bldg 100, 100 Kindel Dr Ste 1332, Arnold AFB, TN 37389-
1332
F41608
SA
    SA-ALC/PK, Bldg 43, 143 Billy Mitchell Rd, Kelly AFB, TX 78241-6014

[[Page 663]]

F41612
D4
    82 CONS/CC, 136 K Avenue Ste 2, Sheppard AFB, TX 76311-2739
F41614
E2
    17 CONS/CC, 210 Scherz Boulevard, Goodfellow AFB, TX 76908-4705
F41620
E3
    64 CONS/CC, 300 Reese Blvd Ste 7, Reese AFB, TX 79489-5032
F41622
QY
    HSC/PKO, Bldg 625, 8005 9th St, Brooks AFB, TX 78235-5353
F41624
TG
    HSC/PK, Bldg 626, 8005 9th St, Brooks AFB, TX 78235-5353
F41636
ZV
    37 CONS/CC, 1655 Selfridge Avenue, Lackland AFB, TX 78236-5253
F41650
YA
    SA-ALC/PKO, Bldg 1598, 1288 Growden Rd, Kelly AFB, TX 78251-5318
F41652
E5
    7 CONS/CC, 381 3rd St, Dyess AFB, TX 79607-5320
F41685
E6
    47 CONS/CC, 171 Alabama Ave, Laughlin AFB, TX 78843-5102
F41689
SK
    AETC CONS/CC, 550 D Street Ste 07, Randolph AFB, TX 78150-4434
F41691
Y0
    12 CONS/CC, 395 B Street West Ste 02, Randolph AFB, TX 78150-4525
F42600
QP
    OO-ALC/PK, Bldg 1289, 6038 Aspen Ave, Hill AFB, UT 84056-5805
F42610
QP
    OO-ALC/LMK, Bldg 1258, 6014 Dogwood Ave, Hill AFB, UT 84056-5821
F42620
QP
    OO-ALC/LAK, Bldg 1233, 6072 Fir Avenue, Hill AFB, UT 84056-5820
F42630
QP
    OO-ALC/LIK, Bldg 1215, 6050 Gum Lane, Hill AFB, UT 84056-5825
F42650
R2
    OO-ALC/PKO, Bldg 1289 NE 6038 Aspen Ave, Hill AFB, UT 84056-5805
F44600
F3
    1 CONS/CC, 74 Nealy Ave Ste 109, Langley AFB, VA 23665-2088
F44650
Q1
    ACC CONS, 227 Harding Ave Ste 302, Langley AFB, VA 23665
F45603
F5
    62 CONS/LGC, 100 Main Street Ste 1049, McChord AFB, WA 98438-1109
F45613
F8
    92 CONS/LGC, 110 W Ent St Ste 200, Fairchild AFB, WA 99011-9403
F47606
G7
    440 AW/LGC, 300 East College Avenue, Gen. Mitchell IAP-ARS, WI 
53207-6299
F48608
G9
    90 CONS/LGC, 7505 Marne Loop, F.E. Warren AFB, WY 82005-2860
F49620
SE
    AFOSR/PK, Bldg 410, 110 Duncan Ave Ste B115, Bolling AFB, DC 20332-
0001
F49642
J1
    11 CONS/LGC, 3534 Ohio Dr, Andrews AFB, MD 20331-5152
F61101
T1
    Det 1, 21 CONS/CC, APO AE 09710-5000
F61211
N9
    31 FW/LGC, Unit 6102, Box 140, Aviano AB APO AE 09601-2140
F61354
W8
    741 ABS/LGC, Unit 6870, Box 85, Izmir AB APO AE 09821-7085
F61358
W9
    39 CONS/LGC, Unit 730, Box 285, Incirlik AB APO AE 09824-0285
F61503
UC
    435 AW/LGC, Unit 7420 Box 115, Rhein Main AB APO AE 09097-0115
F61517
UF
    52 CON FLT/LGC, Unit 3910, Bldg 2001, Spangdahlem AB APO AE 09137-
3910
F61521
UH, UJ
    USAFE CONS/LGC, Unit 3115, Ramstein AB AE 09094-3115
F61708
UK
    603 CS/CON, Unit 5500, Bldg 202, RAF Croughton APO AE 09494-5500
F61730
UQ
    OL-C 10 LG/LGC, Unit 5720, RAF Upwood APO AE 09470-5720
F61775
UV

[[Page 664]]

    48 CONS/LGC, Unit 5070, Box 270, RAF Feltwell APO AE 09461-0270
F61815
UW
    496 ABS/LGC, Unit 6585, Moron AB APO AE 09643-6585
F62032
4D
    USMTM, Unit 61300 Box 2, APO AE 05862-0837
F62321
RA
    18 CONS/LGC, Unit 5199, Kadena AB APO AP 96368-5199
F62509
QZ
    35 CONS, Unit 5201, Misawa AB APO AP 96319-5201
F62562
SW
    374 CONS/LGC, Unit 5228, Yokota AB AP 96328-5228
F64133
S9
    36 CONS/CC, Unit 14040, Anderson AFB APO AP 96543-4040
F64605
TN
    15 CONS/LGC, 90 G Street, Hickam AFB, HI 96853-5230
F65501
WF
    3 CONS/CC, 6920 12th Street Ste 242, Elmendorf AFB, AK 99506-2570
F65503
WH
    354 CONS/LGC, 3112 Broadway Avenue Ste 3, Eielson AFB, AK 99702-1850
F66501
R7
    24 CONS/CC, Unit 0550, Howard AFB APO AA 34001-0550
FA0021
    HQ AFSOC/LGCX, 100 Bartley St, Hurlburt Field, FL 32544-5273
FA2550
    50 LSS/LGC, 300 O'Malley Avenue, Suite 30, Falcom AFB, CO 80912-3030
FA4416
5J
    89 CONS/LGC, 1419 Menoher Dr, Andrews AFB, MD 20331-5000
FA4452
RL
    AMCCONF/LGCF, 102 E. Martin St., Rm 216, Scott AFB, IL 62225-5015
FA6648
5U
    482 LSSQ/LGC, 360 Coral Sea Blvd Rm 112, Homestead ARB, FL 33039-
1299
FA6652
E9
    924 FW/LGC, PO Box 1460, Del Valle, TX 78617-1460
FA6675
D5
    301 LG/LGC, 1710 Burke Ave., NAS Joint Reserve Base, Fort Worth, TX 
76127-6200

        PART 6--DEFENSE LOGISTICS AGENCY ACTIVITY ADDRESS NUMBERS

SP0100
TW
    Defense Personnel Support Center, Directorate of Clothing and 
Textiles, 2800 South 20th Street, Philadelphia, PA 19109-8419
SP0103
W7
    Defense Personnel Support Center, Installation Support, 2800 South 
20th Street, Philadelphia, PA 19109-8419
SP0200
TX
    Defense Personnel Support Center, Directorate of Medical Materiel, 
2800 South 20th Street, Philadelphia, PA 19101-8419
SP0300
UE
    Defense Personnel Support Center, Directorate of Subsistence, 2800 
South 20th Street, Philadelphia, PA 19101-8419
SP0302
W6
    Defense Subsistence Region Pacific, ATTN: DSR-Pacific, 2155 Mariner 
Square Loop, Alameda, CA 94501-1022
SP0303
U6
    Defense Subsistence Region Europe, DSR Europe, APO AE 09052
SP0400
TY
    Defense General Supply Center, Business Operations, 8000 Jefferson 
Davis Highway, Richmond, VA 23297-5770
SP0410
XH
    Defense General Supply Center, Base Spt Div, Dir of Spec Proc, 8000 
Jefferson Davis Highway, Richmond, VA 23297-5312
SP0411
TY
    Defense General Supply Center, Proc Br (ESOC), Customer Asst Ctr, 
8000 Jefferson Davis Highway, Richmond, VA 23297-5871
SP0413
TY
    Defense General Supply Center, Spec Purchase Br, Prod Ctr Spt Div, 
8000 Jefferson Davis Highway, Richmond, VA 23297-5864
SP0414
TY
    Defense General Supply Center, SASPS Phase I Br, Prod Ctr Spt Div, 
8000 Jefferson Davis Highway, Richmond, VA 23297-5863
SP0420
XK
    Defense General Supply Center, DODDS Div., Dir Of Spec Proc, 8000 
Jefferson Davis Highway, Richmond, VA 23297-5313

[[Page 665]]

SP0430
TY
    Defense General Supply Center, Proc Br, Product Center 5, 8000 
Jefferson Davis Highway, Richmond, VA 23297-5813
SP0440
TY
    Defense General Supply Center, Proc Br, Product Center 7, 8000 
Jefferson Davis Highway, Richmond, VA 23297-5834
SP0441
TY
    Defense General Supply Center, Proc Br, Product Center 6, 8000 
Jefferson Davis Highway, Richmond, VA 23297-5822
SP0450
TY
    Defense General Supply Center, Proc Br, Product Center 4, 8000 
Jefferson Davis Highway, Richmond, VA 23297-5800
SP0451
TY
    Defense General Supply Center, Proc Br, Product Center 2, 8000 
Jefferson Davis Highway, Richmond, VA 23297-5772
SP0460
TY
    Defense General Supply Center, Proc Br, Product Center 1, 8000 
Jefferson Davis Highway, Richmond, VA 23297-5772
SP0461
TY
    Defense General Supply Center, Special Purchase Branch (SPUR), 8000 
Jefferson Davis Highway, Richmond, VA 23297-5864
SP0490
TY
    Defense General Supply Center, Proc Br, Product Center 1, 8000 
Jefferson Davis Highway, Richmond, VA 23297-5846
SP0499
    Defense General Supply Center--FCIM, 8000 Jefferson Davis Highway, 
Richmond, VA 23297-5000
SP0500
TZ
    Defense Industrial Supply Center, 700 Robbins Avenue, Philadelphia, 
PA 19111-5096
SP0510
W2
    Defense Industrial Supply Center, Base Operating Support System, 700 
Robbins Avenue, Philadelphia, PA 19111-5096
SP0520
    Defense Industrial Supply Center, Product Verification Testing 
Acquisition, 700 Robbins Avenue, Philadelphia, PA 19111-5096
SP0599
    Defense Industrial Supply Center--FCIM, 700 Robbins Avenue, 
Philadelphia, PA 19111-5096
SP0600
UA
    Defense Fuel Supply Center, 8725 John J. Kingman Road, Suite 2533, 
Fort Belvoir, VA 22304-6160
SP0700
UB
    Defense Construction Supply Center, P.O. Box 3990, Columbus, OH 
43216-3990
SP0701
    Defense Construction Supply Center, Directorate of Contracting and 
Production, ATTN: DDCO TTC, Bldg 122, Columbus, OH 43216-5000
SP0710
YL
    Defense Construction Supply Center, Commercial Activities and 
Service Branch, P.O. Box 16704, Columbus, OH 43216-5010
SP0720
YM
    Defense Construction Supply Center, Wood Products Branch, P.O. Box 
16704, Columbus, OH 43216-5010
SP0730
WZ
    Defense Construction Supply Center, Military Interdepartmental PR 
MIPR Division, P.O. Box 3990, Columbus, OH 43216-5000
SP0740
XJ
    Defense Construction Supply Center, High Demand Group (MINI-ICP), 
P.O. Box 3990, Columbus, OH 43216-5000
SP0750
UB
    Defense Construction Supply Center, Contracts Division I, P.O. Box 
16704, Columbus, OH 43216-5010
SP0760
UB
    Defense Construction Supply Center, Contracts Division II, P.O. Box 
16704, Columbus, OH 43216-5010
SP0770
UB
    Defense Construction Supply Center, Contracts Division III, P.O. Box 
16704, Columbus, OH 43216-5010
SP0780
    Defense Construction Supply Center, Government Furnished Property 
Acct, P.O. Box 16704, Columbus, OH 43216-5000
SP0799
    Defense Construction Supply Center--FCIM, P.O. Box 3990, Columbus, 
OH 43216-5000
SP0833
VS
    Defense National Stockpile Center, 8725 John J. Kingman Road, Suite 
3339, Fort Belvoir, VA 22060-6223
SP0834
VT
    Defense National Stockpile Center, Zone 1--Management Office, Room 
19-116, 26 Federal Plaza, New York, NY 10278-5000
SP0835
VU

[[Page 666]]

    Defense National Stockpile Center, Zone 2--Management Office, 3200 
Sheffield Avenue, Hammond, IN 46327-5000
SP0836
VY
    Defense National Stockpile Center, Zone 3--Management Office, 819 
Taylor Street, Fort Worth, TX 76102-5000
SP0900
UD
    Defense Electronics Supply Center, 1507 Wilmington Pike, Dayton, OH 
45444-5000
SP0905
    Defense Electronics Supply Center, Passive Devices Division, 1507 
Wilmington Pike, Dayton, OH 45444-5198
SP0910
U7
    Defense Electronics Supply Center, Base Contracting Section, 1507 
Wilmington Pike, Dayton, OH 45444-5000
SP0920
W4
    Defense Electronics Supply Center, 1507 Wilmington Pike, Dayton, OH 
45444-5198
SP0930
    Defense Electronics Supply Center, Switches Division, 1507 
Wilmington Pike, Dayton, OH 45444-5198
SP0935
    Defense Electronics Supply Center, Connectors Division, 1507 
Wilmington Pike, Dayton, OH 45444-5198
SP0960
    Defense Electronics Supply Center, Active Devices Division, 1507 
Wilmington Pike, Dayton, OH 45444-5198
SP0970
    Defense Electronics Supply Center, ADP/Communications Division, 
Dayton, OH 45444-5198
SP0980
    Defense Electronics Supply Center, Tailored Logistics Acquisitions, 
1507 Wilmington Pike, Dayton, OH 45444-5198
SP0999
    Defense Electronics Supply Center--FCIM, 1507 Wilmington Pike, 
Dayton, OH 45444-5160
SP3100
WX
    Defense Distribution Region East (DDRE), Office of Contracting, New 
Cumberland, PA 17070-5001
SP3200
TV
    Defense Distribution Region West (DDRW), Office of Contracting, 
Building S-4, Lathrop, CA 95330-5000
SP3500
UN
    Defense Distribution Region East (DDRE), Office of Contracting, New 
Cumberland, PA 17070-5001
SP4400
X1
    Defense Reutilization Marketing Service, Federal Center, 74 
Washington Avenue North, Battle Creek, MI 49017-3092
SP4410
X1
    Defense Reutilization Marketing Service, Special Contracts Division, 
ATTN: DRMS-PP, Federal Center, 74 Washington Avenue North, Battle Creek, 
MI 49017-3092
SP4700
YK
    Defense Logistics Agency, ADP Telecommunications Contracting Office, 
8725 John J. Kingman Road, Suite 2533, Fort Belvoir, VA 22060-6221
SP4800
    Defense Logistics Agency, Office of Small and Disadvantaged Business 
Utilization, 8725 John J. Kingman Road, Suite 2533, Fort Belvoir, VA 
22060-6221
SBL00A
MJ
    DCMAO Brussels/Emb, PSC 82, Box 002, APO AE 09724
SCN01A
WV
    DCMAO Canada, 275 Bank Street, Suite 200, Ottawa, ON Canada K2P
SGR18A
    DCMAO Frankfurt, CMR 410, Box 761, APO AP 09096
SJP10A
Y9
    DCMAO 6TSUGI Japan, PSC 477, Box 39, APO AP 96306-2739
SKR08A
R1
    DCMAO Korea, Unit 2000, APO AE 96214-5000
SM104A
XC
    DCMAO Kuala Lumpur, American Embassy, APO AP 96535-5000
SPH07A
    DCMAOR Manila, APO CA, San Francisco, CA 96440
SPR01A
QF
    DCMAO Puerto Rico, P.O. Box DLA (NSGA), FPO AA 34053-0007
SPR02A
    DCMAOR Alverca, Alverca Portugal, APO PO 09726
SSR01A
YE
    DCMAO Israel, Unit 228, APO AE 09830-7228
STR02A
TQ
    DCMAO Ankara, Unit 9050, APO AE 09822-9050
SUK12A
VN
    DCMAO United Kingdom, Unit 4790, APO AE 09449-4790
S0102A
WA

[[Page 667]]

    DPRO Pemco Aeroplex, Inc., P.O. Box 12447, Birmingham, AL 35202-2447
S0302A
WY
    DCMAO Phoenix, The Monroe School, 215 North 7th Street, Phoenix, AZ 
85034-1012
S0304A
TR
    DPRO McDonnell Douglas Helicopter, 5000 East McDowell Road, Mesa, AZ 
85025-9797
S0305A
SR
    DPRO Hughes, Tucson, P.O. Box 1137 M/S E-4, Tucson, AZ 85734-1337
S0506A
WL
    DCMD West, 222 North Sepulveda Boulevard, El Segundo, CA 90245-4320
S0507A
XR
    DCMAO San Francisco, 1250 Bayhill Drive, San Bruno, CA 94066-3070
S0512A
YC
    DCMAO Van Nuys, 6230 Van Nuys Boulevard, Van Nuys, CA 91401-2713
S0513A
UG
    DCMAO Santa Ana, 34 Civic Center Plaza, P.O. Box C 12700, Santa Ana, 
CA 92712-2700
S0514A
VH
    DCMAO San Diego, 7675 Dagget Street, Suite 200, San Diego, CA 92111-
2241
S0520A
VR
    DPRO United Defense, California, 1125 Coleman Avenue, P.O. Box 367, 
San Jose, CA 95103-0367
S0523A
YG
    DPRO Westinghouse, 401 East Hendy Avenue, P.O. Box 3499, M/S 11-7, 
Sunnyvale, CA 94088-3499
S0530A
X9
    DPRO McDonnell Douglas, Space Systems Company, 5301 Bolsa Avenue, 
Huntington Beach, CA 92647-2048
S0533A
XG
    DPRO Hughes, Fullerton, 1901 West Malvern Street, P.O. Box 3310, 
Fullerton, CA 92634-3310
S0539A
QT
    DPRO Hughes, Los Angeles, P.O. Box 92463, Los Angeles, CA 90009-2463
S0540A
RB
    DPRO Rockwell, Anaheim, 3370 Miraloma Avenue, M/S AB02A, Anaheim, CA 
92803-3110
S0542A
RY
    DPRO Rockwell, Canoga Park, 6633 Canoga Avenue, Canoga Park, CA 
91303-2790
S0543A
QX
    DPRO Lockheed, Sunnyvale, P.O. Box 3504, Sunnyvale, CA 94088-3504
S0544A
TC
    DPRO Douglas, Long Beach, 3855 Lakewood Boulevard, Long Beach, CA 
90846-0001
S0545A
S6
    DPRO TRW, Redondo Beach, One Space Park, Redondo Beach, CA 90278-
1078
S0546A
QR
    DPRO Northrop, Hawthorne, One Northrop Avenue, Hawthorne, CA 90250-
3296
S0602A
VK
    DCMAO Denver, Orchard Place 2, Suite 200, 5975 Greenwood Plaza 
Boulevard, Englewood, CO 80111-4715
S0605A
RE
    DPRO Martin Marietta, Denver, P.O. Box 179, Denver, CO 80201-0179
S0701A
WB
    DCMAO Hartford, 130 Darlin Street, East Hartford, CT 06108-3234
S0702A
UP
    DCMAO Stratford, 555 Main Street, Stratford, CT 06497-7593
S0703A
XT
    DPRO Hamilton Standard, 1 Hamilton Road, Windsor Locks, CT 06096-
0463
S0707A
LF
    DPRO UTC Sikorsky Aircraft Division, Stratford, CT 06497-7553
S0708A
T5
    DPRO Pratt & Whitney, East Hartford, 400 Main Street, East Hartford, 
CT 06108-0969
S1002A
WW
    DCMAO Orlando, 3555 Maguire Boulevard, Orlando, FL 32803-3726
S1005A
XL
    DPRO Martin Marietta, Orlando, 5600 Sand Lake Road, MP49, Orlando, 
FL 32819-8907
S1009A
V1
    DPRO Harris, Melbourne, 1425 Troutman Boulevard, NE, Palm Bay, FL 
32905-4102
S1011A
T2
    DPRO Pratt & Whitney, West Palm Beach, P.O. Box 109600, West Palm 
Beach, FL 33410-9600
S1102A
UL

[[Page 668]]

    DCMD South, 805 Walker Street, Marietta, GA 30060-2789
S1103A
Y1
    DCMAO Atlanta, 805 Walker Street, Marietta, GA 30060-2789
S1109A
Z4
    DCMAO Clearwater, 1100 Cleveland Street, Suite 200, Clearwater, FL 
34615-4822
S1110A
Z5
    DPRO Grumman, St. Augustine, 5000 US Highway 1, North, P.O. Drawer 
3447, St. Augustine, FL 32085-3447
S1111A
RK
    DPRO Lockheed Aeronautical Systems Co.--Georgia, 86 South Cobb 
Drive, Bldg B-2, Marietta, GA 30063-0260
S1201A
Z9
    DCMAO Residency, Honolulu, Box 64110, Camp HM Smith, Honolulu, HI 
96861-4110
S1211A
U8
    DCMC Aircraft Program Management Office, 805 Walker Street, 
Marietta, GA 30060-2789
S1221A
X5
    DPRO Grumman, P.O. Box 9650, Melbourne, FL 32902-9650
S1403A
YP
    DCMAO Chicago, O'Hare International Airport, P.O. Box 66911, 
Chicago, IL 60666-0911
S1501A
WG
    DCMAO Indianapolis, Building 1, Fort Benjamin Harris, IN 46249-5701
S1505A
X2
    DPRO Magnavox, 1616 Directors Row, Fort Wayne, IN 46808-1286
S1701A
YD
    DCMAO Wichita, U.S. Courthouse, Suite B-34, 401 North Market, 
Wichita, KS 67202-2095
S1702A
RP
    DPRO Boeing Military Airplanes, P.O. Box 7723, Wichita, KS 67277-
7723
S1903A
    DPRO Michoud, 13800 Old Gentilly Hwy, Building 350, P.O. Box 29503, 
New Orleans, LA 70189-0503
S2102A
7H
    Defense Contract Management Residency, 895 Oceanic Drive, P.O. Box 
1488, Annapolis, MD 21401-1488
S2103A
S2
    DPRO Westinghouse Electric--Baltimore, P.O. Box 1693, M/S 1265, 
Baltimore, MD 21203-1693
S2202A
UT
    DCMD Northeast, 495 Summer Street, Boston, MA 02210-2184
S2203A
XX
    DPRO GTE Government Systems Corp, 200 First Avenue, Needham, MA 
02194-9123
S2205A
XF
    DPRO Raytheon, Spencer Laboratory, Wayside Avenue, Burlington, MA 
01803-0901
S2206A
Y3
    DCMAO Boston, 495 Summer Street Boston, MA 02210-2138
S2207A
7Q
    DPRO GE Aircraft Engines, Lynn, 1000 Western Avenue, Lynn, MA 01910-
0445
S2208A
NJ
    DPRO Martin Marietta Defense Systems, 100 Plastics Avenue, 
Pittsfield, MA 01201-3696
S2209A
SQ
    DPRO Textron Defense Systems, 201 Lowell Street, Wilmington, MA 
01887-2941
S2303A
VW
    DCMAO Grand Rapids, Riverview Center Building, 678 Front Street, NW, 
Grand Rapids, MI 49504-5352
S2305A
Y7
    DCMAO Detroit, McNamara Federal Building, 477 Michigan Avenue, 
Detroit, MI 48226-2579
S2401A
WQ
    DCMAO Twin Cities, 2305 Ford Parkway, St. Paul, MN 55116-1893
S2402A
WD
    DPRO Honeywell/Alliant Techsystems, Honeywell Plaza, 2701 4th 
Avenue, South Minneapolis, MN 54408-1792
S2404A
UR
    DCMAO Baltimore, 200 Towsontown Boulevard, West, Towson, MD 21204-
5299
S2603A
XS
    DCMAO St Louis, 1222 Spruce Street, St. Louis, MO 63103-2811
S2606A
JZ
    DPRO McDonnell Douglas, St. Louis, P.O. Box 516, St. Louis, MO 
63166-0516
S3001A
YS

[[Page 669]]

    DPRO Lockheed Sanders, Inc., Daniel Webster Highway, South, P.O. Box 
868, Nashua, NH 03061-0868
S3101A
WT
    DCMAO Springfield, 955 South Springfield Avenue, Springfield, NJ 
07081-3170
S3102A
UU
    DPRO Allied Signal, Route 46, Teterboro, NJ 07608-1173
S3109A
WC
    DPRO GEC/Kearfott, 164 Totowa Road, MS 11A30, Wayne, NJ 07474-0975
S3110A
X7
    DPRO GE Aerospace, Marne Highway and Borton Landing Road, 
Moorestown, NJ 08057-3095
S3304A
XQ
    DPRO Link Flight Simulation, Kirkwood Plant, P.O. Box 1237, 
Binghamton, NY 13902-1237
S3306A
XU
    DCMAO Syracuse, 615 Erie Boulevard West, Syracuse, NY 13204-2408
S3309A
VX
    DCMAO Garden City, 605 Stewart Avenue, Garden City, NY 11530-4761
S3314A
YN
    DPRO Harris, 6801 Jericho Turnpike, Syosset, NY 11791-4465
S3315A
YR
    DPRO IBM, Route 17C, Owego, NY 13827-1298
S3316A
KK
DPRO Grumman Aerospace, Bethpage,
    Bethpage, NY 11714-3593
S3317A
NH
    DPRO Unisys, Great Neck, Long Island, Great Neck, NY 11020-7001
S3602A
SB
    DPRO GE Aircraft Engines, Evendale, Mail Drop N-1, Cincinnati, OH 
45215-6303
S3603A
VB
    DCMAO Cleveland, A J Celebrezze Federal Building, 1240 East Ninth 
Street, Cleveland, OH 44199-2063
S3605A
VL
    DCMAO Dayton, Gentile Station, 1001 Hamilton Street, Dayton, OH 
45444-5300
S3613A
YB
    DPRO Westinghouse, Cleveland, 18901 Euclid Avenue, Cleveland, OH 
44117-1388
S3615A
YH
    DPRO Williams International, c/o Williams International Corporation, 
2280 West Maple Road, Walled Lake, MI 48088-0200
S3616A
X6
    DPRO Loral, 1210 Massillon Road, Akron, OH 44315-0001
S3618A
YF
    DPRO General Dynamics, Lima, 1155 Buckeye Road, Lima, OH 45804-1898
S3620A
VA
    Defense Contract Management Command, International Contracts 
Division, 2000 Hamilton Street, Dayton, OH 45444-5410
S3910A
XA
    DCMD Mid-Atlantic, P.O. Box 7478, Philadelphia, PA 19101-7478
S3911A
XD
    DCMAO Pittsburgh, 1612 Federal Building, 1000 Liberty Avenue, 
Pittsburgh, PA 15222-4190
S3912A
XM
    DCMAO Reading, 45 South Front Street, Reading, PA 19602-1094
S3915A
X3
    DCMAO Philadelphia, P.O. Box 7699, Philadelphia, PA 19101-7699
S3916A
TU
    DPRO Boeing Helicopters, P.O. Box 16859, Philadelphia, PA 19142-0859
S4201A
XY
    DPRO United Defense L.P., P.O. Box 15512, York, PA 17405-1512
S4402A
Z7
    DCMAO Dallas, 1200 Main Street, Dallas, TX 75202-4399
S4404A
XN
    DCMAO San Antonio, 615 East Houston, P.O. Box 1040, San Antonio, TX 
78294-1040
S4407A
WN
    DPRO E-Systems, Inc., P.O. Box 6379, Greenville, TX 75403-6379
S4408A
XZ
    DPRO Texas Instruments, Inc., P.O. Box 660246, MS 256, Dallas, TX 
75266-0246
S4418A
W1
    DPRO Bell Helicopter Textron, P.O. Box 1605, Fort Worth, TX 76101-
1605
S4419A
SL
TH

[[Page 670]]

    DPRO Lockheed, Fort Worth, P.O. Box 371, Fort Worth, TX 76101-0371
S4420A
WP
    DPRO Loral/Vought Systems, P.O. Box 655907, M/S 4915, Dallas, TX 
75265-5907
S4503A
R6
    DPRO Thiokol, P.O. Box 524, Mail Stop Z-10, Brigham City, UT 84302-
0524
S4801A
XW
    DCMAO Seattle, Building 5D, Naval Station Puget Sound, Seattle, WA 
98115-5010
S4804A
SP
    DPRO Boeing, Seattle, P.O. Box 3707, Seattle, WA 98124-2207
S4807A
WM
    DPRO, Stewart and Stevenson, Inc., 5000 Interstate 10 West, P.O. Box 
457, Sealy, TX 77474-0457
S4804A
SP
    DPRO Boeing, Seattle, P.O. Box 3707, Seattle, WA 98124-2207
S4807A
WM
    DPRO, Stewart and Stevenson, Inc., 5000 Interstate 10 West, P.O. Box 
457, Sealy, TX 77474-0457

   PART 7--DEFENSE INFORMATION SYSTEMS AGENCY ACTIVITY ADDRESS NUMBERS

DCA100, VC  DITCO-NCR, Attn: DTN, 701 South Courthouse Road, Arlington, 
VA 22204-2109 (ZD10)
DCA200, VP  Defense Information Technology Contracting Organization, 
Contracting Directorate, Attn: DTS, 2300 East Drive, Scott AFB, IL 
62225-5406 (ZD11)
DCA300, 1F  DITCO-Pacific, Attn: DTP, Building 487, Box 300, Vincennes 
Avenue and North Road, Pearl Harbor, HI 96860-5300 (ZD13)
DCA400, WK  DITCO-Europe, Attn: DTE, Unit 4235, Box 375, APO AE 09136-
5375 (ZD14)
DCA500, KH  DITCO-Alaska, Attn: DTA, 9864 L Street, Suite 201, Elmendorf 
AFB, AK 99506-2615 (ZD15)

  PART 8--NATIONAL IMAGERY AND MAPPING AGENCY ACTIVITY ADDRESS NUMBERS

NMA100, BQ  National Imagery and Mapping Agency, Contracts in Support of 
Systems and Technology, Attn: PCS/D-88, 4600 Sangamore Road, Bethesda, 
MD 20816-5003 (ZM10)
NMA201, Y2  National Imagery and Mapping Agency, Micro Purchasing 
Operations (East), Attn: PCM-E/D-6, 4600 Sangamore Road, Bethesda, MD 
20816-5003 (ZM21)
NMA202, Z2  National Imagery and Mapping Agency, Micro Purchasing 
Operations (West), Attn: PCM-W/L-13, 3200 South Second Street, St. 
Louis, MO 63118-3399 (ZM22)
NMA301, V2  National Imagery and Mapping Agency, Contracts in Support of 
Operations (East), Attn: PCO-E/D-5, 4600 Sangamore Road, Bethesda, MD 
20816-5003 (ZM31)
NMA302, YQ  National Imagery and Mapping Agency, Contracts in Support of 
Operations (West), Attn: PCO-W/L-13, 3200 South Second Street, St. 
Louis, MO 63118-3399 (ZM32)
NMA401, 8Y  National Imagery and Mapping Agency, Contracts in Support of 
Corp Affairs (East), Attn: PCC-E/D-6, 4600 Sangamore Road, Bethesda, MD 
20816-5003 (ZM41)
NMA402, YZ  National Imagery and Mapping Agency, Contracts in Support of 
Corp Affairs (West), Attn: PCC-W/L-13, 3200 South Second Street, St. 
Louis, MO 63118-3399 (ZM42)

     PART 9--DEFENSE SPECIAL WEAPONS AGENCY ACTIVITY ADDRESS NUMBERS

DSWA01, 8Z  Defense Special Weapons Agency, Headquarters, Attn: 
Acquisition Management Directorate, 6801 Telegraph Road, Alexandria, VA 
22310-3398 (ZS01)
DSWA02, 0N  Defense Special Weapons Agency, Field Command, Attn: 
Acquisition Management Office (FCA), 1680 Texas Street, S.E., Kirtland 
AFB, NM 87115-5669 (ZS02)

   PART 10--MISCELLANEOUS DEFENSE ACTIVITIES ACTIVITY ADDRESS NUMBERS

MDA112, E0  T-ASA, Sacramento Contracting Office, 3116 Peacekeeper Way, 
McClellan AFB, CA 95652-1068 (ZP12)
MDA113, VE  T-ASA, March Contracting Office, 1363 Z Street, Building 
2730, March AFB, GA 92518-2717 (ZP13)
MDA114, VV  T-ASA, Alexandria Contracting Office, 601 North Fairfax 
Drive, Suite 311, Alexandria, VA 22314-2007 (ZP14)
MDA210, SF  Defense Finance and Accounting Service Headquarters, 1931 
Jefferson Davis Highway, Arlington, VA 22240-5291 (ZF21)
MDA220  Defense Finance and Accounting Service, Integrated Contracting 
Office, 1931 Jefferson Davis Highway, Arlington, VA 22240-5291 (ZF22)
MDA230, SU  Defense Finance and Accounting Service, Cleveland Center, 
1240 East 9th Street, Cleveland, OH 44199-2055 (ZF23)
MDA240  Defense Finance and Accounting Service, Columbus Center, 4280 
East 5th Avenue, Columbus, OH 43219-1879 (ZF24)
MDA250, SV   Defense Finance and Accounting Service, Denver Center, 6760 
East

[[Page 671]]

Irvington Place, Denver, CO 80279-8000 (ZF25)
MDA260, ST   Defense Finance and Accounting Service, Indianapolis 
Center, 8899 East 56th Street, Building #1, Indianapolis, IN 46249-0100 
(ZF26)
MDA270    Defense Finance and Accounting Service, Financial Systems 
Organization, 8899 East 56th Street, Indianapolis, IN 46249-0100 (ZF27)
MDA280 SY   Defense Finance and Accounting Service, Kansas City Center, 
1500 East 95th Street, Kansas City, MO 64131 (ZF28)
MDA410, DR   DoDDS, Attn: Procurement Division, 4040 North Fairfax 
Drive, 8th Floor, Arlington, VA 22203-1635 (ZK10)
MDA412 9Y   DoDDs, European Procurement Office, Unit 29649, Box 4000, 
APO, AE 09096 (ZK12)
MDA414, Y4   DoD Education Activity, Education Supplies Procurement 
Office, Attn: DESPO, 8000 Jefferson Davis Highway, Richmond, VA 23297-
5320 (ZK14)
MDA416, YT   DoD Education Activity, Pacific Procurement Office, PSC 
556, Box 796, FPO, AP 96386-0796 (ZK16)
MDA904   Maryland Procurement Office, Attn: N363, 9800 Savage Road, Fort 
George G. Meade, MD 20755-6000 (ZD04)
MDA905 B4   Uniformed Services University of the Health Sciences, Attn: 
Directorate of Contracting, 4301 Jones Bridge Road, Bethesda, MD 20814-
4799 (ZD05)
MDA906   Office of the Civilian Health and Medical Program of the 
Uniformed Services (CHAMPUS), Attn: Contract Management Division, 
Building 222, East Harlow Avenue, FAMC, Aurora, CO 80045-6900 (ZD06)
MDA907   Purchasing and Contracting Office, Menwith Hill Station, APO AE 
09210 (ZD07)
MDA908, 2X   Virginia Contracting Activity, Attn: DAP P.O. Box 46563, 
Washington, DC 20050-6563 (ZD50)
MDA928    Armed Forces Radiobiology Research Institute, Attn: 
Acquisition Management Division, 8901 Wisconsin Avenue, Bethesda MD 
20889-5145 (ZD28)
MDA946    Washington Headquarters Services, Real Estate and Facilities 
Directorate, 1155 Defense Pentagon, Room 3C345, Washington, DC 20301-
1155 (ZD46)
MDA972 WS   DARPA, Contract Management Office, 3701 North Fairfax Drive, 
Arlington, VA 22203 (ZD72)

       PART 11--ON-SITE INSPECTION AGENCY ACTIVITY ADDRESS NUMBER

OSIA01  On-Site Inspection Agency, Acquisition Management, 201 W Service 
Road, Dulles Int Airport, PO Box 17498, Washington, DC 20041-0498 (ZD74)

 PART 12--BALLISTIC MISSILE DEFENSE ORGANIZATION ACTIVITY ADDRESS NUMBER

HQ0006, SS  Ballistic Missile Defense Organization, Attn: BMDO/DCTP, 
7100 Defense Pentagon, Room 1E1019, Washington, DC 20301-7100 (ZD60)

       PART 13--DEFENSE COMMISSARY AGENCY ACTIVITY ADDRESS NUMBERS

DECA01, ZG  Defense Commissary Agency, East Service Center, Attn: DeCA/
ES-AM, Building P-11200, 38th Street and E Avenue, Fort Lee, VA 23801-
6390 (ZD81)
DECA02, ZT  Defense Commissary Agency, West Service Center, Attn: DeCA/
WS-AM, Building 3184, Kelly AFB, TX 78241-6290 (ZD82)
DECA03, 0H  Defense Commissary Agency, North East Region, Attn: DeCA/NE-
AM, Building 2257, Fort George G. Meade, MD 20755-5520 (ZD83)
DECA04, BE  Defense Commissary Agency, Central Region, Attn: DeCA/CE-AM, 
1140 Gator Boulevard, Norfolk, VA 23521-2228 (ZD84)
DECA05, 0L  Defense Commissary Agency, Southern Region, Attn: DeCA/SO-
AM, Building 835, Maxwell AFB, AL 36112-6722 (ZD85)
DECA06, 0J  Defense Commissary Agency, Midwest Region, Attn: DeCA/MW-AM, 
Building 3030, Kelly AFB, TX 78241-6290 (ZD86)
DECA07, 0Z  Defense Commissary Agency, South West Region, Attn: DeCA/SW-
AM, Building 329, Marine Corps Air Station El Toro, Santa Ana, CA 92709-
5002 (ZD87)
DECA08, 0K  Defense Commissary Agency, Northwest Region, Attn: DeCA/NW-
AM, Building 9630, Fort Lewis, WA 98433-7300 (ZD88)

   PART 14--UNITED STATES SPECIAL OPERATIONS COMMAND ACTIVITY ADDRESS 
                                 NUMBERS

USZA22, 2U  USSOCOM Headquarters, Directorate of Procurement, 7701 Tampa 
Point Boulevard, MacDill AFB, FL 33621-5323 (ZA22)
USZA24  USSCOCOM, 24th STS, Attn: MS-Z, Pope AFB, NC 28308-5000 (ZA24)
USZA90  USSOCOM, JSOC, P.O. Box 70329, Fort Bragg, NC 28307-5000 (ZA90)
USZA91  USSOCOM, SOTF, Attn: Contracting, P.O. Box 70660, Fort Bragg, NC 
28307-5000 (ZA91)
USZA92, 1F  USSOCOM, USASOC, Attn: AOCO, Fort Bragg, NC 28307-5200 
(ZA92)
USZA93  Special Boat Squadron One (SBR-1), 3400 Tarawa Road, San Diego, 
CA 92155-5176 (ZA93)
USZA94  Naval Special Warfare Group One (NSWG-1), 3632 Guadalcanal Road, 
San Diego, CA 92155-5583 (ZA94)

[[Page 672]]

USZA95, 1A  USSOCOM, TAKO, Contracting Division, Attn: AMSAT-D-TK, 4300 
Goodfellow Boulevard, St. Louis, MO 63120 (AZ95)
USZA96, 1P  Special Boat Squadron Two (SBR-2), NAB Little Creek, 2220 
Schofield Road, Suite 100, Norfolk, VA 23521-2845 (ZA96)
USZA97  Naval Special Warfare Group Two (NSWG-2), 1430 Helicopter Road, 
Suite 200, Norfolk, VA 23521-2944 (ZA97)
USZA98  Naval Special Warfare Center, 2446 Trident Way, San Diego, CA 
92155-5494 (ZA98)
USZA99  Naval Special Warfare Development Group (ZA99), 1636 Regulus 
Avenue, Virginia Beach, VA 23461-2299
[59 FR 27678, May 27, 1994, as amended at 60 FR 61615, 61620, 61623, 
61626-61627, Nov. 30, 1995; 61 FR 7751, Feb. 29, 1996; 61 FR 18195, Apr. 
24, 1996; 61 FR 50457, 50458, Sept. 26, 1996; 62 FR 34136, June 24, 
1997]

             Appendix H--Debarment and Suspension Procedures

Sec.
H-100  Scope.
H-101  Notification.
H-102  Nature of proceeding.
H-103  Presentation of matters in opposition.
H-104  Fact-finding.
H-105  Timing requirements.
H-106  Subsequent to fact-finding.

