[Title 48 CFR ]
[Code of Federal Regulations (annual edition) - October 1, 2003 Edition]
[From the U.S. Government Printing Office]



[[Page i]]

   

                    48


          Chapter 1 (Parts 52 to 99)

                         Revised as of October 1, 2003

Federal Acquisition Regulations System





          Contains a codification of documents of general applicability 
          and future effect
          As of October 1, 2003
          With Ancillaries
          Published by
          Office of the Federal Register
          National Archives and Records
          Administration

A Special Edition of the Federal Register

[[Page ii]]






                     U.S. GOVERNMENT PRINTING OFFICE
                            WASHINGTON : 2003



  For sale by the Superintendent of Documents, U.S. Government Printing 
                                  Office
  Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC area 
                              (202) 512-1800
      Fax: (202) 512-2250 Mail: Stop SSOP, Washington, DC 20402-0001

[[Page iii]]




                            Table of Contents



                                                                    Page
  Explanation.................................................       v

  Title 48:
          Chapter 1--Federal Acquisition Regulation 
          (Continued)                                                3
  Finding Aids:
      Table of CFR Titles and Chapters........................     581
      Alphabetical List of Agencies Appearing in the CFR......     599
      Table of OMB Control Numbers............................     609
      List of CFR Sections Affected...........................     613

[[Page iv]]





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

                     Cite this Code: CFR
                     To cite the regulations in 
                       this volume use title, 
                       part and section number. 
                       Thus, 48 CFR 52.000 refers 
                       to title 48, part 52, 
                       section 000.

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

[[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, 2003), 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, 2001, consult either the List of CFR Sections Affected, 1949-
1963, 1964-1972, 1973-1985, or 1986-2000, published in 11 separate 
volumes. For the period beginning January 1, 2001, 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). 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 202-741-6000 
or write to the Director, Office of the Federal Register, National 
Archives and Records Administration, Washington, DC 20408 or e-mail 
[email protected].

SALES

    The Government Printing Office (GPO) processes all sales and 
distribution of the CFR. For payment by credit card, call toll free, 
866-512-1800, or DC area, 202-512-1800, M-F 8 a.m. to 4 p.m. e.s.t. or 
fax your order to 202-512-2250, 24 hours a day. For payment by check, 
write to the Superintendent of Documents, Attn: New Orders, P.O. Box 
371954, Pittsburgh, PA 15250-7954. For GPO Customer Service call 202-
512-1803.

ELECTRONIC SERVICES

    The full text of the Code of Federal Regulations, the LSA (List of 
CFR Sections Affected), The United States Government Manual, the Federal 
Register, Public Laws, Public Papers, Weekly Compilation of Presidential 
Documents and the Privacy Act Compilation are available in electronic 
format at www.access.gpo.gov/nara (``GPO Access''). For more 
information, contact Electronic Information Dissemination Services, U.S. 
Government Printing Office. Phone 202-512-1530, or 888-293-6498 (toll-
free). E-mail, [email protected].

[[Page vii]]

    The Office of the Federal Register also offers a free service on the 
National Archives and Records Administration's (NARA) World Wide Web 
site for public law numbers, Federal Register finding aids, and related 
information. Connect to NARA's web site at www.archives.gov/federal--
register. The NARA site also contains links to GPO Access.

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

October 1, 2003.

[[Page ix]]



                               THIS TITLE

    Title 48--Federal Acquisition Regulations System is composed of 
seven volumes. The chapters in these volumes are arranged as follows: 
Chapter 1 (parts 1 to 51), chapter 1 (parts 52 to 99), chapter 2 (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, 2003.

    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.

[[Page x]]




[[Page 1]]



            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM




             (This book contains chapter 1, parts 52 to 99)

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

chapter 1--Federal Acquisition Regulation (Continued).......          52

[[Page 3]]



          CHAPTER 1--FEDERAL ACQUISITION REGULATION (CONTINUED)




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

                     SUBCHAPTER H--CLAUSES AND FORMS
Part                                                                Page
52              Solicitation provisions and contract clauses           5
53              Forms.......................................         396
54-99           [Reserved]

[[Page 5]]



                     SUBCHAPTER H_CLAUSES AND FORMS





PART 52_SOLICITATION PROVISIONS AND CONTRACT CLAUSES--Table of Contents




Sec.
52.000 Scope of part.

       Subpart 52.1_Instructions for Using Provisions and Clauses

52.100 Scope of subpart.
52.101 Using part 52.
52.102 Incorporating provisions and clauses.
52.103 Identification of provisions and clauses.
52.104 Procedures for modifying and completing provisions and clauses.
52.105 Procedures for using alternates.
52.106 [Reserved]
52.107 Provisions and clauses prescribed in subpart 52.1.

               Subpart 52.2_Text of Provisions and Clauses

52.200 Scope of subpart.
52.201 [Reserved]
52.202-1 Definitions.
52.203-1 [Reserved]
52.203-2 Certificate of Independent Price Determination.
52.203-3 Gratuities.
52.203-4 [Reserved]
52.203-5 Covenant Against Contingent Fees.
52.203-6 Restrictions on Subcontractor Sales to the Government.
52.203-7 Anti-Kickback Procedures.
52.203-8 Cancellation, Rescission, and Recovery of Funds for Illegal or 
          Improper Activity.
52.203-9 [Reserved]
52.203-10 Price or Fee Adjustment for Illegal or Improper Activity.
52.203-11 Certification and Disclosure Regarding Payments to Influence 
          Certain Federal Transactions.
52.203-12 Limitation on Payments to Influence Certain Federal 
          Transactions.
52.204-1 Approval of Contract.
52.204-2 Security Requirements.
52.204-3 Taxpayer identification.
52.204-4 Printed or Copied Double-Sided on Recycled Paper.
52.204-5 Women-Owned Business (Other Than Small Business).
52.204-6 Data Universal Numbering System (DUNS) Number.
52.204-7 Central Contractor Registration.
52.205-52.206 [Reserved]
52.207-1 Notice of Cost Comparison (Sealed-Bid).
52.207-2 Notice of Cost Comparison (Negotiated).
52.207-3 Right of First Refusal of Employment.
52.207-4 Economic Purchase Quantity--Supplies.
52.207-5 Option to Purchase Equipment.
52.208-1--52.208-3 [Reserved]
52.208-4 Vehicle Lease Payments.
52.208-5 Condition of Leased Vehicles.
52.208-6 Marking of Leased Vehicles.
52.208-7 Tagging of Leased Vehicles.
52.208-8 Required Sources for Helium and Helium Usage Data.
52.208-9 Probable cause hearing and determination.
52.209-1 Qualification Requirements.
52.209-3 First Article Approval--Contractor Testing.
52.209-4 First Article Approval--Government Testing.
52.209-5 Certification Regarding Debarment, Suspension, Proposed 
          Debarment, and Other Responsibility Matters.
52.209-6 Protecting the Government's Interest When Subcontracting With 
          Contractors Debarred, Suspended, or Proposed for Debarment.
52.211-1 Availability of Specifications Listed in the GSA Index of 
          Federal Specifications, Standards and Commercial Item 
          Descriptions, FPMR Part 101-29.
52.211-2 Availability of Specifications Listed in the DoD Index of 
          Specifications and Standards (DoDISS) and descriptions listed 
          in the Acquisition Management Systems and Data Requirements 
          Control List, DoD 5010.12-L.
52.211-3 Availability of Specifications Not Listed in the GSA Index of 
          Federal Specifications, Standards and Commercial Item 
          Descriptions.
52.211-4 Availability for Examination of Specifications Not Listed in 
          the GSA Index of Federal Specifications, Standards and 
          Commercial Item Descriptions.
52.211-5 Material Requirements.
52.211-6 Brand name or equal.
52.211-7 Alternatives to Government-unique standards.
52.211-8 Time of Delivery.
52.211-9 Desired and Required Time of Delivery.
52.211-10 Commencement, Prosecution, and Completion of Work.
52.211-11 Liquidated Damages--Supplies, Services, or Research and 
          Development.
52.211-12 Liquidated Damages--Construction.
52.211-13 Time Extensions.
52.211-14 Notice of Priority Rating for National Defense Use.
52.211-15 Defense Priority and Allocation Requirements.
52.211-16 Variation in Quantity.

[[Page 6]]

52.211-17 Delivery of Excess Quantities.
52.211-18 Variation in Estimated Quantity.
52.212-1 Instructions to Offerors--Commercial Items.
52.212-2 Evaluation--Commercial Items.
52.212-3 Offeror Representations and Certifications--Commercial Items.
52.212-4 Contract Terms and Conditions--Commercial Items.
52.212-5 Contract Terms and Conditions Required to Implement Statutes or 
          Executive Orders--Commercial Items.
52.213-1 Fast Payment Procedure.
52.213-2 Invoices.
52.213-3 Notice to Supplier.
52.213-4 Terms and Conditions--Simplified Acquisitions (Other Than 
          Commercial Items).
52.214-1--52.214-2 [Reserved]
52.214-3 Amendments to Invitations for Bids.
52.214-4 False Statements in Bids.
52.214-5 Submission of Bids.
52.214-6 Explanation to Prospective Bidders.
52.214-7 Late Submissions, Modifications, and Withdrawals of Bids.
52.214-8 [Reserved]
52.214-9 [Reserved]
52.214-10 Contract Award--Sealed Bidding.
52.214-11 [Reserved]
52.214-12 Preparation of Bids.
52.214-13 Telegraphic Bids.
52.214-14 Place of Performance--Sealed Bidding.
52.214-15 Period for Acceptance of Bids.
52.214-16 Minimum Bid Acceptance Period.
52.214-17 [Reserved]
52.214-18 Preparation of Bids--Construction.
52.214-19 Contract Award--Sealed Bidding--Construction.
52.214-20 Bid Samples.
52.214-21 Descriptive Literature.
52.214-22 Evaluation of Bids for Multiple Awards.
52.214-23 Late Submissions, Modifications, and Withdrawals of Technical 
          Proposals Under Two-Step Sealed Bidding.
52.214-24 Multiple Technical Proposals.
52.214-25 Step Two of Two-Step Sealed Bidding.
52.214-26 Audit and Records--Sealed Bidding.
52.214-27 Price Reduction for Defective Cost or Pricing Data--
          Modifications--Sealed Bidding.
52.214-28 Subcontractor Cost or Pricing Data--Modifications--Sealed 
          Bidding.
52.214-29 Order of Precedence--Sealed Bidding.
52.214-30 Annual Representations and Certifications--Sealed Bidding.
52.214-31 Facsimile Bids.
52.214-32 Late Submissions, Modifications, and Withdrawals of Bids 
          (Overseas).
52.214-33 Late Submissions, Modifications, and Withdrawals of Technical 
          Proposals Under Two-Step Sealed Bidding (Overseas).
52.214-34 Submission of Offers in the English Language.
52.214-35 Submission of Offers in U.S. Currency.
52.215-1 Instructions to Offerors--Competitive Acquisition.
52.215-2 Audit and Records--Negotiation.
52.215-3 Request for Information or Solicitation for Planning Purposes.
52.215-4 [Reserved]
52.215-5 Facsimile Proposals.
52.215-6 Place of Performance.
52.215-7 Annual Representations and Certifications--Negotiation.
52.215-8 Order of Precedence--Uniform Contract Format.
52.215-9 Changes or Additions to Make-or-Buy Program.
52.215-10 Price Reduction for Defective Cost or Pricing Data.
52.215-11 Price Reduction for Defective Cost or Pricing Data--
          Modifications.
52.215-12 Subcontractor Cost or Pricing Data.
52.215-13 Subcontractor Cost or Pricing Data--Modifications.
52.215-14 Integrity of Unit Prices.
52.215-15 Pension adjustments and asset reversions.
52.215-16 Facilities Capital Cost of Money.
52.215-17 Waiver of Facilities Capital Cost of Money.
52.215-18 Reversion or Adjustment of Plans for Postretirement Benefits 
          (PRB) Other Than Pensions.
52.215-19 Notification of Ownership Changes.
52.215-20 Requirements for Cost or Pricing Data or Information Other 
          Than Cost or Pricing Data.
52.215-21 Requirements for Cost or Pricing Data or Information Other 
          Than Cost or Pricing Data--Modifications.
52.215-22--52.215-42 [Reserved]
52.216-1 Type of Contract.
52.216-2 Economic Price Adjustment--Standard Supplies.
52.216-3 Economic Price Adjustment--Semistandard Supplies.
52.216-4 Economic Price Adjustment--Labor and Material.
52.216-5 Price Redetermination--Prospective.
52.216-6 Price Redetermination--Retroactive.
52.216-7 Allowable Cost and Payment.
52.216-8 Fixed Fee.
52.216-9 Fixed Fee--Construction.
52.216-10 Incentive Fee.
52.216-11 Cost Contract--No Fee.
52.216-12 Cost-Sharing Contract--No Fee.
52.216-13 Allowable Cost and Payment--Facilities.
52.216-14 Allowable Cost and Payment--Facilities Use.

[[Page 7]]

52.216-15 Predetermined Indirect Cost Rates.
52.216-16 Incentive Price Revision--Firm Target.
52.216-17 Incentive Price Revision--Successive Targets.
52.216-18 Ordering.
52.216-19 Order Limitations.
52.216-20 Definite Quantity.
52.216-21 Requirements.
52.216-22 Indefinite Quantity.
52.216-23 Execution and Commencement of Work.
52.216-24 Limitation of Government Liability.
52.216-25 Contract Definitization.
52.216-26 Payments of Allowable Costs Before Definitization.
52.216-27 Single or Multiple Awards.
52.216-28 Multiple Awards for Advisory and Assistance Services.
52.217-1 [Reserved]
52.217-2 Cancellation Under Multiyear Contracts.
52.217-3 Evaluation Exclusive of Options.
52.217-4 Evaluation of Option Exercised at Time of Contract Award.
52.217-5 Evaluation of Options.
52.217-6 Option for Increased Quantity.
52.217-7 Option for Increased Quantity--Separately Priced Line Item.
52.217-8 Option to Extend Services.
52.217-9 Option to Extend the Term of the Contract.
52.218 [Reserved]
52.219-1 Small Business Program Representations.
52.219-2 Equal Low Bids.
52.219-3 Notice of total HUBZone set-aside.
52.219-4 Notice of price evaluation preference for HUBZone small 
          business concerns.
52.219-5 Very small business set-aside.
52.219-6 Notice of Total Small Business Set-Aside.
52.219-7 Notice of Partial Small Business Set-Aside.
52.219-8 Utilization of small business concerns.
52.219-9 Small, Small Disadvantaged and Women-Owned Small Business 
          Subcontracting Plan.
52.219-10 Incentive Subcontracting Program.
52.219-11 Special 8(a) Contract Conditions.
52.219-12 Special 8(a) Subcontract Conditions.
52.219-13 [Reserved]
52.219-14 Limitations on Subcontracting.
52.219-15 [Reserved]
52.219-16 Liquidated Damages--Subcontracting Plan.
52.219-17 Section 8(a) Award.
52.219-18 Notification of Competition Limited to Eligible 8(a) Concerns.
52.219-19 Small Business Concern Representation for the Small Business 
          Competitiveness Demonstration Program.
52.219-20 Notice of Emerging Small Business Set-Aside.
52.219-21 Small Business Size Representation for Targeted Industry 
          Categories Under the Small Business Competitiveness 
          Demonstration Program.
52.219-22 Small Disadvantaged Business Status.
52.219-23 Notice of Price Evaluation Adjustment for Small Disadvantaged 
          Business Concerns.
52.219-24 Small Disadvantaged Business Participation Program--Targets.
52.219-25 Small Disadvantaged Business Participation Program--
          Disadvantaged Status and Reporting.
52.219-26 Small Disadvantaged Business Participation Program--Incentive 
          Subcontracting.
52.221 [Reserved]
52.222-1 Notice to the Government of Labor Disputes.
52.222-2 Payment for Overtime Premiums.
52.222-3 Convict Labor.
52.222-4 Contract Work Hours and Safety Standards Act--Overtime 
          Compensation.
52.222-5 [Reserved]
52.222-6 Davis-Bacon Act.
52.222-7 Withholding of Funds.
52.222-8 Payrolls and Basic Records.
52.222-9 Apprentices and Trainees.
52.222-10 Compliance With Copeland Act Requirements.
52.222-11 Subcontracts (Labor Standards).
52.222-12 Contract Termination--Debarment.
52.222-13 Compliance With Davis-Bacon and Related Act Regulations.
52.222-14 Disputes Concerning Labor Standards.
52.222-15 Certification of Eligibility.
52.222-16 Approval of Wage Rates.
52.222-17 Labor Standards for Construction Work--Facilities Contracts.
52.222-18 Certification Regarding Knowledge of Child Labor for Listed 
          End Products.
52.222-19 Child Labor--Cooperation with Authorities and Remedies.
52.222-20 Walsh-Healey Public Contracts Act.
52.222-21 Prohibition of segregated facilities.
52.222-22 Previous Contracts and Compliance Reports.
52.222-23 Notice of Requirement for Affirmative Action to Ensure Equal 
          Employment Opportunity for Construction.
52.222-24 Preaward On-Site Equal Opportunity Compliance Evaluation.
52.222-25 Affirmative Action Compliance.
52.222-26 Equal Opportunity.
52.222-27 Affirmative Action Compliance Requirements for Construction.
52.222-28 [Reserved]

[[Page 8]]

52.222-29 Notification of visa denial.
52.222-30 Davis-Bacon Act--price adjustment (None or Separately 
          Specified Method).
52.222-31 Davis-Bacon Act--Price Adjustment (Percentage Method).
52.222-32 Davis-Bacon Act--Price Adjustment (Actual Method).
52.222-33--52.222-34 [Reserved]
52.222-35 Equal Opportunity for Special Disabled Veterans, Veterans of 
          the Vietnam Era, and Other Eligible Veterans.
52.222-36 Affirmative Action for Workers With Disabilities.
52.222-37 Employment Reports on Special Disabled Veterans, Veterans of 
          the Vietnam Era, and Other Eligible Veterans.
52.222-38 Compliance with Veterans' Employment Reporting Requirements.
52.222-39--52.222-40 [Reserved]
52.222-41 Service Contract Act of 1965, as Amended.
52.222-42 Statement of Equivalent Rates for Federal Hires.
52.222-43 Fair Labor Standards Act and Service Contract Act--Price 
          Adjustment (Multiple Year and Option Contracts).
52.222-44 Fair Labor Standards Act and Service Contract Act--Price 
          Adjustment.
52.222-45 [Reserved]
52.222-46 Evaluation of Compensation for Professional Employees.
52.222-47 SCA Minimum Wages and Fringe Benefits Applicable to Successor 
          Contract Pursuant to Predecessor Contractor Collective 
          Bargaining Agreements (CBA).
52.222-48 Exemption From Application of Service Contract Act Provisions 
          for Contracts for Maintenance, Calibration, and/or Repair of 
          Certain Information Technology, Scientific and Medical and/or 
          Office and Business Equipment--Contractor Certification.
52.222-49 Service Contract Act--Place of Performance Unknown.
52.222-50 [Reserved]
52.223-1--52.223-2 [Reserved]
52.223-3 Hazardous Material Identification and Material Safety Data.
52.223-4 Recovered Material Certification.
52.223-5 Pollution Prevention and Right-to-Know Information.
52.223-6 Drug-Free Workplace.
52.223-7 Notice of radioactive materials.
52.223-8 [Reserved]
52.223-9 Estimate of Percentage of Recovered Material Content for EPA-
          Designated Products.
52.223-10 Waste Reduction Program.
52.223-11 Ozone-Depleting Substances.
52.223-12 Refrigeration Equipment and Air Conditioners.
52.223-13 Certification of Toxic Chemical Release Reporting.
52.223-14 Toxic Chemical Release Reporting.
52.224-1 Privacy Act Notification.
52.224-2 Privacy Act.
52.225-1 Buy American Act--Supplies.
52.225-2 Buy American Act Certificate.
52.225-3 Buy American Act--North American Free Trade Agreement--Israeli 
          Trade Act.
52.225-4 Buy American Act--North American Free Trade Agreement--Israeli 
          Trade Act Certificate.
52.225-5 Trade Agreements.
52.225-6 Trade Agreements Certificate.
52.225-7 Waiver of Buy American Act for Civil Aircraft and Related 
          Articles.
52.225-8 Duty-Free Entry.
52.225-9 Buy American Act--Construction Materials.
52.225-10 Notice of Buy American Act Requirement-- Construction 
          Materials.
52.225-11 Buy American Act--Construction Materials under Trade 
          Agreements.
52.225-12 Notice of Buy American Act Requirement-- Construction 
          Materials under Trade Agreements.
52.225-13 Restrictions on Certain Foreign Purchases.
52.225-14 Inconsistency between English Version and Translation of 
          Contract.
52.225-15 Sanctioned European Union Country End Products.
52.225-16 Sanctioned European Union Country Services.
52.225-17 Evaluation of Foreign Currency Offers.
52.226 [Reserved]
52.226-1 Utilization of Indian Organizations and Indian-Owned Economic 
          Enterprises.
52.226-2 Historically Black College or University and Minority 
          Institution Representation.
52.227-1 Authorization and Consent.
52.227-2 Notice and Assistance Regarding Patent and Copyright 
          Infringement.
52.227-3 Patent Indemnity.
52.227-4 Patent Indemnity--Construction Contracts.
52.227-5 Waiver of Indemnity.
52.227-6 Royalty Information.
52.227-7 Patents--Notice of Government Licensee.
52.227-8 [Reserved]
52.227-9 Refund of Royalties.
52.227-10 Filing of Patent Applications--Classified Subject Matter.
52.227-11 Patent Rights--Retention by the Contractor (Short Form).
52.227-12 Patent Rights--Retention by the Contractor (Long Form).
52.227-13 Patent Rights--Acquisition by the Government.
52.227-14 Rights in Data--General.
52.227-15 Representation of Limited Rights Data and Restricted Computer 
          Software.
52.227-16 Additional Data Requirements.
52.227-17 Rights in Data--Special Works.
52.227-18 Rights in Data--Existing Works.
52.227-19 Commercial Computer Software--Restricted Rights.

[[Page 9]]

52.227-20 Rights in Data--SBIR Program.
52.227-21 Technical Data Declaration, Revision, and Withholding of 
          Payment--Major Systems.
52.227-22 Major System--Minimum Rights.
52.227-23 Rights to Proposal Data (Technical).
52.228-1 Bid Guarantee.
52.228-2 Additional Bond Security.
52.228-3 Workers' Compensation Insurance (Defense Base Act).
52.228-4 Workers' Compensation and War-Hazard Insurance Overseas.
52.228-5 Insurance--Work on a Government Installation.
52.228-6 [Reserved]
52.228-7 Insurance--Liability to Third Persons.
52.228-8 Liability and Insurance--Leased Motor Vehicles.
52.228-9 Cargo Insurance.
52.228-10 Vehicular and General Public Liability Insurance.
52.228-11 Pledges of Assets.
52.228-12 Prospective Subcontractor Requests for Bonds.
52.228-13 Alternative Payment Protections.
52.228-14 Irrevocable Letter of Credit.
52.228-15 Performance and Payment Bonds--Construction.
52.228-16 Performance and Payment Bonds--Other Than Construction.
52.229-1 State and Local Taxes.
52.229-2 North Carolina State and Local Sales and Use Tax.
52.229-3 Federal, State, and Local Taxes.
52.229-4 Federal, State, and Local (State and Local Adjustments).
52.229-5 [Reserved]
52.229-6 Taxes--Foreign Fixed-Price Contracts.
52.229-7 Taxes--Fixed-Price Contracts With Foreign Governments.
52.229-8 Taxes--Foreign Cost-Reimbursement Contracts.
52.229-9 Taxes--Cost-Reimbursement Contracts With Foreign Governments.
52.229-10 State of New Mexico Gross Receipts and Compensating Tax.
52.230-1 Cost Accounting Standards Notices and Certification.
52.230-2 Cost Accounting Standards.
52.230-3 Disclosure and Consistency of Cost Accounting Practices.
52.230-4 Consistency in Cost Accounting Practices.
52.230-5 Cost Accounting Standards--Educational Institution.
52.230-6 Administration of Cost Accounting Standards.
52.231 [Reserved]
52.232-1 Payments.
52.232-2 Payments Under Fixed-Price Research and Development Contracts.
52.232-3 Payments Under Personal Services Contracts.
52.232-4 Payments Under Transportation Contracts and Transportation-
          Related Services Contracts.
52.232-5 Payments Under Fixed-Price Construction Contracts.
52.232-6 Payment Under Communication Service Contracts With Common 
          Carriers.
52.232-7 Payments Under Time-and-Materials and Labor-Hour Contracts.
52.232-8 Discounts for Prompt Payment.
52.232-9 Limitation on Withholding of Payments.
52.232-10 Payments Under Fixed-Price Architect-Engineer Contracts.
52.232-11 Extras.
52.232-12 Advance Payments.
52.232-13 Notice of Progress Payments.
52.232-14 Notice of Availability of Progress Payments Exclusively for 
          Small Business Concerns.
52.232-15 Progress Payments Not Included.
52.232-16 Progress Payments.
52.232-17 Interest.
52.232-18 Availability of Funds.
52.232-19 Availability of Funds for the Next Fiscal Year.
52.232-20 Limitation of Cost.
52.232-21 Limitation of Cost (Facilities).
52.232-22 Limitation of Funds.
52.232-23 Assignment of Claims.
52.232-24 Prohibition of Assignment of Claims.
52.232-25 Prompt Payment.
52.232-26 Prompt Payment for Fixed-Price Architect-Engineer Contracts.
52.232-27 Prompt Payment for Construction Contracts.
52.232-28 Invitation to Propose Performance-Based Payments.
52.232-29 Terms for Financing of Purchases of Commercial Items.
52.232-30 Installment Payments for Commercial Items.
52.232-31 Invitation to Propose Financing Terms.
52.232-32 Performance-Based Payments.
52.232-33 Payment by Electronic Funds Transfer--Central Contractor 
          Registration.
52.232-34 Payment by Electronic Funds Transfer--Other than Central 
          Contractor Registration.
52.232-35 Designation of Office for Government Receipt of Electronic 
          Funds Transfer Information.
52.232-36 Payment by Third Party.
52.232-37 Multiple Payment Arrangements.
52.232-38 Submission of Electronic Funds Transfer Information with 
          Offer.
52.233-1 Disputes.
52.233-2 Service of Protest.
52.233-3 Protest After Award.
52.234-1 Industrial Resources Developed Under Defense Production Act 
          Title III.
52.235 [Reserved]

[[Page 10]]

52.236-1 Performance of Work by the Contractor.
52.236-2 Differing Site Conditions.
52.236-3 Site Investigation and Conditions Affecting the Work.
52.236-4 Physical Data.
52.236-5 Material and Workmanship.
52.236-6 Superintendence by the Contractor.
52.236-7 Permits and Responsibilities.
52.236-8 Other Contracts.
52.236-9 Protection of Existing Vegetation, Structures, Equipment, 
          Utilities, and Improvements.
52.236-10 Operations and Storage Areas.
52.236-11 Use and Possession Prior to Completion.
52.236-12 Cleaning Up.
52.236-13 Accident Prevention.
52.236-14 Availability and Use of Utility Services.
52.236-15 Schedules for Construction Contracts.
52.236-16 Quantity Surveys.
52.236-17 Layout of Work.
52.236-18 Work Oversight in Cost-Reimbursement Construction Contracts.
52.236-19 Organization and Direction of the Work.
52.236-20 [Reserved]
52.236-21 Specifications and Drawings for Construction.
52.236-22 Design Within Funding Limitations.
52.236-23 Responsibility of the Architect-Engineer Contractor.
52.236-24 Work Oversight in Architect-Engineer Contracts.
52.236-25 Requirements for Registration of Designers.
52.236-26 Preconstruction Conference.
52.236-27 Site Visit (Construction).
52.236-28 Preparation of Proposals--Construction.
52.237-1 Site Visit.
52.237-2 Protection of Government Buildings, Equipment, and Vegetation.
52.237-3 Continuity of Services.
52.237-4 Payment by Government to Contractor.
52.237-5 Payment by Contractor to Government.
52.237-6 Incremental Payment by Contractor to Government.
52.237-7 Indemnification and Medical Liability Insurance.
52.237-8 Restriction on Severance Payments to Foreign Nationals.
52.237-9 Waiver of Limitation on Severance Payments to Foreign 
          Nationals.
52.237-10 Identification of Uncompensated Overtime.
52.238 [Reserved]
52.239-1 Privacy or Security Safeguards.
52.240 [Reserved]
52.241 Utility Services Provisions and Clauses.
52.241-1 Electric Service Territory Compliance Representation.
52.241-2 Order of Precedence--Utilities.
52.241-3 Scope and Duration of Contract.
52.241-4 Change in Class of Service.
52.241-5 Contractor's Facilities.
52.241-6 Service Provisions.
52.241-7 Change in Rates or Terms and Conditions of Service for 
          Regulated Services.
52.241-8 Change in Rates or Terms and Conditions of Service for 
          Unregulated Services.
52.241-9 Connection Charge.
52.241-10 Termination Liability.
52.241-11 Multiple Service Locations.
52.241-12 Nonrefundable, Nonrecurring Service Charge.
52.241-13 Capital Credits.
52.242-1 Notice of Intent to Disallow Costs.
52.242-2 Production Progress Reports.
52.242-3 Penalties for Unallowable Costs.
52.242-4 Certification of Final Indirect Costs.
52.242-5--52.242-9 [Reserved]
52.242-10 F.o.b. Origin--Government Bills of Lading or Prepaid Postage.
52.242-11 F.o.b. Origin--Government Bills of Lading or Indicia Mail.
52.242-12 Report of Shipment (REPSHIP).
52.242-13 Bankruptcy.
52.242-14 Suspension of Work.
52.242-15 Stop-Work Order.
52.242-16 Stop-Work Order--Facilities.
52.242-17 Government Delay of Work.
52.243-1 Changes--Fixed-Price.
52.243-2 Changes--Cost-Reimbursement.
52.243-3 Changes--Time-and-Materials or Labor-Hours.
52.243-4 Changes.
52.243-5 Changes and Changed Conditions.
52.243-6 Change Order Accounting.
52.243-7 Notification of Changes.
52.244-1 [Reserved]
52.244-2 Subcontracts.
52.244-3 [Reserved]
52.244-4 Subcontractors and outside associates and consultants 
          (Architect-engineer services).
52.244-5 Competition in Subcontracting.
52.244-6 Subcontracts for Commercial Items.
52.245-1 Property Records.
52.245-2 Government Property (Fixed-Price Contracts).
52.245-3 Identification of Government-Furnished Property.
52.245-4 Government-Furnished Property (Short Form).
52.245-5 Government Property (Cost-Reimbursement, Time-and-Material, or 
          Labor-Hour Contracts).
52.245-6 Liability for Government Property (Demolition Services 
          Contracts).
52.245-7 Government Property (Consolidated Facilities).
52.245-8 Liability for the Facilities.
52.245-9 Use and Charges.

[[Page 11]]

52.245-10 Government Property (Facilities Acquisition).
52.245-11 Government Property (Facilities Use).
52.245-12 Contract Purpose (Nonprofit Educational Institutions).
52.245-13 Accountable Facilities (Nonprofit Educational Institutions).
52.245-14 Use of Government Facilities.
52.245-15 Transfer of Title to the Facilities.
52.245-16 Facilities Equipment Modernization.
52.245-17 Special Tooling.
52.245-18 Special Test Equipment.
52.245-19 Government Property Furnished ``As Is.''
52.246-1 Contractor Inspection Requirements.
52.246-2 Inspection of Supplies--Fixed-Price.
52.246-3 Inspection of Supplies--Cost-Reimbursement.
52.246-4 Inspection of Services--Fixed-Price.
52.246-5 Inspection of Services--Cost-Reimbursement.
52.246-6 Inspection--Time-and-Material and Labor-Hour.
52.246-7 Inspection of Research and Development--Fixed-Price.
52.246-8 Inspection of Research and Development--Cost-Reimbursement.
52.246-9 Inspection of Research and Development (Short Form).
52.246-10 Inspection of Facilities.
52.246-11 Higher-Level Contract Quality Requirement.
52.246-12 Inspection of Construction.
52.246-13 Inspection--Dismantling, Demolition, or Removal of 
          Improvements.
52.246-14 Inspection of Transportation.
52.246-15 Certificate of Conformance.
52.246-16 Responsibility for Supplies.
52.246-17 Warranty of Supplies of a Noncomplex Nature.
52.246-18 Warranty of Supplies of a Complex Nature.
52.246-19 Warranty of Systems and Equipment under Performance 
          Specifications or Design Criteria.
52.246-20 Warranty of Services.
52.246-21 Warranty of Construction.
52.246-22 [Reserved]
52.246-23 Limitation of Liability.
52.246-24 Limitation of Liability--High-Value Items.
52.246-25 Limitation of Liability--Services.
52.247-1 Commercial Bill of Lading Notations.
52.247-2 Permits, Authorities, or Franchises.
52.247-3 Capability to Perform a Contract for the Relocation of a 
          Federal Office.
52.247-4 Inspection of Shipping and Receiving Facilities.
52.247-5 Familiarization With Conditions.
52.247-6 Financial Statement.
52.247-7 Freight Excluded.
52.247-8 Estimated Weights or Quantities Not Guaranteed.
52.247-9 Agreed Weight--General Freight.
52.247-10 Net Weight--General Freight.
52.247-11 Net Weight--Household Goods or Office Furniture.
52.247-12 Supervision, Labor, or Materials.
52.247-13 Accessorial Services--Moving Contracts.
52.247-14 Contractor Responsibility for Receipt of Shipment.
52.247-15 Contractor Responsibility for Loading and Unloading.
52.247-16 Contractor Responsibility for Returning Undelivered Freight.
52.247-17 Charges.
52.247-18 Multiple Shipments.
52.247-19 Stopping in Transit for Partial Unloading.
52.247-20 Estimated Quantities or Weights for Evaluation of Offers.
52.247-21 Contractor Liability for Personal Injury and/or Property 
          Damage.
52.247-22 Contractor Liability for Loss of and/or Damage to Freight 
          Other Than Household Goods.
52.247-23 Contractor Liability for Loss of and/or Damage to Household 
          Goods.
52.247-24 Advance Notification by the Government.
52.247-25 Government-Furnished Equipment With or Without Operators.
52.247-26 Government Direction and Marking.
52.247-27 Contract Not Affected by Oral Agreement.
52.247-28 Contractor's Invoices.
52.247-29 F.o.b. Origin.
52.247-30 F.o.b. Origin, Contractor's Facility.
52.247-31 F.o.b. Origin, Freight Allowed.
52.247-32 F.o.b. Origin, Freight Prepaid.
52.247-33 F.o.b. Origin, With Differentials.
52.247-34 F.o.b. Destination.
52.247-35 F.o.b. Destination, Within Consignee's Premises.
52.247-36 F.a.s. Vessel, Port of Shipment.
52.247-37 F.o.b. Vessel, Port of Shipment.
52.247-38 F.o.b. Inland Carrier, Point of Exportation.
52.247-39 F.o.b. Inland Point, Country of Importation.
52.247-40 Ex Dock, Pier, or Warehouse, Port of Importation.
52.247-41 C.& f. Destination.
52.247-42 C.i.f. Destination.
52.247-43 F.o.b. Designated Air Carrier's Terminal, Point of 
          Exportation.
52.247-44 F.o.b. Designated Air Carrier's Terminal, Point of 
          Importation.
52.247-45 F.o.b. Origin and/or F.o.b. Destination Evaluation.
52.247-46 Shipping Point(s) Used in Evaluation of F.o.b. Origin Offers.
52.247-47 Evaluation--F.o.b. Origin.
52.247-48 F.o.b. Destination--Evidence of Shipment.

[[Page 12]]

52.247-49 Destination Unknown.
52.247-50 No Evaluation of Transportation Costs.
52.247-51 Evaluation of Export Offers.
52.247-52 Clearance and Documentation Requirements--Shipments to DOD Air 
          or Water Terminal Transshipment Points.
52.247-53 Freight Classification Description.
52.247-54 [Reserved]
52.247-55 F.o.b. Point for Delivery of Government-Furnished Property.
52.247-56 Transit Arrangements.
52.247-57 Transportation Transit Privilege Credits.
52.247-58 Loading, Blocking, and Bracing of Freight Car Shipments.
52.247-59 F.o.b. Origin--Carload and Truckload Shipments.
52.247-60 Guaranteed Shipping Characteristics.
52.247-61 F.o.b. Origin--Minimum Size of Shipments.
52.247-62 Specific Quantities Unknown.
52.247-63 Preference for U.S.-Flag Air Carriers.
52.247-64 Preference for Privately Owned U.S.-Flag Commercial Vessels.
52.247-65 F.o.b. Origin, Prepaid Freight--Small Package Shipments.
52.247-66 Returnable Cylinders.
52.247-67 Submission of Commercial Transportation Bills to the General 
          Services Administration for Audit.
52.248-1 Value Engineering.
52.248-2 Value Engineering--Architect-Engineer.
52.248-3 Value Engineering--Construction.
52.249-1 Termination for Convenience of the Government (Fixed-Price) 
          (Short Form).
52.249-2 Termination for Convenience of the Government (Fixed-Price).
52.249-3 Termination for Convenience of the Government (Dismantling, 
          Demolition, or Removal of Improvements).
52.249-4 Termination for Convenience of the Government (Services) (Short 
          Form).
52.249-5 Termination for Convenience of the Government (Educational and 
          Other Nonprofit Institutions).
52.249-6 Termination (Cost-Reimbursement).
52.249-7 Termination (Fixed-Price Architect-Engineer).
52.249-8 Default (Fixed-Price Supply and Service).
52.249-9 Default (Fixed-Price Research and Development).
52.249-10 Default (Fixed-Price Construction).
52.249-11 Termination of Work (Consolidated Facilities or Facilities 
          Acquisition).
52.249-12 Termination (Personal Services).
52.249-13 Failure to Perform.
52.249-14 Excusable Delays.
52.250-1 Indemnification Under Public Law 85-804.
52.251-1 Government Supply Sources.
52.251-2 Interagency Fleet Management System Vehicles and Related 
          Services.
52.252-1 Solicitation Provisions Incorporated by Reference.
52.252-2 Clauses Incorporated by Reference.
52.252-3 Alterations in Solicitation.
52.252-4 Alterations in Contract.
52.252-5 Authorized Deviations in Provisions.
52.252-6 Authorized Deviations in Clauses.
52.253-1 Computer Generated Forms.

                Subpart 52.3_Provision and Clause Matrix

52.300 Scope of subpart.
52.301 Solicitation provisions and contract clauses (Matrix).

    Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42 U.S.C. 
2473(c).

    Source: 48 FR 42478, Sept. 19, 1983, unless otherwise noted.

    Editorial Note: For a document removing derivation lines wherever 
they appeared in part 52, see 60 FR 48218, Sept. 18, 1995.



Sec.  52.000  Scope of part.

    This part (a) gives instructions for using provisions and clauses in 
solicitations and/or contracts, (b) sets forth the solicitation 
provisions and contract clauses prescribed by this regulation, and (c) 
presents a matrix listing the FAR provisions and clauses applicable to 
each principal contract type and/or purpose (e.g., fixed-price supply, 
cost-reimbursement research and development).

[48 FR 42478, Sept. 19, 1983; 48 FR 43273, Sept. 22, 1983, as amended at 
55 FR 3887, Feb. 5, 1990]



       Subpart 52.1_Instructions for Using Provisions and Clauses



Sec.  52.100  Scope of subpart.

    This subpart (a) gives instructions for using part 52, including the 
explanation and use of provision and clause numbers, prescriptions, 
prefaces, and the matrix; (b) prescribes procedures for incorporating, 
identifying, and modifying provisions and clauses in solicitations and 
contracts, and for using alternates; and (c) describes the derivation of 
FAR provisions and clauses.

[48 FR 42478, Sept. 19, 1983; 48 FR 43273, Sept. 22, 1983, as amended at 
55 FR 3887, Feb. 5, 1990]

[[Page 13]]



Sec.  52.101  Using part 52.

    (a) Definition.
    Modification, as used in this subpart, means a minor change in the 
details of a provision or clause that is specifically authorized by the 
FAR and does not alter the substance of the provision or clause (see 
52.104).
    (b) Numbering. (1) FAR provisions and clauses. Subpart 52.2 sets 
forth the texts of all FAR provisions and clauses, each in its own 
separate subsection. The subpart is arranged by subject matter, in the 
same order as, and keyed to, the parts of the FAR. Each FAR provision or 
clause is uniquely identified. All FAR provision and clause numbers 
begin with ``52.2,'' since the text of all FAR provisions and clauses 
appear in subpart 52.2. The next two digits of the provision or clause 
number correspond to the number of the FAR subject part in which the 
provision or clause is prescribed. The FAR provision or clause number is 
then completed by a hyphen and a sequential number assigned within each 
section of subpart 52.2. The following example illustrates the makeup of 
the FAR provision or clause number:
[GRAPHIC] [TIFF OMITTED] TC01MY91.000

    (2) Provisions or clauses that supplement the FAR.
    (i) Provisions or clauses that supplement the FAR are--
    (A) Prescribed and included in authorized agency acquisition 
regulations issued within an agency to satisfy the specific needs of the 
agency as a whole;
    (B) Prescribed and included in a regulation issued by a 
suborganization of an agency to satisfy the needs of that particular 
suborganization; or
    (C) Developed for use at a suborganizational level of an agency, not 
meant for repetitive use, but intended to meet the needs of an 
individual acquisiton and, thus, impractical to include in either an 
agency or suborganization acquisition regulation. (See 1.301(c).)
    (ii) Supplemental provisions or clauses published in agency 
acquisition regulations shall be in full text and the prescription for 
the use of each shall be included. Supplemental provisions or clauses 
published in agency acquisition regulations shall be numbered in the 
same manner in which FAR provisions and clauses are numbered except 
that--
    (A) If it is included in an agency acquisition regulation that is 
published in the Federal Register and is codified in Title 48, Code of 
Federal Regulations (48 CFR), the number shall be preceded by the 
chapter number within 48 CFR assigned by the CFR staff; and
    (B) The sequential number shall be ``70'' or a higher number (see 
1.303).
    (iii) The sequential number at the end of the number of a provision 
or clause that supplements the FAR, like its counterpart at the end of 
any FAR provision or clause number, indicates the subsection location of 
the provision or clause in subpart 52.2 of the agency acquisition 
regulation that contains its full text. If, for example, an agency 
acquisition regulation contains only one provision followed by only one 
clause supplementing the FAR in its section 52.236 (Construction and 
Architect-Engineer Contracts), then the sequential numbers would be 
``70'' for the provision and ``71'' for the clause.
    (c) Prescriptions. Each provision or clause in subpart 52.2 is 
prescribed at that place in the FAR text where the subject matter of the 
provision or clause receives its primary treatment. The prescription 
includes all conditions, requirements, and instructions for using the 
provision or clause and its alternates, if any. The provision or clause 
may be referred to in other FAR locations.
    (d) Introductory text. Within subpart 52.2, the introductory text of 
each provision or clause includes a cross-reference to the location in 
the FAR subject text that prescribes its use.
    (e) Matrix. (1) The matrix in subpart 52.3 contains a column for 
each principal type and/or purpose of contract (e.g., fixed-price 
supply, cost reimbursement research and development). The matrix lists 
the--
    (i) Required solicitation provisions;

[[Page 14]]

    (ii) Required-when-applicable solicitation provisions;
    (iii) Optional solicitation provisions;
    (iv) Required contract clauses;
    (v) Required-when-applicable contract clauses; and
    (vi) Optional contract clauses.
    (2) For each provision or clause listed, the matrix provides 
information on--
    (i) Whether incorporation by reference is or is not authorized (see 
52.102);
    (ii) The section of the Uniform Contract Format (UCF) in which it is 
to be located, if it is used in an acquisition that is subject to the 
UCF;
    (iii) Its number;
    (iv) The citation of the FAR text that prescribes its use; and
    (v) Its title.
    (3) Since the matrix does not provide sufficient information to 
determine the applicability of a provision or clause in the ``required-
when-applicable'' and ``optional'' categories, contracting officers 
shall refer to the FAR text (cited in the matrix) that prescribes its 
use.
    (4) The FAR matrix may be reproduced at agency levels, and at 
subordinate levels, for the purpose of supplementing it with agency-
developed provisions and clauses. The resulting consolidated matrices 
may be included in agency acquisition regulations.
    (f) Dates. Since they are subject to revision from time to time, all 
provisions, clauses, and alternates are dated; e.g., (DEC 1983). To 
avoid questions concerning which version of any provision, clause, or 
alternate is operative in any given solicitation or contract, its date 
shall be included whether it is incorporated by reference or in full 
text.

[48 FR 42478, Sept. 19, 1983; 48 FR 43273, Sept. 22, 1983, as amended at 
55 FR 3887, Feb. 5, 1990; 62 FR 40237, July 25, 1997; 62 FR 64927, Dec. 
9, 1997; 65 FR 36016, June 6, 2000; 66 FR 2134, Jan. 10, 2001]



Sec.  52.102  Incorporating provisions and clauses.

    (a) Provisions and clauses should be incorporated by reference to 
the maximum practical extent, rather than being incorporated in full 
text, even if they--
    (1) Are used with one or more alternates or on an optional basis;
    (2) Are prescribed on a ``substantially as follows'' or 
``substantially the same as'' basis, provided they are used verbatim;
    (3) Require modification or the insertion by the Government of fill-
in material (see 52.104); or
    (4) Require completion by the offeror or prospective contractor. 
This instruction also applies to provisions completed as annual 
representations and certifications.
    (b) Except for provisions and clauses prescribed in 52.107, any 
provision or clause that can be accessed electronically by the offeror 
or prospective contractor may be incorporated by reference in 
solicitations and/or contracts. However, the contracting officer, upon 
request, shall provide the full text of any provision or clause 
incorporated by reference.
    (c) Agency approved provisions and clauses prescribed in agency 
acquisition regulations, and provisions and clauses not authorized by 
subpart 52.3 to be incorporated by reference, need not be incorporated 
in full text, provided the contracting officer includes in the 
solicitation and contract a statement that--
    (1) Identifies all provisions and clauses that require completion by 
the offeror or prospective contractor;
    (2) Specifies that the provisions and clauses must be completed by 
the offeror or prospective contractor and must be submitted with the 
quotation or offer; and
    (3) Identifies to the offeror or prospective contractor at least one 
electronic address where the full text may be accessed.
    (d) An agency may develop a group listing of provisions and clauses 
that apply to a specific category of contracts. An agency group listing 
may be incorporated by reference in solicitations and/or contracts in 
lieu of citing the provisions and clauses individually, provided the 
group listing is made available electronically to offerors and 
prospective contractors.
    (e) A provision or clause that is not available electronically to 
offerors and

[[Page 15]]

prospective contractors shall be incorporated in solicitations and/or 
contracts in full text if it is--
    (1) A FAR provision or clause that otherwise is not authorized to be 
incorporated by reference (see subpart 52.3); or
    (2) A provision or clause prescribed for use in an agency 
acquisition regulation.
    (f) Provisions or clauses may not be incorporated by reference by 
being listed in the--
    (1) Provision at 52.252-3, Alterations in Solicitations; or
    (2) Clause at 52.252-4, Alterations in Contract.

[62 FR 64927, Dec. 9, 1997]



Sec.  52.103  Identification of provisions and clauses.

    (a) Whenever any FAR provision or clause is used without deviation 
in a solicitation or contract, whether it is incorporated by reference 
or in full text, it shall be identified by number, title, and date. This 
identification shall also be used if the FAR provision or clause is used 
with an authorized deviation, except that the contracting officer shall 
then insert ``(DEVIATION)'' after the date. Solicited firms and 
contractors will be advised of the meaning of this insertion through the 
use of the (1) provision at 52.252-5, Authorized Deviations in 
Provisions, or (2) clause at 52.252-6, Authorized Deviations in Clauses. 
The above mentioned provision and clause are prescribed in 52.107 (e) 
and (f).
    (b) Any provision or clause that supplements the FAR whether it is 
incorporated by reference or in full text shall be clearly identified by 
number, title, date, and name of the regulation. When a supplemental 
provision or clause is used with an authorized deviation, insert 
``(DEVIATION)'' after the name of the regulation.
    (c) A provision or clause of the type described in 
52.101(b)(2)(i)(C) shall be identified by the title, date, and the name 
of the agency or suborganization within the agency that developed it.
    (d) Except for provisions or clauses covered by 52.103(c), the 
following hypothetical examples illustrate how a provision or clause 
that supplements the FAR shall be identified when it is incorporated in 
solicitations and/or contracts by reference or in full text:
    (1) If part 14 (Sealed Bidding) of the X Agency Acquisition 
Regulation, published in the Federal Register and codified as Chapter 99 
in 48 CFR, prescribes the use of a provision entitled ``Bid Envelopes,'' 
dated October 1983, and that provision is sequentially the first 
provision or clause appearing in Section 52.214 of the X Agency 
Acquisition Regulation, then the identification of that provision shall 
be ``9952.214-70--Bid Envelopes (OCT 1983).''
    (2) Assume that Y, a major organizational element of the X Agency, 
is authorized to issue the Y Acquisition Regulation, which is not 
published in the Federal Register and codified in 48 CFR. If part 36 
(Construction and Architect-Engineer Contracts) of the Y Acquisition 
Regulation prescribes the use of a clause entitled ``Refrigerated 
Display Cases,'' dated March 1983, pertaining to a specialized type of 
construction work, and that clause is sequentially the second provision 
or clause appearing in Section 52.236 of the Y Acquisition Regulation, 
then the identification of that clause shall be ``52.236-71--
Refrigerated Display Cases (MAR 1983)--Y Acquisition Regulation.''

[48 FR 42478, Sept. 19, 1983, as amended at 52 FR 9039, Mar. 20, 1987]



Sec.  52.104  Procedures for modifying and completing provisions and clauses.

    (a) The contracting officer must not modify provisions and clauses 
unless the FAR authorizes their modification. For example--
    (1) ``The contracting officer may use a period shorter than 60 days 
(but not less than 30 days) in paragraph (x) of the clause''; or
    (2) ``The contracting officer may substitute the words `task order' 
for the word `Schedule' wherever that word appears in the clause.''
    (b) When modifying provisions or clauses incorporated by reference, 
insert the changed wording directly below the title of the provision or 
clause identifying to the lowest level necessary (e.g., paragraph, 
sentence, word), to clearly indicate what is being modified.

[[Page 16]]

    (c) When modifying provisions or clauses incorporated in full text, 
modify the language directly by substituting the changed wording as 
permitted.
    (d) When completing blanks in provisions or clauses incorporated by 
reference, insert the fill-in information directly below the title of 
the provision or clause identifying to the lowest level necessary to 
clearly indicate the blanks being filled in.
    (e) When completing blanks in provisions or clauses incorporated in 
full text, insert the fill-in information in the blanks of the provision 
or clause.

[48 FR 42478, Sept. 19, 1983, as amended at 65 FR 36016, June 6, 2000]



Sec.  52.105  Procedures for using alternates.

    (a) The FAR accommodates a major variation in a provision or clause 
by use of an alternate. The FAR prescribes alternates to a given 
provision or clause in the FAR subject text where the provision or 
clause is prescribed. The alternates to each provision or clause are 
titled ``Alternate I,'' ``Alternate II,'' ``Alternate III,'' etc.
    (b) When an alternate is used, its date shall be cited along with 
the date of the basic provision or clause; e.g., 52.209-3 FIRST ARTICLE 
APPROVAL--CONTRACTOR TESTING (OCT 1983)--ALTERNATE I (DEC 1983).
    (c) Under certain circumstances, a provision or clause may be used 
with two or more alternates. In these circumstances, each of the 
applicable alternates shall be cited, whether incorporated by reference 
or in full text; e.g., 52.209-3 FIRST ARTICLE APPROVAL--CONTRACTOR 
TESTING (OCT 1983)--ALTERNATE I (DEC 1983) AND ALTERNATE II (FEB 1984). 
However, under no circumstances may an alternate to a specific provision 
or clause be applied to any other provision or clause.

[48 FR 42478, Sept. 19, 1983, as amended at 65 FR 36016, June 6, 2000]



Sec.  52.106  [Reserved]



Sec.  52.107  Provisions and clauses prescribed in subpart 52.1.

    (a) The contracting officer shall insert the provision at 52.252-1, 
Solicitation Provisions Incorporated by Reference, in solicitations in 
order to incorporate provisions by reference.
    (b) The contracting officer shall insert the clause at 52.252-2, 
Clauses Incorporated by Reference, in solicitations and contracts in 
order to incorporate clauses by reference.
    (c) The contracting officer shall insert the provision at 52.252-3, 
Alterations in Solicitation, in solicitations in order to revise or 
supplement, as necessary, other parts of the solicitation that apply to 
the solicitation phase only, except for any provision authorized for use 
with a deviation.
    (d) The contracting officer shall insert the clause at 52.252-4, 
Alterations in Contract, in solicitations and contracts in order to 
revise or supplement, as necessary, other parts of the contract, or 
parts of the solicitations that apply to the contract phase, except for 
any clause authorized for use with a deviation.
    (e) The contracting officer shall insert the provision at 52.252-5, 
Authorized Deviations in Provisions, in solicitations that include any 
FAR or supplemental provision with an authorized deviation. Whenever any 
FAR or supplemental provision is used with an authorized deviation, the 
contracting officer shall identify it by the same number, title, and 
date assigned to the provision when it is used without deviation, 
include regulation name for any supplemental provision, except that the 
contracting officer shall insert ``(DEVIATION)'' after the date of the 
provision.
    (f) The contracting officer shall insert the clause at 52.252-6, 
Authorized Deviations in Clauses, in solicitations and contracts that 
include any FAR or supplemental clause with an authorized deviation. 
Whenever any FAR or supplemental clause is used with an authorized 
deviation, the contracting officer shall identify it by the same number, 
title, and date assigned to the clause when it is used without 
deviation, include regulation name for any supplemental clause, except 
that the contracting officer shall insert ``(DEVIATION)'' after the date 
of the clause.

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 48990, Nov. 28, 1989]

[[Page 17]]



               Subpart 52.2_Text of Provisions and Clauses



Sec.  52.200  Scope of subpart.

    This subpart sets forth the text of all FAR provisions and clauses 
(see 52.101(b)(1)) and gives a cross-reference to the location in the 
FAR that prescribes the provision or clause.

[65 FR 36016, June 6, 2000]



Sec.  52.201  [Reserved]



Sec.  52.202-1  Definitions.

    As prescribed in section 2.201, insert the following clause:

                         Definitions (DEC 2001)

    (a) Agency head or head of the agency means the Secretary (Attorney 
General, Administrator, Governor, Chairperson, or other chief official, 
as appropriate) of the agency, unless otherwise indicated, including any 
deputy or assistant chief official of the executive agency.
    (b) Commercial component means any component that is a commercial 
item.
    (c) Commercial item means--
    (1) Any item, other than real property, that is of a type 
customarily used by the general public or by non-governmental entities 
for purposes other than governmental purposes, and that--
    (i) Has been sold, leased, or licensed to the general public; or
    (ii) Has been offered for sale, lease, or license to the general 
public;
    (2) Any item that evolved from an item described in paragraph (c)(1) 
of this clause through advances in technology or performance and that is 
not yet available in the commercial marketplace, but will be available 
in the commercial marketplace in time to satisfy the delivery 
requirements under a Government solicitation;
    (3) Any item that would satisfy a criterion expressed in paragraphs 
(c)(1) or (c)(2) of this clause, but for--
    (i) Modifications of a type customarily available in the commercial 
marketplace; or
    (ii) Minor modifications of a type not customarily available in the 
commercial marketplace made to meet Federal Government requirements. 
Minor modifications means modifications that do not significantly alter 
the nongovernmental function or essential physical characteristics of an 
item or component, or change the purpose of a process. Factors to be 
considered in determining whether a modification is minor include the 
value and size of the modification and the comparative value and size of 
the final product. Dollar values and percentages may be used as 
guideposts, but are not conclusive evidence that a modification is 
minor;
    (4) Any combination of items meeting the requirements of paragraphs 
(c)(1), (2), (3), or (5) of this clause that are of a type customarily 
combined and sold in combination to the general public;
    (5) Installation services, maintenance services, repair services, 
training services, and other services if--
    (i) Such services are procured for support of an item referred to in 
paragraph (c)(1), (2), (3), or (4) of this definition, regardless of 
whether such services are provided by the same source or at the same 
time as the item; and
    (ii) The source of such services provides similar services 
contemporaneously to the general public under terms and conditions 
similar to those offered to the Federal Government;
    (6) Services of a type offered and sold competitively in substantial 
quantities in the commercial marketplace based on established catalog or 
market prices for specific tasks performed under standard commercial 
terms and conditions. This does not include services that are sold based 
on hourly rates without an established catalog or market price for a 
specific service performed. For purposes of these services--
    (i) Catalog price means a price included in a catalog, price list, 
schedule, or other form that is regularly maintained by the manufacturer 
or vendor, is either published or otherwise available for inspection by 
customers, and states prices at which sales are currently, or were last, 
made to a significant number of buyers constituting the general public; 
and
    (ii) Market prices means current prices that are established in the 
course of ordinary trade between buyers and sellers free to bargain and 
that can be substantiated through competition or from sources 
independent of the offerors.
    (7) Any item, combination of items, or service referred to in 
subparagraphs (c)(1) through (c)(6), notwithstanding the fact that the 
item, combination of items, or service is transferred between or among 
separate divisions, subsidiaries, or affiliates of a Contractor; or
    (8) A nondevelopmental item, if the procuring agency determines the 
item was developed exclusively at private expense and sold in 
substantial quantities, on a competitive basis, to multiple State and 
local Governments.
    (d) Component means any item supplied to the Government as part of 
an end item or of another component, except that for use in 52.225-9, 
and 52.225-11 see the definitions in 52.225-9(a) and 52.225-11(a).
    (e) Contracting Officer means a person with the authority to enter 
into, administer, and/

[[Page 18]]

or terminate contracts and make related determinations and findings. The 
term includes certain authorized representatives of the Contracting 
Officer acting within the limits of their authority as delegated by the 
Contracting Officer.
    (f) Nondevelopmental item means--
    (1) Any previously developed item of supply used exclusively for 
governmental purposes by a Federal agency, a State or local government, 
or a foreign government with which the United States has a mutual 
defense cooperation agreement;
    (2) Any item described in paragraph (f)(1) of this definition that 
requires only minor modification or modifications of a type customarily 
available in the commercial marketplace in order to meet the 
requirements of the procuring department or agency; or
    (3) Any item of supply being produced that does not meet the 
requirements of paragraph (f)(1) or (f)(2) solely because the item is 
not yet in use.
    (g) Except as otherwise provided in this contract, the term 
subcontracts includes, but is not limited to, purchase orders and 
changes and modifications to purchase orders under this contract.

                             (End of clause)

    Alternate I (MAY 2001). If the contract is for personal services; 
construction; architect-engineer services; or dismantling, demolition, 
or removal of improvements, delete paragraph (g) of the basic clause.

[48 FR 42478, Sept. 19, 1983, as amended at 56 FR 41730, 41744, Aug. 22, 
1991; 56 FR 67137, Dec. 27, 1991; 60 FR 48250, Sept. 18, 1995; 66 FR 
2134, Jan. 10, 2001; 66 FR 53484, Oct. 22, 2001; 67 FR 43520, June 27, 
2002]



Sec.  52.203-1  [Reserved]



Sec.  52.203-2  Certificate of Independent Price Determination.

    As prescribed in 3.103-1, insert the following provision. If the 
solicitation is a Request for Quotations, the terms Quotation and Quoter 
may be substituted for Offer and Offeror.

        Certificate of Independent Price Determination (APR 1985)

    (a) The offeror certifies that--
    (1) The prices in this offer have been arrived at independently, 
without, for the purpose of restricting competition, any consultation, 
communication, or agreement with any other offeror or competitor 
relating to (i) those prices, (ii) the intention to submit an offer, or 
(iii) the methods or factors used to calculate the prices offered;
    (2) The prices in this offer have not been and will not be knowingly 
disclosed by the offeror, directly or indirectly, to any other offeror 
or competitor before bid opening (in the case of a sealed bid 
solicitation) or contract award (in the case of a negotiated 
solicitation) unless otherwise required by law; and
    (3) No attempt has been made or will be made by the offeror to 
induce any other concern to submit or not to submit an offer for the 
purpose of restricting competition.
    (b) Each signature on the offer is considered to be a certification 
by the signatory that the signatory--
    (1) Is the person in the offeror's organization responsible for 
determining the prices being offered in this bid or proposal, and that 
the signatory has not participated and will not participate in any 
action contrary to subparagraphs (a)(1) through (a)(3) above; or
    (2)(i) Has been authorized, in writing, to act as agent for the 
following principals in certifying that those principals have not 
participated, and will not participate in any action contrary to 
subparagraphs (a)(1)
through (a)(3) above____________________________________________________
________________________________________________________________________
[insert full name of person(s) in the offeror's organization responsible 
for determining the prices offered in this bid or proposal, and the 
title of his or her position in the offeror's organization];
    (ii) As an authorized agent, does certify that the principals named 
in subdivision (b)(2)(i) above have not participated, and will not 
participate, in any action contrary to subparagraphs (a)(1) through 
(a)(3) above; and
    (iii) As an agent, has not personally participated, and will not 
participate, in any action contrary to subparagraphs (a)(1) through 
(a)(3) above.
    (c) If the offeror deletes or modifies subparagraph (a)(2) above, 
the offeror must furnish with its offer a signed statement setting forth 
in detail the circumstances of the disclosure.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 1746, Jan. 11, 1985; 
50 FR 52429, Dec. 23, 1985]



Sec.  52.203-3  Gratuities.

    As prescribed in 3.202, insert the following clause:

                          Gratuities (APR 1984)

    (a) The right of the Contractor to proceed may be terminated by 
written notice if, after notice and hearing, the agency head or a 
designee determines that the Contractor, its agent, or another 
representative--

[[Page 19]]

    (1) Offered or gave a gratuity (e.g., an entertainment or gift) to 
an officer, official, or employee of the Government; and
    (2) Intended, by the gratuity, to obtain a contract or favorable 
treatment under a contract.
    (b) The facts supporting this determination may be reviewed by any 
court having lawful jurisdiction.
    (c) If this contract is terminated under paragraph (a) above, the 
Government is entitled--
    (1) To pursue the same remedies as in a breach of the contract; and
    (2) In addition to any other damages provided by law, to exemplary 
damages of not less than 3 nor more than 10 times the cost incurred by 
the Contractor in giving gratuities to the person concerned, as 
determined by the agency head or a designee. (This subparagraph (c)(2) 
is applicable only if this contract uses money appropriated to the 
Department of Defense.)
    (d) 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 or under this contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 39200, July 26, 1996]



Sec.  52.203-4  [Reserved]



Sec.  52.203-5  Covenant Against Contingent Fees.

    As prescribed in 3.404, insert the following clause:

               Covenant Against Contingent Fees (APR 1984)

    (a) The Contractor warrants that no person or agency has been 
employed or retained to solicit or obtain this contract upon an 
agreement or understanding for a contingent fee, except a bona fide 
employee or agency. For breach or violation of this warranty, the 
Government shall have the right to annul this contract without liability 
or, in its discretion, to deduct from the contract price or 
consideration, or otherwise recover, the full amount of the contingent 
fee.
    (b) Bona fide agency, as used in this clause, means an established 
commercial or selling agency, maintained by a contractor for the purpose 
of securing business, that neither exerts nor proposes to exert improper 
influence to solicit or obtain Government contracts nor holds itself out 
as being able to obtain any Government contract or contracts through 
improper influence.
    Bona fide employee, as used in this clause, means a person, employed 
by a contractor and subject to the contractor's supervision and control 
as to time, place, and manner of performance, who neither exerts nor 
proposes to exert improper influence to solicit or obtain Government 
contracts nor holds out as being able to obtain any Government contract 
or contracts through improper influence.
    Contingent fee, as used in this clause, means any commission, 
percentage, brokerage, or other fee that is contingent upon the success 
that a person or concern has in securing a Government contract.
    Improper influence, as used in this clause, means any influence that 
induces or tends to induce a Government employee or officer to give 
consideration or to act regarding a Government contract on any basis 
other than the merits of the matter.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 56 FR 41730, Aug. 22, 1991; 
61 FR 39189, July 26, 1996]



Sec.  52.203-6  Restrictions on Subcontractor Sales to the Government.

    As prescribed in 3.503-2, insert the following clause:

    Restrictions on Subcontractor Sales to the Government (JUL 1995)

    (a) Except as provided in (b) below, the Contractor shall not enter 
into any agreement with an actual or prospective subcontractor, nor 
otherwise act in any manner, which has or may have the effect of 
restricting sales by such subcontractors directly to the Government of 
any item or process (including computer software) made or furnished by 
the subcontractor under this contract or under any follow-on production 
contract.
    (b) The prohibition in (a) above does not preclude the Contractor 
from asserting rights that are otherwise authorized by law or 
regulation.
    (c) The Contractor agrees to incorporate the substance of this 
clause, including this paragraph (c), in all subcontracts under this 
contract which exceed $100,000.

                             (End of clause)

    Alternate I (OCT 1995). As prescribed in 3.503-2, substitute the 
following paragraph in place of paragraph (b) of the basic clause:

    (b) The prohibition in paragraph (a) of this clause does not 
preclude the Contractor from asserting rights that are otherwise 
authorized by law or regulation. For acquisitions of commercial items, 
the prohibition in paragraph (a) applies only to the extent that any

[[Page 20]]

agreement restricting sales by subcontractors results in the Federal 
Government being treated differently from any other prospective 
purchaser for the sale of the commercial item(s).

[50 FR 35479, Aug. 30, 1985, as amended at 60 FR 34761, July 3, 1995; 60 
FR 48251, Sept. 18, 1995; 61 FR 39198, July 26, 1996]



Sec.  52.203-7  Anti-Kickback Procedures.

    As prescribed in 3.502-3, insert the following clause:

                   Anti-Kickback Procedures (JUL 1995)

    (a) Definitions.
    Kickback, as used in this clause, means any money, fee, commission, 
credit, gift, gratuity, thing of value, or compensation of any kind 
which is provided, directly or indirectly, to any prime Contractor, 
prime Contractor employee, subcontractor, or subcontractor employee for 
the purpose of improperly obtaining or rewarding favorable treatment in 
connection with a prime contract or in connection with a subcontract 
relating to a prime contract.
    Person, as used in this clause, means a corporation, partnership, 
business association of any kind, trust, joint-stock company, or 
individual.
    Prime contract, as used in this clause, means a contract or 
contractual action entered into by the United States for the purpose of 
obtaining supplies, materials, equipment, or services of any kind.
    Prime Contractor, as used in this clause, means a person who has 
entered into a prime contract with the United States.
    Prime Contractor employee, as used in this clause, means any 
officer, partner, employee, or agent of a prime Contractor.
    Subcontract, as used in this clause, means a contract or contractual 
action entered into by a prime Contractor or subcontractor for the 
purpose of obtaining supplies, materials, equipment, or services of any 
kind under a prime contract.
    Subcontractor, as used in this clause, (1) means any person, other 
than the prime Contractor, who offers to furnish or furnishes any 
supplies, materials, equipment, or services of any kind under a prime 
contract or a subcontract entered into in connection with such prime 
contract, and (2) includes any person who offers to furnish or furnishes 
general supplies to the prime Contractor or a higher tier subcontractor.
    Subcontractor employee, as used in this clause, means any officer, 
partner, employee, or agent of a subcontractor.
    (b) The Anti-Kickback Act of 1986 (41 U.S.C. 51-58) (the Act), 
prohibits any person from--
    (1) Providing or attempting to provide or offering to provide any 
kickback;
    (2) Soliciting, accepting, or attempting to accept any kickback; or
    (3) Including, directly or indirectly, the amount of any kickback in 
the contract price charged by a prime Contractor to the United States or 
in the contract price charged by a subcontractor to a prime Contractor 
or higher tier subcontractor.
    (c)(1) The Contractor shall have in place and follow reasonable 
procedures designed to prevent and detect possible violations described 
in paragraph (b) of this clause in its own operations and direct 
business relationships.
    (2) When the Contractor has reasonable grounds to believe that a 
violation described in paragraph (b) of this clause may have occurred, 
the Contractor shall promptly report in writing the possible violation. 
Such reports shall be made to the inspector general of the contracting 
agency, the head of the contracting agency if the agency does not have 
an inspector general, or the Department of Justice.
    (3) The Contractor shall cooperate fully with any Federal agency 
investigating a possible violation described in paragraph (b) of this 
clause.
    (4) The Contracting Officer may (i) offset the amount of the 
kickback against any monies owed by the United States under the prime 
contract and/or (ii) direct that the Prime Contractor withhold, from 
sums owed a subcontractor under the prime contract, the amount of any 
kickback. The Contracting Officer may order the monies withheld under 
subdivision (c)(4)(ii) of this clause be paid over to the Government 
unless the Government has already offset those monies under subdivision 
(c)(4)(i) of this clause. In either case, the Prime Contractor shall 
notify the Contracting Officer when the monies are withheld.
    (5) The Contractor agrees to incorporate the substance of this 
clause, including this subparagraph (c)(5) but excepting subparagraph 
(c)(1), in all subcontracts under under this contract which exceed 
$100,000.

[52 FR 6122, Feb. 27, 1987, as amended at 53 FR 34228, Sept. 2, 1988; 53 
FR 36028, Sept. 16, 1988; 60 FR 34761, July 3, 1995]



Sec.  52.203-8  Cancellation, Rescission, and Recovery of Funds for Illegal 
or Improper Activity.

    As prescribed in 3.104-9(a), insert the following clause:

Cancellation, Rescission, and Recovery of Funds for Illegal or Improper 
                           Activity (JAN 1997)

    (a) If the Government receives information that a contractor or a 
person has engaged in conduct constituting a violation of subsection 
(a), (b), (c), or (d) of Section 27 of the

[[Page 21]]

Office of Federal Procurement Policy Act (41 U.S.C. 423) (the Act), as 
amended by section 4304 of the National Defense Authorization Act for 
Fiscal Year 1996 (Pub. L. 104-106), the Government may--
    (1) Cancel the solicitation, if the contract has not yet been 
awarded or issued; or
    (2) Rescind the contract with respect to which--
    (i) The Contractor or someone acting for the Contractor has been 
convicted for an offense where the conduct constitutes a violation of 
subsection 27 (a) or (b) of the Act for the purpose of either--
    (A) Exchanging the information covered by such subsections for 
anything of value; or
    (B) Obtaining or giving anyone a competitive advantage in the award 
of a Federal agency procurement contract; or
    (ii) The head of the contracting activity has determined, based upon 
a preponderance of the evidence, that the Contractor or someone acting 
for the Contractor has engaged in conduct constituting an offense 
punishable under subsection 27(e)(1) of the Act.
    (b) If the Government rescinds the contract under paragraph (a) of 
this clause, the Government is entitled to recover, in addition to any 
penalty prescribed by law, the amount expended under the contract.
    (c) The rights and remedies of the Government specified herein are 
not exclusive, and are in addition to any other rights and remedies 
provided by law, regulation, or under this contract.

                             (End of clause)

[62 FR 233, Jan. 2, 1997; 62 FR 10710, Mar. 10, 1997, as amended at 67 
FR 13063, Mar. 20, 2002]



Sec.  52.203-9  [Reserved]



Sec.  52.203-10  Price or Fee Adjustment for Illegal or Improper Activity.

    As prescribed in 3.104-9(b) insert the following clause:

   Price or Fee Adjustment for Illegal or Improper Activity (JAN 1997)

    (a) The Government, at its election, may reduce the price of a 
fixed-price type contract and the total cost and fee under a cost-type 
contract by the amount of profit or fee determined as set forth in 
paragraph (b) of this clause if the head of the contracting activity or 
designee determines that there was a violation of subsection 27 (a), 
(b), or (c) of the Office of Federal Procurement Policy Act, as amended 
(41 U.S.C. 423), as implemented in section 3.104 of the Federal 
Acquisition Regulation.
    (b) The price or fee reduction referred to in paragraph (a) of this 
clause shall be--
    (1) For cost-plus-fixed-fee contracts, the amount of the fee 
specified in the contract at the time of award;
    (2) For cost-plus-incentive-fee conrtracts, the target fee specified 
in the contract at the time of award, notwithstanding any minimum fee or 
``fee floor'' specified in the contract.
    (3) For cost-plus-award-fee contracts--
    (i) The base fee established in the contract at the time of contract 
award;
    (ii) If no base fee is specified in the contract, 30 percent of the 
amount of each award fee otherwise payable to the Contractor for each 
award fee evaluation period or at each award fee determination point.
    (4) For fixed-price-incentive contracts, the Government may--
    (i) Reduce the contract target price and contract target profit both 
by an amount equal to the initial target profit specified in the 
contract at the time of contract award; or
    (ii) If an immediate adjustment to the contract target price and 
contract target profit would have a significant adverse impact on the 
incentive price revision relationship under the contract, or adversely 
affect the contract financing provisions, the Contracting Officer may 
defer such adjustment until establishment of the total final price of 
the contract. The total final price established in accordance with the 
incentive price revision provisions of the contract shall be reduced by 
an amount equal to the initial target profit specified in the contract 
at the time of contract award and such reduced price shall be the total 
final contract price.
    (5) For firm-fixed-price contracts, by 10 percent of the initial 
contract price or a profit amount determined by the Contracting Officer 
from records or documents in existence prior to the date of the contract 
award.
    (c) The Government may, at its election, reduce a prime contractor's 
price or fee in accordance with the procedures of paragraph (b) of this 
clause for violations of the Act by its subcontractors by an amount not 
to exceed the amount of profit or fee reflected in the subcontract at 
the time the subcontract was first definitively priced.
    (d) In addition to the remedies in paragraphs (a) and (c) of this 
clause, the Government may terminate this contract for default. The 
rights and remedies of the Government specified herein are not 
exclusive, and are in addition to any other rights and remedies provided 
by law or under this contract.

                             (End of clause)

[55 FR 36797, Sept. 6, 1990, as amended at 62 FR 233, Jan. 2, 1997]

[[Page 22]]



Sec.  52.203-11  Certification and Disclosure Regarding Payments to Influence 
Certain Federal Transactions.

    As prescribed in 3.808, insert the following provision:

  Certification and Disclosure Regarding Payments to Influence Certain 
                     Federal Transactions (APR 1991)

    (a) The definitions and prohibitions contained in the clause, at FAR 
52.203-12, Limitation on Payments to Influence Certain Federal 
Transactions, included in this solicitation, are hereby incorporated by 
reference in paragraph (b) of this certification.
    (b) The offeror, by signing its offer, hereby certifies to the best 
of his or her knowledge and belief that on or after December 23, 1989--
    (1) No Federal appropriated funds have been paid or will be paid to 
any person for influencing or attempting to influence an officer or 
employee of any agency, a Member of Congress, an officer or employee of 
Congress, or an employee of a Member of Congress on his or her behalf in 
connection with the awarding of any Federal contract, the making of any 
Federal grant, the making of any Federal loan, the entering into of any 
cooperative agreement, and the extension, continuation, renewal, 
amendment or modification of any Federal contract, grant, loan, or 
cooperative agreement;
    (2) If any funds other than Federal appropriated funds (including 
profit or fee received under a covered Federal transaction) have been 
paid, or will be paid, to any person for influencing or attempting to 
influence an officer or employee of any agency, a Member of Congress, an 
officer or employee of Congress, or an employee of a Member of Congress 
on his or her behalf in connection with this solicitation, the offeror 
shall complete and submit, with its offer, OMB standard form LLL, 
Disclosure of Lobbying Activities, to the Contracting Officer; and
    (3) He or she will include the language of this certification in all 
subcontract awards at any tier and require that all recipients of 
subcontract awards in excess of $100,000 shall certify and disclose 
accordingly.
    (c) Submission of this certification and disclosure is a 
prerequisite for making or entering into this contract imposed by 
section 1352, title 31, United States Code. Any person who makes an 
expenditure prohibited under this provision or who fails to file or 
amend the disclosure form to be filed or amended by this provision, 
shall be subject to a civil penalty of not less than $10,000, and not 
more than $100,000, for each such failure.

                           (End of provision)

[55 FR 3193, Jan. 30, 1990, as amended at 56 FR 15155, Apr. 15, 1991; 62 
FR 40237, July 25, 1997]



Sec.  52.203-12  Limitation on Payments to Influence Certain Federal Transactions.

    As prescribed in 3.808, insert the following clause:

 Limitation on Payments to Influence Certain Federal Transactions (June 
                                  2003)

    (a) Definitions.
    Agency, as used in this clause, means executive agency as defined in 
2.101.
    Covered Federal action, as used in this clause, means any of the 
following Federal actions:
    (1) The awarding of any Federal contract.
    (2) The making of any Federal grant.
    (3) The making of any Federal loan.
    (4) The entering into of any cooperative agreement.
    (5) The extension, continuation, renewal, amendment, or modification 
of any Federal contract, grant, loan, or cooperative agreement.
    Indian tribe and tribal organization, as used in this clause, have 
the meaning provided in section 4 of the Indian Self-Determination and 
Education Assistance Act (25 U.S.C. 450B) and include Alaskan Natives.
    Influencing or attempting to influence, as used in this clause, 
means making, with the intent to influence, any communication to or 
appearance before an officer or employee of any agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with any covered Federal action.
    Local government, as used in this clause, means a unit of government 
in a State and, if chartered, established, or otherwise recognized by a 
State for the performance of a governmental duty, including a local 
public authority, a special district, an intrastate district, a council 
of governments, a sponsor group representative organization, and any 
other instrumentality of a local government.
    Officer or employee of an agency, as used in this clause, includes 
the following individuals who are employed by an agency:
    (1) An individual who is appointed to a position in the Government 
under title 5, United States Code, including a position under a 
temporary appointment.
    (2) A member of the uniformed services, as defined in subsection 
101(3), title 37, United States Code.
    (3) A special Government employee, as defined in section 202, title 
18, United States Code.
    (4) An individual who is a member of a Federal advisory committee, 
as defined by the

[[Page 23]]

Federal Advisory Committee Act, title 5, United States Code, appendix 2.
    Person, as used in this clause, means an individual, corporation, 
company, association, authority, firm, partnership, society, State, and 
local government, regardless of whether such entity is operated for 
profit, or not for profit. This term excludes an Indian tribe, tribal 
organization, or any other Indian organization with respect to 
expenditures specifically permitted by other Federal law.
    Reasonable compensation, as used in this clause, means, with respect 
to a regularly employed officer or employee of any person, compensation 
that is consistent with the normal compensation for such officer or 
employee for work that is not furnished to, not funded by, or not 
furnished in cooperation with the Federal Government.
    Reasonable payment, as used in this clause, means, with respect to 
professional and other technical services, a payment in an amount that 
is consistent with the amount normally paid for such services in the 
private sector.
    Recipient, as used in this clause, includes the Contractor and all 
subcontractors. This term excludes an Indian tribe, tribal organization, 
or any other Indian organization with respect to expenditures 
specifically permitted by other Federal law.
    Regularly employed, as used in this clause, means, with respect to 
an officer or employee of a person requesting or receiving a Federal 
contract, an officer or employee who is employed by such person for at 
least 130 working days within 1 year immediately preceding the date of 
the submission that initiates agency consideration of such person for 
receipt of such contract. An officer or employee who is employed by such 
person for less than 130 working days within 1 year immediately 
preceding the date of the submission that initiates agency consideration 
of such person shall be considered to be regularly employed as soon as 
he or she is employed by such person for 130 working days.
    State, as used in this clause, means a State of the United States, 
the District of Columbia, or an outlying area of the United States, an 
agency or instrumentality of a State, and multi-State, regional, or 
interstate entity having governmental duties and powers.
    (b) Prohibitions. (1) Section 1352 of title 31, United States Code, 
among other things, prohibits a recipient of a Federal contract, grant, 
loan, or cooperative agreement from using appropriated funds to pay any 
person for influencing or attempting to influence an officer or employee 
of any agency, a Member of Congress, an officer or employee of Congress, 
or an employee of a Member of Congress in connection with any of the 
following covered Federal actions: the awarding of any Federal contract; 
the making of any Federal grant; the making of any Federal loan; the 
entering into of any cooperative agreement; or the modification of any 
Federal contract, grant, loan, or cooperative agreement.
    (2) The Act also requires Contractors to furnish a disclosure if any 
funds other than Federal appropriated funds (including profit or fee 
received under a covered Federal transaction) have been paid, or will be 
paid, to any person for influencing or attempting to influence an 
officer or employee of any agency, a Member of Congress, an officer or 
employee of Congress, or an employee of a Member of Congress in 
connection with a Federal contract, grant, loan, or cooperative 
agreement.
    (3) The prohibitions of the Act do not apply under the following 
conditions:
    (i) Agency and legislative liaison by own employees. (A) The 
prohibition on the use of appropriated funds, in subparagraph (b)(1) of 
this clause, does not apply in the case of a payment of reasonable 
compensation made to an officer or employee of a person requesting or 
receiving a covered Federal action if the payment is for agency and 
legislative liaison activities not directly related to a covered Federal 
action.
    (B) For purposes of subdivision (b)(3)(i)(A) of this clause, 
providing any information specifically requested by an agency or 
Congress is permitted at any time.
    (C) The following agency and legislative liaison activities are 
permitted at any time where they are not related to a specific 
solicitation for any covered Federal action:
    (1) Discussing with an agency the qualities and characteristics 
(including individual demonstrations) of the person's products or 
services, conditions or terms of sale, and service capabilities.
    (2) Technical discussions and other activities regarding the 
application or adaptation of the person's products or services for an 
agency's use.
    (D) The following agency and legislative liaison activities are 
permitted where they are prior to formal solicitation of any covered 
Federal action--
    (1) Providing any information not specifically requested but 
necessary for an agency to make an informed decision about initiation of 
a covered Federal action;
    (2) Technical discussions regarding the preparation of an 
unsolicited proposal prior to its official submission; and
    (3) Capability presentations by persons seeking awards from an 
agency pursuant to the provisions of the Small Business Act, as amended 
by Pub. L. 95-507, and subsequent amendments.
    (E) Only those services expressly authorized by subdivison 
(b)(3)(i)(A) of this clause are permitted under this clause.
    (ii) Professional and technical services. (A) The prohibition on the 
use of appropriated funds, in subparagraph (b)(1) of this clause, does 
not apply in the case of--

[[Page 24]]

    (1) A payment of reasonable compensation made to an officer or 
employee of a person requesting or receiving a covered Federal action or 
an extension, continuation, renewal, amendment, or modification of a 
covered Federal action, if payment is for professional or technical 
services rendered directly in the preparation, submission, or 
negotiation of any bid, proposal, or application for that Federal action 
or for meeting requirements imposed by or pursuant to law as a condition 
for receiving that Federal action.
    (2) Any reasonable payment to a person, other than an officer or 
employee of a person requesting or receiving a covered Federal action or 
an extension, continuation, renewal, amendment, or modification of a 
covered Federal action if the payment is for professional or technical 
services rendered directly in the preparation, submission, or 
negotiation of any bid, proposal, or application for that Federal action 
or for meeting requirements imposed by or pursuant to law as a condition 
for receiving that Federal action. Persons other than officers or 
employees of a person requesting or receiving a covered Federal action 
include consultants and trade associations.
    (B) For purposes of subdivision (b)(3)(ii)(A) of this clause, 
professional and technical services shall be limited to advice and 
analysis directly applying any professional or technical discipline. For 
example, drafting of a legal document accompanying a bid or proposal by 
a lawyer is allowable.
    Similarly, technical advice provided by an engineer on the 
performance or operational capability of a piece of equipment rendered 
directly in the negotiation of a contract is allowable. However, 
communications with the intent to influence made by a professional (such 
as a licensed lawyer) or a technical person (such as a licensed 
accountant) are not allowable under this section unless they provide 
advice and analysis directly applying their professional or technical 
expertise and unless the advice or analysis is rendered directly and 
solely in the preparation, submission or negotiation of a covered 
Federal action. Thus, for example, communications with the intent to 
influence made by a lawyer that do not provide legal advice or analysis 
directly and solely related to the legal aspects of his or her clients's 
proposal, but generally advocate one proposal over another are not 
allowable under this section because the lawyer is not providing 
professional legal services. Similarly, communications with the intent 
to influence made by an engineer providing an engineering analysis prior 
to the preparation or submission of a bid or proposal are not allowable 
under this section since the engineer is providing technical services 
but not directly in the preparation, submission or negotiation of a 
covered Federal action.
    (C) Requirements imposed by or pursuant to law as a condition for 
receiving a covered Federal award include those required by law or 
regulation and any other requirements in the actual award documents.
    (D) Only those services expressly authorized by subdivisions 
(b)(3)(ii)(A) (1) and (2) of this clause are permitted under this 
clause.
    (E) The reporting requirements of FAR 3.803(a) shall not apply with 
respect to payments of reasonable compensation made to regularly 
employed officers or employees of a person.
    (c) Disclosure. (1) The Contractor who requests or receives from an 
agency a Federal contract shall file with that agency a disclosure form, 
OMB standard form LLL, Disclosure of Lobbying Activities, if such person 
has made or has agreed to make any payment using nonappropriated funds 
(to include profits from any covered Federal action), which would be 
prohibited under subparagraph (b)(1) of this clause, if paid for with 
appropriated funds.
    (2) The Contractor shall file a disclosure form at the end of each 
calendar quarter in which there occurs any event that materially affects 
the accuracy of the information contained in any disclosure form 
previously filed by such person under subparagraph (c)(1) of this 
clause. An event that materially affects the accuracy of the information 
reported includes--
    (i) A cumulative increase of $25,000 or more in the amount paid or 
expected to be paid for influencing or attempting to influence a covered 
Federal action; or
    (ii) A change in the person(s) or individual(s) influencing or 
attempting to influence a covered Federal action; or
    (iii) A change in the officer(s), employee(s), or Member(s) 
contacted to influence or attempt to influence a covered Federal action.
    (3) The Contractor shall require the submittal of a certification, 
and if required, a disclosure form by any person who requests or 
received any subcontract exceeding $100,000 under the Federal contract.
    (4) All subcontractor disclosure forms (but not certifications) 
shall be forwarded from tier to tier until received by the prime 
Contractor. The prime Contractor shall submit all disclosures to the 
Contracting Officer at the end of the calendar quarter in which the 
disclosure form is submitted by the subcontractor. Each subcontractor 
certification shall be retained in the subcontract file of the awarding 
Contractor.
    (d) Agreement. The Contractor agrees not to make any payment 
prohibited by this clause.
    (e) Penalties. (1) Any person who makes an expenditure prohibited 
under paragraph (a) of this clause or who fails to file or amend the 
disclosure form to be filed or amended by paragraph (b) of this clause 
shall be subject to civil penalties as provided for by 31 U.S.C. 1352. 
An imposition of a civil penalty does

[[Page 25]]

not prevent the Government from seeking any other remedy that may be 
applicable.
    (2) Contractors may rely without liability on the representation 
made by their subcontractors in the certification and disclosure form.
    (f) Cost allowability. Nothing in this clause makes allowable or 
reasonable any costs which would otherwise be unallowable or 
unreasonable. Conversely, costs made specifically unallowable by the 
requirements in this clause will not be made allowable under any other 
provision.

                             (End of clause)

[55 FR 3193, Jan. 30, 1990, as amended at 55 FR 38517, Sept. 18, 1990; 
62 FR 40237, July 25, 1997; 68 FR 28084, May 22, 2003]



Sec.  52.204-1  Approval of Contract.

    As prescribed in 4.103, insert the following clause:

                     Approval of Contract (DEC 1989)

    This contract is subject to the written approval of . . . . . 
[identify title of designated agency official here] and shall not be 
binding until so approved.

                             (End of clause)

[54 FR 5058, Jan. 31, 1989, as amended at 54 FR 48990, Nov. 28, 1989]



Sec.  52.204-2  Security Requirements.

    As prescribed in 4.404(a), insert the following clauses:

                    Security Requirements (AUG 1996)

    (a) This clause applies to the extent that this contract involves 
access to information classified Confidential, Secret, or Top Secret.
    (b) The Contractor shall comply with (1) the Security Agreement (DD 
Form 441), including the National Industrial Security Program Operating 
Manual (DOD 5220.22-M), and (2) any revisions to that manual, notice of 
which has been furnished to the Contractor.
    (c) If, subsequent to the date of this contract, the security 
classification or security requirements under this contract are changed 
by the Government and if the changes cause an increase or decrease in 
security costs or otherwise affect any other term or condition of this 
contract, the contract shall be subject to an equitable adjustment as if 
the changes were directed under the Changes clause of this contract.
    (d) The Contractor agrees to insert terms that conform substantially 
to the language of this clause, including this paragraph (d) but 
excluding any reference to the Changes clause of this contract, in all 
subcontracts under this contract that involve access to classified 
information.

                             (End of clause)

    Alternate I (APR 1984). If a cost contract for research and 
development with an educational institution is contemplated, add the 
following paragraphs (e), (f), and (g) to the basic clause:

    (e) If a change in security requirements, as provided in paragraphs 
(b) and (c), results (1) in a change in the security classification of 
this contract or any of its elements from an unclassified status or a 
lower classification to a higher classification, or (2) in more 
restrictive area controls than previously required, the Contractor shall 
exert every reasonable effort compatible with the Contractor's 
established policies to continue the performance of work under the 
contract in compliance with the change in security classification or 
requirements. If, despite reasonable efforts, the Contractor determines 
that the continuation of work under this contract is not practicable 
because of the change in security classification or requirements, the 
Contractor shall notify the Contracting Officer in writing. Until 
resolution of the problem is made by the Contracting Officer, the 
Contractor shall continue safeguarding all classified material as 
required by this contract.
    (f) After receiving the written notification, the Contracting 
Officer shall explore the circumstances surrounding the proposed change 
in security classification or requirements, and shall endeavor to work 
out a mutually satisfactory method whereby the Contractor can continue 
performance of the work under this contract.
    (g) If, 15 days after receipt by the Contracting Officer of the 
notification of the Contractor's stated inability to proceed, (1) the 
application to this contract of the change in security classification or 
requirements has not been withdrawn or (2) a mutually satisfactory 
method for continuing performance of work under this contract has not 
been agreed upon, the Contractor may request the Contracting Officer to 
terminate the contract in whole or in part. The Contracting Officer 
shall terminate the contract in whole or in part, as may be appropriate, 
and the termination shall be deemed a termination under the terms of the 
Termination for the Convenience of the Government clause.

    Alternate II (APR 1984). If employee identification is required for 
security or other reasons in a construction contract or architect-
engineer contract,

[[Page 26]]

add the following paragraph (e) to the basic clause:

    (e) The Contractor shall be responsible for furnishing to each 
employee and for requiring each employee engaged on the work to display 
such identification as may be approved and directed by the Contracting 
Officer. All prescribed identification shall immediately be delivered to 
the Contracting Officer, for cancellation upon the release of any 
employee. When required by the Contracting Officer, the Contractor shall 
obtain and submit fingerprints of all persons employed or to be employed 
on the project.

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 31617, June 20, 1996]



Sec.  52.204-3  Taxpayer identification.

    As prescribed in 4.905, insert the following provision:

                   Taxpayer Identification (OCT 1998)

    (a) Definitions.
    Common parent, as used in this provision, means that corporate 
entity that owns or controls an affiliated group of corporations that 
files its Federal income tax returns on a consolidated basis, and of 
which the offeror is a member.
    Taxpayer Identification Number (TIN), as used in this provision, 
means the number required by the Internal Revenue Service (IRS) to be 
used by the offeror in reporting income tax and other returns. The TIN 
may be either a Social Security Number or an Employer Identification 
Number.
    (b) All offerors must submit the information required in paragraphs 
(d) through (f) of this provision to comply with debt collection 
requirements of 31 U.S.C. 7701(c) and 3325(d), reporting requirements of 
26 U.S.C. 6041, 6041A, and 6050M, and implementing regulations issued by 
the IRS. If the resulting contract is subject to the payment reporting 
requirements described in Federal Acquisition Regulation (FAR) 4.904, 
the failure or refusal by the offeror to furnish the information may 
result in a 31 percent reduction of payments otherwise due under the 
contract.
    (c) The TIN may be used by the Government to collect and report on 
any delinquent amounts arising out of the offeror's relationship with 
the Government (31 U.S.C. 7701(c)(3)). If the resulting contract is 
subject to the payment reporting requirements described in FAR 4.904, 
the TIN provided hereunder may be matched with IRS records to verify the 
accuracy of the offeror's TIN.
    (d) Taxpayer Identification Number (TIN).
[squ] TIN:______________________________________________________________
    [squ] TIN has been applied for.
    [squ] TIN is not required because:
    [squ] Offeror is a nonresident alien, foreign corporation, or 
foreign partnership that does not have income effectively connected with 
the conduct of a 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;
    [squ] Offeror is an agency or instrumentality of a foreign 
government;
    [squ] Offeror is an agency or instrumentality of the Federal 
Government.
    (e) Type of organization.
    [squ] Sole proprietorship;
    [squ] Partnership;
    [squ] Corporate entity (not tax-exempt);
    [squ] Corporate entity (tax-exempt);
    [squ] Government entity (Federal, State, or local);
    [squ] Foreign government;
    [squ] International organization per 26 CFR 1.6049-4;

[squ] Other_____________________________________________________________
    (f) Common parent.
    [squ] Offeror is not owned or controlled by a common parent as 
defined in paragraph (a) of this provision.
    [squ] Name and TIN of common parent:

Name____________________________________________________________________

TIN_____________________________________________________________________

                           (End of provision)

[63 FR 58589, Oct. 30, 1998]



Sec.  52.204-4  Printed or Copied Double-Sided on Recycled Paper.

    As prescribed in 4.303, insert the following clause:

       Printed or Copied Double-Sided on Recycled Paper (AUG 2000)

    (a) Definitions. As used in this clause--
    Postconsumer material means a material or finished product that has 
served its intended use and has been discarded for disposal or recovery, 
having completed its life as a consumer item. Postconsumer material is a 
part of the broader category of ``recovered material.'' For paper and 
paper products, postconsumer material means ``postconsumer fiber'' 
defined by the U.S. Environmental Protection Agency (EPA) as--
    (1) Paper, paperboard, and fibrous materials from retail stores, 
office buildings, homes, and so forth, after they have passed through 
their end-usage as a consumer item, including: used corrugated boxes; 
old newspapers; old magazines; mixed waste paper; tabulating cards; and 
used cordage; or
    (2) All paper, paperboard, and fibrous materials that enter and are 
collected from municipal solid waste; but not
    (3) Fiber derived from printers' over-runs, converters' scrap, and 
over-issue publications.
    Printed or copied double-sided means printing or reproducing a 
document so that information is on both sides of a sheet of paper.

[[Page 27]]

    Recovered material, for paper and paper products, is defined by EPA 
in its Comprehensive Procurement Guideline as ``recovered fiber'' and 
means the following materials:
    (1) Postconsumer fiber; and
    (2) Manufacturing wastes such as--
    (i) Dry paper and paperboard waste generated after completion of the 
papermaking process (that is, those manufacturing operations up to and 
including the cutting and trimming of the paper machine reel into 
smaller rolls or rough sheets) including: envelope cuttings, bindery 
trimmings, and other paper and paperboard waste resulting from printing, 
cutting, forming, and other converting operations; bag, box, and carton 
manufacturing wastes; and butt rolls, mill wrappers, and rejected unused 
stock; and
    (ii) Repulped finished paper and paperboard from obsolete 
inventories of paper and paperboard manufacturers, merchants, 
wholesalers, dealers, printers, converters, or others.
    (b) In accordance with Section 101 of Executive Order 13101 of 
September 14, 1998, Greening the Government through Waste Prevention, 
Recycling, and Federal Acquisition, the Contractor is encouraged to 
submit paper documents, such as offers, letters, or reports, that are 
printed or copied double-sided on recycled paper that meet minimum 
content standards specified in Section 505 of Executive Order 13101, 
when not using electronic commerce methods to submit information or data 
to the Government.
    (c) If the Contractor cannot purchase high-speed copier paper, 
offset paper, forms bond, computer printout paper, carbonless paper, 
file folders, white wove envelopes, writing and office paper, book 
paper, cotton fiber paper, and cover stock meeting the 30 percent 
postconsumer material standard for use in submitting paper documents to 
the Government, it should use paper containing no less than 20 percent 
postconsumer material. This lesser standard should be used only when 
paper meeting the 30 percent postconsumer material standard is not 
obtainable at a reasonable price or does not meet reasonable performance 
standards.

                             (End of clause)

[65 FR 36020, June 6, 2000]



Sec.  52.204-5  Women-Owned Business (Other Than Small Business).

    As prescribed in 4.603(b), insert the following provision:

       Women-Owned Business (Other Than Small Business) (MAY 1999)

    (a) Definition. Women-owned business concern, as used in this 
provision, means a concern that is at least 51 percent owned by one or 
more women; or in the case of any publicly owned business, at least 51 
percent of its stock is owned by one or more women; and whose management 
and daily business operations are controlled by one or more women.
    (b) Representation. [Complete only if the offeror is a women-owned 
business concern and has not represented itself as a small business 
concern in paragraph (b)(1) of FAR 52.219-1, Small Business Program 
Representations, of this solicitation.] The offeror represents that it 
[squ] is a women-owned business concern.

                           (End of provision)

[64 FR 10533, Mar. 4, 1999; 64 FR 30103, June 4, 1999]



Sec.  52.204-6  Data Universal Numbering System (DUNS) Number.

    As prescribed in 4.603(a), insert the following provision:

        Data Universal Numbering System (DUNS) Number (Oct 2003)

    (a) The offeror shall enter, in the block with its name and address 
on the cover page of its offer, the annotation ``DUNS'' or ``DUNS+4'' 
followed by the DUNS number or ``DUNS+4'' that identifies the offeror's 
name and address exactly as stated in the offer. The DUNS number is a 
nine-digit number assigned by Dun and Bradstreet, Inc. The DUNS+4 is the 
DUNS number plus a 4-character suffix that may be assigned at the 
discretion of the offeror to establish additional CCR records for 
identifying alternative Electronic Funds Transfer (EFT) accounts (see 
Subpart 32.11) for the same parent concern.
    (b) If the offeror does not have a DUNS number, it should contact 
Dun and Bradstreet directly to obtain one.
    (1) An offeror may obtain a DUNS number--
    (i) If located within the United States, by calling Dun and 
Bradstreet at 1-866-705-5711 or via the Internet at http://www.dnb.com; 
or
    (ii) If located outside the United States, by contacting the local 
Dun and Bradstreet office.
    (2) The offeror should be prepared to provide the following 
information:
    (i) Company legal business name.
    (ii) Tradestyle, doing business, or other name by which your entity 
is commonly recognized.
    (iii) Company physical street address, city, state and Zip Code.
    (iv) Company mailing address, city, state and Zip Code (if separate 
from physical).
    (v) Company telephone number.
    (vi) Date the company was started.
    (vii) Number of employees at your location.
    (viii) Chief executive officer/key manager.

[[Page 28]]

    (ix) Line of business (industry).
    (x) Company Headquarters name and address (reporting relationship 
within your entity).

(End of provision)

[68 FR 56674, Oct. 1, 2003]



Sec.  52.204-7  Central Contractor Registration.

    As prescribed in 4.1104, use the following clause:

               Central Contractor Registration (Oct 2003)

    (a) Definitions. As used in this clause--
    Central Contractor Registration (CCR) database means the primary 
Government repository for Contractor information required for the 
conduct of business with the Government.
    Data Universal Numbering System (DUNS) number means the 9-digit 
number assigned by Dun and Bradstreet, Inc. (D&B) to identify unique 
business entities.
    Data Universal Numbering System +4 (DUNS+4) number means the DUNS 
number assigned by D&B plus a 4-character suffix that may be assigned by 
a business concern. (D&B has no affiliation with this 4-character 
suffix.) This 4-character suffix may be assigned at the discretion of 
the business concern to establish additional CCR records for identifying 
alternative Electronic Funds Transfer (EFT) accounts (see the FAR at 
Subpart 32.11) for the same parent concern.
    Registered in the CCR database means that--
    (1) The Contractor has entered all mandatory information, including 
the DUNS number or the DUNS+4 number, into the CCR database; and
    (2) The Government has validated all mandatory data fields and has 
marked the record ``Active''.
    (b)(1) By submission of an offer, the offeror acknowledges the 
requirement that a prospective awardee shall be registered in the CCR 
database prior to award, during performance, and through final payment 
of any contract, basic agreement, basic ordering agreement, or blanket 
purchasing agreement resulting from this solicitation.
    (2) The offeror shall enter, in the block with its name and address 
on the cover page of its offer, the annotation ``DUNS'' or ``DUNS +4'' 
followed by the DUNS or DUNS +4 number that identifies the offeror's 
name and address exactly as stated in the offer. The DUNS number will be 
used by the Contracting Officer to verify that the offeror is registered 
in the CCR database.
    (c) If the offeror does not have a DUNS number, it should contact 
Dun and Bradstreet directly to obtain one.
    (1) An offeror may obtain a DUNS number--
    (i) If located within the United States, by calling Dun and 
Bradstreet at 1-866-705-5711 or via the Internet at http://www.dnb.com; 
or
    (ii) If located outside the United States, by contacting the local 
Dun and Bradstreet office.
    (2) The offeror should be prepared to provide the following 
information:
    (i) Company legal business.
    (ii) Tradestyle, doing business, or other name by which your entity 
is commonly recognized.
    (iii) Company Physical Street Address, City, State, and Zip Code.
    (iv) Company Mailing Address, City, State and Zip Code (if separate 
from physical).
    (v) Company Telephone Number.
    (vi) Date the company was started.
    (vii) Number of employees at your location.
    (viii) Chief executive officer/key manager.
    (ix) Line of business (industry).
    (x) Company Headquarters name and address (reporting relationship 
within your entity).
    (d) If the Offeror does not become registered in the CCR database in 
the time prescribed by the Contracting Officer, the Contracting Officer 
will proceed to award to the next otherwise successful registered 
Offeror.
    (e) Processing time, which normally takes 48 hours, should be taken 
into consideration when registering. Offerors who are not registered 
should consider applying for registration immediately upon receipt of 
this solicitation.
    (f) The Contractor is responsible for the accuracy and completeness 
of the data within the CCR database, and for any liability resulting 
from the Government's reliance on inaccurate or incomplete data. To 
remain registered in the CCR database after the initial registration, 
the Contractor is required to review and update on an annual basis from 
the date of initial registration or subsequent updates its information 
in the CCR database to ensure it is current, accurate and complete. 
Updating information in the CCR does not alter the terms and conditions 
of this contract and is not a substitute for a properly executed 
contractual document.
    (g)(1)(i) If a Contractor has legally changed its business name, 
``doing business as'' name, or division name (whichever is shown on the 
contract), or has transferred the assets used in performing the 
contract, but has not completed the necessary requirements regarding 
novation and change-of-name agreements in Subpart 42.12, the Contractor 
shall provide the responsible Contracting Officer a minimum of one 
business day's written notification of its intention to (A) change the 
name in the CCR database; (B) comply with the requirements of Subpart 
42.12 of the FAR; and

[[Page 29]]

(C) agree in writing to the timeline and procedures specified by the 
responsible Contracting Officer. The Contractor must provide with the 
notification sufficient documentation to support the legally changed 
name.
    (ii) If the Contractor fails to comply with the requirements of 
paragraph (g)(1)(i) of this clause, or fails to perform the agreement at 
paragraph (g)(1)(i)(C) of this clause, and, in the absence of a properly 
executed novation or change-of-name agreement, the CCR information that 
shows the Contractor to be other than the Contractor indicated in the 
contract will be considered to be incorrect information within the 
meaning of the ``Suspension of Payment'' paragraph of the electronic 
funds transfer (EFT) clause of this contract.
    (2) The Contractor shall not change the name or address for EFT 
payments or manual payments, as appropriate, in the CCR record to 
reflect an assignee for the purpose of assignment of claims (see FAR 
Subpart 32.8, Assignment of Claims). Assignees shall be separately 
registered in the CCR database. Information provided to the Contractor's 
CCR record that indicates payments, including those made by EFT, to an 
ultimate recipient other than that Contractor will be considered to be 
incorrect information within the meaning of the ``Suspension of 
payment'' paragraph of the EFT clause of this contract.
    (h) Offerors and Contractors may obtain information on registration 
and annual confirmation requirements via the internet at http://
www.ccr.gov or by calling 1-888-227-2423, or 269-961-5757.
    Alternate I (Oct. 2003). As prescribed in 4.1104(a), substitute the 
following paragraph (b) for paragraph (b) of the basic clause:
    (b)(1) The Contractor shall be registered in the CCR database by --
-------- [Contracting Officer shall insert a date no later than December 
31, 2003]. The Contractor shall maintain registration during performance 
and through final payment of this contract.
    (2) The Contractor shall enter, in the block with its name and 
address on the cover page of the SF 30, Amendment of solicitation/
Modification of Contract, the annotation ``DUNS'' or ``DUNS +4'' 
followed by the DUNS or DUNS +4 number that identifies the Contractor's 
name and address exactly as stated in this contract. The DUNS number 
will be used by the Contracting Officer to verify that the Contractor is 
registered in the CCR database.

[68 FR 56674, Oct. 1, 2003]



Sec.  52.205-52.206  [Reserved]



Sec.  52.207-1  Notice of Cost Comparison (Sealed-Bid).

    As prescribed in 7.305(a), insert the following provision:

            Notice of Cost Comparison (Sealed-Bid) (FEB 1993)

    (a) This solicitation is part of a Government cost comparison to 
determine whether accomplishing the specified work under contract or by 
Government performance is more economical. If Government performance is 
determined to be more economical, this solicitation will be canceled and 
no contract will be awarded.
    (b) The Government's cost estimate for performance by the Government 
will be based on the work statement in this solicitation and will be 
submitted by designated agency personnel to the Contracting Officer in a 
sealed envelope not later than the time set for bid opening. At the 
public bid opening, the Contracting Officer will open the bids and the 
envelope containing the cost estimate for Government performance and 
announce the result. This announcement will be based on an initial 
comparison of the cost of Government performance with the cost of 
contract performance, as indicated on the cost comparison form.
    (c) The abstract of bids, completed cost comparison form, and 
detailed data supporting the cost estimate for Government performance 
will be made available to interested parties for review for a period of 
---------- [insert a number from 15 to 30, depending on the complexity 
of the matter (see 7.306(a)(1)(iv)] working days, beginning with the 
date the documents are available to interested parties. The Government 
will not make a final determination either for contract or Government 
performance during this period. During this period, directly affected 
parties may file with the Contracting Officer written requests, based on 
specific objections, for administrative review of the cost-comparison 
result under the agency appeals procedure. The appeals procedure shall 
be used only to resolve questions concerning the calculation of the cost 
comparison and will not apply to decisions regarding selection of one 
bidder in preference to another. Agency determinations under the appeals 
procedure shall be final.
    (d) After evaluation of bids and resolution of any requests under 
the appeals procedure, the Contracting Officer will either award a 
contract or cancel this solicitation. The completed cost comparison 
analysis will be made available to interested parties.

[[Page 30]]

    (e) A cost estimate for Government performance is considered a bid 
for purposes of this solicitation's Late Modifications of Bids or 
Withdrawal of Bids provision, and a late modification that displaces an 
otherwise low cost estimate for Government performance shall not be 
considered.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 1746, Jan. 11, 1985; 
50 FR 52429, Dec. 23, 1985; 55 FR 25530, June 21, 1990; 57 FR 60575, 
Dec. 21, 1992]



Sec.  52.207-2  Notice of Cost Comparison (Negotiated).

    As prescribed in 7.305(b), insert the following provision:

            Notice of Cost Comparison (Negotiated) (FEB 1993)

    (a) This solicitation is part of a Government cost comparison to 
determine whether accomplishing the specified work under contract or by 
Government performance is more economical. If Government performance is 
determined to be more economical, this solicitation will be canceled and 
no contract will be awarded.
    (b) The Government's cost estimate for performance by the Government 
will be based on the work statement in this solicitation and will be 
submitted by designated agency personnel to the Contracting Officer in a 
sealed envelope not later than the time set for receipt of initial 
proposals.
    (c) After completion of proposal evaluation, negotiation, and 
selection of the most advantageous proposal, the Contracting Officer, in 
the presence of the preparer of the cost estimate for Government 
performance, will open the sealed cost estimate envelope. These 
officials will make a cost comparison before public announcement. 
Depending on whether the cost comparison result favors performance under 
contract or Government performance, the procedure in either subparagraph 
(1) or (2) following applies:
    (1) If the result of the cost comparison favors performance under 
contract and administrative approval is obtained, the Contracting 
Officer will award a contract and publicly reveal the completed cost 
comparison form showing the cost estimate for Government performance, 
its detailed supporting data, and the Contractor's name. However, this 
award is conditioned on the offer remaining the more economical 
alternative after (i) completion of a public review period of -- [insert 
a numeral from 15 to 30, depending upon the complexity of the matter 
(see 7.306(b)(3))] working days beginning with the date this information 
is available to interested parties and (ii) resolution of any requests 
for review under the agency appeals procedure (see paragraph (d) below). 
The Government assumes no liability for costs incurred during the 
periods specified in (i) and (ii). The Contracting Officer will then 
either notify the Contractor in writing that it may proceed with 
performance of the contract or will cancel the contract at no cost to 
the Government.
    (2) If the result of the cost comparison favors Government 
performance, the Contracting Officer will publicly disclose this result, 
the completed cost comparison form and its detailed supporting data, and 
the price of the offer most advantageous to the Government. After (i) 
completion of a public review period of -- [insert a numeral from 15 to 
30, depending upon the complexity of the matter (see 7.306(b)(3)] 
working days beginning with the date this information is available to 
interested parties and (ii) resolution of any requests for review under 
the agency appeals procedure (see paragraph (d) below), the Contracting 
Officer will either cancel this solicitation or award a contract, as 
appropriate.
    (d) During the public review period, directly affected parties may 
file with the Contracting Officer written requests, based on specific 
objections, for administrative review of the cost comparison result 
under the agency appeals procedure. The appeals procedure shall be used 
only to resolve questions concerning the calculation of the cost 
comparison and will not apply to questions concerning award to one 
offeror in preference to another. Agency determinations under the 
appeals procedure shall be final.
    (e) A cost estimate for Government performance is considered a 
proposal for purposes of this solicitation's Late Submissions, 
Modifications, and Withdrawal of Proposals or Quotations provision, and 
a late modification that displaces an otherwise low cost estimate for 
Government performance shall not be considered.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 25530, June 21, 1990; 
57 FR 60575, Dec. 21, 1992]



Sec.  52.207-3  Right of First Refusal of Employment.

    As prescribed in 7.305(c), insert the following clause:

             Right of First Refusal of Employment (NOV 1991)

    (a) The Contractor shall give Government employees who have been or 
will be adversely affected or separated as a result of award of this 
contract the right of first refusal for employment openings under the 
contract in positions for which they are qualified, if that employment 
is consistent

[[Page 31]]

with post-Government employment conflict of interest standards.
    (b) Within 10 days after contract award, the Contracting Officer 
will provide to the Contractor a list of all Government employees who 
have been or will be adversely affected or separated as a result of 
award of this contract.
    (c) The Contractor shall report to the Contracting Officer the names 
of individuals identified on the list who are hired within 90 days after 
contract performance begins. This report shall be forwarded within 120 
days after contract performance begins.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 52 FR 9039, Mar. 20, 1987; 
56 FR 55372, Oct. 25, 1991]



Sec.  52.207-4  Economic Purchase Quantity--Supplies.

    As prescribed in 7.203, insert the following provision:

             Economic Purchase Quantity--Supplies (AUG 1987)

    (a) Offerors are invited to state an opinion on whether the 
quantity(ies) of supplies on which bids, proposals or quotes are 
requested in this solicitation is (are) economically advantageous to the 
Government.
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
    (b) Each offeror who believes that acquisitions in different 
quantities would be more advantageous is invited to recommend an 
economic purchase quantity. If different quantities are recommended, a 
total and a unit price must be quoted for applicable items. An economic 
purchase quantity is that quantity at which a significant price break 
occurs. If there are significant price breaks at different quantity 
points, this information is desired as well.

                         Offeror Recommendations
------------------------------------------------------------------------
                                                       Price
                  Item                    Quantity   quotation    Total
------------------------------------------------------------------------
                                         .........  ...........  .......
                                         .........  ...........  .......
                                         .........  ...........  .......
------------------------------------------------------------------------

    (c) The information requested in this provision is being solicited 
to avoid acquisitions in disadvantageous quantities and to assist the 
Government in developing a data base for future acquisitions of these 
items. However, the Government reserves the right to amend or cancel the 
solicitation and resolicit with respect to any individual item in the 
event quotations received and the Government's requirements indicate 
that different quantities should be acquired.

                           (End of provision)

[50 FR 35479, Aug. 30, 1985, as amended at 52 FR 30078, Aug. 12, 1987]



Sec.  52.207-5  Option to Purchase Equipment.

    As prescribed in 7.404, insert a clause substantially the same as 
the following:

                 Option to Purchase Equipment (FEB 1995)

    (a) The Government may purchase the equipment provided on a lease or 
rental basis under this contract. The Contracting Officer may exercise 
this option only by providing a unilateral modification to the 
Contractor. The effective date of the purchase will be specified in the 
unilateral modification and may be any time during the period of the 
contract, including any extensions thereto.
    (b) Except for final payment and transfer of title to the 
Government, the lease or rental portion of the contract becomes complete 
and lease or rental charges shall be discontinued on the day immediately 
preceding the effective date of purchase specified in the unilateral 
modification required in paragraph (a) of this clause.
    (c) The purchase conversion cost of the equipment shall be computed 
as of the effective date specified in the unilateral modification 
required in paragraph (a) of this clause, on the basis of the purchase 
price set forth in the contract, minus the total purchase option credits 
accumulated during the period of lease or rental, calculated by the 
formula contained elsewhere in this contract.
    (d) The accumulated purchase option credits available to determine 
the purchase conversion cost will also include any credits accrued 
during a period of lease or rental of the equipment under any previous 
Government contract if the equipment has been on continuous lease or 
rental. The movement of equipment from one site to another site shall be 
``continuous rental.''

                             (End of clause)

[59 FR 67026, Dec. 28, 1994]



Sec.  52.208-1--52.208-3  [Reserved]



Sec.  52.208-4  Vehicle Lease Payments.

    As prescribed in 8.1104(a), insert the following clause in 
solicitations and contracts for leasing motor vehicles, unless the motor 
vehicles are leased in foreign countries:

[[Page 32]]

                    Vehicle Lease Payments (APR 1984)

    (a) Upon the submission of proper invoices or vouchers, the 
Government shall pay rent for each vehicle at the rate(s) specified in 
this contract.
    (b) Rent shall accrue from the beginning of this contract, or from 
the date each vehicle is delivered to the Government, whichever is 
later, and shall continue until the expiration of the contract term or 
the termination of this contract. However, rent shall accrue only for 
the period that each vehicle is in the possession of the Government.
    (c) Rent shall not accrue for any vehicle that the Contracting 
Officer determines does not comply with the Condition of Leased Vehicles 
clause of this contract or otherwise does not comply with the 
requirements of this contract, until the vehicle is replaced or the 
defects are corrected.
    (d) Rent shall not accrue for any vehicle during any period when the 
vehicle is unavailable or unusable as a result of the Contractor's 
failure to render services for the operation and maintenance of the 
vehicle as prescribed by this contract.
    (e) Rent stated in monthly terms shall be prorated on the basis of 
1/30th of the monthly rate for each day the vehicle is in the 
Government's possession. If this contract contains a mileage provision, 
the Government shall pay rent as provided in the Schedule.

                             (End of clause)



Sec.  52.208-5  Condition of Leased Vehicles.

    As prescribed in 8.1104(b), insert the following clause in 
solicitations and contracts for leasing motor vehicles, unless the motor 
vehicles are leased in foreign countries:

                 Condition of Leased Vehicles (APR 1984)

    Each vehicle furnished under this contract shall be of good quality 
and in safe operating condition, and shall comply with the Federal Motor 
Vehicle Safety Standards (49 CFR 571) and State safety regulations 
applicable to the vehicle. The Government shall accept or reject the 
vehicles promptly after receipt. If the Contracting Officer determines 
that any vehicle furnished is not in compliance with this contract, the 
Contracting Officer shall promptly inform the Contractor in writing. If 
the Contractor fails to replace the vehicle or correct the defects as 
required by the Contracting Officer, the Government may (a) by contract 
or otherwise, correct the defect or arrange for the lease of a similar 
vehicle and shall charge or set off against the Contractor any excess 
costs occasioned thereby, or (b) terminate the contract under the 
Default clause of this contract.

                             (End of clause)



Sec.  52.208-6  Marking of Leased Vehicles.

    As prescribed in 8.1104(c), insert the following clause in 
solicitations and contracts for leasing motor vehicles, unless the motor 
vehicles are leased in foreign countries:

                  Marking of Leased Vehicles (APR 1984)

    (a) The Government may place nonpermanent markings or decals, 
identifying the using agency, on each side, and on the front and rear 
bumpers, of any motor vehicle leased under this contract. The Government 
shall use markings or decals that are removable without damage to the 
vehicle.
    (b) The Contractor may use placards for temporary identification of 
vehicles except that the placards may not contain any references to the 
Contractor that may be construed as advertising or endorsement by the 
Government of the Contractor.

                             (End of clause)



Sec.  52.208-7  Tagging of Leased Vehicles.

    As prescribed in 8.1104(d), insert a clause substantially as 
follows:

                  Tagging of Leased Vehicles (MAY 1986)

    While it is the intent that vehicles leased under this contract will 
operate on Federal tags, the Government reserves the right to utilize 
State tags if necessary to accomplish its mission. Should State tags be 
required, the Contractor shall furnish the Government documentation 
necessary to allow acquisition of such tags. Federal tags are the 
responsibility of the Government.

                             (End of clause)

[51 FR 19717, May 30, 1986]



Sec.  52.208-8  Required Sources for Helium and Helium Usage Data.

    As prescribed in 8.505, insert the following clause:

      Required Sources for Helium and Helium Usage Data (Apr 2002)

    (a) Definitions.
    Bureau of Land Management, as used in this clause, means the 
Department of the Interior, Bureau of Land Management, Amarillo Field 
Office, Helium Operations, located at 801 South Fillmore Street, Suite 
500, Amarillo, TX 79101-3545.
    Federal helium supplier means a private helium vendor that has an 
in-kind crude helium sales contract with the Bureau of Land Management 
(BLM) and that is on the BLM

[[Page 33]]

Amarillo Field Office's Authorized List of Federal Helium Suppliers 
available via the Internet at http://www.nm.blm.gov/www/amfo/amfo--
home.html.
    Major helium requirement means an estimated refined helium 
requirement greater than 200,000 standard cubic feet (scf) (measured at 
14.7 pounds per square inch absolute pressure and 70 degrees Fahrenheit 
temperature) of gaseous helium or 7510 liters of liquid helium delivered 
to a helium use location per year.
    (b) Requirements--(1) Contractors must purchase major helium 
requirements from Federal helium suppliers, to the extent that supplies 
are available.
    (2) The Contractor shall provide to the Contracting Officer the 
following data within 10 days after the Contractor or subcontractor 
receives a delivery of helium from a Federal helium supplier--
    (i) The name of the supplier;
    (ii) The amount of helium purchased;
    (iii) The delivery date(s); and
    (iv) The location where the helium was used.
    (c) Subcontracts. The Contractor shall insert this clause, including 
this paragraph (c), in any subcontract or order that involves a major 
helium requirement.

                             (End of clause)

[67 FR 13064, Mar. 20, 2002]



Sec.  52.208-9  Contractor Use of Mandatory Sources of Supply or Services.

    As prescribed in 8.004, insert the following clause:

  Contractor Use of Mandatory Sources of Supply or Services (FEB 2002)

    (c) Price and delivery information for the mandatory supplies is 
available from the Contracting Officer for the supplies obtained through 
the DLA/GSA/VA distribution facilities. For mandatory supplies or 
services that are not available from DLA/GSA/VA, price and delivery 
information is available from the appropriate central nonprofit agency. 
Payments shall be made directly to the source making delivery. Points of 
contact for JWOD central nonprofit agencies are:
    (1) National Industries for the Blind (NIB) 1901 North Beauregard 
Street, Suite 200 Alexandria, VA 22311-1705 (703) 998-0770
    (2) NISH, 2235 Cedar Lane, Vienna, VA 22182-5200 (703) 560-6800

                             (End of clause)

[61 FR 2631, Jan. 26, 1996, as amended at 61 FR 67430, Dec. 20, 1996; 66 
FR 65368, Dec. 18, 2001; 67 FR 56120, Aug. 30, 2002]



Sec.  52.209-1  Qualification Requirements.

    As prescribed in 9.206-2, insert the following clause:

                  Qualification Requirements (FEB 1995)

    (a) Definition: Qualification Requirement, as used in this clause, 
means a Government requirement for testing or other quality assurance 
demonstration that must be completed before award.
    (b) One or more qualification requirements apply to the supplies or 
services covered by this contract. For those supplies or services 
requiring qualification, whether the covered product or service is an 
end item under this contract or simply a component of an end item, the 
product, manufacturer, or source must have demonstrated that it meets 
the standards prescribed for qualification before award of this 
contract. The product, manufacturer, or source must be qualified at the 
time of award whether or not the name of the product, manufacturer, or 
source is actually included on a qualified products list, qualified 
manufacturers list, or qualified bidders list. Offerors should contact 
the agency activity designated below to obtain all requirements that 
they or their products or services, or their subcontractors or their 
products or services, must satisfy to become qualified and to arrange 
for an opportunity to demonstrate their abilities to meet the standards 
specified for qualification.

(Name)__________________________________________________________________
(Address)_______________________________________________________________
    (c) If an offeror, manufacturer, source, product or service covered 
by a qualification requirement has already met the standards specified, 
the relevant information noted below should be provided.

Offeror's Name__________________________________________________________
Manufacturer's Name_____________________________________________________
Source's Name___________________________________________________________
Item Name_______________________________________________________________
Service Identification__________________________________________________
Test Number_____________________________________________________________
(to the extent known)
    (d) Even though a product or service subject to a qualification 
requirement is not itself an end item under this contract, the product, 
manufacturer, or source must nevertheless be qualified at the time of 
award of this contract. This is necessary whether the Contractor or a 
subcontractor will ultimately provide the product or service in 
question. If, after award, the Contracting Officer discovers that an 
applicable qualification requirement was not in fact met at the time of 
award, the Contracting Officer may either terminate this contract for 
default or allow performance to continue if adequate consideration is 
offered and the action is determined to be otherwise in the Government's 
best interests.

[[Page 34]]

    (e) If an offeror, manufacturer, source, product or service has met 
the qualification requirement but is not yet on a qualified products 
list, qualified manufacturers list, or qualified bidders list, the 
offeror must submit evidence of qualification prior to award of this 
contract. Unless determined to be in the Government's interest, award of 
this contract shall not be delayed to permit an offeror to submit 
evidence of qualification.
    (f) Any change in location or ownership of the plant where a 
previously qualified product or service was manufactured or performed 
requires reevaluation of the qualification. Similarly, any change in 
location or ownership of a previously qualified manufacturer or source 
requires reevaluation of the qualification. The reevaluation must be 
accomplished before the date of award.

                             (End of clause)

[53 FR 34229, Sept. 2, 1988; 53 FR 36028, Sept. 16, 1988, as amended at 
59 FR 67056, Dec. 28, 1994]



Sec.  52.209-3  First Article Approval--Contractor Testing.

    As prescribed in 9.308-1 (a) and (b), insert the following clause:

          First Article Approval--Contractor Testing (SEP 1989)

               [Contracting Officer shall insert details]

    (a) The Contractor shall test -- unit(s) of Lot/Item -- as specified 
in this contract. At least -- calendar days before the beginning of 
first article tests, the Contractor shall notify the Contracting 
Officer, in writing, of the time and location of the testing so that the 
Government may witness the tests.
    (b) The Contractor shall submit the first article test report within 
-- calendar days from the date of this contract to -- [insert address of 
the Government activity to receive the report] marked ``FIRST ARTICLE 
TEST REPORT: Contract No. ----, Lot/Item No. ----.'' Within -- calendar 
days after the Government receives the test report, the Contracting 
Officer shall notify the Contractor, in writing, of the conditional 
approval, approval, or disapproval of the first article. The notice of 
conditional approval or approval shall not relieve the Contractor from 
complying with all requirements of the specifications and all other 
terms and conditions of this contract. A notice of conditional approval 
shall state any further action required of the Contractor. A notice of 
disapproval shall cite reasons for the disapproval.
    (c) If the first article is disapproved, the Contractor, upon 
Government request, shall repeat any or all first article tests. After 
each request for additional tests, the Contractor shall make any 
necessary changes, modifications, or repairs to the first article or 
select another first article for testing. All costs related to these 
tests are to be borne by the Contractor, including any and all costs for 
additional tests following a disapproval. The Contractor shall then 
conduct the tests and deliver another report to the Government under the 
terms and conditions and within the time specified by the Government. 
The Government shall take action on this report within the time 
specified in paragraph (b) above. The Government reserves the right to 
require an equitable adjustment of the contract price for any extension 
of the delivery schedule, or for any additional costs to the Government 
related to these tests.
    (d) If the Contractor fails to deliver any first article report on 
time, or the Contracting Officer disapproves any first article, the 
Contractor shall be deemed to have failed to make delivery within the 
meaning of the Default clause of this contract.
    (e) Unless otherwise provided in the contract, and if the approved 
first article is not consumed or destroyed in testing, the Contractor 
may deliver the approved first article as part of the contract quantity 
if it meets all contract requirements for acceptance.
    (f) If the Government does not act within the time specified in 
paragraph (b) or (c) above, the Contracting Officer shall, upon timely 
written request from the Contractor, equitably adjust under the Changes 
clause of this contract the delivery or performance dates and/or the 
contract price, and any other contractual term affected by the delay.
    (g) Before first article approval, the acquisition of materials or 
components for, or the commencement of production of, the balance of the 
contract quantity is at the sole risk of the Contractor. Before first 
article approval, the costs thereof shall not be allocable to this 
contract for (1) progress payments, or (2) termination settlements if 
the contract is terminated for the convenience of the Government.
    (h) The Government may waive the requirement for first article 
approval test where supplies identical or similar to those called for in 
the schedule have been previously furnished by the offeror/contractor 
and have been accepted by the Government. The offeror/contractor may 
request a waiver.

                             (End of clause)

    Alternate I (JAN 1997). As prescribed in 9.308-1 (a)(2) and (b)(2), 
add the following paragraph (i) to the basic clause:

    (i) The Contractor shall produce both the first article and the 
production quantity at the same facility.


[[Page 35]]


    Alternate II (SEP 1989). As prescribed in 9.308-1 (a)(3) and (b)(3), 
substitute the following paragraph (g) for paragraph (g) of the basic 
clause:

    (g) Before first article approval, the Contracting Officer may, by 
written authorization, authorize the Contractor to acquire specific 
materials or components or to commence production to the extent 
essential to meet the delivery schedules. Until first article approval 
is granted, only costs for the first article and costs incurred under 
this authorization are allocable to this contract for (1) progress 
payments, or (2) termination settlements if the contract is terminated 
for the convenience of the Government. If first article tests reveal 
deviations from contract requirements, the Contractor shall, at the 
location designated by the Government, make the required changes or 
replace all items produced under this contract at no change in the 
contract price.

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 34757, Aug. 21, 1989; 
55 FR 25531, June 21, 1990; 62 FR 238, Jan. 2, 1997]



Sec.  52.209-4  First Article Approval--Government Testing.

    As prescribed in 9.308-2 (a) and (b), insert the following clause:

          First Article Approval--Government Testing (SEP 1989)

               [Contracting Officer shall insert details]

    (a) The Contractor shall deliver -- units(s) of Lot/Item ---- within 
-- calendar days from the date of this contract to the Government at --
---- [insert name and address of the testing facility] for first article 
tests. The shipping documentation shall contain this contract number and 
the Lot/Item identification. The characteristics that the first article 
must meet and the testing requirements are specified elsewhere in this 
contract.
    (b) Within -- calendar days after the Government receives the first 
article, the Contracting Officer shall notify the Contractor, in 
writing, of the conditional approval, approval, or disapproval of the 
first article. The notice of conditional approval or approval shall not 
relieve the Contractor from complying with all requirements of the 
specifications and all other terms and conditions of this contract. A 
notice of conditional approval shall state any further action required 
of the Contractor. A notice of disapproval shall cite reasons for the 
disapproval.
    (c) If the first article is disapproved, the Contractor, upon 
Government request, shall submit an additional first article for 
testing. After each request, the Contractor shall make any necessary 
changes, modifications, or repairs to the first article or select 
another first article for testing. All costs related to these tests are 
to be borne by the Contractor, including any and all costs for 
additional tests following a disapproval. The Contractor shall furnish 
any additional first article to the Government under the terms and 
conditions and within the time specified by the Government. The 
Government shall act on this first article within the time limit 
specified in paragraph (b) above. The Government reserves the right to 
require an equitable adjustment of the contract price for any extension 
of the delivery schedule or for any additional costs to the Government 
related to these tests.
    (d) If the Contractor fails to deliver any first article on time, or 
the Contracting Officer disapproves any first article, the Contractor 
shall be deemed to have failed to make delivery within the meaning of 
the Default clause of this contract.
    (e) Unless otherwise provided in the contract, the Contractor--
    (1) May deliver the approved first article as a part of the contract 
quantity, provided it meets all contract requirements for acceptance and 
was not consumed or destroyed in testing; and
    (2) Shall remove and dispose of any first article from the 
Government test facility at the Contractor's expense.
    (f) If the Government does not act within the time specified in 
paragraph (b) or (c) above, the Contracting Officer shall, upon timely 
written request from the Contractor, equitably adjust under the Changes 
clause of this contract the delivery or performance dates and/or the 
contract price, and any other contractual term affected by the delay.
    (g) The Contractor is responsible for providing operating and 
maintenance instructions, spare parts support, and repair of the first 
article during any first article test.
    (h) Before first article approval, the acquisition of materials or 
components for, or the commencement of production of, the balance of the 
contract quantity is at the sole risk of the Contractor. Before first 
article approval, the costs thereof shall not be allocable to this 
contract for (1) progress payments, or (2) termination settlements if 
the contract is terminated for the convenience of the Government.
    (i) The Government may waive the requirement for first article 
approval test where supplies identical or similar to those called for in 
the schedule have been previously furnished by the Offeror/Contractor 
and have been accepted by the Government. The Offeror/Contractor may 
request a waiver.

                             (End of clause)

    Alternate I (JAN 1997). As prescribed in 9.308-2 (a)(2) and (b)(2), 
add the following paragraph (j) to the basic clause:


[[Page 36]]


    (j) The Contractor shall produce both the first article and the 
production quantity at the same facility.

    Alternate II (SEP 1989). As prescribed in 9.308-2 (a)(3) and (b)(3) 
substitute the following paragraph (h) for paragraph (h) of the basic 
clause:

    (h) Before first article approval, the Contracting Officer may, by 
written authorization, authorize the Contractor to acquire specific 
materials or components or to commence production to the extent 
essential to meet the delivery schedules. Until first article approval 
is granted, only costs for the first article and costs incurred under 
this authorization are allocable to this contract for (1) progress 
payments, or (2) termination settlements if the contract is terminated 
for the convenience of the Government. If first article tests reveal 
deviations from contract requirements, the Contractor shall, at the 
location designated by the Government, make the required changes or 
replace all items produced under this contract at no change in the 
contract price.

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 34757, Aug. 21, 1989; 
62 FR 238, Jan. 2, 1997]



Sec.  52.209-5  Certification Regarding Debarment, Suspension, Proposed Debarment, 
and Other Responsibility Matters.

    As prescribed in 9.409(a), insert the following provision:

 Certification Regarding Debarment, Suspension, Proposed Debarment, And 
                 Other Responsibility Matters (DEC 2001)

    (a)(1) The Offeror certifies, to the best of its knowledge and 
belief, that--
    (i) The Offeror and/or any of its Principals--
    (A) Are ( ) are not ( ) presently debarred, suspended, proposed for 
debarment, or declared ineligible for the award of contracts by any 
Federal agency;
    (B) Have ( ) have not ( ), within a three-year period preceding this 
offer, been convicted of or had a civil judgment rendered against them 
for: commission of fraud or a criminal offense in connection with 
obtaining, attempting to obtain, or performing a public (Federal, state, 
or local) contract or subcontract; violation of Federal or state 
antitrust statutes relating to the submission of offers; or commission 
of embezzlement, theft, forgery, bribery, falsification or destruction 
of records, making false statements, tax evasion, or receiving stolen 
property; and
    (C) Are ( ) are not ( ) presently indicted for, or otherwise 
criminally or civilly charged by a governmental entity with, commission 
of any of the offenses enumerated in subdivision (a)(1)(i)(B) of this 
provision.
    (ii) The Offeror has ( ) has not ( ), within a 3-year period 
preceding this offer, had one or more contracts terminated for default 
by any Federal agency.
    (2) Principals, for the purposes of this certification, means 
officers; directors; owners; partners; and, persons having primary 
management or supervisory responsibilities within a business entity 
(e.g., general manager; plant manager; head of a subsidiary, division, 
or business segment, and similar positions).
    This certification concerns a matter within the jurisdiction of an 
agency of the United States and the making of a false, fictitious, or 
fraudulent certification may render the maker subject to prosecution 
under section 1001, title 18, United States Code.
    (b) The Offeror shall provide immediate written notice to the 
Contracting Officer if, at any time prior to contract award, the Offeror 
learns that its certification was erroneous when submitted or has become 
erroneous by reason of changed circumstances.
    (c) A certification that any of the items in paragraph (a) of this 
provision exists will not necessarily result in withholding of an award 
under this solicitation. However, the certification will be considered 
in connection with a determination of the Offeror's responsibility. 
Failure of the Offeror to furnish a certification or provide such 
additional information as requested by the Contracting Officer may 
render the Offeror nonresponsible.
    (d) Nothing contained in the foregoing shall be construed to require 
establishment of a system of records in order to render, in good faith, 
the certification required by paragraph (a) of this provision. The 
knowledge and information of an Offeror is not required to exceed that 
which is normally possessed by a prudent person in the ordinary course 
of business dealings.
    (e) The certification in paragraph (a) of this provision is a 
material representation of fact upon which reliance was placed when 
making award. If it is later determined that the Offeror knowingly 
rendered an erroneous certification, in addition to other remedies 
available to the Government, the Contracting Officer may terminate the 
contract resulting from this solicitation for default.

                           (End of provision)

[54 FR 19827, May 8, 1989, as amended at 61 FR 2633, Jan. 26, 1996; 65 
FR 80265, Dec. 20, 2000; 66 FR 17756, Apr. 3, 2001; 66 FR 66986, 66990, 
Dec. 27, 2001]

[[Page 37]]



Sec.  52.209-6  Protecting the Government's Interest When Subcontracting 
With Contractors Debarred, Suspended, or Proposed for Debarment.

    As prescribed in 9.409(b), insert the following clause:

     Protecting the Government's Interest When Subcontracting With 
  Contractors Debarred, Suspended, or Proposed for Debarment (JUL 1995)

    (a) The Government suspends or debars Contractors to protect the 
Government's interests. The Contractor shall not enter into any 
subcontract in excess of $25,000 with a Contractor that is debarred, 
suspended, or proposed for debarment unless there is a compelling reason 
to do so.
    (b) The Contractor shall require each proposed first-tier 
subcontractor, whose subcontract will exceed $25,000, to disclose to the 
Contractor, in writing, whether as of the time of award of the 
subcontract, the subcontractor, or its principals, is or is not 
debarred, suspended, or proposed for debarment by the Federal 
Government.
    (c) A corporate officer or a designee of the Contractor shall notify 
the Contracting Officer, in writing, before entering into a subcontract 
with a party that is debarred, suspended, or proposed for debarment (see 
FAR 9.404 for information on the List of Parties Excluded From Federal 
Procurement and Nonprocurement Programs). The notice must include the 
following:
    (1) The name of the subcontractor.
    (2) The Contractor's knowledge of the reasons for the subcontractor 
being on the List of Parties Excluded From Federal Procurement and 
Nonprocurement Programs.
    (3) The compelling reason(s) for doing business with the 
subcontractor notwithstanding its inclusion on the List of Parties 
Excluded From Federal Procurement and Nonprocurement Programs.
    (4) The systems and procedures the Contractor has established to 
ensure that it is fully protecting the Government's interests when 
dealing with such subcontractor in view of the specific basis for the 
party's debarment, suspension, or proposed debarment.

                             (End of clause)

[56 FR 29138, June 25, 1991, as amended at 57 FR 44269, Sept. 24, 1992; 
60 FR 33066, June 26, 1995; 60 FR 34761, July 3, 1995]




Sec.  52.211-1  Availability of Specifications Listed in the GSA Index 
of Federal Specifications, Standards and Commercial Item Descriptions, 
FPMR Part 101-29.

    As prescribed in 11.204(a), insert the following provision:

   Availability of Specifications Listed in the GSA Index of Federal 
 Specifications, Standards and Commercial Item Descriptions, FPMR Part 
                            101-29 (AUG 1998)

    (a) The GSA Index of Federal Specifications, Standards and 
Commercial Item Descriptions, FPMR Part 101-29, and copies of 
specifications, standards, and commercial item descriptions cited in 
this solicitation may be obtained for a fee by submitting a request to--
GSA Federal Supply Service, Specifications Section, Suite 8100, 470 East 
L'Enfant Plaza, SW, Washington, DC 20407, Telephone (202) 619-8925, 
Facsimile (202) 619-8978.
    (b) If the General Services Administration, Department of 
Agriculture, or Department of Veterans Affairs issued this solicitation, 
a single copy of specifications, standards, and commercial item 
descriptions cited in this solicitation may be obtained free of charge 
by submitting a request to the addressee in paragraph (a) of this 
provision. Additional copies will be issued for a fee.

                           (End of provision)

[63 FR 34063, June 22, 1998]




Sec.  52.211-2   Availability of Specifications Listed in the DoD Index of 
Specifications and Standards (DoDISS) and descriptions listed in the Acquisition 
          Management Systems and Data Requirements Control List, DoD 
          5010.12-L.

    As prescribed in 11.204(b), insert the following provision:

Availability of Specifications Listed in the DOD Index of Specifications 
   and Standards (DODISS) and Descriptions Listed in the Acquisition 
  Management Systems and Data Requirements Control List, DOD 5010.12-L 
                               (DEC 1999)

    Copies of specifications, standards, and data item descriptions 
cited in this solicitation may be obtained--
    (a) From the ASSIST database via the Internet at http://
assist.daps.mil; or
    (b) By submitting a request to the--Department of Defense Single 
Stock Point (DoDSSP), Building 4, Section D, 700 Robbins Avenue, 
Philadelphia, PA 19111-5094, Telephone (215) 697-2667/2179, Facsimile 
(215) 697-1462.

                           (End of provision)

[64 FR 72446, Dec. 27, 1999]

[[Page 38]]



Sec.  52.211-3  Availability of Specifications Not Listed in the GSA Index 
of Federal Specifications, Standards and Commercial Item Descriptions.

    As prescribed in 11.204(c), insert a provision substantially the 
same as the following:

 Availability of Specifications Not Listed in the GSA Index of Federal 
  Specifications, Standards and Commercial Item Descriptions (JUN 1988)

    The specifications cited in this solicitation may be obtained from:
(Activity) address)_____________________________________________________
________________________________________________________________________
________________________________________________________________________
(Telephone number)______________________________________________________
(Person to be contacted)________________________________________________
    The request should identify the solicitation number and the 
specification requested by date, title, and number, as cited in the 
solicitation.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 53 FR 17860, May 18, 1988. 
Redesignated and amended at 60 FR 48251, 48256, Sept. 18, 1995; 61 FR 
31663, June 20, 1996]




Sec.  52.211-4  Availability for Examination of Specifications Not Listed 
in the GSA Index of Federal Specifications, Standards and Commercial Item 
          Descriptions.

    As prescribed in 11.204(d), insert a provision substantially the 
same as the following:

  Availability for Examination of Specifications Not Listed in the GSA 
     Index of Federal Specifications, Standards and Commercial Item 
                         Descriptions (JUN 1988)

    The specifications cited in this solicitation are not available for 
distribution. However, they may be examined at the following 
location(s):
(ACTIVITY)______________________________________________________________
(COMPLETE ADDRESS)______________________________________________________
________________________________________________________________________
________________________________________________________________________
(TELEPHONE NUMBER)______________________________________________________
(PERSON TO BE CONTACTED)________________________________________________
(TIME(S) FOR VIEWING)___________________________________________________

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 53 FR 17860, May 18, 1988. 
Redesignated and amended at 60 FR 48251, 48256, Sept. 18, 1995; 61 FR 
67430, Dec. 20, 1996]



Sec.  52.211-5  Material Requirements.

    As prescribed in 11.304, insert the following clause:

                    Material Requirements (AUG 2000)

    (a) Definitions.
    As used in this clause--
    New means composed of previously unused components, whether 
manufactured from virgin material, recovered material in the form of raw 
material, or materials and by-products generated from, and reused 
within, an original manufacturing process; provided that the supplies 
meet contract requirements, including but not limited to, performance, 
reliability, and life expectancy.
    Reconditioned means restored to the original normal operating 
condition by readjustments and material replacement.
    Recovered material means waste materials and by-products recovered 
or diverted from solid waste, but the term does not include those 
materials and by-products generated from, and commonly reused within, an 
original manufacturing process.
    Remanufactured means factory rebuilt to original specifications.
    Virgin material means--
    (1) Previously unused raw material, including previously unused 
copper, aluminum, lead, zinc, iron, other metal or metal ore; or
    (2) Any undeveloped resource that is, or with new technology will 
become, a source of raw materials.
    (b) Unless this contract otherwise requires virgin material or 
supplies composed of or manufactured from virgin material, the 
Contractor shall provide supplies that are new, reconditioned, or 
remanufactured, as defined in this clause.
    (c) A proposal to provide unused former Government surplus property 
shall include a complete description of the material, the quantity, the 
name of the Government agency from which acquired, and the date of 
acquisition.
    (d) A proposal to provide used, reconditioned, or remanufactured 
supplies shall include a detailed description of such supplies and shall 
be submitted to the Contracting Officer for approval.
    (e) Used, reconditioned, or remanufactured supplies, or unused 
former Government surplus property, may be used in contract performance 
if the Contractor has proposed the use of such supplies, and the 
Contracting Officer has authorized their use.

                             (End of clause)

[62 FR 44812, Aug. 22, 1997, as amended at 65 FR 36021, June 6, 2000]

[[Page 39]]



Sec.  52.211-6  Brand name or equal.

    As prescribed in 11.107(a), insert the following provision:

                     Brand Name or Equal (AUG 1999)

    (a) If an item in this solicitation is identified as ``brand name or 
equal,'' the purchase description reflects the characteristics and level 
of quality that will satisfy the Government's needs. The salient 
physical, functional, or performance characteristics that ``equal'' 
products must meet are specified in the solicitation.
    (b) To be considered for award, offers of ``equal'' products, 
including ``equal'' products of the brand name manufacturer, must--
    (1) Meet the salient physical, functional, or performance 
characteristic 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 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.
    (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 obtaining any information not 
identified in the offer.
    (d) Unless the offeror clearly indicates in its offer that the 
product being offered is an ``equal'' product, the offeror shall provide 
the brand name product referenced in the solicitation.

                           (End of provision)

[64 FR 32742, June 17, 1999, as amended at 64 FR 51850, Sept. 24, 1999; 
64 FR 53264, Oct. 1, 1999]



Sec.  Sec.  52.211-7   Alternatives to Government-unique standards.

    As prescribed in 11.107(b), insert the following provision:

         Alternatives to Government-Unique Standards (NOV 1999)

    (a) This solicitation includes Government-unique standards. The 
offeror may propose voluntary consensus standards that meet the 
Government's requirements as alternatives to the Government-unique 
standards. The Government will accept use of the voluntary consensus 
standard instead of the Government-unique standard if it meets the 
Government's requirements unless inconsistent with law or otherwise 
impractical.
    (b) If an alternative standard is proposed, the offeror must furnish 
data and/or information regarding the alternative in sufficient detail 
for the Government to determine if it meets the Government's 
requirements. Acceptance of the alternative standard is a unilateral 
decision made solely at the discretion of the Government.
    (c) Offers that do not comply with the Government-unique standards 
specified in this solicitation may be determined to be nonresponsive or 
unacceptable. The offeror may submit an offer that complies with the 
Government-unique standards specified in this solicitation, in addition 
to any proposed alternative standard(s).

                           (End of provision)

[64 FR 51853, Sept. 24, 1999]



Sec.  52.211-8  Time of Delivery.

    As prescribed in 11.404(a)(2), insert the following clause:

                       Time of Delivery (JUN 1997)

    (a) The Government requires delivery to be made according to the 
following schedule:

                       REQUIRED DELIVERY SCHEDULE
              [Contracting Officer insert specific details]
------------------------------------------------------------------------
                                                  WITHIN DAYS AFTER DATE
        ITEM NO.                 QUANTITY               OF CONTRACT
------------------------------------------------------------------------
----------               ----------               ----------
----------               ----------               ----------
----------               ----------               ----------
------------------------------------------------------------------------

    The Government will evaluate equally, as regards time of delivery, 
offers that propose delivery of each quantity within the applicable 
delivery period specified above. Offers that propose delivery that will 
not clearly fall within the applicable required delivery period 
specified above, will be considered nonresponsive and rejected. The 
Government reserves the right to award under either the required 
delivery schedule or the proposed delivery schedule, when an offeror 
offers an earlier delivery schedule than required above. If the offeror 
proposes no other delivery schedule, the required delivery schedule 
above will apply.

                  OFFEROR'S PROPOSED DELIVERY SCHEDULE
------------------------------------------------------------------------
                                                  WITHIN DAYS AFTER DATE
        ITEM NO.                 QUANTITY               OF CONTRACT
------------------------------------------------------------------------
----------               ----------               ----------

[[Page 40]]

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

    (b) Attention is directed to the Contract Award provision of the 
solicitation that provides that a written award or acceptance of offer 
mailed, or otherwise furnished to the successful offeror, results in a 
binding contract. The Government will mail or otherwise furnish to the 
offeror an award or notice of award not later than the day award is 
dated. Therefore, the offeror should compute the time available for 
performance beginning with the actual date of award, rather than the 
date the written notice of award is received from the Contracting 
Officer through the ordinary mails. However, the Government will 
evaluate an offer that proposes delivery based on the Contractor's date 
of receipt of the contract or notice of award by adding (1) five 
calendar days for delivery of the award through the ordinary mails, or 
(2) one working day if the solicitation states that the contract or 
notice of award will be transmitted electronically. (The term working 
day excludes weekends and U.S. Federal holidays.) If, as so computed, 
the offered delivery date is later than the required delivery date, the 
offer will be considered nonresponsive and rejected.

                             (End of clause)

    Alternate I (APR 1984). If the delivery schedule is expressed in 
terms of specific calendar dates or specific periods and is based on an 
assumed date of award, the contracting officer may substitute the 
following paragraph (b) for paragraph (b) of the basic clause. The time 
may be expressed by substituting on or before; during the months --; or 
not sooner than -- or later than -- as headings for the third column of 
paragraph (a) the basic clause.

    (b) The delivery dates or specific periods above are based on the 
assumption that the Government will make award by ---- [Contracting 
Officer insert date]. Each delivery date in the delivery schedule above 
will be extended by the number of calendar days after the above date 
that the contract is in fact awarded. Attention is directed to the 
Contract Award provision of the solicitation that provides that a 
written award or acceptance of offer mailed or otherwise furnished to 
the successful offeror results in a binding contract. Therefore, the 
offeror should compute the time available for performance beginning with 
the actual date of award, rather than the date the written notice of 
award is received from the Contracting Officer through the ordinary 
mails.

    Alternate II (APR 1984). If the delivery schedule is expressed in 
terms of specific calendar dates or specific periods and is based on an 
assumed date the contractor will receive notice of award, the 
contracting officer may substitute the following paragraph (b) for 
paragraph (b) of the basic clause. The time may be expressed by 
substituting within days after the date of receipt of a written notice 
of award as the heading for the third column of paragraph (a) of the 
basic clause.

    (b) The delivery dates or specific periods above are based on the 
assumption that the successful offeror will receive notice of award by 
---- [Contracting Officer insert date]. Each delivery date in the 
delivery schedule above will be extended by the number of calendar days 
after the above date that the Contractor receives notice of award; 
provided, that the Contractor promptly acknowledges receipt of notice of 
award.

    Alternate III (APR 1984). If the delivery schedule is to be based on 
the actual date the contractor receives a written notice of award, the 
contracting officer may delete paragraph (b) of the basic clause. The 
time may be expressed by substituting within days after the date of 
receipt of a written notice of award as the heading for the third column 
of paragraph (a) of the basic clause.

[48 FR 42478, Sept. 19, 1983, as amended at 56 FR 41732, Aug. 22, 1991; 
60 FR 34739, July 3, 1995. Redesignated and amended at 60 FR 48251, 
48256, Sept. 18, 1995; 62 FR 40238, July 25, 1997]



Sec.  52.211-9  Desired and Required Time of Delivery.

    As prescribed in 11.404(a)(3), insert the following clause:

            Desired and Required Time of Delivery (JUN 1997)

    (a) The Government desires delivery to be made according to the 
following schedule:

[[Page 41]]



                        DESIRED DELIVERY SCHEDULE
              [Contracting Officer insert specific details]
------------------------------------------------------------------------
                                                  WITHIN DAYS AFTER DATE
        ITEM NO.                 QUANTITY               OF CONTRACT
------------------------------------------------------------------------
--------                 --------                 --------
--------                 --------                 --------
--------                 --------                 --------
------------------------------------------------------------------------

    If the offeror is unable to meet the desired delivery schedule, it 
may, without prejudicing evaluation of its offer, propose a delivery 
schedule below. However, the offeror's proposed delivery schedule must 
not extend the delivery period beyond the time for delivery in the 
Government's required delivery schedule as follows:

                       REQUIRED DELIVERY SCHEDULE
              [Contracting Officer insert specific details]
------------------------------------------------------------------------
                                                  WITHIN DAYS AFTER DATE
        ITEM NO.                 QUANTITY               OF CONTRACT
------------------------------------------------------------------------
----------               ----------               ----------
----------               ----------               ----------
----------               ----------               ----------
------------------------------------------------------------------------

    Offers that propose delivery of a quantity under such terms or 
conditions that delivery will not clearly fall within the applicable 
required delivery period specified above, will be considered 
nonresponsive and rejected. If the offeror proposes no other delivery 
schedule, the desired delivery schedule above will apply.

                  OFFEROR'S PROPOSED DELIVERY SCHEDULE
------------------------------------------------------------------------
                                                  WITHIN DAYS AFTER DATE
        ITEM NO.                 QUANTITY               OF CONTRACT
------------------------------------------------------------------------
----------               ----------               ----------
----------               ----------               ----------
----------               ----------               ----------
------------------------------------------------------------------------

    (b) Attention is directed to the Contract Award provision of the 
solicitation that provides that a written award or acceptance of offer 
mailed or otherwise furnished to the successful offeror results in a 
binding contract. The Government will mail or otherwise furnish to the 
offeror an award or notice of award not later than the day the award is 
dated. Therefore, the offeror shall compute the time available for 
performance beginning with the actual date of award, rather than the 
date the written notice of award is received from the Contracting 
Officer through the ordinary mails. However, the Government will 
evaluate an offer that proposes delivery based on the Contractor's date 
of receipt of the contract or notice of award by adding (1) five 
calendar days for delivery of the award through the ordinary mails, or 
(2) one working day if the solicitation states that the contract or 
notice of award will be transmitted electronically. (The term working 
day excludes weekends and U.S. Federal holidays.) If, as so computed, 
the offered delivery date is later than the required delivery date, the 
offer will be considered nonresponsive and rejected.

                             (End of clause)

    Alternate I (APR 1984). If the delivery schedule is expressed in 
terms of specific calendar dates or specific periods and is based on an 
assumed date of award, the contracting officer may substitute the 
following paragraph (b) for paragraph (b) of the basic clause. The time 
may be expressed by substituting on or before; during the months ----; 
or not sooner than ----, or later than ---- as headings for the third 
column of paragraph (a) of the basic clause.

    (b) The delivery dates or specific periods above are based on the 
assumption that the Government will make award by ---- [Contracting 
Officer insert date]. Each delivery date in the delivery schedule above 
will be extended by the number of calendar days after the above date 
that the contract is in fact awarded. Attention is directed to the 
Contract Award provision of the solicitation that provides that a 
written award or acceptance of offer mailed or otherwise furnished to 
the successful offeror results in a binding contract. Therefore, the 
offeror shall compute the time available for performance beginning with 
the actual date of award, rather than the date the written notice of 
award is received from the Contracting Officer through the ordinary 
mails.

    Alternate II (APR 1984). If the delivery schedule is expressed in 
terms of specific calendar dates or specific periods and is based on an 
assumed date the contractor receives notice of award, the contracting 
officer may substitute the following paragraph (b) for paragraph (b) of 
the basic clause. The time may be expressed by substituting within days 
after the date of receipt of a written notice of award as the heading of 
the third column of paragraph (a) of the basic clause.

    (b) The delivery dates or specific periods above are based on the 
assumption that the successful offeror will receive notice of award by 
---- [Contracting Officer insert date]. Each delivery date in the 
delivery schedule above will be extended by the number of calendar days 
after the above date that the

[[Page 42]]

Contractor receives notice of award; provided, that the Contractor 
promptly acknowledges receipt of notice of award.

    Alternate III (APR 1984). If the delivery schedule is to be based on 
the actual date the contractor receives a written notice of award, the 
contracting officer may delete paragraph (b) of the basic clause. The 
time may be expressed by substituting within days after the date of 
receipt of a written notice of award as the heading of the third column 
of paragraph (a) of the basic clause.

[48 FR 42478, Sept. 19, 1983, as amended at 56 FR 41732, Aug. 22, 1991; 
60 FR 34739, July 3, 1995. Redesignated and amended at 60 FR 48251, 
48256, Sept. 18, 1995; 62 FR 40238, July 25, 1997]



Sec.  52.211-10  Commencement, Prosecution, and Completion of Work.

    As prescribed in 11.404(b), insert the following clause in 
solicitations and contracts when a fixed-price construction contract is 
contemplated. The clause may be changed to accommodate the issuance of 
orders under indefinite-delivery contracts for construction.

      Commencement, Prosecution, and Completion of Work (APR 1984)

    The Contractor shall be required to (a) commence work under this 
contract within -- [Contracting Officer insert number] calendar days 
after the date the Contractor receives the notice to proceed, (b) 
prosecute the work diligently, and (c) complete the entire work ready 
for use not later than ----*. The time stated for completion shall 
include final cleanup of the premises.

                             (End of clause)

    *The Contracting Officer shall specify either a number of days after 
the date the contractor receives the notice to proceed, or a calendar 
date.

    Alternate I (APR 1984). If the completion date is expressed as a 
specific calendar date, computed on the basis of the contractor 
receiving the notice to proceed by a certain day, add the following 
paragraph to the basic clause:

    The completion date is based on the assumption that the successful 
offeror will receive the notice to proceed by ---- [Contracting Officer 
insert date]. The completion date will be extended by the number of 
calendar days after the above date that the Contractor receives the 
notice to proceed, except to the extent that the delay in issuance of 
the notice to proceed results from the failure of the Contractor to 
execute the contract and give the required performance and payment bonds 
within the time specified in the offer.

[48 FR 42478, Sept. 19, 1983. Redesignated and amended at 60 FR 48251, 
48256, Sept. 18, 1995]



Sec.  52.211-11  Liquidated Damages--Supplies, Services, or Research and Development.

    As prescribed in 11.503(a), insert the following clause in 
solicitations and contracts:

Liquidated Damages--Supplies, Services, or Research and Development (SEP 
                                  2000)

    (a) If the Contractor fails to deliver the supplies or perform the 
services within the time specified in this contract, the Contractor 
shall, in place of actual damages, pay to the Government liquidated 
damages of $---- per calendar day of delay [Contracting Officer insert 
amount].
    (b) If the Government terminates this contract in whole or in part 
under the Default--Fixed-Price Supply and Service clause, the Contractor 
is liable for liquidated damages accruing until the Government 
reasonably obtains delivery or performance of similar supplies or 
services. These liquidated damages are in addition to excess costs of 
repurchase under the Termination clause.
    (c) The Contractor will not be charged with liquidated damages when 
the delay in delivery or performance is beyond the control and without 
the fault or negligence of the Contractor as defined in the Default--
Fixed-Price Supply and Service clause in this contract.

                             (End of clause)

[65 FR 46067, July 26, 2000]



Sec.  52.211-12  Liquidated Damages--Construction.

    As prescribed in 11.503(b), insert the following clause in 
solicitations and contracts:

               Liquidated Damages--Construction (SEP 2000)

    (a) If the Contractor fails to complete the work within the time 
specified in the contract, the Contractor shall pay liquidated damages 
to the Government in the amount of ---- [Contracting Officer insert 
amount] for each calendar day of delay until the work is completed or 
accepted.

[[Page 43]]

    (b) If the Government terminates the Contractor's right to proceed, 
liquidated damages will continue to accrue until the work is completed. 
These liquidated damages are in addition to excess costs of repurchase 
under the Termination clause.

                             (End of clause)

[65 FR 46067, July 26, 2000]



Sec.  52.211-13  Time Extensions.

    As prescribed in 11.503(c), insert the following clause:

                       Time Extensions (SEP 2000)

    Time extensions for contract changes will depend upon the extent, if 
any, by which the changes cause delay in the completion of the various 
elements of construction. The change order granting the time extension 
may provide that the contract completion date will be extended only for 
those specific elements related to the changed work and that the 
remaining contract completion dates for all other portions of the work 
will not be altered. The change order also may provide an equitable 
readjustment of liquidated damages under the new completion schedule.

                             (End of clause)

[65 FR 46067, July 26, 2000]



Sec.  52.211-14  Notice of Priority Rating for National Defense Use.

    As prescribed in 11.604(a), insert the following provision:

      Notice of Priority Rating for National Defense Use (SEP 1990)

    Any contract awarded as a result of this solicitation will be a
[ ] DX rated order; [ ] DO rated order certified for national defense 
use under the Defense Priorities and Allocations System (DPAS) (15 CFR 
part 700), and the Contractor will be required to follow all of the 
requirements of this regulation. [Contracting Officer check appropriate 
box.]

                           (End of provision)

[51 FR 19717, May 30, 1986, as amended at 55 FR 38518, Sept. 18, 1990. 
Redesignated and amended at 60 FR 48251, 48256, Sept. 18, 1995]



Sec.  52.211-15  Defense Priority and Allocation Requirements.

    As prescribed in 11.604(b), insert the following clause:

         Defense Priority and Allocation Requirements (SEP 1990)

    This is a rated order certified for national defense use, and the 
Contractor shall follow all the requirements of the Defense Priorities 
and Allocations System regulation (15 CFR part 700).

                             (End of clause)

[51 FR 19717, May 30, 1986, as amended at 55 FR 38518, Sept. 18, 1990. 
Redesignated and amended at 60 FR 48251, 48256, Sept. 18, 1995]



Sec.  52.211-16  Variation in Quantity.

    As prescribed in 11.703(a), insert the following clause:

                    Variation in Quantity (APR 1984)

    (a) A variation in the quantity of any item called for by this 
contract will not be accepted unless the variation has been caused by 
conditions of loading, shipping, or packing, or allowances in 
manufacturing processes, and then only to the extent, if any, specified 
in paragraph (b) below.
    (b) The permissible variation shall be limited to:
-- Percent increase [Contracting Officer insert percentage]
-- Percent decrease [Contracting Officer insert percentage]
    This increase or decrease shall apply to ---- *

                             (End of clause)

    *Contracting Officer shall insert in the blank the designation(s) to 
which the percentages apply, such as (1) the total contract quantity, 
(2) item 1 only, (3) each quantity specified in the delivery schedule, 
(4) the total item quantity for each destination, or (5) the total 
quantity of each item without regard to destination.

[48 FR 42478, Sept. 19, 1983. Redesignated and amended at 60 FR 48251, 
48256, Sept. 18, 1995; 64 FR 10538, Mar. 4, 1999]



Sec.  52.211-17  Delivery of Excess Quantities.

    As prescribed in 11.703(b), insert the following clause:

                Delivery of Excess Quantities (SEP 1989)

    The Contractor is responsible for the delivery of each item quantity 
within allowable variations, if any. If the Contractor delivers and the 
Government receives quantities of any item in excess of the quantity 
called for (after considering any allowable variation in quantity), such 
excess quantities will be

[[Page 44]]

treated as being delivered for the convenience of the Contractor. The 
Government may retain such excess quantities up to $250 in value without 
compensating the Contractor therefor, and the Contractor waives all 
right, title, or interests therein. Quantities in excess of $250 will, 
at the option of the Government, either be returned at the Contractor's 
expense or retained and paid for by the Government at the contract unit 
price.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 34757, Aug. 21, 1989. 
Redesignated and amended at 60 FR 48251, 48256, Sept. 18, 1995]



Sec.  52.211-18  Variation in Estimated Quantity.

    As prescribed in 11.703(c), insert the following clause in 
solicitations and contracts when a fixed-price construction contract is 
contemplated that authorizes a variation in the estimated quantity of 
unit-priced items:

               Variation in Estimated Quantity (APR 1984)

    If the quantity of a unit-priced item in this contract is an 
estimated quantity and the actual quantity of the unit-priced item 
varies more than 15 percent above or below the estimated quantity, an 
equitable adjustment in the contract price shall be made upon demand of 
either party. The equitable adjustment shall be based upon any increase 
or decrease in costs due solely to the variation above 115 percent or 
below 85 percent of the estimated quantity. If the quantity variation is 
such as to cause an increase in the time necessary for completion, the 
Contractor may request, in writing, an extension of time, to be received 
by the Contracting Officer within 10 days from the beginning of the 
delay, or within such further period as may be granted by the 
Contracting Officer before the date of final settlement of the contract. 
Upon the receipt of a written request for an extension, the Contracting 
Officer shall ascertain the facts and make an adjustment for extending 
the completion date as, in the judgement of the Contracting Officer, is 
justified.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983. Redesignated and amended at 60 FR 48251, 
48256, Sept. 18, 1995]



Sec.  52.212-1  Instructions to Offerors--Commercial Items.

    As prescribed in 12.301(b)(1), insert the following provision:

         Instructions to Offerors--Commercial Items (Oct. 2003)

    (a) North American Industry Classification System (NAICS) code and 
small business size standard. The NAICS code and small business size 
standard for this acquisition appear in Block 10 of the solicitation 
cover sheet (SF 1449). However, the small business size standard for a 
concern which submits an offer in its own name, but which proposes to 
furnish an item which it did not itself manufacture, is 500 employees.
    (b) Submission of offers. Submit signed and dated offers to the 
office specified in this solicitation at or before the exact time 
specified in this solicitation. Offers may be submitted on the SF 1449, 
letterhead stationery, or as otherwise specified in the solicitation. As 
a minimum, offers must show--
    (1) The solicitation number;
    (2) The time specified in the solicitation for receipt of offers;
    (3) The name, address, and telephone number of the offeror;
    (4) A technical description of the items being offered in sufficient 
detail to evaluate compliance with the requirements in the solicitation. 
This may include product literature, or other documents, if necessary;
    (5) Terms of any express warranty;
    (6) Price and any discount terms;
    (7) ``Remit to'' address, if different than mailing address;
    (8) A completed copy of the representations and certifications at 
FAR 52.212-3;
    (9) Acknowledgment of Solicitation Amendments;
    (10) Past performance information, when included as an evaluation 
factor, to include recent and relevant contracts for the same or similar 
items and other references (including contract numbers, points of 
contact with telephone numbers and other relevant information); and
    (11) If the offer is not submitted on the SF 1449, include a 
statement specifying the extent of agreement with all terms, conditions, 
and provisions included in the solicitation. Offers that fail to furnish 
required representations or information, or reject the terms and 
conditions of the solicitation may be excluded from consideration.
    (c) Period for acceptance of offers. The offeror agrees to hold the 
prices in its offer firm for 30 calendar days from the date specified 
for receipt of offers, unless another time period is specified in an 
addendum to the solicitation.
    (d) Product samples. When required by the solicitation, product 
samples shall be submitted at or prior to the time specified for receipt 
of offers. Unless otherwise specified in this solicitation, these 
samples shall be submitted at no expense to the Government,

[[Page 45]]

and returned at the sender's request and expense, unless they are 
destroyed during preaward testing.
    (e) Multiple offers. Offerors are encouraged to submit multiple 
offers presenting alternative terms and conditions or commercial items 
for satisfying the requirements of this solicitation. Each offer 
submitted will be evaluated separately.
    (f) Late submissions, modifications, revisions, and withdrawals of 
offers. (1) Offerors are responsible for submitting offers, and any 
modifications, revisions, or withdrawals, so as to reach the Government 
office designated in the solicitation by the time specified in the 
solicitation. If no time is specified in the solicitation, the time for 
receipt is 4:30 p.m., local time, for the designated Government office 
on the date that offers or revisions are due.
    (2)(i) Any offer, modification, revision, or withdrawal of an offer 
received at the Government office designated in the solicitation after 
the exact time specified for receipt of offers is ``late'' and will not 
be considered unless it is received before award is made, the 
Contracting Officer determines that accepting the late offer would not 
unduly delay the acquisition; and--
    (A) If it was transmitted through an electronic commerce method 
authorized by the solicitation, it was received at the initial point of 
entry to the Government infrastructure not later than 5:00 p.m. one 
working day prior to the date specified for receipt of offers; or
    (B) There is acceptable evidence to establish that it was received 
at the Government installation designated for receipt of offers and was 
under the Government's control prior to the time set for receipt of 
offers; or
    (C) If this solicitation is a request for proposals, it was the only 
proposal received.
    (ii) However, a late modification of an otherwise successful offer, 
that makes its terms more favorable to the Government, will be 
considered at any time it is received and may be accepted.
    (3) Acceptable evidence to establish the time of receipt at the 
Government installation includes the time/date stamp of that 
installation on the offer wrapper, other documentary evidence of receipt 
maintained by the installation, or oral testimony or statements of 
Government personnel.
    (4) If an emergency or unanticipated event interrupts normal 
Government processes so that offers cannot be received at the Government 
office designated for receipt of offers by the exact time specified in 
the solicitation, and urgent Government requirements preclude amendment 
of the solicitation or other notice of an extension of the closing date, 
the time specified for receipt of offers will be deemed to be extended 
to the same time of day specified in the solicitation on the first work 
day on which normal Government processes resume.
    (5) Offers may be withdrawn by written notice received at any time 
before the exact time set for receipt of offers. Oral offers in response 
to oral solicitations may be withdrawn orally. If the solicitation 
authorizes facsimile offers, offers may be withdrawn via facsimile 
received at any time before the exact time set for receipt of offers, 
subject to the conditions specified in the solicitation concerning 
facsimile offers. An offer may be withdrawn in person by an offeror or 
its authorized representative if, before the exact time set for receipt 
of offers, the identity of the person requesting withdrawal is 
established and the person signs a receipt for the offer.
    (g) Contract award (not applicable to Invitation for Bids). The 
Government intends to evaluate offers and award a contract without 
discussions with offerors. Therefore, the offeror's initial offer should 
contain the offeror's best terms from a price and technical standpoint. 
However, the Government reserves the right to conduct discussions if 
later determined by the Contracting Officer to be necessary. The 
Government may reject any or all offers if such action is in the public 
interest; accept other than the lowest offer; and waive informalities 
and minor irregularities in offers received.
    (h) Multiple awards. The Government may accept any item or group of 
items of an offer, unless the offeror qualifies the offer by specific 
limitations. Unless otherwise provided in the Schedule, offers may not 
be submitted for quantities less than those specified. The Government 
reserves the right to make an award on any item for a quantity less than 
the quantity offered, at the unit prices offered, unless the offeror 
specifies otherwise in the offer.
    (i) Availability of requirements documents cited in the 
solicitation. (1)(i) The GSA Index of Federal Specifications, Standards 
and Commercial Item Descriptions, FPMR Part 101-29, and copies of 
specifications, standards, and commercial item descriptions cited in 
this solicitation may be obtained for a fee by submitting a request to--
GSA Federal Supply Service Specifications Section, Suite 8100, 470 East 
L'Enfant Plaza, SW, Washington, DC 20407, Telephone (202) 619-8925, 
Facsimile (202) 619-8978.
    (ii) If the General Services Administration, Department of 
Agriculture, or Department of Veterans Affairs issued this solicitation, 
a single copy of specifications, standards, and commercial item 
descriptions cited in this solicitation may be obtained free of charge 
by submitting a request to the addressee in paragraph (i)(1)(i) of this 
provision. Additional copies will be issued for a fee.
    (2) The DoD Index of Specifications and Standards (DoDISS) and 
documents listed in it may be obtained from the--Department of

[[Page 46]]

Defense Single Stock Point (DoDSSP), Building 4, Section D, 700 Robbins 
Avenue, Philadelphia, PA 19111-5094, Telephone (215) 697-2667/2179, 
Facsimile (215) 697-1462.
    (i) Automatic distribution may be obtained on a subscription basis.
    (ii) Order forms, pricing information, and customer support 
information may be obtained--
    (A) By telephone at (215) 697-2667/2179; or
    (B) Through the DoDSSP Internet site at http://dodssp.daps.mil.
    (3) Nongovernment (voluntary) standards must be obtained from the 
organization responsible for their preparation, publication, or 
maintenance.
    (j) Data Universal Numbering System (DUNS) Number. (Applies to all 
offers exceeding $25,000, and offers of $25,000 or less if the 
solicitation requires the Contractor to be registered in the Central 
Contractor Registration (CCR) database. The offeror shall enter, in the 
block with its name and address on the cover page of its offer, the 
annotation ``DUNS'' or ``DUNS +4'' followed by the DUNS or DUNS +4 
number that identifies the offeror's name and address. The DUNS +4 is 
the DUNS number plus a 4-character suffix that may be assigned at the 
discretion of the offeror to establish additional CCR records for 
identifying alternative Electronic Funds Transfer (EFT) accounts (see 
FAR Subpart 32.11) for the same parent concern. If the offeror does not 
have a DUNS number, it should contact Dun and Bradstreet directly to 
obtain one. An offeror within the United States may contact Dun and 
Bradstreet by calling 1-866-705-5711 or via the internet at http://
www.dnb.com. An offeror located outside the United States must contact 
the local Dun and Bradstreet office for a DUNS number.
    (k) Central Contractor Registration. Unless exempted by an addendum 
to this solicitation, by submission of an offer, the offeror 
acknowledges the requirement that a prospective awardee shall be 
registered in the CCR database prior to award, during performance and 
through final payment of any contract resulting from this solicitation. 
If the Offeror does not become registered in the CCR database in the 
time prescribed by the Contracting Officer, the Contracting Officer will 
proceed to award to the next otherwise successful registered Offeror. 
Offerors may obtain information on registration and annual confirmation 
requirements via the Internet at http://www.ccr.gov or by calling 1-888-
227-2423 or 269-961-5757.

                           (End of provision)

[60 FR 48251, Sept. 18, 1995, as amended at 62 FR 40238, July 25, 1997; 
63 FR 9050, Feb. 23, 1998; 63 FR 34063, June 22, 1998; 64 FR 32749, June 
17, 1999; 64 FR 51840, Sept. 24, 1999; 65 FR 16286, Mar. 27, 2000; 65 
46058, July 26, 2000; 68 FR 43875, July 24, 2003; 68 FR 56675, Oct. 1, 
2003]



Sec.  52.212-2  Evaluation--Commercial Items.

    As prescribed in 12.301(c), the Contracting Officer may insert a 
provision substantially as follows:

                 Evaluation--Commercial Items (JAN 1999)

    (a) The Government will award a contract resulting from this 
solicitation to the responsible offeror whose offer conforming to the 
solicitation will be most advantageous to the Government, price and 
other factors considered. The following factors shall be used to 
evaluate offers:
________________________________________________________________________

________________________________________________________________________
    (Contracting Officer shall insert the significant evaluation 
factors, such as (i) technical capability of the item offered to meet 
the Government requirement; (ii) price; (iii) past performance (see FAR 
15.304); (iv) small disadvantaged business participation; and include 
them in the relative order of importance of the evaluation factors, such 
as in descending order of importance.)
    Technical and past performance, when combined, are -------- 
(Contracting Officer state, in accordance with FAR 15.304, the relative 
importance of all other evaluation factors, when combined, when compared 
to price.)
    (b) Options. The Government will evaluate offers for award purposes 
by adding the total price for all options to the total price for the 
basic requirement. The Government may determine that an offer is 
unacceptable if the option prices are significantly unbalanced. 
Evaluation of options shall not obligate the Government to exercise the 
option(s).
    (c) A written notice of award or acceptance of an offer, mailed or 
otherwise furnished to the successful offeror within the time for 
acceptance specified in the offer, shall result in a binding contract 
without further action by either party. Before the offer's specified 
expiration time, the Government may accept an offer (or part of an 
offer), whether or not there are negotiations after its receipt, unless 
a written notice of withdrawal is received before award.

[[Page 47]]

                           (End of provision)

[60 FR 48252, Sept. 18, 1995, as amended at 62 FR 51271, Sept. 30, 1997; 
63 FR 36124, July 1, 1998]



Sec.  52.212-3  Offeror Representations and Certifications--Commercial Items.

    As prescribed in 12.301(b)(2), insert the following provision:

Offeror Representations and Certifications--Commercial Items (June 2003)

    (a) Definitions. As used in this provision:
    Emerging small business means a small business concern whose size is 
no greater than 50 percent of the numerical size standard for the NAICS 
code designated.
    Forced or indentured child labor means all work or service--
    (1) Exacted from any person under the age of 18 under the menace of 
any penalty for its nonperformance and for which the worker does not 
offer himself voluntarily; or
    (2) Performed by any person under the age of 18 pursuant to a 
contract the enforcement of which can be accomplished by process or 
penalties.
    Service-disabled veteran-owned small business concern--
    (1) Means a small business concern--
    (i) Not less than 51 percent of which is owned by one or more 
service--disabled veterans or, in the case of any publicly owned 
business, not less than 51 percent of the stock of which is owned by one 
or more service-disabled veterans; and
    (ii) The management and daily business operations of which are 
controlled by one or more service-disabled veterans or, in the case of a 
veteran with permanent and severe disability, the spouse or permanent 
caregiver of such veteran.
    (2) Service-disabled veteran means a veteran, as defined in 38 
U.S.C. 101(2), with a disability that is service-connected, as defined 
in 38 U.S.C. 101(16).
    Small business concern 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 criteria in 13 CFR Part 121 and size 
standards in this solicitation.
    Veteran-owned small business concern means a small business 
concern--
    (1) Not less than 51 percent of which is owned by one or more 
veterans (as defined at 38 U.S.C. 101(2)) or, in the case of any 
publicly owned business, not less than 51 percent of the stock of which 
is owned by one or more veterans; and
    (2) The management and daily business operations of which are 
controlled by one or more veterans.
    Women-owned small business concern means a small business concern--
    (1) That is at least 51 percent owned by one or more women; or, in 
the case of any publicly owned business, at least 51 percent of the 
stock of which is owned by one or more women; and
    (2) Whose management and daily business operations are controlled by 
one or more women.
    Women-owned business concern means a concern which is at least 51 
percent owned by one or more women; or in the case of any publicly owned 
business, at least 51 percent of its stock is owned by one or more 
women; and whose management and daily business operations are controlled 
by one or more women.
    (b) Taxpayer Identification Number (TIN) (26 U.S.C. 6109, 31 U.S.C. 
7701). (Not applicable if the offeror is required to provide this 
information to a central contractor registration database to be eligible 
for award.)
    (1) All offerors must submit the information required in paragraphs 
(b)(3) through (b)(5) of this provision to comply with debt collection 
requirements of 31 U.S.C. 7701(c) and 3325(d), reporting requirements of 
26 U.S.C. 6041, 6041A, and 6050M, and implementing regulations issued by 
the Internal Revenue Service (IRS).
    (2) The TIN may be used by the Government to collect and report on 
any delinquent amounts arising out of the offeror's relationship with 
the Government (31 U.S.C. 7701(c)(3)). If the resulting contract is 
subject to the payment reporting requirements described in FAR 4.904, 
the TIN provided hereunder may be matched with IRS records to verify the 
accuracy of the offeror's TIN.
    (3) Taxpayer Identification Number (TIN).

[squ] TIN:______________________________________________________________
    [squ] TIN has been applied for.
    [squ] TIN is not required because:
    [squ] Offeror is a nonresident alien, foreign corporation, or 
foreign partnership that does not have income effectively connected with 
the conduct of a 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;
    [squ] Offeror is an agency or instrumentality of a foreign 
government;
    [squ] Offeror is an agency or instrumentality of the Federal 
Government.
    (4) Type of organization.
    [squ] Sole proprietorship;
    [squ] Partnership;
    [squ] Corporate entity (not tax-exempt);
    [squ] Corporate entity (tax-exempt);
    [squ] Government entity (Federal, State, or local);
    [squ] Foreign government;
    [squ] International organization per 26 CFR 1.6049-4;

[squ] Other_____________________________________________________________

[[Page 48]]

    (5) Common parent.
    [squ] Offeror is not owned or controlled by a common parent;
    [squ] Name and TIN of common parent:

Name____________________________________________________________________

TIN_____________________________________________________________________
    (c) Offerors must complete the following representations when the 
resulting contract will be performed in the United States or its 
outlying areas. Check all that apply.
    (1) Small business concern. The offeror represents as part of its 
offer that it [squ] is, [chyph][squ] is not a small business concern.
    (2) Veteran-owned small business concern. [Complete only if the 
offeror represented itself as a small business concern in paragraph 
(c)(1) of this provision.] The offeror represents as part of its offer 
that it [ ] is, [ ] is not a veteran-owned small business concern.
    (3) Service-disabled veteran-owned small business concern. [Complete 
only if the offeror represented itself as a veteran-owned small business 
concern in paragraph (c)(2) of this provision.] The offeror represents 
as part of its offer that it [ ] is, [ ] is not a service-disabled 
veteran-owned small business concern.
    (4) Small disadvantaged business concern. [Complete only if the 
offeror represented itself as a small business concern in paragraph 
(c)(1) of this provision.] The offeror represents, for general 
statistical purposes, that it [squ] is, [squ] is not a small 
disadvantaged business concern as defined in 13 CFR 124.1002.
    (5) Women-owned small business concern. [Complete only if the 
offeror represented itself as a small business concern in paragraph 
(c)(1) of this provision.] The offeror represents that it [squ] is, 
[squ] is not a women-owned small business concern.

    Note: Complete paragraphs (c)(6) and (c)(7) only if this 
solicitation is expected to exceed the simplified acquisition threshold.

    (6) Women-owned business concern (other than small business 
concern). [Complete only if the offeror is a women-owned business 
concern and did not represent itself as a small business concern in 
paragraph (c)(1) of this provision.] The offeror represents that it 
[squ] is, a women-owned business concern.
    (7) Tie bid priority for labor surplus area concerns. If this is an 
invitation for bid, small business offerors may identify the labor 
surplus areas in which costs to be incurred on account of manufacturing 
or production (by offeror or first-tier subcontractors) amount to more 
than 50 percent of the contract price:
________________________________________________________________________
    (8) Small Business Size for the Small Business Competitiveness 
Demonstration Program and for the Targeted Industry Categories under the 
Small Business Competitiveness Demonstration Program. [Complete only if 
the offeror has represented itself to be a small business concern under 
the size standards for this solicitation.]
    (i) (Complete only for solicitations indicated in an addendum as 
being set-aside for emerging small businesses in one of the four 
designated industry groups (DIGs).) The offeror represents as part of 
its offer that it [squ] is, [squ] is not an emerging small business.
    (ii) (Complete only for solicitations indicated in an addendum as 
being for one of the targeted industry categories (TICs) or four 
designated industry groups (DIGs).) Offeror represents as follows:
    (A) Offeror's number of employees for the past 12 months (check the 
Employees column if size standard stated in the solicitation is 
expressed in terms of number of employees); or
    (B) Offeror's average annual gross revenue for the last 3 fiscal 
years (check the Average Annual Gross Number of Revenues column if size 
standard stated in the solicitation is expressed in terms of annual 
receipts)
(Check one of the following):

 
           No. of Employees                Avg. Annual Gross Revenues
 
-- 50 or fewer                          -- $1 million or less
-- 51-100                               -- $1,000,001-$2 million
-- 101-250                              -- $2,000,001-$3.5 million
-- 251-500                              -- $3,500,001-$5 million
-- 501-750                              -- $5,000,001-$10 million
-- 751-1,000                            -- $10,000,001-$17 million
-- Over 1,000                           -- Over $17 million
 

    (9) (Complete only if the solicitation contains the clause at FAR 
52.219-23, Notice of Price Evaluation Adjustment for Small Disadvantaged 
Business Concerns, or FAR 52.219-25, Small Disadvantaged Business 
Participation Program--Disadvantaged Status and Reporting, and the 
offeror desires a benefit based on its disadvantaged status.)
    (i) General. The offeror represents that either--
    (A) It /--/ is, /--/ is not certified by the Small Business 
Administration as a small disadvantaged business concern and identified, 
on the date of this representation, as a certified small disadvantaged 
business concern in the database maintained by the Small Business 
Administration (PRO-Net), and that no material change in disadvantaged 
ownership and control has occurred since its certification, and, where 
the concern is owned by one or more individuals claiming disadvantaged 
status, the net worth of each individual upon whom the certification is 
based does not exceed $750,000 after taking into account the applicable 
exclusions set forth at 13 CFR 124.104(c)(2); or
    (B) It [squ] has, [squ] has not submitted a completed application to 
the Small Business Administration or a Private Certifier to be certified 
as a small disadvantaged business concern in accordance with 13 CFR 124, 
Subpart B, and a decision on that application is pending, and that no 
material change in disadvantaged ownership and control has occurred 
since its application was submitted.
    (ii) Joint Ventures under the Price Evaluation Adjustment for Small 
Disadvantaged Business

[[Page 49]]

Concerns. The offeror represents, as part of its offer, that it is a 
joint venture that complies with the requirements in 13 CFR 124.1002(f) 
and that the representation in paragraph (c)(9)(i) of this provision is 
accurate for the small disadvantaged business concern that is 
participating in the joint venture. [The offeror shall enter the name of 
the small disadvantaged business concern that is participating in the 
joint venture: ------------.]
    (10) HUBZone small business concern. [Complete only if the offeror 
represented itself as a small business concern in paragraph (c)(1) of 
this provision.] The offeror represents, as part of its offer, that--
    (i) It [ ] is, [ ] is not a HUBZone small business concern listed, 
on the date of this representation, on the List of Qualified HUBZone 
Small Business Concerns maintained by the Small Business Administration, 
and no material change in ownership and control, principal office, or 
HUBZone employee percentage has occurred since it was certified by the 
Small Business Administration in accordance with 13 CFR part 126; and
    (ii) It [ ] is, [ ] is not a joint venture that complies with the 
requirements of 13 CFR part 126, and the representation in paragraph 
(c)(10)(i) of this provision is accurate for the HUBZone small business 
concern or concerns that are participating in the joint venture. [The 
offeror shall enter the name or names of the HUBZone small business 
concern or concerns that are participating in the joint venture:--------
----.] Each HUBZone small business concern participating on the joint 
venture shall submit a separate signed copy of the HUBZone 
representation.
    (d) Representations required to implement provisions of Executive 
Order 11246--
    (1) Previous contracts and compliance. The offeror represents that--
    (i) It [squ] has, [squ] has not participated in a previous contract 
or subcontract subject to the Equal Opportunity clause of this 
solicitation; and
    (ii) It [squ] has, [squ] has not filed all required compliance 
reports.
    (2) Affirmative Action Compliance. The offeror represents that--
    (i) It [squ] has developed and has on file, [chyph][squ] has not 
developed and does not have on file, at each establishment, affirmative 
action programs required by rules and regulations of the Secretary of 
Labor (41 CFR parts 60-1 and 60-2), or
    (ii) It [squ] has not previously had contracts subject to the 
written affirmative action programs requirement of the rules and 
regulations of the Secretary of Labor.
    (e) Certification Regarding Payments to Influence Federal 
Transactions (31 U.S.C. 1352). (Applies only if the contract is expected 
to exceed $100,000.) By submission of its offer, the offeror certifies 
to the best of its knowledge and belief that no Federal appropriated 
funds have been paid or will be paid to any person for influencing or 
attempting to influence an officer or employee of any agency, a Member 
of Congress, an officer or employee of Congress or an employee of a 
Member of Congress on his or her behalf in connection with the award of 
any resultant contract.
    (f) Buy American Act Certificate. (Applies only if the clause at 
Federal Acquisition Regulation (FAR) 52.225-1, Buy American Act--
Supplies, is included in this solicitation.)
    (1) The offeror certifies that each end product, except those listed 
in paragraph (f)(2) of this provision, is a domestic end product and 
that the offeror has considered components of unknown origin to have 
been mined, produced, or manufactured outside the United States. The 
offeror shall list as foreign end products those end products 
manufactured in the United States that do not qualify as domestic end 
products. The terms ``component,'' ``domestic end product,'' ``end 
product,'' ``foreign end product,'' and ``United States'' are defined in 
the clause of this solicitation entitled ``Buy American Act--Supplies.''
    (2) Foreign End Products:
Line Item No.:__________________________________________________________
Country of Origin:______________________________________________________
    (List as necessary)
    (3) The Government will evaluate offers in accordance with the 
policies and procedures of FAR Part 25.
    (g)(1) Buy American Act--North American Free Trade Agreement--
Israeli Trade Act Certificate. (Applies only if the clause at FAR 
52.225-3, Buy American Act--North American Free Trade Agreement--Israeli 
Trade Act, is included in this solicitation.)
    (i) The offeror certifies that each end product, except those listed 
in paragraph (g)(1)(ii) or (g)(1)(iii) of this provision, is a domestic 
end product and that the offeror has considered components of unknown 
origin to have been mined, produced, or manufactured outside the United 
States. The terms ``component,'' ``domestic end product,'' ``end 
product,'' ``foreign end product,'' and ``United States'' are defined in 
the clause of this solicitation entitled ``Buy American Act--North 
American Free Trade Agreement--Israeli Trade Act.''
    (ii) The offeror certifies that the following supplies are NAFTA 
country end products or Israeli end products as defined in the clause of 
this solicitation entitled ``Buy American Act--North American Free Trade 
Agreement--Israeli Trade Act '':

                  NAFTA Country or Israeli End Products

Line Item No.:__________________________________________________________
Country of Origin:______________________________________________________
    (List as necessary)
    (iii) The offeror shall list those supplies that are foreign end 
products (other than

[[Page 50]]

those listed in paragraph (g)(1)(ii) of this provision) as defined in 
the clause of this solicitation entitled ``Buy American Act--North 
American Free Trade Agreement--Israeli Trade Act.'' The offeror shall 
list as other foreign end products those end products manufactured in 
the United States that do not qualify as domestic end products.

                       Other Foreign End Products

Line Item No.:__________________________________________________________
Country of Origin:______________________________________________________
    (List as necessary)
    (iv) The Government will evaluate offers in accordance with the 
policies and procedures of FAR Part 25.
    (2) Buy American Act--North American Free Trade Agreements--Israeli 
Trade Act Certificate, Alternate I (May 2002). If Alternate I to the 
clause at FAR 52.225-3 is included in this solicitation, substitute the 
following paragraph (g)(1)(ii) for paragraph (g)(1)(ii) of the basic 
provision:
    (g)(1)(ii) The offeror certifies that the following supplies are 
Canadian end products as defined in the clause of this solicitation 
entitled ``Buy American Act--North American Free Trade Agreement--
Israeli Trade Act'':

                         Canadian End Products:

                              Line Item No.

________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
    (List as necessary)
    (3) Buy American Act--North American Free Trade Agreements--Israeli 
Trade Act Certificate, Alternate II (May 2002). If Alternate II to the 
clause at FAR 52.225-3 is included in this solicitation, substitute the 
following paragraph (g)(1)(ii) for paragraph (g)(1)(ii) of the basic 
provision:
    (g)(1)(ii) The offeror certifies that the following supplies are 
Canadian end products or Israeli end products as defined in the clause 
of this solicitation entitled ``Buy American Act--North American Free 
Trade Agreement--Israeli Trade Act'':

                    Canadian or Israeli End Products:

Line Item No.
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
Country of Origin
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
    (List as necessary)
    (4) Trade Agreements Certificate. (Applies only if the clause at FAR 
52.225-5, Trade Agreements, is included in this solicitation.)
    (i) The offeror certifies that each end product, except those listed 
in paragraph (g)(4)(ii) of this provision, is a U.S.-made, designated 
country, Caribbean Basin country, or NAFTA country end product, as 
defined in the clause of this solicitation entitled ``Trade 
Agreements.''
    (ii) The offeror shall list as other end products those end products 
that are not U.S.-made, designated country, Caribbean Basin country, or 
NAFTA country end products.

                           Other End Products

Line Item No.:__________________________________________________________
Country of Origin:______________________________________________________
    (List as necessary)
    (iii) The Government will evaluate offers in accordance with the 
policies and procedures of FAR Part 25. For line items subject to the 
Trade Agreements Act, the Government will evaluate offers of U.S.-made, 
designated country, Caribbean Basin country, or NAFTA country end 
products without regard to the restrictions of the Buy American Act. The 
Government will consider for award only offers of U.S.-made, designated 
country, Caribbean Basin country, or NAFTA country end products unless 
the Contracting Officer determines that there are no offers for such 
products or that the offers for such products are insufficient to 
fulfill the requirements of the solicitation.
    (g)(1) Buy American Act--North American Free Trade Agreement 
Implementation Act--Balance of Payments Program. (Applies only if FAR 
clause 52.22521, Buy American Act--North American Free Trade Agreement 
Implementation Act--Balance of Payments Program, is included in this 
solicitation.)
    (i) The offeror certifies that each end product being offered, 
except those listed in paragraph (g)(1)(ii) of this provision, is a 
domestic end product (as defined in the clause entitled ``Buy American 
Act--North American Free Trade Agreement Implementation Act--Balance of 
Payments Program,'' and that components of unknown origin have been 
considered to have been

[[Page 51]]

mined, produced, or manufactured outside the United States.
    (ii) Excluded End Products:

 
           Line item No.                      Country of origin
 
   --------------------               ----------------------
   --------------------               ----------------------
 

                           [List as necessary]

    (iii) Offers will be evaluated by giving certain preferences to 
domestic end products or NAFTA country end products over other end 
products. In order to obtain these preferences in the evaluation of each 
excluded end product listed in paragraph (g)(1)(ii) of this provision, 
offerors must identify and certify below those excluded end products 
that are NAFTA country end products. Products that are not identified 
and certified below will not be deemed NAFTA country end products. The 
offeror certifies that the following supplies qualify as NAFTA country 
end products as that term is defined in the clause entitled ``Buy 
American Act--North American Free Trade Agreement Implementation Act--
Balance of Payments Program'':

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

[Insert line item numbers)
    (iv) Offers will be evaluated in accordance with part 25 of the 
Federal Acquisition Regulation. In addition, if this solicitation is for 
supplies for use outside the United States, an evaluation factor of 50 
percent will be applied to offers of end products that are not domestic 
or NAFTA country end products.
    (2) Alternate I. If Alternate I to the clause at 52.225-21 is 
included in this solicitation, substitute the following paragraph 
(g)(1)(iii) for paragraph (g)(1)(iii) of this provision:
    (g)(1)(iii) Offers will be evaluated by giving certain preferences 
to domestic end products or Canadian end products over other end 
products. In order to obtain these preferences in the evaluation of each 
excluded end product listed in paragraph (b) of this provision, offerors 
must identify and certify below those excluded end products that are 
Canadian end products. Products that are not identified and certified 
below will not be deemed Canadian end products.
    The offeror certifies that the following supplies qualify as 
Canadian end products as that term is defined in the clause entitled 
``Buy American Act--North American Free Trade Agreement Implementation 
Act--Balance of Payments Program'':

________________________________________________________________________

[Insert line item numbers]
    (h) Certification Regarding Debarment, Suspension or Ineligibility 
for Award (Executive Order 12549). (Applies only if the contract value 
is expected to exceed the simplified acquisition threshold.) The offeror 
certifies, to the best of its knowledge and belief, that the offeror 
and/or any of its principals--
    (1) [ ] Are, [ ] are not presently debarred, suspended, proposed for 
debarment, or declared ineligible for the award of contracts by any 
Federal agency; and
    (2) [ ] Have, [ ] have not, within a three-year period preceding 
this offer, been convicted of or had a civil judgment rendered against 
them for: Commission of fraud or a criminal offense in connection with 
obtaining, attempting to obtain, or performing a Federal, state or local 
government contract or subcontract; violation of Federal or state 
antitrust statutes relating to the submission of offers; or Commission 
of embezzlement, theft, forgery, bribery, falsification or destruction 
of records, making false statements, tax evasion, or receiving stolen 
property; and
    (3) [ ] Are, [ ] are not presently indicted for, or otherwise 
criminally or civilly charged by a Government entity with, commission of 
any of these offenses.
    (i) Certification Regarding Knowledge of Child Labor for Listed End 
Products (Executive Order 13126). [The Contracting Officer must list in 
paragraph (i)(1) any end products being acquired under this solicitation 
that are included in the List of Products Requiring Contractor 
Certification as to Forced or Indentured Child Labor, unless excluded at 
22.1503(b).]
    (1) Listed end products.

                           Listed End Product

________________________________________________________________________
________________________________________________________________________

[[Page 52]]

                       Listed Countries of Origin

________________________________________________________________________
________________________________________________________________________
    (2) Certification. [If the Contracting Officer has identified end 
products and countries of origin in paragraph (i)(1) of this provision, 
then the offeror must certify to either (i)(2)(i) or (i)(2)(ii) by 
checking the appropriate block.]
    [squ] (i) The offeror will not supply any end product listed in 
paragraph (i)(1) of this provision that was mined, produced, or 
manufactured in the corresponding country as listed for that product.
    [squ] (ii) The offeror may supply an end product listed in paragraph 
(i)(1) of this provision that was mined, produced, or manufactured in 
the corresponding country as listed for that product. The offeror 
certifies that it has made a good faith effort to determine whether 
forced or indentured child labor was used to mine, produce, or 
manufacture any such end product furnished under this contract. On the 
basis of those efforts, the offeror certifies that it is not aware of 
any such use of child labor.

                           (End of provision)

    Alternate I (APR 2002). As prescribed in 12.301(b)(2), add the 
following paragraph (c)(11) to the basic provision:

    (11) (Complete if the offeror has represented itself as 
disadvantaged in paragraph (c)(4) or (c)(9) of this provision.) [The 
offeror shall check the category in which its ownership falls]:

    --Black American.
    --Hispanic American.
    --Native American (American Indians, Eskimos, Aleuts, or Native 
Hawaiians).
    --Asian-Pacific American (persons with origins from Burma, Thailand, 
Malaysia, Indonesia, Singapore, Brunei, Japan, China, Taiwan, Laos, 
Cambodia (Kampuchea), Vietnam, Korea, The Philippines, U.S. Trust 
Territory of the Pacific Islands (Republic of Palau), Republic of the 
Marshall Islands, Federated States of Micronesia, the Commonwealth of 
the Northern Mariana Islands, Guam, Samoa, Macao, Hong Kong, Fiji, 
Tonga, Kiribati, Tuvalu, or Nauru).
    --Subcontinent Asian (Asian-Indian) American (persons with origins 
from India, Pakistan, Bangladesh, Sri Lanka, Bhutan, the Maldives 
Islands, or Nepal).
    --Individual/concern, other than one of the preceding.

    Alternate II (Oct 2000). As prescribed in 12.301(b)(2), add the 
following paragraph (c)(9)(iii) to the basic provision:

    (iii) Address. The offeror represents that its address --is, --is 
not in a region for which a small disadvantaged business procurement 
mechanism is authorized and its address has not changed since its 
certification as a small disadvantaged business concern or submission of 
its application for certification. The list of authorized small 
disadvantaged business procurement mechanisms and regions is posted at 
http://www.arnet.gov/References/sdbadjustments.htm. The offeror shall 
use the list in effect on the date of this solicitation. ``Address,'' as 
used in this provision, means the address of the offeror as listed on 
the Small Business Administration's register of small disadvantaged 
business concerns or the address on the completed application that the 
concern has submitted to the Small Business Administration or a Private 
Certifier in accordance with 13 CFR part 124, subpart B. For joint 
ventures, ``address'' refers to the address of the small disadvantaged 
business concern that is participating in the joint venture.

[60 FR 48252, Sept. 18, 1995, as amended at 60 FR 54818, Oct. 26, 1995; 
61 FR 2633, Jan. 26, 1996; 61 FR 31648, June 20, 1996; 62 FR 233, Jan. 
2, 1997; 62 FR 238, 261, Jan. 2, 1997; 63 FR 35724, June 30, 1998; 63 FR 
36124, July 1, 1998; 63 FR 52427, Sept. 30, 1998; 63 FR 58590, Oct. 30, 
1998; 63 FR 70274, 70285, Dec. 18, 1998; 64 FR 10533, Mar. 4, 1999; 64 
FR 32749, June 17, 1999; 64 FR 36224, July 2, 1999; 64 FR 72432, Dec. 
27, 1999; 65 FR 46058, July 26, 2000; 65 FR 60546; Oct. 11, 2000; 65 FR 
80266, Dec. 20, 2000; 66 FR 2134, Jan. 10, 2001; 66 FR 5348, Jan. 18, 
2001; 66 FR 18735, Apr. 11, 2001; 66 FR 66986, 66990, Dec. 27, 2001; 67 
FR 6121, Feb. 8, 2002; 67 FR 13066, Mar. 20, 2002; 67 FR 21536, Apr. 30, 
2002; 67 FR 43520, June 27, 2002; 68 FR 28084, May 22, 2003]



Sec.  52.212-4  Contract Terms and Conditions--Commercial Items.

    As prescribed in 12.301(b)(3), insert the following clause:

       Contract Terms and Conditions--Commercial Items (OCT 2003)

    (a) Inspection/Acceptance. The Contractor shall only tender for 
acceptance those items that conform to the requirements of this 
contract. The Government reserves the right to inspect or test any 
supplies or services that have been tendered for acceptance. The 
Government may require repair or replacement of nonconforming supplies 
or reperformance of nonconforming services at no increase in contract 
price. The Government must exercise its postacceptance rights (1) within 
a reasonable time after the defect was discovered or should have been 
discovered; and (2) before any substantial change occurs in the 
condition of the item, unless the change is due to the defect in the 
item.
    (b) Assignment. The Contractor or its assignee may assign its rights 
to receive payment due as a result of performance of this contract to a 
bank, trust company, or other financing institution, including any 
Federal

[[Page 53]]

lending agency in accordance with the Assignment of Claims Act (31 
U.S.C. 3727). However, when a third party makes payment (e.g., use of 
the Governmentwide commercial purchase card), the Contractor may not 
assign its rights to receive payment under this contract.
    (c) Changes. Changes in the terms and conditions of this contract 
may be made only by written agreement of the parties.
    (d) Disputes. This contract is subject to the Contract Disputes Act 
of 1978, as amended (41 U.S.C. 601-613). Failure of the parties to this 
contract to reach agreement on any request for equitable adjustment, 
claim, appeal or action arising under or relating to this contract shall 
be a dispute to be resolved in accordance with the clause at FAR 52.233-
1, Disputes, which is incorporated herein by reference. The Contractor 
shall proceed diligently with performance of this contract, pending 
final resolution of any dispute arising under the contract.
    (e) Definitions. The clause at FAR 52.202-1, Definitions, is 
incorporated herein by reference.
    (f) Excusable delays. The Contractor shall be liable for default 
unless nonperformance is caused by an occurrence beyond the reasonable 
control of the Contractor and without its fault or negligence such as, 
acts of God or the public enemy, acts of the Government in either its 
sovereign or contractual capacity, fires, floods, epidemics, quarantine 
restrictions, strikes, unusually severe weather, and delays of common 
carriers. The Contractor shall notify the Contracting Officer in writing 
as soon as it is reasonably possible after the commencement of any 
excusable delay, setting forth the full particulars in connection 
therewith, shall remedy such occurrence with all reasonable dispatch, 
and shall promptly give written notice to the Contracting Officer of the 
cessation of such occurrence.
    (g) Invoice. (1) The Contractor shall submit an original invoice and 
three copies (or electronic invoice, if authorized) to the address 
designated in the contract to receive invoices. An invoice must 
include--
    (i) Name and address of the Contractor;
    (ii) Invoice date and number;
    (iii) Contract number, contract line item number and, if applicable, 
the order number;
    (iv) Description, quantity, unit of measure, unit price and extended 
price of the items delivered;
    (v) Shipping number and date of shipment, including the bill of 
lading number and weight of shipment if shipped on Government bill of 
lading;
    (vi) Terms of any discount for prompt payment offered;
    (vii) Name and address of official to whom payment is to be sent;
    (viii) Name, title, and phone number of person to notify in event of 
defective invoice; and
    (ix) Taxpayer Identification Number (TIN). The Contractor shall 
include its TIN on the invoice only if required elsewhere in this 
contract.
    (x) Electronic funds transfer (EFT) banking information.
    (A) The Contractor shall include EFT banking information on the 
invoice only if required elsewhere in this contract.
    (B) If EFT banking information is not required to be on the invoice, 
in order for the invoice to be a proper invoice, the Contractor shall 
have submitted correct EFT banking information in accordance with the 
applicable solicitation provision, contract clause (e.g., 52.232-33, 
Payment by Electronic Funds Transfer--Central Contractor Registration, 
or 52.232-34, Payment by Electronic Funds Transfer--Other Than Central 
Contractor Registration), or applicable agency procedures.
    (C) EFT banking information is not required if the Government waived 
the requirement to pay by EFT.
    (2) Invoices will be handled in accordance with the Prompt Payment 
Act (31 U.S.C. 3903) and Office of Management and Budget (OMB) prompt 
payment regulations at 5 CFR part 1315.
    (h) Patent indemnity. The Contractor shall indemnify the Government 
and its officers, employees and agents against liability, including 
costs, for actual or alleged direct or contributory infringement of, or 
inducement to infringe, any United States or foreign patent, trademark 
or copyright, arising out of the performance of this contract, provided 
the Contractor is reasonably notified of such claims and proceedings.
    (i) Payment. Payment shall be made for items accepted by the 
Government that have been delivered to the delivery destinations set 
forth in this contract. The Government will make payment in accordance 
with the Prompt Payment Act (31 U.S.C. 3903) and OMB prompt payment 
regulations at 5 CFR part 1315. If the Government makes payment by 
Electronic Funds Transfer (EFT), see 52.212-5(b) for the appropriate EFT 
clause.
    In connection with any discount offered for early payment, time 
shall be computed from the date of the invoice. For the purpose of 
computing the discount earned, payment shall be considered to have been 
made on the date which appears on the payment check or the specified 
payment date if an electronic funds transfer payment is made.
    (j) Risk of loss. Unless the contract specifically provides 
otherwise, risk of loss or damage to the supplies provided under this 
contract shall remain with the Contractor until, and shall pass to the 
Government upon:
    (1) Delivery of the supplies to a carrier, if transportation is 
f.o.b. origin; or

[[Page 54]]

    (2) Delivery of the supplies to the Government at the destination 
specified in the contract, if transportation is f.o.b. destination.
    (k) Taxes. The contract price includes all applicable Federal, 
State, and local taxes and duties.
    (l) Termination for the Government's convenience. The Government 
reserves the right to terminate this contract, or any part hereof, for 
its sole convenience. In the event of such termination, the Contractor 
shall immediately stop all work hereunder and shall immediately cause 
any and all of its suppliers and subcontractors to cease work. Subject 
to the terms of this contract, the Contractor shall be paid a percentage 
of the contract price reflecting the percentage of the work performed 
prior to the notice of termination, plus reasonable charges the 
Contractor can demonstrate to the satisfaction of the Government using 
its standard record keeping system, have resulted from the termination. 
The Contractor shall not be required to comply with the cost accounting 
standards or contract cost principles for this purpose. This paragraph 
does not give the Government any right to audit the Contractor's 
records. The Contractor shall not be paid for any work performed or 
costs incurred which reasonably could have been avoided.
    (m) Termination for cause. The Government may terminate this 
contract, or any part hereof, for cause in the event of any default by 
the Contractor, or if the Contractor fails to comply with any contract 
terms and conditions, or fails to provide the Government, upon request, 
with adequate assurances of future performance. In the event of 
termination for cause, the Government shall not be liable to the 
Contractor for any amount for supplies or services not accepted, and the 
Contractor shall be liable to the Government for any and all rights and 
remedies provided by law. If it is determined that the Government 
improperly terminated this contract for default, such termination shall 
be deemed a termination for convenience.
    (n) Title. Unless specified elsewhere in this contract, title to 
items furnished under this contract shall pass to the Government upon 
acceptance, regardless of when or where the Government takes physical 
possession.
    (o) Warranty. The Contractor warrants and implies that the items 
delivered hereunder are merchantable and fit for use for the particular 
purpose described in this contract.
    (p) Limitation of liability. Except as otherwise provided by an 
express warranty, the Contractor will not be liable to the Government 
for consequential damages resulting from any defect or deficiencies in 
accepted items.
    (q) Other compliances. The Contractor shall comply with all 
applicable Federal, State and local laws, executive orders, rules and 
regulations applicable to its performance under this contract.
    (r) Compliance with laws unique to Government contracts. The 
Contractor agrees to comply with 31 U.S.C. 1352 relating to limitations 
on the use of appropriated funds to influence certain Federal contracts; 
18 U.S.C. 431 relating to officials not to benefit; 40 U.S.C. 327, et 
seq., Contract Work Hours and Safety Standards Act; 41 U.S.C. 51-58, 
Anti-Kickback Act of 1986; 41 U.S.C. 265 and 10 U.S.C. 2409 relating to 
whistleblower protections; 49 U.S.C. 40118, Fly American; and 41 U.S.C. 
423 relating to procurement integrity.
    (s) Order of precedence. Any inconsistencies in this solicitation or 
contract shall be resolved by giving precedence in the following order: 
(1) the schedule of supplies/services; (2) the Assignments, Disputes, 
Payments, Invoice, Other Compliances, and Compliance with Laws Unique to 
Government Contracts paragraphs of this clause; (3) the clause at 
52.212-5; (4) addenda to this solicitation or contract, including any 
license agreements for computer software; (5) solicitation provisions if 
this is a solicitation; (6) other paragraphs of this clause; (7) the 
Standard Form 1449; (8) other documents, exhibits, and attachments; and 
(9) the specification.
    (t) Central Contractor Registration (CCR). (1) Unless exempted by an 
addendum to this contract, the Contractor is responsible during 
performance and through final payment of any contract for the accuracy 
and completeness of the data within the CCR database, and for any 
liability resulting from the Government's reliance on inaccurate or 
incomplete data. To remain registered in the CCR database after the 
initial registration, the Contractor is required to review and update on 
an annual basis from the date of initial registration or subsequent 
updates its information in the CCR database to ensure it is current, 
accurate and complete. Updating information in the CCR does not alter 
the terms and conditions of this contract and is not a substitute for a 
properly executed contractual document.
    (2)(i) If a Contractor has legally changed its business name, 
``doing business as'' name, or division name (whichever is shown on the 
contract), or has transferred the assets used in performing the 
contract, but has not completed the necessary requirements regarding 
novation and change-of-name agreements in FAR subpart 42.12, the 
Contractor shall provide the responsible Contracting Officer a minimum 
of one business day's written notification of its intention to (A) 
change the name in the CCR database; (B) comply with the requirements of 
subpart 42.12; and (C) agree in writing to the timeline and procedures 
specified by the responsible Contracting Officer. The Contractor must 
provide with the notification sufficient documentation to support the 
legally changed name.
    (ii) If the Contractor fails to comply with the requirements of 
paragraph (t)(2)(i) of this

[[Page 55]]

clause, or fails to perform the agreement at paragraph (t)(2)(i)(C) of 
this clause, and, in the absence of a properly executed novation or 
change-of-name agreement, the CCR information that shows the Contractor 
to be other than the Contractor indicated in the contract will be 
considered to be incorrect information within the meaning of the 
``Suspension of Payment'' paragraph of the electronic funds transfer 
(EFT) clause of this contract.
    (3) The Contractor shall not change the name or address for EFT 
payments or manual payments, as appropriate, in the CCR record to 
reflect an assignee for the purpose of assignment of claims (see Subpart 
32.8, Assignment of Claims). Assignees shall be separately registered in 
the CCR database. Information provided to the Contractor's CCR record 
that indicates payments, including those made by EFT, to an ultimate 
recipient other than that Contractor will be considered to be incorrect 
information within the meaning of the ``Suspension of payment'' 
paragraph of the EFT clause of this contract.
    (4) Offerors and Contractors may obtain information on registration 
and annual confirmation requirements via the internet at http://
www.ccr.gov or by calling 1-888-227-2423 or 269-961-5757.