    Authority; 41 U.S.C. 421 and 48 CFR chapter 1.
H-100  Scope.
    This appendix provides uniform debarment and suspension procedures 
to be followed by all debarring and suspending officials.
H-101  Notification.
    Contractors will be notified of the proposed debarment or suspension 
in accordance with FAR 9.406-3 or 9.407-3. A copy of the record which 
formed the basis for the decision by the debarring and suspending 
official will be made available to the contractor. If there is a reason 
to withhold from the contractor any portion of the record, the 
contractor will be informed of what is withheld and the reasons for such 
withholding.
H-102  Nature of proceeding.
    There are two distinct proceedings which may be involved in the 
suspension or debarment process. The first is the presentation of 
matters in opposition to the suspension or proposed debarment by the 
contractor.
    The second is fact-finding which occurs only in cases in which the 
contractor's presentation of matters in opposition raises a genuine 
dispute over one or more material facts. In a suspension action based 
upon an indictment or in a proposed debarment action based upon a 
conviction or civil judgment, there will be no fact-filling proceeding 
concerning the matters alleged in the indictment, or the facts 
underlying the convictions or civil judgment. However, to the extent 
that the proposed action stems from the contractor's affiliation with an 
individual or firm indicted or convicted, or the subject of a civil 
judgment, fact-finding is permitted if a genuine dispute of fact is 
raised as to the question of affiliation as defined in FAR 9.403.
H-103  Presentation of matters in opposition.
    (a) In accordance with FAR 9.406-3(c) and 9.407-3(c), matters in 
opposition may be presented in person, in writing, or through a 
representative. Matters in opposition may be presented through any 
combination of the foregoing methods, but if a contractor desires to 
present matters in person or through a representative, any written 
material should be delivered at least 5 working days in advance of the 
presentation. Usually, all matters in opposition are presented in a 
single proceeding. A contractor who becomes aware of a pending 
indictment or allegations of wrongdoing that the contractor believes may 
lead to suspension or debarment action may contact the debarring and 
suspending official or designee to provide information as to the 
contractor's present responsibility.
    (b) An in-person presentation is an informal meeting, nonadversarial 
in nature. The debarring and suspending official and/or other agency 
representatives may ask questions of the contractor or its 
representative making the presentation. The contractor may select the 
individuals who will attend the meeting on the contractor's behalf; 
individual respondents or principals of a business firm respondent may 
attend and speak for themselves.
    (c) In accordance with FAR 9.406-3(c) and 9.407-3(c), the contractor 
may submit matters in opposition within 30 days from receipt of the 
notice of suspension or proposed debarment.
    (d) The opportunity to present matters in opposition to debarment 
includes the opportunity to present matters concerning the duration of 
the debarment.
H-104  Fact-finding.
    (a) The debarring and suspending official will determine whether the 
contractor's presentation has raised a genuine dispute of material 
fact(s). If the debarring and suspending official has decided against 
debarment or continued suspension, or the provisions of FAR 9.4 preclude 
fact-finding, no fact-finding will be conducted. If the debarring and 
suspending official has determined a genuine dispute of material fact(s) 
exists, a designated fact-finder will conduct the fact-

[[Page 673]]

finding proceeding. The proceeding before the fact-finder will be 
limited to a finding of the facts in dispute as determined by the 
debarring and suspending official.
    (b) The designated fact-finder will establish the date for a fact-
finding proceeding, normally to be held within 45 working days of the 
contractor's presentation of matters in opposition. An official record 
will be made of the fact-finding proceeding.
    (c) The Government's representative and the contractor will have an 
opportunity to present evidence relevant to the facts at issues. The 
contractor may appear in person or through a representative in the fact-
finding proceeding.
    (d) Neither the Federal Rules of Evidence nor the Federal Rules of 
Civil Procedure govern fact-finding. Hearsay evidence may be presented 
and will be given appropriate weight by the fact-finder.
    (e) Witnesses may testify in person. Witnesses will be reminded of 
the official nature of the proceeding and that any false testimony given 
is subject to criminal prosecution. Witnesses are subject to cross-
examination.
H-105  Timing requirements.
    All timing requirements set forth in these procedures may be 
extended by the debarring and suspending official for good cause.
H-106  Subsequent to fact-finding.
    (a) Written findings of fact will be prepared by the fact-finder as 
mandated by FAR 9.406-3(d)(2)(i) and 9.407-3(d)(2)(i).
    (b) The fact-finder will determine the disputed fact(s) by a 
preponderance of the evidence. A copy of the findings of fact will be 
provided to the debarring and suspending official, the Government's 
representative, and the contractor.
    (c) The debarring and suspending official will determine whether to 
continue the suspension or to debar the contractor based upon the entire 
administrative record, including the findings of fact.
    (d) Prompt written notice of the debarring and suspending official's 
decision will be sent to the contractor and any affiliates involved, in 
compliance with FAR 9.406-3(e) and 9.407-3(d)(4).
[59 FR 27700, May 27, 1994]

   Appendix I--Policy and Procedures for the DOD Pilot Mentor-Protege 
                                 Program

Sec.
I-100  Purpose.
I-101  Definitions.
    I-101.1  Emerging SDB concern.
    I-101.2  Historically black college or university.
    I-101.3  Minority institution of higher education.
I-102  General procedures.
I-103  Program duration.
I-104  Eligibility requirements for a protege firm.
I-105  Selection of protege firms.
I-106  Approval process for companies to participate in the Program as 
          mentor firms.
I-107  Mentor-protege agreements.
I-108  Reimbursement procedures.
I-109  Credit for unreimbursed developmental assistance costs.
I-110  Advance agreements on the treatment of developmental assistance 
          costs.
I-111  Reporting requirements and program reviews.

    Authority; 41 U.S.C. 421 and 48 CFR chapter 1.
I-100  Purpose.
    (a) Appendix I to 48 CFR chapter 2 implements the Pilot Mentor-
Protege Program (hereinafter referred to as the ``Program'') established 
under section 831 of Pub. L. 101-510, The National Defense Authorization 
Act for Fiscal Year 1991, as amended. The purpose of the Program is to--
    (1) Provide incentives to major DoD contractors, performing under at 
least one active approved subcontracting plan negotiated with DoD or 
other Federal agencies, to assist small disadvantaged businesses (SDBs) 
in enhancing their capabilities to satisfy DoD and other contract and 
subcontract requirements;
    (2) Increase the overall participation of SDBs as subcontractors and 
suppliers and DoD contracts, other Federal agency contracts and 
commercial contracts and;
    (3) Foster the establishment of long term business relationships 
between SDBs and such contractors.
    (b) Under the Program, eligible companies approved as mentor firms 
will enter into mentor-protege agreements with eligible SDBs as protege 
firms to provide appropriate developmental assistance to enhance the 
capabilities of SDBs to perform as subcontractors and suppliers. 
According to the law, the DoD may provide the mentor firm with either 
cost reimbursement, credit against SDB subcontracting goals established 
under contracts with DoD or other Federal agencies, or a combination of 
credit and reimbursement.
    (c) DoD will measure the overall success of the Program by the 
extent to which the Program results in--
    (1) An increase in the dollar value of subcontracts awarded to SDBs 
by mentor firms under DoD contracts;
    (2) An increase in the dollar value of contract and subcontract 
awards to protege firms (under DoD contracts, contracts awarded by other 
Federal agencies and under

[[Page 674]]

commercial contracts) since the date of their entry into the Program;
    (3) An increase in the number and dollar value of subcontracts 
awarded to a protege firm (or former protege firm) by its mentor firm 
(or former mentor firm);
    (4) An improvement in the participation of SDBs in DoD, other 
Federal agencies, and commercial contracting opportunities that can be 
attributed to the development of SDBs as protege firms under the 
Program;
    (5) An increase in subcontracting with SDB concerns in industry 
categories where SDBs have not traditionally participated within the 
mentor firm's vendor base;
    (6) The involvement of emerging SDBs in the Program;
    (7) An expanded relationship between mentor firms and protege firms 
to include non-DoD programs; and
    (8) The development of protege firms that are competitive as 
subcontractors and suppliers to DoD or in other Federal agencies or 
commercial markets.
    (d) This policy sets forth the procedures for participation in the 
Program applicable to companies that are interested in receiving--
    (1) A separate contract, cooperative agreement, or other agreement 
entered into between DoD and the mentor firm--company is interested in 
reimbursement through a separate contract, cooperative agreement or 
other agreement with DoD or, a combination of reimbursement through such 
agreement with DoD and credit against SDB subcontract goals for any 
unreimbursed costs incurred under the Program.
    (2) Program Manager funded reimbursement--company has identified a 
DoD program manager willing to fund the Program and the company is 
interested in reimbursement for technical assistance costs to a protege 
firm(s) through a separately priced cost reimbursement contract line 
item added to a DoD contract, with credit against SDB subcontracting 
goals for any unreimbursed costs.
    (3) Indirect reimbursement and credit--company is interested in 
receiving reimbursement for indirect costs incurred under the Program as 
well as credit against SDB subcontract goals for these indirect costs.
    (4) Credit only--company is interested in receiving credit only 
against SDB subcontracting goals for costs incurred under the Program.
I-101  Definitions.
I-101.1  Emerging SDB concern.
    A small disadvantaged business whose size is no greater than 50 
percent of the numerical size standard applicable to the standard 
industrial code for the supplies or services which the protege firm 
provides or would provide to the mentor firm.
I-101.2  Historically black college or university.
    An institution determined by the Secretary of Education to meet the 
requirements of 34 CFR 608.2. The term also means any nonprofit research 
institution that was an integral part of such a college or university 
before November 14, 1986.
I-101.3  Minority institution of higher education.
    An institution meeting the requirements of Section 1046(3) of the 
Higher Education Act of 1965 (20 U.S.C. 1135d-5(3). The term also 
includes Hispanic-serving institutions as defined in Section 316(b)(1) 
of such Act (20 U.S.C. 1059c(b)(1)).
I-102  General Procedures.
    (a) At any time between October 1, 1991, and September 30, 1998, 
companies interested in becoming mentor firms that want to take credit 
only for costs incurred for providing developmental assistance to one or 
more protege firms, or receive credit and reimbursement of indirect 
costs incurred under the Program, must apply to the DoD for 
participation in the Program pursuant to the application process set 
forth at I-106(a).
    (b) At any time between October 1, 1991, and September 30, 1998, 
companies interested in becoming mentor firms that are able to identify 
funding from a DoD contract program manager(s) to provide developmental 
assistance to one or more protege firms must apply to the DoD for 
participation in the Program, pursuant to the application process set 
forth at I-106(d).
    (c) Once funding is made available by DoD, companies that are 
interested in becoming mentor firms that want to receive reimbursement 
only or a combination of reimbursement and credit for providing 
developmental assistance to one or more protege firms by either a 
separate contract, cooperative agreement or other agreement awarded for 
that purpose, will be solicited for participation in the Program through 
a program solicitation. The Program solicitation will be issued by DoD 
and will contain, among other things, the statement of work and the 
evaluation factors upon which award will be based. Companies seeking 
reimbursement only, or a combination of reimbursement and credit, must 
respond to the solicitation and will be evaluated on the quality of the 
proposed developmental assistance program for each protege, in 
accordance with the evaluation factors contained in the solicitation. 
Awards will be made by DoD to approved mentor firms, to provide the 
proposed developmental assistance to one or more identified protege 
firms.
I-103  Program duration.
    Activities under the Program may only occur during the following 
periods:

[[Page 675]]

    (a) From October 1, 1991, until September 30, 1998, companies may 
apply for participation in the Program as mentor firms pursuant to I-
102, General Procedures, and once approved, may enter into mentor-
protege agreements, pursuant to I-107, Mentor-Protege Agreements.
    (b) From October 1, 1991, until September 30, 1999, a mentor firm's 
costs of providing developmental assistance to its protege firm may be 
reimbursed only if--
    (1) Such costs are incurred after either a separate contact, 
cooperative agreement, or other agreement is entered into between DoD 
and the mentor firm;
    (2) The funding for such costs have been identified by a DoD program 
manager and such costs are incurred pursuant to the execution of a 
separately priced contract line item added to a DoD contract(s); to
    (3) Such costs are included in indirect expense pools.
    (c) From October 1, 1991, until September 30, 1999, mentor firms may 
receive credit toward the attainment of such firm's goals for 
subcontract awards to SDBs for unreimbursed costs incurred in providing 
developmental assistance to its protege firms, only if such costs are 
incurred pursuant to an approved mentor-protege agreement.
I-104  Eligibility requirements for a protege firm.
    (a) An entity may qualify as a protege firm if it is--
    (1) An SDB concern as defined by section 8(d)(3)(C) of the Small 
Business Act (15 U.S.C. 637(D)(3)(C)) which is--
    (i) Eligible for the award of Federal contracts; and
    (ii) A small business according to the SBA size standard for the 
Standard Industrial Classification (SIC) code which represents the 
contemplated supplies or services to be provided by the protege firm to 
the mentor firm;
    (2) A business entity that meets the criteria in (a)(1) of this 
section and is owned and controlled by either an Indian tribe as defined 
by section 8(a)(13) of the Small Business Act (15 U.S.C. 637(a)(13)) or 
a Native Hawaiian Organization as defined by section 8(a)(15) of the 
Small Business Act (15 U.S.C. 637(a)(15)); or
    (3) A qualified organization employing the severely disabled as 
defined in Pub. L. 102-172, section 8064A.
    (b) A protege firm may self-certify to a mentor firm that it meets 
the eligibility requirements in paragraphs I-104(a)(1), (2), or (3). 
Mentor firms may rely in good faith on a written representation that the 
entity meets the requirements of paragraphs I-104(a) (1), (2), or (3).
    (c) A protege firm may have only one active mentor-protege 
agreement.
I-105  Selection of protege firms.
    (a) Mentor firms will be solely responsible for selecting protege 
firms. Mentor firms are encouraged to identify and select protege firms 
that are defined as emerging SDB concerns.
    (b) The selection of protege firms by mentor firms may not be 
protested, except as in I-105(c).
    (c) In the event of a protest regarding the size or disadvantaged 
status of an entity selected to be a protege firm as defined in either 
paragraph I-104(a)(1) or (2), the mentor firm shall refer the protest to 
the Small Business Administration (SBA) to resolve in accordance with 13 
CFR part 121 (with respect to size) or 13 CFR part 124 (with respect to 
disadvantaged status).
    (d) For purposes of the Small Business Act, no determination of 
affiliation or control (either direct or indirect) may be found between 
a protege firm and its mentor firm on the basis that the mentor firm has 
agreed to furnish (or has furnished) to its protege firm pursuant to a 
mentor-protege agreement any form of developmental assistance described 
in paragraph I-107(f).
    (e) If at any time pursuant to paragraph I-105(c), the protege firm 
is determined by the SBA not to be a small disadvantaged business 
concern, assistance furnished such business concern by the mentor firm 
after the date of the determination, may not be considered assistance 
furnished under the program.
I-106  Approval process for companies to participate in the Program as 
mentor firms.
    (a) On or after October 1, 1991, a company that is interested in 
becoming a mentor firm that is seeking credit only against SDB 
subcontracting goals for costs incurred under the Program, or 
reimbursement of developmental assistance costs via inclusion of program 
costs in indirect expense pools and credit for such costs, must submit a 
request to the DoD, DUSD(I&CP)SADBU to be approved as a mentor firm 
under the Program. The request will be evaluated on the extent to which 
the company's proposal addresses the items listed in paragraphs (b) and 
(c) of this section. To the maximum extent possible, the request should 
be limited to not more than 10 pages, single spaced. A company may 
identify more than one protege in its request for approval under the 
Program. The information required in paragraphs I-106(b) and (c) must be 
submitted to be considered for approval as a mentor firm, and may cover 
one or more proposed mentor-protege relationships.
    (b) A company must indicate whether it is interested in 
participating in the Program pursuant to paragraph I-100(d), (2), (3), 
or (4), and submit the following information:

[[Page 676]]

    (1) A statement that the company is currently performing under at 
least one active approved subcontracting plan negotiated with DoD or 
another Federal agency pursuant to FAR 19.702, and that the company is 
currently eligible for the award of Federal contracts.
    (2) The number of proposed mentor-protege relationships covered by 
the request for approval as a mentor firm.
    (3) A summary of the company's historical and recent activities and 
accomplishments under their SDB program.
    (4) The total dollar amount of DoD contracts and subcontracts 
received by the company during the two preceding fiscal years (show 
prime contracts and subcontracts separately per year).
    (5) The total dollar amount of all other federal agency contracts 
and subcontracts received by the company during the two preceding fiscal 
years (show prime contracts and subcontracts separately per year).
    (6) The total dollar amount of subcontracts awarded by the company 
under DoD contracts during the two preceding fiscal years.
    (7) The total dollar amount of subcontracts awarded by the company 
under all other Federal agency contracts during the two preceding fiscal 
years.
    (8) The total dollar amount and percentage of subcontract awards 
made to all SDB firms under DoD contracts and other Federal agency 
contracts during the two preceding fiscal years (show DoD separately). 
If presently required to submit a SF 295, provide copies of the two 
preceding years end reports.
    (9) The number and total dollar amount of subcontract awards made to 
the identified protege firm(s) during the two preceding fiscal years (if 
any). Show DoD subcontract awards and other Federal agency subcontract 
awards separately.
    (c) In addition to the information required in paragraph I-106(b), 
companies must submit the following information for each proposed 
mentor-protege relationship:
    (1) Information on the company's ability to provide developmental 
assistance to the identified protege firm and how that assistance will 
potentially increase subcontracting opportunities in industry categories 
where SDBs are not dominant in the company's vendor base.
    (2) A letter of intent indicating that both the mentor firm and the 
protege firm will negotiate a mentor-protege agreement. The letter of 
intent must be signed by both parties and contain the following 
information:
    (i) The name, address, and telephone number of both parties.
    (ii) The protege firm's business classification, based upon the SIC 
code(s) which represents the contemplated supplies or services to be 
provided by the protege firm to the mentor firm.
    (iii) A statement that the protege firm meets the eligibility 
criteria in either paragraph I-104(a)(1), (2) or (3).
    (iv) A preliminary assessment of the developmental needs of the 
protege firm and the proposed developmental assistance the mentor firm 
envisions providing the protege firm to address those needs and enhance 
the protege firm's ability to perform successfully under contracts or 
subcontracts with DoD, other federal agencies and commercial contracts.
    (v) An estimate of the dollar amount and type of subcontracts that 
will be awarded by the mentor firm to the protege firm, and the period 
of time over which they will be awarded.
    (vi) Information as to whether the protege firm's development will 
be concentrated on a single major system, a service or supply program, 
research and development programs, initial production, mature systems, 
or in the mentor firm's overall contract base.
    (3) An estimate of the cost of the developmental assistance program 
and the period of time over which the assistance will be provided.
    (d) A company that has identified Program funds to be made available 
through a DoD program manager must provide: the information in 
paragraphs I-106(b) and (c) to the appropriate program manager and to 
the DUSD(I&CP)SADBU, with a letter signed by the appropriate program 
manager indicating the amount of funding that has been identified for 
the developmental assistance program.
    (e) Companies seeking credit only for the cost of developmental 
assistance, reimbursement of program costs via their inclusion in 
indirect expense pools and credit for such costs, or reimbursement with 
funds made available by a DoD program manager, shall submit four copies 
of the information specified in paragraphs I-106(b) and (c) to: DoD, 
DUSD(I&CP)SADBU, 3061 Defense Pentagon, Washington, DC. 20301-3061, 
Attn: Pilot Mentor-Protege Program Manager. Upon receipt of this 
information, DUSD(I&CP)SADBU will review and evaluate each request and, 
to the maximum extent possible, within 30 days advise each applicant of 
approval or rejection of its request to become a mentor firm.
    (f) Companies interested in reimbursement of costs of a 
developmental assistance program through either a separate contract, 
cooperative agreement, or other agreement awarded for that purpose will 
be solicited to provide the information in paragraphs I-106(b) and (c) 
as well as any other information specified in the program solicitation.
    (g) A company approved as a mentor firm for credit only, for 
reimbursement through funds made available by a DoD program manager, or 
for reimbursement via inclusion of program costs in indirect expense 
pools and credit for such costs, may proceed with

[[Page 677]]

the negotiation of the mentor-protege agreement with the identified 
protege firm(s).
    (h) Companies that apply for participation in the program pursuant 
to paragraph I-106(e) and are not approved, will be provided the reasons 
and an opportunity to submit additional information for reconsideration.
    (i) A company may not be approved for participation in the Program 
as a mentor firm if at the time of requesting participation in the 
Program it is currently debarred or suspended from contracting with the 
Federal government pursuant to FAR subpart 9.4.
    (j) If the mentor firm is suspended or debarred while performing 
under an approved mentor-protege agreement, the mentor firm--
    (1) May continue to provide assistance to its protege firms pursuant 
to approved mentor-protege agreements entered into prior to the 
imposition of such suspension or debarment;
    (2) May not be reimbursed or take credit for any costs of providing 
developmental assistance to its protege firm, incurred more than 30 days 
after the imposition of such suspension or debarment; and
    (3) Shall promptly give notice of its suspension or debarment to its 
protege firm and DUSD(I&CP)SADBU.
I-107  Mentor-protege agreements.
    (a) A signed mentor-protege agreement for each mentor-protege 
relationship identified under I-106(b)(2) must be submitted to 
DUSD(I&CP)SADBU and approved before developmental assistance costs may 
be incurred. To the maximum extent possible, such mentor-protege 
agreements will be approved within five business days of receipt.
    (b) Each signed mentor-protege agreement submitted for approval 
under the Program shall include--
    (1) The name, address and telephone number of the mentor firm and 
the protege firm and a point of contact within the mentor firm who will 
administer the developmental assistance program;
    (2) The SIC code which represents the contemplated supplies or 
services to be provided by the protege firm to the mentor firm and a 
statement that at the time the agreement is submitted for approval, the 
protege firm, if an SDB concern, does not exceed the size standard for 
the appropriate SIC code.
    (3) A developmental program for the protege firm specifying the type 
of assistance identified in paragraph I-107(f) that will be provided. 
The developmental program shall also include--
    (i) Factors to assess the protege firm's developmental progress 
under the Program including milestones for providing the identified 
assistance; and
    (ii) The anticipated number, dollar value, and type of subcontracts 
to be awarded the protege firm consistent with the extent and nature of 
mentor firm's business, and the period of time over which they will be 
awarded.
    (iii) The dollar value of the technical assistance program broken 
out per year.
    (4) A program participation term for the protege firm which shall 
not exceed nine years.
    (5) Procedures for the mentor firm to notify the protege firm in 
writing at least 30 days in advance of the mentor firm's intent to 
voluntarily withdraw its participation in the Program. Mentor firms may 
only voluntarily terminate the mentor-protege agreement(s) if they no 
longer want to be a participant in the Program as a mentor firm. 
Otherwise, a mentor firm must terminate a mentor-protege agreement for 
cause.
    (6) Procedures for a protege firm to notify the mentor firm in 
writing at least 30 days in advance of the protege firm's intent to 
voluntarily terminate the mentor-protege agreement.
    (7) Procedures for the mentor firm to terminate the mentor-protege 
agreement for cause which provide--
    (i) The protege firm shall be furnished a written notice of the 
proposed termination, stating the specific reasons for such action, at 
least 30 days in advance of the effective date of such proposed 
termination.
    (ii) The protege firm shall have 30 days to respond to such notice 
of proposed termination, and may rebut any findings believed to be 
erroneous and offer a remedial program.
    (iii) Upon prompt consideration of the protege firm's response, the 
mentor firm shall either withdraw the notice of proposed termination and 
continue the protege firm's participation, or issue the notice of 
termination.
    (iv) The decision of the mentor firm regarding termination for 
cause, conforming with the requirements of this section, shall be final 
and is not reviewable by DoD.
    (8) Additional terms and conditions as may be agreed upon by both 
parties.
    (c) Mentor firms shall send a copy of any termination notices to the 
DoD, DUSD(I&CP)SADBU, and where funding is made available through a DoD 
program manager, also provide a copy to the program manager and to the 
appropriate PCO of ACO.
    (d) Termination of a mentor-protege agreement shall not impair the 
obligations of the mentor firm to perform pursuant to its contractual 
obligations under Government contracts and subcontracts. Termination of 
all or part of the mentor-protege agreement shall not impair the 
obligations of the protege firm to perform pursuant to its contractual 
obligations under any contract awarded to the protege firm by the mentor 
firm.
    (e) Only developmental assistance provided after DoD approval of the 
mentor-protege agreement may be reimbursed.

[[Page 678]]

    (f) The mentor-protege agreement may provide for the mentor firm to 
furnish any or all of the types of developmental assistance as follows:
    (1) Assistance by mentor firm personnel in--
    (i) General business management, including organizational 
management, financial management, and personnel management, marketing, 
business development, and overall business planning;
    (ii) Engineering and technical matters such as production inventory 
control, quality assurance; and
    (iii) Any other assistance designed to develop the capabilities of 
the protege firm under the development program.
    (2) Award of subcontracts under DoD contracts or other contracts on 
a non-competitive basis.
    (3) Payment of progress payments for the performance of subcontracts 
by a protege firm in amounts as provided for in the subcontract; but in 
no event may any such progress payment exceed 100 percent of the costs 
incurred by the protege firm for the performance of the subcontract. 
Provision of progress payments by a mentor firm to a protege firm at a 
rate other than the customary rate for small disadvantaged businesses 
shall be implemented in accordance with FAR 32.504(c).
    (4) Advance payments under such subcontracts. Advance payments must 
be administered by the mentor firm in accordance with FAR subpart 32.4.
    (5) Loans.
    (6) Investment(s) in the protege firm in exchange for an ownership 
interest in the protege firm, not to exceed 10 percent of the total 
ownership interest. Investments may include but not be limited to cash, 
stock, contributions in kind, etc.
    (7) Assistance obtained by the mentor firm for the protege firm from 
one or more of the following:
    (i) Small Business Development Centers (SBDC) established pursuant 
to section 21 of the Small Business Act (15 U.S.C. 648).
    (ii) Entities providing procurement technical assistance pursuant to 
chapter 142 of Title 10 U.S.C. (Procurement Technical Assistance 
Centers.)
    (iii) Historically Black Colleges and Universities.
    (iv) Minority institutions of higher education.
    (g) A mentor firm may not require an SDB concern to enter into a 
mentor-protege agreement as a condition for being awarded a contract by 
the mentor firm including a subcontract under a DoD contract awarded to 
the mentor firm.
I-108  Reimbursement procedures.
    (a) A mentor firm may be reimbursed only for the cost of 
developmental assistance incurred by the mentor firm and provided to a 
protege firm under I-107(f) (1) and (7), and pursuant to an approved 
mentor-protege agreement. Reimbursement shall be made only through 
either a separate contract, cooperative agreement, or other agreement 
entered into between the DoD and the mentor firm awarded for the purpose 
of providing developmental assistance to one or more protege firms; a 
separately priced contract line item in a DoD contract; or inclusion of 
program costs in indirect expense pools. No other means for the 
reimbursement of the costs of developmental assistance provided under I-
107(f) (1) and (7) are authorized under the Program.
    (b) Costs reimbursed via inclusion in indirect expense pools may be 
reimbursed only to the extent that they are otherwise reasonable, 
allocable, and allowable.
    (c) Assistance provided in the form of progress payments in excess 
of the customary progress payment rate for SDBs, shall be reimbursed 
only if implemented in accordance with FAR 32.504(c).
    (d) Assistance provided in the form of advance payments shall be 
reimbursed only if they have been provided to a protege firm under 
subcontract terms and conditions similar to FAR 52.232-12. Reimbursement 
of any advance payments shall be made pursuant to the inclusion of DFARS 
252.232-7008, Reimbursement of Advance Payments--DoD Pilot Mentor-
Protege Program, in appropriate contracts. In requesting reimbursement, 
the mentor firm agrees that the risk of any financial loss due to the 
failure or inability of a protege firm to repay any unliquidated advance 
payments shall be the sole responsibility of the mentor firm.
    (e) No other forms of developmental assistance are authorized for 
reimbursement under the Program.
I-109  Credit for unreimbursed developmental assistance costs.
    (a) Developmental assistance costs incurred by a mentor firm for 
providing assistance to a protege firm pursuant to an approved mentor 
protege agreement, which have not been reimbursed through either a 
separate contract, cooperative agreement, or other agreement entered 
into between DoD and the mentor firm, or through a separately priced 
contract line item added to a DoD contract, may be credited as if it 
were a subcontract award for determining the performance of such mentor 
firm in attaining an SDB subcontracting goal(s) established under any 
contract containing a subcontracting plan pursuant to FAR 52.219-9.
    (b) For crediting purposes only, costs that have been reimbursed via 
inclusion in indirect expense pools may also be credited as subcontract 
awards for determining the performance of such mentor firm in attaining 
an SDB subcontracting goal(s) established

[[Page 679]]

under any contract containing a subcontracting plan pursuant to FAR 
52.219-9. However, costs that have not been reimbursed because they are 
not reasonable, allocable, or allowable under I-108(b), shall not be 
recognized for crediting purposes.
    (c) Other costs that are not eligible for reimbursement pursuant to 
I-108(a) may be recognized for credit only if requested, identified, and 
incorporated in an approved mentor-protege agreement. Such costs are not 
eligible for reimbursement.
    (d) The amount of credit a mentor firm may receive for any such 
unreimbursed developmental assistance costs shall be equal to--
    (1) Four times the total amount of such costs attributable to 
assistance provided by small business development centers (SBDC), 
historically black colleges and universities (HBCU), minority 
institutions (MI), and procurement technical assistance centers (PTAC).
    (2) Three times the total amount of such costs attributable to 
assistance furnished by the mentor's employees.
    (3) Two times the total amount of other such costs incurred by the 
mentor in carrying out the developmental assistance program.
    (e) A mentor firm may receive credit toward the attainment of an SDB 
subcontracting goal(s) for each subcontract awarded for a product or a 
service by the mentor firm to an entity that qualifies as a protege firm 
pursuant to I-104(a). With respect to a former SDB protege (firm(s), a 
mentor may take credit for awards to such concern(s) that, except for 
its size would be a small business concern owned and controlled by 
socially and economically disadvantaged individuals, but only if--
    (1) The size of such business concern is not more than two times the 
appropriate size standard;
    (2) The business concern formerly had a mentor-protege agreement 
with such mentor firm that was not terminated for cause; and
    (3) The credit is taken not later than October 1, 1999.
    (f) Amounts credited toward the SDB goal(s) for unreimbursed costs 
under the Program shall be separately identified from the amounts 
credited toward the goal resulting from the award of actual subcontracts 
to protege firms. The combination of the two shall equal the mentor 
firm's overall accomplishment toward the SDB goal(s).
    (g) Adjustments may be made to the amount of credit claimed under 
paragraphs I-109(a) and (b) if the DoD Director of Small and 
Disadvantaged Business Utilization determines that--
    (1) A mentor firm's performance in the attainment of its SDB 
subcontracting goals through actual subcontract awards declined from the 
prior fiscal year without justifiable cause.
    (2) Imposition of such a limitation on credit appears to be 
warranted to prevent abuse of this incentive for mentor firm's 
participation in the Program.
    (h) The mentor firm shall be afforded the opportunity to explain the 
decline in SDB participation before imposition of any such limitation on 
credit. In making the final decision to impose a limitation on credit, 
the DoD Director shall consider--
    (1) The mentor firm's overall SDB participation rates (in terms of 
percentages of subcontract awards and dollars awarded) as compared to 
the participation rates existing during the two fiscal years prior to 
the firm's admission to the Program;
    (2) The mentor firm's aggregate prime contract awards during the 
prior two fiscal years and the total amount of subcontract awards under 
such contracts; and
    (3) Such other information the mentor firm may wish to submit.
    (i) The decision of the Director regarding the imposition of a 
limitation on credit shall be final.
    (j) Any prospective limitation on credit imposed by the Director 
shall be expressed as a percentage of otherwise eligible credit and 
shall apply beginning on a specific date in the future and continue 
until a date certain during the current fiscal year.
    (k) Any retroactive limitation on credit imposed by the Director 
shall reflect the actual costs incurred for developmental assistance 
(not exceeding the maximum amount reimbursed).
    (l) For purposes of calculating any incentives to be paid to a 
mentor firm for exceeding an SDB subcontracting goal pursuant to 
252.219-7009, incentives shall be paid only if an SDB subcontracting 
goal has been exceeded as a result of actual subcontract awards to SDBs 
(excluding credit under paragraphs I-109 (a), (b) and (c)).
    (m) Developmental assistance costs that are incurred pursuant to an 
approved mentor-protege agreement, and have been charged to, but not 
reimbursed through a separate contract, cooperative agreement, or other 
agreement entered into between the DoD and the mentor firm, or through a 
separately priced contract line item added to a DoD contract, shall not 
be otherwise reimbursed, either as a direct or indirect cost, under any 
other DoD contract, irrespective of whether the costs have been 
recognized for credit against SDB subcontracting goals.
    (n) Developmental assistance provided under an approved mentor-
protege agreement is distinct from, and shall not duplicate, any effort 
that is the normal and expected product of the award and administration 
of the mentor firm's subcontract. Costs associated with the latter shall 
be accumulated and charged in accordance with the

[[Page 680]]

contractor's approved accounting practices; they are not considered 
developmental assistance costs eligible for either credit or 
reimbursement under the Program.
I-110  Advance agreements on the treatment of developmental assistance 
costs.
    Pursuant to FAR 31.109, approved mentor firms seeking reimbursement, 
credit, or a combination thereof, are strongly encouraged to enter into 
an advance agreement with the contracting officer responsible for 
determining final indirect cost rates under FAR 42.705. The purpose of 
the advance agreement is to establish the accounting treatment of the 
costs of the development assistance pursuant to the mentor-protege 
agreement prior to the incurring of any costs by the mentor firm. An 
advance agreement is an attempt by both the Government and the mentor 
firm to avoid possible subsequent dispute based on questions related to 
reasonableness, allocability, or allowability of the costs of 
developmental assistance under the Program. Absent an advance agreement, 
mentor firms are advised to establish the accounting treatment of such 
costs and address the need for any changes to their cost accounting 
practices that may result from the implementation of a mentor-protege 
agreement, prior to incurring any costs, and irrespective of whether 
costs will be reimbursed, credited or a combination thereof.
I-111  Reporting requirements and program reviews.
    (a) Mentor firms shall report on the progress made under active 
mentor-protege agreements semiannually by attaching to their SF 295--
    (1) A statement which includes--
    (i) The number of active mentor-protege agreements in effect; and
    (ii) The progress in achieving the developmental assistance 
objectives under each mentor-protege agreement, including whether the 
objectives of the Program set forth in I-100(c) were met, any problem 
areas encountered, and any other appropriate information.
    (2) A copy of the SF 294 for each contract where developmental 
assistance was credited, with a statement in Block 18 identifying--
    (i) The amount of dollars credited to the SDB subcontract goal as a 
result of developmental assistance provided to protege firms under the 
Program;
    (ii) An explanation as to the relationship between the developmental 
assistance provided the protege firm(s) under the Program and the 
activities under the contract covered by the SF 294(s); and
    (iii) The number and dollar value of subcontracts awarded to the 
protege firm(s), broken out per protege.
    (b) For commercial companies and companies participating in the DoD 
``Test Program for Negotiation of Comprehensive Small Business 
Subcontracting Plans,'' indicate in Block 16 of the SF 295--
    (1) The total dollars credited to the SDB goal as a result of 
developmental assistance provided to a protege firm(s) under the 
Program.
    (2) The total dollar amount of subcontracts awarded to the protege 
firm(s) broken our per protege.
    (c) The DUSD(I&CP)SADBU will conduct periodic performance reviews of 
the progress and accomplishments realized under approved mentor-protege 
agreements.
[59 FR 27701, May 27, 1994, as amended at 61 FR 50458, Sept. 26, 1996; 
61 FR 54346, Oct. 18, 1996; 62 FR 34141, June 24, 1997]
[[Page 681]]


                              FINDING AIDS




  --------------------------------------------------------------------

  A list of CFR titles, subtitles, chapters, subchapters and parts and 
an alphabetical list of agencies publishing in the CFR are included in 
the CFR Index and Finding Aids volume to the Code of Federal Regulations 
which is published separately and revised annually.
  Table of CFR Titles and Chapters
  Alphabetical List of Agencies Appearing in the CFR
  List of CFR Sections Affected



[[Page 683]]



                    Table of CFR Titles and Chapters




                   (Revised as of September 30, 1997)

                      Title 1--General Provisions

         I  Administrative Committee of the Federal Register 
                (Parts 1--49)
        II  Office of the Federal Register (Parts 50--299)
        IV  Miscellaneous Agencies (Parts 400--500)

                          Title 2--[Reserved]

                        Title 3--The President

         I  Executive Office of the President (Parts 100--199)

                           Title 4--Accounts

         I  General Accounting Office (Parts 1--99)
        II  Federal Claims Collection Standards (General 
                Accounting Office--Department of Justice) (Parts 
                100--299)

                   Title 5--Administrative Personnel

         I  Office of Personnel Management (Parts 1--1199)
        II  Merit Systems Protection Board (Parts 1200--1299)
       III  Office of Management and Budget (Parts 1300--1399)
        IV  Advisory Committee on Federal Pay (Parts 1400--1499)
         V  The International Organizations Employees Loyalty 
                Board (Parts 1500--1599)
        VI  Federal Retirement Thrift Investment Board (Parts 
                1600--1699)
       VII  Advisory Commission on Intergovernmental Relations 
                (Parts 1700--1799)
      VIII  Office of Special Counsel (Parts 1800--1899)
        IX  Appalachian Regional Commission (Parts 1900--1999)
        XI  Armed Forces Retirement Home (Part 2100)
       XIV  Federal Labor Relations Authority, General Counsel of 
                the Federal Labor Relations Authority and Federal 
                Service Impasses Panel (Parts 2400--2499)
        XV  Office of Administration, Executive Office of the 
                President (Parts 2500--2599)
       XVI  Office of Government Ethics (Parts 2600--2699)
       XXI  Department of the Treasury (Parts 3100--3199)
      XXII  Federal Deposit Insurance Corporation (Part 3201)
     XXIII  Department of Energy (Part 3301)

[[Page 684]]

      XXIV  Federal Energy Regulatory Commission (Part 3401)
      XXVI  Department of Defense (Part 3601)
    XXVIII  Department of Justice (Part 3801)
      XXIX  Federal Communications Commission (Parts 3900--3999)
       XXX  Farm Credit System Insurance Corporation (Parts 4000--
                4099)
      XXXI  Farm Credit Administration (Parts 4100--4199)
    XXXIII  Overseas Private Investment Corporation (Part 4301)
      XXXV  Office of Personnel Management (Part 4501)
        XL  Interstate Commerce Commission (Part 5001)
       XLI  Commodity Futures Trading Commission (Part 5101)
      XLII  Department of Labor (Part 5201)
     XLIII  National Science Foundation (Part 5301)
       XLV  Department of Health and Human Services (Part 5501)
      XLVI  Postal Rate Commission (Part 5601)
     XLVII  Federal Trade Commission (Part 5701)
    XLVIII  Nuclear Regulatory Commission (Part 5801)
         L  Department of Transportation (Part 6001)
       LII  Export-Import Bank of the United States (Part 6201)
      LIII  Department of Education (Parts 6300--6399)
       LIV  Environmental Protection Agency (Part 6401)
      LVII  General Services Administration (Part 6701)
     LVIII  Board of Governors of the Federal Reserve System (Part 
                6801)
       LIX  National Aeronautics and Space Administration (Part 
                6901)
        LX  United States Postal Service (Part 7001)
       LXI  National Labor Relations Board (Part 7101)
      LXII  Equal Employment Opportunity Commission (Part 7201)
     LXIII  Inter-American Foundation (Part 7301)
       LXV  Department of Housing and Urban Development (Part 
                7501)
      LXVI  National Archives and Records Administration (Part 
                7601)
      LXIX  Tennessee Valley Authority (Part 7901)
      LXXI  Consumer Product Safety Commission (Part 8101)
     LXXIV  Federal Mine Safety and Health Review Commission (Part 
                8401)
     LXXVI  Federal Retirement Thrift Investment Board (Part 8601)
    LXXVII  Office of Management and Budget (Part 8701)

                          Title 6--[Reserved]

                         Title 7--Agriculture

            Subtitle A--Office of the Secretary of Agriculture 
                (Parts 0--26)
            Subtitle B--Regulations of the Department of 
                Agriculture
         I  Agricultural Marketing Service (Standards, 
                Inspections, Marketing Practices), Department of 
                Agriculture (Parts 27--209)
        II  Food and Consumer Service, Department of Agriculture 
                (Parts 210--299)

[[Page 685]]

       III  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 300--399)
        IV  Federal Crop Insurance Corporation, Department of 
                Agriculture (Parts 400--499)
         V  Agricultural Research Service, Department of 
                Agriculture (Parts 500--599)
        VI  Natural Resources Conservation Service, Department of 
                Agriculture (Parts 600--699)
       VII  Farm Service Agency, Department of Agriculture (Parts 
                700--799)
      VIII  Grain Inspection, Packers and Stockyards 
                Administration (Federal Grain Inspection Service), 
                Department of Agriculture (Parts 800--899)
        IX  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Fruits, Vegetables, Nuts), Department 
                of Agriculture (Parts 900--999)
         X  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Milk), Department of Agriculture 
                (Parts 1000--1199)
        XI  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Miscellaneous Commodities), Department 
                of Agriculture (Parts 1200--1299)
      XIII  Northeast Dairy Compact Commission (Parts 1300--1399)
       XIV  Commodity Credit Corporation, Department of 
                Agriculture (Parts 1400--1499)
        XV  Foreign Agricultural Service, Department of 
                Agriculture (Parts 1500--1599)
       XVI  Rural Telephone Bank, Department of Agriculture (Parts 
                1600--1699)
      XVII  Rural Utilities Service, Department of Agriculture 
                (Parts 1700--1799)
     XVIII  Rural Housing Service, Rural Business-Cooperative 
                Service, Rural Utilities Service, and Farm Service 
                Agency, Department of Agriculture (Parts 1800--
                2099)
      XXVI  Office of Inspector General, Department of Agriculture 
                (Parts 2600--2699)
     XXVII  Office of Information Resources Management, Department 
                of Agriculture (Parts 2700--2799)
    XXVIII  Office of Operations, Department of Agriculture (Parts 
                2800--2899)
      XXIX  Office of Energy, Department of Agriculture (Parts 
                2900--2999)
       XXX  Office of the Chief Financial Officer, Department of 
                Agriculture (Parts 3000--3099)
      XXXI  Office of Environmental Quality, Department of 
                Agriculture (Parts 3100--3199)
     XXXII  [Reserved]
    XXXIII  Office of Transportation, Department of Agriculture 
                (Parts 3300--3399)
     XXXIV  Cooperative State Research, Education, and Extension 
                Service, Department of Agriculture (Parts 3400--
                3499)
      XXXV  Rural Housing Service, Department of Agriculture 
                (Parts 3500--3599)

[[Page 686]]

     XXXVI  National Agricultural Statistics Service, Department 
                of Agriculture (Parts 3600--3699)
    XXXVII  Economic Research Service, Department of Agriculture 
                (Parts 3700--3799)
   XXXVIII  World Agricultural Outlook Board, Department of 
                Agriculture (Parts 3800--3899)
       XLI  [Reserved]
      XLII  Rural Business-Cooperative Service and Rural Utilities 
                Service, Department of Agriculture (Parts 4200--
                4299)

                    Title 8--Aliens and Nationality

         I  Immigration and Naturalization Service, Department of 
                Justice (Parts 1--499)

                 Title 9--Animals and Animal Products

         I  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 1--199)
        II  Grain Inspection, Packers and Stockyards 
                Administration (Packers and Stockyards Programs), 
                Department of Agriculture (Parts 200--299)
       III  Food Safety and Inspection Service, Meat and Poultry 
                Inspection, Department of Agriculture (Parts 300--
                599)

                           Title 10--Energy

         I  Nuclear Regulatory Commission (Parts 0--199)
        II  Department of Energy (Parts 200--699)
       III  Department of Energy (Parts 700--999)
         X  Department of Energy (General Provisions) (Parts 
                1000--1099)
        XI  United States Enrichment Corporation (Parts 1100--
                1199)
        XV  Office of the Federal Inspector for the Alaska Natural 
                Gas Transportation System (Parts 1500--1599)
      XVII  Defense Nuclear Facilities Safety Board (Parts 1700--
                1799)

                      Title 11--Federal Elections

         I  Federal Election Commission (Parts 1--9099)

                      Title 12--Banks and Banking

         I  Comptroller of the Currency, Department of the 
                Treasury (Parts 1--199)
        II  Federal Reserve System (Parts 200--299)
       III  Federal Deposit Insurance Corporation (Parts 300--399)
        IV  Export-Import Bank of the United States (Parts 400--
                499)
         V  Office of Thrift Supervision, Department of the 
                Treasury (Parts 500--599)
        VI  Farm Credit Administration (Parts 600--699)
       VII  National Credit Union Administration (Parts 700--799)

[[Page 687]]

      VIII  Federal Financing Bank (Parts 800--899)
        IX  Federal Housing Finance Board (Parts 900--999)
        XI  Federal Financial Institutions Examination Council 
                (Parts 1100--1199)
       XIV  Farm Credit System Insurance Corporation (Parts 1400--
                1499)
        XV  Thrift Depositor Protection Oversight Board (Parts 
                1500--1599)
      XVII  Office of Federal Housing Enterprise Oversight, 
                Department of Housing and Urban Development (Parts 
                1700-1799)
     XVIII  Community Development Financial Institutions Fund, 
                Department of the Treasury (Parts 1800--1899)

               Title 13--Business Credit and Assistance

         I  Small Business Administration (Parts 1--199)
       III  Economic Development Administration, Department of 
                Commerce (Parts 300--399)

                    Title 14--Aeronautics and Space

         I  Federal Aviation Administration, Department of 
                Transportation (Parts 1--199)
        II  Office of the Secretary, Department of Transportation 
                (Aviation Proceedings) (Parts 200--399)
       III  Commercial Space Transportation, Federal Aviation 
                Administration, Department of Transportation 
                (Parts 400--499)
         V  National Aeronautics and Space Administration (Parts 
                1200--1299)

                 Title 15--Commerce and Foreign Trade

            Subtitle A--Office of the Secretary of Commerce (Parts 
                0--29)
            Subtitle B--Regulations Relating to Commerce and 
                Foreign Trade
         I  Bureau of the Census, Department of Commerce (Parts 
                30--199)
        II  National Institute of Standards and Technology, 
                Department of Commerce (Parts 200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)
        IV  Foreign-Trade Zones Board, Department of Commerce 
                (Parts 400--499)
       VII  Bureau of Export Administration, Department of 
                Commerce (Parts 700--799)
      VIII  Bureau of Economic Analysis, Department of Commerce 
                (Parts 800--899)
        IX  National Oceanic and Atmospheric Administration, 
                Department of Commerce (Parts 900--999)
        XI  Technology Administration, Department of Commerce 
                (Parts 1100--1199)
      XIII  East-West Foreign Trade Board (Parts 1300--1399)
       XIV  Minority Business Development Agency (Parts 1400--
                1499)

[[Page 688]]

            Subtitle C--Regulations Relating to Foreign Trade 
                Agreements
        XX  Office of the United States Trade Representative 
                (Parts 2000--2099)
            Subtitle D--Regulations Relating to Telecommunications 
                and Information
     XXIII  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                2300--2399)

                    Title 16--Commercial Practices

         I  Federal Trade Commission (Parts 0--999)
        II  Consumer Product Safety Commission (Parts 1000--1799)

             Title 17--Commodity and Securities Exchanges

         I  Commodity Futures Trading Commission (Parts 1--199)
        II  Securities and Exchange Commission (Parts 200--399)
        IV  Department of the Treasury (Parts 400--499)

          Title 18--Conservation of Power and Water Resources

         I  Federal Energy Regulatory Commission, Department of 
                Energy (Parts 1--399)
       III  Delaware River Basin Commission (Parts 400--499)
        VI  Water Resources Council (Parts 700--799)
      VIII  Susquehanna River Basin Commission (Parts 800--899)
      XIII  Tennessee Valley Authority (Parts 1300--1399)

                       Title 19--Customs Duties

         I  United States Customs Service, Department of the 
                Treasury (Parts 1--199)
        II  United States International Trade Commission (Parts 
                200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)

                     Title 20--Employees' Benefits

         I  Office of Workers' Compensation Programs, Department 
                of Labor (Parts 1--199)
        II  Railroad Retirement Board (Parts 200--399)
       III  Social Security Administration (Parts 400--499)
        IV  Employees' Compensation Appeals Board, Department of 
                Labor (Parts 500--599)
         V  Employment and Training Administration, Department of 
                Labor (Parts 600--699)
        VI  Employment Standards Administration, Department of 
                Labor (Parts 700--799)
       VII  Benefits Review Board, Department of Labor (Parts 
                800--899)
      VIII  Joint Board for the Enrollment of Actuaries (Parts 
                900--999)

[[Page 689]]

        IX  Office of the Assistant Secretary for Veterans' 
                Employment and Training, Department of Labor 
                (Parts 1000--1099)

                       Title 21--Food and Drugs

         I  Food and Drug Administration, Department of Health and 
                Human Services (Parts 1--1299)
        II  Drug Enforcement Administration, Department of Justice 
                (Parts 1300--1399)
       III  Office of National Drug Control Policy (Parts 1400--
                1499)

                      Title 22--Foreign Relations

         I  Department of State (Parts 1--199)
        II  Agency for International Development, International 
                Development Cooperation Agency (Parts 200--299)
       III  Peace Corps (Parts 300--399)
        IV  International Joint Commission, United States and 
                Canada (Parts 400--499)
         V  United States Information Agency (Parts 500--599)
        VI  United States Arms Control and Disarmament Agency 
                (Parts 600--699)
       VII  Overseas Private Investment Corporation, International 
                Development Cooperation Agency (Parts 700--799)
        IX  Foreign Service Grievance Board Regulations (Parts 
                900--999)
         X  Inter-American Foundation (Parts 1000--1099)
        XI  International Boundary and Water Commission, United 
                States and Mexico, United States Section (Parts 
                1100--1199)
       XII  United States International Development Cooperation 
                Agency (Parts 1200--1299)
      XIII  Board for International Broadcasting (Parts 1300--
                1399)
       XIV  Foreign Service Labor Relations Board; Federal Labor 
                Relations Authority; General Counsel of the 
                Federal Labor Relations Authority; and the Foreign 
                Service Impasse Disputes Panel (Parts 1400--1499)
        XV  African Development Foundation (Parts 1500--1599)
       XVI  Japan-United States Friendship Commission (Parts 
                1600--1699)
      XVII  United States Institute of Peace (Parts 1700--1799)

                          Title 23--Highways

         I  Federal Highway Administration, Department of 
                Transportation (Parts 1--999)
        II  National Highway Traffic Safety Administration and 
                Federal Highway Administration, Department of 
                Transportation (Parts 1200--1299)
       III  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 1300--1399)

[[Page 690]]

                Title 24--Housing and Urban Development

            Subtitle A--Office of the Secretary, Department of 
                Housing and Urban Development (Parts 0--99)
            Subtitle B--Regulations Relating to Housing and Urban 
                Development
         I  Office of Assistant Secretary for Equal Opportunity, 
                Department of Housing and Urban Development (Parts 
                100--199)
        II  Office of Assistant Secretary for Housing-Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 200--299)
       III  Government National Mortgage Association, Department 
                of Housing and Urban Development (Parts 300--399)
         V  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 500--599)
        VI  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 600--699) [Reserved]
       VII  Office of the Secretary, Department of Housing and 
                Urban Development (Housing Assistance Programs and 
                Public and Indian Housing Programs) (Parts 700--
                799)
      VIII  Office of the Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Section 8 Housing Assistance 
                Programs and Section 202 Direct Loan Program) 
                (Parts 800--899)
        IX  Office of Assistant Secretary for Public and Indian 
                Housing, Department of Housing and Urban 
                Development (Parts 900--999)
         X  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Interstate Land Sales 
                Registration Program) (Parts 1700--1799)
       XII  Office of Inspector General, Department of Housing and 
                Urban Development (Parts 2000--2099)
        XX  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 3200--3899)
       XXV  Neighborhood Reinvestment Corporation (Parts 4100--
                4199)

                           Title 25--Indians

         I  Bureau of Indian Affairs, Department of the Interior 
                (Parts 1--299)
        II  Indian Arts and Crafts Board, Department of the 
                Interior (Parts 300--399)
       III  National Indian Gaming Commission, Department of the 
                Interior (Parts 500--599)
        IV  Office of Navajo and Hopi Indian Relocation (Parts 
                700--799)
         V  Bureau of Indian Affairs, Department of the Interior, 
                and Indian Health Service, Department of Health 
                and Human Services (Part 900)
        VI  Office of the Assistant Secretary-Indian Affairs, 
                Department of the Interior (Part 1001)

[[Page 691]]

       VII  Office of the Special Trustee for American Indians, 
                Department of the Interior (Part 1200)

                      Title 26--Internal Revenue

         I  Internal Revenue Service, Department of the Treasury 
                (Parts 1--799)

           Title 27--Alcohol, Tobacco Products and Firearms

         I  Bureau of Alcohol, Tobacco and Firearms, Department of 
                the Treasury (Parts 1--299)

                   Title 28--Judicial Administration

         I  Department of Justice (Parts 0--199)
       III  Federal Prison Industries, Inc., Department of Justice 
                (Parts 300--399)
         V  Bureau of Prisons, Department of Justice (Parts 500--
                599)
        VI  Offices of Independent Counsel, Department of Justice 
                (Parts 600--699)
       VII  Office of Independent Counsel (Parts 700--799)

                            Title 29--Labor

            Subtitle A--Office of the Secretary of Labor (Parts 
                0--99)
            Subtitle B--Regulations Relating to Labor
         I  National Labor Relations Board (Parts 100--199)
        II  Office of Labor-Management Standards, Department of 
                Labor (Parts 200--299)
       III  National Railroad Adjustment Board (Parts 300--399)
        IV  Office of Labor-Management Standards, Department of 
                Labor (Parts 400--499)
         V  Wage and Hour Division, Department of Labor (Parts 
                500--899)
        IX  Construction Industry Collective Bargaining Commission 
                (Parts 900--999)
         X  National Mediation Board (Parts 1200--1299)
       XII  Federal Mediation and Conciliation Service (Parts 
                1400--1499)
       XIV  Equal Employment Opportunity Commission (Parts 1600--
                1699)
      XVII  Occupational Safety and Health Administration, 
                Department of Labor (Parts 1900--1999)
        XX  Occupational Safety and Health Review Commission 
                (Parts 2200--2499)
       XXV  Pension and Welfare Benefits Administration, 
                Department of Labor (Parts 2500--2599)
     XXVII  Federal Mine Safety and Health Review Commission 
                (Parts 2700--2799)
        XL  Pension Benefit Guaranty Corporation (Parts 4000--
                4999)

[[Page 692]]

                      Title 30--Mineral Resources

         I  Mine Safety and Health Administration, Department of 
                Labor (Parts 1--199)
        II  Minerals Management Service, Department of the 
                Interior (Parts 200--299)
       III  Board of Surface Mining and Reclamation Appeals, 
                Department of the Interior (Parts 300--399)
        IV  Geological Survey, Department of the Interior (Parts 
                400--499)
        VI  Bureau of Mines, Department of the Interior (Parts 
                600--699)
       VII  Office of Surface Mining Reclamation and Enforcement, 
                Department of the Interior (Parts 700--999)

                 Title 31--Money and Finance: Treasury

            Subtitle A--Office of the Secretary of the Treasury 
                (Parts 0--50)
            Subtitle B--Regulations Relating to Money and Finance
         I  Monetary Offices, Department of the Treasury (Parts 
                51--199)
        II  Fiscal Service, Department of the Treasury (Parts 
                200--399)
        IV  Secret Service, Department of the Treasury (Parts 
                400--499)
         V  Office of Foreign Assets Control, Department of the 
                Treasury (Parts 500--599)
        VI  Bureau of Engraving and Printing, Department of the 
                Treasury (Parts 600--699)
       VII  Federal Law Enforcement Training Center, Department of 
                the Treasury (Parts 700--799)
      VIII  Office of International Investment, Department of the 
                Treasury (Parts 800--899)

                      Title 32--National Defense

            Subtitle A--Department of Defense
         I  Office of the Secretary of Defense (Parts 1--399)
         V  Department of the Army (Parts 400--699)
        VI  Department of the Navy (Parts 700--799)
       VII  Department of the Air Force (Parts 800--1099)
            Subtitle B--Other Regulations Relating to National 
                Defense
       XII  Defense Logistics Agency (Parts 1200--1299)
       XVI  Selective Service System (Parts 1600--1699)
       XIX  Central Intelligence Agency (Parts 1900--1999)
        XX  Information Security Oversight Office, National 
                Archives and Records Administration (Parts 2000--
                2099)
       XXI  National Security Council (Parts 2100--2199)
      XXIV  Office of Science and Technology Policy (Parts 2400--
                2499)
     XXVII  Office for Micronesian Status Negotiations (Parts 
                2700--2799)
    XXVIII  Office of the Vice President of the United States 
                (Parts 2800--2899)
      XXIX  Presidential Commission on the Assignment of Women in 
                the Armed Forces (Part 2900)

[[Page 693]]

               Title 33--Navigation and Navigable Waters

         I  Coast Guard, Department of Transportation (Parts 1--
                199)
        II  Corps of Engineers, Department of the Army (Parts 
                200--399)
        IV  Saint Lawrence Seaway Development Corporation, 
                Department of Transportation (Parts 400--499)

                          Title 34--Education

            Subtitle A--Office of the Secretary, Department of 
                Education (Parts 1--99)
            Subtitle B--Regulations of the Offices of the 
                Department of Education
         I  Office for Civil Rights, Department of Education 
                (Parts 100--199)
        II  Office of Elementary and Secondary Education, 
                Department of Education (Parts 200--299)
       III  Office of Special Education and Rehabilitative 
                Services, Department of Education (Parts 300--399)
        IV  Office of Vocational and Adult Education, Department 
                of Education (Parts 400--499)
         V  Office of Bilingual Education and Minority Languages 
                Affairs, Department of Education (Parts 500--599)
        VI  Office of Postsecondary Education, Department of 
                Education (Parts 600--699)
       VII  Office of Educational Research and Improvement, 
                Department of Education (Parts 700--799)
        XI  National Institute for Literacy (Parts 1100-1199)
            Subtitle C--Regulations Relating to Education
       XII  National Council on Disability (Parts 1200--1299)

                        Title 35--Panama Canal

         I  Panama Canal Regulations (Parts 1--299)

             Title 36--Parks, Forests, and Public Property

         I  National Park Service, Department of the Interior 
                (Parts 1--199)
        II  Forest Service, Department of Agriculture (Parts 200--
                299)
       III  Corps of Engineers, Department of the Army (Parts 
                300--399)
        IV  American Battle Monuments Commission (Parts 400--499)
         V  Smithsonian Institution (Parts 500--599)
       VII  Library of Congress (Parts 700--799)
      VIII  Advisory Council on Historic Preservation (Parts 800--
                899)
        IX  Pennsylvania Avenue Development Corporation (Parts 
                900--999)
        XI  Architectural and Transportation Barriers Compliance 
                Board (Parts 1100--1199)
       XII  National Archives and Records Administration (Parts 
                1200--1299)
       XIV  Assassination Records Review Board (Parts 1400-1499)

[[Page 694]]

             Title 37--Patents, Trademarks, and Copyrights

         I  Patent and Trademark Office, Department of Commerce 
                (Parts 1--199)
        II  Copyright Office, Library of Congress (Parts 200--299)
        IV  Assistant Secretary for Technology Policy, Department 
                of Commerce (Parts 400--499)
         V  Under Secretary for Technology, Department of Commerce 
                (Parts 500--599)

           Title 38--Pensions, Bonuses, and Veterans' Relief

         I  Department of Veterans Affairs (Parts 0--99)

                       Title 39--Postal Service

         I  United States Postal Service (Parts 1--999)
       III  Postal Rate Commission (Parts 3000--3099)

                  Title 40--Protection of Environment

         I  Environmental Protection Agency (Parts 1--799)
         V  Council on Environmental Quality (Parts 1500--1599)

          Title 41--Public Contracts and Property Management

            Subtitle B--Other Provisions Relating to Public 
                Contracts
        50  Public Contracts, Department of Labor (Parts 50-1--50-
                999)
        51  Committee for Purchase From People Who Are Blind or 
                Severely Disabled (Parts 51-1--51-99)
        60  Office of Federal Contract Compliance Programs, Equal 
                Employment Opportunity, Department of Labor (Parts 
                60-1--60-999)
        61  Office of the Assistant Secretary for Veterans 
                Employment and Training, Department of Labor 
                (Parts 61-1--61-999)
            Subtitle C--Federal Property Management Regulations 
                System
       101  Federal Property Management Regulations (Parts 101-1--
                101-99)
       105  General Services Administration (Parts 105-1--105-999)
       109  Department of Energy Property Management Regulations 
                (Parts 109-1--109-99)
       114  Department of the Interior (Parts 114-1--114-99)
       115  Environmental Protection Agency (Parts 115-1--115-99)
       128  Department of Justice (Parts 128-1--128-99)
            Subtitle D--Other Provisions Relating to Property 
                Management [Reserved]
            Subtitle E--Federal Information Resources Management 
                Regulations System
       201  Federal Information Resources Management Regulation 
                (Parts 201-1--201-99) [Reserved]
            Subtitle F--Federal Travel Regulation System
       301  Travel Allowances (Parts 301-1--301-99)
       302  Relocation Allowances (Parts 302-1--302-99)

[[Page 695]]

       303  Payment of Expenses Connected with the Death of 
                Certain Employees (Parts 303-1--303-2)
       304  Payment from a Non-Federal Source for Travel Expenses 
                (Parts 304-1--304-99)

                        Title 42--Public Health

         I  Public Health Service, Department of Health and Human 
                Services (Parts 1--199)
        IV  Health Care Financing Administration, Department of 
                Health and Human Services (Parts 400--499)
         V  Office of Inspector General-Health Care, Department of 
                Health and Human Services (Parts 1000--1999)

                   Title 43--Public Lands: Interior

            Subtitle A--Office of the Secretary of the Interior 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Lands
         I  Bureau of Reclamation, Department of the Interior 
                (Parts 200--499)
        II  Bureau of Land Management, Department of the Interior 
                (Parts 1000--9999)
       III  Utah Reclamation Mitigation and Conservation 
                Commission (Parts 10000--10005)

             Title 44--Emergency Management and Assistance

         I  Federal Emergency Management Agency (Parts 0--399)
        IV  Department of Commerce and Department of 
                Transportation (Parts 400--499)

                       Title 45--Public Welfare

            Subtitle A--Department of Health and Human Services 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Welfare
        II  Office of Family Assistance (Assistance Programs), 
                Administration for Children and Families, 
                Department of Health and Human Services (Parts 
                200--299)
       III  Office of Child Support Enforcement (Child Support 
                Enforcement Program), Administration for Children 
                and Families, Department of Health and Human 
                Services (Parts 300--399)
        IV  Office of Refugee Resettlement, Administration for 
                Children and Families Department of Health and 
                Human Services (Parts 400--499)
         V  Foreign Claims Settlement Commission of the United 
                States, Department of Justice (Parts 500--599)
        VI  National Science Foundation (Parts 600--699)
       VII  Commission on Civil Rights (Parts 700--799)
      VIII  Office of Personnel Management (Parts 800--899)

[[Page 696]]

         X  Office of Community Services, Administration for 
                Children and Families, Department of Health and 
                Human Services (Parts 1000--1099)
        XI  National Foundation on the Arts and the Humanities 
                (Parts 1100--1199)
       XII  ACTION (Parts 1200--1299)
      XIII  Office of Human Development Services, Department of 
                Health and Human Services (Parts 1300--1399)
       XVI  Legal Services Corporation (Parts 1600--1699)
      XVII  National Commission on Libraries and Information 
                Science (Parts 1700--1799)
     XVIII  Harry S. Truman Scholarship Foundation (Parts 1800--
                1899)
       XXI  Commission on Fine Arts (Parts 2100--2199)
      XXII  Christopher Columbus Quincentenary Jubilee Commission 
                (Parts 2200--2299)
     XXIII  Arctic Research Commission (Part 2301)
      XXIV  James Madison Memorial Fellowship Foundation (Parts 
                2400--2499)
       XXV  Corporation for National and Community Service (Parts 
                2500--2599)

                          Title 46--Shipping

         I  Coast Guard, Department of Transportation (Parts 1--
                199)
        II  Maritime Administration, Department of Transportation 
                (Parts 200--399)
        IV  Federal Maritime Commission (Parts 500--599)

                      Title 47--Telecommunication

         I  Federal Communications Commission (Parts 0--199)
        II  Office of Science and Technology Policy and National 
                Security Council (Parts 200--299)
       III  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                300--399)

           Title 48--Federal Acquisition Regulations System

         1  Federal Acquisition Regulation (Parts 1--99)
         2  Department of Defense (Parts 200--299)
         3  Department of Health and Human Services (Parts 300--
                399)
         4  Department of Agriculture (Parts 400--499)
         5  General Services Administration (Parts 500--599)
         6  Department of State (Parts 600--699)
         7  United States Agency for International Development 
                (Parts 700--799)
         8  Department of Veterans Affairs (Parts 800--899)
         9  Department of Energy (Parts 900--999)
        10  Department of the Treasury (Parts 1000--1099)

[[Page 697]]

        12  Department of Transportation (Parts 1200--1299)
        13  Department of Commerce (Parts 1300--1399)
        14  Department of the Interior (Parts 1400--1499)
        15  Environmental Protection Agency (Parts 1500--1599)
        16  Office of Personnel Management Federal Employees 
                Health Benefits Acquisition Regulation (Parts 
                1600--1699)
        17  Office of Personnel Management (Parts 1700--1799)
        18  National Aeronautics and Space Administration (Parts 
                1800--1899)
        19  United States Information Agency (Parts 1900--1999)
        20  Nuclear Regulatory Commission (Parts 2000--2099)
        21  Office of Personnel Management, Federal Employees 
                Group Life Insurance Federal Acquisition 
                Regulation (Parts 2100--2199)
        23  Social Security Administration (Parts 2300--2399)
        24  Department of Housing and Urban Development (Parts 
                2400--2499)
        25  National Science Foundation (Parts 2500--2599)
        28  Department of Justice (Parts 2800--2899)
        29  Department of Labor (Parts 2900--2999)
        34  Department of Education Acquisition Regulation (Parts 
                3400--3499)
        35  Panama Canal Commission (Parts 3500--3599)
        44  Federal Emergency Management Agency (Parts 4400--4499)
        51  Department of the Army Acquisition Regulations (Parts 
                5100--5199)
        52  Department of the Navy Acquisition Regulations (Parts 
                5200--5299)
        53  Department of the Air Force Federal Acquisition 
                Regulation Supplement (Parts 5300--5399)
        54  Defense Logistics Agency, Department of Defense (Part 
                5452)
        57  African Development Foundation (Parts 5700--5799)
        61  General Services Administration Board of Contract 
                Appeals (Parts 6100--6199)
        63  Department of Transportation Board of Contract Appeals 
                (Parts 6300--6399)
        99  Cost Accounting Standards Board, Office of Federal 
                Procurement Policy, Office of Management and 
                Budget (Parts 9900--9999)

                       Title 49--Transportation

            Subtitle A--Office of the Secretary of Transportation 
                (Parts 1--99)
            Subtitle B--Other Regulations Relating to 
                Transportation
         I  Research and Special Programs Administration, 
                Department of Transportation (Parts 100--199)
        II  Federal Railroad Administration, Department of 
                Transportation (Parts 200--299)

[[Page 698]]

       III  Federal Highway Administration, Department of 
                Transportation (Parts 300--399)
        IV  Coast Guard, Department of Transportation (Parts 400--
                499)
         V  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 500--599)
        VI  Federal Transit Administration, Department of 
                Transportation (Parts 600--699)
       VII  National Railroad Passenger Corporation (AMTRAK) 
                (Parts 700--799)
      VIII  National Transportation Safety Board (Parts 800--999)
         X  Surface Transportation Board, Department of 
                Transportation (Parts 1000--1399)

                   Title 50--Wildlife and Fisheries

         I  United States Fish and Wildlife Service, Department of 
                the Interior (Parts 1--199)
        II  National Marine Fisheries Service, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 200--299)
       III  International Fishing and Related Activities (Parts 
                300--399)
        IV  Joint Regulations (United States Fish and Wildlife 
                Service, Department of the Interior and National 
                Marine Fisheries Service, National Oceanic and 
                Atmospheric Administration, Department of 
                Commerce); Endangered Species Committee 
                Regulations (Parts 400--499)
         V  Marine Mammal Commission (Parts 500--599)
        VI  Fishery Conservation and Management, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 600--699)

                      CFR Index and Finding Aids

            Subject/Agency Index
            List of Agency Prepared Indexes
            Parallel Tables of Statutory Authorities and Rules
            Acts Requiring Publication in the Federal Register
            List of CFR Titles, Chapters, Subchapters, and Parts
            Alphabetical List of Agencies Appearing in the CFR



[[Page 699]]





           Alphabetical List of Agencies Appearing in the CFR




                   (Revised as of September 30, 1997)

                                                  CFR Title, Subtitle or 
                     Agency                               Chapter

ACTION                                            45, XII
Administrative Committee of the Federal Register  1, I
Advanced Research Projects Agency                 32, I
Advisory Commission on Intergovernmental          5, VII
     Relations
Advisory Committee on Federal Pay                 5, IV
Advisory Council on Historic Preservation         36, VIII
African Development Foundation                    22, XV
  Federal Acquisition Regulation                  48, 57
Agency for International Development, United      22, II
     States
  Federal Acquisition Regulation                  48, 7
Agricultural Marketing Service                    7, I, IX, X, XI
Agricultural Research Service                     7, V
Agriculture Department
  Agricultural Marketing Service                  7, I, IX, X, XI
  Agricultural Research Service                   7, V
  Animal and Plant Health Inspection Service      7, III; 9, I
  Chief Financial Officer, Office of              7, XXX
  Commodity Credit Corporation                    7, XIV
  Cooperative State Research, Education, and      7, XXXIV
       Extension Service
  Economic Research Service                       7, XXXVII
  Energy, Office of                               7, XXIX
  Environmental Quality, Office of                7, XXXI
  Farm Service Agency                             7, VII, XVIII
  Federal Acquisition Regulation                  48, 4
  Federal Crop Insurance Corporation              7, IV
  Food and Consumer Service                       7, II
  Food Safety and Inspection Service              9, III
  Foreign Agricultural Service                    7, XV
  Forest Service                                  36, II
  Grain Inspection, Packers and Stockyards        7, VIII; 9, II
       Administration
  Information Resources Management, Office of     7, XXVII
  Inspector General, Office of                    7, XXVI
  National Agricultural Library                   7, XLI
  National Agricultural Statistics Service        7, XXXVI
  Natural Resources Conservation Service          7, VI
  Operations, Office of                           7, XXVIII
  Rural Business-Cooperative Service              7, XVIII, XLII
  Rural Development Administration                7, XLII
  Rural Housing Service                           7, XVIII, XXXV
  Rural Telephone Bank                            7, XVI
  Rural Utilities Service                         7, XVII, XVIII, XLII
  Secretary of Agriculture, Office of             7, Subtitle A
  Transportation, Office of                       7, XXXIII
  World Agricultural Outlook Board                7, XXXVIII
Air Force Department                              32, VII
  Federal Acquisition Regulation Supplement       48, 53
Alaska Natural Gas Transportation System, Office  10, XV
     of the Federal Inspector
Alcohol, Tobacco and Firearms, Bureau of          27, I
AMTRAK                                            49, VII
American Battle Monuments Commission              36, IV
American Indians, Office of the Special Trustee   25, VII

[[Page 700]]

Animal and Plant Health Inspection Service        7, III; 9, I
Appalachian Regional Commission                   5, IX
Architectural and Transportation Barriers         36, XI
     Compliance Board
Arctic Research Commission                        45, XXIII
Armed Forces Retirement Home                      5, XI
Arms Control and Disarmament Agency, United       22, VI
     States
Army Department                                   32, V
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 51
Assassination Records Review Board                36, XIV
Benefits Review Board                             20, VII
Bilingual Education and Minority Languages        34, V
     Affairs, Office of
Blind or Severely Disabled, Committee for         41, 51
     Purchase From People Who Are
Board for International Broadcasting              22, XIII
Census Bureau                                     15, I
Central Intelligence Agency                       32, XIX
Chief Financial Officer, Office of                7, XXX
Child Support Enforcement, Office of              45, III
Children and Families, Administration for         45, II, III, IV, X
Christopher Columbus Quincentenary Jubilee        45, XXII
     Commission
Civil Rights, Commission on                       45, VII
Civil Rights, Office for                          34, I
Coast Guard                                       33, I; 46, I; 49, IV
Commerce Department                               44, IV
  Census Bureau                                   15, I`
  Economic Affairs, Under Secretary               37, V
  Economic Analysis, Bureau of                    15, VIII
  Economic Development Administration             13, III
  Emergency Management and Assistance             44, IV
  Export Administration, Bureau of                15, VII
  Federal Acquisition Regulation                  48, 13
  Fishery Conservation and Management             50, VI
  Foreign-Trade Zones Board                       15, IV
  International Trade Administration              15, III; 19, III
  National Institute of Standards and Technology  15, II
  National Marine Fisheries Service               50, II, IV
  National Oceanic and Atmospheric                15, IX; 50, II, III, IV, 
       Administration                             VI
  National Telecommunications and Information     15, XXIII; 47, III
       Administration
  National Weather Service                        15, IX
  Patent and Trademark Office                     37, I
  Productivity, Technology and Innovation,        37, IV
       Assistant Secretary for
  Secretary of Commerce, Office of                15, Subtitle A
  Technology, Under Secretary for                 37, V
  Technology Administration                       15, XI
  Technology Policy, Assistant Secretary for      37, IV
Commercial Space Transportation                   14, III
Commodity Credit Corporation                      7, XIV
Commodity Futures Trading Commission              5, XLI; 17, I
Community Planning and Development, Office of     24, V, VI
     Assistant Secretary for
Community Services, Office of                     45, X
Comptroller of the Currency                       12, I
Construction Industry Collective Bargaining       29, IX
     Commission
Consumer Product Safety Commission                5, LXXI; 16, II
Cooperative State Research, Education, and        7, XXXIV
     Extension Service
Copyright Office                                  37, II
Cost Accounting Standards Board                   48, 99
Council on Environmental Quality                  40, V
Customs Service, United States                    19, I
Defense Contract Audit Agency                     32, I
Defense Department                                5, XXVI; 32, Subtitle A
  Advanced Research Projects Agency               32, I
  Air Force Department                            32, VII

[[Page 701]]

  Army Department                                 32, V; 33, II; 36, III, 
                                                  48, 51
  Defense Intelligence Agency                     32, I
  Defense Logistics Agency                        32, I, XII; 48, 54
  Defense Mapping Agency                          32, I
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 2
  Navy Department                                 32, VI; 48, 52
  Secretary of Defense, Office of                 32, I
Defense Contract Audit Agency                     32, I
Defense Intelligence Agency                       32, I
Defense Logistics Agency                          32, XII; 48, 54
Defense Mapping Agency                            32, I
Defense Nuclear Facilities Safety Board           10, XVII
Delaware River Basin Commission                   18, III
Drug Enforcement Administration                   21, II
East-West Foreign Trade Board                     15, XIII
Economic Affairs, Under Secretary                 37, V
Economic Analysis, Bureau of                      15, VIII
Economic Development Administration               13, III
Economic Research Service                         7, XXXVII
Education, Department of                          5, LIII
  Bilingual Education and Minority Languages      34, V
       Affairs, Office of
  Civil Rights, Office for                        34, I
  Educational Research and Improvement, Office    34, VII
       of
  Elementary and Secondary Education, Office of   34, II
  Federal Acquisition Regulation                  48, 34
  Postsecondary Education, Office of              34, VI
  Secretary of Education, Office of               34, Subtitle A
  Special Education and Rehabilitative Services,  34, III
       Office of
  Vocational and Adult Education, Office of       34, IV
Educational Research and Improvement, Office of   34, VII
Elementary and Secondary Education, Office of     34, II
Employees' Compensation Appeals Board             20, IV
Employees Loyalty Board                           5, V
Employment and Training Administration            20, V
Employment Standards Administration               20, VI
Endangered Species Committee                      50, IV
Energy, Department of                             5, XXIII; 10, II, III, X
  Federal Acquisition Regulation                  48, 9
  Federal Energy Regulatory Commission            5, XXIV; 18, I
  Property Management Regulations                 41, 109
Energy, Office of                                 7, XXIX
Engineers, Corps of                               33, II; 36, III
Engraving and Printing, Bureau of                 31, VI
Enrichment Corporation, United States             10, XI
Environmental Protection Agency                   5, LIV; 40, I
  Federal Acquisition Regulation                  48, 15
  Property Management Regulations                 41, 115
Environmental Quality, Office of                  7, XXXI
Equal Employment Opportunity Commission           5, LXII; 29, XIV
Equal Opportunity, Office of Assistant Secretary  24, I
     for
Executive Office of the President                 3, I
  Administration, Office of                       5, XV
  Environmental Quality, Council on               40, V
  Management and Budget, Office of                25, III, LXXVII; 48, 99
  National Drug Control Policy, Office of         21, III
  National Security Council                       32, XXI; 47, 2
  Presidential Documents                          3
  Science and Technology Policy, Office of        32, XXIV; 47, II
  Trade Representative, Office of the United      15, XX
       States
Export Administration, Bureau of                  15, VII
Export-Import Bank of the United States           5, LII; 12, IV
Family Assistance, Office of                      45, II
Farm Credit Administration                        5, XXXI; 12, VI
Farm Credit System Insurance Corporation          5, XXX; 12, XIV

[[Page 702]]

Farm Service Agency                               7, VII, XVIII
Federal Acquisition Regulation                    48, 1
Federal Aviation Administration                   14, I
  Commercial Space Transportation                 14, III
Federal Claims Collection Standards               4, II
Federal Communications Commission                 5, XXIX; 47, I
Federal Contract Compliance Programs, Office of   41, 60
Federal Crop Insurance Corporation                7, IV
Federal Deposit Insurance Corporation             5, XXII; 12, III
Federal Election Commission                       11, I
Federal Emergency Management Agency               44, I
  Federal Acquisition Regulation                  48, 44
Federal Employees Group Life Insurance Federal    48, 21
     Acquisition Regulation
Federal Employees Health Benefits Acquisition     48, 16
     Regulation
Federal Energy Regulatory Commission              5, XXIV; 18, I
Federal Financial Institutions Examination        12, XI
     Council
Federal Financing Bank                            12, VIII
Federal Highway Administration                    23, I, II; 49, III
Federal Home Loan Mortgage Corporation            1, IV
Federal Housing Enterprise Oversight Office       12, XVII
Federal Housing Finance Board                     12, IX
Federal Inspector for the Alaska Natural Gas      10, XV
     Transportation System, Office of
Federal Labor Relations Authority, and General    5, XIV; 22, XIV
     Counsel of the Federal Labor Relations 
     Authority
Federal Law Enforcement Training Center           31, VII
Federal Maritime Commission                       46, IV
Federal Mediation and Conciliation Service        29, XII
Federal Mine Safety and Health Review Commission  5, LXXIV; 29, XXVII
Federal Pay, Advisory Committee on                5, IV
Federal Prison Industries, Inc.                   28, III
Federal Procurement Policy Office                 48, 99
Federal Property Management Regulations           41, 101
Federal Property Management Regulations System    41, Subtitle C
Federal Railroad Administration                   49, II
Federal Register, Administrative Committee of     1, I
Federal Register, Office of                       1, II
Federal Reserve System                            12, II
  Board of Governors                              5, LVIII
Federal Retirement Thrift Investment Board        5, VI, LXXVI
Federal Service Impasses Panel                    5, XIV
Federal Trade Commission                          5, XLVII; 16, I
Federal Transit Administration                    49, VI
Federal Travel Regulation System                  41, Subtitle F
Fine Arts, Commission on                          45, XXI
Fiscal Service                                    31, II
Fish and Wildlife Service, United States          50, I, IV
Fishery Conservation and Management               50, VI
Food and Drug Administration                      21, I
Food and Consumer Service                         7, II
Food Safety and Inspection Service                9, III
Foreign Agricultural Service                      7, XV
Foreign Assets Control, Office of                 31, V
Foreign Claims Settlement Commission of the       45, V
     United States
Foreign Service Grievance Board                   22, IX
Foreign Service Impasse Disputes Panel            22, XIV
Foreign Service Labor Relations Board             22, XIV
Foreign-Trade Zones Board                         15, IV
Forest Service                                    36, II
General Accounting Office                         4, I, II
General Services Administration                   5, LVII
  Contract Appeals, Board of                      48, 61
  Federal Acquisition Regulation                  48, 5
  Federal Property Management Regulations System  41, 101, 105
  Federal Travel Regulation System                41, Subtitle F
  Payment From a Non-Federal Source for Travel    41, 304
     Expenses
[[Page 703]]

  Payment of Expenses Connected With the Death    41, 303
       of Certain Employees
  Relocation Allowances                           41, 302
  Travel Allowances                               41, 301
Geological Survey                                 30, IV
Government Ethics, Office of                      5, XVI
Government National Mortgage Association          24, III
Grain Inspection, Packers and Stockyards          7, VIII; 9, II
     Administration
Great Lakes Pilotage                              46, III
Harry S. Truman Scholarship Foundation            45, XVIII
Health and Human Services, Department of          5, XLV; 45, Subtitle A
  Child Support Enforcement, Office of            45, III
  Children and Families, Administration for       45, II, III, IV, X
  Community Services, Office of                   45, X
  Family Assistance, Office of                    45, II
  Federal Acquisition Regulation                  48, 3
  Food and Drug Administration                    21, I
  Health Care Financing Administration            42, IV
  Human Development Services, Office of           45, XIII
  Indian Health Service                           25, V
  Inspector General (Health Care), Office of      42, V
  Public Health Service                           42, I
  Refugee Resettlement, Office of                 45, IV
Health Care Financing Administration              42, IV
Housing and Urban Development, Department of      5, LXV; 24, Subtitle B
  Community Planning and Development, Office of   24, V, VI
       Assistant Secretary for
  Equal Opportunity, Office of Assistant          24, I
       Secretary for
  Federal Acquisition Regulation                  48, 24
  Federal Housing Enterprise Oversight, Office    12, XVII
       of
  Government National Mortgage Association        24, III
  Housing--Federal Housing Commissioner, Office   24, II, VIII, X, XX
       of Assistant Secretary for
  Inspector General, Office of                    24, XII
  Public and Indian Housing, Office of Assistant  24, IX
       Secretary for
  Secretary, Office of                            24, Subtitle A, VII
Housing--Federal Housing Commissioner, Office of  24, II, VIII, X, XX
     Assistant Secretary for
Human Development Services, Office of             45, XIII
Immigration and Naturalization Service            8, I
Independent Counsel, Office of                    28, VII
Indian Affairs, Bureau of                         25, I, V
Indian Affairs, Office of the Assistant           25, VI
     Secretary
Indian Arts and Crafts Board                      25, II
Indian Health Service                             25, V
Information Agency, United States                 22, V
  Federal Acquisition Regulation                  48, 19
Information Resources Management, Office of       7, XXVII
Information Security Oversight Office, National   32, XX
     Archives and Records Administration
Inspector General
  Agriculture Department                          7, XXVI
  Health and Human Services Department            42, V
  Housing and Urban Development Department        24, XII
Institute of Peace, United States                 22, XVII
Inter-American Foundation                         5, LXIII; 22, X
Intergovernmental Relations, Advisory Commission  5, VII
     on
Interior Department
  American Indians, Office of the Special         25, VII
       Trustee
  Endangered Species Committee                    50, IV
  Federal Acquisition Regulation                  48, 14
  Federal Property Management Regulations System  41, 114
  Fish and Wildlife Service, United States        50, I, IV
  Geological Survey                               30, IV
  Indian Affairs, Bureau of                       25, I, V
  Indian Affairs, Office of the Assistant         25, VI
       Secretary
  Indian Arts and Crafts Board                    25, II