                             (End of clause)

[60 FR 48254, Sept. 18, 1995, as amended at 61 FR 45773, Aug. 29, 1996; 
62 FR 12711, Mar. 14, 1997; 63 FR 9052, Feb. 23, 1998; 64 FR 10542, Mar. 
4, 1999; 66 FR 2139, Jan. 10, 2001; 66 FR 53485, Oct. 22, 2001; 66 FR 
65350, Dec. 18, 2001; 68 FR 56675, Oct. 1, 2003]

    Effective Date Note: At 68 FR 56683, Oct. 1, 2003, 52.212-4 was 
amended by revising the date of the clause and paragraph (i) and 
removing the undesignated paragraph following paragraph (i), effective 
Oct. 31, 2003. For the convenience of the user, the revised text is set 
forth below:

Sec.  52.212-4  Contract Terms and Conditions--Commercial Items.

                                * * * * *

       Contract Terms and Conditions--Commercial Items (Oct. 2003)

                                * * * * *

    (i) Payment.--(1) Items accepted. Payment shall be made for items 
accepted by the Government that have been delivered to the delivery 
destinations set forth in this contract.
    (2) Prompt payment. The Government will make payment in accordance 
with the Prompt Payment Act (31 U.S.C. 3903) and prompt payment 
regulations at 5 CFR part 1315.
    (3) Electronic Funds Transfer (EFT). If the Government makes payment 
by EFT, see 52.212-5(b) for the appropriate EFT clause.
    (4) Discount. In connection with any discount offered for early 
payment, time shall be computed from the date of the invoice. For the 
purpose of computing the discount earned, payment shall be considered to 
have been made on the date which appears on the payment check or the 
specified payment date if an electronic funds transfer payment is made.
    (5) Overpayments. If the Contractor becomes aware of a duplicate 
contract financing or invoice payment or that the Government has 
otherwise overpaid on a contract financing or invoice payment, the 
Contractor shall immediately notify the Contracting Officer and request 
instructions for disposition of the overpayment.

                                * * * * *



Sec.  52.212-5  Contract Terms and Conditions Required to Implement 
Statutes or Executive Orders--Commercial Items.

    As prescribed in 12.301(b)(4), insert the following clause:

    Contract Terms and Conditions Required to Implement Statutes or 
              Executive Orders--Commercial Items (OCT 2003)

    (a) The Contractor shall comply with the following Federal 
Acquisition Regulation (FAR) clause, which is incorporated in this 
contract by reference, to implement provisions of law or Executive 
orders applicable to acquisitions of commercial items: 52.233-3, Protest 
after Award (AUG 1996) (31 U.S.C. 3553).
    (b) The Contractor shall comply with the FAR clauses in this 
paragraph (b) that the Contracting Officer has indicated as being 
incorporated in this contract by reference to implement provisions of 
law or Executive orders applicable to acquisitions of commercial items: 
[Contracting Officer check as appropriate.]
    --(1) 52.203-6, Restrictions on Subcontractor Sales to the 
Government (JUL 1995), with Alternate I (OCT 1995) (41 U.S.C. 253g and 
10 U.S.C. 2402).
    --(2) 52.219-3, Notice of Total HUBZone Set-Aside (JAN 1999) (15 
U.S.C. 657a).
    --(3) 52.219-4, Notice of Price Evaluation Preference for HUBZone 
Small Business Concerns (JAN 1999) (if the offeror elects to waive the 
preference, it shall so indicate in its offer) (15 U.S.C. 657a).
    --(4)(i) 52.219-5, Very Small Business Set-Aside (JUNE 2003) (Pub. 
L. 103-403, section 304, Small Business Reauthorization and Amendments 
Act of 1994).
    --(ii) Alternate I (MAR 1999) of 52.219-5.

[[Page 56]]

    --(iii) Alternate II (JUNE 2003) of 52.219-5.
    --(5)(i) 52.219-6, Notice of Total Small Business Set-Aside (JUNE 
2003) (15 U.S.C. 644).
    --(ii) Alternate I (OCT 1995) of 52.219-6.
    --(6)(i) 52.219-7, Notice of Partial Small Business Set-Aside (JUNE 
2003) (15 U.S.C. 644).
    --(ii) Alternate I (OCT 1995) of 52.219-7.
    --(7) 52.219-8, Utilization of Small Business Concerns (OCT 2000) 
(15 U.S.C. 637 (d)(2) and (3)).
    --(8)(i) 52.219-9, Small Business Subcontracting Plan (JAN 2002) (15 
U.S.C. 637(d)(4)).
    --(ii) Alternate I (OCT 2001) of 52.219-9.
    --(iii) Alternate II (OCT 2001) of 52.219-9.
    --(9) 52.219-14, Limitations on Subcontracting (DEC 1996) (15 U.S.C. 
637(a)(14)).
    --(10)(i) 52.219-23, Notice of Price Evaluation Adjustment for Small 
Disadvantaged Business Concerns (JUNE 2003) (Pub. L. 103-355, section 
7102, and 10 U.S.C. 2323) (if the offeror elects to waive the 
adjustment, it shall so indicate in its offer).
    --(ii) Alternate I (JUNE 2003) of 52.219-23.
    --(11) 52.219-25, Small Disadvantaged Business Participation 
Program--Disadvantaged Status and Reporting (OCT 1999) (Pub. L. 103-355, 
section 7102, and 10 U.S.C. 2323).
    --(12) 52.219-26, Small Disadvantaged Business Participation 
Program--Incentive Subcontracting (OCT 2000) (Pub. L. 103-355, section 
7102, and 10 U.S.C. 2323).
    --(13) 52.222-3, Convict Labor (JUNE 2003) (E.O. 11755).
    --(14) 52.222-19, Child Labor--Cooperation with Authorities and 
Remedies (SEP 2002) (E.O. 13126).
    --(15) 52.222-21, Prohibition of Segregated Facilities (FEB 1999).
    --(16) 52.222-26, Equal Opportunity (APR 2002) (E.O. 11246).
    --(17) 52.222-35, Equal Opportunity for Special Disabled Veterans, 
Veterans of the Vietnam Era, and Other Eligible Veterans (DEC 2001) (38 
U.S.C. 4212).
    --(18) 52.222-36, Affirmative Action for Workers with Disabilities 
(JUN 1998) (29 U.S.C. 793).
    --(19) 52.222-37, Employment Reports on Special Disabled Veterans, 
Veterans of the Vietnam Era, and Other Eligible Veterans (DEC 2001) (38 
U.S.C. 4212).
    --(20)(i) 52.223-9, Estimate of Percentage of Recovered Material 
Content for EPA-Designated Products (AUG 2000) (42 U.S.C. 
6962(c)(3)(A)(ii)).
    --(ii) Alternate I (AUG 2000) of 52.223-9 (42 U.S.C. 6962(i)(2)(C)).
    --(21) 52.225-1, Buy American Act--Supplies (JUNE 2003) (41 U.S.C. 
10a-10d).
    --(22)(i) 52.225-3, Buy American Act--North American Free Trade 
Agreement--Israeli Trade Act (JUNE 2003) (41 U.S.C. 10a-10d, 19 U.S.C. 
3301 note, 19 U.S.C. 2112 note).
    --(ii) Alternate I (MAY 2002) of 52.225-3.
    --(iii) Alternate II (MAY 2002) of 52.225-3.
    --(23) 52.225-5, Trade Agreements (JUNE 2003) (19 U.S.C. 2501, et 
seq., 19 U.S.C. 3301 note).
    --(24) 52.225-13, Restrictions on Certain Foreign Purchases (JUNE 
2003) (E.O. 12722, 12724, 13059, 13067, 13121, and 13129).
    --(25) 52.225-15, Sanctioned European Union Country End Products 
(FEB 2000) (E.O. 12849).
    --(26) 52.225-16, Sanctioned European Union Country Services (FEB 
2000) (E.O. 12849).
    --(27) 52.232-29, Terms for Financing of Purchases of Commercial 
Items (FEB 2002) (41 U.S.C. 255(f), 10 U.S.C. 2307(f)).
    --(28) 52.232-30, Installment Payments for Commercial Items (OCT 
1995) (41 U.S.C. 255(f), 10 U.S.C. 2307(f)).
    --(29) 52.232-33, Payment by Electronic Funds Transfer--Central 
Contractor Registration (OCT 2003) (31 U.S.C. 3332).
    --(30) 52.232-34, Payment by Electronic Funds Transfer--Other than 
Central Contractor Registration (MAY 1999) (31 U.S.C. 3332).
    --(31) 52.232-36, Payment by Third Party (MAY 1999) (31 U.S.C. 
3332).
    --(32) 52.239-1, Privacy or Security Safeguards (AUG 1996) (5 U.S.C. 
552a).
    --(33)(i) 52.247-64, Preference for Privately Owned U.S.-Flag 
Commercial Vessels (APR 2003) (46 U.S.C. Appx 1241 and 10 U.S.C. 2631).
    --(ii) Alternate I (APR 1984) of 52.247-64.
    (c) The Contractor shall comply with the FAR clauses in this 
paragraph (c), applicable to commercial services, that the Contracting 
Officer has indicated as being incorporated in this contract by 
reference to implement provisions of law or Executive orders applicable 
to acquisitions of commercial items: [Contracting Officer check as 
appropriate.]
    --(1) 52.222-41, Service Contract Act of 1965, as Amended (MAY 1989) 
(41 U.S.C. 351, et seq.).
    --(2) 52.222-42, Statement of Equivalent Rates for Federal Hires 
(MAY 1989) (29 U.S.C. 206 and 41 U.S.C. 351, et seq.).
    --(3) 52.222-43, Fair Labor Standards Act and Service Contract Act--
Price Adjustment (Multiple Year and Option Contracts) (MAY 1989) (29 
U.S.C. 206 and 41 U.S.C. 351, et seq.).
    --(4) 52.222-44, Fair Labor Standards Act and Service Contract Act--
Price Adjustment (February 2002) (29 U.S.C. 206 and 41 U.S.C. 351, et 
seq.).
    --(5) 52.222-47, SCA Minimum Wages and Fringe Benefits Applicable to 
Successor Contract Pursuant to PreDecemberessor Contractor Collective 
Bargaining Agreements (CBA) (May 1989) (41 U.S.C. 351, et seq.).
    (d) Comptroller General Examination of Record. The Contractor shall 
comply with the provisions of this paragraph (d) if this contract was 
awarded using other than sealed bid, is in excess of the simplified 
acquisition threshold, and does not contain the clause at 52.215-2, 
Audit and Records--Negotiation.

[[Page 57]]

    (1) The Comptroller General of the United States, or an authorized 
representative of the Comptroller General, shall have access to and 
right to examine any of the Contractor's directly pertinent records 
involving transactions related to this contract.
    (2) The Contractor shall make available at its offices at all 
reasonable times the records, materials, and other evidence for 
examination, audit, or reproduction, until 3 years after final payment 
under this contract or for any shorter period specified in FAR Subpart 
4.7, Contractor Records Retention, of the other clauses of this 
contract. If this contract is completely or partially terminated, the 
records relating to the work terminated shall be made available for 3 
years after any resulting final termination settlement. Records relating 
to appeals under the disputes clause or to litigation or the settlement 
of claims arising under or relating to this contract shall be made 
available until such appeals, litigation, or claims are finally 
resolved.
    (3) As used in this clause, records include books, documents, 
accounting procedures and practices, and other data, regardless of type 
and regardless of form. This does not require the Contractor to create 
or maintain any record that the Contractor does not maintain in the 
ordinary course of business or pursuant to a provision of law.
    (e)(1) Notwithstanding the requirements of the clauses in paragraphs 
(a), (b), (c), and (d) of this clause, the Contractor is not required to 
flow down any FAR clause, other than those in paragraphs (i) through 
(vi) of this paragraph in a subcontract for commercial items. Unless 
otherwise indicated below, the extent of the flow down shall be as 
required by the clause--
    (i) 52.219-8, Utilization of Small Business Concerns (October 2000) 
(15 U.S.C. 637(d)(2) and (3)), in all subcontracts that offer further 
subcontracting opportunities. If the subcontract (except subcontracts to 
small business concerns) exceeds $500,000 ($1,000,000 for construction 
of any public facility), the subcontractor must include 52.219-8 in 
lower tier subcontracts that offer subcontracting opportunities.
    (ii) 52.222-26, Equal Opportunity (April 2002) (E.O. 11246).
    (iii) 52.222-35, Equal Opportunity for Special Disabled Veterans, 
Veterans of the Vietnam Era, and Other Eligible Veterans (December 2001) 
(38 U.S.C. 4212).
    (iv) 52.222-36, Affirmative Action for Workers with Disabilities 
(June 1998) (29 U.S.C. 793).
    (v) 52.222-41, Service Contract Act of 1965, as Amended (May 1989), 
flow down required for all subcontracts subject to the Service Contract 
Act of 1965 (41 U.S.C. 351, et seq.).
    (vi) 52.247-64, Preference for Privately Owned U.S.-Flag Commercial 
Vessels (April 2003) (46 U.S.C. Appx 1241 and 10 U.S.C. 2631). Flow down 
required in accordance with paragraph (d) of FAR clause 52.247-64.
    (2) While not required, the contractor May include in its 
subcontracts for commercial items a minimal number of additional clauses 
necessary to satisfy its contractual obligations.

                             (End of clause)

    Alternate I (Feb 2000). As prescribed in 12.301(b)(4), delete 
paragraph (d) from the basic clause, redesignate paragraph (e) as 
paragraph (d), and revise the reference to ``paragraphs (a), (b), (c), 
or (d) of this clause'' in the redesignated paragraph (d) to read 
``paragraphs (a), (b), and (c) of this clause''.

[60 FR 48255, Sept. 18, 1995, as amended at 60 FR 67517, Dec. 29, 1995; 
61 FR 31648, June 20, 1996; 61 FR 41471, Aug. 8, 1996; 63 FR 9052, 9058, 
Feb. 23, 1998; 63 FR 34075, June 22, 1998; 63 FR 35724, June 30, 1998; 
63 FR 36124, July 1, 1998; 63 FR 70274, 70292, Dec. 18, 1998; 64 FR 
10537, 10542, Mar. 4, 1999; 64 FR 72433, 72451, Dec. 27, 1999; 64 FR 
72451, Dec. 27, 1999; 65 FR 24324, Apr. 25, 2000; 65 FR 36021, 36028, 
June 6, 2000; 65 FR 46069, July 26, 2000; 66 FR 5348, Jan. 18, 2001; 66 
FR 27417, May 16, 2001; 66 FR 53489, Dec. 21, 2001; 67 FR 21536, Apr. 
30, 2002; 68 FR 13203, Mar. 18, 2003; 68 FR 28097, May 22, 2003; 68 FR 
56675, Oct. 1, 2003]

    Effective Date Notes: 1. At 68 FR 56685, Oct. 1, 2003, Sec.  52.212-
5 was amended by revising the dates in the clause heading and in 
paragraph (b)(23) to read ``(Oct 2003)'', effective Oct. 31, 2003.
    2. At 68 FR 56686, Oct. 1, 2003, Sec.  52.212-5 was amended by 
revising the date of the clause and paragraph (b)(24), effective Oct. 
31, 2003. For the convenience of the user, the revised text is set forth 
below:

Sec.  52.212-5  Contract Terms and Conditions Required to Implement 
          Statutes or Executive Orders--Commercial Items.

                                * * * * *

    Contract Terms and Conditions Required to Implement Statutes or 
             Executive Orders--Commercial Items (Oct. 2003)

                                * * * * *

    (b) * * *
    (24) 52.225-13, Restrictions on Certain Foreign Purchases (Oct. 
2003) (E.o.s, proclamations, and statutes administered by the Office of 
Foreign Assets Control of the Department of the Treasury).

                                * * * * *

[[Page 58]]



Sec.  52.213-1  Fast Payment Procedure.

    As prescribed in 13.404, insert the following clause:

                    Fast Payment Procedure (FEB 1998)

    (a) General. The Government will pay invoices based on the 
Contractor's delivery to a post office or common carrier (or, if shipped 
by other means, to the point of first receipt by the Government).
    (b) Responsibility for supplies. (1) Title to the supplies passes to 
the Government upon delivery to--
    (i) A post office or common carrier for shipment to the specific 
destination; or
    (ii) The point of first receipt by the Government, if shipment is by 
means other than Postal Service or common carrier.
    (2) Notwithstanding any other provision of the contract, order, or 
blanket purchase agreement, the Contractor shall--
    (i) Assume all responsibility and risk of loss for supplies not 
received at destination, damaged in transit, or not conforming to 
purchase requirements; and
    (ii) Replace, repair, or correct those supplies promptly at the 
Contractor's expense, if instructed to do so by the Contracting Officer 
within 180 days from the date title to the supplies vests in the 
Government.
    (c) Preparation of invoice. (1) Upon delivery to a post office or 
common carrier (or, if shipped by other means, the point of first 
receipt by the Government), the Contractor shall--
    (i) Prepare an invoice as provided in this contract, order, or 
blanket purchase agreement; and
    (ii) Display prominently on the invoice ``FAST PAY.''
    (2) If the purchase price excludes the cost of transportation, the 
Contractor shall enter the prepaid shipping cost on the invoice as a 
separate item. The Contractor shall not include the cost of parcel post 
insurance. If transportation charges are stated separately on the 
invoice, the Contractor shall retain related paid freight bills or other 
transportation billings paid separately for a period of 3 years and 
shall furnish the bills to the Government upon request.
    (3) If this contract, order, or blanket purchase agreement requires 
the preparation of a receiving report, the Contractor shall prepare the 
receiving report on the prescribed form or, alternatively, shall include 
the following information on the invoice, in addition to that required 
in paragraph (c)(1) of this clause:
    (i) A statement in prominent letters ``NO RECEIVING REPORT 
PREPARED.''
    (ii) Shipment number.
    (iii) Mode of shipment.
    (iv) At line item level--
    (A) National stock number and/or manufacturer's part number;
    (B) Unit of measure;
    (C) Ship-To Point;
    (D) Mark-For Point, if in the contract; and
    (E) FEDSTRIP/MILSTRIP document number, if in the contract.
    (4) If this contract, order, or blanket purchase agreement does not 
require preparation of a receiving report on a prescribed form, the 
Contractor shall include on the invoice the following information at the 
line item level, in addition to that required in paragraph (c)(1) of 
this clause:
    (i) Ship-To Point.
    (ii) Mark-For Point.
    (iii) FEDSTRIP/MILSTRIP document number, if in the contract.
    (5) Where a receiving report is not required, the Contractor shall 
include a copy of the invoice in each shipment.
    (d) Certification of invoice. The Contractor certifies by submitting 
an invoice to the Government that the supplies being billed to the 
Government have been shipped or delivered in accordance with shipping 
instructions issued by the ordering officer, in the quantities shown on 
the invoice, and that the supplies are in the quantity and of the 
quality designated by the contract, order, or blanket purchase 
agreement.
    (e) Fast pay container identification. The Contractor shall mark all 
outer shipping containers ``FAST PAY.''

                             (End of clause)

[62 FR 64927, Dec. 9, 1997]



Sec.  52.213-2  Invoices.

    As prescribed in 13.302-5(b), insert the following clause:

                           Invoices (APR 1984)

    The Contractor's invoices must be submitted before payment can be 
made. The Contractor will be paid on the basis of the invoice, which 
must state (a) the starting and ending dates of the subscription 
delivery, and (b) either that orders have been placed in effect for the 
addressees required, or that the orders will be placed in effect upon 
receipt of payment.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 51 FR 2666, Jan. 17, 1986; 
60 FR 34761, July 3, 1995; 61 FR 39198, July 26, 1996; 62 FR 64928, Dec. 
9, 1997]



Sec.  52.213-3  Notice To Supplier.

    As prescribed in 13.302-5(c), insert the following clause:

[[Page 59]]

                      Notice to Supplier (APR 1984)

    This is a firm order ONLY if your price does not exceed the maximum 
line item or total price in the Schedule. Submit invoices to the 
Contracting Officer. If you cannot perform in exact accordance with this 
order, WITHHOLD PERFORMANCE and notify the Contracting Officer 
immediately, giving your quotation.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34761, July 3, 1995; 
61 FR 39198, July 26, 1996; 62 FR 64928, Dec. 9, 1997]



Sec.  52.213-4  Terms and Conditions--Simplified Acquisitions (Other Than Commercial Items).

    As prescribed in 13.302-5(d), insert the following clause:

  Terms and Conditions--Simplified Acquisitions (Other Than Commercial 
                            Items) (Oct 2003)

    (a) The Contractor shall comply with the following Federal 
Acquisition Regulation (FAR) clauses that are incorporated by reference:
    (1) The clauses listed below implement provisions of law or 
Executive order:
    (i) 52.222-3, Convict Labor (June 2003) (E.O. 11755).
    (ii) 52.222-21, Prohibition of Segregated Facilities (Feb 1999) 
(E.O. 11246).
    (iii) 52.222-26, Equal Opportunity (Apr 2002) (E.O. 11246).
    (iv) 52.225-13, Restrictions on Certain foreign Purchases (June 
2003) (E.O.'s 12722, 12724, 13059, 13067, 13121, 13129).
    (v) 52.233-3, Protest After Award (Aug 1996) (31 U.S.C. 3553).
    (2) Listed below are additional clauses that apply:
    (i) 52.232-1, Payments (Apr 1984).
    (ii) 52.232-8, Discounts for Prompt Payment (Feb 2002).
    (iii) 52.232-11, Extras (Apr 1984).
    (iv) 52.232-25, Prompt Payment (Feb 2002).
    (v) 52.233-1, Disputes (Jul 2002).
    (vi) 52.244-6, Subcontracts for Commercial Items (Apr. 2003).
    (vii) 52.253-1, Computer Generated Forms (Jan 1991).
    (b) The Contractor shall comply with the following FAR clauses, 
incorporated by reference, unless the circumstances do not apply:
    (1) The clauses listed below implement provisions of law or 
Executive order:
    (i) 52.222-19, Child Labor--Cooperation with Authorities and 
Remedies (Sept 2002) (E.O. 13126). (Applies to contracts for supplies 
exceeding the micro-purchase threshold.)
    (vii) 52.223-5, Pollution Prevention and Right-to-Know Information 
(Aug 2003) (E.O. 13148) (Applies to services performed on Federal 
facilities).
    (iii) 52.222-35, Equal Opportunity for Special Disabled Veterans, 
Veterans of the Vietnam Era, and Other Eligible Veterans (DEC 2001) (38 
U.S.C. 4212) (Applies to contracts of $25,000 or more).
    (iv) 52.222-36, Affirmative Action for Workers with Disabilities 
(June 1998) (29 U.S.C. 793). (Applies to contracts over $10,000, unless 
the work is to be performed outside the United States by employees 
recruited outside the United States.) (For purposes of this clause, 
United States includes the 50 States, the District of Columbia, Puerto 
Rico, the Northern Mariana Islands, American Samoa, Guam, the U.S. 
Virgin Islands, and Wake Island.)
    (v) 52.222-37, Employment Reports on Special Disabled Veterans, 
Veterans of the Vietnam Era, and Other Eligible Veterans (DEC 2001) (38 
U.S.C. 4212) (Applies to contracts of $25,000 or more).
    (vi) 52.222-41, Service Contract Act of 1965, As Amended (May 1989) 
(41 U.S.C. 351, et seq.) (Applies to service contracts over $2,500 that 
are subject to the Service Contract Act and will be performed in the 
United States, District of Columbia, Puerto Rico, the Northern Mariana 
Islands, American Samoa, Guam, the U.S. Virgin Islands, Johnston Island, 
Wake Island, or the outer continental shelf lands).
    (vii) 52.223-5, Pollution Prevention and Right-to-Know Information 
(APR 1998) (E.O. 12856) (Applies to services performed on Federal 
facilities).
    (viii) 52.225-1, Buy American Act--Supplies (June 2003) (41 U.S.C. 
10a-10d) (Applies to contracts for supplies, and to contracts for 
services involving the furnishing of supplies, for use in the United 
States or its outlying areas, if the value of the supply contract or 
supply portion of a service contract exceeds the micro-purchase 
threshold and the acquisition--
    (A) Is set aside for small business concerns; or
    (B) Cannot be set aside for small business concerns (see 19.502-2), 
and does not exceed $25,000.)
    (ix) 52.232-33, Payment by Electronic Funds Transfer--Central 
Contractor Registration (Oct 2003). (Applies when the payment will be 
made by electronic funds transfer (EFT) and the payment office uses the 
Central Contractor Registration (CCR) database as its source of EFT 
information.)
    (x) 52.232-34, Payment by Electronic Funds Transfer--Other than 
Central Contractor Registration (May 1999). (Applies when the payment 
will be made by EFT and the payment office does not use the CCR database 
as its source of EFT information.)

[[Page 60]]

    (xi) 52.247-64, Preference for Privately Owned U.S.-Flag Commercial 
Vessels (APR 2003) (46 U.S.C. Appx 1241). (Applies to supplies 
transported by ocean vessels (except for the types of subcontracts 
listed at 47.504(d).)
    (2) Listed below are additional clauses that may apply:
    (i) 52.209-6, Protecting the Government's Interest When 
Subcontracting with Contractors Debarred, Suspended, or Proposed for 
Debarment (JULY 1995) (Applies to contracts over $25,000).
    (ii) 52.211-17, Delivery of Excess Quantities (SEPT 1989) (Applies 
to fixed-price supplies).
    (iii) 52.247-29, F.o.b. Origin (JUN 1988) (Applies to supplies if 
delivery is f.o.b. origin).
    (iv) 52.247-34, F.o.b. Destination (NOV 1991) (Applies to supplies 
if delivery is f.o.b. destination).
    (c) FAR 52.252-2, Clauses Incorporated by Reference (FEB 1998). This 
contract incorporates one or more clauses by reference, with the same 
force and effect as if they were given in full text. Upon request, the 
Contracting Officer will make their full text available. Also, the full 
text of a clause may be accessed electronically at this/these 
address(es):

________________________________________________________________________

________________________________________________________________________

[Insert one or more Internet addresses]

    (d) Inspection/Acceptance. The Contractor shall tender for 
acceptance only those items that conform to the requirements of this 
contract. The Government reserves the right to inspect or test any 
supplies or services that have been tendered for acceptance. The 
Government may require repair or replacement of nonconforming supplies 
or reperformance of nonconforming services at no increase in contract 
price. The Government must exercise its postacceptance rights--
    (1) Within a reasonable period of time after the defect was 
discovered or should have been discovered; and
    (2) Before any substantial change occurs in the condition of the 
item, unless the change is due to the defect in the item.
    (e) Excusable delays. The Contractor shall be liable for default 
unless nonperformance is caused by an occurrence beyond the reasonable 
control of the Contractor and without its fault or negligence, such as 
acts of God or the public enemy, acts of the Government in either its 
sovereign or contractual capacity, fires, floods, epidemics, quarantine 
restrictions, strikes, unusually severe weather, and delays of common 
carriers. The Contractor shall notify the Contracting Officer in writing 
as soon as it is reasonably possible after the commencement of any 
excusable delay, setting forth the full particulars in connection 
therewith, shall remedy such occurrence with all reasonable dispatch, 
and shall promptly give written notice to the Contracting Officer of the 
cessation of such occurrence.
    (f) Termination for the Government's convenience. The Government 
reserves the right to terminate this contract, or any part hereof, for 
its sole convenience. In the event of such termination, the Contractor 
shall immediately stop all work hereunder and shall immediately cause 
any and all of its suppliers and subcontractors to cease work. Subject 
to the terms of this contract, the Contractor shall be paid a percentage 
of the contract price reflecting the percentage of the work performed 
prior to the notice of termination, plus reasonable charges that the 
Contractor can demonstrate to the satisfaction of the Government, using 
its standard record keeping system, have resulted from the termination. 
The Contractor shall not be required to comply with the cost accounting 
standards or contract cost principles for this purpose. This paragraph 
does not give the Government any right to audit the Contractor's 
records. The Contractor shall not be paid for any work performed or 
costs incurred that reasonably could have been avoided.
    (g) Termination for cause. The Government may terminate this 
contract, or any part hereof, for cause in the event of any default by 
the Contractor, or if the Contractor fails to comply with any contract 
terms and conditions, or fails to provide the Government, upon request, 
with adequate assurances of future performance. In the event of 
termination for cause, the Government shall not be liable to the 
Contractor for any amount for supplies or services not accepted, and the 
Contractor shall be liable to the Government for any and all rights and 
remedies provided by law. If it is determined that the Government 
improperly terminated this contract for default, such termination shall 
be deemed a termination for convenience.
    (h) Warranty. The Contractor warrants and implies that the items 
delivered hereunder are merchantable and fit for use for the particular 
purpose described in this contract.

                             (End of clause)

[62 FR 64928, Dec. 9, 1997, as amended at 63 FR 9052, 9058, Feb. 23, 
1998; 63 FR 34075, 34077, June 22, 1998; 64 FR 10542, Mar. 4, 1999; 64 
FR 32749, June 17, 1999; 64 FR 72433, Dec, 27, 1999; 65 FR 24324, Apr. 
25, 2000; 65 FR 36028, June 6, 2000; 66 FR 5349, Jan. 18, 2001; 66 FR 
53489, Oct. 22, 2001; 67 FR 65360, Dec. 18, 2001; 67 FR 6121, Feb. 8, 
2002; 67 FR 13067, Mar. 20, 2002; 67 FR 21536, Apr. 30, 2002; 67 FR 
43514, June 27, 2002; 67 FR 47635, July 19, 2002; 67 FR 56124, Aug. 30, 
2002; 68 FR 13203, Mar. 18, 2003; 68 FR 28098, May 22, 2003; 68 FR 
28084, 28098, May 22, 2003; 68 FR 43870, July 24, 2003; 68 FR 56675, 
Oct. 1, 2003]

[[Page 61]]


    Effective Date Notes: 1. At 68 FR 56684, Oct. 1, 2003, Sec.  52.213-
4 was amended by revising the date of the clause and paragraph 
(a)(2)(iv), effective Oct. 31, 2003. For the convenience of the user, 
the revised text is set forth below:

Sec.  52.213-4  Terms and Conditions--Simplified Acquisitions (Other 
          Than Commercial Items).

                                * * * * *

  Terms and Conditions--Simplified Acquisitions (Other Than Commercial 
                           Items) (Oct. 2003).

    (a) * * *
    (2) * * *
    (iv) 52.232-25, Prompt Payment (Oct. 2003).

                                * * * * *

    2. At 68 FR 56686, Oct. 1, 2003, Sec.  52.213-4 was amended by 
revising paragraph (a)(1)(iv), effective Oct. 31, 2003. For the 
convenience of the user, the revised text is set forth below:

Sec.  52.213-4  Terms and Conditions--Simplified Acquisitions (Other 
          Than Commercial Items).

                                * * * * *

    (a) * * *
    (1) * * *
    (iv) 52.225-13, Restrictions on Certain Foreign Purchases (Oct. 
2003) (E.o.s, proclamations, and statutes administered by the Office of 
Foreign Assets Control of the Department of the Treasury).

                                * * * * *



Sec.  52.214-1--52.214-2  [Reserved]



Sec.  52.214-3  Amendments to Invitations for Bids.

    As prescribed in 14.201-6(b)(1), insert the following provision:

              Amendments to Invitations for Bids (DEC 1989)

    (a) If this solicitation is amended, then all terms and conditions 
which are not modified remain unchanged.
    (b) Bidders shall acknowledge receipt of any amendment to this 
solicitation (1) by signing and returning the amendment, (2) by 
identifying the amendment number and date in space provided for this 
purpose on the form for submitting a bid, (3) by letter or telegram, or 
(4) by facsimile, if facsimile bids are authorized in the solicitation. 
The Government must receive the acknowledgment by the time and at the 
place specified for receipt of bids.

                           (End of provision)

[53 FR 43394, Oct. 26, 1988, as amended at 54 FR 48990, Nov. 28, 1989; 
67 FR 13056, Mar. 20, 2002]



Sec.  52.214-4  False Statements in Bids.

    As prescribed in 14.201-6(b)(2), insert the following provision in 
all invitations for bids:

                   False Statements in Bids (APR 1984)

    Bidders must provide full, accurate, and complete information as 
required by this solicitation and its attachments. The penalty for 
making false statements in bids is prescribed in 18 U.S.C. 1001.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 67 FR 13056, Mar. 20, 2002]



Sec.  52.214-5  Submission of Bids.

    As prescribed in 14.201-6(c)(1), insert the following provision:

                      Submission of Bids (MAR 1997)

    (a) Bids and bid modifications shall be submitted in sealed 
envelopes or packages (unless submitted by electronic means) (1) 
addressed to the office specified in the solicitation, and (2) showing 
the time and date specified for receipt, the solicitation number, and 
the name and address of the bidder.
    (b) Bidders using commercial carrier services shall ensure that the 
bid is addressed and marked on the outermost envelope or wrapper as 
prescribed in subparagraphs (a) (1) and (2) of this provision when 
delivered to the office specified in the solicitation.
    (c) Telegraphic bids will not be considered unless authorized by the 
solicitation; however, bids may be modified or withdrawn by written or 
telegraphic notice.
    (d) Facsimile bids, modifications, or withdrawals, will not be 
considered unless authorized by the solicitation.
    (e) Bids submitted by electronic commerce shall be considered only 
if the electronic commerce method was specifically stipulated or 
permitted by the solicitation.

                           (End of provision)

[54 FR 48991, Nov. 28, 1989, as amended at 55 FR 3887, Feb. 5, 1990; 60 
FR 34739, July 3, 1995; 61 FR 69293, Dec. 31, 1996; 62 FR 12721, Mar. 
17, 1997]

[[Page 62]]



Sec.  52.214-6  Explanation to Prospective Bidders.

    As prescribed in 14.201-6(c)(2), insert the following provision:

              Explanation to Prospective Bidders (APR 1984)

    Any prospective bidder desiring an explanation or interpretation of 
the solicitation, drawings, specifications, etc., must request it in 
writing soon enough to allow a reply to reach all prospective bidders 
before the submission of their bids. Oral explanations or instructions 
given before the award of a contract will not be binding. Any 
information given a prospective bidder concerning a solicitation will be 
furnished promptly to all other prospective bidders as an amendment to 
the solicitation, if that information is necessary in submitting bids or 
if the lack of it would be prejudicial to other prospective bidders.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 25531, June 21, 1990]



Sec.  52.214-7  Late submissions, modifications, and withdrawals of bids.

    As prescribed in 14.201-6(c)(3), insert the following provision:

   Late Submissions, Modifications, and Withdrawals of Bids (NOV 1999)

    (a) Bidders are responsible for submitting bids, and any 
modifications or withdrawals, so as to reach the Government office 
designated in the invitation for bids (IFB) by the time specified in the 
IFB. If no time is specified in the IFB, the time for receipt is 4:30 
p.m., local time, for the designated Government office on the date that 
bids are due.
    (b)(1) Any bid, modification, or withdrawal received at the 
Government office designated in the IFB after the exact time specified 
for receipt of bids is ``late'' and will not be considered unless it is 
received before award is made, the Contracting Officer determines that 
accepting the late bid would not unduly delay the acquisition; and--
    (i) If it was transmitted through an electronic commerce method 
authorized by the IFB, it was received at the initial point of entry to 
the Government infrastructure not later than 5:00 p.m. one working day 
prior to the date specified for receipt of bids; or
    (ii) There is acceptable evidence to establish that it was received 
at the Government installation designated for receipt of bids and was 
under the Government's control prior to the time set for receipt of 
bids.
    (2) However, a late modification of an otherwise successful bid that 
makes its terms more favorable to the Government, will be considered at 
any time it is received and may be accepted.
    (c) Acceptable evidence to establish the time of receipt at the 
Government installation includes the time/date stamp of that 
installation on the bid wrapper, other documentary evidence of receipt 
maintained by the installation, or oral testimony or statements of 
Government personnel.
    (d) If an emergency or unanticipated event interrupts normal 
Government processes so that bids cannot be received at the Government 
office designated for receipt of bids by the exact time specified in the 
IFB and urgent Government requirements preclude amendment of the IFB, 
the time specified for receipt of bids will be deemed to be extended to 
the same time of day specified in the solicitation on the first work day 
on which normal Government processes resume.
    (e) Bids may be withdrawn by written notice received at any time 
before the exact time set for receipt of bids. If the IFB authorizes 
facsimile bids, bids may be withdrawn via facsimile received at any time 
before the exact time set for receipt of bids, subject to the conditions 
specified in the provision at 52.214-31, Facsimile Bids. A bid may be 
withdrawn in person by a bidder or its authorized representative if, 
before the exact time set for receipt of bids, the identity of the 
person requesting withdrawal is established and the person signs a 
receipt for the bid.

                           (End of provision)

[64 FR 51840, Sept. 24, 1999]



Sec.  52.214-8  [Reserved]



Sec.  52.214-9  [Reserved]



Sec.  52.214-10  Contract Award--Sealed Bidding.

    As prescribed in 14.201-6(e), insert the following provision:

                Contract Award--Sealed Bidding (JUL 1990)

    (a) The Government will evaluate bids in response to this 
solicitation without discussions and will award a contract to the 
responsible bidder whose bid, conforming to the solicitation, will be 
most advantageous to the Government considering only price and the 
price-related factors specified elsewhere in the solicitation.
    (b) The Government may (1) reject any or all bids, (2) accept other 
than the lowest bid, and (3) waive informalities or minor irregularities 
in bids received.
    (c) The Government may accept any item or group of items of a bid, 
unless the bidder qualifies the bid by specific limitations. Unless 
otherwise provided in the Schedule, bids

[[Page 63]]

may be submitted for quantities less than those specified. The 
Government reserves the right to make an award on any item for a 
quantity less than the quantity offered, at the unit prices offered, 
unless the bidder specifies otherwise in the bid.
    (d) A written award or acceptance of a bid mailed or otherwise 
furnished to the successful bidder within the time for acceptance 
specified in the bid shall result in a binding contract without further 
action by either party.
    (e) The Government may reject a bid as nonresponsive if the prices 
bid are materially unbalanced between line items or subline items. A bid 
is materially unbalanced when it is based on prices significantly less 
than cost for some work and prices which are significantly overstated in 
relation to cost for other work, and if there is a reasonable doubt that 
the bid will result in the lowest overall cost to the Government even 
though it may be the low evaluated bid, or if it is so unbalanced as to 
be tantamount to allowing an advance payment.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 1746, Jan. 11, 1985; 
50 FR 52429, Dec. 23, 1985; 55 FR 25531, June 21, 1990; 68 FR 43857, 
July 24, 2003]



Sec.  52.214-11  [Reserved]



Sec.  52.214-12  Preparation of Bids.

    As prescribed in 14.201-6(f), insert the following provision:

                     Preparation of Bids (APR 1984)

    (a) Bidders are expected to examine the drawings, specifications, 
Schedule, and all instructions. Failure to do so will be at the bidder's 
risk.
    (b) Each bidder shall furnish the information required by the 
solicitation. The bidder shall sign the bid and print or type its name 
on the Schedule and each continuation sheet on which it makes an entry. 
Erasures or other changes must be initialed by the person signing the 
bid. Bids signed by an agent shall be accompanied by evidence of that 
agent's authority, unless that evidence has been previously furnished to 
the issuing office.
    (c) For each item offered, bidders shall (1) show the unit price, 
including, unless otherwise specified, packaging, packing, and 
preservation and (2) enter the extended price for the quantity of each 
item offered in the Amount column of the Schedule. In case of 
discrepancy between a unit price and an extended price, the unit price 
will be presumed to be correct, subject, however, to correction to the 
same extent and in the same manner as any other mistake.
    (d) Bids for supplies or services other than those specified will 
not be considered unless authorized by the solicitation.
    (e) Bidders must state a definite time for delivery of supplies or 
for performance of services, unless otherwise specified in the 
solicitation.
    (f) Time, if stated as a number of days, will include Saturdays, 
Sundays, and holidays.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 51 FR 2666, Jan. 17, 1986]



Sec.  52.214-13  Telegraphic Bids.

    As prescribed in 14.201-6(g)(1), insert the following provision:

                       Telegraphic Bids (APR 1984)

    (a) Bidders may submit telegraphic bids as responses to this 
solicitation. These responses must arrive at the place, and by the time, 
specified in the solicitation.
    (b) Telegraphic bids shall refer to this solicitation and include 
the items or subitems, quantities, unit prices, time and place of 
delivery, all representations and other information required by this 
solicitation, and a statement of agreement with all the terms, 
conditions, and provisions of the invitation for bids.
    (c) Telegraphic bids that fail to furnish required representations 
or information, or that reject any of the terms, conditions, and 
provisions of the solicitation, may be excluded from consideration.
    (d) Bidders must promptly sign and submit complete copies of the 
bids in confirmation of their telegraphic bids.
    (e) The term telegraphic bids, as used in this provision, includes 
mailgrams.

                           (End of provision)

    Alternate I (NOV 1988). As prescribed in 14.201-6(g)(2), substitute 
the following for paragraph (d) of the basic clause:

    (d) Written confirmation of telegraphic bids is not required.

[48 FR 42478, Sept. 19, 1983, as amended at 53 FR, 43394, Oct. 26, 1988]



Sec.  52.214-14  Place of Performance--Sealed Bidding.

    As prescribed in 14.201-6(h), insert the following provision:

             Place of Performance--Sealed Bidding (APR 1985)

    (a) The bidder, in the performance of any contract resulting from 
this solicitation, [squ] intends, [squ] does not intend [check 
applicable

[[Page 64]]

box] to use one or more plants or facilities located at a different 
address from the address of the bidder as indicated in this bid.
    (b) If the bidder checks intends in paragraph (a) above, it shall 
insert in the spaces provided below the required information:

 
                                         Name and Address of
Place of Performance (Street Address,   Owner and Operator of
    City, County, State, Zip Code)      the Plant or Facility
                                         if Other than Bidder
 
 
------------------------------------------------------------------------
 
------------------------------------------------------------------------
 
------------------------------------------------------------------------
 

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 1746, Jan. 11, 1985; 
50 FR 52429, Dec. 23, 1985]



Sec.  52.214-15  Period for Acceptance of Bids.

    As prescribed in 14.201-6(i), insert the following provision:

                Period for Acceptance of Bids (APR 1984)

    In compliance with the solicitation, the bidder agrees, if this bid 
is accepted within -- calendar days (60 calendar days unless a different 
period is inserted by the bidder) from the date specified in the 
solicitation for receipt of bids, to furnish any or all items upon which 
prices are bid at the price set opposite each item, delivered at the 
designated point(s), within the time specified in the Schedule.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 48991, Nov. 28, 1989]



Sec.  52.214-16  Minimum Bid Acceptance Period.

    As prescribed in 14.201-6(j), insert the following provision in 
invitations for bids, except for construction, if the contracting 
officer determines that a minimum acceptance period must be specified:

                Minimum Bid Acceptance Period (APR 1984)

    (a) Acceptance period, as used in this provision, means the number 
of calendar days available to the Government for awarding a contract 
from the date specified in this solicitation for receipt of bids.
    (b) This provision supersedes any language pertaining to the 
acceptance period that may appear elsewhere in this solicitation.
    (c) The Government requires a minimum acceptance period of -- 
calendar days [the Contracting Officer shall insert the number of days].
    (d) In the space provided immediately below, bidders may specify a 
longer acceptance period than the Government's minimum requirement.

  The bidder allows the following acceptance period: -- calendar days.

    (e) A bid allowing less than the Government's minimum acceptance 
period will be rejected.
    (f) The bidder agrees to execute all that it has undertaken to do, 
in compliance with its bid, if that bid is accepted in writing within 
(1) the acceptance period stated in paragraph (c) above or (2) any 
longer acceptance period stated in paragraph (d) above.

                           (End of provision)



Sec.  52.214-17  [Reserved]



Sec.  52.214-18  Preparation of Bids--Construction.

    As prescribed in 14.201-6(l), insert the following provision:

              Preparation of Bids--Construction (APR 1984)

    (a) Bids must be (1) submitted on the forms furnished by the 
Government or on copies of those forms, and (2) manually signed. The 
person signing a bid must initial each erasure or change appearing on 
any bid form.
    (b) The bid form may require bidders to submit bid prices for one or 
more items on various bases, including--
    (1) Lump sum bidding;
    (2) Alternate prices;
    (3) Units of construction; or
    (4) Any combination of subparagraphs (1) through (3) above.
    (c) If the solicitation requires bidding on all items, failure to do 
so will disqualify the bid. If bidding on all items is not required, 
bidders should insert the words no bid in the space provided for any 
item on which no price is submitted.
    (d) Alternate bids will not be considered unless this solicitation 
authorizes their submission.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 25531, June 21, 1990]



Sec.  52.214-19  Contract Award--Sealed Bidding--Construction.

    As prescribed in 14.201-6(m), insert the following provision:

[[Page 65]]

         Contract Award--Sealed Bidding--Construction (AUG 1996)

    (a) The Government will evaluate bids in response to this 
solicitation without discussions and will award a contract to the 
responsible bidder whose bid, conforming to the solicitation, will be 
most advantageous to the Government, considering only price and the 
price-related factors specified elsewhere in the solicitation.
    (b) The Government may reject any or all bids, and waive 
informalities or minor irregularities in bids received.
    (c) The Government may accept any item or combination of items, 
unless doing so is precluded by a restrictive limitation in the 
solicitation or the bid.
    (d) The Government may reject a bid as nonresponsive if the prices 
bid are materially unbalanced between line items or subline items. A bid 
is materially unbalanced when it is based on prices significantly less 
than cost for some work and prices which are significantly overstated in 
relation to cost for other work, and if there is a reasonable doubt that 
the bid will result in the lowest overall cost to the Government even 
though it may be the low evaluated bid, or if it is so unbalanced as to 
be tantamount to allowing an advance payment.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 1746, Jan. 11, 1985; 
50 FR 52434, Dec. 23, 1985; 61 FR 31664, June 20, 1996]



Sec.  52.214-20  Bid Samples.

    As prescribed in 14.201-6(o)(1), insert the following provision:

                         Bid Samples (APR 2002)

    (a) Bid sample means a product sample required to be submitted by a 
bidder to show those characteristics of the offered products that cannot 
adequately be described by specifications, purchase descriptions, or the 
invitation for bid (e.g., balance, facility of use, or pattern).
    (b) Bidders must furnish bid samples as part of the bid. The 
Government must receive the bid samples by the time specified in the 
invitation for bids. If the bidder fails to submit samples on time, the 
Government will reject the bid, except that the Contracting Officer will 
consider a late sample sent by mail under the Late Submissions, 
Modifications, and Withdrawals of Bids provision of this solicitation.
    (c) The Government will test or evaluate bid samples to determine 
compliance with all the characteristics listed for examination in this 
solicitation. The Government will reject the bid when the sample fails 
to conform to the required characteristics. Products delivered under any 
resulting contract must conform to--
    (1) the approved sample for the characteristics listed for test or 
evaluation and
    (2) the specifications for all other characteristics.
    (d) Unless otherwise specified in the solicitation, bid samples 
shall be (1) submitted at no expense to the Government, and (2) returned 
at the bidder's request and expense, unless they are destroyed during 
preaward testing.

                           (End of provision)

    Alternate I (May 2002). As prescribed in 14.201-6(o)(2)(i), insert 
the following Alternate I:

    (e) At the discretion of the Contracting Officer, the requirement 
for furnishing bid samples may be waived for a bidder if (1) the bid 
states that the offered product is the same as a product offered by the 
bidder to the ---- [as appropriate, the Contracting Officer shall 
designate the contracting office or an alternate activity or office], 
and (2) the Contracting Officer determines that the previously offered 
product was accepted or tested and found to comply with specification 
and other requirements for technical acceptability conforming in every 
material respect with those in this solicitation.

    Alternate II (May 2002). As prescribed in 14.201-6(o)(2)(ii), insert 
the following Alternate II:

    (e) At the discretion of the Contracting Officer, the requirements 
for furnishing bid samples may be waived for a bidder if (1) the bid 
states that the offered product is the same as a product offered by the 
bidder to the ---- [as appropriate, the Contracting Officer shall 
designate the contracting office or an alternate activity or office] on 
a previous acquisition, (2) the Contracting Officer determines that the 
previously offered product was accepted or tested and found to comply 
with specification and other requirements for technical acceptability 
conforming in every material respect with those of this solicitation, 
and (3) the product offered under this solicitation will be produced 
under a resulting contract at the same plant in which the previously 
acquired or tested product was produced.

[48 FR 42478, Sept. 19, 1983, as amended at 67 FR 13056, Mar. 20, 2002; 
67 FR 21536, Apr. 30, 2002]



Sec.  52.214-21  Descriptive Literature.

    As prescribed in 14.201-6(p)(1), insert the following provision:

[[Page 66]]

                    Descriptive Literature (Apr 2002)

    (a) Descriptive literature, as used in this provision, means 
information furnished by a bidder, such as cuts, illustrations, 
drawings, and brochures, that shows a product's characteristics or 
construction or explains its operation. The term includes only that 
information required to evaluate the acceptability of the product and 
excludes other information for operating or maintaining the product.
    (b) Descriptive literature is required to establish, for the purpose 
of evaluation and award, details of the product offered that are 
specified elsewhere in the solicitation and pertain to significant 
elements such as--
    (1) Design;
    (2) Materials;
    (3) Components;
    (4) Performance characteristics; and
    (5) Methods of manufacture, assembly, construction, or operation.
    (c) Descriptive literature, required elsewhere in this solicitation, 
shall be--
    (1) Identified to show the item(s) of the offer to which it applies; 
and
    (2) Received by the time specified in this solicitation.
    (d) If the bidder fails to submit descriptive literature on time, 
the Government will reject the bid, except that late descriptive 
literature sent by mail may be considered under the Late Submissions, 
Modifications, and Withdrawals of Bids provision of this solicitation.
    (e) If the descriptive literature fails to show that the product 
offered conforms to the requirements of the solicitation, the Government 
will reject the bid.

                           (End of provision)

    Alternate I (Apr 2002). As prescribed in 14.201-6(p)(2), add the 
following paragraphs (f) and (g) to the basic provision:

    (f) The Contracting Officer may waive the requirement for furnishing 
descriptive literature if the offeror has supplied a product that is the 
same as that required by this solicitation under a prior contract. A 
bidder that requests a waiver of this requirement shall provide the 
following information:

 Prior contract number__________________________________________________
 Date of prior contract_________________________________________________
Contract line item number of product
 supplied_______________________________________________________________
 Name and address of Government activity to which delivery was made_____
Date of final delivery product supplied
________________________________________________________________________

    (g) Bidders shall submit bids on the basis of required descriptive 
literature or on the basis of a previously supplied product under 
paragraph (f) of this provision. A bidder submitting a bid on one of 
these two bases may not elect to have its bid considered on the 
alternative basis after the time specified for receipt of bids. The 
Government will disregard a bidder's request for a waiver under 
paragraph (f) if that bidder has submitted the descriptive literature 
requested under this solicitation.

[67 FR 13056, Mar. 20, 2002]



Sec.  52.214-22  Evaluation of Bids for Multiple Awards.

    As prescribed in 14.201-6(q), insert the following provision:

            Evaluation of Bids for Multiple Awards (MAR 1990)

    In addition to other factors, bids will be evaluated on the basis of 
advantages and disadvantages to the Government that might result from 
making more than one award (multiple awards). It is assumed, for the 
purpose of evaluating bids, that $500 would be the administrative cost 
to the Government for issuing and administering each contract awarded 
under this solicitation, and individual awards will be for the items or 
combinations of items that result in the lowest aggregate cost to the 
Government, including the assumed administrative costs.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 3887, Feb. 5, 1990]



Sec.  52.214-23  Late submissions, modifications, revisions, and withdrawals 
of technical proposals under two-step sealed bidding.

    As prescribed in 14.201-6(r), insert the following provision:

Late Submissions, Modifications, Revisions, and Withdrawals of Technical 
           Proposals Under Two-Step Sealed Bidding (NOV 1999)

    (a) Bidders are responsible for submitting technical proposals, and 
any modifications or revisions, so as to reach the Government office 
designated in the request for technical proposals by the time specified 
in the invitation for bids (IFB). If no time is specified in the IFB, 
the time for receipt is 4:30 p.m., local time, for the designated 
Government office on the date that bids or revisions are due.

[[Page 67]]

    (b)(1) Any technical proposal under step one of two-step sealed 
bidding or modification, revision, or withdrawal of such proposal 
received at the Government office designated in the request for 
technical proposals after the exact time specified for receipt will not 
be considered unless the Contracting Officer determines that accepting 
the late technical proposal would not unduly delay the acquisition; 
and--
    (i) If it was transmitted through an electronic commerce method 
authorized by the request for technical proposals, it was received at 
the initial point of entry to the Government infrastructure not later 
than 5:00 p.m. one working day prior to the date specified for receipt 
of proposals; or
    (ii) There is acceptable evidence to establish that it was received 
at the Government installation designated for receipt of offers and was 
under the Government's control prior to the time set for receipt; or
    (iii) It is the only proposal received and it is negotiated under 
part 15 of the Federal Acquisition Regulation.
    (2) However, a late modification of an otherwise successful proposal 
that makes its terms more favorable to the Government will be considered 
at any time it is received and may be accepted.
    (c) Acceptable evidence to establish the time of receipt at the 
Government installation includes the time/date stamp of that 
installation on the technical proposal wrapper, other documentary 
evidence of receipt maintained by the installation, or oral testimony or 
statements of Government personnel.
    (d) If an emergency or unanticipated event interrupts normal 
Government processes so that technical proposals cannot be received at 
the Government office designated for receipt of technical proposals by 
the exact time specified in the request for technical proposals, and 
urgent Government requirements preclude amendment of the request for 
technical proposals, the time specified for receipt of technical 
proposals will be deemed to be extended to the same time of day 
specified in the request for technical proposals on the first work day 
on which normal Government processes resume.
    (e) Technical proposals may be withdrawn by written notice received 
at any time before the exact time set for receipt of technical 
proposals. If the request for technical proposals authorizes facsimile 
technical proposals, they may be withdrawn via facsimile received at any 
time before the exact time set for receipt of proposals, subject to the 
conditions specified in the provision at 52.214-31, Facsimile Bids. A 
technical proposal may be withdrawn in person by a bidder or its 
authorized representative if, before the exact time set for receipt of 
technical proposals, the identity of the person requesting withdrawal is 
established and the person signs a receipt for the technical proposal.

                           (End of provision)

[64 FR 51840, Sept. 24, 1999]



Sec.  52.214-24  Multiple Technical Proposals.

    As prescribed in 14.201-6(s), insert the following provision:

                 Multiple Technical Proposals (APR 1984)

    In the first step of this two-step acquisition, solicited sources 
are encouraged to submit multiple technical proposals presenting 
different basic approaches. Each technical proposal submitted will be 
separately evaluated and the submitter will be notified as to its 
acceptability.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 1747, Jan. 11, 1985; 
50 FR 52429, Dec. 23, 1985]



Sec.  52.214-25  Step Two of Two-Step Sealed Bidding.

    As prescribed in 14.201-6(t), insert the following provision:

             Step Two of Two-Step Sealed Bidding (APR 1985)

    (a) This invitation for bids is issued to initiate step two of two-
step sealed bidding under subpart 14.5 of the Federal Acquisition 
Regulation.
    (b) The only bids that the Contracting Officer may consider for 
award of a contract are those received from bidders that have submitted 
acceptable technical proposals in step one of this acquisition under --
-- [the Contracting Officer shall insert the identification of the step-
one request for technical proposals].
    (c) Any bidder that has submitted multiple technical proposals in 
step one of this acquisition may submit a separate bid on each technical 
proposal that was determined to be acceptable to the Government.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 1747, Jan. 11, 1985; 
50 FR 52429, Dec. 23, 1985]



Sec.  52.214-26  Audit and Records--Sealed Bidding.

    As prescribed in 14.201-7(a), insert the following clause:

              Audit and Records--Sealed Bidding (OCT 1997)

    (a) As used in this clause, records includes books, documents, 
accounting procedures

[[Page 68]]

and practices, and other data, regardless of type and regardless of 
whether such items are in written form, in the form of computer data, or 
in any other form.
    (b) Cost or pricing data. If the Contractor has been required to 
submit cost or pricing data in connection with the pricing of any 
modification to this contract, the Contracting Officer, or an authorized 
representative of the Contracting Officer, in order to evaluate the 
accuracy, completeness, and currency of the cost or pricing data, shall 
have the right to examine and audit all of the Contractor's records, 
including computations and projections, related to--
    (1) The proposal for the modification;
    (2) The discussions conducted on the proposal(s), including those 
related to negotiating;
    (3) Pricing of the modification; or
    (4) Performance of the modification.
    (c) Comptroller General. In the case of pricing any modification, 
the Comptroller General of the United States, or an authorized 
representative, shall have the same rights as specified in paragraph (b) 
of this clause.
    (d) Availability. The Contractor shall make available at its office 
at all reasonable times the materials described in paragraph (b) of this 
clause, for examination, audit, or reproduction, until 3 years after 
final payment under this contract, or for any other period specified in 
subpart 4.7 of the Federal Acquisition Regulation (FAR). FAR Subpart 
4.7, Contractor Records Retention, in effect on the data of this 
contract, is incorporated by reference in its entirety and made a part 
of this contract.
    (1) If this contract is completely or partially terminated, the 
records relating to the work terminated shall be made available for 3 
years after any resulting final termination settlement.
    (2) Records pertaining to appeals under the Disputes clause or to 
litigation or the settlement of claims arising under or relating to the 
performance of this contract shall be made available until disposition 
of such appeals, litigation, or claims.
    (e) The Contractor shall insert a clause containing all the 
provisions of this clause, including this paragraph (e), in all 
subcontracts expected to exceed the threshold in FAR 15.403-4(a)(1) for 
submission of cost or pricing data.

                             (End of clause)

[60 FR 42651, Aug. 16, 1995; 60 FR 44548, Aug. 28, 1995; 62 FR 51271, 
Sept. 30, 1997]



Sec.  52.214-27  Price Reduction for Defective Cost or Pricing Data--
Modifications--Sealed Bidding.

    As prescribed in 14.201-7(b), insert the following clause:

   Price Reduction for Defective Cost or Pricing Data--Modifications--
                        Sealed Bidding (OCT 1997)

    (a) This clause shall become operative only for any modification to 
this contract involving aggregate increases and/or decreases in costs, 
plus applicable profits, expected to exceed the threshold for the 
submission of cost or pricing data at FAR 15.403-4(a)(1), except that 
this clause does not apply to a modification if an exception under FAR 
15.403-1(b) applies.
    (b) If any price, including profit, negotiated in connection with 
any modification under this clause, was increased by any significant 
amount because (1) the Contractor or a subcontractor furnished cost or 
pricing data that were not complete, accurate, and current as certified 
in its Certificate of Current Cost or Pricing Data, (2) a subcontractor 
or prospective subcontractor furnished the Contractor cost or pricing 
data that were not complete, accurate, and current as certified in the 
Contractor's Certificate of Current Cost or Pricing Data, or (3) any of 
these parties furnished data of any description that were not accurate, 
the price shall be reduced accordingly and the contract shall be 
modified to reflect the reduction. This right to a price reduction is 
limited to that resulting from defects in data relating to modifications 
for which this clause becomes operative under paragraph (a) above.
    (c) Any reduction in the contract price under paragraph (b) above 
due to defective data from a prospective subcontractor that was not 
subsequently awarded the subcontract shall be limited to the amount, 
plus applicable overhead and profit markup, by which (1) the actual 
subcontract or (2) the actual cost to the Contractor, if there was no 
subcontract, was less than the prospective subcontract cost estimate 
submitted by the Contractor; provided, that the actual subcontract price 
was not itself affected by defective cost or pricing data.
    (d)(1) If the Contracting Officer determines under paragraph (b) of 
this clause that a price or cost reduction should be made, the 
Contractor agrees not to raise the following matters as a defense--
    (i) The Contractor or subcontractor was a sole source supplier or 
otherwise was in a superior bargaining position and thus the price of 
the contract would not have been modified even if accurate, complete, 
and current cost or pricing data had been submitted;
    (ii) The Contracting Officer should have known that the cost or 
pricing data in issue were defective even though the Contractor or 
subcontractor took no affirmative action to bring the character of the 
data to the attention of the Contracting Officer;
    (iii) The contract was based on an agreement about the total cost of 
the contract

[[Page 69]]

and there was no agreement about the cost of each item procured under 
the contract; or
    (iv) The Contractor or subcontractor did not submit a Certificate of 
Current Cost or Pricing Data.
    (2)(i) Except as prohibited by subdivision (d)(2)(ii) of this 
clause, an offset in an amount determined appropriate by the Contracting 
Officer based upon the facts shall be allowed against the amount of a 
contract price reduction if--
    (A) The Contractor certifies to the Contracting Officer that, to the 
best of the Contractor's knowledge and belief, the Contractor is 
entitled to the offset in the amount requested; and
    (B) The Contractor proves that the cost or pricing data were 
available before the date of agreement on the price of the contract (or 
price of the modification) and that the data were not submitted before 
such date.
    (ii) An offset shall not be allowed if--
    (A) The understated data was known by the Contractor to be 
understated when the Certificate of Current Cost or Pricing Data was 
signed; or
    (B) The Government proves that the facts demonstrate that the 
contract price would not have increased in the amount to be offset even 
if the available data had been submitted before the date of agreement on 
price.
    (e) If any reduction in the contract price under this clause reduces 
the price of items for which payment was made prior to the date of the 
modification reflecting the price reduction, the Contractor shall be 
liable to and shall pay the United States at the time such overpayment 
is repaid--
    (1) Simple interest on the amount of such overpayment to be computed 
from the date(s) of overpayment to the Contractor to the date the 
Government is repaid by the Contractor at the applicable underpayment 
rate effective for each quarter prescribed by the Secretary of the 
Treasury under 26 U.S.C. 6621(a)(2); and
    (2) A penalty equal to the amount of the overpayment, if the 
Contractor or subcontractor knowingly submitted cost or pricing data 
which were incomplete, inaccurate, or noncurrent.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 1747, Jan. 11, 1985; 
50 FR 52429, Dec. 23, 1985; 53 FR 10830, Apr. 1, 1988; 55 FR 52797, Dec. 
21, 1990; 56 FR 67415, Dec. 30, 1991; 60 FR 48218, Sept. 18, 1995; 62 FR 
51271, Sept. 30, 1997]



Sec.  52.214-28  Subcontractor Cost or Pricing Data--Modifications--Sealed Bidding.

    As prescribed in 14.201-7(c), insert the following clause:

 Subcontractor Cost or Pricing Data--Modifications--Sealed Bidding (OCT 
                                  1997)

    (a) The requirements of paragraphs (b) and (c) of this clause shall 
(1) become operative only for any modification to this contract 
involving aggregate increases and/or decreases in costs, plus applicable 
profits, expected to exceed the threshold for submission of cost or 
pricing data at (FAR) 48 CFR 15.403-4(a)(1), and (2) be limited to such 
modifications.
    (b) Before awarding any subcontract expected to exceed the threshold 
for submission of cost or pricing data at FAR 15.403-4(a)(1), on the 
date of agreement on price or the date of award, whichever is later; or 
before pricing any subcontract modifications involving aggregate 
increases and/or decreases in costs, plus applicable profits, expected 
to exceed the threshold for submission of cost or pricing data at FAR 
15.403-4(a)(1), the Contractor shall require the subcontractor to submit 
cost or pricing data (actually or by specific identification in 
writing), unless an exception under FAR 15.403-1(b) applies.
    (c) The Contractor shall require the subcontractor to certify in 
substantially the form prescribed in subsection 15.406-2 of the Federal 
Acquisition Regulation that, to the best of its knowledge and belief, 
the data submitted under paragraph (b) above were accurate, complete, 
and current as of the date of agreement on the negotiated price of the 
subcontract or subcontract modification.
    (d) The Contractor shall insert the substance of this clause, 
including this paragraph (d), in each subcontract that, when entered 
into, exceeds the threshold for submission of cost or pricing data at 
FAR 15.403-4(a)(1).

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 1747, Jan. 11, 1985; 
50 FR 52429, Dec. 23, 1985; 56 FR 67415, Dec. 30, 1991; 59 FR 62499, 
Dec. 5, 1994; 60 FR 48218, Sept. 18, 1995; 62 FR 51271, Sept. 30, 1997]



Sec.  52.214-29  Order of Precedence--Sealed Bidding.

    As prescribed in 14.201-7(d), insert the following clause:

[[Page 70]]

             Order of Precedence--Sealed Bidding (JAN 1986)

    Any inconsistency in this solicitation or contract shall be resolved 
by giving precedence in the following order: (a) the Schedule (excluding 
the specifications); (b) representations and other instructions; (c) 
contract clauses; (d) other documents, exhibits, and attachments; and 
(e) the specifications.

                             (End of clause)

[51 FR 2666, Jan. 17, 1986, as amended at 60 FR 48218, Sept. 18, 1995]



Sec.  52.214-30  Annual Representations and Certifications--Sealed Bidding.

    As prescribed in 14.201-6(u), insert the following provision:

  Annual Representations and Certifications--Sealed Bidding (JAN 1997)

    The bidder has (check the appropriate block):
    [squ] (a) Submitted to the contracting office issuing this 
solicitation, annual representations and certifications dated ------ 
[insert date of signature on submission], which are incorporated herein 
by reference, and are current, accurate, and complete as of the date of 
this bid, except as follows [insert changes that affect only this 
solicitation; if ``none,'' so state]:

________________________________________________________________________
    [squ] (b) Enclosed its annual representations and certifications.

                           (End of provision)

[62 FR 238, Jan. 2, 1997]



Sec.  52.214-31  Facsimile Bids.

    As prescribed in 14.201-6(v), insert the following provision:

                        Facsimile Bids (DEC 1989)

    (a) Definition. Facsimile bid, as used in this solicitation, means a 
bid, modification of a bid, or withdrawal of a bid that is transmitted 
to and received by the Government via electronic equipment that 
communicates and reproduces both printed and handwritten material.
    (b) Bidders may submit facsimile bids as responses to this 
solicitation. These responses must arrive at the place and by the time, 
specified in the solicitation.
    (c) Facsimile bids that fail to furnish required representations or 
information or that reject any of the terms, conditions, and provisions 
of the solicitation may be excluded from consideration.
    (d) Facsimile bids must contain the required signatures.
    (e) The Government reserves the right to make award solely on the 
facsimile bid. However, if requested to do so by the Contracting 
Officer, the apparently successful bidder agrees to promptly submit the 
complete original signed bid.
    (f) Facsimile receiving data and compatibility characteristics are 
as follows:
    (1) Telephone number of receiving facsimile equipment:
________________________________________________________________________
    (2) Compatibility characteristics of receiving facsimile equipment 
(e.g., make and model number, receiving speed, communications protocol):
________________________________________________________________________
________________________________________________________________________
    (g) If the bidder chooses to transmit a facsimile bid, the 
Government will not be responsible for any failure attributable to the 
transmission or receipt of the facsimile bid including, but not limited 
to, the following:
    (1) Receipt of garbled or incomplete bid.
    (2) Availability or condition of the receiving facsimile equipment.
    (3) Incompatibility between the sending and receiving equipment.
    (4) Delay in transmission or receipt of bid.
    (5) Failure of the bidder to properly identify the bid.
    (6) Illegibility of bid.
    (7) Security of bid data.

                           (End of provision)

[54 FR 48992, Nov. 28, 1989, as amended at 64 FR 51841, Sept. 24, 1999]



Sec.  52.214-32  Late Submissions, Modifications, and Withdrawals of Bids (Overseas).

    As prescribed in 14.201-6(c)(4), insert the following provision:

Late Submissions, Modifications, and Withdrawals of Bids (Overseas) (MAY 
                                  1997)

    (a) Any bid received at the office designated in the solicitation 
after the exact time specified for receipt will not be considered unless 
it is received before award is made and it--
    (1) Was sent by mail (or telegram or facsimile, if authorized) or 
hand-carried (including delivery by a commercial carrier) if it is 
determined by the Government that the late receipt was due primarily to 
Government mishandling after receipt at the Government installation; or
    (2) Was transmitted through an electronic commerce method authorized 
by the solicitation and was received at the initial point of entry to 
the Government infrastructure not later than 5:00 p.m. one working day 
prior to the date specified for receipt of bids.

[[Page 71]]

The term working day excludes weekends and U.S. Federal holidays.
    (b) Any modification or withdrawal of a bid is subject to the same 
conditions as in paragraph (a) of this provision.
    (c) The only acceptable evidence to establish the time of receipt at 
the Government installation is the time/date stamp of that installation 
on the bid wrapper or other documentary evidence of receipt maintained 
by the installation.
    (d) Notwithstanding paragraph (a) of this provision, a late 
modification of an otherwise successful bid that makes its terms more 
favorable to the Government will be considered at any time it is 
received and may be accepted.
    (e) Bids may be withdrawn by written notice or telegram (including 
mailgram) received at any time before the exact time set for receipt of 
bids. If the solicitation authorizes facsimile bids, bids may be 
withdrawn via facsimile received at any time before the exact time set 
for receipt of bids, subject to the conditions specified in the 
provision entitled Facsimile Bids. A bid may be withdrawn in person by a 
bidder or its authorized representative if, before the exact time set 
for receipt of bids, the identity of the person requesting withdrawal is 
established and that person signs a receipt for the bid.
    (f) If an emergency or unanticipated event interrupts normal 
Government processes so as to cause postponement of the scheduled bid 
opening, and urgent Government requirements preclude amendment of the 
solicitation or other notice of an extension of the opening date, the 
time specified for receipt of bids will be deemed to be extended to the 
same time of day specified in the solicitation on the first work day on 
which normal Government processes resume.

                           (End of provision)

[54 FR 48992, Nov. 28, 1989, as amended at 60 FR 34740, July 3, 1995; 61 
FR 31620, June 20, 1996; 61 FR 69293, Dec. 31, 1996; 62 FR 12693, Mar. 
17, 1997]



Sec.  52.214-33  Late Submissions, Modifications, and Withdrawals of 
Technical Proposals Under Two-Step Sealed Bidding (Overseas).

    As prescribed in 14.201-6(v), insert the following provision:

Late Submissions, Modifications, and Withdrawals of Technical Proposals 
           Under Two-Step Sealed Bidding (Overseas) (MAY 1997)

    (a) Any technical proposal under step one of two-step sealed bidding 
received at the office designated in this solicitation after the exact 
time specified for receipt will not be considered unless it is received 
before the invitation for bids in step two is issued and it--
    (1) Was sent by mail (or telegram or facsimile, if authorized) or 
hand-carried (including delivery by a commercial carrier) if it is 
determined by the Government that the late receipt was due primarily to 
Government mishandling after receipt at the Government installation;
    (2) Was transmitted through an electronic commerce method authorized 
by the solicitation and was received at the initial point of entry to 
the Government infrastructure not later than 5:00 p.m. one working day 
prior to the date specified for receipt of technical proposals. The term 
working day excludes weekends and U.S. Federal holidays; or
    (3) Is the only technical proposal received.
    (b) Any modification of a technical proposal is subject to the same 
conditions as in paragraph (a) of this provision, except that (1) the 
use of a telegram (or mailgram) is authorized, and (2) if the 
solicitation authorizes facsimile bids, technical proposals may be 
modified via facsimile received at any time before the exact time set 
for receipt of bids under step two, subject to the conditions specified 
in the provision entitled Facsimile Bids.
    (c) Technical proposals may be withdrawn by written notice or 
telegram (including mailgram) received at any time before the exact time 
set for receipt of bids under step two. If the solicitation authorizes 
facsimile bids, technical proposals may be withdrawn via facsimile 
received at any time before the exact time set for receipt of bids under 
step two, subject to the conditions specified in the provision entitled 
Facsimile Bids. Technical proposals may be withdrawn in person by the 
submitter or the submitter's authorized representative if, before the 
exact time set for receipt of bids in step two, the identity of the 
person requesting withdrawal is established and that person signs a 
receipt for the technical proposal.
    (d) Acceptable evidence to establish the time of receipt at the 
Government installation includes the time/date stamp of that 
installation on the proposal wrapper, other documentary evidence of 
receipt maintained by the installation, or oral testimony or statements 
of Government personnel.
    (e) If an emergency or unanticipated event interrupts normal 
Government processes so that technical proposals cannot be received at 
the office designated for receipt of technical proposals by the exact 
time specified in the solicitation, and urgent Government requirements 
preclude amendment of the solicitation or other notice of an extension 
of the closing date, the time specified for receipt of technical 
proposals will be deemed to be extended to the same time of day 
specified in the solicitation on the first work day on which normal 
Government processes resume.

[[Page 72]]

If no time is specified in the solicitation, the time for receipt is 
4:30 p.m., local time, for the designated Government office.

                           (End of provision)

[54 FR 48992, Nov. 28, 1989, as amended at 60 FR 34740, July 3, 1995; 61 
FR 31620, June 20, 1996; 61 FR 69293, Dec. 31, 1996; 62 FR 12693, Mar. 
17, 1997]



Sec.  52.214-34  Submission of Offers in the English Language.

    As prescribed in 14.201-6(w), insert the following provision:

         Submission of Offers in the English Language (APR 1991)

    Offers submitted in response to this solicitation shall be in the 
English language. Offers received in other than English shall be 
rejected.

                           (End of provision)

[56 FR 15155, Apr. 15, 1991, as amended at 56 FR 33487, July 22, 1991; 
58 FR 31143, May 28, 1993; 62 FR 51271, Sept. 30, 1997; 64 FR 51841, 
Sept. 24, 1999; 64 FR 72433, Dec. 27, 1999]



Sec.  52.214-35  Submission of Offers in U.S. Currency.

    As prescribed in 14.201-6(x), insert the following provision:

            Submission of Offers in U.S. Currency (APR 1991)

    Offers submitted in response to this solicitation shall be in terms 
of U.S. dollars. Offers received in other than U.S. dollars shall be 
rejected.

                           (End of provision)

[56 FR 15155, Apr. 15, 1991, as amended at 58 FR 31143, May 28, 1993; 62 
FR 51271, Sept. 30, 1997; 64 FR 51841, Sept. 24, 1999; 64 FR 72433, Dec. 
27, 1999]



Sec.  52.215-1  Instructions to Offerors--Competitive Acquisition.

    As prescribed in 15.209(a), insert the following provision:

      Instructions to Offerors--Competitive Acquisitions (MAY 2001)

    (a) Definitions. As used in this provision--
    Discussions are negotiations that occur after establishment of the 
competitive range that may, at the Contracting Officer's discretion, 
result in the offeror being allowed to revise its proposal.
    In writing, writing, or written means any worded or numbered 
expression that can be read, reproduced, and later communicated, and 
includes electronically transmitted and stored information.
    Proposal modification is a change made to a proposal before the 
solicitation's closing date and time, or made in response to an 
amendment, or made to correct a mistake at any time before award.
    Proposal revision is a change to a proposal made after the 
solicitation closing date, at the request of or as allowed by a 
Contracting Officer as the result of negotiations.
    Time, if stated as a number of days, is calculated using calendar 
days, unless otherwise specified, and will include Saturdays, Sundays, 
and legal holidays. However, if the last day falls on a Saturday, 
Sunday, or legal holiday, then the period shall include the next working 
day.
    (b) Amendments to solicitations. If this solicitation is amended, 
all terms and conditions that are not amended remain unchanged. Offerors 
shall acknowledge receipt of any amendment to this solicitation by the 
date and time specified in the amendment(s).
    (c) Submission, modification, revision, and withdrawal of proposals. 
(1) Unless other methods (e.g., electronic commerce or facsimile) are 
permitted in the solicitation, proposals and modifications to proposals 
shall be submitted in paper media in sealed envelopes or packages (i) 
addressed to the office specified in the solicitation, and (ii) showing 
the time and date specified for receipt, the solicitation number, and 
the name and address of the offeror. Offerors using commercial carriers 
should ensure that the proposal is marked on the outermost wrapper with 
the information in paragraphs (c)(1)(i) and (c)(1)(ii) of this 
provision.
    (2) The first page of the proposal must show--
    (i) The solicitation number;
    (ii) The name, address, and telephone and facsimile numbers of the 
offeror (and electronic address if available);
    (iii) A statement specifying the extent of agreement with all terms, 
conditions, and provisions included in the solicitation and agreement to 
furnish any or all items upon which prices are offered at the price set 
opposite each item;
    (iv) Names, titles, and telephone and facsimile numbers (and 
electronic addresses if available) of persons authorized to negotiate on 
the offeror's behalf with the Government in connection with this 
solicitation; and
    (v) Name, title, and signature of person authorized to sign the 
proposal. Proposals signed by an agent shall be accompanied by evidence 
of that agent's authority, unless that evidence has been previously 
furnished to the issuing office.

[[Page 73]]

    (3) Submission, modification, revision, and withdrawal of proposals. 
(i) Offerors are responsible for submitting proposals, and any 
modifications or revisions, so as to reach the Government office 
designated in the solicitation by the time specified in the 
solicitation. If no time is specified in the solicitation, the time for 
receipt is 4:30 p.m., local time, for the designated Government office 
on the date that proposal or revision is due.
    (ii)(A) Any proposal, modification, or revision, received at the 
Government office designated in the solicitation after the exact time 
specified for receipt of offers is ``late'' and will not be considered 
unless it is received before award is made, the Contracting Officer 
determines that accepting the late offer would not unduly delay the 
acquisition; and--
    (1) If it was transmitted through an electronic commerce method 
authorized by the solicitation, it was received at the initial point of 
entry to the Government infrastructure not later than 5:00 p.m. one 
working day prior to the date specified for receipt of proposals; or
    (2) There is acceptable evidence to establish that it was received 
at the Government installation designated for receipt of offers and was 
under the Government's control prior to the time set for receipt of 
offers; or
    (3) It is the only proposal received.
    (B) However, a late modification of an otherwise successful proposal 
that makes its terms more favorable to the Government, will be 
considered at any time it is received and may be accepted.
    (iii) Acceptable evidence to establish the time of receipt at the 
Government installation includes the time/date stamp of that 
installation on the proposal wrapper, other documentary evidence of 
receipt maintained by the installation, or oral testimony or statements 
of Government personnel.
    (iv) If an emergency or unanticipated event interrupts normal 
Government processes so that proposals cannot be received at the office 
designated for receipt of proposals by the exact time specified in the 
solicitation, and urgent Government requirements preclude amendment of 
the solicitation, the time specified for receipt of proposals will be 
deemed to be extended to the same time of day specified in the 
solicitation on the first work day on which normal Government processes 
resume.
    (v) Proposals may be withdrawn by written notice received at any 
time before award. Oral proposals in response to oral solicitations may 
be withdrawn orally. If the solicitation authorizes facsimile proposals, 
proposals may be withdrawn via facsimile received at any time before 
award, subject to the conditions specified in the provision at 52.215-5, 
Facsimile Proposals. Proposals may be withdrawn in person by an offeror 
or an authorized representative, if the identity of the person 
requesting withdrawal is established and the person signs a receipt for 
the proposal before award.
    (4) Unless otherwise specified in the solicitation, the offeror may 
propose to provide any item or combination of items.
    (5) Offerors shall submit proposals in response to this solicitation 
in English, unless otherwise permitted by the solicitation, and in U.S. 
dollars, unless the provision at FAR 52.225-17, Evaluation of Foreign 
Currency Offers, is included in the solicitation.
    (6) Offerors may submit modifications to their proposals at any time 
before the solicitation closing date and time, and may submit 
modifications in response to an amendment, or to correct a mistake at 
any time before award.
    (7) Offerors may submit revised proposals only if requested or 
allowed by the Contracting Officer.
    (8) Proposals may be withdrawn at any time before award. Withdrawals 
are effective upon receipt of notice by the Contracting Officer.
    (d) Offer expiration date. Proposals in response to this 
solicitation will be valid for the number of days specified on the 
solicitation cover sheet (unless a different period is proposed by the 
offeror).
    (e) Restriction on disclosure and use of data. Offerors that include 
in their proposals data that they do not want disclosed to the public 
for any purpose, or used by the Government except for evaluation 
purposes, shall--
    (1) Mark the title page with the following legend: This proposal 
includes data that shall not be disclosed outside the Government and 
shall not be duplicated, used, or disclosed--in whole or in part--for 
any purpose other than to evaluate this proposal. If, however, a 
contract is awarded to this offeror as a result of--or in connection 
with-- the submission of this data, the Government shall have the right 
to duplicate, use, or disclose the data to the extent provided in the 
resulting contract. This restriction does not limit the Government's 
right to use information contained in this data if it is obtained from 
another source without restriction. The data subject to this restriction 
are contained in sheets [insert numbers or other identification of 
sheets]; and
    (2) Mark each sheet of data it wishes to restrict with the following 
legend: Use or disclosure of data contained on this sheet is subject to 
the restriction on the title page of this proposal.
    (f) Contract award. (1) The Government intends to award a contract 
or contracts resulting from this solicitation to the responsible 
offeror(s) whose proposal(s) represents the best value after evaluation 
in accordance with the factors and subfactors in the solicitation.

[[Page 74]]

    (2) The Government may reject any or all proposals if such action is 
in the Government's interest.
    (3) The Government may waive informalities and minor irregularities 
in proposals received.
    (4) The Government intends to evaluate proposals and award a 
contract without discussions with offerors (except clarifications as 
described in FAR 15.306(a)). Therefore, the offeror's initial proposal 
should contain the offeror's best terms from a cost or price and 
technical standpoint. The Government reserves the right to conduct 
discussions if the Contracting Officer later determines them to be 
necessary. If the Contracting Officer determines that the number of 
proposals that would otherwise be in the competitive range exceeds the 
number at which an efficient competition can be conducted, the 
Contracting Officer may limit the number of proposals in the competitive 
range to the greatest number that will permit an efficient competition 
among the most highly rated proposals.
    (5) The Government reserves the right to make an award on any item 
for a quantity less than the quantity offered, at the unit cost or 
prices offered, unless the offeror specifies otherwise in the proposal.
    (6) The Government reserves the right to make multiple awards if, 
after considering the additional administrative costs, it is in the 
Government's best interest to do so.
    (7) Exchanges with offerors after receipt of a proposal do not 
constitute a rejection or counteroffer by the Government.
    (8) The Government may determine that a proposal is unacceptable if 
the prices proposed are materially unbalanced between line items or 
subline items. Unbalanced pricing exists when, despite an acceptable 
total evaluated price, the price of one or more contract line items is 
significantly overstated or understated as indicated by the application 
of cost or price analysis techniques. A proposal may be rejected if the 
Contracting Officer determines that the lack of balance poses an 
unacceptable risk to the Government.
    (9) If a cost realism analysis is performed, cost realism may be 
considered by the source selection authority in evaluating performance 
or schedule risk.
    (10) A written award or acceptance of proposal mailed or otherwise 
furnished to the successful offeror within the time specified in the 
proposal shall result in a binding contract without further action by 
either party.
    (11) The Government may disclose the following information in 
postaward debriefings to other offerors:
    (i) The overall evaluated cost or price and technical rating of the 
successful offeror;
    (ii) The overall ranking of all offerors, when any ranking was 
developed by the agency during source selection;
    (iii) A summary of the rationale for award; and
    (iv) For acquisitions of commercial items, the make and model of the 
item to be delivered by the successful offeror.

                           (End of provision)

    Alternate I (Oct 1997). As prescribed in 15.209(a)(1), substitute 
the following paragraph (f)(4) for paragraph (f)(4) of the basic 
provision:

    (f)(4) The Government intends to evaluate proposals and award a 
contract after conducting discussions with offerors whose proposals have 
been determined to be within the competitive range. If the Contracting 
Officer determines that the number of proposals that would otherwise be 
in the competitive range exceeds the number at which an efficient 
competition can be conducted, the Contracting Officer may limit the 
number of proposals in the competitive range to the greatest number that 
will permit an efficient competition among the most highly rated 
proposals. Therefore, the offeror's initial proposal should contain the 
offeror's best terms from a price and technical standpoint.

    Alternate II (Oct 1997). As prescribed in 15.209(a)(2), add a 
paragraph (c)(9) substantially the same as the following to the basic 
clause:

    (9) Offerors may submit proposals that depart from stated 
requirements. Such proposals shall clearly identify why the acceptance 
of the proposal would be advantageous to the Government. Any deviations 
from the terms and conditions of the solicitation, as well as the 
comparative advantage to the Government, shall be clearly identified and 
explicitly defined. The Government reserves the right to amend the 
solicitation to allow all offerors an opportunity to submit revised 
proposals based on the revised requirements.

[62 FR 51259, Sept. 30, 1997; 64 FR 51841, Sept. 24, 1999, as amended at 
64 FR 72433, 72451, Dec. 27, 1999; 66 FR 2135, Jan. 10, 2001]



Sec.  52.215-2  Audit and Records--Negotiation.

    As prescribed in 15.209(b), insert the following clause:

                Audit and Records--Negotiation (JUN 1999)

    (a) As used in this clause, records includes books, documents, 
accounting procedures and practices, and other data, regardless of type 
and regardless of whether such items are in written form, in the form of 
computer data, or in any other form.
    (b) Examination of costs. If this is a cost-reimbursement, 
incentive, time-and-materials, labor-hour, or price redeterminable 
contract,

[[Page 75]]

or any combination of these, the Contractor shall maintain and the 
Contracting Officer, or an authorized representative of the Contracting 
Officer, shall have the right to examine and audit all records and other 
evidence sufficient to reflect properly all costs claimed to have been 
incurred or anticipated to be incurred directly or indirectly in 
performance of this contract. This right of examination shall include 
inspection at all reasonable times of the Contractor's plants, or parts 
of them, engaged in performing the contract.
    (c) Cost or pricing data. If the Contractor has been required to 
submit cost or pricing data in connection with any pricing action 
relating to this contract, the Contracting Officer, or an authorized 
representative of the Contracting Officer, in order to evaluate the 
accuracy, completeness, and currency of the cost or pricing data, shall 
have the right to examine and audit all of the Contractor's records, 
including computations and projections, related to--
    (1) The proposal for the contract, subcontract, or modification;
    (2) The discussions conducted on the proposal(s), including those 
related to negotiating;
    (3) Pricing of the contract, subcontract, or modification; or
    (4) Performance of the contract, subcontract or modification.
    (d) Comptroller General. (1) The Comptroller General of the United 
States, or an authorized representative, shall have access to and the 
right to examine any of the Contractor's directly pertinent records 
involving transactions related to this contract or a subcontract 
hereunder.
    (2) This paragraph may not be construed to require the Contractor or 
subcontractor to create or maintain any record that the Contractor or 
subcontractor does not maintain in the ordinary course of business or 
pursuant to a provision of law.
    (e) Reports. If the Contractor is required to furnish cost, funding, 
or performance reports, the Contracting Officer or an authorized 
representative of the Contracting Officer shall have the right to 
examine and audit the supporting records and materials, for the purpose 
of evaluating (1) the effectiveness of the Contractor's policies and 
procedures to produce data compatible with the objectives of these 
reports and (2) the data reported.
    (f) Availability. The Contractor shall make available at its office 
at all reasonable times the records, materials, and other evidence 
described in paragraphs (a), (b), (c), (d), and (e) of this clause, for 
examination, audit, or reproduction, until 3 years after final payment 
under this contract or for any shorter period specified in Subpart 4.7, 
Contractor Records Retention, of the Federal Acquisition Regulation 
(FAR), or for any longer period required by statute or by other clauses 
of this contract. In addition--
    (1) If this contract is completely or partially terminated, the 
Contractor shall make available the records relating to the work 
terminated until 3 years after any resulting final termination 
settlement; and
    (2) The Contractor shall make available records relating to appeals 
under the Disputes clause or to litigation or the settlement of claims 
arising under or relating to this contract until such appeals, 
litigation, or claims are finally resolved.
    (g) The Contractor shall insert a clause containing all the terms of 
this clause, including this paragraph (a), in all subcontracts under 
this contract that exceed the simplified acquisition threshold and--
    (1) That are cost-reimbursement, incentive, time-and-materials, 
labor-hour, or price-redeterminable type or any combination of these;
    (2) For which cost or pricing data are required; or
    (3) That require the subcontractor to furnish reports as discussed 
in paragraph (e) of this clause.
    The clause may be altered only as necessary to identify properly the 
contracting parties and the Contracting Officer under the Government 
prime contract.

                             (End of clause)

    Alternate I (JAN 1997). As prescribed in 15.209(b)(2), in facilities 
contracts, add the following sentence at the end of paragraph (b) of the 
basic clause:

    The obligations and rights specified in this paragraph shall extend 
to the use of, and charges for the use of, the facilities under this 
contract.

    Alternate II (APR 1998). As prescribed in 15.209(b)(3), add the 
following paragraph (h) to the basic clause:

    (h) The provisions of OMB Circular No. A-133, ``Audits of States, 
Local Governments, and Nonprofit Organizations,'' apply to this 
contract.

    Alternate III (June 1999). As prescribed in 15.209(b)(4), delete 
paragraph (d) of the basic clause and redesignate the remaining 
paragraphs accordingly, and substitute the following paragraph (e) for 
the redesignated paragraph (e) of the basic clause:

    (e) Availability. The Contractor shall make available at its office 
at all reasonable times the records, materials, and other evidence 
described in paragraphs (a), (b), (c), and (d) of this clause, for 
examination, audit, or reproduction, until 3 years after final payment 
under this contract or for any shorter period

[[Page 76]]

specified in Subpart 4.7, Contractor Records Retention, of the Federal 
Acquisition Regulation (FAR), or for any longer period required by 
statute or by other clauses of this contract. In addition--
    (1) If this contract is completely or partially terminated, the 
Contractor shall make available the records relating to the work 
terminated until 3 years after any resulting final termination 
settlement; and
    (2) The Contractor shall make available records relating to appeals 
under the Disputes clause or to litigation or the settlement of claims 
arising under or relating to this contract until such appeals, 
litigation, or claims are finally resolved.

[60 FR 42651, Aug. 16, 1995, as amended at 61 FR 39198, July 26, 1996; 
62 FR 259, Jan. 2, 1997; 62 FR 51271, Sept. 30, 1997; 63 FR 9055, Feb. 
23, 1998; 64 FR 32749, June 17, 1999]



Sec.  52.215-3  Request for Information or Solicitation for Planning Purposes.

    As prescribed in 15.209(c), insert the following provision:

Request for Information or Solicitation for Planning Purposes (OCT 1997)

    (a) The Government does not intend to award a contract on the basis 
of this solicitation or to otherwise pay for the information solicited 
except as an allowable cost under other contracts as provided in 
subsection 31.205-18, Bid and proposal costs, of the Federal Acquisition 
Regulation.
    (b) Although ``proposal'' and ``offeror'' are used in this Request 
for Information, your response will be treated as information only. It 
shall not be used as a proposal.
    (c) This solicitation is issued for the purpose of: [state purpose].

                           (End of provision)

[62 FR 51261, Sept. 30, 1997]



Sec.  52.215-4  [Reserved]



Sec.  52.215-5  Facsimile Proposals.

    As prescribed in 15.209(e), insert the following provision:

                     Facsimile Proposals (OCT 1997)

    (a) Definition. Facsimile proposal, as used in this provision, means 
a proposal, revision or modification of a proposal, or withdrawal of a 
proposal that is transmitted to and received by the Government via 
facsimile machine.
    (b) Offerors may submit facsimile proposals as responses to this 
solicitation. Facsimile proposals are subject to the same rules as paper 
proposals.
    (c) The telephone number of receiving facsimile equipment is: 
[insert telephone number].
    (d) If any portion of a facsimile proposal received by the 
Contracting Officer is unreadable to the degree that conformance to the 
essential requirements of the solicitation cannot be ascertained from 
the document--
    (1) The Contracting Officer immediately shall notify the offeror and 
permit the offeror to resubmit the proposal;
    (2) The method and time for resubmission shall be prescribed by the 
Contracting Officer after consultation with the offeror; and
    (3) The resubmission shall be considered as if it were received at 
the date and time of the original unreadable submission for the purpose 
of determining timeliness, provided the offeror complies with the time 
and format requirements for resubmission prescribed by the Contracting 
Officer.
    (e) The Government reserves the right to make award solely on the 
facsimile proposal. However, if requested to do so by the Contracting 
Officer, the apparently successful offeror promptly shall submit the 
complete original signed proposal.

                           (End of provision)

[62 FR 51261, Sept. 30, 1997]



Sec.  52.215-6  Place of Performance.

    As prescribed in 15.209(f), insert the following provision:

                     Place of Performance (OCT 1997)

    (a) The offeror or respondent, in the performance of any contract 
resulting from this solicitation, [squ] intends, [squ] does not intend 
[check applicable block] to use one or more plants or facilities located 
at a different address from the address of the offeror or respondent as 
indicated in this proposal or response to request for information.
    (b) If the offeror or respondent checks ``intends'' in paragraph (a) 
of this provision, it shall insert in the following spaces the required 
information:

------------------------------------------------------------------------
    Place of performance (street        Name and address of owner and
 address, city, state, county, zip    operator of the plant or facility
               code)                 if other than offeror or respondent
------------------------------------------------------------------------
 
 
------------------------------------------------------------------------

                           (End of provision)

[62 FR 51261, Sept. 30, 1997]

[[Page 77]]



Sec.  52.215-7  Annual Representations and Certifications--Negotiation.

    As prescribed in 15.209(g), insert the following provision:

    Annual Representations and Certifications--Negotiation (OCT 1997)

    The offeror has [check the appropriate block]:
    [squ] (a) Submitted to the contracting office issuing this 
solicitation, annual representations and certifications dated ------ 
[insert date of signature on submission] that are incorporated herein by 
reference, and are current, accurate, and complete as of the date of 
this proposal, except as follows [insert changes that affect only this 
proposal; if ``none,'' so state]:
    [squ] (b) Enclosed its annual representations and certifications.

                           (End of provision)

[62 FR 51261, Sept. 30, 1997]



Sec.  52.215-8  Order of Precedence--Uniform Contract Format.

    As prescribed in 15.209(h), insert the following clause:

         Order of Precedence--Uniform Contract Format (OCT 1997)

    Any inconsistency in this solicitation or contract shall be resolved 
by giving precedence in the following order:
    (a) The Schedule (excluding the specifications).
    (b) Representations and other instructions.
    (c) Contract clauses.
    (d) Other documents, exhibits, and attachments.
    (e) The specifications.

                             (End of clause)

[62 FR 51261, Sept. 30, 1997]



Sec.  52.215-9  Changes or Additions to Make-or-Buy Program.

    As prescribed in 15.408(a), insert the following clause:

         Changes or Additions to Make-or-Buy Program (OCT 1997)

    (a) The Contractor shall perform in accordance with the make-or-buy 
program incorporated in this contract. If the Contractor proposes to 
change the program, the Contractor shall, reasonably in advance of the 
proposed change, (1) notify the Contracting Officer in writing, and (2) 
submit justification in sufficient detail to permit evaluation. Changes 
in the place of performance of any ``make'' items in the program are 
subject to this requirement.
    (b) For items deferred at the time of negotiation of this contract 
for later addition to the program, the Contractor shall, at the earliest 
possible time--
    (1) Notify the Contracting Officer of each proposed addition; and
    (2) Provide justification in sufficient detail to permit evaluation.
    (c) Modification of the make-or-buy program to incorporate proposed 
changes or additions shall be effective upon the Contractor's receipt of 
the Contracting Officer's written approval.

                             (End of clause)

    Alternate I (Oct 1997). As prescribed in 15.408(a)(1) add the 
following paragraph (d) to the basic clause:

    (d) If the Contractor desires to reverse the categorization of 
``make'' or ``buy'' for any item or items designated in the contract as 
subject to this paragraph, it shall--
    (1) Support its proposal with cost or pricing data when permitted 
and necessary to support evaluation; and
    (2) After approval is granted, promptly negotiate with the 
Contracting Officer an equitable reduction in the contract price in 
accordance with paragraph (k) of the Incentive Price Revision--Firm 
Target clause or paragraph (m) of the Incentive Price Revision--
Successive Targets clause of this contract.

    Alternate II (Oct 1997). As prescribed in 15.408(a)(2), add the 
following paragraph (d) to the basic clause:

    (d) If the Contractor desires to reverse the categorization of 
``make'' or ``buy'' for any item or items designated in the contract as 
subject to this paragraph, it shall--
    (1) Support its proposal with cost or pricing data to permit 
evaluation; and
    (2) After approval is granted, promptly negotiate with the 
Contracting Officer an equitable reduction in the contract's total 
estimated cost and fee in accordance with paragraph (e) of the Incentive 
Fee clause of this contract.

[62 FR 51261, Sept. 30, 1997]



Sec.  52.215-10  Price Reduction for Defective Cost or Pricing Data.

    As prescribed in 15.408(b), insert the following clause:

      Price Reduction for Defective Cost or Pricing Data (OCT 1997)

    (a) If any price, including profit or fee, negotiated in connection 
with this contract, or any cost reimbursable under this contract,

[[Page 78]]

was increased by any significant amount because--
    (1) The Contractor or a subcontractor furnished cost or pricing data 
that were not complete, accurate, and current as certified in its 
Certificate of Current Cost or Pricing Data;
    (2) A subcontractor or prospective subcontractor furnished the 
Contractor cost or pricing data that were not complete, accurate, and 
current as certified in the Contractor's Certificate of Current Cost or 
Pricing Data; or
    (3) Any of these parties furnished data of any description that were 
not accurate, the price or cost shall be reduced accordingly and the 
contract shall be modified to reflect the reduction.
    (b) Any reduction in the contract price under paragraph (a) of this 
clause due to defective data from a prospective subcontractor that was 
not subsequently awarded the subcontract shall be limited to the amount, 
plus applicable overhead and profit markup, by which--
    (1) The actual subcontract; or
    (2) The actual cost to the Contractor, if there was no subcontract, 
was less than the prospective subcontract cost estimate submitted by the 
Contractor; provided, that the actual subcontract price was not itself 
affected by defective cost or pricing data.
    (c)(1) If the Contracting Officer determines under paragraph (a) of 
this clause that a price or cost reduction should be made, the 
Contractor agrees not to raise the following matters as a defense:
    (i) The Contractor or subcontractor was a sole source supplier or 
otherwise was in a superior bargaining position and thus the price of 
the contract would not have been modified even if accurate, complete, 
and current cost or pricing data had been submitted.
    (ii) The Contracting Officer should have known that the cost or 
pricing data in issue were defective even though the Contractor or 
subcontractor took no affirmative action to bring the character of the 
data to the attention of the Contracting Officer.
    (iii) The contract was based on an agreement about the total cost of 
the contract and there was no agreement about the cost of each item 
procured under the contract.
    (iv) The Contractor or subcontractor did not submit a Certificate of 
Current Cost or Pricing Data.
    (2)(i) Except as prohibited by subdivision (c)(2)(ii) of this 
clause, an offset in an amount determined appropriate by the Contracting 
Officer based upon the facts shall be allowed against the amount of a 
contract price reduction if--
    (A) The Contractor certifies to the Contracting Officer that, to the 
best of the Contractor's knowledge and belief, the Contractor is 
entitled to the offset in the amount requested; and
    (B) The Contractor proves that the cost or pricing data were 
available before the ``as of'' date specified on its Certificate of 
Current Cost or Pricing Data, and that the data were not submitted 
before such date.
    (ii) An offset shall not be allowed if--
    (A) The understated data were known by the Contractor to be 
understated before the ``as of'' date specified on its Certificate of 
Current Cost or Pricing Data; or
    (B) The Government proves that the facts demonstrate that the 
contract price would not have increased in the amount to be offset even 
if the available data had been submitted before the ``as of'' date 
specified on its Certificate of Current Cost or Pricing Data.
    (d) If any reduction in the contract price under this clause reduces 
the price of items for which payment was made prior to the date of the 
modification reflecting the price reduction, the Contractor shall be 
liable to and shall pay the United States at the time such overpayment 
is repaid--
    (1) Simple interest on the amount of such overpayment to be computed 
from the date(s) of overpayment to the Contractor to the date the 
Government is repaid by the Contractor at the applicable underpayment 
rate effective for each quarter prescribed by the Secretary of the 
Treasury under 26 U.S.C. 6621(a)(2); and
    (2) A penalty equal to the amount of the overpayment, if the 
Contractor or subcontractor knowingly submitted cost or pricing data 
that were incomplete, inaccurate, or noncurrent.

                             (End of clause)

[62 FR 51262, Sept. 30, 1997]



Sec.  52.215-11  Price Reduction for Defective Cost or Pricing Data--Modifications.

    As prescribed in 15.408(c), insert the following clause:

 Price Reduction for Defective Cost or Pricing Data--Modifications (OCT 
                                  1997)

    (a) This clause shall become operative only for any modification to 
this contract involving a pricing adjustment expected to exceed the 
threshold for submission of cost or pricing data at FAR 15.403-4, except 
that this clause does not apply to any modification if an exception 
under FAR 15.403-1 applies.
    (b) If any price, including profit or fee, negotiated in connection 
with any modification under this clause, or any cost reimbursable under 
this contract, was increased by any significant amount because (1) the 
Contractor or a subcontractor furnished cost or pricing data that were 
not complete, accurate, and current as certified in its Certificate of 
Current Cost or Pricing Data, (2) a

[[Page 79]]

subcontractor or prospective subcontractor furnished the Contractor cost 
or pricing data that were not complete, accurate, and current as 
certified in the Contractor's Certificate of Current Cost or Pricing 
Data, or (3) any of these parties furnished data of any description that 
were not accurate, the price or cost shall be reduced accordingly and 
the contract shall be modified to reflect the reduction. This right to a 
price reduction is limited to that resulting from defects in data 
relating to modifications for which this clause becomes operative under 
paragraph (a) of this clause.
    (c) Any reduction in the contract price under paragraph (b) of this 
clause due to defective data from a prospective subcontractor that was 
not subsequently awarded the subcontract shall be limited to the amount, 
plus applicable overhead and profit markup, by which--
    (1) The actual subcontract; or
    (2) The actual cost to the Contractor, if there was no subcontract, 
was less than the prospective subcontract cost estimate submitted by the 
Contractor; provided, that the actual subcontract price was not itself 
affected by defective cost or pricing data.
    (d)(1) If the Contracting Officer determines under paragraph (b) of 
this clause that a price or cost reduction should be made, the 
Contractor agrees not to raise the following matters as a defense:
    (i) The Contractor or subcontractor was a sole source supplier or 
otherwise was in a superior bargaining position and thus the price of 
the contract would not have been modified even if accurate, complete, 
and current cost or pricing data had been submitted.
    (ii) The Contracting Officer should have known that the cost or 
pricing data in issue were defective even though the Contractor or 
subcontractor took no affirmative action to bring the character of the 
data to the attention of the Contracting Officer.
    (iii) The contract was based on an agreement about the total cost of 
the contract and there was no agreement about the cost of each item 
procured under the contract.
    (iv) The Contractor or subcontractor did not submit a Certificate of 
Current Cost or Pricing Data.
    (2)(i) Except as prohibited by subdivision (d)(2)(ii) of this 
clause, an offset in an amount determined appropriate by the Contracting 
Officer based upon the facts shall be allowed against the amount of a 
contract price reduction if--
    (A) The Contractor certifies to the Contracting Officer that, to the 
best of the Contractor's knowledge and belief, the Contractor is 
entitled to the offset in the amount requested; and
    (B) The Contractor proves that the cost or pricing data were 
available before the ``as of'' date specified on its Certificate of 
Current Cost or Pricing Data, and that the data were not submitted 
before such date.
    (ii) An offset shall not be allowed if--
    (A) The understated data were known by the Contractor to be 
understated before the ``as of'' date specified on its Certificate of 
Current Cost or Pricing Data; or
    (B) The Government proves that the facts demonstrate that the 
contract price would not have increased in the amount to be offset even 
if the available data had been submitted before the ``as of'' date 
specified on its Certificate of Current Cost or Pricing Data.
    (e) If any reduction in the contract price under this clause reduces 
the price of items for which payment was made prior to the date of the 
modification reflecting the price reduction, the Contractor shall be 
liable to and shall pay the United States at the time such overpayment 
is repaid--
    (1) Simple interest on the amount of such overpayment to be computed 
from the date(s) of overpayment to the Contractor to the date the 
Government is repaid by the Contractor at the applicable underpayment 
rate effective for each quarter prescribed by the Secretary of the 
Treasury under 26 U.S.C. 6621(a)(2); and
    (2) A penalty equal to the amount of the overpayment, if the 
Contractor or subcontractor knowingly submitted cost or pricing data 
that were incomplete, inaccurate, or noncurrent.

                             (End of clause)

[62 FR 51262, Sept. 30, 1997]



Sec.  52.215-12  Subcontractor Cost or Pricing Data.

    As prescribed in 15.408(d), insert the following clause:

              Subcontractor Cost or Pricing Data (OCT 1997)

    (a) Before awarding any subcontract expected to exceed the threshold 
for submission of cost or pricing data at FAR 15.403-4, on the date of 
agreement on price or the date of award, whichever is later; or before 
pricing any subcontract modification involving a pricing adjustment 
expected to exceed the threshold for submission of cost or pricing data 
at FAR 15.403-4, the Contractor shall require the subcontractor to 
submit cost or pricing data (actually or by specific identification in 
writing), unless an exception under FAR 15.403-1 applies.
    (b) The Contractor shall require the subcontractor to certify in 
substantially the form prescribed in FAR 15.406-2 that, to the best of 
its knowledge and belief, the data submitted under paragraph (a) of this 
clause were accurate, complete, and current as of the date of agreement 
on the negotiated

[[Page 80]]

price of the subcontract or subcontract modification.
    (c) In each subcontract that exceeds the threshold for submission of 
cost or pricing data at FAR 15.403-4, when entered into, the Contractor 
shall insert either--
    (1) The substance of this clause, including this paragraph (c), if 
paragraph (a) of this clause requires submission of cost or pricing data 
for the subcontract; or
    (2) The substance of the clause at FAR 52.215-13, Subcontractor Cost 
or Pricing Data--Modifications.

                             (End of clause)

[62 FR 51263, Sept. 30, 1997]



Sec.  52.215-13  Subcontractor Cost or Pricing Data--Modifications.

    As prescribed in 15.408(e), insert the following clause:

      Subcontractor Cost or Pricing Data--Modifications (OCT 1997)

    (a) The requirements of paragraphs (b) and (c) of this clause 
shall--
    (1) Become operative only for any modification to this contract 
involving a pricing adjustment expected to exceed the threshold for 
submission of cost or pricing data at FAR 15.403-4; and
    (2) Be limited to such modifications.
    (b) Before awarding any subcontract expected to exceed the threshold 
for submission of cost or pricing data at FAR 15.403-4, on the date of 
agreement on price or the date of award, whichever is later; or before 
pricing any subcontract modification involving a pricing adjustment 
expected to exceed the threshold for submission of cost or pricing data 
at FAR 15.403-4, the Contractor shall require the subcontractor to 
submit cost or pricing data (actually or by specific identification in 
writing), unless an exception under FAR 15.403-1 applies.
    (c) The Contractor shall require the subcontractor to certify in 
substantially the form prescribed in FAR 15.406-2 that, to the best of 
its knowledge and belief, the data submitted under paragraph (b) of this 
clause were accurate, complete, and current as of the date of agreement 
on the negotiated price of the subcontract or subcontract modification.
    (d) The Contractor shall insert the substance of this clause, 
including this paragraph (d), in each subcontract that exceeds the 
threshold for submission of cost or pricing data at FAR 15.403-4 on the 
date of agreement on price or the date of award, whichever is later.

                             (End of clause)

[62 FR 51263, Sept. 30, 1997]



Sec.  52.215-14  Integrity of Unit Prices.

    As prescribed in 15.408(f)(1), insert the following clause:

                   Integrity of Unit Prices (OCT 1997)

    (a) Any proposal submitted for the negotiation of prices for items 
of supplies shall distribute costs within contracts on a basis that 
ensures that unit prices are in proportion to the items' base cost 
(e.g., manufacturing or acquisition costs). Any method of distributing 
costs to line items that distorts unit prices shall not be used. For 
example, distributing costs equally among line items is not acceptable 
except when there is little or no variation in base cost. Nothing in 
this paragraph requires submission of cost or pricing data not otherwise 
required by law or regulation.
    (b) When requested by the Contracting Officer, the Offeror/
Contractor shall also identify those supplies that it will not 
manufacture or to which it will not contribute significant value.
    (c) The Contractor shall insert the substance of this clause, less 
paragraph (b), in all subcontracts for other than: acquisitions at or 
below the simplified acquisition threshold in FAR Part 2; construction 
or architect-engineer services under FAR Part 36; utility services under 
FAR Part 41; services where supplies are not required; commercial items; 
and petroleum products.

                             (End of clause)

    Alternate I (Oct 1997). As prescribed in 15.408(f)(2), substitute 
the following paragraph (b) for paragraph (b) of the basic clause:

    (b) The Offeror/Contractor shall also identify those supplies that 
it will not manufacture or to which it will not contribute significant 
value.

[62 FR 51263, Sept. 30, 1997]



Sec.  52.215-15  Pension adjustments and asset reversions.

    As prescribed in 15.408(g), insert the following clause:

           Pension Adjustments and Asset Reversions (DEC 1998)

    (a) The Contractor shall promptly notify the Contracting Officer in 
writing when it determines that it will terminate a defined-benefit 
pension plan or otherwise recapture such pension fund assets.

[[Page 81]]

    (b) For segment closings, pension plan terminations, or curtailment 
of benefits, the adjustment amount shall be the amount measured, 
assigned, and allocated in accordance with 48 CFR 9904.413-50(c)(12) for 
contracts and subcontracts that are subject to Cost Accounting Standards 
(CAS) Board rules and regulations (48 CFR Chapter 99). For contracts and 
subcontracts that are not subject to CAS, the adjustment amount shall be 
the amount measured, assigned, and allocated in accordance with 48 CFR 
9904.413-50(c)(12), except the numerator of the fraction at 48 CFR 
9904.413-50(c)(12)(vi) shall be the sum of the pension plan costs 
allocated to all non-CAS-covered contracts and subcontracts that are 
subject to Federal Acquisition Regulation (FAR) Subpart 31.2 or for 
which cost or pricing data were submitted.
    (c) For all other situations where assets revert to the Contractor, 
or such assets are constructively received by it for any reason, the 
Contractor shall, at the Government's option, make a refund or give a 
credit to the Government for its equitable share of the gross amount 
withdrawn. The Government's equitable share shall reflect the 
Government's participation in pension costs through those contracts for 
which cost or pricing data were submitted or that are subject to FAR 
Subpart 31.2.
    (d) The Contractor shall include the substance of this clause in all 
subcontracts under this contract that meet the applicability requirement 
of FAR 15.408(g).

                             (End of clause)

[63 FR 58598, Oct. 30, 1998]



Sec.  52.215-16  Facilities Capital Cost of Money.

    As prescribed in 15.408(h), insert the following provision:

              Facilities Capital Cost of Money (June 2003)

    (a) Facilities capital cost of money will be an allowable cost under 
the contemplated contract, if the criteria for allowability in FAR 
31.205-10(b) are met. One of the allowability criteria requires the 
prospective Contractor to propose facilities capital cost of money in 
its offer.
    (b) If the prospective Contractor does not propose this cost, the 
resulting contract will include the clause Waiver of Facilities Capital 
Cost of Money.

                           (End of provision)

[52 FR 35669, Sept. 22, 1987. Redesignated and amended at 62 FR 51263, 
Sept. 30, 1997; 68 FR 28092, May 22, 2003]



Sec.  52.215-17  Waiver of Facilities Capital Cost of Money.

    As prescribed in 15.408(i), insert the following clause:

          Waiver of Facilities Capital Cost of Money (OCT 1997)

    The Contractor did not include facilities capital cost of money as a 
proposed cost of this contract. Therefore, it is an unallowable cost 
under this contract.

                             (End of clause)

[52 FR 35669, Sept. 22, 1987. Redesignated and amended at 62 FR 51263, 
Sept. 30, 1997]



Sec.  52.215-18  Reversion or Adjustment of Plans for Postretirement 
Benefits (PRB) Other Than Pensions.

    As prescribed in 15.408(j), insert the following clause:

Reversion or Adjustment of Plans for Postretirement Benefits (PRB) Other 
                        Than Pensions (OCT 1997)

    The Contractor shall promptly notify the Contracting Officer in 
writing when it determines that it will terminate or reduce a PRB plan. 
If PRB fund assets revert, or inure, to the Contractor or are 
constructively received by it under a plan termination or otherwise, the 
Contractor shall make a refund or give a credit to the Government for 
its equitable share as required by FAR 31.205-6(o)(6). The Contractor 
shall include the substance of this clause in all subcontracts under 
this contract that meet the applicability requirements of FAR 15.408(j).

                             (End of clause)

[62 FR 51263, Sept. 30, 1997]



Sec.  52.215-19  Notification of Ownership Changes.

    As prescribed in 15.408(k), insert the following clause:

              Notification of Ownership Changes (OCT 1997)

    (a) The Contractor shall make the following notifications in 
writing:
    (1) When the Contractor becomes aware that a change in its ownership 
has occurred, or is certain to occur, that could result in changes in 
the valuation of its capitalized assets in the accounting records, the 
Contractor shall notify the Administrative Contracting Officer (ACO) 
within 30 days.
    (2) The Contractor shall also notify the ACO within 30 days whenever 
changes to asset valuations or any other cost changes

[[Page 82]]

have occurred or are certain to occur as a result of a change in 
ownership.
    (b) The Contractor shall--
    (1) Maintain current, accurate, and complete inventory records of 
assets and their costs;
    (2) Provide the ACO or designated representative ready access to the 
records upon request;
    (3) Ensure that all individual and grouped assets, their capitalized 
values, accumulated depreciation or amortization, and remaining useful 
lives are identified accurately before and after each of the 
Contractor's ownership changes; and
    (4) Retain and continue to maintain depreciation and amortization 
schedules based on the asset records maintained before each Contractor 
ownership change.
    (c) The Contractor shall include the substance of this clause in all 
subcontracts under this contract that meet the applicability requirement 
of FAR 15.408(k).

                             (End of clause)

[62 FR 51264, Sept. 30, 1997]



Sec.  52.215-20  Requirements for Cost or Pricing Data or Information Other 
Than Cost or Pricing Data.

    As prescribed in 15.408(l), insert the following provision:

Requirements for Cost or Pricing Data or Information Other Than Cost or 
                         Pricing Data (OCT 1997)

    (a) Exceptions from cost or pricing data. (1) In lieu of submitting 
cost or pricing data, offerors may submit a written request for 
exception by submitting the information described in the following 
subparagraphs. The Contracting Officer may require additional supporting 
information, but only to the extent necessary to determine whether an 
exception should be granted, and whether the price is fair and 
reasonable.
    (i) Identification of the law or regulation establishing the price 
offered. If the price is controlled under law by periodic rulings, 
reviews, or similar actions of a governmental body, attach a copy of the 
controlling document, unless it was previously submitted to the 
contracting office.
    (ii) Commercial item exception. For a commercial item exception, the 
offeror shall submit, at a minimum, information on prices at which the 
same item or similar items have previously been sold in the commercial 
market that is adequate for evaluating the reasonableness of the price 
for this acquisition. Such information may include--
    (A) For catalog items, a copy of or identification of the catalog 
and its date, or the appropriate pages for the offered items, or a 
statement that the catalog is on file in the buying office to which the 
proposal is being submitted. Provide a copy or describe current discount 
policies and price lists (published or unpublished), e.g., wholesale, 
original equipment manufacturer, or reseller. Also explain the basis of 
each offered price and its relationship to the established catalog 
price, including how the proposed price relates to the price of recent 
sales in quantities similar to the proposed quantities;
    (B) For market-priced items, the source and date or period of the 
market quotation or other basis for market price, the base amount, and 
applicable discounts. In addition, describe the nature of the market;
    (C) For items included on an active Federal Supply Service Multiple 
Award Schedule contract, proof that an exception has been granted for 
the schedule item.
    (2) The offeror grants the Contracting Officer or an authorized 
representative the right to examine, at any time before award, books, 
records, documents, or other directly pertinent records to verify any 
request for an exception under this provision, and the reasonableness of 
price. For items priced using catalog or market prices, or law or 
regulation, access does not extend to cost or profit information or 
other data relevant solely to the offeror's determination of the prices 
to be offered in the catalog or marketplace.
    (b) Requirements for cost or pricing data. If the offeror is not 
granted an exception from the requirement to submit cost or pricing 
data, the following applies:
    (1) The offeror shall prepare and submit cost or pricing data and 
supporting attachments in accordance with Table 15-2 of FAR 15.408.
    (2) As soon as practicable after agreement on price, but before 
contract award (except for unpriced actions such as letter contracts), 
the offeror shall submit a Certificate of Current Cost or Pricing Data, 
as prescribed by FAR 15.406-2.

                           (End of provision)

    Alternate I (Oct 1997). As prescribed in 15.408(l), substitute the 
following paragraph (b)(1) for paragraph (b)(1) of the basic provision:

    (b)(1) The offeror shall submit cost or pricing data and supporting 
attachments in the following format:

    Alternate II (Oct 1997). As prescribed in 15.408(l), add the 
following paragraph (c) to the basic provision:

    (c) When the proposal is submitted, also submit one copy each to: 
(1) the Administrative Contracting Officer, and (2) the Contract 
Auditor.

    Alternate III (Oct 1997). As prescribed in 15.408(l), add the 
following paragraph

[[Page 83]]

(c) to the basic provision (if Alternate II is also used, redesignate 
the following paragraph as paragraph (d)).

    (c) Submit the cost portion of the proposal via the following 
electronic media: [Insert media format, e.g., electronic spreadsheet 
format, electronic mail, etc.]

    Alternate IV (Oct 1997). As prescribed in 15.408(l), replace the 
text of the basic provision with the following:

    (a) Submission of cost or pricing data is not required.
    (b) Provide information described below: [Insert description of the 
information and the format that are required, including access to 
records necessary to permit an adequate evaluation of the proposed price 
in accordance with 15.403-3.]

[62 FR 51264, Sept. 30, 1997]



Sec.  52.215-21  Requirements for Cost or Pricing Data or Information 
Other Than Cost or Pricing Data--Modifications.

    As prescribed in 15.408(m), insert the following clause:

Requirements for Cost or Pricing Data or Information Other Than Cost or 
                 Pricing Data--Modifications (OCT 1997)

    (a) Exceptions from cost or pricing data. (1) In lieu of submitting 
cost or pricing data for modifications under this contract, for price 
adjustments expected to exceed the threshold set forth at FAR 15.403-4 
on the date of the agreement on price or the date of the award, 
whichever is later, the Contractor may submit a written request for 
exception by submitting the information described in the following 
subparagraphs. The Contracting Officer may require additional supporting 
information, but only to the extent necessary to determine whether an 
exception should be granted, and whether the price is fair and 
reasonable--
    (i) Identification of the law or regulation establishing the price 
offered. If the price is controlled under law by periodic rulings, 
reviews, or similar actions of a governmental body, attach a copy of the 
controlling document, unless it was previously submitted to the 
contracting office.
    (ii) Information on modifications of contracts or subcontracts for 
commercial items. (A) If--
    (1) The original contract or subcontract was granted an exception 
from cost or pricing data requirements because the price agreed upon was 
based on adequate price competition or prices set by law or regulation, 
or was a contract or subcontract for the acquisition of a commercial 
item; and
    (2) The modification (to the contract or subcontract) is not 
exempted based on one of these exceptions, then the Contractor may 
provide information to establish that the modification would not change 
the contract or subcontract from a contract or subcontract for the 
acquisition of a commercial item to a contract or subcontract for the 
acquisition of an item other than a commercial item.
    (B) For a commercial item exception, the Contractor shall provide, 
at a minimum, information on prices at which the same item or similar 
items have previously been sold that is adequate for evaluating the 
reasonableness of the price of the modification. Such information may 
include--
    (1) For catalog items, a copy of or identification of the catalog 
and its date, or the appropriate pages for the offered items, or a 
statement that the catalog is on file in the buying office to which the 
proposal is being submitted. Provide a copy or describe current discount 
policies and price lists (published or unpublished), e.g., wholesale, 
original equipment manufacturer, or reseller. Also explain the basis of 
each offered price and its relationship to the established catalog 
price, including how the proposed price relates to the price of recent 
sales in quantities similar to the proposed quantities.
    (2) For market-priced items, the source and date or period of the 
market quotation or other basis for market price, the base amount, and 
applicable discounts. In addition, describe the nature of the market.
    (3) For items included on an active Federal Supply Service Multiple 
Award Schedule contract, proof that an exception has been granted for 
the schedule item.
    (2) The Contractor grants the Contracting Officer or an authorized 
representative the right to examine, at any time before award, books, 
records, documents, or other directly pertinent records to verify any 
request for an exception under this clause, and the reasonableness of 
price. For items priced using catalog or market prices, or law or 
regulation, access does not extend to cost or profit information or 
other data relevant solely to the Contractor's determination of the 
prices to be offered in the catalog or marketplace.
    (b) Requirements for cost or pricing data. If the Contractor is not 
granted an exception from the requirement to submit cost or pricing 
data, the following applies:
    (1) The Contractor shall submit cost or pricing data and supporting 
attachments in accordance with Table 15-2 of FAR 15.408.
    (2) As soon as practicable after agreement on price, but before 
award (except for unpriced actions), the Contractor shall submit a 
Certificate of Current Cost or Pricing Data, as prescribed by FAR 
15.406-2.

                             (End of clause)

    Alternate I (OCT 1997). As prescribed in 15.408(m), substitute the 
following

[[Page 84]]

paragraph (b)(1) for paragraph (b)(1) of the basic clause.

    (1) The Contractor shall submit cost or pricing data and supporting 
attachments prepared in the following format:

    Alternate II (OCT 1997). As prescribed in 15.408(m), add the 
following paragraph (c) to the basic clause:

    (c) When the proposal is submitted, also submit one copy each to: 
(1) the Administrative Contracting Officer, and (2) the Contract 
Auditor.

    Alternate III (OCT 1997). As prescribed in 15.408(m), add the 
following paragraph (c) to the basic clause (if Alternate II is also 
used, redesignate the following paragraph as paragraph (d)):

    (c) Submit the cost portion of the proposal via the following 
electronic media: [Insert media format]

    Alternate IV (OCT 1997). As prescribed in 15.408(m), replace the 
text of the basic clause with the following:

    (a) Submission of cost or pricing data is not required.
    (b) Provide information described below: [Insert description of the 
information and the format that are required, including access to 
records necessary to permit an adequate evaluation of the proposed price 
in accordance with 15.403-3.]

[62 FR 51264, Sept. 30, 1997]



Sec.  52.215-22--52.215-42  [Reserved]



Sec.  52.216-1  Type of Contract.

    As prescribed in 16.105, complete and insert the following 
provision:

                       Type of Contract (APR 1984)

    The Government contemplates award of a ------ [Contracting Officer 
insert specific type of contract] contract resulting from this 
solicitation.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34761, July 3, 1995]



Sec.  52.216-2  Economic Price Adjustment--Standard Supplies.

    As prescribed in 16.203-4(a), insert the following clause. The 
clause may be modified by increasing the 10 percent limit on aggregate 
increases specified in subparagraph (c)(1), upon approval by the chief 
of the contracting office.

         Economic Price Adjustment--Standard Supplies (JAN 1997)

    (a) The Contractor warrants that the unit price stated in the 
Schedule for ---- [offeror insert Schedule line item number] is not in 
excess of the Contractor's applicable established price in effect on the 
contract date for like quantites of the same item. The term unit price 
excludes any part of the price directly resulting from requirements for 
preservation, packaging, or packing beyond standard commercial practice. 
The term established price means a price that (1) is an established 
catalog or market price for a commercial item sold in substantial 
quantities to the general public, and (2) is the net price after 
applying any standard trade discounts offered by the Contractor.
    (b) The Contractor shall promptly notify the Contracting Officer of 
the amount and effective date of each decrease in any applicable 
established price. Each corresponding contract unit price shall be 
decreased by the same percentage that the established price is 
decreased. The decrease shall apply to those items delivered on and 
after the effective date of the decrease in the Contractor's established 
price, and this contract shall be modified accordingly.
    (c) If the Contractor's applicable established price is increased 
after the contract date, the corresponding contract unit price shall be 
increased, upon the Contractor's written request to the Contracting 
Officer, by the same percentage that the established price is increased, 
and the contract shall be modified accordingly, subject to the following 
limitations:
    (1) The aggregate of the increases in any contract unit price under 
this clause shall not exceed 10 percent of the original contract unit 
price.
    (2) The increased contract unit price shall be effective (i) on the 
effective date of the increase in the applicable established price if 
the Contracting Officer receives the Contractor's written request within 
10 days thereafter or (ii) if the written request is received later, on 
the date the Contracting Officer receives the request.
    (3) The increased contract unit price shall not apply to quantities 
scheduled under the contract for delivery before the effective date of 
the increased contract unit price, unless 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.
    (4) No modification increasing a contract unit price shall be 
executed under this paragraph (c) until the Contracting Officer verifies 
the increase in the applicable established price.
    (5) Within 30 days after receipt of the Contractor's written 
request, the Contracting

[[Page 85]]

Officer may cancel, without liability to either party, any undelivered 
portion of the contract items affected by the requested increase.
    (d) During the time allowed for the cancellation provided for in 
subparagraph (c)(5) above, and thereafter if there is no cancellation, 
the Contractor shall continue deliveries according to the contract 
delivery schedule, and the Government shall pay for such deliveries at 
the contract unit price, increased to the extent provided by paragraph 
(c) above.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 48221, Sept. 18, 1995; 
62 FR 238, 260, Jan. 2, 1997]



Sec.  52.216-3  Economic Price Adjustment--Semistandard Supplies.

    As prescribed in 16.203-4(b), insert the following clause. The 
clause may be modified by increasing the 10 percent limit on aggregate 
increases specified in subparagraph (c)(1), upon approval by the chief 
of the contracting office.

       Economic Price Adjustment--Semistandard Supplies (JAN 1997)

    (a) The Contractor warrants that the supplies identified as line 
items ---- [offeror insert Schedule line item number] in the Schedule 
are, except for modifications required by the contract specifications, 
supplies for which it has an established price. The term established 
price means a price that (1) is an established catalog or market price 
for a commercial item sold in substantial quantities to the general 
public, and (2) is the net price after applying any standard trade 
discounts offered by the Contractor. The Contractor further warrants 
that, as of the date of this contract, any difference between the unit 
prices stated in the contract for these line items and the Contractor's 
established prices for like quantities of the nearest commercial 
equivalents are due to compliance with contract specifications and with 
any contract requirements for preservation, packaging, and packing 
beyond standard commercial practice.
    (b) The Contractor shall promptly notify the Contracting Officer of 
the amount and effective date of each decrease in any applicable 
established price. Each corresponding contract unit price (exclusive of 
any part of the unit price that reflects modifications resulting from 
compliance with specifications or with requirements for preservation, 
packaging, and packing beyond standard commercial practice) shall be 
decreased by the same percentage that the established price is 
decreased. The decrease shall apply to those items delivered on and 
after the effective date of the decrease in the Contractor's established 
price, and this contract shall be modified accordingly.
    (c) If the Contractor's applicable established price is increased 
after the contract date, the corresponding contract unit price 
(exclusive of any part of the unit price resulting from compliance with 
specifications or with requirements for preservation, packaging, and 
packing beyond standard commercial practice) shall be increased, upon 
the Contractor's written request to the Contracting Officer, by the same 
percentage that the established price is increased, and the contract 
shall be modified accordingly, subject to the following limitations:
    (1) The aggregate of the increases in any contract unit price under 
this clause shall not exceed 10 percent of the original contract unit 
price.
    (2) The increased contract unit price shall be effective (i) on the 
effective date of the increase in the applicable established price if 
the Contracting Officer receives the Contractor's written request within 
10 days thereafter or (ii) if the written request is received later, on 
the date the Contracting Officer receives the request.
    (3) The increased contract unit price shall not apply to quantities 
scheduled under the contract for delivery before the effective date of 
the increased contract unit price, unless 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.
    (4) No modification increasing a contract unit price shall be 
executed under this paragraph (c) until the Contracting Officer verifies 
the increase in the applicable established price.
    (5) Within 30 days after receipt of the Contractor's written 
request, the Contracting Officer may cancel, without liability to either 
party, any undelivered portion of the contract items affected by the 
requested increase.
    (d) During the time allowed for the cancellation provided for in 
subparagraph (c)(5) above, and thereafter if there is no cancellation, 
the Contractor shall continue deliveries according to the contract 
delivery schedule, and the Government shall pay for such deliveries at 
the contract unit price, increased to the extent provided by paragraph 
(c) above.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 48221, Sept. 18, 1995; 
62 FR 238, 261, Jan. 2, 1997; 62 FR 10710, Mar. 10, 1997]



Sec.  52.216-4  Economic Price Adjustment--Labor and Material.

    As prescribed in 16.203-4(c), when contracting by negotiation, 
insert a clause

[[Page 86]]

that is substantially the same as the following clause in solicitations 
and contracts when the conditions specified in 16.203-4(c)(1)(i) through 
(iv) apply (but see 16.203-4(c)(2)). The clause may be modified by 
increasing the 10-percent limit on aggregate increases specified in 
subparagraph (c)(4), upon approval by the chief of the contracting 
office.

        Economic Price Adjustment--Labor and Material (JAN 1997)

    (a) The Contractor shall notify the Contracting Officer if, at any 
time during contract performance, the rates of pay for labor (including 
fringe benefits) or the unit prices for material shown in the Schedule 
either increase or decrease. The Contractor shall furnish this notice 
within 60 days after the increase or decrease, or within any additional 
period that the Contracting Officer may approve in writing, but not 
later than the date of final payment under this contract. The notice 
shall include the Contractor's proposal for an adjustment in the 
contract unit prices to be negotiated under paragraph (b) below, and 
shall include, in the form required by the Contracting Officer, 
supporting data explaining the cause, effective date, and amount of the 
increase or decrease and the amount of the Contractor's adjustment 
proposal.
    (b) Promptly after the Contracting Officer receives the notice and 
data under paragraph (a) above, the Contracting Officer and the 
Contractor shall negotiate a price adjustment in the contract unit 
prices and its effective date. However, the Contracting Officer may 
postpone the negotiations until an accumulation of increases and 
decreases in the labor rates (including fringe benefits) and unit prices 
of material shown in the Schedule results in an adjustment allowable 
under subparagraph (c)(3) below. The Contracting Officer shall modify 
this contract (1) to include the price adjustment and its effective date 
and (2) to revise the labor rates (including fringe benefits) or unit 
prices of material as shown in the Schedule to reflect the increases or 
decreases resulting from the adjustment. The Contractor shall continue 
performance pending agreement on, or determination of, any adjustment 
and its effective date.
    (c) Any price adjustment under this clause is subject to the 
following limitations:
    (1) Any adjustment shall be limited to the effect on unit prices of 
the increases or decreases in the rates of pay for labor (including 
fringe benefits) or unit prices for material shown in the Schedule. 
There shall be no adjustment for (i) supplies or services for which the 
production cost is not affected by such changes, (ii) changes in rates 
or unit prices other than those shown in the Schedule, or (iii) changes 
in the quantities of labor or material used from those shown in the 
Schedule for each item.
    (2) No upward adjustment shall apply to supplies or services that 
are required to be delivered or performed before the effective date of 
the adjustment, unless the Contractor's failure to deliver or perform 
according to the delivery schedule results from causes beyond the 
Contractor's control and without its fault or negligence, within the 
meaning of the Default clause.
    (3) There shall be no adjustment for any change in rates of pay for 
labor (including fringe benefits) or unit prices for material which 
would not result in a net change of at least 3 percent of the then-
current total contract price. This limitation shall not apply, however, 
if, after final delivery of all contract line items, either party 
requests an adjustment under paragraph (b) above.
    (4) The aggregate of the increases in any contract unit price made 
under this clause shall not exceed 10 percent of the original unit 
price. There is no percentage limitation on the amount of decreases that 
may be made under this clause.
    (d) The Contracting Officer may examine the Contractor's books, 
records, and other supporting data relevant to the cost of labor 
(including fringe benefits) and material during all reasonable times 
until the end of 3 years after the date of final payment under this 
contract or the time periods specified in subpart 4.7 of the Federal 
Acquisition Regulation (FAR), whichever is earlier.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 62 FR 238, Jan. 2, 1997]



Sec.  52.216-5  Price Redetermination--Prospective.

    As prescribed in 16.205-4, insert the following clause:

              Price Redetermination--Prospective (OCT 1997)

    (a) General. The unit prices and the total price stated in this 
contract shall be periodically redetermined in accordance with this 
clause, except that (1) the prices for supplies delivered and services 
performed before the first effective date of price redetermination (see 
paragraph (c) below) shall remain fixed and (2) in no event shall the 
total amount paid under this contract exceed any ceiling price included 
in the contract.
    (b) Definition. Costs, as used in this clause, means allowable costs 
in accordance with part 31 of the Federal Acquisition Regulation (FAR) 
in effect on the date of this contract.

[[Page 87]]

    (c) Price redetermination periods. For the purpose of price 
redetermination, performance of this contract is divided into successive 
periods. The first period shall extend from the date of the contract to 
----, [see Note (1)] and the second and each succeeding period shall 
extend for ---- [insert appropriate number] months from the end of the 
last preceding period, except that the parties may agree to vary the 
length of the final period. The first day of the second and each 
succeeding period shall be the effective date of price redetermination 
for that period.
    (d) Data submission. (1) Not more than -- nor less than -- [see Note 
(2)] days before the end of each redetermination period, except the 
last, the Contractor shall submit--
    (i) Proposed prices for supplies that may be delivered or services 
that may be performed in the next succeeding period, and--
    (A) An estimate and breakdown of the costs of these supplies or 
services in the format of Table 15-2, FAR 15.408, or in any other form 
on which the parties may agree;
    (B) Sufficient data to support the accuracy and reliability of this 
estimate; and
    (C) An explanation of the differences between this estimate and the 
original (or last preceding) estimate for the same supplies or services; 
and
    (ii) A statement of all costs incurred in performing this contract 
through the end of the ------ month (see Note (3)) before the submission 
of proposed prices in the format of Table 15-2, FAR 15.408 (or in any 
other form on which the parties may agree), with sufficient supporting 
data to disclose unit costs and cost trends for--
    (A) Supplies delivered and services performed; and
    (B) Inventories of work in process and undelivered contract supplies 
on hand (estimated to the extent necessary).
    (2) The Contractor shall also submit, to the extent that it becomes 
available before negotiations on redetermined prices are concluded--
    (i) Supplemental statements of costs incurred after the date stated 
in subdivision (d)(1)(ii) above for--
    (A) Supplies delivered and services performed; and
    (B) Inventories of work in process and undelivered contract supplies 
on hand (estimated to the extent necessary); and
    (ii) Any other relevant data that the Contracting Officer may 
reasonably require.
    (3) If the Contractor fails to submit the data required by 
subparagraphs (1) and (2) above, within the time specified, the 
Contracting Officer may suspend payments under this contract until the 
data are furnished. If it is later determined that the Government has 
overpaid the Contractor, the Contractor shall repay the excess to the 
Government immediately. Unless repaid within 30 days after the end of 
the data submittal period, the amount of the excess shall bear interest, 
computed from the date the data were due to the date of repayment, at 
the rate established in accordance with the Interest clause.
    (e) Price redetermination. Upon the Contracting Officer's receipt of 
the data required by paragraph (d) above, the Contracting Officer and 
the Contractor shall promptly negotiate to redetermine fair and 
reasonable prices for supplies that may be delivered or services that 
may be performed in the period following the effective date of price 
redetermination.
    (f) Contract modifications. Each negotiated redetermination of 
prices shall be evidenced by a modification to this contract, signed by 
the Contractor and the Contracting Officer, stating the redetermined 
prices that apply during the redetermination period.
    (g) Adjusting billing prices. Pending execution of the contract 
modification (see paragraph (f) above), the Contractor shall submit 
invoices or vouchers in accordance with the billing prices stated in 
this contract. If at any time it appears that the then-current billing 
prices will be substantially greater than the estimated final prices, or 
if the Contractor submits data showing that the redetermined price will 
be substantially greater than the current billing prices, the parties 
shall negotiate an appropriate decrease or increase in billing prices. 
Any billing price adjustment shall be reflected in a contract 
modification and shall not affect the redetermination of prices under 
this clause. After the contract modification for price redetermination 
is executed, the total amount paid or to be paid on all invoices or 
vouchers shall be adjusted to reflect the agreed-upon prices, and any 
requested additional payments, refunds, or credits shall be made 
promptly.
    (h) Quarterly limitation on payments statement. This paragraph (h) 
applies only during periods for which firm prices have not been 
established.
    (1) Within 45 days after the end of the quarter of the Contractor's 
fiscal year in which a delivery is first made (or services are first 
performed) and accepted by the Government under this contract, and for 
each quarter thereafter, the Contractor shall submit to the contract 
administration office (with a copy to the contracting office and the 
cognizant contract auditor) a statement, cumulative from the beginning 
of the contract, showing--
    (i) The total contract price of all supplies delivered (or services 
performed) and accepted by the Government and for which final prices 
have been established;
    (ii) The total costs (estimated to the extent necessary) reasonably 
incurred for, and properly allocable solely to, the supplies delivered 
(or services performed) and accepted

[[Page 88]]

by the Government and for which final prices have not been established;
    (iii) The portion of the total interim profit (used in establishing 
the initial contract price or agreed to for the purpose of this 
paragraph (h)) that is in direct proportion to the supplies delivered 
(or services performed) and accepted by the Government and for which 
final prices have not been established; and
    (iv) The total amount of all invoices or vouchers for supplies 
delivered (or services performed) and accepted by the Government 
(including amounts applied or to be applied to liquidate progress 
payments).
    (2) The statement required by subparagraph (1) above need not be 
submitted for any quarter for which either no costs are to be reported 
under subdivision (1)(ii) above, or revised billing prices have been 
established in accordance with paragraph (g) above, and do not exceed 
the existing contract price, the Contractor's price-redetermination 
proposal, or a price based on the most recent quarterly statement, 
whichever is least.
    (3) Notwithstanding any provision of this contract authorizing 
greater payments, if on any quarterly statement the amount under 
subdivision (1)(iv) above exceeds the sum due the Contractor, as 
computed in accordance with subdivisions (1)(i), (ii), and (iii) above, 
the Contractor shall immediately refund or credit to the Government the 
amount of this excess. The Contractor may, when appropriate, reduce this 
refund or credit by the amount of any applicable tax credits due the 
Contractor under 26 U.S.C. 1481 and by the amount of previous refunds or 
credits effected under this clause. If any portion of the excess has 
been applied to the liquidation of progress payments, then that portion 
may, instead of being refunded, be added to the unliquidated progress 
payment account, consistent with the Progress Payments clause. The 
Contractor shall provide complete details to support any claimed 
reductions in refunds.
    (4) If the Contractor fails to submit the quarterly statement within 
45 days after the end of each quarter and it is later determined that 
the Government has overpaid the Contractor, the Contractor shall repay 
the excess to the Government immediately. Unless repaid within 30 days 
after the end of the statement submittal period, the amount of the 
excess shall bear interest, computed from the date the quarterly 
statement was due to the date of repayment, at the rate established in 
accordance with the Interest clause.
    (i) Subcontracts. No subcontract placed under this contract may 
provide for payment on a cost-plus-a-percentage-of-cost basis.
    (j) Disagreements. If the Contractor and the Contracting Officer 
fail to agree upon redetermined prices for any price redetermination 
period within 60 days (or within such other period as the parties agree) 
after the date on which the data required by paragraph (d) above are to 
be submitted, the Contracting Officer shall promptly issue a decision in 
accordance with the Disputes clause. For the purpose of paragraphs (f), 
(g), and (h) above, and pending final settlement of the disagreement on 
appeal, by failure to appeal, or by agreement, this decision shall be 
treated as an executed contract modification. Pending final settlement, 
price redetermination for subsequent periods, if any, shall continue to 
be negotiated as provided in this clause.
    (k) Termination. If this contract is terminated, prices shall 
continue to be established in accordance with this clause for (1) 
completed supplies and services accepted by the Government and (2) those 
supplies and services not terminated under a partial termination. All 
other elements of the termination shall be resolved in accordance with 
other applicable clauses of this contract.

                             (End of clause)

    Notes: (1) Express in terms of units delivered, or as a date; but in 
either case the period should end on the last day of a month.
    (2) Insert the numbers of days chosen so that the Contractor's 
submission will be late enough to reflect recent cost experience (taking 
into account the Contractor's accounting system), but early enough to 
permit review, audit (if necessary), and negotiation before the start of 
the prospective period.
    (3) Insert first, except that second may be inserted if necessary to 
achieve compatibility with the Contractor's accounting system.

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 48221, Sept. 18, 1995; 
61 FR 67425, Dec. 20, 1996; 62 FR 51265, Sept. 30, 1997]



Sec.  52.216-6  Price Redetermination--Retroactive.

    As prescribed in 16.206-4, insert the following clause:

              Price Redetermination--Retroactive (OCT 1997)

    (a) General. The unit price and the total price stated in this 
contract shall be redetermined in accordance with this clause, but in no 
event shall the total amount paid under this contract exceed ---- 
[insert dollar amount of ceiling price].
    (b) Definition. Costs, as used in this clause, means allowable costs 
in accordance with part 31 of the Federal Acquisition Regulation (FAR) 
in effect on the date of this contract.
    (c) Data submission. (1) Within -- [Contracting Officer insert 
number of days]

[[Page 89]]

days after delivery of all supplies to be delivered and completion of 
all services to be performed under this contract, the Contractor shall 
submit--
    (i) Proposed prices;
    (ii) A statement in the format of table 15-2, FAR 15.408, or in any 
other form on which the parties may agree, of all costs incurred in 
performing the contract; and
    (iii) Any other relevant data that the Contracting Officer may 
reasonably require.
    (2) If the Contractor fails to submit the data required by 
subparagraph (1) above within the time specified, the Contracting 
Officer may suspend payments under this contract until the data are 
furnished. If it is later determined that the Government has overpaid 
the Contractor, the excess shall be repaid to the Government 
immediately. Unless repaid within 30 days after the end of the data 
submittal period, the amount of the excess shall bear interest, computed 
from the date the data were due to the date of repayment, at the rate 
established in accordance with the Interest clause.
    (d) Price determination. Upon the Contracting Officer's receipt of 
the data required by paragraph (c) above, the Contracting Officer and 
the Contractor shall promptly negotiate to redetermine fair and 
reasonable prices for supplies delivered and services performed by the 
Contractor under this contract.
    (e) Contract modification. The negotiated redetermination of price 
shall be evidenced by a modification to this contract, signed by the 
Contractor and the Contracting Officer.
    (f) Adjusting billing prices. Pending execution of the contract 
modification (see paragraph (e) above), the Contractor shall submit 
invoices or vouchers in accordance with billing prices stated in this 
contract. If at any time it appears that the then-current billing prices 
will be substantially greater than the estimated final prices, or if the 
Contractor submits data showing that the redetermined prices will be 
substantially greater than the current billing prices, the parties shall 
negotiate an appropriate decrease or increase in billing prices. Any 
billing price adjustment shall be reflected in a contract modification 
and shall not affect the redetermination of prices under this clause. 
After the contract modification for price redetermination is executed, 
the total amount paid or to be paid on all invoices or vouchers shall be 
adjusted to reflect the agreed-upon prices, and any resulting additional 
payments, refunds, or credits shall be made promptly.
    (g) Quarterly limitation on payments statement. This paragraph (g) 
shall apply until final price redetermination under this contract has 
been completed.
    (1) Within 45 days after the end of the quarter of the Contractor's 
fiscal year in which a delivery is first made (or services are first 
performed) and accepted by the Government under this contract, and for 
each quarter thereafter, the Contractor shall submit to the contract 
administration office (with a copy to the contracting office and the 
cognizant contract auditor), a statement, cumulative from the beginning 
of the contract, showing--
    (i) The total contract price of all supplies delivered (or services 
performed) and accepted by the Government and for which final prices 
have been established;
    (ii) The total costs (estimated to the extent necessary) reasonably 
incurred for, and properly allocable solely to, the supplies delivered 
(or services performed) and accepted by the Government and for which 
final prices have not been established;
    (iii) The portion of the total interim profit (used in establishing 
the initial contract price or agreed to for the purpose of this 
paragraph (g)) that is in direct proportion to the supplies delivered 
(or services performed) and accepted by the Government and for which 
final prices have not been established; and
    (iv) The total amount of all invoices or vouchers for supplies 
delivered (or services performed) and accepted by the Government 
(including amounts applied or to be applied to liquidate progress 
payments).
    (2) Notwithstanding any provision of this contract authorizing 
greater payments, if on any quarterly statement the amount under 
subdivision (1)(iv) above exceeds the sum due the Contractor, as 
computed in accordance with subdivisions (i), (ii), and (iii) above, the 
Contractor shall immediately refund or credit to the Government the 
amount of this excess. The Contractor may, when appropriate, reduce this 
refund or credit by the amount of any applicable tax credits due the 
contractor under 26 U.S.C. 1481 and by the amount of previous refunds or 
credits effected under this clause. If any portion of the excess has 
been applied to the liquidation of progress payments, then that portion 
may, instead of being refunded, be added to the unliquidated progress 
payment account, consistent with the Progress Payments clause. The 
Contractor shall provide complete details to support any claimed 
reduction in refunds.
    (3) If the Contractor fails to submit the quarterly statement within 
45 days after the end of each quarter and it is later determined that 
the Government has overpaid the Contractor, the Contractor shall repay 
the excess to the Government immediately. Unless repaid within 30 days 
after the end of the statement submittal period, the amount of the 
excess shall bear interest, computed from the date the quarterly 
statement was due to the date of repayment, at the rate established in 
accordance with the Interest clause.
    (h) Subcontracts. No subcontract placed under this contract may 
provide for payment on a cost-plus-a-percentage-of-cost basis.

[[Page 90]]

    (i) Disagreements. If the Contractor and the Contracting Officer 
fail to agree upon redetermined prices within 60 days (or within such 
other period as the parties agree) after the date on which the data 
required by paragraph (c) above are to be submitted, the Contracting 
Officer shall promptly issue a decision in accordance with the Disputes 
clause. For the purpose of paragraphs (e), (f), and (g) above, and 
pending final settlement of the disagreement on appeal, by failure to 
appeal, or by agreement, this decision shall be treated as an executed 
contract modification.
    (j) Termination. If this contract is terminated before price 
redetermination, prices shall be established in accordance with this 
clause for completed supplies and services not terminated. All other 
elements of the termination shall be resolved in accordance with other 
applicable clauses of this contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 48221, Sept. 18, 1995; 
61 FR 67426, Dec. 20, 1996; 62 FR 51265, Sept. 30, 1997]



Sec.  52.216-7  Allowable Cost and Payment.

    As prescribed in 16.307(a), insert the following clause:

                  Allowable Cost and Payment (DEC 2002)

    (a) Invoicing. (1) The Government will make payments to the 
Contractor when requested as work progresses, but (except for small 
business concerns) not more often than once every 2 weeks, in amounts 
determined to be allowable by the Contracting Officer in accordance with 
Federal Acquisition Regulation (FAR) subpart 31.2 in effect on the date 
of this contract and the terms of this contract. The Contractor may 
submit to an authorized representative of the Contracting Officer, in 
such form and reasonable detail as the representative may require, an 
invoice or voucher supported by a statement of the claimed allowable 
cost for performing this contract.
    (2) Contract financing payments are not subject to the interest 
penalty provisions of the Prompt Payment Act. Interim payments made 
prior to the final payment under the contract are contract financing 
payments, except interim payments if this contract contains Alternate I 
to the clause at 52.232-25.
    (3) The designated payment office will make interim payments for 
contract financing on the --------[Contracting Officer insert day as 
prescribed by agency head; if not prescribed, insert ``30th''] day after 
the designated billing office receives a proper payment request.
    In the event that the Government requires an audit or other review 
of a specific payment request to ensure compliance with the terms and 
conditions of the contract, the designated payment office is not 
compelled to make payment by the specified due date.
    (b) Reimbursing costs. (1) For the purpose of reimbursing allowable 
costs (except as provided in paragraph (b)(2) of the clause, with 
respect to pension, deferred profit sharing, and employee stock 
ownership plan contributions), the term costs includes only--
    (i) Those recorded costs that, at the time of the request for 
reimbursement, the Contractor has paid by cash, check, or other form of 
actual payment for items or services purchased directly for the 
contract;
    (ii) When the Contractor is not delinquent in paying costs of 
contract performance in the ordinary course of business, costs incurred, 
but not necessarily paid, for--
    (A) Supplies and services purchased directly for the contract and 
associated financing payments to subcontractors, provided payments 
determined due will be made--
    (1) In accordance with the terms and conditions of a subcontract or 
invoice; and
    (2) Ordinarily within 30 days of the submission of the Contractor's 
payment request to the Government;
    (B) Materials issued from the Contractor's inventory and placed in 
the production process for use on the contract;
    (C) Direct labor;
    (D) Direct travel;
    (E) Other direct in-house costs; and
    (F) Properly allocable and allowable indirect costs, as shown in the 
records maintained by the Contractor for purposes of obtaining 
reimbursement under Government contracts; and
    (iii) The amount of financing payments that have been paid by cash, 
check, or other forms of payment to subcontractors.
    (2) Accrued costs of Contractor contributions under employee pension 
plans shall be excluded until actually paid unless--
    (i) The Contractor's practice is to make contributions to the 
retirement fund quarterly or more frequently; and
    (ii) The contribution does not remain unpaid 30 days after the end 
of the applicable quarter or shorter payment period (any contribution 
remaining unpaid shall be excluded from the Contractor's indirect costs 
for payment purposes).
    (3) Notwithstanding the audit and adjustment of invoices or vouchers 
under paragraph (g) below, allowable indirect costs under this contract 
shall be obtained by applying indirect cost rates established in 
accordance with paragraph (d) below.
    (4) Any statements in specifications or other documents incorporated 
in this contract by reference designating performance of services or 
furnishing of materials at the Contractor's expense or at no cost to the

[[Page 91]]

Government shall be disregarded for purposes of cost-reimbursement under 
this clause.
    (c) Small business concerns. A small business concern may receive 
more frequent payments than every 2 weeks.
    (d) Final indirect cost rates. (1) Final annual indirect cost rates 
and the appropriate bases shall be established in accordance with 
subpart 42.7 of the Federal Acquisition Regulation (FAR) in effect for 
the period covered by the indirect cost rate proposal.
    (2)(i) The Contractor shall submit an adequate final indirect cost 
rate proposal to the Contracting Officer (or cognizant Federal agency 
official) and auditor within the 6-month period following the expiration 
of each of its fiscal years. Reasonable extensions, for exceptional 
circumstances only, may be requested in writing by the Contractor and 
granted in writing by the Contracting Officer. The Contractor shall 
support its proposal with adequate supporting data.
    (ii) The proposed rates shall be based on the Contractor's actual 
cost experience for that period. The appropriate Government 
representative and the Contractor shall establish the final indirect 
cost rates as promptly as practical after receipt of the Contractor's 
proposal.
    (3) The Contractor and the appropriate Government representative 
shall execute a written understanding setting forth the final indirect 
cost rates. The understanding shall specify (i) the agreed-upon final 
annual indirect cost rates, (ii) the bases to which the rates apply, 
(iii) the periods for which the rates apply, (iv) any specific indirect 
cost items treated as direct costs in the settlement, and (v) the 
affected contract and/or subcontract, identifying any with advance 
agreements or special terms and the applicable rates. The understanding 
shall not change any monetary ceiling, contract obligation, or specific 
cost allowance or disallowance provided for in this contract. The 
understanding is incorporated into this contract upon execution.
    (4) Failure by the parties to agree on a final annual indirect cost 
rate shall be a dispute within the meaning of the Disputes clause.
    (5) Within 120 days (or longer period if approved in writing by the 
Contracting Officer) after settlement of the final annual indirect cost 
rates for all years of a physically complete contract, the Contractor 
shall submit a completion invoice or voucher to reflect the settled 
amounts and rates.
    (6)(i) If the Contractor fails to submit a completion invoice or 
voucher within the time specified in paragraph (d)(5) of this clause, 
the Contracting Officer may--
    (A) Determine the amounts due to the Contractor under the contract; 
and
    (B) Record this determination in a unilateral modification to the 
contract.
    (ii) This determination constitutes the final decision of the 
Contracting Officer in accordance with the Disputes clause.
    (e) Billing rates. Until final annual indirect cost rates are 
established for any period, the Government shall reimburse the 
Contractor at billing rates established by the Contracting Officer or by 
an authorized representative (the cognizant auditor), subject to 
adjustment when the final rates are established. These billing rates--
    (1) Shall be the anticipated final rates; and
    (2) May be prospectively or retroactively revised by mutual 
agreement, at either party's request, to prevent substantial overpayment 
or underpayment.
    (f) Quick-closeout procedures. Quick-closeout procedures are 
applicable when the conditions in FAR 42.708(a) are satisfied.
    (g) Audit. At any time or times before final payment, the 
Contracting Officer may have the Contractor's invoices or vouchers and 
statements of cost audited. Any payment may be (1) reduced by amounts 
found by the Contracting Officer not to constitute allowable costs or 
(2) adjusted for prior overpayments or underpayments.
    (h) Final payment. (1) Upon approval of a completion invoice or 
voucher submitted by the Contractor in accordance with paragraph (d)(5) 
of this clause, and upon the Contractor's compliance with all terms of 
this contract, the Government shall promptly pay any balance of 
allowable costs and that part of the fee (if any) not previously paid.
    (2) The Contractor shall pay to the Government any refunds, rebates, 
credits, or other amounts (including interest, if any) accruing to or 
received by the Contractor or any assignee under this contract, to the 
extent that those amounts are properly allocable to costs for which the 
Contractor has been reimbursed by the Government. Reasonable expenses 
incurred by the Contractor for securing refunds, rebates, credits, or 
other amounts shall be allowable costs if approved by the Contracting 
Officer. Before final payment under this contract, the Contractor and 
each assignee whose assignment is in effect at the time of final payment 
shall execute and deliver--
    (i) An assignment to the Government, in form and substance 
satisfactory to the Contracting Officer, of refunds, rebates, credits, 
or other amounts (including interest, if any) properly allocable to 
costs for which the Contractor has been reimbursed by the Government 
under this contract; and
    (ii) A release discharging the Government, its officers, agents, and 
employees from all liabilities, obligations, and claims arising out of 
or under this contract, except--
    (A) Specified claims stated in exact amounts, or in estimated 
amounts when the exact amounts are not known;

[[Page 92]]

    (B) Claims (including reasonable incidental expenses) based upon 
liabilities of the Contractor to third parties arising out of the 
performance of this contract; provided, that the claims are not known to 
the Contractor on the date of the execution of the release, and that the 
Contractor gives notice of the claims in writing to the Contracting 
Officer within 6 years following the release date or notice of final 
payment date, whichever is earlier; and
    (C) Claims for reimbursement of costs, including reasonable 
incidental expenses, incurred by the Contractor under the patent clauses 
of this contract, excluding, however, any expenses arising from the 
Contractor's indemnification of the Government against patent liability.

                             (End of clause)

    Alternate I (FEB 1997). As prescribed in 16.307(a)(2), substitute 
the following paragraph (b)(1)(iii) for paragraph (b)(1)(iii) of the 
basic clause:

    (iii) The amount of progress and other payments to the Contractor's 
subcontractors that either have been paid, or that the Contractor is 
required to pay pursuant to the clause of this contract entitled 
``Prompt Payment for Construction Contracts.'' Payments shall be made by 
cash, check, or other form of payment to the Contractor's subcontractors 
under similar cost standards.

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 23607, June 4, 1985; 
56 FR 29138, June 25, 1991; 61 FR 31661, June 20, 1996; 61 FR 67419, 
Dec. 20, 1996; 61 FR 69296, Dec. 31, 1996; 62 FR 12721, Mar. 17, 1997; 
62 FR 64916, Dec. 9, 1997; 63 FR 9065, Feb. 23, 1998; 65 FR 16283, Mar. 
27, 2000; 66 FR 65360, Dec. 18, 2001; 67 FR 6119, Feb. 8, 2002; 67 FR 
70521, Nov. 22, 2002]



Sec.  52.216-8  Fixed Fee.

    As prescribed in 16.307(b), insert the following clause in 
solicitations and contracts when a cost-plus-fixed-fee contract (other 
than a facilities contract or a construction contract) is contemplated.

                          Fixed Fee (MAR 1997)

    (a) The Government shall pay the Contractor for performing this 
contract the fixed fee specified in the Schedule.
    (b) Payment of the fixed fee shall be made as specified in the 
Schedule; provided that after payment of 85 percent of the fixed fee, 
the Contracting Officer may withhold further payment of fee until a 
reserve is set aside in an amount that the Contracting Officer considers 
necessary to protect the Government's interest. This reserve shall not 
exceed 15 percent of the total fixed fee or $100,000, whichever is less. 
The Contracting Officer shall release 75 percent of all fee withholds 
under this contract after receipt of the certified final indirect cost 
rate proposal covering the year of physical completion of this contract, 
provided the Contractor has satisfied all other contract terms and 
conditions, including the submission of the final patent and royalty 
reports, and is not delinquent in submitting final vouchers on prior 
years' settlements. The Contracting Officer may release up to 90 percent 
of the fee withholds under this contract based on the Contractor's past 
performance related to the submission and settlement of final indirect 
cost rate proposals.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 69296, Dec. 31, 1996; 
62 FR 12721, Mar. 17, 1997]



Sec.  52.216-9  Fixed Fee--Construction.

    As prescribed in 16.307(c), insert the following clause in 
solicitations and contracts when a cost-plus-fixed-fee construction 
contract is contemplated:

                   Fixed Fee--Construction (MAR 1997)

    (a) The Government shall pay to the Contractor for performing this 
contract the fixed fee specified in the Schedule.
    (b) Payment of the fixed fee shall be made in installments based 
upon the percentage of completion of the work as determined from 
estimates submitted to and approved by the Contracting Officer, but 
subject to the withholding provisions of paragraph (c) below.
    (c) After the payment of 85 percent of the fixed fee, the 
Contracting Officer may withhold further payment of fee until a reserve 
is set aside in an amount that the Contracting Officer considers 
necessary to protect the Government's interest. This reserve shall not 
exceed 15 percent of the total fixed fee or $100,000, whichever is less. 
The Contracting Officer shall release 75 percent of all fee withholds 
under this contract after receipt of the certified final indirect cost 
rate proposal covering the year of physical completion of this contract, 
provided the Contractor has satisifed all other contract terms and 
conditions, including the submission of the final patent and royalty 
reports, and is not delinquent in submitting final vouchers on prior 
years' settlements. The Contracting Officer may release up to 90 percent 
of the fee withholds under this contract based on the Contractor's past 
performance related to the submission and settlement of final indirect 
cost rate proposals.

[[Page 93]]

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 69296, Dec. 31, 1996; 
62 FR 12721, Mar. 17, 1997]



Sec.  52.216-10  Incentive Fee.

    As prescribed in 16.307(d), insert the following clause in 
solicitations and contracts when a cost-plus-incentive-fee contract 
(other than a facilities contract) is contemplated:

                        Incentive Fee (MAR 1997)

    (a) General. The Government shall pay the Contractor for performing 
this contract a fee determined as provided in this contract.
    (b) Target cost and target fee. The target cost and target fee 
specified in the Schedule are subject to adjustment if the contract is 
modified in accordance with paragraph (d) below.
    (1) Target cost, as used in this contract, means the estimated cost 
of this contract as initially negotiated, adjusted in accordance with 
paragraph (d) below.
    (2) Target fee, as used in this contract, means the fee initially 
negotiated on the assumption that this contract would be performed for a 
cost equal to the estimated cost initially negotiated, adjusted in 
accordance with paragraph (d) below.
    (c) Withholding of payment. Normally, the Government shall pay the 
fee to the Contractor as specified in the Schedule. However, when the 
Contracting Officer considers that performance or cost indicates that 
the Contractor will not achieve target, the Government shall pay on the 
basis of an appropriate lesser fee. When the Contractor demonstrates 
that performance or cost clearly indicates that the Contractor will earn 
a fee significantly above the target fee, the Government may, at the 
sole discretion of the Contracting Officer, pay on the basis of an 
appropriate higher fee. After payment of 85 percent of the applicable 
fee, the Contracting Officer may withhold further payment of fee until a 
reserve is set aside in an amount that the Contracting Officer considers 
necessary to protect the Government's interest. This reserve shall not 
exceed 15 percent of the applicable fee or $100,000, whichever is less. 
The Contracting Officer shall release 75 percent of all fee withholds 
under this contract after receipt of the certified final indirect cost 
rate proposal covering the year of physical completion of this contract, 
provided the Contractor has satisfied all other contract terms and 
conditions, including the submission of the final patent and royalty 
reports, and is not delinquent in submitting final vouchers on prior 
years' settlements. The Contracting Officer may release up to 90 percent 
of the fee withholds under this contract based on the Contractor's past 
performance related to the submission and settlement of final indirect 
cost rate proposals.
    (d) Equitable adjustments. When the work under this contract is 
increased or decreased by a modification to this contract or when any 
equitable adjustment in the target cost is authorized under any other 
clause, equitable adjustments in the target cost, target fee, minimum 
fee, and maximum fee, as appropriate, shall be stated in a supplemental 
agreement to this contract.
    (e) Fee payable. (1) The fee payable under this contract shall be 
the target fee increased by -- [Contracting Officer insert Contractor's 
participation] cents for every dollar that the total allowable cost is 
less than the target cost or decreased by -- [Contracting Officer insert 
Contractor's participation] cents for every dollar that the total 
allowable cost exceeds the target cost. In no event shall the fee be 
greater than -- [Contracting Officer insert percentage] percent or less 
than -- [Contracting Officer insert percentage] percent of the target 
cost.
    (2) The fee shall be subject to adjustment, to the extent provided 
in paragraph (d) above, and within the minimum and maximum fee 
limitations in subparagraph (1) above, when the total allowable cost is 
increased or decreased as a consequence of (i) payments made under 
assignments or (ii) claims excepted from the release as required by 
paragraph (h)(2) of the Allowable Cost and Payment clause.
    (3) If this contract is terminated in its entirety, the portion of 
the target fee payable shall not be subject to an increase or decrease 
as provided in this paragraph. The termination shall be accomplished in 
accordance with other applicable clauses of this contract.
    (4) For the purpose of fee adjustment, total allowable cost shall 
not include allowable costs arising out of--
    (i) Any of the causes covered by the Excusable Delays clause to the 
extent that they are beyond the control and without the fault or 
negligence of the Contractor or any subcontractor;
    (ii) The taking effect, after negotiating the target cost, of a 
statute, court decision, written ruling, or regulation that results in 
the Contractor's being required to pay or bear the burden of any tax or 
duty or rate increase in a tax or duty;
    (iii) Any direct cost attributed to the Contractor's involvement in 
litigation as required by the Contracting Officer pursuant to a clause 
of this contract, including furnishing evidence and information 
requested pursuant to the Notice and Assistance Regarding Patent and 
Copyright Infringement clause;
    (iv) The purchase and maintenance of additional insurance not in the 
target cost and

[[Page 94]]

required by the Contracting Officer, or claims for reimbursement for 
liabilities to third persons pursuant to the Insurance--Liability to 
Third Persons clause;
    (v) Any claim, loss, or damage resulting from a risk for which the 
Contractor has been relieved of liability by the Government Property 
clause; or
    (vi) Any claim, loss, or damage resulting from a risk defined in the 
contract as unusually hazardous or as a nuclear risk and against which 
the Government has expressly agreed to indemnify the Contractor.
    (5) All other allowable costs are included in total allowable cost 
for fee adjustment in accordance with this paragraph (e), unless 
otherwise specifically provided in this contract.
    (f) Contract modification. The total allowable cost and the adjusted 
fee determined as provided in this clause shall be evidenced by a 
modification to this contract signed by the Contractor and Contracting 
Officer.
    (g) Inconsistencies. In the event of any language inconsistencies 
between this clause and provisioning documents or Government options 
under this contract, compensation for spare parts or other supplies and 
services ordered under such documents shall be determined in accordance 
with this clause.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 69296, Dec. 31, 1996; 
62 FR 12721, Mar. 17, 1997]



Sec.  52.216-11  Cost Contract--No Fee.

    As prescribed in 16.307(e), insert the following clause in 
solicitations and contracts when a cost-reimbursement contract is 
contemplated that provides no fee and is not a cost-sharing contract or 
a facilities contract. This clause may be modified by substituting 
$10,000 in lieu of $100,000 as the maximum reserve in paragraph (b) if 
the Contractor is a nonprofit organization.

                    Cost Contract--No Fee (APR 1984)

    (a) The Government shall not pay the Contractor a fee for performing 
this contract.
    (b) After payment of 80 percent of the total estimated cost shown in 
the Schedule, the Contracting Officer may withhold further payment of 
allowable cost until a reserve is set aside in an amount that the 
Contracting Officer considers necessary to protect the Government's 
interest. This reserve shall not exceed one percent of the total 
estimated cost shown in the Schedule or $100,000, whichever is less.

                             (End of clause)

    Alternate I (APR 1984). In a contract for research and development 
with an educational institution or a nonprofit organization, for which 
the contracting officer has determined that withholding of a portion of 
allowable costs is not required, delete paragraph (b) of the basic 
clause.



Sec.  52.216-12  Cost-Sharing Contract--No Fee.

    As prescribed in 16.307(f), insert the following clause in 
solicitations and contracts when a cost-sharing contract (other than a 
facilities contract) is contemplated. This clause may be modified by 
substituting $10,000 in lieu of $100,000 as the maximum reserve in 
paragraph (b) if the contract is with a nonprofit organization.

                Cost-Sharing Contract--No Fee (APR 1984)

    (a) The Government shall not pay to the Contractor a fee for 
performing this contract.
    (b) After paying 80 percent of the Government's share of the total 
estimated cost of performance shown in the Schedule, the Contracting 
Officer may withhold further payment of allowable cost until a reserve 
is set aside in an amount that the Contracting Officer considers 
necessary to protect the Government's interest. This reserve shall not 
exceed one percent of the Government's share of the total estimated cost 
shown in the Schedule or $100,000, whichever is less.

                             (End of clause)

    Alternate I (APR 1984). In a contract for research and development 
with an educational institution, for which the contracting officer has 
determined that withholding of a portion of allowable cost is not 
required, delete paragraph (b) of the basic clause.



Sec.  52.216-13  Allowable Cost and Payment--Facilities.

    As prescribed in 16.307(g), insert the following clause:

            Allowable Cost and Payment--Facilities (FEB 2002)

    (a) General. (1) For the performance of any work, duty, or 
obligation specified in this contract to be at Government expense, the 
Government shall pay the Contractor all allowable costs as determined by 
the Contracting Officer in accordance with the contract terms and 
section 31.106 of the Federal

[[Page 95]]

Acquisition Regulation (FAR) in effect on the contract date.
    (2) Except as otherwise specifically provided in this contract, the 
failure of this contract to provide for reimbursement does not preclude 
the Contractor from including, as part of the price or cost under any 
other Government contract or subcontract, an allocable portion of the 
costs incurred for any work, duty, or obligation performed under this 
contract, but not reimbursable under it.
    (b) Invoicing. (1) The Government will make payments to the 
Contractor when requested once each month. The Contractor may submit to 
an authorized representative of the Contracting Officer, in such form 
and reasonable detail as the representative may require, an invoice or 
voucher supported by a statement of the claimed allowable cost for the 
performance of this contract.
    (2) Contract financing payments are not subject to the interest 
penalty provisions of the Prompt Payment Act. Interim payments made 
prior to the final payment under the contract are contract financing 
payments, except interim payments if this contract contains Alternate I 
to the clause at 52.232-25.
    (3) The designated payment office will make interim payments for 
contract financing on the --------[Contracting Officer insert day as 
prescribed by agency head; if not prescribed, insert ``30th''] day after 
the designated billing office receives a proper payment request. In the 
event that the Government requires an audit or other review of a 
specific payment request to ensure compliance with the terms and 
conditions of the contract, the designated payment office is not 
compelled to make payment by the specified due date.
    (c) Negotiated indirect costs. Notwithstanding the audit and 
adjustment of invoices or vouchers under paragraph (f) of this clause, 
allowable indirect costs under this contract shall be obtained by 
applying final indirect cost rates established as follows:
    (1) Final annual indirect cost rates and the appropriate bases shall 
be established in accordance with subpart 42.7 of the FAR in effect for 
the period covered by the indirect cost rate proposal.
    (2)(i) The Contractor shall submit an adequate final indirect cost 
rate proposal to the Contracting Officer (or cognizant Federal agency 
official) and auditor within the 6-month period following the expiration 
of each of its fiscal years. Reasonable extensions, for exceptional 
circumstances only, may be requested in writing by the Contractor and 
granted in writing by the Contracting Officer. The Contractor shall 
support its proposal with adequate supporting data.
    (ii) The proposed rates shall be based on the Contractor's actual 
cost experience for that period. The appropriate Government 
representative and the Contractor shall establish the final indirect 
cost rates as promptly as practical after receipt of the Contractor's 
proposal.
    (3) The Contractor and the appropriate Government representative 
shall execute a written understanding setting forth the final indirect 
cost rates. The understanding shall specify (i) the agreed-upon final 
annual indirect cost rates, (ii) the bases to which the rates apply, 
(iii) the periods for which the rates apply, (iv) any specific indirect 
cost items treated as direct costs in the settlement, and (v) the 
affected contract and/or subcontract, identifying any with advance 
agreements or special terms and the applicable rates. The understanding 
shall not change any monetary ceiling, contract obligation, or specific 
cost allowance or disallowance provided for in this contract. The 
understanding is incorporated into this contract upon execution.
    (4) Within 120 days after settlement of the final indirect cost 
rates covering the year in which this contract is physically complete 
(or longer, if approved in writing by the Contracting Officer), the 
Contractor shall submit a completion invoice or voucher to reflect the 
settled amounts and rates.
    (5) Failure by the parties to agree on a final annual indirect cost 
rate shall be a dispute within the meaning of the Disputes clause.
    (d) Billing rates. Until final annual indirect cost rates are 
established for any period, the Government shall reimburse the 
Contractor at billing rates established by the Contracting Officer or by 
an authorized representative (the cognizant auditor), subject to 
adjustment when the final rates are established. These billing rates--
    (1) Shall be the anticipated final rates; and
    (2) May be prospectively or retroactively revised by mutual 
agreement, at either party's request, to prevent substantial overpayment 
or underpayment.
    (e) Quick-closeout procedures. Quick-closeout procedures are 
applicable when the conditions in FAR 42.708(a) are satisfied.
    (f) Audit. At any time or times before final payment, the 
Contracting Officer may have the Contractor's invoices or vouchers and 
statements of cost audited. Any payment may be (1) reduced by amounts 
found by the Contracting Officer not to constitute allowable costs or 
(2) adjusted for prior overpayments or underpayments.
    (g) Assignments and releases. The Contractor shall pay to the 
Government any refunds, rebates, credits, or other amounts (including 
interest, if any) accruing to or received by the Contractor or any 
assignee under this contract, to the extent that those amounts are 
properly allocable to costs for which the Contractor has been reimbursed 
by the Government. Reasonable expenses incurred by the Contractor for 
securing refunds, rebates,

[[Page 96]]

credits, or other amounts shall be allowable costs if approved by the 
Contracting Officer. Before final payment under this contract, the 
Contractor and each assignee shall execute and deliver--
    (1) An assignment to the Government, in form and substance 
satisfactory to the Contracting Officer, of refunds, rebates, credits, 
or other amounts (including interest, if any) properly allocable to 
costs for which the Contractor has been reimbursed by the Government 
under this contract; and
    (2) A release discharging the Government, its officers, agents, and 
employees from all liabilities, obligations, and claims arising out of 
or under this contract, except--
    (i) Specified claims stated in exact amounts, or in estimated 
amounts when the exact amounts are not known;
    (ii) Claims (including reasonable incidental expenses) based upon 
liabilities of the Contractor to third parties arising out of 
performance of this contract; provided that the claims are not known to 
the Contractor on the date of the execution of the release, and that the 
Contractor gives notice of the claims in writing to the Contracting 
Officer within 6 years following the release date or notice of final 
payment date, whichever is earlier; and
    (iii) Claims for reimbursement of costs, including related expenses, 
incurred by the Contractor under the patent clauses of this contract, 
excluding, however, any expenses arising from the Contractor's 
indemnification of the Government against patent liability.

                             (End of clause)

    Alternate I (MAR 1997). If the contract is for facilities 
acquisition, and the Contracting Officer considers it appropriate, add 
the following paragraphs (g) and (h) to the basic clause, and 
redesignate paragraph (g) of the basic clause as paragraph (i):

    (g) Withholding. After payment of 80 percent of the total estimated 
cost shown in the Schedule, the Contracting Officer may withhold payment 
of allowable costs until a reserve is set aside in an amount that the 
Contracting Officer considers necessary to protect the Government's 
interest. This reserve shall not exceed one percent of the total 
estimated cost shown in the Schedule or $100,000, whichever is less.
    (h) Final Payment. Upon approval of a completion invoice or voucher 
submitted by the Contractor in accordance with paragraph (c)(4) of this 
clause, and upon the Contractor's compliance with all terms of this 
contract, the Government shall promptly pay any balance of allowable 
costs not previously paid.

[48 FR 42478, Sept. 19, 1983, as amended at 59 FR 67052, Dec. 28, 1994; 
61 FR 31661, June 20, 1996; 61 FR 69296, Dec. 31, 1996; 62 FR 12721, 
Mar. 17, 1997; 62 FR 64916, Dec. 9, 1997; 63 FR 9065, Feb. 23, 1998; 66 
FR 65361, Dec. 18, 2001]



Sec.  52.216-14  Allowable Cost and Payment--Facilities Use.

    As prescribed in 16.307(h), insert the following clause in 
solicitations and contracts when a facilities use contract is 
contemplated:

          Allowable Cost and Payment--Facilities Use (APR 1984)

    (a) For the performance of any work, duty, or obligations specified 
in this contract to be at Government expense, the Government shall pay 
the Contractor all allowable costs as determined by the Contracting 
Officer in accordance with the contract terms and section 31.106 of the 
Federal Acquisition Regulation (FAR) in effect on the contract date.
    (b) Except as otherwise specifically provided in this contract, the 
failure of this contract to provide for reimbursement does not preclude 
the Contractor from including, as part of the price or cost under any 
other Government contract or subcontract, an allocable portion of the 
costs incurred for any work, duty, or obligation performed under this 
contract, but not reimbursed under it.

                             (End of clause)



Sec.  52.216-15  Predetermined Indirect Cost Rates.

    As prescribed in 16.307(i), insert the following clause:

              Predetermined Indirect Cost Rates (APR 1998)

    (a) Notwithstanding the Allowable Cost and Payment clause of this 
contract, the allowable indirect costs under this contract shall be 
obtained by applying predetermined indirect cost rates to bases agreed 
upon by the parties, as specified below.
    (b)(1) The Contractor shall submit an adequate final indirect cost 
rate proposal to the Contracting Officer (or cognizant Federal agency 
official) and auditor within the 6-month period following the expiration 
of each of its fiscal years. Reasonable extensions, for exceptional 
circumstances only, may be requested in writing by the Contractor and 
granted in writing by the Contracting Officer. The Contractor shall 
support its proposal with adequate supporting data.
    (2) The proposed rates shall be based on the Contractor's actual 
cost experience for that

[[Page 97]]

period. The appropriate Government representative and the Contractor 
shall establish the final indirect cost rates as promptly as practical 
after receipt of the Contractor's proposal.
    (c) Allowability of costs and acceptability of cost allocation 
methods shall be determined in accordance with FAR subpart 31.3 in 
effect on the date of this contract.
    (d) Predetermined rate agreements in effect on the date of this 
contract shall be incorporated into the contract Schedule. The 
Contracting Officer (or cognizant Federal agency official) and 
Contractor shall negotiate rates for subsequent periods and execute a 
written indirect cost rate agreement setting forth the results. The 
agreement shall specify (1) the agreed-upon predetermined indirect cost 
rates, (2) the bases to which the rates apply, (3) the period for which 
the rates apply, and (4) the specific items treated as direct costs or 
any changes in the items previously agreed to be direct costs. The 
indirect cost rate agreement shall not change any monetary ceiling, 
contract obligation, or specific cost allowance or disallowance provided 
for in this contract. The agreement is incorporated into this contract 
upon execution.
    (e) Pending establishment of predetermined indirect cost rates for 
any fiscal year (or other period agreed to by the parties), the 
Contractor shall be reimbursed either at the rates fixed for the 
previous fiscal year (or other period) or at billing rates acceptable to 
the Contracting Officer (or cognizant Federal agency official), subject 
to appropriate adjustment when the final rates for that period are 
established.
    (f) Any failure by the parties to agree on any predetermined 
indirect cost rates under this clause shall not be considered a dispute 
within the meaning of the Disputes clause. If for any fiscal year (or 
other period specified in the Schedule) the parties fail to agree to 
predetermined indirect cost rates, the allowable indirect costs shall be 
obtained by applying final indirect cost rates established in accordance 
with the Allowable Cost and Payment clause.
    (g) Allowable indirect costs for the period from the beginning of 
performance until the end of the Contractor's fiscal year (or other 
period specified in the Schedule) shall be obtained using the 
predetermined indirect cost rates and the bases shown in the Schedule.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 31622, June 20, 1996; 
62 FR 64916, Dec. 9, 1997; 63 FR 9065, Feb. 23, 1998]



Sec.  52.216-16  Incentive Price Revision--Firm Target.

    As prescribed in 16.406(a), insert the following clause:

            Incentive Price Revision--Firm Target (OCT 1997)

    (a) General. The supplies or services identified in the Schedule as 
Items ---- [Contracting Officer insert Schedule line item numbers] are 
subject to price revision in accordance with this clause; provided, that 
in no event shall the total final price of these items exceed the 
ceiling price of ---- dollars ($----). Any supplies or services that are 
to be (1) ordered separately under, or otherwise added to, this contract 
and (2) subject to price revision in accordance with the terms of this 
clause shall be identified as such in a modification to this contract.
    (b) Definition. Costs, as used in this clause, means allowable costs 
in accordance with part 31 of the Federal Acquisition Regulation (FAR) 
in effect on the date of this contract.
    (c) Data submission. (1) Within ---- [Contracting Officer insert 
number of days] days after the end of the month in which the Contractor 
has delivered the last unit of supplies and completed the services 
specified by item number in paragraph (a) of this clause, the Contractor 
shall sumbit in the format of Table 15-2, FAR 15.408, or in any other 
form on which the parties agree--
    (i) A detailed statement of all costs incurred up to the end of that 
month in performing all work under the items;
    (ii) An estimate of costs of further performance, if any, that may 
be necessary to complete performance of all work under the items;
    (iii) A list of all residual inventory and an estimate of its value; 
and
    (iv) Any other relevant data that the Contracting Officer may 
reasonably require.
    (2) If the Contractor fails to submit the data required by 
subparagraph (1) above within the time specified and it is later 
determined that the Government has overpaid the Contractor, the 
Contractor shall repay the excess to the Government immediately. Unless 
repaid within 30 days after the end of the data submittal period, the 
amount of the excess shall bear interest, computed from the date the 
data were due to the date of repayment, at the rate established in 
accordance with the Interest clause.
    (d) Price revision. Upon the Contracting Officer's receipt of the 
data required by paragraph (c) above, the Contracting Officer and the 
Contractor shall promptly establish the total final price of the items 
specified in (a) above by applying to final negotiated cost an 
adjustment for profit or loss, as follows:
    (1) On the basis of the information required by paragraph (c) above, 
together with any other pertinent information, the parties

[[Page 98]]

shall negotiate the total final cost incurred or to be incurred for 
supplies delivered (or services performed) and accepted by the 
Government and which are subject to price revision under this clause.
    (2) The total final price shall be established by applying to the 
total final negotiated cost an adjustment for profit or loss, as 
follows:
    (i) If the total final negotiated cost is equal to the total target 
cost, the adjustment is the total target profit.
    (ii) If the total final negotiated cost is greater than the total 
target cost, the adjustment is the total target profit, less -- 
[Contracting Officer insert percent] percent of the amount by which the 
total final negotiated cost exceeds the total target cost.
    (iii) If the final negotiated cost is less than the total target 
cost, the adjustment is the total target profit plus -- [Contracting 
Officer insert percent] percent of the amount by which the total final 
negotiated cost is less than the total target cost.
    (e) Contract modification. The total final price of the items 
specified in paragraph (a) above shall be evidenced by a modification to 
this contract, signed by the Contractor and the Contracting Officer. 
This price shall not be subject to revision, notwithstanding any changes 
in the cost of performing the contract, except to the extent that--
    (1) The parties may agree in writing, before the determination of 
total final price, to exclude specific elements of cost from this price 
and to a procedure for subsequent disposition of those elements; and
    (2) Adjustments or credits are explicitly permitted or required by 
this or any other clause in this contract.
    (f) Adjusting billing prices. (1) Pending execution of the contract 
modification (see paragraph (e) above), the Contractor shall submit 
invoices or vouchers in accordance with billing prices as provided in 
this paragraph. The billing prices shall be the target prices shown in 
this contract.
    (2) If at any time it appears from information provided by the 
contractor under subparagraph (g)(2) below that the then-current billing 
prices will be substantially greater than the estimated final prices, 
the parties shall negotiate a reduction in the billing prices. 
Similarly, the parties may negotiate an increase in billing prices by 
any or all of the difference between the target prices and the ceiling 
price, upon the Contractor's submission of factual data showing that 
final cost under this contract will be substantially greater than the 
target cost.
    (3) Any billing price adjustment shall be reflected in a contract 
modification and shall not affect the determination of the total final 
price under paragraph (d) above. After the contract modification 
establishing the total final price is executed, the total amount paid or 
to be paid on all invoices or vouchers shall be adjusted to reflect the 
total final price, and any resulting additional payments, refunds, or 
credits shall be made promptly.
    (g) Quarterly limitation on payments statement. This paragraph (g) 
shall apply until final price revision under this contract has been 
completed.
    (1) Within 45 days after the end of each quarter of the Contractor's 
fiscal year in which a delivery is first made (or services are first 
performed) and accepted by the Government under this contract, and for 
each quarter thereafter, the Contractor shall submit to the contract 
administration office (with a copy to the contracting office and the 
cognizant contract auditor) a statement, cumulative from the beginning 
of the contract, showing--
    (i) The total contract price of all supplies delivered (or services 
performed) and accepted by the Government and for which final prices 
have been established;
    (ii) The total costs (estimated to the extent necessary) reasonably 
incurred for, and properly allocable solely to, the supplies delivered 
(or services performed) and accepted by the Government and for which 
final prices have not been established;
    (iii) The portion of the total target profit (used in establishing 
the initial contract price or agreed to for the purpose of this 
paragraph (g)) that is in direct proportion to the supplies delivered 
(or services performed) and accepted by the Government and for which 
final prices have not been established--increased or decreased in 
accordance with subparagraph (d)(2) above, when the amount stated under 
subdivision (ii), immediately above, differs from the aggregate target 
costs of the supplies or services; and
    (iv) The total amount of all invoices or vouchers for supplies 
delivered (or services performed) and accepted by the Government 
(including amounts applied or to be applied to liquidate progress 
payments).
    (2) Notwithstanding any provision of this contract authorizing 
greater payments, if on any quarterly statement the amount under 
subdivision (1)(iv) above exceeds the sum due the Contractor, as 
computed in accordance with subdivisions (1)(i), (ii), and (iii) above, 
the Contractor shall immediately refund or credit to the Government the 
amount of this excess. The Contractor may, when appropriate, reduce this 
refund or credit by the amount of any applicable tax credits due the 
Contractor under 26 U.S.C. 1481 and by the amount of previous refunds or 
credits effected under this clause. If any portion of the excess has 
been applied to the liquidation of progress payments, then that portion 
may, instead of being refunded, be added to the unliquidated progress 
payment account consistent with the Progress Payments clause.

[[Page 99]]

The Contractor shall provide complete details to support any claimed 
reductions in refunds.
    (3) If the Contractor fails to submit the quarterly statement within 
45 days after the end of each quarter and it is later determined that 
the Government has overpaid the Contractor, the Contractor shall repay 
the excess to the Government immediately. Unless repaid within 30 days 
after the end of the statement submittal period, the amount of the 
excess shall bear interest, computed from the date the quarterly 
statement was due to the date of repayment, at the rate established in 
accordance with the Interest clause.
    (h) Subcontracts. No subcontract placed under this contract may 
provide for payment on a cost-plus-a-percentage-of-cost basis.
    (i) Disagreements. If the Contractor and the Contracting Officer 
fail to agree upon the total final price within 60 days (or within such 
other period as the Contracting Officer may specify) after the date on 
which the data required by paragraph (c) above are to be submitted, the 
Contracting Officer shall promptly issue a decision in accordance with 
the Disputes clause.
    (j) Termination. If this contract is terminated before the total 
final price is established, prices of supplies or services subject to 
price revision shall be established in accordance with this clause for 
(1) completed supplies and services accepted by the Government and (2) 
those supplies and services not terminated under a partial termination. 
All other elements of the termination shall be resolved in accordance 
with other applicable clauses of this contract.
    (k) Equitable adjustment under other clauses. If an equitable 
adjustment in the contract price is made under any other clause of this 
contract before the total final price is established, the adjustment 
shall be made in the total target cost and may be made in the maximum 
dollar limit on the total final price, the total target profit, or both. 
If the adjustment is made after the total final price is established, 
only the total final price shall be adjusted.
    (l) Exclusion from target price and total final price. If any clause 
of this contract provides that the contract price does not or will not 
include an amount for a specific purpose, then neither any target price 
nor the total final price includes or will include any amount for that 
purpose.
    (m) Separate reimbursement. If any clause of this contract expressly 
provides that the cost of performance of an obligation shall be at 
Government expense, that expense shall not be included in any target 
price or in the total final price, but shall be reimbursed separately.
    (n) Taxes. As used in the Federal, State, and Local Taxes clause or 
in any other clause that provides for certain taxes or duties to be 
included in, or excluded from, the contract price, the term contract 
price includes the total target price or, if it has been established, 
the total final price. When any of these clauses requires that the 
contract price be increased or decreased as a result of changes in the 
obligation of the Contractor to pay or bear the burden of certain taxes 
or duties, the increase or decrease shall be made in the total target 
price or, if it has been established, in the total final price, so that 
it will not affect the Contractor's profit or loss on this contract.

                             (End of clause)

    Alternate I (APR 1984). As prescribed in 16.406(a), add the 
following paragraph (o) to the basic clause:

    (o) Provisioning and options. Parts, other supplies, or services 
that are to be furnished under this contract on the basis of a 
provisioning document or Government option shall be subject to price 
revision in accordance with this clause. Any prices established for 
these parts, other supplies, or services under a provisioning document 
or Government option shall be treated as target prices. Target cost and 
profit covering these parts, other supplies, or services may be 
established separately, in the aggregate, or in any combination, as the 
parties may agree.

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 67426, Dec. 20, 1996; 
62 FR 12696, Mar. 17, 1997; 62 FR 51265, Sept. 30, 1997]



Sec.  52.216-17  Incentive Price Revision--Successive Targets.

    As prescribed in 16.406(b), insert the following clause:

         Incentive Price Revision--Successive Targets (OCT 1997)

    (a) General. The supplies or services identified in the Schedule as 
Items ---- [Contracting Officer insert line item numbers] are subject to 
price revision in accordance with this clause; provided, that in no 
event shall the total final price of these items exceed the ceiling 
price of ---- dollars ($----). The prices of these items shown in the 
Schedule are the initial target prices, which include an initial target 
profit of -- [Contracting Officer insert percent] percent of the initial 
target cost. Any supplies or services that are to be (1) ordered 
separately under, or otherwise added to, this contract and (2) subject 
to price revision in accordance with this clause shall be identified as 
such in a modification to this contract.
    (b) Definition. Costs, as used in this clause, means allowable costs 
in accordance with part 31 of the Federal Acquisition Regulation (FAR) 
in effect on the date of this contract.

[[Page 100]]

    (c) Submitting data for establishing the firm fixed price or a final 
profit adjustment formula. (1) Within -- [Contracting Officer insert 
number of days] days after the end of the month in which the Contractor 
has completed ---- [see Note 1], the Contractor shall submit the 
following data:
    (i) A proposed firm fixed price or total firm target price for 
supplies delivered and to be delivered and services performed and to be 
performed.
    (ii) A detailed statement of all costs incurred in the performance 
of this contract through the end of the month specified above, in the 
format of Table 15-2, FAR 15.408 (or in any other form on which the 
parties may agree), with sufficient supporting data to disclose unit 
costs and cost trends for--
    (A) Supplies delivered and services performed; and
    (B) Inventories of work in process and undelivered contract supplies 
on hand (estimated to the extent necessary).
    (iii) An estimate of costs of all supplies delivered and to be 
delivered and all services performed and to be performed under this 
contract, using the statement of costs incurred plus an estimate of 
costs to complete performance, in the format of table 15-2, FAR 15.408 
(or in any other form on which the parties may agree), together with--
    (A) Sufficient data to support the accuracy and reliability of the 
estimate; and
    (B) An explanation of the differences between this estimate and the 
original estimate used to establish the initial target prices.
    (2) The Contractor shall also submit, to the extent that it becomes 
available before negotiations establishing the total firm price are 
concluded--
    (i) Supplemental statements of costs incurred after the end of the 
month specified in subparagraph (1) above for--
    (A) Supplies delivered and services performed; and
    (B) Inventories of work in process and undelivered contract supplies 
on hand (estimated to the extent necessary); and
    (ii) Any other relevant data that the Contracting Officer may 
reasonably require.
    (3) If the Contractor fails to submit the data required by 
subparagraphs (1) and (2) above within the time specified and it is 
later determined that the Government has overpaid the Contractor, the 
Contractor shall repay the excess to the Government immediately. Unless 
repaid within 30 days after the end of the data submittal period, the 
amount of the excess shall bear interest, computed from the date the 
data were due to the date of repayment, at the rate established in 
accordance with the Interest clause.
    (d) Establishing firm fixed price or final profit adjustment 
formula. Upon the Contracting Officer's receipt of the data required by 
paragraph (c) above the Contracting Officer and the Contractor shall 
promptly establish either a firm fixed price or a profit adjustment 
formula for determining final profit, as follows:
    (1) The parties shall negotiate a total firm target cost, based upon 
the data submitted under paragraph (c) above.
    (2) If the total firm target cost is more than the total initial 
target cost, the total initial target profit shall be decreased. If the 
total firm target cost is less than the total initial target cost, the 
total initial target profit shall be increased. The initial target 
profit shall be increased or decreased by -- percent [see Note 2] of the 
difference between the total initial target cost and the total firm 
target cost. The resulting amount shall be the total firm target profit; 
provided, that in no event shall the total firm target profit be less 
than -- percent or more than -- percent [Contracting Officer insert 
percents] of the total initial target cost.
    (3) If the total firm target cost plus the total firm target profit 
represent a reasonable price for performing that part of the contract 
subject to price revision under this clause, the parties may agree on a 
firm fixed price, which shall be evidenced by a contract modification 
signed by the Contractor and the Contracting Officer.
    (4) Failure of the parties to agree to a firm fixed price shall not 
constitute a dispute under the Disputes clause. If agreement is not 
reached, or if establishment of a firm fixed price is inappropriate, the 
Contractor and the Contracting Officer shall establish a profit 
adjustment formula under which the total final price shall be 
established by applying to the total final negotiated cost an adjustment 
for profit or loss, determined as follows:
    (i) If the total final negotiated cost is equal to the total firm 
target cost, the adjustment is the total firm target profit.
    (ii) If the total final negotiated cost is greater than the total 
firm target cost, the adjustment is the total firm target profit, less 
-- percent of the amount by which the total final negotiated cost 
exceeds the total firm target cost.
    (iii) If the total final negotiated cost is less than the total firm 
target cost, the adjustment is the total firm target profit, plus -- 
percent of the amount by which the total final negotiated cost is less 
than the total firm target cost.
    (iv) The total firm target cost, total firm target profit, and the 
profit adjustment formula for determining final profit shall be 
evidenced by a modification to this contract signed by the Contractor 
and the Contracting Officer.
    (e) Submitting data for final price revision. Unless a firm fixed 
price has been established in accordance with paragraph (d) of this 
section within ---- [Contracting Officer

[[Page 101]]

insert number of days] days after the end of the month in which the 
Contractor has delivered the last unit of supplies and completed the 
services specified by item number in paragraph (a) of this section, the 
Contractor shall submit in the format of table 15-2, FAR 15.408 (or in 
any other form on which the parties agree)--
    (1) A detailed statement of all costs incurred up to the end of that 
month in performing all work under the items;
    (2) An estimate of costs of further performance, if any, that may be 
necessary to complete performance of all work under the items;
    (3) A list of all residual inventory and an estimate of its value; 
and
    (4) Any other relevant data that the Contracting Officer may 
reasonably require.
    (f) Final price revision. Unless a firm fixed price has been agreed 
to in accordance with paragraph (d) above, the Contractor and the 
Contracting Officer shall, promptly after submission of the data 
required by paragraph (e) above, establish the total final price, as 
follows:
    (1) On the basis of the information required by paragraph (e) above, 
together with any other pertinent information, the parties shall 
negotiate the total final cost incurred or to be incurred for the 
supplies delivered (or services performed) and accepted by the 
Government and which are subject to price revision under this clause.
    (2) The total final price shall be established by applying to the 
total final negotiated cost an adjustment for final profit or loss 
determined as agreed upon under subparagraph (d)(4) above.
    (g) Contract modification. The total final price of the items 
specified in paragraph (a) above shall be evidenced by a modification to 
this contract, signed by the Contractor and the Contracting Officer. 
This price shall not be subject to revision, notwithstanding any changes 
in the cost of performing the contract, except to the extent that--
    (1) The parties may agree in writing, before the determination of 
total final price, to exclude specific elements of cost from this price 
and to a procedure for subsequent disposition of these elements; and
    (2) Adjustments or credits are explicitly permitted or required by 
this or any other clause in this contract.
    (h) Adjustment of billing prices. (1) Pending execution of the 
contract modification (see paragraph (e) above), the Contractor shall 
submit invoices or vouchers in accordance with billing prices as 
provided in this paragraph. The billing prices shall be the initial 
target prices shown in this contract until firm target prices are 
established under paragraph (d) above. When established, the firm target 
prices shall be used as the billing prices.
    (2) If at any time it appears from information provided by the 
contractor under subparagraph (i)(1) below that the then-current billing 
prices will be substantially greater than the estimated final prices, 
the parties shall negotiate a reduction in the billing prices. 
Similarly, the parties may negotiate an increase in billing prices by 
any or all of the difference between the target prices and the ceiling 
price, upon the Contractor's submission of factual data showing that the 
final cost under this contract will be substantially greater than the 
target cost.
    (3) Any adjustment of billing prices shall be reflected in a 
contract modification and shall not affect the determination of any 
price under paragraph (d) or (f) above. After the contract modification 
establishing the total final price is executed, the total amount paid or 
to be paid on all invoices or vouchers shall be adjusted to reflect the 
total final price, and any resulting additional payments, refunds, or 
credits shall be made promptly.
    (i) Quarterly limitation on payments statement. This paragraph (i) 
shall apply until a firm fixed price or a total final price is 
established under subparagraph (d)(3) or (f)(2).
    (1) Within 45 days after the end of each quarter of the Contractor's 
fiscal year in which a delivery is first made (or services are first 
performed) and accepted by the Government under this contract, and for 
each quarter thereafter, the Contractor shall submit to the contract 
administration office (with a copy to the contracting office and the 
cognizant contract auditor) a statement, cumulative from the beginning 
of the contract, showing--
    (i) The total contract price of all supplies delivered (or services 
performed) and accepted by the Government and for which final prices 
have been established;
    (ii) The total cost (estimated to the extent necessary) reasonably 
incurred for, and properly allocable solely to, the supplies delivered 
(or services performed) and accepted by the Government and for which 
final prices have not been established;
    (iii) The portion of the total interim profit (used in establishing 
the initial contract price or agreed to for the purpose of this 
paragraph (i)) that is in direct proportion to the supplies delivered 
(or services performed) and accepted by the Government and for which 
final prices have not been established--increased or decreased in 
accordance with subparagraph (d)(4) above when the amount stated under 
subdivision (ii), immediately above, differs from the aggregate firm 
target costs of the supplies or services; and
    (iv) The total amount of all invoices or vouchers for supplies 
delivered (or services performed) and accepted by the Government 
(including amounts applied or to be applied to liquidate progress 
payments).

[[Page 102]]

    (2) Notwithstanding any provision of this contract authorizing 
greater payments, if on any quarterly statement the amount under 
subdivision (1)(iv) above exceeds the sum due the Contractor, as 
computed in accordance with subdivisions (1)(i), (ii), and (iii) above, 
the Contractor shall immediately refund or credit to the Government the 
amount of this excess. The Contractor may, when appropriate, reduce this 
refund or credit by the amount of any applicable tax credits due the 
Contractor under 26 U.S.C. 1481 and by the amount of previous refunds or 
credits effected under this clause. If any portion of the excess has 
been applied to the liquidation of progress payments, then that portion 
may, instead of being refunded, be added to the unliquidated progress 
payment account consistent with the Progress Payments clause. The 
Contractor shall provide complete details to support any claimed 
reductions in refunds.
    (3) If the Contractor fails to submit the quarterly statement within 
45 days after the end of each quarter and it is later determined that 
the Government has overpaid the Contractor, the Contractor shall repay 
the excess to the Government immediately. Unless repaid within 30 days 
after the end of the statement submittal period, the amount of the 
excess shall bear interest, computed from the date the quarterly 
statement was due to the date of repayment, at the rate established in 
accordance with the Interest clause.
    (j) Subcontracts. No subcontract placed under this contract may 
provide for payment on a cost-plus-a-percentage-of-cost basis.
    (k) Disagreements. If the Contractor and the Contracting Officer 
fail to agree upon (1) a total firm target cost and a final profit 
adjustment formula or (2) a total final price, within 60 days (or within 
such other period as the Contracting Officer may specify) after the date 
on which the data required in paragraphs (c) and (e) above are to be 
submitted, the Contracting Officer shall promptly issue a decision in 
accordance with the Disputes clause.
    (l) Termination. If this contract is terminated before the total 
final price is established, prices of supplies or services subject to 
price revision shall be established in accordance with this clause for 
(1) completed supplies and services accepted by the Government and (2) 
those supplies or services not terminated under a partial termination. 
All other elements of the termination shall be resolved in accordance 
with other applicable clauses of this contract.
    (m) Equitable adjustments under other clauses. If an equitable 
adjustment in the contract price is made under any other clause of this 
contract before the total final price is established, the adjustment 
shall be made in the total target cost and may be made in the maximum 
dollar limit on the total final price, the total target profit, or both. 
If the adjustment is made after the total final price is established, 
only the total final price shall be adjusted.
    (n) Exclusion from target price and total final price. If any clause 
of this contract provides that the contract price does not or will not 
include an amount for a specific purpose, then neither any target price 
nor the total final price includes or will include any amount for that 
purpose.
    (o) Separate reimbursement. If any clause of this contract expressly 
provides that the cost of performance of an obligation shall be at 
Government expense, that expense shall not be included in any target 
price or in the total final price, but shall be reimbursed separately.
    (p) Taxes. As used in the Federal, State, and Local Taxes clause or 
in any other clause that provides for certain taxes or duties to be 
included in, or excluded from, the contract price, the term contract 
price includes the total target price or, if it has been established, 
the total final price. When any of these clauses requires that the 
contract price be increased or decreased as a result of changes in the 
obligation of the Contractor to pay or bear the burden of certain taxes 
or duties, the increase or decrease shall be made in the total target 
price or, if it has been established, in the total final price, so that 
it will not affect the Contractor's profit or loss on this contract.

                             (End of clause)

    NOTES: (1) The degree of completion may be based on a percentage of 
contract performance or any other reasonable basis.
    (2) The language may be changed to describe a negotiated adjustment 
pattern under which the extent of adjustment is not the same for all 
levels of cost variation.

    Alternate I (APR 1984). As prescribed in 16.406(b), add the 
following paragraph (q) to the basic clause:

    (q) Provisioning and options. Parts, other supplies, or services 
that are to be furnished under this contract on the basis of a 
provisioning document or Government option shall be subject to price 
revision in accordance with this clause. Any prices established for 
these parts, other supplies, or services under a provisioning document 
or Government option shall be treated as initial target prices, or 
target prices as agreed upon and stipulated in the pricing document 
supporting the provisioning or added items. Initial or firm target costs 
and profits and final prices covering these parts, other supplies, or 
services may be established separately, in

[[Page 103]]

the aggregate, or in any combination, as the parties may agree.

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 67426, Dec. 20, 1996; 
62 FR 12696, Mar. 17, 1997; 62 FR 51265, Sept. 30, 1997]



Sec.  52.216-18  Ordering.

    As prescribed in 16.506(a), insert the following clause:

                           Ordering (OCT 1995)

    (a) Any supplies and services to be furnished under this contract 
shall be ordered by issuance of delivery orders or task orders by the 
individuals or activities designated in the Schedule. Such orders may be 
issued from ------ through ------ [insert dates].
    (b) All delivery orders or task orders are subject to the terms and 
conditions of this contract. In the event of conflict between a delivery 
order or task order and this contract, the contract shall control.
    (c) If mailed, a delivery order or task order is considered 
``issued'' when the Government deposits the order in the mail. Orders 
may be issued orally, by facsimile, or by electronic commerce methods 
only if authorized in the Schedule.

                             (End of clause)

[60 FR 49727, Sept. 26, 1995]



Sec.  52.216-19  Order Limitations.

    As prescribed in 16.506(b), insert a clause substantially the same 
as follows:

                      Order Limitations (OCT 1995)

    (a) Minimum order. When the Government requires supplies or services 
covered by this contract in an amount of less than ---- [insert dollar 
figure or quantity], the Government is not obligated to purchase, nor is 
the Contractor obligated to furnish, those supplies or services under 
the contract.
    (b) Maximum order. The Contractor is not obligated to honor--
    (1) Any order for a single item in excess of ---- [insert dollar 
figure or quantity];
    (2) Any order for a combination of items in excess of ---- [insert 
dollar figure or quantity]; or
    (3) A series of orders from the same ordering office within -- days 
that together call for quantities exceeding the limitation in 
subparagraph (1) or (2) above.
    (c) If this is a requirements contract (i.e., includes the 
Requirements clause at subsection 52.216-21 of the Federal Acquisition 
Regulation (FAR)), the Government is not required to order a part of any 
one requirement from the Contractor if that requirement exceeds the 
maximum-order limitations in paragraph (b) above.
    (d) Notwithstanding paragraphs (b) and (c) above, the Contractor 
shall honor any order exceeding the maximum order limitations in 
paragraph (b), unless that order (or orders) is returned to the ordering 
office within -- days after issuance, with written notice stating the 
Contractor's intent not to ship the item (or items) called for and the 
reasons. Upon receiving this notice, the Government may acquire the 
supplies or services from another source.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 49727, Sept. 26, 1995]



Sec.  52.216-20  Definite Quantity.

    As prescribed in 16.506(c), insert the following clause:

                      Definite Quantity (OCT 1995)

    (a) This is a definite-quantity, indefinite-delivery contract for 
the supplies or services specified, and effective for the period stated, 
in the Schedule.
    (b) The Government shall order the quantity of supplies or services 
specified in the Schedule, and the Contractor shall furnish them when 
ordered. Delivery or performance shall be at locations designated in 
orders issued in accordance with the Ordering clause and the Schedule.
    (c) Except for any limitations on quantities in the Order 
Limitations clause or in the Schedule, there is no limit on the number 
of orders that may be issued. The Government may issue orders requiring 
delivery to multiple destinations or performance at multiple locations.
    (d) Any order 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 contract shall govern the 
Contractor's and Government's rights and obligations with respect to 
that order to the same extent as if the order were completed during the 
contract's effective period; provided, that the Contractor shall not be 
required to make any deliveries under this contract after ---- [insert 
date].

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 49727, Sept. 26, 1995]



Sec.  52.216-21  Requirements.

    As prescribed in 16.506(d), insert the following clause:

[[Page 104]]

                         Requirements (OCT 1995)

    (a) This is a requirements contract for the supplies or services 
specified, and effective for the period stated, in the Schedule. The 
quantities of supplies or services specified in the Schedule are 
estimates only and are not purchased by this contract. Except as this 
contract may otherwise provide, if the Government's requirements do not 
result in orders in the quantities described as estimated or maximum in 
the Schedule, that fact shall not constitute the basis for an equitable 
price adjustment.
    (b) Delivery or performance shall be made only as authorized by 
orders issued in accordance with the Ordering clause. Subject to any 
limitations in the Order Limitations clause or elsewhere in this 
contract, the Contractor shall furnish to the Government all supplies or 
services specified in the Schedule and called for by orders issued in 
accordance with the Ordering clause. The Government may issue orders 
requiring delivery to multiple destinations or performance at multiple 
locations.
    (c) Except as this contract otherwise provides, the Government shall 
order from the Contractor all the supplies or services specified in the 
Schedule that are required to be purchased by the Government activity or 
activities specified in the Schedule.
    (d) The Government is not required to purchase from the Contractor 
requirements in excess of any limit on total orders under this contract.
    (e) If the Government urgently requires delivery of any quantity of 
an item before the earliest date that delivery may be specified under 
this contract, and if the Contractor will not accept an order providing 
for the accelerated delivery, the Government may acquire the urgently 
required goods or services from another source.
    (f) Any order issued during the effective period of this contract 
and not completed within that period shall be completed by the 
Contractor within the time specified in the order. The contract shall 
govern the Contractor's and Government's rights and obligations with 
respect to that order to the same extent as if the order were completed 
during the contract's effective period; provided, that the Contractor 
shall not be required to make any deliveries under this contract after 
---- [insert date].

                             (End of clause)

    Alternate I (APR 1984). If the requirements contract is for 
nonpersonal services and related supplies and covers estimated 
requirements that exceed a specific Government activity's internal 
capability to produce or perform, substitute the following paragraph (c) 
for paragraph (c) of the basic clause:

    (c) The estimated quantities are not the total requirements of the 
Government activity specified in the Schedule, but are estimates of 
requirements in excess of the quantities that the activity may itself 
furnish within its own capabilities. Except as this contract otherwise 
provides, the Government shall order from the Contractor all of that 
activity's requirements for supplies and services specified in the 
Schedule that exceed the quantities that the activity may itself furnish 
within its own capabilities.

    Alternate II (APR 1984). If the requirements contract includes 
subsistence for both Government use and resale in the same Schedule, and 
similar products may be acquired on a brand-name basis, add the 
following paragraph (g) to the basic clause:

    (g) The requirements referred to in this contract are for items to 
be manufactured according to Government specifications. Notwithstanding 
anything to the contrary stated in the contract, the Government may 
acquire similar products by brand name from other sources for resale.

    Alternate III (OCT 1995). If the requirements contract involves a 
partial small business set-aside, substitute the following paragraph (c) 
for paragraph (c) of the basic clause:

    (c) The Government's requirements for each item or subitem of 
supplies or services described in the Schedule are being purchased 
through one non-set-aside contract and one set-aside contract. 
Therefore, the Government shall order from each Contractor approximately 
one-half of the total supplies or services specified in the Schedule 
that are required to be purchased by the specified Government activity 
or activities. The Government may choose between the set-aside 
Contractor and the non-set-aside Contractor in placing any particular 
order. However, the Government shall allocate successive orders, in 
accordance with its delivery requirements, to maintain as close a ratio 
as is reasonably practicable between the total quantities ordered from 
the two Contractors.