[[Page 704]]

  Land Management, Bureau of                      43, II
  Minerals Management Service                     30, II
  Mines, Bureau of                                30, VI
  National Indian Gaming Commission               25, III
  National Park Service                           36, I
  Reclamation, Bureau of                          43, I
  Secretary of the Interior, Office of            43, Subtitle A
  Surface Mining and Reclamation Appeals, Board   30, III
       of
  Surface Mining Reclamation and Enforcement,     30, VII
       Office of
Internal Revenue Service                          26, I
International Boundary and Water Commission,      22, XI
     United States and Mexico, United States 
     Section
International Development, United States Agency   22, II
     for
  Federal Acquisition Regulation                  48, 7
International Development Cooperation Agency,     22, XII
     United States
  International Development, United States        22, II; 48, 7
       Agency for
  Overseas Private Investment Corporation         5, XXXIII; 22, VII
International Fishing and Related Activities      50, III
International Investment, Office of               31, VIII
International Joint Commission, United States     22, IV
     and Canada
International Organizations Employees Loyalty     5, V
     Board
International Trade Administration                15, III; 19, III
International Trade Commission, United States     19, II
Interstate Commerce Commission                    5, XL
James Madison Memorial Fellowship Foundation      45, XXIV
Japan-United States Friendship Commission         22, XVI
Joint Board for the Enrollment of Actuaries       20, VIII
Justice Department                                5, XXVIII; 28, I
  Drug Enforcement Administration                 21, II
  Federal Acquisition Regulation                  48, 28
  Federal Claims Collection Standards             4, II
  Federal Prison Industries, Inc.                 28, III
  Foreign Claims Settlement Commission of the     45, V
       United States
  Immigration and Naturalization Service          8, I
  Offices of Independent Counsel                  28, VI
  Prisons, Bureau of                              28, V
  Property Management Regulations                 41, 128
Labor Department                                  5, XLII
  Benefits Review Board                           20, VII
  Employees' Compensation Appeals Board           20, IV
  Employment and Training Administration          20, V
  Employment Standards Administration             20, VI
  Federal Acquisition Regulation                  48, 29
  Federal Contract Compliance Programs, Office    41, 60
       of
  Federal Procurement Regulations System          41, 50
  Labor-Management Standards, Office of           29, II, IV
  Mine Safety and Health Administration           30, I
  Occupational Safety and Health Administration   29, XVII
  Pension and Welfare Benefits Administration     29, XXV
  Public Contracts                                41, 50
  Secretary of Labor, Office of                   29, Subtitle A
  Veterans' Employment and Training, Office of    41, 61; 20, IX
       the Assistant Secretary for
  Wage and Hour Division                          29, V
  Workers' Compensation Programs, Office of       20, I
Labor-Management Standards, Office of             29, II, IV
Land Management, Bureau of                        43, II
Legal Services Corporation                        45, XVI
Library of Congress                               36, VII
  Copyright Office                                37, II
Management and Budget, Office of                  5, III, LXXVII; 48, 99
Marine Mammal Commission                          50, V
Maritime Administration                           46, II
Merit Systems Protection Board                    5, II
Micronesian Status Negotiations, Office for       32, XXVII

[[Page 705]]

Mine Safety and Health Administration             30, I
Minerals Management Service                       30, II
Mines, Bureau of                                  30, VI
Minority Business Development Agency              15, XIV
Miscellaneous Agencies                            1, IV
Monetary Offices                                  31, I
National Aeronautics and Space Administration     5, LIX; 14, V
  Federal Acquisition Regulation                  48, 18
National Agricultural Library                     7, XLI
National Agricultural Statistics Service          7, XXXVI
National Archives and Records Administration      5, LXVI; 36, XII
  Information Security Oversight Office           32, XX
National Bureau of Standards                      15, II
National Capital Planning Commission              1, IV
National Commission for Employment Policy         1, IV
National Commission on Libraries and Information  45, XVII
     Science
National and Community Service, Corporation for   45, XXV
National Council on Disability                    34, XII
National Credit Union Administration              12, VII
National Drug Control Policy, Office of           21, III
National Foundation on the Arts and the           45, XI
     Humanities
National Highway Traffic Safety Administration    23, II, III; 49, V
National Indian Gaming Commission                 25, III
National Institute for Literacy                   34, XI
National Institute of Standards and Technology    15, II
National Labor Relations Board                    5, LXI; 29, I
National Marine Fisheries Service                 50, II, IV
National Mediation Board                          29, X
National Oceanic and Atmospheric Administration   15, IX; 50, II, III, IV, 
                                                  VI
National Park Service                             36, I
National Railroad Adjustment Board                29, III
National Railroad Passenger Corporation (AMTRAK)  49, VII
National Science Foundation                       5, XLIII; 45, VI
  Federal Acquisition Regulation                  48, 25
National Security Council                         32, XXI
National Security Council and Office of Science   47, II
     and Technology Policy
National Telecommunications and Information       15, XXIII; 47, III
     Administration
National Transportation Safety Board              49, VIII
National Weather Service                          15, IX
Natural Resources Conservation Service            7, VI
Navajo and Hopi Indian Relocation, Office of      25, IV
Navy Department                                   32, VI
  Federal Acquisition Regulation                  48, 52
Neighborhood Reinvestment Corporation             24, XXV
Northeast Dairy Compact Commission                7, XIII
Nuclear Regulatory Commission                     5, XLVIII; 10, I
  Federal Acquisition Regulation                  48, 20
Occupational Safety and Health Administration     29, XVII
Occupational Safety and Health Review Commission  29, XX
Offices of Independent Counsel                    28, VI
Operations Office                                 7, XXVIII
Overseas Private Investment Corporation           5, XXXIII; 22, VII
Panama Canal Commission                           48, 35
Panama Canal Regulations                          35, I
Patent and Trademark Office                       37, I
Payment From a Non-Federal Source for Travel      41, 304
     Expenses
Payment of Expenses Connected With the Death of   41, 303
     Certain Employees
Peace Corps                                       22, III
Pennsylvania Avenue Development Corporation       36, IX
Pension and Welfare Benefits Administration       29, XXV
Pension Benefit Guaranty Corporation              29, XL
Personnel Management, Office of                   5, I, XXXV; 45, VIII
  Federal Acquisition Regulation                  48, 17
  Federal Employees Group Life Insurance Federal  48, 21
     Acquisition Regulation
[[Page 706]]

  Federal Employees Health Benefits Acquisition   48, 16
       Regulation
Postal Rate Commission                            5, XLVI; 39, III
Postal Service, United States                     5, LX; 39, I
Postsecondary Education, Office of                34, VI
President's Commission on White House             1, IV
     Fellowships
Presidential Commission on the Assignment of      32, XXIX
     Women in the Armed Forces
Presidential Documents                            3
Prisons, Bureau of                                28, V
Productivity, Technology and Innovation,          37, IV
     Assistant Secretary
Public Contracts, Department of Labor             41, 50
Public and Indian Housing, Office of Assistant    24, IX
     Secretary for
Public Health Service                             42, I
Railroad Retirement Board                         20, II
Reclamation, Bureau of                            43, I
Refugee Resettlement, Office of                   45, IV
Regional Action Planning Commissions              13, V
Relocation Allowances                             41, 302
Research and Special Programs Administration      49, I
Rural Business-Cooperative Service                7, XVIII, XLII
Rural Development Administration                  7, XLII
Rural Housing Service                             7, XVIII, XXXV
Rural Telephone Bank                              7, XVI
Rural Utilities Service                           7, XVII, XVIII, XLII
Saint Lawrence Seaway Development Corporation     33, IV
Science and Technology Policy, Office of          32, XXIV
Science and Technology Policy, Office of, and     47, II
     National Security Council
Secret Service                                    31, IV
Securities and Exchange Commission                17, II
Selective Service System                          32, XVI
Small Business Administration                     13, I
Smithsonian Institution                           36, V
Social Security Administration                    20, III; 48, 23
Soldiers' and Airmen's Home, United States        5, XI
Special Counsel, Office of                        5, VIII
Special Education and Rehabilitative Services,    34, III
     Office of
State Department                                  22, I
  Federal Acquisition Regulation                  48, 6
Surface Mining and Reclamation Appeals, Board of  30, III
Surface Mining Reclamation and Enforcement,       30, VII
     Office of
Surface Transportation Board                      49, X
Susquehanna River Basin Commission                18, VIII
Technology Administration                         15, XI
Technology Policy, Assistant Secretary for        37, IV
Technology, Under Secretary for                   37, V
Tennessee Valley Authority                        5, LXIX; 18, XIII
Thrift Depositor Protection Oversight Board       12, XV
Thrift Supervision Office, Department of the      12, V
     Treasury
Trade Representative, United States, Office of    15, XX
Transportation, Department of                     5, L
  Coast Guard                                     33, I; 46, I; 49, IV
  Commercial Space Transportation                 14, III
  Contract Appeals, Board of                      48, 63
  Emergency Management and Assistance             44, IV
  Federal Acquisition Regulation                  48, 12
  Federal Aviation Administration                 14, I
  Federal Highway Administration                  23, I, II; 49, III
  Federal Railroad Administration                 49, II
  Federal Transit Administration                  49, VI
  Maritime Administration                         46, II
  National Highway Traffic Safety Administration  23, II, III; 49, V
  Research and Special Programs Administration    49, I
  Saint Lawrence Seaway Development Corporation   33, IV
  Secretary of Transportation, Office of          14, II; 49, Subtitle A
  Surface Transportation Board                    49, X

[[Page 707]]

Transportation, Office of                         7, XXXIII
Travel Allowances                                 41, 301
Treasury Department                               5, XXI; 17, IV
  Alcohol, Tobacco and Firearms, Bureau of        27, I
  Community Development Financial Institutions    12, XVIII
       Fund
  Comptroller of the Currency                     12, I
  Customs Service, United States                  19, I
  Engraving and Printing, Bureau of               31, VI
  Federal Acquisition Regulation                  48, 10
  Federal Law Enforcement Training Center         31, VII
  Fiscal Service                                  31, II
  Foreign Assets Control, Office of               31, V
  Internal Revenue Service                        26, I
  International Investment, Office of             31, VIII
  Monetary Offices                                31, I
  Secret Service                                  31, IV
  Secretary of the Treasury, Office of            31, Subtitle A
  Thrift Supervision, Office of                   12, V
Truman, Harry S. Scholarship Foundation           45, XVIII
United States and Canada, International Joint     22, IV
     Commission
United States and Mexico, International Boundary  22, XI
     and Water Commission, United States Section
United States Enrichment Corporation              10, XI
Utah Reclamation Mitigation and Conservation      43, III
     Commission
Veterans Affairs Department                       38, I
  Federal Acquisition Regulation                  48, 8
Veterans' Employment and Training, Office of the  41, 61; 20, IX
     Assistant Secretary for
Vice President of the United States, Office of    32, XXVIII
Vocational and Adult Education, Office of         34, IV
Wage and Hour Division                            29, V
Water Resources Council                           18, VI
Workers' Compensation Programs, Office of         20, I
World Agricultural Outlook Board                  7, XXXVIII

[[Page 709]]



List of CFR Sections Affected



All changes in this volume of the Code of Federal Regulations which were 
made by documents published in the Federal Register since January 1, 
1986, are enumerated in the following list. Entries indicate the nature 
of the changes effected. Page numbers refer to Federal Register pages. 
The user should consult the entries for chapters and parts as well as 
sections for revisions.
For the period before January 1, 1986, see the ``List of CFR Sections 
Affected, 1973-1985,'' published in four separate volumes.

                                  1986

48 CFR
                                                                   51 FR
                                                                    Page
Chapter 2
Chapter 2  Revised.................................................46053
204.202  (c)(6) added; interim eff. to 9-30-87.....................42096
204.673  Revised; interim..........................................43201
204.673-1  Revised; interim........................................43201
204.673-2  Revised; interim........................................43202
204.673-3  Revised; interim........................................43202
204.673-4  Revised; interim........................................43202
204.673-5  Revised; interim........................................43202
205  Subchapter assignment; editorial note..........................6004
206  Subchapter assignment; editorial note..........................6004
213.203-2  Confirmed...............................................19552
213.505-2  Confirmed...............................................19552
215.900--215.973 (Subpart 215.9)  Revised; interim.................43202
217.7204  Confirmed; (a)(3) and (b)(3) amended.....................19552
222.7200--222.7202 (Subpart 222.72)  Added; interim.................4501
    Revised........................................................43355
223.7001--223.7004 (Subpart 223.70)  Added; interim................28944
    Eff. 8-1-86....................................................29231
223.7100--223.7105 (Subpart 223.71)  Added; interim eff. to 9-30-
        87.........................................................42096
228.7102  Removed; interim.........................................28945
    Eff. 8-1-86....................................................29231
230.7001--230.7007 (Subpart 230.70)  Revised; interim..............43208
232.070  Added.....................................................13513
    Effective date corrected.......................................16042
    Added; interim.................................................43211
232.102  (e)(2) revised............................................13513
    Effective date corrected.......................................16042
    Added; interim.................................................43211
232.111  (S-71) and (S-72) added...................................13513
    Effective date corrected.......................................16042
    (S-71) and (S-72) added; interim...............................43211
232.501-1  (a) amended; (S-70) added...............................13513
    Effective date corrected.......................................16042
    (a) revised; interim...........................................28946
    Revised; interim...............................................43211
232.502-1  (S-71) (1), (2), (4), (7), and (9) amended; interim.....43211
232.502-4  (S-72), (S-73), and (S-74) added........................13513
    Effective date corrected.......................................16042
    (S-73) corrected...............................................18587
    (S-72) through (S-74) added; interim...........................43211
240.470  Added; interim eff. to 9-30-87............................42096
242.302  (a)(39) added; interim....................................28945
    Eff. 8-1-86....................................................29231
242.705-1  (b)(5)(i) added.........................................12331
242.770  Revised...................................................13517
    Technical correction...........................................16042
242.770-1  Revised.................................................13518
    Technical correction...........................................16042
242.770-2  Correctly removed.......................................16042
246.701  Amended...................................................18588
246.702  (d) revised...............................................18588
246.703  Amended...................................................18588
246.710  Added.....................................................18588

[[Page 710]]

246.770-1  Amended.................................................18588
246.770-2  (a)(2) introductory text and (i) amended................18588
246.770-3  Revised.................................................18588
246.770-4  Amended.................................................18588
246.770-6  Amended.................................................18588
246.770-7  Revised.................................................18588
246.770-8  Revised.................................................18588
246.770-9  Introductory text amended; (d)(1)(ii) and (4) revised; 
        (d)(1)(iii) added..........................................18589
246.770-10  (a) removed; (b) redesignated as (a)...................18589
252.217-7242  Amended; interim.....................................28945
    Eff. 8-1-86....................................................29231
252.217-7270  Confirmed............................................19553
252.222-7002  Added; interim........................................4502
    Revised........................................................43355
252.223-7001  Added; interim.......................................28945
    Eff. 8-1-86....................................................29231
252.223-7002  Added; interim.......................................28946
    Eff. 8-1-86....................................................29231
    Introductory text corrected....................................31765
252.223-7003  Added; interim eff. to 9-30-88.......................42097
252.228-7007  Correctly removed....................................31765
252.232-7004  Amended; interim.....................................43211
252.232-7005  Added................................................13514
    Effective date corrected.......................................16042
    Added; interim.................................................43211
252.232-7006  Added................................................13514
    Effective date corrected.......................................16042
    Added; interim.................................................43212
252.232-7007  Added................................................13514
    Effective date corrected.......................................16042
    Corrected...............................................18587, 20651
    Added; interim.................................................43212
252.242-7003  Revised..............................................13518
    Technical correction...........................................16042
253.270  Amended; interim..........................................43210

                                  1987

48 CFR
                                                                   52 FR
                                                                    Page
Chapter 2
202.101  Amended...................................................34784
203.170  Added; interim............................................12385
203.170-1  Added; interim..........................................12385
203.170-2  Added; interim..........................................12385
    Corrected......................................................19870
203.170-3  Added; interim..........................................12385
203.170-4  Added; interim..........................................12386
203.170-5  Added; interim..........................................12386
203.571  Added.....................................................34784
203.571-1--203.571-2  Added........................................34784
203.571-3--203.571-5  Added........................................34785
203.7000--203.7002 (Subpart 203.70)  Added.........................34386
204.202  (c)(6) added; interim eff. to 9-30-88.....................36775
    (c)(6) added; interim eff. to 1-31-88...........................4318
204.470  Added; interim eff. to 9-30-88............................36775
204.471 (Subpart 204.4)  Added; interim eff. to 1-31-88.............4318
204.601  Added.....................................................34785
204.670-2  Amended.................................................36420
204.670-5  Added...................................................36420
204.671-4  (a) amended.............................................34785
204.671-5  (d)(9) and (e)(3)(iii) amended; (e)(3) (iv) and (v) 
        added; (f) revised; interim................................16264
    (e)(3)(iii) corrected; (e)(3)(v) correctly removed.............19871
    (b)(13)(xi), (d) introductory text, (7), (8), (9) and (10), 
and (e)(1)(ii) and (9)(iv) amended; (d)(2) revised.................34785
    (b)(5)(iii) revised; (f) introductory text removed; (f)(2) 
added..............................................................36421
204.673  Revised; final............................................28707
204.673-1  Revised; final..........................................28707
204.673-2  Revised; final..........................................28707
204.673-3  Revised; final..........................................28707
204.673-4  Revised; final..........................................28708
204.673-5  Removed; final..........................................28708
204.7200--204.7204 (Subpart 204.72)  Added; interim eff. to 1-31-
        88..........................................................4318
205.201  ( S-70) heading and text amended..........................34785
205.202  (a)(4)( S-70) added; interim..............................16264
    Correctly removed..............................................19871
205.203  Added.....................................................34785
205.205  Removed...................................................34785
205.207  (d) ( S-72) and ( S-73) added; interim....................16264
205.470  Added; interim............................................12387
206.203--206.203-70  Added; interim................................16264
206.302-1  Heading and (c)( S-70) amended..........................34785
207.103  (i) amended...............................................34785
207.105  (b) (5), (6) and (13) redesignated as (b) (2), (5) and 
        (12); new (b)(6) added.....................................34787

[[Page 711]]

207.302  (d)(2) amended............................................34787
208.102 (Subpart 208.1)  Added.....................................34787
208.404-2  (a) ( S-70) revised.......................................781
    Revised........................................................34787
208.404-70  Revised................................................33411
    Table corrected................................................34866
208.7003-1  Amended................................................34787
208.7003-6  Amended................................................34787
208.7006-3  (a) revised; (b) redesignated as (d); new (b) and (c) 
        added......................................................34787
209.406-1  (d) revised; (e) added..................................34387
209.406-4  (a) revised; (b) added..................................34387
210.001  Amended...................................................34787
210.002  Added.....................................................34787
213.203-1  Added...................................................33414
213.203-2  Revised.................................................33414
213.204  (b) amended...............................................33414
213.402  (b)(2) amended............................................33414
213.404  (b)(1) amended............................................33414
213.503  (b) (2) and (3) amended...................................33414
213.505-2  Revised.................................................33414
    ( S-73)(li) and (lii) amended; ( S-73(liii) added..............34787
213.505-70  Heading amended; (c) redesignated as (e), text and 
        table amended; new (c) and (d) added.......................33414
213.507  Added.....................................................33415
214.201  Revised...................................................19871
214.201-2  Added...................................................19871
214.202-1  (b) added...............................................34788
215.170  (c) amended...............................................34788
215.406  Added.....................................................19871
215.406-2  Added...................................................19871
215.805-5  (c)(1)( S-70) (A) and (B) revised.......................34788
215.872  Revised...................................................26346
215.873  Added......................................................1915
215.874  Added.....................................................34788
215.875  Added; interim............................................11277
    Correctly designated...........................................13447
215.900--215.973 (Subpart 215.9)  Revised; final...................28708
215.902  (a)(1)(i) and ( S-72) corrected...........................36419
215.970-1  (b)(2)(v) correctly added...............................30688
    (b)(2)(i) table, (ii) table, and (iv) and (4)(ii) and 
(c)(3)(i) corrected................................................36420
215.971-2  Corrected...............................................36420
215.972-1  (a) introductory text and (1) corrected.................36420
215.973  Corrected.................................................36420
215.1001  (b)(1) and (c) removed...................................34788
216.603-3  Added; interim..........................................12388
    Effective date note corrected..................................19872
216.703  (c) amended; interim......................................12388
    Effective date note corrected..................................19872
217.202  Added; interim............................................12388
    Effective date corrected.......................................19872
217.7202-1  (c) amended............................................34788
217.7202-4  (b) amended............................................34788
217.7204  (a) introductory text and (1) amended; (b) and (c) 
        redesignated as (c) and (d); new (c) (2) and (3) amended; 
        new (b) and (c)(4) added...................................11077
    (a) introductory text and (1) amended; (b) and (c) 
redesignated as (c) and (d); new (b) added.........................34788
217.7402  (c) added; interim.......................................12388
    Effective date note corrected..................................19872
217.7500--217.7504 (Subpart 217.75)  Added; interim................13288
    Effective date note corrected..................................19872
217.7503  (b)(3)(ii) and (4) corrected.............................23835
    (b)(5) corrected...............................................33415
219.000  Added; interim............................................16265
219.001  Added; interim............................................16265
219.201  (a) added; interim........................................16265
219.202-5  Existing text designated as (a); (b) added; interim.....16265
219.301--219.304 (Subpart 219.3)  Added; interim...................16265
219.304  (b) corrected.............................................19871
219.501  (b) added; (c), (d), and (g) amended; interim.............16266
219.501-70  Added; interim.........................................16266
219.502-3  Added; interim..........................................16266
219.502-4  Added; interim..........................................16266
219.502-70  (b) amended; interim...................................16266
219.502-72  Added; interim.........................................16266
219.503  ( S-70) added; interim....................................16267
219.504  (b) (1) through (4) redesignated as (b) (2) through (5); 
        new (b)(1) added; interim..................................16267
219.506  (a) added; (b) amended; interim...........................16267

[[Page 712]]

219.507  Added; interim............................................16267
219.508  ( S-71) added.............................................16267
219.801--219.803 (Subpart 219.8)  Added; interim...................16267
222.7200--222.7202 (Subpart 222.72)  Heading amended...............34788
222.7200  (a), (b) and (c) amended.................................34788
222.7201  Amended..................................................34788
223.7100--223.7105 (Subpart 223.71) added; interim eff. to 9-30-88
                                                                   36775
225.109  (a)(S-70) and (d)(S-70) amended...........................49414
225.302  ( S-72)(2)(i) amended.....................................34788
225.407  (a) (1) and (2) amended...................................49414
225.7000  Amended; interim.........................................12390
225.7001  Amended; interim.........................................12390
225.7008  Added; interim...........................................12390
225.7008  (b), (c), and (d) revised; (e) removed...................49414
225.7301  (b) revised..............................................34788
225.7304  (c)(1)(i)(C) amended.....................................34789
225.7305  (f) amended..............................................34789
227.470--227.482 (Subpart 227.4)  Revised..........................12391
227.471  Corrected.................................................36422
227.472-1  Introductory text, (a), and (b) heading corrected.......36422
227.472-2  Corrected...............................................36422
227.472-4  Heading corrected.......................................36422
227.472-5  Correctly designated....................................36422
227.473-1  (a) introductory text corrected.........................36422
227.473-3  (a) corrected...........................................36422
227.473-4  (a)(2) and (c) introductory text corrected..............36422
227.473-5  (a)(4)(i) heading and text and (ii)(A) corrected........36422
227.474-1  Corrected...............................................36422
227.475-2  (b) corrected...........................................36422
227.475-6  Corrected...............................................36422
227.475-8  Corrected...............................................36422
227.478-2  (a)(1)(ii) corrected....................................36422
227.478-3  Corrected...............................................36422
227.479  (b) corrected.............................................36422
227.480  (d) introductory text corrected...........................36422
227.481-1  (a)(3)(i), (d), and (f) corrected.......................36422
227.482  (a)(1)(iii), (2), and (3), (n), and (s) corrected; (l) 
        correctly designated.......................................36422
230.7001--230.7007 (Subpart 230.70)  Revised; final................28714
231.7001 (Subpart 231.70)  Added; interim...........................5771
232.102  ( S-70) added.............................................47005
232.103  Added; interim............................................30369
232.111  ( S-71) and ( S-72) added; interim........................30369
233.214  Amended...................................................34789
235.003  (a), (b), (b)( S-70), ( S-71) and ( S-72) revised.........24473
    (b)( S-71)(iv) correctly added.................................28148
242.771  Added; interim.............................................5772
243.102  Added; interim............................................12389
    Effective date note corrected..................................19872
243.201  (a) redesignated as ( S-70); ( S-71) added; interim.......12389
    Effective date note corrected..................................19872
244.304  (b)(1) (xvi), (xx), and (xxi) amended; (b)(1)(xxii) added
                                                             8908, 34789
245.106 (Subpart 245.1)  Added; interim............................12390
245.106 (Subpart 245.1)  Removed...................................49415
245.505-14  (a) revised; (b) added.................................39535
245.608-71  (g) revised............................................34789
245.7102-6  (b)(9) removed.........................................34789
248.201  Revised...................................................23835
252.203-7001  Added................................................34789
252.203-7002  Added; interim.......................................12386
    Corrected......................................................19870
252.203-7003  Added................................................34387
252.204-7006  Added; interim eff. to 1-31-88........................4319
252.204-7007  Added................................................36421
252.205-7000  Added; interim.......................................12387
252.215-7001  Added; interim.......................................11277
    Introductory text corrected....................................13447
    Redesignated as 252.215-7002; new 252.215-7001 added...........26347
252.215-7002  Redesignated from 252.215-7001.......................26347
252.217-7220  Removed..............................................34789
252.217-7270  Amended.......................................11077, 34789
252.219-7005  Added; interim.......................................16267
    Correctly designated; heading and text corrected...............19871
    Correctly designated; text corrected...........................22415
252.219-7006  Added; interim.......................................16267
    Corrected......................................................19871
252.223-7003  added; interim eff. to 9-30-88.......................36775

[[Page 713]]

252.225-7023  Added................................................49415
252.227-7013  Revised..............................................12405
    Corrected......................................................36423
252.227-7014--252.227-7015  Removed................................12405
252.227-7016  Revised..............................................12407
    Corrected......................................................36423
252.227-7017  Revised..............................................12407
    Corrected......................................................36423
252.227-7018  Revised..............................................12407
    Corrected......................................................36423
252.227-7019  Revised..............................................12408
252.227-7020  Revised..............................................12408
    Corrected......................................................36423
252.227-7021  Revised..............................................12408
    Corrected......................................................36423
252.227-7022  Revised..............................................12408
252.227-7023  Revised..............................................12408
    Corrected......................................................36423
252.227-7024  Revised..............................................12409
    Corrected......................................................36423
252.227-7025  Revised..............................................12409
    Corrected......................................................36423
252.227-7026  Revised..............................................12411
    Corrected......................................................36423
252.227-7027  Revised..............................................12411
    Corrected......................................................36423
252.227-7028  Revised..............................................12411
252.227-7029  Revised..............................................12411
252.227-7030  Revised..............................................12411
252.227-7031  Revised..............................................12411
252.227-7032  Revised..............................................12411
252.227-7033  Revised..............................................12412
252.227-7034  Revised..............................................12412
252.227-7035  Added................................................12412
252.227-7036  Added................................................12412
252.227-7037  Added................................................12412
252.231-7001  Added.................................................5772
    Corrected......................................................23836
252.231-7002  Added.................................................5772
252.232-7005  Added; interim.......................................30369
252.232-7006  Added; interim.......................................30369
252.245-7000  Added; interim.......................................12390
    Removed........................................................49415
253.204-70  Added..................................................36421
253.270  Amended; final............................................28716
    Amended.................................................33415, 39536
Chapter 2  Unpublished DAR Supplement No. 3 amended................39536
Chapter 2  Unpublished DAR Supplement No. 6 amended................34789

                                  1988

48 CFR
                                                                   53 FR
                                                                    Page
Chapter 2
201.103  (a) amended...............................................38179
201.602  Removed...................................................38236
201.602-1  Removed.................................................38236
201.670  Removed...................................................38236
201.670-1--201.670-5  Removed......................................38236
202.101  (a) amended..............................................38174,
                                                     38179, 38193, 38246
203.170  Addition confirmed........................................38236
203.170-1  Addition confirmed and amended..........................38236
203.170-2  Addition confirmed......................................38236
    Revised........................................................38237
203.170-3  Addition confirmed......................................38236
    Amended........................................................38237
203.170-4  Addition confirmed......................................38236
    (a) (1) and (2) amended........................................38237
203.170-5  Addition confirmed......................................38236
203.410  Removed...................................................38193
203.7001  Amended; interim.........................................38242
203.7002  Amended; interim.........................................38242
204.202  (c)(6) addition interim effectiveness extended to 1-1-89 
                                                                   32620
    (c)(6) addition at 52 FR 4318 confirmed and redesignated as 
(c)(7).............................................................38174
    (c)(6) addition at 52 FR 36775 confirmed and amended...........38237
    (c)(7) removed.................................................38246
204.470  Addition interim effectiveness extended to 1-1-89.........32620
    Addition at 52 FR 36775 confirmed..............................38237
204.471 (Subpart 204.4)  Addition confirmed........................38174
204.471  Removed...................................................38246
204.500--204.503 (Subpart 204.5)  Added............................51559
204.601--204.674-3 (Subpart 204.6)  Revised........................34091
204.670-2  Amended; interim........................................38242
    Corrected......................................................50413
204.670-4  Corrected...............................................50413
204.671-3  (d) (6) and (7) corrected...............................50413
204.671-4  (c) and (e) corrected...................................50413

[[Page 714]]

204.671-5  (d)(9) introductory text, (e)(3) (iii) and (iv) and 
        (f)(1)(vi) amended; (e)(1)(v) redesignated as (e)(1)(vi); 
        new (e) (1)(v) and (3) (v) through (viii) added; (f)(1) 
        introductory text revised; interim..........................5115
    Confirmed......................................................20628
    (b) amended....................................................43205
    (b), (c), (d), (e), and (f) corrected..........................50413
204.672-1  Corrected...............................................50414
204.672-5  (b), (c), (d), and (e) corrected........................50414
204.672-6  Corrected...............................................50414
204.673-1  Correctly added.........................................50414
204.673-2  Correctly added.........................................50414
204.673-3  Correctly added.........................................50414
204.673-4  Correctly added.........................................50415
204.706--204.706-1 (Subpart 204.7)  Removed........................38179
204.801  (c)(3) removed............................................38179
204.803  (a)(8) removed............................................38179
204.903 (Subpart 204.9)  Added.....................................43205
204.7200--204.7204 (Subpart 204.72)  Addition confirmed............38174
205.102  (a)(1) removed; (4)(i) redesignated as (a)(4)(i)..........38179
205.207  (d)(S-72) amended; (d)(S-73) revised; (d)(S-74) through 
        (d)(S-76) added; interim....................................5116
    Amendment at 53 FR 5114 confirmed; (d)(S-73) amended...........20628
    (d)(2), (S-70), and (S-71) removed; (e)(S-70) added............38174
    (b)(1) removed; interim........................................38242
205.470  Addition confirmed.................................10250, 38193
205.501  Removed...................................................38179
205.504  Removed...................................................38179
206.203-70  Revised; interim........................................5116
    Revision confirmed.............................................20628
206.270  Added; interim.............................................5116
    Addition confirmed.............................................20628
    Amended........................................................20628
206.302-1  (a)(S-70) added.........................................38202
206.302-3  Added...................................................51560
207.105  (a)(8) added..............................................35201
    (b)(12)(iv) amended............................................38174
208.002  (f) revised; (g)(2) amended...............................38179
208.070  (g)(1) amended............................................38246
208.404-1  (a) amended.............................................38174
208.405-2  (S-70)(1) amended.......................................38246
208.470-2  Revised..................................................1924
208.7007-4  Amended................................................38246
208.7100-1  Revised.................................................1925
208.7100-2  (a)(9) and (d) revised; (e) added.......................1925
    (d)(2) amended; interim........................................38242
    (d)(2) amended.................................................38246
208.7802-1  Amended................................................38203
208.7901--208.7904 (Subpart 208.79)  Added; interim................29333
209.103  (S-71) added; interim.....................................20632
209.105-70  (b) removed; (c) redesignated as (d)...................38193
209.170  Added.....................................................38193
209.170-1  Added...................................................38193
209.170-2  Added...................................................38194
209.170-3  Added...................................................38194
209.170-4  Added...................................................38194
209.202  (a)(1) amended.....................................38174, 38246
209.303  Removed...................................................38194
209.306  Removed...................................................38194
209.404  Removed...................................................38179
209.405  (a)(2)(iv) amended........................................38246
209.470  (c) amended...............................................38200
209.472-1  (c) removed; (d), (e), and (f) redesignated as (c), 
        (d), and (e)...............................................38237
210.001  Amended...................................................35201
210.002  (c) added.................................................35201
210.004  (a)(3) added..............................................35202
210.008  (g)(1) amended............................................38174
210.011  (S-73) added..............................................35202
    (S-71) amended.................................................38174
213.104  (a) removed...............................................38179
213.106  (c) removed...............................................50415
213.107  Added.....................................................38180
213.204  Removed...................................................38194
    Added..........................................................38218
213.503  (b) introductory text, (1) and (3) redesignated as 
        (b)(1), (d)(1), and (S-70).................................38180
213.505-70  (b)(1) amended; interim................................38242
214.201-6  Added...................................................38174
    Introductory text added; interim...............................38242
214.202-5  (b) removed.............................................38174
214.207  Amended...................................................38246
214.208  Removed...................................................38175
214.406-3  (g)(3)(iv) removed......................................38180
214.407  Removed...................................................38180
214.407-1  Removed.................................................38180
214.407-3  Removed.................................................38180
214.407-6  Removed.................................................38180
215.407  (S-70) removed; (S-71) added..............................38175

[[Page 715]]

215.410  Removed...................................................38175
215.411  Removed...................................................38175
215.411-70  Removed................................................38175
215.507  (b)(S-70) revised.........................................38203
215.603  Removed...................................................38180
215.608  (S-70) added..............................................35202
    Heading amended................................................38180
215.611  Added.....................................................32621
4(c)(S-72) amended.................................................46457
215.704  Amended...................................................50415
215.707  Removed...................................................38180
215.803  (d) removed...............................................38194
215.804-1  Added...................................................38237
215.804-2  (d)(2) removed..........................................38194
    (a)(2) removed.................................................38237
215.804-3  (c)(7) removed; (e)(3) Note amended.....................38194
    (i) amended....................................................38237
    Note following (e)(3) removed..................................38246
215.804-4  Removed.................................................38194
215.805-1  Removed.................................................38194
215.805-5  (c)(1)(S-72) added......................................38175
    (a)(1) amended; (a)(S-70) removed..............................38203
    (c)(1)(S-70)(A) revised........................................50415
215.807  Revised...................................................38237
215.808  (a)(9) added..............................................38237
215.811  Revised....................................................8907
215.811-70  Added...................................................8907
215.811-71  Added...................................................8907
215.811-72  Added...................................................8907
215.811-73--215.811-77  Added.......................................8908
215.811-78  Added...................................................8909
    (b)(8) amended.................................................46457
215.811-79  Added...................................................8910
215.873  Revised; interim..........................................11074
    Revised........................................................46457
215.875  Addition confirmed........................................38175
216.203-4  (c)(3) removed..........................................38194
    (a) and (b) amended............................................46458
216.206  Removed...................................................38194
216.206-1  Removed.................................................38194
216.207  Removed...................................................38194
216.207-1  Removed.................................................38194
216.301  Removed...................................................38194
216.301-1  Removed.................................................38194
216.303  Removed...................................................38194
216.306  (b) (1) and (2) removed; (b)(3) designation removed and 
        text moved to (b) introductory text; new (b) amended; 
        (c)(S-70) amended..........................................38194
216.402-2  (S-70) revised; (S-71) removed..........................38194
216.403  (c) removed...............................................38194
216.404-1  (b) amended.............................................38194
216.404-2  (a), (b)(1)(S-71), (S-72)(i), and (c)(S-71) removed; 
        (b)(S-72) (ii) and (iii) redesignated as (b)(S-72) (i) and 
        (ii).......................................................38194
216.501  (d) amended...............................................38194
216.502  Revised...................................................38200
216.503  Revised...................................................38200
216.601  Removed...................................................38194
216.603-2  (c) amended.............................................38195
216.603-3  Addition confirmed......................................38200
216.702  (b) and (b) (S-71) through (S-74) removed; (b)(3) and 
        (b)(S-70) amended..........................................38195
216.703  (b) and (c)(S-70) removed; (c) revised; (c)(S-71) amended
                                                                   38195
    (c) amendment at 52 FR 12388 confirmed.........................38200
    (c)(S-73) and (S-74) added.....................................38246
217.103-70  Introductory text revised; (a) and (b) redesignated as 
        (g) and (h); new (a) through (f) added; interim............38242
217.200  Added; interim............................................38243
217.202  Addition confirmed........................................38200
217.204  Added.....................................................50415
217.7402  (c) addition confirmed...................................38200
217.7500--217.7504 (Subpart 217.75)  Addition confirmed............38200
217.7503  (b) (6) and (7) amended; interim.........................38243
219  Revised........................................................5116
    Revision confirmed.............................................20628
219.000  (a)(S-70) amended.........................................51560
219.102-70  Amended................................................20628
219.202-5  (b) and (c) amended.....................................20628
    (b) corrected..................................................22426
    (b) amended; (c) removed.......................................50415
219.301-70  (b) revised; interim...................................20628
219.302  (S-70) heading, (1), (2), (5) and (7) amended; (S-70)(4) 
        revised....................................................20628
    (S-70)(2) amended; interim.....................................38243
219.501  (c), (d), and (g) (S-71) and (S-73) amended...............20629
    (c) amended....................................................38175
219.502-3  (S-70)(1)(ii) amended...................................20629
219.502-70  (e)(4) amended; interim................................38243
219.502-72  (a)(3), (b)(2), and (c)(1) introductory text and (i) 
        amended....................................................20629

[[Page 716]]

219.505-70  Added..................................................20629
219.506  (b) amended........................................20629, 38243
219.508  (S-71)(1) amended.........................................20629
    (e) added......................................................50415
219.602-3  (b)(2) amended..........................................20629
219.702-70  Amended................................................20629
219.703  (a) and (b)(S-70) amended.................................20629
219.704  (a) added; (a)(S-70) amended..............................20630
219.705-4  Introductory text and (S-70) amended....................20630
219.708  (c)(1) amended............................................20630
219.7000  (a) introductory text amended............................20630
    (a)(5), (a)(6) and (b) amended; (a)(7) added; interim..........20630
    Regulation at 53 FR 20630 confirmed............................50415
219.7001  Amended; interim.........................................20630
219.7002  Text revised; interim....................................20630
    Regulation at 53 FR 20630 confirmed............................50415
220.7004  (a)(2) and (c)(2) amended................................38195
222.101-1  (S-74) amended..........................................38246
222.101-2  (S-70) removed..........................................38195
    Removed........................................................38246
222.609  Removed...................................................38195
222.804-2  (b) amended.............................................38237
222.805  (a)(2) amended............................................38237
222.1404  Removed..................................................38195
222.1406  Amended..................................................38237
222.7001--222.7004 (Subpart 222.70)  Removed.......................38195
222.7101--222.7103 (Subpart 222.71)  Removed.......................38195
222.7200  (a), (b) and (c) amended..................................6155
    (a) amended....................................................51560
223.7100--223.7105 (Subpart 223.71)  Addition interim 
        effectiveness extended to 1-1-89...........................32620
    Addition confirmed.............................................38237
223.7105  Amended..................................................38237
223.7500--223.7504 (Subpart 223.75)  Added; eff. 10-31-88..........37764
224.102  (a)(1) introductory text, (i), and (ii) removed; (2) 
        redesignated as (a)(2).....................................38180
225.102  (S-70)(2) amended.........................................38175
225.108  (d)(1)....................................................38237
225.109  (a)(S-71) and (d)(S-71) removed...........................38195
    (a)(S-70) and (d)(S-70) amended................................38246
225.302  (S-72) (2)(i) and (4)(i) amended..........................38175
225.407  (a) (1) and (2) amended...................................38246
225.603  (a)(2) revised............................................38237
225.605  (a) amended...............................................38238
225.702  Added.....................................................38180
    (S-71) added...................................................38195
225.703  (S-70) added..............................................38180
225.704  Added.....................................................38180
225.7000  Amended..................................................38203
225.7001  Amended..................................................38246
225.7002  (a)(7) amended...........................................38175
    (c)(6) revised.................................................38247
225.7004  Revised..................................................38201
225.7008  Revised..................................................38247
225.7009  Added....................................................38203
225.7010  Added....................................................38203
225.7011  Added.....................................................9118
    (d) corrected..................................................10250
225.7304  (c)(1)(i)(C) amended.....................................51560
225.7305  (f) amended..............................................38247
225.7310  (a) amended..............................................38175
    (b)(4) amended.................................................38247
225.7401  Amended..................................................38203
225.7405  Revised..................................................38203
225.7501  Amended..................................................38205
225.7601  Amended..................................................50415
225.7607  Removed..................................................50416
225.7900--225.7906 (Subpart 225.79)  Added.........................38180
226.7001--226.7010 (Subpart 226.70)  Added; interim.................5126
    Addition confirmed.............................................20630
226.7002  Amended..................................................20630
226.7003  Amended..................................................20630
226.7004  (a) (1) and (3) amended..................................20630
226.7006  Existing text designated as (a) and amended; (b) added 
                                                                   20630
226.7009  Revised..................................................20630
227  Technical correction..........................................44975
227.470--227.481 (Subpart 227.4)  Revised; interim.................10781
    Revision confirmed.............................................38234
227.470--227.481-2 (Subpart 227.4)  Revised; interim...............43699
227.471  Corrected.................................................50416
227.472-1  (a) corrected...........................................50416
227.472-3  Introductory text and (a)(1)(iv) corrected..............50416
227.473-2  (b)(3) added............................................51560
227.475-2  (b) corrected...........................................50416
227.475-3  Corrected...............................................50416

[[Page 717]]

227.481  Correctly revised; interim................................20632
    Amendatory instruction corrected...............................22609
    Revision confirmed.............................................38234
227.481-1  Correctly added; interim................................20632
    Amendatory instruction corrected...............................22609
    Addition confirmed.............................................38234
227.481-2  Correctly added; interim................................20633
    Amendatory instruction corrected...............................22609
    Addition confirmed.............................................38234
    (b)(4) corrected...............................................50416
228.001  Amended...................................................38181
228.305  (e) (1) and first 2 sentences of (2) removed; last 2 
        sentences of (e)(2) designated as (e)......................38181
228.311  Removed...................................................38181
228.7000 (Subpart 228.70)  Removed.................................38181
229.202 (Subpart 229.2)  Removed...................................38175
230.401 (Subpart 230.4)  Redesignated as 230.601 (Subpart 230.6) 
                                                                   38247
230.601 (Subpart 230.6)  Redesignated from 230.401 (subpart 230.4)
                                                                   38247
231.105  Removed...................................................38181
231.205-1  Added; interim..........................................51561
231.205-38  Revised................................................51561
231.7001 (Subpart 231.70)  Addition at 52 FR 5771 confirmed........38238
231.7001  (a), (b), (c) (1) and (2) (i), (ii) introductory text, 
        (A) and (B) revised........................................38238
232.103  Revised; interim..........................................35511
    Addition at 52 FR 30369 confirmed..............................38186
232.111  (a) through (d) and (S-70) removed.........................3752
    (S-71) and (S-72) amended; interim.............................35511
    (S-71) and (S-72) additions at 52 FR 30369 confirmed...........38186
232.170-3  Introductory text and (b) amended.......................38186
232.171  Amended...................................................38186
232.501-1  (a) revised; interim....................................35512
    Revised........................................................38186
232.501-2  (a) amended.............................................38186
232.502-1  (S-71), (2), (4) and (7) revised; interim...............35512
    (S-71) (1), (2), (4), and (7) amended..........................38186
232.502-2  Amended.................................................38186
232.502-4  (S-71) revised; (S-72) through (S-74) added; interim....35512
232.905--232.906 (Subpart 232.9)  Added.............................3752
233.213  Revised...................................................38181
233.214  Revised...................................................38181
233.270  Removed...................................................38238
234.005-70  Amended................................................38175
235.001  Amended...................................................38182
235.003  (a) amended...............................................38238
235.004  (a) introductory text and (2) revised; interim.............5127
    (a) introductory text and (2) revision confirmed...............20630
235.005  Removed...................................................38182
235.006  Removed...................................................38182
235.007  (a) introductory text and (5), (b), and (g) revised; (c) 
        removed; interim............................................5128
    ( S-70) added..................................................50416
    (a) introductory text and (5), (b), and (g) revision and (c) 
removal confirmed..................................................20630
    (b) and (g) amended; (c) and (i) removed.......................38182
235.008  Removed...................................................38182
235.010  (b) amended...............................................38182
235.016  Added; interim.............................................5128
    Addition confirmed.............................................20630
    (a)(S-70) amended..............................................20630
235.071  (c) amended...............................................38182
236.201  (a)(1)(S-71) and (S-72) added; (c) revised................38175
236.402  (S-70)(1) removed; (S-70) (2) and (3) redesignated as (S-
        70) (1) and (2); new (S-70)(1)(iii) removed................38195
236.572-4  Removed.................................................38195
236.573-2  Removed.................................................38195
236.573-5  Removed.................................................38195
236.602-4  (c) amended.............................................38195
236.606  (S-70) removed............................................38195
236.7100--236.7101-5 (Subpart 236.71)  Removed.....................38196
237.104  (S-70)(c) heading, (1), and (2), (d), (f), (m), and 
        (n)(3) removed; (S-70)(g)(3)(viii) and (i)(1) amended; (S-
        70) (a) through (n) and (S-71) (a) through (e) 
        redesignated as (S-70)(1) through (10).....................38196

[[Page 718]]

237.204  ( S-70) removed; (S-71) redesignated as (S-70)............50416
237.205  Revised...................................................50416
237.205-70  Removed................................................50416
237.205-71  (a) (1) through (5) removed; (a) (6) and (7) 
        redesignated as (a) (1) and (2)............................38196
    Removed........................................................50416
237.206  Added.....................................................50416
237.270  Removed...................................................50416
237.304  (S-73) removed............................................38196
237.7409  (e) amended..............................................38201
239  Heading revised...............................................38247
242.302  (S-75) added...............................................8910
    (S-37) removed; (S-74) redesignated as (S-73)..................38196
242.501  Removed...................................................38196
242.602  (a) amended...............................................38196
242.603  Revised...................................................51561
242.771  Addition confirmed and revised............................38238
242.1106  (d) added; interim.......................................38243
242.1203  (b)(1) amended....................................38176, 38196
242.1403-2  (a)(S-70) amended......................................38247
242.7100  Revised; interim.........................................38243
242.7101  Revised; interim.........................................38243
242.7300--242.7302 (Subpart 242.73)  Added.........................46458
243.104  (a) amended...............................................38196
243.204  (S-72) removed............................................38196
244.304  (b)(1)(v) amended.........................................38247
244.305-2  Removed.................................................38196
245.301  Amended...................................................50416
245.302-72  Revised................................................38176
245.306  Removed...................................................38182
245.306-2  Removed.................................................38182
245.310  Added.....................................................50416
245.310-1  Added...................................................50416
245.403  (a) removed; (b) redesignated as (S-70)...................38182
245.505-14  (a)(3)(vi) amended; (a)(3)(vii) removed................46459
    (a)(1) (iv), (v), and (vii) amended............................51561
245.603-71  Added..................................................38182
245.604  (S-70)(1) amended.........................................38247
245.606-5  (e) added...............................................38182
245.607-70  Amended................................................38182
245.607-72  (e) amended............................................38248
    (e) amended....................................................46459
245.608-1  (a) added; (b) removed..................................38182
245.608-2  Added...................................................38182
245.608-5  Added...................................................38182
245.608-70  (a), (b), (c), and (f) amended; (d) revised............38182
    (b), (c), (d), (e) and (f) amended.............................46459
245.610-1  (a) (1)(ii) and (3)(i) amended..........................38183
    (a) (1)(viii) and (2) (i) and (v) amended......................38248
    (a)(1)(viii) amended...........................................46459
245.612-3  Added...................................................51561
245.613  Removed...................................................38183
245.7101-3  Amended................................................38183
245.7101-10  Added.................................................38183
245.7102-4  (b)(2) amended.........................................38183
245.7102-7  Added..................................................38183
246.371  Removed...................................................38196
246.705  (a) amended...............................................38176
247.105  (b)(5)(i) amended.........................................38176
247.271-3  (b)(2) introductory text revised; (c) (1) and (2) 
        amended....................................................38183
247.271-4  (a)(3) and (b) (16) through (19) removed; (a)(4) 
        redesignated as (a)(3) and amended; (b) (1), (2), (4), 
        (5), (6) and (7) amended; (b) (8) through (15) revised.....38183
247.301-2  Removed.................................................38196
247.305-10  (a)(1)(i) revised; interim.............................38243
247.372  Heading revised...........................................46459
247.373  Heading and text amended..................................46459
248.201  (a)(2) introductory text, (i), and (ii) removed...........51561
249.110  (a)(2) amended............................................38248
249.7002  (d) amended..............................................38248
251.104  Removed...................................................38196
252  Technical correction..........................................44975
252.203-7001  (b) amended..........................................38184
252.203-7002  Addition confirmed and amended.......................38239
252.204-7004  Introductory text amended............................34104
252.204-7005  Revised..............................................34104
    (a) amended....................................................50417
252.204-7006  Addition confirmed...................................38176
    Removed........................................................38248
252.204-7007  Introductory text amended............................34104
    Introductory text corrected....................................50417
252.204-7008  Added................................................51561
252.205-7000  Addition confirmed; amended..........................10250
    Addition confirmed.............................................38196
    Amended........................................................38239

[[Page 719]]

252.208-7006  Added; interim.......................................29334
252.209-7000  Added................................................38196
252.209-7001  Added................................................20632
252.210-7001  Heading and text amended.............................38176
252.210-7002  Heading and text amended.............................38176
252.210-7005  Added................................................35202
252.214-7000  Removed..............................................38176
252.214-7001  Added................................................38176
252.215-7002  Addition confirmed...................................38176
252.215-7003  Added.................................................8910
    Corrected......................................................11073
252.217-7129  Removed..............................................38248
252.217-7264  Amended..............................................38248
252.219-7000  Revised; interim......................................5128
    Revision confirmed.............................................20630
    Amended........................................................20630
    Correctly designated...........................................22609
252.219-7005  Revised; interim......................................5129
    Revision confirmed.............................................20630
    Amended........................................................20631
252.219-7006  Revised; interim......................................5129
    Revision confirmed.............................................20630
    Amended........................................................20631
252.219-7007  Added; interim........................................5129
    Addition confirmed.............................................20630
    Heading and text amended.......................................20631
    Heading corrected..............................................50417
252.219-7008  Added; interim........................................5129
    Addition confirmed.............................................20630
    Removal; interim...............................................20631
    Regulation at 53 FR 20626 confirmed............................50417
252.219-7009  Added; interim........................................5130
    Addition confirmed.............................................20630
    Amended........................................................20631
    Correctly designated...........................................22426
252.219-7010  Added; interim........................................5130
    Addition confirmed.............................................20630
    Amended........................................................20631
252.219-7011  Added; interim........................................5131
    Addition confirmed.............................................20630
252.223-7001  Amended..............................................38205
252.223-7003  Addition interim effectiveness extended to 1-1-89....32620
    Addition confirmed.............................................38239
252.223-7500  Added; eff. 10-31-88.................................37765
252.225-7007  Amended..............................................38239
252.225-7010  Amended..............................................38248
252.225-7022  Added................................................38184
252.225-7023  Revised..............................................38248
252.225-7026  Added.................................................9119
    Correctly designated...........................................10250
252.225-7027  Added.................................................9119
    Correctly designated...........................................10250
252.226-7000  Added; interim........................................5131
    Addition confirmed.............................................20630
    Amended........................................................20631
252.226-7001  Added................................................20631
252.227-7013  Revised; interim.....................................10789
    Introductory text amended......................................20634
    Revision confirmed.............................................38234
    Revised; interim...............................................43709
    Regulation at 53 FR 43709 confirmed; corrected.................50417
252.227-7016--252.227-7017  Removed; interim.......................10789
    Removal confirmed..............................................38234
252.227-7018  Revised; interim.....................................10793
    Revision confirmed.............................................38234
    Revised; interim...............................................43714
    Regulation at 53 FR 43714 confirmed............................50417
252.227-7019--252.227-7024  Revised; interim.......................10794
    Revision confirmed.............................................38234
252.227-7019  Revised; interim.....................................43714
    Regulation at 53 FR 43714 confirmed............................50417
252.227-7020  Republished; interim.................................43714
    Regulation at 53 FR 43714 confirmed; corrected.................50417
252.227-7021  Revised; interim.....................................43715
    Regulation at 53 FR 43714 confirmed............................50417
252.227-7022--252.227-7024  Republished; interim...................43715
252.227-7022  Regulation at 53 FR 43715 confirmed; corrected.......50417
252.227-7023  Regulation at 53 FR 43715 confirmed..................50417
252.227-7024  Regulation at 53 FR 43715 confirmed..................50417
252.227-7025  Removed; interim.....................................10789
    Removal confirmed..............................................38234
252.227-7026--252.227-7034  Revised; interim.......................10795
    Revision confirmed.............................................38234
    Republished; interim...........................................43715
252.227-7026  Regulation at 53 FR 43715 confirmed..................50417
252.227-7027  Regulation at 53 FR 43715 confirmed..................50417
252.227-7028  Revised; interim.....................................43715
    Regulation at 53 FR 43715 confirmed; (a) corrected.............50417

[[Page 720]]

252.227-7029  Revised; interim.....................................43716
    Regulation at 53 FR 43716 confirmed............................50417
252.227-7030  Revised; interim.....................................43716
    Regulation at 53 FR 43716 confirmed............................50417
252.227-7031  Revised; interim.....................................43716
    Regulation at 53 FR 43716 confirmed............................50417
252.227-7032--252.227-7034  Republished; interim...................43716
252.227-7032  Regulation at 53 FR 43716 confirmed..................50417
252.227-7033  Regulation at 53 FR 43716 confirmed..................50417
252.227-7034  Regulation at 53 FR 43716 confirmed..................50417
252.227-7035--252.227-7037  Revised; interim.......................10796
    Revision confirmed.............................................38234
252.227-7035  Removed; interim.....................................43709
252.227-7036  Revised; interim.....................................43716
    Regulation at 53 FR 43716 confirmed............................50417
252.227-7037  Republished; interim.................................43716
    Regulation at 53 FR 43717 confirmed; corrected.................50417
252.227-7038  Added; interim.......................................10797
    Addition confirmed.............................................38234
    Removed; interim...............................................43709
252.228-7005  Removed..............................................38184
252.231-7001  Addition confirmed and amended.......................38239
252.231-7002  Addition confirmed...................................38239
    Amended........................................................38240
252.232-7000  Removed...............................................3752
252.232-7004  Revised; interim.....................................35512
    Amended........................................................38186
252.232-7005  Revised..............................................38186
252.232-7006  Revised..............................................38187
252.232-7007  Added................................................38187
252.236-7002  Amended..............................................38176
252.236-7007  Removed..............................................38197
252.236-7015  Removed..............................................38248
252.245-7000  Added................................................50417
252.246-7001  Amended..............................................38248
252.247-7100  Amended..............................................38184
252.247-7102  Removed..............................................38184
252.247-7103  Removed; new 252.247-7103 redesignated from 252.247-
        7104 and revised...........................................38184
252.247-7104  Redesignated as 252.247-7103 and revised; new 
        252.247-7104 redesignated from 252.247-7105 and revised....38184
252.247-7105  Redesignated as 252.247-7104 and revised; new 
        252.247-7105 redesignated from 252.247-7106................38184
252.247-7106  Redesignated as 252.247-7105; new 252.247-7106 
        redesignated from 252.247-7107.............................38184
252.247-7107  Redesignated as 252.247-7106; new 252.247-7107 
        redesignated from 252.247-7108.............................38184
252.247-7108  Redesignated as 252.247-7107; new 252.247-7108 
        redesignated from 252.247-7109.............................38184
252.247-7109  Redesignated as 252.247-7108; new 252.247-7109 
        redesignated from 252.247-7112 and amended.................38184
252.247-7110  Removed; new 252.247-7110 redesignated from 252.247-
        7115 and amended...........................................38184
252.247-7111  Removed..............................................38184
    Redesignated from 252.247-7116 and amended.....................38185
252.247-7112  Redesignated as 252.247-7109 and amended.............38184
    Redesignated from 252.247-7120 and amended.....................38185
252.247-7113  Removed; new 252.247-7113 redesignated from 252.247-
        7114.......................................................38184
252.247-7114  Redesignated as 252.247-7113.........................38184
    Redesignated from 252.247-7121 and revised.....................38185
252.247-7115  Redesignated as 252.247-7110 and amended.............38184
252.247-7116  Redesignated as 252.247-7111 and amended.............38185
252.247-7117  Removed..............................................38185
252.247-7118  Removed..............................................38185
252.247-7119  Removed..............................................38185
252.247-7120  Redesignated as 252.247-7112 and amended.............38185
252.247-7121  Redesignated as 252.247-7114 and revised.............38185
252.270-7003  Amended..............................................38176
252.270-7004  Amended..............................................38176
252.270-7006  Amended..............................................38201

[[Page 721]]

252.270-7101  Amended..............................................38197
252.270-7102  Amended..............................................38197
252.270-7105  Amended..............................................38197
252.270-7106  Amended..............................................38197
252.270-7114  Amended..............................................38197
252.270-7115  Amended..............................................38197
252.270-7119  Amended..............................................38197
252.270-7136  Amended..............................................38197
252.270-7202  Amended..............................................38197
252.270-7203  Amended..............................................38197
252.270-7204  Amended..............................................38197
253.105  Added.....................................................46459
253.170  Amended...................................................46459
253.270  Amended..................................................38185,
                                                            38201, 38249
253.270  Removed...................................................46459
253  Editorial Note amended.................................46459; 50417
270.306  (b) amended...............................................38197
270.322  (c)(3) amended............................................38197
270.324  Amended............................................38197, 38249
270.602  Heading and (b) revised; (a) amended; (c) and (d) added 
                                                                   50417
270.607  Heading revised; text amended.............................38197
270.1103  (a) (6) and (15) amended.................................38197
270.1401  (a) amended..............................................38197
Chapter 2  Appendixes I, N, and T amended..........................38176
    Appendix N revised.............................................38218
    Appendix A amended.............................................38197
    Appendix O removed.............................................38198
    Appendix T amended.............................................38205
    Appendixes I, N and T amended..................................38249
    Appendix T revised.............................................50417

                                  1989

48 CFR
                                                                   54 FR
                                                                    Page
Chapter 2
201.403  (b)(6) added..............................................21068
    Effective date corrected.......................................22282
    (b)(6) amended.................................................26205
201.601  Heading amended...........................................26205
201.704  Amended...................................................53616
202.101  Amended...................................................11723
    Introductory text and (a) amended..............................53616
203  Technical correction..........................................32161
203.104  Added.....................................................21068
    Effective date corrected.......................................22282
203.104-1  Added...................................................21068
    Effective date corrected.......................................22282
203.104-4  Added...................................................21068
    Effective date corrected.......................................22282
203.104-5  Added...................................................21068
    Effective date corrected.......................................22282
203.104-9  Added...................................................21068
    Effective date corrected.......................................22282
203.502-2  Added...................................................30740
203.571-1  Amended.................................................16114
203.571-3  Revised.................................................16115
203.571-6  Added...................................................16115
204.202  (c)(6) removed.............................................7427
    (c)(2) amended.................................................53616
204.203  Added.....................................................20591
204.470 (Subpart 204.4)  Removed; interim...........................7427
204.670-2  Amended; interim.........................................4246
    Comment time extended...........................................9807
    Regulation at 54 FR 4246 confirmed.............................26205
204.670-3  (b) heading amended.....................................11724
204.671-3  (d)(2) amended..........................................16115
204.671-5  (d) and (e) amended; interim.............................4246
    (e) corrected...................................................5484
    (e) amended....................................................11724
    Comment time extended...........................................9807
    Amended........................................................16115
    Regulation at 54 FR 4246 and 54 FR 5484 confirmed; (e) amended
                                                                   26205
    Amended; eff. 10-1-89..........................................28420
    (b) corrected..................................................46901
204.672-2  (a) amended; interim.....................................4247
    Comment time extended...........................................9807
    (c)(6) amended.................................................16115
    Regulation at 54 FR 4247 and 54 FR 5484 confirmed..............26205
204.672-5  (e) added; interim.......................................4247
    (e) corrected...................................................5484
    Comment time extended...........................................9807
    Amended........................................................16115
    Regulation at 54 FR 4247 confirmed.............................26205
    Amended; eff. 10-1-89..........................................28422
204.675  Added; interim.............................................4247
    Comment time extended...........................................9807
    Regulation at 54 FR 4247 confirmed.............................26205
204.675-1  Added; interim...........................................4247
    Comment time extended...........................................9807
    Regulation at 54 FR 4247 confirmed; amended....................26205
204.675-2  Added; interim...........................................4247

[[Page 722]]

    Comment time extended...........................................9807
    Regulation at 54 FR 4247 confirmed.............................26205
    Amended; eff. 10-1-89..........................................28422
204.675-3  Added; interim...........................................4247
    (b) amended.....................................................5484
    Comment time extended...........................................9807
    Regulation at 54 FR 4247 and 54 FR 5484 confirmed..............26205
    Introductory text added; eff. 10-1-89..........................28422
204.804-4  (a)(S-70) added; existing text designated as (b)........16115
204.804-5  (a)(S-70) revised; (b) amended; (b) (1) through (4) 
        redesignated as (2) through (5); new (b)(1) added; new 
        (b)(4) amended.............................................16115
    (b)(1) corrected...............................................46901
204.804-70  (a)(2) revised.........................................16116
205.101  Removed...................................................53616
205.201  ( S-70) removed...........................................53616
205.207  (e)(S-70) amended.........................................53616
205.303  (a) and (S-70) amended.....................................7427
205.470  (a) amended................................................7427
    (a) corrected..................................................46902
207  Technical correction..........................................34996
207.103  (c)(6) added..............................................11724
    (i) amended; (S-70) added......................................53616
207.105  (b)(S-70)(xi) redesignated as (b)(S-70)(xii); new (b)(S-
        70(xi) added................................................7427
    (b)(12)(iv) revised; (b)(17) added.............................11724
    (b)(12)(v) added...............................................31038
    (b)(2) removed.................................................53616
207.106  Added.....................................................20591
208  Technical correction..........................................32161
208.070  Correctly designated......................................14234
208.405-2  (S-70) amended..........................................16116
    (S-70) heading revised.........................................30740
208.470-1  Amended.................................................30740
208.705--208.705-1 (Subpart 208.7)  Added..........................30740
208.7000  Amended..................................................26205
208.7001  Amended..................................................26205
208.7002  Introductory text amended................................26205
208.7003-1  Removed................................................26205
208.7003-3  Amended................................................26205
208.7003-4  Amended................................................26205
208.7003-5  Amended................................................26205
208.7003-6  Amended................................................26205
208.7005-1  Amended................................................26205
208.7006-1  Amended................................................26205
208.7006-2  (b) and (f) amended....................................26205
208.7006-3  (b) introductory text, (1) (i), (ii), and (2), (c), 
        (2), and (d) amended.......................................26205
208.7006-4  (a) and (b) amended....................................26205
208.7006-5  Existing text designated as (a); (b) added.............21068
    Effective date corrected.......................................22282
    Existing text designated as (a) and amended; (b) added.........26205
208.7006-8  Added..................................................26206
208.7007-1  Amended................................................26206
208.7007-2  Introductory text, (a), (b), and (e) amended...........26206
208.7007-3  Amended................................................26206
208.7008-1  (b)(2), (d), and (f)(1) amended; (i) added.............26206
208.7008-2  (a) and (b) amended....................................26206
208.7008-3  Amended................................................26206
208.7008-4  Amended................................................26206
208.7008-5  (a) amended............................................26206
208.7008-6  Amended................................................26206
208.7009  Amended..................................................26206
208.7009-1  Amended................................................26206
208.7009-2  Amended................................................26206
208.7009-3  (a) (4) and (5) amended................................26206
208.7009-4  (a) amended; (b) revised...............................26206
208.7010-3  Amended................................................26206
208.7011  Amended..................................................26206
208.7012  (a), (b), (c) introductory text, (1), and (2) amended....26206
208.7013  Amended..................................................26206
208.7015  Amended..................................................26206
208.7016  (a) and (b) amended......................................26206
208.7017  Amended..................................................26206
208.7900--208.7905 (Subpart 208.79)  Regulation at 53 FR 29333 
        confirmed and revised......................................14654
208.7900  Corrected.......................................16438-T, 20592
208.7901  (c) corrected............................................20592
209  Technical correction...................................32161, 34996
209.103  Regulation at 53 FR 20632 confirmed; (S-71) revised.......53616
209.104-1  Added...................................................30740
209.305  Amended...................................................30740
211.002  Amended...................................................20592
211.005  Removed...................................................20592
212  Technical correction..........................................32161
212.204  (b) amended...............................................30740

[[Page 723]]

213  Technical correction..........................................32161
213.106  Removed...................................................53616
213.204  Amended...................................................30740
213.404  (a)(3) added..............................................16116
213.505-2  (S-70)(1) amended.......................................30740
213.505-3  Revised.................................................16116
    (b)(1) (i) and (ii) amended....................................30740
213.507  (a)(1)(ix) removed.........................................7427
214  Technical correction..........................................32161
214.270  Removed...................................................30740
215  Technical correction...................................32161, 34996
215.470  Removed...................................................30740
215.608  (a)(1) added..............................................16116
215.613  (a)(2) amended.............................................7427
    (j) amended....................................................26207
215.801  Added.....................................................16116
215.804-3  Title amended; (a)(1) redesignated as (a)(1)(ii); new 
        (a)(1)(i), (b) (1), (2), and (S-70) added..................16116
    (i) amended....................................................20592
215.804-6  (g)(3) removed..........................................31038
215.805-1  Added...................................................16116
215.805-5  (i) and (j) removed.....................................31038
215.805-70  Added..................................................16117
215.806  ( S-70)(7) amended........................................53616
215.806-2  Added...................................................31038
    Correctly removed..............................................32975
215.806-3  Added...................................................31038
    Corrected......................................................32975
215.807  (b) amended...............................................11724
215.811-70  Amended................................................30740
215.811-72  (b) amended............................................11724
215.811-76  (b)(9) amended.........................................20592
215.876  Added.....................................................11724
215.970-2  (a)(2), (3), and (6) through (9) amended................53616
216  Technical correction..........................................32161
216.201  Added......................................................7427
216.403-70  Added..................................................26207
216.502  (S-70) introductory text amended...........................7427
216.506  Added.....................................................30741
217  Technical correction..........................................32161
217.7201-1  Amended.........................................20592, 30741
217.7201-2  (b) (2) and (3) amended................................30741
217.7205  Added.....................................................7427
217.7205-1  Added...................................................7427
217.7205-2  Added...................................................7427
217.7205-3  Added...................................................7427
217.7205-4  Added...................................................7428
219  Technical correction...................................32161, 34996
219.201  (c) (3) and (9), (d)(2) (xxviii) and (xxix) added; 
        (d)(2)(xxvii) and (S-70)(1) amended........................20592
(b)(5) added.......................................................26207
    (a) amended....................................................30741
219.202-1  (S-70)(11) added........................................26207
219.501-70  Amended................................................53616
219.502-3  ( S-70)(1) amended......................................53616
219.502-72  (b)(4) and (5) amended; (b)(6) added...................53616
219.505-70  Amended................................................53616
219.508  (S-72) redesignated as (S-72)(1); (S-72)(2) added.........31038
219.670  Removed....................................................7428
219.705-6  Added...................................................26207
219.708  (c)(1) amended; (c)(2) added..............................26207
219.803  (c) (1) and (2) redesignated as (c)(S-70) (i) and (ii); 
        (c)(S-71) added............................................26207
219.1005--219.1071 (Subpart 219.10)  Added; interim.................4247
    Comment time extended...........................................9807
    Regulation at 54 FR 4247 confirmed.............................26207
219.1005  (S-70) added.............................................26207
    (b) revised....................................................30741
    ( S-70) revised................................................53616
219.1070-2  (a) amended............................................26207
219.1071  (a) and (b)(1) amended....................................5484
219.7000  (a) introductory text, (1), (6) and (7) amended; (a)(8) 
        added; interim.............................................20592
    (a) introductory text amended and last sentence designated as 
(a)(1); (a) (1) through (4), (7), and (8) redesignated as (a)(1) 
(i) through (iv), (v), and (vi); (a) (5) and (6) removed; new 
(a)(2) added.......................................................31038
219.7001  Amended..................................................31038
219.7002  Amended..................................................31038
219.7200  (a)(1)(vi) amended.......................................53616
220.7000  Existing text designated as (a); (b) added...............11724
222  Technical correction..........................................32161
222.101-1  (S-74) amended..........................................30741
222.101-3  Amended.................................................53617
222.102-2  Added...................................................30741
222.403--222.407 (Subpart 222.4)  Revised..........................30741
222.1003--222.1014 (Subpart 222.10)  Revised.......................30744
222.7200  (a) corrected.............................................2258
223  Technical correction..........................................32161
223.300  Added.....................................................30745
223.303  Removed...................................................30745

[[Page 724]]

223.7100--223.7105 (Subpart 223.71)  Removed........................7428
223.7200--223.7203 (Subpart 223.72)  Added.........................30745
223.7300--223.7301 (Subpart 223.73)  Added.........................30745
223.7401--223.7402 (Subpart 223.74)  Added.........................30746
225  Technical correction..........................................34996
225.001  Redesignated as 225.101 and amended.......................16117
225.101  Redesignated from 225.001 and amended.....................16117
225.105  ( S-73) amended...........................................53617
225.403  (c) added.................................................31039
225.603  (b) (3) and (6) redesignated as (b)(5) and (c)............16117
225.901  Added; (d) redesignated from 225.904; (c) and (ii) 
        redesignated from 225.903..................................53617
225.903--225.904 (Subpart 225.9)  Heading revised..................53617
225.903  Heading and (b) redesignated as 225.901 (c) and (ii)......53617
225.904  Redesignated as 225.901 (d)...............................53617
225.1003--225.1004 (Subpart 221.10)  Added.........................53617
225.7000--225.7008 (Subpart 225.70)  Heading revised................7428
225.7000  Amended...................................................7428
225.7001  Amended...................................................7428
225.7008  (a) and (b) revised; (d)(1) amended; (e) redesignated as 
        (f); new (e) added; interim.................................7428
    Regulation at 54 FR 7428 confirmed.............................26207
225.7011  Removed..................................................22282
225.7012  Added.....................................................7428
225.7013  Added; interim...........................................16117
    Regulation at 54 FR 16117 confirmed; (b) heading and text 
amended; (c)(1)(iii) and (2) amended; (d)(1)(ii) added.............53617
225.7104  (a)(2)(ii) amended.......................................26207
    Regulation at 53 FR 51560 confirmed............................53619
225.7304  Regulation at 53 FR 51560 confirmed......................53619
225.7306  Removed..................................................11724
225.7310  (b)(4) amended...........................................53617
225.7405  Amended..................................................53617
226  Technical correction..........................................34996
226.7003  Amended..................................................31039
226.7004  (a) amended..............................................26207
227.473-2  Regulation at 53 FR 51560 confirmed.....................20592
    Regulation at 53 FR 51560 confirmed............................53619
228.101  Added.....................................................16117
228.101-1  Added...................................................16117
228.101-3  Added...................................................16118
231.205-1  Regulation at 53 FR 51561 confirmed.....................53619
231.205-38  (c)(S-70)(i) corrected..................................2258
    Regulation at 53 FR 51561 confirmed............................53619
232.103  Regulation at 53 FR 35511 confirmed.......................26207
232.111  Regulation at 53 FR 35511 confirmed.......................26207
232.501-1  Regulation at 53 FR 35512 confirmed; (a) amended........26207
232.502-1  Regulation at 53 FR 35512 confirmed.....................26207
    ( S-71)(4) amended.............................................53619
232.502-4  Regulation at 53 FR 35512 confirmed.....................26207
232.503-15  Added..................................................20592
232.905  Revised...................................................20592
232.906  (a) amended...............................................20593
233.204  Added.....................................................26207
234.005-70  Amended.........................................11724, 26208
234.005-71  Existing text designated as (a); (b) added.............11725
235.004  (a) introductory text revised; (S-70) added...............20593
235.006  Added; interim.............................................7429
235.010  Revised...................................................53619
235.071  (c) revised...............................................11725
235.7000  Amended..................................................11725
235.7002  (a)(1) amended; (a)(3) revised...........................11725
235.7003  Heading, introductory text, and (g) amended..............11725
235.7004  (a) revised; (c) through (h) redesignated as (d) through 
        (i); new (c) added; new (d) and (e) amended................11725
235.7008  (a) and (e) amended......................................11725
235.7010  Added....................................................11725
235.7100--235.7104 (Subpart 235.71)  Removed.......................11725
236  Technical correction..........................................32161
236.201  (a)(1)(S-70) and (c) (1) and (2) revised; (a)(1)(S-72) 
        redesignated as (a)(1)(S-71)...............................30746

[[Page 725]]

236.206  Amended...................................................30746
236.272  Amended...................................................30746
236.402  (S-70) heading revised; (S-70)(1) heading and (S-70)(2) 
        removed; (S)(70)(1) (i) and (ii) redesignated as (S-70) 
        (1) and (2)................................................30746
236.513  Added.....................................................30746
236.602-1  (S-70) amended..........................................30746
236.604  Revised...................................................30746
237  Technical correction...........................................7427
242  Technical correction..........................................32161
242.302  (S-76) added..............................................20593
242.7004  (b)(1) amended...........................................53619
242.7006  (b) heading revised; (b) introductory text designated as 
        (b)(1); (b)(1) through (3) and concluding text 
        redesignated as (b)(1)(i) through (iii) and (2); new 
        (b)(3) added...............................................53619
242.7201--242.7209 (Subpart 242.72)  Added.........................20593
242.7204  (c) amended..............................................30747
244.301  Existing text designated as (a); (b) added................53620
245  Technical correction..........................................32161
245.302-1  (a)(4) added............................................30747
245.407  (a) amended...............................................53620
245.505-3  Added...................................................20596
245.505-14  (a)(1)(vii) amended.....................................7429
245.607-72  (e) corrected..........................................46902
    (e) corrected..................................................46902
245.610-1  (a)(1)(viii) corrected..................................46902
247.305-70  Added..................................................26208
247.570--247.574 (Subpart 247.5)  Revised; interim.................16118
    Regulation at 54 FR 16111 comment time extended................24711
    Regulation at 54 FR 16118 confirmed............................53620
247.571  Corrected.................................................22283
    Amended........................................................53620
247.573-1  (a), (b), (b)(1) and (2) revised; (c) redesignated as 
        (e); new (c) and (d) added; new (e)(3) amended.............53620
247.573-2  (a) and (c)(3)(i)(A) corrected..........................22283
    (c)(2) amended.................................................53620
247.574  Heading, (a), and (b) amended; (c) redesignated as (d); 
        new (c) added..............................................53620
252  Technical correction...................................32161, 34996
252.203-7001  Revised..............................................16119
252.205-7000  Amended........................................7429, 46902
252.208-7006  Regulation at 53 FR 29334 confirmed and revised......14655
    Corrected....................................................16438-T
    (a) and (e)(3) corrected.......................................20596
    Introductory text amended......................................31039
252.209-7001  Regulation at 53 FR 20632 confirmed..................53616
    Revised........................................................53620
252.213-7000  Removed..............................................26208
252.213-7001  Redesignated as 252.247-7201 and amended.............26208
252.215-7003  Amended.......................................11725, 53620
252.219-7007  Amended..............................................31039
252.219-7010  Amended..............................................31039
252.219-7012  Added; interim........................................4248
    (b) redesignated as (c); new (b) added; interim.................7191
    Comment time extended...........................................9807
    Regulation at 54 FR 4248 confirmed.............................26208
252.219-7013  Added; interim........................................4248
    Comment time extended...........................................9807
    Regulation at 54 FR 4248 confirmed.............................26208
252.219-7014  Added; interim........................................4248
    Comment time extended...........................................9807
252.219-7015  Regulation at 54 FR 4248 confirmed...................26208
252.222-7000  Removed..............................................30747
252.222-7001  Removed..............................................30747
252.223-7000  Removed..............................................30747
252.223-7003  Removed...............................................7429
252.223-7004  Added................................................30747
252.223-7005  Added................................................30747
252.225-7023  Amended...............................................7429
252.225-7024  Added.................................................7429
252.225-7026  Removed..............................................22283
252.225-7027  Removed..............................................22283
252.225-7028  Added.........................................16120, 53621
252.227-7013  Amended..............................................31039
252.228-7007  Added................................................16120
252.232-7007  Amended..............................................53621
252.235-7002  Removed..............................................11725
252.235-7005  Amended........................................11725-11726
252.236-7019  Added................................................30747
252.242-7001  Added................................................20596
252.247-7200  Removed..............................................16120
252.247-7201  Redesignated from 252.213-7001 and amended...........26208
252.247-7202  Added.........................................16120, 53621
252.247-7203  Added................................................16121
    Introductory text, (a)(6), and (d) amended.....................53621
252.247-7204  Added................................................53621

[[Page 726]]

252.271-7001  Added................................................17727
    Amended........................................................31039
253  Technical correction..........................................32161
253 Editorial Note amended..................................20596, 30748
271  Added.........................................................11728
    Technical correction...........................................32161
Chapter 2  Appendix T corrected.....................................2258
    Appendix N amended..............................................7429
    Appendix H amended.............................................36773
    Appendix I amended.............................................36773
    Appendix N revised.............................................36773
    Appendix I corrected...........................................46902
    Appendix N amended.............................................53621

                                  1990

48 CFR
                                                                   55 FR
                                                                    Page
Chapter 2
201.403  (b)(2) through (6) revised................................19074
202.101  Amended...................................................19074
204.600  Added.....................................................19074
204.601  (a) and (d) amended.......................................19074
204.602  Added.....................................................19074
204.603  Added.....................................................19074
204.603-70  Added..................................................19074
204.670  Added.....................................................19074
204.670-1  Removed.................................................19074
    Redesignated from 204.670-2 and amended........................19074
204.670-2  Redesignated as 204.670-1 and amended...................19074
    Redesignated from 204.670-4 and amended........................19074
204.670-3  Removed.................................................19074
204.670-4  Redesignated as 204.670-2 and amended...................19074
204.671-1  Amended.................................................19075
204.671-2  Revised.................................................19075
204.671-3  Revised.................................................19075
204.671-4  (c) and (e) removed; (a) introductory text revised; 
        (a)(3) added; (b) and (d) redesignated as (c) and (b); 
        (a)(1), (2), new (b) introductory text and (5), and new 
        (c) amended................................................19075
204.671-5  Amended.................................................19076
204.671-6  Amended.................................................19076
204.672-1  Amended.................................................19076
204.675-2  Amended.................................................19076
204.7004-3  (a)(2)(v) amended......................................30156
204.7103-1  (b) amended............................................30156
204.7105  Revised..................................................30156
204.7105-1  Revised................................................30156
204.7105-2  Revised................................................30156
204.7105-3  Revised................................................30157
204.7106-2  (a) amended............................................30157
204.7108-3  (b) amended; interim...................................48732
205.203  Revised; interim..........................................48732
206.302-3  Removed.................................................30157
206.302-4  Added; interim..........................................19076
206.302-5  Added...................................................30157
206.304  Added; interim............................................19076
206.305  Added; interim............................................19077
208.405-1  (c) amended; interim....................................48732
208.7008-1  (a)(1) and (b)(1) amended..............................19077
208.7801--208.7803 (Subpart 208.78)  Revised; interim..............48732
209.103  (S-70) introductory text and (1) revised; interim.........48733
210.011  ( S-70) removed...........................................30157
214.202  Amended; interim..........................................48733
214.202-1  Revised; interim........................................48733
214.207  Amended; interim..........................................48733
215.401  Added; interim............................................48733
215.804-3  (b)(S-70) revised; interim..............................48733
215.805-5  (e)(6) revised; interim.................................48733
215.605  (A) added.................................................19077
215.871  (d) and (e) removed.......................................30157
216.403  (c)(S-70) removed; interim................................48733
217.401--217.401-70 (Subpart 217.4)  Added.........................19077
219.000  Amended...................................................19077
    Regulation at 55 FR 19077 confirmed............................48732
219.001  Amended; interim..........................................19077
    Regulation at 55 FR 19077 confirmed............................48732
219.201  Regulation at 55 FR 19077 confirmed.......................48732
219.201  (a) amended...............................................19077
219.301-70  (b)(2) revised; (b)(3) amended; interim................19077
    (b)(2) amended.................................................30157
    Regulation at 55 FR 19077 confirmed............................48732
219.302  ( S-70)(3) and (S-70)(4) amended; interim.................19077
    Regulation at 55 FR 19077 confirmed............................48732
219.501  (g) amended...............................................19077
    Regulation at 55 FR 19077 confirmed............................48732

[[Page 727]]