    Alternate IV (OCT 1995). If the contract includes subsistence for 
both Government use and resale in the same Schedule and similar products 
may be acquired on a brand-name basis and the contract also involves a 
partial small business set-aside, substitute the following paragraph (c) 
for paragraph (c) of the basic clause and add the following paragraph 
(g) to the basic clause:


[[Page 105]]


    (c) The Government's requirements for each item or subitem of 
supplies or services described in the Schedule are being purchased 
through one non-set-aside contract and one set-aside contract. 
Therefore, the Government shall order from each Contractor approximately 
one-half of the total supplies or services specified in the Schedule 
that are required to be purchased by the specified Government activity 
or activities. The Government may choose between the set-aside 
Contractor and the non-set-aside Contractor in placing any particular 
order. However, the Government shall allocate successive orders, in 
accordance with its delivery requirements, to maintain as close a ratio 
as is reasonably practicable between the total quantities ordered from 
the two Contractors.
    (g) The requirements referred to in this contract are for items to 
be manufactured according to the Government specifications. 
Notwithstanding anything to the contrary stated in the contract, the 
Government may acquire similar products by brand name from other sources 
for resale.

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 48264, Sept. 18, 1995; 
60 FR 49727, Sept. 26, 1995]



Sec.  52.216-22  Indefinite Quantity.

    As prescribed in 16.506(e), insert the following clause:

                     Indefinite Quantity (OCT 1995)

    (a) This is an indefinite-quantity contract for the supplies or 
services specified, and effective for the period stated, in the 
Schedule. The quantities of supplies and services specified in the 
Schedule are estimates only and are not purchased by this contract.
    (b) Delivery or performance shall be made only as authorized by 
orders issued in accordance with the Ordering clause. The Contractor 
shall furnish to the Government, when and if ordered, the supplies or 
services specified in the Schedule up to and including the quantity 
designated in the Schedule as the maximum. The Government shall order at 
least the quantity of supplies or services designated in the Schedule as 
the minimum.
    (c) Except for any limitations on quantities in the Order 
Limitations clause or in the Schedule, there is no limit on the number 
of orders that may be issued. The Government may issue orders requiring 
delivery to multiple destinations or performance at multiple locations.
    (d) Any order issued during the effective period of this contract 
and not completed within that period shall be completed by the 
Contractor within the time specified in the order. The contract shall 
govern the Contractor's and Government's rights and obligations with 
respect to that order to the same extent as if the order were completed 
during the contract's effective period; provided, that the Contractor 
shall not be required to make any deliveries under this contract after 
---- [insert date].

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 38518, Sept. 18, 1990; 
60 FR 49727, Sept. 26, 1995]



Sec.  52.216-23  Execution and Commencement of Work.

    As prescribed in 16.603-4(b)(1), insert the following clause in 
solicitations and contracts when a letter contract is contemplated, 
except that it may be omitted from letter contracts awarded on SF 26:

              Execution and Commencement of Work (APR 1984)

    The Contractor shall indicate acceptance of this letter contract by 
signing three copies of the contract and returning them to the 
Contracting Officer not later than ---- [insert date]. Upon acceptance 
by both parties, the Contractor shall proceed with performance of the 
work, including purchase of necessary materials.

                             (End of clause)



Sec.  52.216-24  Limitation of Government Liability.

    As prescribed in 16.603-4(b)(2), insert the following clause in 
solicitations and contracts when a letter contract is contemplated:

              Limitation of Government Liability (APR 1984)

    (a) In performing this contract, the Contractor is not authorized to 
make expenditures or incur obligations exceeding ---- dollars.
    (b) The maximum amount for which the Government shall be liable if 
this contract is terminated is ---- dollars.

                             (End of clause)



Sec.  52.216-25  Contract Definitization.

    As prescribed in 16.603-4(b)(3), insert the following clause:

                   Contract Definitization (OCT 1997)

    (a) A ---- [insert specific type of contract] definitive contract is 
contemplated. The Contractor agrees to begin promptly negotiating with 
the Contracting Officer the terms of a definitive contract that will 
include (1) all

[[Page 106]]

clauses required by the Federal Acquisition Regulation (FAR) on the date 
of execution of the letter contract, (2) all clauses required by law on 
the date of execution of the definitive contract, and (3) any other 
mutually agreeable clauses, terms, and conditions. The Contractor agrees 
to submit a ---- [insert specific 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 [insert target 
date for definitization of the contract and dates for submission of 
proposal, beginning of negotiations, and, if appropriate, submission of 
make-or-buy and subcontracting plans and cost or pricing data]:
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
    (c) If agreement on a definitive contract to supersede this letter 
contract is not reached by the target date in paragraph (b) above, 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 15.4 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 
letter contract 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 subparagraph (c)(1) above, all 
clauses, terms, and conditions included in this letter contract shall 
continue in effect, except those that by their nature apply only to a 
letter contract.

                             (End of clause)

    Alternate I (APR 1984). In letter contracts awarded on the basis of 
price competition, add the following paragraph (d) to the basic clause:

    (d) The definitive contract resulting from this letter contract will 
include a negotiated ---- [insert price ceiling or firm fixed price] in 
no event to exceed ---- [insert the proposed price upon which the award 
was based].

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 48221, Sept. 18, 1995; 
62 FR 51271, Sept. 30, 1997]



Sec.  52.216-26  Payments of Allowable Costs Before Definitization.

    As prescribed in 16.603-4(c), insert the following clause:

      Payments of Allowable Costs Before Definitization (DEC 2002)

    (a) Reimbursement rate. Pending the placing of the definitive 
contract referred to in this letter contract, the Government will 
promptly reimburse the Contractor for all allowable costs under this 
contract at the following rates:
    (1) One hundred percent of approved costs representing financing 
payments to subcontractors under fixed-price subcontracts, provided that 
the Government's payments to the Contractor will not exceed 80 percent 
of the allowable costs of those subcontractors.
    (2) One hundred percent of approved costs representing cost-
reimbursement subcontracts; provided, that the Government's payments to 
the Contractor shall not exceed 85 percent of the allowable costs of 
those subcontractors.
    (3) Eighty-five percent of all other approved costs.
    (b) Limitation of reimbursement. To determine the amounts payable to 
the Contractor under this letter contract, the Contracting Officer shall 
determine allowable costs in accordance with the applicable cost 
principles in part 31 of the Federal Acquisition Regulation (FAR). The 
total reimbursement made under this paragraph shall not exceed 85 
percent of the maximum amount of the Government's liability, as stated 
in this contract.
    (c) Invoicing. Payments shall be made promptly to the Contractor 
when requested as work progresses, but (except for small business 
concerns) not more often than every 2 weeks, in amounts approved by the 
Contracting Officer. The Contractor may submit to an authorized 
representative of the Contracting Officer, in such form and reasonable 
detail as the representative may require, an invoice or voucher 
supported by a statement of the claimed allowable cost incurred by the 
Contractor in the performance of this contract.
    (d) Allowable costs. For the purpose of determining allowable costs, 
the term costs includes--
    (1) Those recorded costs that result, at the time of the request for 
reimbursement, from payment by cash, check, or other form of actual 
payment for items or services purchased directly for the contract;

[[Page 107]]

    (2) When the Contractor is not delinquent in payment of costs of 
contract performance in the ordinary course of business, costs incurred, 
but not necessarily paid, for--
    (i) Supplies and services purchased directly for the contract and 
associated financing payments to subcontractors, provided payments 
determined due will be made--
    (A) In accordance with the terms and conditions of a subcontract or 
invoice; and
    (B) Ordinarily within 30 days of the submission of the Contractor's 
payment request to the Government;
    (ii) Materials issued from the Contractor's stores inventory and 
placed in the production process for use on the contract;
    (iii) Direct labor;
    (iv) Direct travel;
    (v) Other direct in-house costs; and
    (vi) Properly allocable and allowable indirect costs as shown on the 
records maintained by the Contractor for purposes of obtaining 
reimbursement under Government contracts; and
    (3) The amount of financing payments that the Contractor has paid by 
cash, check, or other forms of payment to subcontractors.
    (e) Small business concerns. A small business concern may receive 
more frequent payments than every 2 weeks.
    (f) Audit. At any time before final payment, the Contracting Officer 
may have the Contractor's invoices or vouchers and statements of costs 
audited. Any payment may be (1) reduced by any amounts found by the 
Contracting Officer not to constitute allowable costs or (2) adjusted 
for overpayments or underpayments made on preceding invoices or 
vouchers.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 65 FR 16283, Mar. 27, 2000; 
67 FR 70521, Nov. 22, 2002]



Sec.  52.216-27  Single or Multiple Awards.

    As prescribed in 16.506(f), insert the following provision:

                  Single or Multiple Awards (OCT 1995)

    The Government may elect to award a single delivery order contract 
or task order contract or to award multiple delivery order contracts or 
task order contracts for the same or similar supplies or services to two 
or more sources under this solicitation.

                           (End of provision)

[60 FR 49727, Sept. 26, 1995]



Sec.  52.216-28  Multiple Awards for Advisory and Assistance Services.

    As prescribed in 16.506(g), insert the following provision:

     Multiple Awards for Advisory and Assistance Services (OCT 1995)

    The Government intends to award multiple contracts for the same or 
similar advisory and assistance services to two or more sources under 
this solicitation unless the Government determines, after evaluation of 
offers, that only one offeror is capable of providing the services at 
the level of quality required.

                           (End of provision)

[60 FR 49728, Sept. 26, 1995]



Sec.  52.217-1  [Reserved]



Sec.  52.217-2  Cancellation Under Multiyear Contracts.

    As prescribed in 17.109(a), insert the following clause:

            Cancellation Under Multiyear Contracts (OCT 1997)

    (a) Cancellation, as used in this clause, means that the Government 
is canceling its requirements for all supplies or services in program 
years subsequent to that in which notice of cancellation is provided. 
Cancellation shall occur by the date or within the time period specified 
in the Schedule, unless a later date is agreed to, if the Contracting 
Officer (1) notifies the Contractor that funds are not available for 
contract performance for any subsequent program year, or (2) fails to 
notify the Contractor that funds are available for performance of the 
succeeding program year requirement.
    (b) Except for cancellation under this clause or termination under 
the Default clause, any reduction by the Contracting Officer in the 
requirements of this contract shall be considered a termination under 
the Termination for Convenience of the Government clause.
    (c) If cancellation under this clause occurs, the Contractor will be 
paid a cancellation charge not over the cancellation ceiling specified 
in the Schedule as applicable at the time of cancellation.
    (d) The cancellation charge will cover only (1) costs (i) incurred 
by the Contractor and/or subcontractor, (ii) reasonably necessary for 
performance of the contract, and (iii) that would have been equitably 
amortized over the entire multiyear contract period but, because of the 
cancellation, are not so amortized, and (2) a reasonable profit or fee 
on the costs.

[[Page 108]]

    (e) The cancellation charge shall be computed and the claim made for 
it as if the claim were being made under the Termination for Convenience 
of the Government clause of this contract. The Contractor shall submit 
the claim promptly but no later than 1 year from the date (1) of 
notification of the nonavailability of funds, or (2) specified in the 
Schedule by which notification of the availability of additional funds 
for the next succeeding program year is required to be issued, whichever 
is earlier, unless extensions in writing are granted by the Contracting 
Officer.
    (f) The Contractor's claim may include--
    (1) Reasonable nonrecurring costs (see Subpart 15.4 of the Federal 
Acquisition Regulation) which are applicable to and normally would have 
been amortized in all supplies or services which are multiyear 
requirements;
    (2) Allocable portions of the costs of facilities acquired or 
established for the conduct of the work, to the extent that it is 
impracticable for the Contractor to use the facilities in its commercial 
work, and if the costs are not charged to the contract through overhead 
or otherwise depreciated;
    (3) Costs incurred for the assembly, training, and transportation to 
and from the job site of a specialized work force; and
    (4) Costs not amortized solely because the cancellation had 
precluded anticipated benefits of Contractor or subcontractor learning.
    (g) The claim shall not include--
    (1) Labor, material, or other expenses incurred by the Contractor or 
subcontractors for performance of the canceled work;
    (2) Any cost already paid to the Contractor;
    (3) Anticipated profit or unearned fee on the canceled work; or
    (4) For service contracts, the remaining useful commercial life of 
facilities. Useful commercial life means the commercial utility of the 
facilities rather than their physical life with due consideration given 
to such factors as location of facilities, their specialized nature, and 
obsolescence.
    (h) This contract may include an Option clause with the period for 
exercising the option limited to the date in the contract for 
notification that funds are available for the next succeeding program 
year. If so, the Contractor agrees not to include in option quantities 
any costs of a startup or nonrecurring nature that have been fully set 
forth in the contract. The Contractor further agrees that the option 
quantities will reflect only those recurring costs and a reasonable 
profit or fee necessary to furnish the additional option quantities.
    (i) Quantities added to the original contract through the Option 
clause of this contract shall be included in the quantity canceled for 
the purpose of computing allowable cancellation charges.

                             (End of clause)

[61 FR 39207, July 26, 1996, as amended at 62 FR 51271, Sept. 30, 1997]



Sec.  52.217-3  Evaluation Exclusive of Options.

    As prescribed in 17.208(a), insert a provision substantially the 
same as the following in solicitations when the solicitation includes an 
option clause and does not include one of the provisions prescribed in 
17.208 (b) or (c):

               Evaluation Exclusive of Options (ACT 1984)

    The Government will evaluate offers for award purposes by including 
only the price for the basic requirement; i.e., options will not be 
included in the evaluation for award purposes.

                           (End of provision)



Sec.  52.217-4  Evaluation of Option Exercised at Time of Contract Award.

    As prescribed in 17.208(b), insert a provision substantially the 
same as the following:

  Evaluation of Options Exercised at Time of Contract Award (JUN 1988)

    Except when it is determined in accordance with FAR 17.206(b) not to 
be in the Government's best interests, the Government will evaluate the 
total price for the basic requirement together with any option(s) 
exercised at the time of award.

                           (End of provision)

[53 FR 17860, May 18, 1988]



Sec.  52.217-5  Evaluation of Options.

    As prescribed in 17.208(c)(1), insert a provision substantially the 
same as the following:

                    Evaluation of Options (JUL 1990)

    Except when it is determined in accordance with FAR 17.206(b) not to 
be in the Government's best interests, the Government will evaluate 
offers for award purposes by adding the total price for all options to 
the total price for the basic requirement. Evaluation of options will 
not obligate the Government to exercise the option(s).

                           (End of provision)

[53 FR 17860, May 18, 1988, as amended at 55 FR 25532, June 21, 1990]

[[Page 109]]



Sec.  52.217-6  Option for Increased Quantity.

    As prescribed in 17.208(d), insert a clause substantially the same 
as the following:

                Option for Increased Quantity (MAR 1989)

    The Government may increase the quantity of supplies called for in 
the Schedule at the unit price specified. The Contracting Officer may 
exercise the option by written notice to the Contractor within ---- 
[insert in the clause the period of time in which the Contracting 
Officer has to exercise the option]. Delivery of the added items shall 
continue at the same rate as the like items called for under the 
contract, unless the parties otherwise agree.

                             (End of clause)

[54 FR 5058, Jan. 31, 1989]



Sec.  52.217-7  Option for Increased Quantity--Separately Priced Line Item.

    As prescribed in 17.208(e), insert a clause substantially the same 
as the following:

  Option for Increased Quantity--Separately Priced Line Item (MAR 1989)

    The Government may require the delivery of the numbered line item, 
identified in the Schedule as an option item, in the quantity and at the 
price stated in the Schedule. The Contracting Officer may exercise the 
option by written notice to the Contractor within ---- [insert in the 
clause the period of time in which the Contracting Officer has to 
exercise the option]. Delivery of added items shall continue at the same 
rate that like items are called for under the contract, unless the 
parties otherwise agree.

                             (End of clause)

[54 FR 5058, Jan. 31, 1989]



Sec.  52.217-8  Option to Extend Services.

    As prescribed in 17.208(f), insert a clause substantially the same 
as the following:

                  Option to Extend Services (NOV 1999)

    The Government may require continued performance of any services 
within the limits and at the rates specified in the contract. These 
rates may be adjusted only as a result of revisions to prevailing labor 
rates provided by the Secretary of Labor. The option provision may be 
exercised more than once, but the total extention of performance 
hereunder shall not exceed 6 months. The Contracting Officer may 
exercise the option by written notice to the Contractor within-- [insert 
the period of time within which the Contracting Officer may exercise the 
option].

                             (End of clause)

[54 FR 29283, July 11, 1989, as amended at 64 51843, Sept. 24, 1999]



Sec.  52.217-9  Option to Extend the Term of the Contract.

    As prescribed in 17.208(g), insert a clause substantially the same 
as the following:

          Option to Extend the Term of the Contract (MAR 2000)

    (a) The Government may extend the term of this contract by written 
notice to the Contractor within -- [insert the period of time within 
which the Contracting Officer may exercise the option]; provided that 
the Government gives the Contractor a preliminary written notice of its 
intent to extend at least -- days [60 days unless a different number of 
days is inserted] before the contract expires. The preliminary notice 
does not commit the Government to an extension.
    (b) If the Government exercises this option, the extended contract 
shall be considered to include this option clause.
    (c) The total duration of this contract, including the exercise of 
any options under this clause, shall not exceed -- (months) (years).

                             (End of clause)

[54 FR 5058, Jan. 31, 1989, as amended at 64 FR 51843, Sept. 24, 1999; 
65 FR 16286, Mar. 27, 2000]



Sec.  52.218  [Reserved]



Sec.  52.219-1  Small Business Program Representations.

    As prescribed in 19.307(a)(1), insert the following provision:

            Small Business Program Representations (APR 2002)

    (a)(1) The North American Industry Classification System (NAICS) 
code for this acquisition is--[insert NAICS code].
    (2) The small business size standard is -------- (insert size 
standard).
    (3) The small business size standard for a concern which submits an 
offer in its own name, other than on a construction or service contract, 
but which proposes to furnish a product which it did not itself 
manufacture, is 500 employees.

[[Page 110]]

    (b) Representations. (1) The offeror represents as part of its offer 
that it [squ] is, [squ] is not a small business concern.
    (2) (Complete only if the offeror represented itself as a small 
business concern in paragraph (b)(1) of this provision.) The offeror 
represents, for general statistical purposes, that it [squ] is, [squ] is 
not, a small disadvantaged business concern as defined in 13 CFR 
124.1002.
    (3) (Complete only if the offeror represented itself as a small 
business concern in paragraph (b)(1) of this provision.) The offeror 
represents as part of its offer that it [squ] is, [squ] is not a women-
owned small business concern.
    (4) [Complete only if the offeror represented itself as a small 
business concern in paragraph (b)(1) of this provision.] The offeror 
represents as part of its offer that it [ ] is, [ ] is not a veteran-
owned small business concern.
    (5) [Complete only if the offeror represented itself as a veteran-
owned small business concern in paragraph (b)(4) of this provision.] The 
offeror represents as part of its offer that it [ ] is, [ ] is not a 
service-disabled veteran-owned small business concern.
    (6) [Complete only if the offeror represented itself as a small 
business concern in paragraph (b)(1) of this provision.] The offeror 
represents, as part of its offer, that--
    (i) It [ ] is, [ ] is not a HUBZone small business concern listed, 
on the date of this representation, on the List of Qualified HUBZone 
Small Business Concerns maintained by the Small Business Administration, 
and no material change in ownership and control, principal office, or 
HUBZone employee percentage has occurred since it was certified by the 
Small Business Administration in accordance with 13 CFR part 126; and
    (ii) It [ ] is, [ ] is not a joint venture that complies with the 
requirements of 13 CFR part 126, and the representation in paragraph 
(b)(6)(i) of this provision is accurate for the HUBZone small business 
concern or concerns that are participating in the joint venture. [The 
offeror shall enter the name or names of the HUBZone small business 
concern or concerns that are participating in the joint venture:--------
----.] Each HUBZone small business concern participating in the joint 
venture shall submit a separate signed copy of the HUBZone 
representation.
    (c) Definitions. As used in this provision--
    Service-disabled veteran-owned small business concern--
    (1) Means a small business concern--
    (i) Not less than 51 percent of which is owned by one or more 
service-disabled veterans or, in the case of any publicly owned 
business, not less than 51 percent of the stock of which is owned by one 
or more service-disabled veterans; and
    (ii) The management and daily business operations of which are 
controlled by one or more service-disabled veterans or, in the case of a 
veteran with permanent and severe disability, the spouse or permanent 
caregiver of such veteran.
    (2) Service-disabled veteran means a veteran, as defined in 38 
U.S.C. 101(2), with a disability that is service-connected, as defined 
in 38 U.S.C. 101(16).
    Small business concern 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 criteria in 13 CFR part 121 and the size 
standard in paragraph (a) of this provision.
    Veteran-owned small business concern means a small business 
concern--
    (1) Not less than 51 percent of which is owned by one or more 
veterans (as defined at 38 U.S.C. 101(2)) or, in the case of any 
publicly owned business, not less than 51 percent of the stock of which 
is owned by one or more veterans; and
    (2) The management and daily business operations of which are 
controlled by one or more veterans.
    Women-owned small business concern means a small business concern--
    (1) That is at least 51 percent owned by one or more women; or, in 
the case of any publicly owned business, at least 51 percent of the 
stock of which is owned by one or more women; and
    (2) Whose management and daily business operations are controlled by 
one or more women.
    (d) Notice. (1) If this solicitation is for supplies and has been 
set aside, in whole or in part, for small business concerns, then the 
clause in this solicitation providing notice of the set-aside contains 
restrictions on the source of the end items to be furnished.
    (2) Under 15 U.S.C. 645(d), any person who misrepresents a firm's 
status as a small, HUBZone small, small disadvantaged, or women-owned 
small business concern in order to obtain a contract to be awarded under 
the preference programs established pursuant to section 8(a), 8(d), 9, 
or 15 of the Small Business Act or any other provision of Federal law 
that specifically references section 8(d) for a definition of program 
eligibility, shall--
    (i) Be punished by imposition of fine, imprisonment, or both;
    (ii) Be subject to administrative remedies, including suspension and 
debarment; and
    (iii) Be ineligible for participation in programs conducted under 
the authority of the Act.

                           (End of provision)

    Alternate I (Oct 2002). As prescribed in 19.307(a)(2), add the 
following paragraph (b)(7) to the basic provision:


[[Page 111]]


    (7) [Complete if offeror represented itself as disadvantaged in 
paragraph (b)(2) of this provision.] The offeror shall check the 
category in which its ownership falls:
    ---- Black American.
    ---- Hispanic American.
    ---- Native American (American Indians, Eskimos, Aleuts, or Native 
Hawaiians).
    ---- Asian-Pacific American (persons with origins from Burma, 
Thailand, Malaysia, Indonesia, Singapore, Brunei, Japan, China, Taiwan, 
Laos, Cambodia (Kampuchea), Vietnam, Korea, The Philippines, U.S. Trust 
Territory of the Pacific Islands (Republic of Palau), Republic of the 
Marshall Islands, Federated States of Micronesia, the Commonwealth of 
the Northern Mariana Islands, Guam, Samoa, Macao, Hong Kong, Fiji, 
Tonga, Kiribati, Tuvalu, or Nauru).
    ---- Subcontinent Asian (Asian-Indian) American (persons with 
origins from India, Pakistan, Bangladesh, Sri Lanka, Bhutan, the 
Maldives Islands, or Nepal).
    ---- Individual/concern, other than one of the preceding.

[60 FR 48264, Sept. 18, 1995, as amended at 61 FR 67422, Dec. 20, 1996; 
62 FR 238, Jan. 2, 1997; 63 FR 9069, Feb. 23, 1998; 63 FR 35725, June 
30, 1998; 63 FR 70274, Dec. 18, 1998; 64 FR 10533, Mar. 4, 1999; 64 FR 
32749, June 17, 1999; 64 FR 51832, Sept. 24, 1999; 65 FR 46058, July 26, 
2000; 65 FR 60546, Oct. 11, 2000; 66 FR 2134, Jan. 10, 2001; 67 FR 
13066, Mar. 20, 2002]



Sec.  52.219-2  Equal Low Bids.

    As prescribed in 19.307(c), insert the following provision:

                        Equal Low Bids (OCT 1995)

    (a) This provision applies to small business concerns only.
    (b) The bidder's status as a labor surplus area (LSA) concern may 
affect entitlement to award in case of tie bids. If the bidder wishes to 
be considered for this priority, the bidder must identify, in the 
following space, the LSA in which the costs to be incurred on account of 
manufacturing or production (by the bidder or the first-tier 
subcontractors) amount to more than 50 percent of the contract price.
________________________________________________________________________

________________________________________________________________________
    (c) Failure to identify the labor surplus areas as specified in 
paragraph (b) of this provision will preclude the bidder from receiving 
priority consideration. If the bidder is awarded a contract as a result 
of receiving priority consideration under this provision and would not 
have otherwise received award, the bidder shall perform the contract or 
cause the contract to be performed in accordance with the obligations of 
an LSA concern.

                           (End of provision)

[60 FR 48265, Sept. 18, 1995, as amended at 63 FR 35725, June 30, 1998; 
63 FR 70274, Dec. 18, 1998]



Sec.  52.219-3  Notice of total HUBZone set-aside.

    As prescribed in 19.1308(a), insert the following clause:

              Notice of Total HUBZone Set-Aside (JAN 1999)

    (a) Definition. HUBZone small business concern, as used in this 
clause, means a small business concern that appears on the List of 
Qualified HUBZone Small Business Concerns maintained by the Small 
Business Administration.
    (b) General. (1) Offers are solicited only from HUBZone small 
business concerns. Offers received from concerns that are not HUBZone 
small business concerns shall not be considered.
    (2) Any award resulting from this solicitation will be made to a 
HUBZone small business concern.
    (c) Agreement. A HUBZone small business concern agrees that in the 
performance of the contract, in the case of a contract for--
    (1) Services (except construction), at least 50 percent of the cost 
of personnel for contract performance will be spent for employees of the 
concern or employees of other HUBZone small business concerns;
    (2) Supplies (other than acquisition from a nonmanufacturer of the 
supplies), at least 50 percent of the cost of manufacturing, excluding 
the cost of materials, will be performed by the concern or other HUBZone 
small business concerns;
    (3) General construction, at least 15 percent of the cost of the 
contract performance incurred for personnel will be spent on the 
concern's employees or the employees of other HUBZone small business 
concerns; or
    (4) Construction by special trade contractors, at least 25 percent 
of the cost of the contract performance incurred for personnel will be 
spent on the concern's employees or the employees of other HUBZone small 
business concerns.
    (d) A HUBZone joint venture agrees that, in the performance of the 
contract, the applicable percentage specified in paragraph (c) of this 
clause will be performed by the HUBZone small business participant or 
participants.
    (e) A HUBZone small business concern nonmanufacturer agrees to 
furnish in performing this contract only end items manufactured or 
produced by HUBZone small business manufacturer concerns. This paragraph 
does not apply in connection with construction or service contracts.

[[Page 112]]

                             (End of clause)

[63 FR 70274, Dec. 18, 1998]



Sec.  52.219-4  Notice of price evaluation preference for HUBZone small 
business concerns.

    As prescribed in 19.1308(b), insert the following clause:

    Notice of Price Evaluation Preference for HUBZone Small Business 
                           Concerns (JAN 1999)

    (a) Definition. HUBZone small business concern, as used in this 
clause, means a small business concern that appears on the List of 
Qualified HUBZone Small Business Concerns maintained by the Small 
Business Administration.
    (b) Evaluation preference. (1) Offers will be evaluated by adding a 
factor of 10 percent to the price of all offers, except--
    (i) Offers from HUBZone small business concerns that have not waived 
the evaluation preference;
    (ii) Otherwise successful offers from small business concerns;
    (iii) Otherwise successful offers of eligible products under the 
Trade Agreements Act when the dollar threshold for application of the 
Act is exceeded (see 25.402 of the Federal Acquisition Regulation 
(FAR)); and
    (iv) Otherwise successful offers where application of the factor 
would be inconsistent with a Memorandum of Understanding or other 
international agreement with a foreign government.
    (2) The factor of 10 percent shall be applied on a line item basis 
or to any group of items on which award may be made. Other evaluation 
factors described in the solicitation shall be applied before 
application of the factor.
    (3) A concern that is both a HUBZone small business concern and a 
small disadvantaged business concern will receive the benefit of both 
the HUBZone small business price evaluation preference and the small 
disadvantaged business price evaluation adjustment (see FAR clause 
52.219-23). Each applicable price evaluation preference or adjustment 
shall be calculated independently against an offeror's base offer.
    These individual preference amounts shall be added together to 
arrive at the total evaluated price for that offer.
    (c) Waiver of evaluation preference. A HUBZone small business 
concern may elect to waive the evaluation preference, in which case the 
factor will be added to its offer for evaluation purposes. The 
agreements in paragraph (d) of this clause do not apply if the offeror 
has waived the evaluation preference.
    [squ] Offeror elects to waive the evaluation preference.
    (d) Agreement. A HUBZone small business concern agrees that in the 
performance of the contract, in the case of a contract for
    (1) Services (except construction), at least 50 percent of the cost 
of personnel for contract performance will be spent for employees of the 
concern or employees of other HUBZone small business concerns;
    (2) Supplies (other than procurement from a nonmanufacturer of such 
supplies), at least 50 percent of the cost of manufacturing, excluding 
the cost of materials, will be performed by the concern or other HUBZone 
small business concerns;
    (3) General construction, at least 15 percent of the cost of the 
contract performance incurred for personnel will be will be spent on the 
concern's employees or the employees of other HUBZone small business 
concerns; or
    (4) Construction by special trade contractors, at least 25 percent 
of the cost of the contract performance incurred for personnel will be 
spent on the concern's employees or the employees of other HUBZone small 
business concerns.
    (e) A HUBZone joint venture agrees that in the performance of the 
contract, the applicable percentage specified in paragraph (d) of this 
clause will be performed by the HUBZone small business participant or 
participants.
    (f) A HUBZone small business concern nonmanufacturer agrees to 
furnish in performing this contract only end items manufactured or 
produced by HUBZone small business manufacturer concerns. This paragraph 
does not apply in connection with construction or service contracts.

                             End of clause)

[63 FR 70275, Dec. 18, 1998]



Sec.  52.219-5  Very small business set-aside.

    As prescribed in 19.905, insert the following clause:

                Very Small Business Set-Aside (June 2003)

    (a) Definition. Very Small Business Concern, as used in this clause, 
means a concern whose headquarters is located within the geographical 
area served by a designated SBA district (see 13 CFR 125.7(b)); which, 
together with its affiliates, has no more than 15 employees and has 
average annual receipts that do not exceed $1 million.
    (b) Eligibility. (1) Only those firms headquartered in the --------
------------------------ Small Business Administration (SBA) district 
[Contracting Officer shall insert the applicable SBA designated 
district. If the geographic area is served by the SBA Los Angeles or 
Santa Ana District offices, list both] are eligible for this 
acquisition.

[[Page 113]]

    (2) Offers or quotations under this acquisition are solicited from 
very small business concerns only. Offers that are from other than an 
eligible very small business concern shall not be considered and shall 
be rejected. The offeror represents that it is an eligible very small 
business concern by submission of an offer or quotation.
    (c) Agreement. A very small business concern submitting an offer in 
its own name shall furnish, in performing the contract, only end items 
manufactured or produced by small business concerns in the United States 
or its outlying areas.

                             (End of clause)

    Alternate I (Mar 1999). As prescribed in 19.905(a), delete paragraph 
(c) of the basic clause.
    Alternate II (June 2003). As prescribed in 19.905(b), substitute the 
following paragraph (c) for paragraph (c) of the basic clause:
    (c) Agreement. A very small business concern submitting an offer in 
its own name shall furnish, in performing the contract, only end items 
manufactured or produced by domestic firms in the United States or its 
outlying areas.

[64 FR 10537, Mar. 4, 1999, as ameded at 68 FR 28085, May 22, 2003]



Sec.  52.219-6  Notice of Total Small Business Set-Aside.

    As prescribed in 19.508(c), insert the following clause:

          Notice of Total Small Business Set-Aside (June 2003)

    (a) Definition.
    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.
    (b) General. (1) Offers are solicited only from small business 
concerns. Offers received from concerns that are not small business 
concerns shall be considered nonresponsive and will be rejected.
    (2) Any award resulting from this solicitation will be made to a 
small business concern.
    (c) Agreement. A small business concern submitting an offer in its 
own name shall furnish, in performing the contract, only end items 
manufactured or produced by small business concerns in the United States 
or its outlying areas. If this procurement is processed under simplified 
acquisition procedures and the total amount of this contract does not 
exceed $25,000, a small business concern may furnish the product of any 
domestic firm. This paragraph does not apply to construction or service 
contracts.

                             (End of clause)

    Alternate I (OCT 1995). When the acquisition is for a product in a 
class for which the Small Business Administration has determined that 
there are no small business manufacturers or processors in the Federal 
market in accordance with 19.502-2(c), delete paragraph (c).

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 25069, June 12, 1989; 
60 FR 48265, Sept. 18, 1995; 61 FR 39209, July 26, 1996; 68 FR 28085, 
May 22, 2003]



Sec.  52.219-7  Notice of Partial Small Business Set-Aside.

    As prescribed in 19.508(d), insert the following clause:

         Notice of Partial Small Business Set-Aside (June 2003)

    (a) Definitions.
    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.
    (b) General. (1) A portion of this requirement, identified elsewhere 
in this solicitation, has been set aside for award to one or more small 
business concerns.
    (2) Offers on the non-set-aside portion will be evaluated first and 
award will be made on that portion in accordance with the provisions of 
this solicitation.
    (3) 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).
    (4) The contractor(s) for the set-aside portion will be selected 
from among the small business concerns that submitted responsive offers 
on the non-set-aside portion. Negotiations will be conducted with the 
concern that submitted the lowest responsive offer on the non-set-aside 
portion. If the negotiations are not successful or if only part of the 
set-aside portion is awarded to that concern, negotiations will be 
conducted with the concern that submitted the second-lowest responsive 
offer on the non-set-aside portion. This process will continue until a 
contract or contracts are awarded for the entire set-aside portion.
    (c) Agreement. For the set-aside portion of the acquisition, a small 
business concern submitting an offer in its own name shall

[[Page 114]]

furnish, in performing the contract, only end items manufactured or 
produced by small business concerns in the United States or its outlying 
areas. If this procurement is processed under simplified acquisition 
procedures and the total amount of this contract does not exceed 
$25,000, a small business concern may furnish the product of any 
domestic firm. This paragraph does not apply to construction or service 
contracts.

                             (End of clause)

    Alternate I (OCT 1995). When the acquisition is for a product in a 
class for which the Small Business Administration has determined that 
there are no small business manufacturers or processors in the Federal 
market in accordance with 19.502-2(c), delete paragraph (c).

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 25069, June 12, 1989; 
55 FR 52798, Dec. 21, 1990; 60 FR 48265, Sept. 18, 1995; 61 FR 39209, 
July 26, 1996; 68 FR 28085, May 22, 2003]



Sec.  52.219-8  Utilization of small business concerns.

    As prescribed in 19.708(a), insert the following clause:

            Utilization of Small Business Concerns (OCT 2000)

    (a) It is the policy of the United States that small business 
concerns, veteran-owned small business concerns, service-disabled 
veteran-owned small business concerns, HUBZone small business concerns, 
small disadvantaged business concerns, and women-owned small business 
concerns shall have the maximum practicable opportunity to participate 
in performing contracts let by any Federal agency, including contracts 
and subcontracts for subsystems, assemblies, components, and related 
services for major systems. It is further the policy of the United 
States that its prime contractors establish procedures to ensure the 
timely payment of amounts due pursuant to the terms of their 
subcontracts with small business concerns, veteran-owned small business 
concerns, service-disabled veteran-owned small business concerns, 
HUBZone small business concerns, small disadvantaged business concerns, 
and women-owned small business concerns.
    (b) The Contractor hereby agrees to carry out this policy in the 
awarding of subcontracts to the fullest extent consistent with efficient 
contract performance. The Contractor further agrees to cooperate in any 
studies or surveys as may be conducted by the United States Small 
Business Administration or the awarding agency of the United States as 
may be necessary to determine the extent of the Contractor's compliance 
with this clause.
    (c) Definitions. As used in this contract--
    HUBZone small business concern means a small business concern that 
appears on the List of Qualified HUBZone Small Business Concerns 
maintained by the Small Business Administration.
    Service-disabled veteran-owned small business concern--
    (1) Means a small business concern--
    (i) Not less than 51 percent of which is owned by one or more 
service-disabled veterans or, in the case of any publicly owned 
business, not less than 51 percent of the stock of which is owned by one 
or more service-disabled veterans; and
    (ii) The management and daily business operations of which are 
controlled by one or more service-disabled veterans or, in the case of a 
veteran with permanent and severe disability, the spouse or permanent 
caregiver of such veteran.
    (2) Service-disabled veteran means a veteran, as defined in 38 
U.S.C. 101(2), with a disability that is service-connected, as defined 
in 38 U.S.C. 101(16).
    Small business concern means a small business as defined pursuant to 
Section 3 of the Small Business Act and relevant regulations promulgated 
pursuant thereto.
    Small disadvantaged business concern means a small business concern 
that represents, as part of its offer that--
    (1) It has received certification as a small disadvantaged business 
concern consistent with 13 CFR part 124, subpart B;
    (2) No material change in disadvantaged ownership and control has 
occurred since its certification;
    (3) Where the concern is owned by one or more individuals, the net 
worth of each individual upon whom the certification is based does not 
exceed $750,000 after taking into account the applicable exclusions set 
forth at 13 CFR 124.104(c)(2); and
    (4) It is identified, on the date of its representation, as a 
certified small disadvantaged business in the database maintained by the 
Small Business Administration (PRO-Net).
    Veteran-owned small business concern means a small business 
concern--
    (1) Not less than 51 percent of which is owned by one or more 
veterans (as defined at 38 U.S.C. 101(2)) or, in the case of any 
publicly owned business, not less than 51 percent of the stock of which 
is owned by one or more veterans; and
    (2) The management and daily business operations of which are 
controlled by one or more veterans.
    Women-owned small business concern means a small business concern--
    (1) That is at least 51 percent owned by one or more women, or, in 
the case of any publicly owned business, at least 51 percent of

[[Page 115]]

the stock of which is owned by one or more women; and
    (2) Whose management and daily business operations are controlled by 
one or more women.
    (d) Contractors acting in good faith may rely on written 
representations by their subcontractors regarding their status as a 
small business concern, a veteran-owned small business concern, a 
service-disabled veteran-owned small business concern, a HUBZone small 
business concern, a small disadvantaged business concern, or a women-
owned small business concern.

                             (End of clause)

[63 FR 70275, Dec. 18, 1998, as amended at 64 FR 3196, Jan. 20, 1999; 64 
FR 10549, Mar. 4, 1999; 64 FR 32749, June 17, 1999; 64 FR 36224, July 2, 
1999; 65 FR 60546, Oct. 11, 2000]



Sec.  52.219-9  Small business subcontracting plan.

    As prescribed in 19.708(b), insert the following clause:

              Small Business Subcontracting Plan (JAN 2002)

    (a) This clause does not apply to small business concerns.
    (b) Definitions. As used in this clause--
    Commercial item means a product or service that satisfies the 
definition of commercial item in section 2.101 of the Federal 
Acquisition Regulation.
    Commercial plan means a subcontracting plan (including goals) that 
covers the offeror's fiscal year and that applies to the entire 
production of commercial items sold by either the entire company or a 
portion thereof (e.g., division, plant, or product line).
    Individual contract plan means a subcontracting plan that covers the 
entire contract period (including option periods), applies to a specific 
contract, and has goals that are based on the offeror's planned 
subcontracting in support of the specific contract, except that indirect 
costs incurred for common or joint purposes may be allocated on a 
prorated basis to the contract.
    Master plan means a subcontracting plan that contains all the 
required elements of an individual contract plan, except goals, and may 
be incorporated into individual contract plans, provided the master plan 
has been approved.
    Subcontract 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.
    (c) The offeror, upon request by the Contracting Officer, shall 
submit and negotiate a subcontracting plan, where applicable, that 
separately addresses subcontracting with small business, veteran-owned 
small business, service-disabled veteran-owned small business, HUBZone 
small business concerns, small disadvantaged business, and women-owned 
small business concerns. If the offeror is submitting an individual 
contract plan, the plan must separately address subcontracting with 
small business, veteran-owned small business, service-disabled veteran-
owned small business, HUBZone small business, small disadvantaged 
business, and women-owned small business concerns, with a separate part 
for the basic contract and separate parts for each option (if any). The 
plan shall be included in and made a part of the resultant contract. The 
subcontracting plan shall be negotiated within the time specified by the 
Contracting Officer. Failure to submit and negotiate the subcontracting 
plan shall make the offeror ineligible for award of a contract.
    (d) The offeror's subcontracting plan shall include the following:
    (1) Goals, expressed in terms of percentages of total planned 
subcontracting dollars, for the use of small business, veteran-owned 
small business, service-disabled veteran-owned small business, HUBZone 
small business, small disadvantaged business, and women-owned small 
business concerns as subcontractors. The offeror shall include all 
subcontracts that contribute to contract performance, and may include a 
proportionate share of products and services that are normally allocated 
as indirect costs.
    (2) A statement of--
    (i) Total dollars planned to be subcontracted for an individual 
contract plan; or the offeror's total projected sales, expressed in 
dollars, and the total value of projected subcontracts to support the 
sales for a commercial plan;
    (ii) Total dollars planned to be subcontracted to small business 
concerns;
    (iii) Total dollars planned to be subcontracted to veteran-owned 
small business concerns;
    (iv) Total dollars planned to be subcontracted to service-disabled 
veteran-owned small business;
    (v) Total dollars planned to be subcontracted to HUBZone small 
business concerns;
    (vi) Total dollars planned to be subcontracted to small 
disadvantaged business concerns; and
    (vii) Total dollars planned to be subcontracted to women-owned small 
business concerns.
    (3) A description of the principal types of supplies and services to 
be subcontracted, and an identification of the types planned for 
subcontracting to--
    (i) Small business concerns;
    (ii) Veteran-owned small business concerns;

[[Page 116]]

    (iii) Service-disabled veteran-owned small business concerns;
    (iv) HUBZone small business concerns;
    (v) Small disadvantaged business concerns; and
    (vi) Women-owned small business concerns.
    (4) A description of the method used to develop the subcontracting 
goals in paragraph (d)(1) of this clause.
    (5) A description of the method used to identify potential sources 
for solicitation purposes (e.g., existing company source lists, the 
Procurement Marketing and Access Network (PRO-Net) of the Small Business 
Administration (SBA), veterans service organizations, the National 
Minority Purchasing Council Vendor Information Service, the Research and 
Information Division of the Minority Business Development Agency in the 
Department of Commerce, or small, HUBZone, small disadvantaged, and 
women-owned small business trade associations). A firm may rely on the 
information contained in PRO-Net as an accurate representation of a 
concern's size and ownership characteristics for the purposes of 
maintaining a small, veteran-owned small, service-disabled veteran-owned 
small, HUBZone small, small disadvantaged, and women-owned small 
business source list. Use of PRO-Net as its source list does not relieve 
a firm of its responsibilities (e.g., outreach, assistance, counseling, 
or publicizing subcontracting opportunities) in this clause.
    (6) A statement as to whether or not the offeror in included 
indirect costs in establishing subcontracting goals, and a description 
of the method used to determine the proportionate share of indirect 
costs to be incurred with--
    (i) Small business concerns;
    (ii) Veteran-owned small business concerns;
    (iii) Service-disabled veteran-owned small business concerns;
    (iv) HUBZone small business concerns;
    (v) Small disadvantaged business concerns; and
    (vi) Women-owned small business concerns.
    (7) The name of the individual employed by the offeror who will 
administer the offeror's subcontracting program, and a description of 
the duties of the individual.
    (8) A description of the efforts the offeror will make to assure 
that small business, veteran-owned small business, service-disabled 
veteran-owned small business, HUBZone small business, small 
disadvantaged business, and women-owned small business concerns have an 
equitable opportunity to compete for subcontracts.
    (9) Assurances that the offeror will include the clause of this 
contract entitled ``Utilization of Small Business Concerns'' in all 
subcontracts that offer further subcontracting opportunities, and that 
the offeror will require all subcontractors (except small business 
concerns) that receive subcontracts in excess of $500,000 ($1,000,000 
for construction of any public facility) to adopt a subcontracting plan 
that complies with the requirements of this clause.
    (10) Assurances that the offeror will--
    (i) Cooperate in any studies or surveys as may be required;
    (ii) Submit periodic reports so that the Government can determine 
the extent of compliance by the offeror with the subcontracting plan;
    (iii) Submit Standard Form (SF) 294, Subcontracting Report for 
Individual Contracts, and/or SF 295, Summary Subcontract Report, in 
accordance with paragraph (j) of this clause. The reports shall provide 
information on subcontract awards to small business concerns, veteran-
owned small business concerns, service-disabled veteran-owned small 
business concerns, HUBZone small business concerns, small disadvantaged 
business concerns, women-owned small business concerns, and Historically 
Black Colleges and Universities and Minority Institutions. Reporting 
shall be in accordance with the instructions on the forms or as provided 
in agency regulations.
    (iv) Ensure that its subcontractors agree to submit SF 294 and SF 
295.
    (11) A description of the types of records that will be maintained 
concerning procedures that have been adopted to comply with the 
requirements and goals in the plan, including establishing source lists; 
and a description of the offeror's efforts to locate small business, 
veteran-owned small business, service-disabled veteran-owned small 
business, HUBZone small business, small disadvantaged business, and 
women-owned small business concerns and award subcontracts to them. The 
records shall include at least the following (on a plant-wide or 
company-wide basis, unless otherwise indicated):
    (i) Source lists (e.g., PRO-Net), guides, and other data that 
identify small business, veteran-owned small business, service-disabled 
veteran-owned small business, HUBZone small business, small 
disadvantaged business, and women-owned small business concerns.
    (ii) Organizations contacted in an attempt to locate sources that 
are small business, veteran-owned small business, service-disabled 
veteran-owned small business, HUBZone small business, small 
disadvantaged business, or women-owned small business concerns.
    (iii) Records on each subcontract solicitation resulting in an award 
of more than $100,000, indicating--
    (A) Whether small business concerns were solicited and, if not, why 
not;
    (B) Whether veteran-owned small business concerns were solicited 
and, if not, why not;

[[Page 117]]

    (C) Whether service-disabled veteran-owned small business concerns 
were solicited and, if not, why not;
    (D) Whether HUBZone small business concerns were solicited and, if 
not, why not;
    (E) Whether small disadvantaged business concerns were solicited 
and, if not, why not;
    (F) Whether women-owned small business concerns were solicited and, 
if not, why not; and
    (G) If applicable, the reason award was not made to a small business 
concern.
    (iv) Records of any outreach efforts to contact--
    (A) Trade associations;
    (B) Business development organizations;
    (C) Conferences and trade fairs to locate small, HUBZone small, 
small disadvantaged, and women-owned small business sources; and
    (D) Veterans service organizations.
    (v) Records of internal guidance and encouragement provided to 
buyers through--
    (A) Workshops, seminars, training, etc.; and
    (B) Monitoring performance to evaluate compliance with the program's 
requirements.
    (vi) On a contract-by-contract basis, records to support award data 
submitted by the offeror to the Government, including the name, address, 
and business size of each subcontractor. Contractors having commercial 
plans need not comply with this requirement.
    (e) In order to effectively implement this plan to the extent 
consistent with efficient contract performance, the Contractor shall 
perform the following functions:
    (1) Assist small business, veteran-owned small business, service-
disabled veteran-owned small business, HUBZone small business, small 
disadvantaged business, and women-owned small business concerns by 
arranging solicitations, time for the preparation of bids, quantities, 
specifications, and delivery schedules so as to facilitate the 
participation by such concerns. Where the Contractor's lists of 
potential small business, veteran-owned small business, service-disabled 
veteran-owned small business, HUBZone small business, small 
disadvantaged business, and women-owned small business subcontractors 
are excessively long, reasonable effort shall be made to give all such 
small business concerns an opportunity to compete over a period of time.
    (2) Provide adequate and timely consideration of the potentialities 
of small business, veteran-owned small business, service-disabled 
veteran-owned small business, HUBZone small business, small 
disadvantaged business, and women-owned small business concerns in all 
``make-or-buy'' decisions.
    (3) Counsel and discuss subcontracting opportunities with 
representatives of small business, veteran-owned small business, 
service-disabled veteran-owned small business, HUBZone small business, 
small disadvantaged business, and women-owned small business firms.
    (4) Provide notice to subcontractors concerning penalties and 
remedies for misrepresentations of business status as small, veteran-
owned small business, HUBZone small, small disadvantaged, or women-owned 
small business for the purpose of obtaining a subcontract that is to be 
included as part or all of a goal contained in the Contractor's 
subcontracting plan.
    (f) A master plan on a plant or division-wide basis that contains 
all the elements required by paragraph (d) of this clause, except goals, 
may be incorporated by reference as a part of the subcontracting plan 
required of the offeror by this clause; provided--
    (1) The master plan has been approved,
    (2) The offeror ensures that the master plan is updated as necessary 
and provides copies of the approved master plan, including evidence of 
its approval, to the Contracting Officer, and
    (3) Goals and any deviations from the master plan deemed necessary 
by the Contracting Officer to satisfy the requirements of this contract 
are set forth in the individual subcontracting plan.
    (g) A commercial plan is the preferred type of subcontracting plan 
for contractors furnishing commercial items. The commercial plan shall 
relate to the offeror's planned subcontracting generally, for both 
commercial and Government business, rather than solely to the Government 
contract. Commercial plans are also preferred for subcontractors that 
provide commercial items under a prime contract, whether or not the 
prime contractor is supplying a commercial item.
    (h) Prior compliance of the offeror with other such subcontracting 
plans under previous contracts will be considered by the Contracting 
Officer in determining the responsibility of the offeror for award of 
the contract.
    (i) The failure of the Contractor or subcontractor to comply in good 
faith with (1) the clause of this contract entitled ``Utilization Of 
Small Business Concerns,'' or (2) an approved plan required by this 
clause, shall be a material breach of the contract.
    (j) The Contractor shall submit the following reports:
    (1) Standard Form 294, Subcontracting Report for Individual 
Contracts. This report shall be submitted to the Contracting Officer 
semiannually and at contract completion. The report covers subcontract 
award data related to this contract. This report is not required for 
commercial plans.
    (2) Standard Form 295, Summary Subcontract Report. This report 
encompasses all of the contracts with the awarding agency. It must be 
submitted semi-annually for contracts

[[Page 118]]

with the Department of Defense and annually for contracts with civilian 
agencies. If the reporting activity is covered by a commercial plan, the 
reporting activity must report annually all subcontract awards under 
that plan. All reports submitted at the close of each fiscal year (both 
individual and commercial plans) shall include a breakout, in the 
Contractor's format, of subcontract awards, in whole dollars, to small 
disadvantaged business concerns by North American Industry 
Classification System (NAICS) Industry Subsector. For a commercial plan, 
the Contractor may obtain from each of its subcontractors a predominant 
NAICS Industry Subsector and report all awards to that subcontractor 
under its predominant NAICS Industry Subsector.

                             (End of clause)

    Alternate I (Oct 2001). When contracting by sealed bidding rather 
than by negotiation, substitute the following paragraph (c) for 
paragraph (c) of the basic clause:

    (c) The apparent low bidder, upon request by the Contracting 
Officer, shall submit a subcontracting plan, where applicable, that 
separately addresses subcontracting with small business, veteran-owned 
small business, service-disabled veteran-owned small business, HUBZone 
small business, small disadvantaged business, and women-owned small 
business concerns. If the bidder is submitting an individual contract 
plan, the plan must separately address subcontracting with small 
business, veteran-owned small business, service-disabled veteran-owned 
small business, HUBZone small business, small disadvantaged business, 
and women-owned small business concerns, with a separate part for the 
basic contract and separate parts for each option (if any). The plan 
shall be included in and made a part of the resultant contract. The 
subcontracting plan shall be submitted within the time specified by the 
Contracting Officer. Failure to submit the subcontracting plan shall 
make the bidder ineligible for the award of a contract.

    Alternate II (Oct 2001). As prescribed in 19.708(b)(1), substitute 
the following paragraph (c) for paragraph (c) of the basic clause:

    (c) Proposals submitted in response to this solicitation shall 
include a subcontracting plan that separately addresses subcontracting 
with small business, veteran-owned small business, service-disabled 
veteran-owned small business, HUBZone small business, small 
disadvantaged business, and women-owned small business concerns. If the 
offeror is submitting an individual contract plan, the plan must 
separately address subcontracting with small business, veteran-owned 
small business, service-disabled veteran-owned small business, HUBZone 
small business, small disadvantaged business, and women-owned small 
business concerns, with a separate part for the basic contract and 
separate parts for each option (if any). The plan shall be included in 
and made a part of the resultant contract. The subcontracting plan shall 
be negotiated within the time specified by the Contracting Officer. 
Failure to submit and negotiate a subcontracting plan shall make the 
offeror ineligible for award of a contract.

[48 FR 42478, Sept. 19, 1983, as amended at 52 FR 19805, May 27, 1987; 
54 FR 29283, July 11, 1989; 54 FR 49296, Nov. 30, 1989; 55 FR 3888, Feb. 
5, 1990; 55 FR 52798, Dec. 21, 1990; 60 FR 48265, Sept. 18, 1995; 61 FR 
2639, Jan. 26, 1996; 61 FR 31643, June 20, 1996; 63 FR 34067, June 22, 
1998; 63 FR 36124, July 1, 1998; 63 FR 70276, 70293, Dec. 18, 1998; 64 
FR 36224, July 2, 1999; 65 FR 46058, July 26, 2000; 65 FR 60547, Oct. 
11, 2000; 66 FR 53493, Oct. 22, 2001; 67 FR 1858, Jan. 14, 2002]



Sec.  52.219-10  Incentive Subcontracting Program.

    As prescribed in 19.708(c)(1), insert the following clause:

               Incentive Subcontracting Program (OCT 2001)

    (a) Of the total dollars it plans to spend under subcontracts, the 
Contractor has committed itself in its subcontracting plan to try to 
award certain percentages to small business, veteran-owned small 
business, service-disabled veteran-owned small business, HUBZone small 
business, small disadvantaged business, and women-owned small business 
concerns, respectively.
    (b) If the Contractor exceeds its subcontracting goals for small 
business, veteran-owned small business, service-disabled veteran-owned 
small business, HUBZone small business, and women-owned small business 
concerns in performing this contract, it will receive -- [Contracting 
Officer to insert the appropriate number between 0 and 10] percent of 
the dollars in excess of each goal in the plan, unless the Contracting 
Officer determines that the excess was not due to the Contractor's 
efforts (e.g., a subcontractor cost overrun caused the actual 
subcontract amount to exceed that estimated in the subcontracting plan, 
or the award of subcontracts that had been planned but had not been 
disclosed in the subcontracting plan during contract negotiations). 
Determinations under this paragraph are unilateral decisions made solely 
at the discretion of the Government.
    (c) If this is a cost-plus-fixed-fee contract, the sum of the fixed 
fee and the incentive fee earned under this contract may not exceed

[[Page 119]]

the limitations in 15.404-4 of the Federal Acquisition Regulation.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 48266, 48267, Sept. 
18, 1995; 62 FR 51271, Sept. 30, 1997; 63 FR 36125, July 1, 1998; 63 FR 
70277, Dec. 18, 1998; 64 FR 72449, Dec. 27, 1999; 65 FR 60548, Oct. 11, 
2000; 66 FR 53493, Oct. 22, 2001]



Sec.  52.219-11  Special 8(a) Contract Conditions.

    As prescribed in 19.811-3(a), insert the following clause:

               Special 8(a) Contract Conditions (FEB 1990)

    The Small Business Administration (SBA) agrees to the following:
    (a) To furnish the supplies or services set forth in this contract 
according to the specifications and the terms and conditions hereof by 
subcontracting with an eligible concern pursuant to the provisions of 
section 8(a) of the Small Business Act, as amended (15 U.S.C. 637(a)).
    (b) That in the event SBA does not award a subcontract for all or a 
part of the work hereunder, this contract may be terminated either in 
whole or in part without cost to either party.
    (c) Except for novation agreements and advance payments, delegates 
to the ---- [insert name of contracting agency] the responsibility for 
administering the subcontract to be awarded hereunder with complete 
authority to take any action on behalf of the Government under the terms 
and conditions of the subcontract; provided, however, that the ---- 
[insert name of contracting agency] shall give advance notice to the SBA 
before it issues a final notice terminating the right of a subcontractor 
to proceed with further performance, either in whole or in part, under 
the subcontract for default or for the convenience of the Government.
    (d) That payments to be made under any subcontract awarded under 
this contract will be made directly to the subcontractor by the ---- 
[insert name of contracting agency].
    (e) That the subcontractor awarded a subcontract hereunder shall 
have the right of appeal from decisions of the Contracting Officer 
cognizable under the Disputes clause of said subcontract.
    (f) To notify the [insert name of contracting agency] Contracting 
Officer immediately upon notification by the subcontractor that the 
owner or owners upon whom 8(a) eligibility was based plan to relinquish 
ownership or control of the concern.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 46009, Oct. 31, 1989; 
55 FR 3888, Feb. 5, 1990; 61 FR 67422, Dec. 20, 1996]



Sec.  52.219-12  Special 8(a) Subcontract Conditions.

    As prescribed in 19.811-3(b), insert the following clause:

             Special 8(a) Subcontract Conditions (FEB 1990)

    (a) The Small Business Administration (SBA) has entered into 
Contract No. ---- [insert number of contract] with the ---- [insert name 
of contracting agency] to furnish the supplies or services as described 
therein. A copy of the contract is attached hereto and made a part 
hereof.
    (b) The ---- [insert name of subcontractor], hereafter referred to 
as the subcontractor, agrees and acknowledges as follows:
    (1) That it will, for and on behalf of the SBA, fulfill and perform 
all of the requirements of Contract No. ---- [insert number of contract] 
for the consideration stated therein and that it has read and is 
familiar with each and every part of the contract.
    (2) That the SBA has delegated responsibility, except for novation 
agreements and advance payments, for the administration of this 
subcontract to the ---- [insert name of contracting agency] with 
complete authority to take any action on behalf of the Government under 
the terms and conditions of this contract.
    (3) That it will not subcontract the performance of any of the 
requirements of this subcontract to any lower tier subcontractor without 
the prior written approval of the SBA and the designated Contracting 
Officer of the ---- [insert name of contracting agency].
    (4) That is will notify the [insert name of contracting agency] 
Contracting Officer in writing immediately upon entering an agreement 
(either oral or written) to transfer all or part of its stock or other 
ownership interest to any other party.
    (c) Payments, including any progress payments under this 
subcontract, will be made directly to the subcontractor by the ---- 
[insert name of contracting agency].

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 34757, Aug. 21, 1989; 
54 FR 46009, Oct. 31, 1989; 55 FR 3889, Feb. 5, 1990; 55 FR 38518, Sept. 
18, 1990; 61 FR 67422, Dec. 20, 1996]

[[Page 120]]



Sec.  52.219-13  [Reserved]



Sec.  52.219-14  Limitations on Subcontracting.

    As prescribed in 19.508(e) or 19.811-3(e), insert the following 
clause:

                Limitations on Subcontracting (DEC 1996)

    (a) This clause does not apply to the unrestricted portion of a 
partial set-aside.
    (b) By submission of an offer and execution of a contract, the 
Offeror/Contractor agrees that in performance of the contract in the 
case of a contract for--
    (1) Services (except construction). At least 50 percent of the cost 
of contract performance incurred for personnel shall be expended for 
employees of the concern.
    (2) Supplies (other than procurement from a nonmanufacturer of such 
supplies). The concern shall perform work for at least 50 percent of the 
cost of manufacturing the supplies, not including the cost of materials.
    (3) General construction. The concern will perform at least 15 
percent of the cost of the contract, not including the cost of 
materials, with its own employees.
    (4) Construction by special trade contractors. The concern will 
perform at least 25 percent of the cost of the contract, not including 
the cost of materials, with its own employees.

                             (End of clause)

[52 FR 38190, Oct. 14, 1988, as amended at 55 FR 52798, Dec. 21, 1990; 
61 FR 67411, Dec. 20, 1996; 64 FR 32749, June 17, 1999]



Sec.  52.219-15  [Reserved]



Sec.  52.219-16  Liquidated Damages--Subcontracting Plan.

    As prescribed in 19.708(b)(2), insert the following clause:

           Liquidated Damages--Subcontracting Plan (JAN 1999)

    (a) Failure to make a good faith effort to comply with the 
subcontracting plan, as used in this clause, means a willful or 
intentional failure to perform in accordance with the requirements of 
the subcontracting plan approved under the clause in this contract 
entitled ``Small Business Subcontracting Plan,'' or willful or 
intentional action to frustrate the plan.
    (b) Performance shall be measured by applying the percentage goals 
to the total actual subcontracting dollars or, if a commercial plan is 
involved, to the pro rata share of actual subcontracting dollars 
attributable to Government contracts covered by the commercial plan. If, 
at contract completion or, in the case of a commercial plan, at the 
close of the fiscal year for which the plan is applicable, the 
Contractor has failed to meet its subcontracting goals and the 
Contracting Officer decides in accordance with paragraph (c) of this 
clause that the Contractor failed to make a good faith effort to comply 
with its subcontracting plan, established in accordance with the clause 
in this contract entitled ``Small Business Subcontracting Plan,'' the 
Contractor shall pay the Government liquidated damages in an amount 
stated. The amount of probable damages attributable to the Contractor's 
failure to comply shall be an amount equal to the actual dollar amount 
by which the Contractor failed to achieve each subcontract goal.
    (c) Before the Contracting Officer makes a final decision that the 
Contractor has failed to make such good faith effort, the Contracting 
Officer shall give the Contractor written notice specifying the failure 
and permitting the Contractor to demonstrate what good faith efforts 
have been made and to discuss the matter. Failure to respond to the 
notice may be taken as an admission that no valid explanation exists. 
If, after consideration of all the pertinent data, the Contracting 
Officer finds that the Contractor failed to make a good faith effort to 
comply with the subcontracting plan, the Contracting Officer shall issue 
a final decision to that effect and require that the Contractor pay the 
Government liquidated damages as provided in paragraph (b) of this 
clause.
    (d) With respect to commercial plans, the Contracting Officer who 
approved the plan will perform the functions of the Contracting Officer 
under this clause on behalf of all agencies with contracts covered by 
the commercial plan.
    (e) The Contractor shall have the right of appeal, under the clause 
in this contract entitled Disputes, from any final decision of the 
Contracting Officer.
    (f) Liquidated damages shall be in addition to any other remedies 
that the Government may have.

                             (End of clause)

[54 FR 30710, July 21, 1989, as amended at 60 FR 48267, Sept. 18, 1995; 
63 FR 34068, June 22, 1998; 63 FR 70277, Dec. 18, 1998]



Sec.  52.219-17  Section 8(a) Award.

    As prescribed in 19.811-3(c), insert the following clause:

                      Section 8(a) Award (DEC 1996)

    (a) By execution of a contract, the Small Business Administration 
(SBA) agrees to the following:
    (1) To furnish the supplies or services set forth in the contract 
according to the specifications and the terms and conditions by 
subcontracting with the Offeror who has

[[Page 121]]

been determined an eligible concern pursuant to the provisions of 
section 8(a) of the Small Business Act, as amended (15 U.S.C. 637(a)).
    (2) Except for novation agreements and advance payments, delegates 
to the ---- (insert name of contracting activity) the responsibility for 
administering the contract with complete authority to take any action on 
behalf of the Government under the terms and conditions of the contract; 
provided, however that the contracting agency shall give advance notice 
to the SBA before it issues a final notice terminating the right of the 
subcontractor to proceed with further performance, either in whole or in 
part, under the contract.
    (3) That payments to be made under the contract will be made 
directly to the subcontractor by the contracting activity.
    (4) To notify the [insert name of contracting agency] Contracting 
Officer immediately upon notification by the subcontractor that the 
owner or owners upon whom 8(a) eligibility was based plan to relinquish 
ownership or control of the concern.
    (5) That the subcontractor awarded a subcontract hereunder shall 
have the right of appeal from decisions of the cognizant Contracting 
Officer under the ``Disputes'' clause of the subcontract.
    (b) The offeror/subcontractor agrees and acknowledges that it will, 
for and on behalf of the SBA, fulfill and perform all of the 
requirements of the contract.
    (c) The offeror/subcontractor agrees that it will not subcontract 
the performance of any of the requirements of this subcontract to any 
lower tier subcontractor without the prior written approval of the SBA 
and the cognizant Contracting Officer of the ------ [insert name of 
contracting agency].

                             (End of clause)

[54 FR 46009, Oct. 31, 1989, as amended at 55 FR 3889, Feb. 5, 1990; 61 
FR 67422, Dec. 20, 1996]



Sec.  52.219-18  Notification of Competition Limited to Eligible 8(a) Concerns.

    As prescribed in 19.811-3(d), insert the following clause:

  Notification of Competition Limited to Eligible 8(a) Concerns (June 
                                  2003)

    (a) Offers are solicited only from small business concerns expressly 
certified by the Small Business Administration (SBA) for participation 
in the SBA's 8(a) Program and which meet the following criteria at the 
time of submission of offer--
    (1) The Offeror is in conformance with the 8(a) support limitation 
set forth in its approved business plan; and
    (2) The Offeror is in conformance with the Business Activity Targets 
set forth in its approved business plan or any remedial action directed 
by the SBA.
    (b) By submission of its offer, the Offeror represents that it meets 
all of the criteria set forth in paragraph (a) of this clause.
    (c) Any award resulting from this solicitation will be made to the 
Small Business Administration, which will subcontract performance to the 
successful 8(a) offeror selected through the evaluation criteria set 
forth in this solicitation.
    (d)(1) Agreement. A small business concern submitting an offer in 
its own name shall furnish, in performing the contract, only end items 
manufactured or produced by small business concerns in the United States 
or its outlying areas. If this procurement is processed under simplified 
acquisition procedures and the total amount of this contract does not 
exceed $25,000, a small business concern may furnish the product of any 
domestic firm. This paragraph does not apply to construction or service 
contracts.
    (2) The [insert name of SBA's contractor] will notify the [insert 
name of contracting agency] Contracting Officer in writing immediately 
upon entering an agreement (either oral or written) to transfer all or 
part of its stock or other ownership interest to any other party.

                             (End of clause)

    Alternate I (NOV 1989). If the competition is to be limited to 8(a) 
concerns within one or more specific SBA regions or districts, add the 
following subparagraph (a)(4) to paragraph (a) of the clause:

    (4) The offeror's approved business plan is on the file and serviced 
by ----------* ---------- (*Contracting Officer completes by inserting 
the appropriate SBA District and/or Regional Office(s) as identified by 
the SBA).

    Alternate II (DEC 1996). When the acquisition is for a product in a 
class for which the Small Business Administration has determined that 
there are no small business manufacturers or processors in the Federal 
market in accordance with 19.502-2(c), delete subparagraph (d)(1).

[54 FR 46009, Oct. 31, 1989; 54 FR 48105, Nov. 21, 1989, as amended at 
55 FR 3889, Feb. 5, 1990; 55 FR 25532, June 21, 1990; 55 FR 38518, Sept. 
18, 1990; 60 FR 48267, Sept. 18, 1995; 61 FR 39209, July 26, 1996; 61 FR 
67422, Dec. 20, 1996; 62 FR 238, Jan. 2, 1997; 62 FR 12720, Mar. 17, 
1997; 64 FR 32745, June 17, 1999; 64 FR 51850, Sept. 24, 1999; 68 FR 
28085, May 22, 2003]

[[Page 122]]



Sec.  52.219-19  Small Business Concern Representation for the Small 
Business Competitiveness Demonstration Program.

    As prescribed in 19.1008(a), insert the following provision:

      Small Business Concern Representation for the Small Business 
            Competitiveness Demonstration Program (OCT 2000)

    (a) Definition.
    Emerging small business as used in this solicitation, means a small 
business concern whose size is no greater than 50 percent of the 
numerical size standard applicable to the North American Industry 
Classification System (NAICS) code assigned to a contracting 
opportunity.
    (b) [Complete only if the Offeror has represented itself under the 
provision at 52.219-1 as a small business concern under the size 
standards of this solicitation.]
    The Offeror [squ] is, [squ] is not an emerging small business.
    (c) (Complete only if the Offeror is a small business or an emerging 
small business, indicating its size range.)
    Offeror's number of employees for the past 12 months (check this 
column if size standard stated in solicitation is expressed in terms of 
number of employees) or Offeror's average annual gross revenue for the 
last 3 fiscal years (check this column if size standard stated in 
solicitation is expressed in terms of annual receipts). (Check one of 
the following.)

 
           No. of employees                Avg. annual gross revenues
 
--50 or fewer                           --$1 million or less
--51-100                                --$1,000,001-$2 million
--101-250                               --$2,000,001-$3.5 million
--251-500                               --$3,500,001-$5 million
--501-750                               --$5,000,001-$10 million
--751-1,000                             --$10,000,001-$17 million
-- Over 1,000                           -- Over $17 million
 

                           (End of provision)

[55 FR 52798, Dec. 21, 1990, as amended at 56 FR 29138, June 25, 1991; 
62 FR 238, Jan. 2, 1997; 65 FR 46058, July 26, 2000; 67 FR 13068, Mar. 
20, 2002]



Sec.  52.219-20  Notice of Emerging Small Business Set-Aside.

    As prescribed in 19.1008(b), insert the following provision:

         Notice of Emerging Small Business Set-Aside (JAN 1991)

    Offers or quotations under this acquisition are solicited from 
emerging small business concerns only. Offers that are not from an 
emerging small business shall not be considered and shall be rejected.

                           (End of provision)

[55 FR 52799, Dec. 21, 1990, as amended at 67 FR 13068, Mar. 20, 2002]



Sec.  52.219-21  Small Business Size Representation for Targeted Industry 
Categories Under the Small Business Competitiveness Demonstration Program.

    As prescribed in 19.1008(c), insert the following provision:

  Small Business Size Representation for Targeted Industry Categories 
  Under the Small Business Competitiveness Demonstration Program (MAY 
                                  1999)

    (Complete only if the Offeror has represented itself under the 
provision at 52.219-1 as a small business concern under the size 
standards of this solicitation.)
    Offeror's number of employees for the past 12 months (check this 
column if size standard stated in solicitation is expressed in terms of 
number of employees) or Offeror's average annual gross revenue for the 
last 3 fiscal years (check this column if size standard stated in 
solicitation is expressed in terms of annual receipts). (Check one of 
the following.)

 
           No. of employees                Avg. annual gross revenues
 
--50 or fewer                           --$1 million or less
--51-100                                --$1,000,001-$2 million
--101-250                               --$2,000,001-$3.5 million
--251-500                               --$3,500,001-$5 million
--501-750                               --$5,000,001-$10 million
--751-1,000                             --$10,000,001-$17 million
-- Over 1,000                           -- Over $17 million
 

                           (End of provision)

[55 FR 52799, Dec. 21, 1990, as amended at 56 FR 29138, June 25, 1991; 
62 FR 238, Jan. 2, 1997; 64 FR 10533, Mar. 4, 1999; 67 FR 6121, Feb. 8, 
2002]



Sec.  52.219-22  Small Disadvantaged Business Status.

    As prescribed in 19.307(b), insert the following provision:

             Small Disadvantaged Business Status (OCT 1999)

    (a) General. This provision is used to assess an offeror's small 
disadvantaged business status for the purpose of obtaining a benefit on 
this solicitation. Status as a small business and status as a small 
disadvantaged business for general statistical purposes is covered by 
the provision at FAR 52.219-1, Small Business Program Representation.
    (b) Representations.
    (1) General. The offeror represents, as part of its offer, that it 
is a small business under

[[Page 123]]

the size standard applicable to this acquisition; and either--
    [squ] (i) It has received certification by the Small Business 
Administration as a small disadvantaged business concern consistent with 
13 CFR 124, Subpart B; and
    (A) No material change in disadvantaged ownership and control has 
occurred since its certification;
    (B) Where the concern is owned by one or more disadvantaged 
individuals, the net worth of each individual upon whom the 
certification is based does not exceed $750,000 after taking into 
account the applicable exclusions set forth at 13 CFR 124.104(c)(2); and
    (C) It is identified, on the date of its representation, as a 
certified small disadvantaged business concern in the database 
maintained by the Small Business Administration (PRO-Net); or
    [squ] (ii) It has submitted a completed application to the Small 
Business Administration or a Private Certifier to be certified as a 
small disadvantaged business concern in accordance with 13 CFR 124, 
Subpart B, and a decision on that application is pending, and that no 
material change in disadvantaged ownership and control has occurred 
since its application was submitted.
    (2)[squ]For Joint Ventures. The offeror represents, as part of its 
offer, that it is a joint venture that complies with the requirements at 
13 CFR 124.1002(f) and that the representation in paragraph (b)(1) of 
this provision is accurate for the small disadvantaged business concern 
that is participating in the joint venture. [The offeror shall enter the 
name of the small disadvantaged business concern that is participating 
in the joint venture: ------------.]
    (c) Penalties and Remedies. Anyone who misrepresents any aspects of 
the disadvantaged status of a concern for the purposes 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 the 
authority of the Small Business Act.

                           (End of provision)

    Alternate I (OCT 1998). As prescribed in 19.307(b), add the 
following paragraph (b)(3) to the basic provision:

    (3) Address. The offeror represents that its address --is, --is not 
in a region for which a small disadvantaged business procurement 
mechanism is authorized and its address has not changed since its 
certification as a small disadvantaged business concern or submission of 
its application for certification. The list of authorized small 
disadvantaged business procurement mechanisms and regions is posted at 
http://www.arnet.gov/References/sdbadjustments.htm. The offeror shall 
use the list in effect on the date of this solicitation. ``Address,'' as 
used in this provision, means the address of the offeror as listed on 
the Small Business Administrations register of small disadvantaged 
business concerns or the address on the completed application that the 
concern has submitted to the Small Business Administration or a Private 
Certifier in accordance with 13 CFR part 124, subpart B. For joint 
ventures, ``address'' refers to the address of the small disadvantaged 
business concern that is participating in the joint venture.

[63 FR 35725, June 30, 1998, as amended at 63 FR 52427, Sept. 30, 1998; 
63 FR 70277, Dec. 18, 1998; 64 FR 32749, June 17, 1999; 64 FR 36224, 
July 2, 1999]



Sec.  52.219-23  Notice of Price Evaluation Adjustment for Small Disadvantaged 
Business Concerns.

    As prescribed in 19.1104, insert the following clause:

 Notice of Price Evaluation Adjustment for Small Disadvantaged Business 
                          Concerns (June 2003)

    (a) Definitions. As used in this clause--
    Small disadvantaged business concern means an offeror that 
represents, as part of its offer, that it is a small business under the 
size standard applicable to this acquisition; and either--
    (1) It has received certification by the Small Business 
Administration as a small disadvantaged business concern consistent with 
13 CFR 124, Subpart B; and
    (i) No material change in disadvantaged ownership and control has 
occurred since its certification;
    (ii) Where the concern is owned by one or more disadvantaged 
individuals, the net worth of each individual upon whom the 
certification is based does not exceed $750,000 after taking into 
account the applicable exclusions set forth at 13 CFR 124.104(c)(2); and
    (iii) It is identified, on the date of its representation, as a 
certified small disadvantaged business concern in the database 
maintained by the Small Business Administration (PRO-Net).
    (2) It has submitted a completed application to the Small Business 
Administration or a Private Certifier to be certified as a small 
disadvantaged business concern in accordance with 13 CFR 124, Subpart B, 
and a decision on that application is pending, and that no material 
change in disadvantaged ownership and control has occurred since its 
application was submitted. In this case, in order to receive the benefit 
of a price evaluation adjustment, an offeror must receive certification 
as a small disadvantaged business

[[Page 124]]

concern by the Small Business Administration prior to contract award; or
    (3) Is a joint venture as defined in 13 CFR 124.1002(f).
    Historically black college or university means an institution 
determined by the Secretary of Education to meet the requirements of 34 
CFR 608.2. For the Department of Defense (DoD), the National Aeronautics 
and Space Administration (NASA), and the Coast Guard, the term also 
includes any nonprofit research institution that was an integral part of 
such a college or university before November 14, 1986.
    Minority institution means an institution of higher education 
meeting the requirements of Section 1046(3) of the Higher Education Act 
of 1965 (20 U.S.C. 1067k, including a Hispanic-serving institution of 
higher education, as defined in Section 316(b)(1) of the Act (20 U.S.C. 
1101a)).
    (b) Evaluation adjustment. (1) The Contracting Officer will evaluate 
offers by adding a factor of ------ [Contracting Officer insert the 
percentage] percent to the price of all offers, except--
    (i) Offers from small disadvantaged business concerns that have not 
waived the adjustment;
    (ii) An otherwise successful offer of eligible products under the 
Trade Agreements Act when the dollar threshold for application of the 
Act is equaled or exceeded (see section 25.402 of the Federal 
Acquisition Regulation (FAR));
    (iii) An otherwise successful offer where application of the factor 
would be inconsistent with a Memorandum of Understanding or other 
international agreement with a foreign government;
    (iv) For DoD, NASA, and Coast Guard acquisitions, an otherwise 
successful offer from a historically black college or university or 
minority institution; and
    (v) For DoD acquisitions, an otherwise successful offer of 
qualifying country end products (see sections 225.000-70 and 252.225-
7001 of the Defense FAR Supplement).
    (2) The Contracting Officer will apply the factor to a line item or 
a group of line items on which award may be made. The Contracting 
Officer will apply other evaluation factors described in the 
solicitation before application of the factor. The factor may not be 
applied if using the adjustment would cause the contract award to be 
made at a price that exceeds the fair market price by more than the 
factor in paragraph (b)(1) of this clause.
    (c) Waiver of evaluation adjustment. A small disadvantaged business 
concern may elect to waive the adjustment, in which case the factor will 
be added to its offer for evaluation purposes. The agreements in 
paragraph (d) of this clause do not apply to offers that waive the 
adjustment.
    -- Offeror elects to waive the adjustment.
    (d) Agreements. (1) A small disadvantaged business concern, that did 
not waive the adjustment, 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 nonmanufacturer of 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; or
    (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 concern submitting an offer in 
its own name shall furnish in performing this contract only end items 
manufactured or produced by small disadvantaged business concerns in the 
United States or its outlying areas. This paragraph does not apply to 
construction or service contracts.

                             (End of clause)

    Alternate I (June 2003). As prescribed in 19.1104, substitute the 
following paragraph (d)(2) for paragraph (d)(2) of the basic clause:
    (2) A small disadvantaged business concern submitting an offer in 
its own name shall furnish in performing this contract only end items 
manufactured or produced by small business concerns in the United States 
or its outlying areas. This paragraph does not apply to construction or 
service contracts.

    Alternate II (Oct 1998). As prescribed in 19.1104, substitute the 
following paragraph (b)(1)(i) for paragraph (b)(1)(i) of the basic 
clause:

    (i) Offers from small disadvantaged business concerns, that have not 
waived the adjustment, whose address is in a region for which an 
evaluation adjustment is authorized;

[63 FR 35725, June 30, 1998, as amended at 63 FR 52427, Sept. 30, 1998; 
64 FR 36224, July 2, 1999; 65 FR 16286, Mar. 27, 2000; 66 FR 2135, Jan. 
10, 2001; 68 FR 28085, May 22, 2003]



Sec.  52.219-24  Small Disadvantaged Business Participation Program--Targets.

    As prescribed in 19.1204(a), insert a provision substantially the 
same as the following:

[[Page 125]]

 Small Disadvantaged Business Participation Program--Targets (OCT 2000)

    (a) This solicitation contains a source selection factor or 
subfactor related to the participation of small disadvantaged business 
(SDB) concerns in the contract. Credit under that evaluation factor or 
subfactor is not available to an SDB concern that qualifies for a price 
evaluation adjustment under the clause at FAR 52.219-23, Notice of Price 
Evaluation Adjustment for Small Disadvantaged Business Concerns, unless 
the SDB concern specifically waives the price evaluation adjustment.
    (b) In order to receive credit under the source selection factor or 
subfactor, the offeror must provide, with its offer, targets, expressed 
as dollars and percentages of total contract value, for SDB 
participation in any of the North American Industry Classification 
System (NAICS) Industry Subsectors as determined by the Department of 
Commerce. The targets may provide for participation by a prime 
contractor, joint venture partner, teaming arrangement member, or 
subcontractor; however, the targets for subcontractors must be listed 
separately.

                           (End of provision)

[63 FR 36125, July 1, 1998, as amended at 65 FR 46058, July 26, 2000]



Sec.  52.219-25  Small Disadvantaged Business Participation Program--Disadvantaged 
Status and Reporting.

    As prescribed in 19.1204(b), insert the following clause:

Small Disadvantaged Business Participation Program--Disadvantaged Status 
                        and Reporting (OCT 1999)

    (a) Disadvantaged status for joint venture partners, team members, 
and subcontractors. This clause addresses disadvantaged status for joint 
venture partners, teaming arrangement members, and subcontractors and is 
applicable if this contract contains small disadvantaged business (SDB) 
participation targets. The Contractor shall obtain representations of 
small disadvantaged status from joint venture partners, teaming 
arrangement members, and subcontractors through use of a provision 
substantially the same as paragraph (b)(1)(i) of the provision at FAR 
52.219-22, Small Disadvantaged Business Status. The Contractor shall 
confirm that a joint venture partner, team member, or subcontractor 
representing itself as a small disadvantaged business concern, is 
identified as a certified small disadvantaged business in the database 
maintained by the Small Business Administration (PRO-Net) or by 
contacting the SBA's Office of Small Disadvantaged Business 
Certification and Eligibility.
    (b) Reporting requirement. If this contract contains SDB 
participation targets, the Contractor shall report on the participation 
of SDB concerns at contract completion, or as otherwise provided in this 
contract. Reporting may be on Optional Form 312, Small Disadvantaged 
Business Participation Report, or in the Contractor's own format 
providing the same information. This report is required for each 
contract containing SDB participation targets. If this contract contains 
an individual Small, Small Disadvantaged and Women-Owned Small Business 
Subcontracting Plan, reports may be submitted with the final 
Subcontracting Report for Individual Contracts (Standard Form 294) at 
the completion of the contract.

                             (End of clause)

[63 FR 36125, July 1, 1998, as amended at 63 FR 71723, Dec. 29, 1998; 64 
FR 36225, July 2, 1999]



Sec.  52.219-26  Small Disadvantaged Business Participation Program--Incentive 
Subcontracting.

    As prescribed in 19.1204(c), insert a clause substantially the same 
as the following:

     Small Disadvantaged Business Participation Program--Incentive 
                        Subcontracting (OCT 2000)

    (a) Of the total dollars it plans to spend under subcontracts, the 
Contractor has committed itself in its offer to try to award a certain 
amount to small disadvantaged business concerns in the North American 
Industry Classification System (NAICS) Industry Subsectors as determined 
by the Department of Commerce.
    (b) If the Contractor exceeds its total monetary target for 
subcontracting to small disadvantaged business concerns in the 
authorized NAICS Industry Subsectors, it will receive -- [Contracting 
Officer to insert the appropriate number between 0 and 10] percent of 
the dollars in excess of the monetary target, unless the Contracting 
Officer determines that the excess was not due to the Contractor's 
efforts (e.g., a subcontractor cost overrun caused the actual 
subcontract amount to exceed that estimated in the offer, or the excess 
was caused by the award of subcontracts that had been planned but had 
not been disclosed in the offer during contract negotiations). 
Determinations under this paragraph are unilateral decisions made solely 
at the discretion of the Government.
    (c) If this is a cost-plus-fixed-fee contract, the sum of the fixed 
fee and the incentive fee earned under this contract may not exceed

[[Page 126]]

the limitations in subsection 15.404-4 of the Federal Acquisition 
Regulation.

                             (End of clause)

[63 FR 36125, July 1, 1998, as amended at 64 FR 72449, Dec. 27, 1999; 65 
FR 46058, July 26, 2000]



Sec.  52.221  [Reserved]



Sec.  52.222-1  Notice to the Government of Labor Disputes.

    As prescribed in 22.103-5(a), insert the following clause:

          Notice to the Government of Labor Disputes (FEB 1997)

    If the Contractor has knowledge that any actual or potential labor 
dispute is delaying or threatens to delay the timely performance of this 
contract, the Contractor shall immediately give notice, including all 
relevant information, to the Contracting Officer.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 67426, Dec. 20, 1996]



Sec.  52.222-2  Payment for Overtime Premiums.

    As prescribed in 22.103-5(b), insert the following clause:

                Payment for Overtime Premiums (JUL 1990)

    (a) The use of overtime is authorized under this contract if the 
overtime premium cost does not exceed *---- or the overtime premium is 
paid for work--
---------------------------------------------------------------------------

    *Insert either ``zero'' or the dollar amount agreed to during 
negotiations.
---------------------------------------------------------------------------

    (1) Necessary to cope with emergencies such as those resulting from 
accidents, natural disasters, breakdowns of production equipment, or 
occasional production bottlenecks of a sporadic nature;
    (2) By indirect-labor employees such as those performing duties in 
connection with administration, protection, transportation, maintenance, 
standby plant protection, operation of utilities, or accounting;
    (3) To perform tests, industrial processes, laboratory procedures, 
loading or unloading of transportation conveyances, and operations in 
flight or afloat that are continuous in nature and cannot reasonably be 
interrupted or completed otherwise; or
    (4) That will result in lower overall costs to the Government.
    (b) Any request for estimated overtime premiums that exceeds the 
amount specified above shall include all estimated overtime for contract 
completion and shall--
    (1) Identify the work unit; e.g., department or section in which the 
requested overtime will be used, together with present workload, 
staffing, and other data of the affected unit sufficient to permit the 
Contracting Officer to evaluate the necessity for the overtime;
    (2) Demonstrate the effect that denial of the request will have on 
the contract delivery or performance schedule;
    (3) Identify the extent to which approval of overtime would affect 
the performance or payments in connection with other Government 
contracts, together with identification of each affected contract; and
    (4) Provide reasons why the required work cannot be performed by 
using multishift operations or by employing additional personnel.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 25532, June 21, 1990; 
55 FR 38518, Sept. 18, 1990]



Sec.  52.222-3  Convict Labor.

    As prescribed in 22.202, insert the following clause:

                        Convict Labor (June 2003)

    (a) Except as provided in paragraph (b) of this clause, the 
Contractor shall not employ in the performance of this contract any 
person undergoing a sentence of imprisonment imposed by any court of a 
State, the District of Columbia, Puerto Rico, the Northern Mariana 
Islands, American Samoa, Guam, or the U.S. Virgin Islands.
    (b) The Contractor is not prohibited from employing persons--
    (1) On parole or probation to work at paid employment during the 
term of their sentence;
    (2) Who have been pardoned or who have served their terms; or
    (3) Confined for violation of the laws of any of the States, the 
District of Columbia, Puerto Rico, the Northern Mariana Islands, 
American Samoa, Guam, or the U.S. Virgin Islands who are authorized to 
work at paid employment in the community under the laws of such 
jurisdiction, if--
    (i) The worker is paid or is in an approved work training program on 
a voluntary basis;
    (ii) Representatives of local union central bodies or similar labor 
union organizations have been consulted;
    (iii) Such paid employment will not result in the displacement of 
employed workers, or be applied in skills, crafts, or trades in which 
there is a surplus of available gainful labor in the locality, or impair 
existing contracts for services;

[[Page 127]]

    (iv) The rates of pay and other conditions of employment will not be 
less than those paid or provided for work of a similar nature in the 
locality in which the work is being performed; and
    (v) The Attorney General of the United States has certified that the 
work-release laws or regulations of the jurisdiction involved are in 
conformity with the requirements of Executive Order 11755, as amended by 
Executive Orders 12608 and 12943.

                             (End of clause)

[68 FR 28085, May 22, 2003]



Sec.  52.222-4  Contract Work Hours and Safety Standards Act--Overtime Compensation.

    As prescribed in 22.305, insert the following clause:

  Contract Work Hours and Safety Standards Act-- Overtime Compensation 
                               (SEP 2000)

    (a) Overtime requirements. No Contractor or subcontractor employing 
laborers or mechanics (see Federal Acquisition Regulation 22.300) shall 
require or permit them to work over 40 hours in any workweek unless they 
are paid at least 1 and 1/2 times the basic rate of pay for each hour 
worked over 40 hours.
    (b) Violation; liability for unpaid wages; liquidated damages. The 
responsible Contractor and subcontractor are liable for unpaid wages if 
they violate the terms in paragraph (a) of this clause. In addition, the 
Contractor and subcontractor are liable for liquidated damages payable 
to the Government. The Contracting Officer will assess liquidated 
damages at the rate of $10 per affected employee for each calendar day 
on which the employer required or permitted the employee to work in 
excess of the standard workweek of 40 hours without paying overtime 
wages required by the Contract Work Hours and Safety Standards Act.
    (c) Withholding for unpaid wages and liquidated damages. The 
Contracting Officer will withhold from payments due under the contract 
sufficient funds required to satisfy any Contractor or subcontractor 
liabilities for unpaid wages and liquidated damages. If amounts withheld 
under the contract are insufficient to satisfy Contractor or 
subcontractor liabilities, the Contracting Officer will withhold 
payments from other Federal or Federally assisted contracts held by the 
same Contractor that are subject to the Contract Work Hours and Safety 
Standards Act.
    (d) Payrolls and basic records. (1) The Contractor and its 
subcontractors shall maintain payrolls and basic payroll records for all 
laborers and mechanics working on the contract during the contract and 
shall make them available to the Government until 3 years after contract 
completion. The records shall contain the name and address of each 
employee, social security number, labor classifications, hourly rates of 
wages paid, daily and weekly number of hours worked, deductions made, 
and actual wages paid. The records need not duplicate those required for 
construction work by Department of Labor regulations at 29 CFR 5.5(a)(3) 
implementing the Davis-Bacon Act.
    (2) The Contractor and its subcontractors shall allow authorized 
representatives of the Contracting Officer or the Department of Labor to 
inspect, copy, or transcribe records maintained under paragraph (d)(1) 
of this clause. The Contractor or subcontractor also shall allow 
authorized representatives of the Contracting Officer or Department of 
Labor to interview employees in the workplace during working hours.
    (e) Subcontracts. The Contractor shall insert the provisions set 
forth in paragraphs (a) through (d) of this clause in subcontracts 
exceeding $100,000 and require subcontractors to include these 
provisions in any lower tier subcontracts. The Contractor shall be 
responsible for compliance by any subcontractor or lower-tier 
subcontractor with the provisions set forth in paragraphs (a) through 
(d) of this clause.

                             (End of clause)

[65 FR 46067, July 26, 2000]



Sec.  52.222-5  [Reserved]



Sec.  52.222-6  Davis-Bacon Act.

    As prescribed in 22.407(a), insert the following clause:

                       Davis-Bacon Act (FEB 1995)

    (a) All laborers and mechanics employed or working upon the site of 
the work will be paid unconditionally and not less often than once a 
week, and without subsequent deduction or rebate on any account (except 
such payroll deductions as are permitted by regulations issued by the 
Secretary of Labor under the Copeland Act (29 CFR part 3)), the full 
amount of wages and bona fide fringe benefits (or cash equivalents 
thereof) due at time of payment computed at rates not less than those 
contained in the wage determination of the Secretary of Labor which is 
attached hereto and made a part hereof, regardless of any contractual 
relationship which may be alleged to exist between the Contractor and 
such laborers and mechanics. Contributions made or costs reasonably 
anticipated for bona fide fringe benefits under section 1(b)(2) of the 
Davis-Bacon Act on behalf of laborers or mechanics are considered wages 
paid to such laborers or mechanics, subject to the provisions of 
paragraph (d) of

[[Page 128]]

this clause; also, regular contributions made or costs incurred for more 
than a weekly period (but not less often than quarterly) under plans, 
funds, or programs which cover the particular weekly period, are deemed 
to be constructively made or incurred during such period. Such laborers 
and mechanics shall be paid not less than the appropriate wage rate and 
fringe benefits in the wage determination for the classification of work 
actually performed, without regard to skill, except as provided in the 
clause entitled Apprentices and Trainees. Laborers or mechanics 
performing work in more than one classification may be compensated at 
the rate specified for each classification for the time actually worked 
therein; provided, that the employer's payroll records accurately set 
forth the time spent in each classification in which work is performed. 
The wage determination (including any additional classifications and 
wage rates conformed under paragraph (b) of this clause) and the Davis-
Bacon poster (WH-1321) shall be posted at all times by the Contractor 
and its subcontractors at the site of the work in a prominent and 
accessible place where it can be easily seen by the workers.
    (b)(1) The Contracting Officer shall require that any class of 
laborers or mechanics, which is not listed in the wage determination and 
which is to be employed under the contract shall be classified in 
conformance with the wage determination. The Contracting Officer shall 
approve an additional classification and wage rate and fringe benefits 
therefor only when all the following criteria have been met:
    (i) The work to be performed by the classification requested is not 
performed by a classification in the wage determination.
    (ii) The classification is utilized in the area by the construction 
industry.
    (iii) The proposed wage rate, including any bona fide fringe 
benefits, bears a reasonable relationship to the wage rates contained in 
the wage determination.
    (iv) With respect to helpers, such a classification prevails in the 
area in which the work is performed.
    (2) If the Contractor and the laborers and mechanics to be employed 
in the classification (if known), or their representatives, and the 
Contracting Officer agree on the classification and wage rate (including 
the amount designated for fringe benefits, where appropriate), a report 
of the action taken shall be sent by the Contracting Officer to the 
Administrator of the Wage and Hour Division, Employment Standards 
Administration, U.S. Department of Labor, Washington, DC 20210. The 
Administrator or an authorized representative will approve, modify, or 
disapprove every additional classification action within 30 days of 
receipt and so advise the Contracting Officer or will notify the 
Contracting Officer within the 30-day period that additional time is 
necessary.
    (3) In the event the Contractor, the laborers or mechanics to be 
employed in the classification, or their representatives, and the 
Contracting Officer do not agree on the proposed classification and wage 
rate (including the amount designated for fringe benefits, where 
appropriate), the Contracting Officer shall refer the questions, 
including the views of all interested parties and the recommendation of 
the Contracting Officer, to the Administrator of the Wage and Hour 
Division for Determination. The Administrator, or an authorized 
representative, will issue a determination within 30 days of receipt and 
so advise the Contracting Officer or will notify the Contracting Officer 
within the 30-day period that additional time is necessary.
    (4) The wage rate (including fringe benefits, where appropriate) 
determined pursuant to subparagraphs (b)(2) and (b)(3) of this clause 
shall be paid to all workers performing work in the classification under 
this contract from the first day on which work is performed in the 
classification.
    (c) Whenever the minimum wage rate prescribed in the contract for a 
class of laborers or mechanics includes a fringe benefit which is not 
expressed as an hourly rate, the Contractor shall either pay the benefit 
as stated in the wage determination or shall pay another bona fide 
fringe benefit or an hourly cash equivalent thereof.
    (d) If the Contractor does not make payments to a trustee or other 
third person, the Contractor may consider as part of the wages of any 
laborer or mechanic the amount of any costs reasonably anticipated in 
providing bona fide fringe benefits under a plan or program; provided, 
that the Secretary of Labor has found, upon the written request of the 
Contractor, that the applicable standards of the Davis-Bacon Act have 
been met. The Secretary of Labor may require the Contractor to set aside 
in a separate account assets for the meeting of obligations under the 
plan or program.

                             (End of clause)

[53 FR 4945, Feb. 18, 1988, as amended at 57 FR 44263, Sept. 24, 1992; 
59 FR 67038, Dec. 28, 1994]



Sec.  52.222-7  Withholding of Funds.

    As prescribed in 22.407(a), insert the following clause:

                     Withholding of Funds (FEB 1988)

    The Contracting Officer shall, upon his or her own action or upon 
written request of an authorized representative of the Department of 
Labor, withhold or cause to be withheld from the Contractor under this 
contract or any other Federal contract with the same

[[Page 129]]

Prime Contractor, or any other federally assisted contract subject to 
Davis-Bacon prevailing wage requirements, which is held by the same 
Prime Contractor, so much of the accrued payments or advances as may be 
considered necessary to pay laborers and mechanics, including 
apprentices, trainees, and helpers, employed by the Contractor or any 
subcontractor the full amount of wages required by the contract. In the 
event of failure to pay any laborer or mechanic, including any 
apprentice, trainee, or helper, employed or working on the site of the 
work, all or part of the wages required by the contract, the Contracting 
Officer may, after written notice to the Contractor, take such action as 
may be necessary to cause the suspension of any further payment, 
advance, or guarantee of funds until such violations have ceased.

                             (End of clause)

[53 FR 4945, Feb. 18, 1988]



Sec.  52.222-8  Payrolls and Basic Records.

    As prescribed in 22.407(a), insert the following clause:

                Payment for Overtime Premiums (FEB 1988)

    (a) Payrolls and basic records relating thereto shall be maintained 
by the Contractor during the course of the work and preserved for a 
period of 3 years thereafter for all laborers and mechanics working at 
the site of the work. Such records shall contain the name, address, and 
social security number of each such worker, his or her correct 
classification, hourly rates of wages paid (including rates of 
contributions or costs anticipated for bona fide fringe benefits or cash 
equivalents thereof of the types described in section 1(b)(2)(B) of the 
Davis-Bacon Act), daily and weekly number of hours worked, deductions 
made, and actual wages paid. Whenever the Secretary of Labor has found, 
under paragraph (d) of the clause entitled Davis-Bacon Act, that the 
wages of any laborer or mechanic include the amount of any costs 
reasonably anticipated in providing benefits under a plan or program 
described in section 1(b)(2)(B) of the Davis-Bacon Act, the Contractor 
shall maintain records which show that the commitment to provide such 
benefits is enforceable, that the plan or program is financially 
responsible, and that the plan or program has been communicated in 
writing to the laborers or mechanics affected, and records which show 
the costs anticipated or the actual cost incurred in providing such 
benefits. Contractors employing apprentices or trainees under approved 
programs shall maintain written evidence of the registration of 
apprenticeship programs and certification of trainee programs, the 
registration of the apprentices and trainees, and the ratios and wage 
rates prescribed in the applicable programs.
    (b)(1) The Contractor shall submit weekly for each week in which any 
contract work is performed a copy of all payrolls to the Contracting 
Officer. The payrolls submitted shall set out accurately and completely 
all of the information required to be maintained under paragraph (a) of 
this clause. This information may be submitted in any form desired. 
Optional Form WH-347 (Federal Stock Number 029-005-00014-1) is available 
for this purpose and may be purchased from the Superintendent of 
Documents, U.S. Government Printing Office, Washington, DC 20402. The 
Prime Contractor is responsible for the submission of copies of payrolls 
by all subcontractors.
    (2) Each payroll submitted shall be accompanied by a Statement of 
Compliance, signed by the Contractor or subcontractor or his or her 
agent who pays or supervises the payment of the persons employed under 
the contract and shall certify--
    (i) That the payroll for the payroll period contains the information 
required to be maintained under paragraph (a) of this clause and that 
such information is correct and complete;
    (ii) That each laborer or mechanic (including each helper, 
apprentice, and trainee) employed on the contract during the payroll 
period has been paid the full weekly wages earned, without rebate, 
either directly or indirectly, and that no deductions have been made 
either directly or indirectly from the full wages earned, other than 
permissible deductions as set forth in the Regulations, 29 CFR part 3; 
and
    (iii) That each laborer or mechanic has been paid not less than the 
applicable wage rates and fringe benefits or cash equivalents for the 
classification of work performed, as specified in the applicable wage 
determination incorporated into the contract.
    (3) The weekly submission of a properly executed certification set 
forth on the reverse side of Optional Form WH-347 shall satisfy the 
requirement for submission of the Statement of Compliance required by 
subparagraph (b)(2) of this clause.
    (4) The falsification of any of the certifications in this clause 
may subject the Contractor or subcontractor to civil or criminal 
prosecution under section 1001 of title 18 and section 3729 of title 31 
of the United States Code.
    (c) The Contractor or subcontractor shall make the records required 
under paragraph (a) of this clause available for inspection, copying, or 
transcription by the Contracting Officer or authorized representatives 
of the Contracting Officer or the Department of Labor. The Contractor or 
subcontractor shall permit the Contracting Officer or representatives of 
the Contracting Officer or the Department of Labor to interview 
employees

[[Page 130]]

during working hours on the job. If the Contractor or subcontractor 
fails to submit required records or to make them available, the 
Contracting Officer may, after written notice to the Contractor, take 
such action as may be necessary to cause the suspension of any further 
payment. Furthermore, failure to submit the required records upon 
request or to make such records available may be grounds for debarment 
action pursuant to 29 CFR 5.12.

                             (End of clause)

[53 FR 4945, Feb. 18, 1988]



Sec.  52.222-9  Apprentices and Trainees.

    As prescribed in 22.407(a), insert the following clause:

                   Apprentices and Trainees (FEB 1988)

    (a) Apprentices. Apprentices will be permitted to work at less than 
the predetermined rate for the work they performed when they are 
employed pursuant to and individually registered in a bona fide 
apprenticeship program registered with the U.S. Department of Labor, 
Employment and Training Administration, Bureau of Apprenticeship and 
Training, or with a State Apprenticeship Agency recognized by the 
Bureau, or if a person is employed in his or her first 90 days of 
probationary employment as an apprentice in such an apprenticeship 
program, who is not individually registered in the program, but who has 
been certified by the Bureau of Apprenticeship and Training or a State 
Apprenticeship Agency (where appropriate) to be eligible for 
probationary employment as an apprentice. The allowable ratio of 
apprentices to journeymen on the job site in any craft classification 
shall not be greater than the ratio permitted to the Contractor as to 
the entire work force under the registered program. Any worker listed on 
a payroll at an apprentice wage rate, who is not registered or otherwise 
employed as stated in this paragraph, shall be paid not less than the 
applicable wage determination for the classification of work actually 
performed. In addition, any apprentice performing work on the job site 
in excess of the ratio permitted under the registered program shall be 
paid not less than the applicable wage rate on the wage determination 
for the work actually performed. Where a Contractor is performing 
construction on a project in a locality other than that in which its 
program is registered, the ratios and wage rates (expressed in 
percentages of the journeyman's hourly rate) specified in the 
Contractor's or subcontractor's registered program shall be observed. 
Every apprentice must be paid at not less than the rate specified in the 
registered program for the apprentice's level of progress, expressed as 
a percentage of the journeyman hourly rate specified in the applicable 
wage determination. Apprentices shall be paid fringe benefits in 
accordance with the provisions of the apprenticeship program. If the 
apprenticeship program does not specify fringe benefits, apprentices 
must be paid the full amount of fringe benefits listed on the wage 
determination for the applicable classification. If the Administrator 
determines that a different practice prevails for the applicable 
apprentice classification, fringes shall be paid in accordance with that 
determination. In the event the Bureau of Apprenticeship and Training, 
or a State Apprenticeship Agency recognized by the Bureau, withdraws 
approval of an apprenticeship program, the Contractor will no longer be 
permitted to utilize apprentices at less than the applicable 
predetermined rate for the work performed until an acceptable program is 
approved.
    (b) Trainees. Except as provided in 29 CFR 5.16, trainees will not 
be permitted to work at less than the predetermined rate for the work 
performed unless they are employed pursuant to and individually 
registered in a program which has received prior approval, evidenced by 
formal certification by the U.S. Department of Labor, Employment and 
Training Administration. The ratio of trainees to journeymen on the job 
site shall not be greater than permitted under the plan approved by the 
Employment and Training Administration. Every trainee must be paid at 
not less than the rate specified in the approved program for the 
trainee's level of progress, expressed as a percentage of the journeyman 
hourly rate specified in the applicable wage determination. Trainees 
shall be paid fringe benefits in accordance with the provisions of the 
trainee program. If the trainee program does not mention fringe 
benefits, trainees shall be paid the full amount of fringe benefits 
listed in the wage determination unless the Administrator of the Wage 
and Hour Division determines that there is an apprenticeship program 
associated with the corresponding journeyman wage rate in the wage 
determination which provides for less than full fringe benefits for 
apprentices. Any employee listed on the payroll at a trainee rate who is 
not registered and participating in a training plan approved by the 
Employment and Training Administration shall be paid not less than the 
applicable wage rate in the wage determination for the classification of 
work actually performed. In addition, any trainee performing work on the 
job site in excess of the ratio permitted under the registered program 
shall be paid not less than the applicable wage rate in the wage 
determination for the work actually performed. In the event the 
Employment and Training Administration withdraws approval of a training 
program, the Contractor will no longer be permitted to

[[Page 131]]

utilize trainees at less than the applicable predetermined rate for the 
work performed until an acceptable program is approved.
    (c) Equal employment opportunity. The utilization of apprentices, 
trainees, and journeymen under this clause shall be in conformity with 
the equal employment opportunity requirements of Executive Order 11246, 
and 29 CFR part 30.

                             (End of clause)

[53 FR 4946, Feb. 18, 1988]



Sec.  52.222-10  Compliance With Copeland Act Requirements.

    As prescribed in 22.407(a), insert the following clause:

          Compliance With Copeland Act Requirements (FEB 1988)

    The Contractor shall comply with the requirements of 29 CFR part 3, 
which are hereby incorporated by reference in this contract.

                             (End of clause)

[53 FR 4947, Feb. 18, 1988]



Sec.  52.222-11  Subcontracts (Labor Standards).

    As prescribed in 22.407(a), insert the following clause:

                Subcontracts (Labor Standards) (FEB 1988)

    (a) The Contractor or subcontractor shall insert in any subcontracts 
the clauses entitled Davis-Bacon Act, Contract Work Hours and Safety 
Standards Act--Overtime Compensation, Apprentices and Trainees, Payrolls 
and Basic Records, Compliance with Copeland Act Requirements, 
Withholding of Funds, Subcontracts (Labor Standards), Contract 
Termination--Debarment, Disputes Concerning Labor Standards, Compliance 
with Davis-Bacon and Related Act Regulations, and Certification of 
Eligibility, and such other clauses as the Contracting Officer may, by 
appropriate instructions, require, and also a clause requiring 
subcontractors to include these clauses in any lower tier subcontracts. 
The Prime Contractor shall be responsible for compliance by any 
subcontractor or lower tier subcontractor with all the contract clauses 
cited in this paragraph.
    (b)(1) Within 14 days after award of the contract, the Contractor 
shall deliver to the Contracting Officer a completed Statement and 
Acknowledgment Form (SF 1413) for each subcontract, including the 
subcontractor's signed and dated acknowledgment that the clauses set 
forth in paragraph (a) of this clause have been included in the 
subcontract.
    (2) Within 14 days after the award of any subsequently awarded 
subcontract the Contractor shall deliver to the Contracting Officer an 
updated completed SF 1413 for such additional subcontract.

                             (End of clause)

[53 FR 4947, Feb. 18, 1988]



Sec.  52.222-12  Contract Termination--Debarment.

    As prescribed in 22.407(a), insert the following clause:

               Contract Termination--Debarment (FEB 1988)

    A breach of the contract clauses entitled Davis-Bacon Act, Contract 
Work Hours and Safety Standards Act--Overtime Compensation, Apprentices 
and Trainees, Payrolls and Basic Records, Compliance with Copeland Act 
Requirements, Subcontracts (Labor Standards), Compliance With Davis-
Bacon and Related Act Regulations, or Certification of Eligibility may 
be grounds for termination of the contract, and for debarment as a 
Contractor and subcontractor as provided in 29 CFR 5.12.

                             (End of clause)

[53 FR 4947, Feb. 18, 1988]



Sec.  52.222-13  Compliance with Davis-Bacon and Related Act Regulations.

    As prescribed in 22.407(a), insert the following clause:

   Compliance With Davis-Bacon and Related Act Regulations (FEB 1988)

    All rulings and interpretations of the Davis-Bacon and Related Acts 
contained in 29 CFR parts 1, 3, and, 5 are hereby incorporated by 
reference in this contract.

                             (End of clause)

[53 FR 4947, Feb. 18, 1988]



Sec.  52.222-14  Disputes Concerning Labor Standards.

    As prescribed in 22.407(a), insert the following clause:

             Disputes Concerning Labor Standards (FEB 1988)

    The United States Department of Labor has set forth in 29 CFR parts 
5, 6, and 7 procedures for resolving disputes concerning labor standards 
requirements. Such disputes shall be resolved in accordance with those

[[Page 132]]

procedures and not the Disputes clause of this contract. Disputes within 
the meaning of this clause include disputes between the Contractor (or 
any of its subcontractors) and the contracting agency, the U.S. 
Department of Labor, or the employees or their representatives.

                             (End of clause)

[53 FR 4947, Feb. 18, 1988]



Sec.  52.222-15  Certification of Eligibility.

    As prescribed in 22.407(a), insert the following clause:

                 Certification of Eligibility (FEB 1988)

    (a) By entering into this contract, the Contractor certifies that 
neither it (nor he or she) nor any person or firm who has an interest in 
the Contractor's firm is a person or firm ineligible to be awarded 
Government contracts by virtue of section 3(a) of the Davis-Bacon Act or 
29 CFR 5.12(a)(1).
    (b) No part of this contract shall be subcontracted to any person or 
firm ineligible for award of a Government contract by virtue of section 
3(a) of the Davis-Bacon Act or 29 CFR 5.12(a)(1).
    (c) The penalty for making false statements is prescribed in the 
U.S. Criminal Code, 18 U.S.C. 1001.

                             (End of clause)

[53 FR 4947, Feb. 18, 1988]



Sec.  52.222-16  Approval of Wage Rates.

    As prescribed in 22.407(b), insert the following clause:

                    Approval of Wage Rates (FEB 1988)

    All straight time wage rates, and overtime rates based thereon, for 
laborers and mechanics engaged in work under this contract must be 
submitted for approval in writing by the head of the contracting 
activity or a representative expressly designated for this purpose, if 
the straight time wages exceed the rates for corresponding 
classifications contained in the applicable Davis-Bacon Act minimum wage 
determination included in the contract. Any amount paid by the 
Contractor to any laborer or mechanic in excess of the agency approved 
wage rate shall be at the expense of the Contractor and shall not be 
reimbursed by the Government. If the Government refuses to authorize the 
use of the overtime, the Contractor is not released from the obligation 
to pay employees at the required overtime rates for any overtime 
actually worked.

                             (End of clause)

[53 FR 4947, Feb. 18, 1988]



Sec.  52.222-17  Labor Standards for Construction Work--Facilities Contracts.

    As prescribed in 22.407(d), insert the following clause:

 Labor Standards for Construction Work--Facilities Contracts (FEB 1988)

    (a) In the event that construction, alteration, or repair (including 
painting and decorating) of public buildings or public works is to be 
performed hereunder, the Contractor shall comply with the following 
listed clauses of the Federal Acquisition Regulation in performance of 
such work:
    (1) Contract Work Hours and Safety Standards Act--Overtime 
Compensation at 52.222-4.
    (2) Davis-Bacon Act at 52.222-6.
    (3) Withholding of Funds at 52.222-7.
    (4) Payrolls and Basic Records at 52.222-8.
    (5) Apprentices and Trainees at 52.222-9.
    (6) Compliance With Copeland Act Requirements at 52.222-10.
    (7) Subcontracts (Labor Standards) at 52.222-11.
    (8) Contract Termination--Debarment at 52.222-12.
    (9) Compliance with Davis-Bacon and Related Act Regulations at 
52.222-13.
    (10) Disputes Concerning Labor Standards at 52.222-14.
    (11) Certification of Eligibility at 52.222-15.
    (b) Upon determination by the Contracting Officer that the Davis-
Bacon Act is applicable to any item of work to be performed hereunder, a 
determination of the prevailing wage rates shall be incorporated into 
the contract by modification.
    (c) No construction, alteration, or repair (including painting and 
decorating) of public buildings or public works shall be performed under 
this contract without incorporation of the wage determination unless the 
Contracting Officer authorizes the start of work because of unusual or 
emergency situations, in which case the wage determination shall be 
incorporated as soon as possible and made retroactive to the start of 
the work.

                             (End of clause)

[53 FR 4947, Feb. 18, 1988]



Sec.  52.222-18   Certification Regarding Knowledge of Child Labor for Listed End Products.

    As prescribed in 22.1505(a), insert the following provision:

[[Page 133]]

Certification Regarding Knowledge of Child Labor for Listed End Products 
                               (FEB 2001)

    (a) Definition.
    Forced or indentured child labor means all work or service--
    (1) Exacted from any person under the age of 18 under the menace of 
any penalty for its nonperformance and for which the worker does not 
offer himself voluntarily; or
    (2) Performed by any person under the age of 18 pursuant to a 
contract the enforcement of which can be accomplished by process or 
penalties.
    (b) Listed end products. The following end product(s) being acquired 
under this solicitation is (are) included in the List of Products 
Requiring Contractor Certification as to Forced or Indentured Child 
Labor, identified by their country of origin. There is a reasonable 
basis to believe that listed endproducts from the listed countries of 
origin may have been mined, produced, or manufactured by forced or 
indentured child labor.

                           Listed End Product

________________________________________________________________________
________________________________________________________________________

                       Listed Countries of Origin

________________________________________________________________________
________________________________________________________________________
    (c) Certification. The Government will not make award to an offeror 
unless the offeror, by checking the appropriate block, certifies to 
either paragraph (c)(1) or paragraph (c)(2) of this provision.
    [squ] (1) The offeror will not supply any end product listed in 
paragraph (b) of this provision that was mined, produced, or 
manufactured in a corresponding country as listed for that end product.
    [squ] (2) The offeror may supply an end product listed in paragraph 
(b) of this provision that was mined, produced, or manufactured in the 
corresponding country as listed for that product. The offeror certifies 
that it has made a good faith effort to determine whether forced or 
indentured child labor was used to mine, produce, or manufacture such 
end product. On the basis of those efforts, the offeror certifies that 
it is not aware of any such use of child labor.

                           (End of provision)

[66 FR 5349, Jan. 18, 2001]



Sec.  52.222-19  Child Labor--Cooperation with Authorities and Remedies.

    As prescribed in 22.1505(b), insert the following clause:

    Child Labor--Cooperation With Authorities and Remedies (SEP 2002)

    (a) Applicability. This clause does not apply to the extent that the 
Contractor is supplying end products mined, produced, or manufactured 
in--
    (1) Canada, and the anticipated value of the acquisition is $25,000 
or more;
    (2) Israel, and the anticipated value of the acquisition is $50,000 
or more;
    (3) Mexico, and the anticipated value of the acquisition is $56,190 
or more; or
    (4) Aruba, Austria, Belgium, Denmark, Finland, France, Germany, 
Greece, Hong Kong, Iceland, Ireland, Italy, Japan, Korea, Liechtenstein, 
Luxembourg, Netherlands, Norway, Portugal, Singapore, Spain, Sweden, 
Switzerland, or the United Kingdom and the anticipated value of the 
acquisition is $169,000 or more.
    (b) Cooperation with Authorities. To enforce the laws prohibiting 
the manufacture or importation of products mined, produced, or 
manufactured by forced or indentured child labor, authorized officials 
may need to conduct investigations to determine whether forced or 
indentured child labor was used to mine, produce, or manufacture any 
product furnished under this contract. If the solicitation includes the 
provision 52.222-18, Certification Regarding Knowledge of Child Labor 
for Listed End Products, or the equivalent at 52.212-3(i), the 
Contractor agrees to cooperate fully with authorized officials of the 
contracting agency, the Department of the Treasury, or the Department of 
Justice by providing reasonable access to records, documents, persons, 
or premises upon reasonable request by the authorized officials.
    (c) Violations. The Government may impose remedies set forth in 
paragraph (d) for the following violations:
    (1) The Contractor has submitted a false certification regarding 
knowledge of the use of forced or indentured child labor for listed end 
products.
    (2) The Contractor has failed to cooperate, if required, in 
accordance with paragraph (b) of this clause, with an investigation of 
the use of forced or indentured child labor by an Inspector General, 
Attorney General, or the Secretary of the Treasury.
    (3) The Contractor uses forced or indentured child labor in its 
mining, production, or manufacturing processes.
    (4) The Contractor has furnished under the contract end products or 
components that have been mined, produced, or manufactured wholly or in 
part by forced or indentured child labor. (The Government will not 
pursue remedies at paragraph (d)(2) or paragraph (d)(3) of this clause 
unless sufficient evidence indicates that the Contractor knew of the 
violation.)
    (d) Remedies. (1) The Contracting Officer may terminate the 
contract.

[[Page 134]]

    (2) The suspending official may suspend the Contractor in accordance 
with procedures in FAR Subpart 9.4.
    (3) The debarring official may debar the Contractor for a period not 
to exceed 3 years in accordance with the procedures in FAR Subpart 9.4.

                             (End of clause)

[66 FR 5349, Jan. 18, 2001, as amended at 66 FR 65371, Dec. 18, 2001; 67 
FR 56124, Aug. 30, 2002]



Sec.  52.222-20  Walsh-Healey Public Contracts Act.

    As prescribed in 22.610, insert the following clause in 
solicitations and contracts covered by the Act:

              Walsh-Healey Public Contracts Act (DEC 1996)

    If this contract is for the manufacture or furnishing of materials, 
supplies, articles or equipment in an amount that exceeds or may exceed 
$10,000, and is subject to the Walsh-Healey Public Contracts Act, as 
amended (41 U.S.C. 35-45), the following terms and conditions apply:
    (a) All stipulations required by the Act and regulations issued by 
the Secretary of Labor (41 CFR chapter 50) are incorporated by 
reference. These stipulations are subject to all applicable rulings and 
interpretations of the Secretary of Labor that are now, or may 
hereafter, be in effect.
    (b) All employees whose work relates to this contract shall be paid 
not less than the minimum wage prescribed by regulations issued by the 
Secretary of Labor (41 CFR 50-202.2). Learners, student learners, 
apprentices, and handicapped workers may be employed at less than the 
prescribed minimum wage (see 41 CFR 50-202.3) to the same extent that 
such employment is permitted under Section 14 of the Fair Labor 
Standards Act (41 U.S.C. 40).

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 67411, Dec. 20, 1996]



Sec.  52.222-21  Prohibition of segregated facilities.

    As prescribed in 22.810(a)(1), insert the following clause:

             Prohibition of Segregated Facilities (FEB 1999)

    (a) Segregated facilities, as used in this clause, means any waiting 
rooms, work areas, rest rooms and wash rooms, restaurants and other 
eating areas, time clocks, locker rooms and other storage or dressing 
areas, parking lots, drinking fountains, recreation or entertainment 
areas, transportation, and housing facilities provided for employees, 
that are segregated by explicit directive or are in fact segregated on 
the basis of race, color, religion, sex, or national origin because of 
written or oral policies or employee custom. The term does not include 
separate or single-user rest rooms or necessary dressing or sleeping 
areas provided to assure privacy between the sexes.
    (b) The Contractor agrees that it does not and will not maintain or 
provide for its employees any segregated facilities at any of its 
establishments, and that it does not and will not permit its employees 
to perform their services at any location under its control where 
segregated facilities are maintained. The Contractor agrees that a 
breach of this clause is a violation of the Equal Opportunity clause in 
this contract.
    (c) The Contractor shall include this clause in every subcontract 
and purchase order that is subject to the Equal Opportunity clause of 
this contract.

                             (End of clause)

[53 FR 70285, Dec. 18, 1998]



Sec.  52.222-22  Previous Contracts and Compliance Reports.

    As prescribed in 22.810(a)(2), insert the following provision:

          Previous Contracts and Compliance Reports (FEB 1999)

    The offeror represents that--
    (a) It squ; has, [squ] has not participated in a previous contract 
or subcontract subject to the Equal Opportunity clause of this 
solicitation;
    (b) It [squ] has, [squ] has not, filed all required compliance 
reports; and
    (c) Representations indicating submission of required compliance 
reports, signed by proposed subcontractors, will be obtained before 
subcontract awards.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 63 FR 70286, Dec. 18, 1998]



Sec.  52.222-23  Notice of Requirement for Affirmative Action to Ensure Equal 
Employment Opportunity for Construction.

    As prescribed in 22.810(b), insert the following provision:

[[Page 135]]

Notice of Requirement for Affirmative Action To Ensure Equal Employment 
                 Opportunity for Construction (FEB 1999)

    (a) The offeror's attention is called to the Equal Opportunity 
clause and the Affirmative Action Compliance Requirements for 
Construction clause of this solicitation.
    (b) The goals for minority and female participation, expressed in 
percentage terms for the Contractor's aggregate workforce in each trade 
on all construction work in the covered area, are as follows:

------------------------------------------------------------------------
  Goals for minority participation    Goals for female participation for
           for each trade                         each trade
------------------------------------------------------------------------
----------------                     ----------------
[Contracting Officer shall insert    [Contracting Officer shall insert
 goals]                               goals]
------------------------------------------------------------------------

    These goals are applicable to all the Contractor's construction work 
performed in the covered area. If the Contractor performs construction 
work in a geographical area located outside of the covered area, the 
Contractor shall apply the goals established for the geographical area 
where the work is actually performed. Goals are published periodically 
in the Federal Register in notice form, and these notices may be 
obtained from any Office of Federal Contract Compliance Programs office.
    (c) The Contractor's compliance with Executive Order 11246, as 
amended, and the regulations in 41 CFR 60-4 shall be based on (1) its 
implementation of the Equal Opportunity clause, (2) specific affirmative 
action obligations required by the clause entitled Affirmative Action 
Compliance Requirements for Construction, and (3) its efforts to meet 
the goals. The hours of minority and female employment and training must 
be substantially uniform throughout the length of the contract, and in 
each trade. The Contractor shall make a good faith effort to employ 
minorities and women evenly on each of its projects. The transfer of 
minority or female employees or trainees from Contractor to Contractor, 
or from project to project, for the sole purpose of meeting the 
Contractor's goals shall be a violation of the contract, Executive Order 
11246, as amended, and the regulations in 41 CFR 60-4. Compliance with 
the goals will be measured against the total work hours performed.
    (d) The Contractor shall provide written notification to the Deputy 
Assistant Secretary for Federal Contract Compliance, U.S. Department of 
Labor, within 10 working days following award of any construction 
subcontract in excess of $10,000 at any tier for construction work under 
the contract resulting from this solicitation. The notification shall 
list the --
    (2) Name, address, and telephone number of the subcontractor;
    (i) Employer's identification number of the subcontractor;
    (3) Estimated dollar amount of the subcontract;
    (4) Estimated starting and completion dates of the subcontract; and
    (5) Geographical area in which the subcontract is to be performed.
    (e) As used in this Notice, and in any contract resulting from this 
solicitation, the covered area is ------ [Contracting Officer shall 
insert description of the geographical areas where the contract is to be 
performed, giving the State, county, and city].

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 38518, Sept. 18, 1990; 
63 FR 70286, Dec. 18, 1998]



Sec.  52.222-24  Preaward On-Site Equal Opportunity Compliance Evaluation.

    As prescribed in 22.810(c), insert the following provision:

   Preaward On-Site Equal Opportunity Compliance Evaluation (FEB 1999)

    If a contract in the amount of $10 million or more will result from 
this solicitation, the prospective Contractor and its known first-tier 
subcontractors with anticipated subcontracts of $10 million or more 
shall be subject to a preaward compliance evaluation by the Office of 
Federal Contract Compliance Programs (OFCCP), unless, within the 
preceding 24 months, OFCCP has conducted an evaluation and found the 
prospective Contractor and subcontractors to be in compliance with 
Executive Order 11246.

                           (End of provision)

[63 FR 70286, Dec. 18, 1998]



Sec.  52.222-25  Affirmative Action Compliance.

    As prescribed in 22.810(d), insert the following provision:

                Affirmative Action Compliance (APR 1984)

    The offeror represents that (a) it [squ] has developed and has on 
file, [squ] has not developed and does not have on file, at each 
establishment, affirmative action programs required by the rules and 
regulations of the Secretary of Labor (41 CFR 60-1 and 60-2), or (b) it 
[squ] has not previously had contracts subject to the written 
affirmative action programs requirement of the rules and regulations of 
the Secretary of Labor.

[[Page 136]]

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 63 FR 70286, Dec. 18, 1998]



Sec.  52.222-26  Equal Opportunity.

    As prescribed in 22.810(e), insert the following clause:

                      Equal Opportunity (APR 2002)

    (a) Definition. United States, as used in this clause, means the 50 
States, the District of Columbia, Puerto Rico, the Northern Mariana 
Islands, American Samoa, Guam, the U.S. Virgin Islands, and Wake Island.
    (b) If, during any 12-month period (including the 12 months 
preceding the award of this contract), the Contractor has been or is 
awarded nonexempt Federal contracts and/or subcontracts that have an 
aggregate value in excess of $10,000, the Contractor shall comply with 
paragraphs (b)(1) through (b)(11) of this clause, except for work 
performed outside the United States by employees who were not recruited 
within the United States. Upon request, the Contractor shall provide 
information necessary to determine the applicability of this clause.
    (1) The Contractor shall not discriminate against any employee or 
applicant for employment because of race, color, religion, sex, or 
national origin. However, it shall not be a violation of this clause for 
the Contractor to extend a publicly announced preference in employment 
to Indians living on or near an Indian reservation, in connection with 
employment opportunities on or near an Indian reservation, as permitted 
by 41 CFR 60-1.5.
    (2) The Contractor shall take affirmative action to ensure that 
applicants are employed, and that employees are treated during 
employment, without regard to their race, color, religion, sex, or 
national origin. This shall include, but not be limited to, (i) 
employment, (ii) upgrading, (iii) demotion, (iv) transfer, (v) 
recruitment or recruitment advertising, (vi) layoff or termination, 
(vii) rates of pay or other forms of compensation, and (viii) selection 
for training, including apprenticeship.
    (3) The Contractor shall post in conspicuous places available to 
employees and applicants for employment the notices to be provided by 
the Contracting Officer that explain this clause.
    (4) The Contractor shall, in all solicitations or advertisements for 
employees placed by or on behalf of the Contractor, state that all 
qualified applicants will receive consideration for employment without 
regard to race, color, religion, sex, or national origin.
    (5) The Contractor shall send, to each labor union or representative 
of workers with which it has a collective bargaining agreement or other 
contract or understanding, the notice to be provided by the Contracting 
Officer advising the labor union or workers' representative of the 
Contractor's commitments under this clause, and post copies of the 
notice in conspicuous places available to employees and applicants for 
employment.
    (6) The Contractor shall comply with Executive Order 11246, as 
amended, and the rules, regulations, and orders of the Secretary of 
Labor.
    (7) The Contractor shall furnish to the contracting agency all 
information required by Executive Order 11246, as amended, and by the 
rules, regulations, and orders of the Secretary of Labor. The Contractor 
shall also file Standard Form 100 (EEO-1), or any successor form, as 
prescribed in 41 CFR part 60-1. Unless the Contractor has filed within 
the 12 months preceding the date of contract award, the Contractor 
shall, within 30 days after contract award, apply to either the regional 
Office of Federal Contract Compliance Programs (OFCCP) or the local 
office of the Equal Employment Opportunity Commission for the necessary 
forms.
    (8) The Contractor shall permit access to its premises, during 
normal business hours, by the contracting agency or the OFCCP for the 
purpose of conducting on-site compliance evaluations and complaint 
investigations. The Contractor shall permit the Government to inspect 
and copy any books, accounts, records (including computerized records), 
and other material that may be relevant to the matter under 
investigation and pertinent to compliance with Executive Order 11246, as 
amended, and rules and regulations that implement the Executive Order.
    (9) If the OFCCP determines that the Contractor is not in compliance 
with this clause or any rule, regulation, or order of the Secretary of 
Labor, this contract may be canceled, terminated, or suspended in whole 
or in part and the Contractor may be declared ineligible for further 
Government contracts, under the procedures authorized in Executive Order 
11246, as amended. In addition, sanctions may be imposed and remedies 
invoked against the Contractor as provided in Executive Order 11246, as 
amended; in the rules, regulations, and orders of the Secretary of 
Labor; or as otherwise provided by law.
    (10) The Contractor shall include the terms and conditions of 
subparagraphs (b)(1) through (11) of this clause in every subcontract or 
purchase order that is not exempted by the rules, regulations, or orders 
of the Secretary of Labor issued under Executive Order 11246, as 
amended, so that these terms and conditions will be binding upon each 
subcontractor or vendor.
    (11) The Contractor shall take such action with respect to any 
subcontract or purchase order as the contracting officer may direct

[[Page 137]]

as a means of enforcing these terms and conditions, including sanctions 
for noncompliance; provided, that if the Contractor becomes involved in, 
or is threatened with, litigation with a subcontractor or vendor as a 
result of any direction, the Contractor may request the United States to 
enter into the litigation to protect the interests of the United States.
    (c) Notwithstanding any other clause in this contract, disputes 
relative to this clause will be governed by the procedures in 41 CFR 60-
1.1.

                             (End of clause)

    Alternate I (FEB 1999). As prescribed in 22.810(e), add the 
following as a preamble to the clause:

    Notice. The following terms of this clause are waived for this 
contract: ------ [Contracting Officer shall list terms].

[48 FR 42478, Sept. 19, 1983, as amended at 63 FR 70286, Dec. 18, 1998; 
67 FR 13067, Mar. 20, 2002]



Sec.  52.222-27  Affirmative Action Compliance Requirements for Construction.

    As prescribed in 22.810(f), insert the following clause:

 Affirmative Action Compliance Requirements for Construction (FEB 1999)

    (a) Definitions.
    Covered area, as used in this clause, means the geographical area 
described in the solicitation for this contract.
    Deputy Assistant Secretary, as used in this clause, means the Deputy 
Assistant Secretary for Federal Contract Compliance, U.S. Department of 
Labor, or a designee.
    Employer identification number, as used in this clause, means the 
Federal Social Security number used on the employer's quarterly 
Federaltax return, U.S. Treasury Department Form 941.
    Minority, as used in this clause, means--
    (1) American Indian or Alaskan Native (all persons having origins in 
any of the original peoples of North America and maintaining 
identifiable tribal affiliations through membership and participation or 
community identification).
    (2) Asian and Pacific Islander (all persons having origins in any of 
the original peoples of the Far East, Southeast Asia, the Indian 
Subcontinent, or the Pacific Islands);
    (3) Black (all persons having origins in any of the black African 
racial groups not of Hispanic origin); and
    (4) Hispanic (all persons of Mexican, Puerto Rican, Cuban, Central 
or South American, or other Spanish culture or origin, regardless of 
race).
    (b) If the Contractor, or a subcontractor at any tier, subcontracts 
a portion of the work involving any construction trade, each such 
subcontract in excess of $10,000 shall include this clause and the 
Notice containing the goals for minority and female participation stated 
in the solicitation for this contract.
    (c) If the Contractor is participating in a Hometown Plan (41 CFR 
60-4) approved by the U.S. Department of Labor in a covered area, either 
individually or through an association, its affirmative action 
obligations on all work in the plan area (including goals) shall comply 
with the plan for those trades that have unions participating in the 
plan. Contractors must be able to demonstrate participation in, and 
compliance with, the provisions of the plan. Each Contractor or 
subcontractor participating in an approved plan is also required to 
comply with its obligations under the Equal Opportunity clause, and to 
make a good faith effort to achieve each goal under the plan in each 
trade in which it has employees. The overall good-faith performance by 
other Contractors or subcontractors toward a goal in an approved plan 
does not excuse any Contractor's or subcontractor's failure to make 
good-faith efforts to achieve the plan's goals.
    (d) The Contractor shall implement the affirmative action procedures 
in subparagraphs (g)(1) through (16) of this clause. The goals stated in 
the solicitation for this contract are expressed as percentages of the 
total hours of employment and training of minority and female 
utilization that the Contractor should reasonably be able to achieve in 
each construction trade in which it has employees in the covered area. 
If the Contractor performs construction work in a geographical area 
located outside of the covered area, it shall apply the goals 
established for the geographical area where that work is actually 
performed. The Contractor is expected to make substantially uniform 
progress toward its goals in each craft.
    (e) Neither the terms and conditions of any collective bargaining 
agreement, nor the failure by a union with which the Contractor has a 
collective bargaining agreement, to refer minorities or women shall 
excuse the Contractor's obligations under this clause, Executive Order 
11246, as amended, or the regulations thereunder.
    (f) In order for the nonworking training hours of apprentices and 
trainees to be counted in meeting the goals, apprentices and trainees 
must be employed by the Contractor during the training period, and the 
Contractor must have made a commitment to employ the apprentices and 
trainees at the completion of their training, subject to the 
availability of employment opportunities. Trainees must be trained 
pursuant to training programs approved by the U.S. Department of Labor.

[[Page 138]]

    (g) The Contractor shall take affirmative action to ensure equal 
employment opportunity. The evaluation of the Contractor's compliance 
with this clause shall be based upon its effort to achieve maximum 
results from its actions. The Contractor shall document these efforts 
fully and implement affirmative action steps at least as extensive as 
the following:
    (1) Ensure a working environment free of harassment, intimidation, 
and coercion at all sites and in all facilities where the Contractor's 
employees are assigned to work. The Contractor, if possible, will assign 
two or more women to each construction project. The Contractor shall 
ensure that foremen, superintendents, and other onsite supervisory 
personnel are aware of and carry out the Contractor's obligation to 
maintain such a working environment, with specific attention to minority 
or female individuals working at these sites or facilities.
    (2) Establish and maintain a current list of sources for minority 
and female recruitment. Provide written notification to minority and 
female recruitment sources and community organizations when the 
Contractor or its unions have employment opportunities available, and 
maintain a record of the organizations' responses.
    (3) Establish and maintain a current file of the names, addresses, 
and telephone numbers of each minority and female off-the-street 
applicant, referrals of minorities or females from unions, recruitment 
sources, or community organizations, and the action taken with respect 
to each individual. If an individual was sent to the union hiring hall 
for referral and not referred back to the Contractor by the union or, if 
referred back, not employed by the Contractor, this shall be documented 
in the file, along with whatever additional actions the Contractor may 
have taken.
    (4) Immediately notify the Deputy Assistant Secretary when the union 
or unions with which the Contractor has a collective bargaining 
agreement has not referred back to the Contractor a minority or woman 
sent by the Contractor, or when the Contractor has other information 
that the union referral process has impeded the Contractor's efforts to 
meet its obligations.
    (5) Develop on-the-job training opportunities and/or participate in 
training programs for the area that expressly include minorities and 
women, including upgrading programs and apprenticeship and trainee 
programs relevant to the Contractor's employment needs, especially those 
programs funded or approved by the Department of Labor. The Contractor 
shall provide notice of these programs to the sources compiled under 
subparagraph (g)(2) of this clause.
    (6) Disseminate the Contractor's equal employment policy by--
    (i) Providing notice of the policy to unions and to training, 
recruitment, and outreach programs, and requesting their cooperation in 
assisting the Contractor in meeting its contract obligations;
    (ii) Including the policy in any policy manual and in collective 
bargaining agreements;
    (iii) Publicizing the policy in the company newspaper, annual 
report, etc.;
    (iv) Reviewing the policy with all management personnel and with all 
minority and female employees at least once a year; and
    (v) Posting the policy on bulletin boards accessible to employees at 
each location where construction work is performed.
    (7) Review, at least annually, the Contractor's equal employment 
policy and affirmative action obligations with all employees having 
responsibility for hiring, assignment, layoff, termination, or other 
employment decisions. Conduct review of this policy with all on-site 
supervisory personnel before initiating construction work at a job site. 
A written record shall be made and maintained identifying the time and 
place of these meetings, persons attending, subject matter discussed, 
and disposition of the subject matter.
    (8) Disseminate the Contractor's equal employment policy externally 
by including it in any advertising in the news media, specifically 
including minority and female news media. Provide written notification 
to, and discuss this policy with, other Contractors and subcontractors 
with which the Contractor does or anticipates doing business.
    (9) Direct recruitment efforts, both oral and written, to minority, 
female, and community organizations, to schools with minority and female 
students, and to minority and female recruitment and training 
organizations serving the Contractor's recruitment area and employment 
needs. Not later than 1 month before the date for acceptance of 
applications for apprenticeship or training by any recruitment source, 
send written notification to organizations such as the above, describing 
the openings, screening procedures, and tests to be used in the 
selection process.
    (10) Encourage present minority and female employees to recruit 
minority persons and women. Where reasonable, provide after-school, 
summer, and vacation employment to minority and female youth both on the 
site and in other areas of the Contractor's workforce.
    (11) Validate all tests and other selection requirements where 
required under 41 CFR 60-3.
    (12) Conduct, at least annually, an inventory and evaluation at 
least of all minority and female personnel for promotional 
opportunities. Encourage these employees to seek or to prepare for, 
through appropriate training, etc., opportunities for promotion.
    (13) Ensure that seniority practices, job classifications, work 
assignments, and other

[[Page 139]]

personnel practices, do not have a discriminatory effect by continually 
monitoring all personnel and employment-related activities to ensure 
that the Contractor's obligations under this contract are being carried 
out.
    (14) Ensure that all facilities and company activities are 
nonsegregated except that separate or single-user rest rooms and 
necessary dressing or sleeping areas shall be provided to assure privacy 
between the sexes.
    (15) Maintain a record of solicitations for subcontracts for 
minority and female construction contractors and suppliers, including 
circulation of solicitations to minority and female contractor 
associations and other business associations.
    (16) Conduct a review, at least annually, of all supervisors' 
adherence to and performance under the Contractor's equal employment 
policy and affirmative action obligations.
    (h) The Contractor is encouraged to participate in voluntary 
associations that may assist in fulfilling one or more of the 
affirmative action obligations contained in subparagraphs (g)(1) through 
(16) of this clause. The efforts of a contractor association, joint 
contractor-union, contractor-community, or similar group of which the 
contractor is a member and participant may be asserted as fulfilling one 
or more of its obligations under subparagraphs (g)(1) through (16) of 
this clause, provided the Contractor--
    (1) Actively participates in the group;
    (2) Makes every effort to ensure that the group has a positive 
impact on the employment of minorities and women in the industry;
    (3) Ensures that concrete benefits of the program are reflected in 
the Contractor's minority and female workforce participation;
    (4) Makes a good-faith effort to meet its individual goals and 
timetables; and
    (5) Can provide access to documentation that demonstrates the 
effectiveness of actions taken on behalf of the Contractor. The 
obligation to comply is the Contractor's, and failure of such a group to 
fulfill an obligation shall not be a defense for the Contractor's 
noncompliance.
    (i) A single goal for minorities and a separate single goal for 
women shall be established. The Contractor is required to provide equal 
employment opportunity and to take affirmative action for all minority 
groups, both male and female, and all women, both minority and 
nonminority. Consequently, the Contractor may be in violation of 
Executive Order 11246, as amended, if a particular group is employed in 
a substantially disparate manner.
    (j) The Contractor shall not use goals or affirmative action 
standards to discriminate against any person because of race, color, 
religion, sex, or national origin.
    (k) The Contractor shall not enter into any subcontract with any 
person or firm debarred from Government contracts under Executive Order 
11246, as amended.
    (l) The Contractor shall carry out such sanctions and penalties for 
violation of this clause and of the Equal Opportunity clause, including 
suspension, termination, and cancellation of existing subcontracts, as 
may be imposed or ordered under Executive Order 11246, as amended, and 
its implementing regulations, by the OFCCP. Any failure to carry out 
these sanctions and penalties as ordered shall be a violation of this 
clause and Executive Order 11246, as amended.
    (m) The Contractor in fulfilling its obligations under this clause 
shall implement affirmative action procedures at least as extensive as 
those prescribed in paragraph (g) of this clause, so as to achieve 
maximum results from its efforts to ensure equal employment opportunity. 
If the Contractor fails to comply with the requirements of Executive 
Order 11246, as amended, the implementing regulations, or this clause, 
the Deputy Assistant Secretary shall take action as prescribed in 41 CFR 
60-4.8.
    (n) The Contractor shall designate a responsible official to--
    (1) Monitor all employment-related activity to ensure that the 
Contractor's equal employment policy is being carried out;
    (2) Submit reports as may be required by the Government; and
    (3) Keep records that shall at least include for each employee the 
name, address, telephone number, construction trade, union affiliation 
(if any), employee identification number, social security number, race, 
sex, status (e.g., mechanic, apprentice, trainee, helper, or laborer), 
dates of changes in status, hours worked per week in the indicated 
trade, rate of pay, and locations at which the work was performed. 
Records shall be maintained in an easily understandable and retrievable 
form; however, to the degree that existing records satisfy this 
requirement, separate records are not required to be maintained.
    (o) Nothing contained herein shall be construed as a limitation upon 
the application of other laws that establish different standards of 
compliance or upon the requirements for the hiring of local or other 
area residents (e.g., those under the Public Works Employment Act of 
1977 and the Community Development Block Grant Program).

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 38518, Sept. 18, 1990; 
63 FR 70286, Dec. 18, 1998]

[[Page 140]]



Sec.  52.222-28  [Reserved]



Sec.  52.222-29  Notification of visa denial.

    As prescribed in 22.810(g), insert the following clause:

                 Notification of Visa Denial (June 2003)

    It is a violation of Executive Order 11246 for a Contractor to 
refuse to employ any applicant or not to assign any person hired in the 
United States, Puerto Rico, the Northern Mariana Islands, American 
Samoa, Guam, the U.S. Virgin Islands, or Wake Island, on the basis that 
the individual's race, color, religion, sex, or national origin is not 
compatible with the policies of the country where or for whom the work 
will be performed (41 CFR 60-1.10). The Contractor shall notify the U.S. 
Department of State, Assistant Secretary, Bureau of Political-Military 
Affairs (PM), 2201 C Street NW., Room 6212, Washington, DC 20520, and 
the U.S. Department of Labor, Deputy Assistant Secretary for Federal 
Contract Compliance, when it has knowledge of any employee or potential 
employee being denied an entry visa to a country where this contract 
will be performed, and it believes the denial is attributable to the 
race, color, religion, sex, or national origin of the employee or 
potential employee.

(End of clause)

[68 FR 28085, May 22, 2003]



Sec.  52.222-30  Davis-Bacon Act--Price Adjustment (None or Separately Specified Method).

    As prescribed in 22.407(e), insert the following clause:

Davis-Bacon Act--Price Adjustment (None or Separately Specified Method) 
                               (DEC 2001)

    (a) The wage determination issued under the Davis-Bacon Act by the 
Administrator, Wage and Hour Division, Employment Standards 
Administration, U.S. Department of Labor, that is effective for an 
option to extend the term of the contract, will apply to that option 
period.
    (b) The Contracting Officer will make no adjustment in contract 
price, other than provided for elsewhere in this contract, to cover any 
increases or decreases in wages and benefits as a result of--
    (1) Incorporation of the Department of Labor's wage determination 
applicable at the exercise of the option to extend the term of the 
contract;
    (2) Incorporation of a wage determination otherwise applied to the 
contract by operation of law; or
    (3) An increase in wages and benefits resulting from any other 
requirement applicable to workers subject to the Davis-Bacon Act.

                             (End of clause)

[66 FR 53482, Oct. 22, 2001]



Sec.  52.222-31  Davis-Bacon Act--Price Adjustment (Percentage Method).

    As prescribed in 22.407(f), insert the following clause:

    Davis-Bacon Act--Price Adjustment (Percentage Method) (DEC 2001)

    (a) The wage determination issued under the Davis-Bacon Act by the 
Administrator, Wage and Hour Division, Employment Standards 
Administration, U.S. Department of Labor, that is effective for an 
option to extend the term of the contract, will apply to that option 
period.
    (b) The Contracting Officer will adjust the portion of the contract 
price or contract unit price(s) containing the labor costs subject to 
the Davis-Bacon Act to provide for an increase in wages and fringe 
benefits at the exercise of each option to extend the term of the 
contract in accordance with the following procedures:
    (1) The Contracting Officer has determined that the portion of the 
contract price or contract unit price(s) containing labor costs subject 
to the Davis-Bacon Act is ------------ [Contracting Officer insert 
percentage rate] percent.
    (2) The Contracting Officer will increase the portion of the 
contract price or contract unit price(s) containing the labor costs 
subject to the Davis-Bacon Act by the percentage rate published in ----
--------[ContractingOfficer insert publication].
    (c) The Contracting Officer will make the price adjustment at the 
exercise of each option to extend the term of the contract. This 
adjustment is the only adjustment that the Contracting Officer will make 
to cover any increases in wages and benefits as a result of--
    (1) Incorporation of the Department of Labor's wage determination 
applicable at the exercise of the option to extend the term of the 
contract;
    (2) Incorporation of a wage determination otherwise applied to the 
contract by operation of law; or
    (3) An increase in wages and benefits resulting from any other 
requirement applicable to workers subject to the Davis-Bacon Act.

                             (End of clause)

[66 FR 53482, Oct. 22, 2001]

[[Page 141]]



Sec.  52.222-32  Davis-Bacon Act--Price Adjustment (Actual Method).

    As prescribed in 22.407(g), insert the following clause:

      Davis-Bacon Act--Price Adjustment (Actual Method) (DEC 2001)

    (a) The wage determination issued under the Davis-Bacon Act by the 
Administrator, Wage and Hour Division, Employment Standards 
Administration, U.S. Department of Labor, that is effective for an 
option to extend the term of the contract, will apply to that option 
period.
    (b)(1) The Contractor states that if the prices in this contract 
contain an allowance for wage or benefit increases, such allowance will 
not be included in any request for contract price adjustment submitted 
under this clause.
    (2) The Contractor shall provide with each request for contract 
price adjustment under this clause a statement that the prices in the 
contract do not include any allowance for any increased cost for which 
adjustment is being requested.
    (c) The Contracting Officer will adjust the contract price or 
contract unit price labor rates to reflect the Contractor's actual 
increase or decrease in wages and fringe benefits to the extent that the 
increase is made to comply with, or the decrease is voluntarily made by 
the Contractor as a result of--
    (1) Incorporation of the Department of Labor's Davis-Bacon Act wage 
determination applicable at the exercise of an option to extend the term 
of the contract; or
    (2) Incorporation of a Davis-Bacon Act wage determination otherwise 
applied to the contract by operation of law.
    (d) Any adjustment will be limited to increases or decreases in 
wages and fringe benefits as described in paragraph (c) of this clause, 
and the accompanying increases or decreases in social security and 
unemployment taxes and workers' compensation insurance, but will not 
otherwise include any amount for general and administrative costs, 
overhead, or profit.
    (e) The Contractor shall notify the Contracting Officer of any 
increase claimed under this clause within 30 days after receiving a 
revised wage determination unless this notification period is extended 
in writing by the Contracting Officer. The Contractor shall notify the 
Contracting Officer promptly of any decrease under this clause, but 
nothing in this clause precludes the Government from asserting a claim 
within the period permitted by law. The notice shall contain a statement 
of the amount claimed and any relevant supporting data, including 
payroll records that the Contracting Officer may reasonably require. 
Upon agreement of the parties, the Contracting Officer will modify the 
contract price or contract unit price in writing. The Contractor shall 
continue performance pending agreement on or determination of any such 
adjustment and its effective date.
    (f) Contract price adjustment computations shall be computed as 
follows:
    (1) Computation for contract unit price per single craft hour for 
schedule of indefinite-quantity work. For each labor classification, the 
difference between the actual wage and benefit rates (combined) paid and 
the wage and benefit rates (combined) required by the new wage 
determination shall be added to the original contract unit price if the 
difference results in a combined increase. If the difference computed 
results in a combined decrease, the contract unit price shall be 
decreased by that amount if the Contractor provides notification as 
provided in paragraph (e) of this clause.
    (2) Computation for contract unit price containing multiple craft 
hours for schedule of indefinite-quantity work. For each labor 
classification, the difference between the actual wage and benefit rates 
(combined) paid and the wage and benefit rates (combined) required by 
the new wage determination shall be multiplied by the actual number of 
hours expended for each craft involved in accomplishing the unit-priced 
work item. The product of this computation will then be divided by the 
actual number of units ordered in the preceding contract period. The 
total of these computations for each craft will be added to the current 
contract unit price to obtain the new contract unit price. The extended 
amount for the contract line item will be obtained by multiplying the 
new unit price by the estimated quantity. If actual hours are not 
available from the preceding contract period for computation of the 
adjustment for a specific contract unit of work, the Contractor, in 
agreement with the Contracting Officer, shall estimate the total hours 
per craft per contract unit of work.

                          Example: Asphalt Paving--Current Price $3.38 per Square Yard
----------------------------------------------------------------------------------------------------------------
                                              Hourly
           DBA craft             New WD        rate        Diff.      Actual hrs.   Actual units       Increase/
                                               paid                                  (sq. yard)         sq. yard
----------------------------------------------------------------------------------------------------------------
Equip. Opr....................   $18.50   -   $18.00   =    $.50   x  600 hrs./    3,000 sq. yrd.   =       $.10
Truck Driver..................   $19.00   -   $18.25   =    $.75   x  525 hrs./    3,000 sq. yrd.   =       $.13
Laborer.......................   $11.50   -   $11.25   =    $.25   x  750 hrs./    3,000 sq. yrd.   =       $.06
                                                                                                      ----------

[[Page 142]]

 
    Total increase per square yard...................................................................     * $.29
* Note: Adjustment for labor rate increases or decreases may be accompanied by social security and unemployment
 taxes and workers' compensation insurance.
Current unit price (per square    $3.38
 yard).
Add DBA price adj.............     +.29
New unit price (per square        $3.67
 yard).
----------------------------------------------------------------------------------------------------------------

                             (End of clause)

[66 FR 53482, Oct. 22, 2001]



Sec.  52.222-33--52.222-34  [Reserved]



Sec.  52.222-35  Equal Opportunity for Special Disabled Veterans, Veterans 
of the Vietnam Era, and Other Eligible Veterans.

    As prescribed in 22.1310(a)(1), insert the following clause:

Equal Opportunity for Special Disabled Veterans, Veterans of the Vietnam 
               Era, and Other Eligible Veterans (DEC 2001)

    (a) Definitions. As used in this clause--
    All employment openings means all positions except executive and top 
management, those positions that will be filled from within the 
Contractor's organization, and positions lasting 3 days or less. This 
term includes full-time employment, temporary employment of more than 3 
days duration, and part-time employment.
    Executive and top management means any employee--
    (1) Whose primary duty consists of the management of the enterprise 
in which the individual is employed or of a customarily recognized 
department or subdivision thereof;
    (2) Who customarily and regularly directs the work of two or more 
other employees;
    (3) Who has the authority to hire or fire other employees or whose 
suggestions and recommendations as to the hiring or firing and as to the 
advancement and promotion or any other change of status of other 
employees will be given particular weight;
    (4) Who customarily and regularly exercises discretionary powers; 
and
    (5) Who does not devote more than 20 percent or, in the case of an 
employee of a retail or service establishment, who does not devote more 
than 40 percent of total hours of work in the work week to activities 
that are not directly and closely related to the performance of the work 
described in paragraphs (1) through (4) of this definition. This 
paragraph (5) does not apply in the case of an employee who is in sole 
charge of an establishment or a physically separated branch 
establishment, or who owns at least a 20 percent interest in the 
enterprise in which the individual is employed.
    Other eligible veteran means any other veteran who served on active 
duty during a war or in a campaign or expedition for which a campaign 
badge has been authorized.
    Positions that will be filled from within the Contractor's 
organization means employment openings for which the Contractor will 
give no consideration to persons outside the Contractor's organization 
(including any affiliates, subsidiaries, and parent companies) and 
includes any openings the Contractor proposes to fill from regularly 
established ``recall'' lists. The exception does not apply to a 
particular opening once an employer decides to consider applicants 
outside of its organization.
    Qualified special disabled veteran means a special disabled veteran 
who satisfies the requisite skill, experience, education, and other job-
related requirements of the employment position such veteran holds or 
desires, and who, with or without reasonable accommodation, can perform 
the essential functions of such position.
    Special disabled veteran means--
    (1) A veteran who is entitled to compensation (or who but for the 
receipt of military retired pay would be entitled to compensation) under 
laws administered by the Department of Veterans Affairs for a 
disability--
    (i) Rated at 30 percent or more; or
    (ii) Rated at 10 or 20 percent in the case of a veteran who has been 
determined under 38 U.S.C. 3106 to have a serious employment handicap 
(i.e., a significant impairment of the veteran's ability to prepare for, 
obtain, or retain employment consistent with the veteran's abilities, 
aptitudes, and interests); or
    (2) A person who was discharged or released from active duty because 
of a service-connected disability.
    Veteran of the Vietnam era means a person who--
    (1) Served on active duty for a period of more than 180 days and was 
discharged or released from active duty with other than a dishonorable 
discharge, if any part of such active duty occurred--

[[Page 143]]

    (i) In the Republic of Vietnam between February 28, 1961, and May 7, 
1975; or
    (ii) Between August 5, 1964, and May 7, 1975, in all other cases; or
    (2) Was discharged or released from active duty for a service-
connected disability if any part of the active duty was performed--
    (i) In the Republic of Vietnam between February 28, 1961, and May 7, 
1975; or
    (ii) Between August 5, 1964, and May 7, 1975, in all other cases.
    (b) General. (1) The Contractor shall not discriminate against the 
individual because the individual is a special disabled veteran, a 
veteran of the Vietnam era, or other eligible veteran, regarding any 
position for which the employee or applicant for employment is 
qualified. The Contractor shall take affirmative action to employ, 
advance in employment, and otherwise treat qualified special disabled 
veterans, veterans of the Vietnam era, and other eligible veterans 
without discrimination based upon their disability or veterans' status 
in all employment practices such as--
    (i) Recruitment, advertising, and job application procedures;
    (ii) Hiring, upgrading, promotion, award of tenure, demotion, 
transfer, layoff, termination, right of return from layoff and rehiring;
    (iii) Rate of pay or any other form of compensation and changes in 
compensation;
    (iv) Job assignments, job classifications, organizational 
structures, position descriptions, lines of progression, and seniority 
lists;
    (v) Leaves of absence, sick leave, or any other leave;
    (vi) Fringe benefits available by virtue of employment, whether or 
not administered by the Contractor;
    (vii) Selection and financial support for training, including 
apprenticeship, and on-the-job training under 38 U.S.C. 3687, 
professional meetings, conferences, and other related activities, and 
selection for leaves of absence to pursue training;
    (viii) Activities sponsored by the Contractor including social or 
recreational programs; and
    (ix) Any other term, condition, or privilege of employment.
    (2) The Contractor shall comply with the rules, regulations, and 
relevant orders of the Secretary of Labor issued under the Vietnam Era 
Veterans' Readjustment Assistance Act of 1972 (the Act), as amended (38 
U.S.C. 4211 and 4212).
    (c) Listing openings. (1) The Contractor shall immediately list all 
employment openings that exist at the time of the execution of this 
contract and those which occur during the performance of this contract, 
including those not generated by this contract, and including those 
occurring at an establishment of the Contractor other than the one where 
the contract is being performed, but excluding those of independently 
operated corporate affiliates, at an appropriate local public employment 
service office of the State wherein the opening occurs. Listing 
employment openings with the U.S. Department of Labor's America's Job 
Bank shall satisfy the requirement to list jobs with the local 
employment service office.
    (2) The Contractor shall make the listing of employment openings 
with the local employment service office at least concurrently with 
using any other recruitment source or effort and shall involve the 
normal obligations of placing a bona fide job order, including accepting 
referrals of veterans and nonveterans. This listing of employment 
openings does not require hiring any particular job applicant or hiring 
from any particular group of job applicants and is not intended to 
relieve the Contractor from any requirements of Executive orders or 
regulations concerning nondiscrimination in employment.
    (3) Whenever the Contractor becomes contractually bound to the 
listing terms of this clause, it shall advise the State public 
employment agency in each State where it has establishments of the name 
and location of each hiring location in the State. As long as the 
Contractor is contractually bound to these terms and has so advised the 
State agency, it need not advise the State agency of subsequent 
contracts. The Contractor may advise the State agency when it is no 
longer bound by this contract clause.
    (d) Applicability. This clause does not apply to the listing of 
employment openings that occur and are filled outside the 50 States, the 
District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth 
of the Northern Mariana Islands, American Samoa, Guam, the Virgin 
Islands of the United States, and Wake Island.
    (e) Postings. (1) The Contractor shall post employment notices in 
conspicuous places that are available to employees and applicants for 
employment.
    (2) The employment notices shall--
    (i) State the rights of applicants and employees as well as the 
Contractor's obligation under the law to take affirmative action to 
employ and advance in employment qualified employees and applicants who 
are special disabled veterans, veterans of the Vietnam era, and other 
eligible veterans; and
    (ii) Be in a form prescribed by the Deputy Assistant Secretary for 
Federal Contract Compliance Programs, Department of Labor (Deputy 
Assistant Secretary of Labor), and provided by or through the 
Contracting Officer.
    (3) The Contractor shall ensure that applicants or employees who are 
special disabled veterans are informed of the contents of the notice 
(e.g., the Contractor may have the notice read to a visually disabled 
veteran, or

[[Page 144]]

may lower the posted notice so that it can be read by a person in a 
wheelchair).
    (4) The Contractor shall notify each labor union or representative 
of workers with which it has a collective bargaining agreement, or other 
contract understanding, that the Contractor is bound by the terms of the 
Act and is committed to take affirmative action to employ, and advance 
in employment, qualified special disabled veterans, veterans of the 
Vietnam era, and other eligible veterans.
    (f) Noncompliance. If the Contractor does not comply with the 
requirements of this clause, the Government may take appropriate actions 
under the rules, regulations, and relevant orders of the Secretary of 
Labor issued pursuant to the Act.
    (g) Subcontracts. The Contractor shall insert the terms of this 
clause in all subcontracts or purchase orders of $25,000 or more unless 
exempted by rules, regulations, or orders of the Secretary of Labor. The 
Contractor shall act as specified by the Deputy Assistant Secretary of 
Labor to enforce the terms, including action for noncompliance.

                             (End of clause)

    Alternate I (Dec 2001). As prescribed in 22.1310(a)(2), add the 
following as a preamble to the clause:
    Notice: The following term(s) of this clause are waived for this 
contract:----------------[List term(s)].

[66 FR 53490, Oct. 22, 2001]



Sec.  52.222-36  Affirmative Action for Workers With Disabilities.

    As prescribed in 22.1408(a), insert the following clause:

       Affirmative Action for Workers With Disabilities (JUN 1998)

    (a) General. (1) Regarding any position for which the employee or 
applicant for employment is qualified, the Contractor shall not 
discriminate against any employee or applicant because of physical or 
mental disability. The Contractor agrees to take affirmative action to 
employ, advance in employment, and otherwise treat qualified individuals 
with disabilities without discrimination based upon their physical or 
mental disability in all employment practices such as--
    (i) Recruitment, advertising, and job application procedures;
    (ii) Hiring, upgrading, promotion, award of tenure, demotion, 
transfer, layoff, termination, right of return from layoff, and 
rehiring;
    (iii) Rates of pay or any other form of compensation and changes in 
compensation;
    (iv) Job assignments, job classifications, organizational 
structures, position descriptions, lines of progression, and seniority 
lists;
    (v) Leaves of absence, sick leave, or any other leave;
    (vi) Fringe benefits available by virtue of employment, whether or 
not administered by the Contractor;
    (vii) Selection and financial support for training, including 
apprenticeships, professional meetings, conferences, and other related 
activities, and selection for leaves of absence to pursue training;
    (viii) Activities sponsored by the Contractor, including social or 
recreational programs; and
    (ix) Any other term, condition, or privilege of employment.
    (2) The Contractor agrees to comply with the rules, regulations, and 
relevant orders of the Secretary of Labor (Secretary) issued under the 
Rehabilitation Act of 1973 (29 U.S.C. 793) (the Act), as amended.
    (b) Postings. (1) The Contractor agrees to post employment notices 
stating--
    (i) The Contractor's obligation under the law to take affirmative 
action to employ and advance in employment qualified individuals with 
disabilities; and
    (ii) The rights of applicants and employees.
    (2) These notices shall be posted in conspicuous places that are 
available to employees and applicants for employment. The Contractor 
shall ensure that applicants and employees with disabilities are 
informed of the contents of the notice (e.g., the Contractor may have 
the notice read to a visually disabled individual, or may lower the 
posted notice so that it might be read by a person in a wheelchair). The 
notices shall be in a form prescribed by the Deputy Assistant Secretary 
for Federal Contract Compliance of the U.S. Department of Labor (Deputy 
Assistant Secretary) and shall be provided by or through the Contracting 
Officer.
    (3) The Contractor shall notify each labor union or representative 
of workers with which it has a collective bargaining agreement or other 
contract understanding, that the Contractor is bound by the terms of 
Section 503 of the Act and is committed to take affirmative action to 
employ, and advance in employment, qualified individuals with physical 
or mental disabilities.
    (c) Noncompliance. If the Contractor does not comply with the 
requirements of this clause, appropriate actions may be taken under the 
rules, regulations, and relevant orders of the Secretary issued pursuant 
to the Act.
    (d) Subcontracts. The Contractor shall include the terms of this 
clause in every subcontract or purchase order in excess of $10,000 
unless exempted by rules, regulations, or orders of the Secretary. The 
Contractor shall act as specified by the Deputy Assistant Secretary to 
enforce the terms, including action for noncompliance.

[[Page 145]]

                             (End of clause)

    Alternate I (Jun 1998). As prescribed in 22.1408(b), add the 
following as a preamble to the clause:

    Notice: The following term(s) of this clause are waived for this 
contract:

________________________________________________________________________

[List term(s)].

[63 FR 34075, June 22, 1998]



Sec.  52.222-37  Employment Reports on Special Disabled Veterans, Veterans 
of the Vietnam Era, and Other Eligible Veterans.

    As prescribed in 22.1310(b), insert the following clause:

Employment Reports on Special Disabled Veterans, Veterans of the Vietnam 
               Era, and Other Eligible Veterans (DEC 2001)

    (a) Unless the Contractor is a State or local government agency, the 
Contractor shall report at least annually, as required by the Secretary 
of Labor, on--
    (1) The number of special disabled veterans, the number of veterans 
of the Vietnam era, and other eligible veterans in the workforce of the 
Contractor by job category and hiring location; and
    (2) The total number of new employees hired during the period 
covered by the report, and of the total, the number of special disabled 
veterans, the number of veterans of the Vietnam era, and the number of 
other eligible veterans; and
    (3) The maximum number and the minimum number of employees of the 
Contractor during the period covered by the report.
    (b) The Contractor shall report the above items by completing the 
Form VETS-100, entitled ``Federal Contractor Veterans'' Employment 
Report (VETS-100 Report)''.
    (c) The Contractor shall submit VETS-100 Reports no later than 
September 30 of each year beginning September 30, 1988.
    (d) The employment activity report required by paragraph (a)(2) of 
this clause shall reflect total hires during the most recent 12-month 
period as of the ending date selected for the employment profile report 
required by paragraph (a)(1) of this clause. Contractors may select an 
ending date--
    (1) As of the end of any pay period between July 1 and August 31 of 
the year the report is due; or
    (2) As of December 31, if the Contractor has prior written approval 
from the Equal Employment Opportunity Commission to do so for purposes 
of submitting the Employer Information Report EEO-1 (Standard Form 100).
    (e) The Contractor shall base the count of veterans reported 
according to paragraph (a) of this clause on voluntary disclosure. Each 
Contractor subject to the reporting requirements at 38 U.S.C. 4212 shall 
invite all special disabled veterans, veterans of the Vietnam era, and 
other eligible veterans who wish to benefit under the affirmative action 
program at 38 U.S.C. 4212 to identify themselves to the Contractor. The 
invitation shall state that--
    (1) The information is voluntarily provided;
    (2) The information will be kept confidential;
    (3) Disclosure or refusal to provide the information will not 
subject the applicant or employee to any adverse treatment; and
    (4) The information will be used only in accordance with the 
regulations promulgated under 38 U.S.C. 4212.
    (f) The Contractor shall insert the terms of this clause in all 
subcontracts or purchase orders of $25,000 or more unless exempted by 
rules, regulations, or orders of the Secretary of Labor.

                             (End of clause)

[66 FR 53491, Oct. 22, 2001]



Sec.  52.222-38  Compliance with Veterans' Employment Reporting Requirements.

    As prescribed in 22.1310(c), insert the following provision:

 Compliance With Veterans' Employment Reporting Requirements (DEC 2001)

    By submission of its offer, the offeror represents that, if it is 
subject to the reporting requirements of 38 U.S.C. 4212(d) (i.e., if it 
has any contract containing Federal Acquisition Regulation clause 
52.222-37, Employment Reports on Special Disabled Veterans, Veterans of 
the Vietnam Era, and Other Eligible Veterans), it has submitted the most 
recent VETS-100 Report required by that clause.

                           (End of provision)

[66 FR 53491, Oct. 22, 2001]



Sec.  52.222-39--52.222-40  [Reserved]



Sec.  52.222-41  Service Contract Act of 1965, as Amended.

    As prescribed in 22.1006(a), insert the following clause:

[[Page 146]]

           Service Contract Act of 1965, as Amended (MAY 1989)

    (a) Definitions. Act, as used in this clause, means the Service 
Contract Act of 1965, as amended (41 U.S.C. 351, et seq.).
    Contractor, as used in this clause or in any subcontract, shall be 
deemed to refer to the subcontractor, except in the term Government 
Prime Contractor.
    Service employee, as used in this clause, means any person engaged 
in the performance of this contract other than any person employed in a 
bona fide executive, administrative, or professional capacity, as these 
terms are defined in part 541 of title 29, Code of Federal Regulations, 
as revised. It includes all such persons regardless of any contractual 
relationship that may be alleged to exist between a Contractor or 
subcontractor and such persons.
    (b) Applicability. This contract is subject to the following 
provisions and to all other applicable provisions of the Act and 
regulations of the Secretary of Labor (29 CFR part 4). This clause does 
not apply to contracts or subcontracts administratively exempted by the 
Secretary of Labor or exempted by 41 U.S.C. 356, as interpreted in 
subpart C of 29 CFR part 4.
    (c) Compensation. (1) Each service employee employed in the 
performance of this contract by the Contractor or any subcontractor 
shall be paid not less than the minimum monetary wages and shall be 
furnished fringe benefits in accordance with the wages and fringe 
benefits determined by the Secretary of Labor, or authorized 
representative, as specified in any wage determination attached to this 
contract.
    (2)(i) If a wage determination is attached to this contract, the 
Contractor shall classify any class of service employee which is not 
listed therein and which is to be employed under the contract (i.e., the 
work to be performed is not performed by any classification listed in 
the wage determination) so as to provide a reasonable relationship 
(i.e., appropriate level of skill comparison) between such unlisted 
classifications and the classifications listed in the wage 
determination. Such conformed class of employees shall be paid the 
monetary wages and furnished the fringe benefits as are determined 
pursuant to the procedures in this paragraph (c).
    (ii) This conforming procedure shall be initiated by the Contractor 
prior to the performance of contract work by the unlisted class of 
employee. The Contractor shall submit Standard Form (SF) 1444, Request 
for Authorization of Additional Classification and Rate, to the 
Contracting Officer no later than 30 days after the unlisted class of 
employee performs any contract work. The Contracting Officer shall 
review the proposed classification and rate and promptly submit the 
completed SF 1444 (which must include information regarding the 
agreement or disagreement of the employees' authorized representatives 
or the employees themselves together with the agency recommendation), 
and all pertinent information to the Wage and Hour Division, Employment 
Standards Administration U.S. Department of Labor. The Wage and Hour 
Division will approve, modify, or disapprove the action or render a 
final determination in the event of disagreement within 30 days of 
receipt or will notify the Contracting Officer within 30 days of receipt 
that additional time is necessary.
    (iii) The final determination of the conformance action by the Wage 
and Hour Division shall be transmitted to the Contracting Officer who 
shall promptly notify the Contractor of the action taken. Each affected 
employee shall be furnished by the Contractor with a written copy of 
such determination or it shall be posted as a part of the wage 
determination.
    (iv)(A) The process of establishing wage and fringe benefit rates 
that bear a reasonable relationship to those listed in a wage 
determination cannot be reduced to any single formula. The approach used 
may vary from wage determination to wage determination depending on the 
circumstances. Standard wage and salary administration practices which 
rank various job classifications by pay grade pursuant to point schemes 
or other job factors may, for example, be relied upon. Guidance may also 
be obtained from the way different jobs are rated under Federal pay 
systems (Federal Wage Board Pay System and the General Schedule) or from 
other wage determinations issued in the same locality. Basic to the 
establishment of any conformable wage rate(s) is the concept that a pay 
relationship should be maintained between job classifications based on 
the skill required and the duties performed.
    (B) In the case of a contract modification, an exercise of an 
option, or extension of an existing contract, or in any other case where 
a Contractor succeeds a contract under which the classification in 
question was previously conformed pursuant to paragraph (c) of this 
clause, a new conformed wage rate and fringe benefits may be assigned to 
the conformed classification by indexing (i.e., adjusting) the previous 
conformed rate and fringe benefits by an amount equal to the average 
(mean) percentage increase (or decrease, where appropriate) between the 
wages and fringe benefits specified for all classifications to be used 
on the contract which are listed in the current wage determination, and 
those specified for the corresponding classifications in the previously 
applicable wage determination. Where conforming actions are accomplished 
in accordance with this paragraph prior to the performance of contract 
work by the unlisted

[[Page 147]]

class of employees, the Contractor shall advise the Contracting Officer 
of the action taken but the other procedures in subdivision (c)(2)(ii) 
of this clause need not be followed.
    (C) No employee engaged in performing work on this contract shall in 
any event be paid less than the currently applicable minimum wage 
specified under section 6(a)(1) of the Fair Labor Standards Act of 1938, 
as amended.
    (v) The wage rate and fringe benefits finally determined under this 
subparagraph (c)(2) of this clause shall be paid to all employees 
performing in the classification from the first day on which contract 
work is performed by them in the classification. Failure to pay the 
unlisted employees the compensation agreed upon by the interested 
parties and/or finally determined by the Wage and Hour Division 
retroactive to the date such class of employees commenced contract work 
shall be a violation of the Act and this contract.
    (vi) Upon discovery of failure to comply with subparagraph (c)(2) of 
this clause, the Wage and Hour Division shall make a final determination 
of conformed classification, wage rate, and/or fringe benefits which 
shall be retroactive to the date such class or classes of employees 
commenced contract work.
    (3) Adjustment of Compensation. If the term of this contract is more 
than 1 year, the minimum monetary wages and fringe benefits required to 
be paid or furnished thereunder to service employees under this contract 
shall be subject to adjustment after 1 year and not less often than once 
every 2 years, under wage determinations issued by the Wage and Hour 
Division.
    (d) Obligation to Furnish Fringe Benefits. The Contractor or 
subcontractor may discharge the obligation to furnish fringe benefits 
specified in the attachment or determined under subparagraph (c)(2) of 
this clause by furnishing equivalent combinations of bona fide fringe 
benefits, or by making equivalent or differential cash payments, only in 
accordance with subpart D of 29 CFR part 4.
    (e) Minimum Wage. In the absence of a minimum wage attachment for 
this contract, neither the Contractor nor any subcontractor under this 
contract shall pay any person performing work under this contract 
(regardless of whether the person is a service employee) less than the 
minimum wage specified by section 6(a)(1) of the Fair Labor Standards 
Act of 1938. Nothing in this clause shall relieve the Contractor or any 
subcontractor of any other obligation under law or contract for payment 
of a higher wage to any employee.
    (f) Successor Contracts. If this contract succeeds a contract 
subject to the Act under which substantially the same services were 
furnished in the same locality and service employees were paid wages and 
fringe benefits provided for in a collective bargaining agreement, in 
the absence of the minimum wage attachment for this contract setting 
forth such collectively bargained wage rates and fringe benefits, 
neither the Contractor nor any subcontractor under this contract shall 
pay any service employee performing any of the contract work (regardless 
of whether or not such employee was employed under the predecessor 
contract), less than the wages and fringe benefits provided for in such 
collective bargaining agreement, to which such employee would have been 
entitled if employed under the predecessor contract, including accrued 
wages and fringe benefits and any prospective increases in wages and 
fringe benefits provided for under such agreement. No Contractor or 
subcontractor under this contract may be relieved of the foregoing 
obligation unless the limitations of 29 CFR 4.1b(b) apply or unless the 
Secretary of Labor or the Secretary's authorized representative finds, 
after a hearing as provided in 29 CFR 4.10 that the wages and/or fringe 
benefits provided for in such agreement are substantially at variance 
with those which prevail for services of a character similar in the 
locality, or determines, as provided in 29 CFR 4.11, that the collective 
bargaining agreement applicable to service employees employed under the 
predecessor contract was not entered into as a result of arm's length 
negotiations. Where it is found in accordance with the review procedures 
provided in 29 CFR 4.10 and/or 4.11 and parts 6 and 8 that some or all 
of the wages and/or fringe benefits contained in a predecessor 
Contractor's collective bargaining agreement are substantially at 
variance with those which prevail for services of a character similar in 
the locality, and/or that the collective bargaining agreement applicable 
to service employees employed under the predecessor contract was not 
entered into as a result of arm's length negotiations, the Department 
will issue a new or revised wage determination setting forth the 
applicable wage rates and fringe benefits. Such determination shall be 
made part of the contract or subcontract, in accordance with the 
decision of the Administrator, the Administrative Law Judge, or the 
Board of Service Contract Appeals, as the case may be, irrespective of 
whether such issuance occurs prior to or after the award of a contract 
or subcontract (53 Comp. Gen. 401 (1973)). In the case of a wage 
determination issued solely as a result of a finding of substantial 
variance, such determination shall be effective as of the date of the 
final administrative decision.
    (g) Notification to Employees. The Contractor and any subcontractor 
under this contract shall notify each service employee commencing work 
on this contract of the minimum monetary wage and any fringe benefits 
required to be paid pursuant to this

[[Page 148]]

contract, or shall post the wage determination attached to this 
contract. The poster provided by the Department of Labor (Publication WH 
1313) shall be posted in a prominent and accessible place at the 
worksite. Failure to comply with this requirement is a violation of 
section 2(a)(4) of the Act and of this contract.
    (h) Safe and Sanitary Working Conditions. The Contractor or 
subcontractor shall not permit any part of the services called for by 
this contract to be performed in buildings or surroundings or under 
working conditions provided by or under the control or supervision of 
the Contractor or subcontractor which are unsanitary, hazardous, or 
dangerous to the health or safety of the service employees. The 
Contractor or subcontractor shall comply with the safety and health 
standards applied under 29 CFR part 1925.
    (i) Records. (1) The Contractor and each subcontractor performing 
work subject to the Act shall make and maintain for 3 years from the 
completion of the work, and make them available for inspection and 
transcription by authorized representatives of the Wage and Hour 
Division, Employment Standards Administration, a record of the 
following:
    (i) For each employee subject to the Act--
    (A) Name and address and social security number;
    (B) Correct work classification or classifications, rate or rates of 
monetary wages paid and fringe benefits provided, rate or rates of 
payments in lieu of fringe benefits, and total daily and weekly 
compensation;
    (C) Daily and weekly hours worked by each employee; and
    (D) Any deductions, rebates, or refunds from the total daily or 
weekly compensation of each employee.
    (ii) For those classes of service employees not included in any wage 
determination attached to this contract, wage rates or fringe benefits 
determined by the interested parties or by the Administrator or 
authorized representative under the terms of paragraph (c) of this 
clause. A copy of the report required by subdivision (c)(2)(ii) of this 
clause will fulfill this requirement.
    (iii) Any list of the predecessor Contractor's employees which had 
been furnished to the Contractor as prescribed by paragraph (n) of this 
clause.
    (2) The Contractor shall also make available a copy of this contract 
for inspection or transcription by authorized representatives of the 
Wage and Hour Division.
    (3) Failure to make and maintain or to make available these records 
for inspection and transcription shall be a violation of the regulations 
and this contract, and in the case of failure to produce these records, 
the Contracting Officer, upon direction of the Department of Labor and 
notification to the Contractor, shall take action to cause suspension of 
any further payment or advance of funds until the violation ceases.
    (4) The Contractor shall permit authorized representatives of the 
Wage and Hour Division to conduct interviews with employees at the 
worksite during normal working hours.
    (j) Pay Periods. The Contractor shall unconditionally pay to each 
employee subject to the Act all wages due free and clear and without 
subsequent deduction (except as otherwise provided by law or 
Regulations, 29 CFR part 4), rebate, or kickback on any account. These 
payments shall be made no later than one pay period following the end of 
the regular pay period in which the wages were earned or accrued. A pay 
period under this Act may not be of any duration longer than semi-
monthly.
    (k) Withholding of Payments and Termination of Contract. The 
Contracting Officer shall withhold or cause to be withheld from the 
Government Prime Contractor under this or any other Government contract 
with the Prime Contractor such sums as an appropriate official of the 
Department of Labor requests or such sums as the Contracting Officer 
decides may be necessary to pay underpaid employees employed by the 
Contractor or subcontractor. In the event of failure to pay any 
employees subject to the Act all or part of the wages or fringe benefits 
due under the Act, the Contracting Officer may, after authorization or 
by direction of the Department of Labor and written notification to the 
Contractor, take action to cause suspension of any further payment or 
advance of funds until such violations have ceased. Additionally, any 
failure to comply with the requirements of this clause may be grounds 
for termination of the right to proceed with the contract work. In such 
event, the Government may enter into other contracts or arrangements for 
completion of the work, charging the Contractor in default with any 
additional cost.
    (l) Subcontracts. The Contractor agrees to insert this clause in all 
subcontracts subject to the Act.
    (m) Collective Bargaining Agreements Applicable to Service 
Employees. If wages to be paid or fringe benefits to be furnished any 
service employees employed by the Government Prime Contractor or any 
subcontractor under the contract are provided for in a collective 
bargaining agreement which is or will be effective during any period in 
which the contract is being performed, the Government Prime Contractor 
shall report such fact to the Contracting Officer, together with full 
information as to the application and accrual of such wages and fringe 
benefits, including any prospective increases, to service employees 
engaged in work on the contract, and a copy of the collective bargaining 
agreement. Such report shall be made upon commencing performance of the 
contract, in the case of collective bargaining

[[Page 149]]

agreements effective at such time, and in the case of such agreements or 
provisions or amendments thereof effective at a later time during the 
period of contract performance such agreements shall be reported 
promptly after negotiation thereof.
    (n) Seniority List. Not less than 10 days prior to completion of any 
contract being performed at a Federal facility where service employees 
may be retained in the performance of the succeeding contract and 
subject to a wage determination which contains vacation or other benefit 
provisions based upon length of service with a Contractor (predecessor) 
or successor (29 CFR 4.173), the incumbent Prime Contractor shall 
furnish the Contracting Officer a certified list of the names, of all 
service employees on the Contractor's or subcontractor's payroll during 
the last month of contract performance. Such list shall also contain 
anniversary dates of employment on the contract either with the current 
or predecessor Contractors of each such service employee. The 
Contracting Officer shall turn over such list to the successor 
Contractor at the commencement of the succeeding contract.
    (o) Rulings and Interpretations. Rulings and interpretations of the 
Act are contained in Regulations, 29 CFR part 4.
    (p) Contractor's Certification. (1) By entering into this contract, 
the Contractor (and officials thereof) certifies that neither it (nor he 
or she) nor any person or firm who has a substantial interest in the 
Contractor's firm is a person or firm ineligible to be awarded 
Government contracts by virtue of the sanctions imposed under section 5 
of the Act.
    (2) No part of this contract shall be subcontracted to any person or 
firm ineligible for award of a Government contract under section 5 of 
the Act.
    (3) The penalty for making false statements is prescribed in the 
U.S. Criminal Code, 18 U.S.C. 1001.
    (q) Variations, Tolerances, and Exemptions Involving Employment. 
Notwithstanding any of the provisions in paragraphs (b) through (o) of 
this clause, the following employees may be employed in accordance with 
the following variations, tolerances, and exemptions, which the 
Secretary of Labor, pursuant to section 4(b) of the Act prior to its 
amendment by Pub. L. 92-473, found to be necessary and proper in the 
public interest or to avoid serious impairment of the conduct of 
Government business.
    (1) Apprentices, student-learners, and workers whose earning 
capacity is impaired by age, physical or mental deficiency or injury may 
be employed at wages lower than the minimum wages otherwise required by 
section 2(a)(1) or 2(b)(1) of the Act without diminishing any fringe 
benefits or cash payments in lieu thereof required under section 2(a)(2) 
of the Act, in accordance with the conditions and procedures prescribed 
for the employment of apprentices, student-learners, handicapped 
persons, and handicapped clients of sheltered workshops under section 14 
of the Fair Labor Standards Act of 1938, in the regulations issued by 
the Administrator (29 CFR parts 520, 521, 524, and 525).
    (2) The Administrator will issue certificates under the Act for the 
employment of apprentices, student-learners, handicapped persons, or 
handicapped clients of sheltered workshops not subject to the Fair Labor 
Standards Act of 1938, or subject to different minimum rates of pay 
under the two acts, authorizing appropriate rates of minimum wages (but 
without changing requirements concerning fringe benefits or 
supplementary cash payments in lieu thereof), applying procedures 
prescribed by the applicable regulations issued under the Fair Labor 
Standards Act of 1938 (29 CFR parts 520, 521, 524, and 525).
    (3) The Administrator will also withdraw, annul, or cancel such 
certificates in accordance with the regulations in 29 CFR parts 525 and 
528.
    (r) Apprentices. Apprentices will be permitted to work at less than 
the predetermined rate for the work they perform when they are employed 
and individually registered in a bona fide apprenticeship program 
registered with a State Apprenticeship Agency which is recognized by the 
U.S. Department of Labor, or if no such recognized agency exists in a 
State, under a program registered with the Bureau of Apprenticeship and 
Training, Employment and Training Administration, U.S. Department of 
Labor. Any employee who is not registered as an apprentice in an 
approved program shall be paid the wage rate and fringe benefits 
contained in the applicable wage determination for the journeyman 
classification of work actually performed. The wage rates paid 
apprentices shall not be less than the wage rate for their level of 
progress set forth in the registered program, expressed as the 
appropriate percentage of the journeyman's rate contained in the 
applicable wage determination. The allowable ratio of apprentices to 
journeymen employed on the contract work in any craft classification 
shall not be greater than the ratio permitted to the Contractor as to 
his entire work force under the registered program.
    (s) Tips. An employee engaged in an occupation in which the employee 
customarily and regularly receives more than $30 a month in tips may 
have the amount of these tips credited by the employer against the 
minimum wage required by section 2(a)(1) or section 2(b)(1) of the Act, 
in accordance with section 3(m) of the Fair Labor Standards Act and 
Regulations 29 CFR part 531. However, the amount of credit shall not 
exceed $1.34 per hour beginning January l, 1981. To use this provision--

[[Page 150]]

    (1) The employer must inform tipped employees about this tip credit 
allowance before the credit is utilized;
    (2) The employees must be allowed to retain all tips (individually 
or through a pooling arrangement and regardless of whether the employer 
elects to take a credit for tips received);
    (3) The employer must be able to show by records that the employee 
receives at least the applicable Service Contract Act minimum wage 
through the combination of direct wages and tip credit; and
    (4) The use of such tip credit must have been permitted under any 
predecessor collective bargaining agreement applicable by virtue of 
section 4(c) of the Act.
    (t) Disputes Concerning Labor Standards. The U.S. Department of 
Labor has set forth in 29 CFR parts 4, 6, and 8 procedures for resolving 
disputes concerning labor standards requirements. Such disputes shall be 
resolved in accordance with those procedures and not the Disputes clause 
of this contract. Disputes within the meaning of this clause include 
disputes between the Contractor (or any of its subcontractors) and the 
contracting agency, the U.S. Department of Labor, or the employees or 
their representatives.

                             (End of clause)

[54 FR 19828, May 8, 1989]



Sec.  52.222-42  Statement of Equivalent Rates for Federal Hires.

    As prescribed in 22.1006(b), insert the following clause:

       Statement of Equivalent Rates for Federal Hires (MAY 1989)

    In compliance with the Service Contract Act of 1965, as amended, and 
the regulations of the Secretary of Labor (29 CFR part 4), this clause 
identifies the classes of service employees expected to be employed 
under the contract and states the wages and fringe benefits payable to 
each if they were employed by the contracting agency subject to the 
provisions of 5 U.S.C. 5341 or 5332.

 This Statement is for Information Only: It Is Not a Wage Determination

 
                                                  Monetary wage--Fringe
                 Employee class                          benefits
 
                                                 .......................
                                                 .......................
                                                 .......................
                                                 .......................
                                                 .......................
                                                 .......................
 

                             (End of clause)

[54 FR 19831, May 8, 1989]



Sec.  52.222-43  Fair Labor Standards Act and Service Contract Act--Price 
Adjustment (Multiple Year and Option Contracts).

    As prescribed in 22.1006(c)(1), insert the following clause:

  Fair Labor Standards Act and Service Contract Act--Price Adjustment 
             (Multiple Year and Option Contracts) (MAY 1989)

    (a) This clause applies to both contracts subject to area prevailing 
wage determinations and contracts subject to collective bargaining 
agreements.
    (b) The Contractor warrants that the prices in this contract do not 
include any allowance for any contingency to cover increased costs for 
which adjustment is provided under this clause.
    (c) The wage determination, issued under the Service Contract Act of 
1965, as amended, (41 U.S.C. 351, et seq.), by the Administrator, Wage 
and Hour Division, Employment Standards Administration, U.S. Department 
of Labor, current on the anniversary date of a multiple year contract or 
the beginning of each renewal option period, shall apply to this 
contract. If no such determination has been made applicable to this 
contract, then the Federal minimum wage as established by section 
6(a)(1) of the Fair Labor Standards Act of 1938, as amended, (29 U.S.C. 
206) current on the anniversary date of a multiple year contract or the 
beginning of each renewal option period, shall apply to this contract.
    (d) The contract price or contract unit price labor rates will be 
adjusted to reflect the Contractor's actual increase or decrease in 
applicable wages and fringe benefits to the extent that the increase is 
made to comply with or the decrease is voluntarily made by the 
Contractor as a result of:
    (1) The Department of Labor wage determination applicable on the 
anniversary date of the multiple year contract, or at the beginning of 
the renewal option period. For example, the prior year wage 
determination required a minimum wage rate of $4.00 per hour. The 
Contractor chose to pay $4.10. The new wage determination increases the 
minimum rate to $4.50 per hour. Even if the Contractor voluntarily 
increases the rate to $4.75 per hour, the allowable price adjustment is 
$.40 per hour;
    (2) An increased or decreased wage determination otherwise applied 
to the contract by operation of law; or
    (3) An amendment to the Fair Labor Standards Act of l938 that is 
enacted after award of this contract, affects the minimum

[[Page 151]]

wage, and becomes applicable to this contract under law.
    (e) Any adjustment will be limited to increases or decreases in 
wages and fringe benefits as described in paragraph (c) of this clause, 
and the accompanying increases or decreases in social security and 
unemployment taxes and workers' compensation insurance, but shall not 
otherwise include any amount for general and administrative costs, 
overhead, or profit.
    (f) The Contractor shall notify the Contracting Officer of any 
increase claimed under this clause within 30 days after receiving a new 
wage determination unless this notification period is extended in 
writing by the Contracting Officer. The Contractor shall promptly notify 
the Contracting Officer of any decrease under this clause, but nothing 
in the clause shall preclude the Government from asserting a claim 
within the period permitted by law. The notice shall contain a statement 
of the amount claimed and any relevant supporting data, including 
payroll records, that the Contracting Officer may reasonably require. 
Upon agreement of the parties, the contract price or contract unit price 
labor rates shall be modified in writing. The Contractor shall continue 
performance pending agreement on or determination of any such adjustment 
and its effective date.
    (g) The Contracting Officer or an authorized representative shall 
have access to and the right to examine any directly pertinent books, 
documents, papers and records of the Contractor until the expiration of 
3 years after final payment under the contract.

                             (End of clause)

[54 FR 19831, May 8, 1989]



Sec.  52.222-44  Fair Labor Standards Act and Service Contract Act--Price Adjustment.

    As prescribed in 22.1006(c)(2), insert the following clause:

Fair Labor Standards Act and Service Contract Act--Price Adjustment (FEB 
                                  2002)

    (a) This clause applies to both contracts subject to area prevailing 
wage determinations and contracts subject to Contractor collective 
bargaining agreements.
    (b) The Contractor warrants that the prices in this contract do not 
include any allowance for any contingency to cover increased costs for 
which adjustment is provided under this clause.
    (c) The contract price or contract unit price labor rates will be 
adjusted to reflect increases or decreases by the Contractor in wages 
and fringe benefits to the extent that these increases or decreases are 
made to comply with--
    (1) An increased or decreased wage determination applied to this 
contract by operation of law; or
    (2) An amendment to the Fair Labor Standards Act of 1938 that is 
enacted subsequent to award of this contract, affects the minimum wage, 
and becomes applicable to this contract under law.
    (d) Any such adjustment will be limited to increases or decreases in 
wages and fringe benefits as described in paragraph (c) of this clause, 
and to the accompanying increases or decreases in social security and 
unemployment taxes and workers' compensation insurance; it shall not 
otherwise include any amount for general and administrative costs, 
overhead, or profit.
    (e) The Contractor shall notify the Contracting Officer of any 
increase claimed under this clause within 30 days after the effective 
date of the wage change, unless this period is extended by the 
Contracting Officer in writing. The Contractor shall promptly notify the 
Contracting Officer of any decrease under this clause, but nothing in 
the clause shall preclude the Government from asserting a claim within 
the period permitted by law. The notice shall contain a statement of the 
amount claimed and any relevant supporting data that the Contracting 
Officer may reasonably require. Upon agreement of the parties, the 
contract price or contract unit price labor rates shall be modified in 
writing. The Contractor shall continue performance pending agreement on 
or determination of any such adjustment and its effective date.
    (f) The Contracting Officer or an authorized representative shall, 
until the expiration of 3 years after final payment under the contract, 
have access to and the right to examine any directly pertinent books, 
documents, papers, and records of the Contractor.

                             (End of clause)

[54 FR 19831, May 8, 1989, as amended at 67 FR 6121, Feb. 8, 2002]



Sec.  52.222-45  [Reserved]



Sec.  52.222-46  Evaluation of Compensation for Professional Employees.

    As prescribed in 22.1103, insert the following provision:

    Evaluation of Compensation for Professional Employees (FEB 1993)

    (a) Recompetition of service contracts may in some cases result in 
lowering the compensation (salaries and fringe benefits) paid or 
furnished professional employees. This lowering can be detrimental in 
obtaining the quality of professional services needed for

[[Page 152]]

adequate contract performance. It is therefore in the Government's best 
interest that professional employees, as defined in 29 CFR 541, be 
properly and fairly compensated. As a part of their proposals, offerors 
will submit a total compensation plan setting forth salaries and fringe 
benefits proposed for the professional employees who will work under the 
contract. The Government will evaluate the plan to assure that it 
reflects a sound management approach and understanding of the contract 
requirements. This evaluation will include an assessment of the 
offeror's ability to provide uninterrupted high-quality work. The 
professional compensation proposed will be considered in terms of its 
impact upon recruiting and retention, its realism, and its consistency 
with a total plan for compensation. Supporting information will include 
data, such as recognized national and regional compensation surveys and 
studies of professional, public and private organizations, used in 
establishing the total compensation structure.
    (b) The compensation levels proposed should reflect a clear 
understanding of work to be performed and should indicate the capability 
of the proposed compensation structure to obtain and keep suitably 
qualified personnel to meet mission objectives. The salary rates or 
ranges must take into account differences in skills, the complexity of 
various disciplines, and professional job difficulty. Additionally, 
proposals envisioning compensation levels lower than those of 
predecessor contractors for the same work will be evaluated on the basis 
of maintaining program continuity, uninterrupted high-quality work, and 
availability of required competent professional service employees. 
Offerors are cautioned that lowered compensation for essentially the 
same professional work may indicate lack of sound management judgment 
and lack of understanding of the requirement.
    (c) The Government is concerned with the quality and stability of 
the work force to be employed on this contract. Professional 
compensation that is unrealistically low or not in reasonable 
relationship to the various job categories, since it may impair the 
Contractor's ability to attract and retain competent professional 
service employees, may be viewed as evidence of failure to comprehend 
the complexity of the contract requirements.
    (d) Failure to comply with these provisions may constitute 
sufficient cause to justify rejection of a proposal.

                           (End of provision)

[48 FR 42478, Sept. 19, 1983, as amended at 57 FR 60582, Dec. 21, 1992]




Sec.  52.222-47  SCA Minimum Wages and Fringe Benefits Applicable to 
Successor Contract Pursuant to Predecessor Contractor Collective 
Bargaining Agreements 
          (CBA).

    As prescribed in 22.1006(d) and 22.1012-3(d)(1), insert the 
following clause:

 Service Contract Act (SCA) Minimum Wages and Fringe Benefits (MAY 1989)

    An SCA wage determination applicable to this work has been requested 
from the U.S. Department of Labor. If an SCA wage determination is not 
incorporated herein, the bidders/offerors shall consider the economic 
terms of the collective bargaining agreement (CBA) between the incumbent 
Contractor ------------ and the ------------ (union). If the economic 
terms of the collective bargaining agreement or the collective 
bargaining agreement itself is not attached to the solicitation, copies 
can be obtained from the Contracting Officer. Pursuant to Department of 
Labor Regulation, 29 CFR 4.1b and paragraph (g) of the clause at 52.222-
41, Service Contract Act of 1965, as amended, the economic terms of that 
agreement will apply to the contract resulting from this solicitation, 
notwithstanding the absence of a wage determination reflecting such 
terms, unless it is determined that the agreement was not the result of 
arm's length negotiations or that after a hearing pursuant to section 
4(c) of the Act, the economic terms of the agreement are substantially 
at variance with the wages prevailing in the area.

                             (End of clause)

[54 FR 19831, May 8, 1989]




Sec.  52.222-48  Exemption From Application of Service Contract Act 
Provisions for Contracts for Maintenance, Calibration, and/or Repair 
of Certain Information 
          Technology, Scientific and Medical and/or Office and Business 
          Equipment--Contractor Certification.

    As prescribed in 22.1006(e)(1), insert the following clause:

   Exemption From Application of Service Contract Act Provisions For 
    Contracts For Maintenance, Calibration, and/or Repair of Certain 
    Information Technology, Scientific and Medical and/or Office and 
         Business Equipment--Contractor Certification (AUG 1996)

    (a) The following certification shall be checked:

[[Page 153]]

                              Certification

    The offeror certifies ( )/does not certify [chyph]( ) that:
    (1) The items of equipment to be serviced under this contract are 
commercial items which are used regularly for other than Government 
purposes, and are sold or traded by the Contractor in substantial 
quantities to the general public in the course of normal business 
operations;
    (2) The contract services are furnished at prices which are, or are 
based on, established catalog or market prices for the maintenance, 
calibration, and/or repair of certain information technology, scientific 
and medical and/or office and business equipment. An ``established 
catalog price'' is a price (including discount price) recorded in a 
catalog, price list, schedule, or other verifiable and established 
record that is regularly maintained by the manufacturer or the 
Contractor and is either published or otherwise available for inspection 
by customers. An ``established market price'' is a current price, 
established in the course of ordinary and usual trade between buyers and 
sellers free to bargain, which can be substantiated by data from sources 
independent of the manufacturer or Contractor; and
    (3) The Contractor utilizes the same compensation (wage and fringe 
benefits) plan for all service employees performing work under the 
contract as the Contractor uses for equivalent employees servicing the 
same equipment of commercial customers.
    (b) If a negative certification is made and a Service Contract Act 
wage determination is not attached to the solicitation, the Contractor 
shall notify the Contracting Officer as soon as possible.
    (c) Failure to execute the certification in paragraph (a) of this 
clause or to contact the Contracting Officer as required in paragraph 
(b) of this clause may render the bid or offer nonresponsive.

                             (End of clause)

[54 FR 19832, May 8, 1989, as amended at 60 FR 48221, Sept. 18, 1995; 61 
FR 41471, Aug. 8, 1996]



Sec.  52.222-49  Service Contract Act--Place of Performance Unknown.

    As prescribed in 22.1006(f) and 22.1009-4(c), insert the following 
clause:

      Service Contract Act--Place of Performance Unknown (MAY 1989)

    (a) This contract is subject to the Service Contract Act, and the 
place of performance was unknown when the solicitation was issued. In 
addition to places or areas identified in wage determinations, if any, 
attached to the solicitation, wage determinations have also been 
requested for the following: ------------ (insert places or areas). The 
Contracting Officer will request wage determinations for additional 
places or areas of performance if asked to do so in writing by --------
---- (insert time and date).
    (b) Offerors who intend to perform in a place or area of performance 
for which a wage determination has not been attached or requested may 
nevertheless submit bids or proposals. However, a wage determination 
shall be requested and incorporated in the resultant contract 
retroactive to the date of contract award, and there shall be no 
adjustment in the contract price.

                             (End of clause)

[54 FR 19832, May 8, 1989]



Sec.  52.222-50  [Reserved]



Sec.  52.223-1--52.223-2  [Reserved]



Sec.  52.223-3  Hazardous Material Identification and Material Safety Data.

    As prescribed in 23.303, insert the following clause:

  Hazardous Material Identification and Material Safety Data (JAN 1997)

    (a) Hazardous material, as used in this clause, includes any 
material defined as hazardous under the latest version of Federal 
Standard No. 313 (including revisions adopted during the term of the 
contract).
    (b) The offeror must list any hazardous material, as defined in 
paragraph (a) of this clause, to be delivered under this contract. The 
hazardous material shall be properly identified and include any 
applicable identification number, such as National Stock Number or 
Special Item Number. This information shall also be included on the 
Material Safety Data Sheet submitted under this contract.

Material (If none, insert None)
________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

Identification No.

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

    (c) This list must be updated during performance of the contract 
whenever the Contractor determines that any other material to be 
delivered under this contract is hazardous.
    (d) The apparently successful offeror agrees to submit, for each 
item as required prior to award, a Material Safety Data Sheet, meeting 
the requirements of 29 CFR

[[Page 154]]

1910.1200(g) and the latest version of Federal Standard No. 313, for all 
hazardous material identified in paragraph (b) of this clause. Data 
shall be submitted in accordance with Federal Standard No. 313, whether 
or not the apparently successful offeror is the actual manufacturer of 
these items. Failure to submit the Material Safety Data Sheet prior to 
award may result in the apparently successful offeror being considered 
nonresponsible and ineligible for award.
    (e) If, after award, there is a change in the composition of the 
item(s) or a revision to Federal Standard No. 313, which renders 
incomplete or inaccurate the data submitted under paragraph (d) of this 
clause, the Contractor shall promptly notify the Contracting Officer and 
resubmit the data.
    (f) Neither the requirements of this clause nor any act or failure 
to act by the Government shall relieve the Contractor of any 
responsibility or liability for the safety of Government, Contractor, or 
subcontractor personnel or property.
    (g) Nothing contained in this clause shall relieve the Contractor 
from complying with applicable Federal, State, and local laws, codes, 
ordinances, and regulations (including the obtaining of licenses and 
permits) in connection with hazardous material.
    (h) The Government's rights in data furnished under this contract 
with respect to hazardous material are as follows:
    (1) To use, duplicate and disclose any data to which this clause is 
applicable. The purposes of this right are to--
    (i) Apprise personnel of the hazards to which they may be exposed in 
using, handling, packaging, transporting, or disposing of hazardous 
materials;
    (ii) Obtain medical treatment for those affected by the material; 
and
    (iii) Have others use, duplicate, and disclose the data for the 
Government for these purposes.
    (2) To use, duplicate, and disclose data furnished under this 
clause, in accordance with subparagraph (h)(1) of this clause, in 
precedence over any other clause of this contract providing for rights 
in data.
    (3) The Government is not precluded from using similar or identical 
data acquired from other sources.

                             (End of clause)

    Alternate I (JUL 1995). If the contract is awarded by an agency 
other than the Department of Defense, add the following paragraph (i) to 
the basic clause:

    (i) Except as provided in paragraph (i)(2) the Contractor shall 
prepare and submit a sufficient number of Material Safety Data Sheets 
(MSDS's), meeting the requirements of 29 CFR 1910.1200(g) and the latest 
version of Federal Standard No. 313, for all hazardous materials 
identified in paragraph (b) of this clause.
    (1) For items shipped to consignees, the Contractor shall include a 
copy of the MSDS with the packing list or other suitable shipping 
document which accompanies each shipment. Alternatively, the Contractor 
is permitted to transmit MSDS's to consignees in advance of receipt of 
shipments by consignees, if authorized in writing by the Contracting 
Officer.
    (2) For items shipped to consignees identified by mailing address as 
agency depots, distribution centers or customer supply centers, the 
Contractor shall provide one copy of the MSDS's in or on each shipping 
container. If affixed to the outside of each container, the MSDS must be 
placed in a weather resistant envelope.

[56 FR 55375, Oct. 25, 1991, as amended at 60 FR 34740, July 3, 1995; 62 
FR 238, Jan. 2, 1997]



Sec.  52.223-4  Recovered Material Certification.

    As prescribed in 23.406(a), insert the following provision:

               Recovered Material Certification (OCT 1997)

    As required by the Resource Conservation and Recovery Act of 1976 
(42 U.S.C. 6962(c)(3)(A)(i)), the offeror certifies, by signing this 
offer, that the percentage of recovered materials to be used in the 
performance of the contract will be at least the amount required by the 
applicable contract specifications.

                           (End of provision)

[62 FR 44812, Aug. 22, 1997, as amended at 65 FR 36021, June 6, 2000]



Sec.  52.223-5  Pollution Prevention and Right-to-Know Information.

    As prescribed in 23.1005, insert the following clause:

      Pollution Prevention and Right-to-Know Information (Aug 2003)

    (a) Definitions. As used in this clause--
    Priority chemical means a chemical identified by the Interagency 
Environmental Leadership Workgroup or, alternatively, by an agency 
pursuant to section 503 of Executive Order 13148 of April 21, 2000, 
Greening the Government through Leadership in Environmental Management.
    Toxic chemical means a chemical or chemical category listed in 40 
CFR 372.65.
    (b) Executive Order 13148 requires Federal facilities to comply with 
the provisions of the Emergency Planning and Community

[[Page 155]]

Right-to-Know Act of 1986 (EPCRA) (42 U.S.C. 11001-11050) and the 
Pollution Prevention Act of 1990 (PPA) (42 U.S.C. 13101-13109).
    (c) The Contractor shall provide all information needed by the 
Federal facility to comply with the following:
    (1) The emergency planning reporting requirements of section 302 of 
EPCRA.
    (2) The emergency notice requirements of section 304 of EPCRA.
    (3) The list of Material Safety Data Sheets, required by section 311 
of EPCRA.
    (4) The emergency and hazardous chemical inventory forms of section 
312 of EPCRA.
    (5) The toxic chemical release inventory of section 313 of EPCRA, 
which includes the reduction and recycling information required by 
section 6607 of PPA.
    (6) The toxic chemical, priority chemical, and hazardous substance 
release and use reduction goals of sections 502 and 503 of Executive 
Order 13148.


(End of clause)
    Alternate I (Aug 2003). As prescribed in 23.1005(b), add the 
following paragraph (c)(7) to the basic clause:
    (c)(7) The environmental management system as described in section 
401 of E.O. 13148.
    Alternate II (Aug 2003). As prescribed in 23.1005(c), add the 
following paragraph (c)(7) to the basic clause. If Alternate I is also 
prescribed, renumber paragraph (c)(7) as paragraph (c)(8).
    (c)(7) The facility compliance audits as described in section 402 of 
E.O. 13148.

[68 FR 43870, July 24, 2003]



Sec.  52.223-6  Drug-Free Workplace.

    As prescribed in 23.505, insert the following clause:

                     Drug-Free Workplace (MAY 2001)

    (a) Definitions. As used in this clause--
    Controlled substance means a controlled substance in schedules I 
through V of section 202 of the Controlled Substances Act (21 U.S.C. 
812) and as further defined in regulation at 21 CFR 1308.11-1308.15.
    Conviction means a finding of guilt (including a plea of nolo 
contendere) or imposition of sentence, or both, by any judicial body 
charged with the responsibility to determine violations of the Federal 
or State criminal drug statutes.
    Criminal drug statute means a Federal or non-Federal criminal 
statute involving the manufacture, distribution, dispensing, possession 
or use of any controlled substance.
    Drug-free workplace means the site(s) for the performance of work 
done by the Contractor in connection with a specific contract where 
employees of the Contractor are prohibited from engaging in the unlawful 
manufacture, distribution, dispensing, possession, or use of a 
controlled substance.
    Employee means an employee of a Contractor directly engaged in the 
performance of work under a Government contract. Directly engaged is 
defined to include all direct cost employees and any other Contractor 
employee who has other than a minimal impact or involvement in contract 
performance.
    Individual means an offeror/contractor that has no more than one 
employee including the offeror/contractor.
    (b) The Contractor, if other than an individual, shall--within 30 
days after award (unless a longer period is agreed to in writing for 
contracts of 30 days or more performance duration); or as soon as 
possible for contracts of less than 30 days performance duration--
    (1) Publish a statement notifying its employees that the unlawful 
manufacture, distribution, dispensing, possession, or use of a 
controlled substance is prohibited in the contractor's workplace and 
specifying the actions that will be taken against employees for 
violations of such prohibition;
    (2) Establish an ongoing drug-free awareness program to inform such 
employees about--
    (i) The dangers of drug abuse in the workplace;
    (ii) The contractor's policy of maintaining a drug-free workplace;
    (iii) Any available drug counseling, rehabilitation, and employee 
assistance programs; and
    (iv) The penalties that may be imposed upon employees for drug abuse 
violations occurring in the workplace.
    (3) Provide all employees engaged in performance of the contract 
with a copy of the statement required by subparagraph (b)(1) of this 
clause;
    (4) Notify such employees in writing in the statement required by 
subparagraph (b)(1) of this clause that, as a condition of continued 
employment on this contract, the employee will--
    (i) Abide by the terms of the statement; and
    (ii) Notify the employer in writing of the employee's conviction 
under a criminal drug statute for a violation occurring in the workplace 
no later than 5 days after such conviction.
    (5) Notify the Contracting Officer in writing within 10 days after 
receiving notice under subdivision (b)(4)(ii) of this clause, from an 
employee or otherwise receiving actual notice of such conviction. The 
notice shall include the position title of the employee;
    (6) Within 30 days after receiving notice under subdivision 
(b)(4)(ii) of this clause of a conviction, take one of the following 
actions with respect to any employee who is convicted of a drug abuse 
violation occurring in the workplace:

[[Page 156]]

    (i) Taking appropriate personnel action against such employee, up to 
and including termination; or
    (ii) Require such employee to satisfactorily participate in a drug 
abuse assistance or rehabilitation program approved for such purposes by 
a Federal, State, or local health, law enforcement, or other appropriate 
agency; and
    (7) Make a good faith effort to maintain a drug-free workplace 
through implementation of subparagraphs (b)(1) through (b)(6) of this 
clause.
    (c) The Contractor, if an individual, agrees by award of the 
contract or acceptance of a purchase order, not to engage in the 
unlawful manufacture, distribution, dispensing, possession, or use of a 
controlled substance while performing this contract.
    (d) In addition to other remedies available to the Government, the 
Contractor's failure to comply with the requirements of paragraph (b) or 
(c) of this clause may, pursuant to FAR 23.506, render the Contractor 
subject to suspension of contract payments, termination of the contract 
for default, and suspension or debarment.

                             (End of clause)

[54 FR 4970, Jan. 31, 1989; 54 FR 6931, Feb. 15, 1989, as amended at 55 
FR 21708, May 25, 1990; 55 FR 30465, July 26, 1990; 61 FR 69292, Dec. 
31, 1996; 66 FR 2135, Jan. 10, 2001]



Sec.  52.223-7  Notice of radioactive materials.

    As prescribed in 23.602, insert the following clause:

               Notice of Radioactive Materials (JAN 1997)

    (a) The Contractor shall notify the Contracting Officer or designee, 
in writing, ------ * days prior to the delivery of, or prior to 
completion of any servicing required by this contract of, items 
containing either (1) radioactive material requiring specific licensing 
under the regulations issued pursuant to the Atomic Energy Act of 1954, 
as amended, as set forth in title 10 of the Code of Federal Regulations, 
in effect on the date of this contract, or (2) other radioactive 
material not requiring specific licensing in which the specific activity 
is greater than 0.002 microcuries per gram or the activity per item 
equals or exceeds 0.01 microcuries. Such notice shall specify the part 
or parts of the items which contain radioactive materials, a description 
of the materials, the name and activity of the isotope, the manufacturer 
of the materials, and any other information known to the Contractor 
which will put users of the items on notice as to the hazards involved 
(OMB No. 9000-0107).
---------------------------------------------------------------------------

    * The Contracting Officer shall insert the number of days required 
in advance of delivery of the item or completion of the servicing to 
assure that required licenses are obtained and appropriate personnel are 
notified to institute any necessary safety and health precautions. See 
FAR 23.601(d).
---------------------------------------------------------------------------

    (b) If there has been no change affecting the quantity of activity, 
or the characteristics and composition of the radioactive material from 
deliveries under this contract or prior contracts, the Contractor may 
request that the Contracting Officer or designee waive the notice 
requirement in paragraph (a) of this clause. Any such request shall--
    (1) Be submitted in writing;
    (2) State that the quantity of activity, characteristics, and 
composition of the radioactive material have not changed; and
    (3) Cite the contract number on which the prior notification was 
submitted and the contracting office to which it was submitted.
    (c) All items, parts, or subassemblies which contain radioactive 
materials in which the specific activity is greater than 0.002 
microcuries per gram or activity per item equals or exceeds 0.01 
microcuries, and all containers in which such items, parts or 
subassemblies are delivered to the Government shall be clearly marked 
and labeled as required by the latest revision of MIL-STD 129 in effect 
on the date of the contract.
    (d) This clause, including this paragraph (d), shall be inserted in 
all subcontracts for radioactive materials meeting the criteria in 
paragraph (a) of this clause.

                             (End of clause)

[56 FR 55375, Oct. 25, 1991, as amended at 62 FR 239, Jan. 2, 1997]



Sec.  52.223-8  [Reserved]



Sec.  52.223-9  Estimate of Percentage of Recovered Material Content for 
EPA-Designated Products.

    As prescribed in 23.406(b), insert the following clause:

Estimate of Percentage of Recovered Material Content for EPA-Designated 
                           Products (AUG 2000)

    (a) Definitions. As used in this clause--
    Postconsumer material means a material or finished product that has 
served its intended use and has been discarded for disposal or recovery, 
having completed its life as a consumer item. Postconsumer material is a 
part of the broader category of ``recovered material.''
    Recovered material means waste materials and by-products recovered 
or diverted from solid waste, but the term does not include those 
materials and by-products generated

[[Page 157]]

from, and commonly reused within, an original manufacturing process.
    (b) The Contractor, on completion of this contract, shall--
    (1) Estimate the percentage of the total recovered material used in 
contract performance, including, if applicable, the percentage of 
postconsumer material content; and
    (2) Submit this estimate to ---------------- [Contracting Officer 
complete in accordance with agency procedures].

                             (End of clause)

    Alternate I (August 2000). As prescribed in 23.406(b), redesignate 
paragraph (b) of the basic clause as paragraph (c) and add the following 
paragraph (b) to the basic clause:

    (b) The Contractor shall execute the following certification 
required by the Resource Conservation and Recovery Act of 1976 (42 
U.S.C. 6962(i)(2)(C)):

                              Certification

    I, ------------ (name of certifier), am an officer or employee 
responsible for the performance of this contract and hereby certify that 
the percentage of recovered material content for EPA-designated products 
met the applicable contract specifications.
________________________________________________________________________
(Signature of the Officer or Employee)
________________________________________________________________________
(Typed Name of the Officer or Employee)
________________________________________________________________________
(Title)
________________________________________________________________________
(Name of Company, Firm, or Organization)
________________________________________________________________________
(Date)
________________________________________________________________________

                         (End of certification)

[65 FR 36021, June 6, 2000]



Sec.  52.223-10  Waste Reduction Program.

    As prescribed in 23.705, insert the following clause:

                   Waste Reduction Program (AUG 2000)

    (a) Definitions. As used in this clause--
    Recycling means the series of activities, including collection, 
separation, and processing, by which products or other materials are 
recovered from the solid waste stream for use in the form of raw 
materials in the manufacture of products other than fuel for producing 
heat or power by combustion.
    Waste prevention means any change in the design, manufacturing, 
purchase, or use of materials or products (including packaging) to 
reduce their amount or toxicity before they are discarded. Waste 
prevention also refers to the reuse of products or materials.
    Waste reduction means preventing or decreasing the amount of waste 
being generated through waste prevention, recycling, or purchasing 
recycled and environmentally preferable products.
    (b) Consistent with the requirements of Section 701 of Executive 
Order 13101, the Contractor shall establish a program to promote cost-
effective waste reduction in all operations and facilities covered by 
this contract. The Contractor's programs shall comply with applicable 
Federal, State, and local requirements, specifically including Section 
6002 of the Resource Conservation and Recovery Act (42 U.S.C. 6962, et 
seq.) and implementing regulations (40 CFR part 247).

                             (End of clause)

[65 FR 36021, June 6, 2000]



Sec.  52.223-11  Ozone-Depleting Substances.

    As prescribed in 23.804(a), insert the following clause:

                  Ozone-Depleting Substances (MAY 2001)

    (a) Definition. Ozone-depleting substance, as used in this clause, 
means any substance the Environmental Protection Agency designates in 40 
CFR part 82 as--
    (1) Class I, including, but not limited to, chlorofluorocarbons, 
halons, carbon tetrachloride, and methyl chloroform; or
    (2) Class II, including, but not limited to, 
hydrochlorofluorocarbons.
    (b) The Contractor shall label products which contain or are 
manufactured with ozone-depleting substances in the manner and to the 
extent required by 42 U.S.C. 7671j (b), (c), and (d) and 40 CFR part 82, 
subpart E, as follows:
    ``WARNING: Contains (or manufactured with, if applicable)
 *, a substance(s) which harm(s) public health and environment by 
destroying ozone in the upper atmosphere.''_____________________________
    * The Contractor shall insert the name of the substance(s).

                             (End of clause)

[61 FR 31645, June 20, 1996, as amended at 66 FR 2135, Jan. 10, 2001]



Sec.  52.223-12  Refrigeration Equipment and Air Conditioners.

    As prescribed in 23.804(b), insert the following clause:

         Refrigeration Equipment and Air Conditioners (MAY 1995)

    The Contractor shall comply with the applicable requirements of 
sections 608 and 609

[[Page 158]]

of the Clean Air Act (42 U.S.C. 7671g and 7671h) as each or both apply 
to this contract.

                             (End of clause)

[60 FR 28501, May 31, 1995]



Sec.  52.223-13  Certification of Toxic Chemical Release Reporting.

    As prescribed in 23.906(a), insert the following provision:

      Certification of Toxic Chemical Release Reporting (Aug. 2003)

    (a) Executive Order 13148, of April 21, 2000, Greening the 
Government through Leadership in Environmental Management, requires 
submission of this ertification as a prerequisite for contract award.
    (b) By signing this offer, the offeror certifies that--
    (1) As the owner or operator of facilities that will be used in the 
performance of this contract that are subject to the filing and 
reporting requirements described in section 313 of the Emergency 
Planning and Community Right-to-Know Act of 1986 (EPCRA) (42 U.S.C. 
11023) and section 6607 of the Pollution Prevention Act of 1990 (PPA) 
(42 U.S.C. 13106), the offeror will file and continue to file for such 
facilities for the life of the contract the Toxic Chemical Release 
Inventory Form (Form R) as described in sections 313 (a) and (g) of 
EPCRA and section 6607 of PPA; or
    (2) None of its owned or operated facilities to be used in the 
performance of this contract is subject to the Form R filing and 
reporting requirements because each such facility is exempt for at least 
one of the following reasons: (Check each block that is applicable.)
    [squ] (i) The facility does not manufacture, process, or otherwise 
use any toxic chemicals listed in 40 CFR 372.65;
    [squ] (ii) The facility does not have 10 or more full-time employees 
as specified in section 313(b)(1)(A) of EPCRA, 42 U.S.C. 11023(b)(1)(A);
    [squ] (iii) The facility does not meet the reporting thresholds of 
toxic chemicals established under section 313(f) of EPCRA, 42 U.S.C. 
11023(f) (including the alternate thresholds at 40 CFR 372.27, provided 
an appropriate certification form has been filed with EPA);
    [squ] (iv) The facility does not fall within the following Standard 
Industrial Classification (SIC) codes or their corresponding North 
American Industry Classification System sectors:
    (A) Major group code 10 (except 1011, 1081, and 1094.
    (B) Major group code 12 (except 1241).
    (C) Major group codes 20 through 39.
    (D) Industry code 4911, 4931, or 4939 (limited to facilities that 
combust coal and/or oil for the purpose of generating power for 
distribution in commerce).
    (E) Industry code 4953 (limited to facilities regulated under the 
Resource Conservation and Recovery Act, Subtitle C (42 U.S.C. 6921, et 
seq.), 5169, 5171, or 7389 (limited to facilities primarily engaged in 
solvent recovery services on a contract or fee basis); or
    [squ] (v) The facility is not located in the United States or its 
outlying areas.

                           (End of provision)

[61 FR 41475, Aug. 8, 1996, as amended at 65 FR 46058, July 26, 2000; 68 
FR 28086, May 22, 2003; 68 FR 43870, July 24, 2003]



Sec.  52.223-14  Toxic Chemical Release Reporting.

    As prescribed in 23.906(b), insert the following clause:

              Toxic Chemical Release Reporting (Aug. 2003)

    (a) Unless otherwise exempt, the Contractor, as owner or operator of 
a facility used in the performance of this contract, shall file by July 
1 for the prior calendar year an annual Toxic Chemical Release Inventory 
Form (Form R) as described in sections 313 (a) and (g) of the Emergency 
Planning and Community Right-to-Know Act of 1986 (EPCRA) (42 U.S.C. 
11023 (a) and (g)), and section 6607 of the Pollution Prevention Act of 
1990 (PPA) (42 U.S.C. 13106). The Contractor shall file, for each 
facility subject to the Form R filing and reporting requirements, the 
annual Form R throughout the life of the contract.
    (b) A Contractor-owned or -operated facility used in the performance 
of this contract is exempt from the requirement to file an annual Form R 
if--
    (1) The facility does not manufacture, process, or otherwise use any 
toxic chemicals listed in 40 CFR 372.65;
    (2) The facility does not have 10 or more full-time employees as 
specified in section 313(b)(1)(A) of EPCRA, 42 U.S.C. 11023(b)(1)(A);
    (3) The facility does not meet the reporting thresholds of toxic 
chemicals established under section 313(f) of EPCRA, 42 U.S.C. 11023(f) 
(including the alternate thresholds at 40 CFR 372.27, provided an 
appropriate certification form has been filed with EPA);
    (4) The facility does not fall within the following Standard 
Industrial Classification (SIC) codes or their corresponding North 
American Industry Classification System sectors:
    (i) Major group code 10 (except 1011, 1081, and 1094.
    (ii) Major group code 12 (except 1241).

[[Page 159]]

    (iii) Major group codes 20 through 39.
    (iv) Industry code 4911, 4931, or 4939 (limited to facilities that 
combust coal and/or oil for the purpose of generating power for 
distribution in commerce).
    (v) Industry code 4953 (limited to facilities regulated under the 
Resource Conservation and Recovery Act, Subtitle C (42 U.S.C. 6921, et 
seq.)), 5169, 5171, or 7389 (limited to facilities primarily engaged in 
solvent recovery services on a contract or fee basis); or
    (5) The facility is not located in the United States or its outlying 
areas.
    (c) If the Contractor has certified to an exemption in accordance 
with one or more of the criteria in paragraph (b) of this clause, and 
after award of the contract circumstances change so that any of its 
owned or operated facilities used in the performance of this contract is 
no longer exempt--
    (1) The Contractor shall notify the Contracting Officer; and
    (2) The Contractor, as owner or operator of a facility used in the 
performance of this contract that is no longer exempt, shall (i) submit 
a Toxic Chemical Release Inventory Form (Form R) on or before July 1 for 
the prior calendar year during which the facility becomes eligible; and 
(ii) continue to file the annual Form R for the life of the contract for 
such facility.
    (d) The Contracting Officer may terminate this contract or take 
other action as appropriate, if the Contractor fails to comply 
accurately and fully with the EPCRA and PPA toxic chemical release 
filing and reporting requirements.
    (e) Except for acquisitions of commercial items as defined in FAR 
Part 2, the Contractor shall--
    (1) For competitive subcontracts expected to exceed $100,000 
(including all options), include a solicitation provision substantially 
the same as the provision at FAR 52.223-13, Certification of Toxic 
Chemical Release Reporting; and
    (2) Include in any resultant subcontract exceeding $100,000 
(including all options), the substance of this clause, except this 
paragraph (e).

                             (End of clause)

[61 FR 41475, Aug. 8, 1996, as amended at 65 FR 46058, July 26, 2000; 68 
FR 28086, May 22, 2003; 68 FR 43870, July 24, 2003]



Sec.  52.224-1  Privacy Act Notification.

    As prescribed in 24.104, insert the following clause in 
solicitations and contracts, when the design, development, or operation 
of a system of records on individuals is required to accomplish an 
agency function:

                   Privacy Act Notification (APR 1984)

    The Contractor will be required to design, develop, or operate a 
system of records on individuals, to accomplish an agency function 
subject to the Privacy Act of 1974, Public Law 93-579, December 31, 1974 
(5 U.S.C. 552a) and applicable agency regulations. Violation of the Act 
may involve the imposition of criminal penalties.

                             (End of clause)



Sec.  52.224-2  Privacy Act.

    As prescribed in 24.104, insert the following clause in 
solicitations and contracts, when the design, development, or operation 
of a system of records on individuals is required to accomplish an 
agency function:

                         Privacy Act (APR 1984)

    (a) The Contractor agrees to--
    (1) Comply with the Privacy Act of 1974 (the Act) and the agency 
rules and regulations issued under the Act in the design, development, 
or operation of any system of records on individuals to accomplish an 
agency function when the contract specifically identifies--
    (i) The systems of records; and
    (ii) The design, development, or operation work that the contractor 
is to perform;
    (2) Include the Privacy Act notification contained in this contract 
in every solicitation and resulting subcontract and in every subcontract 
awarded without a solicitation, when the work statement in the proposed 
subcontract requires the design, development, or operation of a system 
of records on individuals that is subject to the Act; and
    (3) Include this clause, including this subparagraph (3), in all 
subcontracts awarded under this contract which requires the design, 
development, or operation of such a system of records.
    (b) In the event of violations of the Act, a civil action may be 
brought against the agency involved when the violation concerns the 
design, development, or operation of a system of records on individuals 
to accomplish an agency function, and criminal penalties may be imposed 
upon the officers or employees of the agency when the violation concerns 
the operation of a system of records on individuals to accomplish an 
agency function. For purposes of the Act, when the contract is for the 
operation of a system of records on individuals to accomplish an agency 
function, the Contractor and any employee of the Contractor is 
considered to be an employee of the agency.
    (c)(1) Operation of a system of records, as used in this clause, 
means performance of

[[Page 160]]

any of the activities associated with maintaining the system of records, 
including the collection, use, and dissemination of records.
    (2) Record, as used in this clause, means any item, collection, or 
grouping of information about an individual that is maintained by an 
agency, including, but not limited to, education, financial 
transactions, medical history, and criminal or employment history and 
that contains the person's name, or the identifying number, symbol, or 
other identifying particular assigned to the individual, such as a 
fingerprint or voiceprint or a photograph.
    (3) System of records on individuals, as used in this clause means a 
group of any records under the control of any agency from which 
information is retrieved by the name of the individual or by some 
identifying number, symbol, or other identifying particular assigned to 
the individual.

                             (End of clause)



Sec.  52.225-1  Buy American Act--Supplies.

    As prescribed in 25.1101(a)(1), insert the following clause:

                 Buy American Act--Supplies. (June 2003)

    (a) Definitions. As used in this clause--
    Component means an article, material, or supply incorporated 
directly into an end product.
    Cost of components means--
    (1) For components purchased by the Contractor, the acquisition 
cost, including transportation costs to the place of incorporation into 
the end product (whether or not such costs are paid to a domestic firm), 
and any applicable duty (whether or not a duty-free entry certificate is 
issued); or
    (2) For components manufactured by the Contractor, all costs 
associated with the manufacture of the component, including 
transportation costs as described in paragraph (1) of this definition, 
plus allocable overhead costs, but excluding profit. Cost of components 
does not include any costs associated with the manufacture of the end 
product.
    Domestic end product means--
    (1) An unmanufactured end product mined or produced in the United 
States; or
    (2) An end product manufactured in the United States, if the cost of 
its components mined, produced, or manufactured in the United States 
exceeds 50 percent of the cost of all its components. Components of 
foreign origin of the same class or kind as those that the agency 
determines are not mined, produced, or manufactured in sufficient and 
reasonably available commercial quantities of a satisfactory quality are 
treated as domestic. Scrap generated, collected, and prepared for 
processing in the United States is considered domestic.
    End product means those articles, materials, and supplies to be 
acquired under the contract for public use.
    Foreign end product means an end product other than a domestic end 
product.
    United States means the 50 States, the District of Columbia, and 
outlying areas.
    (b) The Buy American Act (41 U.S.C. 10a-10d) provides a preference 
for domestic end products for supplies acquired for use in the United 
States.
    (c) Offerors may obtain from the Contracting Officer a list of 
foreign articles that the Contracting Officer will treat as domestic for 
this contract.
    (d) The Contractor shall deliver only domestic end products except 
to the extent that it specified delivery of foreign end products in the 
provision of the solicitation entitled ``Buy American Act Certificate.''

                             (End of clause)

[64 FR 72433, Dec. 27, 1999, as amended at 66 FR 65350, Dec. 18, 2001; 
67 FR 21536, Apr. 30, 2002; 68 FR 28086, May 22, 2003]



Sec.  52.225-2  Buy American Act Certificate.

    As prescribed in 25.1101(a)(2), insert the following provision:

                Buy American Act Certificate (June 2003)

    (a) The offeror certifies that each end product, except those listed 
in paragraph (b) of this provision, is a domestic end product and that 
the offeror has considered components of unknown origin to have been 
mined, produced, or manufactured outside the United States. The offeror 
shall list as foreign end products those end products manufactured in 
the United States that do not qualify as domestic end products. The 
terms ``component,'' ``domestic end product,'' ``end product,'' 
``foreign end product,'' and ``United States'' are defined in the clause 
of this solicitation entitled ``Buy American Act--Supplies.''
    (b) Foreign End Products:
Line Item No.:__________________________________________________________
Country of Origin:______________________________________________________
    (List as necessary)
    (c) The Government will evaluate offers in accordance with the 
policies and procedures of Part 25 of the Federal Acquisition 
Regulation.

                           (End of provision)

[64 FR 72434, Dec. 27, 1999; 65 FR 4633, Jan. 31, 2000, as amended at 67 
FR 21536, Apr. 30, 2002; 68 FR 28086, May 22, 2003]

[[Page 161]]



Sec.  52.225-3  Buy American Act--North American Free Trade Agreement--Israeli Trade Act.

    As prescribed in 25.1101(b)(1)(i), insert the following clause:

Buy American Act--North American Free Trade Agreement--Israeli Trade Act 
                               (June 2003)

    (a) Definitions. As used in this clause--
    Component means an article, material, or supply incorporated 
directly into an end product.
    Cost of components means--
    (1) For components purchased by the Contractor, the acquisition 
cost, including transportation costs to the place of incorporation into 
the end product (whether or not such costs are paid to a domestic firm), 
and any applicable duty (whether or not a duty-free entry certificate is 
issued); or
    (2) For components manufactured by the Contractor, all costs 
associated with the manufacture of the component, including 
transportation costs as described in paragraph (1) of this definition, 
plus allocable overhead costs, but excluding profit. Cost of components 
does not include any costs associated with the manufacture of the end 
product.
    Domestic end product means--
    (1) An unmanufactured end product mined or produced in the United 
States; or
    (2) An end product manufactured in the United States, if the cost of 
its components mined, produced, or manufactured in the United States 
exceeds 50 percent of the cost of all its components. Components of 
foreign origin of the same class or kind as those that the agency 
determines are not mined, produced, or manufactured in sufficient and 
reasonably available commercial quantities of a satisfactory quality are 
treated as domestic. Scrap generated, collected, and prepared for 
processing in the United States is considered domestic.
    End product means those articles, materials, and supplies to be 
acquired under the contract for public use.
    Foreign end product means an end product other than a domestic end 
product.
    Israeli end product means an article that--
    (1) Is wholly the growth, product, or manufacture of Israel; or
    (2) In the case of an article that consists in whole or in part of 
materials from another country, has been substantially transformed in 
Israel 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.
    North American Free Trade Agreement country means Canada or Mexico.
    North American Free Trade Agreement country end product means an 
article that--
    (1) Is wholly the growth, product, or manufacture of a North 
American Free Trade Agreement (NAFTA) country; or
    (2) In the case of an article that consists in whole or in part of 
materials from another country, has been substantially transformed in a 
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 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 the article, provided that the value of those 
incidental services does not exceed that of the article itself.
    United States means the 50 States, the District of Columbia, and 
outlying areas.
    (b) Components of foreign origin. Offerors may obtain from the 
Contracting Officer a list of foreign articles that the Contracting 
Officer will treat as domestic for this contract.
    (c) Implementation. This clause implements the Buy American Act (41 
U.S.C. 10a-10d), the North American Free Trade Agreement Implementation 
Act (NAFTA) (19 U.S.C. 3301 note), and the Israeli Free Trade Area 
Implementation Act of 1985 (Israeli Trade Act) (19 U.S.C. 2112 note) by 
providing a preference for domestic end products, except for certain 
foreign end products that are NAFTA country end products or Israeli end 
products.
    (d) Delivery of end products. The Contracting Officer has determined 
that NAFTA and the Israeli Trade Act apply to this acquisition. Unless 
otherwise specified, these trade agreements apply to all items in the 
Schedule. The Contractor shall deliver under this contract only domestic 
end products except to the extent that, in its offer, it specified 
delivery of foreign end products in the provision entitled ``Buy 
American Act--North American Free Trade Agreement--Israeli Trade Act 
Certificate.'' If the Contractor specified in its offer that the 
Contractor would supply a NAFTA country end product or an Israeli end 
product, then the Contractor shall supply a NAFTA country end product, 
an Israeli end product or, at the Contractor's option, a domestic end 
product.

                             (End of clause)

    Alternate I (May 2002). As prescribed in 25.1101(b)(1)(ii), add the 
following definition to paragraph (a) of the basic clause, and 
substitute the following paragraph (d) for paragraph (d) of the basic 
clause:

    Canadian end product means an article that--
    (1) Is wholly the growth, product, or manufacture of Canada; or

[[Page 162]]

    (2) In the case of an article that consists in whole or in part of 
materials from another country, has 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 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 the article, provided that the value of those 
incidental services does not exceed that of the article itself.
    (d) Delivery of end products. The Contracting Officer has determined 
that NAFTA applies to this acquisition. Unless otherwise specified, 
NAFTA applies to all items in the Schedule. The Contractor shall deliver 
under this contract only domestic end products except to the extent 
that, in its offer, it specified delivery of foreign end products in the 
provision entitled ``Buy American Act--North American Free Trade 
Agreement--Israeli Trade Act Certificate.'' If the Contractor specified 
in its offer that the Contractor would supply a Canadian end product, 
then the Contractor shall supply a Canadian end product or, at the 
Contractor's option, a domestic end product.

    Alternate II (May 2002). As prescribed in 25.1101(b)(1)(iii), add 
the following definition to paragraph (a) of the basic clause, and 
substitute the following paragraph (d) for paragraph (d) of the basic 
clause:

    Canadian end product means an article that--
    (1) Is wholly the growth, product, or manufacture of Canada; or
    (2) In the case of an article that consists in whole or in part of 
materials from another country, has 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 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 the article, provided that the value of those 
incidental services does not exceed that of the article itself.
    (d) Delivery of end products. The Contracting Officer has determined 
that NAFTA and the Israeli Trade Act apply to this acquisition. Unless 
otherwise specified, these trade agreements apply to all items in the 
Schedule. The Contractor shall deliver under this contract only domestic 
end products except to the extent that, in its offer, it specified 
delivery of foreign end products in the provision entitled ``Buy 
American Act--North American Free Trade Agreement--Israeli Trade Act.'' 
If the Contractor specified in its offer that the Contractor would 
supply a Canadian end product or an Israeli end product, then the 
Contractor shall supply a Canadian end product, an Israeli end product 
or, at the Contractor's option, a domestic end product.

[64 FR 72434, Dec. 27, 1999, as amended at 66 FR 65350, Dec. 18, 2001; 
67 FR 21536, Apr. 30, 2002; 68 FR 28086, May 22, 2003]



Sec.  52.225-4  Buy American Act North American Free Trade Agreement--Israeli 
Trade Act Certificate.

    As prescribed in 25.1101(b)(2)(i), insert the following provision:

Buy American Act North American Free Trade Agreement--Israeli Trade Act 
                         Certificate (June 2003)

    (a) The offeror certifies that each end product, except those listed 
in paragraph (b) or (c) of this provision, is a domestic end product and 
that the offeror has considered components of unknown origin to have 
been mined, produced, or manufactured outside the United States. The 
terms ``component,'' ``domestic end product,'' ``end product,'' 
``foreign end product,'' and ``United States'' are defined in the clause 
of this solicitation entitled ``Buy American Act--North American Free 
Trade Agreement--Israeli Trade Act.''
    (b) The offeror certifies that the following supplies are NAFTA 
country end products or Israeli end products as defined in the clause of 
this solicitation entitled ``Buy American Act--North American Free Trade 
Agreement--Israeli Trade Act'':

                 NAFTA Country or Israeli End Products:

Line Item No.___________________________________________________________
Country of Origin_______________________________________________________
    (List as necessary)
    (c) The offeror shall list those supplies that are foreign end 
products (other than those listed in paragraph (b) of this provision) as 
defined in the clause of this solicitation entitled ``Buy American Act--
North American Free Trade Agreement--Israeli Trade Act.'' The offeror 
shall list as other foreign end products those end products manufactured 
in the United States that do not qualify as domestic end products.

                       Other Foreign End Products

Line Item No.:__________________________________________________________
Country of Origin:______________________________________________________
    (List as necessary)
    (d) The Government will evaluate offers in accordance with the 
policies and procedures of Part 25 of the Federal Acquisition 
Regulation.

[[Page 163]]

                           (End of provision)

    Alternate I (May 2002). As prescribed in 25.1101(b)(2)(ii), 
substitute the following paragraph (b) for paragraph (b) of the basic 
provision:

    (b) The offeror certifies that the following supplies are Canadian 
end products as defined in the clause of this solicitation entitled 
``Buy American Act--North American Free Trade Agreement--Israeli Trade 
Act--Balance of Payments Program'':

                         Canadian End Products:

Line Item No.___________________________________________________________
    (List as necessary)

    Alternate II (May 2002). As prescribed in 25.1101(b)(2)(iii), 
substitute the following paragraph (b) for paragraph (b) of the basic 
provision:

    (b) The offeror certifies that the following supplies are Canadian 
end products or Israeli end products as defined in the clause of this 
solicitation entitled ``Buy American Act--North American Free Trade 
Agreement--Israeli Trade Act--Balance of Payments Program'':

                    Canadian or Israeli End Products

Line Item No.:__________________________________________________________
Country of Origin:______________________________________________________
    (List as necessary)

[64 FR 72435, Dec. 27, 1999; 65 FR 4633, Jan. 31, 2000, as amended at 67 
FR 21536, May 15, 2002; 68 FR 28086, May 22, 2003]



Sec.  52.225-5  Trade Agreements.

    As prescribed in 25.1101(c)(1), insert the following clause:

                      Trade Agreements (June 2003)

    (a) Definitions. As used in this clause.
    Caribbean Basin country means any of the following countries: 
Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, British Virgin 
Islands, Costa Rica, Dominica, El Salvador, Grenada, Guatemala, Guyana, 
Haiti, Honduras, Jamaica, Montserrat, Netherlands Antilles, Nicaragua, 
St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Trinidad 
and Tobago.
    Caribbean Basin country end product--
    (1) Means an article that--
    (i)(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, has been substantially transformed in a 
Caribbean Basin country into a new and different article of commerce 
with a name, character, or use distinct from that of the article or 
articles from which it was transformed; and
    (ii) Is not excluded from duty-free treatment for Caribbean 
countries under 19 U.S.C. 2703(b).
    (A) For this reason, the following articles are not Caribbean Basin 
country end products:
    (1) Tuna, prepared or preserved in any manner in airtight 
containers;
    (2) Petroleum, or any product derived from petroleum;
    (3) Watches and watch parts (including cases, bracelets, and straps) 
of whatever type including, but not limited to, mechanical, quartz 
digital, or quartz analog, if such watches or watch parts contain any 
material that is the product of any country to which the Harmonized 
Tariff Schedule of the United States (HTSUS) column 2 rates of duty 
apply (i.e., Afghanistan, Cuba, Laos, North Korea, and Vietnam); and
    (4) Certain of the following: textiles and apparel articles; 
footwear, handbags, luggage, flat goods, work gloves, and leather 
wearing apparel; or handloomed, handmade, and folklore articles;
    (B) Access to the HTSUS to determine duty-free status of articles of 
these types is available at http://www.customs.ustreas.gov/impoexpo/
impoexpo.htm. In particular, see the following:
    (1) General Note 3(c), Products Eligible for Special Tariff 
treatment.
    (2) General Note 17, Products of Countries Designated as Beneficiary 
Countries under the United States--Caribbean Basin Trade Partnership Act 
of 2000.
    (3) Section XXII, Chapter 98, Subchapter II, Articles Exported and 
Returned, Advanced or Improved Abroad, U.S. Note 7(b).
    (4) Section XXII, Chapter 98, Subchapter XX, Goods Eligible for 
Special Tariff Benefits under the United States--Caribbean Basin Trade 
Partnership Act; and
    (2) Refers to a product offered for purchase under a supply 
contract, but for purposes of calculating the value of the acquisition, 
includes services (except transportation services) incidental to the 
article, provided that the value of those incidental services does not 
exceed that of the article itself.
    Designated country means any of the following countries:
    Aruba, Austria, Bangladesh Belgium, Benin, Bhutan, Botswana, Burkina 
Faso, Burundi, Canada, Cape Verde, Central African Republic, Chad, 
Comoros, Denmark, Djibouti, Equatorial Guinea.
    Finland, France, Gambia, Germany, Greece, Guinea, Guinea-Bissau, 
Haiti, Hong Kong, Iceland, Ireland, Israel, Italy, Japan.
    Kiribati, Korea, Republic of Lesotho, Liechtenstein, Luxembourg, 
Malawi, Maldives, Mali, Mozambique, Nepal, Netherlands, Niger, Norway, 
Portugal, Rwanda.

[[Page 164]]

    Sao Tome and Principe, Sierra Leone, Singapore, Somalia, Spain, 
Sweden, Switzerland, Tanzania U.R., Togo, Tuvalu, Uganda, United 
Kingdom, Vanuatu, Western Samoa, Yemen.
    Designated country end product means an article that--
    (1) Is wholly the growth, product, or manufacture of a designated 
country; or
    (2) In the case of an article that consists in whole or in part of 
materials from another country, has been substantially transformed in a 
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 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 the article, provided that the value of those 
incidental services does not exceed that of the article itself.
    End product means those articles, materials, and supplies to be 
acquired under the contract for public use.
    North American Free Trade Agreement country means Canada or Mexico.
    North American Free Trade Agreement country end product means an 
article that--
    (1) Is wholly the growth, product, or manufacture of a North 
American Free Trade Agreement (NAFTA) country; or
    (2) In the case of an article that consists in whole or in part of 
materials from another country, has been substantially transformed in a 
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 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 the article, provided that the value of those 
incidental services does not exceed that of the article itself.
    United States means the 50 States, the District of Columbia, and 
outlying areas.
    U.S.-made end product means an article that is mined, produced, or 
manufactured in the United States or that is substantially transformed 
in the United States into a new and different article of commerce with a 
name, character, or use distinct from that of the article or articles 
from which it was transformed.,
    (b) Implementation. This clause implements the Trade, Agreements Act 
(19 U.S.C. 2501, et seq.) and the North American Free Trade Agreement 
Implementation Act of 1993, (NAFTA) (19 U.S.C. 3301 note), by 
restricting the acquisition of end products that are not U.S.-made, 
designated country, Caribbean Basin country, or NAFTA country end 
products.,
    (c) Delivery of end products. The Contracting Officer has determined 
that the Trade Agreements Act and NAFTA apply to this acquisition. 
Unless otherwise specified, these trade agreements apply to all items in 
the Schedule. The Contractor shall deliver under this contract only 
U.S.-made, designated country, Caribbean Basin country, or NAFTA country 
end products except to the extent that, in its offer, it specified 
delivery of other end products in the provision entitled ``Trade 
Agreements Certificate.''

                             (End of clause)

[64 FR 72435, Dec. 27, 1999, as amended at 65 FR 24322, Apr. 25, 2000; 
66 FR 65350, 65371, Dec. 18, 2001; 67 FR 6119, Feb. 8, 2002; 67 FR 
70520, Nov. 22, 2002; 68 FR 28086, May 22, 2003]

    Effective Date Note: At 68 FR 56685, Oct. 1, 2003, Sec.  52.225-5 
was amended by revising the date of the clause to read ``(Oct. 2003)'', 
and in paragraph (a) by adding the words ``Dominican Republic'' after 
the word ``Dominica'' in the definition of ``Caribbean Basin country'' 
effective Oct. 31, 2003.



Sec.  52.225-6  Trade Agreements Certificate.

    As prescribed in 25.1101(c)(2), insert the following provision:

                 Trade Agreements Certificate (MAY 2002)

    (a) The offeror certifies that each end product, except those listed 
in paragraph (b) of this provision, is a U.S.-made, designated country, 
Caribbean Basin country, or NAFTA country end product, as defined in the 
clause of this solicitation entitled ``Trade Agreements.''
    (b) The offeror shall list as other end products those supplies that 
are not U.S.-made, designated country, Caribbean Basin country, or NAFTA 
country end products.

                           Other End Products

                             Line Item No.:

Country of Origin:______________________________________________________
    (List as necessary),
    (c) The Government will evaluate offers in accordance with the 
policies and procedures of Part 25 of the Federal Acquisition 
Regulation. For line items subject to the Trade Agreements Act, the 
Government will evaluate offers of U.S.-made, designated country, 
Caribbean Basin country, or NAFTA country end products without regard to 
the restrictions of the Buy American Act. The Government will consider 
for award only offers of U.S.-made, designated country, Caribbean Basin 
country, or NAFTA country end products unless the Contracting Officer 
determines that there are no offers for those products or that the 
offers for those products are

[[Page 165]]

insufficient to fulfill the requirements of this solicitation.

                           (End of provision)

[64 FR 72436, Dec. 27, 1999, as amended at 67 FR 21537, Apr. 30, 2002]



Sec.  52.225-7  Waiver of Buy American Act for Civil Aircraft and Related Articles.

    As prescribed in 25.1101(d), insert the following provision:

Waiver of Buy American Act for Civil Aircraft and Related Articles (FEB 
                                  2000)

    (a) Definition. Civil aircraft and related articles, as used in this 
provision, means--
    (1) All aircraft other than aircraft to be purchased for use by the 
Department of Defense or the U.S. Coast Guard;
    (2) The engines (and parts and components for incorporation into the 
engines) of these aircraft;
    (3) Any other parts, components, and subassemblies for incorporation 
into the aircraft; and
    (4) Any ground flight simulators, and parts and components of these 
simulators, for use with respect to the aircraft, whether to be used as 
original or replacement equipment in the manufacture, repair, 
maintenance, rebuilding, modification, or conversion of the aircraft, 
and without regard to whether the aircraft or articles receive duty-free 
treatment under section 601(a)(2) of the Trade Agreements Act.
    (b) The U.S. Trade Representative has waived the Buy American Act 
for acquisitions of civil aircraft and related articles from countries 
that are parties to the Agreement on Trade in Civil Aircraft. Those 
countries are Austria, Belgium, Bulgaria, Canada, Denmark, Egypt, 
Finland, France, Germany, Greece, Ireland, Italy, Japan, Luxembourg, 
Macao, the Netherlands, Norway, Portugal, Romania, Spain, Sweden, 
Switzerland, and the United Kingdom.
    (c) For the purpose of this waiver, an article is a product of a 
country only if--
    (1) It is wholly the growth, product, or manufacture of that 
country; or
    (2) In the case of an article that consists in whole or in part of 
materials from another country, it has been substantially transformed 
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.
    (d) The waiver is subject to modification or withdrawal by the U.S. 
Trade Representative.

                           (End of provision)

[64 FR 72436, Dec. 27, 1999]



Sec.  52.225-8  Duty-Free Entry.

    As prescribed in 25.1101(e), insert the following clause:

                       Duty-Free Entry (FEB 2000)

    (a) Definition. Customs territory of the United States means the 
States, the District of Columbia, and Puerto Rico.
    (b) Except as otherwise approved by the Contracting Officer, the 
Contractor shall not include in the contract price any amount for duties 
on supplies specifically identified in the Schedule to be accorded duty-
free entry.
    (c) Except as provided in paragraph (d) of this clause or elsewhere 
in this contract, the following procedures apply to supplies not 
identified in the Schedule to be accorded duty-free entry:
    (1) The Contractor shall notify the Contracting Officer in writing 
of any purchase of foreign supplies (including, without limitation, raw 
materials, components, and intermediate assemblies) in excess of $10,000 
that are to be imported into the customs territory of the United States 
for delivery to the Government under this contract, either as end 
products or for incorporation into end products. The Contractor shall 
furnish the notice to the Contracting Officer at least 20 calendar days 
before the importation. The notice shall identify the--
    (i) Foreign supplies;
    (ii) Estimated amount of duty; and
    (iii) Country of origin.
    (2) The Contracting Officer will determine whether any of these 
supplies should be accorded duty-free entry and will notify the 
Contractor within 10 calendar days after receipt of the Contractor's 
notification.
    (3) Except as otherwise approved by the Contracting Officer, the 
contract price shall be reduced by (or the allowable cost shall not 
include) the amount of duty that would be payable if the supplies were 
not entered duty-free.
    (d) The Contractor is not required to provide the notification under 
paragraph (c) of this clause for purchases of foreign supplies if--
    (1) The supplies are identical in nature to items purchased by the 
Contractor or any subcontractor in connection with its commercial 
business; and
    (2) Segregation of these supplies to ensure use only on Government 
contracts containing duty-free entry provisions is not economical or 
feasible.
    (e) The Contractor shall claim duty-free entry only for supplies to 
be delivered to the Government under this contract, either as end 
products or incorporated into end products, and shall pay duty on 
supplies, or any

[[Page 166]]

portion of them, other than scrap, salvage, or competitive sale 
authorized by the Contracting Officer, diverted to nongovernmental use.
    (f) The Government will execute any required duty-free entry 
certificates for supplies to be accorded duty-free entry and will assist 
the Contractor in obtaining duty-free entry for these supplies.
    (g) Shipping documents for supplies to be accorded duty-free entry 
shall consign the shipments to the contracting agency in care of the 
Contractor and shall include the--
    (1) Delivery address of the Contractor (or contracting agency, if 
appropriate);
    (2) Government prime contract number;
    (3) Identification of carrier;
    (4) Notation ``UNITED STATES GOVERNMENT, ------ [agency], ------ 
Duty-free entry to be claimed pursuant to Item No(s) ------ [from Tariff 
Schedules] ------, Harmonized Tariff Schedules of the United States. 
Upon arrival of shipment at port of entry, District Director of Customs, 
please release shipment under 19 CFR part 142 and notify [cognizant 
contract administration office] for execution of Customs Forms 7501 and 
7501-A and any required duty-free entry certificates.'';
    (5) Gross weight in pounds (if freight is based on space tonnage, 
state cubic feet in addition to gross shipping weight); and
    (6) Estimated value in United States dollars.
    (h) The Contractor shall instruct the foreign supplier to--
    (1) Consign the shipment as specified in paragraph (g) of this 
clause;
    (2) Mark all packages with the words ``UNITED STATES GOVERNMENT'' 
and the title of the contracting agency; and
    (3) Include with the shipment at least two copies of the bill of 
lading (or other shipping document) for use by the District Director of 
Customs at the port of entry.
    (i) The Contractor shall provide written notice to the cognizant 
contract administration office immediately after notification by the 
Contracting Officer that duty-free entry will be accorded foreign 
supplies or, for duty-free supplies identified in the Schedule, upon 
award by the Contractor to the overseas supplier. The notice shall 
identify the--
    (1) Foreign supplies;
    (2) Country of origin;
    (3) Contract number; and
    (4) Scheduled delivery date(s).
    (j) The Contractor shall include the substance of this clause in any 
subcontract if--
    (1) Supplies identified in the Schedule to be accorded duty-free 
entry will be imported into the customs territory of the United States; 
or
    (2) Other foreign supplies in excess of $10,000 may be imported into 
the customs territory of the United States.

                             (End of clause)

[64 FR 72436, Dec. 27, 1999]



Sec.  52.225-9  Buy American Act--Construction Materials.

    As prescribed in 25.1102(a), insert the following clause:

          Buy American Act--Construction Materials (June 2003)

    (a) Definitions. As used in this clause--
    Construction material means an article, material, or supply brought 
to the construction site by the Contractor or a subcontractor for 
incorporation into the building or work. The term also includes an item 
brought to the site preassembled from articles, materials, or supplies. 
However, emergency life safety systems, such as emergency lighting, fire 
alarm, and audio evacuation systems, that are discrete systems 
incorporated into a public building or work and that are produced as 
complete systems, are evaluated as a single and distinct construction 
material regardless of when or how the individual parts or components of 
those systems are delivered to the construction site. Materials 
purchased directly by the Government are supplies, not construction 
material.
    Cost of components means--
    (1) For components purchased by the Contractor, the acquisition 
cost, including transportation costs to the place of incorporation into 
the construction material (whether or not such costs are paid to a 
domestic firm), and any applicable duty (whether or not a duty-free 
entry certificate is issued); or
    (2) For components manufactured by the Contractor, all costs 
associated with the manufacture of the component, including 
transportation costs as described in paragraph (1) of this definition, 
plus allocable overhead costs, but excluding profit. Cost of components 
does not include any costs associated with the manufacture of the end 
product.
    Domestic construction material means--
    (1) An unmanufactured construction material mined or produced in the 
United States; or
    (2) A construction material manufactured in the United States, if 
the cost of its components mined, produced, or manufactured in the 
United States exceeds 50 percent of the cost of all its components. 
Components of foreign origin of the same class or kind for which 
nonavailability determinations have been made are treated as domestic.
    Foreign construction material means a construction material other 
than a domestic construction material.
    United States means the 50 States, the District of Columbia, and 
outlying areas.

[[Page 167]]

    (b) Domestic preference. (1) This clause implements the Buy American 
Act (41 U.S.C. 10a-10d) by providing a preference for domestic 
construction material. The Contractor shall use only domestic 
construction material in performing this contract, except as provided in 
paragraphs (b)(2) and (b)(3) of this clause.
    (2) This requirement does not apply to the construction material or 
components listed by the Government as follows: ------ [Contracting 
Officer to list applicable excepted materials or indicate ``none'']
    (3) The Contracting Officer may add other foreign construction 
material to the list in paragraph (b)(2) of this clause if the 
Government determines that--
    (i) The cost of domestic construction material would be 
unreasonable. The cost of a particular domestic construction material 
subject to the requirements of the Buy American Act is unreasonable when 
the cost of such material exceeds the cost of foreign material by more 
than 6 percent;
    (ii) The application of the restriction of the Buy American Act to a 
particular construction material would be impracticable or inconsistent 
with the public interest; or
    (iii) The construction material is not mined, produced, or 
manufactured in the United States in sufficient and reasonably available 
commercial quantities of a satisfactory quality.
    (c) Request for determination of inapplicability of the Buy American 
Act. (1)(i) Any Contractor request to use foreign construction material 
in accordance with paragraph (b)(3) of this clause shall include 
adequate information for Government evaluation of the request, 
including--
    (A) A description of the foreign and domestic construction 
materials;
    (B) Unit of measure;
    (C) Quantity;
    (D) Price;
    (E) Time of delivery or availability;
    (F) Location of the construction project;
    (G) Name and address of the proposed supplier; and
    (H) A detailed justification of the reason for use of foreign 
construction materials cited in accordance with paragraph (b)(3) of this 
clause.
    (ii) A request based on unreasonable cost shall include a reasonable 
survey of the market and a completed price comparison table in the 
format in paragraph (d) of this clause.
    (iii) The price of construction material shall include all delivery 
costs to the construction site and any applicable duty (whether or not a 
duty-free certificate may be issued).
    (iv) Any Contractor request for a determination submitted after 
contract award shall explain why the Contractor could not reasonably 
foresee the need for such determination and could not have requested the 
determination before contract award. If the Contractor does not submit a 
satisfactory explanation, the Contracting Officer need not make a 
determination.
    (2) If the Government determines after contract award that an 
exception to the Buy American Act applies and the Contracting Officer 
and the Contractor negotiate adequate consideration, the Contracting 
Officer will modify the contract to allow use of the foreign 
construction material. However, when the basis for the exception is the 
unreasonable price of a domestic construction material, adequate 
consideration is not less than the differential established in paragraph 
(b)(3)(i) of this clause.
    (3) Unless the Government determines that an exception to the Buy 
American Act applies, use of foreign construction material is 
noncompliant with the Buy American Act or Balance of Payments Program.
    (d) Data. To permit evaluation of requests under paragraph (c) of 
this clause based on unreasonable cost, the Contractor shall include the 
following information and any applicable supporting data based on the 
survey of suppliers:

                          Foreign and Domestic Construction Materials Price Comparison
----------------------------------------------------------------------------------------------------------------
       Construction material description           Unit of measure          Quantity         Price (dollars) \1\
----------------------------------------------------------------------------------------------------------------
Item 1
    Foreign construction material.............  ....................  ....................  ....................
    Domestic construction material............  ....................  ....................  ....................
Item 2
    Foreign construction material.............  ....................  ....................  ....................
    Domestic construction material............  ....................  ....................  ....................
----------------------------------------------------------------------------------------------------------------
Include all delivery costs to the construction site and any applicable duty (whether or not a duty-free entry
  certificate is issued).
List name, address, telephone number, and contact for suppliers surveyed. Attach copy of response; if oral,
  attach summary.
Include other applicable supporting information.


[[Page 168]]

                             (End of clause)

[64 FR 72437, Dec. 27, 1999; 65 FR 4633, Jan. 31, 2000; 66 FR 65350, 
Dec. 18, 2001; 67 FR 21537, Apr. 30, 2002; 68 FR 28086, May 22, 2003]



Sec.  52.225-10   Notice of Buy American Act Requirement-- Construction Materials..

    As prescribed in 25.1102(b)(1), insert the following provision:

  Notice of Buy American Act Requirement--Construction Materials (MAY 
                                  2002)

    (a) Definitions. Construction material, domestic construction 
material, and foreign construction material, as used in this provision, 
are defined in the clause of this solicitation entitled ``Buy American 
Act--Construction Materials'' (Federal Acquisition Regulation (FAR) 
clause 52.225-9).
    (b) Requests for determinations of inapplicability. An offeror 
requesting a determination regarding the inapplicability of the Buy 
American Act should submit the request to the Contracting Officer in 
time to allow a determination before submission of offers. The offeror 
shall include the information and applicable supporting data required by 
paragraphs (c) and (d) of the clause at FAR 52.225-9 in the request. If 
an offeror has not requested a determination regarding the 
inapplicability of the Buy American Act before submitting its offer, or 
has not received a response to a previous request, the offeror shall 
include the information and supporting data in the offer.
    (c) Evaluation of offers. (1) The Government will evaluate an offer 
requesting exception to the requirements of the Buy American Act, based 
on claimed unreasonable cost of domestic construction material, by 
adding to the offered price the appropriate percentage of the cost of 
such foreign construction material, as specified in paragraph (b)(3)(i) 
of the clause at FAR 52.225-9.
    (2) If evaluation results in a tie between an offeror that requested 
the substitution of foreign construction material based on unreasonable 
cost and an offeror that did not request an exception, the Contracting 
Officer will award to the offeror that did not request an exception 
based on unreasonable cost.
    (d) Alternate offers. (1) When an offer includes foreign 
construction material not listed by the Government in this solicitation 
in paragraph (b)(2) of the clause at FAR 52.225-9, the offeror also may 
submit an alternate offer based on use of equivalent domestic 
construction material.
    (2) If an alternate offer is submitted, the offeror shall submit a 
separate Standard Form 1442 for the alternate offer, and a separate 
price comparison table prepared in accordance with paragraphs (c) and 
(d) of the clause at FAR 52.225-9 for the offer that is based on the use 
of any foreign construction material for which the Government has not 
yet determined an exception applies.
    (3) If the Government determines that a particular exception 
requested in accordance with paragraph (c) of the clause at FAR 52.225-9 
does not apply, the Government will evaluate only those offers based on 
use of the equivalent domestic construction material, and the offeror 
shall be required to furnish such domestic construction material. An 
offer based on use of the foreign construction material for which an 
exception was requested--
    (i) Will be rejected as nonresponsive if this acquisition is 
conducted by sealed bidding; or
    (ii) May be accepted if revised during negotiations.

                           (End of provision)

    Alternate I (May 2002). As prescribed in 25.1102(b)(2), substitute 
the following paragraph (b) for paragraph (b) of the basic provision:

    (b) Requests for determinations of inapplicability. An offeror 
requesting a determination regarding the inapplicability of the Buy 
American Act shall submit the request with its offer, including the 
information and applicable supporting data required by paragraphs (c) 
and (d) of the clause at FAR 52.225-9.

[64 FR 72438, Dec. 27, 1999, as amended at 67 FR 21537, Apr. 30, 2002]



Sec.  52.225-11  Buy American Act--Construction Materials under Trade Agreements.

    As prescribed in 25.1102(c), insert the following clause:

 Buy American Act--Construction Materials Under Trade Agreements (June 
                                  2003)

    (a) Definitions. As used in this clause--
    Component means an article, material, or supply incorporated 
directly into a construction material.
    Construction material means an article, material, or supply brought 
to the construction site by the Contractor or subcontractor for 
incorporation into the building or work. The term also includes an item 
brought to the site preassembled from articles, materials, or supplies. 
However, emergency life safety systems, such as emergency lighting, fire 
alarm, and audio evacuation systems, that are discrete systems 
incorporated into a public building or work and that are produced as 
complete systems, are evaluated as a single and distinct construction 
material regardless of when or how the individual parts or

[[Page 169]]

components of those systems are delivered to the construction site. 
Materials purchased directly by the Government are supplies, not 
construction material.
    Cost of components means--
    (1) For components purchased by the Contractor, the acquisition 
cost, including transportation costs to the place of incorporation into 
the construction material (whether or not such costs are paid to a 
domestic firm), and any applicable duty (whether or not a duty-free 
entry certificate is issued); or
    (2) For components manufactured by the Contractor, all costs 
associated with the manufacture of the component, including 
transportation costs as described in paragraph (1) of this definition, 
plus allocable overhead costs, but excluding profit. Cost of components 
does not include any costs associated with the manufacture of the end 
product.
    Designated country means any of the following countries: Aruba, 
Austria, Bangladesh, Belgium, Benin, Bhutan, Botswana, Burkina Faso, 
Burundi, Canada, Cape Verde, Central African Republic, Chad, Comoros, 
Denmark.
    Djibouti, Equatorial Guinea, Finland, France, Gambia, Germany, 
Greece, Guinea, Guinea-Bissau, Haiti, Hong Kong, Iceland, Ireland, 
Israel, Italy, Japan.
    Kiribati, Korea, Republic of, Lesotho, Liechtenstein, Luxembourg, 
Malawi, Maldives, Mali, Mozambique, Nepal, Netherlands, Niger, Norway, 
Portugal, Rwanda.
    Sao Tome and Principe, Sierra Leone, Singapore, Somalia, Spain, 
Sweden, Switzerland, Tanzania U.R., Togo, Tuvalu, Uganda, United 
Kingdom, Vanuatu, Western Samoa, Yemen.
    Designated country construction material means a construction 
material that--
    (1) Is wholly the growth, product, or manufacture of a designated 
country; or
    (2) In the case of a construction material that consists in whole or 
in part of materials from another country, has been substantially 
transformed in a designated country into a new and different 
construction material distinct from the materials from which it was 
transformed.
    Domestic construction material means--
    (1) An unmanufactured construction material mined or produced in the 
United States; or
    (2) A construction material manufactured in the United States, if 
the cost of its components mined, produced, or manufactured in the 
United States exceeds 50 percent of the cost of all its components. 
Components of foreign origin of the same class or kind for which 
nonavailability determinations have been made are treated as domestic.
    Foreign construction material means a construction material other 
than a domestic construction material.
    North American Free Trade Agreement country means Canada or Mexico.
    North American Free Trade Agreement country construction material 
means a construction material that--
    (1) Is wholly the growth, product, or manufacture of a North 
American Free Trade Agreement (NAFTA) country; or
    (2) In the case of a construction material that consists in whole or 
in part of materials from another country, has been substantially 
transformed in a NAFTA country into a new and different construction 
material distinct from the materials from which it was transformed.
    United States means the 50 States, the District of Columbia, and 
outlying areas.
    (b) Construction materials. (1) This clause implements the Buy 
American Act (41 U.S.C. 10a-10d) by providing a preference for domestic 
construction material. In addition, the Contracting Officer has 
determined that the Trade Agreements Act and the North American Free 
Trade Agreement (NAFTA) apply to this acquisition. Therefore, the Buy 
American Act restrictions are waived for designated country and NAFTA 
country construction materials.
    (2) The Contractor shall use only domestic, designated country, or 
NAFTA country construction material in performing this contract, except 
as provided in paragraphs (b)(3) and (b)(4) of this clause.
    (3) The requirement in paragraph (b)(2) of this clause does not 
apply to the construction materials or components listed by the 
Government as follows:------ [Contracting Officer to list applicable 
excepted materials or indicate ``none'']
    (4) The Contracting Officer may add other foreign construction 
material to the list in paragraph (b)(3) of this clause if the 
Government determines that--
    (i) The cost of domestic construction material would be 
unreasonable. The cost of a particular domestic construction material 
subject to the restrictions of the Buy American Act is unreasonable when 
the cost of such material exceeds the cost of foreign material by more 
than 6 percent;
    (ii) The application of the restriction of the Buy American Act to a 
particular construction material would be impracticable or inconsistent 
with the public interest; or
    (iii) The construction material is not mined, produced, or 
manufactured in the United States in sufficient and reasonably available 
commercial quantities of a satisfactory quality.
    (c) Request for determination of inapplicability of the Buy American 
Act. (1)(i) Any Contractor request to use foreign construction material 
in accordance with paragraph (b)(4) of this clause shall include 
adequate information for Government evaluation of the request, 
including--

[[Page 170]]

    (A) A description of the foreign and domestic construction 
materials;
    (B) Unit of measure;
    (C) Quantity;
    (D) Price;
    (E) Time of delivery or availability;
    (F) Location of the construction project;
    (G) Name and address of the proposed supplier; and
    (H) A detailed justification of the reason for use of foreign 
construction materials cited in accordance with paragraph (b)(3) of this 
clause.
    (ii) A request based on unreasonable cost shall include a reasonable 
survey of the market and a completed price comparison table in the 
format in paragraph (d) of this clause.
    (iii) The price of construction material shall include all delivery 
costs to the construction site and any applicable duty (whether or not a 
duty-free certificate may be issued).
    (iv) Any Contractor request for a determination submitted after 
contract award shall explain why the Contractor could not reasonably 
foresee the need for such determination and could not have requested the 
determination before contract award. If the Contractor does not submit a 
satisfactory explanation, the Contracting Officer need not make a 
determination.
    (2) If the Government determines after contract award that an 
exception to the Buy American Act applies and the Contracting Officer 
and the Contractor negotiate adequate consideration, the Contracting 
Officer will modify the contract to allow use of the foreign 
construction material. However, when the basis for the exception is the 
unreasonable price of a domestic construction material, adequate 
consideration is not less than the differential established in paragraph 
(b)(4)(i) of this clause.
    (3) Unless the Government determines that an exception to the Buy 
American Act applies, use of foreign construction material is 
noncompliant with the Buy American Act.
    (d) Data. To permit evaluation of requests under paragraph (c) of 
this clause based on unreasonable cost, the Contractor shall include the 
following information and any applicable supporting data based on the 
survey of suppliers:

                          Foreign and Domestic Construction Materials Price Comparison
----------------------------------------------------------------------------------------------------------------
       Construction material description           Unit of measure          Quantity         Price (dollars) \1\
----------------------------------------------------------------------------------------------------------------
Item 1:
    Foreign construction material.............  ....................  ....................  ....................
    Domestic construction material............  ....................  ....................  ....................
Item 2:
    Foreign construction material.............  ....................  ....................  ....................
    Domestic construction material............  ....................  ....................  ....................
----------------------------------------------------------------------------------------------------------------
\1\ Include all delivery costs to the construction site and any applicable duty (whether or not a duty-free
  entry certificate is issued).
List name, address, telephone number, and contact for suppliers surveyed. Attach copy of response; if oral,
  attach summary.
Include other applicable supporting information.

                             (End of clause)

    Alternate I (June 2000). As prescribed in 25.1102(c)(3), delete the 
definitions of ``North American Free Trade Agreement country'' and 
``North American Free Trade Agreement country construction material'' 
from the definitions in paragraph (a) of the basic clause and substitute 
the following paragraphs (b)(1) and (b)(2) for paragraphs (b)(1) and 
(b)(2) of the basic clause:

    (b) Construction materials. (1) This clause implements the Buy 
American Act (41 U.S.C. 10a-10d) by providing a preference for domestic 
construction material. In addition, the Contracting Officer has 
determined that the Trade Agreements Act applies to this acquisition. 
Therefore, the Buy American Act restrictions are waived for designated 
country construction materials.
    (2) The Contractor shall use only domestic or designated country 
construction material in performing this contract, except as provided in 
paragraphs (b)(3) and (b)(4) of this clause.

[64 FR 72438, Dec. 27, 1999; 65 FR 4633, Jan. 31, 2000, as amended at 65 
FR 36026, June 6, 2000; 66 FR 65351, 65371, Dec. 18, 2001; 67 FR 21537, 
Apr. 30, 2002; 67 FR 43520, June 27, 2002; 68 FR 28086, May 22, 2003]



Sec.  52.225-12  Notice of Buy American Act Requirement-- Construction 
Materials under Trade Agreements.

    As prescribed in 25.1102(d)(1), insert the following provision:

  Notice of Buy American Act Requirement--Construction Materials Under 
                       Trade Agreements (MAY 2002)

    (a) Definitions. Construction material, designated country 
construction material, domestic

[[Page 171]]

construction material, foreign construction material, and NAFTA country 
construction material, as used in this provision, are defined in the 
clause of this solicitation entitled ``Buy American Act--Construction 
Materials under Trade Agreements'' (Federal Acquisition Regulation (FAR) 
clause 52.225-11).
    (b) Requests for determination of inapplicability. An offeror 
requesting a determination regarding the inapplicability of the Buy 
American Act should submit the request to the Contracting Officer in 
time to allow a determination before submission of offers. The offeror 
shall include the information and applicable supporting data required by 
paragraphs (c) and (d) of FAR clause 52.225-11 in the request. If an 
offeror has not requested a determination regarding the inapplicability 
of the Buy American Act before submitting its offer, or has not received 
a response to a previous request, the offeror shall include the 
information and supporting data in the offer.
    (c) Evaluation of offers. (1) The Government will evaluate an offer 
requesting exception to the requirements of the Buy American Act, based 
on claimed unreasonable cost of domestic construction materials, by 
adding to the offered price the appropriate percentage of the cost of 
such foreign construction material, as specified in paragraph (b)(4)(i) 
of FAR clause 52.225-11.
    (2) If evaluation results in a tie between an offeror that requested 
the substitution of foreign construction material based on unreasonable 
cost and an offeror that did not request an exception, the Contracting 
Officer will award to the offeror that did not request an exception 
based on unreasonable cost.
    (d) Alternate offers. (1) When an offer includes foreign 
construction material, other than designated country or NAFTA country 
construction material, that is not listed by the Government in this 
solicitation in paragraph (b)(3) of FAR clause 52.225-11, the offeror 
also may submit an alternate offer based on use of equivalent domestic, 
designated country, or NAFTA country construction material.
    (2) If an alternate offer is submitted, the offeror shall submit a 
separate Standard Form 1442 for the alternate offer, and a separate 
price comparison table prepared in accordance with paragraphs (c) and 
(d) of FAR clause 52.225-11 for the offer that is based on the use of 
any foreign construction material for which the Government has not yet 
determined an exception applies.
    (3) If the Government determines that a particular exception 
requested in accordance with paragraph (c) of FAR clause 52.225-11 does 
not apply, the Government will evaluate only those offers based on use 
of the equivalent domestic, designated country, or NAFTA country 
construction material, and the offeror shall be required to furnish such 
domestic, designated country, or NAFTA country construction material. An 
offer based on use of the foreign construction material for which an 
exception was requested--
    (i) Will be rejected as nonresponsive if this acquisition is 
conducted by sealed bidding; or
    (ii) May be accepted if revised during negotiations.

                           (End of provision)

    Alternate I (May 2002). As prescribed in 25.1102(d)(2), substitute 
the following paragraph (b) for paragraph (b) of the basic provision:

    (b) Requests for determination of inapplicability. An offeror 
requesting a determination regarding the inapplicability of the Buy 
American Act shall submit the request with its offer, including the 
information and applicable supporting data required by paragraphs (c) 
and (d) of FAR clause 52.225-11.

    Alternate II (May 2002). As prescribed in 25.1102(d)(3), substitute 
the following paragraphs (a) and (d) for paragraphs (a) and (d) of the 
basic provision:

    (a) Definitions. ``Construction material,'' ``designated country 
construction material,'' ``domestic construction material,'' and 
``foreign construction material,'' as used in this provision, are 
defined in the clause of this solicitation entitled ``Buy American Act-- 
Construction Materials under Trade Agreements'' (Federal Acquisition 
Regulation (FAR) clause 52.225-11).
    (d) Alternate offers. (1) When an offer includes foreign 
construction material, other than designated country construction 
material, that is not listed by the Government in this solicitation in 
paragraph (b)(3) of FAR clause 52.225-11, the offeror also may submit an 
alternate offer based on use of equivalent domestic or designated 
country construction material.
    (2) If an alternate offer is submitted, the offeror shall submit a 
separate Standard Form 1442 for the alternate offer, and a separate 
price comparison table prepared in accordance with paragraphs (c) and 
(d) of FAR clause 52.225-11 for the offer that is based on the use of 
any foreign construction material for which the Government has not yet 
determined an exception applies.
    (3) If the Government determines that a particular exception 
requested in accordance with paragraph (c) of FAR clause 52.225-11 does 
not apply, the Government will evaluate only those offers based on use 
of the equivalent domestic or designated country construction material, 
and the offeror shall be required to furnish such domestic or designated 
country construction material. An offer based on use of the foreign 
construction

[[Page 172]]

material for which an exception was requested--
    (i) Will be rejected as nonresponsive if this acquisition is 
conducted by sealed bidding; or
    (ii) May be accepted if revised during negotiations.

[64 FR 72440, Dec. 27, 1999, as amended at 65 FR 36027, June 6, 2000; 67 
FR 21537, Apr. 30, 2002]



Sec.  52.225-13  Restrictions on Certain Foreign Purchases.

    As prescribed in 25.1103(a), insert the following clause:

          Restrictions on Certain Foreign Purchases (June 2003)

    (a) The Contractor shall not acquire, for use in the performance of 
this contract, any supplies or services originating from sources within, 
or that were located in or transported from or through, countries whose 
products are banned from importation into the United States and its 
outlying areas under regulations of the Office of Foreign Assets 
Control, Department of the Treasury. Those countries are Cuba, Iran, 
Iraq, Libya, North Korea, Sudan, the territory of Afghanistan controlled 
by the Taliban, and Serbia (excluding the territory of Kosovo).
    (b) The Contractor shall not acquire for use in the performance of 
this contract any supplies or services from entities controlled by the 
government of Iraq.
    (c) The Contractor shall insert this clause, including this 
paragraph (c), in all subcontracts.

                             (End of clause)

[64 FR 72440, Dec. 27, 1999, as amended at 65 FR 36028, June 6, 2000; 68 
FR 28086, May 22, 2003]

    Effective Date Note: At 68 FR 56686, Oct. 1, 2003, Sec.  52.225-13 
was amended by revising the date of the clause and paragraphs (a) and 
(b), effective Oct. 31, 2003. For the convenience of the user, the 
revised text is set forth below:

Sec.  52.225-13  Restrictions on Certain Foreign Purchases.

                                * * * * *

          Restrictions on Certain Foreign Purchases (Oct. 2003)

    (a) Except as authorized by the Office of Foreign Assets Control 
(OFAC) in the Department of the Treasury, the Contractor shall not 
acquire, for use in the performance of this contract, any supplies or 
services if any proclamation, Executive order, or statute administered 
by OFAC, or if OFAC's implementing regulations at 31 CFR chapter V, 
would prohibit such a transaction by a person subject to the 
jurisdiction of the United States.
    (b) Except as authorized by OFAC, most transactions involving Cuba, 
Iran, Libya, and Sudan are prohibited, as are most imports from North 
Korea, into the United States or its outlying areas. Lists of entities 
and individuals subject to economic sanctions are included in OFAC's 
List of Specially Designated Nationals and Blocked Persons at http://
www.epls.gov/Terlist1.html. More information about these restrictions, 
as well as updates, is available in the OFAC's regulations at 31 CFR 
chapter V and/or on OFAC's Web site at http://www.treas.gov/ofac.

                                * * * * *



Sec.  52.225-14  Inconsistency between English Version and Translation of Contract.

    As prescribed in 25.1103(b), insert the following clause:

 Inconsistency Between English Version and Translation of Contract (FEB 
                                  2000)

    In the event of inconsistency between any terms of this contract and 
any translation into another language, the English language meaning 
shall control.

                             (End of clause)

[64 FR 72440, Dec. 27, 1999]



Sec.  52.225-15  Sanctioned European Union Country End Products.

    As prescribed in 25.1103(c), insert the following clause:

        Sanctioned European Union Country End Products (FEB 2000)

    (a) Definitions. As used in this clause--
    Sanctioned European Union country end product means an article 
that--
    (1) Is wholly the growth, product, or manufacture of a sanctioned 
European Union (EU) member state; or
    (2) In the case of an article that consists in whole or in part of 
materials from another country, has been substantially transformed in a 
sanctioned EU member state into a new and different article of commerce 
with a name, character, or use distinct from that of the article or 
articles from which it was transformed. The term refers to a product 
offered for purchase under a supply contract, but for purposes of 
calculating the value of the end product includes services (except

[[Page 173]]

transportation services) incidental to the article, provided that the 
value of those incidental services does not exceed that of the article 
itself.
    Sanctioned European Union member state means Austria, Belgium, 
Denmark, Finland, France, Ireland, Italy, Luxembourg, the Netherlands, 
Sweden, or the United Kingdom.
    (b) The Contractor shall not deliver any sanctioned European Union 
country end products under this contract.

                             (End of clause)

[64 FR 72440, Dec. 27, 1999]



Sec.  52.225-16  Sanctioned European Union Country Services.

    As prescribed in 25.1103(c), insert the following clause:

          Sanctioned European Union Country Services (FEB 2000)

    (a) Definition. Sanctioned European Union member state, as used in 
this clause, means Austria, Belgium, Denmark, Finland, France, Ireland, 
Italy, Luxembourg, the Netherlands, Sweden, or the United Kingdom.
    (b) The Contractor shall not perform services under this contract in 
a sanctioned European Union member state. This prohibition does not 
apply to subcontracts.

                             (End of clause)

[64 FR 72441, Dec. 27, 1999]



Sec.  52.225-17  Evaluation of Foreign Currency Offers.

    As prescribed in 25.1103(d), insert the following provision:

            Evaluation of Foreign Currency Offers (FEB 2000)

    If the Government receives offers in more than one currency, the 
Government will evaluate offers by converting the foreign currency to 
United States currency using [Contracting Officer to insert source of 
rate] in effect as follows:
    (a) For acquisitions conducted using sealed bidding procedures, on 
the date of bid opening.
    (b) For acquisitions conducted using negotiation procedures--
    (1) On the date specified for receipt of offers, if award is based 
on initial offers; otherwise
    (2) On the date specified for receipt of proposal revisions.

                           (End of provision)

[64 FR 72441, Dec. 27, 1999]



Sec.  52.226  [Reserved]



Sec.  52.226-1  Utilization of Indian Organizations and Indian-Owned Economic 
Enterprises.

    As prescribed in 26.104, insert the following clause:

     Utilization of Indian Organizations and Indian-Owned Economic 
                         Enterprises (JUN 2000)

    (a) Definitions. As used in this clause:
    Indian means any person who is a member of any Indian tribe, band, 
group, pueblo or community that is recognized by the Federal Government 
as eligible for services from the Bureau of Indian Affairs (BIA) in 
accordance with 25 U.S.C. 1452(c) and any ``Native'' as defined in the 
Alaska Native Claims Settlement Act (43 U.S.C. 1601).
    Indian organization means the governing body of any Indian tribe or 
entity established or recognized by the governing body of an Indian 
tribe for the purposes of 25 U.S.C., chapter 17.
    Indian-owned economic enterprise means any Indian-owned (as 
determined by the Secretary of the Interior) commercial, industrial, or 
business activity established or organized for the purpose of profit, 
provided that Indian ownership constitutes not less than 51 percent of 
the enterprise.
    Indian tribe means any Indian tribe, band, group, pueblo or 
community, including native villages and native groups (including 
corporations organized by Kenai, Juneau, Sitka, and Kodiak) as defined 
in the Alaska Native Claims Settlement Act, that is recognized by the 
Federal Government as eligible for services from BIA in accordance with 
25 U.S.C. 1542(c).
    Interested party means a prime contractor or an actual or 
prospective offeror whose direct economic interest would be affected by 
the award of a subcontract or by the failure to award a subcontract.
    (b) The Contractor shall use its best efforts to give Indian 
organizations and Indian-owned economic enterprises (25 U.S.C. 1544) the 
maximum practicable opportunity to participate in the subcontracts it 
awards to the fullest extent consistent with efficient performance of 
its contract.
    (1) The Contracting Officer and the Contractor, acting in good 
faith, may rely on the representation of an Indian organization or 
Indian-owned economic enterprise as to its eligibility, unless an 
interested party challenges its status or the Contracting Officer

[[Page 174]]

has independent reason to question that status. In the event of a 
challenge to the representation of a subcontractor, the Contracting 
Officer will refer the matter to the U.S. Department of the Interior, 
Bureau of Indian Affairs (BIA), Attn: Chief, Division of Contracting and 
Grants Administration, 1849 C Street, NW., MS 2626-MIB, Washington, DC 
20240-4000.
    The BIA will determine the eligibility and notify the Contracting 
Officer. No incentive payment will be made within 50 working days of 
subcontract award or while a challenge is pending. If a subcontractor is 
determined to be an ineligible participant, no incentive payment will be 
made under the Indian Incentive Program.
    (2) The Contractor may request an adjustment under the Indian 
Incentive Program to the following:
    (i) The estimated cost of a cost-type contract.
    (ii) The target cost of a cost-plus-incentive-fee prime contract.
    (iii) The target cost and ceiling price of a fixed-price incentive 
prime contract.
    (iv) The price of a firm-fixed-price prime contract.
    (3) The amount of the adjustment to the prime contract is 5 percent 
of the estimated cost, target cost, or firm-fixed-price included in the 
subcontract initially awarded to the Indian organization or Indian-owned 
economic enterprise.
    (4) The Contractor has the burden of proving the amount claimed and 
must assert its request for an adjustment prior to completion of 
contract performance.
    (c) The Contracting Officer, subject to the terms and conditions of 
the contract and the availability of funds, will authorize an incentive 
payment of 5 percent of the amount paid to the subcontractor. The 
Contracting Officer will seek funding in accordance with agency 
procedures.

                             (End of clause)

[56 FR 41737, Aug. 22, 1991, as amended at 61 FR 39211, July 26, 1996; 
63 FR 70277, Dec. 18, 1998; 64 FR 10533, Mar. 4, 1999; 64 FR 72449, Dec. 
27, 1999; 65 FR 24323, Apr. 25, 2000]



Sec.  52.226-2  Historically Black College or University and Minority Institution 
Representation.

    As prescribed in 26.304, insert the following provision:

   Historically Black College or University and Minority Institution 
                        Representation (MAY 2001)

    (a) Definitions. As used in this provision--
    Historically black college or university means an institution 
determined by the Secretary of Education to meet the requirements of 34 
CFR 608.2. For the Department of Defense, the National Aeronautics and 
Space Administration, and the Coast Guard, the term also includes any 
nonprofit research institution that was an integral part of such a 
college or university before November 14, 1986.
    Minority institution means an institution of higher education 
meeting the requirements of Section 1046(3) of the Higher Education Act 
of 1965 (20 U.S.C. 1067k, including a Hispanic-serving institution of 
higher education, as defined in Section 316(b)(1) of the Act (20 U.S.C. 
1101a)).
    (b) Representation. The offeror represents that it--
    [ ] is [ ] is not a historically black college or university;
    [ ] is [ ] is not a minority institution.

                           (End of provision)



Sec.  52.227-1  Authorization and Consent.

    As prescribed at 27.201-2(a), insert the following clause:

                  Authorization and Consent (JUL 1995)

    (a) The Government authorizes and consents to all use and 
manufacture, in performing this contract or any subcontract at any tier, 
of any invention described in and covered by a United States patent (1) 
embodied in the structure or composition of any article the delivery of 
which is accepted by the Government under this contract or (2) used in 
machinery, tools, or methods whose use necessarily results from 
compliance by the Contractor or a subcontractor with (i) specifications 
or written provisions forming a part of this contract or (ii) specific 
written instructions given by the Contracting Officer directing the 
manner of performance. The entire liability to the Government for 
infringement of a patent of the United States shall be determined solely 
by the provisions of the indemnity clause, if any, included in this 
contract or any subcontract hereunder (including any lower-tier 
subcontract), and the Government assumes liability for all other 
infringement to the extent of the authorization and consent hereinabove 
granted.
    (b) The Contractor agrees to include, and require inclusion of, this 
clause, suitably modified to identify the parties, in all subcontracts 
at any tier for supplies or services (including construction, architect-
engineer services, and materials, supplies, models, samples, and design 
or testing services expected to exceed the simplified acquisition 
threshold (however, omission of this clause from any subcontract, 
including those at or below the simplified acquisition threshold, does 
not affect this authorization and consent.)

[[Page 175]]

                             (End of clause)

    Alternate I (APR 1984). The following is substituted for paragraph 
(a) of the clause:

    (a) The Government authorizes and consents to all use and 
manufacture of any invention described in and covered by a United States 
patent in the performance of this contract or any subcontract at any 
tier.

    Alternate II (APR 1984). The following is substituted for paragraph 
(a) of the clause:

    (a) The Government authorizes and consents to all use and 
manufacture in the performance of any order at any tier or subcontract 
at any tier placed under this contract for communication services and 
facilities for which rates, charges, and tariffs are not established by 
a government regulatory body, of any invention described in and covered 
by a United States patent (1) embodied in the structure or composition 
of any article the delivery of which is accepted by the Government under 
this contract or (2) used in machinery, tools, or methods whose use 
necessarily results from compliance by the contractor or a subcontractor 
with specifications or written provisions forming a part of this 
contract or with specific written instructions given by the Contracting 
Officer directing the manner of performance.

[49 FR 12986, Mar. 30, 1984, as amended at 60 FR 34761, July 3, 1995]



Sec.  52.227-2  Notice and Assistance Regarding Patent and Copyright Infringement.

    As prescribed at 27.202-2, insert the following clause:

 Notice and Assistance Regarding Patent and Copyright Infringement (AUG 
                                  1996)

    (a) The Contractor shall report to the Contracting Officer, promptly 
and in reasonable written detail, each notice or claim of patent or 
copyright infringement based on the performance of this contract of 
which the Contractor has knowledge.
    (b) In the event of any claim or suit against the Government on 
account of any alleged patent or copyright infringement arising out of 
the performance of this contract or out of the use of any supplies 
furnished or work or services performed under this contract, the 
Contractor shall furnish to the Government, when requested by the 
Contracting Officer, all evidence and information in possession of the 
Contractor pertaining to such suit or claim. Such evidence and 
information shall be furnished at the expense of the Government except 
where the Contractor has agreed to indemnify the Government.
    (c) The Contractor agrees to include, and require inclusion of, this 
clause in all subcontracts at any tier for supplies or services 
(including construction and architect-engineer subcontracts and those 
for material, supplies, models, samples, or design or testing services) 
expected to exceed the simplified acquisition threshold at FAR 2.101.

                             (End of clause)

[49 FR 12987, Mar. 30, 1984, as amended at 61 FR 39198, July 26, 1996]



Sec.  52.227-3  Patent Indemnity.

    Insert the following clause as prescribed at 27.203-1(b), 27.203-
2(a), or 27.203-4(a)(2) as applicable:

                       Patent Indemnity (APR 1984)

    (a) The Contractor shall indemnify the Government and its officers, 
agents, and employees against liability, including costs, for 
infringement of any United States patent (except a patent issued upon an 
application that is now or may hereafter be withheld from issue pursuant 
to a Secrecy Order under 35 U.S.C. 181) arising out of the manufacture 
or delivery of supplies, the performance of services, or the 
construction, alteration, modification, or repair of real property 
(hereinafter referred to as construction work) under this contract, or 
out of the use or disposal by or for the account of the Government of 
such supplies or construction work.
    (b) This indemnity shall not apply unless the Contractor shall have 
been informed as soon as practicable by the Government of the suit or 
action alleging such infringement and shall have been given such 
opportunity as is afforded by applicable laws, rules, or regulations to 
participate in its defense. Further, this indemnity shall not apply to 
(1) an infringement resulting from compliance with specific written 
instructions of the Contracting Officer directing a change in the 
supplies to be delivered or in the materials or equipment to be used, or 
directing a manner of performance of the contract not normally used by 
the Contractor, (2) an infringement resulting from addition to or change 
in supplies or components furnished or construction work performed that 
was made subsequent to delivery or performance, or (3) a claimed 
infringement that is unreasonably settled without the consent of the 
Contractor, unless required by final decree of a court of competent 
jurisdiction.

                             (End of clause)

    Alternate I (APR 1984). The following paragraph (c) is added to the 
clause:


[[Page 176]]


    (c) This patent indemnification shall not apply to the following 
items: ------ [Contracting Officer list and/or identify the items to be 
excluded from this indemnity]

    Alternate II (APR 1984). The following paragraph (c) is added to the 
clause:

    (c) This patent indemnification shall cover the following items: --
--------

     List or identify the items to be included under this indemnity

    Alternate III (JUL 1995). The following paragraph is added to the 
clause:

    ( ) As to subcontracts at any tier for communication service, this 
clause shall apply only to individual communication service 
authorizations over the simplified acquistion threshold issued under 
this contract and covering those communications services and facilities 
(1) that are or have been sold or offered for sale by the Contractor to 
the public, (2) that can be provided over commercially available 
equipment, or (3) that involve relatively minor modifications.

[49 FR 12987, Mar. 30, 1984, as amended at 56 FR 15156, Apr. 15, 1991; 
60 FR 34761, July 3, 1995]



Sec.  52.227-4  Patent Indemnity--Construction Contracts.

    As prescribed at 27.203-5, insert the following clause:

           Patent Indemnity--Construction Contracts (APR 1984)

    Except as otherwise provided, the Contractor agrees to indemnify the 
Government and its officers, agents, and employees against liability, 
including costs and expenses, for infringement upon any United States 
patent (except a patent issued upon an application that is now or may 
hereafter be withheld from issue pursuant to a Secrecy Order under 35 
U.S.C. 181) arising out of performing this contract or out of the use or 
disposal by or for the account of the Government of supplies furnished 
or work performed under this contract.

                             (End of clause)

    Alternate I (APR 1984) Designate the first paragraph as paragraph(a) 
and add the following to the basic clause as paragraph (b):

    (b) This patent indemnification shall not apply to the following 
items:
________________________________________________________________________
Contracting Officer specifically identify the item to be excluded
    Note: Exclusion from indemnity of specified, identified patents, as 
distinguished from items, is the exclusive prerogative of the agency 
head or designee (See 27.203-6).

[49 FR 12987, Mar. 30, 1984]



Sec.  52.227-5  Waiver of Indemnity.

    As prescribed at 27.203-6, insert the following clause:

                     Waiver of Indemnity (APR 1984)

    Any provision or clause of this contract to the contrary 
notwithstanding, the Government hereby authorizes and consents to the 
use and manufacture, solely in performing this contract, of any 
invention covered by the United States patents identified below and 
waives indemnification by the Contractor with respect to such patents:
________________________________________________________________________
Contracting Officer identify the patents by number or by other means if 
more appropriate

                             (End of clause)

[49 FR 12987, Mar. 30, 1984]



Sec.  52.227-6  Royalty Information.

    As prescribed at 27.204-2, insert the following provision:

                     Royalty Information (APR 1984)

    (a) Cost or charges for royalties. When the response to this 
solicitation contains costs or charges for royalties totaling more than 
$250, the following information shall be included in the response 
relating to each separate item of royalty or license fee:
    (1) Name and address of licensor.
    (2) Date of license agreement.
    (3) Patent numbers, patent application serial numbers, or other 
basis on which the royalty is payable.
    (4) Brief description, including any part or model numbers of each 
contract item or component on which the royalty is payable.
    (5) Percentage or dollar rate of royalty per unit.
    (6) Unit price of contract item.
    (7) Number of units.
    (8) Total dollar amount of royalties.
    (b) Copies of current licenses. In addition, if specifically 
requested by the Contracting Officer before execution of the contract, 
the offeror shall furnish a copy of the current license agreement and an 
identification of applicable claims of specific patents.

                           (End of provision)

    Alternate I. (APR 1984) Substitute the following for the 
introductory portion of paragraph (a) of the basic clause:


[[Page 177]]


    When the response to this solicitation covers charges for special 
construction or special assembly that contain costs or charges for 
royalties totaling more than $250, the following information shall be 
included in the response relating to each separate item of royalty or 
license fee:

[49 FR 12987, Mar. 30, 1984]



Sec.  52.227-7  Patents--Notice of Government Licensee.

    As prescribed at 27.204-3(c), insert the following provision:

            Patents--Notice of Government Licensee (APR 1984)

    The Government is obligated to pay a royalty applicable to the 
proposed acquisition because of a license agreement between the 
Government and the patent owner. The patent number is ---- [Contracting 
Officer fill in], and the royalty rate is ---- [Contracting Officer fill 
in]. If the offeror is the owner of, or a licensee under, the patent, 
indicate below:

                         ( ) Owner ( ) Licensee

    If an offeror does not indicate that it is the owner or a licensee 
of the patent, its offer will be evaluated by adding thereto an amount 
equal to the royalty.

                           (End of provision)

[49 FR 12988, Mar. 30, 1984]



Sec.  52.227-8  [Reserved]



Sec.  52.227-9  Refund of Royalties.

    As prescribed at 27.206-2, insert the following clause. In 
solicitations and contracts with an incentive fee arrangement, change 
price to target cost and target profit wherever it appears.

                     Refund of Royalties (APR 1984)

    (a) The contract price includes certain amounts for royalties 
payable by the Contractor or subcontractors or both, which amounts have 
been reported to the Contracting Officer.
    (b) The term royalties as used in this clause refers to any costs or 
charges in the nature of royalties, license fees, patent or license 
amortization costs, or the like, for the use of or for rights in patents 
and patent applications in connection with performing this contract or 
any subcontract hereunder.
    (c) The Contractor shall furnish to the Contracting Officer, before 
final payment under this contract, a statement of royalties paid or 
required to be paid in connection with performing this contract and 
subcontracts hereunder together with the reasons.
    (d) The Contractor will be compensated for royalties reported under 
paragraph (c) above, only to the extent that such royalties were 
included in the contract price and are determined by the Contracting 
Officer to be properly chargeable to the Government and allocable to the 
contract. To the extent that any royalties that are included in the 
contract price are not in fact paid by the Contractor or are determined 
by the Contracting Officer not to be properly chargeable to the 
Government and allocable to the contract, the contract price shall be 
reduced. Repayment or credit to the Government shall be made as the 
Contracting Officer directs.
    (e) If, at any time within 3 years after final payment under this 
contract, the Contractor for any reason is relieved in whole or in part 
from the payment of the royalties included in the final contract price 
as adjusted pursuant to paragraph (d) above, the Contractor shall 
promptly notify the Contracting Officer of that fact and shall reimburse 
the Government in a corresponding amount.
    (f) The substance of this clause, including this paragraph (f), 
shall be included in any subcontract in which the amount of royalties 
reported during negotiation of the subcontract exceeds $250.

                             (End of clause)

[49 FR 12988, Mar. 30, 1984]



Sec.  52.227-10  Filing of Patent Applications--Classified Subject Matter.

    As prescribed at 27.207-2, insert the following clause:

   Filing of Patent Applications--Classified Subject Matter (APR 1984)

    (a) Before filing or causing to be filed a patent application in the 
United States disclosing any subject matter of this contract classified 
Secret or higher, the Contractor shall, citing the 30-day provision 
below, transmit the proposed application to the Contracting Officer. The 
Government shall determine whether, for reasons of national security, 
the application should be placed under an order of secrecy, sealed in 
accordance with the provision of 35 U.S.C. 181-188, or the issuance of a 
patent otherwise delayed under pertinent United States statutes or 
regulations. The Contractor shall observe any instructions of the 
Contracting Officer regarding the manner of delivery of the patent 
application to the United States Patent Office, but the Contractor shall 
not be denied the right to file the application. If the Contracting 
Officer shall not have given any such instructions within 30 days from 
the date of mailing or other transmittal of the proposed application, 
the Contractor may file the application.

[[Page 178]]

    (b) Before filing a patent application in the United States 
disclosing any subject matter of this contract classified Confidential, 
the Contractor shall furnish to the Contracting Officer a copy of the 
application for Government determination whether, for reasons of 
national security, the application should be placed under an order of 
secrecy or the issuance of a patent should be otherwise delayed under 
pertinent United States statutes or regulations.
    (c) Where the subject matter of this contract is classified for 
reasons of security, the Contractor shall not file, or cause to be 
filed, in any country other than in the United States as provided in 
paragraphs (a) and (b) of this clause, an application or registration 
for a patent containing any of the subject matter of this contract 
without first obtaining written approval of the Contracting Officer.
    (d) When filing any patent application coming within the scope of 
this clause, the Contractor shall observe all applicable security 
regulations covering the transmission of classified subject matter and 
shall promptly furnish to the Contracting Officer the serial number, 
filing date, and name of the country of any such application. When 
transmitting the application to the United States Patent Office, the 
Contractor shall by separate letter identify by agency and number the 
contract or contracts that require security classification markings to 
be placed on the application.
    (e) The Contractor agrees to include, and require the inclusion of, 
this clause in all subcontracts at any tier that cover or are likely to 
cover classified subject matter.

                             (End of clause)

[49 FR 12988, Mar. 30, 1984]



Sec.  52.227-11  Patent Rights--Retention by the Contractor (Short Form).

    As prescribed in 27.303(a), insert the following clause:

    Patent Rights-Retention by the Contractor (Short Form) (JUN 1997)

    (a) Definitions.
    (1) Invention means any invention or discovery which is or may be 
patentable or otherwise protectable under title 35 of the United States 
Code, or any novel variety of plant which is or may be protected under 
the Plant Variety Protection Act (7 U.S.C. 2321, et seq.).
    (2) Made when used in relation to any invention means the conception 
or first actual reduction to practice of such invention.
    (3) Nonprofit organization means a university or other institution 
of higher education or an organization of the type described in section 
501(c)(3) of the Internal Revenue Code of 1954 (26 U.S.C. 501(c)) and 
exempt from taxation under section 501(a) of the Internal Revenue Code 
(26 U.S.C. 501(a)) or any nonprofit scientific or educational 
organization qualified under a state nonprofit organization statute.
    (4) Practical application means to manufacture, in the case of a 
composition of product; to practice, in the case of a process or method, 
or to operate, in the case of a machine or system; and, in each case, 
under such conditions as to establish that the invention is being 
utilized and that its benefits are, to the extent permitted by law or 
Government regulations, available to the public on reasonable terms.
    (5) Small business firm means a small business concern as defined at 
section 2 of Pub. L. 85-536 (15 U.S.C. 632) and implementing regulations 
of the Administrator of the Small Business Administration. For the 
purpose of this clause, the size standards for small business concerns 
involved in Government procurement and subcontracting at 13 CFR 121.3-8 
and 13 CFR 121.3-12, respectively, will be used.
    (6) Subject invention means any invention of the contractor 
conceived or first actually reduced to practice in the performance of 
work under this contract, provided that in the case of a variety of 
plant, the date of determination (as defined in section 41(d) of the 
Plant Variety Protection Act, 7 U.S.C. 2401(d)) must also occur during 
the period of contract performance.
    (b) Allocation of principal rights. The Contractor may retain the 
entire right, title, and interest throughout the world to each subject 
invention subject to the provisions of this clause and 35 U.S.C. 203. 
With respect to any subject invention in which the Contractor retains 
title, the Federal Government shall have a nonexclusive, 
nontransferable, irrevocable, paid-up license to practice or have 
practiced for or on behalf of the United States the subject invention 
throughout the world.
    (c) Invention disclosure, election of title, and filing of patent 
application by contractor. (1) The Contractor will disclose each subject 
invention to the Federal agency within 2 months after the inventor 
discloses it in writing to Contractor personnel responsible for patent 
matters. The disclosure to the agency shall be in the form of a written 
report and shall identify the contract under which the invention was 
made and the inventor(s). It shall be sufficiently complete in technical 
detail to convey a clear understanding to the extent known at the time 
of the disclosure, of the nature, purpose, operation, and the physical, 
chemical, biological or electrical characteristics of the invention. The 
disclosure shall also identify any publication, on sale or public use of 
the invention and whether a manuscript describing the invention has been 
submitted for publication

[[Page 179]]

and, if so, whether it has been accepted for publication at the time of 
disclosure. In addition, after disclosure to the agency, the contractor 
will promptly notify the agency of the acceptance of any manuscript 
describing the invention for publication or of any on sale or public use 
planned by the Contractor.
    (2) The Contractor will elect in writing whether or not to retain 
title to any such invention by notifying the Federal agency within 2 
years of disclosure to the Federal agency. However, in any case where 
publication, on sale or public use has initiated the 1 year statutory 
period wherein valid patent protection can still be obtained in the 
United States, the period for election of title may be shortened by the 
agency to a date that is no more than 60 days prior to the end of the 
statutory period.
    (3) The Contractor will file its initial patent application on a 
subject invention to which it elects to retain title within 1 year after 
election of title, or, if earlier, prior to the end of any statutory 
period wherein valid patent protection can be obtained in the United 
States after a publication, on sale, or public use. The Contractor will 
file patent applications in additional countries or international patent 
offices within either 10 months of the corresponding initial patent 
application or 6 months from the date permission is granted by the 
Commissioner of Patents and Trademarks to file foreign patent 
applications where such filing has been prohibited by a Secrecy Order.
    (4) Requests for extension of the time for disclosure election, and 
filing under subparagraphs (c) (1), (2), and (3) of this clause may, at 
the discretion of the agency, be granted.
    (d) Conditions when the government may obtain title. The Contractor 
will convey to the Federal agency, upon written request, title to any 
subject invention--
    (1) If the Contractor fails to disclose or elect title to the 
subject invention within the times specified in paragraph (c) of this 
clause, or elects not to retain title; provided, that the agency may 
only request title within 60 days after learning of the failure of the 
Contractor to disclose or elect within the specified times.
    (2) In those countries in which the Contractor fails to file patent 
applications within the times specified in paragraph (c) of this clause; 
provided, however, that if the Contractor has filed a patent application 
in a country after the times specified in paragraph (c) of this clause, 
but prior to its receipt of the written request of the Federal agency, 
the Contractor shall continue to retain title in that country.
    (3) In any country in which the Contractor decided not to continue 
the prosecution of any application for, to pay the maintenance fees on, 
or defend in reexamination or opposition proceeding on, a patent on a 
subject invention.
    (e) Minimum rights to Contractor and protection of the Contractor 
right to file. (1) The Contractor will retain a nonexclusive royalty-
free license throughout the world in each subject invention to which the 
Government obtains title, except if the Contractor fails to disclose the 
invention within the times specified in paragraph (c) of this clause. 
The Contractor's license extends to its domestic subsidiary and 
affiliates, if any, within the corporate structure of which the 
Contractor is a party and includes the right to grant sublicenses of the 
same scope to the extent the Contractor was legally obligated to do so 
at the time the contract was awarded. The license is transferable only 
with the approval of the Federal Agency, except when transferred to the 
successor of that part of the Contractor's business to which the 
invention pertains.
    (2) The Contractor's domestic license may be revoked or modified by 
the funding Federal agency to the extent necessary to achieve 
expeditious practical application of subject invention pursuant to an 
application for an exclusive license submitted in accordance with 
applicable provisions at 37 CFR part 404 and agency licensing 
regulations (if any). This license will not be revoked in that field of 
use or the geographical areas in which the Contractor has achieved 
practical application and continues to make the benefits of the 
invention reasonably accessible to the public. The license in any 
foreign country may be revoked or modified at the discretion of the 
funding Federal agency to the extent the Contractor, its licensees, or 
the domestic subsidiaries or affiliates have failed to achieve practical 
application in that foreign country.
    (3) Before revocation or modification of the license, the funding 
Federal agency will furnish the Contractor a written notice of its 
intention to revoke or modify the license, and the Contractor will be 
allowed 30 days (or such other time as may be authorized by the funding 
Federal agency for good cause shown by the Contractor) after the notice 
to show cause why the license should not be revoked or modified. The 
Contractor has the right to appeal, in accordance with applicable 
regulations in 37 CFR part 404 and agency regulations, if any, 
concerning the licensing revocation of modification of the license.
    (f) Contractor action to protect the government's interest. (1) The 
Contractor agrees to execute or to have executed and promptly deliver to 
the Federal agency all instruments necessary to (i) establish or confirm 
the rights the government has throughout the world in those subject 
inventions to which the Contractor elects to retain title, and (ii) 
convey title to the Federal agency when requested under paragraph (d) of 
this

[[Page 180]]

clause and to enable the Government to obtain patent protection 
throughout the world in that subject invention.
    (2) The Contractor agrees to require, by written agreement, its 
employees, other than clerical and nontechnical employees, to disclose 
promptly in writing to personnel identified as responsible for the 
administration of patent matters and in a format suggested by the 
Contractor each subject invention made under contract in order that the 
Contractor can comply with the disclosure provisions of paragraph (c) of 
this clause, and to execute all papers necessary to file patent 
applications on subject inventions and to establish the Government's 
rights in the subject inventions. This disclosure format should require, 
as a minimum, the information required by subparagraph (c)(1) of this 
clause. The Contractor shall instruct such employees, through employee 
agreements or other suitable educational programs, on the importance of 
reporting inventions in sufficient time to permit the filing of patent 
applications prior to U.S. or foreign statutory bars.
    (3) The Contractor will notify the Federal agency of any decisions 
not to continue the prosecution of a patent application, pay maintenance 
fees, or defend in a reexamination or opposition proceeding on a patent, 
in any country, not less than 30 days before the expiration of the 
response period required by the relevant patent office.
    (4) The Contractor agrees to include, within the specification of 
any United States patent application and any patent issuing thereon 
covering a subject invention, the following statement, ``The invention 
was made with Government support under (identify the contract) awarded 
by (identify the Federal agency). The Government has certain rights in 
the invention.''
    (g) Subcontracts. (1) The Contractor will include this clause, 
suitably modified to identify the parties, in all subcontracts, 
regardless of tier, for experimental, developmental, or research work to 
be performed by a small business firm or domestic nonprofit 
organization. The subcontractor will retain all rights provided for the 
Contractor in this clause, and the Contractor will not, as part of the 
consideration for awarding the subcontract, obtain rights in the 
subcontractor's subject inventions.
    (2) The Contractor will include in all other subcontracts, 
regardless of tier, for experimental, developmental, or research work 
the patent rights clause required by subpart 27.3.
    (3) In the case of subcontracts, at any tier, the agency, 
subcontractor, and the Contractor agree that the mutual obligations of 
the parties created by this clause constitute a contract between the 
subcontractor and the Federal agency with respect to the matters covered 
by the clause; provided, however, that nothing in this paragraph is 
intended to confer any jurisdiction under the Contract Disputes Act in 
connection with proceedings under paragraph (j) of this clause.
    (h) Reporting on utilization of subject inventions. The Contractor 
agrees to submit, on request, periodic reports no more frequently than 
annually on the utilization of a subject invention or on efforts at 
obtaining such utilization that are being made by the Contractor or its 
licensees or assignees. Such reports shall include information regarding 
the status of development, date of first commercial sale or use, gross 
royalties received by the Contractor, and such other data and 
information as the agency may reasonably specify. The Contractor also 
agrees to provide additional reports as may be requested by the agency 
in connection with any march-in proceeding undertaken by the agency in 
accordance with paragraph (j) of this clause. As required by 35 U.S.C. 
202(c)(5), the agency agrees it will not disclose such information to 
persons outside the Government without permission of the Contractor.
    (i) Preference for United States industry. Notwithstanding any other 
provision of this clause, the Contractor agrees that neither it nor any 
assignee will grant to any person the exclusive right to use or sell any 
subject invention in the United States unless such person agrees that 
any product embodying the subject invention or produced through the use 
of the subject invention will be manufactured substantially in the 
United States. However, in individual cases, the requirement for such an 
agreement may be waived by the Federal agency upon a showing by the 
Contractor or its assignee that reasonable but unsuccessful efforts have 
been made to grant licenses on similar terms to potential licensees that 
would be likely to manufacture substantially in the United States or 
that under the circumstances domestic manufacture is not commercially 
feasible.
    (j) March-in rights. The Contractor agrees that, with respect to any 
subject invention in which it has acquired title, the Federal agency has 
the right in accordance with the procedures in 37 CFR 401.6 and any 
supplemental regulations of the agency to require the Contractor, an 
assignee or exclusive licensee of a subject invention to grant a 
nonexclusive, partially exclusive, or exclusive license in any field of 
use to a responsible applicant or applicants, upon terms that are 
reasonable under the circumstances, and if the Contractor, assignee, or 
exclusive licensee refuses such a request the Federal agency has the 
right to grant such a license itself if the Federal agency determines 
that--
    (1) Such action is necessary because the Contractor or assignee has 
not taken, or is not expected to take within a reasonable

[[Page 181]]

time, effective steps to achieve practical application of the subject 
invention in such field of use;
    (2) Such action is necessary to alleviate health or safety needs 
which are not reasonably satisfied by the Contractor, assignee, or their 
licensees;
    (3) Such action is necessary to meet requirements for public use 
specified by Federal regulations and such requirements are not 
reasonably satisifed by the Contractor, assignee, or licensees; or
    (4) Such action is necessary because the agreement required by 
paragraph (i) of this clause has not been obtained or waived or because 
a licensee of the exclusive right to use or sell any subject invention 
in the United States is in breach of such agreement.
    (k) Special provisions for contracts with nonprofit organizations. 
If the Contractor is a nonprofit organization, it agrees that--
    (1) Rights to a subject invention in the United States may not be 
assigned without the approval of the Federal agency, except where such 
assignment is made to an organization which has as one of its primary 
functions the management of inventions, provided that such assignee will 
be subject to the same provisions as the Contractor;
    (2) The Contractor will share royalties collected on a subject 
invention with the inventor, including Federal employee co-inventors 
(when the agency deems it appropriate) when the subject invention is 
assigned in accordance with 35 U.S.C. 202(e) and 37 CFR 401.10;
    (3) The balance of any royalties or income earned by the Contractor 
with respect to subject inventions, after payment of expenses (including 
payments to inventors) incidental to the administration of subject 
inventions will be utilized for the support of scientific research or 
education; and
    (4) It will make efforts that are reasonable under the circumstances 
to attract licensees of subject inventions that are small business 
firms, and that it will give a preference to a small business firm when 
licensing a subject invention if the Contractor determines that the 
small business firm has a plan or proposal for marketing the invention 
which, if executed, is equally as likely to bring the invention to 
practical application as any plans or proposals from applicants that are 
not small business firms; provided, that the Contractor is also 
satisfied that the small business firm has the capability and resources 
to carry out its plan or proposal. The decision whether to give a 
preference in any specific case will be at the discretion of the 
contractor. However, the Contractor agrees that the Secretary of 
Commerce may review the Contractor's licensing program and decisions 
regarding small business applicants, and the Contractor will negotiate 
changes to its licensing policies, procedures, or practices with the 
Secretary of Commerce when the Secretary's review discloses that the 
Contractor could take reasonable steps to more effectively implement the 
requirements of this subparagraph (k)(4).
    (l) Communications.
    (Complete according to agency instructions.)

                             (End of clause)

    Alternate I (JUN 1989). As prescribed in 27.303(a)(3), add the 
following sentence at the end of paragraph (b) of the basic clause:

    The license shall include the right of the Government to sublicense 
foreign governments, their nationals and international organizations 
pursuant to the following treaties or international agreements: -------- 
*
    [*Contracting Officer complete with the names of applicable existing 
treaties or international agreements. The above language is not intended 
to apply to treaties or agreements that are in effect on the date of the 
award but are not listed.]

    Alternate II (JUN 1989). As prescribed in 27.303(a)(3), add the 
following sentence at the end of paragraph (b) of the basic clause:

    The agency reserves the right to unilaterally amend this contract to 
identify specific treaties or international agreements entered into or 
to be entered into by the Government after the effective date of the 
contract and effectuate those license or other rights which are 
necessary for the Government to meet its obligations to foreign 
governments, their nationals and international organizations under such 
treaties or international agreements with respect to subject inventions 
made after the date of the amendment.

    Alternate III (JUN 1989). As prescribed in 27.303(a)(4), substitute 
the following in place of subparagraph (k)(3) of the basic clause:

    (3) After payment of patenting costs, licensing costs, payments to 
inventors, and other expenses incidental to the administration of 
subject inventions, the balance of any royalties or income earned and 
retained by the Contractor during any fiscal year on subject inventions 
under this or any successor contract containing the same requirement, up 
to any amount equal to 5 percent of the budget of the facility for that 
fiscal year, shall be used by the Contractor for the scientific 
research, development, and education consistent with the research and 
development mission and objectives of the facility, including activities 
that increase the licensing potential of other inventions of the 
facility. If the balance exceeds 5 percent, 75 percent of the excess 
above 5 percent shall be paid by the Contractor to the Treasury of

[[Page 182]]

the United States and the remaining 25 percent shall be used by the 
Contractor only for the same purposes as described above. To the extent 
it provides the most effective technology transfer, the licensing of 
subject inventions shall be administered by Contractor employees on 
location at the facility.

    Alternate IV (JUN 1989). As prescribed in 27.303(a)(5), include the 
following subparagraph in paragraph (f) of the basic clause:

    (5) The Contractor shall establish and maintain active and effective 
procedures to ensure that subject inventions are promptly identified and 
timely disclosed, and shall submit a description of the procedures to 
the Contracting Officer so that the Contracting Officer may evaluate and 
determine their effectiveness.

[54 FR 25069, June 12, 1989, as amended at 62 FR 40238, July 25, 1997]



Sec.  52.227-12  Patent Rights--Retention by the Contractor (Long Form.)

    As prescribed at 27.303(b), insert the following clause:

    Patent Rights--Retention by the Contractor (Long Form) (JAN 1997)

    (a) Definitions.
    Invention means any invention or discovery which is or may be 
patentable or otherwise protectable under title 35 of the United States 
Code or any novel variety of plant that is or may be protectable under 
the Plant Variety Protection Act (7 U.S.C. 2321 et seq.).
    Made when used in relation to any invention means the conception or 
first actual reduction to practice of such invention.
    Nonprofit organization means a domestic university or other 
institution of higher education or an organization of the type described 
in section 501(c)(3) of the Internal Revenue Code of 1954 (26 U.S.C. 
501(c)) and exempt from taxation under section 501(a) of the Internal 
Revenue Code (26 U.S.C. 501(a)) or any nonprofit scientific or 
educational organization qualified under a state nonprofit organization 
statute.
    Practical application means to manufacture in the case of a 
composition or product, to practice in the case of a process or method, 
or to operate in the case of a machine or system; and, in each case, 
under such conditions as to establish that the invention is being 
utilized and that its benefits are, to the extent permitted by law or 
Government regulations, available to the public on reasonable terms.
    Small business firm means a small business concern as defined at 
section 2 of Pub. L. 85-536 (15 U.S.C. 532) and implementing regulations 
of the Administrator of the Small Business Administration. For the 
purpose of this clause, the size standards for small business concerns 
involved in Government procurement and subcontracting at 13 CFR 121.3-8 
and 13 CFR 121.3-12, respectively, will be used.
    Subject invention means any invention of the Contractor conceived or 
first actually reduced to practice in the performance of work under this 
contract; provided, that in the case of a variety of plant, the date of 
determination (as defined in section 41(d) of the Plant Variety 
Protection Act, 7 U.S.C. 2401(d)) must also occur during the period of 
contract performance.
    (b) Allocation of principal rights. The Contractor may elect to 
retain the entire right, title, and interest throughout the world to 
each subject invention subject to the provisions of this clause and 35 
U.S.C. 203. With respect to any subject invention in which the 
Contractor elects to retain title, the Federal Government shall have a 
nonexclusive, nontransferable, irrevocable, paid-up license to practice 
or have practiced for or on behalf of the United States the subject 
invention throughout the world.
    (c) Invention disclosure, election of title, and filing of patent 
applications by Contractor. (1) The Contractor shall disclose each 
subject invention to the Contracting Officer within 2 months after the 
inventor discloses it in writing to Contractor personnel responsible for 
patent matters or within 6 months after the Contractor becomes aware 
that a subject invention has been made, whichever is earlier. The 
disclosure to the Contracting Officer shall be in the form of a written 
report and shall identify the contract under which the invention was 
made and the inventor(s). It shall be sufficiently complete in technical 
detail to convey a clear understanding, to the extent known at the time 
of the disclosure, of the nature, purpose, operation, and physical, 
chemical, biological, or electrical characteristics of the invention. 
The disclosure shall also identify any publication, on sale, or public 
use of the invention and whether a manuscript describing the invention 
has been submitted for publication and, if so, whether it has been 
accepted for publication at the time of disclosure. In addition, after 
disclosure to the Contracting Officer, the Contractor shall promptly 
notify the Contracting Officer of the acceptance of any manuscript 
describing the invention for publication or of any on sale or public use 
planned by the Contractor.
    (2) The Contractor shall elect in writing whether or not to retain 
title to any such invention by notifying the Federal agency at the time 
of disclosure or within 8 months of disclosure, as to those countries 
(including the United States) in which the Contractor will retain title; 
provided, that in any case where publication, on sale, or public use has 
initiated the 1-year statutory period wherein

[[Page 183]]

valid patent protection can still be obtained in the United States, the 
period of election of title may be shortened by the agency to a date 
that is no more than 60 days prior to the end of the statutory period.
    (3) The Contractor shall file its initial patent application on an 
elected invention within 1 year after election or, if earlier, prior to 
the end of any statutory period wherein valid patent protection can be 
obtained in the United States after a publication, on sale, or public 
use. The Contractor shall file patent applications in additional 
countries (including the European Patent Office and under the Patent 
Cooperation Treaty) within either 10 months of the corresponding initial 
patent application or 6 months from the date permission is granted by 
the Commissioner of Patents and Trademarks to file foreign patent 
applications where such filing has been prohibited by a Secrecy Order.
    (4) Requests for extension of the time for disclosure to the 
Contracting Officer, election, and filing may, at the discretion of the 
funding Federal agency, be granted, and will normally be granted unless 
the Contracting Officer has reason to believe that a particular 
extension would prejudice the Government's interest.
    (d) Conditions when the Government may obtain title. The Contractor 
shall convey to the Federal agency, upon written request, title to any 
subject invention--
    (1) If the Contractor elects not to retain title to a subject 
invention;
    (2) If the Contractor fails to disclose or elect the subject 
invention within the times specified in paragraph (c) above (the agency 
may only request title within 60 days after learning of the Contractor's 
failure to report or elect within the specified times);
    (3) In those countries in which the Contractor fails to file patent 
applications within the times specified in paragraph (c) above; 
provided, however, that if the Contractor has filed a patent application 
in a country after the times specified in paragraph (c) above, but prior 
to its receipt of the written request of the Federal agency, the 
Contractor shall continue to retain title in that country; or
    (4) In any country in which the Contractor decides not to continue 
the prosecution of any application for, to pay the maintenance fees on, 
or defend in reexamination or opposition proceeding on, a patent on a 
subject invention.
    (e) Minimum rights to Contractor. (1) The Contractor shall retain a 
nonexclusive, royalty-free license throughout the world in each subject 
invention to which the Government obtains title except if the Contractor 
fails to disclose the subject invention within the times specified in 
paragraph (c) above. The Contractor's license extends to its domestic 
subsidiaries and affiliates, if any, within the corporate structure of 
which the Contractor is a part and includes the right to grant 
sublicenses of the same scope to the extent the Contractor was legally 
obligated to do so at the time the contract was awarded. The license is 
transferable only with the approval of the funding Federal agency except 
when transferred to the successor of that part of the Contractor's 
business to which the invention pertains.
    (2) The Contractor's domestic license may be revoked or modified by 
the funding Federal agency to the extent necessary to achieve 
expeditious practical application of the subject invention pursuant to 
an application for an exclusive license submitted in accordance with 
applicable provisions in the Federal Property Management Regulations and 
agency licensing regulations (if any). This license shall not be revoked 
in that field of use or the geographical areas in which the Contractor 
has achieved practical application and continues to make the benefits of 
the invention reasonably accessible to the public. The license in any 
foreign country may be revoked or modified at the discretion of the 
funding Federal agency to the extent the Contractor, its licensees, or 
its domestic subsidiaries or affiliates have failed to achieve practical 
applciation in that foreign country.
    (3) Before revocation or modification of the license, the funding 
Federal agency shall furnish the Contractor a written notice of its 
intention to revoke or modify the license, and the Contractor shall be 
allowed 30 days (or such other time as may be authorized by the funding 
Federal agency for good cause shown by the Contractor) after the notice 
to show cause why the license should not be revoked or modified. The 
Contractor has the right to appeal, in accordance with applicable agency 
licensing regulations and 37 CFR 404 concerning the licensing of 
Government-owned inventions, any decision concerning the revocation or 
modification of its license.
    (f) Contractor action to protect the Government's interest. (1) The 
Contractor agrees to execute or to have executed and promptly deliver to 
the Federal agency all instruments necessary to (i) establish or confirm 
the rights the Government has throughout the world in those subject 
inventions to which the Contractor elects to retain title, and (ii) 
convey title to the Federal agency when requested under paragraph (d) 
above and subparagraph (n)(2) below, and to enable the Government to 
obtain patent protection throughout the world in that subject invention.
    (2) The Contractor agrees to require, by written agreement, its 
employees, other than clerical and nontechnical employees, to disclose 
promptly in writing to personnel identified as responsible for the 
administration of patent matters and in a format suggested by the 
Contractor each subject invention made under contract in order that the 
Contractor can comply with the disclosure

[[Page 184]]

provisions of paragraph (c) above, and to execute all papers necessary 
to file patent applications on subject inventions and to establish the 
Government's rights in the subject inventions. This disclosure format 
should require, as a minimum, the information required by subparagraph 
(c)(1) above. The Contractor shall instruct such employees through 
employee agreements or other suitable educational programs on the 
importance of reporting inventions in sufficient time to permit the 
filing of patent applications prior to U.S. or foreign statutory bars.
    (3) The Contractor shall notify the Federal agency of any decision 
not to continue the prosecution of a patent application, pay maintenance 
fees, or defend in a reexamination or opposition proceeding on a patent, 
in any country, not less than 30 days before the expiration of the 
response period required by the relevant patent office.
    (4) The Contractor agrees to include, within the specification of 
any United States patent application and any patent issuing thereon 
covering a subject invention, the following statement: ``This invention 
was made with Government support under (identify the contract) awarded 
by (identify the Federal agency). The Government has certain rights in 
this invention.''
    (5) The Contractor shall establish and maintain active and effective 
procedures to assure that subject inventions are promptly identified and 
disclosed to Contractor personnel responsible for patent matters within 
6 months of conception and/or first actual reduction to practice, 
whichever occurs first in performance of work under this contract. These 
procedures shall include the maintenance of laboratory notebooks or 
equivalent records and other records as are reasonably necessary to 
document the conception and/or the first actual reduction to practice of 
subject inventions, and records that show that the procedures for 
identifying and disclosing the inventions are followed. Upon request, 
the Contractor shall furnish the Contracting Officer a description of 
such procedures for evaluation and for determination as to their 
effectiveness.
    (6) The Contractor agrees, when licensing a subject invention, to 
arrange to avoid royalty charges on acquisitions involving Government 
funds, including funds derived through Military Assistance Program of 
the Government or otherwise derived through the Government, to refund 
any amounts received as royalty charges on the subject invention in 
acquisitions for, or on behalf of, the Government, and to provide for 
such refund in any instrument transferring rights in the invention to 
any party.
    (7) The Contractor shall furnish the Contracting Officer the 
following:
    (i) Interim reports every 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.
    (ii) A final report, within 3 months after completion of the 
contracted work, listing all subject inventions or stating that there 
were no such inventions, and listing all subcontracts at any tier 
containing a patent rights clause or stating that there were no such 
subcontracts.
    (8) The Contractor shall promptly notify the Contracting Officer in 
writing upon the award of any subcontract at any tier containing a 
patent rights clause by identifying the subcontractor, the applicable 
patent rights clause, the work to be performed under the subcontract, 
and the dates of award and estimated completion. Upon request of the 
Contracting Officer, the Contractor shall furnish a copy of such 
subcontract, and no more frequently than annually, a listing of the 
subcontracts that have been awarded.
    (9) In the event of a refusal by a prospective subcontractor to 
accept one of the clauses in subparagraph (g) (1) or (2) below, the 
Contractor (i) shall promptly submit a written notice to the Contracting 
Officer setting forth the subcontractor's reasons for such refusal and 
other pertinent information that may expedite disposition of the matter 
and (ii) shall not proceed with such subcontracting without the written 
authorization of the Contracting Officer.
    (10) The Contractor shall provide, upon request, the filing date, 
serial number and title, a copy of the patent application (including an 
English-language version if filed in a language other than English), and 
patent number and issue date for any subject invention for which the 
Contractor has retained title.
    (11) Upon request, the Contractor shall furnish the Government an 
irrevocable power to inspect and make copies of the patent application 
file.
    (g) Subcontracts. (1) The Contractor shall include the clause at 
52.227-11 of the Federal Acquisition Regulation (FAR), suitably modified 
to identify the parties, in all subcontracts, regardless of tier, for 
experimental, developmental, or research work to be performed by a small 
business firm or nonprofit organization. The subcontractor shall retain 
all rights provided for the Contractor in this clause, and the 
Contractor shall not, as part of the consideration for awarding the 
subcontract, obtain rights in the subcontractor's subject inventions.
    (2) The Contractor shall include this clause (FAR 52.227-12) in all 
other subcontracts, regardless of tier, for experimental, developmental, 
or research work.
    (3) In the case of subcontracts, at any tier, when the prime award 
with the Federal

[[Page 185]]

agency was a contract (but not a grant or cooperative agreement), the 
agency, subcontractor, and the Contractor agree that the mutual 
obligations of the parties created by this clause constitute a contract 
between the subcontractor and the Federal agency with respect to those 
matters covered by this clause.
    (h) Reporting utilization of subject inventions. The Contractor 
agrees to submit on request periodic reports no more frequently than 
annually on the utilization of a subject invention or on efforts at 
obtaining such utilization that are being made by the Contractor or its 
licensees or assignees. Such reports shall include information regarding 
the status of development, date of first commercial sale or use, gross 
royalties received by the Contractor, and such other data and 
information as the agency may reasonably specify. The Contractor also 
agrees to provide additional reports as may be requested by the agency 
in connection with any march-in proceedings undertaken by the agency in 
accordance with paragraph (j) of this clause. To the extent data or 
information supplied under this paragraph is considered by the 
Contractor, its licensee or assignee to be privileged and confidential 
and is so marked, the agency agrees that, to the extent permitted by 
law, it shall not disclose such information to persons outside the 
Government.
    (i) Preference for United States industry. Notwithstanding any other 
provision of this clause, the Contractor agrees that neither it nor any 
assignee will grant to any person the exclusive right to use or sell any 
subject invention in the United States unless such person agrees that 
any products embodying the subject invention will be manufactured 
substantially in the United States. However, in individual cases, the 
requirement for such an agreement may be waived by the Federal agency 
upon a showing by the Contractor or its assignee that reasonable but 
unsuccessful efforts have been made to grant licenses on similar terms 
to potential licensees that would be likely to manufacture substantially 
in the United States or that under the circumstances domestic 
manufacture is not commercially feasible.
    (j) March-in rights. The Contractor agrees that with respect to any 
subject invention in which it has acquired title, the Federal agency has 
the right in accordance with the procedures in FAR 27.304-1(g) to 
require the Contractor, an assignee, or exclusive licensee of a subject 
invention to grant a nonexclusive, partially exclusive, or exclusive 
license in any field of use to a responsible applicant or applicants, 
upon terms that are reasonable under the circumstances, and if the 
Contractor, assignee, or exclusive licensee refuses such a request, the 
Federal agency has the right to grant such a license itself if the 
Federal agency determines that--
    (1) Such action is necessary because the Contractor or assignee has 
not taken, or is not expected to take within a reasonable time, 
effective steps to achieve practical application of the subject 
invention in such field of use;
    (2) Such action is necessary to alleviate health or safety needs 
which are not reasonably satisfied by the Contractor, assignee, or their 
licensees;
    (3) Such action is necessary to meet requirements for public use 
specified by Federal regulations and such requirements are not 
reasonably satisfied by the Contractor, assignee, or licensees,; or
    (4) Such action is necessary because the agreement required by 
paragraph (i) of this clause has not been obtained or waived or because 
a licensee of the exclusive right to use or sell any subject invention 
in the United States is in breach of such agreement.
    (k) Special provisions for contracts with nonprofit organizations. 
[Reserved]
    (l) Communications. (Complete according to agency instructions.)
    (m) Other inventions. Nothing contained in this clause shall be 
deemed to grant to the Government any rights with respect to any 
invention other than a subject invention.
    (n) Examination of records relating to inventions. (1) The 
Contracting Officer or any authorized representative shall, until 3 
years after final payment under this contract, have the right to examine 
any books (including laboratory notebooks), records, and documents of 
the Contractor relating to the conception or first reduction to practice 
of inventions in the same field of technology as the work under this 
contract to determine whether--
    (i) Any such inventions are subject inventions;
    (ii) The Contractor has established and maintains the procedures 
required by subparagraphs (f)(2) and (f)(3) of this clause; and
    (iii) The Contractor and its inventors have complied with the 
procedures.
    (2) If the Contracting Officer determines that an inventor has not 
disclosed a subject invention to the Contractor in accordance with the 
procedures required by subparagraph (f)(5) of this clause, the 
Contracting Officer may, within 60 days after the determination, request 
title in accordance with subparagraphs (d)(2) and (d)(3) of this clause. 
However, if the Contractor establishes that the failure to disclose did 
not result from the Contractor's fault or negligence, the Contracting 
Officer shall not request title.
    (3) If the Contracting Officer learns of an unreported Contractor 
invention which the Contracting Officer believes may be a subject 
invention, the Contractor may be required to disclose the invention to 
the agency for a determination of ownership rights.

[[Page 186]]

    (4) Any examination of records under this paragraph shall be subject 
to appropriate conditions to protect the confidentiality of the 
information involved.
    (o) Withholding of payment (this paragraph does not apply to 
subcontracts). (1) Any time before final payment under this contract, 
the Contracting Officer may, in the Government's interest, withhold 
payment until a reserve not exceeding $50,000 or 5 percent of the amount 
of the contract, whichever is less, shall have been set aside if, in the 
Contracting Officer's opinion, the Contractor fails to--
    (i) Establish, maintain, and follow effective procedures for 
identifying and disclosing subject inventions pursuant to subparagraph 
(f)(5) above;
    (ii) Disclose any subject invention pursuant to subparagraph (c)(1) 
above;
    (iii) Deliver acceptable interim reports pursuant to subdivision 
(f)(7)(i) above; or
    (iv) Provide the information regarding subcontracts pursuant to 
subparagraph (f)(8) of this clause.
    (2) Such reserve or balance shall be withheld until the Contracting 
Officer has determined that the Contractor has rectified whatever 
deficiencies exist and has delivered all reports, disclosures, and other 
information required by this clause.
    (3) Final payment under this contract shall not be made before the 
Contractor delivers to the Contracting Officer all disclosures of 
subject inventions required by subparagraph (c)(1) above, an acceptable 
final report pursuant to subdivision (f)(7)(ii) above, and all past due 
confirmatory instruments.
    (4) The Contracting Officer may decrease or increase the sums 
withheld up to the maximum authorized above. No amount shall be withheld 
under this paragraph while the amount specified by this paragraph is 
being withheld under other provisions of the contract. The withholding 
of any amount or the subsequent payment thereof shall not be construed 
as a waiver of any Government right.

                             (End of clause)

    Alternate I (JUN 1989). As prescribed in 27.303(b)(2), add the 
following sentence at the end of paragraph (b) of the basic clause:

    The license shall include the right of the Government to sublicense 
foreign governments, their nationals, and international organizations 
pursuant to the following treaties or international agreements: ------*
    [*Contracting Officer complete with the names of applicable existing 
treaties or international agreements. The above language is not intended 
to apply to treaties or agreements that are in effect on the date of the 
award but are not listed.]

    Alternate II (JUNE 1989). As prescribed in 27.303(b)(2), add the 
following sentence at the end of paragraph (b) of the basic clause:

    The agency reserves the right to unilaterally amend this contract to 
identify specific treaties or international agreements entered into or 
to be entered into by the Government after the effective date of this 
contract and effectuate those license or other rights which are 
necessary for the Government to meet its obligations to foreign 
governments, their nationals, and international organizations under such 
treaties or international agreement with respect to subject inventions 
made after the date of the amendment.

[49 FR 12991, Mar. 30, 1984, as amended at 54 FR 25072, June 12, 1989; 
54 FR 49296, Nov. 30, 1989; 55 FR 38518, Sept. 18, 1990; 62 FR 239, Jan. 
2, 1997]



Sec.  52.227-13  Patent Rights--Acquisition by the Government.

    As prescribed at 27.303(c), insert the following clause:

         Patent Rights--Acquisition by the Government (JAN 1997)

    (a) Definitions.
    Invention, as used in this clause, means any invention or discovery 
which is or may be patentable or otherwise protectable under title 35 of 
the United States Code or any novel variety of plant that is or may be 
protectable under the Plant Variety Protection Act (7 U.S.C. 2321, et 
seq.).
    Subject invention, as used in this clause, means any invention of 
the Contractor conceived or first actually reduced to practice in the 
performance of work under this contract; provided, that in the case of a 
variety of plant, the date of determination (as defined in section 41(d) 
of the Plant Variety Protection Act, 7 U.S.C. 2401(d)) must also occur 
during the period of contract performance.

    Practical application, as used in this clause, means to manufacture, 
in the case of a composition or product; to practice, in the case of a 
process or method; or to operate, in the case of a machine or system; 
and, in each case, under such conditions as to establish that the 
invention is being utilized and that its benefits are, to the extent 
permitted by law or Government regulations, available to the public on 
reasonable terms.
    (b) Allocations of principal rights. (1) Assignment to the 
Government. The Contractor agrees to assign to the Government the entire 
right, title, and interest throughout the world in and to each subject 
invention, except to the extent that rights are retained by the 
Contractor under subparagraph (b)(2) and paragraph (d) below.

[[Page 187]]

    (2) Greater rights determinations (i) The Contractor, or an 
employee-inventor after consultation with the Contractor, may retain 
greater rights than the nonexclusive license provided in paragraph (d) 
below, in accordance with the procedures of paragraph 27.304-1(a) of the 
Federal Acquisition Regulation (FAR). A request for a determination of 
whether the Contractor or the employee-inventor is entitled to retain 
such greater rights must be submitted to the Head of the Contracting 
Agency or designee at the time of the first disclosure of the invention 
pursuant to subparagraph (e)(2) below, or not later than 8 months 
thereafter, unless a longer period is authorized in writing by the 
Contracting Officer for good cause shown in writing by the Contractor. 
Each determination of greater rights under this contract normally shall 
be subject to paragraph (c) below, and to the reservations and 
conditions deemed to be appropriate by the Head of the Contracting 
Agency or designee.
    (ii) Upon request, the Contractor shall provide the filing date, 
serial number and title, a copy of the patent application (including an 
English-language version if filed in a language other than English), and 
patent number and issue date for any subject invention in any country 
for which the Contractor has retained title.
    (iii) Upon request, the Contractor shall furnish the Government an 
irrevocable power to inspect and make copies of the patent application 
file.
    (c) Minimum rights acquired by the Government. (1) With respect to 
each subject invention to which the Contractor retains principal or 
exclusive rights, the Contractor agrees as follows:
    (i) The Contractor hereby grants to the Government a nonexclusive, 
nontransferable, irrevocable, paid-up license to practice or have 
practiced each subject invention throughout the world by or on behalf of 
the Government of the United States (including any Government agency).
    (ii) The Contractor agrees that with respect to any subject 
invention in which it has acquired title, the Federal agency has the 
right in accordance with the procedures in FAR 27.304-1(g) to require 
the Contractor, an assignee, or exclusive licensee of a subject 
invention to grant a nonexclusive, partially exclusive, or exclusive 
license in any field of use to a responsible applicant or applicants, 
upon terms that are reasonable under the circumstances, and if the 
Contractor, assignee, or exclusive licensee refuses such a request, the 
Federal agency has the right to grant such a license itself if the 
Federal agency determines that--
    (A) Such action is necessary because the Contractor or assignee has 
not taken, or is not expected to take within a reasonable time, 
effective steps to achieve practical application f the subject invention 
in such field of use;
    (B) Such action is necessary to alleviate health or safety needs 
which are not reasonably satisfied by the Contractor, assignee, or their 
licensees;
    (C) Such action is necessary to meet requirements for public use 
specified by Federal regulations and such requirements are not 
reasonably satisfied by the Contractor, assignee, or licensees; or
    (D) Such action is necessary because the agreement required by 
paragraph (i) of this clause has neither been obtained nor waived or 
because a licensee of the exclusive right to use or sell any subject 
invention in the United States is in breach of such agreement.
    (iii) The Contractor agrees to submit on request periodic reports no 
more frequently than annually on the utilization of a subject invention 
or on efforts at obtaining such utilization of a subject invention or on 
efforts at obtaining such utilization that are being made by the 
Contractor or its licensees or assignees. Such reports shall include 
information regarding the status of development, date of first 
commercial sale or use, gross royalties received by the Contractor, and 
such other data and information as the agency may reasonably specify. 
The Contractor also agrees to provide additional reports as may be 
requested by the agency in connection with any march-in proceedings 
undertaken by the agency in accordance with subdivision (ii) above. To 
the extent data or information supplied under this section is considered 
by the Contractor, its licensee, or assignee to be privileged and 
confidential and is so marked, the agency agrees that, to the extent 
permitted by law, it will not disclose such information to persons 
outside the Government.
    (iv) The Contractor agrees, when licensing a subject invention, to 
arrange to avoid royalty charges on acquisitions involving Government 
funds, including funds derived through a Military Assistance Program of 
the Government or otherwise derived through the Government, to refund 
any amounts received as royalty charges on a subject invention in 
acquisitions for, or on behalf of, the Government, and to provide for 
such refund in any instrument transferring rights in the invention to 
any party.
    (v) The Contractor agrees to provide for the Government's paid-up 
license pursuant to subdivision (i) above in any instrument transferring 
rights in a subject invention and to provide for the granting of 
licenses as required by subdivision (ii) above, and for the reporting of 
utilization information as required by subdivision (iii) above, whenever 
the instrument transfers principal or exclusive rights in a subject 
invention.
    (2) Nothing contained in this paragraph (c) shall be deemed to grant 
to the Government

[[Page 188]]

any rights with respect to any invention other than a subject invention.
    (d) Minimum rights to the Contractor. (1) The Contractor is hereby 
granted a revocable nonexclusive, royalty-free license in each patent 
application filed in any country on a subject invention and any 
resulting patent in which the Government obtains title, unless the 
Contractor fails to disclose the subject invention within the times 
specified in subparagraph (e)(2) below. The Contractor's license extends 
to its domestic subsidiaries and affiliates, if any, within the 
corporate structure of which the Contractor is a part and includes the 
right to grant sublicenses of the same scope to the extent the 
Contractor was legally obligated to do so at the time the contract was 
awarded. The license is transferable only with the approval of the 
funding Federal agency except when transferred to the successor of that 
part of the Contractor's business to which the invention pertains.
    (2) The Contractor's domestic license may be revoked or modified by 
the funding Federal agency to the extent necessary to achieve 
expeditious practical application of the subject invention pursuant to 
an application for an exclusive license submitted in accordance with 
applicable provisions in 37 CFR part 404 and agency licensing 
regulations. This license will not be revoked in that field of use or 
the geographical areas in which the Contractor has achieved practical 
application and continues to make the benefits of the invention 
reasonably accessible to the public. The license in any foreign country 
may be revoked or modified at the discretion of the funding Federal 
agency to the extent the Contractor, its licensees, or its domestic 
subsidiaries or affiliates have failed to achieve practical application 
in that foreign country.
    (3) Before revocation or modification of the license, the funding 
Federal agency will furnish the Contractor a written notice of its 
intention to revoke or modify the license, and the Contractor will be 
allowed 30 days (or such other time as may be authorized by the funding 
Federal agency for good cause shown by the Contractor) after the notice 
to show cause why the license should not be revoked or modified. The 
Contractor has the right to appeal, in accordance with applicable agency 
licensing regulations and 37 CFR part 404 concerning the licensing of 
Government-owned inventions, any decision concerning the revocation or 
modification of its license.
    (4) When the Government has the right to receive title, and does not 
elect to secure a patent in a foreign country, the Contractor may elect 
to retain such rights in any foreign country in which the Government 
elects not to secure a patent, subject to the Government's rights in 
subparagraph (c)(1) of this clause.
    (e) Invention identification, disclosures, and reports. (1) The 
Contractor shall establish and maintain active and effective procedures 
to assure that subject inventions are promptly identified and disclosed 
to Contractor personnel responsible for patent matters within 6 months 
of conception and/or first actual reduction to practice, whichever 
occurs first in the performance of work under this contract. These 
procedures shall include the maintenance of laboratory notebooks or 
equivalent records and other records as are reasonably necessary to 
document the conception and/or the first actual reduction to practice of 
subject inventions, and records that show that the procedures for 
identifying and disclosing the inventions are followed. Upon request, 
the Contractor shall furnish the Contracting Officer a description of 
such procedures for evaluation and for determination as to their 
effectiveness.
    (2) The Contractor shall disclose each subject invention to the 
Contracting Officer within 2 months after the inventor discloses it in 
writing to Contractor personnel responsible for patent matters or, if 
earlier, within 6 months after the Contractor becomes aware that a 
subject invention has been made, but in any event before any on sale, 
public use, or publication of such invention known to the Contractor. 
The disclosure to the agency shall be in the form of a written report 
and shall identify the contract under which the invention was made and 
the inventor(s). It shall be sufficiently complete in technical detail 
to convey a clear understanding, to the extent known at the time of the 
disclosure, of the nature, purpose, operation, and physical, chemical, 
biological, or electrical characteristics of the invention. The 
disclosure shall also identify any publication, on sale, or public use 
of the invention and whether a manuscript describing the invention has 
been submitted for publication and, if so, whether it has been accepted 
for publication at the time of disclosure. In addition, after disclosure 
to the agency, the Contractor shall promptly notify the agency of the 
acceptance of any manuscript describing the invention for publication or 
of any on sale or public use planned by the Contractor.
    (3) The Contractor shall furnish the Contracting Officer the 
following:
    (i) Interim reports every 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 not such 
inventions) and that the procedures required by subparagraph (e)(1) 
above have been followed.
    (ii) A final report, within 3 months after completion of the 
contracted work, listing all subject inventions or stating that there

[[Page 189]]

were no such inventions, and listing all subcontracts at any tier 
containing a patent rights clause or stating that there were no such 
subcontracts.
    (4) The Contractor agrees to require, by written agreement, its 
employees, other than clerical and nontechnical employees, to disclose 
promptly in writing to personnel identified as responsible for the 
administration of patent matters and in a format suggested by the 
Contractor each subject invention made under contract in order that the 
Contractor can comply with the disclosure provisions of paragraph (c) 
above, and to execute all papers necessary to file patent applications 
on subject inventions and to establish the Government's rights in the 
subject inventions. This disclosure format should require, as a minimum, 
the information required by subparagraph (2) above.
    (5) The Contractor agrees subject to FAR 27.302(i) that the 
Government may duplicate and disclose subject invention disclosures and 
all other reports and papers furnished or required to be furnished 
pursuant to this clause.
    (f) Examination of records relating to inventions. (1) The 
Contracting Officer or any authorized representative shall, until 3 
years after final payment under this contract, have the right to examine 
any books (including laboratory notebooks), records, and documents of 
the Contractor relating to the conception or first actual reduction to 
practice of inventions in the same field of technology as the work under 
this contract to determine whether--
    (i) Any such inventions are subject inventions;
    (ii) The Contractor has established and maintains the procedures 
required by subparagraphs (e) (1) and (4) of this clause; and
    (iii) The Contractor and its inventors have complied with the 
procedures.
    (2) If the Contracting Officer learns of an unreported Contractor 
invention which the Contracting Officer believes may be a subject 
invention, the Contractor may be required to disclose the invention to 
the agency for a determination of ownership rights.
    (3) Any examination of records under this paragraph will be subject 
to appropriate conditions to protect the confidentiality of the 
information involved.
    (g) Withholding of payment (this paragraph does not apply to 
subcontracts). (1) Any time before final payment under this contract, 
the Contracting Officer may, in the Government's interest, withhold 
payment until a reserve not exceeding $50,000 or 5 percent of the amount 
of this contract, whichever is less, shall have been set aside if, in 
the Contracting Officer's opinion, the Contractor fails to--
    (i) Establish, maintain, and follow effective procedures for 
identifying and disclosing subject inventions pursuant to subparagraph 
(e)(1) above;
    (ii) Disclose any subject invention pursuant to subparagraph (e)(2) 
above;
    (iii) Deliver acceptable interim reports pursuant to subdivision 
(e)(3)(i) above; or
    (iv) Provide the information regarding subcontracts pursuant to 
subparagraph (h)(4) below.
    (2) Such reserve or balance shall be withheld until the Contracting 
Officer has determined that the Contractor has rectified whatever 
deficiencies exist and has delivered all reports, disclosures, and other 
information required by this clause.
    (3) Final payment under this contract shall not be made before the 
Contractor delivers to the Contracting Officer all disclosures of 
subject inventions required by subparagraph (e)(2) above, and acceptable 
final report pursuant to subdivision (e)(3)(ii) above, and all past due 
confirmatory instruments.
    (4) The Contracting Officer may decrease or increase the sums 
withheld up to the maximum authorized above. No amount shall be withheld 
under this paragraph while the amount specified by this paragraph is 
being withheld under other provisions of the contract. The withholding 
of any amount or the subsequent payment thereof shall not be construed 
as a waiver of any Government rights.
    (h) Subcontracts. (1) The Contractor shall include this clause 
(suitably modified to identify the parties) in all subcontracts, 
regardless of tier, for experimental, developmental, or research work. 
The subcontractor shall retain all rights provided for the Contractor in 
this clause, and the Contractor shall not, as part of the consideration 
for awarding the subcontract, obtain rights in the subcontractor's 
subject inventions.
    (2) In the event of a refusal by a prospective subcontractor to 
accept such a clause the Contractor--
    (i) Shall promptly submit a written notice to the Contracting 
Officer setting forth the subcontractor's reasons for such refusal and 
other pertinent information that may expedite disposition of the matter; 
and
    (ii) Shall not proceed with such subcontract without the written 
authorization of the Contracting Officer.
    (3) In the case of subcontracts at any tier, the agency, 
subcontractor, and Contractor agree that the mutual obligations of the 
parties created by this clause constitute a contract between the 
subcontractor and the Federal agency with respect to those matters 
covered by this clause.
    (4) The Contractor shall promptly notify the Contracting Officer in 
writing upon the award of any subcontract at any tier containing a 
patent rights clause by identifying the subcontractor, the applicable 
patent rights clause, the work to be performed under the subcontract, 
and the dates of

[[Page 190]]

award and estimated completion. Upon request of the Contracting Officer, 
the Contractor shall furnish a copy of such subcontract, and, no more 
frequently than annually, a listing of the subcontracts that have been 
awarded.
    (i) Preference for United States industry. Unless provided 
otherwise, no Contractor that receives title to any subject invention 
and no assignee of any such Contractor shall grant to any person the 
exclusive right to use or sell any subject invention in the United 
States unless such person agrees that any products embodying the subject 
invention will be manufactured substantially in the United States. 
However, in individual cases, the requirement may be waived by the 
Government upon a showing by the Contractor or assignee that reasonable 
but unsuccessful efforts have been made to grant licenses on similar 
terms to potential licensees that would be likely to manufacture 
substantially in the United States or that under the circumstances 
domestic manufacture is not commercially feasible.

                             (End of clause)

    Alternate I (JUN 1989). As prescribed in 27.303(c)(3), add the 
following sentence at the end of subdivision (c)(1)(i) of the basic 
clause:

    The license will include the right of the Government to sublicense 
foreign governments, their nationals, and international organizations 
pursuant to the following treaties or international agreements: ------ *
    [*Contracting Officer complete with the names of applicable existing 
treaties or international agreements. The above language is not intended 
to apply to treaties or agreements that are in effect on the date of the 
award but are not listed.]

    Alternate II (JUN 1989). As prescribed in 27.303(c)(3), add the 
following sentence at the end of subdivision (c)(1)(i) of the basic 
clause:

    The agency reserves the right to unilaterally amend this contract to 
identify specific treaties or international agreements entered into or 
to be entered into by the Government after the effective date of this 
contract, and effectuate those license or other rights which are 
necessary for the Government to meet its obligations to foreign 
governments, their nationals, and international organizations under such 
treaties or international agreements with respect to subject inventions 
made after the date of the amendment.

[49 FR 12994, Mar. 30, 1984, as amended at 54 FR 25073, June 12, 1989; 
62 FR 239, Jan. 2, 1997]



Sec.  52.227-14  Rights in Data--General.

    As prescribed in 27.409(a), insert the following clause with any 
appropriate alternates:

                   Rights in Data--General (JUN 1987)

    (a) Definitions.
    Computer software, as used in this clause, means computer programs, 
computer data bases, and documentation thereof.
    Data, as used in this clause, means recorded information, regardless 
of form or the media on which it may be recorded. The term includes 
technical data and computer software. The term does not include 
information incidental to contract administration, such as financial, 
administrative, cost or pricing, or management information.
    Form, fit, and function data, as used in this clause, means data 
relating to items, components, or processes that are sufficient to 
enable physical and functional interchangeability, as well as data 
identifying source, size, configuration, mating, and attachment 
characteristics, functional characteristics, and performance 
requirements; except that for computer software it means data 
identifying source, functional characteristics, and performance 
requirements but specifically excludes the source code, algorithm, 
process, formulae, and flow charts of the software.
    Limited rights, as used in this clause, means the rights of the 
Government in limited rights data as set forth in the Limited Rights 
Notice of subparagraph (g)(2) if included in this clause.
    Limited rights data, as used in this clause, means data (other than 
computer software) that embody trade secrets or are commercial or 
financial and confidential or privileged, to the extent that such data 
pertain to items, components, or processes developed at private expense, 
including minor modifications thereof.
    Restricted computer software, as used in this clause, means computer 
software developed at private expense and that is a trade secret; is 
commercial or financial and is confidential or privileged; or is 
published copyrighted computer software; including minor modifications 
of such computer software.
    Restricted rights, as used in this clause, means the rights of the 
Government in restricted computer software, as set forth in a Restricted 
Rights Notice of subparagraph (g)(3) if included in this clause, or as 
otherwise may be provided in a collateral agreement incorporated in and 
made part of this contract, including minor modifications of such 
computer software.
    Technical data, as used in this clause, means data (other than 
computer software) which are of a scientific or technical nature.
    Unlimited rights, as used in this clause, means the right of the 
Government to use, disclose, reproduce, prepare derivative

[[Page 191]]

works, distribute copies to the public, and perform publicly and display 
publicly, in any manner and for any purpose, and to have or permit 
others to do so.
    (b) Allocations of rights. (1) Except as provided in paragraph (c) 
of this clause regarding copyright, the Government shall have unlimited 
rights in--
    (i) Data first produced in the performance of this contract;
    (ii) Form, fit, and function data delivered under this contract;
    (iii) Data delivered under this contract (except for restricted 
computer software) that constitute manuals or instructional and training 
material for installation, operation, or routine maintenance and repair 
of items, components, or processes delivered or furnished for use under 
this contract; and
    (iv) All other data delivered under this contract unless provided 
otherwise for limited rights data or restricted computer software in 
accordance with paragraph (g) of this clause.
    (2) The Contractor shall have the right to--
    (i) Use, release to others, reproduce, distribute, or publish any 
data first produced or specifically used by the Contractor in the 
performance of this contract, unless provided otherwise in paragraph (d) 
of this clause;
    (ii) Protect from unauthorized disclosure and use those data which 
are limited rights data or restricted computer software to the extent 
provided in paragraph (g) of this clause;
    (iii) Substantiate use of, add or correct limited rights, restricted 
rights, or copyright notices and to take other appropriate action, in 
accordance with paragraphs (e) and (f) of this clause; and
    (iv) Establish claim to copyright subsisting in data first produced 
in the performance of this contract to the extent provided in 
subparagraph (c)(1) of this clause.
    (c) Copyright. (1) Data first produced in the performance of this 
contract. Unless provided otherwise in paragraph (d) of this clause, the 
Contractor may establish, without prior approval of the Contracting 
Officer, claim to copyright subsisting in scientific and technical 
articles based on or containing data first produced in the performance 
of this contract and published in academic, technical or professional 
journals, symposia proceedings or similar works. The prior, express 
written permission of the Contracting Officer is required to establish 
claim to copyright subsisting in all other data first produced in the 
performance of this contract. When claim to copyright is made, the 
Contractor shall affix the applicable copyright notices of 17 U.S.C. 401 
or 402 and acknowledgment of Government sponsorship (including contract 
number) to the data when such data are delivered to the Government, as 
well as when the data are published or deposited for registration as a 
published work in the U.S. Copyright Office. For data other than 
computer software the Contractor grants to the Government, and others 
acting on its behalf, a paid-up, nonexclusive, irrevocable worldwide 
license in such copyrighted data to reproduce, prepare derivative works, 
distribute copies to the public, and perform publicly and display 
publicly, by or on behalf of the Government. For computer software, the 
Contractor grants to the Government and others acting in its behalf, a 
paid-up nonexclusive, irrevocable worldwide license in such copyrighted 
computer software to reproduce, prepare derivative works, and perform 
publicly and display publicly by or on behalf of the Government.
    (2) Data not first produced in the performance of this contract. The 
Contractor shall not, without prior written permission of the 
Contracting Officer, incorporate in data delivered under this contract 
any data not first produced in the performance of this contract and 
which contains the copyright notice of 17 U.S.C. 401 or 402, unless the 
Contractor identifies such data and grants to the Government, or 
acquires on its behalf, a license of the same scope as set forth in 
subparagraph (c)(1) of this clause; provided, however, that if such data 
are computer software the Government shall acquire a copyright license 
as set forth in subparagraph (g)(3) of this clause if included in this 
contract or as otherwise may be provided in a collateral agreement 
incorporated in or made part of this contract.
    (3) Removal of copyright notices. The Government agrees not to 
remove any copyright notices placed on data pursuant to this paragraph 
(c), and to include such notices on all reproductions of the data.
    (d) Release, publication and use of data. (1) The Contractor shall 
have the right to use, release to others, reproduce, distribute, or 
publish any data first produced or specifically used by the Contractor 
in the performance of this contract, except to the extent such data may 
be subject to the Federal export control or national security laws or 
regulations, or unless otherwise provided in this paragraph of this 
clause or expressly set forth in this contract.
    (2) The Contractor agrees that to the extent it receives or is given 
access to data necessary for the performance of this contract which 
contain restrictive markings, the Contractor shall treat the data in 
accordance with such markings unless otherwise specifically authorized 
in writing by the Contracting Officer.
    (e) Unauthorized marking of data. (1) Notwithstanding any other 
provisions of this contract concerning inspection or acceptance, if any 
data delivered under this contract are marked with the notices specified 
in subparagraph (g)(2) or (g)(3) of this clause and use of such is not 
authorized by this

[[Page 192]]

clause, or if such data bears any other restrictive or limiting markings 
not authorized by this contract, the Contracting Officer may at any time 
either return the data to the Contractor, or cancel or ignore the 
markings. However, the following procedures shall apply prior to 
canceling or ignoring the markings.
    (i) The Contracting Officer shall make written inquiry to the 
Contractor affording the Contractor 30 days from receipt of the inquiry 
to provide written justification to substantiate the propriety of the 
markings;
    (ii) If the Contractor fails to respond or fails to provide written 
justification to substantiate the propriety of the markings within the 
30-day period (or a longer time not exceeding 90 days approved in 
writing by the Contracting Officer for good cause shown), the Government 
shall have the right to cancel or ignore the markings at any time after 
said period and the data will no longer be made subject to any 
disclosure prohibitions.
    (iii) If the Contractor provides written justification to 
substantiate the propriety of the markings within the period set in 
subdivision (e)(1)(i) of this clause, the Contracting Officer shall 
consider such written justification and determine whether or not the 
markings are to be cancelled or ignored. If the Contracting Officer 
determines that the markings are authorized, the Contractor shall be so 
notified in writing. If the Contracting Officer determines, with 
concurrence of the head of the contracting activity, that the markings 
are not authorized, the Contracting Officer shall furnish the Contractor 
a written determination, which determination shall become the final 
agency decision regarding the appropriateness of the markings unless the 
Contractor files suit in a court of competent jurisdiction within 90 
days of receipt of the Contracting Officer's decision. The Government 
shall continue to abide by the markings under this subdivision 
(e)(1)(iii) until final resolution of the matter either by the 
Contracting Officer's determination becoming final (in which instance 
the Government shall thereafter have the right to cancel or ignore the 
markings at any time and the data will no longer be made subject to any 
disclosure prohibitions), or by final disposition of the matter by court 
decision if suit is filed.
    (2) The time limits in the procedures set forth in subparagraph 
(e)(1) of this clause may be modified in accordance with agency 
regulations implementing the Freedom of Information Act (5 U.S.C. 552) 
if necessary to respond to a request thereunder.
    (3) This paragraph (e) does not apply if this contract is for a 
major system or for support of a major system by a civilian agency other 
than NASA and the U.S. Coast Guard agency subject to the provisions of 
Title III of the Federal Property and Administrative Services Act of 
1949.
    (4) Except to the extent the Government's action occurs as the 
result of final disposition of the matter by a court of competent 
jurisdiction, the Contractor is not precluded by this paragraph (e) from 
bringing a claim under the Contract Disputes Act, including pursuant to 
the Disputes clause of this contract, as applicable, that may arise as 
the result of the Government removing or ignoring authorized markings on 
data delivered under this contract.
    (f) Omitted or incorrect markings.
    (1) Data delivered to the Government without either the limited 
rights or restricted rights notice as authorized by paragraph (g) of 
this clause, or the copyright notice required by paragraph (c) of this 
clause, shall be deemed to have been furnished with unlimited rights, 
and the Government assumes no liability for the disclosure, use, or 
reproduction of such data. However, to the extent the data has not been 
disclosed without restriction outside the Government, the Contractor may 
request, within 6 months (or a longer time approved by the Contracting 
Officer for good cause shown) after delivery of such data, permission to 
have notices placed on qualifying data at the Contractor's expense, and 
the Contracting Officer may agree to do so if the Contractor--
    (i) Identifies the data to which the omitted notice is to be 
applied;
    (ii) Demonstrates that the omission of the notice was inadvertent;
    (iii) Establishes that the use of the proposed notice is authorized; 
and
    (iv) Acknowledges that the Government has no liability with respect 
to the disclosure, use, or reproduction of any such data made prior to 
the addition of the notice or resulting from the omission of the notice.
    (2) The Contracting Officer may also (i) permit correction at the 
Contractor's expense of incorrect notices if the Contractor identifies 
the data on which correction of the notice is to be made, and 
demonstrates that the correct notice is authorized, or (ii) correct any 
incorrect notices.
    (g) Protection of limited rights data and restricted computer 
software.
    (1) When data other than that listed in subdivisions (b)(1) (i), 
(ii), and (iii) of this clause are specified to be delivered under this 
contract and qualify as either limited rights data or restricted 
computer software, if the Contractor desires to continue protection of 
such data, the Contractor shall withhold such data and not furnish them 
to the Government under this contract. As a condition to this 
withholding, the Contractor shall identify the data being withheld and 
furnish form, fit, and function data in lieu thereof. Limited rights 
data that are formatted as a

[[Page 193]]

computer data base for delivery to the Government are to be treated as 
limited rights data and not restricted computer software.
    (2)-(3) [Reserved]
    (h) Subcontracting. The Contractor has the responsibility to obtain 
from its subcontractors all data and rights therein necessary to fulfill 
the Contractor's obligations to the Government under this contract. If a 
subcontractor refuses to accept terms affording the Government such 
rights, the Contractor shall promptly bring such refusal to the 
attention of the Contracting Officer and not proceed with subcontract 
award without further authorization.
    (i) Relationship 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.

    Alternate I (JUN 1987). As prescribed in 27.409(b), substitute the 
following definition for Limited Rights Data in paragraph (a) of the 
clause:

    Limited rights data, as used in this clause, means data (other than 
computer software) developed at private expense that embody trade 
secrets or are commercial or financial and confidential or privileged.

    Alternate II (JUN 1987). As prescribed in 27.409(c), insert the 
following subparagraph (g)(2) in the clause:

    (g)(2) Notwithstanding subparagraph (g)(1) of this clause, the 
contract may identify and specify the delivery of limited rights data, 
or the Contracting Officer may require by written request the delivery 
of limited rights data that has been withheld or would otherwise be 
withholdable. If delivery of such data is so required, the Contractor 
may affix the following Limited Rights Notice to the data and the 
Government will thereafter treat the data, subject to the provisions of 
paragraphs (e) and (f) of this clause, in accordance with such Notice:

                    Limited Rights Notice (JUN 1987)

    (a) These data are submitted with limited rights under Government 
Contract No. ------ (and subcontract------, if appropriate). These data 
may be reproduced and used by the Government with the express limitation 
that they will not, without written permission of the Contractor, be 
used for purposes of manufacture nor disclosed outside the Government; 
except that the Government may disclose these data outside the 
Government for the following purposes, if any, provided that the 
Government makes such disclosure subject to prohibition against further 
use and disclosure: [Agencies may list additional purposes as set forth 
in 27.404(d)(1) or if none, so state]
    (b) This Notice shall be marked on any reproduction of these data, 
in whole or in part.

                             (End of notice)

    Alternate III (JUN 1987). As prescribed in 27.409(d), insert the 
following subparagraph (g)(3) in the clause:

    (g)(3)(i) Notwithstanding subparagraph (g)(1) of this clause, the 
contract may identify and specify the delivery of restricted computer 
software, or the Contracting Officer may require by written request the 
delivery of restricted computer software that has been withheld or would 
otherwise be withholdable. If delivery of such computer software is so 
required, the Contractor may affix the following Restricted Rights 
Notice to the computer software and the Government will thereafter treat 
the computer software, subject to paragraphs (e) and (f) of this clause, 
in accordance with the Notice:

                   Restricted Rights Notice (JUN 1987)

    (a) This computer software is submitted with restricted rights under 
Government Contract No.------ (and subcontract------, if appropriate). 
It may not be used, reproduced, or disclosed by the Government except as 
provided in paragraph (b) of this Notice or as otherwise expressly 
stated in the contract.
    (b) This computer software may be--
    (1) Used or copied for use in or with the computer or computers for 
which it was acquired, including use at any Government installation to 
which such computer or computers may be transferred;
    (2) Used or copied for use in a backup computer if any computer for 
which it was acquired is inoperative;
    (3) Reproduced for safekeeping (archives) or backup purposes;
    (4) Modified, adapted, or combined with other computer software, 
provided that the modified, combined, or adapted portions of the 
derivative software incorporating restricted computer software are made 
subject to the same restricted rights;
    (5) Disclosed to and reproduced for use by support service 
Contractors in accordance with subparagraphs (b) (1) through (4) of this 
clause, provided the Government makes such disclosure or reproduction 
subject to these restricted rights; and
    (6) Used or copied for use in or transferred to a replacement 
computer.
    (c) Notwithstanding the foregoing, if this computer software is 
published copyrighted computer software, it is licensed to the 
Government, without disclosure prohibitions, with the minimum rights set 
forth in paragraph (b) of this clause.
    (d) Any other rights or limitations regarding the use, duplication, 
or disclosure of this

[[Page 194]]

computer software are to be expressly stated in, or incorporated in, the 
contract.
    (e) This Notice shall be marked on any reproduction of this computer 
software, in whole or in part.

                             (End of notice)

    (ii) Where it is impractical to include the Restricted Rights Notice 
on restricted computer software, the following short-form Notice may be 
used in lieu thereof:

            Restricted Rights Notice (Short Form) (JUN 1987)

    Use, reproduction, or disclosure is subject to restrictions set 
forth in Contract No.------ (and subcontract ------, if appropriate) 
with ------ (name of Contractor and subcontractor).

                             (End of notice)

    (iii) If restricted computer software is delivered with the 
copyright notice of 17 U.S.C. 401, it will be presumed to be published 
copyrighted computer software licensed to the Government without 
disclosure prohibitions, with the minimum rights set forth in paragraph 
(b) of this clause, unless the Contractor includes the following 
statement with such copyright notice:

    Unpublished--rights reserved under the Copyright Laws of the United 
States.

    Alternate IV (JUN 1987). As prescribed in 27.409(e), substitute the 
following subparagraph (c)(1) in the clause:

    (c) Copyright. (1) Data First Produced in the Performance of the 
Contract. Except as otherwise specifically provided in this contract, 
the Contractor may establish claim to copyright subsisting in any data 
first produced in the performance of this contract. When claim to 
copyright is made, the Contractor shall affix the applicable copyright 
notice of 17 U.S.C. 401 or 402 and acknowledgment of Government 
sponsorship (including contract number) to the data when such data are 
delivered to the Government, as well as when the data are published or 
deposited for registration as a published work in the U.S. Copyright 
Office. For data other than computer software, the Contractor grants to 
the Government, and others acting on its behalf, a paid-up, 
nonexclusive, irrevocable, worldwide license for all such data to 
reproduce, prepare derivative works, distribute copies to the public, 
and perform publicly and display publicly, by or on behalf of the 
Government. For computer software, the Contractor grants to the 
Government and others acting on its behalf, a paid up, nonexclusive, 
irrevocable worldwide license for all such computer software to 
reproduce, prepare derivative works, and perform publicly and display 
publicly, by or on behalf of the Government.

    Alternate V (JUN 1987). As prescribed in 27.409(f), add the 
following paragraph (j) to the clause:

    (j) The Contractor agrees, except as may be otherwise specified in 
this contract for specific data items listed as not subject to this 
paragraph, that the Contracting Officer or an authorized representative 
may, up to three years after acceptance of all items to be delivered 
under this contract, inspect at the Contractor's facility any data 
withheld pursuant to paragraph (g)(1) of this clause, for purposes of 
verifying the Contractor's assertion pertaining to the limited rights or 
restricted rights status of the data or for evaluating work performance. 
Where the Contractor whose data are to be inspected demonstrates to the 
Contracting Officer that there would be a possible conflict of interest 
if the inspection were made by a particular representative, the 
Contracting Officer shall designate an alternate inspector.

[52 FR 18150, May 13, 1987]



Sec.  52.227-15   Representation of Limited Rights Data and Restricted Computer Software.

    As prescribed in 27.409(g), insert the following provision:

 Statement of Limited Rights Data and Restricted Computer Software (MAY 
                                  1999)

    (a) This solicitation sets forth the work to be performed if a 
contract award results, and the Government's known delivery requirements 
for data (as defined in FAR 27.401). Any resulting contract may also 
provide the Government the option to order additional data under the 
Additional Data Requirements clause at 52.227-16 of the FAR, if included 
in the contract. Any data delivered under the resulting contract will be 
subject to the Rights in Data--General clause at 52.227-14 that is to be 
included in this contract. Under the latter clause, a Contractor may 
withhold from delivery data that qualify as limited rights data or 
restricted computer software, and deliver form, fit, and function data 
in lieu thereof. The latter clause also may be used with its Alternates 
II and/or III to obtain delivery of limited rights data or restricted 
computer software, marked with limited rights or restricted rights 
notices, as appropriate. In addition, use of Alternate V with this 
latter clause provides the Government the right to inspect such data at 
the Contractor's facility.
    (b) As an aid in determining the Government's need to include 
Alternate II or Alternate III in the clause at 52.227-14, Rights in 
Data--General, the offeror shall complete paragraph (c) of this 
provision to either state

[[Page 195]]

that none of the data qualify as limited rights data or restricted 
computer software, or identify, to the extent feasible, which of the 
data qualifies as limited rights data or restricted computer software. 
Any identification of limited rights data or restricted computer 
software in the offeror's response is not determinative of the status of 
such data should a contract be awarded to the offeror.
    (c) The offeror has reviewed the requirements for the delivery of 
data or software and states [offeror check appropriate block]--
    [squ] None of the data proposed for fulfilling such requirements 
qualifies as limited rights data or restricted computer software.
    [squ] Data proposed for fulfilling such requirements qualify as 
limited rights data or restricted computer software and are identified 
as follows:
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________

    Note: ``Limited rights data'' and ``Restricted computer software'' 
are defined in the contract clause entitled ``Rights in Data--General.''

                           (End of provision)

[64 FR 10533, Mar. 4, 1999]



Sec.  52.227-16  Additional Data Requirements.

    As prescribed in 27.409(h), insert the following clause:

                 Additional Data Requirements (JUN 1987)

    (a) In addition to the data (as defined in the clause at 52.227-14, 
Rights in Data--General clause or other equivalent included in this 
contract) specified elsewhere in this contract to be delivered, the 
Contracting Officer may, at any time during contract performance or 
within a period of 3 years after acceptance of all items to be delivered 
under this contract, order any data first produced or specifically used 
in the performance of this contract.
    (b) The Rights in Data--General clause or other equivalent included 
in this contract is applicable to all data ordered under this Additional 
Data Requirements clause. Nothing contained in this clause shall require 
the Contractor to deliver any data the withholding of which is 
authorized by the Rights in Data--General or other equivalent clause of 
this contract, or data which are specifically identified in this 
contract as not subject to this clause.
    (c) When data are to be delivered under this clause, the Contractor 
will be compensated for converting the data into the prescribed form, 
for reproduction, and for delivery.
    (d) The Contracting Officer may release the Contractor from the 
requirements of this clause for specifically identified data items at 
any time during the 3-year period set forth in paragraph (a) of this 
clause.

                             (End of clause)

[52 FR 18153, May 13, 1987, as amended 62 FR 40238, July 25, 1997]



Sec.  52.227-17  Rights in Data--Special Works.

    As prescribed in 27.409(i), insert the following clause:

                Rights in Data--Special Works (JUN 1987)

    (a) Definitions.
    Data, as used in this clause, means recorded information regardless 
of form or the medium on which it may be recorded. The term includes 
technical data and computer software. The term does not include 
information incidental to contract administration, such as financial, 
administrative, cost or pricing or management information.
    Unlimited rights, as used in this clause, means the right of the 
Government to use, disclose, reproduce, prepare derivative works, 
distribute copies to the public, and perform publicly and display 
publicly, in any manner and for any purpose whatsoever, and to have or 
permit others to do so.
    (b) Allocation of Rights. (1) The Government shall have--
    (i) Unlimited rights in all data delivered under this contract, and 
in all data first produced in the performance of this contract, except 
as provided in paragraph (c) of this clause for copyright.
    (ii) The right to limit exercise of claim to copyright in data first 
produced in the performance of this contract, and to obtain assignment 
of copyright in such data, in accordance with subparagraph (c)(1) of 
this clause.
    (iii) The right to limit the release and use of certain data in 
accordance with paragraph (d) of this clause.
    (2) The Contractor shall have, to the extent permission is granted 
in accordance with subparagraph (c)(1) of this clause, the right to 
establish claim to copyright subsisting in data first produced in the 
performance of this contract.
    (c) Copyright. (1) Data first produced in the performance of this 
contract.
    (i) The Contractor agrees not to assert, establish, or authorize 
others to assert or establish, any claim to copyright subsisting in any 
data first produced in the performance of this contract without prior 
written permission of the Contracting Officer. When claim to copyright 
is made, the Contractor shall affix the appropriate copyright notice of 
17 U.S.C. 401 or 402 and acknowledgment of

[[Page 196]]

Government sponsorship (including contract number) to such data when 
delivered to the Government, as well as when the data are published or 
deposited for registration as a published work in the U.S. Copyright 
Office. The Contractor grants to the Government, and others acting on 
its behalf, a paid-up nonexclusive, irrevocable, worldwide license for 
all such data to reproduce, prepare derivative works, distribute copies 
to the public, and perform publicly and display publicly, by or on 
behalf of the Government.
    (ii) If the Government desires to obtain copyright in data first 
produced in the performance of this contract and permission has not been 
granted as set forth in subdivision (c)(1)(i) of this clause, the 
Contracting Officer may direct the Contractor to establish, or authorize 
the establishment of, claim to copyright in such data and to assign, or 
obtain the assignment of, such copyright to the Government or its 
designated assignee.
    (2) Data not first produced in the performance of this contract. The 
Contractor shall not, without prior written permission of the 
Contracting Officer, incorporate in data delivered under this contract 
any data not first produced in the performance of this contract and 
which contain the copyright notice of 17 U.S.C. 401 or 402, unless the 
Contractor identifies such data and grants to the Government, or 
acquires on its behalf, a license of the same scope as set forth in 
subparagraph (c)(1) of this clause.
    (d) Release and use restrictions. Except as otherwise specifically 
provided for in this contract, the Contractor shall not use for purposes 
other than the performance of this contract, nor shall the Contractor 
release, reproduce, distribute, or publish any data first produced in 
the performance of this contract, nor authorize others to do so, without 
written permission of the Contracting Officer.
    (e) Indemnity. The Contractor shall indemnify the Government and its 
officers, agents, and employees acting for the Government against any 
liability, including costs and expenses, incurred as the result of the 
violation of trade secrets, copyrights, or right of privacy or 
publicity, arising out of the creation, delivery, publication, or use of 
any data furnished under this contract; or any libelous or other 
unlawful matter contained in such data. The provisions of this paragraph 
do not apply unless the Government provides notice to the Contractor as 
soon as practicable of any claim or suit, affords the Contractor an 
opportunity under applicable laws, rules, or regulations to participate 
in the defense thereof, and obtains the Contractor's consent to the 
settlement of any suit or claim other than as required by final decree 
of a court of competent jurisdiction; nor do these provisions apply to 
material furnished to the Contractor by the Government and incorporated 
in data to which this clause applies.

                             (End of clause)

[52 FR 18153, May 13, 1987, as amended at 54 FR 34758, Aug. 21, 1989; 55 
FR 25532, June 21, 1990]



Sec.  52.227-18  Rights in Data--Existing Works.

    As prescribed in 27.409(j), insert the following clause:

                Rights in Data--Existing Works (JUN 1987)

    (a) Except as otherwise provided in this contract, the Contractor 
grants to the Government, and others acting on its behalf, a paid-up 
nonexclusive, irrevocable, worldwide license to reproduce, prepare 
derivative works, and perform publicly and display publicly, by or on 
behalf of the Government, for all the material or subject matter called 
for under this contract, or for which this clause is specifically made 
applicable.
    (b) The Contractor shall indemnify the Government and its officers, 
agents, and employees acting for the Government against any liability, 
including costs and expenses, incurred as the result of (1) the 
violation of trade secrets, copyrights, or right of privacy or 
publicity, arising out of the creation, delivery, publication or use of 
any data furnished under this contract; or (2) any libelous or other 
unlawful matter contained in such data. The provisions of this paragraph 
do not apply unless the Government provides notice to the Contractor as 
soon as practicable of any claim or suit, affords the Contractor an 
opportunity under applicable laws, rules, or regulations to participate 
in the defense thereof, and obtains the Contractor's consent to the 
settlement of any suit or claim other than as required by final decree 
of a court of competent jurisdiction; and do not apply to material 
furnished to the Contractor by the Government and incorporated in data 
to which this clause applies.

                             (End of clause)

[52 FR 18154, May 13, 1987]



Sec.  52.227-19  Commercial Computer Software--Restricted Rights.

    As prescribed in 27.409(k), insert the following clause:

       Commercial Computer Software--Restricted Rights (JUN 1987)

    (a) As used in this clause, restricted computer software means any 
computer program,

[[Page 197]]

computer data base, or documentation thereof, that has been developed at 
private expense and either is a trade secret, is commercial or financial 
and confidential or--privileged, or is published and copyrighted.
    (b) Notwithstanding any provisions to the contrary contained in any 
Contractor's standard commercial license or lease agreement pertaining 
to any restricted computer software delivered under this purchase order/
contract, and irrespective of whether any such agreement has been 
proposed prior to or after issuance of this purchase order/contract or 
of the fact that such agreement may be affixed to or accompany the 
restricted computer software upon delivery, vendor agrees that the 
Government shall have the rights that are set forth in paragraph (c) of 
this clause to use, duplicate or disclose any restricted computer 
software delivered under this purchase order/contract. The terms and 
provisions of this contract, including any commercial lease or license 
agreement, shall be subject to paragraph (c) of this clause and shall 
comply with Federal laws and the Federal Acquisition Regulation.
    (c)(1) The restricted computer software delivered under this 
contract may not be used, reproduced or disclosed by the Government 
except as provided in subparagraph (c)(2) of this clause or as expressly 
stated otherwise in this contract.
    (2) The restricted computer software may be--
    (i) Used or copied for use in or with the computer or computers for 
which it was acquired, including use at any Government installation to 
which such computer or computers may be transferred;
    (ii) Used or copied for use in or with backup computer if any 
computer for which it was acquired is inoperative;
    (iii) Reproduced for safekeeping (archives) or backup purposes;
    (iv) Modified, adapted, or combined with other computer software, 
provided that the modified, combined, or adapted portions of the 
derivative software incorporating any of the delivered, restricted 
computer software shall be subject to same restrictions set forth in 
this purchase order/contract;
    (v) Disclosed to and reproduced for use by support service 
Contractors or their subcontractors, subject to the same restrictions 
set forth in this purchase order/contract; and
    (vi) Used or copied for use in or transferred to a replacement 
computer.
    (3) If the restricted computer software delivered under this 
purchase order/contract is published and copyrighted, it is licensed to 
the Government, without disclosure prohibitions, with the rights set 
forth in subparagraph (c)(2) of this clause unless expressly stated 
otherwise in this purchase order/contract.
    (4) To the extent feasible the Contractor shall affix a Notice 
substantially as follows to any restricted computer software delivered 
under this purchase order/contract; or, if the vendor does not, the 
Government has the right to do so: Notice-- Notwithstanding any other 
lease or license agreement that may pertain to, or accompany the 
delivery of, this computer software, the rights of the Government 
regarding its use, reproduction and disclosure are as set forth in 
Government Contract (or Purchase Order) No. ------.)
    (d) If any restricted computer software is delivered under this 
contract with the copyright notice of 17 U.S.C. 401, it will be presumed 
to be published and copyrighted and licensed to the Government in 
accordance with subparagraph (c)(3) of this clause, unless a statement 
substantially as follows accompanies such copyright notice: 
Unpublished--rights reserved under the copyright laws of the United 
States.

                             (End of clause)

[52 FR 18154, May 13, 1987]



Sec.  52.227-20  Rights in Data--SBIR Program.

    As prescribed in 27.409(l), insert the following clause:

                 Rights in Data--SBIR Program (MAR 1994)

    (a) Definitions.
    Computer software, as used in this clause, means computer programs, 
computer data bases, and documentation thereof.
    Data, as used in this clause, means recorded information, regardless 
of form or the media on which it may be recorded. The term includes 
technical data and computer software. The term does not include 
information incidental to contract administration, such as financial, 
administrative, cost or pricing or management information.
    Form, fit, and function data, as used in this clause, means data 
relating to items, components, or processes that are sufficient to 
enable physical and functional interchangeability as well as data 
identifying source, size, configuration, mating and attachment 
characteristics, functional characteristics, and performance 
requirements except that for computer software it means data identifying 
source, functional characteristics, and performance requirements but 
specifically excludes the source code, algorithm, process, formulae, and 
flow charts of the software.
    Limited rights data, as used in this clause, means data (other than 
computer software) developed at private expense that embody trade 
secrets or are commercial or financial and confidential or privileged.
    Restricted computer software, as used in this clause, means computer 
software developed at private expense and that is a trade secret; is 
commercial or financial and confidential

[[Page 198]]

or privileged; or is published copyrighted computer software; including 
modifications of such computer software.
    SBIR data, as used in this clause, means data first produced by a 
Contractor that is a small business firm in performance of a small 
business innovation research contract issued under the authority of 15 
U.S.C. 638 (Pub. L. 97-219, Small Business Innovation Development Act of 
1982), which data are not generally known, and which data without 
obligation as to its confidentiality have not been made available to 
others by the Contractor or are not already available to the Government.
    SBIR rights, as used in this clause, mean the rights in SBIR data 
set forth in the SBIR Rights Notice of paragraph (d) of this clause.
    Technical data, as used in this clause, means that data which are of 
a scientific or technical nature.
    Unlimited rights, as used in this clause, means the right of the 
Government to use, disclose, reproduce, prepare derivative works, 
distribute copies to the public, and perform publicly and display 
publicly, in any manner and for any purpose whatsoever, and to have or 
permit others to do so.
    (b) Allocation of rights. (1) Except as provided in paragraph (c) of 
this clause regarding copyright, the Government shall have unlimited 
rights in--
    (i) Data specifically identified in this contract as data to be 
delivered without restriction;
    (ii) Form, fit, and function data delivered under this contract;
    (iii) Data delivered under this contract (except for restricted 
computer software) that constitute manuals or instructional and training 
material for installation, operation, or routine maintenance and repair 
of items, components, or processes delivered or furnished for use under 
this contract; and
    (iv) All other data delivered under this contract unless provided 
otherwise for SBIR data in accordance with paragraph (d) of this clause 
or for limited rights data or restricted computer software in accordance 
with paragraph (f) of this clause.
    (2) The Contractor shall have the right to--
    (i) Protect SBIR rights in SBIR data delivered under this contract 
in the manner and to the extent provided in paragraph (d) of this 
clause;
    (ii) Withhold from delivery those data which are limited rights data 
or restricted computer software to the extent provided in paragraph (g) 
of this clause;
    (iii) Substantiate use of, add, or correct SBIR rights or copyrights 
notices and to take other appropriate action, in accordance with 
paragraph (e) of this clause; and
    (iv) Establish claim to copyright subsisting in data first produced 
in the performance of this contract to the extent provided in 
subparagraph (c)(1) of this clause.
    (c) Copyright. (1) Data first produced in the performance of this 
contract. Except as otherwise specifically provided in this contract, 
the Contractor may establish claim to copyright subsisting in any data 
first produced in the performance of this contract. If claim to 
copyright is made, the Contractor shall affix the applicable copyright 
notice of 17 U.S.C. 401 or 402 and acknowledgment of Government 
sponsorship (including contract number) to the data when such data are 
delivered to the Government, as well as when the data are published or 
deposited for registration as a published work in the U.S. Copyright 
Office. For data other than computer software the Contractor grants to 
the Government, and others acting on its behalf, a paid-up nonexclusive, 
irrevocable, worldwide license to reproduce, prepare derivative works, 
distribute copies to the public, and perform publicly and display 
publicly, by or on behalf of the Government, for all such data. For 
computer software, the Contractor grants to the Government, and others 
acting on its behalf, a paid-up, nonexclusive, irrevocable worldwide 
license for all such computer software to reproduce, prepare derivative 
works, and perform publicly and display publicly, by or on behalf of the 
Government.
    (2) Data not first produced in the performance of this contract. The 
Contractor shall not, without prior written permission of the 
Contracting Officer, incorporate in data delivered under this contract 
any data that are not first produced in the performance of this contract 
and that contain the copyright notice of 17 U.S.C. 401 or 402, unless 
the Contractor identifies such data and grants to the Government, or 
acquires on its behalf, a license of the same scope as set forth in 
subparagraph (c)(1) of this clause.
    (3) Removal of copyright notices. The Government agrees not to 
remove any copyright notices placed on data pursuant to this paragraph 
(c), and to include such notices on all reproductions of the data.
    (d) Rights to SBIR data. (1) The Contractor is authorized to affix 
the following SBIR Rights Notice to SBIR data delivered under this 
contract and the Government will thereafter treat the data, subject to 
the provisions of paragraphs (e) and (f) of this clause, in accordance 
with such Notice:

                      SBIR Rights Notice (MAR 1994)

    These SBIR data are furnished with SBIR rights under Contract No.--
---- (and subcontract ------ if appropriate). For a period of 4 years 
after acceptance of all items to be delivered under this contract, the 
Government agrees to use these data for Government purposes only, and 
they shall not be disclosed outside the Government (including disclosure 
for procurement purposes) during such period without permission of the 
Contractor, except that, subject to the foregoing use and disclosure 
prohibitions, such data

[[Page 199]]

may be disclosed for use by support Contractors. After the aforesaid 4-
year period the Government has a royalty-free license to use, and to 
authorize others to use on its behalf, these data for Government 
purposes, but is relieved of all disclosure prohibitions and assumes no 
liability for unauthorized use of these data by third parties. This 
Notice shall be affixed to any reproductions of these data, in whole or 
in part.

                             (End of notice)

    (2) The Government's sole obligation with respect to any SBIR data 
shall be as set forth in this paragraph (d).
    (e) Omitted or incorrect markings. (1) Data delivered to the 
Government without any notice authorized by paragraph (d) of this 
clause, and without a copyright notice, shall be deemed to have been 
furnished with unlimited rights, and the Government assumes no liability 
for the disclosure, use, or reproduction of such data. However, to the 
extent the data have not been disclosed without restriction outside the 
Government, the Contractor may request, within six months (or a longer 
time approved by the Contracting Officer for good cause shown) after 
delivery of such data, permission to have notices placed on qualifying 
data at the Contractor's expense, and the Contracting Officer may agree 
to do so if the Contractor--
    (i) Identifies the data to which the omitted notice is to be 
applied;
    (ii) Demonstrates that the omission of the notice was inadvertent;
    (iii) Establishes that the use of the proposed notice is authorized; 
and
    (iv) Acknowledges that the Government has no liability with respect 
to the disclosure or use of any such data made prior to the addition of 
the notice or resulting from the omission of the notice.
    (2) The Contracting Officer may also (i) permit correction, at the 
Contractor's expense, of incorrect notices if the Contractor identifies 
the data on which correction of the notice is to be made and 
demonstrates that the correct notice is authorized, or (ii) correct any 
incorrect notices.
    (f) Protection of limited rights data. When data other than that 
listed in subdivisions (b)(1) (i), (ii), and (iii) of this clause are 
specified to be delivered under this contract and such data qualify as 
either limited rights data or restricted computer software, the 
Contractor, if the Contractor desires to continue protection of such 
data, shall withhold such data and not furnish them to the Government 
under this contract. As a condition to this withholding the Contractor 
shall identify the data being withheld and furnish form, fit, and 
function data in lieu thereof.
    (g) Subcontracting. The Contractor has the responsibility to obtain 
from its subcontractors all data and rights therein necessary to fulfill 
the Contractor's obligations to the Government under this contract. If a 
subcontractor refuses to accept terms affording the Government such 
rights, the Contractor shall promptly bring such refusal to the 
attention of the Contracting Officer and not proceed with subcontract 
award without further authorization.
    (h) Relationship 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.

                             (End of clause)

[52 FR 18155, May 13, 1987, as amended at 55 FR 25532, June 21, 1990; 59 
FR 11387, Mar. 10, 1994]



Sec.  52.227-21  Technical Data Declaration, Revision, and Withholding of 
Payment--Major Systems.

    As prescribed in 27.409(q), insert the following clause:

Technical Data Declaration, Revision, and Withholding of Payment--Major 
                           Systems (JAN 1997)

    (a) Scope of clause. This clause shall apply to all technical data 
(as defined in the Rights in Data--General clause included in this 
contract) that have been specified in this contract as being subject to 
this clause. It shall apply to all such data delivered, or required to 
be delivered, at any time during contract performance or within 3 years 
after acceptance of all items (other than technical data) delivered 
under this contract unless a different period is set forth herein. The 
Contracting Officer may release the Contractor from all or part of the 
requirements of this clause for specifically identified technical data 
items at any time during the period covered by this clause.
    (b) Technical data declaration. (1) All technical data that are 
subject to this clause shall be accompanied by the following declaration 
upon delivery:

                  Technical Data Declaration (JAN 1997)

    The Contractor, --------, hereby declares that, to the best of its 
knowledge and belief, the technical data delivered herewith under 
Government contract No. ------ (and subcontract ------, if appropriate) 
are complete, accurate, and comply with the requirements of the contract 
concerning such technical data.

                          (End of declaration)

    (2) The Government shall rely on the declarations set out in 
paragraph (b)(1) of this clause in accepting delivery of the technical 
data, and in consideration thereof may, at

[[Page 200]]

any time during the period covered by this clause, request correction of 
any deficiencies which are not in compliance with contract requirements. 
Such corrections shall be made at the expense of the Contractor. 
Unauthorized markings on data shall not be considered a deficiency for 
the purpose of this clause, but will be treated in accordance with 
paragraph (e) of the Rights in Data--General clause included in this 
contract.
    (c) Technical data revision. The Contractor also agrees, at the 
request of the Contracting Officer, to revise technical data that are 
subject to this clause to reflect engineering design changes made during 
the performance of this contract and affecting the form, fit, and 
function of any item (other than technical data) delivered under this 
contract. The Contractor may submit a request for an equitable 
adjustment to the terms and conditions of this contract for any 
revisions to technical data made pursuant to this paragraph.
    (d) Withholding of payment. (1) At any time before final payment 
under this contract the Contracting Officer may, in the Government's 
interest, withhold payment until a reserve not exceeding $100,000 or 5 
percent of the amount of this contract, whichever is less, if in the 
Contracting Officer's opinion respecting any technical data that are 
subject to this clause, the Contractor fails to--
    (i) Make timely delivery of such technical data as required by this 
contract;
    (ii) Provide the declaration required by paragraph (b)(1) of this 
clause;
    (iii) Make the corrections required by subparagraph (b)(2) of this 
clause; or
    (iv) Make revisions requested under paragraph (c) of this clause.
    (2) Such reserve or balance shall be withheld until the Contracting 
Officer has determined that the Contractor has delivered the data and/or 
has made the required corrections or revisions. Withholding shall not be 
made if the failure to make timely delivery, and/or the deficiencies 
relating to delivered data, arose out of causes beyond the control of 
the Contractor and without the fault or negligence of the Contractor.
    (3) The Contracting Officer may decrease or increase the sums 
withheld up to the sums authorized in subparagraph (d)(1) of this 
clause. The withholding of any amount under this paragraph, or the 
subsequent payment thereof, shall not be construed as a waiver of any 
Government rights.

                             (End of clause)

[52 FR 18155, May 13, 1987, as amended at 62 FR 239, Jan. 2, 1997]



Sec.  52.227-22  Major System--Minimum Rights.

    As prescribed in 27.409(r), insert the following clause:

                 Major System--Minimum Rights (JUN 1987)

    Notwithstanding any other provision of this contract, the Government 
shall have unlimited rights in any technical data, other than computer 
software, developed in the performance of this contract and relating to 
a major system or supplies for a major system procured or to be procured 
by the Government, to the extent that delivery of such technical data is 
required as an element of performance under this contract. The rights of 
the Government under this clause are in addition to and not in lieu of 
its rights under the other provisions of this contract.

                             (End of clause)

[52 FR 18156, May 13, 1987]



Sec.  52.227-23  Rights to Proposal Data (Technical).

    As prescribed in 27.409(s), insert the following clause:

             Rights to Proposal Data (Technical) (JUN 1987)

    Except for data contained on pages ------, it is agreed that as a 
condition of award of this contract, and notwithstanding the conditions 
of any notice appearing thereon, the Government shall have unlimited 
rights (as defined in the Rights in Data--General clause contained in 
this contract) in and to the technical data contained in the proposal 
dated ------, upon which this contract is based.

                             (End of clause)

[52 FR 18156, May 13, 1987]



Sec.  52.228-1  Bid Guarantee.

    As prescribed in 28.101-2, insert a provision or clause 
substantially as follows:

                        Bid Guarantee (SEP 1996)

    (a) Failure to furnish a bid guarantee in the proper form and 
amount, by the time set for opening of bids, may be cause for rejection 
of the bid.
    (b) The bidder shall furnish a bid guarantee in the form of a firm 
commitment, e.g., bid bond supported by good and sufficient surety or 
sureties acceptable to the Government, postal money order, certified 
check, cashier's check, irrevocable letter of credit, or,

[[Page 201]]

under Treasury Department regulations, certain bonds or notes of the 
United States. The Contracting Officer will return bid guarantees, other 
than bid bonds, (1) to unsuccessful bidders as soon as practicable after 
the opening of bids, and (2) to the successful bidder upon execution of 
contractual documents and bonds (including any necessary coinsurance or 
reinsurance agreements), as required by the bid as accepted.
    (c) The amount of the bid guarantee shall be -------- percent of the 
bid price or $--------, whichever is less.
    (d) If the successful bidder, upon acceptance of its bid by the 
Government within the period specified for acceptance, fails to execute 
all contractual documents or furnish executed bond(s) within 10 days 
after receipt of the forms by the bidder, the Contracting Officer may 
terminate the contract for default.
    (e) In the event the contract is terminated for default, the bidder 
is liable for any cost of acquiring the work that exceeds the amount of 
its bid, and the bid guarantee is available to offset the difference.

                           (End of provision)

[61 FR 39213, July 26, 1996]



Sec.  52.228-2  Additional Bond Security.

    As prescribed in 28.106-4(a), insert the following clause:

                   Additional Bond Security (OCT 1997)

    The Contractor shall promptly furnish additional security required 
to protect the Government and persons supplying labor or materials under 
this contract if--
    (a) Any surety upon any bond, or issuing financial institution for 
other security, furnished with this contract becomes unacceptable to the 
Government;
    (b) Any surety fails to furnish reports on its financial condition 
as required by the Government;
    (c) The contract price is increased so that the penal sum of any 
bond becomes inadequate in the opinion of the Contracting Officer; or
    (d) An irrevocable letter of credit (ILC) used as security will 
expire before the end of the period of required security. If the 
Contractor does not furnish an acceptable extension or replacement ILC, 
or other acceptable substitute, at least 30 days before an ILC's 
scheduled expiration, the Contracting officer has the right to 
immediately draw on the ILC.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 31653, June 20, 1996; 
62 FR 44807, Aug. 22, 1997]



Sec.  52.228-3  Workers' Compensation Insurance (Defense Base Act).

    As prescribed in 28.309(a), insert the following clause:

      Workers' Compensation Insurance (Defense Base Act) (APR 1984)

    The Contractor shall (a) provide, before commencing performance 
under this contract, such workers' compensation insurance or security as 
the Defense Base Act (42 U.S.C. 1651 et seq.) requires and (b) continue 
to maintain it until performance is completed. The Contractor shall 
insert, in all subcontracts under this contract to which the Defense 
Base Act applies, a clause similar to this clause (including this 
sentence) imposing upon those subcontractors this requirement to comply 
with the Defense Base Act.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 68 FR 28086, May 22, 2003]



Sec.  52.228-4  Workers' Compensation and War-Hazard Insurance Overseas.

    As prescribed in 28.309(b), insert the following clause:

   Workers' Compensation and War-Hazard Insurance Overseas (APR 1984)

    (a) This paragraph applies if the Contractor employs any person who, 
but for a waiver granted by the Secretary of Labor, would be subject to 
workers' compensation insurance under the Defense Base Act (42 U.S.C. 
1651 et seq.). On behalf of employees for whom the applicability of the 
Defense Base Act has been waived, the Contractor shall (1) provide, 
before commencing performance under this contract, at least that 
workers' compensation insurance or the equivalent as the laws of the 
country of which these employees are nationals may require and (2) 
continue to maintain it until performance is completed. The Contractor 
shall insert, in all subcontracts under this contract to which the 
Defense Base Act would apply but for the waiver, a clause similar to 
this paragraph (a) (including this sentence) imposing upon those 
subcontractors this requirement to provide such workers' compensation 
insurance coverage.

[[Page 202]]

    (b) This paragraph applies if the Contractor or any subcontractor 
under this contract employs any person who, but for a waiver granted by 
the Secretary of Labor, would be subject to the War Hazards Compensation 
Act (42 U.S.C. 1701 et seq.). On behalf of employees for whom the 
applicability of the Defense Base Act (and hence that of the War Hazards 
Compensation Act) has been waived, the Contractor shall, subject to 
reimbursement as provided elsewhere in this contract, afford the same 
protection as that provided in the War Hazards Compensation Act, except 
that the level of benefits shall conform to any law or international 
agreement controlling the benefits to which the employees may be 
entitled. In all other respects, the standards of the War Hazards 
Compensation Act shall apply; e.g., the definition of war-hazard risks 
(injury, death, capture, or detention as the result of a war hazard as 
defined in the Act), proof of loss, and exclusion of benefits otherwise 
covered by workers' compensation insurance or the equivalent. Unless the 
Contractor elects to assume directly the liability to subcontractor 
employees created by this clause, the Contractor shall insert, in all 
subcontracts under this contract to which the War Hazards Compensation 
Act would apply but for the waiver, a clause similar to this paragraph 
(b) (including this sentence) imposing upon those subcontractors this 
requirement to provide war-hazard benefits.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 68 FR 28086, May 22, 2003]



Sec.  52.228-5  Insurance--Work on a Government Installation.

    As prescribed in 28.310, insert the following clause:

         Insurance--Work on a Government Installation (JAN 1997)

    (a) The Contractor shall, at its own expense, provide and maintain 
during the entire performance of this contract, at least the kinds and 
minimum amounts of insurance required in the schedule or elsewhere in 
the contract.
    (b) Before commencing work under this contract, the Contractor shall 
notify the Contracting Officer in writing that the required insurance 
has been obtained. The policies evidencing required insurance shall 
contain an endorsement to the effect that any cancellation or any 
material change adversely affecting the Government's interest shall not 
be effective (1) for such period as the laws of the State in which this 
contract is to be performed prescribe or (2) until 30 days after the 
insurer or the Contractor gives written notice to the Contracting 
Officer, whichever period is longer.
    (c) The Contractor shall insert the substance of this clause, 
including this paragraph (c), in subcontracts under this contract that 
require work on a Government installation and shall require 
subcontractors to provide and maintain the insurance required in the 
Schedule or elsewhere in the contract. The Contractor shall maintain a 
copy of all subcontractors' proofs of required insurance, and shall make 
copies available to the Contracting Officer upon request.

                             (End of clause)

[54 FR 34758, Aug. 21, 1989; 62 FR 239, Jan. 2, 1997]



Sec.  52.228-6  [Reserved]



Sec.  52.228-7  Insurance--Liability to Third Persons.

    As prescribed in 28.311-1, insert the following clause:

            Insurance--Liability to Third Persons (MAR 1996)

    (a)(1) Except as provided in subparagraph (a)(2) of this clause, the 
Contractor shall provide and maintain workers' compensation, employer's 
liability, comprehensive general liability (bodily injury), 
comprehensive automobile liability (bodily injury and property damage) 
insurance, and such other insurance as the Contracting Officer may 
require under this contract.
    (2) The Contractor may, with the approval of the Contracting 
Officer, maintain a self-insurance program; provided that, with respect 
to workers' compensation, the Contractor is qualified pursuant to 
statutory authority.
    (3) All insurance required by this paragraph shall be in a form and 
amount and for those periods as the Contracting Officer may require or 
approve and with insurers approved by the Contracting Officer.
    (b) The Contractor agrees to submit for the Contracting Officer's 
approval, to the extent and in the manner required by the Contracting 
Officer, any other insurance that is maintained by the Contractor in 
connection with the performance of this contract and for which the 
Contractor seeks reimbursement.
    (c) The Contractor shall be reimbursed--
    (1) For that portion (i) of the reasonable cost of insurance 
allocable to this contract and (ii) required or approved under this 
clause; and
    (2) For certain liabilities (and expenses incidental to such 
liabilities) to third persons not compensated by insurance or otherwise 
without regard to and as an exception to the limitation of cost or the 
limitation of funds

[[Page 203]]

clause of this contract. These liabilities must arise out of the 
performance of this contract, whether or not caused by the negligence of 
the Contractor or of the Contractor's agents, servants, or employees, 
and must be represented by final judgments or settlements approved in 
writing by the Government. These liabilities are for--
    (i) Loss of or damage to property (other than property owned, 
occupied, or used by the Contractor, rented to the Contractor, or in the 
care, custody, or control of the Contractor); or
    (ii) Death or bodily injury.
    (d) The Government's liability under paragraph (c) of this clause is 
subject to the availability of appropriated funds at the time a 
contingency occurs. Nothing in this contract shall be construed as 
implying that the Congress will, at a later date, appropriate funds 
sufficient to meet deficiencies.
    (e) The Contractor shall not be reimbursed for liabilities (and 
expenses incidental to such liabilities)--
    (1) For which the Contractor is otherwise responsible under the 
express terms of any clause specified in the Schedule or elsewhere in 
the contract;
    (2) For which the Contractor has failed to insure or to maintain 
insurance as required by the Contracting Officer; or
    (3) That result from willful misconduct or lack of good faith on the 
part of any of the Contractor's directors, officers, managers, 
superintendents, or other 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 in which this contract is being 
performed; or
    (iii) A separate and complete major industrial operation in 
connection with the performance of this contract.
    (f) The provisions of paragraph (e) of this clause shall not 
restrict the right of the Contractor to be reimbursed for the cost of 
insurance maintained by the Contractor in connection with the 
performance of this contract, other than insurance required in 
accordance with this clause; provided, that such cost is allowable under 
the Allowable Cost and Payment clause of this contract.
    (g) If any suit or action is filed or any claim is made against the 
Contractor, the cost and expense of which may be reimbursable to the 
Contractor under this contract, and the risk of which is then uninsured 
or is insured for less than the amount claimed, the Contractor shall--
    (1) Immediately notify the Contracting Officer and promptly furnish 
copies of all pertinent papers received;
    (2) Authorize Government representatives to collaborate with counsel 
for the insurance carrier in settling or defending the claim when the 
amount of the liability claimed exceeds the amount of coverage; and
    (3) Authorize Government representatives to settle or defend the 
claim and to represent the Contractor in or to take charge of any 
litigation, if required by the Government, when the liability is not 
insured or covered by bond. The Contractor may, at its own expense, be 
associated with the Government representatives in any such claim or 
litigation.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 52799, Dec. 21, 1990; 
61 FR 2640, Jan. 26, 1996]



Sec.  52.228-8  Liability and Insurance--Leased Motor Vehicles.

    As prescribed in 28.312, insert the following clause:

        Liability and Insurance--Leased Motor Vehicles (MAY 1999)

    (a) The Government shall be responsible for loss of or damage to--
    (1) Leased vehicles, except for (i) normal wear and tear and (ii) 
loss or damage caused by the negligence of the Contractor, its agents, 
or employees; and
    (2) Property of third persons, or the injury or death of third 
persons, if the Government is liable for such loss, damage, injury, or 
death under the Federal Tort Claims Act (28 U.S.C. 2671-2680).
    (b) The Contractor shall be liable for, and shall indemnify and hold 
harmless the Government against, all actions or claims for loss of or 
damage to property or the injury or death of persons, resulting from the 
fault, negligence, or wrongful act or omission of the Contractor, its 
agents, or employees.
    (c) The Contractor shall provide and maintain insurance covering its 
liabilities under paragraph (b) of this clause, in amounts of at least 
$200,000 per person and $500,000 per occurrence for death or bodily 
injury and $20,000 per occurrence for property damage or loss.
    (d) Before commencing work under this contract, the Contractor shall 
notify the Contracting Officer in writing that the required insurance 
has been obtained. The policies evidencing required insurance shall 
contain an endorsement to the effect that any cancellation or any 
material change adversely affecting the interests of the Government 
shall not be effective (1) for such period as the laws of the State in 
which this contract is to be performed prescribe or (2) until 30 days 
after written notice to the Contracting Officer, whichever period is 
longer. The policies shall exclude any claim by the

[[Page 204]]

insurer for subrogation against the Government by reason of any payment 
under the policies.
    (e) The contract price shall not include any costs for insurance or 
contingency to cover losses, damage, injury, or death for which the 
Government is responsible under paragraph (a) of this clause.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 38518, Sept. 18, 1990; 
59 FR 11388, Mar. 10, 1994; 62 FR 239, Jan. 2, 1997; 64 FR 10534, Mar. 
4, 1999]



Sec.  52.228-9   Cargo Insurance.

    As prescribed in 28.313(a), insert the following clause:

                       Cargo Insurance (MAY 1999)

    (a) The Contractor, at the Contractor's expense, shall provide and 
maintain, during the continuance of this contract, cargo insurance of 
$---------- per vehicle to cover the value of property on each vehicle 
and of $---------- to cover the total value of the property in the 
shipment.
    (b) All insurance shall be written on companies acceptable to ------
---- [insert name of contracting agency], and policies shall include 
such terms and conditions as required by ---------- [insert name of 
contracting agency]. The Contractor shall provide evidence of acceptable 
cargo insurance to ---------- [insert name of contracting agency] before 
commencing operations under this contract.
    (c) Each cargo insurance policy shall include the following 
statement:
    ``It is a condition of this policy that the Company shall furnish--
    (1) Written notice to ---------- [insert name and address of 
contracting agency], 30 days in advance of the effective date of any 
reduction in, or cancellation of, this policy; and
    (2) Evidence of any renewal policy to the address specified in 
paragraph (1) of this statement, not less than 15 days prior to the 
expiration of any current policy on file with ---------- [insert name of 
contracting agency].''

                             (End of clause)

[64 FR 10534, Mar. 4, 1999]



Sec.  52.228-10  Vehicular and General Public Liability Insurance.

    As prescribed in 28.313(b), insert a clause substantially the same 
as the following in solicitations and contracts for transportation or 
for transportation-related services when the contracting officer 
determines that vehicular liability or general public liability 
insurance required by law is not sufficient:

       Vehicular and General Public Liability Insurance (APR 1984)

    (a) The Contractor, at the Contractor's expense, agrees to maintain, 
during the continuance of this contract, vehicular liability and general 
public liability insurance with limits of liability for (1) bodily 
injury of not less than $---- for each person and $---- for each 
occurrence and (2) property damage of not less than $---- for each 
accident and $---- in the aggregate.
    (b) The Contractor also agrees to maintain workers' compensation and 
other legally required insurance with respect to the Contractor's own 
employees and agents.

                             (End of clause)



Sec.  52.228-11  Pledges of Assets.

    As prescribed in 28.203-6, insert the following clause:

                      Pledges of Assets (FEB 1990)

    (a) Offerors shall obtain from each person acting as an individual 
surety on a bid guarantee, a performance bond, or a payment bond--
    (1) Pledge of assets; and
    (2) Standard Form 28, Affidavit of Individual Surety.
    (b) Pledges of assets from each person acting as an individual 
surety shall be in the form of--
    (1) Evidence of an escrow account containing cash, certificates of 
deposit, commercial or Government securities, or other assets described 
in FAR 28.203-2 (except see 28.203-2(b)(2) with respect to Government 
securities held in book entry form) and/or;
    (2) A recorded lien on real estate. The offeror will be required to 
provide--
    (i) Evidence of title in the form of a certificate of title prepared 
by a title insurance company approved by the United States Department of 
Justice. This title evidence must show fee simple title vested in the 
surety along with any concurrent owner: whether any real estate taxes 
are due and payable; and any recorded encumbrances against the property, 
including the lien filed in favor of the Government as required by FAR 
28.203-3(d);
    (ii) Evidence of the amount due under any encumbrance shown in the 
evidence of title;
    (iii) A copy of the current real estate tax assessment of the 
property or a current appraisal dated no earlier than 6 months prior to 
the date of the bond, prepared by a professional appraiser who certifies 
that the appraisal has been conducted in accordance with the generally 
accepted appraisal standards as reflected in the Uniform Standards of

[[Page 205]]

Professional Appraisal Practice, as promulgated by the Appraisal 
Foundation.

                             (End of clause)

[54 FR 48995, Nov. 28, 1989, as amended at 56 FR 67137, Dec. 27, 1991]



Sec.  52.228-12  Prospective Subcontractor Requests for Bonds.

    As prescribed in 28.106-4(b), use the following clause:

         Prospective Subcontractor Requests for Bonds (OCT 1995)

    In accordance with section 806(a)(3) of Pub. L. 102-190, as amended 
by sections 2091 and 8105 of Pub. L. 103-355, upon the request of a 
prospective subcontractor or supplier offering to furnish labor or 
material for the performance of this contract for which a payment bond 
has been furnished to the Government pursuant to the Miller Act, the 
Contractor shall promptly provide a copy of such payment bond to the 
requester.

                             (End of clause)

[60 FR 48274, Sept. 18, 1995]



Sec.  52.228-13  Alternative Payment Protections.

    As prescribed in 28.102-3(b), insert the following clause:

               Alternative Payment Protections (JUL 2000)

    (a) The Contractor shall submit one of the following payment 
protections:
________________________________________________________________________

________________________________________________________________________

________________________________________________________________________
    (b) The amount of the payment protection shall be 100 percent of the 
contract price.
    (c) The submission of the payment protection is required within ---- 
days of contract award.
    (d) The payment protection shall provide protection for the full 
contract performance period plus a one-year period.
    (e) Except for escrow agreements and payment bonds, which provide 
their own protection procedures, the Contracting Officer is authorized 
to access funds under the payment protection when it has been alleged in 
writing by a supplier of labor or material that a nonpayment has 
occurred, and to withhold such funds pending resolution by 
administrative or judicial proceedings or mutual agreement of the 
parties.
    (f) When a tripartite escrow agreement is used, the Contractor shall 
utilize only suppliers of labor and material that signed the escrow 
agreement.

                             (End of clause)

[61 FR 31654, June 20, 1996, as amended at 62 FR 44807, Aug. 22, 1997; 
65 FR 46071, July 26, 2000]



Sec.  52.228-14  Irrevocable Letter of Credit.

    As prescribed in 28.204-4, insert the following clause:

                 Irrevocable Letter of Credit (DEC 1999)

    (a) ``Irrevocable letter of credit'' (ILC), as used in this clause, 
means a written commitment by a federally insured financial institution 
to pay all or part of a stated amount of money, until the expiration 
date of the letter, upon presentation by the Government (the 
beneficiary) of a written demand therefor. Neither the financial 
institution nor the offeror/Contractor can revoke or condition the 
letter of credit.
    (b) If the offeror intends to use an ILC in lieu of a bid bond, or 
to secure other types of bonds such as performance and payment bonds, 
the letter of credit and letter of confirmation formats in paragraphs 
(e) and (f) of this clause shall be used.
    (c) The letter of credit shall be irrevocable, shall require 
presentation of no document other than a written demand and the ILC 
(including confirming letter, if any), shall be issued/confirmed by an 
acceptable federally insured financial institution as provided in 
paragraph (d) of this clause, and--
    (1) If used as a bid guarantee, the ILC shall expire no earlier than 
60 days after the close of the bid acceptance period;
    (2) If used as an alternative to corporate or individual sureties as 
security for a performance or payment bond, the offeror/Contractor may 
submit an ILC with an initial expiration date estimated to cover the 
entire period for which financial security is required or may submit an 
ILC with an initial expiration date that is a minimum period of one year 
from the date of issuance. The ILC shall provide that, unless the issuer 
provides the beneficiary written notice of non-renewal at least 60 days 
in advance of the current expiration date, the ILC is automatically 
extended without amendment for one year from the expiration date, or any 
future expiration date, until the period of required coverage is 
completed and the Contracting Officer provides the financial institution 
with a written statement waiving the right to payment. The period of 
required coverage shall be:
    (i) For contracts subject to the Miller Act, the later of--
    (A) One year following the expected date of final payment;
    (B) For performance bonds only, until completion of any warranty 
period; or
    (C) For payment bonds only, until resolution of all claims filed 
against the payment

[[Page 206]]

bond during the one-year period following final payment.
    (ii) For contracts not subject to the Miller Act, the later of--
    (A) 90 days following final payment; or
    (B) For performance bonds only, until completion of any warranty 
period.
    (d) Only federally insured financial institutions rated investment 
grade or higher shall issue or confirm the ILC. The offeror/Contractor 
shall provide the Contracting Officer a credit rating that indicates the 
financial institution has the required rating(s) as of the date of 
issuance of the ILC. Unless the financial institution issuing the ILC 
had letter of credit business of at least $25 million in the past year, 
ILCs over $5 million must be confirmed by another acceptable financial 
institution that had letter of credit business of at least $25 million 
in the past year.
    (e) The following format shall be used by the issuing financial 
institution to create an ILC:
________________________________________________________________________
[Issuing Financial Institution's Letterhead or Name and Address]
Issue Date______________________________________________________________
Irrevocable Letter of Credit No.________________________________________
Account party's name____________________________________________________
Account party's address_________________________________________________
For Solicitation No.____________________________________________________
(For reference only)
    TO: [U.S. Government agency]
    [U.S. Government agency's address]
    1. We hereby establish this irrevocable and transferable Letter of 
Credit in your favor for one or more drawings up to United States $----. 
This Letter of Credit is payable at [issuing financial institution's 
and, if any, confirming financial institution's] office at [issuing 
financial institution's address and, if any, confirming financial 
institution's address] and expires with our close of business on ----, 
or any automatically extended expiration date.
    2. We hereby undertake to honor your or the transferee's sight 
draft(s) drawn on the issuing or, if any, the confirming financial 
institution, for all or any part of this credit if presented with this 
Letter of Credit and confirmation, if any, at the office specified in 
paragraph 1 of this Letter of Credit on or before the expiration date or 
any automatically extended expiration date.
    3. [This paragraph is omitted if used as a bid guarantee, and 
subsequent paragraphs are renumbered.] It is a condition of this Letter 
of Credit that it is deemed to be automatically extended without 
amendment for one year from the expiration date hereof, or any future 
expiration date, unless at least 60 days prior to any expiration date, 
we notify you or the transferee by registered mail, or other receipted 
means of delivery, that we elect not to consider this Letter of Credit 
renewed for any such additional period. At the time we notify you, we 
also agree to notify the account party (and confirming financial 
institution, if any) by the same means of delivery.
    4. This Letter of Credit is transferable. Transfers and assignments 
of proceeds are to be effected without charge to either the beneficiary 
or the transferee/assignee of proceeds. Such transfer or assignment 
shall be only at the written direction of the Government (the 
beneficiary) in a form satisfactory to the issuing financial institution 
and the confirming financial institution, if any.
    5. This Letter of Credit is subject to the Uniform Customs and 
Practice (UCP) for Documentary Credits, 1993 Revision, International 
Chamber of Commerce Publication No. 500, and to the extent not 
inconsistent therewith, to the laws of ------------ [state of confirming 
financial institution, if any, otherwise state of issuing financial 
institution].
    6. If this credit expires during an interruption of business of this 
financial institution as described in Article 17 of the UCP, the 
financial institution specifically agrees to effect payment if this 
credit is drawn against within 30 days after the resumption of our 
business.

     Sincerely,

[Issuing financial institution]
    (f) The following format shall be used by the financial institution 
to confirm an ILC:
[Confirming Financial Institution's Letterhead or Name and Address]_____
(Date)--------------
Our Letter of Credit
Advice Number___________________________________________________________
Beneficiary:____________________________________________________________
[U.S. Government agency]
Issuing Financial Institution:__________________________________________
Issuing Financial Institution's LC No.:_________________________________
    Gentlemen:
    1. We hereby confirm the above indicated Letter of Credit, the 
original of which is attached, issued by ---------- [name of issuing 
financial institution] for drawings of up to United States dollars ----
------/U.S. $---------- and expiring with our close of business on ----
------ [the expiration date], or any automatically extended expiration 
date.
    2. Draft(s) drawn under the Letter of Credit and this Confirmation 
are payable at our office located at ------------.
    3. We hereby undertake to honor sight draft(s) drawn under and 
presented with the Letter of Credit and this Confirmation at our offices 
as specified herein.
    4. [This paragraph is omitted if used as a bid guarantee, and 
subsequent paragraphs are renumbered.] It is a condition of this 
confirmation that it be deemed automatically extended without amendment 
for one year from the expiration date hereof, or any automatically 
extended expiration date, unless:
    (a) At least 60 days prior to any such expiration date, we shall 
notify the Contracting Officer, or the transferee and the issuing 
financial institution, by registered mail or

[[Page 207]]

other receipted means of delivery, that we elect not to consider this 
confirmation extended for any such additional period; or
    (b) The issuing financial institution shall have exercised its right 
to notify you or the transferee, the account party, and ourselves, of 
its election not to extend the expiration date of the Letter of Credit.
    5. This confirmation is subject to the Uniform Customs and Practice 
(UCP) for Documentary Credits, 1993 Revision, International Chamber of 
Commerce Publication No. 500, and to the extent not inconsistent 
therewith, to the laws of ---------- [state of confirming financial 
institution].
    6. If this confirmation expires during an interruption of business 
of this financial institution as described in Article 17 of the UCP, we 
specifically agree to effect payment if this credit is drawn against 
within 30 days after the resumption of our business.
Sincerely,
________________________________________________________________________
[Confirming financial institution]

    (g) The following format shall be used by the Contracting Officer 
for a sight draft to draw on the Letter of Credit:
SIGHT DRAFT
________________________________________________________________________
[City, State]
(Date)--------------
[Name and address of financial institution]
Pay to the order of_____________________________________________________
[Beneficiary Agency] ----------
the sum of United States $ ----------[bdlarr]___________________________
This draft is drawn under_______________________________________________
Irrevocable Letter of Credit No.________________________________________
________________________________________________________________________
[Beneficiary Agency]
By: --------------------

                             (End of clause)

[61 FR 31654, June 20, 1996, as amended at 61 FR 67430, Dec. 20, 1996; 
62 FR 44808, Aug. 22, 1997; 64 FR 72451, Dec. 27, 1999]



Sec.  52.228-15  Performance and Payment Bonds--Construction.

    As prescribed in 28.102-3(a), insert a clause substantially as 
follows:

         Performance and Payment Bonds-- Construction (JUL 2000)

    (a) Definitions. As used in this clause--
    Original contract price means the award price of the contract; or, 
for requirements contracts, the price payable for the estimated total 
quantity; or, for indefinite-quantity contracts, the price payable for 
the specified minimum quantity. Original contract price does not include 
the price of any options, except those options exercised at the time of 
contract award.
    (b) Amount of required bonds. Unless the resulting contract price is 
$100,000 or less, the successful offeror shall furnish performance and 
payment bonds to the Contracting Officer as follows:
    (1) Performance bonds (Standard Form 25). The penal amount of 
performance bonds at the time of contract award shall be 100 percent of 
the original contract price.
    (2) Payment Bonds (Standard Form 25-A). The penal amount of payment 
bonds at the time of contract award shall be 100 percent of the original 
contract price.
    (3) Additional bond protection. (i) The Government may require 
additional performance and payment bond protection if the contract price 
is increased. The increase in protection generally will equal 100 
percent of the increase in contract price.
    (ii) The Government may secure the additional protection by 
directing the Contractor to increase the penal amount of the existing 
bond or to obtain an additional bond.
    (c) Furnishing executed bonds. The Contractor shall furnish all 
executed bonds, including any necessary reinsurance agreements, to the 
Contracting Officer, within the time period specified in the Bid 
Guarantee provision of the solicitation, or otherwise specified by the 
Contracting Officer, but in any event, before starting work.
    (d) Surety or other security for bonds. The bonds shall be in the 
form of firm commitment, supported by corporate sureties whose names 
appear on the list contained in Treasury Department Circular 570, 
individual sureties, or by other acceptable security such as postal 
money order, certified check, cashier's check, irrevocable letter of 
credit, or, in accordance with Treasury Department regulations, certain 
bonds or notes of the United States. Treasury Circular 570 is published 
in the Federal Register or may be obtained from the U.S. Department of 
Treasury, Financial Management Service, Surety Bond Branch, 401 14th 
Street, NW, 2nd Floor, West Wing, Washington, DC 20227.
    (e) Notice of subcontractor waiver of protection (40 U.S.C. 270b(c). 
Any waiver of the right to sue on the payment bond is void unless it is 
in writing, signed by the person whose right is waived, and executed 
after such person has first furnished labor or material for use in the 
performance of the contract.