219.501-70  Amended................................................19078
    Regulation at 55 FR 19078 confirmed............................48732
219.702  (a) added; eff. 10-1-90...................................30157
219.704  (a)(1) added; (a)(3) amended..............................19078
    (a)(3) corrected...............................................39971
    (a)(3) correctly amended.......................................39971
    Regulation at 55 FR 19078 confirmed............................48732
219.705-2  Added; interim..........................................19078
    Regulation at 55 FR 19078 confirmed............................48732
219.705-4  ( S-71) added...........................................19078
    Regulation at 55 FR 19078 confirmed............................48732
219.706  (a) designation removed...................................19078
    Regulation at 55 FR 19078 confirmed............................48732
219.708  Amended...................................................19078
    (b)(1), (2), and (c)(3) added; (c)(1)(S-70) amended; eff. 10-
1-90...............................................................30157
    Regulation at 55 FR 19078 confirmed............................48732
219.803  (a) and (c)(S-71) redesignated as (c) and (b); (c) 
        amended; (c)(S-70) (i) and (ii) removed....................19078
    Regulation at 55 FR 19078 confirmed............................48732
219.804-4  Added; interim..........................................19078
    Regulation at 55 FR 19078 confirmed............................48732
219.7000  Amended..................................................19078
    Regulation at 55 FR 19078 confirmed............................48732
222.7000  (a) amended; (b) revised.................................19078
223.7401--223.7402 (Subpart 223.74)  Removed; interim..............19078
224.102  Revised...................................................30158
224.103  Revised...................................................30158
224.202  Revised...................................................30158
225.000  Revised; interim..........................................48733
225.000-70  Redesignated from 225.101; interim.....................48733
225.000-71  Added; interim.........................................48734
225.101  Redesignated as 225.000-70 and revised; interim...........48733
225.102  Revised; interim..........................................48734
225.102-70  Added; interim.........................................48734
225.103  Revised; interim..........................................48735
225.105  Revised; interim..........................................48735
225.105-70  Added; interim.........................................48735
225.107  Revised; interim..........................................48736
225.107-70  Added; interim.........................................48736
225.107-71  Added; interim.........................................48736
225.109  Revised; interim..........................................48736
225.109-70  Added; interim.........................................48736
225.302  ( S-72)(1)(ii) amended....................................19078
    (S-72)(1)(vii)(J) amended......................................30158
    (a)(S-72)(1)(viii) removed; interim............................48737
225.304  Removed; interim..........................................48737
225.401  Revised; interim..........................................48737
225.402  Revised; interim..........................................48737
225.403  (d) revised; (S-70) redesignated as 225.403-70; 
        introductory text revised; interim.........................48737
225.403-70  Redesignated from 225.403 (S-70); interim..............48737
225.405  Revised; interim..........................................48737
225.407  Revised; interim..........................................48737
225.407-70  Added; interim.........................................48738
225.407-71  Added; interim.........................................48738
225.600  Amended...................................................19078
225.600--225.605-70 (Subpart 225.6)  Revised; interim..............48738
225.603  (b)(1), (4)(i), and (5)(i) amended........................19078
225.7000  Amended..................................................19079
    Revised; interim........................................30158, 48740
225.7001  Amended; interim.........................................30158
225.7002  Introductory text and (7) revised; (a)(5), (6), (b), 
        (d)(1), and (2) amended....................................19079
225.7003  Amended..................................................19079
225.7004  Amended..................................................19079
225.7006  (a) revised; interim.....................................19079
225.7008  Removed; interim.........................................30158
225.7009  Amended..................................................19079
225.7010  Amended..................................................19079
225.7011  Added; interim...........................................48740
225.7011-1  Added; interim.........................................48740
225.7012  Amended..................................................19079
    Revised, interim...............................................30158
225.7012-1  Added; interim.........................................30158
225.7012-2  Added; interim.........................................30158
225.7012-3  Added; interim.........................................30159
    (a) amended; interim...........................................48740
225.7012-4  Added; interim.........................................30159
225.7012-5  Added; interim.........................................30159
225.7014  Added; interim...........................................48740
225.7310  (a) and (c) revised; (b)(2) through (4) amended; (d) 
        removed; interim...........................................48740
225.7314  Removed; interim.........................................48740
225.7400--225.7406 (Subpart 225.74)  Heading amended; interim......48740

[[Page 728]]

225.7400  Revised; interim.........................................48740
225.7401  Revised; interim.........................................48741
225.7402  Revised; interim.........................................48741
225.7403  Revised; interim.........................................48741
225.7404  Revised; interim.........................................48742
225.7405  Redesignated as 225.7406; new 225.7405 added; interim....48742
225.7406  Removed; new 225.7406 redesignated from 225.7405; 
        interim....................................................48742
225.7500--225.7503 (Subpart 225.75)  Removed; interim..............48742
225.7600--225.7608 (Subpart 225.76)  Removed; interim..............48742
226.7001  Amended..................................................19079
226.7003  Amended..................................................19079
226.7100--226.7103 (Subpart 226.71)  Added; interim................48742
227.303  Added.....................................................19079
231.303 (Subpart 231.3)  Added; interim............................48743
231.603 (Subpart 231.6)  Added; interim............................48743
231.703 (Subpart 231.7)  Added; interim............................48743
232.501-1  Amended.................................................19079
232.502-1  (b)(1) added; interim...................................19079
    (S-71) revised; interim........................................48743
232.502-4  ( S-75) added...........................................19079
235.006  Revised; interim..........................................48745
237.7407  (b) introductory text revised............................19080
    (b) introductory text corrected................................39971
    (b)introductory text correctly revised.........................39971
242.270  Revised; interim..........................................48745
242.302  (b)(S-70) added; interim..................................48745
244.302  (b)(2)(i) and (ii) removed; (b)(3)(i) amended.............30159
244.303  Amended...................................................19080
245.303-2  Revised.................................................19080
244.304  Removed...................................................30159
244.307  Amended...................................................30159
245.401  Amended...................................................19080
245.405  (f) amended...............................................30159
245.608-5  Heading revised; (a)(1) through (3) and (b) added; 
        interim....................................................48745
246.406  (S-71) introductory text, (1) and (2), (S-72) 
        introductory text, (1) through (4) redesignated as (S-71), 
        (i) and (ii), (2) introductory text, (i) through (iv); new 
        (S-71) introductory text added; (S-73) removed; interim....48746
246.770-2  (c) added...............................................19080
246.770-9  (a) and (b) amended.....................................19080
246.770-10  (b) added..............................................19080
247.571  Amended...................................................19080
247.573-1  (d) removed; (e) redesignated as (d)....................19080
    Correctly revised..............................................39971
    Revised........................................................39971
251.102  (e) amended...............................................19080
252.204-7004  Removed..............................................19080
    Regulation at 55 FR 19080 confirmed............................48732
252.204-7007  Amended..............................................19080
    Regulation at 55 FR 19080 confirmed............................48732
252.208-7005  Revised; interim.....................................48746
252.210-7001  Removed..............................................30159
252.215-7003  Corrected............................................39971
252.217-7306  Amended..............................................19080
    Regulation at 55 FR 19080 confirmed............................48732
252.219-7000  Amended..............................................30159
252.219-7005  Amended; interim.....................................19080
    (b) amended....................................................30159
    Regulation at 55 FR 19081 confirmed............................48732
252.219-7009  Amended..............................................19081
    Regulation at 55 FR 19081 confirmed............................48732
252.219-7015  Added................................................30159
252.219-7016  Added................................................30160
252.223-7005  Amended.......................................19081, 30160
    Regulation at 55 FR 19081 confirmed............................48732
252.223-7008  Regulation at 55 FR 19081 confirmed..................48732
252.225-7000  Revised; interim.....................................48746
252.225-7001  Revised; interim.....................................48746
252.225-7003  Introductory text amended; interim...................48747
252.225-7005  Revised; interim.....................................48747
252.225-7006  (a)(xi)(5) amended...................................30160
    Revised; interim...............................................48747
252.225-7008  Amended..............................................19081
    Revised; interim...............................................48748
252.225-7009  Revised..............................................19081
    Regulation at 55 FR 19081 confirmed............................48732

[[Page 729]]

252.225-7014  Amended..............................................19081
    Regulation at 55 FR 19081 confirmed............................48732
252.225-7018  Removed; interim.....................................48749
252.225-7020  Removed; interim.....................................48749
252.225-7021  Removed; interim.....................................48749
252.225-7023  Amended; interim.....................................30160
252.225-7025  Added; interim.......................................48749
252.225-7026  Added; interim.......................................48749
252.225-7029  Added; interim.......................................48749
252.225-7030  Added; interim.......................................48750
252.226-7002  Added; interim.......................................48750
252.227-7039  Added................................................19081
    Regulation at 55 FR 19081 confirmed............................48732
252.232-7004  Revised; interim.....................................48750
252.233-7000  Amended.......................................19082, 30160
    Regulation at 55 FR 19082 confirmed............................48732
252.243-7000  Amended..............................................19082
    Regulation at 55 FR 19082 confirmed............................48732
252.247-7203  Amended..............................................19082
    Regulation at 55 FR 19082 confirmed............................48732
252.252-7000  Removed..............................................30160
252.252-7001  Removed..............................................30160
252.252-7002  Removed..............................................30160
252.252-7003  Removed..............................................30160
Chapter 2  Appendix H removed......................................19082
    Appendix I amended.............................................19082
    Appendix L removed.............................................30160
    Appendix P removed.............................................30160
    Appendixes H and I regulation at 55 FR 19082 confirmed.........48732
    Appendix N revised; interim....................................48750

                                  1991

48 CFR
                                                                   56 FR
                                                                    Page
Chapter 2
Chapter 2  Revised; eff. 12-31-91..................................36284
202.101  (a) amended................................................9084
    Amended........................................................67212
203.104-1  Revised..................................................9084
203.104-4  Revised..................................................9084
203.104-5  Heading revised..........................................9084
203.104-9  Removed..................................................9084
203.170-2  (c) added................................................9084
203.571-1  Amended; interim.........................................9084
203.571-2  Amended; interim.........................................9084
203.571-3  (a) and (b) amended; interim.............................9084
203.571-4  Amended; interim.........................................9085
203.7100--203.7107 (Subpart 203.71)  Added; interim................24141
204.670-2  Regulation at 54 FR 4246 confirmed.......................9089
204.670-8  Revised.................................................67212
204.671-5  Regulation at 54 FR 4246 confirmed.......................9089
204.672-2  Regulation at 54 FR 4247 confirmed.......................9089
204.672-5  Regulation at 54 FR 4247 confirmed.......................9089
204.675  Regulation at 54 FR 4247 confirmed.........................9089
204.675-1  Regulation at 54 FR 4247 confirmed.......................9089
204.675-2  Regulation at 54 FR 4247 confirmed.......................9089
204.675-3  Regulation at 54 FR 4247 confirmed.......................9089
204.7000  (a) amended..............................................67212
204.7003  (a)(1)(i)(D) revised.....................................67212
204.7004-3  (a)(2) introductory text amended........................9085
204.7102  (b)(3) amended...........................................67212
204.7108-3  (b) amended.............................................9085
204.7202-2  Introductory text amended; (c)(1)(i) through (iii), 
        (2)(ii) and (vi) revised...................................67212
204.7204-2  Revised................................................67212
205.303  (a)(i) and (ii)(D)(1) and (3) revised.....................67212
209.202  (a)(1) amended............................................67212
209.403  Amended...................................................67212
209.470  (b) revised...............................................60070
211.7000--211.7005 (Subpart 211.70)  Added.........................18611
211.7005  (a)(25) revised; interim.................................67212
214.201-9  Added; interim..........................................15164
214.406-3  (e)(ii)(B) revised......................................67212
214.503-1  (a)(4) added; interim...................................15164
215.406-5  Added; interim..........................................15164
215.407  (d)(4)(S-70) and (S-71) added; interim....................15164
215.605  (e) added; interim........................................15164
    (c)(S-70) added; interim.......................................43986
    (c) added......................................................67213
215.608  (S-71) added; interim.....................................43987
    (a) added......................................................67213
215.610  Added; interim............................................15164
215.612  Added; interim............................................15164
215.811-70  (a)(3) and (c)(1)(i) amended...........................67213
217.102--217.103-1 (Subpart 217.1)  Revised.........................9085

[[Page 730]]

217.502  Revised...................................................67213
217.7404-4  Amended................................................67213
219.702  (a) amended; interim......................................15164
    Regulation at 56 FR 15164 confirmed............................60070
219.705-2  Revised.................................................60070
    Revised.........................................................6213
219.708  (b)(2) revised; interim...................................15164
    (c)(1)(S-70) amended...........................................37963
    Regulation at 56 FR 15164......................................60070
    (c)(1)(A) amended..............................................67213
219.1005--219.1071 (Subpart 219.10)  Regulation at 54 FR 4247 
        confirmed...................................................9089
219.1006  Added.....................................................9090
219.1007  Added.....................................................9090
219.1007-70  Added..................................................9090
219.1070  Removed...................................................9090
219.1070-1  Removed.................................................9090
219.1070-2  Removed.................................................9090
219.1070-3  Removed.................................................9090
219.1071  Removed...................................................9090
219.7100--219.7106 (Subpart 219.71)  Added.........................37963
    Added..........................................................67213
222.101-3  (3) amended.............................................67215
223.5  Revised; interim............................................67215
223.302  Revised...................................................67215
223.303  Revised...................................................67215
223.371  Removed...................................................67215
223.371-1  Removed.................................................67215
223.371-2  Removed.................................................67215
223.371-3  Removed.................................................67215
223.7202  (b) and (e) revised......................................60071
223.7203  Revised..................................................60071
223.7500--223.7502 (Subpart 223.75)  Revised.......................60071
225.000-70  (l) added; interim......................................9086
    Regulations at 56 FR 9086 confirmed............................60070
225.000-71  (b) table revised; interim..............................9086
    Regulation at 56 FR 9086 confirmed.............................60070
225.102  (b)(ii) introductory text revised.........................67215
225.105-70  (i) added; interim......................................9086
    Regulation at 56 FR 9086 confirmed.............................60070
225.109  (a)(S-70) amended; (d)(S-70) revised; interim..............9086
    Regulation at 56 FR 9086 confirmed.............................60070
225.302  (b)(i) revised............................................67215
225.401  Revised; interim...........................................9086
    Regulation at 56 FR 9086 confirmed.............................60070
225.402  (a)(1)(i) revised; (C) redesignated as (c); new (c) 
        introductory text revised; interim..........................9086
    Regulation at 56 FR 9086 confirmed.............................60070
225.407  Revised; interim...........................................9086
    Regulation at 56 FR 9086 confirmed.............................60070
225.501  (a) amended................................................9087
225.603-70  (c)(4)(i) revised; interim..............................9087
    (b)(7) amended.................................................15164
    Regulation at 56 FR 9087 confirmed.............................60070
225.703  Revised...................................................67215
225.872-7  Amended.................................................67215
225.1003--225.1004 (Subpart 225.10)  Removed.......................67215
225.7000  Regulation at 55 FR 30158 confirmed.......................9089
225.7001  Regulation at 55 FR 30158 confirmed.......................9089
225.7002  (c)(7) removed............................................9090
225.7008  Regulation at 55 FR 30158 confirmed.......................9089
225.7012  Regulation at 55 FR 30158 confirmed.......................9089
225.7012-1  Regulation at 55 FR 30158 confirmed.....................9089
225.7012-2  Regulation at 55 FR 30158 confirmed.....................9089
    (a), (b)(1), and (2) introductory text revised..................9090
225.7012-3  Regulation at 55 FR 30159 confirmed.....................9089
225.7012-4  Regulation at 55 FR 30159 confirmed.....................9089
225.7012-5  Regulation at 55 FR 30159 confirmed.....................9089
225.7014  Revised..................................................15164
225.7014-1  Added..................................................15164
225.7014-2  Added..................................................15164
225.7014-3  Added..................................................15164
225.7014-4  Added..................................................15164
225.7015  Added....................................................15165
225.7015-1  Added..................................................15165
225.7015-2  Added..................................................15165
225.7015-3  Added..................................................15165
225.7016  Added; interim...........................................15165
    Added..........................................................67215
225.7016-1  Added; interim.........................................15165
    Added..........................................................67215
225.7016-2  Added; interim.........................................15165

[[Page 731]]

    Added..........................................................67215
225.7016-3  Added; interim.........................................15165
    Added..........................................................67215
225.7016-4  Added..................................................67215
225.7016-5  Added..................................................67215
225.7017  Added....................................................64212
225.7017-1  Added..................................................64212
225.7017-2  Added..................................................64212
225.7017-3  Added..................................................64212
225.7017-4  Added..................................................64212
225.7017-5  Added..................................................64212
225.7101  Amended..................................................67216
225.7103  (h) added................................................67216
225.7303-2  (a)(2)(iii), (b) and (c) revised.......................67216
225.7304  (c)(1)(iii) revised; interim.............................34031
    (c)(2) and (3) revised.........................................46520
    (c)(2) corrected...............................................56116
226.7000  Revised..................................................67216
226.7001  Revised..................................................60071
226.7003  Revised..................................................60071
226.7012  Revised..................................................67216
226.7100--226.7103 (Subpart 226.71)  Regulation at 55 FR 48742 
        confirmed..................................................15167
      Removed......................................................60071
227.403-77  (a)(1)(iii)(B) revised; (a)(1)(iii)(C) added...........67216
227.7004  (c)(5) revised...........................................67216
228.311  Added......................................................9087
228.311-1  Added....................................................9087
228.311-2  Added....................................................9087
230.7103  (a)(2) amended...........................................15165
231.100  Added.....................................................15165
231.100-70  Added..................................................15165
231.201  Removed...................................................15165
231.205-1  Removed.................................................15165
231.205-18  Revised................................................46520
    Revised........................................................67217
231.205-38  Removed................................................15165
231.7003-1  (a)(2)(i) revised......................................67217
232.412  (S-72) added..............................................37965
232.412-70  (c) added..............................................67217
232.501-1  (a) amended.............................................31342
    Technical correction...........................................38174
    (a)(i) revised.................................................67217
232.501-2  Revised.................................................31342
    Technical correction...........................................38174
232.502-1  (S-71)(2)(ii)(C) removed; (S-71)(2)(ii)(D) redesignated 
        as (S-71)(2)(ii)(C); (S-71)(2)(iii) revised.................9087
    (S-71) amended.................................................31342
    Technical correction...........................................38174
    (S-71) (a)(7) and table and (b)(5) revised.....................67217
232.502-4  (S-71), (S-72) and (S-73) revised; (S-74) and (S-75) 
        removed....................................................31342
    Technical correction...........................................38174
    (b) removed....................................................67217
232.502-4-70  (b) revised; (c) added...............................67217
232.903  Added.....................................................60072
232.905-70  Added..................................................60072
233.104 (Subpart 233.1)  Added.....................................67218
233.104 (Subpart 233.104)  Added; interim..........................45832
233.104  (a)(3)(i) corrected.......................................49509
    Regulations at 56 FR 45832 and 49509 confirmed.................60070
233.211  Added.....................................................52440
233.211  Added; interim............................................67219
235.006  Revised...................................................60072
237.102  Added; interim............................................43987
    Added..........................................................67220
237.170  Added; interim............................................43987
    Added..........................................................67220
237.170-1  Added; interim..........................................43987
    Added..........................................................67220
237.170-2  Added; interim..........................................43987
    Added..........................................................67220
237.170-3  Added; interim..........................................43987
    Added..........................................................67220
237.202  Redesignated from 237.204.................................15165
237.204--237.206 (Subpart 237.2)  Heading revised..................15165
237.204  Redesignated as 237.202...................................15165
237.270  Added.....................................................15165
239.7402  (a)(3) amended...........................................67220
242.1005  Revised..................................................46521
    Revised........................................................67220
242.1006  Revised..................................................46521
    Revised........................................................67220
242.1007  Revised..................................................46521
    Revised........................................................67220
242.1008  Revised..................................................46521
242.1404-1  Added..................................................67220
243  Technical correction..........................................26719
243.107  Added; interim............................................24031
    Regulation at 56 FR 24031 eff. 5-14-91; interim................28345
      Revised......................................................60072
243.107-70  Redesignated as 243.170; new 243.170 added.............67220
243.170  Redesignated from 243.107-70..............................67220

[[Page 732]]

245.104  Amended...................................................67220
245.401  Revised....................................................9087
245.405  (c) removed; (d), (e) and (f) redesignated as (c), (d) 
        and (e); (b), new (c), new (d) and new (e) revised; 
        interim.....................................................9087
245.603-70  (1) revised.............................................9087
    (a)(1) revised.................................................67220
247.271-4  (b)(9) revised..........................................60072
249  Technical correction..........................................26719
249.102  Revised; interim..........................................24031
    Regulation at 56 FR 24031 eff. 5-14-91; interim................28345
249.102  Revised...................................................60072
    (a)(5) added...................................................67220
249.7001  (b)(5) revised...........................................67220
249.7002  Added....................................................67220
249.7003  Redesignated as 249.7004; new 249.7003 added; interim....24031
    Regulation at 56 FR 24031 eff. 5-14-91; interim................28345
    Revised........................................................60072
249.7004  Redesignated from 249.7003; interim......................24031
    Regulation at 56 FR 24031 eff. 5-14-91; interim................28345
250.103  Removed...................................................60072
250.201-70  (b)(2) revised.........................................67221
250.303  (6) revised...............................................67221
252  Technical correction..........................................26719
252.203-7001  Amended; interim......................................9087
252.203-7002  Amended...............................................9088
252.203-7004  Added; interim.......................................24142
252.208-7005  Regulation at 55 FR 48746 confirmed..................15167
252.211-7000  Added; interim.......................................18619
252.211-7001  Added; interim.......................................18619
252.211-7002  Added; interim.......................................18620
252.211-7003  Added; interim.......................................18621
252.211-7004  Added; interim.......................................18621
252.211-7005  Added; interim.......................................18622
    Removed; interim...............................................67221
252.211-7006  Added; interim.......................................18622
252.211-7007  Added; interim.......................................18622
252.211-7008  Added; interim.......................................18622
252.211-7009  Added; interim.......................................18623
252.211-7010  Added; interim.......................................18623
252.211-7011  Added; interim.......................................18623
252.211-7012  Added; interim.......................................18623
252.211-7013  Added; interim.......................................18624
252.211-7014  Added; interim.......................................18624
252.211-7015  Added; interim.......................................18624
252.211-7016  Added; interim.......................................18625
252.211-7017  Added; interim.......................................18625
252.211-7018  Added; interim.......................................18625
252.211-7019  Added; interim.......................................18626
    Amended........................................................67221
252.211-7020  Added; interim.......................................18626
252.211-7021  Added; interim.......................................18627
252.215-7004  Added; interim.......................................15166
252.219-7012  Removed...............................................9090
252.219-7013  Removed...............................................9090
252.219-7014  Removed...............................................9090
252.219-7016  Removed; interim.....................................15166
    Removal at 56 FR 15166 confirmed...............................60070
252.223-7000  Removed..............................................67221
252.223-7004  Removed; new 252.223-7004 redesignated from 252.223-
        7005; revised; interim.....................................67221
252.223-7005  Redesignated as 252.223-7004; interim................67221
252.223-7006  Added................................................60072
252.223-7007  Added................................................60073
252.223-7500  Revised..............................................60073
252.225-7000  Regulation at 55 FR 48746 confirmed..................15167
252.225-7001  Revised; interim......................................9088
    Regulation at 55 FR 48746 confirmed............................15167
    Regulation at 56 FR 9088 confirmed.............................60070
252.225-7003  Regulation at 55 FR 48747 confirmed..................15167
252.225-7005  Revised; interim......................................9088
    Regulation at 55 FR 48747 confirmed............................15167
    Regulation at 56 FR 9088 confirmed.............................60070
252.225-7006  Revised; interim......................................9089
    Regulation at 55 FR 48747 confirmed............................15167
    Regulation at 56 FR 9089 confirmed.............................60070
    (c)(1)(i) revised..............................................67221
252.225-7008  Amended; interim......................................9089
    Regulation at 55 FR 48748 confirmed............................15167
    Regulation at 56 FR 9089 confirmed.............................60070
252.225-7009  (f)(2)(iv) amended...................................67221
252.225-7014  Amended; interim......................................9089
    Regulation at 56 FR 9089 confirmed.............................60070
252.225-7018  Regulation at 55 FR 48749 confirmed..................15167
252.225-7020  Regulation at 55 FR 48749 confirmed..................15167

[[Page 733]]

252.225-7021  Regulation at 55 FR 48749 confirmed..................15167
252.225-7023  Regulation at 55 FR 30160 confirmed...................9089
252.225-7025  Revised..............................................15166
    Regulation at 55 FR 48749 confirmed............................15167
252.225-7026  Revised..............................................15166
    Regulation at 55 FR 48749 confirmed............................15167
252.225-7029  Regulation at 55 FR 48749 confirmed..................15167
    Added..........................................................67221
252.225-7030  Regulation at 55 FR 48750 confirmed..................15167
252.225-7031  Added................................................15166
252.225-7032  Added................................................15166
252.225-7033  Added; interim.......................................15166
252.225-7034  Added................................................64212
252.226-7002  Regulation at 55 FR 48750 confirmed..................15167
    Removed........................................................60073
252.228-7001  (i)(2)(ii) amended...................................67221
252.231-7000  Revised..............................................15166
252.232-7004  Regulation at 55 FR 48750 confirmed..................15167
    Added..........................................................67221
252.232-7005  Added................................................67221
252.232-7007  (a) revised..........................................31343
    Technical correction...........................................38174
252.232-7008  Added.........................................31343, 37965
    Technical correction...........................................38174
252.234-7000  Amended..............................................67222
252.237-7001  Added; interim.......................................43987
    Corrected......................................................49509
252.237-7019  Added; interim.......................................67222
252.239-7000  (a)(1) amended.......................................67222
252.247-7110  Revised..............................................60073
252.249-7001  Added; interim.......................................24031
    Regulation at 56 FR 24031 eff. 5-14-91; interim................28345
    Revised........................................................60074
    Added..........................................................67222
253.204-70  (c)(3), (d)(5)(i)(H) and (xi)(B)(1) amended; 
        (c)(4)(vi) revised.........................................67222
    (c)(4)(vii) and (e)(3)(ii) revised.............................67223
Chapter 2  Appendix N amended.......................................9089
    Appendix N regulation at 55 FR 48750 confirmed.................15167
    Appendix G amended.............................................67223

                                  1992

48 CFR
                                                                   57 FR
                                                                    Page
Chapter 2
Chapter 2  CFR correction..........................................13048
201.603-2  Added...................................................14990
202  Technical correction..........................................45422
202.101  Amended...................................................42629
203.7100--203.7108 (Subpart 203.71)  Added.........................14990
204  Technical correction..........................................45422
204.402  Revised; interim..........................................14992
    Regulation at 57 FR 14992 confirmed............................42629
204.404-70  Revised................................................14992
204.670-2  (c) redesignated as (d); new (c) added..................53598
204.670-5  (d) amended.............................................42629
204.7202-1  (c)(1), (4) and (5) amended............................53598
204.7202-2  Revised................................................42629
204.7203  (d) amended..............................................53598
204.7204-1  (a)(4) and (b) amended.................................53598
206.302-1  (a)(2)(i) introductory text revised.....................14992
206.302-5  (c)(ii) amended.........................................14992
206.302-5  (b) added...............................................53598
208  Technical correction..........................................45422
208.7203  (b) amended..............................................42629
209.406-1  Revised.................................................14992
209.406-4  Removed.................................................14992
210  Technical correction..........................................45422
210.002  (c) redesignated as (e)...................................42629
211.7003-1  (b)(4) amended; interim.................................4741
211.7004-1  (l)(3)(ii) amended; (p)(2) introductory text, (i), 
        (ii) and (iii) revised; interim.............................4741
211.7004-6  (a)(3) amended; interim.................................4741
211.7005  Revised; interim..........................................4741
213.000  Added.....................................................53599
213.101 (Subpart 213.1)  Added.....................................53599
214  Technical correction..........................................45422
214.406-3  Revised.................................................42629
214.503-1  (a)(4) removed..........................................53599
215  Technical correction..........................................45422
215.605  (c)(ii)(A)(1) and (B)(2) amended..........................14992
215.804-1  Removed.................................................14992
    Added..........................................................42629
215.804-3  Introductory text removed...............................42629
215.804-3  (i)(iii) introductory text amended......................53599
215.804-8  (a) removed.............................................53599
215.870-6  (a) amended.............................................53599

[[Page 734]]

215.975  (b) table amended.........................................53599
215.7000--215.7006 (Subpart 215.70)  Added; interim................41422
215.7000--215.7006 (Subpart 215.70)  Removed.......................53599
    Reinstated.....................................................55472
216  Technical correction..........................................45422
216.501  (a)(i)(B) amended.........................................42630
217.102-3  Added...................................................53599
217.103-1  (a)(iii), (b)(ii) heading, (A), (iv)(B), (C), (D), 
        (vi)(A)(1), (B) and (vii) revised..........................14992
217.103-1  (a)(iii) revised........................................53599
219  Technical correction..........................................45422
219.508  (d) amended...............................................42630
219.703  Revised...................................................42630
219.808  Added; interim............................................38287
219.808-1  Added; interim..........................................38287
219.811  Added; interim............................................38287
219.811-1  Added; interim..........................................38287
219.811-3  Added; interim..........................................38287
219.1007  Amended..................................................42630
219.7100  Amended; interim.........................................47275
219.7102  (b) and (d) revised; interim.............................47275
219.7103-1  (a) revised; interim...................................47275
219.7104  (b) removed; (c), (d) and (e) redesignated as (b), (c) 
        and (d); new (d) introductory text revised; interim........47276
219.7107  Added; interim...........................................47276
222.7000  (a) amended..............................................14993
222.7100--222.7102 (Subpart 222.71)  added; interim................52593
223  Technical correction..........................................45422
223.301  Removed...................................................42630
223.570--223.570-4 (Subpart 223.5)  Revised; interim...............32737
223.7001--223.7002 (Subpart 223.70)  Added; interim................14993
223.7002  (a) introductory text amended; (b) introductory text 
        revised....................................................53599
225  Technical correction..........................................45422
225.102  (a)(3)(A) amended.........................................42630
225.109  (d)(iii) revised..........................................42630
225.302  (b)(ii) amended...........................................42630
225.407  (a)(2)(A) amended.........................................42630
225.770  Added; interim............................................29042
225.770-1  Added; interim..........................................29042
    Amended........................................................42630
225.770-2  Added; interim..........................................29042
225.770-2  Revised.................................................53599
225.770-3  Added; interim..........................................29042
225.770-3  Revised.................................................53599
225.770-4  Added; interim..........................................29042
225.770-4  Revised.................................................53599
225.770-5  Added...................................................53599
225.802-71  Added..................................................42630
225.870-2  (a) amended.............................................42630
225.870-4  (a) amended.............................................42630
225.872-1  (b) amended.............................................53599
225.872-4  (b) and (c) revised.....................................42630
225.873  Added.....................................................53599
225.873-1  Added...................................................53599
225.873-2  Added...................................................53599
225.873-3  Added...................................................53600
225.7002-1  (a) introductory text revised..........................14993
225.7004  Revised; interim.........................................14993
225.7004-1  (a) table amended; (b) redesignated as (c); new (b) 
        added......................................................14993
225.7004-2  Heading, (a) and (b)(2)(i) revised; (b)(3) added.......14993
225.7004-3  Revised................................................14993
225.7004-5  Revised................................................14993
225.7012-1  (a) introductory text revised..........................14994
225.7012-4  (a)(1) revised.........................................14994
225.7014-1  Revised; interim.......................................14994
    Regulation at 57 FR 14994 confirmed............................42629
225.7014-2  Revised; interim.......................................14994
    Regulation at 57 FR 14994 confirmed............................42629
225.7014-3  Revised; interim.......................................14994
    Regulation at 57 FR 14994 confirmed............................42629
225.7016  Regulation at 56 FR 67215 confirmed......................14990
225.7016-1  Regulation at 56 FR 67215 confirmed....................14990
225.7016-2  Regulation at 56 FR 67215 confirmed....................14990
225.7016-3  Regulation at 56 FR 67215 confirmed....................14990
225.7016-4  Regulation at 56 FR 67215 confirmed....................14990
225.7016-5  Regulation at 56 FR 67215 confirmed....................14990
225.7017  Added; interim...........................................14994
225.7017-1  Added; interim.........................................14994
225.7017-2  Added; interim.........................................14994
225.7017-3  Added; interim.........................................14994
225.7017-4  Added; interim.........................................14994
225.7017-4  (a) and (b) revised....................................53600
225.7303-2  (a)(2)(i)(C) revised...................................42631
    (c) introductory text revised..................................53600

[[Page 735]]

226  Technical correction..........................................45422
226.7008  (b) amended..............................................42631
227  Technical correction..........................................45422
227.304-1  Amended.................................................53600
227.402-71  (a) amended............................................42631
227.403-70  (b)(1) revised.........................................53600
228  Technical correction..........................................45422
228.102-1  Introductory text and (1) through (4) added.............42631
228.106  Added.....................................................42707
228.106-4  Added...................................................42707
228.106-4-70  Added................................................42707
228.106-6  Added...................................................42707
228.106-7  Added...................................................42707
228.370  (d) amended...............................................42631
231  Technical correction..........................................45422
231.3  Removed.....................................................42631
231.205-6  Added...................................................53600
231.205-18  (c)(1)(iii)(1) redesignated as (c)(1)(i)(C)(1); (c)(2) 
        added......................................................53600
231.603  Revised...................................................42631
231.703  Revised...................................................42632
232  Technical correction..........................................45422
232.111  Added; interim.............................................3358
232.111-70  Added; interim..........................................3358
232.173  Added; interim.............................................3359
232.173-1  Added; interim...........................................3359
    (a) amended....................................................42632
232.173-2  Added; interim...........................................3359
232.173-3  Added; interim...........................................3359
232.173-4  Added; interim...........................................3359
    (a), (c), (d) and (g)(1) amended; (e) revised..................42632
232.173-5  Added; interim...........................................3359
    Introductory text amended......................................42632
232.503-15  (d) amended............................................42632
232.970  Added.....................................................42707
232.970-1  Added...................................................42707
232.970-2  Added...................................................42708
235.002  Revised...................................................14994
235.006  (b)(1)(C)(1)(iii) revised.................................14994
235.015-71  (i)(2) amended.........................................53601
235.017  Added.....................................................14994
235.017  (a)(2) amended............................................53601
236  Technical correction..........................................45422
236.570  (b)(4) amended............................................42632
237  Technical correction..........................................45422
237.106  (2) revised...............................................14994
237.170-2  (b) amended.............................................14995
237.170-3  Amended.................................................14995
237.203-70  (a)(3) and (4) amended.................................42632
239  Technical correction..........................................45422
239.001  Revised...................................................42632
239.7411  (b)(2) and (c)(3) amended................................42632
239.7500--239.7501-2 (Subpart 239.75)  Added; interim..............14995
    Regulation at 57 FR 14995 confirmed............................42629
242  Technical correction..........................................45422
242.205  (1)(iii) revised..........................................53601
242.302  (a)(9) added; (a)(11) removed.............................53601
242.771  Added.....................................................53601
242.771-1  Added...................................................53601
242.771-2  Added...................................................53601
242.771-3  Added...................................................53601
242.1005--242.1008 (Subpart 242.10)  Removed.......................53601
242.7202  (d) revised..............................................42632
245  Technical correction..........................................45422
245.302-7  Added...................................................14995
245.310-70  Revised................................................42632
245.7002  Revised..................................................42632
245.7308  (a) amended..............................................42633
245.7308  (a) amended..............................................53601
249.402-4  Added; interim............................................534
    Removed.........................................................6076
252  Technical correction..........................................45422
252.201-7000  Amended..............................................42633
252.203-7003  Added................................................14995
252.204-7000  Amended..............................................14996
252.204-7003  Added; interim.......................................14996
    Regulation at 57 FR 14996 confirmed............................42629
252.211-7005  Removal at 56 FR 67221 confirmed.....................14990
252.211-7021  (b)(1), (2) and (3) amended; interim..................4743
252.215-7004  Added; interim.......................................41423
    Removed........................................................53601
    Reinstated.....................................................55472
252.217-7001  Amended..............................................42633
252.219-7007  Added; interim.......................................38287
252.219-7008  Added; interim.......................................47276
252.222-7001  Added; interim.......................................52594
252.223-7004  Revised; interim.....................................32737
252.223-7005  Added; interim.......................................14996
    Revised........................................................53601
252.225-7003  Amended..............................................42633
252.225-7016  Removed; interim.....................................14996
252.225-7017  Revised; interim.....................................14996
252.225-7022  Correctly designated.................................42633
252.225-7023  Amended; interim.....................................14996
    Regulation at 57 FR 14996 confirmed............................42629
252.225-7029  Regulation at 56 FR 67221 confirmed..................14989

[[Page 736]]

252.225-7030  Added; interim.......................................14996
    Revised........................................................53601
252.225-7031  Added; interim.......................................29042
252.225-7032  Added................................................53602
252.228-7003  (a)(4), (b)(2) and (e) amended.......................42633
252.228-7006  Added................................................42708
252.232-7001  Amended..............................................42633
252.232-7005  (b) revised..........................................53602
252.232-7006  Added; interim........................................3359
    Revised........................................................42633
252.237-7019  Regulation at 56 FR 67222 confirmed..................14990
    (a)(1) and (b) revised.........................................14996
    Amended........................................................42633
252.242-7001  (c) amended..........................................42633
252.243-7000  Amended..............................................42633
252.247-7022  Amended..............................................42633
252.270-7000  Removed..............................................41423
253  Technical correction..........................................45422
253.204-70  (b)(5)(ii)(A), (c)(4)(iv)(A), (B), (C) and (ix)(B)(2) 
        revised....................................................42633
253.204-71  (a)(3) added...........................................53602
270  Removed; interim..............................................41423
Chapter 2  Appendixes B, and D amended.............................42634
    Appendix G revised.............................................42634
    Appendixes F and G amended.....................................53602

                                  1993

48 CFR
                                                                   58 FR
                                                                    Page
Chapter 2
201  Technical correction..........................................32416
    Authority citation revised.....................................37868
201.603-2  Revised; interim........................................28463
202  Authority citation revised....................................37868
203  Authority citation revised....................................37868
204  Authority citation revised....................................37868
205  Authority citation revised....................................37868
206  Technical correction..........................................32416
    Authority citation revised.....................................37868
206.302-1  (a)(2)(i) introductory text revised; interim............28463
206.302-5  (c)(ii) revised; (c)(iii) added; interim................28463
207  Technical correction..........................................32416
    Authority citation revised.....................................37868
207.105  (b)(17)(A) revised; (b)(17)(B) redesignated as 
        (b)(17)(C); (b)(2)(v) and new (b)(17)(B) added; interim....28463
    (b)(15) added..................................................32061
208  Authority citation revised....................................37868
209  Technical correction..........................................32416
    Authority citation revised.....................................37868
209.101  Added; interim............................................28464
209.104-1  Revised; interim........................................28464
209.104-70  Revised; interim.......................................28464
209.106-2  (a)(iii) added; interim.................................28464
209.406-2  Added; interim..........................................28464
209.406-4  Added; interim..........................................28464
210  Authority citation revised....................................37868
210.002-71  Added..................................................32062
211  Authority citation revised....................................37868
212  Authority citation revised....................................37868
213  Authority citation revised....................................37868
214  Authority citation revised....................................37868
215  Authority citation revised....................................37868
    Technical correction....................................18448, 32416
215.605  (a) revised; (b) added; interim...........................28465
215.870  Removed...................................................32062
215.870-1  Removed.................................................32062
215.870-2  Removed.................................................32062
215.870-3  Removed.................................................32062
215.870-4  Removed.................................................32062
215.870-5  Removed.................................................32062
215.870-6  Removed.................................................32062
215.7000--215.7006 (Subpart 215.70)  Removed.......................16782
216  Authority citation revised....................................37868
217  Technical correction..........................................32416
    Authority citation revised.....................................37868
217.103-1  (a)(iii) revised; interim...............................28465
219  Authority citation revised....................................37868
219.502-1  Revised; interim........................................28465
219.502-2  Revised; interim........................................28465
219.602-1  Revised; interim........................................28465
219.602-70  Added; interim.........................................28465
219.702  (a)(i)(A)(1) revised; interim.............................28465

[[Page 737]]

    (a)(i)(A)(1) correctly designated..............................32416
219.703  (a) introductory text revised; interim....................28465
219.705-2  Revised; interim........................................28465
219.808-1  (b)(i) revised; interim.................................28465
219.1005  (a) revised; interim.....................................28466
219.1006  Revised; interim.........................................28466
219.7102  Introductory text revised; interim.......................28466
219.7106  (a)(1)(ii) amended; (c) redesignated as (d); new (c) 
        added; interim.............................................28466
222  Technical correction..........................................32416
    Authority citation revised.....................................37868
222.1308  Added; interim...........................................28466
223  Technical correction..........................................32416
    Authority citation revised.....................................37868
223.7000  Added; interim...........................................28466
223.7002  (a)(1) revised; interim..................................28466
223.7100--223.7103 (Subpart 223.71) Added; interim.................28466
224  Authority citation revised....................................37868
225  Authority citation revised....................................37868
225.702  (1) revised; interim......................................28467
225.770-1  Revised; interim........................................28467
225.901 (Subpart 225.9)  Removed; interim..........................28467
225.7002-2  (e) and (f) revised; interim...........................28467
225.7002-4  (a) and (c) introductory text revised; interim.........28467
225.7003-2  Revised; interim.......................................28467
225.7005  Removed; interim.........................................28467
225.7014-1  Revised; interim.......................................28467
225.7014-2  Revised; interim.......................................28467
225.7014-3  Revised; interim.......................................28467
225.7015-1  Revised; interim.......................................28467
225.7015-3  Revised; interim.......................................28467
225.7017-1  Revised; interim.......................................28468
225.7017-2  Revised; interim.......................................28468
225.7018  Added; interim...........................................28468
225.7018-1  Added; interim.........................................28468
225.7018-2  Added; interim.........................................28468
225.7018-3  Added; interim.........................................28468
225.7019  Added; interim...........................................28468
225.7019-1  Added; interim.........................................28468
225.7019-2  Added; interim.........................................28468
225.7019-3  Added; interim.........................................28468
    (a)(2) corrected...............................................32416
225.7019-4  Added; interim.........................................28468
225.7102  (e) removed; (f) redesignated as (e); interim............28468
225.7103  (e)(2) and (f) amended; (g) and (h) removed; interim.....28468
225.7104  Revised; interim.........................................28468
225.7200--225.7203 (Subpart 225.72)  Revised; interim..............28469
226  Authority citation revised....................................37868
227  Technical correction..........................................32416
    Authority citation revised.....................................37868
227.405-79  (b)(1) introductory text amended; interim..............28469
228  Technical correction..........................................32416
    Authority citation revised.....................................37868
228.102-1  Introductory text and (4) revised; interim..............28469
229  Authority citation revised....................................37868
230  Authority citation revised....................................37868
231  Technical correction..........................................32416
    Authority citation revised.....................................37868
231.205-6  (g)(2)(i) amended; interim..............................28469
231.205-22  Added; interim.........................................28469
231.7000--231.7002-6 (Subpart 231.70)  Revised; interim............28469
232  Authority citation revised.............................37868, 46092
232.501-1  (a)(i) revised; interim.................................62046
232.502-1-71  Table 32-1 revised; interim..........................62046
    Table corrected................................................64353
232.702--232.705-70 (Subpart 232.7) Added; interim.................46092
233  Technical correction..........................................32416
    Authority citation revised.....................................37868
233.211  Removed; interim..........................................28470
233.7000  Revised; interim.........................................28470
234  Authority citation revised....................................37868
235  Authority citation revised....................................37868
235.006  (b)(i)(C)(1)(iii) revised; interim........................28471
    (b)(i)(C)(1)(iii) correctly designated.........................32416
235.017  Revised; interim..........................................28471
236  Authority citation revised....................................37868
237  Technical correction..........................................32416
    Authority citation revised.....................................37868
237.171  Added; interim............................................28471

[[Page 738]]

237.171-1  Added; interim..........................................28471
237.171-2  Added; interim..........................................28471
237.270  Revised; interim..........................................28471
239  Authority citation revised....................................37868
239.7501-2  Revised; interim.......................................28471
    Correctly designated...........................................32416
241  Authority citation revised....................................37868
242  Authority citation revised....................................37868
243  Authority citation revised....................................37868
244  Authority citation revised....................................37868
245  Authority citation revised....................................37868
246  Authority citation revised....................................37868
247  Authority citation revised....................................37868
248  Authority citation revised....................................37868
249  Authority citation revised.............................37868, 43286
249.7003  Added; interim...........................................43286
250  Authority citation revised....................................37868
251  Authority citation revised....................................37868
252  Technical correction..........................................18448
    Authority citation amended.....................................37868
    Authority citation revised..............................43286, 46092
252.203-7001  Amended; interim.....................................28471
252.209-7001  Amended; interim.....................................28471
252.209-7002  Added; interim.......................................28471
252.215-7003  Removed..............................................32062
252.215-7004  Removed..............................................16782
252.219-7003  Amended; interim.....................................28472
252.219-7007  Amended; interim.....................................28472
    Corrected......................................................32416
252.219-7009  Added; interim.......................................28472
252.222-7001  Amended; interim.....................................28472
252.223-7005  (e) correctly added..................................40388
252.223-7006  Added; interim.......................................28472
252.225-7016  Added; interim.......................................28473
252.225-7025  Revised; interim.....................................28473
252.225-7026  Revised; interim.....................................28474
252.225-7033  Added; interim.......................................28474
252.227-7013  Amended; interim.....................................28474
252.231-7001  Revised; interim.....................................28474
252.232-7004  Amended; interim.....................................62046
252.232-7007  Added; interim.......................................46093
252.233-7000  Amended..............................................28475
252.237-7020  Added; interim.......................................28475
252.237-7021  Added; interim.......................................28475
252.249-7002  Added; interim.......................................43287
253  Technical correction..........................................32416
    Authority citation amended.....................................37868
253.303-2139  Removed; interim.....................................28475
Chapter 2  Appendix B amended; interim.............................28475
    Appendixes A through G amended.................................37868

                                  1994

48 CFR
                                                                   59 FR
                                                                    Page
Chapter 2
202.101  Amended; interim..........................................27668
204.201  Introductory text removed; (1) and (2) added; interim.....27668
204.670-6  (b)(2) amended; interim.................................27668
204.7003  (a)(1)(i)(J) amended; interim............................27668
206.302-5  (b) revised; interim....................................36089
207.105  Regulation at 58 FR 32061 confirmed.......................27667
209.101  Revised...................................................51132
    Regulation at 58 FR 28464 confirmed............................51132
209.104-1  (g)(i) heading revised; (g)(iii) added..................51131
    Regulation at 58 FR 28464 confirmed; (g)(ii)(A) revised; 
(g)(ii)(C) introductory text amended...............................51132
209.104-70  Heading and (a) revised; (c) and (d) added.............51131
    Regulation at 58 FR 28464 confirmed............................51132
209.106-2  Regulation at 58 FR 28464 confirmed..............27667, 51132
209.202  (a)(1) amended; interim...................................27668
209.402  Added; interim............................................27668
209.403  Amended; interim..........................................27668
209.406-2  Regulation at 58 FR 28464 confirmed..............27667, 51132
209.406-4  Regulation at 58 FR 28464 confirmed..............27667, 51132
    Removed; interim...............................................27669
210.001  Amended; interim..........................................27669
210.002-71  Regulation at 58 FR 32062 confirmed....................27667

[[Page 739]]

210.011-70  (d) removed; interim...................................27669
210.070  Removed; interim..........................................27669
213.000  Revised...................................................50851
213.101  Revised...................................................50851
213.404  (a) revised...............................................50851
213.505-3  Revised.................................................50851
214.406-3  (e)(i) revised; (e)(ix) added; interim..................27669
215.605  Regulation at 58 FR 28465 confirmed.......................27667
    (a) removed; (b) revised; interim..............................27669
215.804-3  (b)(3)(B)(2) revised; (b)(3)(B)(3) added; interim.......27669
215.804-6  (b)(2)(A) amended; interim..............................27669
215.807  (b) added; interim........................................27669
215.871-3  (c) amended; interim....................................27669
215.971-3  (d)(2) amended; interim.................................27669
215.975  (b) table amended; interim................................27669
216.307  Added.....................................................53116
217  Technical correction..........................................26343
217.500  Added.....................................................22760
217.502  Revised...................................................22760
217.503  Removed...................................................22760
219  Technical correction..........................................15501
219.000  Introductory text revised; interim........................27670
219.301  (a) introductory text revised; interim....................22131
219.502-1  Regulation at 58 FR 28465 confirmed.....................27667
219.502-2  Regulation at 58 FR 28465 confirmed.....................27667
219.502-2-70  (a)(1)(ii) revised; (a)(1)(iii) added; interim.......24959
    (a) introductory text and (c) revised; (d) added; interim......27670
219.504  (b) introductory text revised; interim....................12192
219.602-1  Regulation at 58 FR 28465 confirmed.....................27667
219.705-2  Regulation at 58 FR 28465 confirmed.....................27667
    Revised; interim...............................................27670
219.808-1  (b)(iv) added; interim..................................27670
219.1005  (a) revised; interim.....................................27670
219.1006  Regulation at 58 FR 28466 confirmed......................27667
219.7100--219.7105 (Subpart 219.71)  Revised; interim..............27670
222.101-3  (3) amended; interim....................................27671
222.7100--222.7102 (Subpart 222.71)  Heading revised; interim......36089
223.370-4  (b)(1)(ii) introductory text amended....................27671
223.7100--223.7103 (Subpart 223.71)  Regulation at 58 FR 28466 
        confirmed..................................................27668
225  Technical correction..........................................26343
225.9  Regulation at 58 FR 28467 confirmed.........................51132
225.000-70  (m) revised; interim....................................1289
    Regulation at 59 FR 1289 comment period extended................5335
225.000-71  (a)(2) and (c)(1) revised; interim......................1289
    Regulation at 59 FR 1289 comment period extended................5335
225.105  (3) and (5)(ii)(A) revised; interim........................1289
    Regulation at 59 FR 1289 comment period extended................5335
225.109  (a) revised; interim.......................................1289
    Regulation at 59 FR 1289 comment period extended................5335
225.302  (b)(i) amended............................................27671
225.401  Revised; interim...........................................1289
    Regulation at 59 FR 1289 comment period extended................5335
    Amended........................................................23169
225.402  (c)(i) and (ii) introductory text revised; interim.........1289
    Regulation at 59 FR 1289 comment period extended................5335
    Corrected......................................................39974
225.403  (m)(4) added..............................................23169
225.403-70  Amended; introductory text revised; interim.............1289
    Regulation at 59 FR 1289 comment period extended................5335
    Amended........................................................23169
225.407  Redesignated as 225.408; interim...........................1289
    Regulation at 59 FR 1289 comment period extended................5335
225.408  Redesignated from 225.407; (a)(1) and (2)(A) amended; 
        (a)(3) and (4) added; interim...............................1289
    Regulation at 59 FR 1289 comment period extended................5335
225.602  (3)(ii) revised; interim...................................1290
    Regulation at 59 FR 1290 comment period extended................5335

[[Page 740]]

225.603  (1)(ii)(C) added; (1)(iii)(C)(3) revised; interim..........1290
    Regulation at 59 FR 1290 comment period extended................5335
225.605-70  (c) redesignated as (d); new (c) added; interim.........1290
    Regulation at 59 FR 1290 comment period extended................5335
225.702  Revised...................................................27671
    Regulation at 58 FR 28467 confirmed............................51132
    Revised........................................................51133
225.703  Removed...................................................27671
225.704  Removed...................................................27671
225.704-70  Removed................................................27671
225.770-1  Regulation at 58 FR 28467 confirmed.....................51132
225.7002  Revised..................................................27671
225.7002-1(c)  added...............................................27671
225.7002-2  (a), (d) and (i) revised; interim......................27671
    Regulation at 58 FR 28467 confirmed............................51132
225.7002-4  Introductory text and (d) added; interim...............27671
    Regulation at 58 FR 28467 confirmed............................51132
225.7003  Removed; interim.........................................27671
225.7003-1  Removed; interim.......................................27671
225.7003-2  Removed; interim.......................................27671
    Regulation at 58 FR 28467 confirmed............................51132
225.7004  (a) amended; interim.....................................27671
225.7005  Regulation at 58 FR 28467 confirmed......................51132
225.7007  (a) amended; interim.....................................27672
225.7010  Introductory text amended; interim.......................27672
225.7011  Revised; interim.........................................27672
225.7011-1  Amended; interim.......................................27672
225.7011-2  (a) and (c) amended; interim...........................27672
225.7011-4  (b) introductory text amended; interim.................27672
225.7011-5  Amended; interim.......................................27672
225.7014  Removed..................................................10579
    Removed; interim...............................................27672
225.7014-1  Removed................................................10579
    Removed; interim...............................................27672
    Regulation at 58 FR 28467 confirmed............................51132
225.7014-2  Removed................................................10579
    Removed; interim...............................................27672
    Regulation at 58 FR 28467 confirmed............................51132
225.7014-3  Removed................................................10579
    Removed; interim...............................................27672
    Regulation at 58 FR 28467 confirmed............................51132
225.7015-1  Regulation at 58 FR 28467 confirmed....................51132
225.7015-3  Regulation at 58 FR 28467 confirmed....................51132
225.7016-1  Introductory text amended; interim.....................27672
225.7017-1  Regulation at 58 FR 28468 confirmed....................51132
225.7017-2  Regulation at 58 FR 28468 confirmed....................51132
225.7018  Regulation at 58 FR 28468 confirmed...............27668, 51132
225.7018-1  Revised; interim.......................................27672
    Regulation at 58 FR 28468 confirmed............................51132
225.7018-2  Regulation at 58 FR 28468 confirmed....................51132
225.7018-3  Revised; interim.......................................27672
225.7019  Regulation at 58 FR 28468 confirmed...............27667, 51132
225.7019-1  Regulation at 58 FR 28468 confirmed....................51132
225.7019-2  Regulation at 58 FR 28468 confirmed....................51132
225.7019-3  Regulation at 58 FR 28468 confirmed....................51132
225.7019-4  Regulation at 58 FR 28468 confirmed....................51132
225.7020  Added; interim...........................................27672
225.7020-1  Added; interim.........................................27672
225.7020-2  Added; interim.........................................27672
225.7021  Added; interim...........................................11729
225.7021-1  Corrected..............................................38931
225.7022  Added; interim...........................................19146
225.7102  Regulation at 58 FR 28468 confirmed......................51132
225.7103  Regulation at 58 FR 28468 confirmed......................51132
225.7104  Regulation at 58 FR 28468 confirmed......................51132
225.7200--225.7203 (Subpart 225.72)  Regulation at 58 FR 28469 
        confirmed..................................................51132
225.7303-2  (a) revised............................................50511
226.7000  Revised; interim.........................................27672
226.7005  (a)(1) revised; interim..................................22131
226.7100--226.7103 (Subpart 226.71)  Added; interim................12192
226.7100  Corrected................................................15501
226.7103  (c)(2) corrected.........................................15501

[[Page 741]]

226.7200 (Subpart 226.72)  Added; interim..........................36089
231  Authority citation revised....................................26144
231.100-70  Revised; interim.......................................27672
231.205-18  (c)(2) introductory text amended; interim..............27672
231.205-22  Regulation at 58 FR 28469 confirmed....................27667
231.303 (Subpart 231.3)  Added; interim............................26144
231.7000--231.7002-6 (Subpart 231.70)  Regulation at 58 FR 28469 
        confirmed..................................................27668
231.7000  Revised; interim.........................................27672
231.7001  Amended; interim.........................................27672
231.7002-1  (a)(1)(i) and (b) revised; interim.....................27673
231.7002-2  (c) redesignated as (b); new (b) introductory text 
        amended; interim...........................................27673
231.7002-3  (b)(1) amended; interim................................27673
231.7002-4  (b) amended; interim...................................27673
231.7002-5  (c)(1) amended; interim................................27673
233.104 (Subpart 233.1)  Removed; interim..........................27673
233.7000  Regulation at 58 FR 28470 confirmed......................27668
    (a) revised; interim...........................................27673
235.006  (b)(i)(C)(1) introductory text, (ii) and (iii) revised; 
        interim....................................................27673
235.015  Revised; interim..........................................27673
235.015-71  (i)(3) revised; interim................................27673
235.7000--235.7006 (Subpart 235.70)  Added.........................52443
236.602-1  (a)(i)(6)(C) added; interim.............................27673
237.171  Regulation at 58 FR 28471 confirmed.......................27667
237.171-1  Regulation at 58 FR 28471 confirmed.....................27667
237.171-2  Regulation at 58 FR 28471 confirmed.....................27667
237.7400--237.7402 (Subpart 237.74)  Added; interim................36089
242.205  (1) revised; interim......................................27673
242.705-3  Added...................................................53116
242.1203  (b)(1) amended; interim..................................27674
243.205-70  Revised; interim.......................................27674
245.310  (c)(ii)(A) amended; interim...............................27674
245.505-14  Revised; interim.......................................27674
245.607-2  Revised; interim........................................27674
247.105  (a)(iii)(A) revised; (a)(iii)(D) amended; interim.........27674
247.270-5  Revised; interim........................................50852
247.270-6  Revised; interim........................................50852
247.571  (c) redesignated as (e); new (c) and (d) added; interim 
                                                                   10580
247.573  (d) added; interim........................................10580
248.270  Amended; interim..........................................27674
249.105-1  Introductory text amended; interim......................27674
249.7001  (b)(1), (4) and (12) revised; interim....................27674
249.7003  Revised; interim.........................................27674
250.201  (b) amended; interim......................................27675
250.303  (5) and (13) amended; interim.............................27675
251.106  Removed; interim..........................................27675
252  Technical correction..........................................26343
252.203-7001  (h) amended; interim.................................27675
    Regulation at 58 FR 28471 confirmed............................51132
252.209-7001  Revised..............................................51131
    Regulation at 58 FR 28471 confirmed............................51132
252.209-7002  Regulation at 58 FR 28471 confirmed..................51132
    Amended; (a)(1), (2), (3) and (b) revised......................51133
252.209-7003  Added................................................51131
252.209-7004  Added................................................51131
252.210-7005  Removed; interim.....................................27675
252.216-7002  Added................................................53116
252.217-7026  Amended; interim.....................................27675
252.219-7000  Amended; interim.....................................22131
252.219-7001  Amended; interim.....................................24959
252.219-7002  Amended; interim.....................................24959
252.219-7003  Amended; interim..............................22131, 27675
    Regulation at 58 FR 28472 confirmed............................51132
252.219-7006  Amended; interim..............................22131, 24959
252.219-7007  Regulation at 58 FR 28472 confirmed..................51132
252.219-7008  Removed; interim.....................................27675
252.219-7009  Regulation at 58 FR 28472 confirmed...........27667, 51132
252.222-7001  Regulation at 58 FR 28472 confirmed..................51132

[[Page 742]]

252.223-7002  Amended; (a)(2)(iv) and (v) redesignated as 
        (a)(2)(v) and (vi); new (a)(2)(iv) added; (b)(1) revised; 
        interim....................................................27675
252.223-7006  Regulation at 58 FR 28472 confirmed...........27668, 51132
    Introductory text amended; interim.............................27675
252.225-7001  Amended; interim......................................1290
    Regulation at 59 FR 1290 comment period extended................5335
252.225-7006  Amended; heading revised; interim.....................1290
    Regulation at 59 FR 1290 comment period extended................5335
252.225-7007  Amended; heading revised; interim.....................1290
    Regulation at 59 FR 1290 comment period extended................5335
    (c) and (d) corrected...........................................8041
252.225-7010  Introductory text revised; interim....................1291
    Regulation at 59 FR 1291 comment period extended................5335
252.225-7011  Removed; interim.....................................27675
252.225-7012  Amended; interim.....................................27675
252.225-7015  Introductory text amended; interim...................27675
252.225-7016  Regulation at 58 FR 28473 confirmed...........27667, 51132
252.225-7018  Amended; interim.....................................27675
252.225-7023  Removed..............................................10579
    Removed; interim...............................................27675
252.225-7025  (f) amended; interim.................................27675
    Regulation at 58 FR 28473 confirmed............................51132
252.225-7026  Regulation at 58 FR 28474 confirmed..................51132
252.225-7031  Introductory text amended; interim...................27675
252.225-7033  Regulation at 58 FR 28474 confirmed...........27668, 51132
252.225-7034  Added; interim.......................................27675
252.225-7035  Added; interim........................................1291
    Regulation at 59 FR 1291 comment period extended................5335
252.225-7036  Added; interim........................................1291
    Regulation at 59 FR 1291 comment period extended................5335
252.225-7037  Added; interim........................................1292
    Regulation at 59 FR 1291 comment period extended................5335
    (f)(2)(iv) corrected............................................8041
252.225-7038  Added; interim.......................................11729
    Corrected......................................................38931
252.225-7039  Added; interim.......................................19146
    Technical correction...........................................26343
252.226-7000  Amended; interim.....................................22131
252.226-7001  Amended; interim.....................................22131
252.227-7013  Amended; interim.....................................27676
    Regulation at 58 FR 28474 confirmed............................51132
252.231-7001  Regulation at 58 FR 28474 confirmed...........27668, 51132
    Amended; interim...............................................27676
252.233-7000  Regulation at 58 FR 28475 confirmed...........27668, 51132
    Amended; interim...............................................27676
252.234-7000  Amended; interim.....................................27676
252.234-7001  Amended; interim.....................................27677
252.237-7020  Regulation at 58 FR 28475 confirmed...........27667, 51132
252.237-7021  Regulation at 58 FR 28475 confirmed...........27667, 51132
252.237-7022  Added; interim.......................................36090
252.243-7000  Revised; interim.....................................27677
252.245-7001  Added; interim.......................................27677
252.247-7025  Added; interim.......................................10580
252.248-7000  Revised; interim.....................................27677
252.249-7002  Revised; interim.....................................27677
253.204-70  (b)(12)(iii)(B) amended; interim.......................27677
253.215-70  Note amended; interim...........................27677, 27678
Chapter  2 Appendixes B and F amended; Appendix G revised; interim
                                                                   27678
    Appendix H added; interim......................................27700
    Appendix I added; interim......................................27701

                                  1995

48 CFR
                                                                   60 FR
                                                                    Page
201  Authority citation revised....................................40106
201.201-1  (d)(i) introductory text and (V) amended................61591
201.301  (b) amended...............................................61591
201.304  (1) through (5) amended...................................61591
201.402  (1) amended...............................................61591
202  Authority citation revised.............................29497, 40106
202.101  Amended............................................29497, 61591
203  Authority citation revised.............................29497, 40106
203.170-1  (a) amended.............................................61591
203.170-4  Revised.................................................61591
203.703  Amended...................................................61592

[[Page 743]]

203.502-2  (h)(ii) amended.........................................29497
203.570-5  Revised.................................................61592
203.7100--203.7108 (Subpart 203.71)  Removed.......................61592
204  Authority citation revised.............................34468, 40106
204.602-70  Added..................................................61592
204.603  Removed...................................................61592
204.603-70  Removed................................................61592
204.670-1  (c)(3) amended..........................................61592
204.670-2  (c) and (d) revised.....................................61592
204.670-6  (b) revised.............................................61592
204.7003  (a)(1)(i) revised........................................61592
204.7101  Amended..................................................34468
204.7102  (b) introductory text revised............................34468
204.7103-1  (a) introductory text amended; (a)(4) added............34468
    (a)(4)(ii)(B) corrected........................................43191
204.7104-1  (a)(3) added; (b)(1) introductory text and (i) revised
                                                                   34468
204.7104-2  (e)(5) amended; (e)(7) and (8) redesignated as (e)(8) 
        and (9); new (e)(7) added..................................34468
204.7107  Revised..................................................34469
    (e)(1) and (3) corrected.......................................43191
205  Authority citation revised....................................40106
206  Authority citation revised......................29497, 40106, 40107
206.001  Added.....................................................61592
206.102 (Subpart 206.1)  Added; interim.............................2888
    Regulation at 60 FR 2888 confirmed.............................61591
    Removed........................................................61592
206.302-5  Regulation at 59 FR 36089 confirmed.....................29496
    (c)(i)(B) amended..............................................29497
    (b)(i) revised; interim........................................40107
206.303-1  (c) added...............................................61592
206.304  (a)(4)(A)(2) and (B) revised..............................29497
207  Authority citation revised......................29497, 40106, 40107
207.102  Added.....................................................61592
207.105  (b)(2)(v) removed.........................................29497
    (b)(15), (6) and (17)(A)(8) revised............................61593
207.470  Added; interim............................................40107
208  Authority citation revised....................................40106
208.7003-1  Revised................................................61593
208.7003-2  (c) revised............................................61593
209  Authority citation revised.............................29497, 40106
209.103  (a)(i)(C) amended.........................................29497
209.103-70  Revised................................................61593
209.104-1  Regulation at 59 FR 51131 confirmed.....................29496
    (e) revised....................................................29497
209.104-70  Regulation at 59 FR 51131 confirmed....................29496
209.106-1  Revised.................................................61593
209.202  Revised...................................................61593
209.403  Amended...................................................61593
209.405-1  Added...................................................29497
    (a) and (b) redesignated as (b) and (c)........................61593
209.470  Added; interim............................................13074
209.470-1  Added; interim..........................................13074
    Amended........................................................61593
209.470-2  Added; interim..........................................13074
209.470-3  Added; interim..........................................13074
    Amended........................................................61593
210  Authority citation revised....................................40106
    Removed........................................................61593
211  Authority citation revised.............................33471, 40106
    Revised........................................................61594
211.7004-1  (h) removed; (p)(2)(ii) amended........................33471
211.7004-6  (a)(3) amended.........................................33471
211.7005  (a)(29), (b)(34) and (35) removed; (a)(30) through (33), 
        (b)(36) through (51), (52), (53) and (54) redesignated as 
        (a)(29) through (32), (b)(34) through (49), (51), (52) and 
        (53); (b)(18), (c)(6) and (10) amended; new (b)(50) added 
                                                                   33471
212  Authority citation revised....................................40106
    Revised........................................................61595
213  Authority citation revised....................................40106
214  Authority citation revised....................................40106
214.406-3  (e)(i) amended..........................................61596
215  Authority citation revised...............29497, 34468, 40106, 40107
215.406-2  Added...................................................34470
    Corrected......................................................43191
215.804-8  Revised.................................................61596
215.805-5  (a)(1)(A)(3) amended....................................61596
215.806-1  (a)(1) revised..........................................29497
215.871  Removed; interim..........................................40107
215.871-1  Removed.................................................43721
215.871-2  Removed.................................................43721

[[Page 744]]

215.871-3  Removed.................................................43721
215.871-4  Removed.................................................43721
215.871-5  Removed.................................................43721
215.971-4  (d)(3)(A) amended.......................................61596
216  Authority citation revised....................................40106
217  Authority citation revised......................29497, 34468, 40106
217.103-1  (b)(v), (vi)(A)(2) and (viii)(C) amended................61596
217.7302  (b) revised..............................................61596
217.7404-3  (a)(2) revised.........................................29498
217.7404-4  Revised................................................29498
217.7404-5  Revised................................................29498
217.7405  Revised..................................................34470
217.7406  Added....................................................34470
    Amended........................................................61596
219  Authority citation revised...............29497, 35668, 40106, 40107
219.000  Regulation at 59 FR 27670 confirmed.......................29496
219.501  S-70 stayed...............................................54955
219.502-2-70  Regulations at 59 FR 24959 and 27670 confirmed.......29496
    (a)(1)(ii) revised.............................................29498
    Stayed.........................................................54955
219.502-4  Stayed..................................................54955
219.504  Regulation at 59 FR 12192 confirmed.......................29496
    (b)(i) stayed..................................................54955
219.506  Stayed....................................................54955
219.508  (e) stayed................................................54955
219.508-70  Stayed.................................................54955
219.602-1  (a) removed; interim....................................40107
219.602-70  Removed; interim.......................................40107
    Regulation at 60 FR 40107 confirmed............................61591
219.702  (a) introductory text and (i)(A)(1) revised...............35668
219.703  (a) introductory text revised; interim....................13075
    (a) corrected..................................................41157
    Regulation at 60 FR 13075 confirmed............................61591
    (a) amended....................................................61596
219.704  Revised...................................................61596
219.705-2  Regulation at 59 FR 27670 confirmed.....................29496
219.808-1  Regulation at 59 FR 27670 confirmed.....................29496
219.1005  Regulation at 59 FR 27670 confirmed......................29496
219.1006  (b)(2) amended...........................................61596
219.7001  (b)(3) and (4) revised; (b)(5) added.....................43563
219.7100--219.7105 (Subpart 219.71)  Regulation at 59 FR 27670 
        confirmed..................................................29496
222  Authority citation revised....................................40106
222.7100--222.7102 (Subpart 222.71)  Regulation at 59 FR 36089 
        confirmed..................................................29496
222.7200 (Subpart 222.72)  Regulation at 59 FR 36089 confirmed.....29496
223  Authority citation revised....................................40106
223.104  Revised...................................................61596
223.404 (Subpart 223.4)  Added.....................................61596
223.570-4  (b)(1) revised..........................................61597
223.7101  Revised..................................................61597
223.7102  (a)(9) added; interim....................................13076
    Regulation at 60 FR 13076 confirmed............................61591
    (a)(7), (8) and (9)(ii) amended................................61597
223.7103  Revised; interim.........................................13076
    Regulation at 60 FR 13076 confirmed............................61591
224  Authority citation revised....................................40106
225  Authority citation revised...............29497, 34470, 34471, 40106
225.000-70  Regulation at 59 FR 1289 confirmed.....................29497
225.000-71  Regulation at 59 FR 1289 confirmed.....................29497
225.102  (a)(3) revised; interim...................................34470
    Regulation at 60 FR 34470 confirmed............................61591
225.105  Regulation at 59 FR 1289 confirmed........................29497
225.109  Regulation at 59 FR 1289 confirmed........................29497
225.302  (b)(i) amended............................................61597
225.401  Regulation at 59 FR 1289 confirmed........................29497
225.402  Regulation at 59 FR 1289 confirmed........................29497
225.403  (d)(1)(A), (B) introductory text and (2) amended..........61597
225.403-70  Regulation at 59 FR 1289 confirmed.....................29497
225.407  Regulation at 59 FR 1289 confirmed........................29497
225.408  Regulation at 59 FR 1289 confirmed........................29497
    (a)(4)(B) revised..............................................29498
225.602  Regulation at 59 FR 1290 confirmed........................29497

[[Page 745]]

225.603  Regulation at 59 FR 1290 confirmed........................29497
    (b)(i)(D) and (ii) amended.....................................29498
225.605-70  Regulation at 59 FR 1290 confirmed.....................29497
225.770-4  Amended.................................................61597
225.871-7  (a)(1) amended..........................................61597
225.872-1  (a) and (b) amended.....................................61597
225.872-2  (a)(2)(ii) amended......................................61597
225.872-3  (f)(4) amended..........................................61597
225.872-5  (a) amended.............................................29498
225.872-6  (b) amended.............................................29498
225.7002-2  (j) added..............................................61597
225.7004  Revised; interim.........................................19532
    Regulation at 60 FR 19532 confirmed............................61591
225.7004-1  Revised; interim.......................................19532
    Regulation at 60 FR 19532 confirmed............................61591
225.7004-2  Revised; interim.......................................19532
    (b) revised....................................................29498
    Regulation at 60 FR 19532 confirmed............................61591
225.7004-3  Revised; interim.......................................19532
    Regulation at 60 FR 19532 confirmed............................61591
225.7004-4  Revised; interim.......................................19532
    Regulation at 60 FR 19532 confirmed............................61591
    (b) revised....................................................61597
225.7004-5  Revised; interim.......................................19532
    Regulation at 60 FR 19532 confirmed............................61591
225.7004-6  Added; interim.........................................19532
    (c) added......................................................29498
    Regulation at 60 FR 19532 confirmed............................61591
225.7007  Revised; interim.........................................19532
    Regulation at 60 FR 19532 confirmed............................61591
225.7007-1  Added; interim.........................................19533
    Regulation at 60 FR 19533 confirmed............................61591
225.7007-2  Added; interim.........................................19533
    Regulation at 60 FR 19533 confirmed............................61591
225.7007-3  Added; interim.........................................19533
    Regulation at 60 FR 19533 confirmed............................61591
225.7007-4  Added; interim.........................................19533
    Regulation at 60 FR 19533 confirmed............................61591
    Revised........................................................61597
225.7010  Revised; interim.........................................19533
    Regulation at 60 FR 19533 confirmed............................61591
225.7010-1  Added; interim.........................................19533
225.7010-2  Added; interim.........................................19533
    Regulation at 60 FR 19533 confirmed............................61591
225.7010-3  Added; interim.........................................19533
    Regulation at 60 FR 19533 confirmed............................61591
    Revised........................................................61597
225.7016-1  Revised; interim.......................................19533
    Regulation at 60 FR 19533 confirmed............................61591
225.7016-2  Revised; interim.......................................19533
    Regulation at 60 FR 19533 confirmed............................61591
225.7016-3  Revised; interim.......................................19533
    Regulation at 60 FR 19533 confirmed............................61591
    Revised........................................................61597
225.7016-4  Removed; new 225.7016-4 redesignated from 225.7016-5 
        and revised; interim.......................................19534
    Regulation at 60 FR 19534 confirmed............................61591
225.7016-5  Redesignated as 225.7016-4; interim....................19534
    Regulation at 60 FR 19534 confirmed............................61591
225.7018-2  Amended................................................61597
225.7019-1  Revised; interim.......................................19534
    Regulation at 60 FR 19534 confirmed............................61591
225.7019-2  Revised; interim.......................................19534
    Regulation at 60 FR 19534 confirmed............................61591
    (b) amended....................................................61597
225.7019-3  Revised; interim.......................................19534
    Regulation at 60 FR 19534 confirmed............................61591
225.7019-4  Revised; interim.......................................19534
    Regulation at 60 FR 19534 confirmed............................61591
225.7021  Regulation at 59 FR 11729 confirmed......................29497
225.7021-1  Revised................................................29498
225.7021-3  Revised................................................29498
225.7022  Regulation at 59 FR 19146 confirmed......................29497
225.7022-1  Revised................................................29498
225.7023  Added; interim...........................................34471
    Regulation at 60 FR 34471 confirmed............................61591
225.7023-1  Added; interim.........................................34471
    Regulation at 60 FR 34471 confirmed............................61591
    Amended........................................................61597
225.7023-2  Added; interim.........................................34471

[[Page 746]]

    Regulation at 60 FR 34471 confirmed............................61591
225.7023-3  Added; interim.........................................34471
    Regulation at 60 FR 34471 confirmed............................61591
    Amended........................................................61597
225.7103  (a) and (c) introductory text amended....................61597
225.7200--225.7203 (Subpart 225.72)  Regulation at 59 FR 28469 
        confirmed..................................................29497
225.7201  Revised..................................................61597
225.7202  Amended..................................................29499
225.7307-1  (f) amended............................................61597
225.7307-2  (b) amended............................................61597
226  Authority citation revised.............................29497, 40106
226.103 (Subpart 226.1)  Added.....................................61597
226.7000  Regulation at 59 FR 27672 confirmed......................29496
226.7100--226.7103 (Subpart 226.71)  Regulation at 59 FR 12192 
        confirmed..................................................29496
226.7100  Revised; interim..........................................5870
    Regulation at 60 FR 5870 confirmed.............................61591
226.7101  Revised..................................................29499
226.7103  Revised..................................................29499
226.7104  Added; interim............................................5870
    Regulation at 60 FR 5870 confirmed.............................61591
    Revised........................................................61598
226.7200  (a) amended..............................................29499
    Regulation at 59 FR 36089 confirmed............................29497
227  Authority citation revised.............................33471, 40106
227.400 (Subpart 227.4)  Revised...................................33471
227.7100--227.7108 (Subpart 227.71)  Added.........................33471
227.7101  (b) removed; (c) redesignated as (b).....................61598
227.7102-3  (a), (b) and (c) amended...............................61598
227.7103-6  (b)(2) corrected.......................................41157
    (a) amended....................................................61598
227.7103-15  (c) introductory text revised.........................61598
227.7104  Heading and (a) amended..................................61598
227.7200--227.7207 (Subpart 227.72)  Added.........................33482
227.7202-2  Removed................................................61598
228  Authority citation revised.............................29497, 40106
228.102-1  Introductory text revised...............................29499
228.171  Added; interim............................................45377
    (e) amended....................................................61598
228.171-1  Added; interim..........................................45377
228.171-2  Added; interim..........................................45377
228.171-3  Added; interim..........................................45377
229  Authority citation revised....................................40106
230  Authority citation revised....................................40106
231  Authority citation revised.............................29497, 40106
231.205-6  (a)(2) added; interim....................................2331
    Regulation at 60 FR 2331 confirmed.............................61591
    (g)(2)(i) removed..............................................61598
231.205-70  Added; interim..........................................1748
    (b)(4) amended.................................................29499
231.301  Regulation at 60 FR 2331 confirmed........................61591
231.303  (3) added..................................................2331
    Regulation at 59 FR 26144 confirmed............................29496
231.603  Introductory text, (1) through (10), (11) introductory 
        text, (i), (ii) and (12) through (15) redesignated as (1) 
        introductory text, (i) through (x), (xi) introductory 
        text, (xi)(A), (B) and (xii) through (xv); new (2) added; 
        interim.....................................................2331
    Regulation at 60 FR 2331 confirmed.............................61591
    Revised........................................................61598
231.703  Revised....................................................2331
    (1) amended....................................................29499
    Regulation at 60 FR 2331 confirmed.............................61591
    Revised........................................................61598
231.7000--231.7002-6 (Subpart 231.70)  Removed.....................61598
232  Authority citation revised.............................29497, 40106
232.108  (1)(i) amended............................................29499
232.170  (a) and (b) amended.......................................61598
232.171  (a)(1), (b)(1) and (3) amended............................61598
232.173-1  (b) amended.............................................61598
232.173-5  Introductory text amended...............................61598
232.501-2  (a) amended.............................................61598
232.503-6  (b) added...............................................29499
232.617  Amended...................................................61598
233  Authority citation revised....................................40106

[[Page 747]]

234  Authority citation revised....................................40106
234.001  Added.....................................................61598
235  Authority citation revised.......................4570, 29497, 40106
235.001  Revised...................................................29499
235.006  (a) and (b)(iv) added; interim.............................4570
    (b)(i)(C)(1)(iii) revised......................................29500
    Regulation at 60 FR 4570 confirmed.............................61591
235.010  Revised...................................................29500
235.015-70  (d)(3)(ii) amended.....................................29500
235.015-71  (i)(2) amended.........................................61598
235.017-1  Added; interim...................................13077, 29500
    Correctly removed..............................................40107
    Regulation at 60 FR 13077 confirmed............................61591
    Revised........................................................61598
235.071  (c) and (d) added.........................................29500
235.7002  (a)(2) revised...........................................15690
    (a)(1) and (2) amended.........................................61598
235.7003  (d)(9) added.............................................15690
    (b)(1) revised.................................................61599
235.7004-1  (b) amended............................................15690
235.7004-2  (b) amended............................................15690
235.7004-3  (c) amended............................................15690
235.7006  (a) and Exhibit amended; (c) redesignated as (d); new 
        (c) added..................................................15690
    Amended........................................................61599
236  Authority citation revised....................................40106
237  Authority citation revised.............................29497, 40106
237.102-70  Added..................................................61599
237.104  (b)(ii) revised; interim...................................2888
    Regulation at 60 FR 2888 confirmed.............................61591
    (b)(ii) introductory text and (B)..............................61599
237.109  Added.....................................................61599
237.171  Removed...................................................61599
237.171-1  Removed.................................................61599
237.171-2  Removed.................................................61599
237.270  Removed...................................................61599
237.270-1  Removed.................................................61599
237.270-2  Removed.................................................61599
237.270-3  Removed.................................................61599
237.270-4  Removed.................................................61599
237.7204  Amended..................................................61599
237.7302  Amended..................................................29500
239.7303  (b) revised..............................................61599
237.7400--237.7402 (Subpart 237.74)  Regulation at 59 FR 36089 
        confirmed..................................................29496
237.7400  Amended..................................................29500
237.7401  (c) amended; (d) added...................................29500
237.7402  Amended..................................................29500
239  Authority citation revised....................................40106
241  Authority citation revised....................................40106
242  Authority citation revised.............................29497, 40106
242.302  (a)(7) added..............................................29500
242.705-1  (b)(3) and (4) removed..................................61599
242.705-2  (b)(2)(ii) and (iv) amended.............................61599
242.770  Removed...................................................61599
242.770-1  Removed.................................................61599
242.770-2  Removed.................................................61599
242.770-3  Removed.................................................61599
242.770-4  Removed.................................................61599
242.770-5  Removed.................................................61599
242.770-6  Removed.................................................61599
242.771-3  (b)(2) and (c) amended..................................61599
242.1104  Revised..................................................29500
242.1202  Added; interim............................................1749
242.1204  Added; interim............................................1749
242.7003-1  Revised................................................61599
242.7206  Introductory text revised................................61599
242.7302  (a) revised; (d) added...................................29500
242.7500--242.7503 (Subpart 242.75)  Added.........................29500
243  Authority citation revised.............................34468, 40106
243.171  Added.....................................................34470
244  Authority citation revised.............................29497, 40106
244.202--244.202-2 (Subpart 244.2)  Added..........................29501
245  Authority citation revised.............................29497, 40106
245.608-70  (a)(3) revised.........................................29501
246  Authority citation revised.............................33145, 40106
246.101  Amended; interim..........................................33145
    Regulation at 60 FR 33145 confirmed............................61591
246.102  (4) amended; interim......................................33145
    Regulation at 60 FR 33145 confirmed............................61591
246.202-3  Revised; interim........................................33145
    Regulation at 60 FR 33145 confirmed............................61591
    Redesignated as 246.202-4......................................61599

[[Page 748]]

246.202-4  Redesignated from 246.202-3; (i) and (ii) redesignated 
        as (1) and (2).............................................61599
246.204  Revised; interim..........................................33145
    Regulation at 60 FR 33145 confirmed............................61591
    Removed........................................................61599
246.704  (4) revised; interim......................................33145
246.704  Regulation at 60 FR 33145 confirmed.......................61591
    (2) and (4) amended............................................61599
246.770-1  (f)(2)(i) revised.......................................61599
247  Authority citation revised.............................29497, 40106
247.105  Regulation at 59 FR 27674 confirmed.......................29497
247.270-5  Regulation at 59 FR 50852 confirmed.....................29496
247.305-70  Revised................................................29501
247.571  (c) revised; (d) removed; (e) redesignated as (d).........29501
247.572-1  (a) revised.............................................61599
247.572-2  (a)(4) and (5) amended; (a)(6) added....................61600
247.573  (d) revised...............................................29501
248  Authority citation revised....................................40106
249  Authority citation revised.............................29497, 40106
249.7002  (b) introductory text and (2) amended....................61600
249.7003  Regulation at 59 FR 27674 confirmed......................29497
    (b)(1), (2) introductory text and (3) introductory text 
amended............................................................29501
250  Authority citation revised....................................40106
250.201-70  (b)(1) and (2) amended.................................61600
251  Authority citation revised.............................29497, 40106
251.102  (e) introductory text revised; (f) added..................29501
251.105  Added.....................................................29501
252  Authority citation revised.......29497, 33471, 34471, 35668, 40106, 
                                                                   40107
252.203-7000  Amended..............................................61600
252.203-7001  Amended..............................................61600
252.203-7003  Removed..............................................61600
252.204-7001  Introductory text amended............................61600
252.209-7000  Amended..............................................61600
252.209-7001  Regulation at 59 FR 51131 confirmed..................29496
252.209-7003  Regulation at 59 FR 51131 confirmed..................29496
252.209-7004  Regulation at 59 FR 51131 confirmed..................29496
    (b)(5) amended.................................................29502
252.209-7005  Redesignated from 252.209-7007 and amended...........61600
252.209-7007  Added; interim.......................................13074
    Redesignated as 252.209-7005...................................61600
252.210-7000  Redesignated as 252.211-7003.........................61600
252.210-7001  Redesignated as 252.211-7001.........................61600
252.210-7002  Redesignated as 252.211-7002.........................61600
252.210-7003  Redesignated as 252.211-7000.........................61600
252.210-7004  Redesignated as 252.211-7004.........................61600
252.211-7000  Removed; redesignated from 252.210-7003; 
        introductory text revised..................................61600
252.211-7001  Removed; redesignated from 252.210-7001; 
        introductory text revised..................................61600
252.211-7002  Removed; redesignated from 252.210-7002; 
        introductory text revised..................................61600
252.211-7003  Removed; new 252.211-7003 redesignated from 252.210-
        7000; introductory text revised............................61600
252.211-7004  Removed; redesignated from 252.210-7004; 
        introductory text revised..................................61600
252.211-7006  Removed..............................................61600
252.211-7007  Removed..............................................61600
252.211-7008  Removed..............................................61600
252.211-7009  Removed..............................................61600
252.211-7010  Removed..............................................61600
252.211-7011  Removed..............................................61600
252.211-7012  Removed..............................................61600
252.211-7013  Removed..............................................61600
252.211-7014  Removed..............................................61600
252.211-7015  Removed.......................................33490, 61690
252.211-7016  Removed.......................................33490, 61600
252.211-7017  Removed.......................................33490, 61600
252.211-7018  Removed..............................................61600
252.211-7019  Removed..............................................61600
252.211-7020  Removed..............................................61600
252.211-7021  Amended..............................................33490
    Removed........................................................61600
252.212-7000  Added................................................61600
252.212-7001  Added................................................61601
252.215-7001  Removed..............................................61601