                             (End of clause)

[65 FR 46071, July 26, 2000]



Sec.  52.228-16  Performance and Payment Bonds--Other Than Construction.

    As prescribed in 28.103-4, insert a clause substantially as follows:

    Performance and Payment Bonds--Other Than Construction (JUL 2000)

    (a) Definitions. As used in this clause--

[[Page 208]]

    Original contract price means the award price of the contract or, 
for requirements contracts, the price payable for the estimated 
quantity; or, for indefinite-quantity contracts, the price payable for 
the specified minimum quantity. Original contract price does not include 
the price of any options, except those options exercised at the time of 
contract award.
    (b) The Contractor shall furnish a performance bond (Standard Form 
1418) for the protection of the Government in an amount equal to ------
-- percent of the original contract price and a payment bond (Standard 
Form 1416) in an amount equal to -------- percent of the original 
contract price.
    (c) The Contractor shall furnish all executed bonds, including any 
necessary reinsurance agreements, to the Contracting Officer, within --
------ days, but in any event, before starting work.
    (d) The Government may require additional performance and payment 
bond protection if the contract price is increased. The Government may 
secure the additional protection by directing the Contractor to increase 
the penal amount of the existing bonds or to obtain additional bonds.
    (e) The bonds shall be in the form of firm commitment, supported by 
corporate sureties whose names appear on the list contained in Treasury 
Department Circular 570, individual sureties, or by other acceptable 
security such as postal money order, certified check, cashier's check, 
irrevocable letter of credit, or, in accordance with Treasury Department 
regulations, certain bonds or notes of the United States. Treasury 
Circular 570 is published in the Federal Register, or may be obtained 
from the U.S. Department of Treasury, Financial Management Service, 
Surety Bond Branch, 401 14th Street, NW., 2nd Floor, West Wing, 
Washington, DC 20227.

                             (End of clause)

    Alternate I (July 2000). As prescribed in 28.103-4, substitute the 
following paragraphs (b) and (d) for paragraphs (b) and (d) of the basic 
clause:

    (b) The Contractor shall furnish a performance bond (Standard Form 
1418) for the protection to the Government in an amount equal to ---- 
percent of the original contract price.
    (d) The Government may require additional performance bond 
protection if the contract price is increased. The Government may secure 
the additional protection by directing the Contractor to increase the 
penal amount of the existing bond or to obtain an additional bond.

[61 FR 39214, July 26, 1996, as amended at 65 FR 46071, July 26, 2000]



Sec.  52.229-1  State and Local Taxes.

    As prescribed in 29.401-1, insert the following clause:

                    State and Local Taxes (APR 1984)

    Notwithstanding the terms of the Federal, State, and Local Taxes 
clause, the contract price excludes all State and local taxes levied on 
or measured by the contract or sales price of the services or completed 
supplies furnished under this contract. The Contractor shall state 
separately on its invoices taxes excluded from the contract price, and 
the Government agrees either to pay the amount of the taxes to the 
Contractor or provide evidence necessary to sustain an exemption.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 68 FR 28086, May 22, 2003]



Sec.  52.229-2  North Carolina State and Local Sales and Use Tax.

    As prescribed in 29.401-2, insert the following clause in 
solicitations and contracts for construction to be performed in North 
Carolina:

       North Carolina State and Local Sales and Use Tax (APR 1984)

    (a) Materials, as used in this clause, means building materials, 
supplies, fixtures, and equipment that become a part of or are annexed 
to any building or structure erected, altered, or repaired under this 
contract.
    (b) If this is a fixed-price contract, the contract price includes 
North Carolina State and local sales and use taxes to be paid on 
materials, notwithstanding any other provision of this contract. If this 
is a cost-reimbursement contract, any North Carolina State and local 
sales and use taxes paid by the Contractor on materials shall constitute 
an allowable cost under this contract.
    (c) At the time specified in paragraph (d) below, the Contractor 
shall furnish the Contracting Officer certified statements setting forth 
the cost of the materials purchased from each vendor and the amount of 
North Carolina State and local sales and use taxes paid. In the event 
the Contractor makes several purchases from the same vendor, the 
certified statement shall indicate the invoice numbers, the inclusive 
dates of the invoices, the total amount of the invoices, and the North 
Carolina State and local sales and use taxes paid. The statement shall 
also include the cost of any tangible personal property withdrawn from 
the Contractor's warehouse stock and the amount of North Carolina State 
and local sales or use tax paid on this property by the Contractor. Any 
local sales

[[Page 209]]

or use taxes included in the Contractor's statements must be shown 
separately from the State sales or use taxes. The Contractor shall 
furnish any additional information the Commissioner of Revenue of the 
State of North Carolina may require to substantiate a refund claim for 
sales or use taxes. The Contractor shall also obtain and furnish to the 
Contracting Officer similar certified statements by its subcontractors.
    (d) If this contract is completed before the next October 1, the 
certified statements to be furnished pursuant to paragraph (c) above 
shall be submitted within 60 days after completion. If this contract is 
not completed before the next October 1, the certified statements shall 
be submitted on or before November 30 of each year and shall cover taxes 
paid during the 12-month period that ended the preceding September 30.
    (e) The certified statements to be furnished pursuant to paragraph 
(c) above shall be in the following form:

I hereby certify that during the period ---- to ---- [insert dates], --
---- [insert name of Contractor or subcontractor] paid North Carolina 
State and local sales and use taxes aggregating $---- (State) and $---- 
(local), with respect to building materials, supplies, fixtures, and 
equipment that have become a part of or annexed to a building or 
structure erected, altered, or repaired by ------ [insert name of 
Contractor or subcontractor] for the United States of America, and that 
the vendors from whom the property was purchased, the dates and numbers 
of the invoices covering the purchases, the total amount of the invoices 
of each vendor, the North Carolina State and local sales and use taxes 
paid on the property (shown separately), and the cost of property 
withdrawn from warehouse stock and North Carolina State and local sales 
or use taxes paid on this property are as set forth in the attachments.

                             (End of clause)

    Alternate I (APR 1984). If the requirement is for vessel repair to 
be performed in North Carolina, substitute the following paragraph (a) 
for paragraph (a) of the basic clause:

    (a) Materials, as used in this clause, means materials, supplies, 
fixtures, and equipment that become a part of or are annexed to any 
vessel altered or repaired under this contract.

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 1747, Jan. 11, 1985; 
50 FR 52429, Dec. 23, 1985]



Sec.  52.229-3  Federal, State, and Local Taxes.

    As prescribed in 29.401-3, insert the following clause:

              Federal, State, and Local Taxes (April 2003)

    (a) As used in this clause--
    After-imposed Federal tax means any new or increased Federal excise 
tax or duty, or tax that was exempted or excluded on the contract date 
but whose exemption was later revoked or reduced during the contract 
period, on the transactions or property covered by this contract that 
the Contractor is required to pay or bear as the result of legislative, 
judicial, or administrative action taking effect after the contract 
date. It does not include social security tax or other employment taxes.
    After-relieved Federal tax means any amount of Federal excise tax or 
duty, except social security or other employment taxes, that would 
otherwise have been payable on the transactions or property covered by 
this contract, but which the Contractor is not required to pay or bear, 
or for which the Contractor obtains a refund or drawback, as the result 
of legislative, judicial, or administrative action taking effect after 
the contract date.
    All applicable Federal, State, and local taxes and duties means all 
taxes and duties, in effect on the contract date, that the taxing 
authority is imposing and collecting on the transactions or property 
covered by this contract.
    Contract date means the date set for bid opening or, if this is a 
negotiated contract or a modification, the effective date of this 
contract or modifiation.
    Local taxes includes taxes imposed by a possession or territory of 
the United States, Puerto Rico, or the Northern Mariana Islands, if the 
contract is performed wholly or partly in any of those areas.
    (b) The contract price includes all applicable Federal, State, and 
local taxes and duties.
    (c) The contract price shall be increased by the amount of any 
after-imposed Federal tax, provided the Contractor warrants in writing 
that no amount for such newly imposed Federal excise tax or duty or rate 
increase was included in the contract price, as a contingency reserve or 
otherwise.
    (d) The contract price shall be decreased by the amount of any 
after-relieved Federal tax.
    (e) The contract price shall be decreased by the amount of any 
Federal excise tax or duty, except social security or other employment 
taxes, that the Contractor is required to pay or bear, or does not 
obtain a refund of, through the Contractor's fault, negligence, or 
failure to follow instructions of the Contracting Officer.
    (f) No adjustment shall be made in the contract price under this 
clause unless the amount of the adjustment exceeds $250.

[[Page 210]]

    (g) The Contractor shall promptly notify the Contracting Officer of 
all matters relating to any Federal excise tax or duty that reasonably 
may be expected to result in either an increase or decrease in the 
contract price and shall take appropriate action as the Contracting 
Officer directs.
    (h) The Government shall, without liability, furnish evidence 
appropriate to establish exemption from any Federal, State, or local tax 
when the Contractor requests such evidence and a reasonable basis exists 
to sustain the exemption.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 1747, Jan. 11, 1985; 
50 FR 52429, Dec. 23, 1985; 55 FR 52799, Dec. 21, 1990; 68 FR 13205, 
Mar. 18, 2003]



Sec.  52.229-4  Federal, State, and Local Taxes (State and Local Adjustments).

    As prescribed in 29.401-3, insert the following clause:

  Federal, State, and Local Taxes (State and Local Adjustments) (April 
                                  2003)

    (a) As used in this clause--
    After-imposed tax means any new or increased Federal, State, or 
local tax or duty, or tax that was excluded on the contract date but 
whose exclusion was later revoked or amount of exemption reduced during 
the contract period, other than an excepted tax, on the transactions or 
property covered by this contract that the Contractor is required to pay 
or bear as the result of legislative, judicial, or administrative action 
taking effect after the contract date.
    After-relieved tax means any amount of Federal, State, or local tax 
or duty, other than an excepted tax, that would otherwise have been 
payable on the transactions or property covered by this contract, but 
which the Contractor is not required to pay or bear, or for which the 
Contractor obtains a refund or drawback, as the result of legislative, 
judicial, or administrative action taking effect after the contract 
date.
    All applicable Federal, State, and local taxes and duties means all 
taxes and duties, in effect on the contract date, that the taxing 
authority is imposing and collecting on the transactions or property 
covered by this contract.
    Contract date means the effective date of this contract and, for any 
modification to this contract, the effective date of the modification.
    Excepted tax means social security or other employment taxes, net 
income and franchise taxes, excess profits taxes, capital stock taxes, 
transportation taxes, unemployment compensation taxes, and property 
taxes. Excepted tax does not include gross income taxes levied on or 
measured by sales or receipts from sales, property taxes assessed on 
completed supplies covered by this contract, or any tax assessed on the 
Contractor's possession of, interest in, or use of property, title to 
which is in the Government.
    Local taxes includes taxes imposed by a possession or territory of 
the United States, Puerto Rico, or the Northern Mariana Islands, if the 
contract is performed wholly or partly in any of those areas.
    (b) Unless otherwise provided in this contract, the contract price 
includes all applicable Federal, State, and local taxes and duties.
    (c) The contract price shall be increased by the amount of any 
after-imposed tax, or of any tax or duty specifically excluded from the 
contract price by a term or condition of this contract that the 
Contractor is required to pay or bear, including any interest or 
penalty, if the Contractor states in writing that the contract price 
does not include any contingency for such tax and if liability for such 
tax, interest, or penalty was not incurred through the Contractor's 
fault, negligence, or failure to follow instructions of the Contracting 
Officer.
    (d) The contract price shall be decreased by the amount of any 
after-relieved tax. The Government shall be entitled to interest 
received by the Contractor incident to a refund of taxes to the extent 
that such interest was earned after the Contractor was paid by the 
Government for such taxes. The Government shall be entitled to repayment 
of any penalty refunded to the Contractor to the extent that the penalty 
was paid by the Government.
    (e) The contract price shall be decreased by the amount of any 
Federal, State, or local tax, other than an excepted tax, that was 
included in the contract price and that the Contractor is required to 
pay or bear, or does not obtain a refund of, through the Contractor's 
fault, negligence, or failure to follow instructions of the Contracting 
Officer.
    (f) No adjustment shall be made in the contract price under this 
clause unless the amount of the adjustment exceeds $250.
    (g) The Contractor shall promptly notify the Contracting Officer of 
all matters relating to Federal, State, and local taxes and duties that 
reasonably may be expected to result in either an increase or decrease 
in the contract price and shall take appropriate action as the 
Contracting Officer directs. The contract price shall be equitably 
adjusted to cover the costs of action taken by the Contractor at the 
direction of the Contracting Officer, including any interest, penalty, 
and reasonable attorneys' fees.
    (h) The Government shall furnish evidence appropriate to establish 
exemption from any Federal, State, or local tax when (1) the Contractor 
requests such exemption and states

[[Page 211]]

in writing that it applies to a tax excluded from the contract price and 
(2) a reasonable basis exists to sustain the exemption.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 52799, Dec. 21, 1990; 
68 FR 13205, Mar. 18, 2003]



Sec.  52.229-5  [Reserved]



Sec.  52.229-6  Taxes--Foreign Fixed-Price Contracts.

    As prescribed in 29.402-1(a), insert the following clause:

            Taxes--Foreign Fixed-Price Contracts (June 2003)

    (a) To the extent that this contract provides for furnishing 
supplies or performing services outside the United States and its 
outlying areas, this clause applies in lieu of any Federal, State, and 
local taxes clause of the contract.
    (b) Definitions. As used in this clause--
    Contract date means the date set for bid opening or, if this is a 
negotiated contract or a modification, the effective date of this 
contract or modification.
    Country concerned means any country, other than the United States 
and its outlying areas, in which expenditures under this contract are 
made.
    Tax and taxes include fees and charges for doing business that are 
levied by the government of the country concerned or by its political 
subdivisions.
    All applicable taxes and duties means all taxes and duties, in 
effect on the contract date, that the taxing authority is imposing and 
collecting on the transactions or property covered by this contract, 
pursuant to written ruling or regulation in effect on the contract date.
    After-imposed tax means any new or increased tax or duty, or tax 
that was exempted or excluded on the contract date but whose exemption 
was later revoked or reduced during the contract period, other than 
excepted tax, on the transactions or property covered by this contract 
that the Contractor is required to pay or bear as the result of 
legislative, judicial, or administrative action taking effect after the 
contract date.
    After-relieved tax means any amount of tax or duty, other than an 
excepted tax, that would otherwise have been payable on the transactions 
or property covered by this contract, but which the Contractor is not 
required to pay or bear, or for which the Contractor obtains a refund, 
as the result of legislative, judicial, or administrative action taking 
effect after the contract date.
    Excepted tax means social security or other employment taxes, net 
income and franchise taxes, excess profits taxes, capital stock taxes, 
transportation taxes, unemployment compensation taxes, and property 
taxes. Excepted tax does not include gross income taxes levied on or 
measured by sales or receipts from sales, property taxes assessed on 
completed supplies covered by this contract, or any tax assessed on the 
Contractor's possession of, interest in, or use of property, title to 
which is in the U.S. Government.
    (c) Unless otherwise provided in this contract, the contract price 
includes all applicable taxes and duties, except taxes and duties that 
the Government of the United States and the government of the country 
concerned have agreed shall not be applicable to expenditures in such 
country by or on behalf of the United States.
    (d) The contract price shall be increased by the amount of any 
after-imposed tax or of any tax or duty specifically excluded from the 
contract price by a provision of this contract that the Contractor is 
required to pay or bear, including any interest or penalty, if the 
Contractor states in writing that the contract price does not include 
any contingency for such tax and if liability for such tax, interest, or 
penalty was not incurred through the Contractor's fault, negligence, or 
failure to follow instructions of the Contracting Officer or to comply 
with the provisions of paragraph (i) below.
    (e) The contract price shall be decreased by the amount of any 
after-relieved tax, including any interest or penalty. The Government of 
the United States shall be entitled to interest received by the 
Contractor incident to a refund of taxes to the extent that such 
interest was earned after the Contractor was paid by the Government of 
the United States for such taxes. The Government of the United States 
shall be entitled to repayment of any penalty refunded to the Contractor 
to the extent that the penalty was paid by the Government.
    (f) The contract price shall be decreased by the amount of any tax 
or duty, other than an excepted tax, that was included in the contract 
and that the Contractor is required to pay or bear, or does not obtain a 
refund of, through the Contractor's fault, negligence, or failure to 
follow instructions of the Contracting Officer or to comply with the 
provisions of paragraph (i) below.
    (g) No adjustment shall be made in the contract price under this 
clause unless the amount of the adjustment exceeds $250.
    (h) If the Contractor obtains a reduction in tax liability under the 
United States Internal Revenue Code (Title 26, U.S. Code) because of the 
payment of any tax or duty that either was included in the contract 
price or was the basis of an increase in the contract price, the amount 
of the reduction shall be paid or credited to the Government of the 
United States as the Contracting Officer directs.

[[Page 212]]

    (i) The Contractor shall take all reasonable action to obtain 
exemption from or refund of any taxes or duties, including interest or 
penalty, from which the United States Government, the Contractor, any 
subcontractor, or the transactions or property covered by this contract 
are exempt under the laws of the country concerned or its political 
subdivisions or which the governments of the United States and of the 
country concerned have agreed shall not be applicable to expenditures in 
such country by or on behalf of the United States.
    (j) The Contractor shall promptly notify the Contracting Officer of 
all matters relating to taxes or duties that reasonably may be expected 
to result in either an increase or decrease in the contract price and 
shall take appropriate action as the Contracting Officer directs. The 
contract price shall be equitably adjusted to cover the costs of action 
taken by the Contractor at the direction of the Contracting Officer, 
including any interest, penalty, and reasonable attorneys' fees.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 52799, Dec. 21, 1990; 
68 FR 28087, May 22, 2003]



Sec.  52.229-7  Taxes--Fixed-Price Contracts With Foreign Governments.

    As prescribed in 29.402-1(b), insert the following clause:

    Taxes--Fixed-Price Contracts With Foreign Governments (JAN 1991)

    (a) Contract date, as used in this clause, means the date set for 
bid opening or, if this is a negotiated contract or a modification, the 
effective date of this contract or modification.
    (b) The contract price, including the prices in any subcontracts 
under this contract, does not include any tax or duty that the 
Government of the United States and the Government of ---- [insert name 
of the foreign government] have agreed shall not apply to expenditures 
made by the United States in ---- [insert name of country], or any tax 
or duty not applicable to this contract or any subcontracts under this 
contract, pursuant to the laws of ---- [insert name of country]. If any 
such tax or duty has been included in the contract price, through error 
or otherwise, the contract price shall be correspondingly reduced.
    (c) If, after the contract date, the Government of the United States 
and the Government of ---- [insert name of the foreign government] agree 
that any tax or duty included in the contract price shall not apply to 
expenditures by the United States in ---- [insert name of country], the 
contract price shall be reduced accordingly.
    (d) No adjustment shall be made in the contract price under this 
clause unless the amount of the adjustment exceeds $250.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 52799, Dec. 21, 1990]



Sec.  52.229-8  Taxes--Foreign Cost-Reimbursement Contracts.

    As prescribed in 29.402-2(a), insert the following clause:

         Taxes--Foreign Cost-Reimbursement Contracts (MAR 1990)

    (a) Any tax or duty from which the United States Government is 
exempt by agreement with the Government of ---- [insert name of the 
foreign government], or from which the Contractor or any subcontractor 
under this contract is exempt under the laws of ---- [insert name of 
country], shall not constitute an allowable cost under this contract.
    (b) If the Contractor or subcontractor under this contract obtains a 
foreign tax credit that reduces its Federal income tax liability under 
the United States Internal Revenue Code (Title 26, U.S.C.) because of 
the payment of any tax or duty that was reimbursed under this contract, 
the amount of the reduction shall be paid or credited at the time of 
such offset to the Government of the United States as the Contracting 
Officer directs.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 3889, Feb. 5, 1990]



Sec.  52.229-9  Taxes--Cost-Reimbursement Contracts With Foreign Governments.

    As prescribed in 29.402-2(b), insert the following clause:

 Taxes--Cost-Reimbursement Contracts With Foreign Governments (MAR 1990)

    (a) Any tax or duty from which the United States Government is 
exempt by agreement with the Government of ---- [insert name of the 
foreign government], or from which any subcontractor under this contract 
is exempt under the laws of ---- [insert name of country], shall not 
constitute an allowable cost under this contract.
    (b) If any subcontractor obtains a foreign tax credit that reduces 
its Federal income tax liability under the United States Internal 
Revenue Code (Title 26, U.S.C.) because of the payment of any tax or 
duty that was reimbursed under this contract, the amount of the 
reduction shall be paid (not credited to the contract) to the Treasurer 
of the

[[Page 213]]

United States at the time the Federal income tax return is filed.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 3889, Feb. 5, 1990]



Sec.  52.229-10  State of New Mexico Gross Receipts and Compensating Tax.

    As prescribed in 29.401-4(b), insert the following clause:

  State of New Mexico Gross Receipts and Compensating Tax (April 2003)

    (a) Within thirty (30) days after award of this contract, the 
Contractor shall advise the State of New Mexico of this contract by 
registering with the State of New Mexico, Taxation and Revenue 
Department, Revenue Division, pursuant to the Tax Administration Act of 
the State of New Mexico and shall identify the contract number.
    (b) The Contractor shall pay the New Mexico gross receipts taxes, 
pursuant to the Gross Receipts and Compensating Tax Act of New Mexico, 
assessed against the contract fee and costs paid for performance of this 
contract, or of any part or portion thereof, within the State of New 
Mexico. The allowability of any gross receipts taxes or local option 
taxes lawfully paid to the State of New Mexico by the Contractor or its 
subcontractors will be determined in accordance with the Allowable Cost 
and Payment clause of this contract except as provided in paragraph (d) 
of this clause.
    (c) The Contractor shall submit applications for Nontaxable 
Transaction Certificates, Form CSR-3C, to the State of New Mexico 
Taxation and Revenue Department, Revenue Division, P.O. Box 630, Santa 
Fe, New Mexico 87509. When the Type 15 Nontaxable Transaction 
Certificate is issued by the Revenue Division, the Contractor shall use 
these certificates strictly in accordance with this contract, and the 
agreement between the (*----) and the New Mexico Taxation and Revenue 
Department.
    (d) The Contractor shall provide Type 15 Nontaxable Transaction 
Certificates to each vendor in New Mexico selling tangible personal 
property to the Contractor for use in the performance of this contract. 
Failure to provide a Type 15 Nontaxable Transaction Certificate to 
vendors will result in the vendor's liability for the gross receipt 
taxes and those taxes, which are then passed on to the Contractor, shall 
not be reimbursable as an allowable cost by the Government.
    (e) The Contractor shall pay the New Mexico compensating user tax 
for any tangible personal property which is purchased pursuant to a 
Nontaxable Transaction Certificate if such property is not used for 
Federal purposes.
    (f) Out-of-state purchase of tangible personal property by the 
Contractor which would be otherwise subject to compensation tax shall be 
governed by the principles of this clause. Accordingly, compensating tax 
shall be due from the Contractor only if such property is not used for 
Federal purposes.
    (g) The (*----) may receive information regarding the Contractor 
from the Revenue Division of the New Mexico Taxation and Revenue 
Department and, at the discretion of the (*----), may participate in any 
matters or proceedings pertaining to this clause or the above-mentioned 
agreement. This shall not preclude the Contractor from having its own 
representative nor does it obligate the (*----) to represent its 
Contractor.
    (h) The Contractor agrees to insert the substance of this clause, 
including this paragraph (h), in each subcontract which meets the 
criteria in 29.401-4(b) (1) through (3) of the Federal Acquisition 
Regulation, 48 CFR part 29.
    (i) Paragraphs (a) through (h) of this clause shall be null and void 
should the Agreement referred to in paragraph (c) of this clause be 
terminated; provided, however, that such termination shall not nullify 
obligations already incurred prior to the date of termination.

(*Insert appropriate agency name in blanks.)

                             (End of clause)

[53 FR 34229, Sept. 2, 1988; 53 FR 36028, Sept. 16, 1988, as amended at 
68 FR 13205, Mar. 18, 2003]



Sec.  52.230-1  Cost Accounting Standards Notices and Certification.

    As prescribed in 30.201-3, insert the following provisions:

     Cost Accounting Standards Notices and Certification (JUNE 2000)

    Note: This notice does not apply to small businesses or foreign 
governments. This notice is in three parts, identified by Roman numerals 
I through III.
    Offerors shall examine each part and provide the requested 
information in order to determine Cost Accounting Standards (CAS) 
requirements applicable to any resultant contract.
    If the offeror is an educational institution, Part II does not apply 
unless the contemplated contract will be subject to full or modified CAS 
coverage pursuant to 48 CFR 9903.201-2(c)(5) or 9903.201-2(c)(6), 
respectively.

  I. Disclosure Statement--Cost Accounting Practices and Certification

    (a) Any contract in excess of $500,000 resulting from this 
solicitation will be subject

[[Page 214]]

to the requirements of the Cost Accounting Standards Board (48 CFR 
Chapter 99), except for those contracts which are exempt as specified in 
48 CFR 9903.201-1.
    (b) Any offeror submitting a proposal which, if accepted, will 
result in a contract subject to the requirements of 48 CFR chapter 99 
must, as a condition of contracting, submit a Disclosure Statement as 
required by 48 CFR 9903.202. When required, the Disclosure Statement 
must be submitted as a part of the offeror's proposal under this 
solicitation unless the offeror has already submitted a Disclosure 
Statement disclosing the practices used in connection with the pricing 
of this proposal. If an applicable Disclosure Statement has already been 
submitted, the offeror may satisfy the requirement for submission by 
providing the information requested in paragraph (c) of Part I of this 
provision.
    CAUTION: In the absence of specific regulations or agreement, a 
practice disclosed in a Disclosure Statement shall not, by virtue of 
such disclosure, be deemed to be a proper, approved, or agreed-to 
practice for pricing proposals or accumulating and reporting contract 
performance cost data.
    (c) Check the appropriate box below:
    [squ] (1) Certificate of Concurrent Submission of Disclosure 
Statement. The offeror hereby certifies that, as a part of the offer, 
copies of the Disclosure Statement have been submitted as follows: (i) 
original and one copy to the cognizant Administrative Contracting 
Officer (ACO) or cognizant Federal agency official authorized to act in 
that capacity (Federal official), as applicable, and (ii) one copy to 
the cognizant Federal auditor.
    (Disclosure must be on Form No. CASB DS-1 or CASB DS-2, as 
applicable. Forms may be obtained from the cognizant ACO or Federal 
official and/or from the loose-leaf version of the Federal Acquisition 
Regulation.)

Date of Disclosure Statement:
________________________________________________________________________

Name and Address of Cognizant ACO or Federal Official Where Filed:

________________________________________________________________________

    The offeror further certifies that the practices used in estimating 
costs in pricing this proposal are consistent with the cost accounting 
practices disclosed in the Disclosure Statement.
    [squ] (2) Certificate of Previously Submitted Disclosure Statement. 
The offeror hereby certifies that the required Disclosure Statement was 
filed as follows:

Date of Disclosure Statement:
________________________________________________________________________

Name and Address of Cognizant ACO or Federal Official Where Filed:

________________________________________________________________________

    The offeror further certifies that the practices used in estimating 
costs in pricing this proposal are consistent with the cost accounting 
practices disclosed in the applicable Disclosure Statement.
    [squ] (3) Certificate of Monetary Exemption. The offeror hereby 
certifies that the offeror, together with all divisions, subsidiaries, 
and affiliates under common control, did not receive net awards of 
negotiated prime contracts and subcontracts subject to CAS totaling $50 
million or more in the cost accounting period immediately preceding the 
period in which this proposal was submitted. The offeror further 
certifies that if such status changes before an award resulting from 
this proposal, the offeror will advise the Contracting Officer 
immediately.
    [squ] (4) Certificate of Interim Exemption. The offeror hereby 
certifies that (i) the offeror first exceeded the monetary exemption for 
disclosure, as defined in (3) of this subsection, in the cost accounting 
period immediately preceding the period in which this offer was 
submitted and (ii) in accordance with 48 CFR 9903.202-1, the offeror is 
not yet required to submit a Disclosure Statement. The offeror further 
certifies that if an award resulting from this proposal has not been 
made within 90 days after the end of that period, the offeror will 
immediately submit a revised certificate to the Contracting Officer, in 
the form specified under subparagraph (c)(1) or (c)(2) of Part I of this 
provision, as appropriate, to verify submission of a completed 
Disclosure Statement.
    CAUTION: Offerors currently required to disclose because they were 
awarded a CAS-covered prime contract or subcontract of $50 million or 
more in the current cost accounting period may not claim this exemption 
(4). Further, the exemption applies only in connection with proposals 
submitted before expiration of the 90-day period following the cost 
accounting period in which the monetary exemption was exceeded.

    II. Cost Accounting Standards--Eligibility for Modified Contract 
                                Coverage

    If the offeror is eligible to use the modified provisions of 48 CFR 
9903.201-2(b) and elects to do so, the offeror shall indicate by 
checking the box below. Checking the box below shall mean that the 
resultant contract is subject to the Disclosure and Consistency of Cost 
Accounting Practices clause in lieu of the Cost Accounting Standards 
clause.
    [squ] The offeror hereby claims an exemption from the Cost 
Accounting Standards clause under the provisions of 48 CFR 9903.201-2(b) 
and certifies that the offeror is eligible for use of the Disclosure and 
Consistency of Cost Accounting Practices clause because during the cost 
accounting period immediately preceding the period in which this 
proposal was submitted, the offeror received less than $50

[[Page 215]]

million in awards of CAS-covered prime contracts and subcontracts. The 
offeror further certifies that if such status changes before an award 
resulting from this proposal, the offeror will advise the Contracting 
Officer immediately.
    CAUTION: An offeror may not claim the above eligibility for modified 
contract coverage if this proposal is expected to result in the award of 
a CAS-covered contract of $50 million or more or if, during its current 
cost accounting period, the offeror has been awarded a single CAS-
covered prime contract or subcontract of $50 million or more.

    III. Additional Cost Accounting Standards Applicable to Existing 
                                Contracts

    The offeror shall indicate below whether award of the contemplated 
contract would, in accordance with subparagraph (a)(3) of the Cost 
Accounting Standards clause, require a change in established cost 
accounting practices affecting existing contracts and subcontracts.
    [squ] Yes [squ] No

                           (End of provision)

    Alternate I (APR 1996). As prescribed in 30.201-3(b), add the 
following subparagraph (c)(5) to Part I of the basic provision:

    [squ] (5) Certificate of Disclosure Statement Due Date by 
Educational Institution. If the offeror is an educational institution 
that, under the transition provisions of 48 CFR 9903.202-1(f), is or 
will be required to submit a Disclosure Statement after receipt of this 
award, the offeror hereby certifies that (check one and complete):

    [squ] (i) A Disclosure Statement Filing Due Date of ----------------
-- has been established with the cognizant Federal agency.

     (ii) The Disclosure Statement will be submitted within the 6-month 
period ending -------------- months after receipt of this award.
Name and Address of Cognizant ACO or Federal Official Where Disclosure 
Statement is to be Filed:
________________________________________________________________________

[57 FR 39591, Aug. 31, 1992; 57 FR 43409, 43495, Sept. 21, 1992, as 
amended at 59 FR 67043, Dec. 28, 1994; 61 FR 18918, Apr. 29, 1996; 63 FR 
9061, Feb. 23, 1998; 65 FR 36030, June 6, 2000]



Sec.  52.230-2  Cost Accounting Standards.

    As prescribed in 30.201-4(a), insert the following clause:

                  Cost Accounting Standards (APR 1998)

    (a) Unless the contract is exempt under 48 CFR 9903.201-1 and 
9903.201-2, the provisions of 48 CFR part 9903 are incorporated herein 
by reference and the Contractor, in connection with this contract, 
shall--
    (1) (CAS-covered Contracts Only) By submission of a Disclosure 
Statement, disclose in writing the Contractor's cost accounting 
practices as required by 48 CFR 9903.202-1 through 9903.202-5, including 
methods of distinguishing direct costs from indirect costs and the basis 
used for allocating indirect costs. The practices disclosed for this 
contract shall be the same as the practices currently disclosed and 
applied on all other contracts and subcontracts being performed by the 
Contractor and which contain a Cost Accounting Standards (CAS) clause. 
If the Contractor has notified the Contracting Officer that the 
Disclosure Statement contains trade secrets and commercial or financial 
information which is privileged and confidential, the Disclosure 
Statement shall be protected and shall not be released outside of the 
Government.
    (2) Follow consistently the Contractor's cost accounting practices 
in accumulating and reporting contract performance cost data concerning 
this contract. If any change in cost accounting practices is made for 
the purposes of any contract or subcontract subject to CAS requirements, 
the change must be applied prospectively to this contract and the 
Disclosure Statement must be amended accordingly. If the contract price 
or cost allowance of this contract is affected by such changes, 
adjustment shall be made in accordance with subparagraph (a)(4) or 
(a)(5) of this clause, as appropriate.
    (3) Comply with all CAS, including any modifications and 
interpretations indicated thereto contained in 48 CFR part 9904 in 
effect on the date of award of this contract or, if the Contractor has 
submitted cost or pricing data, on the date of final agreement on price 
as shown on the Contractor's signed certificate of current cost or 
pricing data. The Contractor shall also comply with any CAS (or 
modifications to CAS) which hereafter become applicable to a contract or 
subcontract of the Contractor. Such compliance shall be required 
prospectively from the date of applicability to such contract or 
subcontract.
    (4)(i) Agree to an equitable adjustment as provided in the Changes 
clause of this contract if the contract cost is affected by a change 
which, pursuant to subparagraph (a)(3) of this clause, the Contractor is 
required to make to the Contractor's established cost accounting 
practices.
    (ii) Negotiate with the Contracting Officer to determine the terms 
and conditions under which a change may be made to a cost accounting 
practice, other than a change made under other provisions of 
subparagraph (a)(4) of this clause; provided that no agreement may be 
made under this provision that will increase costs paid by the United 
States.

[[Page 216]]

    (iii) When the parties agree to a change to a cost accounting 
practice, other than a change under subdivision (a)(4)(i) of this 
clause, negotiate an equitable adjustment as provided in the Changes 
clause of this contract.
    (5) Agree to an adjustment of the contract price or cost allowance, 
as appropriate, if the Contractor or a subcontractor fails to comply 
with an applicable Cost Accounting Standard, or to follow any cost 
accounting practice consistently and such failure results in any 
increased costs paid by the United States. Such adjustment shall provide 
for recovery of the increased costs to the United States, together with 
interest thereon computed at the annual rate established under section 
6621 of the Internal Revenue Code of 1986 (26 U.S.C. 6621) for such 
period, from the time the payment by the United States was made to the 
time the adjustment is effected. In no case shall the Government recover 
costs greater than the increased cost to the Government, in the 
aggregate, on the relevant contracts subject to the price adjustment, 
unless the Contractor made a change in its cost accounting practices of 
which it was aware or should have been aware at the time of price 
negotiations and which it failed to disclose to the Government.
    (b) If the parties fail to agree whether the Contractor or a 
subcontractor has complied with an applicable CAS in 48 CFR part 9904 or 
a CAS rule or regulation in 48 CFR part 9903 and as to any cost 
adjustment demanded by the United States, such failure to agree will 
constitute a dispute under the Contract Disputes Act (41 U.S.C. 601).
    (c) The Contractor shall permit any authorized representatives of 
the Government to examine and make copies of any documents, papers, or 
records relating to compliance with the requirements of this clause.
    (d) The Contractor shall include in all negotiated subcontracts 
which the Contractor enters into, the substance of this clause, except 
paragraph (b), and shall require such inclusion in all other 
subcontracts, of any tier, including the obligation to comply with all 
CAS in effect on the subcontractor's award date or if the subcontractor 
has submitted cost or pricing data, on the date of final agreement on 
price as shown on the subcontractor's signed Certificate of Current Cost 
or Pricing Data. If the subcontract is awarded to a business unit which 
pursuant to 48 CFR 9903.201-2 is subject to other types of CAS coverage, 
the substance of the applicable clause set forth in subsection 30.201-4 
of the Federal Acquisition Regulation shall be inserted. This 
requirement shall apply only to negotiated subcontracts in excess of 
$500,000, except that the requirement shall not apply to negotiated 
subcontracts otherwise exempt from the requirement to include a CAS 
clause as specified in 48 CFR 9903.201-1.

                             (End of clause)

[57 FR 39592, Aug. 31, 1992; 57 FR 45878, Oct. 5, 1992, as amended at 61 
FR 18919, Apr. 29, 1996; 63 FR 9054, Feb. 23, 1998]



Sec.  52.230-3  Disclosure and Consistency of Cost Accounting Practices.

    As prescribed in 30.201-4(b)(1), insert the following clause:

   Disclosure and Consistency of Cost Accounting Practices (APR 1998)

    (a) The Contractor, in connection with this contract, shall--
    (1) Comply with the requirements of 48 CFR 9904.401, Consistency in 
Estimating, Accumulating, and Reporting Costs; 48 CFR 9904.402, 
Consistency in Allocating Costs Incurred for the Same Purpose; 48 CFR 
9904.405, Accounting for Unallowable Costs; and 48 CFR 9904.406, Cost 
Accounting Standard-Cost Accounting Period, in effect on the date of 
award of this contract as indicated in 48 CFR part 9904.
    (2) (CAS-covered Contracts Only) If it is a business unit of a 
company required to submit a Disclosure Statement, disclose in writing 
its cost accounting practices as required by 48 CFR 9903.202-1 through 
9903.202-5. If the Contractor has notified the Contracting Officer that 
the Disclosure Statement contains trade secrets and commercial or 
financial information which is privileged and confidential, the 
Disclosure Statement shall be protected and shall not be released 
outside of the Government.
    (3)(i) Follow consistently the Contractor's cost accounting 
practices. A change to such practices may be proposed, however, by 
either the Government or the Contractor, and the Contractor agrees to 
negotiate with the Contracting Officer the terms and conditions under 
which a change may be made. After the terms and conditions under which 
the change is to be made have been agreed to, the change must be applied 
prospectively to this contract, and the Disclosure Statement, if 
affected, must be amended accordingly.
    (ii) The Contractor shall, when the parties agree to a change to a 
cost accounting practice and the Contracting Officer has made the 
finding required in 48 CFR 9903.201-6(b), that the change is desirable 
and not detrimental to the interests of the Government, negotiate an 
equitable adjustment as provided in the Changes clause of this contract. 
In the absence of the required finding, no agreement may be made under 
this contract clause that will increase costs paid by the United States.
    (4) Agree to an adjustment of the contract price or cost allowance, 
as appropriate, if the Contractor or a subcontractor fails to comply 
with the applicable CAS or to follow any

[[Page 217]]

cost accounting practice, and such failure results in any increased 
costs paid by the United States. Such adjustment shall provide for 
recovery of the increased costs to the United States together with 
interest thereon computed at the annual rate of interest established 
under the Internal Revenue Code of 1986 (26 U.S.C. 6621), from the time 
the payment by the United States was made to the time the adjustment is 
effected.
    (b) If the parties fail to agree whether the Contractor has complied 
with an applicable CAS, rule, or regulation as specified in 48 CFR parts 
9903 and 9904 and as to any cost adjustment demanded by the United 
States, such failure to agree will constitute a dispute under the 
Contract Disputes Act (41 U.S.C. 601).
    (c) The Contractor shall permit any authorized representatives of 
the Government to examine and make copies of any documents, papers, and 
records relating to compliance with the requirements of this clause.
    (d) The Contractor shall include in all negotiated subcontracts, 
which the Contractor enters into, the substance of this clause, except 
paragraph (b), and shall require such inclusion in all other 
subcontracts of any tier, except that--
    (1) If the subcontract is awarded to a business unit which pursuant 
to 48 CFR 9903.201-2 is subject to other types of CAS coverage, the 
substance of the applicable clause set forth in subsection 30.201-4 of 
the Federal Acquisition Regulation shall be inserted.
    (2) This requirement shall apply only to negotiated subcontracts in 
excess of $500,000.
    (3) The requirement shall not apply to negotiated subcontracts 
otherwise exempt from the requirement to include a CAS clause as 
specified in 48 CFR 9903.201-1.

                             (End of clause)

[57 FR 39592, Aug. 31, 1992; 57 FR 43495, Sept. 21, 1992, as amended at 
59 FR 67044, Dec. 28, 1994; 61 FR 18919, Apr. 29, 1996; 63 FR 9054, Feb. 
23, 1998]



Sec.  52.230-4  Consistency in Cost Accounting Practices.

    As prescribed in 30.201-4(c), insert the following clause:

           Consistency in Cost Accounting Practices (AUG 1992)

    The Contractor agrees that it will consistently follow the cost 
accounting practices disclosed on Form CASB DS-1 in estimating, 
accumulating and reporting costs under this contract. In the event the 
Contractor fails to follow such practices, it agrees that the contract 
price shall be adjusted, together with interest, if such failure results 
in increased cost paid by the U.S. Government. Interest shall be 
computed at the annual rate of interest established under section 6621 
of the Internal Revenue Code of 1986 (26 U.S.C. 6621) from the time 
payment by the Government was made to the time adjustment is effected. 
The Contractor agrees that the Disclosure Statement filed with the U.K. 
Ministry of Defence shall be available for inspection and use by 
authorized representatives of the United States Government.

                             (End of clause)

[57 FR 39593, Aug. 31, 1992]



Sec.  52.230-5  Cost Accounting Standards--Educational Institution.

    As prescribed in 30.201-4(e), insert the following clause:

      Cost Accounting Standards--Educational Institution (APR 1998)

    (a) Unless the contract is exempt under 48 CFR 9903.201-1 and 
9903.201-2, the provisions of 48 CFR part 9903 are incorporated herein 
by reference and the Contractor, in connection with this contract, 
shall--
    (1) (CAS-covered contracts only). If a business unit of an 
educational institution required to submit a Disclosure Statement, 
disclose in writing the Contractor's cost accounting practices as 
required by 48 CFR 9903.202-1 through 9903.202-5, including methods of 
distinguishing direct costs from indirect costs and the basis used for 
accumulating and allocating indirect costs. The practices disclosed for 
this contract shall be the same as the practices currently disclosed and 
applied on all other contracts and subcontracts being performed by the 
Contractor and which contain a Cost Accounting Standards (CAS) clause. 
If the Contractor has notified the Contracting Officer that the 
Disclosure Statement contains trade secrets, and commercial or financial 
information which is privileged and confidential, the Disclosure 
Statement shall be protected and shall not be released outside of the 
Government.
    (2) Follow consistently the Contractor's cost accounting practices 
in accumulating and reporting contract performance cost data concerning 
this contract. If any change in cost accounting practices is made for 
the purposes of any contract or subcontract subject to CAS requirements, 
the change must be applied prospectively to this contract and the 
Disclosure Statement, if required, must be amended accordingly. If an 
accounting principle change mandated under Office of Management and 
Budget (OMB) Circular A-21, Cost Principles for Educational 
Institutions, requires that a change in the Contractor's cost accounting 
practices be made after the date of this contract award, the change must 
be applied prospectively to this contract and the Disclosure Statement, 
if required, must be amended accordingly. If the

[[Page 218]]

contract price or cost allowance of this contract is affected by such 
changes, adjustment shall be made in accordance with subparagraph (a)(4) 
or (a)(5) of this clause, as appropriate.
    (3) Comply with all CAS, including any modifications and 
interpretations indicated thereto contained in 48 CFR part 9905 in 
effect on the date of award of this contract or, if the Contractor has 
submitted cost or pricing data, on the date of final agreement on price 
as shown on the Contractor's signed certificate of current cost or 
pricing data. The Contractor shall also comply with any CAS (or 
modifications to CAS) which hereafter become applicable to a contract or 
subcontract of the Contractor. Such compliance shall be required 
prospectively from the date of applicability to such contract or 
subcontract.
    (4)(i) Agree to an equitable adjustment as provided in the Changes 
clause of this contract if the contract cost is affected by a change 
which, pursuant to subparagraph (a)(3) of this clause, the Contractor is 
required to make to the Contractor's established cost accounting 
practices.
    (ii) Negotiate with the Contracting Officer to determine the terms 
and conditions under which a change may be made to a cost accounting 
practice, other than a change made under other provisions of 
subparagraph (a)(4) of this clause; provided that no agreement may be 
made under this provision that will increase costs paid by the United 
States.
    (iii) When the parties agree to a change to a cost accounting 
practice, other than a change under subdivision (a)(4)(i) or (a)(4)(iv) 
of this clause, negotiate an equitable adjustment as provided in the 
Changes clause of this contract.
    (iv) Agree to an equitable adjustment as provided in the Changes 
clause of this contract, if the contract cost is materially affected by 
an OMB Circular A-21 accounting principle amendment which, on becoming 
effective after the date of contract award, requires the Contractor to 
make a change to the Contractor's established cost accounting practices.
    (5) Agree to an adjustment of the contract price or cost allowance, 
as appropriate, if the Contractor or a subcontractor fails to comply 
with an applicable Cost Accounting Standard, or to follow any cost 
accounting practice consistently and such failure results in any 
increased costs paid by the United States. Such adjustment shall provide 
for recovery of the increased costs to the United States, together with 
interest thereon computed at the annual rate established under section 
6621 of the Internal Revenue Code of 1986 (26 U.S.C. 6621) for such 
period, from the time the payment by the United States was made to the 
time the adjustment is effected. In no case shall the Government recover 
costs greater than the increased cost to the Government, in the 
aggregate, on the relevant contracts subject to the price adjustment, 
unless the Contractor made a change in its cost accounting practices of 
which it was aware or should have been aware at the time of price 
negotiations and which it failed to disclose to the Government.
    (b) If the parties fail to agree whether the Contractor or a 
subcontractor has complied with an applicable CAS or a CAS rule or 
regulation in 48 CFR part 9903, and as to any cost adjustment demanded 
by the United States, such failure to agree will constitute a dispute 
under the Contract Disputes Act (41 U.S.C. 601).
    (c) The Contractor shall permit any authorized representatives of 
the Government to examine and make copies of any documents, papers, or 
records relating to compliance with the requirements of this clause.
    (d) The Contractor shall include in all negotiated subcontracts 
which the Contractor enters into, the substance of this clause, except 
paragraph (b), and shall require such inclusion in all other 
subcontracts, of any tier, including the obligation to comply with all 
applicable CAS in effect on the subcontractor's award date or, if the 
subcontractor has submitted cost or pricing data, on the date of final 
agreement on price as shown on the subcontractor's signed Certificate of 
Current Cost or Pricing Data, except that--
    (1) If the subcontract is awarded to a business unit which pursuant 
to 48 CFR 9903.201-2 is subject to other types of CAS coverage, the 
substance of the applicable clause set forth in 48 CFR 9903.201-4 shall 
be inserted;
    (2) This requirement shall apply only to negotiated subcontracts in 
excess of $500,000; and
    (3) The requirement shall not apply to negotiated subcontracts 
otherwise exempt from the requirement to include a CAS clause as 
specified in 48 CFR 9903.201-1.

                             (End of clause)

[61 FR 18919, Apr. 29, 1996, as amended at 63 FR 9061, Feb. 23, 1998]



Sec.  52.230-6  Administration of Cost Accounting Standards.

    As prescribed in 30.201-4(d)(1), insert the following clause:

         Administration of Cost Accounting Standards (APR 1996)

    For the purpose of administering the Cost Accounting Standards (CAS) 
requirements under this contract, the Contractor shall take the steps 
outlined in paragraphs (a) through (g) of this clause:
    (a) Submit to the Contracting Officer a description of any cost 
accounting practice change, the total potential impact of the change on 
contracts containing a CAS

[[Page 219]]

clause, and a general dollar magnitude of the change which identifies 
the potential shift of costs between CAS-covered contracts by contract 
type (i.e., firm-fixed-price, incentive, cost-plus-fixed fee, etc.) and 
other contractor business activity. As related to CAS-covered contracts, 
the analysis should identify the potential impact on funds of the 
various Agencies/Departments (i.e., Department of Energy, National 
Aeronautics and Space Administration, Army, Navy, Air Force, other 
Department of Defense, other Government) as follows:
    (1) For any change in cost accounting practices required in 
accordance with subparagraph (a)(3) and subdivision (a)(4)(i) of the 
clause at FAR 52.230-2, Cost Accounting Standards; or subparagraph 
(a)(3) and subdivisions (a)(4)(i) or (a)(4)(iv) of the clause at FAR 
52.230-5, Cost Accounting Standards--Educational Institution; within 60 
days (or such other date as may be mutually agreed to) after award of a 
contract requiring this change.
    (2) For any change in cost accounting practices proposed in 
accordance with subdivision (a)(4) (ii) or (iii) of the clauses at FAR 
52.230-2, Cost Accounting Standards, and FAR 52.230-5, Cost Accounting 
Standards--Educational Institution; or with subparagraph (a)(3) of the 
clause at FAR 52.230-3, Disclosure and Consistency of Cost Accounting 
Practices, not less than 60 days (or such other date as may be mutually 
agreed to) before the effective date of the proposed change.
    (3) For any failure to comply with an applicable CAS or to follow a 
disclosed practice (as contemplated by subparagraph (a)(5) at FAR 
52.230-2, Cost Accounting Standards, and FAR 52.230-5, Cost Accounting 
Standards--Educational Institution; or by subparagraph (a)(4) at FAR 
52.230-3, Disclosure and Consistency of Cost Accounting Practice):
    (i) Within 60 days (or such other date as may be mutually agreed to) 
after the date of agreement with the initial finding of noncompliance, 
or
    (ii) In the event of Contractor disagreement with the initial 
finding of noncompliance, within 60 days of the date the Contractor is 
notified by the Contracting Officer of the determination of 
noncompliance.
    (b) After an ACO, or cognizant Federal agency official, 
determination of materiality, submit a cost impact proposal in the form 
and manner specified by the Contracting Officer within 60 days (or such 
other date as may be mutually agreed to) after the date of determination 
of the adequacy and compliance of a change submitted pursuant to 
paragraph (a) of this clause. The cost impact proposal shall be in 
sufficient detail to permit evaluation, determination, and negotiation 
of the cost impact upon each separate CAS-covered contract and 
subcontract.
    (1) Cost impact proposals submitted for changes in cost accounting 
practices required in accordance with subparagraph (a)(3) and 
subdivision (a)(4)(i) of the clause at FAR 52.230-2, Cost Accounting 
Standards; or subparagraph (a)(3) and subdivisions (a)(4)(i) or 
(a)(4)(iv) of the clause at FAR 52.230-5, Cost Accounting Standards--
Educational Institution; shall identify the applicable standard or cost 
principle and all contracts and subcontracts containing the clauses 
entitled Cost Accounting Standards or Cost Accounting Standards--
Educational Institution, which have an award date before the effective 
date of that standard or cost principle.
    (2) Cost impact proposals submitted for any change in cost 
accounting practices proposed in accordance with subdivisions (a)(4) 
(ii) or (iii) of the clauses at FAR 52.230-2, Cost Accounting Standards, 
and FAR 52.230-5, Cost Accounting Standards--Educational Institution; or 
with subparagraph (a)(3) of the clause at FAR 52.230-3, Disclosure and 
Consistency of Cost Accounting Practices; shall identify all contracts 
and subcontracts containing the clauses at FAR 52.230-2, Cost Accounting 
Standards, FAR 52.230-5, Cost Accounting Standards--Educational 
Institution, and FAR 52.230-3, Disclosure and Consistency of Cost 
Accounting Practices.
    (3) Cost impact proposals submitted for failure to comply with an 
applicable CAS or to follow a disclosed practice as contemplated by 
subparagraph (a)(5) of the clauses at FAR 52.230-2, Cost Accounting 
Standards, and FAR 52.230-5, Cost Accounting Standards--Educational 
Institution; or by subparagraph (a)(4) of the clause at FAR 52.230-3, 
Disclosure and Consistency of Cost Accounting Practices, shall identify 
the cost impact on each separate CAS covered contract from the date of 
failure to comply until the noncompliance is corrected.
    (c) If the submissions required by paragraphs (a) and (b) of this 
clause are not submitted within the specified time, or any extension 
granted by the Contracting Officer, an amount not to exceed 10 percent 
of each subsequent amount determined payable related to the Contractor's 
CAS-covered prime contracts, up to the estimated general dollar 
magnitude of the cost impact, may be withheld until such time as the 
required submission has been provided in the form and manner specified 
by the Contracting Officer.
    (d) Agree to appropriate contract and subcontract amendments to 
reflect adjustments established in accordance with subparagraphs (a)(4) 
and (a)(5) of the clauses at FAR 52.230-2 and 52.230-5; or with 
subparagraphs (a)(3) or (a)(4) of the Disclosure and Consistency of Cost 
Accounting Practices clause at FAR 52.230-3.
    (e) For all subcontracts subject to the clauses at FAR 52.230-2, 
52.230-3, or 52.230-5--

[[Page 220]]

    (1) So state in the body of the subcontract, in the letter of award, 
or in both (self-deleting clauses shall not be used); and
    (2) Include the substance of this clause in all negotiated 
subcontracts. In addition, within 30 days after award of the 
subcontract, submit the following information to the Contractor's 
cognizant contract administration office for transmittal to the contract 
administrative office cognizant of the subcontractor's facility:
    (i) Subcontractor's name and subcontract number.
    (ii) Dollar amount and date of award.
    (iii) Name of Contractor making the award.
    (iv) Any changes the subcontractor has made or proposes to make to 
cost accounting practices that affect prime contracts or subcontracts 
containing the clauses at FAR 52.230-2, 52.230-3, or 52.230-5, unless 
these changes have already been reported. If award of the subcontract 
results in making one or more CAS effective for the first time, this 
fact shall also be reported.
    (f) Notify the Contracting Officer in writing of any adjustments 
required to subcontracts under this contract and agree to an adjustment, 
based on them, to this contract price or estimated cost and fee. This 
notice is due within 30 days after proposed subcontract adjustments are 
received and shall include a proposal for adjusting the higher tier 
subcontract or the prime contract appropriately.
    (g) For subcontracts containing the clauses at FAR 52.230-2 or 
52.230-5, require the subcontractor to comply with all Standards in 
effect on the date of award or of final agreement on price, as shown on 
the subcontractor's signed Certificate of Current Cost or Pricing Data, 
whichever is earlier.

                             (End of clause)

[57 FR 39593, Aug. 31, 1992; 57 FR 43495, Sept. 21, 1992, as amended at 
59 FR 67044, Dec. 28, 1994. Redesignated and amended at 61 FR 18919, 
18920, Apr. 29, 1996]



Sec.  52.231  [Reserved]



Sec.  52.232-1  Payments.

    As prescribed in 32.111(a)(1), insert the following clause, 
appropriately modified with respect to payment due date in accordance 
with agency regulations, in solicitations and contracts when a fixed-
price supply contract, a fixed-price service contract, or a contract for 
nonregulated communication services is contemplated:

                           Payments (APR 1984)

    The Government shall pay the Contractor, upon the submission of 
proper invoices or vouchers, the prices stipulated in this contract for 
supplies delivered and accepted or services rendered and accepted, less 
any deductions provided in this contract. Unless otherwise specified in 
this contract, payment shall be made on partial deliveries accepted by 
the Government if--
    (a) The amount due on the deliveries warrants it; or
    (b) The Contractor requests it and the amount due on the deliveries 
is at least $1,000 or 50 percent of the total contract price.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 56 FR 41744, Aug. 22, 1991]



Sec.  52.232-2  Payments Under Fixed-Price Research and Development Contracts.

    As prescribed in 32.111(a)(2), insert the following clause, as 
appropriately modified with respect to payment due dates in accordance 
with agency regulations, in solicitations and contracts when a fixed-
price research and development contract is contemplated:

Payments Under Fixed-Price Research and Development Contracts (APR 1984)

    The Government shall pay the Contractor, upon submission of proper 
invoices or vouchers, the prices stipulated in this contract for work 
delivered or rendered and accepted, less any deductions provided in this 
contract. Unless otherwise specified, payment shall be made upon 
acceptance of any portion of the work delivered or rendered for which a 
price is separately stated in the contract.

                             (End of clause)



Sec.  52.232-3  Payments Under Personal Services Contracts.

    As prescribed in 32.111(a)(3), insert the following clause, 
appropriately modified with respect to payment due dates in accordance 
with agency regulations, in solicitations and contracts for personal 
services:

          Payments Under Personal Services Contracts (APR 1984)

    The Government shall pay the Contractor for the services performed 
by the Contractor, as set forth in the Schedule of this contract, at the 
rates prescribed, upon the submission by the Contractor of proper 
invoices or time

[[Page 221]]

statements to the office or officer designated and at the time provided 
for in this contract. The Government shall also pay the Contractor (a) a 
per diem rate in lieu of subsistence for each day the Contractor is in a 
travel status away from home or regular place of employment in 
accordance with Federal Travel Regulations (41 CFR 101-7) as authorized 
in appropriate Travel Orders; and (b) any other transportation expenses 
if provided for in the Schedule.

                             (End of clause)



Sec.  52.232-4  Payments Under Transportation Contracts and Transportation-Related 
Services Contracts.

    As prescribed in 32.111(a)(4), insert the following clause, 
appropriately modified with respect to payment due dates in accordance 
with agency regulations, in solicitations and contracts for 
transportation or transportation-related services:

   Payments Under Transportation Contracts and Transportation-Related 
                      Services Contracts (APR 1984)

    The Government shall pay the Contractor upon the submission of 
properly certified invoices or vouchers, the amount due for services 
rendered and accepted, less deductions, if any, as herein provided.

                             (End of clause)



Sec.  52.232-5  Payments Under Fixed-Price Construction Contracts.

    As prescribed in 32.111(a)(5), insert the following clause:

      Payments Under Fixed-Price Construction Contracts (SEP 2002)

    (a) Payment of price. The Government shall pay the Contractor the 
contract price as provided in this contract.
    (b) Progress payments. The Government shall make progress payments 
monthly as the work proceeds, or at more frequent intervals as 
determined by the Contracting Officer, on estimates of work accomplished 
which meets the standards of quality established under the contract, as 
approved by the Contracting Officer.
    (1) The Contractor's request for progress payments shall include the 
following substantiation:
    (i) An itemization of the amounts requested, related to the various 
elements of work required by the contract covered by the payment 
requested.
    (ii) A listing of the amount included for work performed by each 
subcontractor under the contract.
    (iii) A listing of the total amount of each subcontract under the 
contract.
    (iv) A listing of the amounts previously paid to each such 
subcontractor under the contract.
    (v) Additional supporting data in a form and detail required by the 
Contracting Officer.
    (2) In the preparation of estimates, the Contracting Officer may 
authorize material delivered on the site and preparatory work done to be 
taken into consideration. Material delivered to the Contractor at 
locations other than the site also may be taken into consideration if--
    (i) Consideration is specifically authorized by this contract; and
    (ii) The Contractor furnishes satisfactory evidence that it has 
acquired title to such material and that the material will be used to 
perform this contract.
    (c) Contractor certification. Along with each request for progress 
payments, the Contractor shall furnish the following certification, or 
payment shall not be made: (However, if the Contractor elects to delete 
paragraph (c)(4) from the certification, the certification is still 
acceptable.)
    I hereby certify, to the best of my knowledge and belief, that--
    (1) The amounts requested are only for performance in accordance 
with the specifications, terms, and conditions of the contract;
    (2) All payments due to subcontractors and suppliers from previous 
payments received under the contract have been made, and timely payments 
will be made from the proceeds of the payment covered by this 
certification, in accordance with subcontract agreements and the 
requirements of chapter 39 of Title 31, United States Code;
    (3) This request for progress payments does not include any amounts 
which the prime contractor intends to withhold or retain from a 
subcontractor or supplier in accordance with the terms and conditions of 
the subcontract; and
    (4) This certification is not to be construed as final acceptance of 
a subcontractor's performance.

________________________________________________________________________
(Name)
________________________________________________________________________
(Title)
________________________________________________________________________
(Date)

    (d) Refund of unearned amounts. If the Contractor, after making a 
certified request for progress payments, discovers that a portion or all 
of such request constitutes a payment for performance by the Contractor 
that fails to conform to the specifications, terms, and conditions of 
this contract (hereinafter referred to as the unearned amount), the 
Contractor shall--

[[Page 222]]

    (1) Notify the Contracting Officer of such performance deficiency; 
and
    (2) Be obligated to pay the Government an amount (computed by the 
Contracting Officer in the manner provided in paragraph (j) of this 
clause) equal to interest on the unearned amount from the 8th day after 
the date of receipt of the unearned amount until--
    (i) The date the Contractor notifies the Contracting Officer that 
the performance deficiency has been corrected; or
    (ii) The date the Contractor reduces the amount of any subsequent 
certified request for progress payments by an amount equal to the 
unearned amount.
    (e) Retainage. If the Contracting Officer finds that satisfactory 
progress was achieved during any period for which a progress payment is 
to be made, the Contracting Officer shall authorize payment to be made 
in full. However, if satisfactory progress has not been made, the 
Contracting Officer may retain a maximum of 10 percent of the amount of 
the payment until satisfactory progress is achieved. When the work is 
substantially complete, the Contracting Officer may retain from 
previously withheld funds and future progress payments that amount the 
Contracting Officer considers adequate for protection of the Government 
and shall release to the Contractor all the remaining withheld funds. 
Also, on completion and acceptance of each separate building, public 
work, or other division of the contract, for which the price is stated 
separately in the contract, payment shall be made for the completed work 
without retention of a percentage.
    (f) Title, liability, and reservation of rights. All material and 
work covered by progress payments made shall, at the time of payment, 
become the sole property of the Government, but this shall not be 
construed as--
    (1) Relieving the Contractor from the sole responsibility for all 
material and work upon which payments have been made or the restoration 
of any damaged work; or
    (2) Waiving the right of the Government to require the fulfillment 
of all of the terms of the contract.
    (g) Reimbursement for bond premiums. In making these progress 
payments, the Government shall, upon request, reimburse the Contractor 
for the amount of premiums paid for performance and payment bonds 
(including coinsurance and reinsurance agreements, when applicable) 
after the Contractor has furnished evidence of full payment to the 
surety. The retainage provisions in paragraph (e) above shall not apply 
to that portion of progress payments attributable to bond premiums.
    (h) Final payment. The Government shall pay the amount due the 
Contractor under this contract after--
    (1) Completion and acceptance of all work;
    (2) Presentation of a properly executed voucher; and
    (3) Presentation of release of all claims against the Government 
arising by virtue of this contract, other than claims, in stated 
amounts, that the Contractor has specifically excepted from the 
operation of the release. A release may also be required of the assignee 
if the Contractor's claim to amounts payable under this contract has 
been assigned under the Assignment of Claims Act of 1940 (31 U.S.C. 3727 
and 41 U.S.C. 15).
    (i) Limitation because of undefinitized work. Notwithstanding any 
provision of this contract, progress payments shall not exceed 80 
percent on work accomplished on undefinitized contract actions. A 
contract action is any action resulting in a contract, as defined in FAR 
subpart 2.1, including contract modifications for additional supplies or 
services, but not including contract modifications that are within the 
scope and under the terms of the contract, such as contract 
modifications issued pursuant to the Changes clause, or funding and 
other administrative changes.
    (j) Interest computation on unearned amounts. In accordance with 31 
U.S.C. 3903(c)(1), the amount payable under subparagraph (d)(2) of this 
clause shall be--
    (1) Computed at the rate of average bond equivalent rates of 91-day 
Treasury bills auctioned at the most recent auction of such bills prior 
to the date the Contractor receives the unearned amount; and
    (2) Deducted from the next available payment to the Contractor.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 26904, June 28, 1985; 
51 FR 2666, Jan. 17, 1986; 51 FR 19717, May 30, 1986; 52 FR 30078, Aug. 
12, 1987; 54 FR 13337, Mar. 31, 1989; 62 FR 12711, Mar. 17, 1997; 67 FR 
56126, Aug. 30, 2002]



Sec.  52.232-6  Payment Under Communication Service Contracts With Common Carriers.

    As prescribed in 32.111(a)(6), insert the following clause, 
appropriately modified with respect to payment due dates in accordance 
with agency regulations, in solicitations and contracts for regulated 
communication services by common carriers:

Payment Under Communication Service Contracts With Common Carriers (APR 
                                  1984)

    The Government shall pay the Contractor, in arrears, upon submission 
of invoices for services and facilities furnished in accordance with the 
terms of CSAs issued under

[[Page 223]]

this contract, the rates and charges for the services and facilities as 
set forth in the clause entitled Rates, Charges and Services.

                             (End of clause)



Sec.  52.232-7  Payments Under Time-and-Materials and Labor-Hour Contracts.

    As prescribed in 32.111(b), insert the following clause:

  Payments Under Time-and-Materials and Labor-Hour Contracts (DEC 2002)

    The Government will pay the Contractor as follows upon the 
submission of invoices or vouchers approved by the Contracting Officer:
    (a) Hourly rate. (1) The amounts shall be computed by multiplying 
the appropriate hourly rates prescribed in the Schedule by the number of 
direct labor hours performed. The rates shall include wages, indirect 
costs, general and administrative expense, and profit. Fractional parts 
of an hour shall be payable on a prorated basis. Vouchers may be 
submitted once each month (or at more frequent intervals, if approved by 
the Contracting Officer), to the Contracting Officer or designee. The 
Contractor shall substantiate vouchers by evidence of actual payment and 
by individual daily job timecards, or other substantiation approved by 
the Contracting Officer. Promptly after receipt of each substantiated 
voucher, the Government shall, except as otherwise provided in this 
contract, and subject to the terms of (e) below, pay the voucher as 
approved by the Contracting Officer.
    (2) Unless otherwise prescribed in the Schedule, the Contracting 
Officer shall withhold 5 percent of the amounts due under this paragraph 
(a), but the total amount withheld shall not exceed $50,000. The amounts 
withheld shall be retained until the execution and delivery of a release 
by the Contractor as provided in paragraph (f) below.
    (3) Unless the Schedule prescribes otherwise, the hourly rates in 
the Schedule shall not be varied by virtue of the Contractor having 
performed work on an overtime basis. If no overtime rates are provided 
in the Schedule and overtime work is approved in advance by the 
Contracting Officer, overtime rates shall be negotiated. Failure to 
agree upon these overtime rates shall be treated as a dispute under the 
Disputes clause of this contract. If the Schedule provides rates for 
overtime, the premium portion of those rates will be reimbursable only 
to the extent the overtime is approved by the Contracting Officer.
    (b) Materials and subcontracts. (1) The Contracting Officer will 
determine allowable costs of direct materials in accordance with Subpart 
31.2 of the Federal Acquisition Regulation (FAR) in effect on the date 
of this contract. Direct materials, as used in this clause, are those 
materials that enter directly into the end product, or that are used or 
consumed directly in connection with the furnishing of the end product.
    (2) The Contractor may include reasonable and allocable material 
handling costs in the charge for material to the extent they are clearly 
excluded from the hourly rate. Material handling costs are comprised of 
indirect costs, including, when appropriate, general and administrative 
expense allocated to direct materials in accordance with the 
Contractor's usual accounting practices consistent with Subpart 31.2 of 
the FAR.
    (3) The Government will reimburse the Contractor for supplies and 
services purchased directly for the contract when the Contractor--
    (i) Has made payments of cash, checks, or other forms of payment for 
these purchased supplies or services; or
    (ii) Will make these payments determined due--
    (A) In accordance with the terms and conditions of a subcontract or 
invoice; and
    (B) Ordinarily within 30 days of the submission of the Contractor's 
payment request to the Government.
    (4)(i) The Government will reimburse the Contractor for costs of 
subcontracts that are authorized under the subcontracts clause of this 
contract, provided that the costs are consistent with paragraph (b)(5) 
of this clause.
    (ii) The Government will limit reimbursable costs in connection with 
subcontracts to the amounts paid for supplies and services purchased 
directly for the contract when the Contractor has made or will make 
payments determined due of cash, checks, or other forms of payment to 
the subcontractor--
    (A) In accordance with the terms and conditions of a subcontract or 
invoice; and
    (B) Ordinarily within 30 days of the submission of the Contractor's 
payment request to the Government.
    (iii) The Government will not reimburse the Contractor for any costs 
arising from the letting, administration, or supervision of performance 
of the subcontract, if the costs are included in the hourly rates 
payable under paragraph (a)(1) of this clause.
    (5) To the extent able, the Contractor shall--
    (i) Obtain materials at the most advantageous prices available with 
due regard to securing prompt delivery of satisfactory materials; and
    (ii) Take all cash and trade discounts, rebates, allowances, 
credits, salvage, commissions, and other benefits. When unable to take 
advantage of the benefits, the Contractor shall promptly notify the 
Contracting Officer and give the reasons. The

[[Page 224]]

Contractor shall give credit to the Government for cash and trade 
discounts, rebates, scrap, commissions, and other amounts that have 
accrued to the benefit of the Contractor, or would have accrued except 
for the fault or neglect of the Contractor. The Contractor shall not 
deduct from gross costs the benefits lost without fault or neglect on 
the part of the Contractor, or lost through fault of the Government.
    (c) Total cost. It is estimated that the total cost to the 
Government for the performance of this contract shall not exceed the 
ceiling price set forth in the Schedule and the Contractor agrees to use 
its best efforts to perform the work specified in the Schedule and all 
obligations under this contract within such ceiling price. If at any 
time the Contractor has reason to believe that the hourly rate payments 
and material costs that will accrue in performing this contract in the 
next succeeding 30 days, if added to all other payments and costs 
previously accrued, will exceed 85 percent of the ceiling price in the 
Schedule, the Contractor shall notify the Contracting Officer giving a 
revised estimate of the total price to the Government for performing 
this contract with supporting reasons and documentation. If at any time 
during performing this contract, the Contractor has reason to believe 
that the total price to the Government for performing this contract will 
be substantially greater or less than the then stated ceiling price, the 
Contractor shall so notify the Contracting Officer, giving a revised 
estimate of the total price for performing this contract, with 
supporting reasons and documentation. If at any time during performing 
this contract, the Government has reason to believe that the work to be 
required in performing this contract will be substantially greater or 
less than the stated ceiling price, the Contracting Officer will so 
advise the Contractor, giving the then revised estimate of the total 
amount of effort to be required under the contract.
    (d) Ceiling price. The Government shall not be obligated to pay the 
Contractor any amount in excess of the ceiling price in the Schedule, 
and the Contractor shall not be obligated to continue performance if to 
do so would exceed the ceiling price set forth in the Schedule, unless 
and until the Contracting Officer shall have notified the Contractor in 
writing that the ceiling price has been increased and shall have 
specified in the notice a revised ceiling that shall constitute the 
ceiling price for performance under this contract. When and to the 
extent that the ceiling price set forth in the Schedule has been 
increased, any hours expended and material costs incurred by the 
Contractor in excess of the ceiling price before the increase shall be 
allowable to the same extent as if the hours expended and material costs 
had been incurred after the increase in the ceiling price.
    (e) Audit. At any time before final payment under this contract the 
Contracting Officer may request audit of the invoices or vouchers and 
substantiating material. Each payment previously made shall be subject 
to reduction to the extent of amounts, on preceding invoices or 
vouchers, that are found by the Contracting Officer not to have been 
properly payable and shall also be subject to reduction for overpayments 
or to increase for underpayments. Upon receipt and approval of the 
voucher or invoice designated by the Contractor as the completion 
voucher or completion invoice and substantiating material, and upon 
compliance by the Contractor with all terms of this contract (including, 
without limitation, terms relating to patents and the terms of (f) and 
(g) below), the Government shall promptly pay any balance due the 
Contractor. The completion invoice or voucher, and substantiating 
material, shall be submitted by the Contractor as promptly as 
practicable following completion of the work under this contract, but in 
no event later than 1 year (or such longer period as the Contracting 
Officer may approve in writing) from the date of completion.
    (f) Assignment. The Contractor, and each assignee under an 
assignment entered into under this contract and in effect at the time of 
final payment under this contract, shall execute and deliver, at the 
time of and as a condition precedent to final payment under this 
contract, a release discharging the Government, its officers, agents, 
and employees of and from all liabilities, obligations, and claims 
arising out of or under this contract, subject only to the following 
exceptions:
    (1) Specified claims in stated amounts, or in estimated amounts if 
the amounts are not susceptible of exact statement by the Contractor.
    (2) Claims, together with reasonable incidental expenses, based upon 
the liabilities of the Contractor to third parties arising out of 
performing this contract, that are not known to the Contractor on the 
date of the execution of the release, and of which the Contractor gives 
notice in writing to the Contracting Officer not more than 6 years after 
the date of the release or the date of any notice to the Contractor that 
the Government is prepared to make final payment, whichever is earlier.
    (3) Claims for reimbursement of costs (other than expenses of the 
Contractor by reason of its indemnification of the Government against 
patent liability), including reasonable incidental expenses, incurred by 
the Contractor under the terms of this contract relating to patents.
    (g) Refunds. The Contractor agrees that any refunds, rebates, or 
credits (including any related interest) accruing to or received by the 
Contractor or any assignee, that arise under the materials portion of 
this contract

[[Page 225]]

and for which the Contractor has received reimbursement, shall be paid 
by the Contractor to the Government. The Contractor and each assignee, 
under an assignment entered into under this contract and in effect at 
the time of final payment under this contract, shall execute and 
deliver, at the time of and as a condition precedent to final payment 
under this contract, an assignment to the Government of such refunds, 
rebates, or credits (including any interest) in form and substance 
satisfactory to the Contracting Officer.
    (h) Interim payments. (1) Interim payments made prior to the final 
payment under the contract are contract financing payments. Contract 
financing payments are not subject to the interest penalty provisions of 
the Prompt Payment Act.
    (2) The designated payment office will make interim payments for 
contract financing on the --------[Contracting Officer insert day as 
prescribed by agency head; if not prescribed, insert ``30th''] day after 
the designated billing office receives a proper payment request. In the 
event that the Government requires an audit or other review of a 
specific payment request to ensure compliance with the terms and 
conditions of the contract, the designated payment office is not 
compelled to make payment by the specified due date.

                             (End of clause)

    Alternate I (Mar 2000). If the nature of the work to be performed 
requires the Contractor to furnish material that the Contractor 
regularly sells to the general public in the normal course of business, 
and the price is under the limitations prescribed in 16.601(b)(3), add 
the following paragraph (6) to paragraph (b) of the basic clause:

    (b)(6) If the nature of the work to be performed requires the 
Contractor to furnish material that the Contractor regularly sells to 
the general public in the normal course of business, the price to be 
paid for such material, notwithstanding the other requirements of this 
paragraph (b), shall be on the basis of an established catalog or list 
price, in effect when the material is furnished, less all applicable 
discounts to the Government, provided that in no event shall such price 
be in excess of the Contractor's sales price to its most favored 
customer for the same item in like quantity, or the current market 
price, whichever is lower.

    Alternate II (Feb 2002). If a labor-hour contract is contemplated, 
and if no specific reimbursement for materials furnished is intended, 
the Contracting Officer may add the following paragraph (i) to the basic 
clause:

    (i) The terms of this clause that govern reimbursement for materials 
furnished are considered to have been deleted.

[48 FR 42478, Sept. 19, 1983, as amended at 51 FR 2667, Jan. 17, 1986; 
61 FR 67419, Dec. 20, 1996; 65 FR 16283, Mar. 27, 2000; 66 FR 65361, 
Dec. 18, 2001; 67 FR 70521, Nov. 22, 2002]



Sec.  52.232-8  Discounts for Prompt Payment.

    As prescribed in 32.111(c)(1), insert the following clause:

                 Discounts for Prompt Payment (FEB 2002)

    (a) Discounts for prompt payment will not be considered in the 
evaluation of offers. However, any offered discount will form a part of 
the award, and will be taken if payment is made within the discount 
period indicated in the offer by the offeror. As an alternative to 
offering a discount for prompt payment in conjunction with the offer, 
offerors awarded contracts may include discounts for prompt payment on 
individual invoices.
    (b) In connection with any discount offered for prompt payment, time 
shall be computed from the date of the invoice. If the Contractor has 
not placed a date on the invoice, the due date shall be calculated from 
the date the designated billing office receives a proper invoice, 
provided the agency annotates such invoice with the date of receipt at 
the time of receipt. For the purpose of computing the discount earned, 
payment shall be considered to have been made on the date that appears 
on the payment check or, for an electronic funds transfer, the specified 
payment date. When the discount date falls on a Saturday, Sunday, or 
legal holiday when Federal Government offices are closed and Government 
business is not expected to be conducted, payment may be made on the 
following business day.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 26904, June 28, 1985; 
54 FR 13337, Mar. 31, 1989; 62 FR 12712, Mar. 17, 1997; 66 FR 65361, 
Dec. 18, 2001]



Sec.  52.232-9  Limitation on Withholding of Payments.

    As prescribed in 32.111(c)(2), insert a clause substantially as 
follows, appropriately modified with respect to payment due dates in 
accordance with agency regulations, in solicitations and

[[Page 226]]

contracts when a supply contract, service contract, time-and-materials 
contract, labor-hour contract, or research and development contract is 
contemplated that includes two or more terms authorizing the temporary 
withholding of amounts otherwise payable to the contractor for supplies 
delivered or services performed:

            Limitation on Withholding of Payments (APR 1984)

    If more than one clause or Schedule term of this contract authorizes 
the temporary withholding of amounts otherwise payable to the Contractor 
for supplies delivered or services performed, the total of the amounts 
withheld at any one time shall not exceed the greatest amount that may 
be withheld under any one clause or Schedule term at that time; 
provided, that this limitation shall not apply to--
    (a) Withholdings pursuant to any clause relating to wages or hours 
of employees;
    (b) Withholdings not specifically provided for by this contract;
    (c) The recovery of overpayments; and
    (d) Any other withholding for which the Contracting Officer 
determines that this limitation is inappropriate.

                             (End of clause)



Sec.  52.232-10  Payments Under Fixed-Price Architect-Engineer Contracts.

    As prescribed in 32.111(d)(1), insert the following clause:

   Payments Under Fixed-Price Architect-Engineer Contracts (AUG 1987)

    (a) Estimates shall be made monthly of the amount and value of the 
work accomplished and services performed by the Contractor under this 
contract which meet standards of quality established under this 
contract. The estimates shall be prepared by the Contractor and 
accompanied by any supporting data required by the Contracting Officer.
    (b) Upon approval of the estimate by the Contracting Officer, 
payment upon properly executed vouchers shall be made to the Contractor, 
as soon as practicable, of 90 percent of the approved amount, less all 
previous payments; provided, that payment may be made in full during any 
months in which the Contracting Officer determines that performance has 
been satisfactory. Also, whenever the Contracting Officer determines 
that the work is substantially complete and that the amount retained is 
in excess of the amount adequate for the protection of the Government, 
the Contracting Officer may release the excess amount to the Contractor.
    (c) Upon satisfactory completion by the Contractor and acceptance by 
the Contracting Officer of the work done by the Contractor under the 
Statement of Architect-Engineer Services, the Contractor will be paid 
the unpaid balance of any money due for work under the statement, 
including retained percentages relating to this portion of the work. 
Upon satisfactory completion and final acceptance of the construction 
work, the Contractor shall be paid any unpaid balance of money due under 
this contract.
    (d) Before final payment under the contract, or before settlement 
upon termination of the contract, and as a condition precedent thereto, 
the Contractor shall execute and deliver to the Contracting Officer a 
release of all claims against the Government arising under or by virtue 
of this contract, other than any claims that are specifically excepted 
by the Contractor from the operation of the release in amounts stated in 
the release.
    (e) Notwithstanding any other provision in this contract, and 
specifically paragraph (b) of this clause, progress payments shall not 
exceed 80 percent on work accomplished on undefinitized contract 
actions. A contract action is any action resulting in a contract, as 
defined in FAR subpart 2.1, including contract modifications for 
additional supplies or services, but not including contract 
modifications that are within the scope and under the terms of the 
contract, such as contract modifications issued pursuant to the Changes 
clause, or funding and other administrative changes.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 26904, June 28, 1985; 
52 FR 30078, Aug. 12, 1987; 55 FR 38518, Sept. 18, 1990]



Sec.  52.232-11  Extras.

    As prescribed in 32.111(d)(2), insert the following clause, 
appropriately modified with respect to payment due dates in accordance 
with agency regulations, in solicitations and contracts when a fixed-
price supply contract, fixed-price service contract, or transportation 
contract is contemplated:

                            Extras (APR 1984)

    Except as otherwise provided in this contract, no payment for extras 
shall be made unless such extras and the price therefor have been 
authorized in writing by the Contracting Officer.

                             (End of clause)



Sec.  52.232-12  Advance Payments.

    As prescribed in 32.412(a), insert the following clause:

[[Page 227]]

                       Advance Payments (MAY 2001)

    (a) Requirements for payment. Advance payments will be made under 
this contract (1) upon submission of properly certified invoices or 
vouchers by the Contractor, and approval by the administering office, --
---- [Insert the name of the office designated under agency procedures], 
or (2) under a letter of credit. The amount of the invoice or voucher 
submitted plus all advance payments previously approved shall not exceed 
$---- If a letter of credit is used, the Contractor shall withdraw cash 
only when needed for disbursements acceptable under this contract and 
report cash disbursements and balances as required by the administering 
office. The Contractor shall apply terms similar to this clause to any 
advance payments to subcontractors.
    (b) Special account. Until (1) the Contractor has liquidated all 
advance payments made under the contract and related interest charges 
and (2) the administering office has approved in writing the release of 
any funds due and payable to the Contractor, all advance payments and 
other payments under this contract shall be made by check payable to the 
Contractor marked for deposit only in the Contractor's special account 
with the -------- [insert the name of the financial institution]. None 
of the funds in the special account shall be mingled with other funds of 
the Contractor. Withdrawals from the special account may be made only by 
check of the Contractor countersigned by the Contracting Officer or a 
Government countersigning agent designated in writing by the Contracting 
Officer.
    (c) Use of funds. The Contractor may withdraw funds from the special 
account only to pay for properly allocable, allowable, and reasonable 
costs for direct materials, direct labor, and indirect costs. Other 
withdrawals require approval in writing by the administering office. 
Determinations of whether costs are properly allocable, allowable, and 
reasonable shall be in accordance with generally accepted accounting 
principles, subject to any applicable subparts of part 31 of the Federal 
Acquisition Regulation.
    (d) Repayment to the Government. At any time, the Contractor may 
repay all or any part of the funds advanced by the Government. Whenever 
requested in writing to do so by the administering office, the 
Contractor shall repay to the Government any part of unliquidated 
advance payments considered by the administering office to exceed the 
Contractor's current requirements or the amount specified in paragraph 
(a) above. If the Contractor fails to repay the amount requested by the 
administering office, all or any part of the unliquidated advance 
payments may be withdrawn from the special account by check signed by 
only the countersigning agent and applied to reduction of the 
unliquidated advance payments under this contract.
    (e) Maximum payment. When the sum of all unliquidated advance 
payments, unpaid interest charges, and other payments exceed -- percent 
of the contract price, the Government shall withhold further payments to 
the Contractor. On completion or termination of the contract, the 
Government shall deduct from the amount due to the Contractor all 
unliquidated advance payments and all interest charges payable. If 
previous payments to the Contractor exceed the amount due, the excess 
amount shall be paid to the Government on demand. For purposes of this 
paragraph, the contract price shall be considered to be the stated 
contract price of $----, less any subsequent price reductions under the 
contract, plus (1) any price increases resulting from any terms of this 
contract for price redetermination or escalation, and (2) any other 
price increases that do not, in the aggregate, exceed $---- [Insert an 
amount not higher than 10 percent of the stated contract amount inserted 
in this paragraph]. Any payments withheld under this paragraph shall be 
applied to reduce the unliquidated advance payments. If full liquidation 
has been made, payments under the contract shall resume.
    (f) Interest. (1) The Contractor shall pay interest to the 
Government on the daily unliquidated advance payments at the daily rate 
specified in subparagraph (f)(3) below. Interest shall be computed at 
the end of each calendar month for the actual number of days involved. 
For the purpose of computing the interest charge--
    (i) Advance payments shall be considered as increasing the 
unliquidated balance as of the date of the advance payment check;
    (ii) Repayments by Contractor check shall be considered as 
decreasing the unliquidated balance as of the date on which the check is 
received by the Government authority designated by the Contracting 
Officer; and
    (iii) Liquidations by deductions from Government payments to the 
Contractor shall be considered as decreasing the unliquidated balance as 
of the date of the check for the reduced payment.
    (2) Interest charges resulting from the monthly computation shall be 
deducted from payments, other than advance payments, due the Contractor. 
If the accrued interest exceeds the payment due, any excess interest 
shall be carried forward and deducted from subsequent payments. Interest 
carried forward shall not be compounded. Interest on advance payments 
shall cease to accrue upon satisfactory completion or termination of the 
contract for the convenience of the Government. The Contractor shall 
charge interest on advance payments to subcontractors in the manner 
described above and credit the interest to the Government. Interest need

[[Page 228]]

not be charged on advance payments to nonprofit educational or research 
subcontractors for experimental, developmental, or research work.
    (3) If interest is required under the contract, the Contracting 
Officer shall determine a daily interest rate based on the higher of (i) 
the published prime rate of the financial institution (depository) in 
which the special account is established or (ii) the rate established by 
the Secretary of the Treasury under Pub. L. 92-41 (50 U.S.C. App. 
1215(b)(2)). The Contracting Officer shall revise the daily interest 
rate during the contract period in keeping with any changes in the cited 
interest rates.
    (4) If the full amount of interest charged under this paragraph has 
not been paid by deduction or otherwise upon completion or termination 
of this contract, the Contractor shall pay the remaining interest to the 
Government on demand.
    (g) Financial institution agreement. Before an advance payment is 
made under this contract, the Contractor shall transmit to the 
administering office, in the form prescribed by the administering 
office, an agreement in triplicate from the financial institution in 
which the special account is established, clearly setting forth the 
special character of the account and the responsibilities of the 
financial institution under the account. The Contractor shall select a 
financial institution that is a member bank of the Federal Reserve 
System, an ``insured'' bank within the meaning of the Federal Deposit 
Insurance Corporation Act (12 U.S.C. 1811), or a credit union insured by 
the National Credit Union Administration.
    (h) Lien on Special Bank Account. The Government shall have a lien 
upon any balance in the special account paramount to all other liens. 
The Government lien shall secure the repayment of any advance payments 
made under this contract and any related interest charges.
    (i) Lien on property under contract. (1) All advance payments under 
this contract, together with interest charges, shall be secured, when 
made, by a lien in favor of the Government, paramount to all other 
liens, on the supplies or other things covered by this contract and on 
all material and other property acquired for or allocated to the 
performance of this contract, except to the extent that the Government 
by virtue of any other terms of this contract, or otherwise, shall have 
valid title to the supplies, materials, or other property as against 
other creditors of the Contractor.
    (2) The Contractor shall identify, by marking or segregation, all 
property that is subject to a lien in favor of the Government by virtue 
of any terms of this contract in such a way as to indicate that it is 
subject to a lien and that it has been acquired for or allocated to 
performing this contract. If, for any reason, the supplies, materials, 
or other property are not identified by marking or segregation, the 
Government shall be considered to have a lien to the extent of the 
Government's interest under this contract on any mass of property with 
which the supplies, materials, or other property are commingled. The 
Contractor shall maintain adequate accounting control over the property 
on its books and records.
    (3) If, at any time during the progress of the work on the contract, 
it becomes necessary to deliver to a third person any items or materials 
on which the Government has a lien, the Contractor shall notify the 
third person of the lien and shall obtain from the third person a 
receipt in duplicate acknowledging the existence of the lien. The 
Contractor shall provide a copy of each receipt to the Contracting 
Officer.
    (4) If, under the termination clause, the Contracting Officer 
authorizes the Contractor to sell or retain termination inventory, the 
approval shall constitute a release of the Government's lien to the 
extent that--
    (i) The termination inventory is sold or retained; and
    (ii) The sale proceeds or retention credits are applied to reduce 
any outstanding advance payments.
    (j) Insurance. (1) The Contractor shall maintain with responsible 
insurance carriers--
    (i) Insurance on plant and equipment against fire and other hazards, 
to the extent that similar properties are usually insured by others 
operating plants and properties of similar character in the same general 
locality;
    (ii) Adequate insurance against liability on account of damage to 
persons or property; and
    (iii) Adequate insurance under all applicable workers' compensation 
laws.
    (2) Until work under this contract has been completed and all 
advance payments made under the contract have been liquidated, the 
Contractor shall--
    (i) Maintain this insurance;
    (ii) Maintain adequate insurance on any materials, parts, 
assemblies, subassemblies, supplies, equipment, and other property 
acquired for or allocable to this contract and subject to the Government 
lien under paragraph (i) of this clause; and
    (iii) Furnish any evidence with respect to its insurance that the 
administering office may require.
    (k) Default. (1) If any of the following events occurs, the 
Government may, by written notice to the Contractor, withhold further 
withdrawals from the special account and further payments on this 
contract:
    (i) Termination of this contract for a fault of the Contractor.
    (ii) A finding by the administering office that the Contractor has 
failed to--

[[Page 229]]

    (A) Observe any of the conditions of the advance payment terms;
    (B) Comply with any material term of this contract;
    (C) Make progress or maintain a financial condition adequate for 
performance of this contract;
    (D) Limit inventory allocated to this contract to reasonable 
requirements; or
    (E) Avoid delinquency in payment of taxes or of the costs of 
performing this contract in the ordinary course of business.
    (iii) The appointment of a trustee, receiver, or liquidator for all 
or a substantial part of the Contractor's property, or the institution 
of proceedings by or against the Contractor for bankruptcy, 
reorganization, arrangement, or liquidation.
    (iv) The service of any writ of attachment, levy of execution, or 
commencement of garnishment proceedings concerning the special account.
    (v) The commission of an act of bankruptcy.
    (2) If any of the events described in subparagraph (1) above 
continue for 30 days after the written notice to the Contractor, the 
Government may take any of the following additional actions:
    (i) Withdraw by checks payable to the Treasurer of the United 
States, signed only by the countersigning agency, all or any part of the 
balance in the special account and apply the amounts to reduce 
outstanding advance payments and any other claims of the Government 
against the Contractor.
    (ii) Charge interest, in the manner prescribed in paragraph (f) 
above, on outstanding advance payments during the period of any event 
described in subparagraph (1) above.
    (iii) Demand immediate repayment by the Contractor of the 
unliquidated balance of advance payments.
    (iv) Take possession of and, with or without advertisement, sell at 
public or private sale all or any part of the property on which the 
Government has a lien under this contract and, after deducting any 
expenses incident to the sale, apply the net proceeds of the sale to 
reduce the unliquidated balance of advance payments or other Government 
claims against the Contractor.
    (3) The Government may take any of the actions described in 
subparagraphs (k) (1) and (2) of this clause it considers appropriate at 
its discretion and without limiting any other rights of the Government.
    (l) Prohibition against assignment. Notwithstanding any other terms 
of this contract, the Contractor shall not assign this contract, any 
interest therein, or any claim under the contract to any party.
    (m) Information and access to records. The Contractor shall furnish 
to the administering office (1) monthly or at other intervals as 
required, signed or certified balance sheets and profit and loss 
statements together with a report on the operation of the special 
account in the form prescribed by the administering office; and (2) if 
requested, other information concerning the operation of the 
Contractor's business. The Contractor shall provide the authorized 
Government representatives proper facilities for inspection of the 
Contractor's books, records, and accounts.
    (n) Other security. The terms of this contract are considered to 
provide adequate security to the Government for advance payments; 
however, if the administering office considers the security inadequate, 
the Contractor shall furnish additional security satisfactory to the 
administering office, to the extent that the security is available.
    (o) Representations. The Contractor represents the following:
    (1) The balance sheet, the profit and loss statement, and any other 
supporting financial statements furnished to the administering office 
fairly reflect the financial condition of the Contractor at the date 
shown or the period covered, and there has been no subsequent materially 
adverse change in the financial condition of the Contractor.
    (2) No litigation or proceedings are presently pending or threatened 
against the Contractor, except as shown in the financial statements.
    (3) The Contractor has disclosed all contingent liabilities, except 
for liability resulting from the renegotiation of defense production 
contracts, in the financial statements furnished to the administering 
office.
    (4) None of the terms in this clause conflict with the authority 
under which the Contractor is doing business or with the provision of 
any existing indenture or agreement of the Contractor.
    (5) The Contractor has the power to enter into this contract and 
accept advance payments, and has taken all necessary action to authorize 
the acceptance under the terms of this contract.
    (6) The assets of the Contractor are not subject to any lien or 
encumbrance of any character except for current taxes not delinquent, 
and except as shown in the financial statements furnished by the 
Contractor. There is no current assignment of claims under any contract 
affected by these advance payment provisions.
    (7) All information furnished by the Contractor to the administering 
office in connection with each request for advance payments is true and 
correct.
    (8) These representations shall be continuing and shall be 
considered to have been repeated by the submission of each invoice for 
advance payments.

[[Page 230]]

    (p) Covenants. To the extent the Government considers it necessary 
while any advance payments made under this contract remain outstanding, 
the Contractor, without the prior written consent of the administering 
office, shall not--
    (1) Mortgage, pledge, or otherwise encumber or allow to be 
encumbered, any of the assets of the Contractor now owned or 
subsequently acquired, or permit any preexisting mortgages, liens, or 
other encumbrances to remain on or attach to any assets of the 
Contractor which are allocated to performing this contract and with 
respect to which the Government has a lien under this contract;
    (2) Sell, assign, transfer, or otherwise dispose of accounts 
receivable, notes, or claims for money due or to become due;
    (3) Declare or pay any dividends, except dividends payable in stock 
of the corporation, or make any other distribution on account of any 
shares of its capital stock, or purchase, redeem, or otherwise acquire 
for value any of its stock, except as required by sinking fund or 
redemption arrangements reported to the administering office incident to 
the establishment of these advance payment provisions;
    (4) Sell, convey, or lease all or a substantial part of its assets;
    (5) Acquire for value the stock or other securities of any 
corporation, municipality, or governmental authority, except direct 
obligations of the United States;
    (6) Make any advance or loan or incur any liability as guarantor, 
surety, or accommodation endorser for any party;
    (7) Permit a writ of attachment or any similar process to be issued 
against its property without getting a release or bonding the property 
within 30 days after the entry of the writ of attachment or other 
process;
    (8) Pay any remuneration in any form to its directors, officers, or 
key employees higher than rates provided in existing agreements of which 
notice has been given to the administering office; accrue excess 
remuneration without first obtaining an agreement subordinating it to 
all claims of the Government; or employ any person at a rate of 
compensation over $-- a year;
    (9) Change substantially the management, ownership, or control of 
the corporation;
    (10) Merge or consolidate with any other firm or corporation, change 
the type of business, or engage in any transaction outside the ordinary 
course of the Contractor's business as presently conducted;
    (12) Create or incur indebtedness for advances, other than advances 
to be made under the terms of this contract, or for borrowings;
    (13) Make or covenant for capital expenditures exceeding $---- in 
total;
    (14) Permit its net current assets, computed in accordance with 
generally accepted accounting principles, to become less than $----; or
    (15) Make any payments on account of the obligations listed below, 
except in the manner and to the extent provided in this contract:

                     List the pertinent obligations

                             (End of clause)

    Alternate I (APR 1984). If the agency desires to waive the 
countersignature requirement because of the Contractor's financial 
strength, good performance record, and favorable experience concerning 
cost disallowances, add the following sentence, if appropriate, to 
paragraph (b) of the basic clause:

    However, for this contract, countersignature on behalf of the 
Government will not be required unless it is determined necessary by the 
administering office.

    Alternate II (MAY 2001). If used in a cost-reimbursement contract, 
substitute the following paragraphs (c) and (e), and subparagraphs 
(f)(1) and (f)(2) for paragraphs (c) and (e) and subparagraphs (f) (1) 
and (2) of the basic clause:

    (c) Use of funds. The Contractor shall withdraw funds from the 
special account only to pay for allowable costs as prescribed by the --
-- clause of this contract. Payment for any other types of expenses 
shall be approved in writing by the administering office.
    (e) Maximum payment. When the sum of all unliquidated advance 
payments, unpaid interest charges, and other payments equal the total 
estimated cost of $---- (not including fixed-fee, if any) for the work 
under this contract, the Government shall withhold further payments to 
the Contractor. Upon completion or termination of the contract, the 
Government shall deduct from the amount due to the Contractor all 
unliquidated advance payments and interest charges payable. The 
Contractor shall pay any deficiency to the Government upon demand. For 
purposes of this paragraph, the estimated cost shall be considered to be 
the stated estimated cost, less any subsequent reductions of the 
estimated cost, plus any increases in the estimated costs that do not, 
in the aggregate, exceed $---- [Insert an amount not higher than 10 
percent of the stated estimated cost inserted in this paragraph.] The 
estimated cost shall include, without limitation, any reimbursable cost 
(as estimated by the Contracting Officer) incident to a termination for 
the convenience of the Government. Any payments withheld under this 
paragraph shall be applied to reduce the unliquidated advance payments. 
If full liquidation has been

[[Page 231]]

made, payments under the contract shall resume.
    (f) Interest. (1) The Contractor shall pay interest to the 
Government on the daily unliquidated advance payments at the daily rate 
specified in subparagraph (f)(3) below. Interest shall be computed at 
the end of each calendar month for the actual number of days involved. 
For the purpose of computing the interest charge, the following shall be 
observed:
    (i) Advance payments shall be considered as increasing the 
unliquidated balance as of the date of the advance payment check.
    (ii) Repayments by Contractor check shall be considered as 
decreasing the unliquidated balance as of the date on which the check is 
received by the Government authority designated by the Contracting 
Officer.
    (iii) Liquidations by deductions from payments to the Contractor 
shall be considered as decreasing the unliquidated balance as of the 
dates on which the Contractor presents to the Contracting Officer full 
and accurate data for the preparation of each voucher. Credits resulting 
from these deductions shall be made upon the approval of the 
reimbursement vouchers by the Disbursing Officer, based upon the 
Contracting Officer's certification of the applicable dates.
    (2) Interest charges resulting from the monthly computation shall be 
deducted from any payments on account of the fixed-fee due to the 
Contractor. If the accrued interest exceeds the payment due, any excess 
interest shall be carried forward and deducted from subsequent payments 
of the contract price or fixed-fee. Interest carried forward shall not 
be compounded. Interest on advance payments shall cease to accrue upon 
(i) satisfactory completion or (ii) termination of the contract for the 
convenience of the Government. The Contractor shall charge interest on 
advance payments to subcontractors in the manner described above and 
credit the interest to the Government. Interest need not be charged on 
advance payments to nonprofit educational or research subcontractors for 
experimental, developmental, or research work.

    Alternate III (APR 1984). If the agency considers a more rapid 
liquidation appropriate, add the following sentence as the first 
sentence of paragraph (e) of the basic clause with the appropriate 
percentage specified:

    To liquidate the principal amount of any advance payment made to the 
Contractor, there shall be deductions of -- percent from all payments 
made by the Government under the contracts involved.

    Alternate IV (APR 1984). If the agency provides advance payments 
under the contract at no interest to the prime contractor, add the 
following sentences as the beginning sentences of paragraph (f) of the 
clause:

    No interest shall be charged to the prime Contractor for advance 
payments except for interest charged during a period of default. The 
terms of this paragraph concerning interest charges for advance payments 
shall not apply to the prime Contractor.

    Alternate V (MAY 2001). If the requirement for a special account is 
eliminated in accordance with 32.409-3 (e) or (g), insert the clause set 
forth below instead of the basic clause.
    If this Alternate is used in combination with Alternate II, 
disregard the instructions concerning paragraph (c), Use of funds, in 
Alternate II; substitute paragraph (e), Maximum payment, in Alternate II 
for paragraph (d) below; and substitute paragraph (f), Interest, in 
Alternate II for paragraph (e) below and change the reference to 
paragraph (f)(3) in the first sentence of paragraph (f) of Alternate II 
to (e)(3).
    If this Alternate is used in combination with Alternate III, insert 
the additional sentence set forth in Alternate III as the first sentence 
of paragraph (d) of this Alternate.
    If this Alternate is used in combination with Alternate IV, insert 
the additional sentences set forth in Alternate IV as the beginning 
sentences of paragraph (e) of this Alternate.

           Advance Payments Without Special Account (MAY 2001)

    (a) Requirements for payment. Advance payments will be made under 
this contract (1) upon submission of properly certified invoices or 
vouchers by the contractor, and approval by the administering office, --
--- [insert the name of the office designated under agency procedures], 
or (2) under a letter of credit. The amount of the invoice or voucher 
submitted plus all advance payments previously approved shall not exceed 
$----. If a letter of credit is used, the Contractor shall withdraw cash 
only when needed for disbursements acceptable under this contract and 
report cash disbursements and balances as required by the administering 
office. The Contractor shall apply terms similar to this clause to any 
advance payments to subcontractors.
    (b) Use of funds. The Contractor may use advance payment funds only 
to pay for properly allocable, allowable, and reasonable costs for 
direct materials, direct labor, and indirect costs. Determinations of 
whether costs are properly allocable, allowable, and

[[Page 232]]

reasonable shall be in accordance with generally accepted accounting 
principles, subject to any applicable subparts of part 31 of the Federal 
Acquisition Regulation.
    (c) Repayment to the Government. At any time, the Contractor may 
repay all or any part of the funds advanced by the Government. Whenever 
requested in writing to do so by the administering office, the 
Contractor shall repay to the Government any part of unliquidated 
advance payments considered by the administering office to exceed the 
Contractor's current requirements or the amount specified in paragraph 
(a) of this clause.
    (d) Maximum payment. When the sum of all unliquidated advance 
payments, unpaid interest charges, and other payments exceed ----- 
percent of the contract price, the Government shall withhold further 
payments to the Contractor. On completion or termination of the 
contract, the Government shall deduct from the amount due to the 
Contractor all unliquidated advance payments and all interest charges 
payable. If previous payments to the Contractor exceed the amount due, 
the excess amount shall be paid to the Government on demand. For 
purposes of this paragraph, the contract price shall be considered to be 
the stated contract price of $----, less any subsequent price reductions 
under the contract, plus (1) any price increases resulting from any 
terms of this contract for price redetermination or escalation, and (2) 
any other price increases that do not, in the aggregate, exceed $---- 
[insert an amount not higher than 10 percent of the stated contract 
amount inserted in this paragraph]. Any payments withheld under this 
paragraph shall be applied to reduce the unliquidated advance payments. 
If full liquidation has been made, payments under the contract shall 
resume.
    (e) Interest. (1) The Contractor shall pay interest to the 
Government on the daily unliquidated advance payments at the daily rate 
in subparagraph (e)(3) of this clause. Interest shall be computed at the 
end of each calendar month for the actual number of days involved. For 
the purpose of computing the interest charge--
    (i) Advance payments shall be considered as increasing the 
unliquidated balance as of the date of the advance payment check;
    (ii) Repayments by Contractor check shall be considered as 
decreasing the unliquidated balance as of the date on which the check is 
received by the Government authority designated by the Contracting 
Officer; and
    (iii) Liquidations by deductions from Government payments to the 
Contractor shall be considered as decreasing the unliquidated balance as 
of the date of the check for the reduced payment.
    (2) Interest charges resulting from the monthly computation shall be 
deducted from payments, other than advance payments, due the Contractor. 
If the accrued interest exceeds the payment due, any excess interest 
shall be carried forward and deducted from subsequent payments. Interest 
carried forward shall not be compounded. Interest on advance payments 
shall cease to accrue upon satisfactory completion or termination of the 
contract for the convenience of the Government. The Contractor shall 
charge interest on advance payments to subcontractors in the manner 
described above and credit the interest to the Government. Interest need 
not be charged on advance payments to nonprofit educational or research 
subcontractors, for experimental, developmental, or research work.
    (3) If interest is required under the contract, the Contracting 
Officer shall determine a daily interest rate based on the rate 
established by the Secretary of the Treasury under Pub. L. 92-41 (50 
U.S.C. App., 1215(b)(2)). The Contracting Officer shall revise the daily 
interest rate during the contract period in keeping with any changes in 
the cited interest rate.
    (4) If the full amount of interest charged under this paragraph has 
not been paid by deduction or otherwise upon completion or termination 
of this contract, the Contractor shall pay the remaining interest to the 
Government on demand.
    (f) Lien on property under contract. (1) All advance payments under 
this contract, together with interest charges, shall be secured, when 
made, by a lien in favor of the Government, paramount to all other 
liens, on the supplies or other things covered by this contract and on 
all material and other property acquired for or allocated to the 
performance of this contract, except to the extent that the Government 
by virtue of any other terms of this contract, or otherwise, shall have 
valid title to the supplies, materials, or other property as against 
other creditors of the Contractor.
    (2) The Contractor shall identify, by marking or segregation, all 
property that is subject to a lien in favor of the Government by virtue 
of any terms of this contract in such a way as to indicate that it is 
subject to a lien and that it has been acquired for or allocated to 
performing this contract. If, for any reason, the supplies, materials, 
or other property are not identified by marking or segregation, the 
Government shall be considered to have a lien to the extent of the 
Government's interest under this contract on any mass of property with 
which the supplies, materials, or other property are commingled. The 
Contractor shall maintain adequate accounting control over the property 
on its books and records.
    (3) If, at any time during the progress of the work on the contract, 
it becomes necessary to deliver to a third person any items or materials 
on which the Government has a lien, the Contractor shall notify the 
third

[[Page 233]]

person of the lien and shall obtain from the third person a receipt in 
duplicate acknowledging the existence of the lien. The Contractor shall 
provide a copy of each receipt to the Contracting Officer.
    (4) If, under the termination clause, the Contracting Officer 
authorizes the contractor to sell or retain termination inventory, the 
approval shall constitute a release of the Government's lien to the 
extent that--
    (i) The termination inventory is sold or retained; and
    (ii) The sale proceeds or retention credits are applied to reduce 
any outstanding advance payments.
    (g) Insurance. (1) The Contractor shall maintain with responsible 
insurance carriers--
    (i) Insurance on plant and equipment against fire and other hazards, 
to the extent that similar properties are usually insured by others 
operating plants and properties of similar character in the same general 
locality;
    (ii) Adequate insurance against liability on account of damage to 
persons or property; and
    (iii) Adequate insurance under all applicable workers' compensation 
laws.
    (2) Until work under this contract has been completed and all 
advance payments made under the contract have been liquidated, the 
Contractor shall--
    (i) Maintain this insurance;
    (ii) Maintain adequate insurance on any materials, parts, 
assemblies, subassemblies, supplies, equipment, and other property 
acquired for or allocable to this contract and subject to the Government 
lien under paragraph (f) of this clause; and
    (iii) Furnish any evidence with respect to its insurance that the 
administering office may require.
    (h) Default. (1) If any of the following events occur, the 
Government may, by written notice to the Contractor, withhold further 
payments on this contract:
    (i) Termination of this contract for a fault of the Contractor.
    (ii) A finding by the administering office that the Contractor has 
failed to--
    (A) Observe any of the conditions of the advance payment terms;
    (B) Comply with any material term of this contract;
    (C) Make progress or maintain a financial condition adequate for 
performance of this contract;
    (D) Limit inventory allocated to this contract to reasonable 
requirements; or
    (E) Avoid delinquency in payment of taxes or of the costs of 
performing this contract in the ordinary course of business.
    (iii) The appointment of a trustee, receiver, or liquidator for all 
or a substantial part of the Contractor's property, or the institution 
of proceedings by or against the Contractor for bankruptcy, 
reorganization, arrangement, or liquidation.
    (iv) The commission of an act of bankruptcy.
    (2) If any of the events described in subparagraph (h)(1) of this 
clause continue for 30 days after the written notice to the Contractor, 
the Government may take any of the following additional actions:
    (i) Charge interest, in the manner prescribed in paragraph (e) of 
this clause, on outstanding advance payments during the period of any 
event described in subparagraph (h)(1) of this clause.
    (ii) Demand immediate repayment by the Contractor of the 
unliquidated balance of advance payments.
    (iii) Take possession of and, with or without advertisement, sell at 
public or private sale all or any part of the property on which the 
Government has a lien under this contract and, after deducting any 
expenses incident to the sale, apply the net proceeds of the sale to 
reduce the unliquidated balance of advance payments or other Government 
claims against the Contractor.
    (3) The Government may take any of the actions described in 
subparagraphs (h)(1) and (h)(2) of this clause it considers appropriate 
at its discretion and without limiting any other rights of the 
Government.
    (i) Prohibition against assignment. Notwithstanding any other terms 
of this contract, the Contractor shall not assign this contract, any 
interest therein, or any claim under the contract to any party.
    (j) Information and access to records. The Contractor shall furnish 
to the administering office (1) monthly or at other intervals as 
required, signed or certified balance sheets and profit and loss 
statements, and, (2) if requested, other information concerning the 
operation of the contractor's business. The Contractor shall provide the 
authorized Government representatives proper facilities for inspection 
of the Contractor's books, records, and accounts.
    (k) Other security. The terms of this contract are considered to 
provide adequate security to the Government for advance payments; 
however, if the administering office considers the security inadequate, 
the Contractor shall furnish additional security satisfactory to the 
administering office, to the extent that the security is available.
    (l) Representations. The Contractor represents the following:
    (1) The balance sheet, the profit and loss statement, and any other 
supporting financial statements furnished to the administering office 
fairly reflect the financial condition of the Contractor at the date 
shown or the period covered, and there has been no subsequent materially 
adverse change in the financial condition of the Contractor.

[[Page 234]]

    (2) No litigation or proceedings are presently pending or threatened 
against the Contractor, except as shown in the financial statements.
    (3) The Contractor has disclosed all contingent liabilities, except 
for liability resulting from the renegotiation of defense production 
contracts, in the financial statements furnished to the administering 
office.
    (4) None of the terms in this clause conflict with the authority 
under which the Contractor is doing business or with the provision of 
any existing indenture or agreement of the Contractor.
    (5) The Contractor has the power to enter into this contract and 
accept advance payments, and has takken all necessary action to 
authorize the acceptance under the terms of this contract.
    (6) The assets of the Contractor are not subject to any lien or 
encumbrance of any character except for current taxes not delinquent, 
and except as shown in the financial statements furnished by the 
Contractor. There is no current assignment of claims under any contract 
affected by these advance payment provisions.
    (7) All information furnished by the Contractor to the administering 
office in connection with each request for advance payments is true and 
correct.
    (8) These representations shall be continuing and shall be 
considered to have been repeated by the submission of each invoice for 
advance payments.
    (m) Covenants. To the extent the Government considers it necessary 
while any advance payments made under this contract remain outstanding, 
the Contractor, without the prior written consent of the administering 
office, shall not--
    (1) Mortgage, pledge, or otherwise encumber or allow to be 
encumbered, any of the assets of the Contractor now owned or 
subsequently acquired, or permit any preexisting mortgages, liens, or 
other encumbrances to remain on or attach to any assets of the 
Contractor which are allocated to performing this contract and with 
respect to which the Government has a lien under this contract;
    (2) Sell, assign, transfer, or otherwise dispose of accounts 
receivable, notes, or claims for money due or to become due;
    (3) Declare or pay any dividends, except dividends payable in stock 
of the corporation, or make any other distribution on account of any 
shares of its capital stock, or purchase, redeem, or otherwise acquire 
for value any of its stock, except as required by sinking fund or 
redemption arrangements reported to the administering office incident to 
the establishment of these advance payment provisions;
    (4) Sell, convey, or lease all or a substantial part of its assets;
    (5) Acquire for value the stock or other securities of any 
corporation, municipality, or Governmental authority, except direct 
obligations of the United States;
    (6) Make any advance or loan or incur any liability as guarantor, 
surety, or accommodation endorser for any party;
    (7) Permit a writ of attachment or any similar process to be issued 
against its property without getting a release or bonding the property 
within 30 days after the entry of the writ of attachment or other 
process;
    (8) Pay any remuneration in any form to its directors, officers, or 
key employees higher than rates provided in existing agreements of which 
notice has been given to the administering office; accure excess 
remuneration without first obtaining an agreement subordinating it to 
all claims of the Government; or employ any person at a rate of 
compensation over ----- a year.
    (9) Change substantially the management, ownership, or control of 
the corporation;
    (10) Merge or consolidate with any other firm or corporation, change 
the type of business, or engage in any transaction outside the ordinary 
course of the Contractor's business as presently conducted;
    (11) Deposit any of its funds except in a bank or trust company 
insured by the Federal Deposit Insurance Corporation or a credit union 
insured by the National Credit Union Administration;
    (12) Create or incur indebtedness for advances, other than advances 
to be made under the terms of this contract, or for borrowings;
    (13) Make or covenant for capital expenditures exceeding $---- in 
total;
    (14) Permit its net current assets, computed in accordance with 
generally accepted accounting principles, to become less than -----; or
    (15) Make any payments on account of the obligations listed below, 
except in the manner and to the extent provided in this contract:

                    [List the pertinent obligations]

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 25532, June 21, 1990; 
64 FR 10534, Mar. 4, 1999; 66 FR 2138, Jan. 10, 2001]



Sec.  52.232-13  Notice of Progress Payments.

    As prescribed in 32.502-3(a), insert the following provision in 
invitations for bids and requests for proposals that include a Progress 
Payments clause:

                 Notice of Progress Payments (APR 1984)

    The need for customary progress payments conforming to the 
regulations in subpart 32.5 of the Federal Acquisition Regulation (FAR) 
will not be considered as a handicap or adverse factor in the award of 
the contract. The Progress Payments clause included in

[[Page 235]]

this solicitation will be included in any resulting contract, modified 
or altered if necessary in accordance with subsection 52.232-16 and its 
Alternate I of the FAR. Even though the clause is included in the 
contract, the clause shall be inoperative during any time the 
contractor's accounting system and controls are determined by the 
Government to be inadequate for segregation and accumulation of contract 
costs.

                           (End of provision)



Sec.  52.232-14  Notice of Availability of Progress Payments Exclusively for 
Small Business Concerns.

    As prescribed in 32.502-3(b)(2), insert the following provision in 
invitations for bids if it is anticipated that (a) both small business 
concerns and others may submit bids in response to the same invitation 
and (b) only the small business bidders would need progress payments:

   Notice of Availability of Progress Payments Exclusively for Small 
                      Business Concerns (APR 1984)

    The Progress Payments clause will be available only to small 
business concerns. Any bid conditioned upon inclusion of a progress 
payment clause in the resulting contract will be rejected as 
nonresponsive if the bidder is not a small business concern.

                           (End of provision)



Sec.  52.232-15  Progress Payments Not Included.

    As prescribed in 32.502-3(c), insert the following provision in 
invitations for bids if the solicitation will not contain one of the 
provisions prescribed in 32.502-3 (a) and (b):

                Progress Payments Not Included (APR 1984)

    A progress payments clause is not included in this solicitation, and 
will not be added to the resulting contract at the time of award. Bids 
conditioned upon inclusion of a progress payment clause in the resulting 
contract will be rejected as nonresponsive.

                           (End of provision)



Sec.  52.232-16  Progress Payments.

    As prescribed in 32.502-4(a), insert the following clause:

                     Progress Payments (April 2003)

    The Government will make progress payments to the Contractor when 
requested as work progresses, but not more frequently than monthly, in 
amounts of $2,500 or more approved by the Contracting Officer, under the 
following conditions:
    (a) Computation of amounts. (1) Unless the Contractor requests a 
smaller amount, the Government will compute each progress payment as 80 
percent of the Contractor's total costs incurred under this contract 
whether or not actually paid, plus financing payments to subcontractors 
(see paragraph (j) of this clause), less the sum of all previous 
progress payments made by the Government under this contract. The 
Contracting Officer will consider cost of money that would be allowable 
under FAR 31.205-10 as an incurred cost for progress payment purposes.
    (2) The amount of financing and other payments for supplies and 
services purchased directly for the contract are limited to the amounts 
that have been paid by cash, check, or other forms of payment, or that 
are determined due and will be paid to subcontractors--
    (i) In accordance with the terms and conditions of a subcontract or 
invoice; and
    (ii) Ordinarily within 30 days of the submission of the Contractor's 
payment request to the Government.
    (3) The Government will exclude accrued costs of Contractor 
contributions under employee pension plans until actually paid unless--
    (i) The Contractor's practice is to make contributions to the 
retirement fund quarterly or more frequently; and
    (ii) The contribution does not remain unpaid 30 days after the end 
of the applicable quarter or shorter payment period (any contribution 
remaining unpaid shall be excluded from the Contractor's total costs for 
progress payments until paid).
    (4) The Contractor shall not include the following in total costs 
for progress payment purposes in paragraph (a)(1) of this clause:
    (i) Costs that are not reasonable, allocable to this contract, and 
consistent with sound and generally accepted accounting principles and 
practices.
    (ii) Costs incurred by subcontractors or suppliers.
    (iii) Costs ordinarily capitalized and subject to depreciation or 
amortization except for the properly depreciated or amortized portion of 
such costs.
    (iv) Payments made or amounts payable to subcontractors or 
suppliers, except for--
    (A) Completed work, including partial deliveries, to which the 
Contractor has acquired title; and
    (B) Work under cost-reimbursement or time-and-material subcontracts 
to which the Contractor has acquired title.
    (5) The amount of unliquidated progress payments may exceed neither 
(i) the progress payments made against incomplete work (including 
allowable unliquidated

[[Page 236]]

progress payments to subcontractors) nor (ii) the value, for progress 
payment purposes, of the incomplete work. Incomplete work shall be 
considered to be the supplies and services required by this contract, 
for which delivery and invoicing by the Contractor and acceptance by the 
Government are incomplete.
    (6) The total amount of progress payments shall not exceed 80 
percent of the total contract price.
    (7) If a progress payment or the unliquidated progress payments 
exceed the amounts permitted by subparagraphs (a)(4) or (a)(5) above, 
the Contractor shall repay the amount of such excess to the Government 
on demand.
    (8) Notwithstanding any other terms of the contract, the Contractor 
agrees not to request progress payments in dollar amounts of less than 
$2,500. The Contracting Officer may make exceptions.
    (b) Liquidation. Except as provided in the Termination for 
Convenience of the Government clause, all progress payments shall be 
liquidated by deducting from any payment under this contract, other than 
advance or progress payments, the unliquidated progress payments, or 80 
percent of the amount invoiced, whichever is less. The Contractor shall 
repay to the Government any amounts required by a retroactive price 
reduction, after computing liquidations and payments on past invoices at 
the reduced prices and adjusting the unliquidated progress payments 
accordingly. The Government reserves the right to unilaterally change 
from the ordinary liquidation rate to an alternate rate when deemed 
appropriate for proper contract financing.
    (c) Reduction or suspension. The Contracting Officer may reduce or 
suspend progress payments, increase the rate of liquidation, or take a 
combination of these acquisitions, after finding on substantial evidence 
any of the following conditions:
    (1) The Contractor failed to comply with any material requirement of 
this contract (which includes paragraphs (f) and (g) below).
    (2) Performance of this contract is endangered by the Contractor's 
(i) failure to make progress or (ii) unsatisfactory financial condition.
    (3) Inventory allocated to this contract substantially exceeds 
reasonable requirements.
    (4) The Contractor is delinquent in payment of the costs of 
performing this contract in the ordinary course of business.
    (5) The unliquidated progress payments exceed the fair value of the 
work accomplished on the undelivered portion of this contract.
    (6) The Contractor is realizing less profit than that reflected in 
the establishment of any alternate liquidation rate in paragraph (b) 
above, and that rate is less than the progress payment rate stated in 
subparagraph (a)(1) above.
    (d) Title. (1) Title to the property described in this paragraph (d) 
shall vest in the Government. Vestiture shall be immediately upon the 
date of this contract, for property acquired or produced before that 
date. Otherwise, vestiture shall occur when the property is or should 
have been allocable or properly chargeable to this contract.
    (2) Property, as used in this clause, includes all of the below-
described items acquired or produced by the Contractor that are or 
should be allocable or properly chargeable to this contract under sound 
and generally accepted accounting principles and practices.
    (i) Parts, materials, inventories, and work in process;
    (ii) Special tooling and special test equipment to which the 
Government is to acquire title under any other clause of this contract;
    (iii) Nondurable (i.e., noncapital) tools, jigs, dies, fixtures, 
molds, patterns, taps, gauges, test equipment, and other similar 
manufacturing aids, title to which would not be obtained as special 
tooling under subparagraph (ii) above; and
    (iv) Drawings and technical data, to the extent the Contractor or 
subcontractors are required to deliver them to the Government by other 
clauses of this contract.
    (3) Although title to property is in the Government under this 
clause, other applicable clauses of this contract, e.g., the termination 
or special tooling clauses, shall determine the handling and disposition 
of the property.
    (4) The Contractor may sell any scrap resulting from production 
under this contract without requesting the Contracting Officer's 
approval, but the proceeds shall be credited against the costs of 
performance.
    (5) To acquire for its own use or dispose of property to which title 
is vested in the Government under this clause, the Contractor must 
obtain the Contracting Officer's advance approval of the action and the 
terms. The Contractor shall (i) exclude the allocable costs of the 
property from the costs of contract performance, and (ii) repay to the 
Government any amount of unliquidated progress payments allocable to the 
property. Repayment may be by cash or credit memorandum.
    (6) When the Contractor completes all of the obligations under this 
contract, including liquidation of all progress payments, title shall 
vest in the Contractor for all property (or the proceeds thereof) not--
    (i) Delivered to, and accepted by, the Government under this 
contract; or
    (ii) Incorporated in supplies delivered to, and accepted by, the 
Government under this contract and to which title is vested in the 
Government under this clause.
    (7) The terms of this contract concerning liability for Government-
furnished property

[[Page 237]]

shall not apply to property to which the Government acquired title 
solely under this clause.
    (e) Risk of loss. Before delivery to and acceptance by the 
Government, the Contractor shall bear the risk of loss for property, the 
title to which vests in the Government under this clause, except to the 
extent the Government expressly assumes the risk. The Contractor shall 
repay the Government an amount equal to the unliquidated progress 
payments that are based on costs allocable to property that is damaged, 
lost, stolen, or destroyed.
    (f) Control of costs and property. The Contractor shall maintain an 
accounting system and controls adequate for the proper administration of 
this clause.
    (g) Reports and access to records. The Contractor shall promptly 
furnish reports, certificates, financial statements, and other pertinent 
information reasonably requested by the Contracting Officer for the 
administration of this clause. Also, the Contractor shall give the 
Government reasonable opportunity to examine and verify the Contractor's 
books, records, and accounts.
    (h) Special terms regarding default. If this contract is terminated 
under the Default clause, (i) the Contractor shall, on demand, repay to 
the Government the amount of unliquidated progress payments and (ii) 
title shall vest in the Contractor, on full liquidation of progress 
payments, for all property for which the Government elects not to 
require delivery under the Default clause. The Government shall be 
liable for no payment except as provided by the Default clause.
    (i) Reservations of rights. (1) No payment or vesting of title under 
this clause shall (i) excuse the Contractor from performance of 
obligations under this contract or (ii) constitute a waiver of any of 
the rights or remedies of the parties under the contract.
    (2) The Government's rights and remedies under this clause (i) shall 
not be exclusive but rather shall be in addition to any other rights and 
remedies provided by law or this contract and (ii) shall not be affected 
by delayed, partial, or omitted exercise of any right, remedy, power, or 
privilege, nor shall such exercise or any single exercise preclude or 
impair any further exercise under this clause or the exercise of any 
other right, power, or privilege of the Government.
    (j) Financing payments to subcontractors. The financing payments to 
subcontractors mentioned in paragraphs (a)(1) and (a)(2) of this clause 
shall be all financing payments to subcontractors or divisions, if the 
following conditions are met:
    (1) The amounts included are limited to--
    (i) The unliquidated remainder of financing payments made; plus
    (ii) Any unpaid subcontractor requests for financing payments.
    (2) The subcontract or interdivisional order is expected to involve 
a minimum of approximately 6 months between the beginning of work and 
the first delivery; or, if the subcontractor is a small business 
concern, 4 months.
    (3) If the financing payments are in the form of progress payments, 
the terms of the subcontract or interdivisional order concerning 
progress payments--
    (i) Are substantially similar to the terms of this clause for any 
subcontractor that is a large business concern, or this clause with its 
Alternate I for any subcontractor that is a small business concern;
    (ii) Are at least as favorable to the Government as the terms of 
this clause;
    (iii) Are not more favorable to the subcontractor or division than 
the terms of this clause are to the Contractor;
    (iv) Are in conformance with the requirements of FAR 32.504(e); and
    (v) Subordinate all subcontractor rights concerning property to 
which the Government has title under the subcontract to the Government's 
right to require delivery of the property to the Government if--
    (A) The Contractor defaults; or
    (B) The subcontractor becomes bankrupt or insolvent.
    (4) If the financing payments are in the form of performance-based 
payments, the terms of the subcontract or interdivisional order 
concerning payments--
    (i) Are substantially similar to the Performance-Based Payments 
clause at FAR 52.232-32 and meet the criteria for, and definition of, 
performance-based payments in FAR Part 32;
    (ii) Are in conformance with the requirements of FAR 32.504(f); and
    (iii) Subordinate all subcontractor rights concerning property to 
which the Government has title under the subcontract to the Government's 
right to require delivery of the property to the Government if--
    (A) The Contractor defaults; or
    (B) The subcontractor becomes bankrupt or insolvent.
    (5) If the financing payments are in the form of commercial item 
financing payments, the terms of the subcontract or interdivisional 
order concerning payments--
    (i) Are constructed in accordance with FAR 32.206(c) and included in 
a subcontract for a commercial item purchase that meets the definition 
and standards for acquisition of commercial items in FAR Parts 2 and 12;
    (ii) Are in conformance with the requirements of FAR 32.504(g); and
    (iii) Subordinate all subcontractor rights concerning property to 
which the Government has title under the subcontract to the Government's 
right to require delivery of the property to the Government if--
    (A) The Contractor defaults; or

[[Page 238]]

    (B) The subcontractor becomes bankrupt or insolvent.
    (6) If financing is in the form of progress payments, the progress 
payment rate in the subcontract is the customary rate used by the 
contracting agency, depending on whether the subcontractor is or is not 
a small business concern.
    (7) Concerning any proceeds received by the Government for property 
to which title has vested in the Government under the subcontract terms, 
the parties agree that the proceeds shall be applied to reducing any 
unliquidated financing payments by the Government to the Contractor 
under this contract.
    (8) If no unliquidated financing payments to the Contractor remain, 
but there are unliquidated financing payments that the Contractor has 
made to any subcontractor, the Contractor shall be subrogated to all the 
rights the Government obtained through the terms required by this clause 
to be in any subcontract, as if all such rights had been assigned and 
transferred to the Contractor.
    (9) To facilitate small business participation in subcontracting 
under this contract, the Contractor shall provide financing payments to 
small business concerns, in conformity with the standards for customary 
contract financing payments stated in FAR 32.113. The Contractor shall 
not consider the need for such financing payments as a handicap or 
adverse factor in the award of subcontracts.
    (k) Limitations on undefinitized contract actions. Notwithstanding 
any other progress payment provisions in this contract, progress 
payments may not exceed 80 percent of costs incurred on work 
accomplished under undefinitized contract actions. A contract action is 
any action resulting in a contract, as defined in subpart 2.1, including 
contract modifications for additional supplies or services, but not 
including contract modifications that are within the scope and under the 
terms of the contract, such as contract modifications issued pursuant to 
the Changes clause, or funding and other administrative changes. This 
limitation shall apply to the costs incurred, as computed in accordance 
with paragraph (a) of this clause, and shall remain in effect until the 
contract action is definitized. Costs incurred which are subject to this 
limitation shall be segregated on Contractor progress payment requests 
and invoices from those costs eligible for higher progress payment 
rates. For purposes of progress payment liquidation, as described in 
paragraph (b) of this clause, progress payments for undefinitized 
contract actions shall be liquidated at 80 percent of the amount 
invoiced for work performed under the undefinitized contract action as 
long as the contract action remains undefinitized. The amount of 
unliquidated progress payments for undefinitized contract actions shall 
not exceed 80 percent of the maximum liability of the Government under 
the undefinitized contract action or such lower limit specified 
elsewhere in the contract. Separate limits may be specified for separate 
actions.
    (l) Due date. The designated payment office will make progress 
payments on the -------- [Contracting Officer insert date as prescribed 
by agency head; if not prescribed, insert ``30th''] day after the 
designated billing office receives a proper progress payment request. In 
the event that the Government requires an audit or other review of a 
specific progress payment request to ensure compliance with the terms 
and conditions of the contract, the designated payment office is not 
compelled to make payment by the specified due date. Progress payments 
are considered contract financing and are not subject to the interest 
penalty provisions of the Prompt Payment Act.
    (m) Progress payments under indefinite--delivery contracts. The 
Contractor shall account for and submit progress payment requests under 
individual orders as if the order constituted a separate contract, 
unless otherwise specified in this contract.

                             (End of clause)

    Alternate I (Mar 2000). If the contract is with a small business 
concern, change each mention of the progress payment and liquidation 
rates excepting paragraph (k) to the customary rate of 85 percent for 
small business concerns (see FAR 32.501-1).
    Alternate II (Apr 2003). If the contract is a letter contract, add 
paragraphs (n) and (o). The amount specified in paragraph (o) shall not 
exceed 80 percent of the maximum liability of the Government under the 
letter contract. The contracting officer may specify separate limits for 
separate parts of the work.

    (n) The Contracting Officer will liquidate progress payments made 
under this letter contract, unless previously liquidated under paragraph 
(b) of this clause, using the following procedures:
    (1) If this letter contract is superseded by a definitive contract, 
unliquidated progress payments made under this letter contract shall be 
liquidated by deducting the amount from the first progress or other 
payments made under the definitive contract.
    (2) If this letter contract is not superseded by a definitive 
contract calling for the furnishing of all or part of the articles or 
services covered under the letter contract, unliquidated progress 
payments made under the

[[Page 239]]

letter contract shall be liquidated by deduction from the amount payable 
under the Termination clause.
    (3) If this letter contract is partly terminated and partly 
superseded by a contract, the Government will allocate the unliquidated 
progress payments to the terminated and unterminated portions as the 
Government deems equitable, and will liquidate each portion under the 
relevant procedure in paragraphs (n)(1) and (n)(2) of this clause.
    (4) If the method of liquidating progress payments provided in this 
clause does not result in full liquidation, the Contractor shall 
immediately pay the unliquidated balance to the Government on demand.
    (o) The amount of unliquidated progress payments shall not exceed --
------ [Contracting Officer specify dollar amount].

    Alternate III (Apr 2003). As prescribed in 32.502-4(d), add the 
following paragraph (n) to the basic clause. If Alternate II is also 
being used, redesignate the following paragraph as paragraph (p):

    (n) The provisions of this clause will not be applicable to 
individual orders at or below the simplified acquisition threshold.

[48 FR 42478, Sept. 19, 1983, as amended at 52 FR 30078, Aug. 12, 1987; 
55 FR 40392, Oct. 3, 1990; 56 FR 29138, June 25, 1991; 65 FR 16284, Mar. 
27, 2000; 66 FR 65361, Dec. 18, 2001; 67 FR 56126, Aug. 30, 2002; 67 FR 
70521, Nov. 22, 2002; 68 FR 13208, Mar. 18, 2003]



Sec.  52.232-17  Interest.

    As prescribed in 32.617 (a) and (b) insert the following clause:

                           Interest (JUN 1996)

    (a) Except as otherwise provided in this contract under a Price 
Reduction for Defective Cost or Pricing Data clause or a Cost Accounting 
Standards clause, all amounts that become payable by the Contractor to 
the Government under this contract (net of any applicable tax credit 
under the Internal Revenue Code (26 U.S.C. 1481)) shall bear simple 
interest from the date due until paid unless paid within 30 days of 
becoming due. The interest rate shall be the interest 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 to 
the period in which the amount becomes due, as provided in paragraph (b) 
of this clause, and then at the rate applicable for each six-month 
period as fixed by the Secretary until the amount is paid.
    (b) Amounts shall be due at the earliest of the following dates:
    (1) The date fixed under this contract.
    (2) The date of the first written demand for payment consistent with 
this contract, including any demand resulting from a default 
termination.
    (3) The date the Government transmits to the Contractor a proposed 
supplemental agreement to confirm completed negotiations establishing 
the amount of debt.
    (4) If this contract provides for revision of prices, the date of 
written notice to the Contractor stating the amount of refund payable in 
connection with a pricing proposal or a negotiated pricing agreement not 
confirmed by contract modification.
    (c) The interest charge made under this clause may be reduced under 
the procedures prescribed in 32.614-2 of the Federal Acquisition 
Regulation in effect on the date of this contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 52799, Dec. 21, 1990; 
61 FR 18922, Apr. 29, 1996]



Sec.  52.232-18  Availability of Funds.

    As prescribed in 32.705-1(a), insert the following clause:

                    Availability of Funds (APR 1984)

    Funds are not presently available for this contract. The 
Government's obligation under this contract is contingent upon the 
availability of appropriated funds from which payment for contract 
purposes can be made. No legal liability on the part of the Government 
for any payment may arise until funds are made available to the 
Contracting Officer for this contract and until the Contractor receives 
notice of such availability, to be confirmed in writing by the 
Contracting Officer.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 67 FR 13054, Mar. 20, 2002]



Sec.  52.232-19  Availability of Funds for the Next Fiscal Year.

    As prescribed in 32.705-1(b), insert the following clause in 
solicitations and contracts if a one-year indefinite-quantity or 
requirements contract for services is contemplated and the contract (a) 
is funded by annual appropriations and (b) is to extend beyond the 
initial fiscal year (see 32.703-2(b)):

        Availability of Funds for the Next Fiscal Year (APR 1984)

    Funds are not presently available for performance under this 
contract beyond ------. The Government's obligation for performance of 
this contract beyond that date is

[[Page 240]]

contingent upon the availability of appropriated funds from which 
payment for contract purposes can be made. No legal liability on the 
part of the Government for any payment may arise for performance under 
this contract beyond ------, until funds are made available to the 
Contracting Officer for performance and until the Contractor receives 
notice of availability, to be confirmed in writing by the Contracting 
Officer.

                             (End of clause)



Sec.  52.232-20  Limitation of Cost.

    As prescribed in 32.705-2(a), insert the following clause in 
solicitations and contracts if a fully funded cost-reimbursement 
contract is contemplated, except those for consolidated facilities, 
facilities acquisition, or facilities use, whether or not the contract 
provides for payment of a fee. The 60-day period may be varied from 30 
to 90 days and the 75 percent from 75 to 85 percent. Task Order or other 
appropriate designation may be substituted for Schedule wherever that 
word appears in the clause.

                      Limitation of Cost (APR 1984)

    (a) The parties estimate that performance of this contract, 
exclusive of any fee, will not cost the Government more than (1) the 
estimated cost specified in the Schedule or, (2) if this is a cost-
sharing contract, the Government's share of the estimated cost specified 
in the Schedule. The Contractor agrees to use its best efforts to 
perform the work specified in the Schedule and all obligations under 
this contract within the estimated cost, which, if this is a cost-
sharing contract, includes both the Government's and the Contractor's 
share of the cost.
    (b) The Contractor shall notify the Contracting Officer in writing 
whenever it has reason to believe that--
    (1) The costs the Contractor expects to incur under this contract in 
the next 60 days, when added to all costs previously incurred, will 
exceed 75 percent of the estimated cost specified in the Schedule; or
    (2) The total cost for the performance of this contract, exclusive 
of any fee, will be either greater or substantially less than had been 
previously estimated.
    (c) As part of the notification, the Contractor shall provide the 
Contracting Officer a revised estimate of the total cost of performing 
this contract.
    (d) Except as required by other provisions of this contract, 
specifically citing and stated to be an exception to this clause--
    (1) The Government is not obligated to reimburse the Contractor for 
costs incurred in excess of (i) the estimated cost specified in the 
Schedule or, (ii) if this is a cost-sharing contract, the estimated cost 
to the Government specified in the Schedule; and
    (2) The Contractor is not obligated to continue performance under 
this contract (including actions under the Termination clause of this 
contract) or otherwise incur costs in excess of the estimated cost 
specified in the Schedule, until the Contracting Officer (i) notifies 
the Contractor in writing that the estimated cost has been increased and 
(ii) provides a revised estimated total cost of performing this 
contract. If this is a cost-sharing contract, the increase shall be 
allocated in accordance with the formula specified in the Schedule.
    (e) No notice, communication, or representation in any form other 
than that specified in subparagraph (d)(2) above, or from any person 
other than the Contracting Officer, shall affect this contract's 
estimated cost to the Government. In the absence of the specified 
notice, the Government is not obligated to reimburse the Contractor for 
any costs in excess of the estimated cost or, if this is a cost-sharing 
contract, for any costs in excess of the estimated cost to the 
Government specified in the Schedule, whether those excess costs were 
incurred during the course of the contract or as a result of 
termination.
    (f) If the estimated cost specified in the Schedule is increased, 
any costs the Contractor incurs before the increase that are in excess 
of the previously estimated cost shall be allowable to the same extent 
as if incurred afterward, unless the Contracting Officer issues a 
termination or other notice directing that the increase is solely to 
cover termination or other specified expenses.
    (g) Change orders shall not be considered an authorization to exceed 
the estimated cost to the Government specified in the Schedule, unless 
they contain a statement increasing the estimated cost.
    (h) If this contract is terminated or the estimated cost is not 
increased, the Government and the Contractor shall negotiate an 
equitable distribution of all property produced or purchased under the 
contract, based upon the share of costs incurred by each.

                             (End of clause)



Sec.  52.232-21  Limitation of Cost (Facilities).

    As prescribed in 32.705-2(b), insert the following clause in 
solicitations and contracts for consolidated facilities, facilities 
acquisition, or facilities use (see 45.301):

               Limitation of Cost (Facilities) (APR 1984)

    (a) The parties estimate that performance of this contract will not 
cost the Government more than the estimated cost specified

[[Page 241]]

in the Schedule. The Contractor agrees to use its best efforts to 
perform the work specified in the Schedule within the estimated cost.
    (b) The Contractor shall notify the Contracting Officer in writing 
whenever it has reason to believe that--
    (1) The costs that the Contractor expects to incur under this 
contract in the next 30 days, when added to all costs previously 
incurred, will exceed 85 percent of the estimated cost specified in the 
Schedule; or
    (2) The total cost to the Government for the performance of this 
contract will be either greater or substantially less than had 
previously been estimated.
    (c) As part of the notification, the Contractor shall provide the 
Contracting Officer a revised estimate of the total cost of performing 
this contract.
    (d) Except as required by other provisions of this contract, 
specifically citing and stated to be an exception to this clause--
    (1) The Government is not obligated to reimburse the contractor for 
costs incurred in excess of the estimated cost specified in the 
Schedule; and
    (2) The Contractor is not obligated to continue performance under 
this contract (including actions under the Termination clause of this 
contract) or otherwise incur costs in excess of the estimated cost 
specified in the Schedule, until the Contracting Officer (i) notifies 
the Contractor in writing that the estimated cost has been increased and 
(ii) provides a revised estimated total cost of performing this 
contract.
    (e) No notice, communication, or representation in any form other 
than that specified in subparagraph (d)(2) above, or from any person 
other than the Contracting Officer, shall affect this contract's 
estimated cost to the Government. In the absence of the specified 
notice, the Government is not obligated to reimburse the Contractor for 
any costs in excess of the estimated cost, whether those excess costs 
were incurred during the course of the contract or as a result of 
termination.
    (f) If the estimated cost specified in the Schedule is increased, 
any costs the Contractor incurs before the increase that are in excess 
of the previously estimated cost shall be allowable to the same extent 
as if incurred afterward, unless the Contracting Officer issues a 
termination or other notice directing that the increase is solely to 
cover termination or other specified expenses.
    (g) Change orders shall not be considered an authorization to exceed 
the estimated cost to the Government specified in the Schedule, unless 
they contain a statement increasing the estimated cost.

                             (End of clause)



Sec.  52.232-22  Limitation of Funds.

    As prescribed in 32.705-2(c), insert the following clause in 
solicitations and contracts if an incrementally funded cost-
reimbursement contract is contemplated. The 60-day period may be varied 
from 30 to 90 days and the 75 percent from 75 to 85 percent. Task Order 
or other appropriate designation may be substituted for Schedule 
wherever that word appears in the clause.

                     Limitation of Funds (APR 1984)

    (a) The parties estimate that performance of this contract will not 
cost the Government more than (1) the estimated cost specified in the 
Schedule or, (2) if this is a cost-sharing contract, the Government's 
share of the estimated cost specified in the Schedule. The Contractor 
agrees to use its best efforts to perform the work specified in the 
Schedule and all obligations under this contract within the estimated 
cost, which, if this is a cost-sharing contract, includes both the 
Government's and the Contractor's share of the cost.
    (b) The Schedule specifies the amount presently available for 
payment by the Government and allotted to this contract, the items 
covered, the Government's share of the cost if this is a cost-sharing 
contract, and the period of performance it is estimated the allotted 
amount will cover. The parties contemplate that the Government will 
allot additional funds incrementally to the contract up to the full 
estimated cost to the Government specified in the Schedule, exclusive of 
any fee. The Contractor agrees to perform, or have performed, work on 
the contract up to the point at which the total amount paid and payable 
by the Government under the contract approximates but does not exceed 
the total amount actually allotted by the Government to the contract.
    (c) The Contractor shall notify the Contracting Officer in writing 
whenever it has reason to believe that the costs it expects to incur 
under this contract in the next 60 days, when added to all costs 
previously incurred, will exceed 75 percent of (1) the total amount so 
far allotted to the contract by the Government or, (2) if this is a 
cost-sharing contract, the amount then allotted to the contract by the 
Government plus the Contractor's corresponding share. The notice shall 
state the estimated amount of additional funds required to continue 
performance for the period specified in the Schedule.
    (d) Sixty days before the end of the period specified in the 
Schedule, the Contractor shall notify the Contracting Officer in writing 
of the estimated amount of additional funds, if any, required to 
continue timely

[[Page 242]]

performance under the contract or for any further period specified in 
the Schedule or otherwise agreed upon, and when the funds will be 
required.
    (e) If, after notification, additional funds are not allotted by the 
end of the period specified in the Schedule or another agreed-upon date, 
upon the Contractor's written request the Contracting Officer will 
terminate this contract on that date in accordance with the provisions 
of the Termination clause of this contract. If the Contractor estimates 
that the funds available will allow it to continue to discharge its 
obligations beyond that date, it may specify a later date in its 
request, and the Contracting Officer may terminate this contract on that 
later date.
    (f) Except as required by other provisions of this contract, 
specifically citing and stated to be an exception to this clause--
    (1) The Government is not obligated to reimburse the Contractor for 
costs incurred in excess of the total amount allotted by the Government 
to this contract; and
    (2) The Contractor is not obligated to continue performance under 
this contract (including actions under the Termination clause of this 
contract) or otherwise incur costs in excess of (i) the amount then 
allotted to the contract by the Government or, (ii) if this is a cost-
sharing contract, the amount then allotted by the Government to the 
contract plus the Contractor's corresponding share, until the 
Contracting Officer notifies the Contractor in writing that the amount 
allotted by the Government has been increased and specifies an increased 
amount, which shall then constitute the total amount allotted by the 
Government to this contract.
    (g) The estimated cost shall be increased to the extent that (1) the 
amount allotted by the Government or, (2) if this is a cost-sharing 
contract, the amount then allotted by the Government to the contract 
plus the Contractor's corresponding share, exceeds the estimated cost 
specified in the Schedule. If this is a cost-sharing contract, the 
increase shall be allocated in accordance with the formula specified in 
the Schedule.
    (h) No notice, communication, or representation in any form other 
than that specified in subparagraph (f)(2) above, or from any person 
other than the Contracting Officer, shall affect the amount allotted by 
the Government to this contract. In the absence of the specified notice, 
the Government is not obligated to reimburse the Contractor for any 
costs in excess of the total amount allotted by the Government to this 
contract, whether incurred during the course of the contract or as a 
result of termination.
    (i) When and to the extent that the amount allotted by the 
Government to the contract is increased, any costs the Contractor incurs 
before the increase that are in excess of (1) the amount previously 
allotted by the Government or, (2) if this is a cost-sharing contract, 
the amount previously allotted by the Government to the contract plus 
the Contractor's corresponding share, shall be allowable to the same 
extent as if incurred afterward, unless the Contracting Officer issues a 
termination or other notice and directs that the increase is solely to 
cover termination or other specified expenses.
    (j) Change orders shall not be considered an authorization to exceed 
the amount allotted by the Government specified in the Schedule, unless 
they contain a statement increasing the amount allotted.
    (k) Nothing in this clause shall affect the right of the Government 
to terminate this contract. If this contract is terminated, the 
Government and the Contractor shall negotiate an equitable distribution 
of all property produced or purchased under the contract, based upon the 
share of costs incurred by each.
    (l) If the Government does not allot sufficient funds to allow 
completion of the work, the Contractor is entitled to a percentage of 
the fee specified in the Schedule equalling the percentage of completion 
of the work contemplated by this contract.

                             (End of clause)



Sec.  52.232-23  Assignment of Claims.

    As prescribed in 32.806(a)(1), insert the following clause:

                     Assignment of Claims (JAN 1986)

    (a) The Contractor, under the Assignment of Claims Act, as amended, 
31 U.S.C. 3727, 41 U.S.C. 15 (hereafter referred to as the Act), may 
assign its rights to be paid amounts due or to become due as a result of 
the performance of this contract to a bank, trust company, or other 
financing institution, including any Federal lending agency. The 
assignee under such an assignment may thereafter further assign or 
reassign its right under the original assignment to any type of 
financing institution described in the preceding sentence.
    (b) Any assignment or reassignment authorized under the Act and this 
clause shall cover all unpaid amounts payable under this contract, and 
shall not be made to more than one party, except that an assignment or 
reassignment may be made to one party as agent or trustee for two or 
more parties participating in the financing of this contract.
    (c) The Contractor shall not furnish or disclose to any assignee 
under this contract any classified document (including this contract) or 
information related to work under this contract until the Contracting 
Officer authorizes such action in writing.

[[Page 243]]

                             (End of clause)

    Alternate I (APR 1984). If a no-setoff commitment is to be included 
in the contract (see 32.801 and 32.803(d)), add the following sentence 
at the end of paragraph (a) of the basic clause:

    Unless otherwise stated in this contract, payments to an assignee of 
any amounts due or to become due under this contract shall not, to the 
extent specified in the Act, be subject to reduction or setoff.

[48 FR 42478, Sept. 19, 1983, as amended at 51 FR 2667, Jan. 17, 1986]



Sec.  52.232-24  Prohibition of Assignment of Claims.

    As prescribed in 32.806(b), insert the following clause:

             Prohibition of Assignment of Claims (JAN 1986)

    The assignment of claims under the Assignment of Claims Act of 1940, 
as amended, 31 U.S.C. 3727, 41 U.S.C. 15, is prohibited for this 
contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 51 FR 2667, Jan. 17, 1986]



Sec.  52.232-25  Prompt payment.

    As prescribed in 32.908(c), insert the following clause:

                        Prompt Payment (Feb 2002)

    Notwithstanding any other payment clause in this contract, the 
Government will make invoice payments under the terms and conditions 
specified in this clause. The Government considers payment as being made 
on the day a check is dated or the date of an electronic funds transfer 
(EFT). Definitions of pertinent terms are set forth in sections 2.101, 
32.001, and 32.902 of the Federal Acquisition Regulation. All days 
referred to in this clause are calendar days, unless otherwise 
specified. (However, see paragraph (a)(4) of this clause concerning 
payments due on Saturdays, Sundays, and legal holidays.)
    (a) Invoice payments--(1) Due date. (i) Except as indicated in 
paragraphs (a)(2) and (c) of this clause, the due date for making 
invoice payments by the designated payment office is the later of the 
following two events:
    (A) The 30th day after the designated billing office receives a 
proper invoice from the Contractor (except as provided in paragraph 
(a)(1)(ii) of this clause).
    (B) The 30th day after Government acceptance of supplies delivered 
or services performed. For a final invoice, when the payment amount is 
subject to contract settlement actions, acceptance is deemed to occur on 
the effective date of the contract settlement.
    (ii) If the designated billing office fails to annotate the invoice 
with the actual date of receipt at the time of receipt, the invoice 
payment due date is the 30th day after the date of the Contractor's 
invoice, provided the designated billing office receives a proper 
invoice and there is no disagreement over quantity, quality, or 
Contractor compliance with contract requirements.
    (2) Certain food products and other payments. (i) Due dates on 
Contractor invoices for meat, meat food products, or fish; perishable 
agricultural commodities; and dairy products, edible fats or oils, and 
food products prepared from edible fats or oils are--
    (A) For meat or meat food products, as defined in section 2(a)(3) of 
the Packers and Stockyard Act of 1921 (7 U.S.C. 182(3)), and as further 
defined in Pub. L. 98-181, including any edible fresh or frozen poultry 
meat, any perishable poultry meat food product, fresh eggs, and any 
perishable egg product, as close as possible to, but not later than, the 
7th day after product delivery.
    (B) For fresh or frozen fish, as defined in section 204(3) of the 
Fish and Seafood Promotion Act of 1986 (16 U.S.C. 4003(3)), as close as 
possible to, but not later than, the 7th day after product delivery.
    (C) For perishable agricultural commodities, as defined in section 
1(4) of the Perishable Agricultural Commodities Act of 1930 (7 U.S.C. 
499a(4)), as close as possible to, but not later than, the 10th day 
after product delivery, unless another date is specified in the 
contract.
    (D) For dairy products, as defined in section 111(e) of the Dairy 
Production Stabilization Act of 1983 (7 U.S.C. 4502(e)), edible fats or 
oils, and food products prepared from edible fats or oils, as close as 
possible to, but not later than, the 10th day after the date on which a 
proper invoice has been received. Liquid milk, cheese, certain processed 
cheese products, butter, yogurt, ice cream, mayonnaise, salad dressings, 
and other similar products, fall within this classification. Nothing in 
the Act limits this classification to refrigerated products. When 
questions arise regarding the proper classification of a specific 
product, prevailing industry practices will be followed in specifying a 
contract payment due date. The burden of proof that a classification of 
a specific product is, in fact, prevailing industry practice is upon the 
Contractor making the representation.
    (ii) If the contract does not require submission of an invoice for 
payment (e.g., periodic lease payments), the due date will be as 
specified in the contract.

[[Page 244]]

    (3) Contractor's invoice. The Contractor shall prepare and submit 
invoices to the designated billing office specified in the contract. A 
proper invoice must include the items listed in paragraphs (a)(3)(i) 
through (a)(3)(x) of this clause. If the invoice does not comply with 
these requirements, the designated billing office will return it within 
7 days after receipt (3 days for meat, meat food products, or fish; 5 
days for perishable agricultural commodities, dairy products, edible 
fats or oils, and food products prepared from edible fats or oils), with 
the reasons why it is not a proper invoice. The Government will take 
into account untimely notification when computing any interest penalty 
owed the Contractor.
    (i) Name and address of the Contractor.
    (ii) Invoice date and invoice number. (The Contractor should date 
invoices as close as possible to the date of the mailing or 
transmission.)
    (iii) Contract number or other authorization for supplies delivered 
or services performed (including order number and contract line item 
number).
    (iv) Description, quantity, unit of measure, unit price, and 
extended price of supplies delivered or services performed.
    (v) Shipping and payment terms (e.g., shipment number and date of 
shipment, discount for prompt payment terms). Bill of lading number and 
weight of shipment will be shown for shipments on Government bills of 
lading.
    (vi) Name and address of Contractor official to whom payment is to 
be sent (must be the same as that in the contract or in a proper notice 
of assignment).
    (vii) Name (where practicable), title, phone number, and mailing 
address of person to notify in the event of a defective invoice.
    (viii) Taxpayer Identification Number (TIN). The Contractor shall 
include its TIN on the invoice only if required elsewhere in this 
contract.
    (ix) Electronic funds transfer (EFT) banking information.
    (A) The Contractor shall include EFT banking information on the 
invoice only if required elsewhere in this contract.
    (B) If EFT banking information is not required to be on the invoice, 
in order for the invoice to be a proper invoice, the Contractor shall 
have submitted correct EFT banking information in accordance with the 
applicable solicitation provision (e.g., 52.232-38, Submission of 
Electronic Funds Transfer Information with Offer), contract clause 
(e.g., 52.232-33, Payment by Electronic Funds Transfer--Central 
Contractor Registration, or 52.232-34, Payment by Electronic Funds 
Transfer--Other Than Central Contractor Registration), or applicable 
agency procedures.
    (C) EFT banking information is not required if the Government waived 
the requirement to pay by EFT.
    (x) Any other information or documentation required by the contract 
(e.g., evidence of shipment).
    (4) Interest penalty. The designated payment office will pay an 
interest penalty automatically, without request from the Contractor, if 
payment is not made by the due date and the conditions listed in 
paragraphs (a)(4)(i) through (a)(4)(iii) of this clause are met, if 
applicable. However, when the due date falls on a Saturday, Sunday, or 
legal holiday, the designated payment office may make payment on the 
following working day without incurring a late payment interest penalty.
    (i) The designated billing office received a proper invoice.
    (ii) The Government processed a receiving report or other Government 
documentation authorizing payment, and there was no disagreement over 
quantity, quality, or Contractor compliance with any contract term or 
condition.
    (iii) In the case of a final invoice for any balance of funds due 
the Contractor for supplies delivered or services performed, the amount 
was not subject to further contract settlement actions between the 
Government and the Contractor.
    (5) Computing penalty amount. The Government will compute the 
interest penalty in accordance with the Office of Management and Budget 
prompt payment regulations at 5 CFR part 1315.
    (i) For the sole purpose of computing an interest penalty that might 
be due the Contractor, Government acceptance is deemed to occur 
constructively on the 7th day (unless otherwise specified in this 
contract) after the Contractor delivers the supplies or performs the 
services in accordance with the terms and conditions of the contract, 
unless there is a disagreement over quantity, quality, or Contractor 
compliance with a contract provision. If actual acceptance occurs within 
the constructive acceptance period, the Government will base the 
determination of an interest penalty on the actual date of acceptance. 
The constructive acceptance requirement does not, however, compel 
Government officials to accept supplies or services, perform contract 
administration functions, or make payment prior to fulfilling their 
responsibilities.
    (ii) The prompt payment regulations at 5 CFR 1315.10(c) do not 
require the Government to pay interest penalties if payment delays are 
due to disagreement between the Government and the Contractor over the 
payment amount or other issues involving contract compliance, or on 
amounts temporarily withheld or retained in accordance with the terms of 
the contract. The Government and the Contractor shall resolve claims

[[Page 245]]

involving disputes and any interest that may be payable in accordance 
with the clause at FAR 52.233-1, Disputes.
    (6) Discounts for prompt payment. The designated payment office will 
pay an interest penalty automatically, without request from the 
Contractor, if the Government takes a discount for prompt payment 
improperly. The Government will calculate the interest penalty in 
accordance with the prompt payment regulations at 5 CFR part 1315.
    (7) Additional interest penalty. (i) The designated payment office 
will pay a penalty amount, calculated in accordance with the prompt 
payment regulations at 5 CFR part 1315 in addition to the interest 
penalty amount only if--
    (A) The Government owes an interest penalty of $1 or more;
    (B) The designated payment office does not pay the interest penalty 
within 10 days after the date the invoice amount is paid; and
    (C) The Contractor makes a written demand to the designated payment 
office for additional penalty payment, in accordance with paragraph 
(a)(7)(ii) of this clause, postmarked not later than 40 days after the 
invoice amount is paid.
    (ii)(A) The Contractor shall support written demands for additional 
penalty payments with the following data. The Government will not 
request any additional data. The Contractor shall--
    (1) Specifically assert that late payment interest is due under a 
specific invoice, and request payment of all overdue late payment 
interest penalty and such additional penalty as may be required;
    (2) Attach a copy of the invoice on which the unpaid late payment 
interest is due; and
    (3) State that payment of the principal has been received, including 
the date of receipt.
    (B) If there is no postmark or the postmark is illegible--
    (1) The designated payment office that receives the demand will 
annotate it with the date of receipt, provided the demand is received on 
or before the 40th day after payment was made; or
    (2) If the designated payment office fails to make the required 
annotation, the Government will determine the demand's validity based on 
the date the Contractor has placed on the demand, provided such date is 
no later than the 40th day after payment was made.
    (iii) The additional penalty does not apply to payments regulated by 
other Government regulations (e.g., payments under utility contracts 
subject to tariffs and regulation).
    (b) Contract financing payment. If this contract provides for 
contract financing, the Government will make contract financing payments 
in accordance with the applicable contract financing clause.
    (c) Fast payment procedure due dates. If this contract contains the 
clause at 52.213-1, Fast Payment Procedure, payments will be made within 
15 days after the date of receipt of the invoice.
    (d) Overpayments. If the Contractor becomes aware of a duplicate 
payment or that the Government has otherwise overpaid on an invoice 
payment, the Contractor shall immediately notify the Contracting Officer 
and request instructions for disposition of the overpayment.

                             (End of clause)

    Alternate I (Feb 2002). As prescribed in 32.908(c)(3), add the 
following paragraph (e) to the basic clause:

    (e) Invoices for interim payments. For interim payments under this 
cost-reimbursement contract for services--
    (1) Paragraphs (a)(2), (a)(3), (a)(4)(ii), (a)(4)(iii), and 
(a)(5)(i) do not apply;
    (2) For purposes of computing late payment interest penalties that 
may apply, the due date for payment is the 30th day after the designated 
billing office receives a proper invoice; and
    (3) The contractor shall submit invoices for interim payments in 
accordance with paragraph (a) of FAR 52.216-7, Allowable Cost and 
Payment. If the invoice does not comply with contract requirements, it 
will be returned within 7 days after the date the designated billing 
office received the invoice.

[66 FR 65361, Dec. 18, 2001]

    Effective Date Note: At 68 FR 56684, Oct. 1, 2003, Sec.  52.232-25 
was amended by revising the date of the clause and paragraph (d), 
effective Oct. 31, 2003. For the convenience of the user, the revised 
text is set forth below:

Sec.  52.232-25  Prompt Payment.

                                * * * * *

                       Prompt Payment (Oct. 2003).

                                * * * * *

    (d) Overpayments. If the Contractor becomes aware of a duplicate 
contract financing or invoice payment or that the Government has 
otherwise overpaid on a contract financing or invoice payment, the 
Contractor shall immediately notify the Contracting Officer and request 
instructions for disposition of the overpayment.
    (End of clause)

                                * * * * *



Sec.  52.232-26  Prompt payment for fixed-price architect-engineer contracts.

    As prescribed in 32.908(a), insert the following clause:

[[Page 246]]

 Prompt Payment for Fixed-Price Architect-Engineer Contracts (FEB 2002)

    Notwithstanding any other payment terms in this contract, the 
Government will make invoice payments under the terms and conditions 
specified in this clause. The Government considers payment as being made 
on the day a check is dated or the date of an electronic funds transfer. 
Definitions of pertinent terms are set forth in sections 2.101, 32.001, 
and 32.902 of the Federal Acquisition Regulation. All days referred to 
in this clause are calendar days, unless otherwise specified. (However, 
see paragraph (a)(3) of this clause concerning payments due on 
Saturdays, Sundays, and legal holidays.)
    (a) Invoice payments--(1) Due date. The due date for making invoice 
payments is--
    (i) For work or services completed by the Contractor, the later of 
the following two events:
    (A) The 30th day after the designated billing office receives a 
proper invoice from the Contractor (except as provided in paragraph 
(a)(1)(iii) of this clause).
    (B) The 30th day after Government acceptance of the work or services 
completed by the Contractor. For a final invoice, when the payment 
amount is subject to contract settlement actions (e.g., release of 
claims), acceptance is deemed to occur on the effective date of the 
settlement.
    (ii) The due date for progress payments is the 30th day after 
Government approval of Contractor estimates of work or services 
accomplished.
    (iii) If the designated billing office fails to annotate the invoice 
or payment request with the actual date of receipt at the time of 
receipt, the payment due date is the 30th day after the date of the 
Contractor's invoice or payment request, provided the designated billing 
office receives a proper invoice or payment request and there is no 
disagreement over quantity, quality, or Contractor compliance with 
contract requirements.
    (2) Contractor's invoice. The Contractor shall prepare and submit 
invoices to the designated billing office specified in the contract. A 
proper invoice must include the items listed in paragraphs (a)(2)(i) 
through (a)(2)(x) of this clause. If the invoice does not comply with 
these requirements, the designated billing office will return it within 
7 days after receipt, with the reasons why it is not a proper invoice. 
When computing any interest penalty owed the Contractor, the Government 
will take into account if the Government notifies the Contractor of an 
improper invoice in an untimely manner.
    (i) Name and address of the Contractor.
    (ii) Invoice date and invoice number. (The Contractor should date 
invoices as close as possible to the date of mailing or transmission.)
    (iii) Contract number or other authorization for work or services 
performed (including order number and contract line item number).
    (iv) Description of work or services performed.
    (v) Delivery and payment terms (e.g., discount for prompt payment 
terms).
    (vi) Name and address of Contractor official to whom payment is to 
be sent (must be the same as that in the contract or in a proper notice 
of assignment).
    (vii) Name (where practicable), title, phone number, and mailing 
address of person to notify in the event of a defective invoice.
    (viii) Taxpayer Identification Number (TIN). The Contractor shall 
include its TIN on the invoice only if required elsewhere in this 
contract.
    (ix) Electronic funds transfer (EFT) banking information.
    (A) The Contractor shall include EFT banking information on the 
invoice only if required elsewhere in this contract.
    (B) If EFT banking information is not required to be on the invoice, 
in order for the invoice to be a proper invoice, the Contractor shall 
have submitted correct EFT banking information in accordance with the 
applicable solicitation provision (e.g., 52.232-38, Submission of 
Electronic Funds Transfer Information with Offer), contract clause 
(e.g., 52.232-33, Payment by Electronic Funds Transfer--Central 
Contractor Registration, or 52.232-34,Payment by Electronic Funds 
Transfer--Other Than Central Contractor Registration), or applicable 
agency procedures.
    (C) EFT banking information is not required if the Government waived 
the requirement to pay by EFT.
    (x) Any other information or documentation required by the contract.
    (3) Interest penalty. The designated payment office will pay an 
interest penalty automatically, without request from the Contractor, if 
payment is not made by the due date and the conditions listed in 
paragraphs (a)(3)(i) through (a)(3)(iii) of this clause are met, if 
applicable. However, when the due date falls on a Saturday, Sunday, or 
legal holiday, the designated payment office may make payment on the 
following working day without incurring a late payment interest penalty.
    (i) The designated billing office received a proper invoice.
    (ii) The Government processed a receiving report or other Government 
documentation authorizing payment and there was no disagreement over 
quantity, quality, Contractor compliance with any contract term or 
condition, or requested progress payment amount.
    (iii) In the case of a final invoice for any balance of funds due 
the Contractor for work or services performed, the amount was not

[[Page 247]]

subject to further contract settlement actions between the Government 
and the Contractor.
    (4) Computing penalty amount. The Government will compute the 
interest penalty in accordance with the Office of Management and Budget 
prompt payment regulations at 5 CFR part 1315.
    (i) For the sole purpose of computing an interest penalty that might 
be due the Contractor, Government acceptance or approval is deemed to 
occur constructively as shown in paragraphs (a)(4)(i)(A) and (B) of this 
clause. If actual acceptance or approval occurs within the constructive 
acceptance or approval period, the Government will base the 
determination of an interest penalty on the actual date of acceptance or 
approval. Constructive acceptance or constructive approval requirements 
do not apply if there is a disagreement over quantity, quality, 
Contractor compliance with a contract provision, or requested progress 
payment amounts. These requirements also do not compel Government 
officials to accept work or services, approve Contractor estimates, 
perform contract administration functions, or make payment prior to 
fulfilling their responsibilities.
    (A) For work or services completed by the Contractor, Government 
acceptance is deemed to occur constructively on the 7th day after the 
Contractor completes the work or services in accordance with the terms 
and conditions of the contract.
    (B) For progress payments, Government approval is deemed to occur on 
the 7th day after the designated billing office receives the Contractor 
estimates.
    (ii) The prompt payment regulations at 5 CFR 1315.10(c) do not 
require the Government to pay interest penalties if payment delays are 
due to disagreement between the Government and the Contractor over the 
payment amount or other issues involving contract compliance, or on 
amounts temporarily withheld or retained in accordance with the terms of 
the contract. The Government and the Contractor shall resolve claims 
involving disputes, and any interest that may be payable in accordance 
with the clause at FAR 52.233-1, Disputes.
    (5) Discounts for prompt payment. The designated payment office will 
pay an interest penalty automatically, without request from the 
Contractor, if the Government takes a discount for prompt payment 
improperly. The Government will calculate the interest penalty in 
accordance with 5 CFR part 1315.
    (6) Additional interest penalty. (i) The designated payment office 
will pay a penalty amount, calculated in accordance with the prompt 
payment regulations at 5 CFR part 1315, in addition to the interest 
penalty amount only if--
    (A) The Government owes an interest penalty of $1 or more;
    (B) The designated payment office does not pay the interest penalty 
within 10 days after the date the invoice amount is paid; and
    (C) The contractor makes a written demand to the designated payment 
office for additional penalty payment, in accordance with paragraph 
(a)(6)(ii) of this clause, postmarked not later than 40 days after the 
date the invoice amount is paid.
    (ii)(A) The Contractor shall support written demands for additional 
penalty payments with the following data. The Government will not 
request any additional data. The Contractor shall--
    (1) Specifically assert that late payment interest is due under a 
specific invoice, and request payment of all overdue late payment 
interest penalty and such additional penalty as may be required;
    (2) Attach a copy of the invoice on which the unpaid late payment 
interest is due; and
    (3) State that payment of the principal has been received, including 
the date of receipt.
    (B) If there is no postmark or the postmark is illegible--
    (1) The designated payment office that receives the demand will 
annotate it with the date of receipt, provided the demand is received on 
or before the 40th day after payment was made; or
    (2) If the designated payment office fails to make the required 
annotation, the Government will determine the demand's validity based on 
the date the Contractor has placed on the demand, provided such date is 
no later than the 40th day after payment was made.
    (iii) The additional penalty does not apply to payments regulated by 
other Government regulations (e.g., payments under utility contracts 
subject to tariffs and regulation).
    (b) Contract financing payments. If this contract provides for 
contract financing, the Government will make contract financing payments 
in accordance with the applicable contract financing clause.
    (c) Overpayments. If the Contractor becomes aware of a duplicate 
payment or that the Government has otherwise overpaid on an invoice 
payment, the Contractor shall immediately notify the Contracting Officer 
and request instructions for disposition of the overpayment.

                             (End of clause)

[66 FR 65363, Dec. 18, 2001]

    Effective Date Note: At 68 FR 56684, Oct. 1, 2003, Sec.  52.232-26 
was amended by revising the date of the clause and paragraph (c), 
effective Oct. 31, 2003. For the convenience of the user, the revised 
text is set forth below:

[[Page 248]]

Sec.  52.232-26  Prompt Payment for Fixed-Price Architect-Engineer 
          Contracts.

                                * * * * *

Prompt Payment for Fixed-Price Architect-Engineer Contracts (Oct. 2003).

                                * * * * *

    (c) Overpayments. If the Contractor becomes aware of a duplicate 
contract financing or invoice payment or that the Government has 
otherwise overpaid on a contract financing or invoice payment, the 
Contractor shall immediately notify the Contracting Officer and request 
instructions for disposition of the overpayment.
    (End of clause)



Sec.  52.232-27  Prompt payment for construction contracts.

    As prescribed in 32.908(b), insert the following clause:

          Prompt Payment for Construction Contracts (Feb 2002)

    Notwithstanding any other payment terms in this contract, the 
Government will make invoice payments under the terms and conditions 
specified in this clause. The Government considers payment as being made 
on the day a check is dated or the date of an electronic funds 
transfer.Definitions of pertinent terms are set forth in sections 2.101, 
32.001, and 32.902 of the Federal Acquisition Regulation. All days 
referred to in this clause are calendar days, unless otherwise 
specified. (However, see paragraph (a)(3) concerning payments due on 
Saturdays, Sundays, and legal holidays.)
    (a) Invoice payments--(1) Types of invoice payments. For purposes of 
this clause, there are several types of invoice payments that may occur 
under this contract, as follows:
    (i) Progress payments, if provided for elsewhere in this contract, 
based on Contracting Officer approval of the estimated amount and value 
of work or services performed, including payments for reaching 
milestones in any project.
    (A) The due date for making such payments is 14 days after the 
designated billing office receives a proper payment request. If the 
designated billing office fails to annotate the payment request with the 
actual date of receipt at the time of receipt, the payment due date is 
the 14th day after the date of the Contractor's payment request, 
provided the designated billing office receives a proper payment request 
and there is no disagreement over quantity, quality, or Contractor 
compliance with contract requirements.
    (B) The due date for payment of any amounts retained by the 
Contracting Officer in accordance with the clause at 52.232-5, Payments 
Under Fixed-Price Construction Contracts, is as specified in the 
contract or, if not specified, 30 days after approval by the Contracting 
Officer for release to the Contractor.
    (ii) Final payments based on completion and acceptance of all work 
and presentation of release of all claims against the Government arising 
by virtue of the contract, and payments for partial deliveries that have 
been accepted by the Government (e.g., each separate building, public 
work, or other division of the contract for which the price is stated 
separately in the contract).
    (A) The due date for making such payments is the later of the 
following two events:
    (1) The 30th day after the designated billing office receives a 
proper invoice from the Contractor.
    (2) The 30th day after Government acceptance of the work or services 
completed by the Contractor. For a final invoice when the payment amount 
is subject to contract settlement actions (e.g., release of claims), 
acceptance is deemed to occur on the effective date of the contract 
settlement.
    (B) If the designated billing office fails to annotate the invoice 
with the date of actual receipt at the time of receipt, the invoice 
payment due date is the 30th day after the date of the Contractor's 
invoice, provided the designated billing office receives a proper 
invoice and there is no disagreement over quantity, quality, or 
Contractor compliance with contract requirements.
    (2) Contractor's invoice. The Contractor shall prepare and submit 
invoices to the designated billing office specified in the contract. A 
proper invoice must include the items listed in paragraphs (a)(2)(i) 
through (a)(2)(xi) of this clause. If the invoice does not comply with 
these requirements, the designated billing office must return it within 
7 days after receipt, with the reasons why it is not a proper invoice. 
When computing any interest penalty owed the Contractor, the Government 
will take into account if the Government notifies the Contractor of an 
improper invoice in an untimely manner.
    (i) Name and address of the Contractor.
    (ii) Invoice date and invoice number. (The Contractor should date 
invoices as close as possible to the date of mailing or transmission.)
    (iii) Contract number or other authorization for work or services 
performed (including order number and contract line item number).
    (iv) Description of work or services performed.
    (v) Delivery and payment terms (e.g., discount for prompt payment 
terms).
    (vi) Name and address of Contractor official to whom payment is to 
be sent (must be the same as that in the contract or in a proper notice 
of assignment).

[[Page 249]]

    (vii) Name (where practicable), title, phone number, and mailing 
address of person to notify in the event of a defective invoice.
    (viii) For payments described in paragraph (a)(1)(i) of this clause, 
substantiation of the amounts requested and certification in accordance 
with the requirements of the clause at 52.232-5, Payments Under Fixed-
Price Construction Contracts.
    (ix) Taxpayer Identification Number (TIN). The Contractor shall 
include its TIN on the invoice only if required elsewhere in this 
contract.
    (x) Electronic funds transfer (EFT) banking information.
    (A) The Contractor shall include EFT banking information on the 
invoice only if required elsewhere in this contract.
    (B) If EFT banking information is not required to be on the invoice, 
in order for the invoice to be a proper invoice, the Contractor shall 
have submitted correct EFT banking information in accordance with the 
applicable solicitation provision (e.g., 52.232-38, Submission of 
Electronic Funds Transfer Information with Offer), contract clause 
(e.g., 52.232-33, Payment by Electronic Funds Transfer--Central 
Contractor Registration, or 52.232-34, Payment by Electronic Funds 
Transfer--Other Than Central Contractor Registration), or applicable 
agency procedures.
    (C) EFT banking information is not required if the Government waived 
the requirement to pay by EFT.
    (xi) Any other information or documentation required by the 
contract.
    (3) Interest penalty. The designated payment office will pay an 
interest penalty automatically, without request from the Contractor, if 
payment is not made by the due date and the conditions listed in 
paragraphs (a)(3)(i) through (a)(3)(iii) of this clause are met, if 
applicable. However, when the due date falls on a Saturday, Sunday, or 
legal holiday, the designated payment office may make payment on the 
following working day without incurring a late payment interest penalty.
    (i) The designated billing office received a proper invoice.
    (ii) The Government processed a receiving report or other Government 
documentation authorizing payment and there was no disagreement over 
quantity, quality, Contractor compliance with any contract term or 
condition, or requested progress payment amount.
    (iii) In the case of a final invoice for any balance of funds due 
the Contractor for work or services performed, the amount was not 
subject to further contract settlement actions between the Government 
and the Contractor.
    (4) Computing penalty amount. The Government will compute the 
interest penalty in accordance with the Office of Management and Budget 
prompt payment regulations at 5 CFR part 1315.
    (i) For the sole purpose of computing an interest penalty that might 
be due the Contractor for payments described in paragraph (a)(1)(ii) of 
this clause, Government acceptance or approval is deemed to occur 
constructively on the 7th day after the Contractor has completed the 
work or services in accordance with the terms and conditions of the 
contract. If actual acceptance or approval occurs within the 
constructive acceptance or approval period, the Government will base the 
determination of an interest penalty on the actual date of acceptance or 
approval. Constructive acceptance or constructive approval requirements 
do not apply if there is a disagreement over quantity, quality, or 
Contractor compliance with a contract provision. These requirements also 
do not compel Government officials to accept work or services, approve 
Contractor estimates, perform contract administration functions, or make 
payment prior to fulfilling their responsibilities.
    (ii) The prompt payment regulations at 5 CFR 1315.10(c) do not 
require the Government to pay interest penalties if payment delays are 
due to disagreement between the Government and the Contractor over the 
payment amount or other issues involving contract compliance, or on 
amounts temporarily withheld or retained in accordance with the terms of 
the contract. The Government and the Contractor shall resolve claims 
involving disputes, and any interest that may be payable in accordance 
with the clause at FAR 52.233-1, Disputes.
    (5) Discounts for prompt payment. The designated payment office will 
pay an interest penalty automatically, without request from the 
Contractor, if the Government takes a discount for prompt payment 
improperly. The Government will calculate the interest penalty in 
accordance with the prompt payment regulations at 5 CFR part 1315.
    (6) Additional interest penalty. (i) The designated payment office 
will pay a penalty amount, calculated in accordance with the prompt 
payment regulations at 5 CFR part 1315 in addition to the interest 
penalty amount only if--
    (A) The Government owes an interest penalty of $1 or more;
    (B) The designated payment office does not pay the interest penalty 
within 10 days after the date the invoice amount is paid; and
    (C) The Contractor makes a written demand to the designated payment 
office for additional penalty payment, in accordance with paragraph 
(a)(6)(ii) of this clause, postmarked not later than 40 days after the 
date the invoice amount is paid.

[[Page 250]]

    (ii)(A) The Contractor shall support written demands for additional 
penalty payments with the following data. The Government will not 
request any additional data. The Contractor shall--
    (1) Specifically assert that late payment interest is due under a 
specific invoice, and request payment of all overdue late payment 
interest penalty and such additional penalty as may be required;
    (2) Attach a copy of the invoice on which the unpaid late payment 
interest was due; and
    (3) State that payment of the principal has been received, including 
the date of receipt.
    (B) If there is no postmark or the postmark is illegible--
    (1) The designated payment office that receives the demand will 
annotate it with the date of receipt provided the demand is received on 
or before the 40th day after payment was made; or
    (2) If the designated payment office fails to make the required 
annotation, the Government will determine the demand's validity based on 
the date the Contractor has placed on the demand, provided such date is 
no later than the 40th day after payment was made.
    (b) Contract financing payments. If this contract provides for 
contract financing, the Government will make contract financing payments 
in accordance with the applicable contract financing clause.
    (c) Subcontract clause requirements. The Contractor shall include in 
each subcontract for property or services (including a material 
supplier) for the purpose of performing this contract the following:
    (1) Prompt payment for subcontractors. A payment clause that 
obligates the Contractor to pay the subcontractor for satisfactory 
performance under its subcontract not later than 7 days from receipt of 
payment out of such amounts as are paid to the Contractor under this 
contract.
    (2) Interest for subcontractors. An interest penalty clause that 
obligates the Contractor to pay to the subcontractor an interest penalty 
for each payment not made in accordance with the payment clause--
    (i) For the period beginning on the day after the required payment 
date and ending on the date on which payment of the amount due is made; 
and
    (ii) Computed at the rate of interest established by the Secretary 
of the Treasury, and published in the Federal Register, for interest 
payments under section 12 of the Contract Disputes Act of 1978 (41 
U.S.C. 611) in effect at the time the Contractor accrues the obligation 
to pay an interest penalty.
    (3) Subcontractor clause flowdown. A clause requiring each 
subcontractor tou
    (i) Include a payment clause and an interest penalty clause 
conforming to the standards set forth in paragraphs (c)(1) and (c)(2) of 
this clause in each of its subcontracts; and
    (ii) Require each of its subcontractors to include such clauses in 
their subcontracts with each lower-tier subcontractor or supplier.
    (d) Subcontract clause interpretation. The clauses required by 
paragraph (c) of this clause shall not be construed to impair the right 
of the Contractor or a subcontractor at any tier to negotiate, and to 
include in their subcontract, provisions that--
    (1) Retainage permitted. Permit the Contractor or a subcontractor to 
retain (without cause) a specified percentage of each progress payment 
otherwise due to a subcontractor for satisfactory performance under the 
subcontract without incurring any obligation to pay a late payment 
interest penalty, in accordance with terms and conditions agreed to by 
the parties to the subcontract, giving such recognition as the parties 
deem appropriate to the ability of a subcontractor to furnish a 
performance bond and a payment bond;
    (2) Withholding permitted. Permit the Contractor or subcontractor to 
make a determination that part or all of the subcontractor's request for 
payment may be withheld in accordance with the subcontract agreement; 
and
    (3) Withholding requirements. Permit such withholding without 
incurring any obligation to pay a late payment penalty if--
    (i) A notice conforming to the standards of paragraph (g) of this 
clause previously has been furnished to the subcontractor; and
    (ii) The Contractor furnishes to the Contracting Officer a copy of 
any notice issued by a Contractor pursuant to paragraph (d)(3)(i) of 
this clause.
    (e) Subcontractor withholding procedures. If a Contractor, after 
making a request for payment to the Government but before making a 
payment to a subcontractor for the subcontractor's performance covered 
by the payment request, discovers that all or a portion of the payment 
otherwise due such subcontractor is subject to withholding from the 
subcontractor in accordance with the subcontract agreement, then the 
Contractor shall--
    (1) Subcontractor notice. Furnish to the subcontractor a notice 
conforming to the standards of paragraph (g) of this clause as soon as 
practicable upon ascertaining the cause giving rise to a withholding, 
but prior to the due date for subcontractor payment;
    (2) Contracting Officer notice. Furnish to the Contracting Officer, 
as soon as practicable, a copy of the notice furnished to the 
subcontractor pursuant to paragraph (e)(1) of this clause;
    (3) Subcontractor progress payment reduction. Reduce the 
subcontractor's progress payment by an amount not to exceed the

[[Page 251]]

amount specified in the notice of withholding furnished under paragraph 
(e)(1) of this clause;
    (4) Subsequent subcontractor payment. Pay the subcontractor as soon 
as practicable after the correction of the identified subcontract 
performance deficiency, and--
    (i) Make such payment within--
    (A) Seven days after correction of the identified subcontract 
performance deficiency (unless the funds therefor must be recovered from 
the Government because of a reduction under paragraph (e)(5)(i)) of this 
clause; or
    (B) Seven days after the Contractor recovers such funds from the 
Government; or
    (ii) Incur an obligation to pay a late payment interest penalty 
computed at the rate of interest established by the Secretary of the 
Treasury, and published in the Federal Register, for interest payments 
under section 12 of the Contracts Disputes Act of 1978 (41 U.S.C. 611) 
in effect at the time the Contractor accrues the obligation to pay an 
interest penalty;
    (5) Notice to Contracting Officer. Notify the Contracting Officer 
upon--
    (i) Reduction of the amount of any subsequent certified application 
for payment; or
    (ii) Payment to the subcontractor of any withheld amounts of a 
progress payment, specifying--
    (A) The amounts withheld under paragraph (e)(1) of this clause; and
    (B) The dates that such withholding began and ended; and
    (6) Interest to Government. Be obligated to pay to the Government an 
amount equal to interest on the withheld payments (computed in the 
manner provided in 31 U.S.C. 3903(c)(1)), from the 8th day after receipt 
of the withheld amounts from the Government until--
    (i) The day the identified subcontractor performance deficiency is 
corrected; or
    (ii) The date that any subsequent payment is reduced under paragraph 
(e)(5)(i) of this clause.
    (f) Third-party deficiency reports--(1) Withholding from 
subcontractor. If a Contractor, after making payment to a first-tier 
subcontractor, receives from a supplier or subcontractor of the first-
tier subcontractor (hereafter referred to as a ``second-tier 
subcontractor'') a written notice in accordance with section 2 of the 
Act of August 24, 1935 (40 U.S.C. 270b, Miller Act), asserting a 
deficiency in such first-tier subcontractor's performance under the 
contract for which the Contractor may be ultimately liable, and the 
Contractor determines that all or a portion of future payments otherwise 
due such first-tier subcontractor is subject to withholding in 
accordance with the subcontract agreement, the Contractor may, without 
incurring an obligation to pay an interest penalty under paragraph 
(e)(6) of this clause--
    (i) Furnish to the first-tier subcontractor a notice conforming to 
the standards of paragraph (g) of this clause as soon as practicable 
upon making such determination; and
    (ii) Withhold from the first-tier subcontractor's next available 
progress payment or payments an amount not to exceed the amount 
specified in the notice of withholding furnished under paragraph 
(f)(1)(i) of this clause.
    (2) Subsequent payment or interest charge. As soon as practicable, 
but not later than 7 days after receipt of satisfactory written 
notification that the identified subcontract performance deficiency has 
been corrected, the Contractor shall--
    (i) Pay the amount withheld under paragraph (f)(1)(ii) of this 
clause to such first-tier subcontractor; or
    (ii) Incur an obligation to pay a late payment interest penalty to 
such first-tier subcontractor computed at the rate of interest 
established by the Secretary of the Treasury, and published in the 
Federal Register, for interest payments under section 12 of the 
Contracts DisputesAct of 1978 (41 U.S.C. 611) in effect at the time the 
Contractor accrues the obligation to pay an interest penalty.
    (g) Written notice of subcontractor withholding. The Contractor 
shall issue a written notice of any withholding to a subcontractor (with 
a copy furnished to the Contracting Officer), specifying--
    (1) The amount to be withheld;
    (2) The specific causes for the withholding under the terms of the 
subcontract; and
    (3) The remedial actions to be taken by the subcontractor in order 
to receive payment of the amounts withheld.
    (h) Subcontractor payment entitlement. The Contractor may not 
request payment from the Government of any amount withheld or retained 
in accordance with paragraph (d) of this clause until such time as the 
Contractor has determined and certified to the Contracting Officer that 
the subcontractor is entitled to the payment of such amount.
    (i) Prime-subcontractor disputes. A dispute between the Contractor 
and subcontractor relating to the amount or entitlement of a 
subcontractor to a payment or a late payment interest penalty under a 
clause included in the subcontract pursuant to paragraph (c) of this 
clause does not constitute a dispute to which the Government is a party. 
The Government may not be interpleaded in any judicial or administrative 
proceeding involving such a dispute.
    (j) Preservation of prime-subcontractor rights. Except as provided 
in paragraph (i) of this clause, this clause shall not limit or impair 
any contractual, administrative, or judicial remedies otherwise 
available to the Contractor or a subcontractor in the event of a

[[Page 252]]

dispute involving late payment or nonpayment by the Contractor or 
deficient subcontract performance or nonperformance by a subcontractor.
    (k) Non-recourse for prime contractor interest penalty. The 
Contractor's obligation to pay an interest penalty to a subcontractor 
pursuant to the clauses included in a subcontract under paragraph (c) of 
this clause shall not be construed to be an obligation of the Government 
for such interest penalty. A cost-reimbursement claim may not include 
any amount for reimbursement of such interest penalty.
    (l) Overpayments. If the Contractor becomes aware of a duplicate 
payment or that the Government has otherwise overpaid on an invoice 
payment, the Contractor shall immediately notify the Contracting Officer 
and request instructions for disposition of the overpayment.

                             (End of clause)

[66 FR 65361, Dec. 18, 2001]

    Effective Date Note: At 68 FR 56684, Oct. 1, 2003, Sec.  52.232-27 
was amended by revising the date of the clause and paragraph (1), 
effective Oct. 31, 2003. For the convenince of the user, the revised 
text is set forth below:

Sec.  52.232-27  Prompt Payment for Construction Contracts.

                                * * * * *

         Prompt Payment for Construction Contracts (Oct. 2003).

                                * * * * *

    (1) Overpayments. If the Contractor becomes aware of a duplicate 
contract financing or invoice payment or that the Government has 
otherwise overpaid on a contract financing or invoice payment, the 
Contractor shall immediately notify the Contracting Officer and request 
instructions for disposition of the overpayment.



Sec.  52.232-28  Invitation to Propose Performance-Based Payments.

    As prescribed in 32.1005(b)(1), insert the following provision:

       Invitation to Propose Performance-Based Payments (MAR 2000)

    (a) The Government invites the offeror to propose terms under which 
the Government will make performance-based contract financing payments 
during contract performance. The Government will consider performance-
based payment financing terms proposed by the offeror in the evaluation 
of the offeror's proposal. The Contracting Officer will incorporate the 
financing terms of the successful offeror and the FAR clause, 
Performance-Based Payments, at FAR 52.232-32, in any resulting contract.
    (b) In the event of any conflict between the terms proposed by the 
offeror and the terms in the clause at FAR 52.232-32, Performance-Based 
Payments, the terms of the clause at FAR 52.232-32 shall govern.
    (c) The Contracting Officer will not accept the offeror's proposed 
performance-based payment financing if the financing does not conform to 
the following limitations:
    (1) The Government will make delivery payments only for supplies 
delivered and accepted, or services rendered and accepted in accordance 
with the payment terms of this contract.
    (2) The terms and conditions of the performance-based payments 
must--
    (i) Comply with FAR 32.1004;
    (ii) Be reasonable and consistent with all other technical and cost 
information included in the offeror's proposal; and
    (iii) Their total shall not exceed 90 percent of the contract price 
if on a whole contract basis, or 90 percent of the delivery item price 
if on a delivery item basis.
    (3) The terms and conditions of the performance-based financing must 
be in the best interests of the Government.
    (d) The offeror's proposal of performance-based payment financing 
shall include the following:
    (1) The proposed contractual language describing the performance-
based payments (see FAR 32.1004 for appropriate criteria for 
establishing performance bases and performance-based finance payment 
amounts).
    (2) A listing of--
    (i) The projected performance-based payment dates and the projected 
payment amounts; and
    (ii) The projected delivery date and the projected payment amount.
    (3) Information addressing the Contractor's investment in the 
contract.
    (e) Evaluation of the offeror's proposed prices and financing terms 
will include whether the offeror's proposed performance-based payment 
events and payment amounts are reasonable and consistent with all other 
terms and conditions of the offeror's proposal.

                           (End of provision)

    Alternate I (Mar 2000). As prescribed in FAR 32.1005(b)(2), add the 
following paragraph (f) to the basic provision:

    (f) The Government will adjust each proposed price to reflect the 
cost of providing the proposed performance-based payments to determine 
the total cost to the Government of that particular combination of price 
and

[[Page 253]]

performance-based financing. The Government will make the adjustment 
using the procedure described in FAR 32.205(c).

[65 FR 16285, Mar. 27, 2000]



Sec.  52.232-29  Terms for Financing of Purchases of Commercial Items.

    As prescribed in 32.206(b)(2), insert the following clause:

     Terms for Financing of Purchases of Commercial Items (FEB 2002)

    (a) Contractor entitlement to financing payments. The Contractor may 
request, and the Government shall pay, a contract financing payment as 
specified elsewhere in this contract when: the payment requested is 
properly due in accordance with this contract; the supplies deliverable 
or services due under the contract will be delivered or performed in 
accordance with the contract; and there has been no impairment or 
diminution of the Government's security under this contract.
    (b) Special terms regarding termination for cause. If this contract 
is terminated for cause, the Contractor shall, on demand, repay to the 
Government the amount of unliquidated contract financing payments. The 
Government shall be liable for no payment except as provided by the 
Termination for Cause paragraph of the clause at 52.212-4, Contract 
Terms and Conditions--Commercial Items.
    (c) Security for Government financing. In the event the Contractor 
fails to provide adequate security, as required in this contract, no 
financing payment shall be made under this contract. Upon receipt of 
adequate security, financing payments shall be made, including all 
previous payments to which the Contractor is entitled, in accordance 
with the terms of the provisions for contract financing. If at any time 
the Contracting Officer determines that the security provided by the 
Contractor is insufficient, the Contractor shall promptly provide such 
additional security as the Contracting Officer determines necessary. In 
the event the Contractor fails to provide such additional security, the 
Contracting Officer may collect or liquidate such security that has been 
provided and suspend further payments to the Contractor; and the 
Contractor shall repay to the Government the amount of unliquidated 
financing payments as the Contracting Officer at his sole discretion 
deems repayable.
    (d) Reservation of rights. (1) No payment or other action by the 
Government under this clause shall (i) excuse the Contractor from 
performance of obligations under this contract, or (ii) constitute a 
waiver of any of the rights or remedies of the parties under the 
contract.
    (2) The Government's rights and remedies under this clause (i) shall 
not be exclusive, but rather shall be in addition to any other rights 
and remedies provided by law or this contract; and (ii) shall not be 
affected by delayed, partial, or omitted exercise of any right, remedy, 
power, or privilege, nor shall such exercise or any single exercise 
preclude or impair any further exercise under this clause or the 
exercise of any other right, power, or privilege of the Government.
    (e) Content of Contractor's request for financing payment. The 
Contractor's request for financing payment shall contain the following:
    (1) The name and address of the Contractor;
    (2) The date of the request for financing payment;
    (3) The contract number and/or other identifier of the contract or 
order under which the request is made; and
    (4) An appropriately itemized and totaled statement of the financing 
payments requested and such other information as is necessary for 
computation of the payment, prepared in accordance with the direction of 
the Contracting Officer.
    (f) Limitation on frequency of financing payments. Contractor 
financing payments shall be provided no more frequently than monthly.
    (g) Dates for payment. A payment under this clause is a contract 
financing payment and not subject to the interest penalty provisions of 
the Prompt Payment Act. The designated payment office will pay approved 
payment requests within 30 days of submittal of a proper request for 
payment.
    (h) Conflict between terms of offeror and clause. In the event of 
any conflict between the terms proposed by the offeror in response to an 
invitation to propose financing terms (52.232-31) and the terms in this 
clause, the terms of this clause shall govern.

                             (End of clause)

[60 FR 49717, Sept. 26, 1995, as amended at 66 FR 65367, Dec. 18, 2001]



Sec.  52.232-30  Installment Payments for Commercial Items.

    As prescribed in 32.206(g), insert the following clause:

          Installment Payments for Commercial Items (OCT 1995)

    (a) Contractor entitlement to financing payments. The Contractor may 
request, and the Government shall pay, a contract financing installment 
payment as specified in this contract when: the payment requested is 
properly due in accordance with this contract; the supplies deliverable 
or services due under the contract will be delivered or performed

[[Page 254]]

in accordance with the contract; and there has been no impairment or 
diminution of the Government's security under this contract.
    (b) Computation of amounts. Installment payment financing shall be 
paid to the Contractor when requested for each separately priced unit of 
supply (but not for services) of each contract line item in amounts 
approved by the Contracting Officer pursuant to this clause.
    (1) Number of installment payments for each contract line item. Each 
separately priced unit of each contract line item is authorized a fixed 
number of monthly installment payments. The number of installment 
payments authorized for each unit of a contract line item is equal to 
the number of months from the date of contract award to the date one 
month before the first delivery of the first separately priced unit of 
the contract line item. For example, if the first scheduled delivery of 
any separately priced unit of a contract line item is 9 months after 
award of the contract, all separately priced units of that contract line 
item are authorized 8 installment payments.
    (2) Amount of each installment payment. The amount of each 
installment payment for each separately priced unit of each contract 
line item is equal to 70 percent of the unit price divided by the number 
of installment payments authorized for that unit.
    (3) Date of each installment payment. Installment payments for any 
particular separately priced unit of a contract line item begin the 
number of months prior to the delivery of that unit that are equal to 
the number of installment payments authorized for that unit. For 
example, if 8 installment payments are authorized for each separately 
priced unit of a contract line item, the first installment payment for 
any particular unit of that contract line item would be 8 months before 
the scheduled delivery date for that unit. The last installment payment 
would be 1 month before scheduled delivery of a unit.
    (4) Limitation on payment. Prior to the delivery payment for a 
separately priced unit of a contract line item, the sum of all 
installment payments for that unit shall not exceed 70 percent of the 
price of that unit.
    (c) Contractor request for installment payment. The Contractor may 
submit requests for payment of installment payments not more frequently 
than monthly, in a form and manner acceptable to the Contracting 
Officer. Unless otherwise authorized by the Contracting Officer, all 
installment payments in any month for which payment is being requested 
shall be included in a single request, appropriately itemized and 
totaled.
    (d) Dates for payment. An installment payment under this clause is a 
contract financing payment under the Prompt Payment clause of this 
contract, and except as provided in paragraph (e) of this clause, 
approved requests shall be paid within 30 days of submittal of a proper 
request for payment.
    (e) Liquidation of installment payments. Installment payments shall 
be liquidated by deducting from the delivery payment of each item the 
total unliquidated amount of installment payments made for that 
separately priced unit of that contract line item. The liquidation 
amounts for each unit of each line item shall be clearly delineated in 
each request for delivery payment submitted by the Contractor.
    (f) Security for installment payment financing. In the event the 
Contractor fails to provide adequate security as required in this 
contract, no financing payment shall be made under this contract. Upon 
receipt of adequate security, financing payments shall be made, 
including all previous payments to which the Contractor is entitled, in 
accordance with the terms of the contract. If at any time the 
Contracting Officer determines that the security provided by the 
Contractor is insufficient, the Contractor shall promptly provide such 
additional security as the Contracting Officer determines necessary. In 
the event the Contractor fails to provide such additional security, the 
Contracting Officer may collect or liquidate such security that has been 
provided, and suspend further payments to the Contractor; the Contractor 
shall repay to the Government the amount of unliquidated financing 
payments as the Contracting Officer at his sole discretion deems 
repayable.
    (g) Special terms regarding termination for cause. If this contract 
is terminated for cause, the Contractor shall, on demand, repay to the 
Government the amount of unliquidated installment payments. The 
Government shall be liable for no payment except as provided by the 
Termination for Cause paragraph of the clause at 52.212-4, Contract 
Terms and Conditions--Commercial Items.
    (h) Reservation of rights. (1) No payment, vesting of title under 
this clause, or other action taken by the Government under this clause 
shall (i) excuse the Contractor from performance of obligations under 
this contract, or (ii) constitute a waiver of any of the rights or 
remedies of the parties under the contract.
    (2) The Government's rights and remedies under this clause (i) shall 
not be exclusive, but rather shall be in addition to any other rights 
and remedies provided by law or this contract, and (ii) shall not be 
affected by delayed, partial, or omitted exercise of any right, remedy, 
power, or privilege, nor shall such exercise or any single exercise 
preclude or impair any further exercise under this clause or the 
exercise of any other right, power, or privilege of the Government.
    (i) Content of Contractor's request for installment payment. The 
Contractor's request for

[[Page 255]]

installment payment shall contain the following:
    (1) The name and address of the Contractor;
    (2) The date of the request for installment payment;
    (3) The contract number and/or other identifier of the contract or 
order under which the request is made; and
    (4) An itemized and totaled statement of the items, installment 
payment amount, and month for which payment is being requested, for each 
separately priced unit of each contract line item.

                             (End of clause)

[60 FR 49717, Sept. 26, 1995]



Sec.  52.232-31  Invitation to Propose Financing Terms.

    As prescribed in 32.205(b) and 32.206, insert the following 
provision:

            Invitation to Propose Financing Terms (OCT 1995)

    (a) The offeror is invited to propose terms under which the 
Government shall make contract financing payments during contract 
performance. The financing terms proposed by the offeror shall be a 
factor in the evaluation of the offeror's proposal. The financing terms 
of the successful offeror and the clause, Terms for Financing of 
Purchases of Commercial Items, at 52.232-29, shall be incorporated in 
any resulting contract.
    (b) The offeror agrees that in the event of any conflict between the 
terms proposed by the offeror and the terms in the clause at 52.232-29, 
Terms for Financing of Purchases of Commercial Items, the terms of the 
clause at 52.232-29 shall govern.
    (c) Because of statutory limitations (10 U.S.C. 2307(f) and 41 
U.S.C. 255(f)), the offeror's proposed financing shall not be acceptable 
if it does not conform to the following limitations:
    (1) Delivery payments shall be made only for supplies delivered and 
accepted, or services rendered and accepted in accordance with the 
payment terms of this contract;
    (2) Contract financing payments shall not exceed 15 percent of the 
contract price in advance of any performance of work under the contract;
    (3) The terms and conditions of the contract financing must be 
appropriate or customary in the commercial marketplace; and
    (4) The terms and conditions of the contract financing must be in 
the best interests of the United States.
    (d) The offeror's proposal of financing terms shall include the 
following:
    (1) The proposed contractual language describing the contract 
financing (see FAR 32.202-2 for appropriate definitions of types of 
payments); and
    (2) A listing of the earliest date and greatest amount at which each 
contract financing payment may be payable and the amount of each 
delivery payment. Any resulting contract shall provide that no contract 
financing payment shall be made at any earlier date or in a greater 
amount than shown in the offeror's listing.
    (e) The offeror's proposed prices and financing terms shall be 
evaluated to determine the cost to the United States of the proposal 
using the interest rate and delivery schedule specified elsewhere in 
this solicitation.

                           (End of provision)

[60 FR 49718, Sept. 26, 1995]



Sec.  52.232-32  Performance-Based Payments.

    As prescribed in 32.1005, insert the following clause:

                  Performance-Based Payments (FEB 2002)

    (a) Amount of payments and limitations on payments. Subject to such 
other limitations and conditions as are specified in this contract and 
this clause, the amount of payments and limitations on payments shall be 
specified in the contract's description of the basis for payment.
    (b) Contractor request for performance-based payment. The Contractor 
may submit requests for payment of performance-based payments not more 
frequently than monthly, in a form and manner acceptable to the 
Contracting Officer. Unless otherwise authorized by the Contracting 
Officer, all performance-based payments in any period for which payment 
is being requested shall be included in a single request, appropriately 
itemized and totaled. The Contractor's request shall contain the 
information and certification detailed in paragraphs (l) and (m) of this 
clause.
    (c) Approval and payment of requests. (1) The Contractor shall not 
be entitled to payment of a request for performance-based payment prior 
to successful accomplishment of the event or performance criterion for 
which payment is requested. The Contracting Officer shall determine 
whether the event or performance criterion for which payment is 
requested has been successfully accomplished in accordance with the 
terms of the contract. The Contracting Officer may, at any time, require 
the Contractor to substantiate the successful performance of any event 
or performance criterion which has been or is represented as being 
payable.
    (2) A payment under this performance-based payment clause is a 
contract financing payment under the Prompt Payment clause

[[Page 256]]

of this contract and not subject to the interest penalty provisions of 
the Prompt Payment Act. The designated payment office will pay approved 
requests on the -------- [Contracting Officer insert day as prescribed 
by agency head; if not prescribed, insert ``30th''] day after receipt of 
the request for performance-based payment. However, the designated 
payment office is not required to provide payment if the Contracting 
Officer requires substantiation as provided in paragraph (c)(1) of this 
clause, or inquires into the status of an event or performance 
criterion, or into any of the conditions listed in paragraph (e) of this 
clause, or into the Contractor certification. The payment period will 
not begin until the Contracting Officer approves the request.
    (3) The approval by the Contracting Officer of a request for 
performance-based payment does not constitute an acceptance by the 
Government and does not excuse the Contractor from performance of 
obligations under this contract.
    (d) Liquidation of performance-based payments. (1) Performance-based 
finance amounts paid prior to payment for delivery of an item shall be 
liquidated by deducting a percentage or a designated dollar amount from 
the delivery payment. If the performance-based finance payments are on a 
delivery item basis, the liquidation amount for each such line item 
shall be the percent of that delivery item price that was previously 
paid under performance-based finance payments or the designated dollar 
amount. If the performance-based finance payments are on a whole 
contract basis, liquidation shall be by either predesignated liquidation 
amounts or a liquidation percentage.
    (2) If at any time the amount of payments under this contract 
exceeds any limitation in this contract, the Contractor shall repay to 
the Government the excess. Unless otherwise determined by the 
Contracting Officer, such excess shall be credited as a reduction in the 
unliquidated performance-based payment balance(s), after adjustment of 
invoice payments and balances for any retroactive price adjustments.
    (e) Reduction or suspension of performance-based payments. The 
Contracting Officer may reduce or suspend performance-based payments, 
liquidate performance-based payments by deduction from any payment under 
the contract, or take a combination of these actions after finding upon 
substantial evidence any of the following conditions:
    (1) The Contractor failed to comply with any material requirement of 
this contract (which includes paragraphs (h) and (i) of this clause).
    (2) Performance of this contract is endangered by the Contractor's 
(i) failure to make progress, or (ii) unsatisfactory financial 
condition.
    (3) The Contractor is delinquent in payment of any subcontractor or 
supplier under this contract in the ordinary course of business.
    (f) Title. (1) Title to the property described in this paragraph (f) 
shall vest in the Government. Vestiture shall be immediately upon the 
date of the first performance-based payment under this contract, for 
property acquired or produced before that date. Otherwise, vestiture 
shall occur when the property is or should have been allocable or 
properly chargeable to this contract.
    (2) Property, as used in this clause, includes all of the following 
described items acquired or produced by the Contractor that are or 
should be allocable or properly chargeable to this contract under sound 
and generally accepted accounting principles and practices:
    (i) Parts, materials, inventories, and work in process;
    (ii) Special tooling and special test equipment to which the 
Government is to acquire title under any other clause of this contract;
    (iii) Nondurable (i.e., noncapital) tools, jigs, dies, fixtures, 
molds, patterns, taps, gauges, test equipment and other similar 
manufacturing aids, title to which would not be obtained as special 
tooling under subparagraph (f)(2)(ii) of this clause; and
    (iv) Drawings and technical data, to the extent the Contractor or 
subcontractors are required to deliver them to the Government by other 
clauses of this contract.
    (3) Although title to property is in the Government under this 
clause, other applicable clauses of this contract (e.g., the termination 
or special tooling clauses) shall determine the handling and disposition 
of the property.
    (4) The Contractor may sell any scrap resulting from production 
under this contract, without requesting the Contracting Officer's 
approval, provided that any significant reduction in the value of the 
property to which the Government has title under this clause is reported 
in writing to the Contracting Officer.
    (5) In order to acquire for its own use or dispose of property to 
which title is vested in the Government under this clause, the 
Contractor must obtain the Contracting Officer's advance approval of the 
action and the terms. If approved, the basis for payment (the events or 
performance criteria) to which the property is related shall be deemed 
to be not in compliance with the terms of the contract and not payable 
(if the property is part of or needed for performance), and the 
Contractor shall refund the related performance-based payments in 
accordance with paragraph (d) of this clause.
    (6) When the Contractor completes all of the obligations under this 
contract, including liquidation of all performance-based payments, title 
shall vest in the Contractor for all property (or the proceeds thereof) 
not--

[[Page 257]]

    (i) Delivered to, and accepted by, the Government under this 
contract; or
    (ii) Incorporated in supplies delivered to, and accepted by, the 
Government under this contract and to which title is vested in the 
Government under this clause.
    (7) The terms of this contract concerning liability for Government-
furnished property shall not apply to property to which the Government 
acquired title solely under this clause.
    (g) Risk of loss. Before delivery to and acceptance by the 
Government, the Contractor shall bear the risk of loss for property, the 
title to which vests in the Government under this clause, except to the 
extent the Government expressly assumes the risk. If any property is 
damaged, lost, stolen, or destroyed, the basis of payment (the events or 
performance criteria) to which the property is related shall be deemed 
to be not in compliance with the terms of the contract and not payable 
(if the property is part of or needed for performance), and the 
Contractor shall refund the related performance-based payments in 
accordance with paragraph (d) of this clause.
    (h) Records and controls. The Contractor shall maintain records and 
controls adequate for administration of this clause. The Contractor 
shall have no entitlement to performance-based payments during any time 
the Contractor's records or controls are determined by the Contracting 
Officer to be inadequate for administration of this clause.
    (i) Reports and Government access. The Contractor shall promptly 
furnish reports, certificates, financial statements, and other pertinent 
information requested by the Contracting Officer for the administration 
of this clause and to determine that an event or other criterion 
prompting a financing payment has been successfully accomplished. The 
Contractor shall give the Government reasonable opportunity to examine 
and verify the Contractor's records and to examine and verify the 
Contractor's performance of this contract for administration of this 
clause.
    (j) Special terms regarding default. If this contract is terminated 
under the Default clause, (1) the Contractor shall, on demand, repay to 
the Government the amount of unliquidated performance-based payments, 
and (2) title shall vest in the Contractor, on full liquidation of all 
performance-based payments, for all property for which the Government 
elects not to require delivery under the Default clause of this 
contract. The Government shall be liable for no payment except as 
provided by the Default clause.
    (k) Reservation of rights. (1) No payment or vesting of title under 
this clause shall (i) excuse the Contractor from performance of 
obligations under this contract, or (ii) constitute a waiver of any of 
the rights or remedies of the parties under the contract.
    (2) The Government's rights and remedies under this clause (i) shall 
not be exclusive, but rather shall be in addition to any other rights 
and remedies provided by law or this contract, and (ii) shall not be 
affected by delayed, partial, or omitted exercise of any right, remedy, 
power, or privilege, nor shall such exercise or any single exercise 
preclude or impair any further exercise under this clause or the 
exercise of any other right, power, or privilege of the Government.
    (l) Content of Contractor's request for performance-based payment. 
The Contractor's request for performance-based payment shall contain the 
following:
    (1) The name and address of the Contractor;
    (2) The date of the request for performance-based payment;
    (3) The contract number and/or other identifier of the contract or 
order under which the request is made;
    (4) Such information and documentation as is required by the 
contract's description of the basis for payment; and
    (5) A certification by a Contractor official authorized to bind the 
Contractor, as specified in paragraph (m) of this clause.
    (m) Content of Contractor's certification. As required in paragraph 
(l)(5) of this clause, the Contractor shall make the following 
certification in each request for performance-based payment:
    I certify to the best of my knowledge and belief that--
    (1) This request for performance-based payment is true and correct; 
this request (and attachments) has been prepared from the books and 
records of the Contractor, in accordance with the contract and the 
instructions of the Contracting Officer;
    (2) (Except as reported in writing on --------------), all payments 
to subcontractors and suppliers under this contract have been paid, or 
will be paid, currently, when due in the ordinary course of business;
    (3) There are no encumbrances (except as reported in writing on ----
----------) against the property acquired or produced for, and allocated 
or properly chargeable to, the contract which would affect or impair the 
Government's title;
    (4) There has been no materially adverse change in the financial 
condition of the Contractor since the submission by the Contractor to 
the Government of the most recent written information dated ------------
--; and
    (5) After the making of this requested performance-based payment, 
the amount of all payments for each deliverable item for which 
performance-based payments have been requested will not exceed any 
limitation in the contract, and the amount of all payments under the 
contract will not exceed any limitation in the contract.

[[Page 258]]

                             (End of clause)

[60 FR 49718, Sept. 26, 1995, as amended at 62 FR 12720, Mar. 17, 1997; 
66 FR 65367, Dec. 18, 2001]



Sec.  52.232-33  Payment by Electronic Funds Transfer--Central Contractor Registration.

    As prescribed in 32.1110(a)(1), insert the following clause:

 Payment by Electronic Funds Transfer--Central Contractor Registration 
                               (Oct 2003)

    (a) Method of payment. (1) All payments by the Government under this 
contract shall be made by electronic funds transfer (EFT), except as 
provided in paragraph (a)(2) of this clause. As used in this clause, the 
term ``EFT'' refers to the funds transfer and may also include the 
payment information transfer.
    (2) In the event the Government is unable to release one or more 
payments by EFT, the Contractor agrees to either--
    (i) Accept payment by check or some other mutually agreeable method 
of payment; or
    (ii) Request the Government to extend the payment due date until 
such time as the Government can make payment by EFT (but see paragraph 
(d) of this clause).
    (b) Contractor's EFT information. The Government shall make payment 
to the Contractor using the EFT information contained in the Central 
Contractor Registration (CCR) database. In the event that the EFT 
information changes, the Contractor shall be responsible for providing 
the updated information to the CCR database.
    (c) Mechanisms for EFT payment. The Government may make payment by 
EFT through either the Automated Clearing House (ACH) network, subject 
to the rules of the National Automated Clearing House Association, or 
the Fedwire Transfer System. The rules governing Federal payments 
through the ACH are contained in 31 CFR part 210.
    (d) Suspension of payment. If the Contractor's EFT information in 
the CCR database is incorrect, then the Government need not make payment 
to the Contractor under this contract until correct EFT information is 
entered into the CCR database; and any invoice or contract financing 
request shall be deemed not to be a proper invoice for the purpose of 
prompt payment under this contract. The prompt payment terms of the 
contract regarding notice of an improper invoice and delays in accrual 
of interest penalties apply.
    (e) Liability for uncompleted or erroneous transfers. (1) If an 
uncompleted or erroneous transfer occurs because the Government used the 
Contractor's EFT information incorrectly, the Government remains 
responsible for--
    (i) Making a correct payment;
    (ii) Paying any prompt payment penalty due; and
    (iii) Recovering any erroneously directed funds.
    (2) If an uncompleted or erroneous transfer occurs because the 
Contractor's EFT information was incorrect, or was revised within 30 
days of Government release of the EFT payment transaction instruction to 
the Federal Reserve System, and--
    (i) If the funds are no longer under the control of the payment 
office, the Government is deemed to have made payment and the Contractor 
is responsible for recovery of any erroneously directed funds; or
    (ii) If the funds remain under the control of the payment office, 
the Government shall not make payment, and the provisions of paragraph 
(d) of this clause shall apply.
    (f) EFT and prompt payment. A payment shall be deemed to have been 
made in a timely manner in accordance with the prompt payment terms of 
this contract if, in the EFT payment transaction instruction released to 
the Federal Reserve System, the date specified for settlement of the 
payment is on or before the prompt payment due date, provided the 
specified payment date is a valid date under the rules of the Federal 
Reserve System.
    (g) EFT and assignment of claims. If the Contractor assigns the 
proceeds of this contract as provided for in the assignment of claims 
terms of this contract, the Contractor shall require as a condition of 
any such assignment, that the assignee shall register separately in the 
CCR database and shall be paid by EFT in accordance with the terms of 
this clause. Notwithstanding any other requirement of this contract, 
payment to an ultimate recipient other than the Contractor, or a 
financial institution properly recognized under an assignment of claims 
pursuant to subpart 32.8, is not permitted. In all respects, the 
requirements of this clause shall apply to the assignee as if it were 
the Contractor. EFT information that shows the ultimate recipient of the 
transfer to be other than the Contractor, in the absence of a proper 
assignment of claims acceptable to the Government, is incorrect EFT 
information within the meaning of paragraph (d) of this clause.
    (h) Liability for change of EFT information by financial agent. The 
Government is not liable for errors resulting from changes to EFT 
information made by the Contractor's financial agent.
    (i) Payment information. The payment or disbursing office shall 
forward to the Contractor available payment information that is suitable 
for transmission as of the date of release of the EFT instruction to the 
Federal

[[Page 259]]

Reserve System. The Government may request the Contractor to designate a 
desired format and method(s) for delivery of payment information from a 
list of formats and methods the payment office is capable of executing. 
However, the Government does not guarantee that any particular format or 
method of delivery is available at any particular payment office and 
retains the latitude to use the format and delivery method most 
convenient to the Government. If the Government makes payment by check 
in accordance with paragraph (a) of this clause, the Government shall 
mail the payment information to the remittance address contained in the 
CCR database.

                             (End of Clause)

[64 FR 10542, Mar. 4, 1999, as amended at 68 FR 56675, Oct. 1, 2003]



Sec.  52.232-34  Payment by Electronic Funds Transfer--Other than Central 
Contractor Registration.

    As prescribed in 32.1110(a)(2), insert the following clause:

  Payment by Electronic Funds Transfer--Other Than Central Contractor 
                         Registration (MAY 1999)

    (a) Method of payment. (1) All payments by the Government under this 
contract shall be made by electronic funds transfer (EFT) except as 
provided in paragraph (a)(2) of this clause. As used in this clause, the 
term ``EFT'' refers to the funds transfer and may also include the 
payment information transfer.
    (2) In the event the Government is unable to release one or more 
payments by EFT, the Contractor agrees to either--
    (i) Accept payment by check or some other mutually agreeable method 
of payment; or
    (ii) Request the Government to extend payment due dates until such 
time as the Government makes payment by EFT (but see paragraph (d) of 
this clause).
    (b) Mandatory submission of Contractor's EFT information. (1) The 
Contractor is required to provide the Government with the information 
required to make payment by EFT (see paragraph (j) of this clause). The 
Contractor shall provide this information directly to the office 
designated in this contract to receive that information (hereafter: 
``designated office'') by ------------------ [the Contracting Officer 
shall insert date, days after award, days before first request, the date 
specified for receipt of offers if the provision at 52.232-38 is 
utilized, or ``concurrent with first request'' as prescribed by the head 
of the agency; if not prescribed, insert ``no later than 15 days prior 
to submission of the first request for payment'']. If not otherwise 
specified in this contract, the payment office is the designated office 
for receipt of the Contractor's EFT information. If more than one 
designated office is named for the contract, the Contractor shall 
provide a separate notice to each office. In the event that the EFT 
information changes, the Contractor shall be responsible for providing 
the updated information to the designated office(s).
    (2) If the Contractor provides EFT information applicable to 
multiple contracts, the Contractor shall specifically state the 
applicability of this EFT information in terms acceptable to the 
designated office. However, EFT information supplied to a designated 
office shall be applicable only to contracts that identify that 
designated office as the office to receive EFT information for that 
contract.
    (c) Mechanisms for EFT payment. The Government may make payment by 
EFT through either the Automated Clearing House (ACH) network, subject 
to the rules of the National Automated Clearing House Association, or 
the Fedwire Transfer System. The rules governing Federal payments 
through the ACH are contained in 31 CFR part 210.
    (d) Suspension of payment. (1) The Government is not required to 
make any payment under this contract until after receipt, by the 
designated office, of the correct EFT payment information from the 
Contractor. Until receipt of the correct EFT information, any invoice or 
contract financing request shall be deemed not to be a proper invoice 
for the purpose of prompt payment under this contract. The prompt 
payment terms of the contract regarding notice of an improper invoice 
and delays in accrual of interest penalties apply.
    (2) If the EFT information changes after submission of correct EFT 
information, the Government shall begin using the changed EFT 
information no later than 30 days after its receipt by the designated 
office to the extent payment is made by EFT. However, the Contractor may 
request that no further payments be made until the updated EFT 
information is implemented by the payment office. If such suspension 
would result in a late payment under the prompt payment terms of this 
contract, the Contractor's request for suspension shall extend the due 
date for payment by the number of days of the suspension.
    (e) Liability for uncompleted or erroneous transfers. (1) If an 
uncompleted or erroneous transfer occurs because the Government used the 
Contractor's EFT information incorrectly, the Government remains 
responsible for--
    (i) Making a correct payment;
    (ii) Paying any prompt payment penalty due; and
    (iii) Recovering any erroneously directed funds.

[[Page 260]]

    (2) If an uncompleted or erroneous transfer occurs because the 
Contractor's EFT information was incorrect, or was revised within 30 
days of Government release of the EFT payment transaction instruction to 
the Federal Reserve System, and--
    (i) If the funds are no longer under the control of the payment 
office, the Government is deemed to have made payment and the Contractor 
is responsible for recovery of any erroneously directed funds; or
    (ii) If the funds remain under the control of the payment office, 
the Government shall not make payment and the provisions of paragraph 
(d) shall apply.
    (f) EFT and prompt payment. A payment shall be deemed to have been 
made in a timely manner in accordance with the prompt payment terms of 
this contract if, in the EFT payment transaction instruction released to 
the Federal Reserve System, the date specified for settlement of the 
payment is on or before the prompt payment due date, provided the 
specified payment date is a valid date under the rules of the Federal 
Reserve System.
    (g) EFT and assignment of claims. If the Contractor assigns the 
proceeds of this contract as provided for in the assignment of claims 
terms of this contract, the Contractor shall require as a condition of 
any such assignment, that the assignee shall provide the EFT information 
required by paragraph (j) of this clause to the designated office, and 
shall be paid by EFT in accordance with the terms of this clause. In all 
respects, the requirements of this clause shall apply to the assignee as 
if it were the Contractor. EFT information that shows the ultimate 
recipient of the transfer to be other than the Contractor, in the 
absence of a proper assignment of claims acceptable to the Government, 
is incorrect EFT information within the meaning of paragraph (d) of this 
clause.
    (h) Liability for change of EFT information by financial agent. The 
Government is not liable for errors resulting from changes to EFT 
information provided by the Contractor's financial agent.
    (i) Payment information. The payment or disbursing office shall 
forward to the Contractor available payment information that is suitable 
for transmission as of the date of release of the EFT instruction to the 
Federal Reserve System. The Government may request the Contractor to 
designate a desired format and method(s) for delivery of payment 
information from a list of formats and methods the payment office is 
capable of executing. However, the Government does not guarantee that 
any particular format or method of delivery is available at any 
particular payment office and retains the latitude to use the format and 
delivery method most convenient to the Government. If the Government 
makes payment by check in accordance with paragraph (a) of this clause, 
the Government shall mail the payment information to the remittance 
address in the contract.
    (j) EFT information. The Contractor shall provide the following 
information to the designated office. The Contractor may supply this 
data for this or multiple contracts (see paragraph (b) of this clause). 
The Contractor shall designate a single financial agent per contract 
capable of receiving and processing the EFT information using the EFT 
methods described in paragraph (c) of this clause.
    (1) The contract number (or other procurement identification 
number).
    (2) The Contractor's name and remittance address, as stated in the 
contract(s).
    (3) The signature (manual or electronic, as appropriate), title, and 
telephone number of the Contractor official authorized to provide this 
information.
    (4) The name, address, and 9-digit Routing Transit Number of the 
Contractor's financial agent.
    (5) The Contractor's account number and the type of account 
(checking, saving, or lockbox).
    (6) If applicable, the Fedwire Transfer System telegraphic 
abbreviation of the Contractor's financial agent.
    (7) If applicable, the Contractor shall also provide the name, 
address, telegraphic abbreviation, and 9-digit Routing Transit Number of 
the correspondent financial institution receiving the wire transfer 
payment if the Contractor's financial agent is not directly on-line to 
the Fedwire Transfer System; and, therefore, not the receiver of the 
wire transfer payment.

                             (End of clause)

[64 FR 10543, Mar. 4, 1999]



Sec.  52.232-35  Designation of Office for Government Receipt of Electronic 
Funds Transfer Information.

    As prescribed in 32.1110(c), insert the following clause:

    Designation of Office for Government Receipt of Electronic Funds 
                     Transfer Information (MAY 1999)

    (a) As provided in paragraph (b) of the clause at 52.232-34, Payment 
by Electronic Funds Transfer--Other than Central Contractor 
Registration, the Government has designated the office cited in 
paragraph (c) of this clause as the office to receive the Contractor's 
electronic funds transfer (EFT) information, in lieu of the payment 
office of this contract.
    (b) The Contractor shall send all EFT information, and any changes 
to EFT information to the office designated in paragraph (c) of this 
clause. The Contractor shall not send EFT information to the payment 
office, or

[[Page 261]]

any other office than that designated in paragraph (c). The Government 
need not use any EFT information sent to any office other than that 
designated in paragraph (c).
    (c) Designated Office:
Name:
________________________________________________________________________
________________________________________________________________________
Mailing Address:
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
Telephone Number:
________________________________________________________________________
Person to Contact:
________________________________________________________________________
Electronic Address:
________________________________________________________________________

                             (End of clause)

[64 FR 10544, Mar. 4, 1999]



Sec.  52.232-36  Payment by Third Party.

    As prescribed in 32.1110(d), insert the following clause:

                    Payment by Third Party (MAY 1999)

    (a) General. The Contractor agrees to accept payments due under this 
contract, through payment by a third party in lieu of payment directly 
from the Government, in accordance with the terms of this clause. The 
third party and, if applicable, the particular Governmentwide commercial 
purchase card to be used are identified elsewhere in this contract.
    (b) Contractor payment request. In accordance with those clauses of 
this contract that authorize the Contractor to submit invoices, contract 
financing requests, other payment requests, or as provided in other 
clauses providing for payment to the Contractor, the Contractor shall 
make such payment requests through a charge to the Government account 
with the third party, at the time and for the amount due in accordance 
with the terms of this contract.
    (c) Payment. The Contractor and the third party shall agree that 
payments due under this contract shall be made upon submittal of payment 
requests to the third party in accordance with the terms and conditions 
of an agreement between the Contractor, the Contractor's financial agent 
(if any), and the third party and its agents (if any). No payment shall 
be due the Contractor until such agreement is made. Payments made or due 
by the third party under this clause are not payments made by the 
Government and are not subject to the Prompt Payment Act or any 
implementation thereof in this contract.
    (d) Documentation. Documentation of each charge against the 
Government's account shall be provided to the Contracting Officer upon 
request.
    (e) Assignment of claims. Notwithstanding any other provision of 
this contract, if any payment is made under this clause, then no payment 
under this contract shall be assigned under the provisions of the 
assignment of claims terms of this contract or the Assignment of Claims 
Act of 1940, as amended, 31 U.S.C. 3727, 41 U.S.C. 15.
    (f) Other payment terms. The other payment terms of this contract 
shall govern the content and submission of payment requests. If any 
clause requires information or documents in or with the payment request, 
that is not provided in the third party agreement referenced in 
paragraph (c) of this clause, the Contractor shall obtain instructions 
from the Contracting Officer before submitting such a payment request.

                             (End of clause)

[64 FR 10544, Mar. 4, 1999]



Sec.  52.232-37  Multiple Payment Arrangements.

    As prescribed in 32.1110(e), insert the following clause:

                Multiple Payment Arrangements (MAY 1999)

    This contract or agreement provides for payments to the Contractor 
through several alternative methods. The applicability of specific 
methods of payment and the designation of the payment office(s) are 
either stated--
    (a) Elsewhere in this contract or agreement; or
    (b) In individual orders placed under this contract or agreement.

                             (End of clause)

[64 FR 10544, Mar. 4, 1999]



Sec.  52.232-38  Submission of Electronic Funds Transfer Information with Offer.

    As prescribed in 32.1110(g), insert the following provision:

  Submission of Electronic Funds Transfer Information With Offer (MAY 
                                  1999)

    The offeror shall provide, with its offer, the following information 
that is required to make payment by electronic funds transfer (EFT) 
under any contract that results from this solicitation. This submission 
satisfies the requirement to provide EFT information under paragraphs 
(b)(1) and (j) of the clause at 52.232-34, Payment by Electronic Funds 
Transfer--Other than Central Contractor Registration.
    (1) The solicitation number (or other procurement identification 
number).

[[Page 262]]

    (2) The offeror's name and remittance address, as stated in the 
offer.
    (3) The signature (manual or electronic, as appropriate), title, and 
telephone number of the offeror's official authorized to provide this 
information.
    (4) The name, address, and 9-digit Routing Transit Number of the 
offeror's financial agent.
    (5) The offeror's account number and the type of account (checking, 
savings, or lockbox).
    (6) If applicable, the Fedwire Transfer System telegraphic 
abbreviation of the offeror's financial agent.
    (7) If applicable, the offeror shall also provide the name, address, 
telegraphic abbreviation, and 9-digit Routing Transit Number of the 
correspondent financial institution receiving the wire transfer payment 
if the offeror's financial agent is not directly on-line to the Fedwire 
and, therefore, not the receiver of the wire transfer payment.

                           (End of provision)

[64 FR 10544, Mar. 4, 1999]



Sec.  52.233-1  Disputes.

    As prescribed in 33.215, insert the following clause:

                           Disputes (JUL 2002)

    (a) This contract is subject to the Contract Disputes Act of 1978, 
as amended (41 U.S.C. 601-613).
    (b) Except as provided in the Act, all disputes arising under or 
relating to this contract shall be resolved under this clause.
    (c) Claim, as used in this clause, means a written demand or written 
assertion by one of the contracting parties seeking, as a matter of 
right, the payment of money in a sum certain, the adjustment or 
interpretation of contract terms, or other relief arising under or 
relating to this contract. However, a written demand or written 
assertion by the Contractor seeking the payment of money exceeding 
$100,000 is not a claim under the Act until certified. A voucher, 
invoice, or other routine request for payment that is not in dispute 
when submitted is not a claim under the Act. The submission may be 
converted to a claim under the Act, by complying with the submission and 
certification requirements of this clause, if it is disputed either as 
to liability or amount or is not acted upon in a reasonable time.
    (d)(1) A claim by the Contractor shall be made in writing and, 
unless otherwise stated in this contract, submitted within 6 years after 
accrual of the claim to the Contracting Officer for a written decision. 
A claim by the Government against the Contractor shall be subject to a 
written decision by the Contracting Officer.
    (d)(2)(i) The Contractor shall provide the certification specified 
in paragraph (d)(2)(iii) of this clause when submitting any claim 
exceeding $100,000.
    (ii) The certification requirement does not apply to issues in 
controversy that have not been submitted as all or part of a claim.
    (iii) The certification shall state as follows: ``I certify that the 
claim is made in good faith; that the supporting data are accurate and 
complete to the best of my knowledge and belief; that the amount 
requested accurately reflects the contract adjustment for which the 
Contractor believes the Government is liable; and that I am duly 
authorized to certify the claim on behalf of the Contractor.''
    (3) The certification may be executed by any person duly authorized 
to bind the Contractor with respect to the claim.
    (e) For Contractor claims of $100,000 or less, the Contracting 
Officer must, if requested in writing by the Contractor, render a 
decision within 60 days of the request. For Contractor-certified claims 
over $100,000, the Contracting Officer must, within 60 days, decide the 
claim or notify the Contractor of the date by which the decision will be 
made.
    (f) The Contracting Officer's decision shall be final unless the 
Contractor appeals or files a suit as provided in the Act.
    (g) If the claim by the Contractor is submitted to the Contracting 
Officer or a claim by the Government is presented to the Contractor, the 
parties, by mutual consent, may agree to use alternative dispute 
resolution (ADR). If the Contractor refuses an offer for ADR, the 
Contractor shall inform the Contracting Officer, in writing, of the 
Contractor's specific reasons for rejecting the offer.
    (h) The Government shall pay interest on the amount found due and 
unpaid from (1) the date that the Contracting Officer receives the claim 
(certified, if required); or (2) the date that payment otherwise would 
be due, if that date is later, until the date of payment. With regard to 
claims having defective certifications, as defined in (FAR) 48 CFR 
33.201, interest shall be paid from the date that the Contracting 
Officer initially receives the claim. Simple interest on claims shall be 
paid at the rate, fixed by the Secretary of the Treasury as provided in 
the Act, which is applicable to the period during which the Contracting 
Officer receives the claim and then at the rate applicable for each 6-
month period as fixed by the Treasury Secretary during the pendency of 
the claim.
    (i) The Contractor shall proceed diligently with performance of this 
contract, pending final resolution of any request for relief, claim, 
appeal, or action arising under the contract, and comply with any 
decision of the Contracting Officer.

[[Page 263]]

                             (End of clause)

    Alternate I (Dec 1991). As prescribed in 33.215, substitute the 
following paragraph (i) for paragraph (i) of the basic clause:

    (i) The Contractor shall proceed diligently with performance of this 
contract, pending final resolution of any request for relief, claim, 
appeal, or action arising under or relating to the contract, and comply 
with any decision of the Contracting Officer.

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 26904, June 28, 1985; 
51 FR 36972, Oct. 16, 1986; 56 FR 67417, Dec. 30, 1991; 59 FR 11382, 
Mar. 10, 1994; 60 FR 48230, Sept. 18, 1995; 63 FR 58595, Oct. 30, 1998; 
67 FR 43514, June 27, 2002; 67 FR 47635, July 19, 2002]



Sec.  52.233-2  Service of Protest.

    As prescribed in 33.106(a), insert the following provision:

                      Service of Protest (AUG 1996)

    (a) Protests, as defined in section 33.101 of the Federal 
Acquisition Regulation, that are filed directly with an agency, and 
copies of any protests that are filed with the General Accounting Office 
(GAO), shall be served on the Contracting Officer (addressed as follows) 
by obtaining written and dated acknowledgment of receipt from ------. 
[Contracting Officer designate the official or location where a protest 
may be served on the Contracting Officer.]
    (b) The copy of any protest shall be received in the office 
designated above within one day of filing a protest with the GAO.

                           (End of provision)

[61 FR 41471, Aug. 8, 1996]



Sec.  52.233-3  Protest After Award.

    As prescribed in 33.106(b), insert the following clause:

                     Protest After Award (AUG 1996)

    (a) Upon receipt of a notice of protest (as defined in FAR 33.101) 
or a determination that a protest is likely (see FAR 33.102(d)), the 
Contracting Officer may, by written order to the Contractor, direct the 
Contractor to stop performance of the work called for by this contract. 
The order shall be specifically identified as a stop-work order issued 
under this clause. Upon receipt of the order, the Contractor shall 
immediately comply with its terms and take all reasonable steps to 
minimize the incurrence of costs allocable to the work covered by the 
order during the period of work stoppage. Upon receipt of the final 
decision in the protest, the Contracting Officer shall either--
    (1) Cancel the stop-work order; or
    (2) Terminate the work covered by the order as provided in the 
Default, or the Termination for Convenience of the Government, clause of 
this contract.
    (b) If a stop-work order issued under this clause is canceled either 
before or after a final decision in the protest, the Contractor shall 
resume work. The Contracting Officer shall make an equitable adjustment 
in the delivery schedule or contract price, or both, and the contract 
shall be modified, in writing, accordingly, if--
    (1) The stop-work order results in an increase in the time required 
for, or in the Contractor's cost properly allocable to, the performance 
of any part of this contract; and
    (2) The Contractor asserts its right to an adjustment within 30 days 
after the end of the period of work stoppage; provided, that if the 
Contracting Officer decides the facts justify the action, the 
Contracting Officer may receive and act upon a proposal submitted at any 
time before final payment under this contract.
    (c) If a stop-work order is not canceled and the work covered by the 
order is terminated for the convenience of the Government, the 
Contracting Officer shall allow reasonable costs resulting from the 
stop-work order in arriving at the termination settlement.
    (d) If a stop-work order is not canceled and the work covered by the 
order is terminated for default, the Contracting Officer shall allow, by 
equitable adjustment or otherwise, reasonable costs resulting from the 
stop-work order.
    (e) The Government's rights to terminate this contract at any time 
are not affected by action taken under this clause.
    (f) If, as the result of the Contractor's intentional or negligent 
misstatement, misrepresentation, or miscertification, a protest related 
to this contract is sustained, and the Government pays costs, as 
provided in FAR 33.102(b)(2) or 33.104(h)(1), the Government may require 
the Contractor to reimburse the Government the amount of such costs. In 
addition to any other remedy available, and pursuant to the requirements 
of subpart 32.6, the Government may collect this debt by offsetting the 
amount against any payment due the Contractor under any contract between 
the Contractor and the Government.

                             (End of clause)

    Alternate I (JUN 1985). As prescribed in 33.106(b), substitute in 
paragraph (a)(2) the words ``the Termination clause of this contract'' 
for the words ``the Default, or the Termination for Convenience of the 
Government clause

[[Page 264]]

of this contract.'' In paragraph (b) substitute the words ``an equitable 
adjustment in the delivery schedule, the estimated cost, the fee, or a 
combination thereof, and in any other terms of the contract that may be 
affected'' for the words ``an equitable adjustment in the delivery 
schedule or contract price, or both.''

[50 FR 25681, June 20, 1985, as amended at 54 FR 29284, July 11, 1989; 
60 FR 48231, 48276, Sept. 18, 1995; 61 FR 41472, Aug. 8, 1996]



Sec.  52.234-1  Industrial Resources Developed Under Defense Production Act 
Title III.

    As prescribed at 34.104, insert the following clause:

 Industrial Resources Developed Under Defense Production Act Title III 
                               (DEC 1994)

    (a) Definitions.
    Title III industrial resource means materials, services, processes, 
or manufacturing equipment (including the processes, technologies, and 
ancillary services for the use of such equipment) established or 
maintained under the authority of Title III, Defense Production Act (50 
U.S.C. App. 2091-2093).
    Title III project contractor means a Contractor that has received 
assistance for the development or manufacture of an industrial resource 
under 50 U.S.C. App. 2091-2093, Defense Production Act.
    (b) The Contractor shall refer any request from a Title III project 
contractor for testing and qualification of a Title III industrial 
resource to the Contracting Officer.
    (c) Upon the direction of the Contracting Officer, the Contractor 
shall test Title III industrial resources for qualification. The 
Contractor shall provide the test results to the Defense Production Act 
Office, Title III Program, located at Wright Patterson Air Force Base, 
Ohio 45433-7739.
    (d) When the Contracting Officer modifies the contract to direct 
testing pursuant to this clause, the Government will provide the Title 
III industrial resource to be tested and will make an equitable 
adjustment in the contract for the costs of testing and qualification of 
the Title III industrial resource.
    (e) The Contractor agrees to insert the substance of this clause, 
including paragraph (e), in every subcontract issued in performance of 
this contract.

                             (End of clause)

[59 FR 67048, Dec. 28, 1994; 60 FR 5870, Jan. 31, 1995]



Sec.  52.235  [Reserved]



Sec.  52.236-1  Performance of Work by the Contractor.

    As prescribed in 36.501(b), insert the following clause in 
solicitations and contracts when a fixed-price construction contract is 
contemplated and the contract amount is expected to exceed $1,000,000. 
The contracting officer may insert the clause in solicitations and 
contracts when a fixed-price construction contract is contemplated and 
the contract amount is expected to be $1,000,000 or less. Complete the 
clause by inserting the appropriate percentage consistent with the 
complexity and magnitude of the work and customary or necessary 
specialty subcontracting (see 36.501(a)).

            Performance of Work by the Contractor (APR 1984)

    The Contractor shall perform on the site, and with its own 
organization, work equivalent to at least ------ [insert the appropriate 
number in words followed by numerals in parentheses] percent of the 
total amount of work to be performed under the contract. This percentage 
may be reduced by a supplemental agreement to this contract if, during 
performing the work, the Contractor requests a reduction and the 
Contracting Officer determines that the reduction would be to the 
advantage of the Government.

                             (End of clause)



Sec.  52.236-2  Differing Site Conditions.

    As prescribed in 36.502, insert the following clause:

                  Differing Site Conditions (APR 1984)

    (a) The Contractor shall promptly, and before the conditions are 
disturbed, give a written notice to the Contracting Officer of (1) 
subsurface or latent physical conditions at the site which differ 
materially from those indicated in this contract, or (2) unknown 
physical conditions at the site, of an unusual nature, which differ 
materially from those ordinarily encountered and generally recognized as 
inhering in work of the character provided for in the contract.
    (b) The Contracting Officer shall investigate the site conditions 
promptly after receiving the notice. If the conditions do materially so 
differ and cause an increase or decrease in the Contractor's cost of, or 
the time required for, performing any part of the work under this 
contract, whether or not changed as a result of the conditions, an 
equitable adjustment shall be made under this

[[Page 265]]

clause and the contract modified in writing accordingly.
    (c) No request by the Contractor for an equitable adjustment to the 
contract under this clause shall be allowed, unless the Contractor has 
given the written notice required; provided, that the time prescribed in 
(a) above for giving written notice may be extended by the Contracting 
Officer.
    (d) No request by the Contractor for an equitable adjustment to the 
contract for differing site conditions shall be allowed if made after 
final payment under this contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34761, July 3, 1995]



Sec.  52.236-3  Site Investigation and Conditions Affecting the Work.

    As prescribed in 36.503, insert the following clause:

     Site Investigation and Conditions Affecting the Work (APR 1984)

    (a) The Contractor acknowledges that it has taken steps reasonably 
necessary to ascertain the nature and location of the work, and that it 
has investigated and satisfied itself as to the general and local 
conditions which can affect the work or its cost, including but not 
limited to (1) conditions bearing upon transportation, disposal, 
handling, and storage of materials; (2) the availability of labor, 
water, electric power, and roads; (3) uncertainties of weather, river 
stages, tides, or similar physical conditions at the site; (4) the 
conformation and conditions of the ground; and (5) the character of 
equipment and facilities needed preliminary to and during work 
performance. The Contractor also acknowledges that it has satisfied 
itself as to the character, quality, and quantity of surface and 
subsurface materials or obstacles to be encountered insofar as this 
information is reasonably ascertainable from an inspection of the site, 
including all exploratory work done by the Government, as well as from 
the drawings and specifications made a part of this contract. Any 
failure of the Contractor to take the actions described and acknowledged 
in this paragraph will not relieve the Contractor from responsibility 
for estimating properly the difficulty and cost of successfully 
performing the work, or for proceeding to successfully perform the work 
without additional expense to the Government.
    (b) The Government assumes no responsibility for any conclusions or 
interpretations made by the Contractor based on the information made 
available by the Government. Nor does the Government assume 
responsibility for any understanding reached or representation made 
concerning conditions which can affect the work by any of its officers 
or agents before the execution of this contract, unless that 
understanding or representation is expressly stated in this contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34761, July 3, 1995]



Sec.  52.236-4  Physical Data.

    As prescribed in 36.504, insert the following clause in 
solicitations and contracts when a fixed-price construction contract is 
contemplated and physical data (e.g., test borings, hydrographic, 
weather conditions data) will be furnished or made available to 
offerors. All information to be furnished or made available to offerors 
before award that pertains to the performance of the work should be 
identified in the clause. When subparagraphs are not applicable they may 
be deleted.

                        Physical Data (APR 1984)

    Data and information furnished or referred to below is for the 
Contractor's information. The Government shall not be responsible for 
any interpretation of or conclusion drawn from the data or information 
by the Contractor.
    (a) The indications of physical conditions on the drawings and in 
the specifications are the result of site investigations by ------ 
[insert a description of investigational methods used, such as surveys, 
auger borings, core borings, test pits, probings, test tunnels].
    (b) Weather conditions ------ [insert a summary of weather records 
and warnings].
    (c) Transportation facilities ------ [insert a summary of 
transportation facilities providing access from the site, including 
information about their availability and limitations].
    (d) ------ [Insert other pertinent information].

                             (End of clause)



Sec.  52.236-5  Material and Workmanship.

    As prescribed in 36.505, insert the following clause:

                   Material and Workmanship (APR 1984)

    (a) All equipment, material, and articles incorporated into the work 
covered by this contract shall be new and of the most suitable grade for 
the purpose intended, unless otherwise specifically provided in this 
contract. References in the specifications to equipment, material, 
articles, or patented processes by trade name, make, or catalog

[[Page 266]]

number, shall be regarded as establishing a standard of quality and 
shall not be construed as limiting competition. The Contractor may, at 
its option, use any equipment, material, article, or process that, in 
the judgment of the Contracting Officer, is equal to that named in the 
specifications, unless otherwise specifically provided in this contract.
    (b) The Contractor shall obtain the Contracting Officer's approval 
of the machinery and mechanical and other equipment to be incorporated 
into the work. When requesting approval, the Contractor shall furnish to 
the Contracting Officer the name of the manufacturer, the model number, 
and other information concerning the performance, capacity, nature, and 
rating of the machinery and mechanical and other equipment. When 
required by this contract or by the Contracting Officer, the Contractor 
shall also obtain the Contracting Officer's approval of the material or 
articles which the Contractor contemplates incorporating into the work. 
When requesting approval, the Contractor shall provide full information 
concerning the material or articles. When directed to do so, the 
Contractor shall submit samples for approval at the Contractor's 
expense, with all shipping charges prepaid. Machinery, equipment, 
material, and articles that do not have the required approval shall be 
installed or used at the risk of subsequent rejection.
    (c) All work under this contract shall be performed in a skillful 
and workmanlike manner. The Contracting Officer may require, in writing, 
that the Contractor remove from the work any employee the Contracting 
Officer deems incompetent, careless, or otherwise objectionable.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 48995, Nov. 28, 1989]



Sec.  52.236-6  Superintendence by the Contractor.

    As prescribed in 36.506, insert the following clause:

              Superintendence by the Contractor (APR 1984)

    At all times during performance of this contract and until the work 
is completed and accepted, the Contractor shall directly superintend the 
work or assign and have on the work a competent superintendent who is 
satisfactory to the Contracting Officer and has authority to act for the 
Contractor.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34761, July 3, 1995]



Sec.  52.236-7  Permits and Responsibilities.

    As prescribed in 36.507, insert the following clause:

                 Permits and Responsibilities (NOV 1991)

    The Contractor shall, without additional expense to the Government, 
be responsible for obtaining any necessary licenses and permits, and for 
complying with any Federal, State, and municipal laws, codes, and 
regulations applicable to the performance of the work. The Contractor 
shall also be responsible for all damages to persons or property that 
occur as a result of the Contractor's fault or negligence. The 
Contractor shall also be responsible for all materials delivered and 
work performed until completion and acceptance of the entire work, 
except for any completed unit of work which may have been accepted under 
the contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 48995, Nov. 28, 1989; 
56 FR 55376, Oct. 25, 1992]



Sec.  52.236-8  Other Contracts.

    As prescribed in 36.508, insert the following clause:

                       Other Contracts (APR 1984)

    The Government may undertake or award other contracts for additional 
work at or near the site of the work under this contract. The Contractor 
shall fully cooperate with the other contractors and with Government 
employees and shall carefully adapt scheduling and performing the work 
under this contract to accommodate the additional work, heeding any 
direction that may be provided by the Contracting Officer. The 
Contractor shall not commit or permit any act that will interfere with 
the performance of work by any other contractor or by Government 
employees.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34761, July 3, 1995]



Sec.  52.236-9  Protection of Existing Vegetation, Structures, Equipment, 
Utilities, and Improvements.

    As prescribed in 36.509, insert the following clause:

[[Page 267]]

Protection of Existing Vegetation, Structures, Equipment, Utilities, and 
                         Improvements (APR 1984)

    (a) The Contractor shall preserve and protect all structures, 
equipment, and vegetation (such as trees, shrubs, and grass) on or 
adjacent to the work site, which are not to be removed and which do not 
unreasonably interfere with the work required under this contract. The 
Contractor shall only remove trees when specifically authorized to do 
so, and shall avoid damaging vegetation that will remain in place. If 
any limbs or branches of trees are broken during contract performance, 
or by the careless operation of equipment, or by workmen, the Contractor 
shall trim those limbs or branches with a clean cut and paint the cut 
with a tree-pruning compound as directed by the Contracting Officer.
    (b) The Contractor shall protect from damage all existing 
improvements and utilities (1) at or near the work site and (2) on 
adjacent property of a third party, the locations of which are made 
known to or should be known by the Contractor. The Contractor shall 
repair any damage to those facilities, including those that are the 
property of a third party, resulting from failure to comply with the 
requirements of this contract or failure to exercise reasonable care in 
performing the work. If the Contractor fails or refuses to repair the 
damage promptly, the Contracting Officer may have the necessary work 
performed and charge the cost to the Contractor.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34761, July 3, 1995]



Sec.  52.236-10  Operations and Storage Areas.

    As prescribed in 36.510, insert the following clause:

                 Operations and Storage Areas (APR 1984)

    (a) The Contractor shall confine all operations (including storage 
of materials) on Government premises to areas authorized or approved by 
the Contracting Officer. The Contractor shall hold and save the 
Government, its officers and agents, free and harmless from liability of 
any nature occasioned by the Contractor's performance.
    (b) Temporary buildings (e.g., storage sheds, shops, offices) and 
utilities may be erected by the Contractor only with the approval of the 
Contracting Officer and shall be built with labor and materials 
furnished by the Contractor without expense to the Government. The 
temporary buildings and utilities shall remain the property of the 
Contractor and shall be removed by the Contractor at its expense upon 
completion of the work. With the written consent of the Contracting 
Officer, the buildings and utilities may be abandoned and need not be 
removed.
    (c) The Contractor shall, under regulations prescribed by the 
Contracting Officer, use only established roadways, or use temporary 
roadways constructed by the Contractor when and as authorized by the 
Contracting Officer. When materials are transported in prosecuting the 
work, vehicles shall not be loaded beyond the loading capacity 
recommended by the manufacturer of the vehicle or prescribed by any 
Federal, State, or local law or regulation. When it is necessary to 
cross curbs or sidewalks, the Contractor shall protect them from damage. 
The Contractor shall repair or pay for the repair of any damaged curbs, 
sidewalks, or roads.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34761, July 3, 1995]



Sec.  52.236-11  Use and Possession Prior to Completion.

    As prescribed in 36.511, insert the following clause:

            Use and Possession Prior to Completion (APR 1984)

    (a) The Government shall have the right to take possession of or use 
any completed or partially completed part of the work. Before taking 
possession of or using any work, the Contracting Officer shall furnish 
the Contractor a list of items of work remaining to be performed or 
corrected on those portions of the work that the Government intends to 
take possession of or use. However, failure of the Contracting Officer 
to list any item of work shall not relieve the Contractor of 
responsibility for complying with the terms of the contract. The 
Government's possession or use shall not be deemed an acceptance of any 
work under the contract.
    (b) While the Government has such possession or use, the Contractor 
shall be relieved of the responsibility for the loss of or damage to the 
work resulting from the Government's possession or use, notwithstanding 
the terms of the clause in this contract entitled Permits and 
Responsibilities. If prior possession or use by the Government delays 
the progress of the work or causes additional expense to the Contractor, 
an equitable adjustment shall be made in the contract price or the time 
of completion, and the contract shall be modified in writing 
accordingly.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34761, July 3, 1995]

[[Page 268]]



Sec.  52.236-12  Cleaning Up.

    As prescribed in 36.512, insert the following clause:

                         Cleaning Up (APR 1984)

    The Contractor shall at all times keep the work area, including 
storage areas, free from accumulations of waste materials. Before 
completing the work, the Contractor shall remove from the work and 
premises any rubbish, tools, scaffolding, equipment, and materials that 
are not the property of the Government. Upon completing the work, the 
Contractor shall leave the work area in a clean, neat, and orderly 
condition satisfactory to the Contracting Officer.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34761, July 3, 1995]



Sec.  52.236-13  Accident Prevention.

    As prescribed in 36.513, insert the following clause:

                     Accident Prevention (NOV 1991)

    (a) The Contractor shall provide and maintain work environments and 
procedures which will (1) safeguard the public and Government personnel, 
property, materials, supplies, and equipment exposed to Contractor 
operations and activities; (2) avoid interruptions of Government 
operations and delays in project completion dates; and (3) control costs 
in the performance of this contract.
    (b) For these purposes on contracts for construction or dismantling, 
demolition, or removal of improvements, the Contractor shall--
    (1) Provide appropriate safety barricades, signs, and signal lights;
    (2) Comply with the standards issued by the Secretary of Labor at 29 
CFR part 1926 and 29 CFR part 1910; and
    (3) Ensure that any additional measures the Contracting Officer 
determines to be reasonably necessary for the purposes are taken.
    (c) If this contract is for construction or dismantling, demolition 
or removal of improvements with any Department of Defense agency or 
component, the Contractor shall comply with all pertinent provisions of 
the latest version of U.S. Army Corps of Engineers Safety and Health 
Requirements Manual, EM 385-1-1, in effect on the date of the 
solicitation.
    (d) Whenever the Contracting Officer becomes aware of any 
noncompliance with these requirements or any condition which poses a 
serious or imminent danger to the health or safety of the public or 
Government personnel, the Contracting Officer shall notify the 
Contractor orally, with written confirmation, and request immediate 
initiation of corrective action. This notice, when delivered to the 
Contractor or the Contractor's representative at the work site, shall be 
deemed sufficient notice of the noncompliance and that corrective action 
is required. After receiving the notice, the Contractor shall 
immediately take corrective action. If the Contractor fails or refuses 
to promptly take corrective action, the Contracting Officer may issue an 
order stopping all or part of the work until satisfactory corrective 
action has been taken. The Contractor shall not be entitled to any 
equitable adjustment of the contract price or extension of the 
performance schedule on any stop work order issued under this clause.
    (e) The Contractor shall insert this clause, including this 
paragraph (e), with appropriate changes in the designation of the 
parties, in subcontracts.

                             (End of clause)

    Alternate I (Nov 1991). If the contract will involve (a) work of a 
long duration or hazardous nature, or (b) performance on a Government 
facility that on the advice of technical representatives involves 
hazardous materials or operations that might endanger the safety of the 
public and/or Government personnel or property, add the following 
paragraph (f) to the basic clause:

    (f) Before commencing the work, the Contractor shall--
    (1) Submit a written proposed plan for implementing this clause. The 
plan shall include an analysis of the significant hazards to life, limb, 
and property inherent in contract work performance and a plan for 
controlling these hazards; and
    (2) Meet with representatives of the Contracting Officer to discuss 
and develop a mutual understanding relative to administration of the 
overall safety program.

[56 FR 55376, Oct. 25, 1991]



Sec.  52.236-14  Availability and Use of Utility Services.

    As prescribed in 36.514, insert the following clause in 
solicitations and contracts when a fixed-price construction contract or 
a fixed-price dismantling, demolition, or removal of improvements 
contract is contemplated, the contract is to be performed on Government 
sites when the contracting officer decides (a) that the existing utility 
system is adequate for the needs of both the Government and the 
contractor, and (b) furnishing it is in the Government's interest. When 
this

[[Page 269]]

clause is used, the contracting officer shall list the available 
utilities in the contract.

           Availability and Use of Utility Services (APR 1984)

    (a) The Government shall make all reasonably required amounts of 
utilities available to the Contractor from existing outlets and 
supplies, as specified in the contract. Unless otherwise provided in the 
contract, the amount of each utility service consumed shall be charged 
to or paid for by the Contractor at prevailing rates charged to the 
Government or, where the utility is produced by the Government, at 
reasonable rates determined by the Contracting Officer. The Contractor 
shall carefully conserve any utilities furnished without charge.
    (b) The Contractor, at its expense and in a workmanlike manner 
satisfactory to the Contracting Officer, shall install and maintain all 
necessary temporary connections and distribution lines, and all meters 
required to measure the amount of each utility used for the purpose of 
determining charges. Before final acceptance of the work by the 
Government, the Contractor shall remove all the temporary connections, 
distribution lines, meters, and associated paraphernalia.

                             (End of clause)



Sec.  52.236-15  Schedules for Construction Contracts.

    As prescribed in 36.515, insert the following clause:

             Schedules for Construction Contracts (APR 1984)

    (a) The Contractor shall, within five days after the work commences 
on the contract or another period of time determined by the Contracting 
Officer, prepare and submit to the Contracting Officer for approval 
three copies of a practicable schedule showing the order in which the 
Contractor proposes to perform the work, and the dates on which the 
Contractor contemplates starting and completing the several salient 
features of the work (including acquiring materials, plant, and 
equipment). The schedule shall be in the form of a progress chart of 
suitable scale to indicate appropriately the percentage of work 
scheduled for completion by any given date during the period. If the 
Contractor fails to submit a schedule within the time prescribed, the 
Contracting Officer may withhold approval of progress payments until the 
Contractor submits the required schedule.
    (b) The Contractor shall enter the actual progress on the chart as 
directed by the Contracting Officer, and upon doing so shall immediately 
deliver three copies of the annotated schedule to the Contracting 
Officer. If, in the opinion of the Contracting Officer, the Contractor 
falls behind the approved schedule, the Contractor shall take steps 
necessary to improve its progress, including those that may be required 
by the Contracting Officer, without additional cost to the Government. 
In this circumstance, the Contracting Officer may require the Contractor 
to increase the number of shifts, overtime operations, days of work, 
and/or the amount of construction plant, and to submit for approval any 
supplementary schedule or schedules in chart form as the Contracting 
Officer deems necessary to demonstrate how the approved rate of progress 
will be regained.
    (c) Failure of the Contractor to comply with the requirements of the 
Contracting Officer under this clause shall be grounds for a 
determination by the Contracting Officer that the Contractor is not 
prosecuting the work with sufficient diligence to ensure completion 
within the time specified in the contract. Upon making this 
determination, the Contracting Officer may terminate the Contractor's 
right to proceed with the work, or any separable part of it, in 
accordance with the default terms of this contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34761, July 3, 1995]



Sec.  52.236-16  Quantity Surveys.

    As prescribed in 36.516, the contracting officer may insert the 
following clause in solicitations and contracts when a fixed-price 
construction contract providing for unit pricing of items and for 
payment based on quantity surveys is contemplated:

                       Quantity Surveys (APR 1984)

    (a) Quantity surveys shall be conducted, and the data derived from 
these surveys shall be used in computing the quantities of work 
performed and the actual construction completed and in place.
    (b) The Government shall conduct the original and final surveys and 
make the computations based on them. The Contractor shall conduct the 
surveys for any periods for which progress payments are requested and 
shall make the computations based on these surveys. All surveys 
conducted by the Contractor shall be conducted under the direction of a 
representative of the Contracting Officer, unless the Contracting 
Officer waives this requirement in a specific instance.
    (c) Promptly upon completing a survey, the Contractor shall furnish 
the originals of all field notes and all other records relating

[[Page 270]]

to the survey or to the layout of the work to the Contracting Officer, 
who shall use them as necessary to determine the amount of progress 
payments. The Contractor shall retain copies of all such material 
furnished to the Contracting Officer.

                             (End of clause)

    Alternate I (APR 1984). If it is determined at a level above that of 
the contracting officer that it is impracticable for Government 
personnel to perform the original and final surveys, and the Government 
wishes the contractor to perform these surveys, substitute the following 
paragraph (b) for paragraph (b) of the basic clause:

    (b) The Contractor shall conduct the original and final surveys and 
surveys for any periods for which progress payments are requested. All 
these surveys shall be conducted under the direction of a representative 
of the Contracting Officer, unless the Contracting Officer waives this 
requirement in a specific instance. The Government shall make such 
computations as are necessary to determine the quantities of work 
performed or finally in place. The Contractor shall make the 
computations based on the surveys for any periods for which progress 
payments are requested.



Sec.  52.236-17  Layout of Work.

    As prescribed in 36.517, insert the following clause in 
solicitations and contracts when a fixed-price construction contract is 
contemplated and use of this clause is appropriate due to a need for 
accurate work layout and for siting verification during work 
performance:

                        Layout of Work (APR 1984)

    The Contractor shall lay out its work from Government-established 
base lines and bench marks indicated on the drawings, and shall be 
responsible for all measurements in connection with the layout. The 
Contractor shall furnish, at its own expense, all stakes, templates, 
platforms, equipment, tools, materials, and labor required to lay out 
any part of the work. The Contractor shall be responsible for executing 
the work to the lines and grades that may be established or indicated by 
the Contracting Officer. The Contractor shall also be responsible for 
maintaining and preserving all stakes and other marks established by the 
Contracting Officer until authorized to remove them. If such marks are 
destroyed by the Contractor or through its negligence before their 
removal is authorized, the Contracting Officer may replace them and 
deduct the expense of the replacement from any amounts due or to become 
due to the Contractor.

                             (End of clause)



Sec.  52.236-18  Work Oversight in Cost-Reimbursement Construction Contracts.

    As prescribed in 36.518, insert the following clause in 
solicitations and contracts when cost-reimbursement construction 
contracts are contemplated:

 Work Oversight in Cost-Reimbursement Construction Contracts (APR 1984)

    The extent and character of the work to be done by the Contractor 
shall be subject to the general supervision, direction, control, and 
approval of the Contracting Officer.

                             (End of clause)



Sec.  52.236-19  Organization and Direction of the Work.

    As prescribed in 36.519, insert the following clause in 
solicitations and contracts when a cost-reimbursement construction 
contract is contemplated:

            Organization and Direction of the Work (APR 1984)

    (a) When this contract is executed, the Contractor shall submit to 
the Contracting Officer a chart showing the general executive and 
administrative organization, the personnel to be employed in connection 
with the work under this contract, and their respective duties. The 
Contractor shall keep the data furnished current by supplementing it as 
additional information becomes available.
    (b) Work performance under this contract shall be under the full-
time resident direction of: (1) the Contractor, if the Contractor is an 
individual; (2) one or more principal partners, if the Contractor is a 
partnership; or (3) one or more senior officers, if Contractor is a 
corporation, association, or similar legal entity. However, if the 
Contracting Officer approves, the Contractor may be represented in the 
direction of the work by a specific person or persons holding positions 
other than those identified in this paragraph.

                             (End of clause)



Sec.  52.236-20  [Reserved]



Sec.  52.236-21  Specifications and Drawings for Construction.

    As prescribed in 36.521, insert the following clause:

[[Page 271]]

         Specifications and Drawings for Construction (FEB 1997)

    (a) The Contractor shall keep on the work site a copy of the 
drawings and specifications and shall at all times give the Contracting 
Officer access thereto. Anything mentioned in the specifications and not 
shown on the drawings, or shown on the drawings and not mentioned in the 
specifications, shall be of like effect as if shown or mentioned in 
both. In case of difference between drawings and specifications, the 
specifications shall govern. In case of discrepancy in the figures, in 
the drawings, or in the specifications, the matter shall be promptly 
submitted to the Contracting Officer, who shall promptly make a 
determination in writing. Any adjustment by the Contractor without such 
a determination shall be at its own risk and expense. The Contracting 
Officer shall furnish from time to time such detailed drawings and other 
information as considered necessary, unless otherwise provided.
    (b) Wherever in the specifications or upon the drawings the words 
directed, required, ordered, designated, prescribed, or words of like 
import are used, it shall be understood that the direction, requirement, 
order, designation, or prescription, of the Contracting Officer is 
intended and similarly the words approved, acceptable, satisfactory, or 
words of like import shall mean approved by, or acceptable to, or 
satisfactory to the Contracting Officer, unless otherwise expressly 
stated.
    (c) Where as shown, as indicated, as detailed, or words of similar 
import are used, it shall be understood that the reference is made to 
the drawings accompanying this contract unless stated otherwise. The 
word provided as used herein shall be understood to mean provide 
complete in place, that is furnished and installed.
    (d) Shop drawings means drawings, submitted to the Government by the 
Contractor, subcontractor, or any lower tier subcontractor pursuant to a 
construction contract, showing in detail (1) the proposed fabrication 
and assembly of structural elements and (2) the installation (i.e., 
form, fit, and attachment details) of materials or equipment. It 
includes drawings, diagrams, layouts, schematics, descriptive 
literature, illustrations, schedules, performance and test data, and 
similar materials furnished by the contractor to explain in detail 
specific portions of the work required by the contract. The Government 
may duplicate, use, and disclose in any manner and for any purpose shop 
drawings delivered under this contract.
    (e) If this contract requires shop drawings, the Contractor shall 
coordinate all such drawings, and review them for accuracy, 
completeness, and compliance with contract requirements and shall 
indicate its approval thereon as evidence of such coordination and 
review. Shop drawings submitted to the Contracting Officer without 
evidence of the Contractor's approval may be returned for resubmission. 
The Contracting Officer will indicate an approval or disapproval of the 
shop drawings and if not approved as submitted shall indicate the 
Government's reasons therefor. Any work done before such approval shall 
be at the Contractor's risk. Approval by the Contracting Officer shall 
not relieve the Contractor from responsibility for any errors or 
omissions in such drawings, nor from responsibility for complying with 
the requirements of this contract, except with respect to variations 
described and approved in accordance with (f) below.
    (f) If shop drawings show variations from the contract requirements, 
the Contractor shall describe such variations in writing, separate from 
the drawings, at the time of submission. If the Contracting Officer 
approves any such variation, the Contracting Officer shall issue an 
appropriate contract modification, except that, if the variation is 
minor or does not involve a change in price or in time of performance, a 
modification need not be issued.
    (g) The Contractor shall submit to the Contracting Officer for 
approval four copies (unless otherwise indicated) of all shop drawings 
as called for under the various headings of these specifications. Three 
sets (unless otherwise indicated) of all shop drawings, will be retained 
by the Contracting Officer and one set will be returned to the 
Contractor.

                             (End of clause)

    Alternate I (APR 1984). When record shop drawings are required and 
reproducible shop drawings are needed, add the following sentences to 
paragraph (g) of the basic clause:

Upon completing the work under this contract, the Contractor shall 
furnish a complete set of all shop drawings as finally approved. These 
drawings shall show all changes and revisions made up to the time the 
equipment is completed and accepted.

    Alternate II (APR 1984). When record shop drawings are required and 
reproducible shop drawings are not needed, the following sentences shall 
be added to paragraph (g) of the basic clause:

Upon completing the work under this contract, the Contractor shall 
furnish ------ [Contracting Officer complete by inserting desired 
amount] sets of prints of all shop drawings as finally approved. These 
drawings shall show changes and revisions made up to

[[Page 272]]

the time the equipment is completed and accepted.

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 38518, Sept. 18, 1990; 
56 FR 41744, Aug. 22, 1991; 60 FR 34761, July 3, 1995; 61 FR 67426, Dec. 
20, 1996]



Sec.  52.236-22  Design Within Funding Limitations.

    As prescribed in 36.609-1(c), insert the following clause:

              Design Within Funding Limitations (APR 1984)

    (a) The Contractor shall accomplish the design services required 
under this contract so as to permit the award of a contract, using 
standard Federal Acquisition Regulation procedures for the construction 
of the facilities designed at a price that does not exceed the estimated 
construction contract price as set forth in paragraph (c) below. When 
bids or proposals for the construction contract are received that exceed 
the estimated price, the contractor shall perform such redesign and 
other services as are necessary to permit contract award within the 
funding limitation. These additional services shall be performed at no 
increase in the price of this contract. However, the Contractor shall 
not be required to perform such additional services at no cost to the 
Government if the unfavorable bids or proposals are the result of 
conditions beyond its reasonable control.
    (b) The Contractor will promptly advise the Contracting Officer if 
it finds that the project being designed will exceed or is likely to 
exceed the funding limitations and it is unable to design a usable 
facility within these limitations. Upon receipt of such information, the 
Contracting Officer will review the Contractor's revised estimate of 
construction cost. The Government may, if it determines that the 
estimated construction contract price set forth in this contract is so 
low that award of a construction contract not in excess of such estimate 
is improbable, authorize a change in scope or materials as required to 
reduce the estimated construction cost to an amount within the estimated 
construction contract price set forth in paragraph (c) below, or the 
Government may adjust such estimated construction contract price. When 
bids or proposals are not solicited or are unreasonably delayed, the 
Government shall prepare an estimate of constructing the design 
submitted and such estimate shall be used in lieu of bids or proposals 
to determine compliance with the funding limitation.
    (c) The estimated construction contract price for the project 
described in this contract is $----.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 26904, June 28, 1985]



Sec.  52.236-23  Responsibility of the Architect-Engineer Contractor.

    As prescribed in 36.609-2(b), insert the following clause:

     Responsibility of the Architect-Engineer Contractor (APR 1984)

    (a) The Contractor shall be responsible for the professional 
quality, technical accuracy, and the coordination of all designs, 
drawings, specifications, and other services furnished by the Contractor 
under this contract. The Contractor shall, without additional 
compensation, correct or revise any errors or deficiencies in its 
designs, drawings, specifications, and other services.
    (b) Neither the Government's review, approval or acceptance of, nor 
payment for, the services required under this contract shall be 
construed to operate as a waiver of any rights under this contract or of 
any cause of action arising out of the performance of this contract, and 
the Contractor shall be and remain liable to the Government in 
accordance with applicable law for all damages to the Government caused 
by the Contractor's negligent performance of any of the services 
furnished under this contract.
    (c) The rights and remedies of the Government provided for under 
this contract are in addition to any other rights and remedies provided 
by law.
    (d) If the Contractor is comprised of more than one legal entity, 
each such entity shall be jointly and severally liable hereunder.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 26904, June 28, 1985]



Sec.  52.236-24  Work Oversight in Architect-Engineer Contracts.

    As prescribed in 36.609-3, insert the following clause:

        Work Oversight in Architect-Engineer Contracts (APR 1984)

    The extent and character of the work to be done by the Contractor 
shall be subject to the general oversight, supervision, direction, 
control, and approval of the Contracting Officer.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 26904, June 28, 1985]

[[Page 273]]



Sec.  52.236-25  Requirements for Registration of Designers.

    As prescribed in 36.609-4, insert the following clause:

         Requirements for Registration of Designers (June 2003)

    Architects or engineers registered to practice in the particular 
professional field involved in a State, the District of Columbia, or an 
outlying area of the United States shall prepare or review and approve 
the design of architectural, structural, mechanical, electrical, civil, 
or other engineering features of the work.

                             (End of clause)

[68 FR 28087, May 22, 2003]



Sec.  52.236-26  Preconstruction Conference.

    As prescribed in 36.522, insert the following clause:

                  Preconstruction Conference (FEB 1995)

    If the Contracting Officer decides to conduct a preconstruction 
conference, the successful offeror will be notified and will be required 
to attend. The Contracting Officer's notification will include specific 
details regarding the date, time, and location of the conference, any 
need for attendance by subcontractors, and information regarding the 
items to be discussed.

                             (End of clause)

[59 FR 67050, Dec. 28, 1994]



Sec.  52.236-27  Site Visit (Construction).

    As prescribed in 36.523, insert a provision substantially the same 
as the following:

                  Site Visit (Construction) (FEB 1995)

    (a) The clauses at 52.236-2, Differing Site Conditions, and 52.236-
3, Site Investigation and Conditions Affecting the Work, will be 
included in any contract awarded as a result of this solicitation. 
Accordingly, offerors or quoters are urged and expected to inspect the 
site where the work will be performed.
    (b) Site visits may be arranged during normal duty hours by 
contacting:
Name:___________________________________________________________________

Address:________________________________________________________________
________________________________________________________________________

Telephone:______________________________________________________________

                           (End of provision)

    Alternate I (FEB 1995). If an organized site visit will be 
conducted, substitute a paragraph substantially the same as the 
following for paragraph (b) of the basic provision:

    (b) An organized site visit has been scheduled for--

________________________________________________________________________
[Insert date and time]

    (c) Participants will meet at--
________________________________________________________________________
[Insert location]

                           (End of provision)

[59 FR 67050, Dec. 28, 1994; 60 FR 14377, Mar. 17, 1995]



Sec.  52.236-28  Preparation of Proposals--Construction.

    As prescribed in 36.520, insert the following provision:

            Preparation of Proposals--Construction (OCT 1997)

    (a) Proposals must be (1) submitted on the forms furnished by the 
Government or on copies of those forms, and (2) manually signed. The 
person signing a proposal must initial each erasure or change appearing 
on any proposal form.
    (b) The proposal form may require offerors to submit proposed prices 
for one or more items on various bases, including--
    (1) Lump sum price;
    (2) Alternate prices;
    (3) Units of construction; or
    (4) Any combination of paragraphs (b)(1) through (b)(3) of this 
provision.
    (c) If the solicitation requires submission of a proposal on all 
items, failure to do so may result in the proposal being rejected 
without further consideration. If a proposal on all items is not 
required, offerors should insert the words ``no proposal'' in the space 
provided for any item on which no price is submitted.
    (d) Alternate proposals will not be considered unless this 
solicitation authorizes their submission.

                           (End of provision)

[62 FR 51265, Sept. 30, 1997]



Sec.  52.237-1  Site Visit.

    As prescribed in 37.110(a), insert the following provision in 
solicitations for services to be performed on Government installations, 
unless the solicitation is for construction:

                          Site Visit (APR 1984)

    Offerors or quoters are urged and expected to inspect the site where 
services are to be

[[Page 274]]

performed and to satisfy themselves regarding all general and local 
conditions that may affect the cost of contract performance, to the 
extent that the information is reasonably obtainable. In no event shall 
failure to inspect the site constitute grounds for a claim after 
contract award.

                           (End of provision)



Sec.  52.237-2  Protection of Government Buildings, Equipment, and Vegetation.

    As prescribed in 37.110(b), insert the following clause in 
solicitations and contracts for services to be performed on Government 
installations, unless a construction contract is contemplated:

Protection of Government Buildings, Equipment, and Vegetation (APR 1984)

    The Contractor shall use reasonable care to avoid damaging existing 
buildings, equipment, and vegetation on the Government installation. If 
the Contractor's failure to use reasonable care causes damage to any of 
this property, the Contractor shall replace or repair the damage at no 
expense to the Government as the Contracting Officer directs. If the 
Contractor fails or refuses to make such repair or replacement, the 
Contractor shall be liable for the cost, which may be deducted from the 
contract price.

                             (End of clause)



Sec.  52.237-3  Continuity of Services.

    As prescribed in 37.110(c), insert the following clause:

                    Continuity of Services (JAN 1991)

    (a) The Contractor recognizes that the services under this contract 
are vital to the Government and must be continued without interruption 
and that, upon contract expiration, a successor, either the Government 
or another contractor, may continue them. The Contractor agrees to (1) 
furnish phase-in training and (2) exercise its best efforts and 
cooperation to effect an orderly and efficient transition to a 
successor.
    (b) The Contractor shall, upon the Contracting Officer's written 
notice, (1) furnish phase-in, phase-out services for up to 90 days after 
this contract expires and (2) negotiate in good faith a plan with a 
successor to determine the nature and extent of phase-in, phase-out 
services required. The plan shall specify a training program and a date 
for transferring responsibilities for each division of work described in 
the plan, and shall be subject to the Contracting Officer's approval. 
The Contractor shall provide sufficient experienced personnel during the 
phase-in, phase-out period to ensure that the services called for by 
this contract are maintained at the required level of proficiency.
    (c) The Contractor shall allow as many personnel as practicable to 
remain on the job to help the successor maintain the continuity and 
consistency of the services required by this contract. The Contractor 
also shall disclose necessary personnel records and allow the successor 
to conduct on-site interviews with these employees. If selected 
employees are agreeable to the change, the Contractor shall release them 
at a mutually agreeable date and negotiate transfer of their earned 
fringe benefits to the successor.
    (d) The Contractor shall be reimbursed for all reasonable phase-in, 
phase-out costs (i.e., costs incurred within the agreed period after 
contract expiration that result from phase-in, phase-out operations) and 
a fee (profit) not to exceed a pro rata portion of the fee (profit) 
under this contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 52799, Dec. 21, 1990; 
62 FR 40238, July 25, 1997]



Sec.  52.237-4  Payment by Government to Contractor.

    As prescribed in 37.304(a), insert the following clause in 
solicitations and contracts solely for dismantling, demolition, or 
removal of improvements whenever the contracting officer determines that 
the Government shall make payment to the contractor in addition to any 
title to property that the contractor may receive under the contract:

             Payment by Government to Contractor (APR 1984)

    (a) In ---- [insert full if Alternate I is used; otherwise insert 
partial] consideration of the performance of the work called for in the 
Schedule, the Government will pay to the Contractor ---- [fill in 
amount].
    (b) The Government shall make progress payments monthly as the work 
proceeds, or at more frequent intervals as determined by the Contracting 
Officer, on estimates approved by the Contracting Officer. Except as 
provided in paragraph (c) below, in making progress payments the 
Contracting Officer shall retain 10 percent of the estimated payment 
until final completion and acceptance of the contract work. However, if 
the Contracting Officer finds that satisfactory progress was achieved 
during any period for which a progress payment is to be made, the 
Contracting Officer may authorize such payment in full, without 
retaining a percentage. Also, on completion and acceptance of each unit 
or division for which the price is stated

[[Page 275]]

separately, the Contracting Officer may authorize full payment for that 
unit or division without retaining a percentage.
    (c) When the work is substantially completed, the Contracting 
Officer shall retain an amount considered adequate for the protection of 
the Government and, at the Contracting Officer's discretion, may release 
all or a portion of any excess amount.
    (d) In further consideration of performance, the Contractor shall 
receive title to all property to be dismantled or demolished that is not 
specifically designated as being retained by the Government. The title 
shall vest in the Contractor immediately upon the Government's issuing 
the notice of award, or if a performance bond is to be furnished after 
award, upon the Government's issuance of a notice to proceed with the 
work. The Government shall not be responsible for the condition of, or 
any loss or damage to, the property. If the Contractor does not wish to 
remove from the site any of the property acquired, the Contracting 
Officer may, upon written request, grant the Contractor permission to 
leave the property on the premises. As a condition to the granting of 
this permission, the Contractor agrees to waive any right, title, claim, 
or interest in and to the property.
    (e) Upon completion and acceptance of all work and receipt of a 
properly executed voucher, the Government shall make final payment of 
the amount due the Contractor under this contract. If requested, the 
Contractor shall release all claims against the Government arising under 
this contract, other than any claims the Contractor specifically 
excepts, in stated amounts, from operation of this release.

                             (End of clause)

    Alternate I (APR 1984). If the contracting officer determines that 
the Government shall retain all material resulting from the dismantling 
or demolition work, delete paragraph (d) from the basic clause and 
renumber the remaining paragraphs.



Sec.  52.237-5  Payment by Contractor to Government.

    As prescribed in 37.304(b), insert the following clause in 
solicitations and contracts for dismantling, demolition, or removal of 
improvements whenever the contractor is to receive title to dismantled 
or demolished property and a net amount of compensation is due to the 
Government, except if the contracting officer determines that it would 
be advantageous to the Government for the contractor to pay in 
increments and the Government to transfer title to the contractor for 
increments of property only upon receipt of those payments:

             Payment by Contractor to Government (APR 1984)

    (a) The Contractor shall receive title to all property to be 
dismantled, demolished, or removed under this contract and not 
specifically designated in the Schedule as being retained by the 
Government. The title shall vest in the Contractor immediately upon the 
Government's issuing the notice of award, or if a performance bond is to 
be furnished, upon the Government's issuing a notice to proceed with the 
work. The Government shall not be responsible for the condition of, or 
any loss or damage to, the property.
    (b) The Contractor shall promptly remove from the site all property 
acquired by the Contractor. The Government shall not permit storage of 
property on the site beyond the completion date. If the Contractor does 
not wish to remove from the site any of the property acquired, the 
Contracting Officer may, upon written request, grant the Contractor 
permission to leave the property on the premises. As a condition of the 
granting of the permission, the Contractor agrees to waive any right, 
title, claim, or interest in and to the property.
    (c) The Contractor shall perform the work called for under this 
contract and within -- days of receipt of notice of award, unless 
otherwise provided in the Schedule and before proceeding with the work, 
shall pay ---- [fill in amount]. Checks shall be made payable to the 
office designated in the contract and shall be forwarded to the 
Contracting Officer.

                             (End of clause)



Sec.  52.237-6  Incremental Payment by Contractor to Government.

    As prescribed in 37.304(c), insert the following clause in 
solicitations and contracts for dismantling, demolition, or removal of 
improvements (a) if the contractor is to receive title to dismantled or 
demolished property and a net amount of compensation is due the 
Government, and (b) if the contracting officer determines that it would 
be advantageous to the Government for the contractor to pay in 
increments, and for the Government to transfer title to the contractor 
for increments of property, only upon receipt of those payments:

[[Page 276]]

       Incremental Payment by Contractor to Government (APR 1984)

    (a) The Contractor shall perform the work called for under this 
contract and within -- days of receipt of notice of award, unless 
otherwise provided in the Schedule, and before proceeding with the work, 
shall pay ---- [fill in amount]. Thereafter, the Contractor shall make 
payment to the Government in the amount and frequency specified in the 
Schedule. Checks shall be made payable to the office designated in the 
contract and shall be forwarded to the Contracting Officer.
    (b) Upon the Government's receipt of each increment of payment, the 
Contractor shall receive title to such property as the Contracting 
Officer determines to be fair and reasonable for that increment of 
payment. Upon receipt of the Contractor's final payment, all title that 
has not passed to the Contractor shall vest in the Contractor, unless 
specifically designated in the Schedule as being retained by the 
Government. The Government shall not be responsible for the condition 
of, or any loss or damage to, the property.
    (c) The Contractor shall promptly remove from the site all property 
acquired by the Contractor. The Government will not permit storage of 
property on the site beyond the completion date. If the Contractor does 
not wish to remove from the site any of the property acquired, the 
Contracting Officer may, upon written request, grant the Contractor 
permission to leave the property on the premises. As a condition of the 
granting of this permission, the Contractor agrees to waive any right, 
title, claim, or interest in and to the property.

                             (End of clause)



Sec.  52.237-7  Indemnification and Medical Liability Insurance.

    As prescribed in 37.403, insert the following clause:

       Indemnification and Medical Liability Insurance (JAN 1997)

    (a) It is expressly agreed and understood that this is a nonpersonal 
services contract, as defined in Federal Acquisition Regulation (FAR) 
37.101, under which the professional services rendered by the Contractor 
are rendered in its capacity as an independent contractor. The 
Government may evaluate the quality of professional and administrative 
services provided, but retains no control over professional aspects of 
the services rendered, including by example, the Contractor's 
professional medical judgment, diagnosis, or specific medical 
treatments. The Contractor shall be solely liable for and expressly 
agrees to idemnify the Government with respect to any liability 
producing acts or omissions by it or by its employees or agents. The 
Contractor shall maintain during the term of this contract liability 
insurance issued by a responsible insurance carrier of not less than the 
following amount(s) per specialty per occurrence:------------.
    (b) An apparently successful offeror, upon request by the 
Contracting Officer, shall furnish prior to contract award evidence of 
its insurability concerning the medical liability insurance required by 
paragraph (a) of this clause.
    (c) Liability insurance may be on either an occurrences basis or on 
a claims-made basis. If the policy is on a claims-made basis, an 
extended reporting endorsement (tail) for a period of not less than 3 
years after the end of the contract term must also be provided.
    (d) Evidence of insurance documenting the required coverage for each 
health care provider who will perform under this contract shall be 
provided to the Contracting Officer prior to the commencement of 
services under this contract. If the insurance is on a claims-made basis 
and evidence of an extended reporting endorsement is not provided prior 
to the commencement of services, evidence of such endorsement shall be 
provided to the Contracting Officer prior to the expiration of this 
contract. Final payment under this contract shall be withheld until 
evidence of the extended reporting endorsement is provided to the 
Contracting Officer.
    (e) The policies evidencing required insurance shall also contain an 
endorsement to the effect that any cancellation or material change 
adversely affecting the Government's interest shall not be effective 
until 30 days after the insurer or the Contractor gives written notice 
to the Contracting Officer. If during the performance period of the 
contract the Contractor changes insurance providers, the Contractor must 
provide evidence that the Government will be indemnified to the limits 
specified in paragraph (a) of this clause, for the entire period of the 
contract, either under the new policy, or a combination of old and new 
policies.
    (f) The Contractor shall insert the substance of this clause, 
including this paragraph (f), in all subcontracts under this contract 
for health care services and shall require such subcontractors to 
provide evidence of and maintain insurance in accordance with paragraph 
(a) of this clause. At least 5 days before the commencement of work by 
any subcontractor, the Contractor shall furnish to the Contracting 
Officer evidence of such insurance.

                             (End of clause)

[54 FR 5058, Jan. 31, 1989, as amended at 54 FR 34758, Aug. 21, 1989; 62 
FR 239, Jan. 2, 1997]

[[Page 277]]



Sec.  52.237-8  Restriction on Severance Payments to Foreign Nationals.

    As prescribed in 37.113-2(a), use the following provision:

   Restriction on Severance Payments to Foreign Nationals (Aug. 2003)

    (a) The Federal Acquisition Regulation (FAR), at 31.205-6(g)(6), 
limits the cost allowability of severance payments to foreign nationals 
employed under a service contract performed outside the United States 
unless the agency grants a waiver pursuant to FAR 37.113-1 before 
contract award.
    (b) In making the determination concerning the granting of a waiver, 
the agency will determine that--
    (1) The application of the severance pay limitations to the contract 
would adversely affect the continuation of a program, project, or 
activity that provides significant support services for (i) members of 
the armed forces stationed or deployed outside the United States, or 
(ii) employees of an executive agency posted outside the United States;
    (2) The Contractor has taken (or has established plans to take) 
appropriate actions within its control to minimize the amount and number 
of incidents of the payment of severance pay to employees under the 
contract who are foreign nationals; and
    (3) The payment of severance pay is necessary in order to comply 
with a law that is generally applicable to a significant number of 
businesses in the country in which the foreign national receiving the 
payment performed services under the contract, or is necessary to comply 
with a collective bargaining agreement.

                           (End of provision)

[60 FR 42661, Aug. 16, 1995, as amended at 68 FR 43867, July 24, 2003]



Sec.  52.237-9  Waiver of Limitation on Severance Payments to Foreign Nationals.

    As prescribed in 37.113-2(b), use the following clause:

 Waiver of Limitation on Severance Payments to Foreign Nationals (Aug. 
                                  2003)

    (a) Pursuant to 10 U.S.C. 2324(e)(3)(A) or 41 U.S.C. 256(e)(2)(A), 
as applicable, the cost allowability limitations in FAR 31.205-6(g)(6) 
are waived.
    (b) This clause may be incorporated into subcontracts issued under 
this contract, if approved by the Contracting Officer.

                             (End of clause)

[60 FR 42662, Aug. 16, 1995, as amended at 68 FR 43867, July 24, 2003]



Sec.  52.237-10   Identification of Uncompensated Overtime.

    As prescribed in 37.115-3, insert the following provision:

           Identification of Uncompensated Overtime (OCT 1997)

    (a) Definitions. As used in this provision--
    Uncompensated overtime means the hours worked without additional 
compensation in excess of an average of 40 hours per week by direct 
charge employees who are exempt from the Fair Labor Standards Act. 
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.
    Uncompensated overtime rate is the rate that 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 per hour would be converted to an 
uncompensated overtime rate of $17.78 per hour ($20.00 x 40 divided by 
45 = $17.78).
    (b) For any proposed hours 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, by labor category 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 that include unrealistically low labor rates, or that 
do not otherwise demonstrate cost realism, will be considered in a risk 
assessment and will be 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)

[62 FR 44816, Aug. 22, 1997]

[[Page 278]]



Sec.  52.238  [Reserved]



Sec.  52.239-1  Privacy or Security Safeguards.

    As prescribed in 39.107, insert a clause substantially the same as 
the following:

                Privacy or Security Safeguards (AUG 1996)

    (a) The Contractor shall not publish or disclose in any manner, 
without the Contracting Officer's written consent, the details of any 
safeguards either designed or developed by the Contractor under this 
contract or otherwise provided by the Government.
    (b) To the extent required to carry out a program of inspection to 
safeguard against threats and hazards to the security, integrity, and 
confidentiality of Government data, the Contractor shall afford the 
Government access to the Contractor's facilities, installations, 
technical capabilities, operations, documentation, records, and 
databases.
    (c) If new or unanticipated threats or hazards are discovered by 
either the Government or the Contractor, or if existing safeguards have 
ceased to function, the discoverer shall immediately bring the situation 
to the attention of the other party.

                             (End of clause)

[61 FR 41472, Aug. 8, 1996, as amended at 62 FR 274, Jan. 2, 1997]



Sec.  52.240  [Reserved]



Sec.  52.241  Utility Services Provisions and Clauses.



Sec.  52.241-1  Electric Service Territory Compliance Representation.

    As prescribed in 41.501(b), insert a provision substantially the 
same as the following:

     Electric Service Territory Compliance Representation (MAY 1999)

    (a) Section 8093 of Public Law 100-202 generally requires purchases 
of electricity by any department, agency, or instrumentality of the 
United States to be consistent with State law governing the provision of 
electric utility service, including State utility commission rulings and 
electric utility franchises or service territories established pursuant 
to State statute, State regulation, or State-approved territorial 
agreements.
    (b) By signing this offer, the offeror represents that this offer to 
sell electricity is consistent with Section 8093 of Public Law 100-202.
    (c) Upon request of the Contracting Officer, the offeror shall 
submit supporting legal and factual rationale for this representation.

                           (End of provision)

[64 FR 10534, Mar. 4, 1999]



Sec.  52.241-2  Order of Precedence--Utilities.

    As prescribed in 41.501(c)(1), insert a clause substantially the 
same as the following:

                Order of Precedence--Utilities (FEB 1995)

    In the event of any inconsistency between the terms of this contract 
(including the specifications) and any rate schedule, rider, or exhibit 
incorporated in this contract by reference or otherwise, or any of the 
Contractor's rules and regulations, the terms of this contract shall 
control.

                             (End of clause)

[59 FR 67023, Dec. 28, 1994]



Sec.  52.241-3  Scope and Duration of Contract.

    As prescribed in 41.501(c)(2), insert a clause substantially the 
same as the following:

                Scope and Duration of Contract (FEB 1995)

    (a) For the period --------------------, [insert period of service] 
the Contractor agrees to furnish and the Government agrees to purchase 
-------------------- [insert type of service] utility service in 
accordance with the applicable tariff(s), rules, and regulations as 
approved by the applicable governing regulatory body and as set forth in 
the contract.
    (b) It is expressly understood that neither the Contractor nor the 
Government is under any obligation to continue any service under the 
terms and conditions of this contract beyond the expiration date.
    (c) The Contractor shall provide the Government with one complete 
set of rates, terms, and conditions of service which are in effect as of 
the date of this contract and any subsequently approved rates.
    (d) The Contractor shall be paid at the applicable rate(s) under the 
tariff and the Government shall be liable for the minimum monthly 
charge, if any, specified in this contract commencing with the period in 
which service is initially furnished and continuing for the term of this 
contract. Any minimum monthly charge specified in this contract shall be 
equitably prorated for the periods in

[[Page 279]]

which commencement and termination of this contract become effective.

                             (End of clause)

[59 FR 67023, Dec. 28, 1994]



Sec.  52.241-4  Change in Class of Service.

    As prescribed in 41.501(c)(3), insert a clause substantially the 
same as the following:

                  Change in Class of Service (FEB 1995)

    (a) In the event of a change in the class of service, such service 
shall be provided at the Contractor's lowest available rate schedule 
applicable to the class of service furnished.
    (b) Where the Contractor does not have on file with the regulatory 
body approved rate schedules applicable to services provided, no clause 
in this contract shall preclude the parties from negotiating a rate 
schedule applicable to the class of service furnished.

                             (End of clause)

[59 FR 67023, Dec. 28, 1994]



Sec.  52.241-5  Contractor's Facilities.

    As prescribed in 41.501(c)(4), insert a clause substantially the 
same as the following:

                   Contractor's Facilities (FEB 1995)

    (a) The Contractor, at its expense, unless otherwise provided for in 
this contract, shall furnish, install, operate, and maintain all 
facilities required to furnish service hereunder, and measure such 
service at the point of delivery specified in the Service 
Specifications. Title to all such facilities shall remain with the 
Contractor and the Contractor shall be responsible for loss or damage to 
such facilities, except that the Government shall be responsible to the 
extent that loss or damage has been caused by the Government's negligent 
acts or omissions.
    (b) Notwithstanding any terms expressed in this clause, the 
Contractor shall obtain approval from the Contracting Officer prior to 
any equipment installation, construction, or removal. The Government 
hereby grants to the Contractor, free of any rental or similar charge, 
but subject to the limitations specified in this contract, a revocable 
permit or license to enter the service location for any proper purpose 
under this contract. This permit or license includes use of the site or 
sites agreed upon by the parties hereto for the installation, operation, 
maintenance, and repair of the facilities of the Contractor required to 
be located upon Government premises. All applicable taxes and other 
charges in connection therewith, together with all liability of the 
Contractor in construction, operation, maintenance and repair of such 
facilities, shall be the obligation of the Contractor.
    (c) Authorized representatives of the Contractor will be allowed 
access to the facilities on Government premises at reasonable times to 
perform the obligations of the Contractor regarding such facilities. It 
is expressly understood that the Government may limit or restrict the 
right of access herein granted in any manner considered necessary (e.g., 
national security, public safety).
    (d) Unless otherwise specified in this contract, the Contractor 
shall, at its expense, remove such facilities and restore Government 
premises to their original condition as near as practicable within a 
reasonable time after the Government terminates this contract. In the 
event such termination of this contract is due to the fault of the 
Contractor, such facilities may be retained in place at the option of 
the Government for a reasonable time while the Government attempts to 
obtain service elsewhere comparable to that provided for hereunder.

                             (End of clause)

[59 FR 67023, Dec. 28, 1994]



Sec.  52.241-6  Service Provisions.

    As prescribed in 41.501(c)(5), insert a clause substantially the 
same as the following:

                      Service Provisions (FEB 1995)

    (a) Measurement of service. (1) All service furnished by the 
Contractor shall be measured by suitable metering equipment of standard 
manufacture, to be furnished, installed, maintained, repaired, 
calibrated, and read by the Contractor at its expense. When more than a 
single meter is installed at a service location, the readings thereof 
may be billed conjunctively, if appropriate. In the event any meter 
fails to register (or registers incorrectly) the service furnished, the 
parties shall agree upon the length of time of meter malfunction and the 
quantity of service delivered during such period of time. An appropriate 
adjustment shall be made to the next invoice for the purpose of 
correcting such errors. However, any meter which registers not more than 
---- percent slow or fast shall be deemed correct.
    (2) The Contractor shall read all meters at periodic intervals of 
approximately 30 days or in accordance with the policy of the cognizant 
regulatory body or applicable bylaws. All billings based on meter 
readings of less than ---- days shall be prorated accordingly.
    (b) Meter test. (1) The Contractor, at its expense, shall 
periodically inspect and test Contractor-installed meters at intervals 
not

[[Page 280]]

exceeding ---- year(s). The Government has the right to have 
representation during the inspection and test.
    (2) At the written request of the Contracting Officer, the 
Contractor shall make additional tests of any or all such meters in the 
presence of Government representatives. The cost of such additional 
tests shall be borne by the Government if the percentage of errors is 
found to be not more than ---- percent slow or fast.
    (3) No meter shall be placed in service or allowed to remain in 
service which has an error in registration in excess of ---- percent 
under normal operating conditions.
    (c) Change in volume or character. Reasonable notice shall be given 
by the Contracting Officer to the Contractor regarding any material 
changes anticipated in the volume or characteristics of the utility 
service required at each location.
    (d) Continuity of service and consumption. The Contractor shall use 
reasonable diligence to provide a regular and uninterrupted supply of 
service at each service location, but shall not be liable for damages, 
breach of contract or otherwise, to the Government for failure, 
suspension, diminution, or other variations of service occasioned by or 
in consequence of any cause beyond the control of the Contractor, 
including but not limited to acts of God or of the public enemy, fires, 
floods, earthquakes, or other catastrophe, strikes, or failure or 
breakdown of transmission or other facilities. If any such failure, 
suspension, diminution, or other variation of service shall aggregate 
more than ---- hour(s) during any billing period hereunder, an equitable 
adjustment shall be made in the monthly billing specified in this 
contract (including the minimum monthly charge).

                             (End of clause)

[59 FR 67024, Dec. 28, 1994; 60 FR 5870, Jan. 31, 1995]



Sec.  52.241-7  Change in Rates or Terms and Conditions of Service for Regulated Services.

    As prescribed in 41.501(d)(1), insert a clause substantially the 
same as the following:

    Change in Rates or Terms and Conditions of Service for Regulated 
                           Services (FEB 1995)

    (a) This clause applies to the extent services furnished under this 
contract are subject to regulation by a regulatory body. The Contractor 
agrees to give *-------------------- written notice of (1) the filing of 
an application for change in rates or terms and conditions of service 
concurrently with the filing of the application and (2) any changes 
pending with the regulatory body as of the date of contract award. Such 
notice shall fully describe the proposed change. If, during the term of 
this contract, the regulatory body having jurisdiction approves any 
changes, the Contractor shall forward to the Contracting Officer a copy 
of such changes within 15 days after the effective date thereof. The 
Contractor agrees to continue furnishing service under this contract in 
accordance with the amended tariff, and the Government agrees to pay for 
such service at the higher or lower rates as of the date when such rates 
are made effective.
    (b) The Contractor agrees that throughout the life of this contract 
the applicable published and unpublished rate schedule(s) shall not be 
in excess of the lowest cost published and unpublished rate schedule(s) 
available to any other customers of the same class under similar 
conditions of use and service.
    (c) In the event that the regulatory body promulgates any regulation 
concerning matters other than rates which affects this contract, the 
Contractor shall immediately provide a copy to the Contracting Officer. 
The Government shall not be bound to accept any new regulation 
inconsistent with Federal laws or regulations.
    (d) Any changes to rates or terms and conditions of service shall be 
made a part of this contract by the issuance of a contract modification 
unless otherwise specified in the contract. The effective date of the 
change shall be the effective date by the regulatory body. Any factors 
not governed by the regulatory body will have an effective date as 
agreed to by the parties.

                             (End of clause)

    *Note: Insert language prescribed in 41.501(d)(1).

[59 FR 67024, Dec. 28, 1994]



Sec.  52.241-8  Change in Rates or Terms and Conditions of Service for 
Unregulated Services.

    As prescribed in 41.501(d)(2), insert a clause substantially the 
same as the following:

   Change in Rates or Terms and Conditions of Service for Unregulated 
                           Services (FEB 1995)

    (a) This clause applies to the extent that services furnished 
hereunder are not subject to regulation by a regulatory body.
    (b) After -------------------- [insert date], either party may 
request a change in rates or terms and conditions of service, unless 
otherwise provided in this contract. Both parties agree to enter in 
negotiations concerning such changes upon receipt of a written request 
detailing the proposed changes

[[Page 281]]

and specifying the reasons for the proposed changes.
    (c) The effective date of any change shall be as agreed to by the 
parties. The Contractor agrees that throughout the life of this contract 
the rates so negotiated will not be in excess of published and 
unpublished rates charged to any other customer of the same class under 
similar terms and conditions of use and service.
    (d) The failure of the parties to agree upon any change after a 
reasonable period of time shall be a dispute under the Disputes clause 
of this contract.
    (e) Any changes to rates, terms, or conditions as a result of such 
negotiations shall be made a part of this contract by the issuance of a 
contract modification.

                             (End of clause)

[59 FR 67024, Dec. 28, 1994]



Sec.  52.241-9  Connection Charge.

    As prescribed in 41.501(d)(3), insert a clause substantially the 
same as the following:

                      Connection Charge (FEB 1995)

    (a) Charge. In consideration of the Contractor furnishing and 
installing at its expense the new connection facilities described 
herein, the Government shall pay the Contractor a connection charge. The 
payment shall be in the form of progress payments, advance payments or 
as a lump sum, as agreed to by the parties and as permitted by 
applicable law. The total amount payable shall be either the estimated 
cost of $------ less the agreed to salvage value of $------, or the 
actual cost less the salvage value, whichever is less. As a condition 
precedent to final payment, the Contractor shall execute a release of 
any claims against the Government arising under or by the virtue of such 
installation.
    (b) Ownership, operation, maintenance and repair of new facilities 
to be provided. The facilities to be supplied by the Contractor under 
this clause, notwithstanding the payment by the Government of a 
connection charge, shall be and remain the property of the Contractor 
and shall, at all times during the life of this contract or any renewals 
thereof, be operated, maintained, and repaired by the Contractor at its 
expense. All taxes and other charges in connection therewith, together 
with all liability arising out of the construction, operations, 
maintenance, or repair of such facilities, shall be the obligation of 
the Contractor.
    (c) Credits. (1) The Contractor agrees to allow the Government, on 
each monthly bill for service furnished under this contract to the 
service location, a credit of -------- percent of the amount of each 
such bill as rendered until the accumulation of credits shall equal the 
amount of such connection charge, provided that the Contractor may at 
any time allow a credit up to 100 percent of the amount of each such 
bill.
    (2) In the event the Contractor, before any termination of this 
contract but after completion of the facilities provided for in this 
clause, serves any customer other than the Government (regardless of 
whether the Government is being served simultaneously, intermittently, 
or not at all) by means of these facilities, the Contractor shall 
promptly notify the Government in writing. Unless otherwise agreed by 
the parties in writing at that time, the Contractor shall promptly 
accelerate the credits provided for under subparagraph (c)(1) of this 
clause, up to 100 percent of each monthly bill until there is refunded 
the amount that reflects the Government's connection costs for that 
portion of the facilities used in serving others.
    (3) In the event the Contractor terminates this contract, or 
defaults in performance, prior to full credit of any connection charge 
paid by the Government, the Contractor shall pay to the Government an 
amount equal to the uncredited balance of the connection charge as of 
the date of the termination or default.
    (d) Termination before completion of facilities. The Government 
reserves the right to terminate this contract at any time before 
completion of the facilities with respect to which the Government is to 
pay a connection charge. In the event the Government exercises this 
right, the Contractor shall be paid the cost of any work accomplished, 
including direct and indirect costs reasonably allocable to the 
completed work prior to the time of termination by the Government, plus 
the cost of removal, less the salvage value.
    (e) Termination after completion of facilities. In the event the 
Government terminates this contract after completion of the facilities 
with respect to which the Government has paid a connection charge, but 
before the crediting in full by the Contractor of any connection charge 
in accordance with the terms of this contract, the Contractor shall have 
the following options:
    (1) To retain in place for -------- months after the notice of 
termination by the Government such facilities on condition that--
    (i) If, during such -------- month period, the Contractor serves any 
other customer by means of such facilities, the Contractor, shall, in 
lieu of allowing credits, pay the Government during such period 
installments in like amount, manner, and extent as the credit provided 
for under paragraph (c) of this clause before such termination; and
    (ii) Immediately after such -------- month period the Contractor 
shall promptly pay in full to the Government the uncredited balance of 
the connection charge.

[[Page 282]]

    (2) To remove such facilities at the Contractor's own expense within 
-------- months after the effective date of the termination by the 
Government. If the Contractor elects to remove such facilities, the 
Government shall then have the option of purchasing such facilities at 
the agreed salvage value set forth herein; and provided further, that 
the Contractor shall, at the direction of the Government, leave in place 
such facilities located on Government property which the Government 
elects to purchase at the agreed salvage value.

                             (End of clause)

    Alternate I (NOV 1994). If the Contracting Officer determines that a 
nonrefundable charge is to be paid and no credits are due the 
Government, delete paragraphs (c) and (e), renumber paragraph (d) as (c) 
and add the following as paragraph (d):

    (d) Termination after completion of facilities. In the event the 
Government terminates this contract after completion of the facilities 
with respect to which the Government is to pay a connection charge, the 
Contractor shall have the following options:
    (1) To retain in place for -------- months after the notice of 
termination by the Government. If the Contractor and the Government have 
not agreed on terms for retention in place beyond -------- months, then 
the Contractor must remove the facilities pursuant to the terms of 
subparagraph (d)(2) of this clause.
    (2) To remove such facilities at the Contractor's own expense within 
-------- months after the effective date of the termination by the 
Government. If the Contractor elects to remove such facilities, the 
Government shall then have the option of purchasing such facilities at 
the agreed salvage value set forth herein; and provided further, that 
the Contractor shall, at the direction of the Government, leave in place 
such facilities located on Government property which the Government 
elects to purchase at the agreed salvage value.

[59 FR 67024, Dec. 28, 1994]



Sec.  52.241-10  Termination Liability.

    As prescribed in 41.501(d)(4), insert a clause substantially the 
same as the following:

                    Termination Liability (FEB 1995)

    (a) If the Government discontinues utility service under this 
contract before completion of the facilities cost recovery period 
specified in paragraph (b) of this clause, in consideration of the 
Contractor furnishing and installing at its expense, the new facility 
described herein, the Government shall pay termination charges, 
calculated as set forth in this clause.
    (b) Facility cost recovery period. The period of time, not exceeding 
the term of this contract, during which the net cost of the new 
facility, shall be recovered by the Contractor is--
    -------- months. [Insert negotiated duration.]
    (c) Net facility cost. The cost of the new facility, less the agreed 
upon salvage value of such facility, is--
    $--------. [Insert appropriate dollar amount.]
    (d) Monthly facility cost recovery rate. The monthly facility cost 
recovery rate which the Government shall pay the Contractor whether or 
not service is received is--
    $--------. [Divide the net facility cost in paragraph (c) of this 
clause by the facility's cost recovery period in paragraph (b) of this 
clause and insert the resultant figure.]
    (e) Termination charges. Termination charges = $[Multiply the 
remaining months of the facility's cost recovery period specified in 
paragraph (b) of this clause by the monthly facility cost recovery rate 
in paragraph (d) of this clause and insert the resultant figure.]
    (f) If the Contractor has recovered its capital costs at the time of 
termination there will be no termination liability charge.

                             (End of clause)

[59 FR 67025, Dec. 28, 1994]



Sec.  52.241-11  Multiple Service Locations.

    As prescribed in 41.501(d)(5), insert a clause substantially the 
same as the following:

                  Multiple Service Locations (FEB 1995)

    (a) At any time by written order, the Contracting Officer may 
designate any location within the service area of the Contractor at 
which utility service shall commence or be discontinued. Any changes to 
the service specifications shall be made a part of the contract by the 
issuance of a contract modification to include the name and location of 
the service, specifying any different rate, the point of delivery, 
different service specifications, and any other terms and conditions.
    (b) The applicable monthly charge specified in this contract shall 
be equitably prorated from the period in which commencement or 
discontinuance of service at any service location designated under the 
Service Specifications shall become effective.

                             (End of clause)

[59 FR 67025, Dec. 28, 1994]

[[Page 283]]



Sec.  52.241-12  Nonrefundable, Non[chyph]recur[chyph]ring Service Charge.

    As prescribed in 41.501(d)(6), insert a clause substantially the 
same as the following:

          Nonrefundable, Nonrecurring Service Charge (FEB 1995)

    As provided herein, the Government will pay a nonrefundable, 
nonrecurring charge when the rules and regulations of a Contractor 
require that a customer pay (1) a charge for the initiation of service, 
(2) a contribution in aid of construction, or (3) a nonrefundable 
membership fee. This charge may be in addition to or in lieu of a 
connection charge. Therefore, there is hereby added to the Contractor's 
schedule a nonrefundable, nonrecurring charge for -------- in the amount 
of $-------- dollars payable [specify dates or schedules].

                             (End of clause)

[59 FR 67025, Dec. 28, 1994]



Sec.  52.241-13  Capital Credits.

    As prescribed in 41.501(d)(7), insert a clause substantially the 
same as the following:

                       Capital Credits (FEB 1995)

    (a) The Government is a member of the -------- [insert cooperative 
name], and as any other member, is entitled to capital credits 
consistent with the bylaws of the cooperative, which states the 
obligation of the Contractor to pay capital credits and which specifies 
the method and time of payment.
    (b) The Contractor shall furnish to the Contracting Officer, or the 
designated representative of the Contracting Officer, in writing, on an 
-------- basis [insert period of time] a list of accrued credits by 
contract number, year, and delivery point.
    (c) Payment of capital credits will be made by check, payable to the 
-------- [insert agency name], and forwarded to the Contracting Officer 
at -------- [insert agency address], unless otherwise directed in 
writing by the Contracting Officer. Checks shall cite the current or 
last contract number and indicate whether the check is partial or final 
payment for all capital credits accrued.

                             (End of clause)

[59 FR 67025, Dec. 28, 1994]



Sec.  52.242-1  Notice of Intent to Disallow Costs.

    As prescribed in 42.802, insert the following clause in 
solicitations and contracts when a cost-reimbursement contract, a fixed-
price incentive contract, or a contract providing for price 
redetermination is contemplated:

              Notice of Intent to Disallow Costs (APR 1984)

    (a) Notwithstanding any other clause of this contract--
    (1) The Contracting Officer may at any time issue to the Contractor 
a written notice of intent to disallow specified costs incurred or 
planned for incurrence under this contract that have been determined not 
to be allowable under the contract terms; and
    (2) The Contractor may, after receiving a notice under subparagraph 
(1) above, submit a written response to the Contracting Officer, with 
justification for allowance of the costs. If the Contractor does respond 
within 60 days, the Contracting Officer shall, within 60 days of 
receiving the response, either make a written withdrawal of the notice 
or issue a written decision.
    (b) Failure to issue a notice under this Notice of Intent to 
Disallow Costs clause shall not affect the Government's rights to take 
exception to incurred costs.

                             (End of clause)



Sec.  52.242-2  Production Progress Reports.

    As prescribed in 42.1107(a), insert the following clause;

                 Production Progress Reports (APR 1991)

    (a) The Contractor shall prepare and submit to the Contracting 
Officer the production progress reports specified in the contract 
Schedule.
    (b) During any delay in furnishing a production progress report 
required under this contract, the Contracting Officer may withhold from 
payment an amount not exceeding $25,000 or 5 percent of the amount of 
this contract, whichever is less.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 56 FR 15156, Apr. 15, 1991]



Sec.  52.242-3  Penalties for Unallowable Costs.

    As prescribed in 42.709-6, use the following clause:

               Penalties for Unallowable Costs (MAY 2001)

    (a) Definition. Proposal, as used in this clause, means either--
    (1) A final indirect cost rate proposal submitted by the Contractor 
after the expiration of its fiscal year which--

[[Page 284]]

    (i) Relates to any payment made on the basis of billing rates; or
    (ii) Will be used in negotiating the final contract price; or
    (2) The final statement of costs incurred and estimated to be 
incurred under the Incentive Price Revision clause (if applicable), 
which is used to establish the final contract price.
    (b) Contractors which include unallowable indirect costs in a 
proposal may be subject to penalties. The penalties are prescribed in 10 
U.S.C. 2324 or 41 U.S.C. 256, as applicable, which is implemented in 
section 42.709 of the Federal Acquisition Regulation (FAR).
    (c) The Contractor shall not include in any proposal any cost that 
is unallowable, as defined in Subpart 2.1 of the FAR, or an executive 
agency supplement to the FAR.
    (d) If the Contracting Officer determines that a cost submitted by 
the Contractor in its proposal is expressly unallowable under a cost 
principle in the FAR, or an executive agency supplement to the FAR, that 
defines the allowability of specific selected costs, the Contractor 
shall be assessed a penalty equal to--
    (1) The amount of the disallowed cost allocated to this contract; 
plus
    (2) Simple interest, to be computed--
    (i) On the amount the Contractor was paid (whether as a progress or 
billing payment) in excess of the amount to which the Contractor was 
entitled; and
    (ii) Using the applicable rate effective for each six-month interval 
prescribed by the Secretary of the Treasury pursuant to Pub. L. 92-41 
(85 Stat. 97).
    (e) If the Contracting Officer determines that a cost submitted by 
the Contractor in its proposal includes a cost previously determined to 
be unallowable for that Contractor, then the Contractor will be assessed 
a penalty in an amount equal to two times the amount of the disallowed 
cost allocated to this contract.
    (f) Determinations under paragraphs (d) and (e) of this clause are 
final decisions within the meaning of the Contract Disputes Act of 1978 
(41 U.S.C. 601, et seq.).
    (g) Pursuant to the criteria in FAR 42.709-5, the Contracting 
Officer may waive the penalties in paragraph (d) or (e) of this clause.
    (h) Payment by the Contractor of any penalty assessed under this 
clause does not constitute repayment to the Government of any 
unallowable cost which has been paid by the Government to the 
Contractor.

                             (End of clause)

[60 FR 42659, Aug. 16, 1995, as amended at 66 FR 2135, Jan. 10, 2001]



Sec.  52.242-4  Certification of Final Indirect Costs.

    As prescribed in 42.703-2(f), insert the following clause:

            Certification of Final Indirect Costs (JAN 1997)

    (a) The Contractor shall--
    (1) Certify any proposal to establish or modify final indirect cost 
rates;
    (2) Use the format in paragraph (c) of this clause to certify; and
    (3) Have the certificate signed by an individual of the Contractor's 
organization at a level no lower than a vice president or chief 
financial officer of the business segment of the Contractor that submits 
the proposal.
    (b) Failure by the Contractor to submit a signed certificate, as 
described in this clause, may result in final indirect costs at rates 
unilaterally established by the Contracting Officer.
    (c) The certificate of final indirect costs shall read as follows:

                   Certificate of Final Indirect Costs

    This is to certify that I have reviewed this proposal to establish 
final indirect cost rates and to the best of my knowledge and belief:
    1. All costs included in this proposal (identify proposal and date) 
to establish final indirect cost rates for (identify period covered by 
rate) are allowable in accordance with the cost principles of the 
Federal Acquisition Regulation (FAR) and its supplements applicable to 
the contracts to which the final indirect cost rates will apply; and
    2. This proposal does not include any costs which are expressly 
unallowable under applicable cost principles of the FAR or its 
supplements.

Firm:___________________________________________________________________

Signature:______________________________________________________________

Name of Certifying Official:____________________________________________

Title:__________________________________________________________________

Date of Execution:______________________________________________________

                             (End of clause)

[60 FR 42664, Aug. 16, 1995, as amended at 62 FR 239, Jan. 2, 1997]



Sec.  52.242-5--52.242-9  [Reserved]



Sec.  52.242-10  F.o.b. Origin--Government Bills of Lading or Prepaid Postage.

    As prescribed in 42.1404-2(a), insert the following clause in 
solicitations and contracts when f.o.b origin shipments are to be made 
using Government bills of lading or prepaid postage:

[[Page 285]]

 F.o.b. Origin--Government Bills of Lading or Prepaid Postage (APR 1984)

    (a) F.o.b. origin shipments shall be made on Government bills of 
lading, or, if the supplies are mailable, via the U.S. Postal Service or 
a foreign postal system, as appropriate, with postage costs prepaid by 
the Contractor. Any direct charge for postage costs shall be listed as a 
separate item on invoices for the supplies shipped. Use of agency 
official indicia mail by Contractors is not authorized. Quantities shall 
not be divided into mailable lots for the express purpose of avoiding 
movement by other modes of transportation.
    (b) If Government bills of lading are not furnished with the 
contract or applicable ordering document, the Contractor shall obtain 
them from the Contracting Officer or designated representative.
    (c) Unless otherwise directed, the Contractor shall address overseas 
parcel post to an ultimate DOD consignee in care of a designated Army, 
Air Force, or Navy (fleet) post office and not to, or in care of, a 
transportation officer, or other activity at a CONUS water or aerial 
terminal for transshipment.

                             (End of clause)



Sec.  52.242-11  F.o.b. Origin--Government Bills of Lading or Indicia Mail.

    As prescribed in 42.1404-2(b), insert the following clause:

      F.o.b.--Government Bills of Lading or Indicia Mail (FEB 1993)

    (a) F.o.b. origin shipments shall be made on Government bills of 
lading, or, if the supplies are mailable, via the U.S. Postal System, 
using ``Penalty Permit Imprint'' indicia labels.
    (b) If Government bills of lading are not furnished with the 
contract or applicable ordering document, the Contractor shall obtain 
them from the Contracting Officer or designated representative.
    (c) Unless otherwise directed, the Contractor shall address overseas 
parcel post to an ultimate DOD consignee in care of a designated Army, 
Air Force, or Navy (fleet) post office and not to, or in care of, a 
transportation officer, or other activity at a CONUS water or aerial 
terminal for transshipment.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 57 FR 60587, Dec. 21, 1992]



Sec.  52.242-12  Report of Shipment (REPSHIP).

    As prescribed in 42.1406-2, insert the following clause:

                Report of Shipment (REPSHIP) (June 2003)

    (a) Definition. Domestic destination, as used in this clause, 
means--
    (1) A destination within the contiguous United States; or
    (2) If shipment originates in Alaska or Hawaii, a destination in 
Alaska or Hawaii, respectively.
    (b) Unless otherwise directed by the Contracting Officer, the 
Contractor shall--
    (1) Send a prepaid notice of shipment to the consignee 
transportation officer--
    (i) For all shipments of--
    (A) Classified material, protected sensitive, and protected 
controlled material;
    (B) Explosives and poisons, classes A and B;
    (C) Radioactive materials requiring the use of a III bar label; or
    (ii) When a truckload/carload shipment of supplies weighing 20,000 
pounds or more, or a shipment of less weight that occupies the full 
visible capacity of a railway car or motor vehicle, is given to any 
carrier (common, contract or private) for transportation to a domestic 
destination (other than a port for export);
    (2) Transmit the notice by rapid means to be received by the 
consignee transportation officer at least 24 hours before the arrival of 
the shipment; and
    (3) Send, to the receiving transportation officer, the Government 
bill of lading, commercial bill of lading or letter or other document 
containing the following information and prominently identified as a 
``Report of Shipment'' or ``REPSHIP FOR T.O.''

Message Example:

REPSHIP FOR T.O. 81 JUN 01
TRANSPORTATION OFFICER
DEFENSE DEPOT, MEMPHIS, TENN.
SHIPPED YOUR DEPOT 1981 JUN 1 540 CTNS MENS COTTON TROUSERS, 30,240 LB, 
1782 CUBE, VIA XX-YY*
IN CAR NO. XX 123456**-GBL***-C98000031**** CONTRACT DLA ------ 
ETA*****-JUNE 5 JONES & CO., JERSEY CITY, N.J.

* Name of rail carrier, trucker, or other carrier.
** Vehicle identification.
*** Government bill of lading.
**** If not shipped by GBL, identify lading document and state whether 
paid by contractor.
***** Estimated time of arrival.

                             (End of clause)

[68 FR 28087, May 22, 2003]



Sec.  52.242-13  Bankruptcy.

    As prescribed in 42.903, insert the following clause:

[[Page 286]]

                          Bankruptcy (JUL 1995)

    In the event the Contractor enters into proceedings relating to 
bankruptcy, whether voluntary or involuntary, the Contractor agrees to 
furnish, by certified mail or electronic commerce method authorized by 
the contract, written notification of the bankruptcy to the Contracting 
Officer responsible for administering the contract. This notification 
shall be furnished within five days of the initiation of the proceedings 
relating to bankruptcy filing. This notification shall include the date 
on which the bankruptcy petition was filed, the identity of the court in 
which the bankruptcy petition was filed, and a listing of Government 
contract numbers and contracting offices for all Government contracts 
against which final payment has not been made. This obligation remains 
in effect until final payment under this contract.

                             (End of clause)

[56 FR 15156, Apr. 15, 1991, as amended at 60 FR 34741, July 3, 1995]



Sec.  52.242-14  Suspension of Work.

    As prescribed in 42.1305(a), insert the following clause in 
solicitations and contracts when a fixed-price construction or 
architect-engineer contract is contemplated:

                      Suspension of Work (APR 1984)

    (a) The Contracting Officer may order the Contractor, in writing, to 
suspend, delay, or interrupt all or any part of the work of this 
contract for the period of time that the Contracting Officer determines 
appropriate for the convenience of the Government.
    (b) If the performance of all or any part of the work is, for an 
unreasonable period of time, suspended, delayed, or interrupted (1) by 
an act of the Contracting Officer in the administration of this 
contract, or (2) by the Contracting Officer's failure to act within the 
time specified in this contract (or within a reasonable time if not 
specified), an adjustment shall be made for any increase in the cost of 
performance of this contract (excluding profit) necessarily caused by 
the unreasonable suspension, delay, or interruption, and the contract 
modified in writing accordingly. However, no adjustment shall be made 
under this clause for any suspension, delay, or interruption to the 
extent that performance would have been so suspended, delayed, or 
interrupted by any other cause, including the fault or negligence of the 
Contractor, or for which an equitable adjustment is provided for or 
excluded under any other term or condition of this contract.
    (c) A claim under this clause shall not be allowed (1) for any costs 
incurred more than 20 days before the Contractor shall have notified the 
Contracting Officer in writing of the act or failure to act involved 
(but this requirement shall not apply as to a claim resulting from a 
suspension order), and (2) unless the claim, in an amount stated, is 
asserted in writing as soon as practicable after the termination of the 
suspension, delay, or interruption, but not later than the date of final 
payment under the contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983. Redesignated and amended at 60 FR 48251, 
48256, Sept. 18, 1995]



Sec.  52.242-15  Stop-Work Order.

    As prescribed in 42.1305(b), insert the following clause. The 90-day 
period stated in the clause may be reduced to less than 90 days.

                       Stop-Work Order (AUG 1989)

    (a) The Contracting Officer may, at any time, by written order to 
the Contractor, require the Contractor to stop all, or any part, of the 
work called for by this contract for a period of 90 days after the order 
is delivered to the Contractor, and for any further period to which the 
parties may agree. The order shall be specifically identified as a stop-
work order issued under this clause. Upon receipt of the order, the 
Contractor shall immediately comply with its terms and take all 
reasonable steps to minimize the incurrence of costs allocable to the 
work covered by the order during the period of work stoppage. Within a 
period of 90 days after a stop-work order is delivered to the 
Contractor, or within any extension of that period to which the parties 
shall have agreed, the Contracting Officer shall either--
    (1) Cancel the stop-work order; or
    (2) Terminate the work covered by the order as provided in the 
Default, or the Termination for Convenience of the Government, clause of 
this contract.
    (b) If a stop-work order issued under this clause is canceled or the 
period of the order or any extension thereof expires, the Contractor 
shall resume work. The Contracting Officer shall make an equitable 
adjustment in the delivery schedule or contract price, or both, and the 
contract shall be modified, in writing, accordingly, if--
    (1) The stop-work order results in an increase in the time required 
for, or in the Contractor's cost properly allocable to, the performance 
of any part of this contract; and
    (2) The Contractor asserts its right to the adjustment within 30 
days after the end of the period of work stoppage; provided, that, if 
the Contracting Officer decides the facts justify the action, the 
Contracting Officer may receive and act upon a proposal submitted at

[[Page 287]]

any time before final payment under this contract.
    (c) If a stop-work order is not canceled and the work covered by the 
order is terminated for the conveninece of the Government, the 
Contracting Officer shall allow reasonable costs resulting from the 
stop-work order in arriving at the termination settlement.
    (d) If a stop-work order is not canceled and the work covered by the 
order is terminated for default, the Contracting Officer shall allow, by 
equitable adjustment or otherwise, reasonable costs resulting from the 
stop-work order.

                             (End of clause)

    Alternate I (APR 1984). If this clause is inserted in a cost-
reimbursement contract, substitute in paragraph (a)(2) the words ``the 
Termination clause of this contract'' for the words ``the Default, or 
the Termination for Convenience of the Government clause of this 
contract.'' In paragraph (b) substitute the words ``an equitable 
adjustment in the delivery schedule, the estimated cost, the fee, or a 
combination thereof, and in any other terms of the contract that may be 
affected for the words an equitable adjustment in the delivery schedule 
or contract price, or both.''

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 2272, Jan. 15, 1985; 
54 FR 29283, July 11, 1989. Redesignated and amended at 60 FR 48251, 
48256, Sept. 18, 1995]



Sec.  52.242-16  Stop-Work Order--Facilities.

    As prescribed in 42.1305(c), insert the following clause. The 90-day 
period stated in the clause may be reduced to less than 90 days.

                 Stop-Work Order--Facilities (AUG 1989)

    (a) The Contracting Officer may, at any time, by written order to 
the Contractor, require the Contractor to stop all, or any part, of the 
acquisition, construction, or installation work called for by this 
contract for a period of 90 days after the order is delivered to the 
Contractor, and for any further period to which the parties may agree. 
The order shall be specifically identified as a stop-work order issued 
under this clause. Upon receipt of the order, the Contractor shall, at 
Government expense, immediately comply with its terms and take all 
reasonable steps to minimize the incurrence of cost allocable to the 
work covered by the order during the period of work stoppage. Within a 
period of 90 days after a stop-work order is delivered to the 
Contractor, or within any extension of that period to which the parties 
shall have agreed, the Contracting Officer shall either--
    (1) Cancel the stop-work order; or
    (2) Terminate the work covered by the order as provided in the 
Termination of Work clause of this contract.
    (b) If a stop-work order issued under this clause is canceled or the 
period of the order or any extension thereof expires, the Contractor 
shall resume work. The Contracting Officer shall make an equitable 
adjustment in the delivery completion schedule, the estimated cost, or 
both, and the contract shall be modified, in writing, accordingly, if--
    (1) The stop-work order results in an increase in the time required 
for, or in the Contractor's cost properly allocable to, the performance 
of any part of this contract; and
    (2) The Contractor asserts its right to the adjustment within 30 
days after the end of the period of work stoppage; provided, that, if 
the Contracting Officer decides the facts justify the action, the 
Contracting Officer may receive and act upon a proposal submitted at any 
time before final payment under this contract.
    (c) If a stop-work order is not canceled and the work covered by the 
order is terminated, the Contracting Officer shall allow reasonable 
costs resulting from the stop-work order in arriving at the termination 
settlement.
    (d) An appropriate equitable adjustment may be made in any related 
contract of the Contractor that provides for adjustment and is affected 
by any stop-work order under this clause. The Government shall not be 
liable to the Contractor for damages or loss of profits because of a 
stop-work order issued under this clause.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 29283, July 11, 1989. 
Redesignated and amended at 60 FR 48251, 48256, Sept. 18, 1995]



Sec.  52.242-17  Government Delay of Work.

    As prescribed in 42.1305(d), insert the following clause in 
solicitations and contracts when a fixed-price contract is contemplated 
for supplies other than commercial or modified-commercial items. The 
clause use is optional when a fixed-price contract is contemplated for 
services, or for supplies that are commercial or modified-commercial 
items.

                   Government Delay of Work (APR 1984)

    (a) If the performance of all or any part of the work of this 
contract is delayed or interrupted (1) by an act of the Contracting 
Officer in the administration of this contract that is not expressly or 
impliedly authorized by this contract, or (2) by a failure of the

[[Page 288]]

Contracting Officer to act within the time specified in this contract, 
or within a reasonable time if not specified, an adjustment (excluding 
profit) shall be made for any increase in the cost of performance of 
this contract caused by the delay or interruption and the contract shall 
be modified in writing accordingly. Adjustment shall also be made in the 
delivery or performance dates and any other contractual term or 
condition affected by the delay or interruption. However, no adjustment 
shall be made under this clause for any delay or interruption to the 
extent that performance would have been delayed or interrupted by any 
other cause, including the fault or negligence of the Contractor, or for 
which an adjustment is provided or excluded under any other term or 
condition of this contract.
    (b) A claim under this clause shall not be allowed (1) for any costs 
incurred more than 20 days before the Contractor shall have notified the 
Contracting Officer in writing of the act or failure to act involved, 
and (2) unless the claim, in an amount stated, is asserted in writing as 
soon as practicable after the termination of the delay or interruption, 
but not later than the day of final payment under the contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983. Redesignated and amended at 60 FR 48251, 
48256, Sept. 18, 1995]



Sec.  52.243-1  Changes--Fixed-Price.

    As prescribed in 43.205(e), insert the following clause:

                     Changes--Fixed-Price (AUG 1987)

    (a) The Contracting Officer may at any time, by written order, and 
without notice to the sureties, if any, make changes within the general 
scope of this contract in any one or more of the following:
    (2) Drawings, designs, or specifications when the supplies to be 
furnished are to be specially manufactured for the Government in 
accordance with the drawings, designs, or specifications.
    (2) Method of shipment or packing.
    (3) Place of delivery.
    (b) If any such change causes an increase or decrease in the cost 
of, or the time required for, performance of any part of the work under 
this contract, whether or not changed by the order, the Contracting 
Officer shall make an equitable adjustment in the contract price, the 
delivery schedule, or both, and shall modify the contract.
    (c) The Contractor must assert its right to an adjustment under this 
clause within 30 days from the date of receipt of the written order. 
However, if the Contracting Officer decides that the facts justify it, 
the Contracting Officer may receive and act upon a proposal submitted 
before final payment of the contract.
    (d) If the Contractor's proposal includes the cost of property made 
obsolete or excess by the change, the Contracting Officer shall have the 
right to prescribe the manner of the disposition of the property.
    (e) Failure to agree to any adjustment shall be a dispute under the 
Disputes clause. However, nothing in this clause shall excuse the 
Contractor from proceeding with the contract as changed.

                             (End of clause)

    Alternate I (APR 1984). If the requirement is for services, other 
than architect-engineer or other professional services, and no supplies 
are to be furnished, substitute the following paragraph (a) for 
paragraph (a) of the basic clause:

    (a) The Contracting Officer may at any time, by written order, and 
without notice to the sureties, if any, make changes within the general 
scope of this contract in any one or more of the following:
    (1) Description of services to be performed.
    (2) Time of performance (i.e., hours of the day, days of the week, 
etc.).
    (3) Place of performance of the services.

    Alternate II (APR 1984). If the requirement is for services (other 
than architect-engineer services, transportation, or research and 
development) and supplies are to be furnished, substitute the following 
paragraph (a) for paragraph (a) of the basic clause:

    (a) The Contracting Officer may at any time, by written order, and 
without notice to the sureties, if any, make changes within the general 
scope of this contract in any one or more of the following:
    (1) Description of services to be performed.
    (2) Time of performance (i.e., hours of the day, days of the week, 
etc.).
    (3) Place of performance of the services.
    (4) Drawings, designs, or specifications when the supplies to be 
furnished are to be specially manufactured for the Government in 
accordance with the drawings, designs, or specifications.
    (5) Method of shipment or packing of supplies.
    (6) Place of delivery.

    Alternate III (APR 1984). If the requirement is for architect-
engineer or other professional services, substitute the following 
paragraph (a) for paragraph (a) of the basic clause and add the 
following paragraph (f):


[[Page 289]]


    (a) The Contracting Officer may at any time, by written order, and 
without notice to the sureties, if any, make changes within the general 
scope of this contract in the services to be performed.
    (f) No services for which an additional cost or fee will be charged 
by the Contractor shall be furnished without the prior written 
authorization of the Contracting Officer.

    Alternate IV (APR 1984). If the requirement is for transportation 
services, substitute the following paragraph (a) for paragraph (a) of 
the basic clause:

    (a) The Contracting Officer may at any time, by written order, and 
without notice to the sureties, if any, make changes within the general 
scope of this contract in any one or more of the following:
    (1) Specifications.
    (2) Work or services.
    (3) Place of origin.
    (4) Place of delivery.
    (5) Tonnage to be shipped.
    (6) Amount of Government-furnished property.

    Alternate V (APR 1984). If the requirement is for research and 
development and it is desired to include the clause, substitute the 
following subparagraphs (a)(1) and (a)(3) and paragraph (b) for 
subparagraphs (a)(1) and (a)(3) and paragraph (b) of the basic clause:

    (1) Drawings, designs, or specifications.
    (3) Place of inspection, delivery, or acceptance.
    (b) If any such change causes an increase or decrease in the cost 
of, or time required for, performing this contract, whether or not 
changed by the order, the Contracting Officer shall make an equitable 
adjustment in (1) the contract price, the time of performance, or both; 
and (2) other affected terms of the contract, and shall modify the 
contract accordingly.

[48 FR 42478, Sept. 19, 1983, as amended at 52 FR 30079, Aug. 12, 1987; 
54 FR 48995, Nov. 28, 1989; 60 FR 34761, July 3, 1995]



Sec.  52.243-2  Changes--Cost-Reimbursement.

    As prescribed in 43.205(b)(1), insert the following clause. The 30-
day period may be varied according to agency procedures.

                 Changes--Cost-Reimbursement (AUG 1987)

    (a) The Contracting Officer may at any time, by written order, and 
without notice to the sureties, if any, make changes within the general 
scope of this contract in any one or more of the following:
    (1) Drawings, designs, or specifications when the supplies to be 
furnished are to be specially manufactured for the Government in 
accordance with the drawings, designs, or specifications.
    (2) Method of shipment or packing.
    (3) Place of delivery.
    (b) If any such change causes an increase or decrease in the 
estimated cost of, or the time required for, performance of any part of 
the work under this contract, whether or not changed by the order, or 
otherwise affects any other terms and conditions of this contract, the 
Contracting Officer shall make an equitable adjustment in the (1) 
estimated cost, delivery or completion schedule, or both; (2) amount of 
any fixed fee; and (3) other affected terms and shall modify the 
contract accordingly.
    (c) The Contractor must assert its right to an adjustment under this 
clause within 30 days from the date of receipt of the written order. 
However, if the Contracting Officer decides that the facts justify it, 
the Contracting Officer may receive and act upon a proposal submitted 
before final payment of the contract.
    (d) Failure to agree to any adjustment shall be a dispute under the 
Disputes clause. However, nothing in this clause shall excuse the 
Contractor from proceeding with the contract as changed.
    (e) Notwithstanding the terms and conditions of paragraphs (a) and 
(b) above, the estimated cost of this contract and, if this contract is 
incrementally funded, the funds allotted for the performance of this 
contract, shall not be increased or considered to be increased except by 
specific written modification of the contract indicating the new 
contract estimated cost and, if this contract is incrementally funded, 
the new amount allotted to the contract. Until this modification is 
made, the Contractor shall not be obligated to continue performance or 
incur costs beyond the point established in the Limitation of Cost or 
Limitation of Funds clause of this contract.

                             (End of clause)

    Alternate I (APR 1984). If the requirement is for services and no 
supplies are to be furnished, substitute the following paragraph (a) for 
paragraph (a) of the basic clause:

    (a) The Contracting Officer may at any time, by written order, and 
without notice to the sureties, if any, make changes within the general 
scope of this contract in any one or more of the following:
    (1) Description of services to be performed.
    (2) Time of performance (i.e., hours of the day, days of the week, 
etc.).

[[Page 290]]

    (3) Place of performance of the services.

    Alternate II (APR 1984). If the requirement is for services and 
supplies are to be furnished, substitute the following paragraph (a) for 
paragraph (a) of the basic clause:

    (a) The Contracting Officer may at any time, by written order, and 
without notice to the sureties, if any, make changes within the general 
scope of this contract in any one or more of the following:
    (1) Description of services to be performed.
    (2) Time of performance (i.e., hours of the day, days of the week, 
etc.).
    (3) Place of performance of the services.
    (4) Drawings, designs, or specifications when the supplies to be 
furnished are to be specially manufactured for the Government in 
accordance with the drawings, designs, or specifications.
    (5) Method of shipment or packing of supplies.
    (6) Place of delivery.

    Alternate III (APR 1984). If the requirement is for construction, 
substitute the following paragraph (a) for paragraph (a) of the basic 
clause:

    (a) The Contracting Officer may at any time, by written order, and 
without notice to the sureties, if any, make changes within the general 
scope of this contract in the plans and specifications or instructions 
incorporated in the contract.

    Alternate IV (APR 1984). If a facilities contract is contemplated, 
substitute the following paragraphs (a) and (e) for paragraphs (a) and 
(e) of the basic clause:

    (a) The Contracting Officer may at any time, by written order, and 
without notice to the sureties, if any, make changes within the general 
scope of this contract in the facilities or work described in the 
schedule.
    (e) Any related contract with the Contractor may be equitably 
adjusted if it provides for adjustment and is affected by a change 
ordered under this clause.

    Alternate V (APR 1984). If the requirement is for research and 
development, and it is desired to include the clause, substitute the 
following subparagraphs (a)(1) and (a)(3) for subparagraphs (a)(1) and 
(a)(3) of the basic clause:

    (1) Drawings, designs, or specifications.
    (3) Place of inspection, delivery, or acceptance.

[48 FR 42478, Sept. 19, 1983, as amended at 52 FR 30079, Aug. 12, 1987]



Sec.  52.243-3  Changes--Time-and-Materials or Labor-Hours.

    As prescribed in 43.205(c), insert the following clause:

          Changes--Time-and-Materials or Labor-Hours (SEP 2000)

    (a) The Contracting Officer may at any time, by written order, and 
without notice to the sureties, if any, make changes within the general 
scope of this contract in any one or more of the following:
    (1) Description of services to be performed.
    (2) Time of performance (i.e., hours of the day, days of the week, 
etc.).
    (3) Place of performance of the services.
    (4) Drawings, designs, or specifications when the supplies to be 
furnished are to be specially manufactured for the Government in 
accordance with the drawings, designs, or specifications.
    (5) Method of shipment or packing of supplies.
    (6) Place of delivery.
    (7) Amount of Government-furnished property.
    (b) If any change causes an increase or decrease in any hourly rate, 
the ceiling price, or the time required for performance of any part of 
the work under this contract, whether or not changed by the order, or 
otherwise affects any other terms and conditions of this contract, the 
Contracting Officer will make an equitable adjustment in any one or more 
of the following and will modify the contract accordingly:
    (1) Ceiling price.
    (2) Hourly rates.
    (3) Delivery schedule.
    (4) Other affected terms.
    (c) The Contractor shall assert its right to an adjustment under 
this clause within 30 days from the date of receipt of the written 
order. However, if the Contracting Officer decides that the facts 
justify it, the Contracting Officer may receive and act upon a proposal 
submitted before final payment of the contract.
    (d) Failure to agree to any adjustment will be a dispute under the 
Disputes clause. However, nothing in this clause excuses the Contractor 
from proceeding with the contract as changed.

                             (End of clause)

[65 FR 46073, July 26, 2000]



Sec.  52.243-4  Changes.

    As prescribed in 43.205(d), insert the following clause. The 30-day 
period may be varied according to agency procedures.

[[Page 291]]

                           Changes (AUG 1987)

    (a) The Contracting Officer may, at any time, without notice to the 
sureties, if any, by written order designated or indicated to be a 
change order, make changes in the work within the general scope of the 
contract, including changes--
    (1) In the specifications (including drawings and designs);
    (2) In the method or manner of performance of the work;
    (3) In the Government-furnished facilities, equipment, materials, 
services, or site; or
    (4) Directing acceleration in the performance of the work.
    (b) Any other written or oral order (which, as used in this 
paragraph (b), includes direction, instruction, interpretation, or 
determination) from the Contracting Officer that causes a change shall 
be treated as a change order under this clause; provided, that the 
Contractor gives the Contracting Officer written notice stating (1) the 
date, circumstances, and source of the order and (2) that the Contractor 
regards the order as a change order.
    (c) Except as provided in this clause, no order, statement, or 
conduct of the Contracting Officer shall be treated as a change under 
this clause or entitle the Contractor to an equitable adjustment.
    (d) If any change under this clause causes an increase or decrease 
in the Contractor's cost of, or the time required for, the performance 
of any part of the work under this contract, whether or not changed by 
any such order, the Contracting Officer shall make an equitable 
adjustment and modify the contract in writing. However, except for an 
adjustment based on defective specifications, no adjustment for any 
change under paragraph (b) of this clause shall be made for any costs 
incurred more than 20 days before the Contractor gives written notice as 
required. In the case of defective specifications for which the 
Government is responsible, the equitable adjustment shall include any 
increased cost reasonably incurred by the Contractor in attempting to 
comply with the defective specifications.
    (e) The Contractor must assert its right to an adjustment under this 
clause within 30 days after (1) receipt of a written change order under 
paragraph (a) of this clause or (2) the furnishing of a written notice 
under paragraph (b) of this clause, by submitting to the Contracting 
Officer a written statement describing the general nature and amount of 
proposal, unless this period is extended by the Government. The 
statement of proposal for adjustment may be included in the notice under 
paragraph (b) above.
    (f) No proposal by the Contractor for an equitable adjustment shall 
be allowed if asserted after final payment under this contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 52 FR 30079, Aug. 12, 1987]



Sec.  52.243-5  Changes and Changed Conditions.

    As prescribed in 43.205(e), insert the following clause:

                Changes and Changed Conditions (APR 1984)

    (a) The Contracting Officer may, in writing, order changes in the 
drawings and specifications within the general scope of the contract.
    (b) The Contractor shall promptly notify the Contracting Officer, in 
writing, of subsurface or latent physical conditions differing 
materially from those indicated in this contract or unknown unusual 
physical conditions at the site before proceeding with the work.
    (c) If changes under paragraph (a) or conditions under paragraph (b) 
increase or decrease the cost of, or time required for performing the 
work, the Contracting Officer shall make an equitable adjustment (see 
paragraph (d)) upon submittal of a proposal for adjustment (hereafter 
referred to as proposal) by the Contractor before final payment under 
the contract.
    (d) The Contracting Officer shall not make an equitable adjustment 
under paragraph (b) unless--
    (1) The Contractor has submitted and the Contracting Officer has 
received the required written notice; or
    (2) The Contracting Officer waives the requirement for the written 
notice.
    (e) Failure to agree to any adjustment shall be a dispute under the 
Disputes clause.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34761, July 3, 1995]



Sec.  52.243-6  Change Order Accounting.

    As prescribed in 43.205(f), the contracting officer may insert a 
clause, substantially the same as follows:

                   Change Order Accounting (APR 1984)

    The Contracting Officer may require change order accounting whenever 
the estimated cost of a change or series of related changes exceeds 
$100,000. The Contractor, for each change or series of related changes, 
shall maintain separate accounts, by job order or other suitable 
accounting procedure, of all incurred segregable, direct costs (less 
allocable credits) of work, both changed and not changed, allocable to 
the change.

[[Page 292]]

The Contractor shall maintain such accounts until the parties agree to 
an equitable adjustment for the changes ordered by the Contracting 
Officer or the matter is conclusively disposed of in accordance with the 
Disputes clause.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 29297, July 11, 1989; 
56 FR 15156, Apr. 15, 1991]



Sec.  52.243-7  Notification of Changes.

    As prescribed in 43.107, the contracting officer may insert a clause 
substantially the same as the following in solicitations and contracts. 
The clause is available for use primarily in negotiated research and 
development or supply contracts for the acquisition of major weapon 
systems or principal subsystems. If the contract amount is expected to 
be less than $1,000,000, the clause shall not be used, unless the 
contracting officer anticipates that situations will arise that may 
result in a contractor alleging that the Government has effected changes 
other than those identified as such in writing and signed by the 
contracting officer.

                   Notification of Changes (APR 1984)

    (a) Definitions.
    Contracting Officer, as used in this clause, does not include any 
representative of the Contracting Officer.
    Specifically Authorized Representative (SAR), as used in this 
clause, means any person the Contracting Officer has so designated by 
written notice (a copy of which shall be provided to the Contractor) 
which shall refer to this subparagraph and shall be issued to the 
designated representative before the SAR exercises such authority.
    (b) Notice. The primary purpose of this clause is to obtain prompt 
reporting of Government conduct that the Contractor considers to 
constitute a change to this contract. Except for changes identified as 
such in writing and signed by the Contracting Officer, the Contractor 
shall notify the Administrative Contracting Officer in writing promptly, 
within -- (to be negotiated) calendar days from the date that the 
Contractor identifies any Government conduct (including actions, 
inactions, and written or oral communications) that the Contractor 
regards as a change to the contract terms and conditions. On the basis 
of the most accurate information available to the Contractor, the notice 
shall state--
    (1) The date, nature, and circumstances of the conduct regarded as a 
change;
    (2) The name, function, and activity of each Government individual 
and Contractor official or employee involved in or knowledgeable about 
such conduct;
    (3) The identification of any documents and the substance of any 
oral communication involved in such conduct;
    (4) In the instance of alleged acceleration of scheduled performance 
or delivery, the basis upon which it arose;
    (5) The particular elements of contract performance for which the 
Contractor may seek an equitable adjustment under this clause, 
including--
    (i) What contract line items have been or may be affected by the 
alleged change;
    (ii) What labor or materials or both have been or may be added, 
deleted, or wasted by the alleged change;
    (iii) To the extent practicable, what delay and disruption in the 
manner and sequence of performance and effect on continued performance 
have been or may be caused by the alleged change;
    (iv) What adjustments to contract price, delivery schedule, and 
other provisions affected by the alleged change are estimated; and
    (6) The Contractor's estimate of the time by which the Government 
must respond to the Contractor's notice to minimize cost, delay or 
disruption of performance.
    (c) Continued performance. Following submission of the notice 
required by (b) above, the Contractor shall diligently continue 
performance of this contract to the maximum extent possible in 
accordance with its terms and conditions as construed by the Contractor, 
unless the notice reports a direction of the Contracting Officer or a 
communication from a SAR of the Contracting Officer, in either of which 
events the Contractor shall continue performance; provided, however, 
that if the Contractor regards the direction or communication as a 
change as described in (b) above, notice shall be given in the manner 
provided. All directions, communications, interpretations, orders and 
similar actions of the SAR shall be reduced to writing promptly and 
copies furnished to the Contractor and to the Contracting Officer. The 
Contracting Officer shall promptly countermand any action which exceeds 
the authority of the SAR.
    (d) Government response. The Contracting Officer shall promptly, 
within -- (to be negotiated) calendar days after receipt of notice, 
respond to the notice in writing. In responding, the Contracting Officer 
shall either--
    (1) Confirm that the conduct of which the Contractor gave notice 
constitutes a change and when necessary direct the mode of further 
performance;
    (2) Countermand any communication regarded as a change;
    (3) Deny that the conduct of which the Contractor gave notice 
constitutes a change

[[Page 293]]

and when necessary direct the mode of further performance; or
    (4) In the event the Contractor's notice information is inadequate 
to make a decision under (1), (2), or (3) above, advise the Contractor 
what additional information is required, and establish the date by which 
it should be furnished and the date thereafter by which the Government 
will respond.
    (e) Equitable adjustments. (1) If the Contracting Officer confirms 
that Government conduct effected a change as alleged by the Contractor, 
and the conduct causes an increase or decrease in the Contractor's cost 
of, or the time required for, performance of any part of the work under 
this contract, whether changed or not changed by such conduct, an 
equitable adjustment shall be made--
    (i) In the contract price or delivery schedule or both; and
    (ii) In such other provisions of the contract as may be affected.
    (2) The contract shall be modified in writing accordingly. In the 
case of drawings, designs or specifications which are defective and for 
which the Government is responsible, the equitable adjustment shall 
include the cost and time extension for delay reasonably incurred by the 
Contractor in attempting to comply with the defective drawings, designs 
or specifications before the Contractor identified, or reasonably should 
have identified, such defect. When the cost of property made obsolete or 
excess as a result of a change confirmed by the Contracting Officer 
under this clause is included in the equitable adjustment, the 
Contracting Officer shall have the right to prescribe the manner of 
disposition of the property. The equitable adjustment shall not include 
increased costs or time extensions for delay resulting from the 
Contractor's failure to provide notice or to continue performance as 
provided, respectively, in (b) and (c) above.
    Note: The phrases contract price and cost wherever they appear in 
the clause, may be appropriately modified to apply to cost-reimbursement 
or incentive contracts, or to combinations thereof.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 25534, June 21, 1990; 
55 FR 38518, Sept. 18, 1990]



Sec.  52.244-1  [Reserved]



Sec.  52.244-2  Subcontracts.

    As prescribed in 44.204(a)(1), insert the following clause:

                         Subcontracts (AUG 1998)

    (a) Definitions. As used in this clause--
    Approved purchasing system means a Contractor's purchasing system 
that has been reviewed and approved in accordance with Part 44 of the 
Federal Acquisition Regulation (FAR).
    Consent to subcontract means the Contracting Officer's written 
consent for the Contractor to enter into a particular subcontract.
    Subcontract means any contract, as defined in FAR Subpart 2.1, 
entered into by a subcontractor to furnish supplies or services for 
performance of the prime contract or a subcontract. It includes, but is 
not limited to, purchase orders, and changes and modifications to 
purchase orders.
    (b) This clause does not apply to subcontracts for special test 
equipment when the contract contains the clause at FAR 52.245-18, 
Special Test Equipment.
    (c) When this clause is included in a fixed-price type contract, 
consent to subcontract is required only on unpriced contract actions 
(including unpriced modifications or unpriced delivery orders), and only 
if required in accordance with paragraph (d) or (e) of this clause.
    (d) If the Contractor does not have an approved purchasing system, 
consent to subcontract is required for any subcontract that--
    (1) Is of the cost-reimbursement, time-and-materials, or labor-hour 
type; or
    (2) Is fixed-price and exceeds--
    (i) For a contract awarded by the Department of Defense, the Coast 
Guard, or the National Aeronautics and Space Administration, the greater 
of the simplified acquisition threshold or 5 percent of the total 
estimated cost of the contract; or
    (ii) For a contract awarded by a civilian agency other than the 
Coast Guard and the National Aeronautics and Space Administration, 
either the simplified acquisition threshold or 5 percent of the total 
estimated cost of the contract.
    (e) If the Contractor has an approved purchasing system, the 
Contractor nevertheless shall obtain the Contracting Officer's written 
consent before placing the following subcontracts:

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

    (f)(1) The Contractor shall notify the Contracting Officer 
reasonably in advance of placing any subcontract or modification thereof 
for which consent is required under paragraph (c), (d), or (e) of this 
clause, including the following information:
    (i) A description of the supplies or services to be subcontracted.
    (ii) Identification of the type of subcontract to be used.
    (iii) Identification of the proposed subcontractor.

[[Page 294]]

    (iv) The proposed subcontract price.
    (v) The subcontractor's current, complete, and accurate cost or 
pricing data and Certificate of Current Cost or Pricing Data, if 
required by other contract provisions.
    (vi) The subcontractor's Disclosure Statement or Certificate 
relating to Cost Accounting Standards when such data are required by 
other provisions of this contract.
    (vii) A negotiation memorandum reflecting--
    (A) The principal elements of the subcontract price negotiations;
    (B) The most significant considerations controlling establishment of 
initial or revised prices;
    (C) The reason cost or pricing data were or were not required;
    (D) The extent, if any, to which the Contractor did not rely on the 
subcontractor's cost or pricing data in determining the price objective 
and in negotiating the final price;
    (E) The extent to which it was recognized in the negotiation that 
the subcontractor's cost or pricing data were not accurate, complete, or 
current; the action taken by the Contractor and the subcontractor; and 
the effect of any such defective data on the total price negotiated;
    (F) The reasons for any significant difference between the 
Contractor's price objective and the price negotiated; and
    (G) A complete explanation of the incentive fee or profit plan when 
incentives are used. The explanation shall identify each critical 
performance element, management decisions used to quantify each 
incentive element, reasons for the incentives, and a summary of all 
trade-off possibilities considered.
    (2) The Contractor is not required to notify the Contracting Officer 
in advance of entering into any subcontract for which consent is not 
required under paragraph (c), (d), or (e) of this clause.
    (g) Unless the consent or approval specifically provides otherwise, 
neither consent by the Contracting Officer to any subcontract nor 
approval of the Contractor's purchasing system shall constitute a 
determination--
    (1) Of the acceptability of any subcontract terms or conditions;
    (2) Of the allowability of any cost under this contract; or
    (3) To relieve the Contractor of any responsibility for performing 
this contract.
    (h) No subcontract or modification thereof placed under this 
contract shall provide for payment on a cost-plus-a-percentage-of-cost 
basis, and any fee payable under cost-reimbursement type subcontracts 
shall not exceed the fee limitations in FAR 15.404-4(c)(4)(i).
    (i) The Contractor shall give the Contracting Officer immediate 
written notice of any action or suit filed and prompt notice of any 
claim made against the Contractor by any subcontractor or vendor that, 
in the opinion of the Contractor, may result in litigation related in 
any way to this contract, with respect to which the Contractor may be 
entitled to reimbursement from the Government.
    (j) The Government reserves the right to review the Contractor's 
purchasing system as set forth in FAR Subpart 44.3.
    (k) Paragraphs (d) and (f) of this clause do not apply to the 
following subcontracts, which were evaluated during negotiations:

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

                             (End of clause)

    Alternate I (Aug 1998). As prescribed in 44.204(a)(2)(i), substitute 
the following paragraph (f)(2) for paragraph (f)(2) of the basic clause:

    (f)(2) If the Contractor has an approved purchasing system and 
consent is not required under paragraph (c), (d), or (e) of this clause, 
the Contractor nevertheless shall notify the Contracting Officer 
reasonably in advance of entering into any (i) cost-plus-fixed-fee 
subcontract, or (ii) fixed-price subcontract that exceeds the greater of 
the simplified acquisition threshold or 5 percent of the total estimated 
cost of this contract. The notification shall include the information 
required by paragraphs (f)(1)(i) through (f)(1)(iv) of this clause.

    Alternate II (Aug 1998). As prescribed in 44.204(a)(2)(ii), 
substitute the following paragraph (f)(2) for paragraph (f)(2) of the 
basic clause:

    (f)(2) If the Contractor has an approved purchasing system and 
consent is not required under paragraph (c), (d), or (e) of this clause, 
the Contractor nevertheless shall notify the Contracting Officer 
reasonably in advance of entering into any (i) cost-plus-fixed-fee 
subcontract, or (ii) fixed-price subcontract that exceeds either the 
simplified acquisition threshold or 5 percent of the total estimated 
cost of this contract. The notification shall include the information 
required by paragraphs (f)(1)(i) through (f)(1)(iv) of this clause.

[63 FR 34061, June 22, 1998]



Sec.  52.244-3  [Reserved]



Sec.  52.244-4  Subcontractors and outside associates and consultants 
(Architect-engineer services).

    As prescribed in 44.204(b), insert the following clause:

[[Page 295]]

    Subcontractors and Outside Associates and Consultants (Architect-
                      Engineer Services) (AUG 1998)

    Any subcontractors and outside associates or consultants required by 
the Contractor in connection with the services covered by the contract 
will be limited to individuals or firms that were specifically 
identified and agreed to during negotiations. The Contractor shall 
obtain the Contracting Officer's written consent before making any 
substitution for these subcontractors, associates, or consultants.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 63 FR 34062, June 22, 1998]



Sec.  52.244-5  Competition in Subcontracting.

    As prescribed in 44.204(c), insert the following clause:

                Competition in Subcontracting (DEC 1996)

    (a) The Contractor shall select subcontractors (including suppliers) 
on a competitive basis to the maximum practical extent consistent with 
the objectives and requirements of the contract.
    (b) If the Contractor is an approved mentor under the Department of 
Defense Pilot Mentor-Protege Program (Pub. L. 101-510, section 831 as 
amended), the Contractor may award subcontracts under this contract on a 
noncompetitive basis to its proteges.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34762, July 3, 1995; 
61 FR 2638, Jan 26, 1996; 61 FR 67420, Dec. 20, 1996; 63 FR 34062, June 
22, 1998]



Sec.  52.244-6  Subcontracts for Commercial Items.

    As prescribed in 44.403, insert the following clause:

              Subcontracts for Commercial Items (Apr. 2003)

    (a) Definitions. As used in this clause--
    Commercial item has the meaning contained in the clause at 52.202-1, 
Definitions.
    Subcontract includes a transfer of commercial items between 
divisions, subsidiaries, or affiliates of the Contractor or 
subcontractor at any tier.
    (b) To the maximum extent practicable, the Contractor shall 
incorporate, and require its subcontractors at all tiers to incorporate, 
commercial items or nondevelopmental items as components of items to be 
supplied under this contract.
    (c)(1) The Contractor shall insert the following clauses in 
subcontracts for commercial items:
    (i) 52.219-8, Utilization of Small Business Concerns (OCT 2000) (15 
U.S.C. 637(d)(2) and (3)), in all subcontracts that offer further 
subcontracting opportunities. If the subcontract (except subcontracts to 
small business concerns) exceeds $500,000 ($1,000,000 for construction 
of any public facility), the subcontractor must include 52.219-8 in 
lower tier subcontracts that offer subcontracting opportunities.
    (ii) 52.222-26, Equal Opportunity (MAY 2002) (E.O. 11246).
    (iii) 52.222-35, Equal Opportunity for Special Disabled Veterans, 
Veterans of the Vietnam Era, and Other Eligible Veterans (Dec 2001) (38 
U.S.C. 4212(a));
    (iv) 52.222-36, Affirmative Action for Workers with Disabilities 
(JUN 1998) (29 U.S.C. 793).
    (v) 52.247-64, Preference for Privately Owned U.S.-Flag Commercial 
Vessels (APR 2003) (46 U.S.C. Appx 1241 and 10 U.S.C. 2631) (flow down 
required in accordance with paragraph (d) of FAR clause 52.247-64).
    (2) While not required, the Contractor may flow down to subcontracts 
for commercial items a minimal number of additional clauses necessary to 
satisfy its contractual obligations.
    (d) The Contractor shall include the terms of this clause, including 
this paragraph (d), in subcontracts awarded under this contract.

                             (End of clause)

[60 FR 48256, Sept. 18, 1995, as amended at 63 FR 9059, Feb. 23, 1998; 
63 FR 58603, Oct. 30, 1998; 66 FR 2140, Jan. 10, 2001; 66 FR 53491, Nov. 
22, 2001; 67 FR 21539, Apr. 30, 2002; 68 FR 13204, Mar. 18, 2003; 68 FR 
28098, May 22, 2003]



Sec.  52.245-1  Property Records.

    As prescribed in 45.106(a), insert the following clause in 
solicitations and contracts when the conditions in 45.105(b) exist and 
the Government maintains the Government's official Government property 
records:

                       Property Records (APR 1984)

    The Government shall maintain the Government's official property 
records in connection with Government property under this contract. The 
Government Property clause is hereby modified by deleting the 
requirement for the Contractor to maintain such records.

[[Page 296]]

                             (End of clause)



Sec.  52.245-2  Government Property (Fixed-Price Contracts).

    As prescribed in 45.106(b)(1), insert the following clause:

         Government Property (Fixed-Price Contracts) (June 2003)

    (a) Government-furnished property--(1) The Government shall deliver 
to the Contractor, for use in connection with and under the terms of 
this contract, the Government-furnished property described in the 
Schedule or specifications together with any related data and 
information that the Contractor may request and is reasonably required 
for the intended use of the property (hereinafter referred to as 
Government-furnished property).
    (2) The delivery or performance dates for this contract are based 
upon the expectation that Government-furnished property suitable for use 
(except for property furnished as-is) will be delivered to the 
Contractor at the times stated in the Schedule or, if not so stated, in 
sufficient time to enable the Contractor to meet the contract's delivery 
or performance dates.
    (3) If Government-furnished property is received by the Contractor 
in a condition not suitable for the intended use, the Contractor shall, 
upon receipt of it, notify the Contracting Officer, detailing the facts, 
and, as directed by the Contracting Officer and at Government expense, 
either repair, modify, return, or otherwise dispose of the property. 
After completing the directed action and upon written request of the 
Contractor, the Contracting Officer shall make an equitable adjustment 
as provided in paragraph (h) of this clause.
    (4) If Government-furnished property is not delivered to the 
Contractor by the required time, the Contracting Officer shall, upon the 
Contractor's timely written request, make a determination of the delay, 
if any, caused the Contractor and shall make an equitable adjustment in 
accordance with paragraph (h) of this clause.
    (b) Changes in Government-furnished property. (1) The Contracting 
Officer may, by written notice, (i) decrease the Government-furnished 
property provided or to be provided under this contract, or (ii) 
substitute other Government-furnished property for the property to be 
provided by the Government, or to be acquired by the Contractor for the 
Government, under this contract. The Contractor shall promptly take such 
action as the Contracting Officer may direct regarding the removal, 
shipment, or disposal of the property covered by such notice.
    (2) Upon the Contractor's written request, the Contracting Officer 
shall make an equitable adjustment to the contract in accordance with 
paragraph (h) of this clause, if the Government has agreed in the 
Schedule to make the property available for performing this contract and 
there is any--
    (i) Decrease or substitution in this property pursuant to 
subparagraph (b)(1) above; or
    (ii) Withdrawal of authority to use this property, if provided under 
any other contract or lease.
    (c) Title in Government property. (1) The Government shall retain 
title to all Government-furnished property.
    (2) All Government-furnished property and all property acquired by 
the Contractor, title to which vests in the Government under this 
paragraph (collectively referred to as Government property), are subject 
to the provisions of this clause. However, special tooling accountable 
to this contract is subject to the provisions of the Special Tooling 
clause and is not subject to the provisions of this clause. Title to 
Government property shall not be affected by its incorporation into or 
attachment to any property not owned by the Government, nor shall 
Government property become a fixture or lose its identity as personal 
property by being attached to any real property.
    (3) Title to each item of facilities and special test equipment 
acquired by the Contractor for the Government under this contract shall 
pass to and vest in the Government when its use in performing this 
contract commences or when the Government has paid for it, whichever is 
earlier, whether or not title previously vested in the Government.
    (4) If this contract contains a provision directing the Contractor 
to purchase material for which the Government will reimburse the 
Contractor as a direct item of cost under this contract--
    (i) Title to material purchased from a vendor shall pass to and vest 
in the Government upon the vendor's delivery of such material; and
    (ii) Title to all other material shall pass to and vest in the 
Government upon--
    (A) Issuance of the material for use in contract performance;
    (B) Commencement of processing of the material or its use in 
contract performance; or
    (C) Reimbursement of the cost of the material by the Government, 
whichever occurs first.
    (d) Use of Government property. The Government property shall be 
used only for performing this contract, unless otherwise provided in 
this contract or approved by the Contracting Officer.
    (e) Property administration. (1) The Contractor shall be responsible 
and accountable for all Government property provided under this contract 
and shall comply with Federal Acquisition Regulation (FAR) subpart 45.5, 
as in effect on the date of this contract.

[[Page 297]]

    (2) The Contractor shall establish and maintain a program for the 
use, maintenance, repair, protection, and preservation of Government 
property in accordance with sound industrial practice and the applicable 
provisions of subpart 45.5 of the FAR.
    (3) If damage occurs to Government property, the risk of which has 
been assumed by the Government under this contract, the Government shall 
replace the items or the Contractor shall make such repairs as the 
Government directs. However, if the Contractor cannot effect such 
repairs within the time required, the Contractor shall dispose of the 
property as directed by the Contracting Officer. When any property for 
which the Government is responsible is replaced or repaired, the 
Contracting Officer shall make an equitable adjustment in accordance 
with paragraph (h) of this clause.
    (4) The Contractor represents that the contract price does not 
include any amount for repairs or replacement for which the Government 
is responsible. Repair or replacement of property for which the 
Contractor is responsible shall be accomplished by the Contractor at its 
own expense.
    (f) Access. The Government and all its designees shall have access 
at all reasonable times to the premises in which any Government property 
is located for the purpose of inspecting the Government property.
    (g) Risk of loss. Unless otherwise provided in this contract, the 
Contractor assumes the risk of, and shall be responsible for, any loss 
or destruction of, or damage to, Government property upon its delivery 
to the Contractor or upon passage of title to the Government under 
paragraph (c) of this clause. However, the Contractor is not responsible 
for reasonable wear and tear to Government property or for Government 
property properly consumed in performing this contract.
    (h) Equitable adjustment. When this clause specifies an equitable 
adjustment, it shall be made to any affected contract provision in 
accordance with the procedures of the Changes clause. When appropriate, 
the Contracting Officer may initiate an equitable adjustment in favor of 
the Government. The right to an equitable adjustment shall be the 
Contractor's exclusive remedy. The Government shall not be liable to 
suit for breach of contract for--
    (1) Any delay in delivery of Government-furnished property;
    (2) Delivery of Government-furnished property in a condition not 
suitable for its intended use;
    (3) A decrease in or substitution of Government-furnished property; 
or
    (4) Failure to repair or replace Government property for which the 
Government is responsible.
    (i) Final accounting and disposition of Government property. Upon 
completing this contract, or at such earlier dates as may be fixed by 
the Contracting Officer, the Contractor shall submit, in a form 
acceptable to the Contracting Officer, inventory schedules covering all 
items of Government property (including any resulting scrap) not 
consumed in performing this contract or delivered to the Government. The 
Contractor shall prepare for shipment, deliver f.o.b. origin, or dispose 
of the Government property as may be directed or authorized by the 
Contracting Officer. The net proceeds of any such disposal shall be 
credited to the contract price or shall be paid to the Government as the 
Contracting Officer directs.
    (j) Abandonment and restoration of Contractor's premises. Unless 
otherwise provided herein, the Government--
    (1) May abandon any Government property in place, at which time all 
obligations of the Government regarding such abandoned property shall 
cease; and
    (2) Has no obligation to restore or rehabilitate the Contractor's 
premises under any circumstances (e.g., abandonment, disposition upon 
completion of need, or upon contract completion). However, if the 
Government-furnished property (listed in the Schedule or specifications) 
is withdrawn or is unsuitable for the intended use, or if other 
Government property is substituted, then the equitable adjustment under 
paragraph (h) of this clause may properly include restoration or 
rehabilitation costs.
    (k) Communications. All communications under this clause shall be in 
writing.
    (l) Overseas contracts. If this contract is to be performed outside 
of the United States and it's outlying areas, the words Government and 
Government-furnished (wherever they appear in this clause) shall be 
construed as United States Government and United States Government-
furnished, respectively.

                             (End of clause)

    Alternate I (APR 1984). As prescribed in 45.106(b)(2), substitute 
the following paragraph (g) for paragraph (g) of the basic clause:

    (g) Limited risk of loss. (1) The term Contractor's managerial 
personnel, as used in this paragraph (g), means the Contractor's 
directors, officers, and any of the Contractor's managers, 
superintendents, or 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 operation at any 
one plant or separate location at which the contract is being performed; 
or
    (iii) A separate and complete major industrial operation connected 
with performing this contract.

[[Page 298]]

    (2) The Contractor shall not be liable for loss or destruction of, 
or damage to, the Government property provided under this contract (or, 
if an educational or nonprofit organization, for expenses incidental to 
such loss, destruction, or damage), except as provided in subparagraphs 
(3) and (4) below.
    (3) The Contractor shall be responsible for loss or destruction of, 
or damage to, the Government property provided under this contract 
(including expenses incidental to such loss, destruction, or damage)--
    (i) That results from a risk expressly required to be insured under 
this contract, but only to the extent of the insurance required to be 
purchased and maintained, or to the extent of insurance actually 
purchased and maintained, whichever is greater;
    (ii) That results from a risk that is in fact covered by insurance 
or for which the Contractor is otherwise reimbursed, but only to the 
extent of such insurance or reimbursement;
    (iii) For which the Contractor is otherwise responsible under the 
express terms of this contract;
    (iv) That results from willful misconduct or lack of good faith on 
the part of the Contractor's managerial personnel; or
    (v) That results from a failure on the part of the Contractor, due 
to willful misconduct or lack of good faith on the part of the 
Contractor's managerial personnel, to establish and administer a program 
or system for the control, use, protection, preservation, maintenance, 
and repair of Government property as required by paragraph (e) of this 
clause.
    (4)(i) If the Contractor fails to act as provided in subdivision 
(g)(3)(v) above, after being notified (by certified mail addressed to 
one of the Contractor's managerial personnel) of the Government's 
disapproval, withdrawal of approval, or nonacceptance of the system or 
program, it shall be conclusively presumed that such failure was due to 
willful misconduct or lack of good faith on the part of the Contractor's 
managerial personnel.
    (ii) In such event, any loss or destruction of, or damage to, the 
Government property shall be presumed to have resulted from such failure 
unless the Contractor can establish by clear and convincing evidence 
that such loss, destruction, or damage--
    (A) Did not result from the Contractor's failure to maintain an 
approved program or system; or
    (B) Occurred while an approved program or system was maintained by 
the Contractor.
    (5) If the Contractor transfers Government property to the 
possession and control of a subcontractor, the transfer shall not affect 
the liability of the Contractor for loss or destruction of, or damage 
to, the property as set forth above. However, the Contractor shall 
require the subcontractor to assume the risk of, and be responsible for, 
any loss or destruction of, or damage to, the property while in the 
subcontractor's possession or control, except to the extent that the 
subcontract, with the advance approval of the Contracting Officer, 
relieves the subcontractor from such liability. In the absence of such 
approval, the subcontract shall contain appropriate provisions requiring 
the return of all Government property in as good condition as when 
received, except for reasonable wear and tear or for its use in 
accordance with the provisions of the prime contract.
    (6) Upon loss or destruction of, or damage to, Government property 
provided under this contract, the Contractor shall so notify the 
Contracting Officer and shall communicate with the loss and salvage 
organization, if any, designated by the Contracting Officer. With the 
assistance of any such organization, the Contractor shall take all 
reasonable action to protect the Government property from further 
damage, separate the damaged and undamaged Government property, put all 
the affected Government property in the best possible order, and furnish 
to the Contracting Officer a statement of--
    (i) The lost, destroyed, or damaged Government property;
    (ii) The time and origin of the loss, destruction, or damage;
    (iii) All known interests in commingled property of which the 
Government property is a part; and
    (iv) The insurance, if any, covering any part of or interest in such 
commingled property.
    (7) The Contractor shall repair, renovate, and take such other 
action with respect to damaged Government property as the Contracting 
Officer directs. If the Government property is destroyed or damaged 
beyond practical repair, or is damaged and so commingled or combined 
with property of others (including the Contractor's) that separation is 
impractical, the Contractor may, with the approval of and subject to any 
conditions imposed by the Contracting Officer, sell such property for 
the account of the Government. Such sales may be made in order to 
minimize the loss to the Government, to permit the resumption of 
business, or to accomplish a similar purpose. The Contractor shall be 
entitled to an equitable adjustment in the contract price for the 
expenditures made in performing the obligations under this subparagraph 
(g)(7) in accordance with paragraph (h) of this clause. However, the 
Government may directly reimburse the loss and salvage organization for 
any of their charges. The Contracting Officer shall give due regard to 
the Contractor's liability under this paragraph (g) when making any such 
equitable adjustment.
    (8) The Contractor represents that it is not including in the price 
and agrees it will not

[[Page 299]]

hereafter include in any price to the Government any charge or reserve 
for insurance (including any self- insurance fund or reserve) covering 
loss or destruction of, or damage to, Government property, except to the 
extent that the Government may have expressly required the Contractor to 
carry such insurance under another provision of this contract.
    (9) In the event the Contractor is reimbursed or otherwise 
compensated for any loss or destruction of, or damage to, Government 
property, the Contractor shall use the proceeds to repair, renovate, or 
replace the lost, destroyed, or damaged Government property or shall 
otherwise credit the proceeds to or equitably reimburse the Government, 
as directed by the Contracting Officer.
    (10) The Contractor shall do nothing to prejudice the Government's 
rights to recover against third parties for any loss or destruction of, 
or damage to, Government property. Upon the request of the Contracting 
Officer, the Contractor shall, at the Government's expense, furnish to 
the Government all reasonable assistance and cooperation (including the 
prosecution of suit and the execution of instruments of assignment in 
favor of the Government) in obtaining recovery. In addition, where a 
subcontractor has not been relieved from liability for any loss or 
destruction of, or damage to, Government property, the Contractor shall 
enforce for the benefit of the Government the liability of the 
subcontractor for such loss, destruction, or damage.

    Alternate II (June 2003). As prescribed in 45.106(b)(3), substitute 
the following paragraphs (c) and (g) for paragraphs (c) and (g) of the 
basic clause:

    (c) Title in Government property. (1) The Government shall retain 
title to all Government-furnished property.
    (2) All Government-furnished property and all property acquired by 
the Contractor, title to which vests in the Government under this 
paragraph (collectively referred to as Government property), are subject 
to the provisions of this clause. Title to Government property shall not 
be affected by its incorporation into or attachment to any property not 
owned by the Government, nor shall Government property become a fixture 
or lose its identity as personal property by being attached to any real 
property.
    (3) Title to each item of facilities, special test equipment, and 
special tooling (other than that subject to a special tooling clause) 
acquired by the Contractor for the Government under this contract shall 
pass to and vest in the Government when its use in performing this 
contract commences, or when the Government has paid for it, whichever is 
earlier, whether or not title previously vested in the Government.
    (4) Title to equipment (and other tangible personal property) 
purchased with funds available for research and having an acquisition 
cost of less than $5,000 shall vest in the Contractor upon acquisition 
or as soon thereafter as feasible; provided, that the Contractor 
obtained the Contracting Officer's approval before each acquisition. 
Title to equipment purchased with funds available for research and 
having an acquisition cost of $5,000 or more shall vest as set forth in 
the contract. If title to equipment vests in the Contractor under this 
subparagraph (c)(4), the Contractor agrees that no charge will be made 
to the Government for any depreciation, amortization, or use under any 
existing or future Government contract or subcontract thereunder. The 
Contractor shall furnish the Contracting Officer a list of all equipment 
to which title is vested in the Contractor under this subparagraph 
(c)(4) within 10 days following the end of the calendar quarter during 
which it was received.
    (5) Vesting title under this paragraph (c) is subject to civil 
rights legislation, 42 U.S.C. 2000d. Before title is vested and by 
signing this contract, the Contractor accepts and agrees that--

No person in the United States or its outlying areas shall, on the 
ground of race, color, or national origin, be excluded from 
participation in, be denied the benefits of, or be otherwise subjected 
to discrimination under this contemplated financial assistance (title to 
equipment).
    (g) Limited risk of loss. (1) The term Contractor's managerial 
personnel, as used in this paragraph (g), means the Contractor's 
directors, officers, and any of the Contractor's managers, 
superintendents, or 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 operation at any 
one plant, laboratory, or separate location at which the contract is 
being performed; or
    (iii) A separate and complete major industrial operation connected 
with performing this contract.
    (2) The Contractor shall not be liable for loss or destruction of, 
or damage to, the Government property provided under this contract (or, 
if an educational or nonprofit organization, for expenses incidental to 
such loss, destruction, or damage), except as provided in subparagraphs 
(3) and (4) below.
    (3) The Contractor shall be responsible for loss or destruction of, 
or damage to, the Government property provided under this contract 
(including expenses incidental to such loss, destruction, or damage)--
    (i) That results from a risk expressly required to be insured under 
this contract, but only to the extent of the insurance required to be 
purchased and maintained, or to the

[[Page 300]]

extent of insurance actually purchased and maintained, whichever is 
greater;
    (ii) That results from a risk which is in fact covered by insurance 
or for which the Contractor is otherwise reimbursed, but only to the 
extent of such insurance or reimbursement;
    (iii) For which the Contractor is otherwise responsible under the 
express terms of this contract;
    (iv) That results from willful misconduct or lack of good faith on 
the part of the Contractor's managerial personnel; or
    (v) That results from a failure on the part of the Contractor, due 
to willful misconduct or lack of good faith on the part of the 
Contractor's managerial personnel, to establish and administer a program 
or system for the control, use, protection, preservation, maintenance, 
and repair of Government property as required by paragraph (e) of this 
clause.
    (4)(i) If the Contractor fails to act as provided in subdivision 
(g)(3)(v) above, after being notified (by certified mail addressed to 
one of the Contractor's managerial personnel) of the Government's 
disapproval, withdrawal of approval, or nonacceptance of the system or 
program, it shall be conclusively presumed that such failure was due to 
willful misconduct or lack of good faith on the part of the Contractor's 
managerial personnel.
    (ii) Furthermore, any loss or destruction of, or damage to, the 
Government property shall be presumed to have resulted from such failure 
unless the Contractor can establish by clear and convincing evidence 
that such loss, destruction, or damage--
    (A) Did not result from the Contractor's failure to maintain an 
approved program or system; or
    (B) Occurred while an approved program or system was maintained by 
the Contractor.
    (5) If the Contractor transfers Government property to the 
possession and control of a subcontractor, the transfer shall not affect 
the liability of the Contractor for loss or destruction of, or damage 
to, the property as set forth above. However, the Contractor shall 
require the subcontractor to assume the risk of, and be responsible for, 
any loss or destruction of, or damage to, the property while in the 
subcontractor's possession or control, except to the extent that the 
subcontract, with the advance approval of the Contracting Officer, 
relieves the subcontractor from such liability. In the absence of such 
approval, the subcontract shall contain appropriate provisions requiring 
the return of all Government property in as good condition as when 
received, except for reasonable wear and tear or for its use in 
accordance with the provisions of the prime contract.
    (6) Upon loss or destruction of, or damage to, Government property 
provided under this contract, the Contractor shall so notify the 
Contracting Officer and shall communicate with the loss and salvage 
organization, if any, designated by the Contracting Officer. With the 
assistance of any such organization, the Contractor shall take all 
reasonable action to protect the Government property from further 
damage, separate the damaged and undamaged Government property, put all 
the affected Government property in the best possible order, and furnish 
to the Contracting Officer a statement of--
    (i) The lost, destroyed, or damaged Government property;
    (ii) The time and origin of the loss, destruction, or damage;
    (iii) All known interests in commingled property of which the 
Government property is a part; and
    (iv) The insurance, if any, covering any part of or interest in such 
commingled property.
    (7) The Contractor shall repair, renovate, and take such other 
action with respect to damaged Government property as the Contracting 
Officer directs. If the Government property is destroyed or damaged 
beyond practical repair, or is damaged and so commingled or combined 
with property of others (including the Contractor's) that separation is 
impractical, the Contractor may, with the approval of and subject to any 
conditions imposed by the Contracting Officer, sell such property for 
the account of the Government. Such sales may be made in order to 
minimize the loss to the Government, to permit the resumption of 
business, or to accomplish a similar purpose. The Contractor shall be 
entitled to an equitable adjustment in the contract price for the 
expenditures made in performing the obligations under this subparagraph 
(g)(7) in accordance with paragraph (h) of this clause. However, the 
Government may directly reimburse the loss and salvage organization for 
any of their charges. The Contracting Officer shall give due regard to 
the Contractor's liability under this paragraph (g) when making any such 
equitable adjustment.
    (8) The Contractor represents that it is not including in the price, 
and agrees it will not hereafter include in any price to the Government, 
any charge or reserve for insurance (including any self-insurance fund 
or reserve) covering loss or destruction of, or damage to, Government 
property, except to the extent that the Government may have expressly 
required the Contractor to carry such insurance under another provision 
of this contract.
    (9) In the event the Contractor is reimbursed or otherwise 
compensated for any loss or destruction of, or damage to, the Government 
property, the Contractor shall use the proceeds to repair, renovate, or 
replace the lost, destroyed, or damaged Government property or shall 
otherwise credit the proceeds to or equitably reimburse the Government, 
as directed by the Contracting Officer.

[[Page 301]]

    (10) The Contractor shall do nothing to prejudice the Government's 
rights to recover against third parties for any loss or destruction of, 
or damage to, Government property. Upon the request of the Contracting 
Officer, the Contractor shall, at the Government's expense, furnish to 
the Government all reasonable assistance and cooperation (including the 
prosecution of suit and the execution of instruments of assignment in 
favor of the Government) in obtaining recovery. In addition, where a 
subcontractor has not been relieved from liability for any loss or 
destruction of, or damage to, Government property, the Contractor shall 
enforce for the benefit of the Government the liability of the 
subcontractor for such loss, destruction, or damage.

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 26904, June 28, 1985; 
54 FR 48995, Nov. 28, 1989; 68 FR 28087, May 22, 2003]



Sec.  52.245-3  Identification of Government-Furnished Property.

    As prescribed in 45.106(c), insert the following clause, in addition 
to the clause at 52.245-2, Government Property (Fixed-Price Contracts), 
in solicitations and contracts when a fixed-price construction contract 
is contemplated under which the Government is to furnish Government 
property f.o.b. railroad cars at a specified destination or f.o.b. truck 
at the project site. The contract Schedule shall specify the point of 
delivery and may include special terms and conditions covering 
installation, preparation for operation, or equipment testing by the 
Government or by another contractor.

       Identification of Government-Furnished Property (APR 1984)

    (a) The Government will furnish to the Contractor the property 
identified in the Schedule to be incorporated or installed into the work 
or used in performing the contract. The listed property will be 
furnished f.o.b. railroad cars at the place specified in the contract 
Schedule or f.o.b. truck at the project site. The Contractor is required 
to accept delivery, pay any demurrage or detention charges, and unload 
and transport the property to the job site at its own expense. When the 
property is delivered, the Contractor shall verify its quantity and 
condition and acknowledge receipt in writing to the Contracting Officer. 
The Contractor shall also report in writing to the Contracting Officer 
within 24 hours of delivery any damage to or shortage of the property as 
received. All such property shall be installed or incorporated into the 
work at the expense of the Contractor, unless otherwise indicated in 
this contract.
    (b) Each item of property to be furnished under this clause shall be 
identified in the Schedule by quantity, item, and description.

                             (End of clause)



Sec.  52.245-4  Government-Furnished Property (Short Form).

    As prescribed in 45.106(d), insert the following clause:

         Government-Furnished Property (Short Form) (June 2003)

    (a) The Government shall deliver to the Contractor, at the time and 
locations stated in this contract, the Government-furnished property 
described in the Schedule or specifications. If that property, suitable 
for its intended use, is not delivered to the Contractor, the 
Contracting Officer shall equitably adjust affected provisions of this 
contract in accordance with the Changes clause when--
    (1) The Contractor submits a timely written request for an equitable 
adjustment; and
    (2) The facts warrant an equitable adjustment.
    (b) Title to Government-furnished property shall remain in the 
Government. The Contractor shall use the Government-furnished property 
only in connection with this contract. The Contractor shall maintain 
adequate property control records in accordance with sound industrial 
practice and will make such records available for Government inspection 
at all reasonable times, unless the clause at Federal Acquisition 
Regulation 52.245-1, Property Records, is included in this contract.
    (c) Upon delivery of Government-furnished property to the 
Contractor, the Contractor assumes the risk and responsibility for its 
loss or damage, except--
    (1) For reasonable wear and tear;
    (2) To the extent property is consumed in performing this contract; 
or
    (3) As otherwise provided for by the provisions of this contract.
    (d) Upon completing this contract, the Contractor shall follow the 
instructions of the Contracting Officer regarding the disposition of all 
Government-furnished property not consumed in performing this contract 
or previously delivered to the Government. The Contractor shall prepare 
for shipment, deliver f.o.b. origin, or dispose of the Government 
property, as may be directed or authorized by the Contracting Officer. 
The net proceeds of any such disposal shall be credited to the contract 
price or shall be paid to the Government as directed by the Contracting 
Officer.

[[Page 302]]

    (e) If this contract is to be performed outside the Untied States 
and its outlying areas, the words ``Government'' and ``Government-
furnished'' (wherever they appear in this clause) shall be construed as 
``United States Government'' and ``United States Governmen-furnished,'' 
respectively.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 53 FR 663, Jan. 11, 1988; 68 
FR 28087, May 22, 2003]



Sec.  52.245-5  Government Property (Cost-Reimbursement, Time-and-Material, 
or Labor-Hour Contracts).

    As prescribed in 45.106(f)(1), insert the following clause:

  Government Property (Cost-Reimbursement, Time-and-Material, or Labor-
                       Hour Contracts) (June 2003)

    (a) Government-furnished property. (1) The term Contractor's 
managerial personnel, as used in paragraph (g) of this clause, means any 
of the Contractor's directors, officers, managers, superintendents, or 
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 operation at any 
one plant, or separate location at which the contract is being 
performed; or
    (iii) A separate and complete major industrial operation connected 
with performing this contract.
    (2) The Government shall deliver to the Contractor, for use in 
connection with and under the terms of this contract, the Government-
furnished property described in the Schedule or specifications, together 
with such related data and information as the Contractor may request and 
as may be reasonably required for the intended use of the property 
(hereinafter referred to as Government-furnished property).
    (3) The delivery or performance dates for this contract are based 
upon the expectation that Government-furnished property suitable for use 
will be delivered to the Contractor at the times stated in the Schedule 
or, if not so stated, in sufficient time to enable the Contractor to 
meet the contract's delivery or performance dates.
    (4) If Government-furnished property is received by the Contractor 
in a condition not suitable for the intended use, the Contractor shall, 
upon receipt, notify the Contracting Officer, detailing the facts, and, 
as directed by the Contracting Officer and at Government expense, either 
effect repairs or modification or return or otherwise dispose of the 
property. After completing the directed action and upon written request 
of the Contractor, the Contracting Officer shall make an equitable 
adjustment as provided in paragraph (h) of this clause.
    (5) If Government-furnished property is not delivered to the 
Contractor by the required time or times, the Contracting Officer shall, 
upon the Contractor's timely written request, make a determination of 
the delay, if any, caused the Contractor and shall make an equitable 
adjustment in accordance with paragraph (h) of this clause.
    (b) Changes in Government-furnished property. (1) The Contracting 
Officer may, by written notice, (i) decrease the Government-furnished 
property provided or to be provided under this contract or (ii) 
substitute other Government-furnished property for the property to be 
provided by the Government or to be acquired by the Contractor for the 
Government under this contract. The Contractor shall promptly take such 
action as the Contracting Officer may direct regarding the removal, 
shipment, or disposal of the property covered by this notice.
    (2) Upon the Contractor's written request, the Contracting Officer 
shall make an equitable adjustment to the contract in accordance with 
paragraph (h) of this clause, if the Government has agreed in the 
Schedule to make such property available for performing this contract 
and there is any--
    (i) Decrease or substitution in this property pursuant to 
subparagraph (b)(1) above; or
    (ii) Withdrawal of authority to use property, if provided under any 
other contract or lease.
    (c) Title. (1) The Government shall retain title to all Government-
furnished property.
    (2) Title to all property purchased by the Contractor for which the 
Contractor is entitled to be reimbursed as a direct item of cost under 
this contract shall pass to and vest in the Government upon the vendor's 
delivery of such property.
    (3) Title to all other property, the cost of which is reimbursable 
to the Contractor, shall pass to and vest in the Government upon--
    (i) Issuance of the property for use in contract performance;
    (ii) Commencement of processing of the property or use in contract 
performance; or
    (iii) Reimbursement of the cost of the property by the Government, 
whichever occurs first.
    (4) All Government-furnished property and all property acquired by 
the Contractor, title to which vests in the Government under this 
paragraph (collectively referred to as Government property), are subject 
to the provisions of this clause. Title to Government property shall not 
be affected by its incorporation into or attachment to any property not 
owned by the Government, nor shall Government property become a fixture 
or lose its

[[Page 303]]

identity as personal property by being attached to any real property.
    (d) Use of Government property. The Government property shall be 
used only for performing this contract, unless otherwise provided in 
this contract or approved by the Contracting Officer.
    (e) Property administration. (1) The Contractor shall be responsible 
and accountable for all Government property provided under the contract 
and shall comply with Federal Acquisition Regulation (FAR) subpart 45.5, 
as in effect on the date of this contract.
    (2) The Contractor shall establish and maintain a program for the 
use, maintenance, repair, protection, and preservation of Government 
property in accordance with sound business practice and the applicable 
provisions of FAR subpart 45.5.
    (3) If damage occurs to Government property, the risk of which has 
been assumed by the Government under this contract, the Government shall 
replace the items or the Contractor shall make such repairs as the 
Government directs. However, if the Contractor cannot effect such 
repairs within the time required, the Contractor shall dispose of the 
property as directed by the Contracting Officer. When any property for 
which the Government is responsible is replaced or repaired, the 
Contracting Officer shall make an equitable adjustment in accordance 
with paragraph (h) of this clause.
    (f) Access. The Government and all its designees shall have access 
at all reasonable times to the premises in which any Government property 
is located for the purpose of inspecting the Government property.
    (g) Limited risk of loss. (1) The Contractor shall not be liable for 
loss or destruction of, or damage to, the Government property provided 
under this contract or for expenses incidental to such loss, 
destruction, or damage, except as provided in subparagraphs (2) and (3) 
below.
    (2) The Contractor shall be responsible for loss or destruction of, 
or damage to, the Government property provided under this contract 
(including expenses incidental to such loss, destruction, or damage)--
    (i) That results from a risk expressly required to be insured under 
this contract, but only to the extent of the insurance required to be 
purchased and maintained or to the extent of insurance actually 
purchased and maintained, whichever is greater;
    (ii) That results from a risk that is in fact covered by insurance 
or for which the Contractor is otherwise reimbursed, but only to the 
extent of such insurance or reimbursement;
    (iii) For which the Contractor is otherwise responsible under the 
express terms of this contract;
    (iv) That results from willful misconduct or lack of good faith on 
the part of the Contractor's managerial personnel; or
    (v) That results from a failure on the part of the Contractor, due 
to willful misconduct or lack of good faith on the part of the 
Contractor's managerial personnel, to establish and administer a program 
or system for the control, use, protection, preservation, maintenance, 
and repair of Government property as required by paragraph (e) of this 
clause.
    (3)(i) If the Contractor fails to act as provided by subdivision 
(g)(2)(v) above, after being notified (by certified mail addressed to 
one of the Contractor's managerial personnel) of the Government's 
disapproval, withdrawal of approval, or nonacceptance of the system or 
program, it shall be conclusively presumed that such failure was due to 
willful misconduct or lack of good faith on the part of the Contractor's 
managerial personnel.
    (ii) In such event, any loss or destruction of, or damage to, the 
Government property shall be presumed to have resulted from such failure 
unless the Contractor can establish by clear and convincing evidence 
that such loss, destruction, or damage--
    (A) Did not result from the Contractor's failure to maintain an 
approved program or system; or
    (B) Occurred while an approved program or system was maintained by 
the Contractor.
    (4) If the Contractor transfers Government property to the 
possession and control of a subcontractor, the transfer shall not affect 
the liability of the Contractor for loss or destruction of, or damage 
to, the property as set forth above. However, the Contractor shall 
require the subcontractor to assume the risk of, and be responsible for, 
any loss or destruction of, or damage to, the property while in the 
subcontractor's possession or control, except to the extent that the 
subcontract, with the advance approval of the Contracting Officer, 
relieves the subcontractor from such liability. In the absence of such 
approval, the subcontract shall contain appropriate provisions requiring 
the return of all Government property in as good condition as when 
received, except for reasonable wear and tear or for its use in 
accordance with the provisions of the prime contract.
    (5) Upon loss or destruction of, or damage to, Government property 
provided under this contract, the Contractor shall so notify the 
Contracting Officer and shall communicate with the loss and salvage 
organization, if any, designated by the Contracting Officer. With the 
assistance of any such organization, the Contractor shall take all 
reasonable action to protect the Government property from further 
damage, separate the damaged and undamaged Government property, put all 
the affected Government property in the best possible order, and furnish 
to the Contracting Officer a statement of--
    (i) The lost, destroyed, or damaged Government property;

[[Page 304]]

    (ii) The time and origin of the loss, destruction, or damage;
    (iii) All known interests in commingled property of which the 
Government property is a part; and
    (iv) The insurance, if any, covering any part of or interest in such 
commingled property.
    (6) The Contractor shall repair, renovate, and take such other 
action with respect to damaged Government property as the Contracting 
Officer directs. If the Government property is destroyed or damaged 
beyond practical repair, or is damaged and so commingled or combined 
with property of others (including the Contractor's) that separation is 
impractical, the Contractor may, with the approval of and subject to any 
conditions imposed by the Contracting Officer, sell such property for 
the account of the Government. Such sales may be made in order to 
minimize the loss to the Government, to permit the resumption of 
business, or to accomplish a similar purpose. The Contractor shall be 
entitled to an equitable adjustment in the contract price for the 
expenditures made in performing the obligations under this subparagraph 
(g)(6) in accordance with paragraph (h) of this clause. However, the 
Government may directly reimburse the loss and salvage organization for 
any of their charges. The Contracting Officer shall give due regard to 
the Contractor's liability under this paragraph (g) when making any such 
equitable adjustment.
    (7) The Contractor shall not be reimbursed for, and shall not 
include as an item of overhead, the cost of insurance or of any reserve 
covering risk of loss or destruction of, or damage to, Government 
property, except to the extent that the Government may have expressly 
required the Contractor to carry such insurance under another provision 
of this contract.
    (8) In the event the Contractor is reimbursed or otherwise 
compensated for any loss or destruction of, or damage to, Government 
property, the Contractor shall use the proceeds to repair, renovate, or 
replace the lost, destroyed, or damaged Government property or shall 
otherwise credit the proceeds to, or equitably reimburse, the 
Government, as directed by the Contracting Officer.
    (9) The Contractor shall do nothing to prejudice the Government's 
rights to recover against third parties for any loss or destruction of, 
or damage to, Government property. Upon the request of the Contracting 
Officer, the Contractor shall, at the Government's expense, furnish to 
the Government all reasonable assistance and cooperation (including the 
prosecution of suit and the execution of instruments of assignment in 
favor of the Government) in obtaining recovery. In addition, where a 
subcontractor has not been relieved from liability for any loss or 
destruction of, or damage to, Government property, the Contractor shall 
enforce for the benefit of the Government the liability of the 
subcontractor for such loss, destruction, or damage.
    (h) Equitable adjustment. When this clause specifies an equitable 
adjustment, it shall be made to any affected contract provision in 
accordance with the procedures of the Changes clause. When appropriate, 
the Contracting Officer may initiate an equitable adjustment in favor of 
the Government. The right to an equitable adjustment shall be the 
Contractor's exclusive remedy. The Government shall not be liable to 
suit for breach of contract for--
    (1) Any delay in delivery of Government-furnished property;
    (2) Delivery of Government-furnished property in a condition not 
suitable for its intended use;
    (3) A decrease in or substitution of Government-furnished property; 
or
    (4) Failure to repair or replace Government property for which the 
Government is responsible.
    (i) Final accounting and disposition of Government property. Upon 
completing this contract, or at such earlier dates as may be fixed by 
the Contracting Officer, the Contractor shall submit, in a form 
acceptable to the Contracting Officer, inventory schedules covering all 
items of Government property not consumed in performing this contract or 
delivered to the Government. The Contractor shall prepare for shipment, 
deliver f.o.b. origin, or dispose of the Government property as may be 
directed or authorized by the Contracting Officer. The net proceeds of 
any such disposal shall be credited to the cost of the work covered by 
this contract or paid to the Government as directed by the Contracting 
Officer. The foregoing provisions shall apply to scrap from Government 
property; provided, however, that the Contracting Officer may authorize 
or direct the Contractor to omit from such inventory schedules any scrap 
consisting of faulty castings or forgings or of cutting and processing 
waste, such as chips, cuttings, borings, turnings, short ends, circles, 
trimmings, clippings, and remnants, and to dispose of such scrap in 
accordance with the Contractor's normal practice and account for it as a 
part of general overhead or other reimbursable costs in accordance with 
the Contractor's established accounting procedures.
    (j) Abandonment and restoration of Contractor premises. Unless 
otherwise provided herein, the Government--
    (1) May abandon any Government property in place, at which time all 
obligations of the Government regarding such abandoned property shall 
cease; and
    (2) Has no obligation to restore or rehabilitate the Contractor's 
premises under any circumstances (e.g., abandonment, disposition

[[Page 305]]

upon completion of need, or contract completion). However, if the 
Government-furnished property (listed in the Schedule or specifications) 
is withdrawn or is unsuitable for the intended use, or if other 
Government property is substituted, then the equitable adjustment under 
paragraph (h) of this clause may properly include restoration or 
rehabilitation costs.
    (k) Communications. All communications under this clause shall be in 
writing.
    (l) Overseas contracts. If this contract is to be performed outside 
the United States of America and its outlying areas the words Government 
and Government-furnished (wherever they appear in this clause) shall be 
construed as United States Government and United States Government-
furnished, respectively.

                             (End of clause)

    Alternate I (June 2003). As prescribed in 45.106(f)(2), substitute 
the following paragraph (c) for paragraph (c) of the basic clause:

    (c) Title. (1) The Government shall retain title to all Government-
furnished property.
    (2) All Government-furnished property and all property acquired by 
the Contractor, title to which vests in the Government under this 
paragraph (collectively referred to as Government property), are subject 
to the provisions of this clause. Title to Government property shall not 
be affected by its incorporation into or attachment to any property not 
owned by the Government, nor shall Government property become a fixture 
or lose its identity as personal property by being attached to any real 
property.
    (3) Title to all property purchased by the Contractor for which the 
Contractor is entitled to be reimbursed as a direct item of cost under 
this contract and that, under the provisions of this contract is to vest 
in the Government, shall pass to and vest in the Government upon the 
vendor's delivery of such property. Title to all other property, the 
cost of which is to be reimbursed to the Contractor under this contract 
and that under the provisions of this contract is to vest in the 
Government, shall pass to and vest in the Government upon--
    (i) Issuance of the property for use in contract performance;
    (ii) Commencement of processing of the property or its use in 
contract performance; or
    (iii) Reimbursement of the cost of the property by the Government, 
whichever occurs first.
    (4) Title to equipment (and other tangible personal property) 
purchased with funds available for research and having an acquisition 
cost of less than $5,000 shall vest in the Contractor upon acquisition 
or as soon thereafter as feasible; provided, that the Contractor 
obtained the Contracting Officer's approval before each acquisition. 
Title to equipment purchased with funds available for research and 
having an acquisition cost of $5,000 or more shall vest as set forth in 
the contract. If title to equipment vests in the Contractor under this 
subparagraph (c)(4), the Contractor agrees that no charge will be made 
to the Government for any depreciation, amortization, or use under any 
existing or future Government contract or subcontract thereunder. The 
Contractor shall furnish the Contracting Officer a list of all equipment 
to which title is vested in the Contractor under this subparagraph 
(c)(4) within 10 days following the end of the calendar quarter during 
which it was received.
    (5) Vesting title under this paragraph (c) is subject to civil 
rights legislation, 42 U.S.C. 2000d. Before title is vested and by 
signing this contract, the Contractor accepts and agrees that--

No person in the United States or its outlying text shall, on the ground 
of race, color, or national origin, be excluded from participation in, 
be denied the benefits of, or be otherwise subjected to discrimination 
under this contemplated financial assistance (title to equipment).

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 26904, June 28, 1985; 
51 FR 2667, Jan. 17, 1986; 55 FR 3889, Feb. 5, 1990; 68 FR 28087, May 
22, 2003]



Sec.  52.245-6  Liability for Government Property (Demolition Services Contracts).

    As prescribed in 45.106(g) insert the following clause, in addition 
to the clauses prescribed at 37.304, in solicitations and contracts for 
dismantling, demolition, or removal of improvements:

 Liability for Government Property (Demolition Services Contracts) (APR 
                                  1984)

    Except for reasonable wear and tear incident to removal and delivery 
to the Government, the Contractor assumes the risk of and shall be 
responsible for any loss or destruction of, or damage to, items of 
property, title to which--
    (a) Remains in the Government and that are to be delivered to the 
Government by the Contractor in performing the work; and
    (b) Is vested in the Contractor but that under the Termination 
clauses of this contract is revested in the Government upon notice of 
termination.

[[Page 306]]

                             (End of clause)



Sec.  52.245-7  Government Property (Consolidated Facilities).

    As prescribed in 45.302-6(a), insert the following clause in 
solicitations and contracts when a consolidated facilities contract is 
contemplated:

        Government Property (Consolidated Facilities) (MAR 1996)

    (a) Definitions. For the purpose of this contract, the following 
definitions apply:
    Facilities, as used in this clause, means all property provided 
under this facilities contract.
    Related contract, as used in this clause, means a Government 
contract or subcontract for supplies or services under which the use of 
the facilities is or may be authorized.
    (b) Facilities to be provided. (1) The Contractor, at Government 
expense and subject to the provisions of this contract, shall acquire, 
construct, or install the facilities and perform the related work as 
described in the Schedule.
    (2) The Government, subject to the provisions of this contract, 
shall furnish to the Contractor the facilities identified in the 
Schedule as Government-furnished facilities. The Contractor, at 
Government expense, shall perform the work with respect to those 
facilities as is described in the Schedule.
    (3) All shipments of the facilities shall be made on Government 
bills of lading, unless otherwise authorized by the Contracting Officer. 
The required number of such Government bills of lading will be furnished 
to the Contractor by, and the Contractor shall be accountable therefor 
to, the transportation activity designated by the Contracting Officer.
    (c) Period of this contract. If not otherwise specified in the 
contract and if not previously terminated under paragraph (m), the use 
of the facilities authorized under this contract shall terminate 5 years 
after its effective date. Thereafter, if continued use of the facilities 
by the Contractor is mutually desired, the parties shall enter into a 
new contract that shall incorporate such provisions as may then be 
required by applicable laws and regulations. The parties may, by written 
agreement, extend the use of the facilities under this contract beyond 
this 5-year period to permit the completion of any then-existing related 
contracts and subcontracts.
    (d) Title in the facilities. (1) The Government shall retain title 
to all Government-furnished property.
    (2) Title to all facilities and components shall pass to and vest in 
the Government upon delivery by the vendor of all such items purchased 
by the Contractor for which it is entitled to be reimbursed as a direct 
item of cost under this contract.
    (3) Title to replacement parts furnished by the Contractor in 
carrying out its normal maintenance obligations under paragraph (h) 
shall pass to and vest in the Government upon completion of their 
installation in the facilities.
    (4) Title to other property, the cost of which is reimbursable to 
the Contractor under this contract, shall pass to and vest in the 
Government upon--
    (i) Issuance of the property for use in performing this contract;
    (ii) Commencement of processing or use of the property in performing 
this contract; or
    (iii) Reimbursement of the cost of the property by the Government, 
whichever occurs first.
    (5) Title to the facilities shall not be affected by their 
incorporation into or attachment to any property not owned by the 
Government, nor shall any item of the facilities become a fixture or 
lose its identity as personal property by being attached to any real 
property. The Contractor shall keep the facilities free and clear of all 
liens and encumbrances and, except as otherwise authorized by this 
contract or by the Contracting Officer, shall not remove or otherwise 
part with possession of, or permit the use by others of, any of the 
facilities.
    (6) The Contractor may, with the written approval of the Contracting 
Officer, install, arrange, or rearrange, on Government-furnished 
premises, readily movable machinery, equipment, and other items 
belonging to the Contractor. Title to any such item shall remain in the 
Contractor even though it may be attached to real property owned by the 
Government, unless the Contracting Officer determines that it is so 
permanently attached that removal would cause substantial injury to 
Government property.
    (7) The Contractor shall not construct or install, at its own 
expense, any fixed improvement or structural alterations in Government 
buildings or other real property without advance written approval of the 
Contracting Officer. Fixed improvement or structural alterations, as 
used herein, means any alteration or improvement in the nature of the 
building or other real property, that, after completion, cannot be 
removed without substantial loss of value or damage to the premises. The 
term does not include foundations for production equipment.
    (e) Location of the facilities. The Contractor may use the 
facilities at any of the locations specified in the Schedule and, with 
the prior written approval of the Contracting Officer, at any other 
location. In granting this approval, the Contracting Officer may 
prescribe such terms and conditions as may be deemed necessary for 
protecting the Government's interest in the facilities involved.

[[Page 307]]

Those terms and conditions shall take precedence over any conflicting 
provisions of this contract.
    (f) Notice of use of the facilities. The Contractor shall notify the 
Contracting Officer in writing--
    (1) Whenever use of all facilities for Government work in any 
quarterly period averages less than 75 percent of the total use of the 
facilities; or
    (2) Whenever any item of the facilities is no longer needed or 
usable for performing existing related contracts that authorize such 
use.
    (g) Property control. The Contractor shall maintain property control 
procedures and records and a system of identification of the facilities, 
in accordance with the provisions of Federal Acquisition Regulation 
(FAR) subpart 45.5 in effect on the date of this contract. The 
provisions of FAR 45.5 are hereby incorporated by reference and made a 
part of this contract.
    (h) Maintenance. (1) Except as otherwise provided in the Schedule, 
the Contractor shall perform normal maintenance of the facilities in 
accordance with sound industrial practice, including protection, 
preservation, and repair of the facilities and normal parts replacement 
for equipment.
    (2) As soon as practicable after the execution of this contract, the 
Contractor shall submit to the Contracting Officer a written proposed 
maintenance program, including a maintenance records system, in 
sufficient detail to show its adequacy. If the Contracting Officer 
agrees to the proposed program, it shall become the normal maintenance 
obligation of the Contractor. The Contractor's performance according to 
the approved program shall satisfy the Contractor's obligations under 
subparagraphs (h)(1) and (h)(5) of this clause.
    (3) The Contracting Officer may at any time direct the Contractor in 
writing to reduce the work required by the normal maintenance program. 
If such order reduces the cost of performing the maintenance, an 
appropriate equitable adjustment may be made in any affected related 
contract that so provides.
    (4) The Contractor shall perform any maintenance work directed by 
the Contracting Officer in writing. Work in excess of the maintenance 
required under subparagraphs (h)(1) through (h)(3) of this clause shall 
be at Government expense. The Contractor shall notify the Contracting 
Officer in writing when sound industrial practice requires maintenance 
in excess of the normal maintenance program.
    (5) The Contractor shall keep records of all work done on the 
facilities and shall give the Government reasonable opportunity to 
inspect these records. When facilities are disposed of under this 
contract, the Contractor shall deliver the related records to the 
Government or, if the Contracting Officer directs, to third persons.
    (6) The Contractor's obligation under this clause for each item of 
facilities shall continue until the item is removed, abandoned, or 
disposed of; until the expiration of the 120-day period stated in 
subparagraph (n)(4) of this clause; and until the Contractor has 
discharged its other obligations under this contract with respect to 
such items.
    (i) Access. The Government and any persons designated by it shall, 
at all reasonable times, have access to the premises where any of the 
facilities are located.
    (j) Indemnification of the Government. The Contractor shall 
indemnify the Government and hold it harmless against claims for injury 
to persons or damage to property of the Contractor or others arising 
from the Contractor's possession or use of the facilities, except as 
specified in the clause at FAR 52.228-7, Insurance--Liability to Third 
Persons. However, the provisions of the Contractor's related contracts 
shall govern any assumption of liability by the Government for claims 
arising under those contracts.
    (k) Late delivery, diversion, and substitution. (1) The Government 
shall not be liable for breach of contract for any delay in delivery or 
nondelivery of facilities to be furnished under this contract.
    (2) The Government has the right, at its expense, to divert the 
facilities under this contract by directing the Contractor to--
    (i) Deliver any of the facilities to locations other than those 
specified in the Schedule; or
    (ii) Assign purchase orders or subcontracts for any of the 
facilities to the Government or third parties.
    (3) The Government may furnish any facilities instead of having the 
Contractor acquire or construct them. In such event, the Contractor is 
entitled to reimbursement for the cost related to the acquisition or 
construction of the facilities, including the cost of terminating 
purchase orders and subcontracts.
    (4) Appropriate equitable adjustment may be made in any related 
contract that so provides and that is affected by any nondelivery, 
delay, diversion, or substitution under this paragraph (k).
    (l) Representations and warranties. (1) The Government makes no 
warranty, express or implied, regarding the condition or fitness for use 
of any facilities. To the extent practical, the Contractor shall be 
allowed to inspect all the facilities to be furnished by the Government 
before their shipment.
    (2) If the Contractor receives facilities in a condition not 
suitable for the intended use, the Contractor shall, within 30 days 
after receipt and installation thereof, so notify the Contracting 
Officer, detailing the facts and, as directed by the Contracting Officer 
and at Government expense, either (i) return such

[[Page 308]]

item or otherwise dispose of it or (ii) effect repairs or modifications. 
An appropriate equitable adjustment may be made in any related contract 
that so provides and that is affected by the return, disposition, 
repair, or modification of any facilities.
    (m) Termination of the use of the facilities. (1) The Contractor may 
at any time, upon written notice to the Contracting Officer, terminate 
its authority to use any or all of the facilities. Termination under 
this paragraph (m) shall not relieve the Contractor of any of its 
obligations or liabilities under any related contract or subcontract 
affected by the termination.
    (2) The Contracting Officer may at any time, upon written notice, 
terminate or limit the Contractor's authority to use any of the 
facilities. Except as otherwise provided in the Failure to Perform 
clause of this contract, an equitable adjustment may be made in any 
related contract of the Contractor that so provides and that is affected 
by such notice.
    (n) Disposition of the facilities. (1) The provisions of this 
paragraph (n) shall apply to facilities for which use has been 
terminated by either the Contracting Officer or the Contractor under 
paragraph (m), except as provided in subparagraph (n)(2).
    (2) Unless otherwise directed by the Contracting Officer, this 
paragraph shall not apply to facilities terminated by the Contractor 
if--
    (i) The facilities terminated do not comprise all of the facilities 
in the possession of the Contractor; and
    (ii) The Contracting Officer determines that continued retention of 
the facilities will not interfere with the Contractor's operations.
    (3) Within 60 days after the effective date of any notice of 
termination given under paragraph (m), or within such longer period as 
the Contracting Officer may approve in writing, the Contractor shall 
submit to the Contracting Officer, in a form satisfactory to the 
Contracting Officer, an accounting for all the facilities covered by the 
notice.
    (4) Within 120 days after the Contractor accounts for any facilities 
under subparagraph (n)(3), the Contracting Officer shall give written 
notice to the Contractor as to the disposition of the facilities, except 
as otherwise provided in subparagraph (n)(6). In its disposition of the 
facilities, the Government may either--
    (i) Abandon the facilities in place, in which case all obligations 
of the Government regarding such abandoned facilities and the 
restoration or rehabilitation of the premises in and on which they are 
located shall immediately cease; or
    (ii) Require the Contractor to comply, at Government expense, with 
such directions as the Contracting Officer may give with respect to--
    (A) The preparation, protection, removal, or shipment of the 
affected facilities;
    (B) The retention or storage of the affected facilities; provided, 
that the Contracting Officer shall not direct the Contractor to retain 
or store any items of facilities in or on real property not owned by the 
Government if such retention or storage will interfere with the 
Contractor's operations;
    (C) The restoration of Government-owned property incident to the 
removal of the facilities from such property; and
    (D) The sale of any affected facilities in such manner, at such 
times, and at such price as may be approved by the Government, except 
that the Contractor shall not be required to extend credit to any 
purchaser.
    (5) If the Contracting Officer fails to give the written notice 
required by subparagraph (n)(4) within the prescribed 120-day period, 
the Contractor may, upon not less than 30 days' written notice to the 
Government and at Government risk and expense, (i) retain the facilities 
in place or (ii) remove any of the affected severable facilities located 
in Contractor-owned property and store them at the Contractor's plant or 
in a public insured warehouse, in accordance with sound practice and in 
a manner compatible with their security classification. Except as 
provided in this subparagraph, the Government shall not be liable to the 
Contractor for failure to give the written notice required by 
subparagraph (n)(4).
    (6) Nonseverable items of the facilities or items of the facilities 
subject to patent or proprietary rights shall be disposed of in such 
manner as the parties may have agreed to in writing.
    (7) The Government, either directly or by third persons engaged by 
it, may remove or otherwise dispose of any facilities for which the 
Contractor's authority to use has been terminated, other than those for 
which specific provision is made in subparagraph (n)(6).
    (8) The Contractor shall, within a reasonable time after the 
expiration of the 120-day period specified in subparagraph (n)(4), 
remove all of its property from the Government property and take such 
action as the Contracting Officer may direct in writing with respect to 
restoring that Government property (to the extent that it is affected by 
the installation of the Contractor's property) to its condition before 
such installation.
    (9) Unless otherwise specifically provided in this contract, the 
Government shall not be obligated to the Contractor to restore or 
rehabilitate any property at the Contractor's plant, except for 
restoration or rehabilitation costs caused by removal of the facilities 
under subdivision (n)(4)(ii). The Contractor agrees to indemnify the 
Government against all suits or claims for damages arising out of

[[Page 309]]

the Government's failure to restore or rehabilitate any property at the 
Contractor's plant or property of its subcontractors, except any damage 
as may be caused by the negligence of the Government, its agents, or 
independent contractors.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 2640, Jan. 26, 1996]



Sec.  52.245-8  Liability for the Facilities.

    As prescribed in 45.302-6(b), insert the following clause:

                 Liability for the Facilities (JAN 1997)

    (a) The term Contractor's managerial personnel, as used in this 
clause, means any of the Contractor's directors, officers, managers, 
superintendents, or equivalent representatives who have supervision or 
direction of--
    (1) All or substantially all of the Contractor's business;
    (2) All or substantially all of the Contractor's operations at any 
one plant or separate location in which the facilities are installed or 
located; or
    (3) A separate and complete major industrial operation in connection 
with which the facilities are used.
    (b) The Contractor shall not be liable for any loss or destruction 
of, or damage to, the facilities, or for expenses incidental to such 
loss, destruction, or damage, except as provided in this clause.
    (c) The Contractor shall be liable for loss or destruction of, or 
damage to, the facilities, and for expenses incidental to such loss, 
destruction, or damage--
    (1) That results from a risk expressly required to be insured under 
this contract, but only to the extent of the insurance required to be 
purchased and maintained, or to the extent of insurance actually 
purchased and maintained, whichever is greater;
    (2) That results from a risk that is in fact covered by insurance or 
for which the Contractor is otherwise reimbursed, but only to the extent 
of such insurance or reimbursement;
    (3) For which the Contractor is otherwise responsible under the 
express terms of this contract;
    (4) That results from willful misconduct or lack of good faith on 
the part of the Contractor's managerial personnel; or
    (5) That results from a failure, due to willful misconduct or lack 
of good faith on the part of the Contractor's managerial personnel--
    (i) To establish, maintain, and administer a system for control of 
the facilities in accordance with the Property administration paragraph 
of the Government Property clause; or
    (ii) To maintain and administer a program for maintenance, repair, 
protection, and preservation of the facilities, in accordance with the 
Property administration paragraph of the Government Property clause, or 
to take reasonable steps to comply with any appropriate written 
direction that the Contracting Officer may prescribe as reasonably 
necessary for the protection of the facilities. If the Government 
Property clause does not include the Property administration paragraph, 
then the Contractor shall exercise sound industrial practice in 
complying with the requirements of this subdivision (c)(5)(ii).
    (d)(1) If the Contractor fails to act as provided by subparagraph 
(c)(5) above, after being notified (by certified mail addressed to one 
of the Contractor's managerial personnel) of the Government's 
disapproval, withdrawal of approval, or nonacceptance of the system or 
program, it shall be conclusively presumed that such failure was due to 
willful misconduct or lack of good faith on the part of the Contractor's 
managerial personnel.
    (2) Furthermore, any loss or destruction of, or damage to, the 
Government property shall be presumed to have resulted from such failure 
unless the Contractor can establish by clear and convincing evidence 
that such loss, destruction, or damage--
    (i) Did not result from the Contractor's failure to maintain an 
approved program or system; or
    (ii) Occurred while an approved program or system was maintained by 
the Contractor.
    (e) If the Contractor transfers facilities to the possession and 
control of a subcontractor, the transfer shall not affect the liability 
of the Contractor for loss or destruction of, or damage to, the 
facilities. However, the Contractor shall require the subcontractor to 
assume the risk of, and be responsible for, any loss or destruction of, 
or damage to, the facilities while in the subcontractor's possession or 
control, except to the extent that the subcontract, with the advance 
approval of the Contracting Officer, relieves the subcontractor from 
such liability. In the absence of such approval, the subcontract shall 
contain appropriate provisions requiring the return of all the 
facilities in as good condition as when received, except for reasonable 
wear and tear or for their utilization in accordance with the provisions 
of the prime contract.
    (f) Unless expressly directed in writing by the Contracting Officer, 
the Contractor shall not include in the price or cost under any contract 
with the Government the cost of insurance (including self-insurance) 
against any form of loss, destruction, or damage to the facilities. Any 
insurance required under this clause shall be in such form, in such 
amounts, for such periods of time, and with

[[Page 310]]

such insurers (including the Contractor as self-insurer in appropriate 
circumstances) as the Contracting Officer shall require or approve. Such 
insurance shall provide for 30 days advance notice to the Contracting 
Officer, in the event of cancellation or material change in the policy 
coverage on the part of the insurer. Documentation of insurance or an 
authenticated copy of such insurance shall be deposited promptly with 
the Contracting Officer. The Contractor shall, not less than 30 days 
before the expiration of such insurance, deliver to the Contracting 
Officer documentation of insurance or an authenticated copy of each 
renewal policy. The insurance shall be in the name of the United States 
of America (Agency Name), the Contractor, and such other interested 
parties as the Contracting Officer shall approve, and shall contain a 
loss payable clause reading substantially as follows:

Any loss under this policy shall be adjusted with (Contractor) and the 
proceeds, at the direction of the Government, shall be paid to 
(Contractor). Proceeds not paid to (Contractor) shall be paid to the 
office designated by the Contracting Officer.

    (g) When there is any loss or destruction of, or damage to, the 
facilities--
    (1) The Contractor shall promptly notify the Contracting Officer 
and, with the assistance of the Contracting Officer, shall take all 
reasonable steps to protect the facilities from further damage, separate 
the damaged and undamaged facilities, put all the facilities in the best 
possible order, and promptly furnish to the Contracting Officer (and in 
any event within 30 days) a statement of--
    (i) The facilities lost or damaged;
    (ii) The time and origin of the loss or damage;
    (iii) All known interests in commingled property of which the 
facilities are a part; and
    (iv) Any insurance covering any part of or interest in such 
commingled property;
    (2) The Contractor shall make such repairs, replacements, and 
renovations of the lost, destroyed, or damaged facilities, or take such 
other action as the Contracting Officer may direct in writing; and
    (3) The Contractor shall perform its obligations under this 
paragraph (g) at Government expense, except to the extent that the 
Contractor is liable for such damage, destruction, or loss under the 
terms of this clause, and except as any damage, destruction, or loss is 
compensated by insurance.
    (h) The Government is not obliged to replace or repair the 
facilities that have been lost, destroyed, or damaged. If the Government 
does not replace or repair the facilities, the right of the parties to 
an equitable adjustment in delivery or performance dates, price, or 
both, and in any other contractual condition of the related contracts 
affected shall be governed by the terms and conditions of those 
contracts.
    (i) Except to the extent of any loss or destruction of, or damage 
to, the facilities for which the Contractor is relieved of liability, 
the facilities shall be returned to the Government or otherwise disposed 
of under the terms of this contract (1) in as good condition as when 
received by the Contractor, (2) improved, or (3) as required under the 
terms of this contract, less ordinary wear and tear.
    (j) If the Contractor is in any way compensated (excepting proceeds 
from use and occupancy insurance, the cost of which is not borne 
directly or indirectly by the Government) for any loss or destruction 
of, or damage to, the facilities, the Contractor, as directed by the 
Contracting Officer, shall--
    (1) Use the proceeds to repair, renovate, or replace the facilities 
involved; or
    (2) Pay such proceeds to the Government.
    (k) The Contractor shall do nothing to prejudice the Government's 
right to recover against third parties for any loss or destruction of, 
or damage to, the facilities. Upon the request of the Contracting 
Officer, the Contractor shall furnish to the Government, at Government 
expense, all reasonable assistance and cooperation (including the 
prosecution of suit and the execution of instruments of assignment in 
favor of the Government) in obtaining recovery.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 62 FR 239, Jan. 2, 1997]



Sec.  52.245-9  Use and Charges.

    As prescribed in 45.302-6(c), insert the following clause in 
solicitations and contracts (1) when a consolidated facilities contract 
or a facilities use contract or (2) when a fixed-price contract is 
contemplated, and Government production and research property is 
provided other than on a rent-free basis. If the conditions specified in 
45.403(a) apply, the contracting officer shall modify the clause, as 
appropriate.

                       Use and Charges (APR 1984)

    (a) The Contractor may use the facilities without charge in the 
performance of--
    (1) Contracts with the Government that specifically authorize such 
use without charge;
    (2) Subcontracts of any tier under Government prime contracts if the 
Contracting Officer having cognizance of the prime contract (i) approves 
a subcontract specifically authorizing such use or (ii) otherwise 
authorizes such use in writing; and

[[Page 311]]

    (3) Other work, if the Contracting Officer specifically authorizes 
in writing use without charge for such work.
    (b) If granted written permission by the Contracting Officer, or if 
it is specifically provided for in the Schedule, the Contractor may use 
the facilities for a rental fee for work other than that provided in 
paragraph (a). Authorizing such use of the facilities does not waive any 
rights of the Government to terminate the Contractor's right to use the 
facilities. The rental fee shall be determined in accordance with the 
following paragraphs.
    (c) The following bases are or shall be established in writing for 
the rental computation prescribed in paragraphs (d) and (e) below in 
advance of any use of the facilities on a rental basis:
    (1) The rental rates shall be those set forth in Table I.
    (2) The acquisition cost of the facilities shall be the total cost 
to the Government, as determined by the Contracting Officer, and 
includes the cost of transportation and installation, if borne by the 
Government.
    (i) When Government-owned special tooling or accessories are rented 
with any of the facilities, the acquisition cost of the facilities shall 
be increased by the total cost to the Government of such tooling or 
accessories, as determined by the Contracting Officer.
    (ii) When any of the facilities are substantially improved at 
Government expense, the acquisition cost of the facilities shall be 
increased by the increase in value that the improvement represents, as 
determined by the Contracting Officer.
    (iii) The determinations of the Contracting Officer under this 
subparagraph (c)(2) shall be final.
    (3) For the purpose of determining the amount of rental due under 
paragraph (d), the rental period shall be not less than 1 month nor more 
than 6 months, as approved by the Contracting Officer.
    (4) For the purpose of computing any credit under paragraph (e), the 
unit in determining the amount of use of the facilities shall be direct 
labor hours, sales, hours of use, or any other unit of measure that will 
result in an equitable apportionment of the rental charge, as approved 
by the Contracting Officer.
    (d) The Contractor shall compute the amount of rentals to be paid 
for each rental period by applying the appropriate rental rates to the 
acquisition cost of such facilities as may have been authorized for use 
in advance for the rental period.
    (e) The full rental charge for each period shall be reduced by a 
credit. The credit equals the rental amount that would otherwise be 
properly allocable to the work for which the facilities were used 
without charge under paragraph (a). The credit shall be computed by 
multiplying the full rental for the rental period by a fraction in which 
the numerator is the amount of use of the facilities by the Contractor 
without charge during the period, and the denominator is the total 
amount of use of the facilities by the Contractor during the period.
    (f) Within 90 days after the close of each rental period, the 
Contractor shall submit to the Contracting Officer a written statement 
of the use made of the facilities by the Contractor and the rental due 
the Government. At the same time, the Contractor shall make available 
such records and data as are determined by the Contracting Officer to be 
necessary to verify the information contained in the statement.
    (g) If the Contractor fails to submit the information as required in 
paragraph (f) above, the Contractor shall be liable for the full rental 
for the period. However, if the Contractor's failure to submit was not 
the fault of the Contractor, the Contracting Officer shall grant to the 
Contractor in writing a reasonable extension of time to submit.
    (h) Unless otherwise directed in writing by the Contracting Officer, 
the Contractor shall give priority in the use of the facilities to 
performing contracts and subcontracts of the Contracting Officer having 
cognizance of the facilities and shall not undertake any work involving 
the use of the facilities that would interfere with performing existing 
Government contracts or subcontracts.
    (i) Concurrently with the submission of the written statement 
prescribed by paragraph (f) of this clause, the Contractor shall pay the 
rental due the Government under this clause. Payment shall be by check 
made payable to the office designated for contract administration and 
mailed or delivered to the Contracting Officer. Receipt and acceptance 
by the Government of the Contractor's check pursuant to this paragraph 
shall constitute an accord and satisfaction of the final amount due the 
Government hereunder, unless the Contractor is notified in writing 
within 180 days following receipt that the amount received is not 
regarded by the Government as the final amount due.
    (j) If the Contractor uses any item of the facilities without 
authorization, the Contractor shall be liable for the full monthly 
rental, without credit, for such item for each month or part of a month 
in which such unauthorized use occurs; provided, however, that the 
agency head concerned may, in writing, waive the Contractor's liability 
for such unauthorized use if the agency head determines that without 
such a waiver gross inequity would result. The acceptance of any rental 
by the Government under this clause shall not be construed as a waiver 
or relinquishment of any rights it may have against the Contractor 
growing out of the Contractor's unauthorized use of the facilities or 
any

[[Page 312]]

other failure to perform this contract according to its terms.