[[Page 749]]

252.217-7026  Amended; heading revised.............................61601
252.219-7001  Regulation at 59 FR 24959 confirmed..................29497
    Amended........................................................29502
252.219-7002  Regulation at 59 FR 24959 confirmed..................29497
    Amended........................................................29502
    Suspended......................................................54955
252.219-7003  Regulation at 59 FR 27672 confirmed..................29496
    Amended; heading revised.......................................61601
252.219-7004  Amended..............................................35668
252.219-7005  Amended..............................................61601
252.219-7006  Regulation at 59 FR 24959 confirmed..................29497
    Amended........................................................29502
252.219-7008  Regulation at 59 FR 27672 confirmed..................29496
252.219-7009  Removed; interim.....................................40107
    Regulation at 60 FR 40107 confirmed............................61591
252.223-7006  Amended; introductory text revised...................13076
    Regulation at 60 FR 13076 confirmed............................61591
    Amended........................................................61601
252.225-7001  Regulation at 59 FR 1290 confirmed...................29497
252.225-7006  Regulation at 59 FR 1290 confirmed...................29497
252.225-7007  Regulation at 59 FR 1290 confirmed...................29497
252.225-7009  Amended..............................................29502
252.225-7010  Regulation at 59 FR 1291 confirmed...................29497
    Amended........................................................29502
252.225-7011  Added; interim.......................................34471
    Regulation at 60 FR 34471 confirmed............................61591
252.225-7012  Amended..............................................61601
252.225-7014  Amended..............................................61602
252.225-7016  Amended..............................................61602
252.225-7017  Amended; interim.....................................19534
    Regulation at 60 FR 19534 confirmed............................61591
252.225-7026  Regulation at 59 FR 28474 confirmed..................29497
    Amended.................................................29502, 61602
252.225-7029  Revised; interim.....................................19534
    Regulation at 60 FR 19534 confirmed............................61591
252.225-7035  Regulation at 59 FR 1291 confirmed...................29497
    Amended........................................................29502
252.225-7036  Regulation at 59 FR 1291 confirmed...................29497
    Amended........................................................29502
252.225-7037  Regulation at 59 FR 1292 confirmed...................29497
    Amended........................................................29503
252.225-7038  Regulation at 59 FR 11729 confirmed..................29497
252.225-7039  Regulation at 59 FR 19146 confirmed..................29497
252.225-7040  Added................................................29503
    Introductory text amended......................................61602
252.227-7013  Revised..............................................33490
    Amended........................................................61602
252.227-7014  Added................................................33493
252.227-7015  Added................................................33497
    Amended........................................................61602
252.227-7016  Added................................................33498
252.227-7017  Added................................................33498
252.227-7018  Revised..............................................33499
    Amended; heading revised.......................................61602
252.227-7019  Revised..............................................33503
252.227-7020  Revised..............................................33504
252.227-7021  Introductory text revised............................33504
252.227-7022  Introductory text revised............................33504
252.227-7023  Introductory text revised............................33505
252.227-7024  Introductory text revised............................33505
252.227-7025  Added................................................33505
252.227-7026  Introductory text revised............................33505
252.227-7027  Introductory text revised............................33505
252.227-7028  Revised..............................................33505
252.227-7029  Removed..............................................33505
252.227-7030  Introductory text revised............................33505
252.227-7031  Removed..............................................33505
252.227-7032  Introductory text revised............................33505
252.227-7033  Introductory text revised............................33505
252.227-7036  Introductory text revised............................33505
252.227-7037  Revised..............................................33505
    Amended........................................................61602
252.228-7007  Added; interim.......................................45377
252.231-7001  Removed..............................................61602
252.235-7010  Added................................................29503
252.235-7011  Added................................................29503
252.237-7020  Removed..............................................61602
252.237-7021  Removed..............................................61602

[[Page 750]]

252.237-7022  Regulation at 59 FR 36090 confirmed..................29496
    Amended........................................................29503
252.239-7010  Amended..............................................61602
252.242-7001  Removed..............................................61602
252.247-7021  Revised..............................................29503
252.247-7023  Amended..............................................61602
252.247-7024  Amended..............................................61603
252.247-7025  Revised..............................................29503
252.249-7002  Regulation at 59 FR 27677 confirmed..................29497
    Amended........................................................29503
252.251-7000  Amended..............................................29503
253  Authority citation revised......................29497, 35868, 40106
253.204-70  (b)(13)(iv), (ix), (c)(4)(viii) and (d)(5)(iv)(A)(2) 
        revised; (c)(4)(iii)(A)(6) added; (d)(5)(iv)(A)(7) removed
                                                                   35868
    Revised........................................................61603
253.204-71  (e)(2)(i)(A)(3) revised................................35869
    Revised........................................................61612
253.209-1  (a)(i)(E) revised.......................................29504
253.215-70  Amended................................................29504
Chapter  2 Appendix C amended...............................29497, 29504
    Appendixes A through I amended.................................40106
    Appendixes C, F and G amended..................................61615
    Appendix G amended........................61620, 61623, 61626, 61627

                                  1996

48 CFR
                                                                   61 FR
                                                                    Page
201.201-1  (d)(i) introductory text and (III) revised..............50451
201.402  (2) revised...............................................50451
202.101  Amended.............................................7741, 50451
204.202  (1)(iii) and (iv) amended; (1)(v) added....................7742
204.670-1  (c) revised.............................................51030
204.670-2  (d) introductory text, (1) and (7)(iii) revised.........51030
204.670-3  (a)(1), (2) introductory text, (5) and (b)(2) revised; 
        (b)(1) amended.............................................51030
204.670-5  Revised.................................................51030
204.670-6  Heading, (b)(1)(iii), (iv), (v), (2) and (c)(1) revised
                                                                   51031
204.670-8  Revised.................................................51031
204.670-9  Heading and (b) revised.................................51031
204.7003  (a)(1)(i)(F) amended.....................................50451
204.7201  (b) revised..............................................51031
204.7202-1  (a) amended............................................51031
204.7202-2  Heading, (a) introductory text, (b)(1) introductory 
        text, (i), (ii) and (2)(vi) revised........................51031
204.7203  (a) and (b) revised; (e) removed.........................51031
204.7204-1  (b) amended............................................51031
204.7204-2  Heading revised........................................51031
204.7206  Introductory text revised................................51032
206.304  Revised...................................................10285
    (a)(4)(B)(2) revised...........................................50451
207.103  (h)(i)(B) amended.........................................50451
207.104  Added.....................................................50451
207.105  Introductory text revised; (b)(12), (15) and (17) 
        redesignated as (b)(13), (16) and (18); (a)(8), new 
        (b)(13)(iv), new (16) and new (18)(A)(1)(ii) amended; 
        (b)(18)(D) added...........................................50451
207.470  Revised; interim..........................................16879
    Regulation at 61 FR 16879 confirmed............................50450
    (b) revised....................................................50452
209.103  (c) added.................................................50452
209.103-70  Amended................................................50452
209.403  (1) amended...............................................50452
209.470  Regulation at 60 FR 13074 confirmed........................7741
209.470-1  Regulations at 60 FR 13074 and 61593 confirmed...........7741
    Revised.........................................................7742
    Revised; interim...............................................25408
209.470-2  Regulation at 60 FR 13074 confirmed......................7741
    Revised; interim...............................................25408
209.470-3  Regulations at 60 FR 13074 and 61593 confirmed...........7741
212.301  (f)(i) removed; (f)(ii), (iii) and (iv) redesignated as 
        (f)(i), (ii), and (iii); new (f)(ii) amended...............50452
212.504  (a)(xix), (xx) and (xxi) removed..........................58488
213  Heading revised................................................7742
213.000  Amended....................................................7742
213.101  Amended....................................................7742
213.204  (b) amended................................................7742
213.401  Redesignated from 213.402..................................7742
213.402  Redesignated as 213.401; new 213.402 redesignated from 
        213.403.....................................................7742

[[Page 751]]

213.403  Redesignated as 213.402; new 213.403 redesignated from 
        213.404; (c)(i)(B) and (ii) amended.........................7742
213.404  Redesignated as 213.403....................................7742
213.505-1  Redesignated from 213.505-2; heading revised; 
        introductory text, (b)(i) introductory text and (F)(3) 
        amended.....................................................7742
213.505-2  Redesignated as 213.505-1................................7742
    Corrected.......................................................9532
213.505-3  (b)(1) introductory text revised.........................7742
    (b)(1) corrected...............................................18195
213.507  Heading and (a)(i) revised.................................7742
214.406-3  (e)(i) and (vi) amended.................................50452
215.605  Heading, (b)(ii)(B) and (E) revised; (b)(iv) added........18687
    (b) revised....................................................50452
215.608  (a) redesignated as (a)(1); (a)(2) added..................18687
215.810  Revised....................................................7742
215.810-2  Added....................................................7742
215.810-3  Added....................................................7743
    (b)(i)(A) corrected............................................18195
216.306  Added......................................................7743
    (c)(i)(C)(iii) corrected.......................................18195
216.603-4  Revised..................................................7743
216.703  (c) revised................................................7743
    (c) corrected..................................................18195
217.202  (3) added..................................................7743
217.7402  Introductory text amended; (b) revised....................7743
217.7404-3  (a) introductory text amended...........................7743
217.7406  Revised...................................................7743
219  Heading revised...............................................18687
    Heading revised; interim.......................................39900
219.602-1  Regulation at 60 FR 40107 confirmed.....................61591
219.702--219.708 (Subpart 219.7)  Heading revised..................50452
219.702  (a) introductory text revised; interim....................39900
    Heading corrected..............................................49008
219.703  (a) corrected.............................................50535
219.704  (a)(4) added..............................................18687
219.708  (b)(1)(A), (B) and (c)(1)(A) revised; interim.............39901
219.1006  (b)(1)(B) revised........................................18687
219.7001  (a) revised..............................................18687
219.7104  (b) amended..............................................54346
219.7200--219.7204 (Subpart 219.72)  Added.........................18688
219.7201  Amended..................................................50452
223.570--223.570-4 (Subpart 223.5)  Regulation at 57 FR 32737 
        confirmed..................................................50450
223.570-4  Regulation at 60 FR 61597 confirmed.....................50450
223.803 (Subpart 223.8)  Added.....................................50452
223.7200--223.7203 (Subpart 223.72)  Added..........................7743
223.7203  Corrected................................................18195
225.402  (c) revised.................................................130
    (a) revised.....................................................7744
225.403  (g)(4) added; (m)(4) removed; interim.....................37841
    (d)(1)(B)(3) amended...........................................50453
225.403-70  Introductory text revised; interim.....................37841
225.408  Heading and (a)(2) revised................................16880
225.970 (Subpart 225.9)  Added.....................................50453
225.7001  Revised; interim.........................................10899
    Regulation at 61 FR 10899 confirmed............................50450
    (a) revised....................................................50453
225.7002-2  (e) and (f) revised....................................50453
225.7002-3  Revised................................................50453
225.7002-4  Removed................................................50453
225.7011-4  (b) introductory text amended..........................50453
225.7004  Removed..................................................58489
225.7004-1  Removed................................................58489
225.7004-2  Removed................................................58489
225.7004-3  Removed................................................58489
225.7004-4  Removed................................................58489
225.7004-5  Removed................................................58489
225.7004-6  Removed................................................58489
225.7005  Added....................................................58489
225.7007-4  Revised................................................58489
225.7010-3  Revised................................................58489
225.7012  Revised; interim.........................................13107
    Regulation at 61 FR 13107 confirmed............................50450
225.7012-1  Revised; interim.......................................13107
    Regulation at 61 FR 13107 confirmed............................50450
225.7012-2  Revised; interim.......................................13107
    Regulation at 61 FR 13107 confirmed............................50450
225.7012-3  Revised; interim.......................................13107
    Regulation at 61 FR 13107 confirmed............................50450
    Heading revised; (1) and (2) redesignated as (a) and (b).......50453

[[Page 752]]

225.7012-4  Removed; interim.......................................13107
    Regulation at 61 FR 13107 confirmed............................50450
225.7016-3  Revised................................................58489
225.7019  Revised; interim.........................................10900
    Regulation at 61 FR 10900 confirmed............................50450
225.7019-1  Revised; interim.......................................10900
    Regulation at 61 FR 10900 confirmed............................50450
    (b) revised....................................................58489
225.7019-2  Revised; interim.......................................10900
    Regulation at 61 FR 10900 confirmed............................50450
    Revised........................................................50453
225.7019-3  Revised; interim.......................................10900
    Regulation at 61 FR 10900 confirmed............................50450
    (a)(2) introductory text revised; (a)(3) added.................50453
225.7019-4  Revised; interim.......................................10900
    Regulation at 61 FR 10900 confirmed............................50450
225.7022  Revised; interim.........................................13107
    Technical correction...........................................16287
    Regulation at 61 FR 13107 confirmed............................50450
225.7022-1  Revised; interim.......................................13107
    Regulation at 61 FR 13107 confirmed............................50450
225.7022-2  Revised; interim.......................................13107
    Regulation at 61 FR 13107 confirmed............................50450
225.7022-3  Added; interim.........................................13107
    Regulation at 61 FR 13107 confirmed............................50450
    Revised........................................................58489
225.7022-4  Added; interim.........................................13107
    Regulation at 61 FR 13107 confirmed............................50450
225.7102  Introductory text revised.................................7744
    Revised........................................................50453
225.7103  (e)(1) revised; (e)(2) redesignated as (e)(3); new 
        (e)(2) added................................................7744
    Revised........................................................50453
225.7104  Revised..................................................50453
225.7303  Heading revised; interim.................................18987
    Regulation at 61 FR 18987 confirmed............................50450
    Amended........................................................50453
225.7303-2  (a)(3) revised..........................................7744
    (a) introductory text and (c) introductory text revised; 
interim............................................................18987
    Regulation at 61 FR 18987 confirmed............................50450
225.7303-5  Added; interim.........................................18988
    Regulation at 61 FR 18988 confirmed............................50450
    (c) corrected..................................................49531
227.7004  (c)(6) amended...........................................50454
227.7009-1  (a) removed; (b) through (f) redesignated as (a) 
        through (e); new (d) amended...............................50454
228.106-4  Removed..................................................7744
228.106-4-70  Removed...............................................7744
228.106-6  Removed..................................................7744
228.171  Removed...................................................50454
228.171-1  Revised; interim.........................................3601
    Removed........................................................50454
228.171-2  (a) revised; interim.....................................3601
    Removed........................................................50454
228.171-3  Revised; interim.........................................3601
    Removed........................................................50454
228.311-1  Removed; new 228.311-1 redesignated from 228.311-2......50454
228.311-2  Redesignated as 228.311-1...............................50454
228.370  Heading revised...........................................50454
231.205-6  (f)(1) added; interim....................................7077
    (a)(2) revised; interim........................................36306
    Regulation at 61 FR 7077 confirmed.............................50450
    (a)(2) and (f)(1) amended......................................50454
    (f)(1) revised; interim........................................58490
    (a)(2)(i) and (ii) redesignated as (a)(2)(i)(A) and (B); new 
(a)(2)(ii) added; interim..........................................65479
231.205-70  Revised................................................16881
    (b)(3) corrected...............................................49531
    (d)(2) amended.................................................50454
    (a) revised; (c)(3) and (d)(10) added; interim.................64635
231.205-71  Added; interim.........................................21975
    (b) amended....................................................50454
231.303  (3) revised; interim......................................36306
231.603  Revised; interim..........................................36306
231.703  Revised; interim..........................................36306
232.501-1  Regulation at 58 FR 62046 confirmed......................7741
232.502-1-71  Regulation at 58 FR 62046 confirmed...................7741
232.703-70  Added...................................................7744
232.803  (d) revised...............................................50454
235.006  (a) and (b)(iv) revised...................................50454

[[Page 753]]

235.7002  (a)(4) amended...........................................50454
235.7003  (c)(6) added..............................................7744
    (b)(4)(ii) amended.............................................50454
235.7004-3  (d) amended.............................................7744
235.7006  (d) amended...............................................7744
    Corrected......................................................18195
236.201  (a) revised................................................7749
236.204  Added......................................................7749
236.271  Revised....................................................7749
236.303-70  (c)(2) introductory text revised.......................18688
236.604  (a) introductory text added................................7749
239.7501-2  Revised................................................50454
242.203  (a)(i)(P) and (Q) amended; (a)(ii) revised; (a)(iii) 
        removed; (a)(iv) and (v) redesignated as (a)(iii) and (iv)
                                                                    7749
242.302  (a)(19) amended; (a)(67) added............................50454
242.803  (b)(i)(C) and (D) redesignated as (b)(i)(D) and (E); new 
        (b)(i)(C) added............................................25409
    (b)(i)(C) amended..............................................50454
242.1106  (a)(i) revised...........................................50455
242.1107-70  Revised...............................................50455
242.1204  (e) revised..............................................16882
242.1503 (Subpart 242.15)  Added...................................18688
242.7202  (d) revised..............................................50455
242.7203  Revised..................................................50455
242.7204  (a)(1) and (2) amended...................................50455
242.7206  Introductory text amended................................50455
243.105  Revised; interim..........................................25408
244.303  Removed...................................................50455
244.304  (b) introductory text amended.............................50455
246.770-2  (b) and (c) redesignated as (c) and (d); new (b) added; 
        new (c) revised.............................................7749
246.770-8  (a) introductory text, (c) introductory text and (2) 
        revised; (b)(2) removed; (b)(3) redesignated as (b)(2)......7750
249.102  Removed...................................................67952
249.7001  (b)(4) and (9) amended...................................50455
249.7002  Removed..................................................67952
249.7003  Revised; interim.........................................64637
    (c) corrected..................................................66077
250.303  (5) and (10) amended......................................50455
252.209-7005  Amended...............................................7750
    Corrected......................................................18195
252.209-7007  Regulations at 60 FR 13074 and 61600 confirmed........7741
252.212-7000  Introductory text amended............................50455
252.212-7001  Introductory text amended............................50455
    Amended........................................................58489
252.217-7027  Revised...............................................7750
    Corrected......................................................18195
252.219-7003  Amended..............................................18688
252.219-7004  Amended; interim.....................................39901
252.219-7008  Added................................................18688
252.223-7004  Regulation at 57 FR 32737 confirmed..................50450
252.223-7007  Added.................................................7750
252.225-7007  Amended.........................................130, 16880
    Amended; interim...............................................37842
252.225-7012  Introductory text amended............................50455
252.225-7013  Removed..............................................50455
252.225-7014  Amended..............................................50455
252.225-7015  Introductory text amended............................50455
252.225-7016  Revised; interim.....................................10900
    Regulation at 61 FR 10900 confirmed............................50450
    Revised........................................................50455
252.225-7017  Removed..............................................58489
252.225-7019  Introductory text amended; interim...................13108
    Regulation at 61 FR 13108 confirmed............................50450
252.225-7020  Removed; interim.....................................13108
    Regulation at 61 FR 13108 confirmed............................50450
252.225-7021  Removed; interim.....................................13108
    Regulation at 61 FR 13108 confirmed............................50450
252.225-7025  Revised..............................................50456
252.225-7039  Amended; introductory text revised; interim..........13108
    Regulation at 61 FR 13108 confirmed............................50450
252.225-7040  Removed..............................................58489
252.228-7001  Amended..............................................50456
252.228-7002  Amended..............................................50456
252.228-7006  Removed...............................................7750
252.228-7007  Amended; interim......................................3601
    Removed........................................................50456
252.232-7004  Regulation at 58 FR 62046 confirmed...................7741
    Amended.........................................................7750
252.242-7004  Amended..............................................50456
252.249-7001  Removed..............................................67952
252.249-7002  Revised; interim.....................................64637
253.204-70  (e)(3) revised.........................................18688

[[Page 754]]

    (d)(5)(iv)(C) corrected........................................43119
    (e)(3)(ii) corrected...........................................49531
    (c)(4)(ix)(B)(9) amended.......................................50456
    Revised........................................................51032
253.204-71  Second (f) correctly designated as (f)(1)..............43119
    Revised........................................................51040
253.213-70  (e) amended.............................................7751
253.215-70  Note amended............................................7751
    Note corrected.................................................18195
    (c)(2) and (6) revised.........................................51043
Chapter  Appendix G amended.........................................7751
    Appendix G corrected...........................................18195
    Appendix B amended.............................................50456
    Appendix C removed; Appendix G amended.........................50457
    Appendixes G and I amended.....................................50458
    Appendix I amended.............................................54346

                                  1997

  (Regulations published from January 1, 1997, through October 1, 1997)

48 CFR
                                                                   62 FR
                                                                    Page
Chapter 2
201.603-2  (1) introductory text revised...........................34121
202.101  Amended...................................................34121
203.104-4  Removed..................................................2612
203.104-5  (e)(4) redesignated as (d)(4); new (d)(4) amended........2612
203.170  Removed....................................................2612
203.170-1  Removed..................................................2612
203.170-2  Removed..................................................2612
203.170-3  Removed..................................................2612
203.170-4  Removed..................................................2612
203.405  Redesignated from 203.409.................................34121
203.409  Redesignated as 203.405...................................34121
203.570-5  Amended.................................................34121
204.670-1  (c)(4) revised..........................................34121
204.670-2  (a)(1) revised..........................................34121
    (c) revised....................................................44222
204.670-9  Introductory text and (a) revised.......................34121
204.805  Amended...................................................40472
204.7003  (a)(1)(i)(G) revised.....................................34121
204.7201  (b) amended..............................................48181
204.7202-1  (c)(5) redesignated as (d).............................34121
204.7202-2  Introductory text and (b)(1) introductory text amended
                                                                   34121
    Revised........................................................48181
204.7202-4  Removed................................................48181
204.7204  Revised..................................................48181
204.7204-1  Removed................................................48182
204.7204-2  Removed................................................48182
204.7206  Introductory text amended................................48182
208.002  (f) revised...............................................34121
208.7203  (d) removed; (e), (f) and (g) redesignated as (d), (e) 
        and (f); (c) and new (d) revised...........................34121
209.104-1  (g)(ii)(C) introductory text amended; (g)(ii)(D) added; 
        (g)(iii) removed...........................................34121
209.104-70  Heading revised; (c) and (d) removed...................34122
209.470-1  Regulation at 61 FR 25408 confirmed.....................34120
209.470-2  Regulation at 61 FR 25408 confirmed.....................34120
211.273  Added; interim............................................44224
211.273-1  Added; interim..........................................44224
211.273-2  Added; interim..........................................44224
211.273-3  Added; interim..........................................44224
211.273-4  Added; interim..........................................44224
212  Heading revised; interim.......................................5780
    Regulation at 62 FR 5780 confirmed.............................47154
212.301  (f)(iii) amended..........................................34122
212.504  (a)(i) removed; interim....................................5780
    Regulation at 62 FR 5780 confirmed.............................47154
214.406  Redesignated as 214.407...................................34122
214.406-3  Redesignated as 214.407-3...............................34122
214.407  Redesignated from 214.406.................................34122
214.407-3  Redesignated from 214.406-3; (e) introductory text 
        amended; (e)(v) revised....................................34122
215.608  (b) amended................................................2612
215.801  Removed...................................................40472
215.804  Revised...................................................40472
215.804-1  Revised.................................................40472
215.804-3  Removed.................................................40472
215.804-6  (b)(2)(A) and (B) redesignated as (b)(1)(A) and (B).....40472
215.805-5  (a)(1)(A) revised.......................................40472
215.805-70  (b) revised............................................40472

[[Page 755]]

215.811-70  (b)(2), (g)(3)(ii) and (h) revised.....................40472
215.872  Removed...................................................40472
215.872-1  Removed.................................................40472
215.872-2  Removed.................................................40472
215.872-3  Removed.................................................40472
215.872-4  (d)(1) revised..........................................34122
    Removed........................................................40472
215.873  (d) revised................................................2613
216.203-4  (d)(xvi) amended........................................40472
216.203-4-70  (c) added............................................34122
    (a) revised; (b)(4) and (6) removed; (b)(5) and (7) 
redesignated as (b)(4) and (5).....................................40472
216.306  Revised....................................................1058
    (c)(ii)(B)(2) corrected.........................................1817
    (c)(i) and (ii)(B) corrected...................................49305
216.307  Removed...................................................34122
219  Regulation at 61 FR 39900 confirmed...........................34120
219.301  (b) revised................................................2613
219.302-70  (d) and (e) revised.....................................2613
219.602--219.602-3 (Subpart 219.6)  Heading revised................34122
219.602-3  (c)(i)(A) amended.......................................34122
219.702  Regulation at 61 FR 39900 confirmed.......................34120
219.708  Regulation at 61 FR 39901 confirmed.......................34120
219.808  Removed...................................................34122
219.808-1  Removed.................................................34122
219.811  Removed...................................................34122
219.811-1  Removed.................................................34122
219.811-3  Removed.................................................34122
219.1005  (a) introductory text removed............................34122
219.1006  (b)(2) revised...........................................34122
222.7200--222.7201 (Subpart 222.72)  Added.........................34122
224.202  Redesignated as 224.203...................................34122
224.203  Redesignated from 224.202.................................34122
225.205  Removed...................................................34122
225.205-70  Removed................................................34122
225.403  Regulation at 61 FR 37841 confirmed.......................34120
    (c) and (d)(1)(A) redesignated as (b) and (c)(1)(A)............34122
225.403-70  Amended.................................................2615
    Regulation at 61 FR 37841 confirmed............................34120
225.603  (1)(iii)(C)(2) revised.....................................2613
225.872-1  (d) added; interim......................................34122
225.872-2  (a)(3) revised; interim.................................34123
225.971  Added.....................................................34123
225.972  Added.....................................................34123
225.7000--225.7023-3 (Subpart 225.70)  Heading revised.............34123
225.7000  (a) revised; interim......................................2856
    Regulation at 62 FR 2856 confirmed.............................34120
225.7002-1  (a) introductory text, (7) and (9) revised; interim.....5780
    Regulation at 62 FR 5780 confirmed; (a)(9) revised.............47154
    Correctly designated...........................................49305
225.7002-2  (e) and (j) revised; interim............................5780
    Regulation at 62 FR 5780 confirmed; (j) revised................47154
225.7003  Added; interim............................................2856
    Regulation at 62 FR 2856 confirmed.............................34120
225.7004  Added; interim............................................2857
    Regulation at 62 FR 2857 confirmed.............................34120
225.7005  (a)(3) revised............................................2616
    Revised; interim...............................................34123
    Corrected......................................................44225
225.7007-1  Revised; interim.......................................34123
225.7007-3  Revised; interim.......................................34123
225.7007-4  Revised; interim.......................................34123
225.7009  Removed..................................................34123
225.7010-1  Introductory text and (a) revised; interim.............34123
225.7010-2  Revised; interim.......................................34123
225.7010-3  Revised; interim.......................................34123
225.7013  Removed..................................................34123
225.7013-1  Removed................................................34123
225.7013-2  Removed................................................34123
225.7016-1  Revised; interim.......................................34123
225.7016-2  Revised; interim.......................................34124
225.7016-3  Revised; interim.......................................34124
225.7019-1  (a) revised; interim...................................34124
225.7019-3  (a)(1)(iv) revised......................................2616
    (a)(1)(iv) revised; interim; (a)(2) and (3) redesignated as 
(a)(3) and (4); new (a)(2) added...................................34124
225.7020  Removed..................................................34124
225.7020-1  Removed................................................34124
225.7020-2  Removed................................................34124
225.7022-1  (b) revised; interim...................................34124
225.7022-2  Revised; interim.......................................34124
225.7022-3  Revised; interim.......................................34124
225.7100--225.7105 (Subpart 225.71)  Revised; interim..............34124
225.7302  (a)(1) removed; (a)(2) through (5) redesignated as 
        (a)(1) through (4); interim.................................2617

[[Page 756]]

225.7303-4  Revised; interim........................................2617
225.7307  Revised..................................................34125
225.7307-1  Removed................................................34125
225.7307-2  Removed................................................34125
225.7308  (a) revised; interim......................................2617
226.7005  (b) introductory text and (1) revised.....................2613
226.7008  (b) amended...............................................2613
227.676  Added.....................................................34125
227.7004  (a)(6) amended............................................2613
227.7103-6  (e)(3) amended..........................................2613
227.7104  (e)(5) amended............................................2614
228.370  (f) added.................................................34125
229.101  (d)(i), (ii) and (iii) redesignated as (d)(iii), (iv) and 
        (v); new (d)(i), new (ii) and (vi) added...................34125
229.402--229.402-70 (Subpart 229.4)  Added.........................34125
229.7000--229.7002-4 (Subpart 229.70)  Added.......................34125
231.205-6  Regulations at 61 FR 36306, 58490 and 65479 confirmed 
                                                                   34120
231.205-22  Revised................................................47155
231.205-70  Regulation at 61 FR 64635 confirmed....................34120
    (c)(3)(ii) corrected...........................................49304
231.303  Regulation at 61 FR 36306 confirmed.......................34120
    (4) added......................................................47155
231.603  Regulation at 61 FR 36306 confirmed.......................34120
    Existing text designated as (1); (2) added.....................47155
231.703  Regulation at 61 FR 36306 confirmed.......................34120
    Existing text designated as (1); (2) added.....................47155
232.502-1-71  (b)(3) revised.......................................40473
232.806  Revised...................................................34126
233.214  Redesignated as 233.215...................................34126
233.215  Redesignated from 233.214.................................34126
233.215-70  Added..................................................34126
233.7000--233.7001 (Subpart 233.70)  Removed........................2614
234.003  Revised...................................................34126
234.005-70  Revised; interim........................................9991
234.005-71  Added; interim..........................................9991
    (b) corrected...........................................11953, 49305
235.006  (b)(1)(C)(1)(iii) amended.................................34126
235.010  (b) amended...............................................34126
235.7001  (a) removed; (b) and (c) redesignated as (a) and (b).....16100
235.7002  (a) introductory text, (b) and (d) revised...............16100
235.7003  Removed..................................................16100
235.7005  Heading and introductory text revised....................16100
235.7006  Revised..................................................16100
    (d) amended; interim...........................................37147
    Exhibit corrected..............................................49305
236.102  (4) added; interim.........................................2857
    Regulation at 62 FR 2857 confirmed.............................34120
236.274  Introductory text, (a), (b) introductory text and (1) 
        through (8) redesignated as (b) introductory text, (1), 
        (2) introductory text and (i) through (viii); new (a) 
        added; interim..............................................2856
    Regulation at 62 FR 2856 confirmed.............................34120
    (b)(2)(viii) revised...........................................34127
236.570  (c) added; interim.........................................2856
    Regulation at 62 FR 2856 confirmed.............................34120
    (d) added......................................................34127
236.602-70  Added; interim..........................................2858
    Regulation at 62 FR 2858 confirmed.............................34120
236.609-70  Heading revised; (a) introductory text, (1), (2) and 
        (b) redesignated as (a)(1) introductory text, (i), (ii) 
        and (2); new (b) added; interim.............................2858
    Regulation at 62 FR 2858 confirmed.............................34120
    Heading revised................................................34127
237.7102  (a) and (b) amended......................................34127
239  Heading revised; interim.......................................9376
    Regulation at 62 FR 9376 confirmed.............................34120
239.001  Removed; interim...........................................1059
    Regulation at 62 FR 1059 confirmed.............................34120
239.001-70  Removed.................................................1059
239.002  Removed; interim...........................................1059
    Regulation at 62 FR 1059 confirmed.............................34120
239.7000--239.7003 (Subpart 239.70)  Revised; interim...............1059
    Regulation at 62 FR 1059 confirmed.............................34120
239.7003  (f)(1) amended...........................................34127

[[Page 757]]

    (f)(2)(iv) corrected...........................................49305
239.7102-3  (a) designation and (b) removed; interim................1060
    Regulation at 62 FR 1060 confirmed.............................34120
    Revised........................................................34127
239.7201  Removed; interim..........................................1060
    Regulation at 62 FR 1060 confirmed.............................34120
239.7202  (a) and (b) revised; interim..............................1060
    Regulation at 62 FR 1060 confirmed.............................34120
239.7300  Revised; interim..........................................9376
    Regulation at 62 FR 9376 confirmed.............................34120
239.7301  (a) revised; interim......................................9376
    Regulation at 62 FR 9376 confirmed.............................34120
239.7302  (a), (b) introductory text and (2) revised; interim.......1060
    (b) introductory text and (1) revised; interim..................9376
    Regulations at 62 FR 1060 and 9376 confirmed...................34120
    (b)(2)(i) revised..............................................34127
239.7303  Revised; interim..........................................9376
    Regulation at 62 FR 9376 confirmed.............................34120
239.7304  (c) revised; interim......................................1060
    Removed; interim................................................9376
    Regulations at 62 FR 1060 and 9376 confirmed...................34120
239.7305  Removed; interim..........................................9376
    Regulation at 62 FR 9376 confirmed.............................34120
239.7400  Revised; interim..........................................1060
    Regulation at 62 FR 1060 confirmed.............................34120
239.7402  (b)(4) amended; interim...................................1060
    Regulation at 62 FR 1060 confirmed.............................34120
239.7406  Revised..................................................40473
239.7411  (a)(7) amended; (a)(8) and (9) removed...................40473
239.7500  Amended..................................................34127
239.7501  Revised; interim..........................................1060
    Regulation at 62 FR 1060 confirmed.............................34120
239.7501-1  Removed; interim........................................1060
    Regulation at 62 FR 1060 confirmed.............................34120
239.7501-2  Removed; interim........................................1060
    Regulation at 62 FR 1060 confirmed.............................34120
239  Table 39-1 removed; interim....................................9376
    Regulation at 62 FR 9376 confirmed.............................34120
242.101  (d)(i) introductory text and (ii) amended; (d)(i)(A) 
        revised....................................................34127
242.102  (b)(ii) introductory text amended.........................34127
242.302  (a)(41) revised; interim...................................9991
    (a)(S-70) added; interim.......................................44224
    Heading and (a) corrected......................................11953
    Correctly designated; (a) corrected............................49305
242.1404-2-70  Revised.............................................34127
242.7000--242.7004 (Subpart 242.70)  Removed.......................34127
243.105  Regulation at 61 FR 25408 confirmed.......................34130
243.204-70  Added; interim.........................................37147
243.205-72  Added; interim.........................................37147
244.403 (Subpart 244.4)  Added; interim.............................5780
    Regulation at 62 FR 5780 confirmed.............................47154
    Corrected......................................................49305
245.302-1  (a)(4)(A)(2), (C) introductory text and (b)(1) revised 
                                                                   34127
245.407  (a)(ii) amended...........................................34127
245.505-6  (2) amended.............................................34127
245.608-5  (a)(2)(B)(2) and (4) revised; (d) removed...............34128
245.608-71  (a) revised; (b)(1) introductory text, (2)(i), 
        (ii)(C), (3)(iii), (c) and (d) amended.....................34128
245.608-72  Added..................................................34128
245.7206  Introductory text and (j)(2) amended.....................34128
246.710  (4) added.................................................34128
249.110  Table 49-1 amended........................................34128
249.7003  Regulation at 61 FR 64637 confirmed......................34120
    (b)(2) corrected...............................................49304
252.203-7000  Removed...............................................2612
252.203-7001  Amended..............................................34128
252.209-7003  Removed..............................................34128
252.209-7004  Removed..............................................34128
252.211-7005  Added; interim.......................................44224
    Amended.........................................................2614
    Amended; interim...................................2617, 5780, 37147
    Regulation at 62 FR 5780 confirmed.............................47154

[[Page 758]]

252.215-7000  Introductory text amended............................40473
252.215-7002  Amended..............................................40473
252.216-7000  Amended........................................2614, 40473
252.216-7001  Amended........................................2614, 40473
252.216-7002  Removed..............................................34128
252.216-7003  Added................................................34128
252.217-7005  Amended...............................................2614
252.219-7000  Amended...............................................2614
    Amended........................................................34128
252.219-7004  Regulation at 61 FR 39901 confirmed..................34120
    Amended........................................................34129
252.219-7006  Amended..............................................34129
252.219-7007  Removed..............................................34129
252.222-7002  Added................................................34129
252.222-7003  Added................................................34129
252.222-7004  Added................................................34129
252.225-7004  Removed..............................................34129
252.225-7006  Revised..............................................34129
252.225-7007  Regulation at 61 FR 37842 confirmed..................34120
    Revised........................................................34130
    Amended........................................................37148
252.225-7009  Amended...............................................2614
252.225-7010  Amended...............................................2614
252.225-7012  Amended; interim......................................5780
    Regulation at 62 FR 5780 confirmed; amended....................47154
252.225-7014  Amended; interim......................................5780
    Regulation at 62 FR 5780 confirmed.............................47154
252.225-7016  Amended..............................................34131
252.225-7018  Amended...............................................2614
252.225-7022  Revised..............................................34131
252.225-7025  Revised..............................................34131
252.225-7027  Revised; interim......................................2617
252.225-7029  Revised; interim.....................................34131
252.225-7034  Removed..............................................34131
252.225-7037  Amended...............................................2614
252.225-7041  Added................................................34132
252.225-7042  Added................................................34132
252.226-7001  Amended; heading revised..............................2614
252.227-7030  Introductory text amended............................34132
252.227-7036  Revised...............................................2614
252.228-7006  Added................................................34132
    Correctly designated...........................................49305
252.229-7000  Added................................................34132
252.229-7001  Added................................................34132
252.229-7002  Added................................................34133
252.229-7003  Added................................................34133
    (d)(1) corrected...............................................49305
252.229-7004  Added................................................34133
252.229-7005  Added................................................34133
252.229-7006  Added................................................34134
252.229-7007  Added................................................34134
252.229-7008  Added................................................34134
252.229-7009  Added................................................34134
252.229-7010  Added................................................34134
252.232-7008  Added................................................34134
252.233-7000  Removed...............................................2614
252.233-7001  Added................................................34135
252.234-7000  Revised; interim......................................9991
    Amended........................................................34135
    (a) corrected..................................................49305
252.234-7001  Revised; interim......................................9992
    Amended........................................................34135
    Corrected......................................................49305
252.236-7003  Amended...............................................2614
252.236-7006  Amended...............................................2615
252.236-7010  Added; interim........................................2857
    Regulation at 62 FR 2857 confirmed.............................34120
252.236-7011  Added; interim........................................2858
    Regulation at 62 FR 2858 confirmed.............................34120
252.239-7006  Amended..............................................40473
252.239-7007  Amended...............................................2615
252.239-7009  Removed..............................................40473
252.239-7010  Removed..............................................40473
252.242-7002  Removed..............................................34135
252.242-7003  Introductory text amended............................34135
252.242-7005  Amended..............................................34135
    Revised; interim................................................9992
252.242-7006  Amended..............................................34135
    Added; interim..................................................9992
252.243-7000  Amended..............................................40473
252.243-7002  Added; interim.......................................37147
    Corrected......................................................49306
252.244-7000  Added; interim........................................5780
    Regulation at 62 FR 5780 confirmed.............................47154
252.246-7002  Added................................................34135
    (c) corrected..................................................49306
252.247-7001  Amended...............................................2615
252.249-7002  Regulation at 61 FR 64637 confirmed..................34120
253.204-70  (b)(2) heading, (13)(i)(E) introductory text, (F), 
        (iv)(C), (c)(2), (4)(iv)(A), (viii)(B)(8)(i), 
        (d)(5)(i)(J), (ii)(B), (iv)(E)(1) and (x)(B)(14)...........34135
    (b)(10)(i), (13)(i)(C), (G), (c)(2), (4)(xi), (d)(5)(vii)(A) 
and (e)(4) revised; (b)(14), (d)(5)(vii)(D) and (e)(5) added.......44222

[[Page 759]]

    (b)(3)(ii) and (13)(i)(D) correctly designated; (b)(5)(i), 
(ii)(C), (6)(i), (iv) introductory text, (B)(1), (2), (C), (12)(i) 
introductory text, (C), (13)(i)(B)(5), (iv)(G), (c)(4)(iii) 
introductory text, (B)(3), (viii)(B)(3), (xii)(B), (F), (d)(3), 
(5)(i)(I), (iii)(E) corrected......................................49304
253.204-71  (c)(1) amended; (d)(6)(i)(B) revised...................34136
    (a)(3) revised.................................................44223
253  Note amended..................................................34136
Chapter  Appendix G amended........................................34136
    Appendix I amended.............................................34141