                                 Table I

                              Rental Rates

    (i) For real property and associated fixtures, a fair and reasonable 
rental shall be established, based on sound commercial practice.
    (ii) For plant equipment of the types covered in Federal Supply 
classes 3405, 3408, 3410, and 3411 through 3419, machine tools; and in 
3441 through 3449, secondary metal forming and cutting machines, the 
following monthly rates shall apply:

------------------------------------------------------------------------
                                                              Monthly
                     Age of Equipment                       Rental Rate
------------------------------------------------------------------------
Under 2 years old........................................  3.0 percent
Over 2 to 3 years old....................................  2.0 percent
Over 3 to 6 years old....................................  1.5 percent
Over 6 to 10 years old...................................  1.0 percent
Over 10 years old........................................  0.75 percent
------------------------------------------------------------------------

The age of each item of the equipment shall be based on the year in 
which it was manufactured, with a birthday on January 1 of each year 
thereafter. For example, an item of equipment manufactured on July 15, 
1978, will be considered to be over 1 year old on and after January 1, 
1979, and over 2 years old on and after January 1, 1980.
    (iii) For personal property and equipment not covered in (i) or (ii) 
above, a rental shall be established at not less than the prevailing 
commercial rate, if any, or, in the absence of such rate, not less than 
2 percent per month for electronic test equipment and automotive 
equipment and not less than 1 percent per month for all other property 
and equipment.

                             (End of clause)



Sec.  52.245-10  Government Property (Facilities Acquisition).

    As prescribed in 45.302-6(d), insert the following clause in 
solicitations and contracts when a facilities acquisition contract is 
contemplated:

         Government Property (Facilities Acquisition) (MAR 1996)

    (a) Definitions.
    Facilities, as used in this clause, means all property provided 
under this facilities contract.
    Related contract, as used in this clause, means a Government 
contract or subcontract for supplies or services under which the use of 
the facilities is or may be authorized.
    (b) Facilities to be provided. (1) The Contractor, at Government 
expense and subject to the provisions of this contract, shall acquire, 
construct, or install the facilities and perform the related work as 
described in the Schedule.
    (2) The Government, subject to the provisions of this contract, 
shall furnish to the Contractor the facilities identified in the 
Schedule as Government-furnished facilities. The Contractor, at 
Government expense, shall perform the work with respect to those 
Government-furnished facilities as is described in the Schedule.
    (c) Title in the facilities. (1) The Government shall retain title 
to all Government-furnished property.
    (2) Title to all facilities and components shall pass to and vest in 
the Government upon delivery by the vendor of all such items purchased 
by the Contractor for which it is entitled to be reimbursed as a direct 
item of cost under this contract.
    (3) Title to other property, the cost of which is reimbursable to 
the Contractor under this contract, shall pass to and vest in the 
Government upon--
    (i) Issuance of the property for use in performing this contract;
    (ii) Commencement of processing or use of the property in performing 
this contract; or
    (iii) Reimbursement of the cost of the property by the Government, 
whichever occurs first.
    (4) Title to the facilities shall not be affected by their 
incorporation into, or attachment to, any property not owned by the 
Government, nor shall any item of the facilities become a fixture or 
lose its identity as personal property by being attached to any real 
property. The Contractor shall keep the facilities free and clear of all 
liens and encumbrances and, except as otherwise authorized by this 
contract or by the Contracting Officer, shall not remove or otherwise 
part with possession of, or permit the use by others of, any of the 
facilities.
    (5) The Contractor may, with the written approval of the Contracting 
Officer, install, arrange, or rearrange, on Government-furnished 
premises, readily movable machinery, equipment, and other items 
belonging to the Contractor. Title to any such item shall remain in the 
Contractor even though it may be attached to real property owned by the 
Government, unless the Contracting Officer determines that it is so 
permanently attached that removal would cause substantial injury to 
Government property.
    (6) The Contractor shall not construct or install, at its own 
expense, any fixed improvement or structural alterations in Government 
buildings or other real property without advance written approval of the 
Contracting Officer. Fixed improvement, or structural alterations, as 
used herein, means any alteration or improvement in the nature of the 
building or other real property, that, after completion, cannot be 
removed without substantial loss of value or damage to the

[[Page 313]]

premises. The term does not include foundations for production 
equipment.
    (d) Property control. The Contractor shall maintain property control 
procedures and records and a system of identification of the facilities 
in accordance with the provisions of Federal Acquisition Regulation 
(FAR) subpart 45.5 in effect on the date of this contract. The 
provisions of FAR 45.5 are hereby incorporated by reference and made a 
part of this contract.
    (e) Access. The Government and any persons designated by it shall, 
at all reasonable times, have access to the premises where any of the 
facilities are located.
    (f) Indemnification of the Government. The Contractor shall 
indemnify the Government and hold it harmless against claims for injury 
to persons or damage to property of the Contractor or others arising 
from the Contractor's possession or use of the facilities, except as 
specified in the clause at FAR 52.228-7, Insurance--Liability to Third 
Persons. However, the provisions of the Contractor's related contracts 
shall govern any assumption of liability by the Government for claims 
arising under such related contracts.
    (g) Late delivery, diversion, and substitution. (1) The Government 
shall not be liable for breach of contract for any delay in delivery or 
nondelivery of facilities to be furnished under this contract.
    (2) The Government has the right, at its expense, to divert the 
facilities under this contract by directing the Contractor to--
    (i) Deliver any of the facilities to locations other than those 
specified in the Schedule; or
    (ii) Assign purchase orders or subcontracts for any of the 
facilities to the Government or third parties.
    (3) The Government may furnish any facilities instead of having the 
Contractor acquire or construct them. In such event, the Contractor is 
entitled to reimbursement for the cost related to the acquisition or 
construction of the facilities, including the cost of terminating 
purchase orders and subcontracts.
    (4) Appropriate equitable adjustment may be made in any related 
contract that so provides and that is affected by nondelivery, delay, 
diversion, or substitution under this paragraph (g).
    (h) Representations and warranties. (1) The Government makes no 
warranty, express or implied, regarding the condition or fitness for use 
of any facilities. To the extent practical, the Contractor shall be 
allowed to inspect all the facilities to be furnished by the Government 
before their shipment.
    (2) If the Contractor receives facilities in a condition not 
suitable for the intended use, the Contractor shall, within 30 days 
after receipt and installation thereof, so notify the Contracting 
Officer, detailing the facts, and, as directed by the Contracting 
Officer and at Government expense, either (i) return such item or 
otherwise dispose of it or (ii) effect repairs or modifications. An 
appropriate equitable adjustment may be made in any related contract 
that so provides and that is affected by the return, disposition, 
repair, or modification of any facilities.
    (i) Supersedure. Upon the acquisition, construction, or installation 
of the facilities called for by this contract, or any usable increment 
of the facilities, and acceptance by the Government, the facilities 
shall then be subject to the provisions of the facilities contract that 
authorizes the use of the items.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 2640, Jan. 26, 1996]



Sec.  52.245-11  Government Property (Facilities Use).

    As prescribed in 45.302-6(e)(1), insert the following clause:

             Government Property (Facilities Use) (APR 1984)

    (a) Definitions. Facilities, as used in this clause, means property 
provided under this facilities contract.
    Related contract, as used in this clause, means a Government 
contract or subcontract for supplies or services under which the use of 
the facilities is or may be authorized.
    (b) Period of this contract. If not otherwise specified in this 
contract and if not previously terminated under paragraph (k), the use 
of the facilities authorized under this contract shall terminate 5 years 
after its effective date. Thereafter, if continued use of the facilities 
by the Contractor is mutually desired, the parties shall enter into a 
new contract that shall incorporate such provisions as may then be 
required by applicable laws and regulations. The parties may, by written 
agreement, extend the use of the facilities under this contract beyond 
this 5-year period to permit the completion of any then-existing related 
contracts and subcontracts.
    (c) Title in the facilities. (1) Title to the facilities shall 
remain in the Government. Title to parts replaced by the Contractor in 
carrying out its normal maintenance obligations under paragraph (g) 
shall pass to and vest in the Government upon completion of their 
installation in the facilities.
    (2) Title to the facilities shall not be affected by their 
incorporation into or attachment to any property not owned by the 
Government, nor shall any item of the facilities become a fixture or 
lose its identity as personal property by being attached to any real

[[Page 314]]

property. The Contractor shall keep the facilities free and clear of all 
liens and encumbrances and, except as otherwise authorized by this 
contract or by the Contracting Officer, shall not remove or otherwise 
part with possession of, or permit the use by others of, any of the 
facilities.
    (3) The Contractor may, with the written approval of the Contracting 
Officer, install, arrange, or rearrange, on Government-furnished 
premises, readily movable machinery, equipment, and other items 
belonging to the Contractor. Title to any such item shall remain in the 
Contractor even though it may be attached to real property owned by the 
Government, unless the Contracting Officer determines that it is so 
permanently attached that removal would cause substantial injury to 
Government property.
    (4) The Contractor shall not construct or install, at its own 
expense, any fixed improvement or structural alterations in Government 
buildings or other real property without advance written approval of the 
Contracting Officer. Fixed improvement or structural alterations, as 
used herein, means any alteration or improvement in the nature of the 
building or other real property that, after completion, cannot be 
removed without substantial loss of value or damage to the premises. The 
term does not include foundations for production equipment.
    (d) Location of the facilities. The Contractor may use the 
facilities at any of the locations specified in the Schedule and, with 
the prior written approval of the Contracting Officer, at any other 
location. In granting this approval, the Contracting Officer may 
prescribe such terms and conditions as may be deemed necessary for 
protecting the Government's interest in the facilities involved. Those 
terms and conditions shall take precedence over any conflicting 
provisions of this contract.
    (e) Notice of use of the facilities. The Contractor shall notify the 
Contracting Officer in writing--
    (1) Whenever use of all facilities for Government work in any 
quarterly period averages less than 75 percent of the total use of the 
facilities; or
    (2) Whenever any item of the facilities is no longer needed or 
usable for performing existing related contracts that authorize such 
use.
    (f) Property control. The Contractor shall maintain property control 
procedures and records, and a system of identification of the 
facilities, in accordance with the provisions of Federal Acquisition 
Regulation (FAR) subpart 45.5 in effect on the date of this contract. 
The provisions of FAR 45.5 are hereby incorporated by reference and made 
a part of this contract.
    (g) Maintenance. (1) Except as otherwise provided in the Schedule, 
the Contractor shall protect, preserve, maintain (including normal parts 
replacement), and repair the facilities in accordance with sound 
industrial practice.
    (2) As soon as practicable after the execution of this contract, the 
Contractor shall submit to the Contracting Officer a written proposed 
maintenance program, including a maintenance records system, in 
sufficient detail to show the adequacy of the proposed program. If the 
Contracting Officer agrees to the proposed program, it shall become the 
normal maintenance obligation of the Contractor. The Contractor's 
performance according to the approved program shall satisfy the 
Contractor's obligations under subparagraphs (g)(1) and (g)(5) of this 
clause.
    (3) The Contracting Officer may at any time direct the Contractor in 
writing to reduce the work required by the normal maintenance program. 
If such order reduces the cost of performing the maintenance, an 
appropriate equitable adjustment may be made in any affected related 
contract that so provides.
    (4) The Contractor shall perform any maintenance work directed by 
the Contracting Officer in writing. Work in excess of the maintenance 
required under subparagraphs (g)(1) through (g)(3) of this clause shall 
be at Government expense. The Contractor shall notify the Contracting 
Officer in writing when sound industrial practice requires maintenance 
in excess of the normal maintenance program.
    (5) The Contractor shall keep records of all work done on the 
facilities and shall give the Government reasonable opportunity to 
inspect such records. When facilities are disposed of under this 
contract, the Contractor shall deliver the related records to the 
Government or, if directed by the Contracting Officer, to third persons.
    (6) The Contractor's obligation under this clause for each item of 
facilities shall continue until the item is removed, abandoned, or 
disposed of at the expiration of the 120-day period stated in 
subparagraph (l)(4) of this clause and when the Contractor has 
discharged its other obligations under this contract with respect to 
such items.
    (h) Access. The Government and any persons designated by it shall, 
at all reasonable times, have access to the premises where any of the 
facilities are located.
    (i) Indemnification of the Government. The Contractor shall 
indemnify the Government and hold it harmless against claims for injury 
to persons or damage to property of the Contractor or others arising 
from the Contractor's possession or use of the facilities under this 
contract. However, the provisions of the Contractor's related contracts 
shall govern any assumption of liability by the Government for claims 
arising under those contracts.
    (j) Representations and warranties. (1) The Government makes no 
warranty, express or

[[Page 315]]

implied, regarding the condition or fitness for use of any facilities. 
To the extent practical, the Contractor shall be allowed to inspect all 
the facilities to be furnished by the Government before their shipment.
    (2) If the Contractor receives facilities in a condition not 
suitable for the intended use, the Contractor shall, within 30 days 
after receipt and installation thereof, so notify the Contracting 
Officer, detailing the facts, and, as directed by the Contracting 
Officer and at Government expense, either (i) return such item or 
otherwise dispose of it or (ii) effect repairs or modifications. An 
appropriate equitable adjustment may be made in any related contract 
that so provides and that is affected by the return, disposition, 
repair, or modification of any facilities.
    (k) Termination of use of the facilities. (1) The Contractor may at 
any time, upon written notice to the Contracting Officer, terminate its 
authority to use any or all of the facilities. Termination under this 
paragraph (k) shall not relieve the Contractor of any of its obligations 
or liabilities under any related contract or subcontract affected by the 
termination.
    (2) The Contracting Officer may at any time, upon written notice, 
terminate or limit the Contractor's authority to use any of the 
facilities. Except as otherwise provided in the Failure to Perform 
clause of this contract, an equitable adjustment may be made in any 
related contract of the Contractor that so provides and that is affected 
by such notice.
    (l) Disposition of the facilities. (1) The provisions of this 
paragraph (l) shall apply to facilities whose use has been terminated by 
either the Contracting Officer or the Contractor under paragraph (k), 
except as provided in subparagraph (l)(2).
    (2) Unless otherwise directed by the Contracting Officer, this 
paragraph (l) shall not apply to facilities terminated by the Contractor 
if--
    (i) The facilities terminated do not comprise all of the facilities 
in the possession of the Contractor; and
    (ii) The Contracting Officer determines that continued retention of 
the facilities will not interfere with the Contractor's operations.
    (3) Within 60 days after the effective date of any notice of 
termination given under paragraph (k) or within such longer period as 
the Contracting Officer may approve in writing, the Contractor shall 
submit to the Contracting Officer an accounting for all the facilities 
covered by such notice. The submission of the Contractor shall be in a 
form satisfactory to the Contracting Officer.
    (4) Within 120 days after the Contractor accounts for any facilities 
under subparagraph (l)(3), the Contracting Officer shall give written 
notice to the Contractor as to the disposition of the facilities, except 
as otherwise provided in subparagraph (l)(6). In its disposition of the 
facilities, the Government may either--
    (i) Abandon the facilities in place, in which case all obligations 
of the Government regarding such abandoned facilities and the 
rehabilitation of the premises in and on which they are located shall 
immediately cease; or
    (ii) Require the Contractor to comply, at Government expense, with 
such directions as the Contracting Officer may give with respect to--
    (A) The preparation, protection, removal, or shipment of the 
affected facilities;
    (B) The retention or storage of the affected facilities; provided, 
that the Contracting Officer shall not direct the Contractor to retain 
or store any items of facilities in or on real property not owned by the 
Government if such retention or storage will interfere with the 
Contractor's operations;
    (C) The restoration of Government-owned property incident to the 
removal of the facilities from such property; and
    (D) The sale of any affected facilities in such manner, at such 
times, and at such price as may be approved by the Government, except 
that the Contractor shall not be required to extend credit to any 
purchaser.
    (5) If the Contracting Officer fails to give the written notice 
required by subparagraph (l)(4) of this clause within the prescribed 
120-day period, the Contractor may, upon not less than 30 days' written 
notice to the Government, and at Government risk and expense, (i) retain 
the facilities in place or (ii) remove any of the affected severable 
facilities located in Contractor-owned property and store them at the 
Contractor's plant or in a public insured warehouse. Such removal and 
storage shall be in accordance with sound practice and in a manner 
compatible with the security classification of the facilities. Except as 
provided in this subparagraph (l)(5), the Government shall not be liable 
to the Contractor for failure to give the written notice required by 
subparagraph (l)(4).
    (6) Nonseverable items of the facilities or items of the facilities 
subject to patent or proprietary rights shall be disposed of in such 
manner as the parties may have agreed to in writing.
    (7) The Government, either directly or by third persons engaged by 
it, may remove or otherwise dispose of any facilities for which the 
Contractor's authority to use has been terminated, other than those for 
which specific provision is made in subparagraph (l)(6).
    (8) The Contractor shall, within a reasonable time after the 
expiration of the 120-day period specified in subparagraph (l)(4), 
remove all of its property from the Government property and take such 
action as the Contracting Officer may direct in writing with respect to 
restoring such Government property, to the extent that it is affected by

[[Page 316]]

the installation of the Contractor's property, to its condition before 
such installation.
    (9) Unless otherwise specifically provided in this contract, the 
Government shall not be obligated to the Contractor to restore or 
rehabilitate any property at the Contractor's plant, except for 
restoration or rehabilitation costs caused by removal of the facilities 
under subdivision (l)(4)(ii). The Contractor agrees to indemnify the 
Government against all suits or claims for damages arising out of the 
Government's failure to restore or rehabilitate any property at the 
Contractor's plant or property of its subcontractors, except any damage 
as may be caused by the negligence of the Government, its agents, or 
independent contractors.
    (m) Supersedure. (1) Facilities previously provided to the 
Contractor under the contracts specified in the Schedule of this 
contract shall become subject to this contract upon its effective date. 
The terms of those contracts by which such facilities were previously 
provided to the Contractor are hereby superseded with respect to such 
facilities, except for rights and obligations that may have accrued 
under such other contract before the effective date of this contract.
    (2) Facilities subsequently provided the Contractor under any 
contract shall, if that contract so specifies, be subject to this 
contract upon the completion of their construction, acquisition, and 
installation or upon their availability for use, whichever occurs first, 
except as otherwise provided in the contract or other document by which 
such facilities are provided to the Contractor.

                             (End of clause)

    Alternate I (June 2003). As prescribed in 45.302-6(e)(2), substitute 
the following paragraph (c) of the basic clause:

    (c) Title. (1) Title to equipment (and other tangible personal 
property) having a unit acquisition cost of less than $5,000, purchased 
with funds available for research, shall vest in the Contractor upon 
acquisition or as soon thereafter as feasible, provided that the 
Contractor received the Contracting Officer's approval before acquiring 
the equipment. Title to other equipment purchased with Government funds 
shall vest in the Government. The Government may at any time during the 
term of this contract or upon its completion or termination transfer to 
the Contractor the title to any equipment purchased with funds available 
for research. Any such transfer shall be upon terms and conditions 
agreed to by the parties. The Contractor agrees that it shall not charge 
under any Government contract or subcontract any depreciation, 
amortization, or use of the equipment purchased or transferred under 
this paragraph. When title to equipment is vested in the Contractor or 
is transferred under this paragraph to the Contractor, the equipment 
ceases to be Government property. Within 10 days after the end of the 
calendar quarter in which such acquisition or transfer of title occurs, 
the Contractor shall furnish the Contracting Officer a list of all 
equipment, title to which is vested in the Contractor.
    (2)(i) The Government shall retain title to all Government-furnished 
property.
    (ii) Except as set forth in subparagraph (c)(1), title to all 
property shall pass to and vest in the Government upon delivery by the 
vendor of all such items purchased by the Contractor for which it is 
entitled to be reimbursed as a direct item of cost under this or a 
related contract.
    (iii) Title to replacement parts furnished by the Contractor in 
performing its normal obligations under paragraph (g) shall pass to and 
vest in the Government upon completion of their installation in the 
facilities.
    (iv) Title to other property, the cost of which is reimbursable to 
the contractor under this contract or a related contract, shall pass to 
and vest in the Government upon--
    (A) Issuance of the property for use in performing this contract;
    (B) Commencement of processing or use of the property in performing 
this contract; or
    (C) Reimbursement of the cost of the property by the Government, 
whichever occurs first.
    (3) Title to the facilities shall not be affected by their 
incorporation into or attachment to any property not owned by the 
Government, nor shall any item of the facilities become a fixture or 
lose its identity as personal property by being attached to any real 
property. The Contractor shall keep the facilities free and clear of all 
liens and encumbrances and, except as otherwise authorized by this 
contract or by the Contracting Officer, shall not remove or otherwise 
part with possession of, or permit the use by others of, any of the 
facilities.
    (4) The Contractor may, with the written approval of the Contracting 
Officer, install, arrange, or rearrange, on Government-furnished 
premises, readily movable machinery, equipment, and other items 
belonging to the Contractor. Title to any such item shall remain in the 
Contractor even though it may be attached to real property owned by the 
Government, unless the Contracting Officer determines that it is so 
permanently attached that removal would cause substantial injury to 
Government property.
    (5) The Contractor shall not construct or install, at its own 
expense, any fixed improvement or structural alterations in Government 
buildings or other real property without advance written approval of the 
Contracting Officer. Fixed improvement, as

[[Page 317]]

used herein, means any alteration or improvement in the nature of the 
building or other real property that, after completion, cannot be 
removed without substantial loss of value or damage to the premises. The 
term does not include foundations for production equipment.
    (6) Vesting title under this paragraph (c) is subject to civil 
rights legislation, 42 U.S.C. 2000d. Before title is vested and by 
signing this contract, the Contractor accepts and agrees that--

No person in the United States or its outlying areas shall, on the 
ground of race, color, or national origin, be excluded from 
participation in, be denied the benefits of, or be otherwise subjected 
to discrimination under this contemplated financial assistance (title to 
equipment).

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 26904, June 28, 1985; 
68 FR 28087, May 22, 2003]



Sec.  52.245-12  Contract Purpose (Nonprofit Educational Institutions).

    As prescribed in 45.302-7(a), the contracting officer may insert the 
following clause in solicitations and contracts when a facilities use 
contract is contemplated and award may be made to a nonprofit 
educational institution:

    Contract Purpose (Nonprofit Educational Institutions) (APR 1984)

    This facilities use contract is designed specifically for nonprofit 
educational institutions to set forth provisions for the use and 
accountability of facilities furnished or acquired under related 
contracts identified elsewhere herein. There are no funds provided under 
this contract. Costs incurred for acquisition, maintenance, repair, 
replacement, disposition, or other purposes in connection with the 
facilities accountable hereunder will be subject to the reimbursement 
provisions of the related contracts; provided, however, that should no 
other contract be available for reimbursement of such costs, this 
contract may be appropriately modified to provide for such 
reimbursement.

                             (End of clause)



Sec.  52.245-13  Accountable Facilities (Nonprofit Educational Institutions).

    As prescribed in 45.302-7(b), the contracting officer may insert the 
following clause in solicitations and contracts when a facilities 
contract is contemplated and award may be made to a nonprofit 
educational institution:

 Accountable Facilities (Nonprofit Educational Institutions) (APR 1984)

    The facilities accountable under this contract are those facilities 
furnished or acquired under this contract and those facilities furnished 
or acquired under those related contracts that are specifically 
identified in this contract Schedule.

                             (End of clause)



Sec.  52.245-14  Use of Government Facilities.

    As prescribed in 45.302-7(c), the contracting officer may insert the 
following clause in solicitations and contracts when a facilities use 
contract is contemplated and award may be made to a nonprofit 
educational institution:

                 Use of Government Facilities (APR 1984)

    The Contractor may use the facilities without charge in performing--
    (a) Contracts with the Government which specifically authorize such 
use without charge;
    (b) Subcontracts of any tier if the Contracting Officer having 
cognizance of the prime contract has authorized, in writing, use without 
charge; and
    (c) Other work for which the Contracting Officer has specifically 
authorized use without charge in writing.

                             (End of clause)



Sec.  52.245-15  Transfer of Title to the Facilities.

    As prescribed in 45.302-7(d), insert the following clause:

             Transfer of Title to the Facilities (June 2003)

    (a) The Contracting Officer may, at any time during the term of this 
contract and acting under Public Law 97-258 (31 U.S.C. 6306), transfer 
title to equipment to the Contractor upon mutually agreeable terms and 
conditions. This clause takes precedence over the title paragraph of the 
Government property clause of this contract. However, every agreement to 
transfer title to equipment shall provide that the Contractor will not 
include in the contract price or charge the Government in any manner for 
depreciation, amortization, or use of such equipment.
    (b) Vesting title under paragraph (a) above is subject to civil 
rights legislation, 42 U.S.C. 2000d. Before title is vested and by 
signing this contract, the contractor accepts and agrees that--

No person in the United States or its outlying areas shall, on the 
ground of race, color, or national origin, be excluded from 
participation in,

[[Page 318]]

be denied the benefits of, or be otherwise subjected to discrimination 
under this contemplated financial assistance (title to equipment).

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 26905, June 28, 1985; 
68 FR 28087, May 22, 2003]



Sec.  52.245-16  Facilities Equipment Modernization.

    As prescribed in 45.302-7(e), insert the following clause:

              Facilities Equipment Modernization (APR 1985)

    (a) The Contractor agrees to return to the Government the net cost 
savings realized from using modernized or replacement equipment provided 
by the Government under this contract. This applies to using such 
equipment on any contracts or subcontracts that are firm-fixed price, or 
that are fixed-price with economic price adjustment provisions, entered 
into within the 3 years following the date such equipment is placed into 
production. This provision does not apply to the use of such equipment 
in sealed bid contracts entered into after the equipment is placed in 
production or in contracts or subcontracts that specifically provide 
that they have been priced on the basis of anticipated use of such 
equipment.
    (b)(1) The Contractor shall maintain adequate records for 
implementing this clause. The Contractor shall make such records 
available at its office for inspection, audit, or reproduction by any 
authorized representative of the Contracting Officer.
    (2) When the Contractor authorizes a subcontractor to use the 
modernized or replacement equipment, the subcontractor shall be required 
to maintain records and make them and additional information available 
to the Contracting Officer.
    (c) Records of equipment shall generally be acceptable if they are 
maintained under established accounting practices and permit a fair 
estimation of the net cost savings realized. Net cost savings realized 
shall be determined by a comparison of the Contractor's cost experience 
in the operation of the equipment before and after modernization.
    (d) Amounts due the Government under this clause shall be returned 
by the Contractor, as directed by the Contracting Officer, by--
    (1) Credits to, or adjustment of the prices of, the related 
contracts benefitting from using the modernized or replacement 
equipment;
    (2) Payment to the Government through the Contracting Officer having 
cognizance of the equipment; or
    (3) Any other means mutually agreed to.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 1748, Jan. 11, 1985; 
50 FR 52434, Dec. 23, 1985]



Sec.  52.245-17  Special Tooling.

    As prescribed in 45.306-5, insert the following clause:

                       Special Tooling (DEC 1989)

    (a) Definition. Special tooling means jigs, dies, fixtures, molds, 
patterns, taps, gauges, other equipment and manufacturing aids, all 
components of these items, and replacements of these items that are of 
such a specialized nature that without substantial modification or 
alteration their use is limited to the development or production of 
particular supplies or parts thereof or performing particular services. 
It does not include material, special test equipment, facilities (except 
foundations and similar improvements necessary for installing special 
tooling), general or special machine tools, or similar capital items. 
Special tooling for the purpose of this clause, includes all special 
tooling acquired or fabricated by the Contractor for the Government 
(other than special tooling to be delivered as a line item) or furnished 
by the Government for use in connection with and under the terms of the 
contract.
    (b) Title. The Government retains title to Government-owned special 
tooling and option to take title to all special tooling subject to this 
clause until such time as title or option to take title is relinquished 
by the Contracting Officer as provided for in subparagraphs (j)(2) and 
(j)(3) of this clause.
    (c) Risk of loss. Except to the extent that the Government shall 
have otherwise assumed the risk of loss to special tooling applicable to 
this clause, in the event of the loss, theft or destruction of or damage 
to any such property, the repair or replacement shall be accomplished by 
the Contractor at its own expense.
    (d) Special tooling furnished by the Government. (1) Except as 
otherwise provided in this contract, all Government-furnished special 
tooling is provided as is. The Government makes no warranty whatsoever 
with respect to special tooling furnished as is, except that the 
property is in the same condition when placed at the f.o.b. point 
specified in the solicitation as when last available for inspection by 
the Contractor under the solicitation.
    (2) The Contractor may repair any special tooling made available on 
an as is basis. Such repair will be at the Contractor's expense, except 
as otherwise provided in this clause. Such property may be modified as 
necessary for use under this contract at the

[[Page 319]]

Contractor's expense, except as otherwise directed by the Contracting 
Officer. Any repair or modification of property furnished as is shall 
not affect the title of the Government.
    (3) If there is any change in the condition of special tooling 
furnished as is from the time inspected or last available for inspection 
under the solicitation to the time placed on board at the location 
specified in the solicitation or the Government directs a change in the 
quantity of special tooling furnished or to be furnished, and such 
change will adversely affect the Contractor, the Contractor shall, upon 
receipt of the property, notify the Contracting Officer detailing the 
facts, and, as directed by the Contracting Officer, either (i) return 
such items at the Government's expense or otherwise dispose of the 
property or (ii) effect repair to return the property to its condition 
when inspected under the solicitation or, if not inspected, last 
available for inspection under the solicitation. After completing the 
directed action and upon written request of the Contractor, the 
Contracting Officer shall equitably adjust any contractual provisions 
affected by the return, disposition, or repair in accordance with 
procedures provided for in the Changes clause of this contract. The 
foregoing provisions for adjustment are the exclusive remedy available 
to the Contractor, and the Government shall not be otherwise liable for 
any delivery of special tooling in a condition or in quantities other 
than that when originally offered.
    (e) Use of special tooling. The Contractor may use special tooling 
subject to this clause on other Government effort when specifically 
approved in writing by the Contracting Officer for this contract and the 
Contracting Officer for the contract under which the special tooling 
will be used. Any other use of the special tooling shall be subject to 
advance written approval of the Contracting Officer. In the event the 
Government elects to remove any speical tooling that is required for 
continued contract performance, the contract shall be equitably adjusted 
in accordance with paragraph (m) of this clause.
    (f) Property control--(1) Records. The Contractor's special tooling 
records shall provide the following minimum information regarding each 
item of special tooling subject to this clause and shall be made 
available for Government inspection at all reasonable times:
    (i) Number or code of the contract to which the tooling is 
accountable and the number or code of the contract for which the tooling 
was originally acquired or fabricated.
    (ii) Retention codes as defined below:
    (A) Primary Code. Assign one of the following to each item of 
special tooling:
    Code A. Spares Tooling. Required to produce a provisioned spare part 
or assembly.
    Code B. Judgment (Insurance) Tooling. Fabrication tools for parts 
that are not provisioned spares but which in the judgment of the 
Contractor will be required at some time for logistic support of the end 
item.
    Code C. Rate Tooling. Necessary to economically produce at increased 
rates (e.g., for mobilization or surge) but not essential for parts 
fabrication at low production rates.
    Code D. Assembly Tooling. Required for manufacture of the end 
product but not required for production of spare parts. Those items 
having no postproduction need except for potential modification or 
resumed production programs.
    (B) Secondary Code. Assign one or more of the following codes, as 
applicable, to each item of special tooling:
    Code 1. Repair Tooling. Items which are capable of being used for 
repair of provisioned parts or assemblies.
    Code 2. Replaceable Tooling. Spares or judgment tooling (primary 
retention code A or B) which, in the opinion of the Contractor, can be 
effectively and economically replaced by soft tooling on an as required 
basis in lieu of retention of the hard production tooling for supporting 
postproduction requirements.
    Code 3. Maintenance Tooling. Items which are capable of being used 
for depot level maintenance of the applicable end item or components 
thereof.
    Code 4. Crash Damage Tooling. Items which apply to provisioned or 
nonprovisioned parts or assemblies which are designated as or have the 
potential of being required for crash damage repairs.
    (iii) Nomenclature, function, or comparable code.
    (iv) Tool part number or code.
    (v) Tool identification number, or quantity of each tool part number 
or code, if tool identification number is not assigned.
    (vi) Part number(s) of item(s) on which used (complete hierarchy of 
part numbers).
    (vii) Unit price. (Estimates are acceptable.)
    (viii) Storage method code. Assign one of the following:
    Code J. Inside storage.
    Code K. Outside storage.
    Code L. Other.
    (ix) Estimated weight of tool, if over 25 pounds.
    (x) Estimated volume of tool, if over 3 cubic feet.
    (xi) Location of Contractor, subcontractor, vendor for each item. 
Use Federal Supply Code for Manufacturers (FSCM), or name and address if 
code is not available.
    (xii) All operation sheets or other data as are necessary to show 
the manufacturing operation or processes for which such items were used, 
designed, or modified.
    (2) Identification or tagging. To the extent practicable, the 
Contractor shall identify all

[[Page 320]]

special tooling subject to this clause in accordance with the 
Contractor's identification procedures.
    (g) Maintenance. The Contractor shall maintain special tooling in 
accordance with sound industrial practice. These requirements do not 
apply to those items designated by the Contracting Officer for disposal 
as scrap or identified as of no further interest to the Government under 
paragraph (j), Disposition instructions, of this clause.
    (h) Identification of excess special tooling. The Contractor shall 
promptly identify and report all special tooling in excess of the 
amounts needed to complete full performance under this contract (see 
subdivision (i)(2)(i) of this clause).
    (i) Lists of special tooling. The Contractor shall periodically 
prepare and distribute lists of special tooling as described below:
    (1) Special tooling list. The list shall be furnished within 60 days 
after delivery of the first production end item under this contract or 
completion of the initial provisioning process, whichever is later, and 
shall include all special tooling subject to this clause as of the 
reporting date. However, if this contract represents the final 
production contract, the Contractor shall provide this list of all tools 
not later than 180 days prior to scheduled delivery of the last 
production end item. If this is a contract for storage of special 
tooling, the list shall be provided within 60 days of contract 
implementation.
    (2) Excess special tooling list--(i) Excess special tooling. Except 
for items subject to subdivision (i)(2)(ii) of this clause, lists of 
special tooling excess to this contract shall be furnished within 60 
days of the date that the item is determined to be excess. The 
Contractor shall include in this list the information prescribed in 
Format of lists, subparagraph (i)(3) of this clause, as well as the 
applicable excess code as follows:
    Code V. Excess to contract requirements with no follow-on 
requirements.
    Code W. Excess to contract requirements but can be used to support 
actual or anticipated follow-on requirements.
    Code X. Excess due to changes in design or specification of the end 
items.
    Code Y. Excess due to nonserviceable or nonrepairable condition.
    Code Z. Other.
    (ii) Termination inventory. These items shall be submitted on SF 
1432 or by computer list attached to an SF 1432 in accordance with FAR 
45.606. Format and content of this submission will be as prescribed by 
Format of lists, subparagraph (i)(3) of this clause, but will contain 
information as prescribed by FAR subpart 45.6, in effect on the date of 
award of this contract.
    (3) Format of lists. Lists furnished by the Contractor shall state 
the type of list and shall include all information from subparagraph 
(f)(1), Records, of this clause, items (i) through (xi). All lists will 
be grouped by primary retention code as prescribed in subdivision 
(f)(1)(ii)(A) of this clause and further listed in tool part number 
sequence.
    (4) Distribution of lists. The Contractor shall submit two copies of 
lists to each of the following recipients unless otherwise directed:
    (i) The Contracting Officer.
    (ii) The Administrative Contracting Officer.
    (iii) The inventory control point designated by the contracting 
office.
    (j) Disposition instructions. The Contracting Officer shall provide 
the Contractor with written disposition instructions within 180 days of 
receipt of the list as prescribed by subparagraph (i)(1) of this clause 
and within 90 days of the receipt of excess special tooling lists 
reported in accordance with subparagraph (i)(2) of this clause. The 
Contracting Officer may direct disposition by any of the methods listed 
in subparagraphs (j)(1) through (j)(3) of this clause, or a combination 
of such methods. The Contractor shall comply with such disposition 
instructions.
    (1) The Contracting Officer may identify specific items of special 
tooling to be retained or give the Contractor a list specifying the 
products, parts, or services including follow-on requirements for which 
the Government may require special tooling and request the Contractor to 
identify all usable items of special tooling on hand that were designed 
for or used in the production or performance of such products, parts, or 
services. Once items of usable special tooling required by the 
Government are identified, the Contracting Officer may--
    (i) Direct the Contractor to transfer specified items of special 
tooling to follow-on contracts requiring their use. Those items shall be 
furnished for use on the contract(s) as specified by the Contracting 
Officer and shall be subject to the provisions of the gaining 
contracts(s); or
    (ii) Request the Contractor to enter into an appropriate storage 
contract for special tooling specified to be retained by the Contractor 
for the Government. Tooling to be stored shall be stored pursuant to a 
storage contract between the Government and the Contractor; or
    (iii) Direct the Contractor to transfer title to the Government (to 
the extent not previously transferred) and deliver to the Government 
those items of special tooling which are specified for removal from the 
Contractor's plant.
    (2) The Contracting Officer may direct the Contractor to sell, or 
dispose of as scrap, for the account of the Government, any special 
tooling not specified by the Government pursuant to subparagraph (j)(1) 
of this clause. To the extent that the Contractor incurs any

[[Page 321]]

costs occasioned by compliance with such direction, for which it is not 
otherwise compensated, the contract price shall be equitably adjusted in 
accordance with the Changes clause of this contract. The net proceeds of 
all sales shall either be credited to the cost of contract performance 
or shall be otherwise paid to the Government as directed by the 
Contracting Officer. Sale of special tooling to the prime Contractor or 
any of its subcontractors is subject to the prior written approval of 
the Contracting Officer.
    (3) The Contracting Officer may furnish the Contractor with a 
statement disclaiming further Government interest or right in specified 
special tooling.
    (4) Restoration of Contractor's premises. Unless otherwise provided 
in this contract, the Government has no obligation to restore or 
rehabilitate the Contractor's premises under any circumstances (e.g., 
abandonment, disposition upon completion of need, or upon contract 
completion). However, if special tooling is withdrawn or if other 
special tooling is substituted, then the equitable adjustment under 
paragraph (m) of this clause may properly include restoration or 
rehabilitation costs.
    (k) Access to special tooling. The Contractor shall provide access 
to special tooling subject to this clause at all reasonable times to all 
individuals designated by the Contracting Officer.
    (l) Storage or shipment. The Contractor shall promptly arrange for 
either the shipment or the storage of special tooling specified in 
accordance with the final disposition instructions in subdivisions 
(j)(1)(ii) or (j)(1)(iii) of this clause. Tooling to be shipped shall be 
properly packaged, packed, and marked in accordance with the directions 
of the Contracting Officer. All operation sheets or other appropriate 
data necessary to show the manufacturing operations or processes for 
which the items were used or designed shall accompany special tooling to 
be shipped or stored or shall otherwise be provided to the Government as 
directed by the Contracting Officer. To the extent that the Contractor 
incurs costs for storage, shipment, packing, crating, or handling under 
this paragraph and not otherwise compensated for, the contract price 
shall be equitably adjusted in accordance with the Changes clause of 
this contract.
    (m) Equitable adjustment. When this clause specifies an equitable 
adjustment, it shall be made to any affected contract provision in 
accordance with the procedures of the Changes clause. When appropriate, 
the Contracting Officer may initiate an equitable adjustment in favor of 
the Government. The right to an equitable adjustment shall be the 
Contractor's exclusive remedy. The Government shall not be liable to 
suit for breach of contract for--
    (1) Any delay in delivery of Government-furnished special tooling;
    (2) Delivery of Government-furnished special tooling in a condition 
not suitable for its intended use;
    (3) A decrease in or substitution of special tooling; or
    (4) Failure to repair or replace Government-furnished special 
tooling for which the Government is responsible.
    (n) Subcontract provisions. In order to perform this contract, the 
Contractor may place subcontracts (including purchase orders) involving 
the use of special tooling. If the full cost of the tooling is charged 
to those subcontracts, the Contractor agrees to include in the 
subcontract appropriate provisions to obtain Government rights and data 
comparable to the rights of the Government under this clause (unless the 
Contractor and Contracting Officer agree in writing that such rights are 
not of interest to the Government). The Contractor agrees to exercise 
such rights for the benefit of the Government as directed by the 
Contracting Officer.

                             (End of clause)

[54 FR 48995, Nov. 28, 1989]



Sec.  52.245-18  Special Test Equipment.

    As prescribed in 45.307-3, insert the following clause:

                    Special Test Equipment (FEB 1993)

    (a) Special test equipment, as used in this clause, means either 
single or multipurpose integrated test units engineered, designed, 
fabricated, or modified to accomplish special purpose testing in 
performing a contract. It consists of items or assemblies of equipment, 
including standard or general purpose items or components, that are 
interconnected and interdependent so as to become a new functional 
entity for special testing purposes. It does not include material, 
special tooling, facilities (except foundations and similar improvements 
necessary for installing special test equipment), and plant equipment 
items used for general plant testing purposes.
    (b) The Contractor may either acquire or fabricate special test 
equipment at Government expense when the equipment is not otherwise 
itemized in this contract and the prior approval of the Contracting 
Officer has been obtained. The Contractor shall provide the Contracting 
Officer with a written notice, at least 30 days in advance, of the 
Contractor's intention to acquire or fabricate the special test 
equipment. As a minimum, the notice shall also include an estimated 
aggregate cost of all items and components of the equipment the 
individual cost of which is less than $5,000, and the following 
information on each item or component of equipment costing $5,000 or 
more:

[[Page 322]]

    (1) The end use application and function of each proposed special 
test unit, identifying special characteristics and the reasons for the 
classification of the test unit as special test equipment.
    (2) A complete description identifying the items to be acquired and 
the items to be fabricated by the Contractor.
    (3) The estimated cost of the item of special test equipment or 
component.
    (4) A statement that intra-plant screening of Contractor and 
Government-owned special test equipment and components has been 
accomplished and that none are available for use in performing this 
contract.
    (c) The Government may furnish any special test equipment or 
components rather than approve their acquisition or fabrication by the 
Contractor. Such Government-furnished items shall be subject to the 
Government Property clause, except that the Government shall not be 
obligated to deliver such items any sooner than the Contractor could 
have acquired or fabricated them after expiration of the 30-day notice 
period in paragraph (b) of this clause. However, unless the Government 
notifies the Contractor of its decision to furnish the items within the 
30-day notice period, the Contractor may proceed to acquire or fabricate 
the equipment or components subject to any other applicable provisions 
of this contract.
    (d) The Contractor shall, in any subcontract that provides that 
special test equipment or components may be acquired or fabricated for 
the Government, insert provisions that conform substantially to the 
language of this clause, including this paragraph (d). The Contractor 
shall furnish the names of such subcontractors to the Contracting 
Officer.
    (e) If an engineering change requires either the acquisition or 
fabrication of new special test equipment or substantial modification of 
existing special test equipment, the Contractor shall comply with 
paragraph (b) above. In so complying, the Contractor shall identify the 
change order which requires the proposed acquisition, fabrication, or 
modification.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 53 FR 27468, July 20, 1988; 
53 FR 36028, Sept. 16, 1988; 54 FR 48997, Nov. 28, 1989; 57 FR 60589, 
Dec. 21, 1992]



Sec.  52.245-19  Government Property Furnished ``As Is.''

    As prescribed in 45.308-2, insert the following clause:

           Government Property Furnished ``As Is'' (APR 1984)

    (a) The Government makes no warranty whatsoever with respect to 
Government property furnished as is, except that the property is in the 
same condition when placed at the f.o.b. point specified in the 
solicitation as when inspected by the Contractor pursuant to the 
solicitation or, if not inspected by the Contractor, as when last 
available for inspection under the solicitation.
    (b) The Contractor may repair any property made available on an as 
is basis. Such repair will be at the Contractor's expense except as 
otherwise provided in this clause. Such property may be modified at the 
Contractor's expense, but only with the written permission of the 
Contracting Officer. Any repair or modification of property furnished as 
is shall not affect the title of the Government.
    (c) If there is any change in the condition of Government property 
furnished as is from the time inspected or last available for inspection 
under the solicitation to the time placed on board at the location 
specified in the solicitation, and such change will adversely affect the 
Contractor, the Contractor shall, upon receipt of the property, notify 
the Contracting Officer detailing the facts and, as directed by the 
Contracting Officer, either (1) return such property at the Government's 
expense or otherwise dispose of the property or (2) effect repairs to 
return the property to its condition when inspected under the 
solicitation or, if not inspected, last available for inspection under 
the solicitation. After completing the directed action and upon written 
request of the Contractor, the Contracting Officer shall equitably 
adjust any contractual provisions affected by the return, disposition, 
or repair in accordance with the procedures provided for in the Changes 
clause of this contract. The foregoing provisions for adjustment are the 
exclusive remedy available to the Contractor, and the Government shall 
not be otherwise liable for any delivery of Government property 
furnished as is in a condition other than that in which it was 
originally offered.
    (d) Except as otherwise provided in this clause, Government property 
furnished as is shall be governed by the Government Property clause of 
this contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 48997, Nov. 28, 1989]



Sec.  52.246-1  Contractor Inspection Requirements.

    As prescribed in 46.301, insert the following clause:

[[Page 323]]

              Contractor Inspection Requirements (APR 1984)

    The Contractor is responsible for performing or having performed all 
inspections and tests necessary to substantiate that the supplies or 
services furnished under this contract conform to contract requirements, 
including any applicable technical requirements for specified 
manufacturers' parts. This clause takes precedence over any Government 
inspection and testing required in the contract's specifications, except 
for specialized inspections or tests specified to be performed solely by 
the Government.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34762, July 3, 1995]



Sec.  52.246-2  Inspection of Supplies--Fixed-Price.

    As prescribed in 46.302, insert the following clause:

             Inspection of Supplies--Fixed-Price (AUG 1996)

    (a) Definition. Supplies, as used in this clause, includes but is 
not limited to raw materials, components, intermediate assemblies, end 
products, and lots of supplies.
    (b) The Contractor shall provide and maintain an inspection system 
acceptable to the Government covering supplies under this contract and 
shall tender to the Government for acceptance only supplies that have 
been inspected in accordance with the inspection system and have been 
found by the Contractor to be in conformity with contract requirements. 
As part of the system, the Contractor shall prepare records evidencing 
all inspections made under the system and the outcome. These records 
shall be kept complete and made available to the Government during 
contract performance and for as long afterwards as the contract 
requires. The Government may perform reviews and evaluations as 
reasonably necessary to ascertain compliance with this paragraph. These 
reviews and evaluations shall be conducted in a manner that will not 
unduly delay the contract work. The right of review, whether exercised 
or not, does not relieve the Contractor of the obligations under the 
contract.
    (c) The Government has the right to inspect and test all supplies 
called for by the contract, to the extent practicable, at all places and 
times, including the period of manufacture, and in any event before 
acceptance. The Government shall perform inspections and tests in a 
manner that will not unduly delay the work. The Government assumes no 
contractual obligation to perform any inspection and test for the 
benefit of the Contractor unless specifically set forth elsewhere in 
this contract.
    (d) If the Government performs inspection or test on the premises of 
the Contractor or a subcontractor, the Contractor shall furnish, and 
shall require subcontractors to furnish, at no increase in contract 
price, all reasonable facilities and assistance for the safe and 
convenient performance of these duties. Except as otherwise provided in 
the contract, the Government shall bear the expense of Government 
inspections or tests made at other than the Contractor's or 
subcontractor's premises; provided, that in case of rejection, the 
Government shall not be liable for any reduction in the value of 
inspection or test samples.
    (e)(1) When supplies are not ready at the time specified by the 
Contractor for inspection or test, the Contracting Officer may charge to 
the Contractor the additional cost of inspection or test.
    (2) The Contracting Officer may also charge the Contractor for any 
additional cost of inspection or test when prior rejection makes 
reinspection or retest necessary.
    (f) The Government has the right either to reject or to require 
correction of nonconforming supplies. Supplies are nonconforming when 
they are defective in material or workmanship or are otherwise not in 
conformity with contract requirements. The Government may reject 
nonconforming supplies with or without disposition instructions.
    (g) The Contractor shall remove supplies rejected or required to be 
corrected. However, the Contracting Officer may require or permit 
correction in place, promptly after notice, by and at the expense of the 
Contractor. The Contractor shall not tender for acceptance corrected or 
rejected supplies without disclosing the former rejection or requirement 
for correction, and, when required, shall disclose the corrective action 
taken.
    (h) If the Contractor fails to promptly remove, replace, or correct 
rejected supplies that are required to be removed or to be replaced or 
corrected, the Government may either (1) by contract or otherwise, 
remove, replace, or correct the supplies and charge the cost to the 
Contractor or (2) terminate the contract for default. Unless the 
Contractor corrects or replaces the supplies within the delivery 
schedule, the Contracting Officer may require their delivery and make an 
equitable price reduction. Failure to agree to a price reduction shall 
be a dispute.
    (i)(1) If this contract provides for the performance of Government 
quality assurance at source, and if requested by the Government, the 
Contractor shall furnish advance notification of the time (i) when 
Contractor inspection or tests will be performed in accordance with the 
terms and conditions of

[[Page 324]]

the contract and (ii) when the supplies will be ready for Government 
inspection.
    (2) The Governments request shall specify the period and method of 
the advance notification and the Government representative to whom it 
shall be furnished. Requests shall not require more than 2 workdays of 
advance notification if the Government representative is in residence in 
the Contractor's plant, nor more than 7 workdays in other instances.
    (j) The Government shall accept or reject supplies as promptly as 
practicable after delivery, unless otherwise provided in the contract. 
Government failure to inspect and accept or reject the supplies shall 
not relieve the Contractor from responsibility, nor impose liability on 
the Government, for nonconforming supplies.
    (k) Inspections and tests by the Government do not relieve the 
Contractor of responsibility for defects or other failures to meet 
contract requirements discovered before acceptance. Acceptance shall be 
conclusive, except for latent defects, fraud, gross mistakes amounting 
to fraud, or as otherwise provided in the contract.
    (l) If acceptance is not conclusive for any of the reasons in 
paragraph (k) hereof, the Government, in addition to any other rights 
and remedies provided by law, or under other provisions of this 
contract, shall have the right to require the Contractor (1) at no 
increase in contract price, to correct or replace the defective or 
nonconforming supplies at the original point of delivery or at the 
Contractor's plant at the Contracting Officer's election, and in 
accordance with a reasonable delivery schedule as may be agreed upon 
between the Contractor and the Contracting Officer; provided, that the 
Contracting Officer may require a reduction in contract price if the 
Contractor fails to meet such delivery schedule, or (2) within a 
reasonable time after receipt by the Contractor of notice of defects or 
nonconformance, to repay such portion of the contract as is equitable 
under the circumstances if the Contracting Officer elects not to require 
correction or replacement. When supplies are returned to the Contractor, 
the Contractor shall bear the transportation cost from the original 
point of delivery to the Contractor's plant and return to the original 
point when that point is not the Contractor's plant. If the Contractor 
fails to perform or act as required in (1) or (2) above and does not 
cure such failure within a period of 10 days (or such longer period as 
the Contracting Officer may authorize in writing) after receipt of 
notice from the Contracting Officer specifying such failure, the 
Government shall have the right by contract or otherwise to replace or 
correct such supplies and charge to the Contractor the cost occasioned 
the Government thereby.

                             (End of clause)

    Alternate I (JUL 1985). If a fixed-price incentive contract is 
contemplated, substitute paragraphs (g), (h), and (l) below for 
paragraphs (g), (h), and (l) of the basic clause.

    (g) The Contractor shall remove supplies rejected or required to be 
corrected. However, the Contracting Officer may require or permit 
correction in place, promptly after notice. The Contractor shall not 
tender for acceptance corrected or rejected supplies without disclosing 
the former rejection or requirement for correction, and when required 
shall disclose the corrective action taken. Cost of removal, 
replacement, or correction shall be considered a cost incurred, or to be 
incurred, in the total final negotiated cost fixed under the incentive 
price revision clause. However, replacements or corrections by the 
Contractor after the establishment of the total final price shall be at 
no increase in the total final price.
    (h) If the Contractor fails to promptly remove, replace, or correct 
rejected supplies that are required to be removed or to be replaced or 
corrected, the Government may either (1) by contract or otherwise, 
remove, replace, or correct the supplies and equitably reduce the target 
price or, if established, the total final price or (2) may terminate the 
contract for default. Unless the Contractor corrects or replaces the 
nonconforming supplies within the delivery schedule, the Contracting 
Officer may require their delivery and equitably reduce any target price 
or, if it is established, the total final contract price. Failure to 
agree upon an equitable price reduction shall be a dispute.
    (l) If acceptance is not conclusive for any of the reasons in 
paragraph (k) hereof, the Government, in addition to any other rights 
and remedies provided by law, or under other provisions of this 
contract, shall have the right to require the Contractor (1) at no 
increase in any target price or, if it is established, the total final 
price of this contract, to correct or replace the defective or 
nonconforming supplies at the original point of delivery or at the 
Contractor's plant at the Contracting Officer's election, and in 
accordance with a reasonable delivery schedule as may be agreed upon 
between the Contractor and the Contracting Officer; provided, that the 
Contracting Officer may require a reduction in any target price, or, if 
it is established, the total final price of this contract, if the 
Contractor fails to meet such delivery schedule; or (2) within a 
reasonable time after receipt by the Contractor of notice of defects or 
nonconformance, to repay such portion of the total final price as is 
equitable under the circumstances if the Contracting Officer elects not 
to require correction or replacement. When supplies are returned to

[[Page 325]]

the Contractor, the Contractor shall bear the transportation costs from 
the original point of delivery to the Contractor's plant and return to 
the original point when that point is not the Contractor's plant. If the 
Contractor fails to perform or act as required in (1) or (2) above and 
does not cure such failure within a period of 10 days (or such longer 
period as the Contracting Officer may authorize in writing) after 
receipt of notice from the Contracting Officer specifying such failure, 
the Government shall have the right by contract or otherwise to replace 
or correct such supplies and equitably reduce any target price or, if it 
is established, the total final price of this contract.

    Alternate II (JUL 1985). If a fixed-ceiling-price contract with 
retroactive price redetermination is contemplated, substitute paragraphs 
(g), (h), and (l) below for paragraphs (g), (h), and (l) of the basic 
clause:

    (g) The Contractor shall remove supplies rejected or required to be 
corrected. However, the Contracting Officer may require or permit 
correction in place, promptly after notice. The Contractor shall not 
tender for acceptance corrected or rejected supplies without disclosing 
the former rejection or requirement for correction, and when required 
shall disclose the corrective action taken. Cost of removal, 
replacement, or correction shall be considered a cost incurred, or to be 
incurred, when redetermining the prices under the price redetermination 
clause. However, replacements or corrections by the Contractor after the 
establishment of the redetermined prices shall be at no increase in the 
redetermined price.
    (h) If the Contractor fails to promptly remove, replace, or correct 
rejected supplies that are required to be removed or to be replaced or 
corrected, the Government may either (1) by contract or otherwise, 
remove, replace, or correct the supplies and equitably reduce the 
initial contract prices or, if established, the redetermined contract 
prices or (2) terminate the contract for default. Unless the Contractor 
corrects or replaces the nonconforming supplies within the delivery 
schedule, the Contracting Officer may require their delivery and 
equitably reduce the initial contract price or, if it is established, 
the redetermined contract prices. Failure to agree upon an equitable 
price reduction shall be a dispute.
    (l) If acceptance is not conclusive for any of the reasons in 
paragraph (k) hereof, the Government, in addition to any other rights 
and remedies provided by law, or under other provisions of this 
contract, shall have the right to require the Contractor (1) at no 
increase in the initial contract prices, or, if it is established, the 
redetermined prices of this contract, to correct or replace the 
defective or nonconforming supplies at the original point of delivery or 
at the Contractor's plant at the Contracting Officer's election, and in 
accordance with a reasonable delivery schedule as may be agreed upon 
between the Contractor and the Contracting Officer; provided, that the 
Contracting Officer may require a reduction in the initial contract 
prices, or, if it is established, the redetermined prices of this 
contract, if the Contractor fails to meet such delivery schedule; or (2) 
within a reasonable time after receipt by the Contractor of notice of 
defects or nonconformance, to repay such portion of the initial contract 
prices, or, if it is established, the redetermined prices of this 
contract, as is equitable under the circumstances if the Contracting 
Officer elects not to require correction or replacement. When supplies 
are returned to the Contractor, the Contractor shall bear the 
transportation costs from the original point of delivery to the 
Contractor's plant and return to the original point when that point is 
not the Contractor's plant. If the Contractor fails to perform or act as 
required in (1) or (2) above and does not cure such failure within a 
period of 10 days (or such longer period as the Contracting Officer may 
authorize in writing) after receipt of notice from the Contracting 
Officer specifying such failure, the Government shall have the right by 
contract or otherwise to replace or correct such supplies and equitably 
reduce the initial contract prices, or, if it is established, the 
redetermined prices of this contract.

[48 FR 42478, Sept. 19, 1983, as amended at 50 FR 26905, June 28, 1985; 
56 FR 41745, Aug. 22, 1991; 61 FR 31665, June 20, 1996]



Sec.  52.246-3  Inspection of Supplies--Cost-Reimbursement.

    As prescribed in 46.303, insert the following clause in 
solicitations and contracts for supplies, or services that involve the 
furnishing of supplies, when a cost-reimbursement contract is 
contemplated:

          Inspection of Supplies--Cost-Reimbursement (MAY 2001)

    (a) Definitions. As used in this clause--
    Contractor's managerial personnel means any of the Contractor's 
directors, officers, managers, superintendents, or equivalent 
representatives who have supervision or direction of--
    (1) All or substantially all of the Contractor's business;
    (2) All or substantially all of the Contractor's operation at a 
plant or separate location where the contract is being performed; or

[[Page 326]]

    (3) A separate and complete major industrial operation connected 
with performing this contract.
    Supplies includes but is not limited to raw materials, components, 
intermediate assemblies, end products, lots of supplies, and, when the 
contract does not include the Warranty of Data clause, data.
    (b) The Contractor shall provide and maintain an inspection system 
acceptable to the Government covering the supplies, fabricating methods, 
and special tooling under this contract. Complete records of all 
inspection work performed by the Contractor shall be maintained and made 
available to the Government during contract performance and for as long 
afterwards as the contract requires.
    (c) The Government has the right to inspect and test the contract 
supplies, to the extent practicable at all places and times, including 
the period of manufacture, and in any event before acceptance. The 
Government may also inspect the plant or plants of the Contractor or any 
subcontractor engaged in the contract performance. The Government shall 
perform inspections and tests in a manner that will not unduly delay the 
work.
    (d) If the Government performs inspection or test on the premises of 
the Contractor or a subcontractor, the Contractor shall furnish and 
shall require subcontractors to furnish all reasonable facilities and 
assistance for the safe and convenient performance of these duties.
    (e) Unless otherwise specified in the contract, the Government shall 
accept supplies as promptly as practicable after delivery, and supplies 
shall be deemed accepted 60 days after delivery, unless accepted 
earlier.
    (f) At any time during contract performance, but no later than 6 
months (or such other time as may be specified in the contract) after 
acceptance of the supplies to be delivered under the contract, the 
Government may require the Contractor to replace or correct any supplies 
that are nonconforming at time of delivery. Supplies are nonconforming 
when they are defective in material or workmanship or are otherwise not 
in conformity with contract requirements. Except as otherwise provided 
in paragraph (h) below, the cost of replacement or correction shall be 
included in allowable cost, determined as provided in the Allowable Cost 
and Payment clause, but no additional fee shall be paid. The Contractor 
shall not tender for acceptance supplies required to be replaced or 
corrected without disclosing the former requirement for replacement or 
correction, and, when required, shall disclose the corrective action 
taken.
    (g)(1) If the Contractor fails to proceed with reasonable promptness 
to perform required replacement or correction, the Government may--
    (i) By contract or otherwise, perform the replacement or correction 
and charge to the Contractor any increased cost or make an equitable 
reduction in any fixed fee paid or payable under the contract;
    (ii) Require delivery of undelivered supplies at an equitable 
reduction in any fixed fee paid or payable under the contract; or
    (iii) Terminate the contract for default.
    (2) Failure to agree on the amount of increased cost to be charged 
to the Contractor or to the reduction in the fixed fee shall be a 
dispute.
    (h) Notwithstanding paragraphs (f) and (g) above, the Government may 
at any time require the Contractor to correct or replace, without cost 
to the Government, nonconforming supplies, if the nonconformances are 
due to (1) fraud, lack of good faith, or willful misconduct on the part 
of the Contractor's managerial personnel or (2) the conduct of one or 
more of the Contractor's employees selected or retained by the 
Contractor after any of the Contractor's managerial personnel has 
reasonable grounds to believe that the employee is habitually careless 
or unqualified.
    (i) This clause applies in the same manner to corrected or 
replacement supplies as to supplies originally delivered.
    (j) The Contractor shall have no obligation or liability under this 
contract to replace supplies that were nonconforming at the time of 
delivery, except as provided in this clause or as may be otherwise 
provided in the contract.
    (k) Except as otherwise specified in the contract, the Contractor's 
obligation to correct or replace Government-furnished property shall be 
governed by the clause pertaining to Government property.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 66 FR 2135, Jan. 10, 2001]



Sec.  52.246-4  Inspection of Services--Fixed-Price.

    As prescribed in 46.304, insert the following clause:

             Inspection of Services--Fixed-Price (AUG 1996)

    (a) Definitions. Services, as used in this clause, includes services 
performed, workmanship, and material furnished or utilized in the 
performance of services.
    (b) The Contractor shall provide and maintain an inspection system 
acceptable to the Government covering the services under this contract. 
Complete records of all inspection work performed by the Contractor 
shall be maintained and made available to the Government during contract 
performance and

[[Page 327]]

for as long afterwards as the contract requires.
    (c) The Government has the right to inspect and test all services 
called for by the contract, to the extent practicable at all times and 
places during the term of the contract. The Government shall perform 
inspections and tests in a manner that will not unduly delay the work.
    (d) If the Government performs inspections or tests on the premises 
of the Contractor or a subcontractor, the Contractor shall furnish, and 
shall require subcontractors to furnish, at no increase in contract 
price, all reasonable facilities and assistance for the safe and 
convenient performance of these duties.
    (e) If any of the services do not conform with contract 
requirements, the Government may require the Contractor to perform the 
services again in conformity with contract requirements, at no increase 
in contract amount. When the defects in services cannot be corrected by 
reperformance, the Government may (1) require the Contractor to take 
necessary action to ensure that future performance conforms to contract 
requirements and (2) reduce the contract price to reflect the reduced 
value of the services performed.
    (f) If the Contractor fails to promptly perform the services again 
or to take the necessary action to ensure future performance in 
conformity with contract requirements, the Government may (1) by 
contract or otherwise, perform the services and charge to the Contractor 
any cost incurred by the Government that is directly related to the 
performance of such service or (2) terminate the contract for default.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 56 FR 67136, Dec. 27, 1991; 
61 FR 31665, June 20, 1996]



Sec.  52.246-5  Inspection of Services--Cost-Reimbursement.

    As prescribed in 46.305, insert the following clause in 
solicitations and contracts for services, or supplies that involve the 
furnishing of services, when a cost-reimbursement contract is 
contemplated:

          Inspection of Services--Cost-Reimbursement (APR 1984)

    (a) Definition. Services, as used in this clause, includes services 
performed, workmanship, and material furnished or used in performing 
services.
    (b) The Contractor shall provide and maintain an inspection system 
acceptable to the Government covering the services under this contract. 
Complete records of all inspection work performed by the Contractor 
shall be maintained and made available to the Government during contract 
performance and for as long afterwards as the contract requires.
    (c) The Government has the right to inspect and test all services 
called for by the contract, to the extent practicable at all places and 
times during the term of the contract. The Government shall perform 
inspections and tests in a manner that will not unduly delay the work.
    (d) If any of the services performed do not conform with contract 
requirements, the Government may require the Contractor to perform the 
services again in conformity with contract requirements, for no 
additional fee. When the defects in services cannot be corrected by 
reperformance, the Government may (1) require the Contractor to take 
necessary action to ensure that future performance conforms to contract 
requirements and (2) reduce any fee payable under the contract to 
reflect the reduced value of the services performed.
    (e) If the Contractor fails to promptly perform the services again 
or take the action necessary to ensure future performance in conformity 
with contract requirements, the Government may (1) by contract or 
otherwise, perform the services and reduce any fee payable by an amount 
that is equitable under the circumstances or (2) terminate the contract 
for default.

                             (End of clause)



Sec.  52.246-6  Inspection--Time-and-Material and Labor-Hour.

    As prescribed in 46.306, insert the following clause:

         Inspection--Time-and-Material and Labor-Hour (MAY 2001)

    (a) Definitions. As used in this clause--Contractor's managerial 
personnel means any of the Contractor's directors, officers, managers, 
superintendents, or equivalent representatives who have supervision or 
direction of--
    (1) All or substantially all of the Contractor's business;
    (2) All or substantially all of the Contractor's operation at any 
one plant or separate location where the contract is being performed; or
    (3) A separate and complete major industrial operation connected 
with the performance of this contract.
    Materials includes data when the contract does not include the 
Warranty of Data clause.
    (b) The Contractor shall provide and maintain an inspection system 
acceptable to the Government covering the material, fabricating methods, 
work, and services under

[[Page 328]]

this contract. Complete records of all inspection work performed by the 
Contractor shall be maintained and made available to the Government 
during contract performance and for as long afterwards as the contract 
requires.
    (c) The Government has the right to inspect and test all materials 
furnished and services performed under this contract, to the extent 
practicable at all places and times, including the period of 
performance, and in any event before acceptance. The Government may also 
inspect the plant or plants of the Contractor or any subcontractor 
engaged in contract performance. The Government shall perform 
inspections and tests in a manner that will not unduly delay the work.
    (d) If the Government performs inspection or test on the premises of 
the Contractor or a subcontractor, the Contractor shall furnish and 
shall require subcontractors to furnish all reasonable facilities and 
assistance for the safe and convenient performance of these duties.
    (e) Unless otherwise specified in the contract, the Government shall 
accept or reject services and materials at the place of delivery as 
promptly as practicable after delivery, and they shall be presumed 
accepted 60 days after the date of delivery, unless accepted earlier.
    (f) At any time during contract performance, but not later than 6 
months (or such other time as may be specified in the contract) after 
acceptance of the services or materials last delivered under this 
contract, the Government may require the Contractor to replace or 
correct services or materials that at time of delivery failed to meet 
contract requirements. Except as otherwise specified in paragraph (h) 
below, the cost of replacement or correction shall be determined under 
the Payments Under Time-and-Materials and Labor-Hour Contracts clause, 
but the hourly rate for labor hours incurred in the replacement or 
correction shall be reduced to exclude that portion of the rate 
attributable to profit. The Contractor shall not tender for acceptance 
materials and services required to be replaced or corrected without 
disclosing the former requirement for replacement or correction, and, 
when required, shall disclose the corrective action taken.
    (g)(1) If the Contractor fails to proceed with reasonable promptness 
to perform required replacement or correction, and if the replacement or 
correction can be performed within the ceiling price (or the ceiling 
price as increased by the Government), the Government may--
    (i) By contract or otherwise, perform the replacement or correction, 
charge to the Contractor any increased cost, or deduct such increased 
cost from any amounts paid or due under this contract; or
    (ii) Terminate this contract for default.
    (2) Failure to agree to the amount of increased cost to be charged 
to the Contractor shall be a dispute.
    (h) Notwithstanding paragraphs (f) and (g) above, the Government may 
at any time require the Contractor to remedy by correction or 
replacement, without cost to the Government, any failure by the 
Contractor to comply with the requirements of this contract, if the 
failure is due to (1) fraud, lack of good faith, or willful misconduct 
on the part of the Contractor's managerial personnel or (2) the conduct 
of one or more of the Contractor's employees selected or retained by the 
Contractor after any of the Contractor's managerial personnel has 
reasonable grounds to believe that the employee is habitually careless 
or unqualified.
    (i) This clause applies in the same manner and to the same extent to 
corrected or replacement materials or services as to materials and 
services originally delivered under this contract.
    (j) The Contractor has no obligation or liability under this 
contract to correct or replace materials and services that at time of 
delivery do not meet contract requirements, except as provided in this 
clause or as may be otherwise specified in the contract.
    (k) Unless otherwise specified in the contract, the Contractor's 
obligation to correct or replace Government-furnished property shall be 
governed by the clause pertaining to Government property.

                             (End of clause)

    Alternate I (APR 1984). If Government inspection and acceptance are 
to be performed at the contractor's plant, paragraph (e) below may be 
substituted for paragraph (e) of the basic clause:

    (e) The Government shall inspect for acceptance all items (other 
than aircraft to be flown away, if any) to be furnished under this 
contract at the Contractor's plant or plants specified in the contract, 
or at any other plant or plants approved for such purpose in writing by 
the Contracting Officer. The Contractor shall inform the contract 
administration office or Contracting Officer when the work is ready for 
inspection. The Government reserves the right to charge to the 
Contractor any additional cost of Government inspection and test when 
items are not ready at the time for which inspection and test is 
requested by the Contractor.

[48 FR 42478, Sept. 19, 1983, as amended at 51 FR 2667, Jan. 17, 1986; 
66 FR 2135, Jan. 10, 2001]



Sec.  52.246-7  Inspection of Research and Development--Fixed-Price.

    As prescribed in 46.307(a), insert the following clause:

[[Page 329]]

     Inspection of Research and Development--Fixed-Price (AUG 1996)

    (a) The Contractor shall provide and maintain an inspection system 
acceptable to the Government covering the work under this contract. 
Complete records of all inspection work performed by the Contractor 
shall be maintained and made available to the Government during contract 
performance and for as long afterwards as the contract requires.
    (b) The Government has the right to inspect and test all work called 
for by the contract, to the extent practicable at all places and times, 
including the period of performance, and in any event before acceptance. 
The Government may also inspect the premises of the Contractor or any 
subcontractor engaged in contract performance. The Government shall 
perform inspections and tests in a manner that will not unduly delay the 
work.
    (c) If the Government performs any inspection or test on the 
premises of the Contractor or a subcontractor, the Contractor shall 
furnish and shall require subcontractors to furnish, at no increase in 
contract price, all reasonable facilities and assistance for the safe 
and convenient performance of these duties. Except as otherwise provided 
in the contract, the Government shall bear the expense of Government 
inspections or tests made at other than the Contractor's or 
subcontractor's premises.
    (d) The Government shall accept or reject the work as promptly as 
practicable after delivery, unless otherwise specified in the contract. 
Government failure to inspect and accept or reject the work shall not 
relieve the Contractor from responsibility, nor impose liability on the 
Government, for nonconforming work. Work is nonconforming when it is 
defective in material or workmanship or is otherwise not in conformity 
with contract requirements.
    (e) The Government has the right to reject nonconforming work. If 
the Contractor fails or is unable to correct or to replace nonconforming 
work within the delivery schedule (or such later time as the Contracting 
Officer may authorize), the Contracting Officer may accept the work and 
make an equitable price reduction. Failure to agree on a price reduction 
shall be a dispute.
    (f) Inspection and test by the Government does not relieve the 
Contractor from responsibility for defects or other failures to meet the 
contract requirements that may be discovered before acceptance. 
Acceptance shall be conclusive, except for latent defects, fraud, gross 
mistakes amounting to fraud, or as otherwise specified in the contract. 
If acceptance is not conclusive for any of these causes, the Government, 
in addition to any other rights and remedies provided by law, or under 
other provisions of this contract, shall have the right to require the 
Contractor (1) at no increase in contract price, to correct or replace 
the defective or nonconforming supplies (work) at the original point of 
delivery or at the Contractor's plant at the Contracting Officer's 
election, and in accordance with a reasonable delivery schedule as may 
be agreed upon between the Contractor and the Contracting Officer; 
provided, the Contracting Officer may require a reduction in contract 
price if the Contractor fails to meet such delivery schedule; or (2) 
within a reasonable time after the Contractor's receipt of notice of 
defects or nonconformance, to repayment of such portion of the contract 
price as is equitable under the circumstances if the Government elects 
not to require correction or replacement. When supplies (work) are (is) 
returned to the Contractor, the Contractor shall bear transportation 
costs from the original point of delivery to the Contractor's plant and 
return to the original point of delivery when that point is not the 
Contractor's plant.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34762, July 3, 1995; 
61 FR 31665, June 20, 1996]



Sec.  52.246-8  Inspection of Research and Development--Cost-Reimbursement.

    As prescribed in 46.308, insert the following clause in 
solicitations and contracts for research and development when (a) the 
primary objective is the delivery of end items other than designs, 
drawings, or reports, and (b) a cost-reimbursement contract is 
contemplated; unless use of the clause is impractical and the clause 
prescribed in 46.309 is considered to be more appropriate:

  Inspection of Research and Development--Cost-Reimbursement (MAY 2001)

    (a) Definitions. As used in this clause-- Contractor's managerial 
personnel means the Contractor's directors, officers, managers, 
superintendents, or equivalent representatives who have supervision or 
direction of--
    (1) All or substantially all of the Contractor's business;
    (2) All or substantially all of the Contractor's operation at any 
one plant or separate location where the contract is being performed; or
    (3) A separate and complete major industrial operation connected 
with performing this contract.
    Work includes data when the contract does not include the Warranty 
of Data clause.

[[Page 330]]

    (b) The Contractor shall provide and maintain an inspection system 
acceptable to the Government covering the work under this contract. 
Complete records of all inspection work performed by the Contractor 
shall be maintained and made available to the Government during contract 
performance and for as long afterwards as the contract requires.
    (c) The Government has the right to inspect and test all work called 
for by the contract, to the extent practicable at all places and times, 
including the period of performance, and in any event before acceptance. 
The Government may also inspect the plant or plants of the Contractor or 
its subcontractors engaged in the contract performance. The Government 
shall perform inspections and tests in a manner that will not unduly 
delay the work.
    (d) If the Government performs any inspection or test on the 
premises of the Contractor or a subcontractor, the Contractor shall 
furnish and shall require subcontractors to furnish all reasonable 
facilities and assistance for the safe and convenient performance of 
these duties.
    (e) Unless otherwise provided in the contract, the Government shall 
accept work as promptly as practicable after delivery, and work shall be 
deemed accepted 90 days after delivery, unless accepted earlier.
    (f) At any time during contract performance, but no later than 6 
months (or such other time as may be specified in the contract) after 
acceptance of all of the end items (other than designs, drawings, or 
reports) to be delivered under the contract, the Government may require 
the Contractor to replace or correct work not meeting contract 
requirements. Time devoted to the replacement or correction of such work 
shall not be included in the computation of the above time period. 
Except as otherwise provided in paragraph (h) below, the cost of 
replacement or correction shall be determined as specified in the 
Allowable Cost and Payment clause, but no additional fee shall be paid. 
The Contractor shall not tender for acceptance work required to be 
replaced or corrected without disclosing the former requirement for 
replacement or correction, and, when required, shall disclose the 
corrective action taken.
    (g)(1) If the Contractor fails to proceed with reasonable promptness 
to perform required replacement or correction, the Government may--
    (i) By contract or otherwise, perform the replacement or correction, 
charge to the Contractor any increased cost, or make an equitable 
reduction in any fixed fee paid or payable under the contract;
    (ii) Require delivery of any undelivered articles and shall have the 
right to make an equitable reduction in any fixed fee paid or payable 
under the contract; or
    (iii) Terminate the contract for default.
    (2) Failure to agree on the amount of increased cost to be charged 
the Contractor or to the reduction in fixed fee shall be a dispute.
    (h) Notwithstanding paragraphs (f) and (g) above, the Government may 
at any time require the Contractor to remedy by correction or 
replacement, without cost to the Government, any failure by the 
Contractor to comply with the requirements of this contract, if the 
failure is due to (1) fraud, lack of good faith, or willful misconduct 
on the part of the Contractor's managerial personnel or (2) the conduct 
of one or more of the Contractor's employees selected or retained by the 
Contractor after any of the Contractor's managerial personnel has 
reasonable grounds to believe that the employee is habitually careless 
or unqualified.
    (i) This clause shall apply in the same manner to a corrected or 
replacement end item or components as to work originally delivered.
    (j) The Contractor has no obligation or liability under the contract 
to correct or replace articles not meeting contract requirements at time 
of delivery, except as provided in this clause or as may otherwise be 
specified in the contract.
    (k) Unless otherwise provided in the contract, the Contractor's 
obligations to correct or replace Government-furnished property shall be 
governed by the clause pertaining to Government property.

                             (End of clause)

    Alternate I (APR 1984). If it is contemplated that the contract will 
be on a no-fee basis, substitute paragraphs (f) and (g) below for 
paragraphs (f) and (g) of the basic clause.

    (f) At any time during contract performance, but not later than 6 
months (or such other time as may be specified in the contract) after 
acceptance of all of the end items (other than designs, drawings, or 
reports) to be delivered under the contract, the Government may require 
the Contractor to correct or replace work not meeting contract 
requirements. Time devoted to the correction or replacement of such work 
shall not be included in the computation of the above time period. 
Except as otherwise provided in paragraph (g) below, the allowability of 
the cost of any such replacement or correction shall be determined as 
specified in the Allowable Cost and Payment clause. The Contractor shall 
not tender for acceptance corrected work without disclosing the former 
requirement for correction, and, when required, shall disclose the 
corrective action taken.
    (g) If the Contractor fails to proceed with reasonable promptness to 
perform required

[[Page 331]]

replacement or correction, the Government may (1) by contract or 
otherwise, perform the replacement or correction and charge to the 
Contractor any increased cost, (2) require delivery of any undelivered 
articles, or (3) terminate the contract for default. Failure to agree on 
the amount of increased cost to be charged to the Contractor shall be a 
dispute.

[48 FR 42478, Sept. 19, 1983, as amended at 66 FR 2135, Jan. 10, 2001]



Sec.  52.246-9  Inspection of Research and Development (Short Form).

    As prescribed in 46.309, insert the following clause:

     Inspection of Research and Development (Short Form) (APR 1984)

    The Government has the right to inspect and evaluate the work 
performed or being performed under the contract, and the premises where 
the work is being performed, at all reasonable times and in a manner 
that will not unduly delay the work. If the Government performs 
inspection or evaluation on the premises of the Contractor or a 
subcontractor, the Contractor shall furnish and shall require 
subcontractors to furnish all reasonable facilities and assistance for 
the safe and convenient performance of these duties.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 51 FR 27120, July 29, 1986]



Sec.  52.246-10  Inspection of Facilities.

    As prescribed in 46.310, insert the following clause in 
solicitations and contracts when a facilities contract is contemplated:

                   Inspection of Facilities (APR 1984)

    (a) Definition. Contractor's managerial personnel, as used in this 
clause, is defined in the Liability for the Facilities clause of this 
contract.
    (b) The Contractor shall provide and maintain an inspection system 
acceptable to the Government covering the facilities and work called for 
by this contract. Complete records of all inspection work performed by 
the Contractor shall be maintained and made available to the Government 
during contract performance and for as long afterwards as the contract 
requires.
    (c) The Government has the right to inspect and test the facilities 
and work called for by the contract, to the extent practicable at all 
places and times, including the period of manufacture. The Government 
may also inspect the facilities and work at the plant or plants of the 
Contractor or its subcontractors engaged in the performance of the 
contract. The Government shall perform inspections and tests in a manner 
that will not unduly delay the work to be performed by the Contractor 
under this contract or any related contract.
    (d) If the Government performs inspection or test on the premises of 
the Contractor or a subcontractor, the Contractor shall furnish and 
shall require subcontractors to furnish all reasonable facilities and 
assistance for the safe and convenient performance of these duties.
    (e) The Contracting Officer may, at any time, require the Contractor 
to correct or replace facilities or work that is defective or does not 
conform to contract requirements. Except as provided in paragraph (f) 
below, corrections and replacements shall be at Government expense if, 
under the terms of this contract, the facilities or work corrected or 
replaced were initially furnished, or required to be performed at 
Government expense.
    (f) The Contracting Officer may, at any time, require the Contractor 
to correct or replace facilities or work that is defective or does not 
conform to contract requirements, without cost to the Government under 
this contract or any related contract or subcontract, if the defects or 
failures are due to fraud, lack of good faith, or willful misconduct on 
the part of the Contractor's managerial personnel; or to the conduct of 
one or more of the Contractor's employees selected or retained by the 
Contractor after any of the Contractor's managerial personnel has 
reasonable grounds to believe that the employee is habitually careless 
or unqualified.
    (g) Corrected or replacement facilities or work shall be subject to 
this clause in the same manner as facilities or work originally 
completed under the contract.

                             (End of clause)



Sec.  52.246-11  Higher-Level Contract Quality Requirement.

    As prescribed in 46.311, insert the following clause:

          Higher-Level Contract Quality Requirement (FEB 1999)

    The Contractor shall comply with the higher-level quality standard 
selected below. [If more than one standard is listed, the offeror shall 
indicate its selection by checking the appropriate block.]

[[Page 332]]



 
           Title                        Number                       Date                      Tailoring
 
----------------------       ----------------------       ----------------------      ----------------------
----------------------       ----------------------       ----------------------      ----------------------
----------------------       ----------------------       ----------------------      ----------------------
----------------------       ----------------------       ----------------------      ----------------------
 

[Contracting Officer insert the title, number (if any), date, and 
tailoring (if any) of the higher-level quality standards.]

                             (End of clause)

[63 FR 70289, Dec. 18, 1998]



Sec.  52.246-12  Inspection of Construction.

    As prescribed in 46.312, insert the following clause:

                  Inspection of Construction (AUG 1996)

    (a) Definition. Work includes, but is not limited to, materials, 
workmanship, and manufacture and fabrication of components.
    (b) The Contractor shall maintain an adequate inspection system and 
perform such inspections as will ensure that the work performed under 
the contract conforms to contract requirements. The Contractor shall 
maintain complete inspection records and make them available to the 
Government. All work shall be conducted under the general direction of 
the Contracting Officer and is subject to Government inspection and test 
at all places and at all reasonable times before acceptance to ensure 
strict compliance with the terms of the contract.
    (c) Government inspections and tests are for the sole benefit of the 
Government and do not--
    (1) Relieve the Contractor of responsibility for providing adequate 
quality control measures;
    (2) Relieve the Contractor of responsibility for damage to or loss 
of the material before acceptance;
    (3) Constitute or imply acceptance; or
    (4) Affect the continuing rights of the Government after acceptance 
of the completed work under paragraph (i) below.
    (d) The presence or absence of a Government inspector does not 
relieve the Contractor from any contract requirement, nor is the 
inspector authorized to change any term or condition of the 
specification without the Contracting Officer's written authorization.
    (e) The Contractor shall promptly furnish, at no increase in 
contract price, all facilities, labor, and material reasonably needed 
for performing such safe and convenient inspections and tests as may be 
required by the Contracting Officer. The Government may charge to the 
Contractor any additional cost of inspection or test when work is not 
ready at the time specified by the Contractor for inspection or test, or 
when prior rejection makes reinspection or retest necessary. The 
Government shall perform all inspections and tests in a manner that will 
not unnecessarily delay the work. Special, full size, and performance 
tests shall be performed as described in the contract.
    (f) The Contractor shall, without charge, replace or correct work 
found by the Government not to conform to contract requirements, unless 
in the public interest the Government consents to accept the work with 
an appropriate adjustment in contract price. The Contractor shall 
promptly segregate and remove rejected material from the premises.
    (g) If the Contractor does not promptly replace or correct rejected 
work, the Government may (1) by contract or otherwise, replace or 
correct the work and charge the cost to the Contractor or (2) terminate 
for default the Contractor's right to proceed.
    (h) If, before acceptance of the entire work, the Government decides 
to examine already completed work by removing it or tearing it out, the 
Contractor, on request, shall promptly furnish all necessary facilities, 
labor, and material. If the work is found to be defective or 
nonconforming in any material respect due to the fault of the Contractor 
or its subcontractors, the Contractor shall defray the expenses of the 
examination and of satisfactory reconstruction. However, if the work is 
found to meet contract requirements, the Contracting Officer shall make 
an equitable adjustment for the additional services involved in the 
examination and reconstruction, including, if completion of the work was 
thereby delayed, an extension of time.
    (i) Unless otherwise specified in the contract, the Government shall 
accept, as promptly as practicable after completion and inspection, all 
work required by the contract or that portion of the work the 
Contracting Officer determines can be accepted separately. Acceptance 
shall be final and conclusive except for latent defects, fraud, gross 
mistakes amounting to fraud, or the Government's rights under any 
warranty or guarantee.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 51 FR 27120, July 29, 1986; 
60 FR 34762, July 3, 1995; 61 FR 31665, June 20, 1996]

[[Page 333]]



Sec.  52.246-13  Inspection--Dismantling, Demolition, or Removal of Improvements.

    As prescribed in 46.313, insert the following clause in 
solicitations and contracts for dismantling, demolition, or removal of 
improvements:

  Inspection--Dismantling, Demolition, or Removal of Improvements (AUG 
                                  1996)

    (a) Unless otherwise designated by the specifications, all 
workmanship performed under the contract is subject to Government 
inspection at all times and places where dismantling or demolition work 
is being performed. The Contractor shall furnish promptly, and at no 
increase in contract price, all reasonable facilities, labor, and 
materials necessary for safe and convenient inspection by the 
Government. The Government shall perform inspections in a manner that 
will not unduly delay the work.
    (b) The Contractor is responsible for damage to property caused by 
defective workmanship. The Contractor shall promptly segregate and 
remove from the premises any unsatisfactory facilities, materials, and 
equipment used in contract performance, and promptly replace them with 
satisfactory items. If the Contractor fails to proceed at once in a 
workmanlike manner with performance of the work or with the correction 
of defective workmanship, the Government may (1) by contract or 
otherwise, replace the facilities, materials, and equipment or correct 
the workmanship and charge the cost to the Contractor and (2) terminate 
for default the Contractor's right to proceed. The Contractor and any 
surety shall be liable, to the extent specified in the contract for any 
damage or cost of repair or replacement.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 31665, June 20, 1996]



Sec.  52.246-14  Inspection of Transportation.

    As prescribed in 46.314, insert the following clause in 
solicitations and contracts for freight transportation services 
(including local drayage) by rail, motor (including bus), domestic 
freight forwarder, and domestic water carriers (including inland, 
coastwise, and intercoastal). The contracting officer shall not use the 
clause for the acquisition of transportation services by domestic or 
international air carriers or by international ocean carriers, or to 
freight services provided under bills of lading or to those negotiated 
for reduced rates under 49 U.S.C. 1072(b)(1). (See part 47, 
Transportation.)

                 Inspection of Transportation (APR 1984)

    The Government has the right to inspect and test the Contractor's 
services, facilities, and equipment at all reasonable times. The 
Contractor shall furnish Government representatives with the free access 
and reasonable facilities and assistance required to accomplish their 
inspections and tests.

                             (End of clause)



Sec.  52.246-15  Certificate of Conformance.

    As prescribed in 46.315, insert the following clause in 
solicitations and contracts for supplies or services when the conditions 
in 46.504 apply:

                  Certificate of Conformance (APR 1984)

    (a) When authorized in writing by the cognizant Contract 
Administration Office (CAO), the Contractor shall ship with a 
Certificate of Conformance any supplies for which the contract would 
otherwise require inspection at source. In no case shall the 
Government's right to inspect supplies under the inspection provisions 
of this contract be prejudiced. Shipments of such supplies will not be 
made under this contract until use of the Certificate of Conformance has 
been authorized in writing by the CAO, or inspection and acceptance have 
occurred.
    (b) The Contractor's signed certificate shall be attached to or 
included on the top copy of the inspection or receiving report 
distributed to the payment office or attached to the CAO copy when 
contract administration (Block 10 of the DD Form 250) is performed by 
the Defense Contract Administration Services. In addition, a copy of the 
signed certificate shall also be attached to or entered on copies of the 
inspection or receiving report accompanying the shipment.
    (c) The Government has the right to reject defective supplies or 
services within a reasonable time after delivery by written notification 
to the Contractor. The Contractor shall in such event promptly replace, 
correct, or repair the rejected supplies or services at the Contractor's 
expense.
    (d) The certificate shall read as follows:

``I certify that on ---- [insert date], the ------ [insert Contractor's 
name] furnished the supplies or services called for by Contract No. ---- 
via ---- [Carrier] on ---- [identify the bill of lading or shipping 
document] in accordance with all applicable requirements. I further 
certify that the supplies or services are of the quality specified and 
conform in all respects with the contract requirements, including 
specifications, drawings, preservation, packaging, packing, marking 
requirements, and physical item identification (part

[[Page 334]]

number), and are in the quantity shown on this or on the attached 
acceptance document.''
Date of Execution:______________________________________________________
Signature:______________________________________________________________
Title:__________________________________________________________________

                             (End of clause)



Sec.  52.246-16  Responsibility for Supplies.

    As prescribed in 46.316, insert the following clause:

                 Responsibility for Supplies (APR 1984)

    (a) Title to supplies furnished under this contract shall pass to 
the Government upon formal acceptance, regardless of when or where the 
Government takes physical possession, unless the contract specifically 
provides for earlier passage of title.
    (b) Unless the contract specifically provides otherwise, risk of 
loss of or damage to supplies shall remain with the Contractor until, 
and shall pass to the Government upon--
    (1) Delivery of the supplies to a carrier, if transportation is 
f.o.b. origin; or
    (2) Acceptance by the Government or delivery of the supplies to the 
Government at the destination specified in the contract, whichever is 
later, if transportation is f.o.b. destination.
    (c) Paragraph (b) above shall not apply to supplies that so fail to 
conform to contract requirements as to give a right of rejection. The 
risk of loss of or damage to such nonconforming supplies remains with 
the Contractor until cure or acceptance. After cure or acceptance, 
paragraph (b) above shall apply.
    (d) Under paragraph (b) above, the Contractor shall not be liable 
for loss of or damage to supplies caused by the negligence of officers, 
agents, or employees of the Government acting within the scope of their 
employment.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34762, July 3, 1995]



Sec.  52.246-17  Warranty of Supplies of a Noncomplex Nature.

    As prescribed in 46.710(a)(1), insert a clause substantially as 
follows:

         Warranty of Supplies of a Noncomplex Nature (June 2003)

    (a) Definitions. As used in this clause--
    Acceptance means the act of an authorized representative of the 
Government by which the Government assumes for itself, or as an agent of 
another, ownership of existing supplies, or approves specific services 
as partial or complete performance of the contract.
    Supplies means the end items furnished by the Contractor and related 
services required under this contract. The word does not include 
``data.''
    (b) Contractor's obligations. (1) Notwithstanding inspection and 
acceptance by the Government of supplies furnished under this contract, 
or any condition of this contract concerning the conclusiveness thereof, 
the Contractor warrants that for ---- [Contracting Officer shall state 
specific period of time after delivery, or the specified event whose 
occurrence will terminate the warranty period; e.g., the number of miles 
or hours of use, or combinations of any applicable events or periods of 
time]--
    (i) All supplies furnished under this contract will be free from 
defects in material or workmanship and will conform with all 
requirements of this contract; and
    (ii) The preservation, packaging, packing, and marking, and the 
preparation for, and method of, shipment of such supplies will conform 
with the requirements of this contract.
    (2) When return, correction, or replacement is required, 
transportation charges and responsibility for the supplies while in 
transit shall be borne by the Contractor. However, the Contractor's 
liability for the transportation charges shall not exceed an amount 
equal to the cost of transportation by the usual commercial method of 
shipment between the place of delivery specified in this contract and 
the Contractor's plant, and return.
    (3) Any supplies or parts thereof, corrected or furnished in 
replacement under this clause, shall also be subject to the terms of 
this clause to the same extent as supplies initially delivered. The 
warranty, with respect to supplies or parts thereof, shall be equal in 
duration to that in paragraph (b)(1) of this clause and shall run from 
the date of delivery of the corrected or replaced supplies.
    (4) All implied warranties of merchantability and fitness for a 
particular purpose are excluded from any obligation contained in this 
contract.
    (c) Remedies available to the Government. (1) The Contracting 
Officer shall give written notice to the Contractor of any breach of 
warranties in paragraph (b)(1) of this clause within ---- [Contracting 
Officer shall insert specific period of time; e.g., ``45 days of the 
last delivery under this contract,'' or ``45 days after discovery of the 
defect''].
    (2) Within a reasonable time after the notice, the Contracting 
Officer may either--
    (i) Require, by written notice, the prompt correction or replacement 
of any supplies or parts thereof (including preservation, packaging, 
packing, and marking) that do not

[[Page 335]]

conform with the requirements of this contract within the meaning of 
paragraph (b)(1) of this clause; or
    (ii) Retain such supplies and reduce the contract price by an amount 
equitable under the circumstances.
    (3)(i) If the contract provides for inspection of supplies by 
sampling procedures, conformance of supplies or components subject to 
warranty action shall be determined by the applicable sampling 
procedures in the contract. The Contracting Officer--
    (A) May, for sampling purposes, group any supplies delivered under 
this contract;
    (B) Shall require the size of the sample to be that required by 
sampling procedures specified in the contract for the quantity of 
supplies on which warranty action is proposed;
    (C) May project warranty sampling results over supplies in the same 
shipment or other supplies contained in other shipments even though all 
of such supplies are not present at the point of reinspection; provided, 
that the supplies remaining are reasonably representative of the 
quantity on which warranty action is proposed; and
    (D) Need not use the same lot size as on original inspection or 
reconstitute the original inspection lots.
    (ii) Within a reasonable time after notice of any breach of the 
warranties specified in paragraph (b)(1) of this clause, the Contracting 
Officer may exercise one or more of the following options:
    (A) Require an equitable adjustment in the contract price for any 
group of supplies.
    (B) Screen the supplies grouped for warranty action under this 
clause at the Contractor's expense and return all nonconforming supplies 
to the Contractor for correction or replacement.
    (C) Require the Contractor to screen the supplies at locations 
designated by the Government within the contiguous United States and to 
correct or replace all nonconforming supplies.
    (D) Return the supplies grouped for warranty action under this 
clause to the Contractor (irrespective of the f.o.b. point or the point 
of acceptance) for screening and correction or replacement.
    (4)(i) The Contracting Officer may, by contract or otherwise, 
correct or replace the nonconforming supplies with similar supplies from 
another source and charge to the Contractor the cost occasioned to the 
Government thereby if the Contractor--
    (A) Fails to make redelivery of the corrected or replaced supplies 
within the time established for their return; or
    (B) Fails either to accept return of the nonconforming supplies or 
fails to make progress after their return to correct or replace them so 
as to endanger performance of the delivery schedule, and in either of 
these circumstances does not cure such failure within a period of 10 
days (or such longer period as the Contracting Officer may authorize in 
writing) after receipt of notice from the Contracting Officer specifying 
such failure.
    (ii) Instead of correction or replacement by the Government, the 
Contracting Officer may require an equitable adjustment of the contract 
price. In addition, if the Contractor fails to furnish timely 
disposition instructions, the Contracting Officer may dispose of the 
nonconforming supplies for the Contractor's account in a reasonable 
manner. The Government is entitled to reimbursement from the Contractor, 
or from the proceeds of such disposal, for the reasonable expenses of 
the care and disposition of the nonconforming supplies, as well as for 
excess costs incurred or to be incurred.
    (5) The rights and remedies of the Government provided in this 
clause are in addition to and do not limit any rights afforded to the 
Government by any other clause of this contract.

                             (End of clause)

    Alternate I. [Reserved]
    Alternate II (APR 1984). If it is desirable to specify that 
necessary transportation incident to correction or replacement will be 
at the Government's expense (as might be the case if, for example, the 
cost of a warranty would otherwise be prohibitive), substitute a 
paragraph substantially the same as the following paragraph (b)(2) for 
paragraph (b)(2) of the basic clause:

    (2) If correction or replacement is required and transportation of 
supplies in connection with correction or replacement is necessary, 
transportation charges and responsibility for the supplies while in 
transit shall be borne by the Government.

    Alternate III (APR 1984). If the supplies cannot be obtained from 
another source, substitute a paragraph substantially the same as the 
following paragraph (c)(4) for paragraph (c)(4) of the basic clause:

    (4) If the Contractor does not agree as to responsibility to correct 
or replace the supplies delivered, the Contractor shall nevertheless 
proceed in accordance with the written request issued by the Contracting 
Officer under paragraph (c)(2) of this clause to correct or replace the 
defective or nonconforming supplies. In the event it is later determined 
that the supplies were not defective or nonconforming within the terms 
and conditions of this clause, the contract price will be equitably 
adjusted.


[[Page 336]]


    Alternate IV (APR 1984). If a fixed-price incentive contract is 
contemplated, add a paragraph substantially the same as the following 
paragraph(c)(6) to the basic clause:

    (6) All costs incurred or estimated to be incurred by the Contractor 
in complying with this clause shall be considered when negotiating the 
total final price under the Incentive Price Revision clause of this 
contract. After establishment of the total final price, Contractor 
compliance with this clause shall be at no increase in the total final 
price. Any equitable adjustment made under paragraph (c)(2) of this 
clause shall be governed by the paragraph entitled Equitable Adjustments 
Under Other Clauses in the Incentive Price Revision clause of this 
contract.

    Alternate V (APR 1984). If it is anticipated that recovery of the 
warranted item will involve considerable Government expense for 
disassembly and/or reassembly of larger items, add a paragraph 
substantially the same as the following paragraph (c)(6) to the basic 
clause. Redesignate the additional paragraph as (c)(7) if Alternate IV 
is also being used.

    (6) The Contractor shall be liable for the reasonable costs of 
disassembly and/or reassembly of larger items when it is necessary to 
remove the supplies to be inspected and/or returned for correction or 
replacement.

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 38518, Sept. 18, 1990; 
60 FR 48256, Sept. 18, 1995; 66 FR 2136, Jan. 10, 2001; 68 FR 28087, May 
22, 2003]



Sec.  52.246-18  Warranty of Supplies of a Complex Nature.

    As prescribed in 46.710(b)(1), insert a clause substantially as 
follows:

           Warranty of Supplies of a Complex Nature (MAY 2001)

    (a) Definitions. As used in this clause--
    Acceptance means the act of an authorized representative of the 
Government by which the Government assumes for itself, or as an agent of 
another, ownership of existing and identified supplies, or approves 
specific services rendered, as partial or complete performance of the 
contract.
    Supplies means the end items furnished by the Contractor and related 
services required under this contract. The word does not include 
``data.''
    (b) Contractor's obligations. (1) The Contractor warrants that for 
---- [Contracting Officer shall state the specific warranty period after 
delivery, or the specified event whose occurrence will terminate the 
warranty period; e.g., the number of miles or hours of use, or 
combinations of any applicable events or periods of time] all supplies 
furnished under this contract will be free from defects in material and 
workmanship and will conform with all requirements of this contract; 
provided, however, that with respect to Government-furnished property, 
the Contractor's warranty shall extend only to its proper installation, 
unless the Contractor performs some modification or other work on the 
property, in which case the Contractor's warranty shall extend to the 
modification or other work.
    (2) Any supplies or parts thereof corrected or furnished in 
replacement shall be subject to the conditions of this clause to the 
same extent as supplies initially delivered. This warranty shall be 
equal in duration to that set forth in paragraph (b)(1) of this clause 
and shall run from the date of delivery of the corrected or replaced 
supplies.
    (3) The Contractor shall not be obligated to correct or replace 
supplies if the facilities, tooling, drawings, or other equipment or 
supplies necessary to accomplish the correction or replacement have been 
made unavailable to the Contractor by action of the Government. In the 
event that correction or replacement has been directed, the Contractor 
shall promptly notify the Contracting Officer, in writing, of the 
nonavailability.
    (4) The Contractor shall also prepare and furnish to the Government 
data and reports applicable to any correction required (including 
revision and updating of all affected data called for under this 
contract) at no increase in the contract price.
    (5) When supplies are returned to the Contractor, the Contractor 
shall bear the transportation costs from the place of delivery specified 
in the contract (irrespective of the f.o.b. point or the point of 
acceptance) to the Contractor's plant and return.
    (6) All implied warranties of merchantability and fitness for a 
particular purpose are excluded from any obligation contained in this 
contract.
    (c) Remedies available to the Government. (1) In the event of a 
breach of the Contractor's warranty in paragraph (b)(1) of this clause, 
the Government may, at no increase in contract price--
    (i) Require the Contractor, at the place of delivery specified in 
the contract (irrespective of the f.o.b. point or the point of 
acceptance) or at the Contractor's plant, to repair or replace, at the 
Contractor's election, defective or nonconforming supplies; or
    (ii) Require the Contractor to furnish at the Contractor's plant the 
materials or parts and installation instructions required to 
successfully accomplish the correction.
    (2) If the Contracting Officer does not require correction or 
replacement of defective or nonconforming supplies or the Contractor is 
not obligated to correct or replace under

[[Page 337]]

paragraph (b)(3) of this clause, the Government shall be entitled to an 
equitable reduction in the contract price.
    (3) The Contracting Officer shall notify the Contractor in writing 
of any breach of the warranty in paragraph (b) of this clause within --
-- [Contracting Officer shall insert specific period of time in which 
notice shall be given to the Contractor; e.g., 45 days after delivery of 
the nonconforming supplies.; 45 days of the last delivery under this 
contract.; or 45 days after discovery of the defect.] The Contractor 
shall submit to the Contracting Officer a written recommendation within 
---- [Contracting Officer shall insert period of time] as to the 
corrective action required to remedy the breach. After the notice of 
breach, but not later than ---- [Contracting Officer shall insert period 
within which the warranty remedies should be exercised] after receipt of 
the Contractor's recommendation for corrective action, the Contracting 
Officer may, in writing, direct correction or replacement as in 
paragraph (c)(1) of this clause, and the Contractor shall, 
notwithstanding any disagreement regarding the existence of a breach of 
warranty, comply with this direction. If it is later determined that the 
Contractor did not breach the warranty in paragraph (b)(1) of this 
clause, the contract price will be equitably adjusted.
    (4) If supplies are corrected or replaced, the period for 
notification of a breach of the Contractor's warranty in paragraph 
(c)(3) of this clause shall be ---- [Contracting Officer shall insert 
period within which the Contractor must be notified of a breach as to 
corrected or replaced supplies] from the furnishing or return by the 
Contractor to the Government of the corrected or replaced supplies or 
parts thereof, or, if correction or replacement is effected by the 
Contractor at a Government or other activity, for ---- [Contracting 
Officer shall insert period within which the Contractor must be notified 
of a breach of warranty as to corrected or replaced supplies] 
thereafter.
    (5) The rights and remedies of the Government provided in this 
clause are in addition to and do not limit any rights afforded to the 
Government by any other clause of the contract.

                             (End of clause)

    Alternate I [Reserved]
    Alternate II (APR 1984). If it is desirable to specify that 
necessary transportation incident to correction or replacement will be 
at the Government's expense (as might be the case if, for example, the 
cost of a warranty would otherwise be prohibitive), substitute a 
paragraph substantially the same as the following paragraph (b)(5) for 
paragraph (b)(5) of the basic clause:

    (5) If correction or replacement is required and transportation of 
supplies in connection with correction or replacement is necessary, 
transportation charges and responsibility for the supplies while in 
transit shall be borne by the Government.

    Alternate III (APR 1984). If a fixed-price incentive contract is 
contemplated, add a paragraph substantially the same as the following 
paragraph (c)(6) to the basic clause:

    (6) All costs incurred or estimated to be incurred by the Contractor 
in complying with this clause shall be considered when negotiating the 
total final price under the Incentive Price Revision clause of this 
contract. After establishment of the total final price, Contractor 
compliance with this clause shall be at no increase in the total final 
price. Any equitable adjustments made under paragraph (c)(2) of this 
clause shall be governed by the paragraph entitled Equitable Adjustments 
Under Other Clauses in the Incentive Price Revision clause of this 
contract.

    Alternate IV (APR 1984). If it is anticipated that recovery of the 
warranted item will involve considerable Government expense for 
disassembly and/or reassembly of larger items, add a paragraph 
substantially the same as the following paragraph (c)(6) to the basic 
clause. Redesignate the additional paragraph as (c)(7) if Alternate III 
is also used:

    (6) The Contractor shall be liable for the reasonable costs of 
disassembly and/or reassembly of larger items when it is necessary to 
remove the supplies to be inspected and/or returned for correction or 
replacement.

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 48256, Sept. 18, 1995; 
66 FR 2136, Jan. 10, 2001]



Sec.  52.246-19  Warranty of Systems and Equipment under Performance 
Specifications or Design Criteria.

    As prescribed in 46.710(c)(1), the contracting officer may insert a 
clause substantially as follows:

 Warranty of Systems and Equipment Under Performance Specifications or 
                       Design Criteria (MAY 2001)

    (a) Definitions. As used in this clause--
    Acceptance means the act of an authorized representative of the 
Government by which the Government assumes for itself, or as an agent of 
another, ownership of existing and identified supplies, or approves 
specific services rendered, as partial or complete performance of the 
contract.

[[Page 338]]

    Defect means any condition or characteristic in any supplies or 
services furnished by the Contractor under the contract that is not in 
compliance with the requirements of the contract.
    Supplies means the end items furnished by the Contractor and related 
services required under this contract. Except when this contract 
includes the clause entitled Warranty of Data, supplies also mean 
``data.''
    (b) Contractor's obligations. (1) The Contractor's warranties under 
this clause shall apply only to those defects discovered by either the 
Government or the Contractor ---- [Contracting Officer shall state the 
warranty period; e.g., at the time of delivery; within 45 days after 
delivery, or the specified event whose occurrence will terminate the 
warranty period; e.g., the number of miles or hours of use, or 
combination of any applicable events or periods of time.]
    (2) If the Contractor becomes aware at any time before acceptance by 
the Government (whether before or after tender to the Government) that a 
defect exists in any supplies or services, the Contractor shall (i) 
promptly correct the defect or (ii) promptly notify the Contracting 
Officer, in writing, of the defect, using the same procedures prescribed 
in paragraph (b)(3) of this clause.
    (3) If the Contracting Officer determines that a defect exists in 
any of the supplies or services accepted by the Government under this 
contract, the Contracting Officer shall promptly notify the Contractor 
of the defect, in writing, within ---- [Contracting Officer shall insert 
the specific period of time in which notice shall be given to the 
Contractor; e.g., 30 days after delivery of the nonconforming supplies; 
90 days of the last delivery under this contract; or 90 days after 
discovery of the defect.] Upon timely notification of the existence of a 
defect, or if the Contractor independently discovers a defect in 
accepted supplies or services, the Contractor shall submit to the 
Contracting Officer, in writing, within ---- [Contracting Officer shall 
insert period of time] a recommendation for corrective actions, together 
with supporting information in sufficient detail for the Contracting 
Officer to determine what corrective action, if any, shall be 
undertaken.
    (4) The Contractor shall promptly comply with any timely written 
direction from the Contracting Officer to correct or partially correct a 
defect, at no increase in the contract price.
    (5) The Contractor shall also prepare and furnish to the Contracting 
Officer data and reports applicable to any correction required under 
this clause (including revision and updating of all other affected data 
called for under this contract) at no increase in the contract price.
    (6) In the event of timely notice of a decision not to correct or 
only to partially correct, the Contractor shall submit a technical and 
cost proposal within ---- [Contracting Officer shall insert period of 
time] to amend the contract to permit acceptance of the affected 
supplies or services in accordance with the revised requirement, and an 
equitable reduction in the contract price shall promptly be negotiated 
by the parties and be reflected in a supplemental agreement to this 
contract.
    (7) Any supplies or parts thereof corrected or furnished in 
replacement and any services reperformed shall also be subject to the 
conditions of this clause to the same extent as supplies or services 
initially accepted. The warranty, with respect to these supplies, parts, 
or services, shall be equal in duration to that set forth in paragraph 
(b)(1) of this clause, and shall run from the date of delivery of the 
corrected or replaced supplies.
    (8) The Contractor shall not be responsible under this clause for 
the correction of defects in Government-furnished property, except for 
defects in installation, unless the Contractor performs, or is obligated 
to perform, any modifications or other work on such property. In that 
event, the Contractor shall be responsible for correction of defects 
that result from the modifications or other work.
    (9) If the Government returns supplies to the Contractor for 
correction or replacement under this clause, the Contractor shall be 
liable for transportation charges up to an amount equal to the cost of 
transportation by the usual commercial method of shipment from the place 
of delivery specified in this contract (irrespective of the f.o.b. point 
or the point of acceptance) to the Contractor's plant and return to the 
place of delivery specified in this contract. The Contractor shall also 
bear the responsibility for the supplies while in transit.
    (10) All implied warranties of merchantability and fitness for a 
particular purpose are excluded from any obligation under this contract.
    (c) Remedies available to the Government. (1) The rights and 
remedies of the Government provided in this clause--
    (i) Shall not be affected in any way by any terms or conditions of 
this contract concerning the conclusiveness of inspection and 
acceptance; and
    (ii) Are in addition to, and do not limit, any rights afforded to 
the Government by any other clause of this contract.
    (2) Within ---- [Contracting Officer shall insert period of time] 
after receipt of the Contractor's recommendations for corrective action 
and adequate supporting information, the Contracting Officer, using sole 
discretion, shall give the Contractor written notice not to correct any 
defect, or to correct or partially correct any defect within a 
reasonable time at ---- [Contracting Officer shall insert locations 
where corrections may be performed].

[[Page 339]]

    (3) In no event shall the Government be responsible for any 
extension or delays in the scheduled deliveries or periods of 
performance under this contract as a result of the Contractor's 
obligations to correct defects, nor shall there be any adjustment of the 
delivery schedule or period of performance as a result of the correction 
of defects unless provided by a supplemental agreement with adequate 
consideration.
    (4) This clause shall not be construed as obligating the Government 
to increase the contract price.
    (5)(i) The Contracting Officer shall give the Contractor a written 
notice, specifying any failure or refusal of the Contractor to--
    (A) Present a detailed recommendation for corrective action as 
required by paragraph (b)(3) of this clause;
    (B) Correct defects as directed under paragraph (b)(4) of this 
clause; or
    (C) Prepare and furnish data and reports as required by paragraph 
(b)(5) of this clause.
    (ii) The notice shall specify a period of time following receipt of 
the notice by the Contractor in which the Contractor must remedy the 
failure or refusal specified in the notice.
    (6) If the Contractor does not comply with the Contracting Officer's 
written notice in paragraph (c)(5)(i) of this clause, the Contracting 
Officer may by contract or otherwise--
    (i) Obtain detailed recommendations for corrective action and 
either--
    (A) Correct the supplies or services; or
    (B) Replace the supplies or services, and if the Contractor fails to 
furnish timely disposition instructions, the Contracting Officer may 
dispose of the nonconforming supplies for the Contractor's account in a 
reasonable manner, in which case the Government is entitled to 
reimbursement from the Contractor, or from the proceeds, for the 
reasonable expenses of care and disposition, as well as for excess costs 
incurred or to be incurred;
    (ii) Obtain applicable data and reports; and
    (iii) Charge the Contractor for the costs incurred by the 
Government.

                             (End of clause)

    Alternate I (APR 1984). If it is desirable to specify that necessary 
transportation incident to correction or replacement will be at the 
Government's expense (as might be the case if, for example, the cost of 
a warranty would otherwise be prohibitive), substitute a paragraph 
substantially the same as the following paragraph (b)(9) for paragraph 
(b)(9) of the basic clause:

    (9) If correction or replacement is required, and transportation of 
supplies in connection with correction or replacement is necessary, 
transportation charges and responsibility for the supplies while in 
transit shall be borne by the Government.

    Alternate II (APR 1984). If a fixed-price incentive contract is 
contemplated, add a paragraph substantially the same as the following 
paragraph (c)(7) to the basic clause:

    (7) All costs incurred or estimated to be incurred by the Contractor 
in complying with this clause shall be considered when negotiating the 
total final price under the Incentive Price Revision clause of this 
contract. After establishment of the total final price, Contractor 
compliance with this clause shall be at no increase in the total final 
price. Any equitable adjustments made under paragraph (b)(6) of this 
clause shall be governed by the paragraph entitled Equitable Adjustments 
Under Other Clauses in the Incentive Price Revision clause of this 
contract.

    Alternate III (APR 1984). If it is anticipated that recovery of the 
warranted item will involve considerable Government expense for 
disassembly and/or reassembly of larger items, add a paragraph 
substantially the same as the following paragraph (c)(7) to the basic 
clause. Redesignate the additional paragraph as (c)(8) if Alternate II 
is also being used:

    (7) The Contractor shall be liable for the reasonable costs of 
disassembly and/or reassembly of larger items when it is necessary to 
remove the supplies to be inspected and/or returned for correction or 
replacement.

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 48997, Nov. 28, 1989; 
66 FR 2136, Jan. 10, 2001]



Sec.  52.246-20  Warranty of Services.

    As prescribed in 46.710(d), insert a clause substantially as 
follows:

                     Warranty of Services (MAY 2001)

    (a) Definitions Acceptance, as used in this clause, means the act of 
an authorized representative of the Government by which the Government 
assumes for itself, or as an agent of another, ownership of existing and 
identified supplies, or approves specific services, as partial or 
complete performance of the contract.
    (b) Notwithstanding inspection and acceptance by the Government or 
any provision concerning the conclusiveness thereof, the Contractor 
warrants that all services performed under this contract will, at the 
time of acceptance, be free from defects in workmanship and conform to 
the requirements of

[[Page 340]]

this contract. The Contracting Officer shall give written notice of any 
defect or nonconformance to the Contractor ---- [Contracting Officer 
shall insert the specific period of time in which notice shall be given 
to the Contractor; e.g., within 30 days from the date of acceptance by 
the Government,; within 1000 hours of use by the Government,; or other 
specified event whose occurrence will terminate the period of notice, or 
combination of any applicable events or period of time]. This notice 
shall state either (1) that the Contractor shall correct or reperform 
any defective or nonconforming services, or (2) that the Government does 
not require correction or reperformance.
    (c) If the Contractor is required to correct or reperform, it shall 
be at no cost to the Government, and any services corrected or 
reperformed by the Contractor shall be subject to this clause to the 
same extent as work initially performed. If the Contractor fails or 
refuses to correct or reperform, the Contracting Officer may, by 
contract or otherwise, correct or replace with similar services and 
charge to the Contractor the cost occasioned to the Government thereby, 
or make an equitable adjustment in the contract price.
    (d) If the Government does not require correction or reperformance, 
the Contracting Officer shall make an equitable adjustment in the 
contract price.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 66 FR 2136, Jan. 10, 2001]



Sec.  52.246-21  Warranty of Construction.

    As prescribed in 46.710(e)(1), the contracting officer may insert a 
clause substantially as follows in solicitations and contracts when a 
fixed-price construction contract (see 46.705(c)) is contemplated, and 
the use of a warranty clause has been approved under agency procedures:

                   Warranty of Construction (APR 1984)

    (a) In addition to any other warranties in this contract, the 
Contractor warrants, except as provided in paragraph (i) of this clause, 
that work performed under this contract conforms to the contract 
requirements and is free of any defect in 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 a period of 1 year from the 
date of final acceptance of the work. If the Government takes possession 
of any part of the work before final acceptance, this warranty shall 
continue for a period of 1 year 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, workmanship, or design 
furnished.
    (d) The Contractor shall restore any work damaged in fulfilling the 
terms and conditions of this clause. The Contractor's warranty with 
respect to work repaired or replaced will run for 1 year from the date 
of repair or replacement.
    (e) The Contracting Officer shall notify the Contractor, in writing, 
within a reasonable 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 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, if 
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 negligence of the Contractor or 
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 nor for the repair of any damage that results from any 
defect in Government-furnished material or design.
    (j) This warranty shall not limit the Government's rights under the 
Inspection and Acceptance clause of this contract with respect to latent 
defects, gross mistakes, or fraud.

                             (End of clause)

    Alternate I (APR 1984). If the Government specifies in the contract 
the use of any equipment by brand name and

[[Page 341]]

model, the contracting officer may add a paragraph substantially the 
same as the following paragraph (k) to the basic clause:

    (k) Defects in design or manufacture of equipment specified by the 
Government on a brand name and model basis, shall not be included in 
this warranty. In this event, the Contractor shall require any 
subcontractors, manufacturers, or suppliers thereof to execute their 
warranties, in writing, directly to the Government.

[48 FR 42478, Sept. 19, 1983, as amended at 59 FR 11388, Mar. 10, 1994]



Sec.  52.246-22  [Reserved]



Sec.  52.246-23  Limitation of Liability.

    As prescribed in 46.805, insert the following clause:

                   Limitation of Liability (FEB 1997)

    (a) Except as provided in paragraphs (b) and (c) below, and except 
for remedies expressly provided elsewhere in this contract, the 
Contractor shall not be liable for loss of or damage to property of the 
Government (excluding the supplies delivered under this contract) that 
(1) occurs after Government acceptance of the supplies delivered under 
this contract and (2) results from any defects or deficiencies in the 
supplies.
    (b) The limitation of liability under paragraph (a) above shall not 
apply when a defect or deficiency in, or the Government's acceptance of, 
the supplies results from willful misconduct or lack of good faith on 
the part of any of the Contractor's managerial personnel. The term 
Contractor's managerial personnel, as used in this clause, means the 
Contractor's directors, officers, and any of the Contractor's managers, 
superintendents, or equivalent representatives who have supervision or 
direction of--
    (1) All or substantially all of the Contractor's business;
    (2) All or substantially all of the Contractor's operations at any 
one plant, laboratory, or separate location at which the contract is 
being performed; or
    (3) A separate and complete major industrial operation connected 
with the performance of this contract.
    (c) If the Contractor carries insurance, or has established a 
reserve for self-insurance, covering liability for loss or damage 
suffered by the Government through purchase or use of the supplies 
required to be delivered under this contract, the Contractor shall be 
liable to the Government, to the extent of such insurance or reserve, 
for loss of or damage to property of the Government occurring after 
Government acceptance of, and resulting from any defects or deficiencies 
in, the supplies delivered under this contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34762, July 3, 1995; 
61 FR 67426, Dec. 20, 1996]



Sec.  52.246-24  Limitation of Liability--High-Value Items.

    As prescribed in 46.805, insert the following clause:

          Limitation of Liability--High-Value Items (FEB 1997)

    (a) Except as provided in paragraphs (b) through (e) below, and 
notwithstanding any other provision of this contract, the Contractor 
shall not be liable for loss of or damage to property of the Government 
(including the supplies delivered under this contract) that (1) occurs 
after Government acceptance of the supplies delivered under this 
contract and (2) results from any defects or deficiencies in the 
supplies.
    (b) The limitation of liability under paragraph (a) above shall not 
apply when a defect or deficiency in, or the Government's acceptance of, 
the supplies results from willful misconduct or lack of good faith on 
the part of any of the Contractor's managerial personnel. The term 
Contractor's managerial personnel, as used in this clause, means the 
Contractor's directors, officers, and any of the Contractor's managers, 
superintendents, or equivalent representatives who have supervision or 
direction of--
    (1) All or substantially all of the Contractor's business;
    (2) All or substantially all of the Contractor's operations at any 
one plant, laboratory, or separate location at which the contract is 
being performed; or
    (3) A separate and complete major industrial operation connected 
with the performance of this contract.
    (c) If the Contractor carries insurance, or has established a 
reserve for self-insurance, covering liability for loss or damage 
suffered by the Government through purchase or use of the supplies 
required to be delivered under this contract, the Contractor shall be 
liable to the Government, to the extent of such insurance or reserve, 
for loss of or damage to property of the Government occurring after 
Government acceptance of, and resulting from any defects or deficiencies 
in, the supplies delivered under this contract.
    (d)(1) This clause does not diminish the Contractor's obligations, 
to the extent that they arise otherwise under this contract, relating to 
correction, repair, replacement, or other relief for any defect or 
deficiency in supplies delivered under this contract.

[[Page 342]]

    (2) Unless this is a cost-reimbursement contract, if loss or damage 
occurs and correction, repair, or replacement is not feasible or desired 
by the Government, the Contractor shall, as determined by the 
Contracting Officer--
    (i) Pay the Government the amount it would have cost the Contractor 
to make correction, repair, or replacement before the loss or damage 
occurred; or
    (ii) Provide other equitable relief.
    (e) This clause shall not limit or otherwise affect the Government's 
rights under clauses, if included in this contract, that cover--
    (1) Warranty of technical data;
    (2) Ground and flight risks or aircraft flight risks; or
    (3) Government property.

                             (End of clause)

    Alternate I (APR 1984). If the contract is for both high-value items 
and other end items, the contracting officer shall identify the high-
value items by line item and insert the following preamble before 
paragraph (a):

    (This clause shall apply only to those items identified in this 
contract as being subject to this clause.)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34762, July 3, 1995; 
61 FR 67426, Dec. 20, 1996]



Sec.  52.246-25  Limitation of Liability--Services.

    As prescribed in 46.805, insert the following clause:

              Limitation of Liability--Services (FEB 1997)

    (a) Except as provided in paragraphs (b) and (c) below, and except 
to the extent that the Contractor is expressly responsible under this 
contract for deficiencies in the services required to be performed under 
it (including any materials furnished in conjunction with those 
services), the Contractor shall not be liable for loss of or damage to 
property of the Government that (1) occurs after Government acceptance 
of services performed under this contract and (2) results from any 
defects or deficiencies in the services performed or materials 
furnished.
    (b) The limitation of liability under paragraph (a) above shall not 
apply when a defect or deficiency in, or the Government's acceptance of, 
services performed or materials furnished results from willful 
misconduct or lack of good faith on the part of any of the Contractor's 
managerial personnel. The term Contractor's managerial personnel, as 
used in this clause, means the Contractor's directors, officers, and any 
of the Contractor's managers, superintendents, or equivalent 
representatives who have supervision or direction of--
    (1) All or substantially all of the Contractor's business;
    (2) All or substantially all of the Contractor's operations at any 
one plant, laboratory, or separate location at which the contract is 
being performed; or
    (3) A separate and complete major industrial operation connected 
with the performance of this contract.
    (c) If the Contractor carries insurance, or has established a 
reserve for self-insurance, covering liability for loss or damage 
suffered by the Government through the Contractor's performance of 
services or furnishing of materials under this contract, the Contractor 
shall be liable to the Government, to the extent of such insurance or 
reserve, for loss of or damage to property of the Government occurring 
after Government acceptance of, and resulting from any defects and 
deficiencies in, services performed or materials furnished under this 
contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34762, July 3, 1995; 
61 FR 67426, Dec. 20, 1997]



Sec.  52.247-1  Commercial Bill of Lading Notations.

    As prescribed in 47.104-4, insert the following clause:

             Commercial Bill of Lading Notations (APR 1984)

    If the Contracting Officer authorizes supplies to be shipped on a 
commercial bill of lading and the Contractor will be reimbursed these 
transportation costs as direct allowable costs, the Contractor shall 
ensure before shipment is made that the commercial shipping documents 
are annotated with either of the following notations, as appropriate:
    (a) If the Government is shown as the consignor or the consignee, 
the annotation shall be:
    ``Transportation is for the ------ [name the specific agency] and 
the actual total transportation charges paid to the carrier(s) by the 
consignor or consignee are assignable to, and shall be reimbursed by, 
the Government.''
    (b) If the Government is not shown as the consignor or the 
consignee, the annotation shall be:
    ``Transportation is for the ------ [name the specific agency] and 
the actual total transportation charges paid to the carrier(s) by the 
consignor or consignee shall be reimbursed

[[Page 343]]

by the Government, pursuant to cost-reimbursement contract No ---- This 
may be confirmed by contacting ------ [name and address of the contract 
administration office listed in the contract].''

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 48997, Nov. 28, 1989; 
55 FR 38518, Sept. 18, 1990; 60 FR 34762, July 3, 1995]



Sec.  52.247-2  Permits, Authorities, or Franchises.

    As prescribed in 47.207-1(a), insert the following clause:

             Permits, Authorities, or Franchises (JAN 1997)

    (a) The offeror does [squ], does not [squ], hold authorization from 
the Federal Highway Administration (FHWA) or other cognizant regulatory 
body. If authorization is held, it is as follows:

________________________________________________________________________

                        (Name of regulatory body)

________________________________________________________________________

                           (Authorization No.)

    (b) The offeror shall furnish to the Government, if requested, 
copies of the authorization before moving the material under any 
contract awarded. In addition, the offeror shall, at the offeror's 
expense, obtain and maintain any permits, franchises, licenses, and 
other authorities issued by State and local governments.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 62 FR 240, Jan. 2, 1997]



Sec.  52.247-3  Capability to Perform a Contract for the Relocation of 
a Federal Office.

    As prescribed in 47.207-1(b), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services when a Federal office is relocated, to ensure that 
offerors are capable to perform interstate or intrastate moving 
contracts involving the relocation of Federal offices:

Capability to Perform a Contract for the Relocation of a Federal Office 
                               (APR 1984)

    (a) If the move specified in this contract is to be performed by the 
Contractor as a carrier within the borders of more than one State, 
including the District of Columbia, (i.e., an interstate move), the 
Contractor shall have obtained and hold appropriate and current 
operating authority from the Interstate Commerce Commission.
    (b)(1) If the move specified in this contract is to be performed by 
the Contractor as a carrier wholly within the borders of one State or 
the District of Columbia (i.e., an intrastate move), the Contractor 
shall, when required by the State, or the District of Columbia, in which 
the move is to take place, have obtained and hold appropriate and 
current operating authority from that jurisdiction in the form of a 
certificate, permit, or equivalent license to operate.
    (2) If no authority to operate is required by the State or the 
District of Columbia, the Contractor as carrier shall maintain 
facilities, equipment, and a business address within the jurisdiction in 
which the move is to take place. However, if the move is to originate 
and/or terminate within an area of one State, or the District of 
Columbia, that comprises a part of a recognized Commercial Zone (see 49 
CFR 1048) the boundaries of which encompass portions of more than one 
State or the District of Columbia, it shall be sufficient if the 
Contractor as carrier maintains facilities, equipment, and a business 
address within the Commercial Zone and holds appropriate operating 
authority, if required, from the jurisdiction within which the 
Contractor maintains the facilities, equipment, and business address.
    (c) If the move specified in this contract will not be performed by 
the Contractor as carrier, it must be performed for the Contractor by a 
carrier operating under a subcontract with the Contractor. In this case, 
the Contractor shall not be subject to the requirements of paragraphs 
(a) and (b) above, but shall be responsible for requiring and ensuring 
that the subcontractor carrier complies with those requirements in every 
respect.
    (d) The Contractor shall be in compliance with the applicable 
requirements of this clause at least 14 days before the date on which 
performance of the contract shall commence under the terms specified; 
except that, if the period from the date of award of the contract to the 
date that performance shall commence is less than 28 days, the 
Contractor shall comply with the applicable requirements of this clause 
midway between the time of award and the time of commencement of 
performance.

                             (End of clause)

    Alternate I (APR 1984). If a Federal office move is intrastate and 
the contracting officer determines that it is in the Government's 
interest not to apply the requirements for holding or obtaining State 
authority to operate within

[[Page 344]]

the State, and to maintain a facility within the State or Commercial 
zone, delete paragraph (b) of the basic clause and redesignate the 
remaining paragraphs (b) and (c). In the 6th line of the new paragraph 
(b), delete the words paragraphs (a) and (b) above and replace them with 
paragraph (a) above.



Sec.  52.247-4  Inspection of Shipping and Receiving Facilities.

    As prescribed in 47.207-1(c), insert the following provision in 
solicitations for transportation or for transportation-related services 
when it is desired for offerors to inspect the shipping, receiving, or 
other sites to ensure realistic bids:

       Inspection of Shipping and Receiving Facilities (APR 1984)

    (a) Offerors are urged to inspect the shipping and receiving 
facilities where services are to be performed and to satisfy themselves 
regarding all general and local conditions that may affect the cost of 
contract performance.
    (b) Site visits have been scheduled as follows:
________________________________________________________________________
(locations)_____________________________________________________________
(dates)_________________________________________________________________
(times)_________________________________________________________________
    (c) For further information offerors may contact:
(name)__________________________________________________________________
(telephone)_____________________________________________________________

                           (End of provision)



Sec.  52.247-5  Familiarization With Conditions.

    As prescribed in 47.207-1(d), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services to ensure that offerors become familiar with conditions 
under which and where the services will be performed:

               Familiarization With Conditions (APR 1984)

    The offeror shall become familiar with all available information 
regarding difficulties that may be encountered and the conditions, 
including safety precautions, under which the work must be accomplished 
under the contract. The offeror shall not be relieved from assuming all 
responsibility for properly estimating the difficulties and the cost of 
performing the services required in this contract because the offeror 
failed to investigate the conditions or to become acquainted with all 
information concerning the services to be performed.

                             (End of clause)



Sec.  52.247-6  Financial Statement.

    As prescribed in 47.207-1(e), insert the following provision in 
solicitations for transportation or for transportation-related services 
to ensure that offerors are prepared to furnish financial statements:

                     Financial Statement (APR 1984)

    The offeror shall, upon request, promptly furnish the Government 
with a current certified statement of the offeror's financial condition 
and such data as the Government may request with respect to the 
offeror's operations. The Government will use this information to 
determine the offeror's financial responsibility and ability to perform 
under the contract. Failure of an offeror to comply with a request for 
information will subject the offer to possible rejection on 
responsibility grounds.

                           (End of provision)



Sec.  52.247-7  Freight Excluded.

    As prescribed in 47.207-3(d)(2), insert a clause substantially as 
follows in solicitations and contracts for transportation or for 
transportation-related services when any commodities or types of 
shipments have been identified for exclusion:

                       Freight Excluded (APR 1984)

    Excluded from the scope of this contract are shipments that can be 
more advantageously or economically moved via parcel post or small 
package carrier; shipments of unusual value, explosives and other 
dangerous articles, household goods, commodities in bulk, commodities 
injurious or contaminating to other freight; and shipments that the 
Government may elect to move in Government vehicles.

                             (End of clause)



Sec.  52.247-8  Estimated Weights or Quantities Not Guaranteed.

    As prescribed in 47.207-3(e)(2), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services when weights or quantities are estimates:

[[Page 345]]

        Estimated Weights or Quantities Not Guaranteed (APR 1984)

    The estimated weights or quantities are not a guarantee of actual 
weights or quantities, as the Government does not guarantee any 
particular volume of traffic described in this contract. However, to the 
extent services are required as described in this contract and in 
accordance with the terms of this contract, orders for these services 
will be placed with the Contractor.

                             (End of clause)



Sec.  52.247-9  Agreed Weight--General Freight.

    As prescribed in 47.207-4(a)(1), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services when the shipping activity determines the weight of 
shipments of freight other than household goods or office furniture:

                Agreed Weight--General Freight (APR 1984)

    The shipping activity shall determine the weight of each shipment. 
The weight shall be shown on the covering shipping document and shall be 
accepted by the Contractor as the agreed weight.

                             (End of clause)



Sec.  52.247-10  Net Weight--General Freight.

    As prescribed in 47.207-4(a)(2), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services when the weight of shipments of freight other than 
household goods or office furniture is not known at the time of shipment 
and the contractor is responsible for determining the net weight of the 
shipments:

                 Net Weight--General Freight (APR 1984)

    (a) The net weight of the shipment shall be determined by deducting 
the tare weight of the vehicle (determined by having the empty vehicle 
with a full tank of fuel weighed by a certified weighmaster on a 
certified scale) from the gross weight of the vehicle (determined by 
having the loaded vehicle with a full tank of fuel weighed by a 
certified weighmaster on a certified scale).
    (b) The Contractor shall attach the original copies of the empty and 
loaded weight certificates to the invoice for services.

                             (End of clause)



Sec.  52.247-11  Net Weight--Household Goods or Office Furniture.

    As prescribed in 47.207-4(b), insert the following clause in 
contracts for transportation or for transportation-related services when 
movements of Government employees' household goods or relocations of 
Government offices are involved:

       Net Weight--Household Goods or Office Furniture (APR 1984)

    (a) Net weight--full loads. The net weight of the shipment shall be 
determined by deducting the tare weight of the vehicle (determined by 
having a certified weighmaster weigh on a certified scale the empty 
vehicle with all blankets, pads, chains, dollies, hand trucks, and all 
other necessary equipment inside the vehicle) from the gross weight of 
the vehicle (determined by having a certified weighmaster weigh on a 
certified scale the fully loaded vehicle before arrival at destination).
    (b) Net weight--part loads. The net weight of the first part load 
shall be determined in the same manner as specified for a full load. The 
net weight of the second part load shall be determined by using as the 
tare weight of the vehicle the gross weight of the vehicle containing 
the first part load and deducting this weight from the new gross weight 
(determined by having the loaded vehicle weighed again, in the same 
manner as specified for the full load). The same procedure shall apply 
for each succeeding part load.
    (c) Weight certificates. The contractor shall attach the original 
copy of each weight certificate to the invoice for services.

                             (End of clause)



Sec.  52.247-12  Supervision, Labor, or Materials.

    As prescribed in 47.207-5(b), insert a clause substantially as 
follows in solicitations and contracts for transportation or for 
transportation-related services when the contractor is required to 
furnish supervision, labor, or materials:

               Supervision, Labor, or Materials (APR 1984)

    The Contractor shall furnish adequate supervision, labor, materials, 
supplies, and equipment necessary to perform all the services 
contemplated under this contract in an orderly, timely, and efficient 
manner.

[[Page 346]]

                             (End of clause)



Sec.  52.247-13  Accessorial Services--Moving Contracts.

    As prescribed in 47.207-5(c), insert a clause substantially as 
follows in solicitations and contracts for the transportation of 
household goods or office furniture:

            Accessorial Services--Moving Contracts (APR 1984)

    (a) Packing and/or crating and padding. The Contractor shall--
    (1) Perform all of the packing and/or crating and padding necessary 
for the protection of the goods to be transported;
    (2) Furnish packing containers, including, but not limited to, 
barrels, boxes, wardrobes, and cartons; all crating materials; and all 
padding materials and equipment;
    (3) Furnish or cause to be furnished, when necessary, padding or 
other protective material for the interior of the buildings, including 
elevators, from and to which the property will be moved under this 
contract; and
    (4) Ensure that all containers and materials are clean and of 
quality sufficient for protection of the goods.
    (b) Disassembling and reassembling of property and servicing 
appliances. The disassembling of property; e.g., beds and sectional 
bookcases, and the preparing of appliances; e.g., washers, driers, and 
record players, for shipment shall be performed by the Contractor. The 
Contractor shall reassemble the property and service the appliances upon 
delivery at the new location.
    (c) Unpacking and/or uncrating and placement of property. The 
Contractor shall unpack and/or uncrate all property that was packed and/
or crated for movement under this contract. The Contractor shall also 
place the property in the new location as instructed by the owner of the 
property or authorized representative, and shall remove all packing and 
similar or related material from the premises as requested by the owner.

                             (End of clause)



Sec.  52.247-14  Contractor Responsibility for Receipt of Shipment.

    As prescribed in 47.207-5(d), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services:

      Contractor Responsibility for Receipt of Shipment (APR 1984)

    The Contractor shall diligently count and examine all goods tendered 
for shipment, receipt for them, and make appropriate written exception 
for any goods not in apparent good order.

                             (End of clause)



Sec.  52.247-15  Contractor Responsibility for Loading and Unloading.

    As prescribed in 47.207-5(e), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services when the contractor is responsible for loading and 
unloading shipments:

     Contractor Responsibility for Loading and Unloading (APR 1984)

    (a)(1) Unless otherwise specified in this contract to cover store-
door or inside delivery, the Contractor shall load and unload shipments 
at no additional expense to the Government.
    (2) The Government or its agent will place or receive freight at the 
tailgate of the Contractor's vehicle. Tailgate delivery, for purposes of 
this contract, is defined as that which enables a forklift truck or 
similar equipment, with operator only, to place or remove cargo from the 
tailgate of the Contractor's vehicle.
    (b) If loading is the responsibility of the Contractor, the 
Contractor shall perform all shoring, blocking, and bracing. The 
Contractor shall provide dunnage at the Contractor's expense.

                             (End of clause)



Sec.  52.247-16  Contractor Responsibility for Returning Undelivered Freight.

    As prescribed in 47.207-5(f), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services when the contractor is responsible for returning 
undelivered freight:

 Contractor Responsibility for Returning Undelivered Freight (APR 1984)

    (a) When, through no fault of the Contractor, a shipment cannot be 
delivered, the Contractor shall contact the shipper for disposition 
instructions. If the shipment is ordered returned to the origin point, 
the charges assessed for the return trip shall be the same as the 
charges assessed for the outbound trip. The shipper shall maintain a 
record of the goods that, through no fault of the Contractor, could not 
be delivered and are returned to the shipper. If, at a future date, the 
returned goods are determined to be related to a claim against the 
Contractor, the claim will be adjusted accordingly.
    (b) When, through the fault of the Contractor, a shipment cannot be 
delivered, the

[[Page 347]]

Contractor shall return the shipment to the origin point at no charge to 
the Government. Any charges incurred for redelivery, which are in excess 
of the charges that would have been incurred under this contract, shall 
be for the Contractor's account in accordance with the Default clause of 
the contract.

                             (End of clause)



Sec.  52.247-17  Charges.

    As prescribed in 47.207-6(a)(2), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services:

                           Charges (APR 1984)

    In no event shall charges under this contract be in excess of 
charges based on the Contractor's lowest rate available to the general 
public, or be in excess of charges based on rates otherwise tendered to 
the Government by the Contractor for the same type of service.

                             (End of clause)



Sec.  52.247-18  Multiple Shipments.

    As prescribed in 47.207-6(c)(5)(i), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services when multiple shipments are tendered at one time to the 
contractor for transportation from one origin to two or more consignees 
at the same destination:

                      Multiple Shipments (APR 1984)

    When multiple shipments are tendered at one time to the Contractor 
for movement from one origin to multiple consignees at the same 
destination, the rate charged for each shipment shall be the rate 
applicable to the aggregate weight.

                             (End of clause)



Sec.  52.247-19  Stopping in Transit for Partial Unloading.

    As prescribed in 47.207-6(c)(5)(ii), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services when multiple shipments are tendered at one time to the 
contractor for transportation from one origin to two or more consignees 
along the route between origin and last destination:

          Stopping in Transit for Partial Unloading (APR 1984)

    When multiple shipments are tendered at one time to the Contractor 
for movement from one origin to two or more consignees along the route 
between the origin and the last destination, the rate charged shall be 
the rate applicable to the aggregate weight, plus a charge of $---- for 
each shipment unloaded at an intermediate point en route to the last 
destination.

                             (End of clause)



Sec.  52.247-20  Estimated Quantities or Weights for Evaluation of Offers.

    As prescribed in 47.207-6(c)(6), insert the following provision in 
solicitations for transportation or for transportation-related services 
when quantities or weights of shipments between each origin and 
destination are not known, stating estimated quantity or weight for each 
origin/destination pair:

   Estimated Quantities or Weights for Evaluation of Offers (APR 1984)

    For the purpose of evaluating offers, and for no other purpose, the 
following estimated quantities or weights will be considered as the 
quantities or weights to be shipped between each origin and destination 
listed:

 
                                                       Estimated
            Origin                 Destination        quantity or
                                                         weight
 
 
------------------------------------------------------------------------
 
------------------------------------------------------------------------
 
------------------------------------------------------------------------
 

                           (End of provision)



Sec.  52.247-21  Contractor Liability for Personal Injury and/or Property Damage.

    As prescribed in 47.207-7(c), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services:

  Contractor Liability for Personal Injury and/or Property Damage (APR 
                                  1984)

    (a) The Contractor assumes responsibility for all damage or injury 
to persons or property occasioned through the use, maintenance, and 
operation of the Contractor's vehicles or other equipment by, or the 
action of, the Contractor or the Contractor's employees and agents.
    (b) The Contractor, at the Contractor's expense, shall maintain 
adequate public liability and property damage insurance during

[[Page 348]]

the continuance of this contract, insuring the Contractor against all 
claims for injury or damage.
    (c) The Contractor shall maintain Workers' Compensation and other 
legally required insurance with respect to the Contractor's own 
employees and agents.
    (d) The Government shall in no event be liable or responsible for 
damage or injury to any person or property occasioned through the use, 
maintenance, or operation of any vehicle or other equipment by, or the 
action of, the Contractor or the Contractor's employees and agents in 
performing under this contract, and the Government shall be indemnified 
and saved harmless against claims for damage or injury in such cases.

                             (End of clause)



Sec.  52.247-22  Contractor Liability for Loss of and/or Damage to Freight 
Other Than Household Goods.

    As prescribed in 47.207-7(d), insert the following clause in 
solicitations and contracts for the transportation of freight other than 
household goods:

  Contractor Liability for Loss of and/or Damage to Freight Other Than 
                       Household Goods (APR 1984)

    Except when loss and/or damage arises out of causes beyond the 
control and without the fault or negligence of the Contractor, the 
Contractor shall assume full liability for any and all goods lost and/or 
damaged in the movement covered by this contract.

                             (End of clause)



Sec.  52.247-23  Contractor Liability for Loss of and/or Damage to Household Goods.

    As prescribed in 47.207-7(e), insert the following clause:

 Contractor Liability for Loss of and/or Damage to Household Goods (JAN 
                                  1991)

    (a) Except when loss and/or damage arise out of causes beyond the 
control and without the fault or negligence of the Contractor, the 
Contractor shall be liable to the owner for the loss of and/or damage to 
any article while being--
    (1) Packed, picked up, loaded, transported, delivered, unloaded, or 
unpacked;
    (2) Stored in transit; or
    (3) Serviced (appliances, etc.) by a third person hired by the 
Contractor to perform the servicing.
    (b) The Contractor shall be liable for loss and/or damage discovered 
by the owner if written notice of such loss and/or damage is dispatched 
to the Contractor not later than 75 days following the date of delivery.
    (c) The Contractor shall indemnify the owner of the goods at a rate 
of -- cents per pound per article.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 52800, Dec. 21, 1990]



Sec.  52.247-24  Advance Notification by the Government.

    As prescribed in 47.207-8(a)(1), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services when the Government is responsible for notifying the 
contractor of specific service times or unusual shipments:

            Advance Notification by the Government (APR 1984)

    The Government will notify the Contractor -- hours in advance of the 
number of pieces and weight of all normal shipments and the time the 
shipment will be available for pickup. On other-than-normal shipments, 
the Government will furnish additional information; e.g., dimension of 
oversized pieces, as necessary to determine the amount of equipment and/
or manpower needed to perform the required services.

                             (End of clause)



Sec.  52.247-25  Government-Furnished Equipment With or Without Operators.

    As prescribed in 47.207-8(a)(2)(i), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services when the Government furnishes equipment with or without 
operators:

   Government-Furnished Equipment With or Without Operators (APR 1984)

    The Government will provide ------ [insert equipment; e.g., 
forklifts] with or without operators at -- [strike out with or without, 
as applicable, and insert origin, destination, or both] to assist in --
-- [insert loading, unloading, or both], when required.

                             (End of clause)



Sec.  52.247-26  Government Direction and Marking.

    As prescribed in 47.207-8(a)(3), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services when office relocations are involved:

[[Page 349]]

               Government Direction and Marking (APR 1984)

    The agency being relocated shall tag or mark property, showing 
floor, room number, and location where property is to be placed in the 
new building. The agency shall provide sufficient personnel to direct 
the Contractor's personnel in the placement of the property at 
destination.

                             (End of clause)



Sec.  52.247-27  Contract Not Affected by Oral Agreement.

    As prescribed in 47.207-8(b), insert the following clause in 
solicitations and contracts for transportation or for transportation-
related services:

           Contract Not Affected by Oral Agreement (APR 1984)

    No oral statement of any person shall modify or otherwise affect the 
terms, conditions, or specifications stated in this contract. All 
modifications to the contract must be made in writing by the Contracting 
Officer or an authorized representative.

                             (End of clause)



Sec.  52.247-28  Contractor's Invoices.

    As prescribed in 47.207-9(c), insert the following clause in 
solicitations and contracts for drayage or other term contracts for 
transportation or for transportation-related services:

                    Contractor's Invoices (APR 1984)

    The Contractor shall submit itemized invoices as instructed by the 
agency ordering services under this contract. The Contractor shall 
annotate each invoice with the contract number and other ordering office 
document identification.

                             (End of clause)



Sec.  52.247-29  F.o.b. Origin.

    As prescribed in 47.303-1(c), insert the following clause:

                        F.o.b. Origin (JUN 1988)

    (a) The term f.o.b. origin, as used in this clause, means free of 
expense to the Government delivered--
    (1) On board the indicated type of conveyance of the carrier (or of 
the Government, if specified) at a designated point in the city, county, 
and State from which the shipment will be made and from which line-haul 
transportation service (as distinguished from switching, local drayage, 
or other terminal service) will begin;
    (2) To, and placed on, the carrier's wharf (at shipside, within 
reach of the ship's loading tackle, when the shipping point is within a 
port area having water transportation service) or the carrier's freight 
station;
    (3) To a U.S. Postal Service facility; or
    (4) If stated in the solicitation, to any Government-designated 
point located within the same city or commercial zone as the f.o.b. 
origin point specified in the contract (commercial zones are prescribed 
by the Interstate Commerce Commission at 49 CFR 1048).
    (b) The Contractor shall--
    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment in 
conformance with carrier requirements to protect the goods and to ensure 
assessment of the lowest applicable transportation charge;
    (2)(i) Order specified carrier equipment when requested by the 
Government; or
    (ii) If not specified, order appropriate carrier equipment not in 
excess of capacity to accommodate shipment;
    (3) Deliver the shipment in good order and condition to the carrier, 
and load, stow, trim, block, and/or brace carload or truckload shipment 
(when loaded by the Contractor) on or in the carrier's conveyance as 
required by carrier rules and regulations;
    (4) Be responsible for any loss of and/or damage to the goods--
    (i) Occurring before delivery to the carrier;
    (ii) Resulting from improper packing and marking; or
    (iii) Resulting from improper loading, stowing, trimming, blocking, 
and/or bracing of the shipment, if loaded by the Contractor on or in the 
carrier's conveyance;
    (5) Complete the Government bill of lading supplied by the ordering 
agency or, when a Government bill of lading is not supplied, prepare a 
commercial bill of lading or other transportation receipt. The bill of 
lading shall show--
    (i) A description of the shipment in terms of the governing freight 
classification or tariff (or Government rate tender) under which lowest 
freight rates are applicable;
    (ii) The seals affixed to the conveyance with their serial numbers 
or other identification;
    (iii) Lengths and capacities of cars or trucks ordered and 
furnished;
    (iv) Other pertinent information required to effect prompt delivery 
to the consignee, including name, delivery address, postal address and 
ZIP code of consignee, routing, etc.;
    (v) Special instructions or annotations requested by the ordering 
agency for commercial bills of lading; e.g., (A) to be converted to a 
Government bill of lading, or (B) this shipment is the property of, and 
the freight charges paid to the carrier(s) will be reimbursed by, the 
Government; and

[[Page 350]]

    (vi) The signature of the carrier's agent and the date the shipment 
is received by the carrier; and
    (6) Distribute the copies of the bill of lading, or other 
transportation receipts, as directed by the ordering agency.
    (c) These Contractor responsibilities are specified for performance 
at the plant or plants at which the supplies are to be finally inspected 
and accepted, unless the facilities for shipment by carrier's equipment 
are not available at the Contractor's plant, in which case the 
responsibilities shall be performed f.o.b. the point or points in the 
same or nearest city where the specified carrier's facilities are 
available; subject, however, to the following qualifications:
    (1) If the Contractor's shipping plant is located in the State of 
Alaska or Hawaii, the Contractor shall deliver the supplies listed for 
shipment outside Alaska or Hawaii to the port of loading in Alaska or 
Hawaii, respectively, as specified in the contract, at Contractor's 
expense, and to that extent the contract shall be f.o.b. destination.
    (2) Notwithstanding subparagraph (c)(1) of this clause, if the 
Contractor's shipping plant is located in the State of Hawaii, and the 
contract requires delivery to be made by container service, the 
Contractor shall deliver the supplies, at the Contractor's expense, to 
the container yard in the same or nearest city where seavan container 
service is available.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 53 FR 17860, May 18, 1988]



Sec.  52.247-30  F.o.b. Origin, Contractor's Facility.

    As prescribed in 47.303-2(c), insert the following clause in 
solicitations and contracts when the delivery term is f.o.b. origin, 
contractor's facility:

             F.o.b. Origin, Contractor's Facility (APR 1984)

    (a) The term f.o.b. origin, contractor's facility, as used in this 
clause, means free of expense to the Government delivered on board the 
indicated type of conveyance of the carrier (or of the Government, if 
specified) at the designated facility, on the named street or highway, 
in the city, county, and State from which the shipment will be made.
    (b) The Contractor shall--
    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment in 
conformance with carrier requirements to protect the goods and to ensure 
assessment of the lowest applicable transportation charge;
    (2)(i) Order specified carrier equipment when requested by the 
Government; or
    (ii) If not specified, order appropriate carrier equipment not in 
excess of capacity to accommodate shipment;
    (3) Deliver the shipment in good order and condition to the carrier, 
and load, stow, trim, block, and/or brace carload or truckload shipment 
(when loaded by the Contractor) on or in the carrier's conveyance as 
required by carrier rules and regulations;
    (4) Be responsible for any loss of and/or damage to the goods--
    (i) Occurring before delivery to the carrier;
    (ii) Resulting from improper packing and marking; or
    (iii) Resulting from improper loading, stowing, trimming, blocking, 
and/or bracing of the shipment, if loaded by the Contractor on or in the 
carrier's conveyance;
    (5) Complete the Government bill of lading supplied by the ordering 
agency or, when a Government bill of lading is not supplied, prepare a 
commercial bill of lading or other transportation receipt. The bill of 
lading shall show--
    (i) A description of the shipment in terms of the governing freight 
classification or tariff (or Government rate tender) under which lowest 
freight rates are applicable;
    (ii) The seals affixed to the conveyance with their serial numbers 
or other identification;
    (iii) Lengths and capacities of cars or trucks ordered and 
furnished;
    (iv) Other pertinent information required to effect prompt delivery 
to the consignee, including name, delivery address, postal address and 
ZIP code of consignee, routing, etc.;
    (v) Special instructions or annotations requested by the ordering 
agency for commercial bills of lading; e.g., (A) to be converted to a 
Government bill of lading, or (B) this shipment is the property of, and 
the freight charges paid to the carrier(s) will be reimbursed by, the 
Government; and
    (vi) The signature of the carrier's agent and the date the shipment 
is received by the carrier; and
    (6) Distribute the copies of the bill of lading, or other 
transportation receipts, as directed by the ordering agency.

                             (End of clause)



Sec.  52.247-31  F.o.b. Origin, Freight Allowed.

    As prescribed in 47.303-3(c), insert the following clause:

                F.o.b. Origin, Freight Allowed (JUN 1988)

    (a) The term f.o.b. origin, freight allowed, as used in this clause, 
means--
    (1) Free of expense to the Government delivered--

[[Page 351]]

    (i) On board the indicated type of conveyance of the carrier (or of 
the Government, if specified) at a designated point in the city, county, 
and State from which the shipments will be made and from which line-haul 
transportation service (as distinguished from switching, local drayage, 
or other terminal service) will begin;
    (ii) To, and placed on, the carrier's wharf (at shipside within 
reach of the ship's loading tackle when the shipping point is within a 
port area having water transportation service) or the carrier's freight 
station;
    (iii) To a U.S. Postal Service facility; or
    (iv) If stated in the solicitation, to any Government-designated 
point located within the same city or commercial zone as the f.o.b. 
origin point specified in the contract (commercial zones are prescribed 
by the Interstate Commerce Commission at 49 CFR 1048); and
    (2) An allowance for freight, based on applicable published tariff 
rates (or Government rate tenders) between the points specified in the 
contract, is deducted from the contract price.
    (b) The Contractor shall--
    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment in 
conformance with carrier requirements to protect the goods and to ensure 
assessment of the lowest applicable transportation charge;
    (2)(i) Order specified carrier equipment when requested by the 
Government; or
    (ii) If not specified, order appropriate carrier equipment not in 
excess of capacity to accommodate shipment;
    (3) Deliver the shipment in good order and condition to the carrier, 
and load, stow, trim, block, and/or brace carload or truckload shipment 
(when loaded by the Contractor) on or in the carrier's conveyance as 
required by carrier rules and regulations;
    (4) Be responsible for any loss of and/or damage to the goods--
    (i) Occurring before delivery to the carrier;
    (ii) Resulting from improper packing and marking; or
    (iii) Resulting from improper loading, stowing, trimming, blocking, 
and/or bracing of the shipment, if loaded by the Contractor on or in the 
carrier's conveyance;
    (5) Complete the Government bill of lading supplied by the ordering 
agency, or when a Government bill of lading is not supplied, prepare a 
commercial bill of lading or other transportation receipt. The bill of 
lading shall show--
    (i) A description of the shipment in terms of the governing freight 
classification or tariff (or Government rate tender) under which lowest 
freight rates are applicable;
    (ii) The seals affixed to the conveyance with their serial numbers 
or other identification;
    (iii) Lengths and capacities of cars or trucks ordered and 
furnished;
    (iv) Other pertinent information required to effect prompt delivery 
to the consignee, including name, delivery address, postal address and 
ZIP code of consignee, routing, etc.;
    (v) Special instructions or annotations requested by the ordering 
agency for commercial bills of lading; e.g., (A) to be converted to a 
Government bill of lading, or (B) this shipment is the property of, and 
the freight charges paid to the carrier(s) will be reimbursed by, the 
Government; and
    (vi) The signature of the carrier's agent and the date the shipment 
is received by the carrier; and
    (6) Distribute the copies of the bill of lading, or other 
transportation receipts, as directed by the ordering agency.
    (c) These Contractor responsibilities are specified for performance 
at the plant or plants at which the supplies are to be finally inspected 
and accepted, unless the facilities for shipment by carrier's equipment 
are not available at the Contractor's plant, in which case the 
responsibilities shall be performed f.o.b. the point or points in the 
same or nearest city where the specified carrier's facilities are 
available; subject, however, to the following qualifications:
    (1) If the Contractor's shipping plant is located in the State of 
Alaska or Hawaii, the Contractor shall deliver the supplies listed for 
shipment outside Alaska or Hawaii to the port of loading in Alaska or 
Hawaii, respectively, as specified in the contract, at Contractor's 
expense, and to that extent the contract shall be f.o.b. destination.
    (2) Notwithstanding subparagraph (c)(1) of this clause, if the 
Contractor's shipping plant is located in the State of Hawaii, and the 
contract requires delivery to be made by container service, the 
Contractor shall deliver the supplies, at Contractor's expense, to the 
container yard in the same or nearest city where seavan container 
service is available.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 53 FR 17860, May 18, 1988]



Sec.  52.247-32  F.o.b. Origin, Freight Prepaid.

    As prescribed in 47.303-4(c), insert the following clause:

                F.o.b. Origin, Freight Prepaid (JUN 1988)

    (a) The term f.o.b. origin, freight prepaid, as used in this clause, 
means--
    (1) Free of expense to the Government delivered--
    (i) On board the indicated type of conveyance of the carrier (or of 
the Government if

[[Page 352]]

specified) at a designated point in the city, county, and State from 
which the shipments will be made and from which line-haul transportation 
service (as distinguished from switching, local drayage, or other 
terminal service) will begin;
    (ii) To, and placed on, the carrier's wharf (at shipside, within 
reach of the ship's loading tackle, when the shipping point is within a 
port area having water transportation service) or the carrier's freight 
station;
    (iii) To a U.S. Postal Service facility; or
    (iv) If stated in the solicitation, to any Government-designated 
point located within the same city or commercial zone as the f.o.b. 
origin point specified in the contract (commercial zones are prescribed 
by the Interstate Commerce Commission at 49 CFR 1048); and
    (2) The cost of transportation, ultimately the Government's 
obligation, is prepaid by the contractor to the point specified in the 
contract.
    (b) The Contractor shall--
    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment in 
conformance with carrier requirements to protect the goods and to ensure 
assessment of the lowest applicable transportation charge;
    (2)(i) Order specified carrier equipment when requested by the 
Government; or
    (ii) If not specified, order appropriate carrier equipment not in 
excess of capacity to accommodate shipment;
    (3) Deliver the shipment in good order and condition to the carrier, 
and load, stow, trim, block, and/or brace carload or truckload shipment 
(when loaded by the Contractor) on or in the carrier's conveyance as 
required by carrier rules and regulations;
    (4) Be responsible for any loss of and/or damage to the goods--
    (i) Occurring before delivery to the carrier;
    (ii) Resulting from improper packing or marking; or
    (iii) Resulting from improper loading, stowing, trimming, blocking, 
and/or bracing of the shipment, if loaded by the Contractor on or in the 
carrier's conveyance;
    (5) Prepare a commercial bill of lading or other transportation 
receipt. The bill of lading shall show--
    (i) A description of the shipment in terms of the governing freight 
classification or tariff (or Government rate tender) under which lowest 
freight rates are applicable;
    (ii) The seals affixed to the conveyance with their serial numbers 
or other identification;
    (iii) Lengths and capacities of cars or trucks ordered and 
furnished;
    (iv) Other pertinent information required to effect prompt delivery 
to the consignee, including name, delivery address, postal address and 
ZIP code of consignee, routing, etc.;
    (v) Special instructions or annotations requested by the ordering 
agency for commercial bills of lading; e.g., (A) to be converted to a 
Government bill of lading, or (B) this shipment is the property of, and 
the freight charges paid to the carrier(s) will be reimbursed by, the 
Government; and
    (vi) The signature of the carrier's agent and the date the shipment 
is received by the carrier;
    (6) Distribute the copies of the bill of lading, or other 
transportation receipts, as directed by the ordering agency; and
    (7) Prepay all freight charges to the extent specified in the 
contract.
    (c) These Contractor responsibilities are specified for performance 
at the plant or plants at which these supplies are to be finally 
inspected and accepted, unless the facilities for shipment by carrier's 
equipment are not available at the Contractor's plant, in which case the 
responsibilities shall be performed f.o.b. the point or points in the 
same or nearest city where the specified carrier's facilities are 
available; subject, however, to the following qualifications:
    (1) If the Contractor's shipping plant is located in the State of 
Alaska or Hawaii, the Contractor shall deliver the supplies listed for 
shipment outside Alaska or Hawaii to the port of loading in Alaska or 
Hawaii, respectively, as specified in the contract, at Contractor's 
expense, and to that extent the contract shall be f.o.b. destination.
    (2) Notwithstanding subparagraph (c)(1) of this clause, if the 
Contractor's shipping plant is located in the State of Hawaii, and the 
contract requires delivery to be made by container service, the 
Contractor shall deliver the supplies, at the Contractor's expense to 
the container yard in the same or nearest city where seavan container 
service is available.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 53 FR 17860, May 18, 1988]



Sec.  52.247-33  F.o.b. Origin, With Differentials.

    As prescribed in 47.303-5(c), insert the following clause:

              F.o.b. Origin, With Differentials (JUN 1988)

    (a) The term f.o.b. origin, with differentials, as used in this 
clause, means--
    (1) Free of expense to the Government delivered--
    (i) On board the indicated type of conveyance of the carrier (or of 
the Government, if specified) at a designated point in the city, county, 
and State from which the shipments

[[Page 353]]

will be made and from which line-haul transportation service (as 
distinguished from switching, local drayage, or other terminal service) 
will begin;
    (ii) To, and placed on, the carrier's wharf (at shipside, within 
reach of the ship's loading tackle, when the shipping point is within a 
port area having water transportation service) or the carrier's freight 
station;
    (iii) To a U.S. Postal Service facility; or
    (iv) If stated in the solicitation, to any Government-designated 
point located within the same city or commercial zone as the f.o.b. 
origin point specified in the contract (commercial zones are prescribed 
by the Interstate Commerce Commission at 49 CFR 1048); and
    (2) Differentials for mode of transportation, type of vehicle, or 
place of delivery as indicated in Contractor's offer may be added to the 
contract price.
    (b) The Contractor shall--
    (1)(i) Pack and mark the shipment to comply with contract 
specification; or
    (ii) In the absence of specifications, prepare the shipment in 
conformance with carrier requirements to protect the goods and to ensure 
assessment of the lowest applicable transportation charge;
    (2)(i) Order specified carrier equipment when requested by the 
Government; or
    (ii) If not specified, order appropriate carrier equipment not in 
excess of capacity to accommodate shipment;
    (3) Deliver the shipment in good order and condition to the carrier, 
and load, stow, trim, block, and/or brace carload or truckload shipment 
(when loaded by the Contractor) on or in the carrier's conveyance as 
required by carrier rules and regulations;
    (4) Be responsible for any loss of and/or damage to the goods--
    (i) Occurring before delivery to the carrier;
    (ii) Resulting from improper packing and marking; or
    (iii) Resulting from improper loading, stowing, trimming, blocking, 
and/or bracing of the shipment, if loaded by the Contractor on or in the 
carrier's conveyance;
    (5) Complete the Government bill of lading supplied by the ordering 
agency or, when a Government bill of lading is not supplied, prepare a 
commercial bill of lading or other transportation receipt. The bill of 
lading shall show--
    (i) A description of the shipment in terms of the governing freight 
classification or tariff (or Government rate tender) under which lowest 
freight rates are applicable;
    (ii) The seals affixed to the conveyance with their serial numbers 
or other identification;
    (iii) Lengths and capacities of cars or trucks ordered and 
furnished;
    (iv) Other pertinent information required to effect prompt delivery 
to the consignee, including name, delivery address, postal address and 
ZIP code of consignee, routing, etc.;
    (v) Special instructions or annotations requested by the ordering 
agency for commercial bills of lading; e.g., (A) to be converted to a 
Government bill of lading, or (B) this shipment is the property of, and 
the freight charges paid to the carrier(s) will be reimbursed by, the 
Government; and
    (vi) The signature of the carrier's agent and the date the shipment 
is received by carrier; and
    (6) Distribute the copies of the bill of lading, or other 
transportation receipts, as directed by the ordering agency.
    (c)(1) It may be advantageous to the offeror to submit f.o.b. origin 
prices that include only the lowest cost to the Contractor for loading 
of shipment at the Contractor's plant or most favorable shipping point. 
The cost beyond that plant or point of bringing the supplies to the 
place of delivery and the cost of loading, blocking, and bracing on the 
type vehicle specified by the Government at the time of shipment may 
exceed the offeror's lowest cost when the offeror ships for the 
offeror's account. Accordingly, the offeror may indicate differentials 
that may be added to the offered price. These differentials shall be 
expressed as a rate in cents for each 100 pounds (CWT) of the supplies 
for one or more of the options under this clause that the Government may 
specify at the time of shipment.
    (2) These differential(s) will be considered in the evaluation of 
offers to determine the lowest overall cost to the Government. If, at 
the time of shipment, the Government specifies (normally on a Government 
bill of lading) a mode of transportation, type of vehicle, or place of 
delivery for which the offeror has set forth a differential, the 
Contractor shall include the total of such differential costs (the 
applicable differential multiplied by the actual weight on the 
Government bill of lading) as a separate reimbursable item on the 
Contractor's invoice for the supplies.
    (3) The Government shall have the option of performing or arranging 
at its own expense any transportation from Contractor's shipping plant 
or point to carrier's facility at the time of shipment and, whenever 
this option is exercised, the Government shall make no reimbursement 
based on a quoted differential.
    (4) Offeror's differentials in cents for each 100 pounds for 
optional mode of transportation, types of vehicle, transportation within 
a mode, or place of delivery, specified by the Government at the time of 
shipment and not included in the f.o.b. origin price indicated in the 
Schedule by the offeror, are as follows:
------ (carload, truckload, less-load,
---- wharf, flatcar, driveaway, etc.)

[[Page 354]]

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 53 FR 17861, May 18, 1988]



Sec.  52.247-34  F.o.b. Destination.

    As prescribed in 47.303-6(c), insert the following clause:

                      F.o.b. Destination (JAN 1991)

    (a) The term f.o.b. destination, as used in this clause, means--
    (1) Free of expense to the Government, on board the carrier's 
conveyance, at a specified delivery point where the consignee's facility 
(plant, warehouse, store, lot, or other location to which shipment can 
be made) is located; and
    (2) Supplies shall be delivered to the destination consignee's wharf 
(if destination is a port city and supplies are for export), warehouse 
unloading platform, or receiving dock, at the expense of the Contractor. 
The Government shall not be liable for any delivery, storage, demurrage, 
accessorial, or other charges involved before the actual delivery (or 
``constructive placement'' as defined in carrier tariffs) or the 
supplies to the destination, unless such charges are caused by an act or 
order of the Government acting in its contractual capacity. If rail 
carrier is used, supplies shall be delivered to the specified unloading 
platform of the consignee. If motor carrier (including ``piggyback'') is 
used, supplies shall be delivered to truck tailgate at the unloading 
platform of the consignee, except when the supplies delivered meet the 
requirements of Item 568 of the National Motor Freight Classification 
for ``heavy or bulky freight.'' When supplies meeting the requirements 
of the referenced Item 568 are delivered, unloading (including movement 
to the tailgate) shall be performed by the consignee, with assistance 
from the truck driver, if requested. If the contractor uses rail carrier 
or freight forwarder for less than carload shipments, the contractor 
shall ensure that the carrier will furnish tailgate delivery, when 
required, if transfer to truck is required to complete delivery to 
consignee.
    (b) The Contractor shall--
    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment in 
conformance with carrier requirements;
    (2) Prepare and distribute commercial bills of lading;
    (3) Deliver the shipment in good order and condition to the point of 
delivery specified in the contract;
    (4) Be responsible for any loss of and/or damage to the goods 
occurring before receipt of the shipment by the consignee at the 
delivery point specified in the contract;
    (5) Furnish a delivery schedule and designate the mode of delivering 
carrier; and
    (6) Pay and bear all charges to the specified point of delivery.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 52800, Dec. 21, 1990]



Sec.  52.247-35  F.o.b. Destination, Within Consignee's Premises.

    As prescribed in 47.303-7(c), insert the following clause in 
solicitations and contracts when the delivery term is f.o.b. 
destination, within consignee's premises:

       F.o.b. Destination, Within Consignee's Premises (APR 1984)

    (a) The term f.o.b. destination, within consignee's premises, as 
used in this clause, means free of expense to the Government delivered 
and laid down within the doors of the consignee's premises, including 
delivery to specific rooms within a building if so specified.
    (b) The Contractor shall--
    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment in 
conformance with carrier requirements;
    (2) Prepare and distribute commercial bills of lading;
    (3) Deliver the shipment in good order and condition to the point of 
delivery specified in the contract;
    (4) Be responsible for any loss of and/or damage to the goods 
occurring before receipt of the shipment by the consignee at the 
delivery point specified in the contract;
    (5) Furnish a delivery schedule and designate the mode of delivering 
carrier; and
    (6) Pay and bear all charges to the specified point of delivery.

                             (End of clause)



Sec.  52.247-36  F.a.s. Vessel, Port of Shipment.

    As prescribed in 47.303-8(c), insert the following clause in 
solicitations and contracts when the delivery term is f.a.s. vessel, 
port of shipment:

               F.a.s. Vessel, Port of Shipment (APR 1984)

    (a) The term f.a.s. vessel, port of shipment, as used in this 
clause, means free of expense to the Government delivered alongside the 
ocean vessel and within reach of its loading tackle at the specified 
port of shipment.
    (b) The Contractor shall--

[[Page 355]]

    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment for 
ocean transportation in conformance with carrier requirements to protect 
the goods and to ensure assessment of the lowest applicable 
transportation charge;
    (2)(i) Deliver the shipment in good order and condition alongside 
the ocean vessel and within reach of its loading tackle, at the point of 
delivery and on the date or within the period specified in the contract; 
and
    (ii) Pay and bear all applicable charges, including transportation 
costs, wharfage, handling, and heavy lift charges, if necessary, up to 
this point;
    (3) Provide a clean dock or ship's receipt;
    (4) Be responsible for any loss of and/or damage to the goods 
occurring before delivery of the shipment to the point specified in the 
contract; and
    (5) At the Government's request and expense, assist obtaining the 
documents required for (i) exportation or (ii) importation at 
destination.

                             (End of clause)



Sec.  52.247-37  F.o.b. Vessel, Port of Shipment.

    As prescribed in 47.303-9(c), insert the following clause in 
solicitations and contracts when the delivery term is f.o.b. vessel, 
port of shipment:

               F.o.b. Vessel, Port of Shipment (APR 1984)

    (a) The term f.o.b. vessel, port of shipment, as used in this 
clause, means free of expense to the Government loaded, stowed, and 
trimmed on board the ocean vessel at the specified port of shipment.
    (b) The Contractor shall--
    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment for 
ocean transportation in conformance with carrier requirements to protect 
the goods and to ensure assessment of the lowest applicable 
transportation charge;
    (2)(i) Deliver the shipment on board the ocean vessel in good order 
and condition on the date or within the period fixed; and
    (ii) Pay and bear all charges incurred in placing the shipment 
actually on board;
    (3) Provide a clean ship's receipt or on-board ocean bill of lading;
    (4) Be responsible for any loss of and/or damage to the goods 
occurring before delivery of the shipment on board the ocean vessel; and
    (5) At the Government's request and expense, assist in obtaining the 
documents required for (i) exportation or (ii) importation at 
destination.

                             (End of clause)



Sec.  52.247-38  F.o.b. Inland Carrier, Point of Exportation.

    As prescribed in 47.303-10(c), insert the following clause in 
solicitations and contracts when the delivery term is f.o.b. inland 
carrier, point of exportation:

         F.o.b. Inland Carrier, Point of Exportation (APR 1984)

    (a) The term f.o.b. inland carrier, point of exportation, as used in 
this clause, means free of expense to the Government, on board the 
conveyance of the inland carrier, delivered to the specified point of 
exportation.
    (b) The Contractor shall--
    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment for 
ocean transportation in conformance with carrier requirements to protect 
the goods and to ensure assessment of the lowest applicable 
transportation charge;
    (2) Prepare and distribute commercial bills of lading;
    (3)(i) Deliver the shipment in good order and condition in or on the 
conveyance of the carrier on the date or within the period specified; 
and
    (ii) Pay and bear all applicable charges, including transportation 
costs, to the point of delivery specified in the contract;
    (4) Be responsible for any loss of and/or damage to the goods 
occurring before delivery of the shipment to the point of delivery in 
the contract; and
    (5) At the Government's request and expense, assist in obtaining the 
documents required for (i) exportation or (ii) importation at 
destination.

                             (End of clause)



Sec.  52.247-39  F.o.b. Inland Point, Country of Importation.

    As prescribed in 47.303-11(c), insert the following clause in 
solicitations and contracts when the delivery term is f.o.b. inland 
point, country of importation:

         F.o.b. Inland Point, Country of Importation (APR 1984)

    (a) The term f.o.b. inland point, country of importation, as used in 
this clause, means free of expense to the Government, on board the 
indicated type of conveyance of the carrier, delivered to the specified 
inland point where the consignee's facility is located.
    (b) The Contractor shall--

[[Page 356]]

    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment for 
ocean transportation in conformance with carrier requirements to protect 
the goods;
    (2)(i) Deliver, in or on the inland carrier's conveyance, the 
shipment in good order and condition to the specified inland point where 
the consignee's facility is located; and
    (ii) Pay and bear all applicable charges incurred up to the point of 
delivery, including transportation costs; export, import, or other fees 
or taxes; costs of landing; wharfage costs; customs duties and costs of 
certificates of origin; consular invoices; and other documents that may 
be required for importation; and
    (3) Be responsible for any loss of and/or damage to the goods until 
their arrival on or in the carrier's conveyance at the specified inland 
point.

                             (End of clause)



Sec.  52.247-40  Ex Dock, Pier, or Warehouse, Port of Importation.

    As prescribed in 47.303-12(c), insert the following clause in 
solicitations and contracts when the delivery term is ex dock, pier, or 
warehouse, port of importation:

       Ex Dock, Pier, or Warehouse, Port of Importation (APR 1984)

    (a) The term ex dock, pier, or warehouse, port of importation, as 
used in this clause, means free of expense to the Government delivered 
on the designated dock or pier or in the warehouse at the specified port 
of importation.
    (b) The Contractor shall--
    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment for 
ocean transportation in conformance with carrier requirements to protect 
the goods;
    (2)(i) Deliver shipment in good order and condition; and
    (ii) Pay and bear all charges up to the point of delivery specified 
in the contract, including transportation costs; export, import, or 
other fees or taxes; costs of wharfage and landing, if any; customs 
duties; and costs of certificates of origin, consular invoices, or other 
documents that may be required for exportation or importation; and
    (3) Be responsible for any loss of and/or damage to the goods 
occurring before delivery of the shipment to the point of delivery 
specified in the contract.

                             (End of clause)



Sec.  52.247-41  C.& f. Destination.

    As prescribed in 47.303-13(c), insert the following clause in 
solicitations and contracts when the delivery term is c.& f. 
destination:

                      C.& f. Destination (APR 1984)

    (a) The term c.& f. destination, as used in this clause, means free 
of expense to the Government delivered on board the ocean vessel to the 
specified point of destination, with the cost of transportation paid by 
the Contractor.
    (b) The Contractor shall--
    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment for 
ocean transportation in conformance with carrier requirements;
    (2)(i) Deliver the shipment in good order and condition; and
    (ii) Pay and bear all applicable charges to the point of destination 
specified in the contract, including transportation costs and export 
taxes or other fees or charges levied because of exportation;
    (3) Obtain and dispatch promptly to the Government clean on-board 
ocean bills of lading to the specified point of destination;
    (4) Be responsible for any loss of and/or damage to the goods 
occurring before delivery; and
    (5) At the Government's request and expense, provide certificates of 
origin, consular invoices, or any other documents issued in the country 
of origin or of shipment, or both, that may be required for importation 
into the country of destination.

                             (End of clause)



Sec.  52.247-42  C.i.f. Destination.

    As prescribed in 47.303-14(c), insert the following clause in 
solicitations and contracts when the delivery term is c.i.f. 
destination:

                      C.i.f. Destination (APR 1984)

    (a) The term c.i.f. destination, as used in this clause, means free 
of expense to the Government delivered on board the ocean vessel to the 
specified point of destination, with the cost of transportation and 
marine insurance paid by the Contractor.
    (b) The Contractor shall--
    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment for 
ocean transportation in conformance with carrier requirements;
    (2)(i) Deliver the shipment in good order and condition; and

[[Page 357]]

    (ii) Pay and bear all applicable charges to the point of destination 
specified in the contract, including transportation costs and export 
taxes or other fees or charges levied because of exportation;
    (3) Obtain and dispatch promptly to the Government clean on-board 
ocean bills of lading to the specified point of destination;
    (4) Be responsible for any loss of and/or damage to the goods 
occurring before delivery;
    (5) At the Government's request and expense, provide certificates of 
origin, consular invoices, or any other documents issued in the country 
of origin or of shipment, or both, that may be required for importation 
into the country of destination; and
    (6) Obtain and dispatch to the Government an insurance policy or 
certificate providing the amount and extent of marine insurance coverage 
specified in the contract or agreed upon by the Government Contracting 
Officer.

                             (End of clause)



Sec.  52.247-43  F.o.b. Designated Air Carrier's Terminal, Point of Exportation.

    As prescribed in 47.303-15(c), insert the following clause in 
solicitations and contracts when the delivery term is f.o.b. designated 
air carrier's terminal, point of exportation:

  F.o.b. Designated Air Carrier's Terminal, Point of Exportation (APR 
                                  1984)

    (a) The term f.o.b. designated air carrier's terminal, point of 
exportation, as used in this clause, means free of expense to the 
Government loaded aboard the aircraft, or delivered to the custody of 
the air carrier (if only the air carrier performs the loading), at the 
air carrier's terminal specified in the contract.
    (b) The Contractor shall--
    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment for air 
transportation in conformance with carrier requirements to protect the 
goods and to ensure assessment of the lowest applicable transportation 
charge;
    (2)(i) Deliver the shipment in good order and condition into the 
conveyance of the carrier, or to the custody of the carrier (if only the 
carrier performs the loading), at the point of delivery and on the date 
or within the period specified in the contract; and
    (ii) Pay and bear all applicable charges up to this point;
    (3) Provide a clean Government bill of lading and/or air waybill;
    (4) Be responsible for any loss of and/or damage to the goods 
occurring before delivery of the goods to the point specified in the 
contract; and
    (5) At the Government's request and expense, assist in obtaining the 
documents required for the purpose of exportation.

                             (End of clause)



Sec.  52.247-44  F.o.b. Designated Air Carrier's Terminal, Point of Importation.

    As prescribed in 47.303-16(c), insert the following clause in 
solicitations and contracts when the delivery term is f.o.b. designated 
air carrier's terminal, point of importation:

  F.o.b. Designated Air Carrier's Terminal, Point of Importation (APR 
                                  1984)

    (a) The term f.o.b. designated air carrier's terminal, point of 
importation, as used in this clause, means free of expense to the 
Government delivered to the air carrier's terminal at the point of 
importation specified in the contract.
    (b) The Contractor shall--
    (1)(i) Pack and mark the shipment to comply with contract 
specifications; or
    (ii) In the absence of specifications, prepare the shipment for air 
transportation in conformance with carrier requirements to protect the 
goods;
    (2) Prepare and distribute bills of lading or air waybills;
    (3)(i) Deliver the shipment in good order and condition to the point 
of delivery specified in the contract; and
    (ii) Pay and bear all charges incurred up to the point of delivery 
specified in the contract, including transportation costs; export, 
import, or other fees or taxes; cost of landing, if any; customs duties; 
and costs of certificates of origin, consular invoices, or other 
documents that may be required for exportation or importation; and
    (4) Be responsible for any loss of and/or damage to the goods until 
delivery of the goods to the Government at the designated air carrier's 
terminal.

                             (End of clause)



Sec.  52.247-45  F.o.b. Origin and/or F.o.b. Destination Evaluation.

    As prescribed in 47.305-2(b), insert the following provision in 
solicitations when offers are solicited on the basis of both f.o.b. 
origin and f.o.b. destination:

      F.o.b. Origin and/or f.o.b. Destination Evaluation (APR 1984)

    Offers are invited on the basis of both f.o.b. origin and f.o.b. 
destination, and the Government will award on the basis the Contracting

[[Page 358]]

Officer determines to be most advantageous to the Government. An offer 
on the basis of f.o.b. origin only or f.o.b. destination only is 
acceptable, but will be evaluated only on the basis submitted.

                           (End of provision)



Sec.  52.247-46  Shipping Point(s) Used in Evaluation of F.o.b. Origin Offers.

    As prescribed in 47.305-3(b)(4)(ii), insert the following provision 
in f.o.b. origin solicitations when price evaluation for shipments from 
various shipping points is contemplated:

 Shipping Point(s) Used in Evaluation of f.o.b. Origin Offers (APR 1984)

    (a) If more than one shipping point or plant is designated by the 
offeror and the offeror fails to indicate the quantity per shipping 
point or plant before bid opening, the Government will evaluate the 
offer on the basis of delivery of the entire quantity from the point or 
plant where cost of transportation is most favorable to the Government.
    (b) If the offeror, before bid opening (or the closing date 
specified for receipt of offers) fails to indicate any shipping point or 
plant, the Government will evaluate the offer on the basis of delivery 
from the plant at which the contract will be performed, as indicated in 
the offer. If no plant is indicated in the offer, the offer will be 
evaluated on the basis of delivery from the Contractor's business 
address indicated in the offer.
    (c) If the offeror uses a shipping point other than that which has 
been used by the Government as a basis for the evaluation of offers, any 
increase of transportation costs shall be borne by the Contractor and 
any savings shall revert to the Government.

                           (End of provision)



Sec.  52.247-47  Evaluation--F.o.b. Origin.

    As prescribed in 47.305-3(f)(2), insert the following provision. 
When it is appropriate to use methods other than land transportation in 
evaluating offers; e.g., air, pipeline, barge, or ocean tanker, modify 
the provision accordingly.

                  Evaluation--F.o.b. Origin (June 2003)

    (a) The Government normally uses land methods of transportation by 
regulated common carrier for shipment within the contiguous United 
States.
    (b) To evaluate offers, the Government will consider only these 
methods to establish the cost of transportation between offeror's 
shipping point and destination (tentative or firm, whichever is 
applicable) in the contiguous United States.
    (c) This transportation cost will be added to the offer price to 
determine the Government's overall cost.
    (d) When tentative destinations are indicated, the Government will 
use them only for evaluation purposes. The Government has the right to 
use any other means of transportation or any other destination at the 
time of shipment.

                           (End of provision)

[68 FR 28088, May 22, 2003]



Sec.  52.247-48  F.o.b. Destination--Evidence of Shipment.

    As prescribed in 47.305-4(c), insert the following clause:

           F.o.b. Destination--Evidence of Shipment (FEB 1999)

    (a) If this contract is awarded on a free on board (f.o.b.) 
destination basis, the Contractor--
    (1) Shall not submit an invoice for payment until the supplies 
covered by the invoice have been shipped to the destination; and
    (2) Shall retain, and make available to the Government for review as 
necessary, the following evidence of shipment documentation for a period 
of 3 years after final payment under the contract:
    (i) If transportation is accomplished by common carrier, a signed 
copy of the commercial bill of lading for the supplies covered by the 
Contractor's invoice, indicating the carrier's intent to ship the 
supplies to the destination specified in the contract.
    (ii) If transportation is accomplished by parcel post, a copy of the 
certificate of mailing.
    (iii) If transportation is accomplished by other than common carrier 
or parcel post, a copy of the delivery document showing receipt at the 
destination specified in the contract.
    (b) The Contractor is not required to submit evidence of shipment 
documentation with its invoice.

                             (End of clause)

[63 FR 70292, Dec. 18, 1998]



Sec.  52.247-49  Destination Unknown.

    As prescribed in 47.305-5(b)(2), insert the following provision in 
solicitations when destinations are tentative and only for the purpose 
of evaluating offers:

[[Page 359]]

                     Destination Unknown (APR 1984)

For the purpose of evaluating offers and for no other purpose, the final 
destination(s) for the supplies will be considered to be as follows:____

                           (End of provision)



Sec.  52.247-50  No Evaluation of Transportation Costs.

    As prescribed in 47.305-5(c)(1), insert the following provision in 
solicitations when exact destinations are not known and it is 
impractical to establish tentative or general delivery places for the 
purpose of evaluating transportation costs:

            No Evaluation of Transportation Costs (APR 1984)

    Costs of transporting supplies to be delivered under this contract 
will not be an evaluation factor for award.

                           (End of provision)



Sec.  52.247-51  Evaluation of Export Offers.

    As prescribed in 47.305-6(e), insert the following provision:

                 Evaluation of Export Offers (JAN 2001)

    (a) Port handling and ocean charges--other than DOD water terminals. 
Port handling and ocean charges in tariffs on file with the Bureau of 
Domestic Regulation, Federal Maritime Commission, or other appropriate 
regulatory authorities as of the date of bid opening (or the closing 
date specified for receipt of offers) and which will be effective for 
the date of the expected initial shipment will be used in the evaluation 
of offers.
    (b) F.o.b. origin, transportation under Government bill of lading. 
(1) Offers shall be evaluated and awards made on the basis of the lowest 
laid down cost to the Government at the overseas port of discharge, via 
methods and ports compatible with required delivery dates and conditions 
affecting transportation known at the time of evaluation. Included in 
this evaluation, in addition to the f.o.b. origin price of the item, 
shall be the inland transportation costs from the point of origin in the 
United States to the port of loading, port handling charges at the port 
of loading, and ocean shipping costs from the United States port of 
loading (see paragraph (d) below) to the overseas port of discharge. The 
Government may designate the mode of routing of shipment and may load 
from other than those ports specified for evaluation purposes.
    (2) Offers shall be evaluated on the basis of shipment through one 
of the ports set forth in paragraph (d) below to the overseas port of 
discharge. Evaluation shall be made on the basis of shipment through the 
port that will result in the lowest cost to the Government.
    (3) Ports of loading shall be considered as destinations within the 
meaning of the term f.o.b. destination as that term is used in the 
F.o.b. Origin clause of this contract.
    (c) F.o.b. port of loading with inspection and acceptance at origin. 
(1) Offers shall be evaluated on the basis of the lowest laid down cost 
to the Government at the overseas port of discharge via methods 
compatible with required delivery dates and conditions affecting 
transportation known at the time of evaluation. Included in this 
evaluation, in addition to the price to the United States port of 
loading (see paragraph (2) below), shall be the port handling charges at 
the port of loading and the ocean shipping cost from the port of loading 
(see paragraph (d) below) to the overseas port of discharge.
    (2) Unless offers are applicable only to f.o.b. origin delivery 
under Government bills of lading (see paragraph (b) above), offerors 
shall designate below at least one of the ports of loading listed in 
paragraph (d) below as their place of delivery. Failure to designate at 
least one of the ports as the point to which delivery will be made by 
the Contractor may render the offer nonresponsive.
PLACE OF DELIVERY:______________________________________________________
[Offerors insert at least one of the ports listed in paragraph (d) 
below.]

    (d) Ports of loading for evaluation of offers. Terminals to be used 
by the Government in evaluating offers are as follows: (For the 
information of the offerors, ocean and port handling charges are set 
forth if the terminal named is a DOD water terminal.)

 
                                                  Unit of Measure: i.e.,
   Ports/Terminals of    Combined Ocean and Port        metric ton,
        Loading            Handling Charges to    measurement ton, cubic
                            (Indicate Country)          foot, etc.
 
--------------           --------------           --------------
--------------           --------------           --------------
--------------           --------------           --------------
 

    (e) Ports of loading nominated by offeror. The ports of loading 
named in paragraph (d) above are considered by the Government to be 
appropriate for this solicitation due to their compatibility with 
methods and facilities required to handle the cargo and types of vessels 
and to meet the required overseas delivery dates. Notwithstanding the 
foregoing, offerors may nominate additional ports of loading that the 
offeror considers to be more favorable to the Government. The Government 
may disregard such nominated ports if, after considering the quantity 
and nature of the supplies concerned, the requisite cargo handling 
capability, the available sailings on U.S.-flag vessels, and other 
pertinent transportation factors, it determines that use of the 
nominated ports is not

[[Page 360]]

compatible with the required overseas delivery date. United States Great 
Lakes ports of loading may be considered in the evaluation of offers 
only for those items scheduled in this provision for delivery during the 
ice-free or navigable period as proclaimed by the authorities of the St. 
Lawrence Seaway (normal period is between April 15 and November 30 
annually). All ports named, including those nominated by offerors and 
determined to be eligible as provided in this provision, shall be 
considered in evaluating all offers received in order to establish the 
lowest laid down cost to the Government at the overseas port of 
discharge. All determinations shall be based on availability of ocean 
services by U.S.-flag vessels only. Additional U.S. port(s) of loading 
nominated by offeror, if any: ------
    (f) Price basis: Offeror shall indicate whether prices are based 
on--
    ( ) Paragraph (b), f.o.b. origin, transportation by GBL to port 
listed in paragraph (d);
    ( ) Paragraph (c), f.o.b. destination (i.e., a port listed in 
paragraph (d));
    ( ) Paragraph (e), f.o.b. origin, transportation by GBL to port 
nominated in paragraph (e); and/or
    ( ) Paragraph (e), f.o.b. destination (i.e., a port nominated in 
paragraph (e)).

                           (End of provision)

    Alternate I (FEB 1995). When the CONUS ports of export are DOD water 
terminals, delete paragraph (a) from the basic provision and substitute 
for it the following paragraph (a):

    (a) Port handling and ocean charges--DOD water terminals. The port 
handling and ocean charges are set forth in paragraph (d) of this 
provision for the information of offerors and are current as of the time 
of issuance of the solicitation. For evaluation of offers, the 
Government will use the port handling and ocean charges made available 
by the Directorate of International Traffic, Military Traffic Management 
Command rate information letters, on file as of the date of bid opening 
(or the closing date specified for receipt of offers) and which will be 
effective for the date of the expected initial shipment.

    Alternate II (APR 1984). When offers are solicited on an f.o.b. 
origin only basis, delete paragraphs (c) and (f) from the basic 
provision, but do not redesignate the ensuing paragraphs. Add the 
following basic paragraph (g) to the provision:

    (g) Paragraphs (c) and (f) have been deleted but ensuing paragraphs 
have not been redesignated.

    Alternate III (APR 1984). When offers are solicited on an f.o.b. 
destination only basis, delete paragraph (b) from the basic provision 
but do not redesignate the ensuing paragraphs. Delete subparagraph 
(c)(2) and paragraph (f) from the provision and substitute the following 
subparagraph (c)(2) and paragraph (f). Add paragraph (g) below.

    (c)(2) Offerors shall designate below at least one of the ports of 
loading listed in paragraph (d) below as their place of delivery. 
Failure to designate at least one of the ports as the point to which 
delivery will be made by the Contractor may render the offer 
nonresponsive.
PLACE OF DELIVERY:______________________________________________________
[Offerors insert at least one of the ports listed in paragraph (d) 
below.].
    (f) Price basis. Offerors shall indicate whether prices are based 
on--
    [squ] Paragraph (c), f.o.b. destination (i.e., a port listed in 
paragraph (d)); or
    [squ] Paragraph (e), f.o.b. destination (i.e., a port nominated in 
paragraph (e)).
    (g) Paragraph (b) has been deleted, but ensuing paragraphs have not 
been redesignated.

[48 FR 42478, Sept. 19, 1983, as amended at 59 FR 67058, Dec. 28, 1994; 
66 FR 2141, Jan. 10, 2001]



Sec.  52.247-52  Clearance and Documentation Requirements--Shipments to DOD 
Air or Water Terminal Transshipment Points.

    As prescribed in 47.305-6(f)(2), insert the following clause in 
solicitations and contracts when shipments will be consigned to DOD air 
or water terminal transshipment points:

Clearance and Documentation Requirements--Shipments to DOD Air or Water 
                Terminal Transshipment Points (APR 1984)

    All shipments to water or air ports for transshipment to overseas 
destinations are subject to the following requirements unless clearance 
and documentation requirements have been expressly delegated to the 
Contractor:
    (a) At least 10 days before shipping cargo to a water port, the 
Contractor shall obtain an Export Release from the Government 
transportation office for--
    (1) Each shipment weighing 10,000 pounds or more; and
    (2) Each shipment weighing less than 10,000 pounds; if the cargo 
either--
    (i) Is classified TOP SECRET, SECRET, OR CONFIDENTIAL;

[[Page 361]]

    (ii) Will require exclusive use of a motor vehicle;
    (iii) Will occupy full visible capacity of a railway car or motor 
vehicle;
    (iv) Is less than a carload or truckload, but will be tendered as a 
carload or truckload; or
    (v) Is to be shipped to an ammunition outloading port for water 
shipment; or
    (3) Each shipment weighing less than 10,000 pounds if the cargo 
consists of--
    (i) Narcotics;
    (ii) Perishable biological material;
    (iii) Vehicles to be offered for driveaway service;
    (iv) Explosives, or other dangerous articles classified as A, B, or 
C explosives;
    (v) Poisons, classes A, B, or C; or
    (vi) Radioactive material, as defined in 49 CFR 170-179.
    (b) The Contractor is cautioned not to order railway cars or motor 
vehicles for loading until an Export Release has been received.
    (c) If the Contracting Officer directs delivery within a shorter 
period than 10 days, the Contractor shall advise the transportation 
office of the date on which the cargo will be ready for shipment.
    (d) At least 5 days before shipping cargo to either a water port or 
an air port (regardless of the weight, security classification, or the 
commodity description), the Contractor shall provide the Government 
transportation office the information shown in paragraph (e) below to 
permit preparation of a Transportation Control and Movement Document 
(TCMD).
    (e) When applying for the Export Release in paragraph (a) above or 
when providing information for preparation of the TCMD in accordance 
with paragraph (d) above, the Contractor shall furnish the--
    (1) Proposed date or dates of shipment;
    (2) Number and type of containers;
    (3) Gross weight and cube of the shipment;
    (4) Number of cars or trucks that will be involved;
    (5) Transportation Control Number(s) (TCN) as required for marking 
under MIL-STD-129 or Federal Standard 123; and
    (6) Proper shipping name as specified in 46 CFR 146.05 for all items 
classified as dangerous substances as required for marking under MIL-
STD-129.
    (f) All movement documents (Government or commercial bills of lading 
or other delivery documents) shall be annotated by the Contractor with 
the--
    (1) Transportation Control Number, Consignor Code of activity 
directing the shipment; i.e., cognizant contract administration office, 
purchasing office when contract administration has been retained, or a 
Contractor specifically delegated MILSTAMP responsibilities in the 
contract, whichever is appropriate, Consignee Code, and Transportation 
Priority for each shipment unit;
    (2) Export Release Number and valid shipping period, if stated (if 
expired, the Contractor shall request a renewal); and
    (3) Cubic foot measurement of each shipment unit.
    (g) All annotations on the movement documents shall be made in the 
Description of Articles space except, on Government bills of lading the 
Export Release number and shipping period shall be entered in the space 
entitled Route Order/Release No.
    (h) The Contractor shall (1) mail a copy of the commercial bill of 
lading or other movement document to the transshipment point and (2) 
give a copy of the commercial bill of lading or other movement document 
to the carrier for presentation to the transshipment point with delivery 
of the shipment.

                             (End of clause)



Sec.  52.247-53  Freight Classification Description.

    As prescribed in 47.305-9(b)(1), insert the following provision in 
solicitations when the supplies being acquired are new to the supply 
system, nonstandard, or modifications of previously shipped items, and 
different freight classifications may apply:

              Freight Classification Description (APR 1984)

    Offerors are requested to indicate below the full Uniform Freight 
Classification (rail) description, or the National Motor Freight 
Classification description applicable to the supplies, the same as 
offeror uses for commercial shipment. This description should include 
the packing of the commodity (box, crate, bundle, loose, setup, knocked 
down, compressed, unwrapped, etc.), the container material (fiberboard, 
wooden, etc.), unusual shipping dimensions, and other conditions 
affecting traffic descriptions. The Government will use these 
descriptions as well as other information available to determine the 
classification description most appropriate and advantageous to the 
Government. Offeror understands that shipments on any f.o.b. origin 
contract awarded, as a result of this solicitation, will be made in 
conformity with the shipping classification description specified by the 
Government, which may be different from the classification description 
furnished below.
FOR FREIGHT CLASSIFICATION PURPOSES, OFFEROR DESCRIBES THIS COMMODITY AS

[[Page 362]]

                           (End of provision)



Sec.  52.247-54  [Reserved]



Sec.  52.247-55  F.o.b. Point for Delivery of Government-Furnished Property.

    As prescribed in 47.305-12(a)(2), insert the following clause:

 F.o.b. Point for Delivery of Government-Furnished Property (June 2003)

    (a) Unless otherwise specified in this solicitation, the Government 
will deliver any Government-furnished property for use within the 
contiguous United States or Canada to a point specified by the 
Contractor in the offer. If the Government makes delivery by railroad, 
the f.o.b. point will be private siding, Contractor's plant. If the 
Contractor's plant is not served by rail, the f.o.b. point will be 
railroad cars in the same or nearest city having rail service. The 
Government may choose the mode of transportation and the carriers and 
will bear the cost of all line-haul transportation to the specified 
destination.
    (b) If the destination of the Government-furnished property is a 
Contractor's plant located outside the contiguous United States or 
Canada, the f.o.b. point for Government delivery of Government-furnished 
property will be a Contractor-specified location in the contiguous 
United States. If the Contractor fails to name a point, the Government 
will select as the f.o.b. point the port city in the contiguous United 
States nearest to the Government-furnished property that has regular 
commercial water transportation services to the offshore port nearest 
the Contractor's plant.
    (c) Unless otherwise directed by the Contracting Officer or provided 
in the contract, the Contractor shall return all Government-furnished 
equipment, supplies, and property, including all property not returned 
in the form of acceptable end items, to the point at which the 
Government property was originally furnished to the Contractor under the 
contract. Notwithstanding the fact that the Government may have 
furnished the property at the Contractor's plant, the Contracting 
Officer may direct the Contractor to deliver the Government property 
being returned to, and load, block, and brace it in, railway cars in the 
city in which the Contractor's plant is located, or, if the Contractor's 
city is not served by rail service, in the nearest city having rail 
service. Unless otherwise specified in the contract, all property shall 
be packed in containers conforming with the rules of common carrier 
published tariffs so as to be free of penalty charges by the carrier 
designated for shipment by the Government.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 68 FR 28088, May 22, 2003]



Sec.  52.247-56  Transit Arrangements.

    As prescribed in 47.305-13(a)(3)(ii), insert the following provision 
in solicitations when benefits may accrue to the Government because 
transit arrangements may apply:

                     Transit Arrangements (APR 1984)

    The lowest appropriate common carrier transportation costs, 
including offeror's through transit rates and charges when applicable, 
from offeror's shipping points, via the transit point, to the ultimate 
destination will be used in evaluating offers.

 
           Transit point(s)                 Destination(s)
 
 
------------------------------------------------------------------------
 
------------------------------------------------------------------------
 
------------------------------------------------------------------------
 

                           (End of provision)



Sec.  52.247-57  Transportation Transit Privilege Credits.

    As prescribed in 47.305-13(b)(4), insert the following clause in 
solicitations and contracts when supplies are of such a nature, or when 
it is the custom of the trade, that offerors may have potential transit 
credits available and the Government may reduce transportation costs 
through the use of transit credits:

           Transportation Transit Privilege Credits (APR 1984)

    (a) If the offeror has established with regulated common carriers 
transit privileges that can be applied to the supplies when shipped from 
the original source, the offeror is invited to propose to use these 
credits for shipping the supplies to the designated Government 
destinations. The offeror will ship these supplies under commercial 
bills of lading, paying all remaining transportation charges connected 
with the shipment, subject to reimbursement by the Government in an 
amount equal to the remaining charges but not exceeding the amount 
quoted by the offeror.
    (b) After loading on the carrier's equipment and acceptance by the 
carrier, these shipments under paid commercial bills of lading will move 
for the account of and at the risk of the Government (unless, pursuant

[[Page 363]]

to the Changes clause, the office administering the contract directs use 
of Government bills of lading).
    (c) The amount quoted below by the offeror represents the 
transportation costs in cents per 100 pounds (freight rate) for full 
carload/truckload shipments of the supplies from offeror's original 
source, via offeror's transit plant or point, to the Government 
destination(s) including the carrier's transit privilege charge, less 
the applicable transit credit (i.e., the amount (rate) initially paid to 
the carrier for shipment from original source to offeror's transit plant 
or point).
    (d) The rate per CWT quoted will be used by the Government to 
evaluate the offered f.o.b. origin price unless a lower rate is 
applicable on the date of bid opening (or closing date specified for 
receipt of offers). To have the offer evaluated on this basis, the 
offeror must insert below the remaining transportation charges that the 
offeror agrees to pay, including any transit charges, subject to 
reimbursement by the Government, as explained in this clause, to 
destinations listed in the Schedule as follows:
RATE PER CWT IN CENTS___________________________________________________
TO DESTINATION__________________________________________________________

                             (End of clause)



Sec.  52.247-58  Loading, Blocking, and Bracing of Freight Car Shipments.

    As prescribed in 47.305-15(a)(2), insert the following clause in 
solicitations and contracts when supplies may be shipped in carload lots 
by rail:

   Loading, Blocking, and Bracing of Freight Car Shipments (APR 1984)

    (a) Upon receipt of shipping instructions, as provided in this 
contract, the supplies to be included in any carload shipment by rail 
shall be loaded, blocked, and braced by the Contractor in accordance 
with the standards published by the Association of American Railroads 
and effective at the time of shipment.
    (b) Shipments, for which the Association of American Railroads has 
published no such standards, shall be loaded, blocked, and braced in 
accordance with standards established by the shipper as evidenced by 
written acceptance of an authorized representative of the carrier.
    (c) The Contractor shall be liable for payment of any damage to any 
supplies caused by the failure to load, block, and brace in accordance 
with acceptable standards set forth herein.
    (d) A copy of the appropriate pamphlet of the Association of 
American Railroads may be obtained from that Association.

                             (End of clause)



Sec.  52.247-59  F.o.b. Origin--Carload and Truckload Shipments.

    As prescribed in 47.305-16(a), insert the following clause in 
solicitations and contracts when it is contemplated that they may result 
in f.o.b. origin contracts with shipments in carloads or truckloads. 
This will facilitate realistic freight cost evaluations of offers and 
ensure that contractors produce economical shipments of agreed size.

        F.o.b. Origin--Carload and Truckload Shipments (APR 1984)

    (a) The Contractor agrees that shipment shall be made in carload or 
truckload lots when the quantity to be delivered to any one destination 
in any delivery period pursuant to the contract schedule of deliveries 
is sufficient to constitute a carload r truckload shipment, except as 
may otherwise be permitted or directed, in writing, by the Contracting 
Officer.
    (b) For evaluation purposes, the agreed weight of a carload or 
truckload shall be the highest applicable minimum weight that will 
result in the lowest freight rate (or per car charge) on file or 
published in common carrier tariffs or tenders as of the date of bid 
opening (or the closing date specified for receipt of proposals).
    (c) For purposes of actual delivery, the agreed weight of a carload 
or truckload will be the highest applicable minimum weight that will 
result in the lowest possible freight rate (or per car charge) on file 
or published as of date of shipment.
    (d) If the total weight of any scheduled quantity to a destination 
is less than the highest carload/truckload minimum weight used for 
evaluation of offers, the Contractor agrees to ship such scheduled 
quantity in one shipment.
    (e) The Contractor shall be liable to the Government for any 
increased costs to the Government resulting from failure to comply with 
the above requirements.

                             (End of clause)



Sec.  52.247-60  Guaranteed Shipping Characteristics.

    As prescribed in 47.305-16(b)(1), insert the following clause:

             Guaranteed Shipping Characteristics (DEC 1989)

    (a) The offeror is requested to complete subparagraph (a)(1) of this 
clause, for each part or component which is packed or packaged 
separately. This information will be used to determine transportation 
costs for

[[Page 364]]

evaluation purposes. If the offeror does not furnish sufficient data in 
subparagraph (a)(1) of this clause, to permit determination by the 
Government of the item shipping costs, evaluation will be based on the 
shipping characteristics submitted by the offeror whose offer produces 
the highest transportation costs or in the absence thereof, by the 
Contracting Officer's best estimate of the actual transportation costs. 
If the item shipping costs, based on the actual shipping 
characteristics, exceed the item shipping costs used for evaluation 
purposes, the Contractor agrees that the contract price shall be reduced 
by an amount equal to the difference between the transportation costs 
actually incurred, and the costs which would have been incurred if the 
evaluated shipping characteristics had been accurate.
    (1) To be completed by the offeror:
    (i) Type of container: Wood Box ----, Fiber Box ----, Barrel ----, 
Reel ----, Drum ----, Other (Specify) ----;
    (ii) Shipping configuration: Knocked-[chyph]down----, Set-up ----, 
Nested ----, Other (specify) ----;
    (iii) Size of container ----[dprime] (Length), x ----[dprime] 
(Width), x ----[dprime] (Height) = ---- Cubic FT;
    (iv) Number of items per container ---- Each;
    (v) Gross weight of container and contents---- LBS
    (vi) Palletized/skidded ---- Yes ---- No;
    (vii) Number of containers per pallet/[chyph]skid----;
    (viii) Weight of empty pallet bottom/skid and sides---- LBS;
    (ix) Size of pallet/skid and contents ---- LBS Cube ----;
    (x) Number of containers or pallets/skid per railcar ----*--
---------------------------------------------------------------------------

    *Number of complete units (contract line item) to be shipped in 
carrier's equipment.
---------------------------------------------------------------------------

    Size of railcar ----
    Type of railcar ----
    (xi) Number of containers or pallets/skids per trailer ----*--
    Size of trailer ---- FT
    Type of trailer ----
    (2) To be completed by the Government after evaluation but before 
contract award:
    (i) Rate used in evaluation ----;
    (ii) Tender/Tariff ----;
    (iii) Item ----;
    (b) The guaranteed shipping characteristics requested in 
subparagraph (a)(1) of this clause do not establish actual 
transportation requirements, which are specified elsewhere in this 
solicitation. The guaranteed shipping characteristics will be used only 
for the purpose of evaluating offers and establishing any liability of 
the successful offeror for increased transportation costs resulting from 
actual shipping characteristics which differ from those used for 
evaluation in accordance with paragraph (a) of this clause.

                             (End of clause)

[54 FR 48997, Nov. 28, 1989; 55 FR 30, Jan. 2, 1990]



Sec.  52.247-61  F.o.b. Origin--Minimum Size of Shipments.

    As prescribed in 47.305-16(c), insert the following clause in 
solicitations and contracts when volume rates may apply:

           F.o.b. Origin--Minimum Size of Shipments (APR 1984)

    The Contractor agrees that shipment will be made in carload and 
truckload lots when the quantity to be delivered to any one destination 
in any delivery period pursuant to the contract schedule of deliveries 
is sufficient to constitute a carload or truckload shipment, except as 
may otherwise be permitted or directed in writing by the Contracting 
Officer. The agreed weight of a carload or truckload will be the highest 
applicable minimum weight which will result in the lowest freight rate 
(or per car charge) on file or published in common carrier tariffs or 
tenders as of date of shipment. In the event the total weight of any 
scheduled quantity to a destination is less than the highest carload/
truckload minimum weight, the Contractor agrees to ship such scheduled 
quantity in one shipment. The Contractor shall be liable to the 
Government for any increased costs to the Government resulting from 
failure to comply with the above requirements. This liability shall not 
attach if supplies are outsized or of such nature that they cannot be 
loaded at the highest minimum weight bracket.

                             (End of clause)



Sec.  52.247-62  Specific Quantities Unknown.

    As prescribed in 47.305-16(d)(2), insert the following clause in 
solicitations and contracts when total requirements and destinations to 
which shipments will be made are known, but the specific quantity to be 
shipped to each destination cannot be predetermined. This clause 
protects the interests of both the Government and the contractor during 
the course of the performance of the contract.

                 Specific Quantities Unknown (APR 1984)

    (a) For the purpose of evaluating f.o.b. destination offers, the 
Government estimates that the quantity specified will be shipped to the 
destinations indicated:

[[Page 365]]



 
          Estimated quantity                 Destination
 
 
------------------------------------------------------------------------
 
------------------------------------------------------------------------
 
------------------------------------------------------------------------
 

    (b) If the quantity shipped to each destination varies from the 
quantity estimated, and if the variation results in a change in the 
transportation costs, appropriate adjustment shall be made.

                             (End of clause)



Sec.  52.247-63  Preference for U.S.-Flag Air Carriers.

    As prescribed in 47.405, insert the following clause:

            Preference for U.S.-Flag Air Carriers (June 2003)

    (a) Definitions. As used in this clause--
    International air transportation means transportation by air between 
a place in the United States and a place outside the United States or 
between two places both of which are outside the United States.
    United States means the 50 States, the District of Columbia, and 
outlying areas.
    U.S.-flag air carrier means an air carrier holding a certificate 
under 49 U.S.C. Chapter 411.
    (b) Section 5 of the International Air Transportation Fair 
Competitive Practices Act of 1974 (49 U.S.C. 40118) (Fly America Act) 
requires that all Federal agencies and Government contractors and 
subcontractors use U.S.-flag air carriers for U.S. Government-financed 
international air transportation of personnel (and their personal 
effects) or property, to the extent that service by those carriers is 
available. It requires the Comptroller General of the United States, in 
the absence of satisfactory proof of the necessity for foreign-flag air 
transportation, to disallow expenditures from funds, appropriated or 
otherwise established for the account of the United States, for 
international air transportation secured aboard a foreign-flag air 
carrier if a U.S.-flag air carrier is available to provide such 
services.
    (c) If available, the Contractor, in performing work under this 
contract, shall use U.S.-flag carriers for international air 
transportation of personnel (and their personal effects) or property.
    (d) In the event that the Contractor selects a carrier other than a 
U.S.-flag air carrier for international air transportation, the 
Contractor shall include a statement on vouchers involving such 
transportation essentially as follows:

          Statement of Unavailability of U.S.-Flag Air Carriers

    International air transportation of persons (and their personal 
effects) or property by U.S.-flag air carrier was not available or it 
was necessary to use foreign-flag air carrier service for the following 
reasons (see section 47.403 of the Federal Acquisition Regulation): 
[State reasons]:
________________________________________________________________________

                           (End of statement)

    (e) The Contractor shall include the substance of this clause, 
including this paragraph (e), in each subcontract or purchase under this 
contract that may involve international air transportation.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 53 FR 27468, July 20, 1988; 
62 FR 240, Jan. 2, 1997; 68 FR 28088, May 22, 2003]



Sec.  52.247-64  Preference for Privately Owned U.S.-Flag Commercial Vessels.

    As prescribed in 47.507(a), insert the following clause:

 Preference for Privately Owned U.S.-Flag Commercial Vessels (Apr 2003)

    (a) Except as provided in paragraph (e) of this clause, the Cargo 
Preference Act of 1954 (46 U.S.C. Appx. 1241(b)) requires that Federal 
departments and agencies shall transport in privately owned U.S.-flag 
commercial vessels at least 50 percent of the gross tonnage of 
equipment, materials, or commodities that may be transported in ocean 
vessels (computed separately for dry bulk carriers, dry cargo liners, 
and tankers). Such transportation shall be accomplished when any 
equipment, materials, or commodities, located within or outside the 
United States, that may be transported by ocean vessel are--
    (1) Acquired for a U.S. Government agency account;
    (2) Furnished to, or for the account of, any foreign nation without 
provision for reimbursement;
    (3) Furnished for the account of a foreign nation in connection with 
which the United States advances funds or credits, or guarantees the 
convertibility of foreign currencies; or
    (4) Acquired with advance of funds, loans, or guaranties made by or 
on behalf of the United States.
    (b) The Contractor shall use privately owned U.S.-flag commercial 
vessels to ship at least 50 percent of the gross tonnage involved under 
this contract (computed separately for dry bulk carriers, dry cargo 
liners,

[[Page 366]]

and tankers) whenever shipping any equipment, materials, or commodities 
under the conditions set forth in paragraph (a) above, to the extent 
that such vessels are available at rates that are fair and reasonable 
for privately owned U.S.-flag commercial vessels.
    (c)(1) The Contractor shall submit one legible copy of a rated on-
board ocean bill of lading for each shipment to both (i) the Contracting 
Officer and (ii) the Office of Cargo Preference, Maritime Administration 
(MAR-590), 400 Seventh Street, SW, Washington, DC 20590. Subcontractor 
bills of lading shall be submitted through the Prime Contractor.
    (2) The Contractor shall furnish these bill of lading copies (i) 
within 20 working days of the date of loading for shipments originating 
in the United States, or (ii) within 30 working days for shipments 
originating outside the United States. Each bill of lading copy shall 
contain the following information:
    (A) Sponsoring U.S. Government agency.
    (B) Name of vessel.
    (C) Vessel flag of registry.
    (D) Date of loading.
    (E) Port of loading.
    (F) Port of final discharge.
    (G) Description of commodity.
    (H) Gross weight in pounds and cubic feet if available.
    (I) Total ocean freight revenue in U.S. dollars.
    (d) The Contractor shall insert the substance of this clause, 
including this paragraph (d), in all subcontracts or purchase orders 
under this contract, except those described in paragraph (e)(4).
    (e) The requirement in paragraph (a) does not apply to--
    (1) Cargoes carried in vessels of the Panama Canal Commission or as 
required or authorized by law or treaty;
    (2) Ocean transportation between foreign countries of supplies 
purchased with foreign currencies made available, or derived from funds 
that are made available, under the Foreign Assistance Act of 1961 (22 
U.S.C. 2353);
    (3) Shipments of classified supplies when the classification 
prohibits the use of non-Government vessels; and
    (4) Subcontracts or purchase orders for the acquisition of 
commercial items unless--
    (i) This contract is--
    (A) A contract or agreement for ocean transportation services; or
    (B) A construction contract; or
    (ii) The supplies being transported are--
    (A) Items the Contractor is reselling or distributing to the 
Government without adding value. (Generally, the Contractor does not add 
value to the items when it subcontracts items for f.o.b. destination 
shipment); or
    (B) Shipped in direct support of U.S. military--
    (1) Contingency operations;
    (2) Exercises; or
    (3) Forces deployed in connection with United Nations or
    North Atlantic Treaty Organization humanitarian or peacekeeping 
operations.
    (f) Guidance regarding fair and reasonable rates for privately owned 
U.S.-flag commercial vessels may be btained from the Office of Costs and 
Rates, Maritime Administration, 400 Seventh Street, SW, Washington, DC 
20590, Phone: 202-366-4610.

                             (End of clause)

    Alternate I (Apr 2003). As prescribed in 47.507(a)(2), substitute 
the following paragraphs (a) and (b) for paragraphs (a) and (b) of the 
basic clause:

    (a) Except as provided in paragraphs (b) and (e) of this clause, the 
Contractor shall use privately owned U.S.-flag commercial vessels, and 
no others, in the ocean transportation of any supplies to be furnished 
under this contract.
    (b) If such vessels are not available for timely shipment at rates 
that are fair and reasonable for privately owned U.S.-flag commercial 
vessels, the Contractor shall notify the Contracting Officer and request 
(1) authorization to ship in foreign-flag vessels or (2) designation of 
available U.S.-flag vessels. If the Contractor is authorized in writing 
by the Contracting Officer to ship the supplies in foreign-flag vessels, 
the contract price shall be equitably adjusted to reflect the difference 
in costs of shipping the supplies in privately owned U.S.-flag 
commercial vessels and in foreign-flag vessels.

    Alternate II (Apr 2003). As prescribed in 47.507(a)(3), substitute 
the following paragraph (e) for paragraph (e) of the basic clause:

    (e) The requirement in paragraph (a) does not apply to--
    (1) Cargoes carried in vessels of the Panama Canal
    Commission or as required or authorized by law or treaty;
    (2) Ocean transportation between foreign countries of supplies 
purchased with foreign currencies made available, or derived from funds 
that are made available, under the Foreign Assistance Act of 1961 (22 
U.S.C. 2353); and
    (3) Shipments of classified supplies when the classification 
prohibits the use of non-Government vessels.
    (4) Subcontracts or purchase orders under this contract for the 
acquisition of commercial items unless the supplies being transported 
are--
    (i) Items the Contractor is reselling or distributing to the 
Government without adding value. (Generally, the Contractor does not

[[Page 367]]

add value to the items when it subcontracts items for f.o.b. destination 
shipment); or
    (ii) Shipments in direct support of U.S. military--
    (A) Contingency operations;
    (B) Exercises; or
    (C) Forces deployed in connection with United Nations or North 
Atlantic Treaty Organization humanitarian or peacekeeping operations. 
(Note: This contract requires shipment of commercial items in direct 
support of U.S. military contingency operations, exercises, or forces 
deployed in connection with United Nations or North Atlantic Treaty 
Organization humanitarian or peacekeeping operations.)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34762, July 3, 1995; 
61 FR 39198, July 26, 1996; 62 FR 40238, July 25, 1997; 62 FR 51379, 
Oct. 1, 1997; 65 FR 24324, Apr. 25, 2000; 68 FR 13204, Mar. 18, 2003; 68 
FR 28098, May 22, 2003]



Sec.  52.247-65  F.o.b. Origin, Prepaid Freight--Small Package Shipments.

    As prescribed in 47.303-17(f), insert the following clause:

    F.o.b. Origin Prepaid Freight--Small Package Shipments (JAN 1991)

    (a) When authorized by the Contracting Officer, f.o.b. origin 
freight shipments which do not have a security classification shall move 
on prepaid commercial bills of lading or other shipping documents to 
domestic destinations, including air and water terminals. Weight of 
individual shipments shall be governed by carrier restrictions but shall 
not exceed 150 pounds by any form of commercial air or 1,000 pounds by 
other commercial carriers. The Government will reimburse the Contractor 
for reasonable freight charges.
    (b) The Contractor shall annotate the commercial bill of lading as 
required by the clause of this contract entitled ``Commercial Bill of 
Lading Notations.''
    (c) The Contractor shall consolidate prepaid shipments in accordance 
with procedures established by the cognizant transportation office. The 
Contractor is authored to combine Government prepaid shipments with the 
Contractor's commercial shipments for delivery to one or more consignees 
and the Government will reimburse its pro rata share of the total 
freight costs. The Contractor shall provide a copy of the commercial 
bill of lading promptly to each consignee. Quantities shall not be 
divided into mailable lots for the purpose of avoiding movement by other 
modes of transportation.
    (d) Transportation charges will be billed as a separate item on the 
invoice for each shipment made. A copy of the pertinent bill of lading, 
shipment receipt, or freight bill shall accompany the invoice unless 
otherwise specified in the contract.
    (e) Loss and damage claims will be processed by the Government.

                             (End of clause)

[55 FR 52800, Dec. 21, 1990]



Sec.  52.247-66  Returnable Cylinders.

    As prescribed in 47.305-17, insert the following clause:

                     Returnable Cylinders (MAY 1994)

    (a) Cylinder, referred to in this clause, is a pressure vessel 
designed for pressures higher than 40 psia and having a circular cross 
section excluding a portable tank, multitank car tank, cargo tank or 
tank car.
    (b) Returnable cylinders shall remain the Contractor's property but 
shall be loaned without charge to the Government for a period of ---- 
days [Contracting Officer shall insert number of days] (hereafter 
referred to as loan period) following the day of delivery to the f.o.b. 
point specified in the contract. Any cylinder not returned within the 
loan period shall be charged a daily rental beginning with the first day 
after the loan period expires, to and including the day the cylinders 
are delivered to the Contractor (if the original delivery was f.o.b. 
origin) or are delivered or 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 $----
-------- [Contracting Officer shall insert dollar amount for rental, 
after evaluation of offers] per cylinder, per day, computed separately 
for cylinders by type, size, and capacity and for each point of delivery 
named in the contract. No rental shall accrue to the Contractor in 
excess of replacement value per cylinder specified in paragraph (c) of 
this clause.
    (c) For each cylinder lost or damaged beyond repair while in the 
Government's possession, the Government shall pay to the Contractor the 
replacement value, less the allocable rental paid for that cylinder as 
follows: -------------------- [Contracting Officer shall insert the 
cylinder types, sizes, capacities, and associated replacement values.] 
These cylinders shall become Government property.
    (d) If any lost cylinder is located within -------------------- 
[Contracting Officer shall 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 an amount 
equal to 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 cylinder was delivered to the Contractor.

[[Page 368]]

                             (End of clause)

[59 FR 11386, Mar. 10, 1994]



Sec.  52.247-67  Submission of Commercial Transportation Bills to the 
General Services Administration for Audit.

    As prescribed in 47.104-4(c), insert the following clause:

 Submission of Commercial Transportation Bills to the General Services 
                   Administration for Audit (JUN 1997)

    (a)(1) In accordance with paragraph (a)(2) of this clause, the 
Contractor shall submit to the General Services Administration (GSA) for 
audit, legible copies of all paid freight bills/invoices, commercial 
bills of lading (CBL's), passenger coupons, and other supporting 
documents for transportation services on which the United States will 
assume freight charges that were paid (i) by the Contractor under a 
cost-reimbursement contract, and (ii) by a first-tier subcontractor 
under a cost-reimbursement subcontract thereunder.
    (2) Cost-reimbursement Contractors shall only submit for audit those 
CBL's with freight shipment charges exceeding $50.00. Bills under $50.00 
shall be retained on-site by the Contractor and made available for GSA 
on-site audits. This exception only applies to freight shipment bills 
and is not intended to apply to bills and invoices for any other 
transportation services.
    (b) The Contractor shall forward copies of paid freight bills/
invoices, CBL's, passenger coupons, and supporting documents as soon as 
possible following the end of the month, in one package to the General 
Services Administration, ATTN: FWA, 1800 F Street, NW, Washington, DC 
20405. The Contractor shall include the paid freight bills/invoices, 
CBL's, passenger coupons, and supporting documents for first-tier 
subcontractors under a cost-reimbursement contract. If the inclusion of 
the paid freight bills/invoices, CBL's, passenger coupons, and 
supporting documents for any subcontractor in the shipment is not 
practicable, the documents may be forwarded to GSA in a separate 
package.
    (c) Any original transportation bills or other documents requested 
by GSA shall be forwarded promptly by the Contractor to GSA. The 
Contractor shall ensure that the name of the contracting agency is 
stamped or written on the face of the bill before sending it to GSA.
    (d) A statement prepared in duplicate by the Contractor shall 
accompany each shipment of transportation documents. GSA will 
acknowledge receipt of the shipment by signing and returning the copy of 
the statement. The statement shall show--
    (1) The name and address of the Contractor;
    (2) The contract number including any alpha-numeric prefix 
identifying the contracting office;
    (3) The name and address of the contracting office;
    (4) The total number of bills submitted with the statement; and
    (5) A listing of the respective amounts paid or, in lieu of such 
listing, an adding machine tape of the amounts paid showing the 
Contractor's voucher or check numbers.

                             (End of clause)

[59 FR 67055, Dec. 28, 1994, as amended at 62 FR 40238, July 25, 1997]



Sec.  52.248-1  Value Engineering.

    As prescribed in 48.201, insert the following clause:

                      Value Engineering (FEB 2000)

    (a) General. The Contractor is encouraged to develop, prepare, and 
submit value engineering change proposals (VECP's) voluntarily. The 
Contractor shall share in any net acquisition savings realized from 
accepted VECP's, in accordance with the incentive sharing rates in 
paragraph (f) below.
    (b) Definitions. Acquisition savings, as used in this clause, means 
savings resulting from the application of a VECP to contracts awarded by 
the same contracting office or its successor for essentially the same 
unit. Acquisition savings include--
    (1) Instant contract savings, which are the net cost reductions on 
this, the instant contract, and which are equal to the instant unit cost 
reduction multiplied by the number of instant contract units affected by 
the VECP, less the Contractor's allowable development and implementation 
costs;
    (2) Concurrent contract savings, which are net reductions in the 
prices of other contracts that are definitized and ongoing at the time 
the VECP is accepted; and
    (3) Future contract savings, which are the product of the future 
unit cost reduction multiplied by the number of future contract units in 
the sharing base. On an instant contract, future contract savings 
include savings on increases in quantities after VECP acceptance that 
are due to contract modifications, exercise of options, additional 
orders, and funding of subsequent year requirements on a multiyear 
contract.
    Collateral costs, as used in this clause, means agency cost of 
operation, maintenance, logistic support, or Government-furnished 
property.
    Collateral savings, as used in this clause, means those measurable 
net reductions resulting from a VECP in the agency's overall projected 
collateral costs, exclusive of acquisition savings, whether or not the 
acquisition cost changes.

[[Page 369]]

    Contracting office includes any contracting office that the 
acquisition is transferred to, such as another branch of the agency or 
another agency's office that is performing a joint acquisition action.
    Contractor's development and implementation costs, as used in this 
clause, means those costs the Contractor incurs on a VECP specifically 
in developing, testing, preparing, and submitting the VECP, as well as 
those costs the Contractor incurs to make the contractual changes 
required by Government acceptance of a VECP.
    Future unit cost reduction, as used in this clause, means the 
instant unit cost reduction adjusted as the Contracting Officer 
considers necessary for projected learning or changes in quantity during 
the sharing period. It is calculated at the time the VECP is accepted 
and applies either (1) throughout the sharing period, unless the 
Contracting Officer decides that recalculation is necessary because 
conditions are significantly different from those previously anticipated 
or (2) to the calculation of a lump-sum payment, which cannot later be 
revised.
    Government costs, as used in this clause, means those agency costs 
that result directly from developing and implementing the VECP, such as 
any net increases in the cost of testing, operations, maintenance, and 
logistics support. The term does not include the normal administrative 
costs of processing the VECP or any increase in this contract's cost or 
price resulting from negative instant contract savings.
    Instant contract, as used in this clause, means this contract, under 
which the VECP is submitted. It does not include increases in quantities 
after acceptance of the VECP that are due to contract modifications, 
exercise of options, or additional orders. If this is a multiyear 
contract, the term does not include quantities funded after VECP 
acceptance. If this contract is a fixed-price contract with prospective 
price redetermination, the term refers to the period for which firm 
prices have been established.
    Instant unit cost reduction means the amount of the decrease in unit 
cost of performance (without deducting any Contractor's development or 
implementation costs) resulting from using the VECP on this, the instant 
contract. If this is a service contract, the instant unit cost reduction 
is normally equal to the number of hours per line-item task saved by 
using the VECP on this contract, multiplied by the appropriate contract 
labor rate.
    Negative instant contract savings means the increase in the cost or 
price of this contract when the acceptance of a VECP results in an 
excess of the Contractor's allowable development and implementation 
costs over the product of the instant unit cost reduction multiplied by 
the number of instant contract units affected.
    Net acquisition savings means total acquisition savings, including 
instant, concurrent, and future contract savings, less Government costs.
    Sharing base, as used in this clause, means the number of affected 
end items on contracts of the contracting office accepting the VECP.
    Sharing period, as used in this clause, means the period beginning 
with acceptance of the first unit incorporating the VECP and ending at a 
calendar date or event determined by the contracting officer for each 
VECP.
    Unit, as used in this clause, means the item or task to which the 
Contracting Officer and the Contractor agree the VECP applies.
    Value engineering change proposal (VECP) means a proposal that--
    (1) Requires a change to this, the instant contract, to implement; 
and
    (2) Results in reducing the overall projected cost to the agency 
without impairing essential functions or characteristics; provided, that 
it does not involve a change--
    (i) In deliverable end item quantities only;
    (ii) In research and development (R&D) end items or R&D test 
quantities that is due solely to results of previous testing under this 
contract; or
    (iii) To the contract type only.
    (c) VECP preparation. As a minimum, the Contractor shall include in 
each VECP the information described in subparagraphs (1) through (8) 
below. If the proposed change is affected by contractually required 
configuration management or similar procedures, the instructions in 
those procedures relating to format, identification, and priority 
assignment shall govern VECP preparation. The VECP shall include the 
following:
    (1) A description of the difference between the existing contract 
requirement and the proposed requirement, the comparative advantages and 
disadvantages of each, a justification when an item's function or 
characteristics are being altered, the effect of the change on the end 
item's performance, and any pertinent objective test data.
    (2) A list and analysis of the contract requirements that must be 
changed if the VECP is accepted, including any suggested specification 
revisions.
    (3) Identification of the unit to which the VECP applies.
    (4) A separate, detailed cost estimate for (i) the affected portions 
of the existing contract requirement and (ii) the VECP. The cost 
reduction associated with the VECP shall take into account the 
Contractor's allowable development and implementation costs, including 
any amount attributable to subcontracts under the Subcontracts paragraph 
of this clause, below.
    (5) A description and estimate of costs the Government may incur in 
implementing the

[[Page 370]]

VECP, such as test and evaluation and operating and support costs.
    (6) A prediction of any effects the proposed change would have on 
collateral costs to the agency.
    (7) A statement of the time by which a contract modification 
accepting the VECP must be issued in order to achieve the maximum cost 
reduction, noting any effect on the contract completion time or delivery 
schedule.
    (8) Identification of any previous submissions of the VECP, 
including the dates submitted, the agencies and contract numbers 
involved, and previous Government actions, if known.
    (d) Submission. The Contractor shall submit VECP's to the 
Contracting Officer, unless this contract states otherwise. If this 
contract is administered by other than the contracting office, the 
Contractor shall submit a copy of the VECP simultaneously to the 
Contracting Officer and to the Administrative Contracting Officer.
    (e) Government action. (1) The Contracting Officer will notify the 
Contractor of the status of the VECP within 45 calendar days after the 
contracting office receives it. If additional time is required, the 
Contracting Officer will notify the Contractor within the 45-day period 
and provide the reason for the delay and the expected date of the 
decision. The Government will process VECP's expeditiously; however, it 
will not be liable for any delay in acting upon a VECP.
    (2) If the VECP is not accepted, the Contracting Officer will notify 
the Contractor in writing, explaining the reasons for rejection. The 
Contractor may withdraw any VECP, in whole or in part, at any time 
before it is accepted by the Government. The Contracting Officer may 
require that the Contractor provide written notification before 
undertaking significant expenditures for VECP effort.
    (3) Any VECP may be accepted, in whole or in part, by the 
Contracting Officer's award of a modification to this contract citing 
this clause and made either before or within a reasonable time after 
contract performance is completed. Until such a contract modification 
applies a VECP to this contract, the Contractor shall perform in 
accordance with the existing contract. The decision to accept or reject 
all or part of any VECP is a unilateral decision made solely at the 
discretion of the Contracting Officer.
    (f) Sharing rates. If a VECP is accepted, the Contractor shall share 
in net acquisition savings according to the percentages shown in the 
table below. The percentage paid the Contractor depends upon (1) this 
contract's type (fixed-price, incentive, or cost-reimbursement), (2) the 
sharing arrangement specified in paragraph (a) above (incentive, program 
requirement, or a combination as delineated in the Schedule), and (3) 
the source of the savings (the instant contract, or concurrent and 
future contracts), as follows:

                                  Contractor's Share of Net Acquisition Savings
                                              [Figures in Percent]
----------------------------------------------------------------------------------------------------------------
                                                                      Sharing arrangement
                                             -------------------------------------------------------------------
                                                    Incentive (voluntary)        Program requirement (mandatory)
                Contract type                -------------------------------------------------------------------
                                                               Con-current and                   Con-current and
                                                  Instant      future contract      Instant      future contract
                                               contract rate         rate        contract rate         rate
----------------------------------------------------------------------------------------------------------------
Fixed-price (includes fixed-price-award-fee;          \1\ 50           \1\ 50               25               25
 excludes other fixed-price incentive
 contracts).................................
Incentive (fixed-price or cost) (other than            (\2\)           \1\ 50            (\2\)               25
 award fee).................................
Cost-reimbursement (includes cost-plus-award-         \3\ 25           \3\ 25               15               15
 fee; excludes other cost-type incentive
 contracts).................................
----------------------------------------------------------------------------------------------------------------
\1\ The Contracting Officer may increase the Contractor's sharing rate to as high as 75 percent for each VECP.
\2\ Same sharing arrangement as the contract's profit or fee adjustment formula.
\3\ The Contracting Officer may increase the Contractor's sharing rate to as high as 50 percent for each VECP.

    (g) Calculating net acquisition savings. (1) Acquisition savings are 
realized when (i) the cost or price is reduced on the instant contract, 
(ii) reductions are negotiated in concurrent contracts, (iii) future 
contracts are awarded, or (iv) agreement is reached on a lump-sum 
payment for future contract savings (see subparagraph (i)(4) below). Net 
acquisition savings are first realized, and the Contractor shall be paid 
a share, when Government costs and any negative instant contract savings 
have been fully offset against acquisition savings.
    (2) Except in incentive contracts, Government costs and any price or 
cost increases resulting from negative instant contract savings shall be 
offset against acquisition savings each time such savings are realized 
until they are fully offset. Then, the Contractor's share is calculated 
by multiplying net acquisition savings by the appropriate Contractor's 
percentage sharing rate (see paragraph (f) above). Additional Contractor

[[Page 371]]

shares of net acquisition savings shall be paid to the Contractor at the 
time realized.
    (3) If this is an incentive contract, recovery of Government costs 
on the instant contract shall be deferred and offset against concurrent 
and future contract savings. The Contractor shall share through the 
contract incentive structure in savings on the instant contract items 
affected. Any negative instant contract savings shall be added to the 
target cost or to the target price and ceiling price, and the amount 
shall be offset against concurrent and future contract savings.
    (4) If the Government does not receive and accept all items on which 
it paid the Contractor's share, the Contractor shall reimburse the 
Government for the proportionate share of these payments.
    (h) Contract adjustment. The modification accepting the VECP (or a 
subsequent modification issued as soon as possible after any 
negotiations are completed) shall--
    (1) Reduce the contract price or estimated cost by the amount of 
instant contract savings, unless this is an incentive contract;
    (2) When the amount of instant contract savings is negative, 
increase the contract price, target price and ceiling price, target 
cost, or estimated cost by that amount;
    (3) Specify the Contractor's dollar share per unit on future 
contracts, or provide the lump-sum payment;
    (4) Specify the amount of any Government costs or negative instant 
contract savings to be offset in determining net acquisition savings 
realized from concurrent or future contract savings; and
    (5) Provide the Contractor's share of any net acquisition savings 
under the instant contract in accordance with the following:
    (i) Fixed-price contracts--add to contract price.
    (ii) Cost-reimbursement contracts--add to contract fee.
    (i) Concurrent and future contract savings. (1) Payments of the 
Contractor's share of concurrent and future contract savings shall be 
made by a modification to the instant contract in accordance with 
subparagraph (h)(5) above. For incentive contracts, shares shall be 
added as a separate firm-fixed-price line item on the instant contract. 
The Contractor shall maintain records adequate to identify the first 
delivered unit for 3 years after final payment under this contract.
    (2) The Contracting Officer shall calculate the Contractor's share 
of concurrent contract savings by (i) subtracting from the reduction in 
price negotiated on the concurrent contract any Government costs or 
negative instant contract savings not yet offset and (ii) multiplying 
the result by the Contractor's sharing rate.
    (3) The Contracting Officer shall calculate the Contractor's share 
of future contract savings by (i) multiplying the future unit cost 
reduction by the number of future contract units scheduled for delivery 
during the sharing period, (ii) subtracting any Government costs or 
negative instant contract savings not yet offset, and (iii) multiplying 
the result by the Contractor's sharing rate.
    (4) When the Government wishes and the Contractor agrees, the 
Contractor's share of future contract savings may be paid in a single 
lump sum rather than in a series of payments over time as future 
contracts are awarded. Under this alternate procedure, the future 
contract savings may be calculated when the VECP is accepted, on the 
basis of the Contracting Officer's forecast of the number of units that 
will be delivered during the sharing period. The Contractor's share 
shall be included in a modification to this contract (see subparagraph 
(h)(3) above) and shall not be subject to subsequent adjustment.
    (5) Alternate no-cost settlement method. When, in accordance with 
subsection 48.104-4 of the Federal Acquisition Regulation, the 
Government and the Contractor mutually agree to use the no-cost 
settlement method, the following applies:
    (i) The Contractor will keep all the savings on the instant contract 
and on its concurrent contracts only.
    (ii) The Government will keep all the savings resulting from 
concurrent contracts placed on other sources, savings from all future 
contracts, and all collateral savings.
    (j) Collateral savings. If a VECP is accepted, the Contracting 
Officer will increase the instant contract amount, as specified in 
paragraph (h)(5) of this clause, by a rate from 20 to 100 percent, as 
determined by the Contracting Officer, of any projected collateral 
savings determined to be realized in a typical year of use after 
subtracting any Government costs not previously offset. However, the 
Contractor's share of collateral savings will not exceed the contract's 
firm-fixed-price, target price, target cost, or estimated cost, at the 
time the VECP is accepted, or $100,000, whichever is greater. The 
Contracting Officer will be the sole determiner of the amount of 
collateral savings.
    (k) Relationship to other incentives. Only those benefits of an 
accepted VECP not rewardable under performance, design-to-cost 
(production unit cost, operating and support costs, reliability and 
maintainability), or similar incentives shall be rewarded under this 
clause. However, the targets of such incentives affected by the VECP 
shall not be adjusted because of VECP acceptance. If this contract 
specifies targets but provides no incentive to surpass them, the value 
engineering sharing shall apply only to the amount of achievement better 
than target.
    (l) Subcontracts. The Contractor shall include an appropriate value 
engineering clause in any subcontract of $100,000 or more and may 
include one in subcontracts of lesser value. In calculating any 
adjustment in

[[Page 372]]

this contract's price for instant contract savings (or negative instant 
contract savings), the Contractor's allowable development and 
implementation costs shall include any subcontractor's allowable 
development and implementation costs, and any value engineering 
incentive payments to a subcontractor, clearly resulting from a VECP 
accepted by the Government under this contract. The Contractor may 
choose any arrangement for subcontractor value engineering incentive 
payments; provided, that the payments shall not reduce the Government's 
share of concurrent or future contract savings or collateral savings.
    (m) Data. The Contractor may restrict the Government's right to use 
any part of a VECP or the supporting data by marking the following 
legend on the affected parts:

``These data, furnished under the Value Engineering clause of contract 
----, shall not be disclosed outside the Government or duplicated, used, 
or disclosed, in whole or in part, for any purpose other than to 
evaluate a value engineering change proposal submitted under the clause. 
This restriction does not limit the Goverment's right to use information 
contained in these data if it has been obtained or is otherwise 
available from the Contractor or from another source without 
limitations.''

    If a VECP is accepted, the Contractor hereby grants the Government 
unlimited rights in the VECP and supporting data, except that, with 
respect to data qualifying and submitted as limited rights technical 
data, the Government shall have the rights specified in the contract 
modification implementing the VECP and shall appropriately mark the 
data. (The terms unlimited rights and limited rights are defined in part 
27 of the Federal Acquisition Regulation.)

                             (End of clause)

    Alternate I (APR 1984). If the contracting officer selects a 
mandatory value engineering program requirement, substitute the 
following paragraph (a) for paragraph (a) of the basic clause:

    (a) General. The Contractor shall (1) engage in a value engineering 
program, and submit value engineering progress reports, as specified in 
the Schedule and (2) submit to the Contracting Officer any resulting 
value engineering change proposals (VECP's). In addition to being paid 
as the Schedule specifies for this mandatory program, the Contractor 
shall share in any net acquisition savings realized from accepted 
VECP's, in accordance with the program requirement sharing rates in 
paragraph (f) below.

    Alternate II (FEB 2000). If the contracting officer selects both a 
value engineering incentive and mandatory value engineering program 
requirement, substitute the following paragraph (a) for paragraph (a) of 
the basic clause:

    (a) General. For those contract line items designated in the 
Schedule as subject to the value engineering program requirement, the 
Contractor shall (1) engage in a value engineering program, and submit 
value engineering progress reports, as specified in the Schedule and (2) 
submit to the Contracting Officer any resulting VECP's. In addition to 
being paid as the Schedule specifies for this mandatory program, the 
Contractor shall share in any net acquisition savings realized from 
VECP's accepted under the program, in accordance with the program 
requirement sharing rates in paragraph (f) below. For remaining areas of 
the contract, the Contractor is encouraged to develop, prepare, and 
submit VECP's voluntarily; for VECP's accepted under these remaining 
areas, the incentive sharing rates apply.The decision on which rate 
applies is a unilateral decision made solely at the discretion of the 
Government.

    Alternate III (APR 1984). When the head of the contracting activity 
determines that the cost of calculating and tracking collateral savings 
will exceed the benefits to be derived in a contract calling for a value 
engineering incentive, delete paragraph (j) from the basic clause and 
redesignate the remaining paragraphs accordingly.

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 5059, Jan. 31, 1989; 
64 FR 51848, Sept. 24, 1999; 64 FR 72449, Dec. 27, 1999]



Sec.  52.248-2  Value Engineering--Architect-Engineer.

    As prescribed in 48.201(f), insert the following clause:

            Value Engineering--Architect-Engineer (MAR 1990)

    (a) General. The Contractor shall (1) perform value engineering (VE) 
services and submit progress reports as specified in the Schedule; and 
(2) submit to the Contracting Officer any resulting value engineering 
proposals (VEP's). Value engineering activities shall be performed 
concurrently with, and without delay to, the schedule set forth in the 
contract. The services shall include VE evaluation and review and study 
of design documents immediately following completion of the 35 percent 
design state or at such stages as the Contracting Officer may direct.

[[Page 373]]

Each separately priced line item for VE services shall define 
specifically the scope of work to be accomplished and may include VE 
studies of items other than design documents. The Contractor shall be 
paid as the contract specifies for this effort, but shall not share in 
savings which may result from acceptance and use of VEP's by the 
Government.
    (b) Definitions.
    Life cycle cost, as used in this clause, is the sum of all costs 
over the useful life of a building, system or product. It includes the 
cost of design, construction, acquisition, operation, maintenance, and 
salvage (resale) value, if any.
    Value engineering, as used in this clause, means an organized effort 
to analyze the functions of systems, equipment, facilities, services, 
and supplies for the purpose of achieving the essential functions at the 
lowest life cycle cost consistent with required performance, 
reliability, quality, and safety.
    Value engineering proposal, as used in this clause, means, in 
connection with an A-E contract, a change proposal developed by 
employees of the Federal Government or contractor value engineering 
personnel under contract to an agency to provide value engineering 
services for the contract or program.
    (c) Submissions. After award of an architect-engineering contract 
the contractor shall--
    (1) Provide the Government with a fee breakdown schedule for the VE 
services (such as criteria review, task team review, and bid package 
review) included in the contract schedule;
    (2) Submit, for approval by the Contracting Officer, a list of team 
members and their respective resumes representing the engineering 
disciplines required to complete the study effort, and evidence of the 
team leader's qualifications and engineering discipline. Subsequent 
changes or substitutions to the approved VE team shall be submitted in 
writing to the Contracting Officer for approval; and
    (3) The team leader shall be responsible for prestudy work assembly 
and shall edit, reproduce, and sign the final report and each VEP. All 
VEP's, even if submitted earlier as an individual submission, shall be 
contained in the final report.
    (d) VEP preparation. As a minimum, the contractor shall include the 
following information in each VEP:
    (1) A description of the difference between the existing the 
proposed design, the comparative advantage and disadvantages of each, a 
justification when an item's function is being altered, the effect of 
the change on system or facility performance, and any pertinent 
objective test data.
    (2) A list and analysis of design criteria or specifications that 
must be changed if the VEP is accepted.
    (3) A separate detailed estimate of the impact on project cost of 
each VEP, if accepted and implemented by the Government.
    (4) A description and estimate of costs the Government may incur in 
implementing the VEP, such as design change cost and test and evaluation 
cost.
    (5) A prediction of any effects the proposed change may have on life 
cycle cost.
    (6) The effect the VEP will have on design or construction 
schedules.
    (e) VEP acceptance. Approved VEP's shall be implemented by bilateral 
modification to this contract.

                             (End of clause)

[55 FR 3889, Feb. 5, 1990]



Sec.  52.248-3  Value Engineering--Construction.

    As prescribed in 48.202, insert the following clause:

               Value Engineering--Construction (FEB 2000)

    (a) General. The Contractor is encouraged to develop, prepare, and 
submit value engineering change proposals (VECP's) voluntarily. The 
Contractor shall share in any instant contract savings realized from 
accepted VECP's, in accordance with paragraph (f) below.
    (b) Definitions. Collateral costs, as used in this clause, means 
agency costs of operation, maintenance, logistic support, or Government-
furnished property.
    Collateral savings, as used in this clause, means those measurable 
net reductions resulting from a VECP in the agency's overall projected 
collateral costs, exlcusive of acquisition savings, whether or not the 
acquisition cost changes.
    Contractor's development and implementation costs, as used in this 
clause, means those costs the Contractor incurs on a VECP specifically 
in developing, testing, preparing, and submitting the VECP, as well as 
those costs the Contractor incurs to make the contractual changes 
required by Government acceptance of a VECP.
    Government costs, as used in this clause, means those agency costs 
that result directly from developing and implementing the VECP, such as 
any net increases in the cost of testing, operations, maintenance, and 
logistic support. The term does not include the normal administrative 
costs of processing the VECP.
    Instant contract savings, as used in this clause, means the 
estimated reduction in Contractor cost of performance resulting

[[Page 374]]

from acceptance of the VECP, minus allowable Contractor's development 
and implementation costs, including subcontractors' development and 
implementation costs (see paragraph (h) below).
    Value engineering change proposal (VECP) means a proposal that--
    (1) Requires a change to this, the instant contract, to implement; 
and
    (2) Results in reducing the contract price or estimated cost without 
impairing essential functions or characteristics; provided, that it does 
not involve a change--
    (i) In deliverable end item quantities only; or
    (ii) To the contract type only.
    (c) VECP preparation. As a minimum, the Contractor shall include in 
each VECP the information described in subparagraphs (1) through (7) 
below. If the proposed change is affected by contractually required 
configuration management or similar procedures, the instructions in 
those procedures relating to format, identification, and priority 
assignment shall govern VECP preparation. The VECP shall include the 
following:
    (1) A description of the difference between the existing contract 
requirement and that proposed, the comparative advantages and 
disadvantages of each, a justification when an item's function or 
characteristics are being altered, and the effect of the change on the 
end item's performance.
    (2) A list and analysis of the contract requirements that must be 
changed if the VECP is accepted, including any suggested specification 
revisions.
    (3) A separate, detailed cost estimate for (i) the affected portions 
of the existing contract requirement and (ii) the VECP. The cost 
reduction associated with the VECP shall take into account the 
Contractor's allowable development and implementation costs, including 
any amount attributable to subcontracts under paragraph (h) below.
    (4) A description and estimate of costs the Government may incur in 
implementing the VECP, such as test and evaluation and operating and 
support costs.
    (5) A prediction of any effects the proposed change would have on 
collateral costs to the agency.
    (6) A statement of the time by which a contract modification 
accepting the VECP must be issued in order to achieve the maximum cost 
reduction, noting any effect on the contract completion time or delivery 
schedule.
    (7) Identification of any previous submissions of the VECP, 
including the dates submitted, the agencies and contract numbers 
involved, and previous Government actions, if known.
    (d) Submission. The Contractor shall submit VECP's to the Resident 
Engineer at the worksite, with a copy to the Contracting Officer.
    (e) Government action. (1) The Contracting Officer will notify the 
Contractor of the status of the VECP within 45 calendar days after the 
contracting office receives it. If additional time is required, the 
Contracting Officer will notify the Contractor within the 45-day period 
and provide the reason for the delay and the expected date of the 
decision. The Government will process VECP's expeditiously; however, it 
will not be liable for any delay in acting upon a VECP.
    (2) If the VECP is not accepted, the Contracting Officer will notify 
the Contractor in writing, explaining the reasons for rejection. The 
Contractor may withdraw any VECP, in whole or in part, at any time 
before it is accepted by the Government. The Contracting Officer may 
require that the Contractor provide written notification before 
undertaking significant expenditures for VECP effort.
    (3) Any VECP may be accepted, in whole or in part, by the 
Contracting Officer's award of a modification to this contract citing 
this clause. The Contracting Officer may accept the VECP, even though an 
agreement on price reduction has not been reached, by issuing the 
Contractor a notice to proceed with the change. Until a notice to 
proceed is issued or a contract modification applies a VECP to this 
contract, the Contractor shall perform in accordance with the existing 
contract. The decision to accept or reject all or part of any VECP is a 
unilateral decision made solely at the discretion of the Contracting 
Officer.
    (f) Sharing. (1) Rates. The Government's share of savings is 
determined by subtracting Government costs from instant contract savings 
and multiplying the result by (i) 45 percent for fixed-price contracts 
or (ii) 75 percent for cost-reimbursement contracts.
    (2) Payment. Payment of any share due the Contractor for use of a 
VECP on this contract shall be authorized by a modification to this 
contract to--
    (i) Accept the VECP;
    (ii) Reduce the contract price or estimated cost by the amount of 
instant contract savings; and
    (iii) Provide the Contractor's share of savings by adding the amount 
calculated to the contract price or fee.
    (g) Collateral savings. If a VECP is accepted, the Contracting 
Officer will increase the instant contract amount by 20 percent of any 
projected collateral savings determined to be realized in a typical year 
of use after subtracting any Government costs not previously offset. 
However, the Contractor's share of collateral savings will not exceed 
the contract's firm-fixed-price or estimated cost, at the time the VECP 
is accepted, or $100,000, whichever is greater. The Contracting Officer 
is the sole determiner of the amount of collateral savings.
    (h) Subcontracts. The Contractor shall include an appropriate value 
engineering

[[Page 375]]

clause in any subcontract of $50,000 or more and may include one in 
subcontracts of lesser value. In computing any adjustment in this 
contract's price under paragraph (f) above, the Contractor's allowable 
development and implementation costs shall include any subcontractor's 
allowable development and implementation costs clearly resulting from a 
VECP accepted by the Government under this contract, but shall exclude 
any value engineering incentive payments to a subcontractor. The 
Contractor may choose any arrangement for subcontractor value 
engineering incentive payments; provided, that these payments shall not 
reduce the Government's share of the savings resulting from the VECP.
    (i) Data. The Contractor may restrict the Government's right to use 
any part of a VECP or the supporting data by marking the following 
legend on the affected parts:

``These data, furnished under the Value Engineering--Construction clause 
of contract ----, shall not be disclosed outside the Government or 
duplicated, used, or disclosed, in whole or in part, for any purpose 
other than to evaluate a value engineering change proposal submitted 
under the clause. This restriction does not limit the Government's right 
to use information contained in these data if it has been obtained or is 
otherwise available from the Contractor or from another source without 
limitations.''

    If a VECP is accepted, the Contractor hereby grants the Government 
unlimited rights in the VECP and supporting data, except that, with 
respect to data qualifying and submitted as limited rights technical 
data, the Government shall have the rights specified in the contract 
modification implementing the VECP and shall appropriately mark the 
data. (The terms unlimited rights and limited rights are defined in part 
27 of the Federal Acquisition Regulation.)

                             (End of clause)

    Alternate I (APR 1984). When the head of the contracting activity 
determines that the cost of calculating and tracking collateral savings 
will exceed the benefits to be derived in a construction contract, 
delete paragraph (g) from the basic clause and redesignate the remaining 
paragraphs accordingly.

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 5059, Jan. 31, 1989; 
64 FR 72449, Dec. 27, 1999]



Sec.  52.249-1  Termination for Convenience of the Government (Fixed-Price) (Short Form).

    As prescribed in 49.502(a)(1), insert the following clause in 
solicitations and contracts when a fixed-price contract is contemplated 
and the contract amount is expected to be $100,000 or less, except (a) 
if use of the clause at 52.249-4, Termination for Convenience of the 
Government (Services) (Short Form) is appropriate (b), in contracts for 
research and development work with an educational or nonprofit 
institution on a no-profit basis, (c) in contracts for architect-
engineer services, or (d) if one of the clauses prescribed or cited at 
49.505(a), (b), or (e), is appropriate:

Termination for Convenience of the Government (Fixed-Price) (Short Form) 
                               (APR 1984)

    The Contracting Officer, by written notice, may terminate this 
contract, in whole or in part, when it is in the Government's interest. 
If this contract is terminated, the rights, duties, and obligations of 
the parties, including compensation to the Contractor, shall be in 
accordance with part 49 of the Federal Acquisition Regulation in effect 
on the date of this contract.

                             (End of clause)

    Alternate I (APR 1984). If the contract is for dismantling, 
demolition, or removal of improvements, designate the basic clause as 
paragraph (a) and add the following paragraph (b):

    (b) Upon receipt of the termination notice, if title to property is 
vested in the Contractor under this contract, it shall revest in the 
Government regardless of any other clause of the contract, except for 
property that the Contractor (a) disposed of by bona fide sale or (b) 
removed from the site.



Sec.  52.249-2  Termination for Convenience of the Government (Fixed-Price).

    As prescribed in 49.502(b)(1)(i), insert the following clause:

 Termination for Convenience of the Government (Fixed-Price) (SEP 1996)

    (a) The Government may terminate performance of work under this 
contract in whole or, from time to time, in part if the Contracting 
Officer determines that a termination is in the Government's interest. 
The Contracting Officer shall terminate by delivering to the Contractor 
a Notice of Termination specifying the extent of termination and the 
effective date.

[[Page 376]]

    (b) After receipt of a Notice of Termination, and except as directed 
by the Contracting Officer, the Contractor shall immediately proceed 
with the following obligations, regardless of any delay in determining 
or adjusting any amounts due under this clause:
    (1) Stop work as specified in the notice.
    (2) Place no further subcontracts or orders (referred to as 
subcontracts in this clause) for materials, services, or facilities, 
except as necessary to complete the continued portion of the contract.
    (3) Terminate all subcontracts to the extent they relate to the work 
terminated.
    (4) Assign to the Government, as directed by the Contracting 
Officer, all right, title, and interest of the Contractor under the 
subcontracts terminated, in which case the Government shall have the 
right to settle or to pay any termination settlement proposal arising 
out of those terminations.
    (5) With approval or ratification to the extent required by the 
Contracting Officer, settle all outstanding liabilities and termination 
settlement proposals arising from the termination of subcontracts; the 
approval or ratification will be final for purposes of this clause.
    (6) As directed by the Contracting Officer, transfer title and 
deliver to the Government (i) the fabricated or unfabricated parts, work 
in process, completed work, supplies, and other material produced or 
acquired for the work terminated, and (ii) the completed or partially 
completed plans, drawings, information, and other property that, if the 
contract had been completed, would be required to be furnished to the 
Government.
    (7) Complete performance of the work not terminated.
    (8) Take any action that may be necessary, or that the Contracting 
Officer may direct, for the protection and preservation of the property 
related to this contract that is in the possession of the Contractor and 
in which the Government has or may acquire an interest.
    (9) Use its best efforts to sell, as directed or authorized by the 
Contracting Officer, any property of the types referred to in 
subparagraph (b)(6) of this clause; provided, however, that the 
Contractor (i) is not required to extend credit to any purchaser and 
(ii) may acquire the property under the conditions prescribed by, and at 
prices approved by, the Contracting Officer. The proceeds of any 
transfer or disposition will be applied to reduce any payments to be 
made by the Government under this contract, credited to the price or 
cost of the work, or paid in any other manner directed by the 
Contracting Officer.
    (c) The Contractor shall submit complete termination inventory 
schedules no later than 120 days from the effective date of termination, 
unless extended in writing by the Contracting Officer upon written 
request of the Contractor within this 120-day period.
    (d) After expiration of the plant clearance period as defined in 
subpart 45.6 of the Federal Acquisition Regulation, the Contractor may 
submit to the Contracting Officer a list, certified as to quantity and 
quality, of termination inventory not previously disposed of, excluding 
items authorized for disposition by the Contracting Officer. The 
Contractor may request the Government to remove those items or enter 
into an agreement for their storage. Within 15 days, the Government will 
accept title to those items and remove them or enter into a storage 
agreement. The Contracting Officer may verify the list upon removal of 
the items, or if stored, within 45 days from submission of the list, and 
shall correct the list, as necessary, before final settlement.
    (e) After termination, the Contractor shall submit a final 
termination settlement proposal to the Contracting Officer in the form 
and with the certification prescribed by the Contracting Officer. The 
Contractor shall submit the proposal promptly, but no later than 1 year 
from the effective date of termination, unless extended in writing by 
the Contracting Officer upon written request of the Contractor within 
this 1-year period. However, if the Contracting Officer determines that 
the facts justify it, a termination settlement proposal may be received 
and acted on after 1 year or any extension. If the Contractor fails to 
submit the proposal within the time allowed, the Contracting Officer may 
determine, on the basis of information available, the amount, if any, 
due the Contractor because of the termination and shall pay the amount 
determined.
    (f) Subject to paragraph (e) of this clause, the Contractor and the 
Contracting Officer may agree upon the whole or any part of the amount 
to be paid or remaining to be paid because of the termination. The 
amount may include a reasonable allowance for profit on work done. 
However, the agreed amount, whether under this paragraph (f) or 
paragraph (g) of this clause, exclusive of costs shown in subparagraph 
(g)(3) of this clause, may not exceed the total contract price as 
reduced by (1) the amount of payments previously made and (2) the 
contract price of work not terminated. The contract shall be modified, 
and the Contractor paid the agreed amount. Paragraph (g) of this clause 
shall not limit, restrict, or affect the amount that may be agreed upon 
to be paid under this paragraph.
    (g) If the Contractor and the Contracting Officer fail to agree on 
the whole amount to be paid because of the termination of work, the 
Contracting Officer shall pay the Contractor the amounts determined by 
the Contracting Officer as follows, but without duplication of any 
amounts agreed on under paragraph (f) of this clause:

[[Page 377]]

    (1) The contract price for completed supplies or services accepted 
by the Government (or sold or acquired under subparagraph (b)(9) of this 
clause) not previously paid for, adjusted for any saving of freight and 
other charges.
    (2) The total of--
    (i) The costs incurred in the performance of the work terminated, 
including initial costs and preparatory expense allocable thereto, but 
excluding any costs attributable to supplies or services paid or to be 
paid under subparagraph (g)(1) of this clause;
    (ii) The cost of settling and paying termination settlement 
proposals under terminated subcontracts that are properly chargeable to 
the terminated portion of the contract if not included in subdivision 
(g)(2)(i) of this clause; and
    (iii) A sum, as profit on subdivision (g)(2)(i) of this clause, 
determined by the Contracting Officer under 49.202 of the Federal 
Acquisition Regulation, in effect on the date of this contract, to be 
fair and reasonable; however, if it appears that the Contractor would 
have sustained a loss on the entire contract had it been completed, the 
Contracting Officer shall allow no profit under this subdivision (iii) 
and shall reduce the settlement to reflect the indicated rate of loss.
    (3) The reasonable costs of settlement of the work terminated, 
including--
    (i) Accounting, legal, clerical, and other expenses reasonably 
necessary for the preparation of termination settlement proposals and 
supporting data;
    (ii) The termination and settlement of subcontracts (excluding the 
amounts of such settlements); and
    (iii) Storage, transportation, and other costs incurred, reasonably 
necessary for the preservation, protection, or disposition of the 
termination inventory.
    (h) Except for normal spoilage, and except to the extent that the 
Government expressly assumed the risk of loss, the Contracting Officer 
shall exclude from the amounts payable to the Contractor under paragraph 
(g) of this clause, the fair value, as determined by the Contracting 
Officer, of property that is destroyed, lost, stolen, or damaged so as 
to become undeliverable to the Government or to a buyer.
    (i) The cost principles and procedures of part 31 of the Federal 
Acquisition Regulation, in effect on the date of this contract, shall 
govern all costs claimed, agreed to, or determined under this clause.
    (j) The Contractor shall have the right of appeal, under the 
Disputes clause, from any determination made by the Contracting Officer 
under paragraph (e), (g), or (l) of this clause, except that if the 
Contractor failed to submit the termination settlement proposal or 
request for equitable adjustment within the time provided in paragraph 
(e) or (l), respectively, and failed to request a time extension, there 
is no right of appeal.
    (k) In arriving at the amount due the Contractor under this clause, 
there shall be deducted--
    (1) All unliquidated advance or other payments to the Contractor 
under the terminated portion of this contract;
    (2) Any claim which the Government has against the Contractor under 
this contract; and
    (3) The agreed price for, or the proceeds of sale of, materials, 
supplies, or other things acquired by the Contractor or sold under the 
provisions of this clause and not recovered by or credited to the 
Government.
    (l) If the termination is partial, the Contractor may file a 
proposal with the Contracting Officer for an equitable adjustment of the 
price(s) of the continued portion of the contract. The Contracting 
Officer shall make any equitable adjustment agreed upon. Any proposal by 
the Contractor for an equitable adjustment under this clause shall be 
requested within 90 days from the effective date of termination unless 
extended in writing by the Contracting Officer.
    (m)(1) The Government may, under the terms and conditions it 
prescribes, make partial payments and payments against costs incurred by 
the Contractor for the terminated portion of the contract, if the 
Contracting Officer believes the total of these payments will not exceed 
the amount to which the Contractor will be entitled.
    (2) If the total payments exceed the amount finally determined to be 
due, the Contractor shall repay the excess to the Government upon 
demand, together with interest computed at the rate established by the 
Secretary of the Treasury under 50 U.S.C. App. 1215(b)(2). Interest 
shall be computed for the period from the date the excess payment is 
received by the Contractor to the date the excess is repaid. Interest 
shall not be charged on any excess payment due to a reduction in the 
Contractor's termination settlement proposal because of retention or 
other disposition of termination inventory until 10 days after the date 
of the retention or disposition, or a later date determined by the 
Contracting Officer because of the circumstances.
    (n) Unless otherwise provided in this contract or by statute, the 
Contractor shall maintain all records and documents relating to the 
terminated portion of this contract for 3 years after final settlement. 
This includes all books and other evidence bearing on the Contractor's 
costs and expenses under this contract. The Contractor shall make these 
records and documents available to the Government, at the Contractor's 
office, at all reasonable times, without any direct charge. If approved 
by the Contracting Officer, photographs, microphotographs, or

[[Page 378]]

other authentic reproductions may be maintained instead of original 
records and documents.

                             (End of clause)

    Alternate I (SEP 1996). If the contract is for construction, 
substitute the following paragraph (g) for paragraph (g) of the basic 
clause:

    (g) If the Contractor and Contracting Officer fail to agree on the 
whole amount to be paid the Contractor because of the termination of 
work, the Contracting Officer shall pay the Contractor the amounts 
determined as follows, but without duplication of any amounts agreed 
upon under paragraph (f) of this clause:
    (1) For contract work performed before the effective date of 
termination, the total (without duplication of any items) of--
    (i) The cost of this work;
    (ii) The cost of settling and paying termination settlement 
proposals under terminated subcontracts that are properly chargeable to 
the terminated portion of the contract if not included in subdivision 
(g)(1)(i) of this clause; and
    (iii) A sum, as profit on subdivision (g)(1)(i) of this clause, 
determined by the Contracting Officer under 49.202 of the Federal 
Acquisition Regulation, in effect on the date of this contract, to be 
fair and reasonable; however, if it appears that the Contractor would 
have sustained a loss on the entire contract had it been completed, the 
Contracting Officer shall allow no profit under this subdivision (iii) 
and shall reduce the settlement to reflect the indicated rate of loss.
    (2) The reasonable costs of settlement of the work terminated, 
including--
    (i) Accounting, legal, clerical, and other expenses reasonably 
necessary for the preparation of termination settlement proposals and 
supporting data;
    (ii) The termination and settlement of subcontracts (excluding the 
amounts of such settlements); and
    (iii) Storage, transportation, and other costs incurred, reasonably 
necessary for the preservation, protection, or disposition of the 
termination inventory.

    Alternate II (SEP 1996). If the contract is with an agency of the 
U.S. Government or with State, local, or foreign governments or their 
agencies, and if the Contracting Officer determines that the requirement 
to pay interest on excess partial payments is inappropriate, delete 
subparagraph (m)(2) of the basic clause.
    Alternate III (SEP 1996). If the contract is for construction and 
with an agency of the U.S. Government or with State, local, or foreign 
governments or their agencies, substitute the following paragraph (g) 
for paragraph (g) of the basic clause. Subparagraph (m)(2) may be 
deleted from the basic clause if the Contracting Officer determines that 
the requirement to pay interest on excess partial payments is 
inappropriate.

    (g) If the Contractor and Contracting Officer fail to agree on the 
whole amount to be paid the Contractor because of the termination of 
work, the Contracting Officer shall pay the Contractor the amounts 
determined as follows, but without duplication of any amounts agreed 
upon under paragraph (f) of this clause:
    (1) For contract work performed before the effective date of 
termination, the total (without duplication of any items) of--
    (i) The cost of this work;
    (ii) The cost of settling and paying termination settlement 
proposals under terminated subcontracts that are properly chargeable to 
the terminated portion of the contract if not included in subdivision 
(g)(1)(i) of this clause; and
    (iii) A sum, as profit on subdivision (g)(1)(i) of this clause, 
determined by the Contracting Officer under 49.202 of the Federal 
Acquisition Regulation, in effect on the date of this contract, to be 
fair and reasonable; however, if it appears that the Contractor would 
have sustained a loss on the entire contract had it been completed, the 
Contracting Officer shall allow no profit under this subdivision (iii) 
and shall reduce the settlement to reflect the indicated rate of loss.
    (2) The reasonable costs of settlement of the work terminated, 
including--
    (i) Accounting, legal, clerical, and other expenses reasonably 
necessary for the preparation of termination settlement proposals and 
supporting data;
    (ii) The termination and settlement of subcontracts (excluding the 
amounts of such settlements); and
    (iii) Storage, transportation, and other costs incurred, reasonably 
necessary for the preservation, protection, or disposition of the 
termination inventory.

[48 FR 42478, Sept. 19, 1983, as amended at 55 FR 38518, Sept. 18, 1990; 
61 FR 31666, June 20, 1996; 61 FR 39222, July 26, 1996]



Sec.  52.249-3  Termination for Convenience of the Government (Dismantling, 
Demolition, or Removal of Improvements).

    As prescribed in 49.502(b)(2), insert the following clause:

[[Page 379]]

Termination for Convenience of the Government (Dismantling, Demolition, 
                 or Removal of Improvements) (SEP 1996)

    (a) The Government may terminate performance of work under this 
contract, in whole or, from time to time, in part if the Contracting 
Officer determines that a termination is in the Government's interest. 
The Contracting Officer shall terminate by delivering to the Contractor 
a Notice of Termination specifying the extent of termination and the 
effective date. Upon receipt of the notice, if title to property is 
vested in the Contractor under this contract, it shall revest in the 
Government regardless of any other clause of this contract, except for 
property that the Contractor disposed of by bona fide sale or removed 
from the site.
    (b) After receipt of a Notice of Termination, and except as directed 
by the Contracting Officer, the Contractor shall immediately proceed 
with the following obligations, regardless of delay in determining or 
adjusting any amounts due under this clause:
    (1) Stop work as specified in the notice.
    (2) Place no further subcontracts or orders (referred to as 
subcontracts in this clause) for materials, services, or facilities, 
except as necessary to complete the continued portion of the contract.
    (3) Terminate all subcontracts to the extent they relate to the work 
terminated.
    (4) Assign to the Government, as directed by the Contracting 
Officer, all right, title, and interest of the Contractor under the 
subcontracts terminated, in which case the Government shall have the 
right to settle or to pay any termination settlement proposal arising 
out of those terminations.
    (5) With approval or ratification to the extent required by the 
Contracting Officer, settle all outstanding liabilities and termination 
settlement proposals arising from the termination of subcontracts; the 
approval or ratification will be final for purposes of this clause.
    (6) As directed by the Contracting Officer, transfer title and 
deliver to the Government (i) the fabricated or unfabricated parts, work 
in process, completed work, supplies, and other material produced or 
acquired for the work terminated, and (ii) the completed or partially 
completed plans, drawings, information, and other property that, if the 
contract has been completed, would be required to be furnished to the 
Government.
    (7) Complete performance of the work not terminated.
    (8) Take any action that may be necessary, or that the Contracting 
Officer may direct, for the protection and preservation of the property 
related to this contract that is in the possession of the Contractor and 
in which the Government has or may acquire an interest.
    (9) Use its best efforts to sell, as directed or authorized by the 
Contracting Officer, any property of the types referred to in 
subparagraph (b)(6) of this clause; provided, however, that the 
Contractor (i) is not required to extend credit to any purchaser and 
(ii) may acquire the property under the conditions prescribed by, and at 
prices approved by, the Contracting Officer. The proceeds of any 
transfer or disposition will be applied to reduce any payments to be 
made by the Government under this contract, credited to the price or 
cost of the work, or paid in any other manner directed by the 
Contracting Officer.
    (c) The Contractor shall submit complete termination inventory 
schedules no later than 120 days from the effective date of termination, 
unless extended in writing by the Contracting Officer upon written 
request of the Contractor within this 120-day period.
    (d) After expiration of the plant clearance period as defined in 
subpart 45.6 of the Federal Acquisition Regulation, the Contractor may 
submit to the Contracting Officer a list, certified as to quantity and 
quality, of termination inventory not previously disposed of, excluding 
items authorized for disposition by the Contracting Officer. The 
Contractor may request the Government to remove those items or enter 
into an agreement for their storage. Within 15 days, the Government will 
accept title to those items and remove them or enter into a storage 
agreement. The Contracting Officer may verify the list upon removal of 
the items, or if stored, within 45 days from submission of the list, and 
shall correct the list, as necessary, before final settlement.
    (e) After termination, the Contractor shall submit a final 
termination settlement proposal to the Contracting Officer in the form 
and with the certification prescribed by the Contracting Officer. The 
Contractor shall submit the proposal promptly, but no later than 1 year 
from the effective date of termination, unless extended in writing by 
the Contracting Officer upon written request of the Contractor within 
this 1-year period. However, if the Contracting Officer determines that 
the facts justify it, a termination settlement proposal may be received 
and acted on after 1 year or any extension. If the Contractor fails to 
submit the proposal within the time allowed, the Contracting Officer may 
determine, on the basis of information available, the amount, if any, 
due the Contractor because of the termination and shall pay the amount 
determined.
    (f) Subject to paragraph (e) of this clause, the Contractor and the 
Contracting Officer may agree upon the whole or any part of the amount 
to be paid because of the termination. The amount may include a 
reasonable allowance for profit on work done. However, the agreed 
amount, whether under this paragraph (f) or paragraph (g) of this 
clause,

[[Page 380]]

exclusive of settlement costs, may not exceed the total contract price 
as reduced by (1) the amount of payments previously made and (2) the 
contract price of work not terminated. The contract shall be amended and 
the Contractor paid the agreed amount. Paragraph (g) of this clause 
shall not limit, restrict, or affect the amount that may be agreed upon 
to be paid under this paragraph.
    (g) If the Contractor and the Contracting Officer fail to agree on 
the whole amount to be paid because of the termination of work, the 
Contracting Officer shall pay the Contractor the amounts determined by 
the Contracting Officer as follows, but without duplication of any 
amounts agreed on under paragraph (f) of this clause:
    (1) For contract work performed before the effective date of 
termination, the total (without duplication of any items) of--
    (i) The cost of this work;
    (ii) The cost of settling and paying termination settlement 
proposals under terminated subcontracts that are properly chargeable to 
the terminated portion of the contract, if not included in subdivision 
(g)(1)(i) of this clause; and
    (iii) A sum, as profit on subdivision (g)(1)(i) of this clause, 
determined by the Contracting Officer under section 49.202 of the 
Federal Acquisition Regulation, in effect on the date of this contract, 
to be fair and reasonable; however, if it appears that the Contractor 
would have sustained a loss on the entire contract had it been 
completed, the Contracting Officer shall allow no profit under this 
subdivision (iii) and shall reduce the amount of the settlement to 
reflect the indicated rate of loss.
    (2) The reasonable costs of settlement of the work terminated, 
including--
    (i) Accounting, legal, clerical, and other expenses reasonably 
necessary for the preparation of termination settlement proposals and 
supporting data;
    (ii) The termination and settlement of subcontracts (excluding the 
amounts of such settlements); and
    (iii) Preservation and protection of property under subparagraph 
(b)(8) of this clause.
    (h) Except for normal spoilage, and except to the extent that the 
Government expressly assumed the risk of loss, the Contracting Officer 
shall exclude from the amounts payable to the Contractor under paragraph 
(g) of this clause, the fair value as determined by the Contracting 
Officer, of property that is destroyed, lost, stolen, or damaged so as 
to become undeliverable to the Government or to a buyer.
    (i) The cost principles and procedures of part 31 of the Federal 
Acquisition Regulation, in effect on the date of this contract, shall 
govern all costs claimed, agreed to, or determined under this clause.
    (j) The Contractor shall have the right of appeal, under the 
Disputes clause, from any determination made by the Contracting Officer 
under paragraph (e), (g), or (l) of this clause, except that if the 
Contractor failed to submit the termination settlement proposal within 
the time provided in paragraph (e) or (f) and failed to request a time 
extension, there is no right of appeal. If the Contracting Officer has 
made a determination of the amount due under paragraph (e), (g), or (l) 
of this clause, the Government shall pay the Contractor (1) the amount 
determined by the Contracting Officer, if there is no right of appeal or 
if no timely appeal has been taken, or (2) the amount finally determined 
on an appeal.
    (k) In arriving at the amount due the Contractor under this clause, 
there shall be deducted--
    (1) All unliquidated advance or other payments to the Contractor 
under the terminated portion of this contract;
    (2) Any claim which the Government has against the Contractor under 
this contract; and
    (3) The agreed price for, or the proceeds of sale of, materials, 
supplies, or other things acquired by the Contractor or sold under the 
provisions of this clause and not recovered by or credited to the 
Government.
    (l) If the termination is partial, the Contractor may file a 
proposal with the Contracting Officer for an equitable adjustment of the 
price(s) of the continued portion of the contract. The Contracting 
Officer shall make any equitable adjustment agreed upon. Any proposal by 
the Contractor for an equitable adjustment under this clause shall be 
requested within 90 days from the effective date of termination unless 
extended in writing by the Contracting Officer.
    (m)(1) The Government may, under the terms and conditions it 
prescribes, make partial payments and payments against cost incurred by 
the Contractor for the terminated portion of the contract, if the 
Contracting Officer believes the total of these payments will not exceed 
the amount to which the Contractor will be entitled.
    (2) If the total payments exceed the amount finally determined to be 
due, the Contractor shall repay the excess to the Government upon 
demand, together with interest computed at the rate established by the 
Secretary of the Treasury under 50 U.S.C. App 1215(b)(2). Interest shall 
be computed for the period from the date the excess payment is received 
by the Contractor to the date the excess is repaid. Interest shall not 
be charged on any excess payment due to a reduction in the Contractor's 
termination settlement proposal because of retention or other 
disposition of termination inventory until 10 days after the date of the 
retention or disposition, or a later date determined by the Contracting 
Officer because of the circumstances.

[[Page 381]]

    (n) Unless otherwise provided in this contract or by statute, the 
Contractor shall maintain all records and documents relating to the 
terminated portion of this contract for 3 years after final settlement. 
This includes all books and other evidence bearing on the Contractor's 
costs and expenses under this contract. The Contractor shall make these 
records and documents available to the Government, at the Contractor's 
office, at all reasonable times, without any direct charge. If approved 
by the Contracting Officer, photographs, microphotographs, or other 
authentic reproductions may be maintained instead of original records 
and documents.

                             (End of clause)

    Alternate I (SEP 1996). If the contract is with an agency of the 
U.S. Government or with State, local, or foreign governments or their 
agencies, and if the contracting officer determines that the requirement 
to pay interest on excess partial payments is inappropriate, delete 
subparagraph (m)(2) from the basic clause.

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 39222, July 26, 1996]



Sec.  52.249-4  Termination for Convenience of the Government (Services) 
(Short Form).

    As prescribed in 49.502(c), insert the following clause in 
solicitations and contracts for services, regardless of value, when a 
fixed-price contract is contemplated and the Contracting Officer 
determines that because of the kind of services required, the successful 
offeror will not incur substantial charges in preparation for and in 
carrying out the contract, and would, if terminated for the convenience 
of the Government, limit termination settlement charges to services 
rendered before the date of termination:

 Termination for Convenience of the Government (Services) (Short Form) 
                               (APR 1984)

    The Contracting Officer, by written notice, may terminate this 
contract, in whole or in part, when it is in the Government's interest. 
If this contract is terminated, the Government shall be liable only for 
payment under the payment provisions of this contract for services 
rendered before the effective date of termination.

                             (End of clause)



Sec.  52.249-5  Termination for Convenience of the Government (Educational 
and Other Nonprofit Institutions).

    As prescribed in 49.502(d), insert the following clause:

  Termination for Convenience of the Government (Educational and Other 
                   Nonprofit Institutions) (SEP 1996)

    (a) The Government may terminate performance of work under this 
contract in whole or, from time to time, in part if the Contracting 
Officer determines that a termination is in the Government's interest. 
The Contracting Officer shall terminate by delivering to the Contractor 
a Notice of Termination specifying the extent of termination and the 
effective date.
    (b) After receipt of a Notice of Termination and except as directed 
by the Contracting Officer, the Contractor shall immediately proceed 
with the following obligations:
    (1) Stop work as specified in the notice.
    (2) Place no further subcontracts or orders (referred to as 
subcontracts in this clause), except as necessary to complete the 
continued portion of the contract.
    (3) Terminate all applicable subcontracts and cancel or divert 
applicable commitments covering personal services that extend beyond the 
effective date of termination.
    (4) Assign to the Government, as directed by the Contracting 
Officer, all right, title, and interest of the Contractor under the 
subcontracts terminated, in which case the Government shall have the 
right to settle or pay any termination settlement proposal arising out 
of those terminations.
    (5) With approval or ratification to the extent required by the 
Contracting Officer, settle all outstanding liabilities and termination 
settlement proposals arising from the termination of subcontracts; 
approval or ratification will be final for purposes of this clause.
    (6) Transfer title (if not already transferred) and, as directed by 
the Contracting Officer, deliver to the Government any information and 
items that, if the contract had been completed, would have been required 
to be furnished, including (i) materials or equipment produced, in 
process, or acquired for the work terminated and (ii) completed or 
partially completed plans, drawings, and information.
    (7) Complete performance of the work not terminated.
    (8) Take any action that may be necessary, or that the Contracting 
Officer may direct, for the protection and preservation of the property 
related to this contract that is in the possession of the Contractor and 
in

[[Page 382]]

which the Government has or may acquire an interest.
    (9) Use its best efforts to sell, as directed or authorized by the 
Contracting Officer, termination inventory other than that retained by 
the Government under subparagraph (b)(6) of this clause; provided, 
however, that the Contractor (i) is not required to extend credit to any 
purchaser and (ii) may acquire the property under the conditions 
prescribed by, and at prices approved by, the Contracting Officer. The 
proceeds of any transfer or disposition will be applied to reduce any 
payments to be made by the Government under this contract, credited to 
the price or cost of the work, or paid in any other manner directed by 
the Contracting Officer.
    (c) The Contractor shall submit complete termination inventory 
schedules no later than 120 days from the effective date of termination, 
unless extended in writing by the Contracting Officer upon written 
request of the Contractor within this 120-day period.
    (d) After termination, the Contractor shall submit a final 
termination settlement proposal to the Contracting Officer in the form 
and with the certification prescribed by the Contracting Officer. The 
Contractor shall submit the proposal promptly but no later than 1 year 
from the effective date of termination unless extended in writing by the 
Contracting Officer upon written request of the Contractor within this 
1-year period. If the Contractor fails to submit the termination 
settlement proposal within the time allowed, the Contracting Officer may 
determine, on the basis of information available, the amount, if any, 
due the Contractor because of the termination and shall pay the amount 
determined.
    (e) Subject to paragraph (d) of this clause, the Contractor and the 
Contracting Officer may agree upon the whole or any part of the amount 
to be paid because of the termination. This amount may include 
reasonable cancellation charges incurred by the Contractor and any 
reasonable loss on outstanding commitments for personal services that 
the Contractor is unable to cancel; provided, that the Contractor 
exercised reasonable diligence in diverting such commitments to other 
operations. The contract shall be amended and the Contractor paid the 
agreed amount.
    (f) The cost principles and procedures in subpart 31.3 of the 
Federal Acquisition Regulation (FAR), in effect on the date of the 
contract, shall govern all costs claimed, agreed to, or determined under 
this clause; however, if the Contractor is not an educational 
institution, and is a nonprofit organization under Office of Management 
and Budget (OMB) Circular A-122, Cost Principles for Nonprofit 
Organizations, July 8, 1980, those cost principles shall apply; 
provided, that if the Contractor is a nonprofit institution listed in 
Attachment C of OMB Circular A-122, the cost principles at FAR 31.2 for 
commercial organizations shall apply to such contractor.
    (g) The Government may, under the terms and conditions it 
prescribes, make partial payments against costs incurred by the 
Contractor for the terminated portion of this contract, if the 
Contracting Officer believes the total of these payments will not exceed 
the amount to which the Contractor will be entitled.
    (h) The Contractor has the right of appeal as provided under the 
Disputes clause, except that if the Contractor failed to submit the 
termination settlement proposal within the time provided in paragraph 
(d) of this clause and failed to request a time extension, there is no 
right of appeal.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 39223, July 26, 1996]



Sec.  52.249-6  Termination (Cost-Reimbursement).

    As prescribed in 49.503(a)(1), insert the following clause:

               Termination (Cost-Reimbursement) (SEP 1996)

    (a) The Government may terminate performance of work under this 
contract in whole or, from time to time, in part, if--
    (1) The Contracting Officer determines that a termination is in the 
Government's interest; or
    (2) The Contractor defaults in performing this contract and fails to 
cure the default within 10 days (unless extended by the Contracting 
Officer) after receiving a notice specifying the default. Default 
includes failure to make progress in the work so as to endanger 
performance.
    (b) The Contracting Officer shall terminate by delivering to the 
Contractor a Notice of Termination specifying whether termination is for 
default of the Contractor or for convenience of the Government, the 
extent of termination, and the effective date. If, after termination for 
default, it is determined that the Contractor was not in default or that 
the Contractor's failure to perform or to make progress in performance 
is due to causes beyond the control and without the fault or negligence 
of the Contractor as set forth in the Excusable Delays clause, the 
rights and obligations of the parties will be the same as if the 
termination was for the convenience of the Government.
    (c) After receipt of a Notice of Termination, and except as directed 
by the Contracting Officer, the Contractor shall immediately proceed 
with the following obligations, regardless of any delay in determining

[[Page 383]]

or adjusting any amounts due under this clause:
    (1) Stop work as specified in the notice.
    (2) Place no further subcontracts or orders (referred to as 
subcontracts in this clause), except as necessary to complete the 
continued portion of the contract.
    (3) Terminate all subcontracts to the extent they relate to the work 
terminated.
    (4) Assign to the Government, as directed by the Contracting 
Officer, all right, title, and interest of the Contractor under the 
subcontracts terminated, in which case the Government shall have the 
right to settle or to pay any termination settlement proposal arising 
out of those terminations.
    (5) With approval or ratification to the extent required by the 
Contracting Officer, settle all outstanding liabilities and termination 
settlement proposals arising from the termination of subcontracts, the 
cost of which would be reimbursable in whole or in part, under this 
contract; approval or ratification will be final for purposes of this 
clause.
    (6) Transfer title (if not already transferred) and, as directed by 
the Contracting Officer, deliver to the Government (i) the fabricated or 
unfabricated parts, work in process, completed work, supplies, and other 
material produced or acquired for the work terminated, (ii) the 
completed or partially completed plans, drawings, information, and other 
property that, if the contract had been completed, would be required to 
be furnished to the Government, and (iii) the jigs, dies, fixtures, and 
other special tools and tooling acquired or manufactured for this 
contract, the cost of which the Contractor has been or will be 
reimbursed under this contract.
    (7) Complete performance of the work not terminated.
    (8) Take any action that may be necessary, or that the Contracting 
Officer may direct, for the protection and preservation of the property 
related to this contract that is in the possession of the Contractor and 
in which the Government has or may acquire an interest.
    (9) Use its best efforts to sell, as directed or authorized by the 
Contracting Officer, any property of the types referred to in 
subparagraph (c)(6) of this clause; provided, however, that the 
Contractor (i) is not required to extend credit to any purchaser and 
(ii) may acquire the property under the conditions prescribed by, and at 
prices approved by, the Contracting Officer. The proceeds of any 
transfer or disposition will be applied to reduce any payments to be 
made by the Government under this contract, credited to the price or 
cost of the work, or paid in any other manner directed by the 
Contracting Officer.
    (d) The Contractor shall submit complete termination inventory 
schedules no later than 120 days from the effective date of termination, 
unless extended in writing by the Contracting Officer upon written 
request of the Contractor within this 120-day period.
    (e) After expiration of the plant clearance period as defined in 
subpart 45.6 of the Federal Acquisition Regulation, the Contractor may 
submit to the Contracting Officer a list, certified as to quantity and 
quality, of termination inventory not previously disposed of, excluding 
items authorized for disposition by the Contracting Officer. The 
Contractor may request the Government to remove those items or enter 
into an agreement for their storage. Within 15 days, the Government will 
accept the items and remove them or enter into a storage agreement. The 
Contracting Officer may verify the list upon removal of the items, or if 
stored, within 45 days from submission of the list, and shall correct 
the list, as necessary, before final settlement.
    (f) After termination, the Contractor shall submit a final 
termination settlement proposal to the Contracting Officer in the form 
and with the certification prescribed by the Contracting Officer. The 
Contractor shall submit the proposal promptly, but no later than 1 year 
from the effective date of termination, unless extended in writing by 
the Contracting Officer upon written request of the Contractor within 
this 1-year period. However, if the Contracting Officer determines that 
the facts justify it, a termination settlement proposal may be received 
and acted on after 1 year or any extension. If the Contractor fails to 
submit the proposal within the time allowed, the Contracting Officer may 
determine, on the basis of information available, the amount, if any, 
due the Contractor because of the termination and shall pay the amount 
determined.
    (g) Subject to paragraph (f) of this clause, the Contractor and the 
Contracting Officer may agree on the whole or any part of the amount to 
be paid (including an allowance for fee) because of the termination. The 
contract shall be amended, and the Contractor paid the agreed amount.
    (h) If the Contractor and the Contracting Officer fail to agree in 
whole or in part on the amount of costs and/or fee to be paid because of 
the termination of work, the Contracting Officer shall determine, on the 
basis of information available, the amount, if any, due the Contractor, 
and shall pay that amount, which shall include the following:
    (1) All costs reimbursable under this contract, not previously paid, 
for the performance of this contract before the effective date of the 
termination, and those costs that may continue for a reasonable time 
with the approval of or as directed by the Contracting Officer; however, 
the Contractor shall discontinue these costs as rapidly as practicable.

[[Page 384]]

    (2) The cost of settling and paying termination settlement proposals 
under terminated subcontracts that are properly chargeable to the 
terminated portion of the contract if not included in subparagraph 
(h)(1) of this clause.
    (3) The reasonable costs of settlement of the work terminated, 
including--
    (i) Accounting, legal, clerical, and other expenses reasonably 
necessary for the preparation of termination settlement proposals and 
supporting data;
    (ii) The termination and settlement of subcontracts (excluding the 
amounts of such settlements); and
    (iii) Storage, transportation, and other costs incurred, reasonably 
necessary for the preservation, protection, or disposition of the 
termination inventory. If the termination is for default, no amounts for 
the preparation of the Contractor's termination settlement proposal may 
be included.
    (4) A portion of the fee payable under the contract, determined as 
follows:
    (i) If the contract is terminated for the convenience of the 
Government, the settlement shall include a percentage of the fee equal 
to the percentage of completion of work contemplated under the contract, 
but excluding subcontract effort included in subcontractors' termination 
proposals, less previous payments for fee.
    (ii) If the contract is terminated for default, the total fee 
payable shall be such proportionate part of the fee as the total number 
of articles (or amount of services) delivered to and accepted by the 
Government is to the total number of articles (or amount of services) of 
a like kind required by the contract.
    (5) If the settlement includes only fee, it will be determined under 
subparagraph (h)(4) of this clause.
    (i) The cost principles and procedures in part 31 of the Federal 
Acquisition Regulation, in effect on the date of this contract, shall 
govern all costs claimed, agreed to, or determined under this clause.
    (j) The Contractor shall have the right of appeal, under the 
Disputes clause, from any determination made by the Contracting Officer 
under paragraph (f), (h), or (l) of this clause, except that if the 
Contractor failed to submit the termination settlement proposal within 
the time provided in paragraph (f) and failed to request a time 
extension, there is no right of appeal. If the Contracting Officer has 
made a determination of the amount due under paragraph (f), (h) or (l) 
of this clause, the Government shall pay the Contractor (1) the amount 
determined by the Contracting Officer if there is no right of appeal or 
if no timely appeal has been taken, or (2) the amount finally determined 
on an appeal.
    (k) In arriving at the amount due the Contractor under this clause, 
there shall be deducted--
    (1) All unliquidated advance or other payments to the Contractor, 
under the terminated portion of this contract;
    (2) Any claim which the Government has against the Contractor under 
this contract; and
    (3) The agreed price for, or the proceeds of sale of materials, 
supplies, or other things acquired by the Contractor or sold under this 
clause and not recovered by or credited to the Government.
    (l) The Contractor and Contracting Officer must agree to any 
equitable adjustment in fee for the continued portion of the contract 
when there is a partial termination. The Contracting Officer shall amend 
the contract to reflect the agreement.
    (m)(1) The Government may, under the terms and conditions it 
prescribes, make partial payments and payments against costs incurred by 
the Contractor for the terminated portion of the contract, if the 
Contracting Officer believes the total of these payments will not exceed 
the amount to which the Contractor will be entitled.
    (2) If the total payments exceed the amount finally determined to be 
due, the Contractor shall repay the excess to the Government upon 
demand, together with interest computed at the rate established by the 
Secretary of the Treasury under 50 U.S.C. App. 1215(b)(2). Interest 
shall be computed for the period from the date the excess payment is 
received by the Contractor to the date the excess is repaid. Interest 
shall not be charged on any excess payment due to a reduction in the 
Contractor's termination settlement proposal because of retention or 
other disposition of termination inventory until 10 days after the date 
of the retention or disposition, or a later date determined by the 
Contracting Officer because of the circumstances.
    (n) The provisions of this clause relating to fee are inapplicable 
if this contract does not include a fee.

                             (End of clause)

    Alternate I (SEP 1996). If the contract is for construction, 
substitute the following subparagraph (h)(4) for subparagraph (h)(4) of 
the basic clause:

    (4) A portion of the fee payable under the contract determined as 
follows:
    (i) If the contract is terminated for the convenience of the 
Government, the settlement shall include a percentage of the fee equal 
to the percentage of completion of work contemplated under the contract, 
but excluding subcontract effort included in subcontractors' termination 
settlement proposals, less previous payments for fee.

[[Page 385]]

    (ii) If the contract is terminated for default, the total fee 
payable shall be such proportionate part of the fee as the actual work 
in place is to the total work in place required by the contract.

    Alternate II (SEP 1996). If the contract is with an agency of the 
U.S. Government or with State, local, or foreign governments or their 
agencies, and if the contracting officer determines that the requirement 
to pay interest on excess partial payments is inappropriate, delete 
subparagraph (m)(2) from the basic clause.
    Alternate III (SEP 1996). If the contract is for construction with 
an agency of the U.S. Government or with State, local, or foreign 
governments or their agencies, the following subparagraph (h)(4) shall 
be substituted for subparagraph (h)(4) of the basic clause. Subparagraph 
(m)(2) may be deleted from the basic clause if the contracting officer 
determines that the requirement to pay interest on excess partial 
payments is inappropriate.

    (4) A portion of the fee payable under the contract determined as 
follows:
    (i) If the contract is terminated for the convenience of the 
Government, the settlement shall include a percentage of the fee equal 
to the percentage of completion of work contemplated under the contract, 
but excluding subcontract effort included in subcontractors' termination 
settlement proposals, less previous payments for fee.
    (ii) If the contract is terminated for default, the total fee 
payable shall be such proportionate part of the fee as the actual work 
in place is to the total work in place required by the contract.

    Alternate IV (SEP 1996). If the contract is a time-and-material or 
labor-hour contract, substitute the following paragraphs (h) and (l) for 
paragraphs (h) and (l) of the basic clause:

    (h) If the Contractor and the Contracting Officer fail to agree in 
whole or in part on the amount to be paid because of the termination of 
work, the Contracting Officer shall determine, on the basis of 
information available, the amount, if any, due the Contractor and shall 
pay the amount determined as follows:
    (1) If the termination is for the convenience of the Government, 
include--
    (i) An amount for direct labor hours (as defined in the Schedule of 
the contract) determined by multiplying the number of direct labor hours 
expended before the effective date of termination by the hourly rate(s) 
in the Schedule, less any hourly rate payments already made to the 
contractor;
    (ii) An amount (computed under the provisions for payment of 
materials) for material expenses incurred before the effective date of 
termination, not previously paid to the Contractor;
    (iii) An amount for labor and material expenses computed as if the 
expenses were incurred before the effective date of termination if they 
are reasonably incurred after the effective date, with the approval of 
or as directed by the Contracting Officer; however, the Contractor shall 
discontinue these expenses as rapidly as practicable;
    (iv) If not included in subdivision (h)(1)(i), (ii), or (iii) above, 
the cost of settling and paying termination settlement proposals under 
terminated subcontracts that are properly chargeable to the terminated 
portion of the contract; and
    (v) The reasonable costs of settlement of the work terminated, 
including--
    (A) Accounting, legal, clerical, and other expenses reasonably 
necessary for the preparation of termination settlement proposals and 
supporting data;
    (B) The termination and settlement of subcontracts (excluding the 
amounts of such settlements); and
    (C) Storage, transportation, and other costs incurred, reasonably 
necessary for the protection or disposition of the termination 
inventory.
    (2) If the termination is for default of the Contractor, include the 
amounts computed under subparagraph (h)(1) above but omit--
    (i) Any amount for preparation of the Contractor's termination 
settlement proposal; and
    (ii) The portion of the hourly rate allocable to profit for any 
direct labor hours expended in furnishing materials and services not 
delivered to and accepted by the Government.
    (l) If the termination is partial, the Contractor may file with the 
Contracting Officer a proposal for an equitable adjustment of the 
price(s) for the continued portion of the contract. The Contracting 
Officer shall make any equitable adjustment agreed upon. Any proposal by 
the Contractor for an equitable adjustment under this clause shall be 
requested within 90 days from the effective date of termination, unless 
extended in writing by the Contracting Officer.

    Alternate V (SEP 1996). If the contract is a time-and-material or 
labor-hour contract with an agency of the U.S. Government or with State, 
local or foreign governments or their agencies, substitute the following 
paragraphs (h) and (l) for paragraphs (h) and (l) of the basic clause. 
Subparagraph (m)(2) may be deleted from the basic clause if the 
contracting officer determines that the

[[Page 386]]

requirement to pay interest on excess partial payments is inappropriate.

    (h) If the Contractor and the Contracting Officer fail to agree in 
whole or in part on the amount to be paid because of the termination of 
work, the Contracting Officer shall determine, on the basis of 
information available, the amount, if any, due the Contractor and shall 
pay the amount determined as follows:
    (1) If the termination is for the convenience of the Government, 
include--
    (i) An amount for direct labor hours (as defined in the Schedule of 
the contract) determined by multiplying the number of direct labor hours 
expended before the effective date of termination by the hourly rate(s) 
in the Schedule, less any hourly rate payments already made to the 
Contractor;
    (ii) An amount (computed under the provisions for payment of 
materials) for material expenses incurred before the effective date of 
termination, not previously paid to the Contractor;
    (iii) An amount for labor and material expenses computed as if the 
expenses were incurred before the effective date of termination, if they 
are reasonably incurred after the effective date with the approval of or 
as directed by the Contracting Officer; however, the Contractor shall 
discontinue these expenses as rapidly as practicable;
    (iv) If not included in subdivision (h)(1)(i), (ii), or (iii) above, 
the cost of settling and paying termination settlement proposals under 
terminated subcontracts that are properly chargeable to the terminated 
portion of the contract; and
    (v) The reasonable costs of settlement of the work terminated, 
including--
    (A) Accounting, legal, clerical, and other expenses reasonably 
necessary for the preparation of termination settlement proposals and 
supporting data;
    (B) The termination and settlement of subcontracts (excluding the 
amounts of such settlements); and
    (C) Storage, transportation, and other costs incurred, reasonably 
necessary for the protection or disposition of the termination 
inventory.
    (2) If the termination is for default of the Contractor, include the 
amounts computed under subparagraph (h)(1) of this clause but omit--
    (i) Any amount for preparation of the Contractor's termination 
settlement proposal; and
    (ii) The portion of the hourly rate allocable to profit for any 
direct labor hours expended in furnishing materials and services not 
delivered to and accepted by the Government.
    (l) If the termination is partial, the Contractor may file with the 
Contracting Officer a proposal for an equitable adjustment of the 
price(s) for the continued portion of the contract. The Contracting 
Officer shall make any equitable adjustment agreed upon. Any proposal by 
the Contractor for an equitable adjustment under this clause shall be 
requested within 90 days from the effective date of termination, unless 
extended in writing by the Contracting Officer.

[48 FR 42478, Sept. 19, 1983, as amended at 51 FR 19717, May 30, 1986; 
61 FR 39223, July 26, 1996]



Sec.  52.249-7  Termination (Fixed-Price Architect-Engineer).

    As prescribed in 49.503(b), insert the following clause in 
solicitations and contracts for architect-engineer services when a 
fixed-price contract is contemplated:

         Termination (Fixed-Price Architect-Engineer) (APR 1984)

    (a) The Government may terminate this contract in whole or, from 
time to time, in part, for the Government's convenience or because of 
the failure of the Contractor to fulfill the contract obligations. The 
Contracting Officer shall terminate by delivering to the Contractor a 
Notice of Termination specifying the nature, extent, and effective date 
of the termination. Upon receipt of the notice, the Contractor shall (1) 
immediately discontinue all services affected (unless the notice directs 
otherwise), and (2) deliver to the Contracting Officer all data, 
drawings, specifications, reports, estimates, summaries, and other 
information and materials accumulated in performing this contract, 
whether completed or in process.
    (b) If the termination is for the convenience of the Government, the 
Contracting Officer shall make an equitable adjustment in the contract 
price but shall allow no anticipated profit on unperformed services.
    (c) If the termination is for failure of the Contractor to fulfill 
the contract obligations, the Government may complete the work by 
contract or otherwise and the Contractor shall be liable for any 
additional cost incurred by the Government.
    (d) If, after termination for failure to fulfill contract 
obligations, it is determined that the Contractor had not failed, the 
rights and obligations of the parties shall be the same as if the 
termination had been issued for the convenience of the Government.
    (e) The rights and remedies of the Government provided in this 
clause are in addition to any other rights and remedies provided by law 
or under this contract.

[[Page 387]]

                             (End of clause)



Sec.  52.249-8  Default (Fixed-Price Supply and Service).

    As prescribed in 49.504(a)(1), insert the following clause:

           Default (Fixed-Price Supply and Service) (APR 1984)

    (a)(1) The Government may, subject to paragraphs (c) and (d) below, 
by written notice of default to the Contractor, terminate this contract 
in whole or in part if the Contractor fails to--
    (i) Deliver the supplies or to perform the services within the time 
specified in this contract or any extension;
    (ii) Make progress, so as to endanger performance of this contract 
(but see subparagraph (a)(2) below); or
    (iii) Perform any of the other provisions of this contract (but see 
subparagraph (a)(2) below).
    (2) The Government's right to terminate this contract under 
subdivisions (1)(ii) and (1)(iii) above, may be exercised if the 
Contractor does not cure such failure within 10 days (or more if 
authorized in writing by the Contracting Officer) after receipt of the 
notice from the Contracting Officer specifying the failure.
    (b) If the Government terminates this contract in whole or in part, 
it may acquire, under the terms and in the manner the Contracting 
Officer considers appropriate, supplies or services similar to those 
terminated, and the Contractor will be liable to the Government for any 
excess costs for those supplies or services. However, the Contractor 
shall continue the work not terminated.
    (c) Except for defaults of subcontractors at any tier, the 
Contractor shall not be liable for any excess costs if the failure to 
perform the contract arises from causes beyond the control and without 
the fault or negligence of the Contractor. Examples of such causes 
include (1) acts of God or of the public enemy, (2) acts of the 
Government in either its sovereign or contractual capacity, (3) fires, 
(4) floods, (5) epidemics, (6) quarantine restrictions (7) strikes, (8) 
freight embargoes, and (9) unusually severe weather. In each instance 
the failure to perform must be beyond the control and without the fault 
or negligence of the Contractor.
    (d) If the failure to perform is caused by the default of a 
subcontractor at any tier, and if the cause of the default is 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 subcontracted supplies 
or services were obtainable from other sources in sufficient time for 
the Contractor to meet the required delivery schedule.
    (e) If this contract is terminated for default, the Government may 
require the Contractor to transfer title and deliver to the Government, 
as directed by the Contracting Officer, any (1) completed supplies, and 
(2) partially completed supplies and materials, parts, tools, dies, 
jigs, fixtures, plans, drawings, information, and contract rights 
(collectively referred to as manufacturing materials in this clause) 
that the Contractor has specifically produced or acquired for the 
terminated portion of this contract. Upon direction of the Contracting 
Officer, the Contractor shall also protect and preserve property in its 
possession in which the Government has an interest.
    (f) The Government shall pay contract price for completed supplies 
delivered and accepted. The Contractor and Contracting Officer shall 
agree on the amount of payment for manufacturing materials delivered and 
accepted and for the protection and preservation of the property. 
Failure to agree will be a dispute under the Disputes clause. The 
Government may withhold from these amounts any sum the Contracting 
Officer determines to be necessary to protect the Government against 
loss because of outstanding liens or claims of former lien holders.
    (g) If, after termination, 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 termination had 
been issued for the convenience of the Government.
    (h) The rights and remedies of the Government in this clause are in 
addition to any other rights and remedies provided by law or under this 
contract.

                             (End of clause)

    Alternate I (APR 1984). If the contract is for transportation or 
transportation-related services, delete paragraph (f) of the basic 
clause, redesignate the remaining paragraphs accordingly, and substitute 
the following paragraphs (a) and (e) for paragraphs (a) and (e) of the 
basic clause:

    (a)(1) The Government may, subject to paragraphs (c) and (d) below, 
by written notice of default to the Contractor, terminate this contract 
in whole or in part if the Contractor fails to--
    (i) Pick up the commodities or to perform the services, including 
delivery services, within the time specified in this contract or any 
extension;
    (ii) Make progress, so as to endanger performance of this contract 
(but see subparagraph (a)(2) below); or
    (iii) Perform any of the other provisions of this contract (but see 
subparagraph (a)(2) below).

[[Page 388]]

    (2) The Government's right to terminate this contract under 
subdivisions (1)(ii) and (1)(iii) above, may be exercised if the 
Contractor does not cure such failure within 10 days (or more if 
authorized in writing by the Contracting Officer) after receipt of the 
notice from the Contracting Officer specifying the failure.
    (e) If this contract is terminated while the Contractor has 
possession of Government goods, the Contractor shall, upon direction of 
the Contracting Officer, protect and preserve the goods until 
surrendered to the Government or its agent. The Contractor and 
Contracting Officer shall agree on payment for the preservation and 
protection of goods. Failure to agree on an amount will be a dispute 
under the Disputes clause.

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34762, July 3, 1995]



Sec.  52.249-9  Default (Fixed-Price Research and Development).

    As prescribed in 49.504(b), insert the following clause:

        Default (Fixed-Price Research and Development) (APR 1984)

    (a)(1) The Government may, subject to paragraphs (c) and (d) below, 
by written Notice of Default to the Contractor, terminate this contract 
in whole or in part if the Contractor fails to--
    (i) Perform the work under the contract within the time specified in 
this contract or any extension;
    (ii) Prosecute the work so as to endanger performance of this 
contract (but see subparagraph (a)(2) below); or
    (iii) Perform any of the other provisions of this contract (but see 
subparagraph (a)(2) below).
    (2) The Government's right to terminate this contract under 
subdivisions (1)(ii) and (1)(iii) of this paragraph may be exercised if 
the Contractor does not cure such failure within 10 days (or more, if 
authorized in writing by the Contracting Officer) after receipt of the 
notice from the Contracting Officer specifying the failure.
    (b) If the Government terminates this contract in whole or in part, 
it may acquire, under the terms and in the manner the Contracting 
Officer considers appropriate, work similar to the work terminated, and 
the Contractor will be liable to the Government for any excess costs for 
the similar work. However, the Contractor shall continue the work not 
terminated.
    (c) Except for defaults of subcontractors at any tier, the 
Contractor shall not be liable for any excess costs if the failure to 
perform the contract arises from causes beyond the control and without 
the fault or negliqence of the Contractor. Examples of such causes 
include (1) acts of God or of the public enemy, (2) acts of the 
Government in either its sovereign or contractual capacity, (3) fires, 
(4) floods, (5) epidemics, (6) quarantine restrictions, (7) strikes, (8) 
freight embargoes, and (9) unusually severe weather. In each instance 
the failure to perform must be beyond the control and without the fault 
or negligence of the Contractor.
    (d) If the failure to perform is caused by the default of a 
subcontractor at any tier, and if the cause of the default is 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 subcontracted supplies 
or services were obtainable from other sources in sufficient time for 
the Contractor to meet the required delivery schedule or other 
performance requirements.
    (e) If this contract is terminated for default, the Government may 
require the Contractor to transfer title and deliver to the Government, 
as directed by the Contracting Officer, any (1) completed or partially 
completed work not previously delivered to, and accepted by, the 
Government and (2) other property, including contract rights, 
specifically produced or acquired for the terminated portion of this 
contract. Upon direction of the Contracting Officer, the Contractor 
shall also protect and preserve property in its possession in which the 
Government has an interest.
    (f) The Government shall pay the contract price, if separately 
stated, for completed work it has accepted and the amount agreed upon by 
the Contractor and the Contracting Officer for (1) completed work for 
which no separate price is stated, (2) partially completed work, (3) 
other property described above that it accepts, and (4) the protection 
and preservation of the property. Failure to agree will be a dispute 
under the Disputes clause. The Government may withhold from these 
amounts any sum the Contracting Officer determines to be necessary to 
protect the Government against loss from outstanding liens or claims of 
former lien holders.
    (g) If, after termination, 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 termination had 
been issued for the convenience of the Government.
    (h) The rights and remedies of the Government in this clause are in 
addition to any other rights and remedies provided by law or under this 
contract.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34762, July 3, 1995]

[[Page 389]]



Sec.  52.249-10  Default (Fixed-Price Construction).

    As prescribed in 49.504(c)(1), insert the following clause:

              Default (Fixed-Price Construction) (APR 1984)

    (a) If the Contractor refuses or fails to prosecute the work or any 
separable part, with the diligence that will insure its completion 
within the time specified in this contract including any extension, or 
fails to complete the work within this time, the Government may, by 
written notice to the Contractor, terminate the right to proceed with 
the work (or the separable part of the work) that has been delayed. In 
this event, the Government may take over the work and complete it by 
contract or otherwise, and may take possession of and use any materials, 
appliances, and plant on the work site necessary for completing the 
work. The Contractor and its sureties shall be liable for any damage to 
the Government resulting from the Contractor's refusal or failure to 
complete the work within the specified time, whether or not the 
Contractor's right to proceed with the work is terminated. This 
liability includes any increased costs incurred by the Government in 
completing the work.
    (b) The Contractor's right to proceed shall not be terminated nor 
the Contractor charged with damages under this clause, if--
    (1) The delay in completing the work arises from unforeseeable 
causes beyond the control and without the fault or negligence of the 
Contractor. Examples of such causes include (i) acts of God or of the 
public enemy, (ii) acts of the Government in either its sovereign or 
contractual capacity, (iii) acts of another Contractor in the 
performance of a contract with the Government, (iv) fires, (v) floods, 
(vi) epidemics, (vii) quarantine restrictions, (viii) strikes, (ix) 
freight embargoes, (x) unusually severe weather, or (xi) delays of 
subcontractors or suppliers at any tier arising from unforeseeable 
causes beyond the control and without the fault or negligence of both 
the Contractor and the subcontractors or suppliers; and
    (2) The Contractor, within 10 days from the beginning of any delay 
(unless extended by the Contracting Officer), notifies the Contracting 
Officer in writing of the causes of delay. The Contracting Officer shall 
ascertain the facts and the extent of delay. If, in the judgment of the 
Contracting Officer, the findings of fact warrant such action, the time 
for completing the work shall be extended. The findings of the 
Contracting Officer shall be final and conclusive on the parties, but 
subject to appeal under the Disputes clause.
    (c) If, after termination of the Contractor's right to proceed, it 
is determined that the Contractor was not in default, or that the delay 
was excusable, the rights and obligations of the parties will be the 
same as if the termination had been issued for the convenience of the 
Government.
    (d) The rights and remedies of the Government in this clause are in 
addition to any other rights and remedies provided by law or under this 
contract.

                             (End of clause)

    Alternate I (APR 1984). If the contract is for dismantling, 
demolition, or removal of improvements, substitute the following 
paragraph (a) for paragraph (a) of the basic clause:

    (a)(1) If the Contractor refuses or fails to prosecute the work, or 
any separable part, with the diligence that will insure its completion 
within the time specified in this contract, including any extension, or 
fails to complete the work within this time, the Government may, by 
written notice to the Contractor, terminate the right to proceed with 
the work or the part of the work that has been delayed. In this event, 
the Government may take over the work and complete it by contract or 
otherwise, and may take possession of and use any materials, appliances, 
and plant on the work site necessary for completing the work.
    (2) If title to property is vested in the Contractor under this 
contract, it shall revest in the Government regardless of any other 
clause of this contract, except for property that the Contractor has 
disposed of by bona fide sale or removed from the site.
    (3) The Contractor and its sureties shall be liable for any damage 
to the Government resulting from the Contractor's refusal or failure to 
complete the work within the specified time, whether or not the 
Contractor's right to proceed with the work is terminated. This 
liability includes any increased costs incurred by the Government in 
completing the work.

    Alternate II (APR 1984). If the contract is to be awarded during a 
period of national emergency, subparagraph (b)(1) below may be 
substituted for subparagraph (b)(1) of the basic clause:

    (1) The delay in completing the work arises from causes other than 
normal weather beyond the control and without the fault or negligence of 
the Contractor. Examples of such causes include (i) acts of God or of 
the public enemy, (ii) acts of the Government in either its sovereign or 
contractual capacity, (iii) acts of another Contractor in the 
performance of a contract with the Government, (iv) fires, (v) floods, 
(vi) epidemics, (vii) quarantine restrictions, (viii) strikes, (ix) 
freight embargoes, (x) unusually severe weather, or (xi) delays of 
subcontractors or

[[Page 390]]

suppliers at any tier arising from causes other than normal weather 
beyond the control and without the fault or negligence of both the 
Contractor and the subcontractors or suppliers; and

    Alternate III (APR 1984). If the contract is for dismantling, 
demolition, or removal of improvements and is to be awarded during a 
period of national emergency, substitute the following paragraph (a) for 
paragraph (a) of the basic clause. The following subparagraph (b)(1) may 
be substituted for subparagraph (b)(1) of the basic clause:

    (a)(1) If the Contractor refuses or fails to prosecute the work, or 
any separable part, with the diligence that will insure its completion 
within the time specified in this contract, including any extension, or 
fails to complete the work within this time, the Government may, by 
written notice to the Contractor, terminate the right to proceed with 
the work or the part of the work that has been delayed. In this event, 
the Government may take over the work and complete it by contract or 
otherwise, and may take possession of and use any materials, appliances, 
and plant on the work site necessary for completing the work.
    (2) If title to property is vested in the Contractor under this 
contract, it shall revest in the Government regardless of any other 
clause of this contract, except for property that the Contractor has 
disposed of by bona fide sale or removed from the site.
    (3) The Contractor and its sureties shall be liable for any damage 
to the Government resulting from the Contractor's refusal or failure to 
complete the work within the specified time, whether or not the 
Contractor's right to proceed with the work is terminated. This 
liability includes any increased costs incurred by the Government in 
completing the work.
    (b) The Contractor's right to proceed shall not be terminated nor 
the Contractor charged with damages under this this clause, if--
    (1) The delay in completing the work arises from causes other than 
normal weather beyond the control and without the fault or negligence of 
the Contractor. Examples of such causes include (i) acts of God or of 
the public enemy, (ii) acts of the Government in either its sovereign or 
contractual capacity, (iii) acts of another Contractor in the 
performance of a contract with the Government, (iv) fires, (v) floods, 
(vi) epidemics, (vii) quarantine restrictions, (viii) strikes, (ix) 
freight embargoes, (x) unusually severe weather, or (xi) delays of 
subcontractors or suppliers at any tier arising from causes other than 
normal weather beyond the control and without the fault or negligence of 
both the Contractor and the subcontractors or suppliers; and

[48 FR 42478, Sept. 19, 1983, as amended at 60 FR 34762, July 3, 1995]



Sec.  52.249-11  Termination of Work (Consolidated Facilities or Facilities 
Acquisition).

    As prescribed in 49.505(a), insert the following clause:

Termination of Work (Consolidated Facilities or Facilities Acquisition) 
                               (SEP 1996)

    (a) The Government may terminate performance of work under this 
contract in whole, or from time to time, in part if the Contracting 
Officer determines that a termination is in the Government's interest. 
The Contracting Officer shall terminate by delivering to the Contractor 
a Notice of Termination specifying the extent of termination and the 
effective date.
    (b) After receipt of a Notice of Termination, and except as directed 
by the Contracting Officer, the Contractor shall immediately proceed 
with the following obligations regardless of any delay in determining 
any item of reimbursable cost under this clause:
    (1) Stop work as specified in the notice.
    (2) Place no further subcontracts or orders (referred to as 
subcontracts in this clause) for materials, services, or facilities, 
except as necessary to complete the continued portion of the contract.
    (3) Terminate all subcontracts to the extent they relate to the work 
terminated.
    (4) Assign to the Government, as directed by the Contracting 
Officer, all right, title, and interest of the Contractor under the 
subcontracts terminated, in which case the Government shall have the 
right to settle or pay any termination settlement proposal arising out 
of those terminations.
    (5) With the approval or ratification to the extent required by the 
Contracting Officer, settle all outstanding liabilities and termination 
settlement proposals arising from the termination of subcontracts, the 
cost of which would be reimbursable in whole or in part under this 
contract; the approval or ratification will be final for purposes of 
this clause.
    (6) Transfer title (if not already transferred) and, as directed by 
the Contracting Officer, deliver to the Government (i) the fabricated or 
unfabricated parts, work in process, completed work, supplies, and other 
material produced or acquired for the work terminated, and (ii) the 
completed or partially completed plans, drawings, information, and other 
property that, if the contract had been completed, would be required to 
be furnished to the Government.

[[Page 391]]

    (7) Complete performance of the work not terminated.
    (8) Take any action that may be necessary, or that the Contracting 
Officer may direct, for the protection and preservation of the property 
related to this contract that is in the possession of the Contractor and 
in which the Government has or may acquire an interest.
    (9) Use its best efforts to sell, as directed or authorized by the 
Contracting Officer, any property of the types referred to in 
subparagraph (b)(6) of this clause; provided, however, that the 
Contractor (i) is not required to extend credit to any purchaser and 
(ii) may acquire the property under the conditions prescribed by, and at 
prices approved by, the Contracting Officer. The proceeds of any 
transfer or disposition will be applied to reduce any payments to be 
made by the Government under this contract, credited to the price or 
cost of the work, or paid in any other manner directed by the 
Contracting Officer.
    (c) The Contractor shall submit complete termination inventory 
schedules no later than 120 days from the effective date of termination, 
unless extended in writing by the Contracting Officer upon written 
request of the Contractor within this 120-day period.
    (d) After expiration of the plant clearance period as defined in 
subpart 45.6 of the Federal Acquisition Regulation, the Contractor may 
submit a list, to the Contracting Officer certified as to quantity and 
quality, of termination inventory not previously disposed of, excluding 
items authorized for disposition by the Contracting Officer. The 
Contractor may request the Government to remove these items or enter 
into an agreement for their storage. Within 15 days, the Government 
shall accept the items and remove them or enter into a storage 
agreement. The Contracting Officer may verify the list upon removal of 
the items or, if stored, within 45 days from submission of the list, and 
shall correct the list, as necessary, before final settlement.
    (e) After termination, the Contractor shall submit a final 
termination settlement proposal to the Contracting Officer in the form 
and with the certification prescribed by the Contracting Officer. The 
Contractor shall submit the proposal promptly, but no later than 1 year 
from the effective date of termination, unless extended in writing by 
the Contracting Officer upon written request of the Contractor within 
this 1-year period. However, if the Contracting Officer determines that 
the facts justify it, a termination settlement proposal may be received 
and acted on after 1 year or any extension. If the Contractor fails to 
submit the proposal within the time allowed, the Contracting Officer may 
determine, on the basis of information available, the amount, if any, 
due the Contractor because of the termination and shall pay that amount.
    (f) Subject to paragraph (e) of this clause, the Contractor and the 
Contracting Officer may agree on the whole or any part of the amount to 
be paid because of the termination. The contract shall be amended, and 
the Contractor paid the agreed amount.
    (g) If the Contractor and the Contracting Officer fail to agree on 
the whole amount of costs to be paid because of the termination of work, 
the Contracting Officer shall determine, on the basis of information 
available, the amount, if any, due the Contractor, and shall pay the 
amount, determined as follows:
    (1) All costs reimbursable under this contract, not previously paid, 
for the performance of this contract before the effective date of the 
termination, and part of those costs that may continue for a reasonable 
time with the approval of or as directed by the Contracting Officer; 
however, the Contractor shall discontinue those costs as rapidly as 
practicable.
    (2) The cost of settling and paying termination settlement proposals 
under terminated subcontracts that are properly chargeable to the 
terminated portion of the contract, if not included in subparagraph 
(g)(1) of this clause.
    (3) The reasonable costs of settlement of the work terminated, 
including--
    (i) Accounting, legal, clerical, and other expenses reasonably 
necessary for the preparation of termination settlement proposals and 
supporting data;
    (ii) The termination and settlement of subcontracts; and
    (iii) Storage, transportation, and other costs incurred, reasonably 
necessary for the preservation, protection, or disposition of the 
termination inventory.
    (h) The cost principles and procedures in part 31 of the Federal 
Acquisition Regulation, in effect on the date of this contract, shall 
govern all costs claimed, agreed to, or determined under this clause.
    (i) The Contractor shall have the right of appeal, under the 
Disputes clause, from any determination made by the Contracting Officer 
under paragraph (e) or (g) of this clause, except that if the Contractor 
failed to submit the termination settlement proposal within the time 
provided in paragraph (e) of this clause, and failed to request a time 
extension, there is no right of appeal. If the Contracting Officer has 
made a determination of the amount due under paragraph (e) or (g) of 
this clause, the Government shall pay the Contractor (1) the amount 
determined by the Contracting Officer if there is no right of appeal or 
if no timely appeal has been taken, or (2) the amount finally determined 
on an appeal.
    (j) In arriving at the amount due the Contractor under this clause, 
there shall be deducted--

[[Page 392]]

    (1) All unliquidated advance or other payments to the Contractor, 
under the terminated portion of this contract;
    (2) Any claim which the Government has against the Contractor under 
this contract; and
    (3) The agreed price for, or the proceeds of sale of materials, 
supplies, or other things acquired by the Contractor or sold under this 
clause and not recovered by or credited to the Government.
    (k)(1) The Government may, under the terms and conditions it 
prescribes, make partial payments and payments against costs incurred by 
the Contractor for the terminated portion of the contract, if the 
Contracting Officer believes the total of these payments will not exceed 
the amount to which the Contractor will be entitled.
    (2) If the total payments exceed the amount finally determined to be 
due, the Contractor shall repay the excess to the Government upon 
demand, together with interest computed at the rate established by the 
Secretary of the Treasury under 50 U.S.C. App. 1215(b)(2). Interest 
shall be computed for the period from the date the excess payment is 
received by the Contractor to the date the excess is repaid. Interest 
shall not be charged on any excess payment due to a reduction in the 
Contractor's termination settlement proposal because of retention or 
other disposition of termination inventory until 10 days after the date 
of the retention or disposition, or a later date determined by the 
Contracting Officer because of the circumstances.
    (l) Any related contract of the Contractor may be equitably adjusted 
if it provides for such an adjustment and if it is affected by a Notice 
of Termination under this clause. The Government shall not be liable to 
the Contractor for damages or loss of profits because of any Notice of 
Termination issued under this clause.

                             (End of clause)

    Alternate I (SEP 1996). If the contract is with an agency of the 
U.S. Government or with State, local, or foreign governments or their 
agencies, and if the contracting officer determines that the requirement 
to pay interest on excess partial payments is inappropriate, delete 
subparagraph (k)(2) from the basic clause.

[48 FR 42478, Sept. 19, 1983, as amended at 61 FR 39224, July 26, 1996]



Sec.  52.249-12  Termination (Personal Services).

    As prescribed in 49.505(b), insert the following clause in 
solicitations and contracts for personal services (see part 37):

               Termination (Personal Services) (APR 1984)

    The Government may terminate this contract at any time upon at least 
15 days' written notice by the Contracting Officer to the Contractor. 
The Contractor, with the written consent of the Contracting Officer, may 
terminate this contract upon at least 15 days' written notice to the 
Contracting Officer.

                             (End of clause)



Sec.  52.249-13  Failure to Perform.

    As prescribed in 49.505(c), insert the following clause in 
facilities contracts except facilities use contracts with nonprofit 
educational institutions:

                      Failure to Perform (APR 1984)

    (a) Subject to the Excusable Delays clause (if included in this 
contract), if the Contractor fails to perform this contract under its 
terms, the Contracting Officer shall give the Contractor written notice 
stating the failure. Thereafter, regardless of any other provision of 
this contract, the Contractor shall not be entitled to an equitable 
adjustment under either this contract or any related contract, to the 
extent the equitable adjustment arises from the Contractor's failure to 
perform or from any reasonable remedial action taken by the Contracting 
Officer based upon the failure.
    (b) The failure of the Government to insist, in one or more 
instances, upon the performance of any term of this contract is not a 
waiver of the Government's right to future performance of such term, and 
the Contractor's obligation for future performance of such term shall 
continue in effect.
    (c) The rights and remedies of the Government in this clause are in 
addition to any other rights and remedies provided by law or under this 
contract.

                             (End of clause)



Sec.  52.249-14  Excusable Delays.

    As prescribed in 49.505(d), insert the following clause in 
solicitations and contracts for supplies, services, construction, and 
research and development on a fee basis whenever a cost-reimbursement 
contract is contemplated. Also insert the clause in time-and-material 
contracts, labor-hour contracts, consolidated facilities contracts, and 
facilities acquisition contracts. When

[[Page 393]]

used in construction contracts, substitute the words completion time for 
delivery schedule in the last sentence of the clause. When used in 
facilities contracts, substitute the words termination of work for 
termination in the last sentence of the clause.

                       Excusable Delays (APR 1984)

    (a) Except for defaults of subcontractors at any tier, the 
Contractor shall not be in default because of any failure to perform 
this contract under its terms if the failure arises from causes beyond 
the control and without the fault or negligence of the Contractor. 
Examples of these causes are (1) acts of God or of the public enemy, (2) 
acts of the Government in either its sovereign or contractual capacity, 
(3) fires, (4) floods, (5) epidemics, (6) quarantine restrictions, (7) 
strikes, (8) freight embargoes, and (9) unusually severe weather. In 
each instance, the failure to perform must be beyond the control and 
without the fault or negligence of the Contractor. Default includes 
failure to make progress in the work so as to endanger performance.
    (b) If the failure to perform is caused by the failure of a 
subcontractor at any tier to perform or make progress, and if the cause 
of the failure was beyond the control of both the Contractor and 
subcontractor, and without the fault or negligence of either, the 
Contractor shall not be deemed to be in default, unless--
    (1) The subcontracted supplies or services were obtainable from 
other sources;
    (2) The Contracting Officer ordered the Contractor in writing to 
purchase these supplies or services from the other source; and
    (3) The Contractor failed to comply reasonably with this order.
    (c) Upon request of the Contractor, the Contracting Officer shall 
ascertain the facts and extent of the failure. If the Contracting 
Officer determines that any failure to perform results from one or more 
of the causes above, the delivery schedule shall be revised, subject to 
the rights of the Government under the termination clause of this 
contract.

                             (End of clause)



Sec.  52.250-1  Indemnification Under Public Law 85-804.

    As prescribed in 50.403-3, insert the following clause in contracts 
whenever the approving official determines that the contractor shall be 
indemnified against unusually hazardous or nuclear risks (also see 
50.403-2(c)):

           Indemnification Under Public Law 85-804 (APR 1984)

    (a) Contractor's principal officials, as used in this clause, means 
directors, officers, managers, superintendents, or other representatives 
supervising or directing--
    (1) All or substantially all of the Contractor's business;
    (2) All or substantially all of the Contractor's operations at any 
one plant or separate location in which this contract is being 
performed; or
    (3) A separate and complete major industrial operation in connection 
with the performance of this contract.
    (b) Under Pub. L. 85-804 (50 U.S.C 1431-1435) and Executive Order 
10789, as amended, and regardless of any other provisions of this 
contract, the Government shall, subject to the limitations contained in 
the other paragraphs of this clause, indemnify the Contractor against--
    (1) Claims (including reasonable expenses of litigation or 
settlement) by third persons (including employees of the Contractor) for 
death; personal injury; or loss of, damage to, or loss of use of 
property;
    (2) Loss of, damage to, or loss of use of Contractor property, 
excluding loss of profit; and
    (3) Loss of, damage to, or loss of use of Government property, 
excluding loss of profit.
    (c) This indemnification applies only to the extent that the claim, 
loss, or damage (1) arises out of or results from a risk defined in this 
contract as unusually hazardous or nuclear and (2) is not compensated 
for by insurance or otherwise. Any such claim, loss, or damage, to the 
extent that it is within the deductible amounts of the Contractor's 
insurance, is not covered under this clause. If insurance coverage or 
other financial protection in effect on the date the approving official 
authorizes use of this clause is reduced, the Government's liability 
under this clause shall not increase as a result.
    (d) When the claim, loss, or damage is caused by willful misconduct 
or lack of good faith on the part of any of the Contractor's principal 
officials, the Contractor shall not be indemnified for--
    (1) Government claims against the Contractor (other than those 
arising through subrogation); or
    (2) Loss or damage affecting the Contractor's property.
    (e) With the Contracting Officer's prior written approval, the 
Contractor may, in any subcontract under this contract, indemnify the 
subcontractor against any risk defined in this contract as unusually 
hazardous or nuclear. This indemnification shall provide, between the 
Contractor and the subcontractor, the same rights and duties, and the

[[Page 394]]

same provisions for notice, furnishing of evidence or proof, and 
Government settlement or defense of claims as this clause provides. The 
Contracting Officer may also approve indemnification of subcontractors 
at any lower tier, under the same terms and conditions. The Government 
shall indemnify the Contractor against liability to subcontractors 
incurred under subcontract provisions approved by the Contracting 
Officer.
    (f) The rights and obligations of the parties under this clause 
shall survive this contract's termination, expiration, or completion. 
The Government shall make no payment under this clause unless the agency 
head determines that the amount is just and reasonable. The Government 
may pay the Contractor or subcontractors, or may directly pay parties to 
whom the Contractor or subcontractors may be liable.
    (g) The Contractor shall--
    (1) Promptly notify the Contracting Officer of any claim or action 
against, or any loss by, the Contractor or any subcontractors that may 
reasonably be expected to involve indemnification under this clause;
    (2) Immediately furnish to the Government copies of all pertinent 
papers the Contractor receives;
    (3) Furnish evidence or proof of any claim, loss, or damage covered 
by this clause in the manner and form the Government requires; and
    (4) Comply with the Government's directions and execute any 
authorizations required in connection with settlement or defense of 
claims or actions.
    (h) The Government may direct, control, or assist in settling or 
defending any claim or action that may involve indemnification under 
this clause.

                             (End of clause)

    Alternate I (APR 1984). In cost-reimbursement contracts, add the 
following paragraph (i) to the basic clause:

    (i) The cost of insurance (including self-insurance programs) 
covering a risk defined in this contract as unusually hazardous or 
nuclear shall not be reimbursed except to the extent that the 
Contracting Officer has required or approved this insurance. The 
Government's obligations under this clause are--
    (1) Excepted from the release required under this contract's clause 
relating to allowable cost; and
    (2) Not affected by this contract's Limitation of Cost or Limitation 
of Funds clause.



Sec.  52.251-1  Government Supply Sources.

    As prescribed in 51.107, insert the following clause in 
solicitations and contracts when the contracting officer may authorize 
the contractor to acquire supplies or services from a Government supply 
source:

                  Government Supply Sources (APR 1984)

    The Contracting Officer may issue the Contractor an authorization to 
use Government supply sources in the performance of this contract. Title 
to all property acquired by the Contractor under such an authorization 
shall vest in the Government unless otherwise specified in the contract. 
Such property shall not be considered to be Government-furnished 
property, as distinguished from Government property. The provisions of 
the clause entitled Government Property, except its paragraphs (a) and 
(b), shall apply to all property acquired under such authorization.

                             (End of clause)

    Alternate I (APR 1984) If a facilities contract is contemplated, 
delete the last sentence from the basic clause.



Sec.  52.251-2  Interagency Fleet Management System Vehicles and Related Services.

    As prescribed in 51.205, insert the following clause:

 Interagency Fleet Management System Vehicles and Related Services (JAN 
                                  1991)

    The Contracting Officer may issue the Contractor an authorization to 
obtain interagency fleet management system vehicles and related services 
for use in the performance of this contract. The use, service, and 
maintenance of interagency fleet management system vehicles and the use 
of related services by the Contractor shall be in accordance with 41 CFR 
101-39 and 41 CFR 101-38.301-1.

                             (End of clause)

[48 FR 42478, Sept. 19, 1983, as amended at 54 FR 29284, July 11, 1989; 
55 FR 52800, Dec. 21, 1990]



Sec.  52.252-1  Solicitation Provisions Incorporated by Reference.

    As prescribed in 52.107(a), insert the following provision:

      Solicitation Provisions Incorporated by Reference (FEB 1998)

    This solicitation incorporates one or more solicitation provisions 
by reference, with the same force and effect as if they were given in 
full text. Upon request, the Contracting Officer will make their full 
text available. The offeror is cautioned that the listed provisions may 
include blocks that must be completed by the offeror and submitted with 
its

[[Page 395]]

quotation or offer. In lieu of submitting the full text of those 
provisions, the offeror may identify the provision by paragraph 
identifier and provide the appropriate information with its quotation or 
offer. Also, the full text of a solicitation provision may be accessed 
electronically at this/these address(es):

________________________________________________________________________

________________________________________________________________________

[Insert one or more Internet addresses]

                           (End of provision)

[62 FR 64928, Dec. 9, 1997]



Sec.  52.252-2  Clauses Incorporated by Reference.

    As prescribed in 52.107(b), insert the following clause:

              Clauses Incorporated by Reference (FEB 1998)

    This contract incorporates one or more clauses by reference, with 
the same force and effect as if they were given in full text. Upon 
request, the Contracting Officer will make their full text available. 
Also, the full text of a clause may be accessed electronically at this/
these address(es):

________________________________________________________________________

________________________________________________________________________

[Insert one or more Internet addresses]

                             (End of clause)

[62 FR 64929, Dec. 9, 1997]



Sec.  52.252-3  Alterations in Solicitation.

    As prescribed in 52.107(c), insert the following provision in 
solicitations in order to revise or supplement, as necessary, other 
parts of the solicitation that apply to the solicitation phase only, 
except for any provision authorized for use with a deviation. Include 
clear identification of what is being altered.

                 Alterations in Solicitation (APR 1984)

    Portions of this solicitation are altered as follows:

                           (End of provision)



Sec.  52.252-4  Alterations in Contract.

    As prescribed in 52.107(d), insert the following clause in 
solicitations and contracts in order to revise or supplement, as 
necessary, other parts of the contract, or parts of the solicitation 
that apply after contract award, except for any clause authorized for 
use with a deviation. Include clear identification of what is being 
altered.

                   Alterations in Contract (APR 1984)

    Portions of this contract are altered as follows:

                             (End of clause)



Sec.  52.252-5  Authorized Deviations in Provisions.

    As prescribed in 52.107(e), insert the following provision in 
solicitations that include any FAR or supplemental provision with an 
authorized deviation. Whenever any FAR or supplemental provision is used 
with an authorized deviation, the contracting officer shall identify it 
by the same number, title, and date assigned to the provision when it is 
used without deviation, include regulation name for any supplemental 
provision, except that the contracting officer shall insert (DEVIATION) 
after the date of the provision.

             Authorized Deviations in Provisions (APR 1984)

    (a) The use in this solicitation of any Federal Acquisition 
Regulation (48 CFR chapter 1) provision with an authorized deviation is 
indicated by the addition of (DEVIATION) after the date of the 
provision.
    (b) The use in this solicitation of any ---- [insert regulation 
name] (48 CFR chapter --) provision with an authorized deviation is 
indicated by the addition of (DEVIATION) after the name of the 
regulation.

                           (End of provision)



Sec.  52.252-6  Authorized Deviations in Clauses.

    As prescribed in 52.107(f), insert the following clause in 
solicitations and contracts that include any FAR or supplemental clause 
with an authorized deviation. Whenever any FAR or supplemental clause is 
used with an authorized deviation, the contracting officer shall 
identify it by the same number, title, and date assigned to the clause 
when it is used without deviation, include regulation name for any 
supplemental clause, except that the contracting officer shall insert 
(DEVIATION) after the date of the clause.

[[Page 396]]

               Authorized Deviations in Clauses (APR 1984)

    (a) The use in this solicitation or contract of any Federal 
Acquisition Regulation (48 CFR Chapter 1) clause with an authorized 
deviation is indicated by the addition of (DEVIATION) after the date of 
the clause.
    (b) The use in this solicitation or contract of any ---- [insert 
regulation name] (48 CFR --) clause with an authorized deviation is 
indicated by the addition of (DEVIATION) after the name of the 
regulation.

                             (End of clause)



Sec.  52.253-1  Computer Generated Forms.

    As prescribed in FAR 53.111, insert the following clause:

                   Computer Generated Forms (JAN 1991)

    (a) Any data required to be submitted on a Standard or Optional Form 
prescribed by the Federal Acquisition Regulation (FAR) may be submitted 
on a computer generated version of the form, provided there is no change 
to the name, content, or sequence of the data elements on the form, and 
provided the form carries the Standard or Optional Form number and 
edition date.
    (b) Unless prohibited by agency regulations, any data required to be 
submitted on an agency unique form prescribed by an agency supplement to 
the FAR may be submitted on a computer generated version of the form 
provided there is no change to the name, content, or sequence of the 
data elements on the form and provided the form carries the agency form 
number and edition date.
    (c) If the Contractor submits a computer generated version of a form 
that is different than the required form, then the rights and 
obligations of the parties will be determined based on the content of 
the required form.

                             (End of clause)

[55 FR 52800, Dec. 21, 1990]



                Subpart 52.3_Provision and Clause Matrix



Sec.  52.300  Scope of subpart.

    The matrix in this subpart contains a column for each principal type 
and/or purpose of contract (see 52.101(e)).

[55 FR 3890, Feb. 5, 1990]



Sec.  52.301  Solicitation provisions and contract clauses (Matrix).

    Note: The FAR matrix is not carried in the CFR. It is available in 
the loose-leaf edition.

[48 FR 42478, Sept. 19, 1983, as amended at 62 FR 40239, July 25, 1997]



PART 53_FORMS--Table of Contents




Sec.
53.000 Scope of part.
53.001 Definitions.

                          Subpart 53.1_General

53.100 Scope of subpart.
53.101 Requirements for use of forms.
53.102 Current editions.
53.103 Exceptions.
53.104 Overprinting.
53.105 Computer generation.
53.106 Special construction and printing.
53.107 Obtaining forms.
53.108 Recommendations concerning forms.
53.109 Forms prescribed by other regulations.
53.110 Continuation sheets.
53.111 Contract clause.

                   Subpart 53.2_Prescription of Forms

53.200 Scope of subpart.
53.201 Federal acquisition system.
53.201-1 Contracting authority and responsibilities (SF 1402).
53.202-53.203 [Reserved]
53.204 Administrative matters.
53.204-1 Safeguarding classified information within industry (DD Form 
          254, DD Form 441).
53.204-2 Contract reporting.
53.205 Publicizing contract actions.
53.205-1 Paid advertisements.
53.206-53.208 [Reserved]
53.209 Contractor qualifications.
53.209-1 Responsible prospective contractors.
53.210-53.211 [Reserved]
53.212 Acquisition of commercial items.
53.213 Simplified acquisition procedures (SF's 18, 30, 44, 1165, and 
          1449, and OF's 336, 347, and 348).
53.214 Sealed bidding.
53.215 Contracting by negotiation.
53.215-1 Solicitation and receipt of proposals.
53.216 Types of contracts.
53.216-1 Delivery orders and orders under basic ordering agreements (OF 
          347).
53.217-53.218 [Reserved]
53.219 Small business programs.
53.220-53.221 [Reserved]

[[Page 397]]

53.222 Application of labor laws to Government acquisitions (SF's 99, 
          308, 1093, 1413, 1444, 1445, 1446, WH-347).
53.223-53.227 [Reserved]
53.228 Bonds and insurance.
53.229 Taxes (SF's 1094, 1094-A).
53.230-53.231 [Reserved]
53.232 Contract financing (SF 1443).
53.233-53.234 [Reserved]
53.235 Research and Development Contracting (SF 298).
53.236 Construction and architect-engineer contracts.
53.236-1 Construction.
53.236-2 Architect-engineer services (SF's 252, 254, 255, 1421).
53.237-53.241 [Reserved]
53.242 Contract administration.
53.242-1 Novation and change-of-name agreements (SF 30).
53.243 Contract modifications (SF 30).
53.244 [Reserved]
53.245 Government property.
53.246 [Reserved]
53.247 Transportation (U.S. Government Bill of Lading).
53.248 [Reserved]
53.249 Termination of contracts.
53.250 [Reserved]
53.251 Contractor use of Government supply sources (OF 347).

                   Subpart 53.3_Illustrations of Forms

53.300 Scope of subpart.
53.301 Standard forms.
53.301-18 SF 18 (Rev. 6/95), Request for Quotations.
53.301-24 Bid Bond.
53.301-25 Performance Bond.
53.301-25-A Payment Bond.
53.301-25-B Standard Form 25-B, Continuation Sheet (For Standard Forms 
          24, 25, and 25-A).
53.301-26 Standard Form 26, Award/Contract.
53.301-28 Affidavit of Individual Surety.
53.301-30 Standard Form 30, Amendment of Solicitation/Modification of 
          Contract.
53.301-33 Solicitation, Offer and Award.
53.301-34 Annual Bid Bond.
53.301-35 Annual Performance Bond.
53.301-44 Standard Form 44, Purchase Order--Invoice--Voucher.
53.301-98 Standard Form 98, Notice of Intention to Make a Service 
          Contract and Response to Notice.
53.301-98a Standard Form 98a, Notice of Intention to Make a Service 
          Contract and Response to Notice (Attachment A).
53.301-99 Standard Form 99, Notice of Award of Contract.
53.301-120 Standard Form 120, Report of Excess Personal Property.
53.301-120-A Standard Form 120-A, Continuation Sheet (Report of Excess 
          Personal Property).
53.301-126 Standard Form 126, Report of Personal Property for Sale.
53.301-126-A Standard Form 126-A, Report of Personal Property for Sale 
          (Continuation Sheet).
53.301-252 Standard Form 252, Architect-Engineer Contract.
53.301-254 Standard Form 254, Architect-Engineer and Related Services 
          Questionnaire.
53.301-255 Standard Form 255, Architect-Engineer and Related Services 
          Questionnaire for Specific Project.
53.301-273 Reinsurance Agreement for a Miller Act Performance Bond.
53.301-274 Reinsurance Agreement for a Miller Act Payment Bond.
53.301-275 Reinsurance Agreement in Favor of the United States.
53.301-279 Federal Procurement Data System (FPDS) Individual Contract 
          Action Report.
53.301-281 Federal Procurement Data System (FPDS) Summary Contract 
          Action Report ($25,000 or Less).
53.301-294 Subcontracting Report for Individual Contracts.
53.301-295 Summary Subcontract Report.
53.301-298 Standard Form 298, Report Documentation Page.
53.301-308 Standard Form 308, Request for Determination and Response to 
          Request.
53.301-1034 Standard Form 1034, Public Voucher for Purchases and 
          Services Other Than Personal.
53.301-1034A Standard Form 1034A, Public Voucher for Purchases and 
          Services Other Than Personal--Memorandum Copy.
53.301-1035 Standard Form 1035, Public Voucher for Purchases and 
          Services Other Than Personal, Continuation Sheet.
53.301-1035A Standard Form 1035A, Public Voucher for Purchases and 
          Services Other Than Personal--Memorandum, Continuation Sheet.
53.301-1093 Standard Form 1093, Schedule of Withholdings Under the 
          Davis-Bacon Act and/or the Contract Work Hours and Safety 
          Standards Act.
53.301-1094 SF 1094, U.S. Tax Exemption Certificates.
53.301-1094A SF 1094A, Tax Exemption Certificates Accountability Record.
53.301-1165 Standard Form 1165, Receipt for Cash-Subvoucher.
53.301-1402 Standard Form 1402, Certificate of Appointment.
53.301-1403 Preaward Survey of Prospective Contractor (General).
53.301-1404 Preaward Survey of Prospective Contractor--Technical.
53.301-1405 Preaward Survey of Prospective Contractor--Production.
53.301-1406 Preaward Survey of Prospective Contractor--Quality 
          Assurance.

[[Page 398]]

53.301-1407 Preaward Survey of Prospective Contractor--Financial 
          Capability.
53.301-1408 Preaward Survey of Prospective Contractor--Accounting 
          System.
53.301-1409 Standard Form 1409, Abstract of Offers.
53.301-1410 Standard Form 1410, Abstract of Offers--Continuation.
53.301-1413 Standard Form 1413, Statement and Acknowledgment.
53.301-1414 SF 1414 (Rev. 10/93) Consent of Surety.
53.301-1415 SF 1415 (Rev. 7/93) Consent of Surety and Increase of 
          Penalty.
53.301-1416 Payment Bond for Other than Construction Contracts.
53.301-1417 Pre-Solicitation Notice.
53.301-1418 Performance bond for other than construction contracts.
53.301-1420 Standard Form 1420, Performance Evaluation--Construction 
          Contracts.
53.301-1421 Standard Form 1421, Performance Evaluation (Architect-
          Engineer).
53.301-1423 SF 1423, Inventory Verification Survey.
53.301-1424 Standard Form 1424, Inventory Disposal Report.
53.301-1426 SF 1426, Inventory Schedule A (Metals in Mill Product Form).
53.301-1427 Standard Form 1427, Inventory Schedule A--Construction Sheet 
          (Metals in Mill Product Form).
53.301-1428 SF 1428, Inventory Schedule B.
53.301-1429 Standard Form 1429, Inventory Schedule B--Continuation 
          Sheet.
53.301-1430 SF 1430, Inventory Schedule C (Work-in-Process).
53.301-1431 Inventory Schedule C--Continuation Sheet (Work-in-Process).
53.301-1432 SF 1432, Inventory Schedule D (Special Tooling and Special 
          Test Equipment).
53.301-1433 Inventory Schedule D--Continuation Sheet (Special Tooling 
          and Special Test Equipment).
53.301-1434 SF 1434, Termination Inventory Schedule E (Short Form For 
          Use With SF 1438 Only).
53.301-1435 Settlement Proposal (Inventory Basis).
53.301-1436 Settlement Proposal (Total Cost Basis).
53.301-1437 Settlement Proposal for Cost-Reimbursement Type Contracts.
53.301-1438 Settlement Proposal (Short Form).
53.301-1439 Schedule of Accounting Information.
53.301-1440 Application for Partial Payment.
53.301-1442 Standard Form 1442, Solicitation, Offer and Award 
          (Construction, Alteration, or Repair).
53.301-1443 Standard Form 1443, Contractor's Request for Progress 
          Payment.
53.301-1444 Request for Authorization of Additional Classification and 
          Rate.
53.301-1445 SF 1445, Labor Standards Interview.
53.301-1446 Labor Standards Investigation Summary Sheet.
53.301-1447 Solicitation/Contract.
53.301-1449 Solicitation/Contract/Order for Commercial Items.
53.302 Optional forms.
53.302-17 Optional Form 17, Offer Label.
53.302-90 Release of Lien on Real Property.
53.302-91 Release of Personal Property From Escrow.
53.302-307 Optional Form 307, Contract Award.
53.302-308 Optional Form 308, Solicitation and Offer--Negotiated 
          Acquisition.
53.302-309 Optional Form 309, Amendment of Solicitation.
53.302-312 Small Disadvantaged Business (SDB) Participation Report.
53.302-333 Procurement Integrity Certification for Procurement 
          Officials.
53.302-336 Optional Form 336, Continuation Sheet.
53.302-347 OF 347 (Rev. 6/95), Order for Supplies or Services.
53.302-348 Optional Form 348, Order for Supplies or Services Schedule--
          Continuation.
53.302-1419 Optional Form 1419, Abstract of Offers--Construction.
53.302-1419A Optional Form 1419A, Abstract of Offers--Construction, 
          Continuation Sheet.
53.303 Agency forms.
53.303-DD-254 Department of Defense DD Form 254, Contract Security 
          Classification Specification.
53.303-DD-441 Department of Defense DD Form 441, Security Agreement.
53.303-WH-347 Department of Labor Form WH-347, Payroll (For Contractor's 
          Optional Use).

    Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42 U.S.C. 
2473(c).

    Source: 48 FR 42637, Sept. 19, 1983, unless otherwise noted.



Sec.  53.000  Scope of part.

    This part (a) prescribes standard forms (SF's) and references 
optional forms (OF's) and agency-prescribed forms for use in 
acquisition, (b) contains requirements and information generally 
applicable to the forms, and (c) illustrates the forms.



Sec.  53.001  Definitions.

    Exception, as used in this part, means an approved departure from 
the established design, content, printing specifications, or conditions 
for use of any standard form.

[[Page 399]]



                          Subpart 53.1_General



Sec.  53.100  Scope of subpart.

    This subpart contains requirements and information generally 
applicable to the forms prescribed in this regulation.



Sec.  53.101  Requirements for use of forms.

    The requirements for use of the forms prescribed or referenced in 
this part are contained in parts 1 through 52, where the subject matter 
applicable to each form is addressed. The specific location of each 
requirement is identified in subpart 53.2.

[48 FR 42637, Sept. 19, 1983, as amended at 63 FR 34080, June 22, 1998]



Sec.  53.102  Current editions.

    The form prescriptions in subpart 53.2 and the illustrations in 
subpart 53.3 contain current edition dates. Contracting officers shall 
use the current editions unless otherwise authorized under this 
regulation.



Sec.  53.103  Exceptions.

    Agencies shall not (a) alter a standard form prescribed by this 
regulation, or (b) use for the same purpose any form other than the 
standard form prescribed by this regulation without receiving in advance 
an exception to the form.

[53 FR 43395, Oct. 26, 1988, as amended at 62 FR 40239, July 25, 1997]



Sec.  53.104  Overprinting.

    Standard and optional forms (obtained as required by 53.107) may be 
overprinted with names, addresses, and other uniform entries that are 
consistent with the purpose of the form and that do not alter the form 
in any way. Exception approval for overprinting is not needed.



Sec.  53.105  Computer generation.

    (a) Agencies may computer-generate the Standard and Optional Forms 
prescribed in the FAR without exception approval (see 53.103), 
provided--
    (1) The form is in an electronic format that complies with Federal 
Information Processing Standard Number 161; or
    (2) There is no change to the name, content, or sequence of the data 
elements, and the form carries the Standard or Optional Form number and 
edition date.
    (b) The forms prescribed by this part may be computer generated by 
the public. Unless prohibited by agency regulations, forms prescribed by 
agency FAR supplements may also be computer generated by the public. 
Computer generated forms shall either comply with Federal Information 
Processing Standard Number 161 or shall retain the name, content, or 
sequence of the data elements, and shall carry the Standard or Optional 
Form or agency number and edition date (see 53.111).

[60 FR 34741, July 3, 1995]



Sec.  53.106  Special construction and printing.

    Contracting offices may request exceptions (see 53.103) to standard 
forms for special construction and printing. Examples of common 
exceptions are as follows:

------------------------------------------------------------------------
           Standard Forms              Special Construction and Printing
------------------------------------------------------------------------
(a) SF 18--.........................  (1) With vertical lines omitted
                                       (for listing of supplies and
                                       services, unit, etc.);
                                      (2) As reproducible masters; and/
                                       or
                                      (3) In carbon interleaved pads or
                                       sets.
(b) SF's 26,30,33,1447--............  As die-cut stencils or
                                       reproducible masters.
(c) SF 44--.........................  (1) With serial numbers and
                                       contracting office name and
                                       address; and/or
                                      (2) On special weight of paper and
                                       with the type of construction,
                                       number of sets per book, and
                                       number of parts per set as
                                       specified by the contracting
                                       officer. (Executive agencies may
                                       supplement the administrative
                                       instructions on the inside front
                                       cover of the book.)
(d) SF 1442--.......................  (1) As die-cut stencils or
                                       reproducible masters; and/or
                                      (2) With additional wording as
                                       required by the executive agency.
                                       (However, the sequence and
                                       wording of the items appearing on
                                       the prescribed form should not be
                                       altered.)
------------------------------------------------------------------------


[48 FR 42637, Sept. 19, 1983, as amended at 51 FR 27121, July 29, 1986; 
54 FR 48998, Nov. 28, 1989]



Sec.  53.107  Obtaining forms.

    (a) Executive agencies shall obtain standard and optional forms from 
the General Services Administration (GSA) by using GSA Supply Catalog - 
Office

[[Page 400]]

Products (see 41 CFR 101-26.302). Standard forms adapted for computer 
preparation (see 53.105) or with special construction and printing (see 
53.106) that are not available from GSA may be ordered directly from the 
Government Printing Office (GPO).
    (b) Contractors and other parties may obtain standard and optional 
forms from the Superintendent of Documents, GPO, Washington, DC 20402. 
Standard and optional forms not available from the Superintendent of 
Documents may be obtained from the prescribing agency.
    (c) Agency forms may be obtained from the prescribing agency.



Sec.  53.108  Recommendations concerning forms.

    Users of this regulation may recommend new forms or the revision, 
elimination, or consolidation of the forms prescribed or referenced in 
this regulation. Recommendations from within an executive agency shall 
be submitted to the cognizant council in accordance with agency 
procedures. Recommendations from other than executive agencies should be 
submitted directly to the FAR Secretariat.



Sec.  53.109  Forms prescribed by other regulations.

    Certain forms referred to in Subpart 53.2 are prescribed in other 
regulations and are specified by the FAR for use in acquisition. For 
each of these forms, the prescribing agency is identified by means of a 
parenthetical notation after the form number. For example, SF 1165, 
which is prescribed by the General Accounting Office (GAO), is 
identified as SF 1165(GAO).



Sec.  53.110  Continuation sheets.

    Except as may be otherwise indicated in the FAR, all standard forms 
prescribed by the FAR may be continued on (a) plain paper of similar 
specification, or (b) specially constructed continuation sheets (e.g., 
OF 336). Continuation sheets shall be annotated in the upper right-hand 
corner with the reference number of the document being continued and the 
serial page number.

[48 FR 42637, Sept. 19, 1983, as amended at 51 FR 27121, July 29, 1986]



Sec.  53.111  Contract clause.

    Contracting officers shall insert the clause at 52.253-1, Computer 
Generated Forms, in solicitations and contracts that require the 
contractor to submit data on Standard or Optional Forms prescribed by 
this regulation; and, unless prohibited by agency regulations, forms 
prescribed by agency supplements.

[55 FR 52800, Dec. 21, 1990]



                   Subpart 53.2_Prescription of Forms



Sec.  53.200  Scope of subpart.

    This subpart prescribes standard forms and references optional forms 
and agency-prescribed forms for use in acquisition. Consistent with the 
approach used in subpart 52.2, this subpart is arranged by subject 
matter, in the same order as, and keyed to, the parts of the FAR in 
which the form usage requirements are addressed. For example, forms 
addressed in FAR part 14, Sealed Bidding, are treated in this subpart in 
section 53.214, Sealed Bidding; forms addressed in FAR part 43, Contract 
Modifications, are treated in this subpart in section 53.243, Contract 
modifications. The following example illustrates how the subjects are 
keyed to the parts in which they are addressed:
[GRAPHIC] [TIFF OMITTED] TC01MY91.001


[48 FR 42637, Sept. 19, 1983, as amended at 50 FR 1748, Jan. 11, 1985; 
50 FR 52429, Dec. 23, 1985]



Sec.  53.201  Federal acquisition system.



Sec.  53.201-1  Contracting authority and responsibilities (SF 1402).

    SF 1402 (10/83), Certificate of Appointment. SF 1402 is prescribed 
for use in appointing contracting officers, as specified in 1.603-3.

[[Page 401]]



Sec.  53.202-53.203  [Reserved]



Sec.  53.204  Administrative matters.



Sec.  53.204-1  Safeguarding classified information within industry (DD Form 
254, DD Form 441).

    The following forms, which are prescribed by the Department of 
Defense, shall be used by agencies covered by the Defense Industrial 
Security Program if contractor access to classified information is 
required, as specified in subpart 4.4 and the clause at 52.204-2:
    (a) DD Form 254 (Department of Defense (DOD)), Contract Security 
Classification Specification. (See 4.403(c)(1).)
    (b) DD Form 441 (DOD), Security Agreement. (See paragraph (b) of the 
clause at 52.204-2.)



Sec.  53.204-2  Contract reporting.

    The following forms are prescribed for use by executive agencies in 
reporting contract actions, as specified in 4.602(c):
    (a) SF 279 (Rev. 10/00), Federal Procurement Data System (FPDS) 
Individual Contract Action Report (See 4.602(c).)
    (b) SF 281 (Rev. 10/00), Federal Procurement Data System (FPDS) 
Summary Contract Action Report ($25,000 or Less). (See 4.602(c).)

[53 FR 43395, Oct. 26, 1988, as amended at 55 FR 52801, Dec. 21, 1990; 
61 FR 67427, Dec. 20, 1997; 62 FR 64940, Dec. 9, 1997; 65 FR 46058, July 
26, 2000]



Sec.  53.205  Publicizing contract actions.



Sec.  53.205-1  Paid advertisements.

    SF 1449, prescribed in 53.212, shall be used to place orders for 
paid advertisements as specified in 5.503.

[61 FR 39198, July 26, 1996]



Sec.  53.206-53.208  [Reserved]



Sec.  53.209  Contractor qualifications.



Sec.  53.209-1  Responsible prospective contractors.

    (a) SF 1403 (Rev. 9/88), Preaward Survey of Prospective Contractor 
(General). SF 1403 is authorized for local reproduction and a copy is 
furnished for this purpose in part 53 of the looseleaf edition of the 
FAR.
    (b) SF 1404 (Rev. 9/88), Preaward Survey of Prospective Contractor--
Technical. SF 1404 is authorized for local reproduction and a copy is 
furnished for this purpose in part 53 of the looseleaf edition of the 
FAR.
    (c) SF 1405 (Rev. 9/88), Preaward Survey of Prospective Contractor--
Production. SF 1405 is authorized for local reproduction and a copy is 
furnished for this purpose in part 53 of the looseleaf edition of the 
FAR.
    (d) SF 1406 (Rev. 11/97), Preaward Survey of Prospective 
Contractor--Quality Assurance. SF 1406 is authorized for local 
reproduction and a copy is furnished for this purpose in part 53 of the 
looseleaf edition of the FAR.
    (e) SF 1407 (Rev. 9/88), Preaward Survey of Prospective Contractor--
Financial Capability. SF 1407 is authorized for local reproduction and a 
copy is furnished for this purpose in part 53 of the looseleaf edition 
of the FAR.
    (f) SF 1408 (Rev. 9/88), Preaward Survey of Prospective Contractor--
Accounting System. SF 1408 is authorized for local reproduction and a 
copy is furnished for this purpose in part 53 of the looseleaf edition 
of the FAR.

[55 FR 25534, June 21, 1990, as amended at 62 FR 64937, Dec. 9, 1997]



Sec.  53.210-53.211  [Reserved]



Sec.  53.212  Acquisition of commercial items.

    SF 1449 (APR 2002), Solicitation/Contract/Order for Commercial 
Items. SF 1449 is prescribed for use in solicitations and contracts for 
commercial items. Agencies may prescribe additional detailed 
instructions for use of the form.

[60 FR 48256, Sept. 18, 1995, as amended at 67 FR 13050, Mar. 20, 2002]



Sec.  53.213  Simplified acquisition procedures (SF's 18, 30, 44, 1165, and 
1449, and OF's 336, 347, and 348).

    The following forms are prescribed as stated in this section for use 
in simplified acquisition procedures, orders under existing contracts or 
agreements, and orders from required sources of supplies and services:
    (a) SF 18 (Rev. 6/95), Request for Quotations, or SF 1449 (Rev. 4/
02), Solicitation/Contract/Order for Commercial

[[Page 402]]

Items. SF 18 is prescribed for use in obtaining price, cost, delivery, 
and related information from suppliers as specified in 13.307(b). SF 
1449, as prescribed in 53.212, or other agency forms/automated formats, 
may also be used to obtain price, cost, delivery, and related 
information from suppliers as specified in 13.307(b).
    (b) SF 30 (Rev. 10/83), Amendment of Solicitation/Modification of 
Contract. SF 30, prescribed in 53.243, may be used for modifying 
purchase orders, as specified in 13.307(c)(3).
    (c) SF 44 (Rev. 10/83), Purchase Order Invoice Voucher. SF 44 is 
prescribed for use in simplified acquisition procedures, as specified in 
13.306.
    (d) SF 1165 (6/83 Ed.), Receipt for Cash-Subvoucher. SF 1165 (GAO) 
may be used for imprest fund purchases, as specified in 13.307(e).
    (e) OF 336 (4/86 Ed.), Continuation Sheet. OF 336, prescribed in 
53.214(h), may be used as a continuation sheet in solicitations, as 
specified in 13.307(c)(1).
    (f) SF 1449, (Rev. 4/02) Solicitation/Contract/Order for Commercial 
Items prescribed in 53.212, OF 347 (Rev. 6/95), Order for Supplies or 
Services, and OF 348 (10/83 Ed.), Order for Supplies or Services-
Schedule Continuation. SF 1449, OF's 347 and 348 (or approved agency 
forms/automated formats) may be used as follows:
    (1) To accomplish acquisitions under simplified acquisition 
procedures, as specified in 13.307.
    (2) To establish blanket purchase agreements (BPA's), as specified 
in 13.303-2, and to make purchases under BPA's, as specified in 13.303-
5.
    (3) To issue orders under basic ordering agreements, as specified in 
16.703(d)(2)(i).
    (4) As otherwise specified in this chapter (e.g., see 5.503(a)(2), 
8.405-2, 36.701(c), and 51.102(e)(3)(ii)).

[61 FR 39198, July 26, 1996, as amended at 62 FR 51266, Sept. 30, 1997; 
62 FR 64929, Dec. 9, 1997; 67 FR 13050, Mar. 20, 2002]



Sec.  53.214  Sealed bidding.

    The following forms are prescribed for use in contracting by sealed 
bidding (except for construction and architect-engineer services):
    (a) SF 26 (4/85), Award/Contract. SF 26 is prescribed for use in 
awarding sealed bid contracts for supplies or services in which bids 
were obtained on SF 33, Solicitation, Offer and Award, as specified in 
14.408-1(d)(1). Pending issuance of a new edition of the form, the 
reference in block 1 should be amended to read 15 CFR 700.
    (b) SF 30, Amendment of Solicitation/Modification of Contract. SF 
30, prescribed in 53.243, shall be used in amending invitations for 
bids, as specified in 14.208(a).
    (c) SF 33 (Rev. 9/97), Solicitation, Offer and Award. SF 33 is 
prescribed for use in soliciting bids for supplies or services and for 
awarding the contracts that result from the bids, as specified in 
14.201-2(a)(1), unless award is accomplished by SF 26.
    (d) SF 1447 (5/88), Solicitation/Contract. SF 1447 is prescribed for 
use in soliciting supplies or services and for awarding contracts that 
result from the bids. It shall be used when the simplified contract 
format is used (see 14.201-9) and may be used in place of the SF 26 or 
SF 33 with other solicitations and awards. Agencies may prescribe 
additional detailed instructions for use of the form.
    (e) [Reserved]
    (f) SF 1409 (Rev. 9/88), Abstract of Offers, and SF 1410 (9/88), 
Abstract of Offers-Continuation. SF 1409 and SF 1410 are prescribed for 
use in recording bids, as specified in 14.403(a).
    (g) OF 17 (Rev. 12/93), Offer Label. OF 17 may be furnished with 
each invitation for bids to facilitate identification and handling of 
bids, as specified in 14.202-3(b).
    (h) OF 336 (Rev. 3/86), Continuation Sheet. OF 336 may be used as a 
continuation sheet in solicitations, as specified in 14.201-2(b).

[48 FR 42637, Sept. 19, 1983, as amended at 50 FR 1748, Jan. 11, 1985; 
50 FR 52429, Dec. 23, 1985; 51 FR 27121, July 29, 1986; 52 FR 19805, May 
27, 1987; 54 FR 29284, July 11, 1989; 54 FR 48998, Nov. 28, 1989; 59 FR 
11388, Mar. 10, 1994; 59 FR 67033, Dec. 28, 1994; 60 FR 34741, July 3, 
1995; 62 FR 240, Jan. 2, 1997; 62 FR 51266, Sept. 30, 1997; 62 FR 64940, 
Dec. 9, 1997; 64 FR 32749, June 17, 1999; 68 FR 43857, July 24, 2003]

[[Page 403]]



Sec.  53.215  Contracting by negotiation.



Sec.  53.215-1  Solicitation and receipt of proposals.

    The following forms are prescribed, as stated in the following 
paragraphs, for use in contracting by negotiation (except for 
construction, architect-engineer services, or acquisitions made using 
simplified acquisition procedures):
    (a) SF 26 (Rev. 4/85), Award/Contract. SF 26, prescribed in 
53.214(a), may be used in entering into negotiated contracts in which 
the signature of both parties on a single document is appropriate, as 
specified in 15.509.
    (b) SF 30 (Rev. 10/83), Amendment of Solicitation/Modification of 
Contract. SF 30, prescribed in 53.243, may be used for amending requests 
for proposals and for amending requests for information, as specified in 
15.210(b).
    (c) SF 33 (Rev. 9/97), Solicitation, Offer and Award. SF 33, 
prescribed in 53.214(c), may be used in connection with the solicitation 
and award of negotiated contracts. Award of such contracts may be made 
by either OF 307, SF 33, or SF 26, as specified in 53.214(c) and 15.509.
    (d) OF 17 (Rev. 12/93), Offer Label. OF 17 may be furnished with 
each request for proposals to facilitate identification and handling of 
proposals, as specified in 15.210(c).
    (e) OF 307 (9/97), Contract Award. OF 307 may be used to award 
negotiated contracts as specified in 15.509.
    (f) OF 308 (9/97), Solicitation and Offer-Negotiated Acquisition. OF 
308 may be used to support solicitation of negotiated contracts as 
specified in 15.210(a). Award of such contracts may be made by OF 307, 
as specified in 15.509.
    (g) OF 309 (9/97), Amendment of Solicitation. OF 309 may be used to 
amend solicitations of negotiated contracts, as specified in 15.210(b).

[62 FR 51266, Sept. 30, 1997, as amended at 62 FR 64940, Dec. 9, 1997; 
64 FR 32749, June 17, 1999; 66 FR 2141, Jan. 10, 2001]



Sec.  53.216  Types of contracts.



Sec.  53.216-1  Delivery orders and orders under basic ordering agreements (OF 347).

    OF 347, Order for Supplies or Services. OF 347, prescribed in 
53.213(f), (or an approved agency form) may be used to place orders 
under indefinite delivery contracts and basic ordering agreements, as 
specified in 16.703(d)(2)(i).

[48 FR 42637, Sept. 19, 1983, as amended at 61 FR 39199, July 26, 1996]



Sec.  53.217-53.218  [Reserved]



Sec.  53.219  Small business programs.

    The following standard forms are prescribed for use in reporting 
small, small disadvantaged and women-owned small business subcontracting 
data, as specified in part 19:
    (a) SF 294 (Rev. 10/01), Subcontracting Report for Individual 
Contracts. (See 19.704(a)(10).) SF 294 is authorized for local 
reproduction and a copy is furnished for this purpose in part 53 of the 
loose-leaf edition of the FAR.
    (b) SF 295 (Rev. 10/01), Summary Subcontract Report. (See 
19.704(a)(10).) SF 295 is authorized for local reproduction and a copy 
is furnished for this purpose in part 53 of the loose-leaf edition of 
the FAR.
    (c) OF 312 (10/01), Small Disadvantaged Business Participation 
Report. (See subpart 19.12.)

[60 FR 48267, Sept. 18, 1995, as amended at 61 FR 67413, Dec. 20, 1996; 
63 FR 34068, June 22, 1998; 63 FR 36125, July 1, 1998; 63 FR 70277, Dec. 
18, 1998; 65 FR 46058, July 26, 2000; 66 FR 53494, Oct. 22, 2001]



Sec.  53.220-53.221  [Reserved]



Sec.  53.222  Application of labor laws to Government acquisitions (SF's 99, 
308, 1093, 1413, 1444, 1445, 1446, WH-347).

    The following forms are prescribed as stated below, for use in 
connection with the application of labor laws:
    (a) [Reserved]
    (b) SF 99 (DOL), Notice of Award of Contract.

[[Page 404]]

    (c) SF 308 (DOL) (Rev. 5/85), Request for Wage Determination and 
Response to Request. (See 22.404-3 (a) and (b).)
    (d) SF 1093 (GAO) (10/71), Schedule of Withholdings under the Davis-
Bacon Act and/or the Contract Work Hours and Safety Standards Act. (See 
22.406-9(c)(1).)
    (e) SF 1413 (Rev. 6/89), Statement and Acknowledgment. SF 1413 is 
prescribed for use in obtaining contractor acknowledgment of inclusion 
of required clauses in subcontracts, as specified in 22.406-5. Pending 
issuance of a new edition of the form, the ``prescribed by'' reference 
at the bottom right of the form is revised to read ``53.222(e)''.
    (f) Form SF 1444 (10/87), Request for Authorization of Additional 
Classification and Rate. (See 22.406-3(a) and 22.1019.)
    (g) SF 1445 (12/96), Labor Standards Interview. (See 22.406-7(b).)
    (h) SF 1446 (10/87), Labor Standards Investigation Summary Sheet. 
(See 22.406-8(d).)
    (i) Form WH-347 (DOL), Payroll (for Contractor's Optional Use). (See 
22.406-6(a).)

[48 FR 42637, Sept. 19, 1983, as amended at 49 FR 12997, Mar. 30, 1984; 
53 FR 4948, Feb. 18, 1988; 53 FR 27468, July 20, 1988; 54 FR 48998, Nov. 
28, 1989; 55 FR 38518, Sept. 18, 1990; 59 FR 11388, Mar. 10, 1994; 62 FR 
240, Jan. 2, 1997]



Sec.  53.223-53.227  [Reserved]



Sec.  53.228  Bonds and insurance.

    The following standard forms are prescribed for use for bond and 
insurance requirements, as specified in part 28:
    (a) SF 24 (Rev. 10/98) Bid Bond. (See 28.106-1.) SF 24 is authorized 
for local reproduction and a copy is furnished for this purpose in Part 
53 of the looseleaf edition of the FAR.
    (b) SF 25 (Rev. 5/96) Performance Bond. (See 28.106-1(b).) SF 25 is 
authorized for local reproduction and a copy is furnished for this 
purpose in Part 53 of the looseleaf edition of the FAR.
    (c) SF 25-A (Rev. 10/98) Payment Bond. (See 28.106-1(c).) SF 25-A is 
authorized for local reproduction and a copy is furnished for this 
purpose in Part 53 of the looseleaf edition of the FAR.
    (d) SF 25-B (Rev. 10/83), Continuation Sheet (For Standard Forms 24, 
25, and 25-A). (See 28.106-1(d).)
    (e) SF 28 (Rev. 6/03) Affidavit of Individual Surety. (See 28.106-
1(e) and 28.203(b).) SF 28 is authorized for local reproduction and a 
copy is furnished for this purpose in Part 53 of the looseleaf edition 
of the FAR.
    (f) SF 34 (Rev. 1/90), Annual Bid Bond. (See 28.106-1(f).) SF 34 is 
authorized for local reproduction and a copy is furnished for this 
purpose in part 53 of the looseleaf edition of the FAR.
    (g) SF 35 (Rev. 1/90), Annual Performance Bond. (See 28.106-1.) SF 
35 is authorized for local reproduction and a copy is furnished for this 
purpose in part 53 of the looseleaf edition of the FAR.
    (h) SF 273 (Rev. 10/98) Reinsurance Agreement for a Miller Act 
Performance Bond. (See 28.106-1(h) and 28.202-1(a)(4).) SF 273 is 
authorized for local reproduction and a copy is furnished for this 
purpose in Part 53 of the looseleaf edition of the FAR.
    (i) SF 274 (Rev. 10/98) Reinsurance Agreement for a Miller Act 
Payment Bond. (See 28.106-1(i) and 28.202-1(a)(4).) SF 274 is authorized 
for local reproduction and a copy is furnished for this purpose in Part 
53 of the looseleaf edition of the FAR.
    (j) SF 275 (Rev. 10/98) Reinsurance Agreement in Favor of the United 
States. (See 28.106-1(j) and 28.202-1(a)(4).) SF 275 is authorized for 
local reproduction and a copy is furnished for this purpose in Part 53 
of the looseleaf edition of the FAR.
    (k) SF 1414 (Rev. 10/93), Consent of Surety. SF 1414 is authorized 
for local reproduction and a copy is furnished for this purpose in part 
53 of the looseleaf edition of the FAR.
    (l) SF 1415 (Rev. 7/93), Consent of Surety and Increase of Penalty. 
(See 28.108-1(l).) SF 1415 is authorized for local reproduction and a 
copy is furnished for this purpose in part 53 of the looseleaf edition 
of the FAR.
    (m) SF 1416 (Rev. 10/98) Payment Bond for Other than Construction 
Contracts. (See 28.106-1(m).) SF 1416 is authorized for local 
reproduction and a copy is furnished for this purpose in Part 53 of the 
looseleaf edition of the FAR.
    (n) SF 1418 (Rev. 2/99) Performance Bond For Other Than Construction 
Contracts. (See 28.106-1(n).) SF 1418 is authorized for local 
reproduction and a copy is furnished for this purpose in

[[Page 405]]

Part 53 of the looseleaf edition of the FAR.
    (o) OF 90 (Rev. 1/90), Release of Lien on Real Property. (See 
28.106-1(o) and 28.203-5(a).) OF 90 is authorized for local reproduction 
and a copy is furnished for this purpose in part 53 of the looseleaf 
edition of the FAR.
    (p) OF 91 (Rev. 1/90), Release of Personal Property from Escrow. 
(See 28.106-1(p) and 28.203-5(a).) OF 91 is authorized for local 
reproduction and a copy is furnished for this purpose in part 53 of the 
looseleaf edition of the FAR.

[48 FR 42637, Sept. 19, 1983, as amended at 53 FR 43395, Oct. 26, 1988; 
54 FR 48998, Nov. 28, 1989; 55 FR 25534, June 21, 1990; 55 FR 52801, 
Dec. 21, 1990; 59 FR 67061, Dec. 28, 1994; 61 FR 39214, July 26, 1996; 
63 FR 58603, Oct. 30, 1998; 63 FR 70293, Dec. 18, 1998; 64 FR 10549, 
Mar. 4, 1999; 68 FR 28088, May 22, 2003]



Sec.  53.229  Taxes (SF's 1094, 1094-A).

    SF 1094 (Rev. 12/96), U.S. Tax Exemption Form, and SF 1094-A (Rev. 
12/96), Tax Exemption Forms Accountability Record. SF's 1094 and 1094-A 
are prescribed for use in establishing exemption from State or local 
taxes, as specified in 29.302(b).

[48 FR 42637, Sept. 19, 1983, as amended at 62 FR 240, Jan.2, 1997]



Sec.  53.230-53.231  [Reserved]



Sec.  53.232  Contract financing (SF 1443).

    SF 1443 (10/82), Contractor's Request for Progress Payment. SF 1443 
is prescribed for use in obtaining contractors' requests for progress 
payments, as specified in 32.503-1.



Sec.  53.233-53.234  [Reserved]



Sec.  53.235  Research and Development Contracting (SF 298).

    SF 298 (2/89), Report Documentation Page. SF 298 is prescribed for 
use in submitting scientific and technical reports to contracting 
officers and to technical information libraries, as specified in 35.010.

[55 FR 3890, Feb. 5, 1990]



Sec.  53.236  Construction and architect-engineer contracts.



Sec.  53.236-1  Construction.

    The following forms are prescribed, as stated below, for use in 
contracting for construction, alteration, or repair, or dismantling, 
demolition, or removal of improvements.
    (a) SF 1417 (Rev. 8/90), Pre-Solicitation Notice (Construction 
Contract). SF 1417 is prescribed for use in notifying prospective 
offerors of solicitations estimated to be $100,000 or more and may be 
used if the proposed contract is estimated to be less than $100,000, as 
specified in 36.701(a).
    (b) SF 1420 (10/83), Performance Evaluation--Construction Contracts. 
SF 1420 is prescribed for use in evaluating and reporting on the 
performance of construction contractors within approved dollar 
thresholds and as otherwise specified in 36.701(e).
    (c)-(d) [Reserved]
    (e) SF 1442 (4/85), Solicitation, Offer and Award (Construction, 
Alteration, or Repair). SF 1442 is prescribed for use in soliciting 
offers and awarding contracts expected to exceed the simplified 
acquisition threshold for (1) construction, alteration, or repair, or 
(2) dismantling, demolition, or removal of improvements (and may be used 
for contracts within the simplified acquisition threshold), as specified 
in 36.701(b).
    (f) OF 347 (6/95), Order for Supplies or Services. OF 347, 
prescribed in 53.213(f), (or an approved agency form) may be used for 
contracts under the simplified acquisition threshold for (1) 
construction, alteration, or repair, or (2) dismantling, demolition, or 
removal of improvements, as specified in 36.701(c).
    (g) OF 1419 (11/88), Abstract of Offers-Construction, and OF 1419A 
(11/88), Abstract of Offers-Construction, Continuation Sheet. OF's 1419 
and 1419A are prescribed for use in recording bids (and may be used for 
recording proposal evaluation information), as specified in 36.701(d).

[48 FR 42637, Sept. 19, 1983, as amended at 50 FR 1748, Jan. 11, 1985; 
53 FR 4948, Feb. 18, 1988; 54 FR 29284, July 11, 1989; 55 FR 52801, Dec. 
21, 1990; 60 FR 34763, July 3, 1995; 61 FR 39199, July 26, 1996]

[[Page 406]]



Sec.  53.236-2  Architect-engineer services (SF's 252, 254, 255, 1421).

    The following forms are prescribed for use in contracting for 
architect-engineer and related services:
    (a) SF 252 (Rev. 10/83), Architect-Engineer Contract. SF 252 is 
prescribed for use in awarding fixed-price contracts for architect-
engineer services, as specified in 36.702(a). [Pending issuance of a new 
edition of the form, Block 8, Negotiation Authority, is deleted.]
    (b) SF 254 (Rev. 11/92), Architect-Engineer and Related Services 
Questionnaire. SF 254 is prescribed for use to obtain information for 
architect-engineer firms regarding their professional qualifications, as 
specified in 36.702(b)(1).
    (c) SF 255 (Rev. 11/92), Architect-Engineer and Related Services 
Questionnaire for Specific Project. SF 255 is prescribed for use within 
approved dollar thresholds and as otherwise specified in 36.702(b)(2), 
whenever an agency requires information to supplement the SF 254 
regarding the prospective firm's qualifications for a particular 
architect-engineer project.
    (d) SF 1421 (10/83), Performance Evaluation (Architect-Engineer). SF 
1421 is prescribed for use in evaluating and reporting on the 
performance of architect-engineer contractors within approved dollar 
thresholds and as otherwise specified in 36.702(c).

[48 FR 42637, Sept. 19, 1983, as amended at 50 FR 1748, Jan. 11, 1985; 
50 FR 52429, Dec. 23, 1985; 57 FR 60591, Dec. 21, 1992]



Sec.  53.237-53.241  [Reserved]



Sec.  53.242  Contract administration.



Sec.  53.242-1  Novation and change-of-name agreements (SF 30).

    SF 30, Amendment of Solicitation/Modification of Contract. SF 30, 
prescribed in 53.243, shall be used in connection with novation and 
change of name agreements, as specified in 42.1203(h).

[48 FR 42637, Sept. 19, 1983, as amended at 62 FR 64935, Dec. 9, 1997]



Sec.  53.243  Contract modifications (SF 30).

    SF 30 (Rev. 10/83), Amendment of Solicitation/Modification of 
Contract. SF 30 is prescribed for use in amending invitation for bids, 
as specified in 14.208; modifying purchase and delivery orders, as 
specified in 13.302-3; and modifying contracts, as specified in 
42.1203(h), 43.301, 49.602-5, and elsewhere in this chapter. The form 
may also be used to amend solicitations for negotiated contracts, as 
specified in 15.210(b). Pending the publication of a new edition of the 
form, Instruction (b), Item 3 (effective date), is revised in paragraphs 
(3) and (5) as follows:
    (b) Item 3 (effective date).
    (3) For a modification issued as a confirming notice of termination 
for the convenience of the Government, the effective date of the 
confirming notice shall be the same as the effective date of the initial 
notice.
    (5) For a modification confirming the termination contracting 
officer's previous letter determination of the amount due in settlement 
of a contract termination for convenience, the effective date shall be 
the same as the effective date of the previous letter determination.

[48 FR 42637, Sept. 19, 1983, as amended at 62 FR 51266, Sept. 30, 1997; 
62 FR 64929, 64936, Dec. 9, 1997]



Sec.  53.244  [Reserved]



Sec.  53.245  Government property.

    The following forms are prescribed, as specified below, for use in 
reporting, redistribution, and disposal of contractor inventory (defined 
in 45.601) and in accounting for this property:
    (a) SF 120 (GSA), Report of Excess Personal Property, and SF 120-A 
(GSA), Continuation Sheet (Report of Excess Personal Property). (See 
45.608-2(b)(2) and 45.608-8.)
    (b) SF 126 (GSA), Report of Personal Property for Sale, and SF 126-A 
(GSA), Report of Personal Property for Sale (Continuation Sheet). (See 
45.610-1(c).)
    (c) SF 1423 (Rev. 12/96), Inventory Verification Survey. (See 
45.606-3(b).)
    (d) SF 1424 (Rev. 7/89), Inventory Disposal Report. (See 45.615.) SF 
1424 is authorized for local reproduction and a copy is furnished for 
this purpose in part 53 of the looseleaf edition of the FAR.
    (e) [Reserved]
    (f) SF 1426 (Rev. 12/96), Inventory Schedule A (Metals in Mill 
Product Form), and SF 1427 (Rev. 7/89), Inventory

[[Page 407]]

Schedule A--Continuation Sheet (Metals in Mill Product Form). (See 
45.606 and 49.602-2(e).) Standard Form 1426 and Standard Form 1427 are 
authorized for local reproduction and copies are furnished for this 
purpose in part 53 of the looseleaf edition of the FAR.
    (g) SF 1428 (Rev. 12/96), Inventory Schedule B, and SF 1429 (Rev. 7/
89), Inventory Schedule B--Continuation Sheet. (See 45.606 and 49.602-
2(b).) Standard Form 1428 and Standard Form 1429 are authorized for 
local reproduction and copies are furnished for this purpose in part 53 
of the looseleaf edition of the FAR.
    (h) SF 1430 (Rev. 12/96), Inventory Schedule C (Work-in-Process) and 
SF 1431 (Rev. 7/89), Inventory Schedule C--Continuation Sheet (Work-in-
Process). (See 45.606 and 49.602-2(c).) Standard Form 1430 and Standard 
Form 1431 are authorized for local reproduction and copies are furnished 
for this purpose in part 53 of the looseleaf edition of the FAR.
    (i) SF 1432 (Rev. 12/96), Inventory Schedule D (Special Tooling and 
Special Test Equipment), and SF 1433 (Rev. 7/89), Inventory Schedule D--
Continuation Sheet (Special Tooling and Special Test Equipment). (See 
45.606 and 49.602-2(d).) Standard Form 1432 and Standard Form 1433 are 
authorized for local reproduction and copies are furnished for this 
purpose in part 53 of the looseleaf edition of the FAR.
    (j) SF 1434 (Rev. 12/96), Termination Inventory Schedule E (Short 
Form For Use with SF 1438 Only). (See 45.606 and 49.602-2(e).) Standard 
Form 1434 is authorized for local reproduction and a copy is furnished 
for this purpose in part 53 of the looseleaf edition of the FAR.

[48 FR 42637, Sept. 19, 1983, as amended at 54 FR 34758, Aug. 21, 1989; 
55 FR 3890, Feb. 5, 1990; 61 FR 41472, Aug. 8, 1996; 62 FR 240, Jan. 2, 
1997]



Sec.  53.246  [Reserved]



Sec.  53.247  Transportation (U.S. Government Bill of Lading).

    The U.S. Government Bill of Lading, prescribed in 41 CFR 101-41.304, 
shall be used for transportation of property, as specified in 47.103.



Sec.  53.248  [Reserved]



Sec.  53.249  Termination of contracts.

    (a) The following forms are prescribed for use in connection with 
the termination of contracts, as specified in subpart 49.6:
    (1) SF 1034 (GAO), Public Voucher for Purchases and Services Other 
Than Personal. (See 49.302(a).)
    (2) SF 1435 (Rev. 9/97), Settlement Proposal (Inventory Basis). (See 
49.602-1(a).) Standard Form 1435 is authorized for local reproduction 
and a copy is furnished for this purpose in part 53 of the looseleaf 
edition of the FAR.
    (3) SF 1436 (Rev. 9/97), Settlement Proposal (Total Cost Basis). 
(See 49.602-1(b).) Standard Form 1436 is authorized for local 
reproduction and a copy is furnished for this purpose in part 53 of the 
looseleaf edition of the FAR.
    (4) SF 1437 (Rev. 9/97), Settlement Proposal for Cost-Reimbursement 
Type Contracts. (See 49.602-1(c) and 49.302.) Standard Form 1437 is 
authorized for local reproduction and a copy is furnished for this 
purpose in part 53 of the looseleaf edition of the FAR.
    (5) SF 1438 (Rev. 7/89), Settlement Proposal (Short Form). (See 
49.602-1(d).) Standard Form 1438 is authorized for local reproduction 
and a copy is furnished for this purpose in part 53 of the looseleaf 
edition of the FAR.
    (6) SF 1439 (Rev. 7/89), Schedule of Accounting Information. (See 
49.602-3.) Standard Form 1439 is authorized for local reproduction and a 
copy is furnished for this purpose in part 53 of the looseleaf edition 
of the FAR.
    (7) SF 1440 (Rev. 7/89), Application for Partial Payment. (See 
49.602-4.) Standard Form 1440 is authorized for local reproduction and a 
copy is furnished for this purpose in part 53 of the looseleaf edition 
of the FAR.
    (b) The inventory schedule forms prescribed in 53.245(f) through (j) 
shall be used to support termination settlement proposals listed in 
paragraph (a), above, as specified in 49.602-2.

[48 FR 42637, Sept. 19, 1983, as amended at 55 FR 3890, Feb. 5, 1990; 62 
FR 51266, Sept. 30, 1997; 62 FR 64940, Dec. 9, 1997]

[[Page 408]]



Sec.  53.250  [Reserved]



Sec.  53.251  Contractor use of Government supply sources (OF 347).

    OF 347, Order for Supplies or Services. OF 347, prescribed in 
53.213(f), may be used by contractors when requisitioning from the VA, 
as specified in 51.102(e)(3)(ii).

[48 FR 42637, Sept. 19, 1983, as amended at 61 FR 39199, July 26, 1996]



                   Subpart 53.3_Illustrations of Forms



Sec.  53.300  Scope of subpart.

    This subpart contains illustrations of forms used in acquisitions.



Sec.  53.301  Standard forms.

    This section illustrates the standard forms that are specified by 
the FAR for use in acquisitions. The forms are illustrated in numerical 
order. The subsection numbers correspond with the standard form numbers 
(e.g., Standard Form 18 appears as 53.301-18).



Sec.  53.301-18--53.301-1449  Illustration of standard forms.

    Editorial Note: The forms appearing in sections 53.301-18 through 
53.301-1449 follow the text of this subpart.



Sec.  53.302  Optional forms.

    This section illustrates the optional forms that are specified by 
the FAR for use in acquisitions. The numbering system is as indicated in 
53.301.



Sec.  53.302-17--53.302-1419A  Illustration of optional forms.

    Editorial Note: The forms appearing in sections 53.302-17 through 
53.302-1419A follow the text of this subpart.



Sec.  53.303  Agency forms.

    This section illustrates agency forms that are specified by the FAR 
for use in acquisitions. The forms are arranged numerically by agency. 
The numbering system is as indicated in 53.301.



Sec.  53.303-254--53.303-347  Illustration of agency forms.

    Editorial Note: The forms appearing in sections 53.303-DD-254 
through 53.303-WH-347 follow the text of this subpart.

[[Page 409]]



Sec.  53.301-18  SF 18 (Rev. 6/95), Request for Quotations.
[GRAPHIC] [TIFF OMITTED] TC01MY91.002


[60 FR 34763, July 3, 1995]

[[Page 410]]



Sec.  53.301-24  Bid Bond.
[GRAPHIC] [TIFF OMITTED] TR18DE98.005


[[Page 411]]


[GRAPHIC] [TIFF OMITTED] TR18DE98.006


[63 FR 70293, Dec. 18, 1998]

[[Page 412]]



Sec.  53.301-25  Performance Bond.
[GRAPHIC] [TIFF OMITTED] TR18DE98.007


[[Page 413]]


[GRAPHIC] [TIFF OMITTED] TR18DE98.008


[63 FR 70296, Dec. 18, 1998]

[[Page 414]]



Sec.  53.301-25-A  Payment Bond.
[GRAPHIC] [TIFF OMITTED] TR18DE98.009


[[Page 415]]


[GRAPHIC] [TIFF OMITTED] TR18DE98.010


[63 FR 70298, Dec. 18, 1998]

[[Page 416]]



Sec.  53.301-25-B  Standard Form 25-B, Continuation Sheet (For Standard 
Forms 24, 25, and 25-A).
[GRAPHIC] [TIFF OMITTED] TC01MY91.009


[[Page 417]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.010


[[Page 418]]





Sec.  53.301-26  Standard Form 26, Award/Contract.
[GRAPHIC] [TIFF OMITTED] TC01MY91.011


[50 FR 1749, Jan. 11, 1985, and 50 FR 52429, Dec. 23, 1985]

[[Page 419]]



Sec.  53.301-28  Affidavit of Individual Surety.
[GRAPHIC] [TIFF OMITTED] TR22MY03.009


[[Page 420]]


[GRAPHIC] [TIFF OMITTED] TR22MY03.010


[68 FR 28088, May 22, 2003]

[[Page 421]]



Sec.  53.301-30  Standard Form 30, Amendment of Solicitation/Modification 
of Contract.
[GRAPHIC] [TIFF OMITTED] TC01MY91.014


[[Page 422]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.015


[[Page 423]]





Sec.  53.301-33  Solicitation, Offer and Award.
[GRAPHIC] [TIFF OMITTED] TR09DE97.002


[62 FR 64941, Dec. 9, 1997]

[[Page 424]]



Sec.  53.301-34  Annual Bid Bond.
[GRAPHIC] [TIFF OMITTED] TC01MY91.017


[[Page 425]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.018


[55 FR 25543, June 21, 1990]

[[Page 426]]



Sec.  53.301-35  Annual Performance Bond.
[GRAPHIC] [TIFF OMITTED] TC01MY91.019


[[Page 427]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.020


[55 FR 25545, June 21, 1990]

[[Page 428]]



Sec.  53.301-44  Standard Form 44, Purchase Order--Invoice--Voucher.
[GRAPHIC] [TIFF OMITTED] TC01MY91.021


[[Page 429]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.022


[[Page 430]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.023


[[Page 431]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.024


[[Page 432]]





Sec.  53.301-98  Standard Form 98, Notice of Intention to Make a 
Service Contract and Response to Notice.
[GRAPHIC] [TIFF OMITTED] TC01MY91.025


[[Page 433]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.026


[[Page 434]]





Sec.  53.301-98a  Standard Form 98a, Notice of Intention to Make a 
Service Contract and Response to Notice (Attachment A).
[GRAPHIC] [TIFF OMITTED] TC01MY91.027


[[Page 435]]





Sec.  53.301-99  Standard Form 99, Notice of Award of Contract.
[GRAPHIC] [TIFF OMITTED] TC01MY91.028


[[Page 436]]





Sec.  53.301-120  Standard Form 120, Report of Excess Personal Property.
[GRAPHIC] [TIFF OMITTED] TC01MY91.029


[[Page 437]]





Sec.  53.301-120-A  Standard Form 120-A, Continuation Sheet (Report of 
Excess Personal Property).
[GRAPHIC] [TIFF OMITTED] TC01MY91.030


[[Page 438]]





Sec.  53.301-126  Standard Form 126, Report of Personal Property for Sale.
[GRAPHIC] [TIFF OMITTED] TC01MY91.031


[[Page 439]]





Sec.  53.301-126-A  Standard Form 126-A, Report of Personal Property 
for Sale (Continuation Sheet).
[GRAPHIC] [TIFF OMITTED] TC01MY91.032


[[Page 440]]





Sec.  53.301-252  Standard Form 252, Architect-Engineer Contract.
[GRAPHIC] [TIFF OMITTED] TC01MY91.035


[[Page 441]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.036


[[Page 442]]





Sec.  53.301-254  Standard Form 254, Architect-Engineer and 
Related Services Questionnaire.
[GRAPHIC] [TIFF OMITTED] TC01MY91.037


[[Page 443]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.038


[[Page 444]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.039


[[Page 445]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.040


[[Page 446]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.041


[[Page 447]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.042


[[Page 448]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.043


[59 FR 11388, Mar. 10, 1994]

[[Page 449]]



Sec.  53.301-255  Standard Form 255, Architect-Engineer and 
Related Services Questionnaire for Specific Project.
[GRAPHIC] [TIFF OMITTED] TC01MY91.044


[[Page 450]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.045


[[Page 451]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.046


[[Page 452]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.047


[[Page 453]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.048


[[Page 454]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.049


[[Page 455]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.050


[[Page 456]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.051


[[Page 457]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.052


[[Page 458]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.053


[[Page 459]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.054


[59 FR 11388, Mar. 10, 1994]

[[Page 460]]



Sec.  53.301-273  Reinsurance Agreement for a Miller Act 
Performance Bond.
[GRAPHIC] [TIFF OMITTED] TR30OC98.020


[[Page 461]]


[GRAPHIC] [TIFF OMITTED] TR30OC98.021


[63 FR 58603, Oct. 30, 1998]

[[Page 462]]



Sec.  53.301-274  Reinsurance Agreement for a Miller Act 
Payment Bond.
[GRAPHIC] [TIFF OMITTED] TR30OC98.022


[[Page 463]]


[GRAPHIC] [TIFF OMITTED] TR30OC98.023

CITA[63 FR 58605, Oct. 30, 1998]
[[Page 464]]





Sec.  53.301-275  Reinsurance Agreement in Favor of the United States.
[GRAPHIC] [TIFF OMITTED] TR18DE98.013


[[Page 465]]


[GRAPHIC] [TIFF OMITTED] TR18DE98.014


[63 FR 70302, Dec. 18, 1998]

[[Page 466]]



Sec.  53.301-279  Federal Procurement Data System (FPDS) Individual 
Contract Action Report.
[GRAPHIC] [TIFF OMITTED] TR26JY00.000


[[Page 467]]


[GRAPHIC] [TIFF OMITTED] TR26JY00.001


[65 FR 46059, July 26, 2000]

[[Page 468]]



Sec.  53.301-281  Federal Procurement Data System (FPDS) Summary 
Contract Action Report ($25,000 or Less).
[GRAPHIC] [TIFF OMITTED] TR26JY00.002


[65 FR 46061, July 26, 2000]

[[Page 469]]



Sec.  53.301-294  Subcontracting Report for Individual Contracts.
[GRAPHIC] [TIFF OMITTED] TR22OC01.001


[[Page 470]]


[GRAPHIC] [TIFF OMITTED] TR22OC01.002


[[Page 471]]


[GRAPHIC] [TIFF OMITTED] TR22OC01.003


[66 FR 53494, Oct. 22, 2001]

[[Page 472]]



Sec.  53.301-295  Summary Subcontract Report.
[GRAPHIC] [TIFF OMITTED] TR22OC01.004


[[Page 473]]


[GRAPHIC] [TIFF OMITTED] TR22OC01.005


[66 FR 53494, Oct. 22, 2001]

[[Page 474]]



Sec.  53.301-298  Standard Form 298, Report Documentation Page.
[GRAPHIC] [TIFF OMITTED] TC01MY91.069


[[Page 475]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.070


[55 FR 3890, Feb. 5, 1990]

[[Page 476]]



Sec.  53.301-308  Standard Form 308, Request for Determination and Response 
to Request.
[GRAPHIC] [TIFF OMITTED] TC01MY91.071


[55 FR 38519, Sept. 18, 1990]

[[Page 477]]



Sec.  53.301-1034  Standard Form 1034, Public Voucher for Purchases and 
Services Other Than Personal.
[GRAPHIC] [TIFF OMITTED] TC01MY91.072


[[Page 478]]





Sec.  53.301-1034A  Standard Form 1034A, Public Voucher for Purchases and 
Services Other Than Personal--Memorandum Copy.
[GRAPHIC] [TIFF OMITTED] TC01MY91.073


[[Page 479]]





Sec.  53.301-1035  Standard Form 1035, Public Voucher for Purchases and 
Services Other Than Personal, Continuation Sheet.
[GRAPHIC] [TIFF OMITTED] TC01MY91.074


[[Page 480]]





Sec.  53.301-1035A  Standard Form 1035A, Public Voucher for Purchases 
and Services Other Than Personal--Memorandum, Continuation Sheet.
[GRAPHIC] [TIFF OMITTED] TC01MY91.075


[[Page 481]]





Sec.  53.301-1093  Standard Form 1093, Schedule of Withholdings Under 
the Davis-Bacon Act and/or the Contract Work Hours and Safety Standards Act.
[GRAPHIC] [TIFF OMITTED] TC01MY91.076


[[Page 482]]





Sec.  53.301-1094  SF 1094, U.S. Tax Exemption Certificates.
[GRAPHIC] [TIFF OMITTED] TR02JA97.009


[[Page 483]]


[GRAPHIC] [TIFF OMITTED] TR02JA97.010


[[Page 484]]


[GRAPHIC] [TIFF OMITTED] TR02JA97.011


[[Page 485]]


[GRAPHIC] [TIFF OMITTED] TR02JA97.012


[62 FR 243, Jan. 2, 1997]

[[Page 486]]



Sec.  53.301-1094A  SF 1094A, Tax Exemption Certificates Accountability 
Record.
[GRAPHIC] [TIFF OMITTED] TR02JA97.013


[[Page 487]]


[GRAPHIC] [TIFF OMITTED] TR02JA97.014


[62 FR 247, Jan. 2, 1997]

[[Page 488]]



Sec.  53.301-1165  Standard Form 1165, Receipt for Cash-Subvoucher.
[GRAPHIC] [TIFF OMITTED] TC01MY91.079


[[Page 489]]





Sec.  53.301-1402  Standard Form 1402, Certicate of Appointment.
[GRAPHIC] [TIFF OMITTED] TC01MY91.080


[[Page 490]]





Sec.  53.301-1403  Preaward Survey of Prospective Contractor (General).
[GRAPHIC] [TIFF OMITTED] TC01MY91.081


[[Page 491]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.082


[55 FR 25553, June 21, 1990]

[[Page 492]]



Sec.  53.301-1404  Preaward Survey of Prospective Contractor--Technical.
[GRAPHIC] [TIFF OMITTED] TC01MY91.083


[55 FR 25555, June 21, 1990]

[[Page 493]]



Sec.  53.301-1405  Preaward Survey of Prospective Contractor--Production.
[GRAPHIC] [TIFF OMITTED] TC01MY91.084


[[Page 494]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.085


[[Page 495]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.086


[[Page 496]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.087


[55 FR 25556, June 21, 1990]

[[Page 497]]



Sec.  53.301-1406  Preaward Survey of Prospective Contractor--Quality Assurance.
[GRAPHIC] [TIFF OMITTED] TR09DE97.000


[[Page 498]]


[GRAPHIC] [TIFF OMITTED] TR09DE97.001


[62 FR 64938, Dec. 9, 1997]

[[Page 499]]



Sec.  53.301-1407  Preaward Survey of Prospective Contractor--Financial Capability.
[GRAPHIC] [TIFF OMITTED] TC01MY91.090


[[Page 500]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.091


[[Page 501]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.092


[55 FR 25562, June 21, 1990]

[[Page 502]]



Sec.  53.301-1408  Preaward Survey of Prospective Contractor--Accounting System.
[GRAPHIC] [TIFF OMITTED] TC01MY91.093


[[Page 503]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.094


[48 FR 42637, Sept. 19, 1983, as amended at 62 FR 40244, July 25, 1997]

[[Page 504]]



Sec.  53.301-1409  Standard Form 1409, Abstract of Offers.
[GRAPHIC] [TIFF OMITTED] TC01MY91.095


[54 FR 29284, July 11, 1989]

[[Page 505]]



Sec.  53.301-1410  Standard Form 1410, Abstract of Offers--Continuation.
[GRAPHIC] [TIFF OMITTED] TC01MY91.096


[54 FR 29286, July 11, 1989]

[[Page 506]]



Sec.  53.301-1413  Standard Form 1413, Statement and Acknowledgment.
[GRAPHIC] [TIFF OMITTED] TC01MY91.100


[54 FR 48998, Nov. 28, 1989]

[[Page 507]]



Sec.  53.301-1414  SF 1414 (Rev. 10/93) Consent of Surety.
[GRAPHIC] [TIFF OMITTED] TC01MY91.101


[59 FR 67061, Dec. 28, 1994]

[[Page 508]]



Sec.  53.301-1415  SF 1415 (Rev. 7/93) Consent of Surety and Increase of Penalty.
[GRAPHIC] [TIFF OMITTED] TC01MY91.102


[59 FR 67063, Dec. 28, 1994]

[[Page 509]]



Sec.  53.301-1416  Payment Bond for Other than Construction Contracts.
[GRAPHIC] [TIFF OMITTED] TR18DE98.015


[[Page 510]]


[GRAPHIC] [TIFF OMITTED] TR18DE98.016


[63 FR 70304, Dec. 18, 1998]

[[Page 511]]



Sec.  53.301-1417  Pre-Solicitation Notice.
[GRAPHIC] [TIFF OMITTED] TC01MY91.105


[55 FR 52811, Dec. 21, 1990]

[[Page 512]]



Sec.  53.301-1418   Performance bond for other than construction contracts.
[GRAPHIC] [TIFF OMITTED] TR04MR99.002


[[Page 513]]


[GRAPHIC] [TIFF OMITTED] TR04MR99.003


[64 FR 10549, Mar. 4, 1999]

[[Page 514]]



Sec.  53.301-1420  Standard Form 1420, Performance Evaluation--Construction Contracts.
[GRAPHIC] [TIFF OMITTED] TC01MY91.108


[[Page 515]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.109


[[Page 516]]





Sec.  53.301-1421  Standard Form 1421, Performance Evaluation (Architect-Engineer).
[GRAPHIC] [TIFF OMITTED] TC01MY91.110


[[Page 517]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.111


[[Page 518]]





Sec.  53.301-1423  SF 1423, Inventory Verification Survey.
[GRAPHIC] [TIFF OMITTED] TR02JA97.015


[62 FR 249, Jan. 2, 1997]

[[Page 519]]



Sec.  53.301-1424  Standard Form 1424, Inventory Disposal Report.
[GRAPHIC] [TIFF OMITTED] TC01MY91.113


[55 FR 3893, Feb. 5, 1990]

[[Page 520]]



Sec.  53.301-1426  SF 1426, Inventory Schedule A (Metals in Mill Product Form).
[GRAPHIC] [TIFF OMITTED] TR02JA97.016


[62 FR 250, Jan. 2, 1997]

[[Page 521]]



Sec.  53.301-1427  Standard Form 1427, Inventory Schedule A--Construction 
Sheet (Metals in Mill Product Form).
[GRAPHIC] [TIFF OMITTED] TC01MY91.115


[55 FR 3897, Feb. 5, 1990]

[[Page 522]]



Sec.  53.301-1428  SF 1428, Inventory Schedule B.
[GRAPHIC] [TIFF OMITTED] TR02JA97.017


[62 FR 251, Jan. 2, 1997]

[[Page 523]]



Sec.  53.301-1429  Standard Form 1429, Inventory Schedule B--Continuation Sheet.
[GRAPHIC] [TIFF OMITTED] TC01MY91.117


[55 FR 3901, Feb. 5, 1990]

[[Page 524]]



Sec.  53.301-1430  Standard Form 1430, Inventory Schedule C (Work-in-Process).
[GRAPHIC] [TIFF OMITTED] TR02JA97.018


[62 FR 252, Jan. 2, 1997]

[[Page 525]]



Sec.  53.301-1431  Inventory Schedule C--Continuation Sheet (Work-in-Process).
[GRAPHIC] [TIFF OMITTED] TC01MY91.119


[55 FR 3905, Feb. 5, 1990]

[[Page 526]]



Sec.  53.301-1432  SF 1432, Inventory Schedule D (Special Tooling and Special 
Test Equipment).
[GRAPHIC] [TIFF OMITTED] TR02JA97.019


[62 FR 253, Jan. 2, 1997]

[[Page 527]]



Sec.  53.301-1433  Inventory Schedule D--Continuation Sheet (Special Tooling 
and Special Test Equipment).
[GRAPHIC] [TIFF OMITTED] TC01MY91.121


[55 FR 3909, Feb. 5, 1990]

[[Page 528]]



Sec.  53.301-1434  SF 1434, Termination Inventory Schedule E (Short Form For 
Use With SF 1438 Only).
[GRAPHIC] [TIFF OMITTED] TR02JA97.020


[62 FR 254, Jan. 2, 1997]

[[Page 529]]



Sec.  53.301-1435  Settlement Proposal (Inventory Basis).
[GRAPHIC] [TIFF OMITTED] TR09DE97.004


[[Page 530]]


[GRAPHIC] [TIFF OMITTED] TR09DE97.005


[[Page 531]]


[GRAPHIC] [TIFF OMITTED] TR09DE97.006


[[Page 532]]


[GRAPHIC] [TIFF OMITTED] TR09DE97.007


[62 FR 64943, Dec. 9, 1997]

[[Page 533]]



Sec.  53.301-1436  Settlement Proposal (Total Cost Basis).
[GRAPHIC] [TIFF OMITTED] TR09DE97.008


[[Page 534]]


[GRAPHIC] [TIFF OMITTED] TR09DE97.009


[[Page 535]]


[GRAPHIC] [TIFF OMITTED] TR09DE97.010


[[Page 536]]


[GRAPHIC] [TIFF OMITTED] TR09DE97.011


[62 FR 64947, Dec. 9, 1997]

[[Page 537]]



Sec.  53.301-1437  Settlement Proposal for Cost-Reimbursement Type Contracts.
[GRAPHIC] [TIFF OMITTED] TR09DE97.012


[62 FR 64951, Dec. 9, 1997]

[[Page 538]]



Sec.  53.301-1438  Settlement Proposal (Short Form).
[GRAPHIC] [TIFF OMITTED] TC01MY91.132


[[Page 539]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.133


[55 FR 3925, Feb. 5, 1990]

[[Page 540]]



Sec.  53.301-1439  Schedule of Accounting Information.
[GRAPHIC] [TIFF OMITTED] TC01MY91.134


[[Page 541]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.135


[[Page 542]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.136


[[Page 543]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.137


[55 FR 3928, Feb. 5, 1990]

[[Page 544]]



Sec.  53.301-1440  Application for Partial Payment.
[GRAPHIC] [TIFF OMITTED] TC01MY91.138


[55 FR 3933, Feb. 5, 1990]

[[Page 545]]



Sec.  53.301-1442  Standard Form 1442, Solicitation, Offer and Award 
(Construction, Alteration, or Repair).
[GRAPHIC] [TIFF OMITTED] TC01MY91.139


[[Page 546]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.140


[50 FR 1752, Jan. 11, 1985, and 50 FR 52429, Dec. 23, 1985]

[[Page 547]]



Sec.  53.301-1443  Standard Form 1443, Contractor's Request for Progress Payment.
[GRAPHIC] [TIFF OMITTED] TC01MY91.141


[[Page 548]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.142


[[Page 549]]





Sec.  53.301-1444  Request for Authorization of Additional Classification and Rate.
[GRAPHIC] [TIFF OMITTED] TC01MY91.143


[53 FR 4949, Feb. 18, 1988]

[[Page 550]]



Sec.  53.301-1445  SF 1445, Labor Standards Interview.
[GRAPHIC] [TIFF OMITTED] TR02JA97.021


[62 FR 255, Jan. 2, 1997]

[[Page 551]]



Sec.  53.301-1446  Labor Standards Investigation Summary Sheet.
[GRAPHIC] [TIFF OMITTED] TC01MY91.145


[53 FR 4951, Feb. 18, 1988]

[[Page 552]]



Sec.  53.301-1447  Solicitation/Contract.
[GRAPHIC] [TIFF OMITTED] TC01MY91.146


[[Page 553]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.147


[55 FR 38520, Sept. 18, 1990]

[[Page 554]]



Sec.  53.301-1449  Solicitation/Contract/Order for Commercial Items.
[GRAPHIC] [TIFF OMITTED] TR20MR02.000


[[Page 555]]


[GRAPHIC] [TIFF OMITTED] TR20MR02.001


[67 FR 13050, Mar. 20, 2002]

[[Page 556]]



Sec.  53.302-17  Optional Form 17, Offer Label.
[GRAPHIC] [TIFF OMITTED] TC01MY91.150


[59 FR 67034, Dec. 28, 1994]

[[Page 557]]



Sec.  53.302-90  Release of Lien on Real Property.
[GRAPHIC] [TIFF OMITTED] TC01MY91.151


[55 FR 38522, Sept. 18, 1990]

[[Page 558]]



Sec.  53.302-91  Release of Personal Property From Escrow.
[GRAPHIC] [TIFF OMITTED] TC01MY91.152


[55 FR 38523, Sept. 18, 1990]

[[Page 559]]



Sec.  53.302-307  Optional Form 307, Contract Award.
[GRAPHIC] [TIFF OMITTED] TR30SE97.002


[62 FR 51266, Sept. 30, 1997]

[[Page 560]]



Sec.  53.302-308  Optional Form 308, Solicitation and Offer--Negotiated Acquisition.
[GRAPHIC] [TIFF OMITTED] TR30SE97.003


[62 FR 51268, Sept. 30, 1997]

[[Page 561]]



Sec.  53.302-309  Optional Form 309, Amendment of Solicitation.
[GRAPHIC] [TIFF OMITTED] TR30SE97.004


[62 FR 51269, Sept. 30, 1997]

[[Page 562]]



Sec.  53.302-312  Small Disadvantaged Business (SDB) Participation Report.
[GRAPHIC] [TIFF OMITTED] TR26JY00.003


[[Page 563]]


[GRAPHIC] [TIFF OMITTED] TR26JY00.004


[65 FR 46062, July 26, 2000]

[[Page 564]]



Sec.  53.302-333  Procurement Integrity Certification for Procurement Officials.
[GRAPHIC] [TIFF OMITTED] TC01MY91.154


[59 FR 11388, Mar. 10, 1994, as amended at 62 FR 233, Jan. 2, 1997]

[[Page 565]]



Sec.  53.302-336  Optional Form 336, Continuation Sheet.
[GRAPHIC] [TIFF OMITTED] TC01MY91.155


[51 FR 27122, July 29, 1986, as amended at 62 FR 40244, July 25, 1997]

[[Page 566]]



Sec.  53.302-347  OF 347 (Rev. 6/95), Order for Supplies or Services.
[GRAPHIC] [TIFF OMITTED] TC01MY91.156


[[Page 567]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.157


[60 FR 34764, July 3, 1995]

[[Page 568]]



Sec.  53.302-348  Optional Form 348, Order for Supplies or Services Schedule--
Continuation.
[GRAPHIC] [TIFF OMITTED] TC01MY91.158


[[Page 569]]





Sec.  53.302-1419  Optional Form 1419, Abstract of Offers--Construction.
[GRAPHIC] [TIFF OMITTED] TC01MY91.159


[54 FR 29290, July 11, 1989]

[[Page 570]]



Sec.  53.302-1419A  Optional Form 1419A, Abstract of Offers--Construction, 
Continuation Sheet.
[GRAPHIC] [TIFF OMITTED] TC01MY91.160


[54 FR 29292, July 11, 1989]

[[Page 571]]



Sec.  53.303-DD-254  Department of Defense DD Form 254, Contract Security 
Classification Specification.
[GRAPHIC] [TIFF OMITTED] TC01MY91.161


[[Page 572]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.162


[56 FR 41741, Aug. 22, 1991]

[[Page 573]]



Sec.  53.303-DD-441  Department of Defense DD Form 441, Security Agreement.
[GRAPHIC] [TIFF OMITTED] TC01MY91.163


[[Page 574]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.164


[[Page 575]]





Sec.  53.303-WH-347  Department of Labor Form WH-347, Payroll (For Contractor's 
Optional Use).
[GRAPHIC] [TIFF OMITTED] TC01MY91.165


[[Page 576]]


[GRAPHIC] [TIFF OMITTED] TC01MY91.166


[[Page 577]]



                         PARTS 54-99 [RESERVED]

[[Page 579]]



                              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
  Table of OMB Control Numbers
  List of CFR Sections Affected

[[Page 581]]



                    Table of CFR Titles and Chapters




                     (Revised as of October 1, 2003)

                      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)

                   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)
         V  The International Organizations Employees Loyalty 
                Board (Parts 1500--1599)
        VI  Federal Retirement Thrift Investment Board (Parts 
                1600--1699)
      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)
      XXIV  Federal Energy Regulatory Commission (Part 3401)
       XXV  Department of the Interior (Part 3501)
      XXVI  Department of Defense (Part 3601)

[[Page 582]]

    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)
        LV  National Endowment for the Arts (Part 6501)
       LVI  National Endowment for the Humanitiess (Part 6601)
      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)
     LXVII  Institute of Museum and Library Services (Part 7701)
      LXIX  Tennessee Valley Authority (Part 7901)
      LXXI  Consumer Product Safety Commission (Part 8101)
    LXXIII  Department of Agriculture (Part 8301)
     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--Homeland Security

         I  Department of Homeland Security, Office of the 
                Secretary (Parts 0--99)

[[Page 583]]

                         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 Nutrition Service, Department of Agriculture 
                (Parts 210--299)
       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)
       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)
        XX  Local Television Loan Guarantee Board (Parts 2200--
                2299)
      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)

[[Page 584]]

      XXXI  Office of Environmental Quality, Department of 
                Agriculture (Parts 3100--3199)
     XXXII  Office of Procurement and Property Management, 
                Department of Agriculture (Parts 3200--3299)
    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)
     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  Department of Homeland Security (Immigration and 
                Naturalization) (Parts 1--599)
         V  Executive Office for Immigration Review, Department of 
                Justice (Parts 1000--1400)

                 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, 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)
      XVII  Defense Nuclear Facilities Safety Board (Parts 1700--
                1799)
     XVIII  Northeast Interstate Low-Level Radioactive Waste 
                Commission (Part 1800)

[[Page 585]]

                      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)
      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  Department of the Treasury (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)
        IV  Emergency Steel Guarantee Loan Board (Parts 400--499)
         V  Emergency Oil and Gas Guaranteed Loan Board (Parts 
                500--599)

                    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)
        VI  Air Transportation System Stabilization (Parts 1300--
                1399)

                 Title 15--Commerce and Foreign Trade

            Subtitle A--Office of the Secretary of Commerce (Parts 
                0--29)

[[Page 586]]

            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 Industry and Security, 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)
            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)

[[Page 587]]

                       Title 19--Customs Duties

         I  Bureau of Customs and Border Protection, Department of 
                Homeland Security; Department of the Treasury 
                (Parts 0--199)
        II  United States International Trade Commission (Parts 
                200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)
        IV  Bureau of Immigration and Customs Enforcement, 
                Department of Homeland Security (Parts 400--599)

                     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)
        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 (Parts 200--299)
       III  Peace Corps (Parts 300--399)
        IV  International Joint Commission, United States and 
                Canada (Parts 400--499)
         V  Broadcasting Board of Governors (Parts 500--599)
       VII  Overseas Private Investment Corporation (Parts 700--
                799)
        IX  Foreign Service Grievance Board (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)

[[Page 588]]

       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)

                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)
        IV  Office of Housing and Office of Multifamily Housing 
                Assistance Restructuring, Department of Housing 
                and Urban Development (Parts 400--499)
         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, Section 202 Direct Loan Program, Section 
                202 Supportive Housing for the Elderly Program and 
                Section 811 Supportive Housing for Persons With 
                Disabilities Program) (Parts 800--899)
        IX  Office of Assistant Secretary for Public and Indian 
                Housing, Department of Housing and Urban 
                Development (Parts 900--1699)

[[Page 589]]

         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 (Parts 1000--1199)
       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--899)

           Title 27--Alcohol, Tobacco Products and Firearms

         I  Alcohol and Tobacco Tax and Trade Bureau, Department 
                of the Treasury (Parts 1--299)
        II  Bureau of Alcohol, Tobacco, Firearms, and Explosives, 
                Department of Justice (Parts 400--699)

                   Title 28--Judicial Administration

         I  Department of Justice (Parts 0--299)
       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)

[[Page 590]]

      VIII  Court Services and Offender Supervision Agency for the 
                District of Columbia (Parts 800--899)
        IX  National Crime Prevention and Privacy Compact Council 
                (Parts 900--999)
        XI  Department of Justice and Department of State (Parts 
                1100--1199)

                            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  Employee Benefits Security 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)

                      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)
       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)

[[Page 591]]

            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)
        IX  Federal Claims Collection Standards (Department of the 
                Treasury--Department of Justice) (Parts 900--999)

                      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)
     XVIII  National Counterintelligence Center (Parts 1800--1899)
       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)

               Title 33--Navigation and Navigable Waters

         I  Coast Guard, Department of Homeland Security (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)

[[Page 592]]

            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)
        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)
         X  Presidio Trust (Parts 1000--1099)
        XI  Architectural and Transportation Barriers Compliance 
                Board (Parts 1100--1199)
       XII  National Archives and Records Administration (Parts 
                1200--1299)
        XV  Oklahoma City National Memorial Trust (Part 1501)
       XVI  Morris K. Udall Scholarship and Excellence in National 
                Environmental Policy Foundation (Parts 1600--1699)

             Title 37--Patents, Trademarks, and Copyrights

         I  United States 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)

[[Page 593]]

           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)
        IV  Environmental Protection Agency and Department of 
                Justice (Parts 1400--1499)
         V  Council on Environmental Quality (Parts 1500--1599)
        VI  Chemical Safety and Hazard Investigation Board (Parts 
                1600--1699)
       VII  Environmental Protection Agency and Department of 
                Defense; Uniform National Discharge Standards for 
                Vessels of the Armed Forces (Parts 1700--1799)

          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 Service, 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)
       102  Federal Management Regulation (Parts 102-1--102-299)
       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
       300  General (Parts 300-1--300-99)
       301  Temporary Duty (TDY) Travel Allowances (Parts 301-1--
                301-99)

[[Page 594]]

       302  Relocation Allowances (Parts 302-1--302-99)
       303  Payment of Expenses Connected with the Death of 
                Certain Employees (Part 303-70)
       304  Payment of Travel Expenses from a Non-Federal Source 
                (Parts 304-1--304-99)

                        Title 42--Public Health

         I  Public Health Service, Department of Health and Human 
                Services (Parts 1--199)
        IV  Centers for Medicare & Medicaid Services, 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, Department of 
                Homeland Security (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)

[[Page 595]]

        VI  National Science Foundation (Parts 600--699)
       VII  Commission on Civil Rights (Parts 700--799)
      VIII  Office of Personnel Management (Parts 800--899)
         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  Corporation for National and Community Service (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)
     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 Homeland Security (Parts 
                1--199)
        II  Maritime Administration, Department of Transportation 
                (Parts 200--399)
       III  Coast Guard (Great Lakes Pilotage), Department of 
                Homeland Security (Parts 400--499)
        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)

[[Page 596]]

         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)
        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  Broadcasting Board of Governors (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 (Parts 
                5400--5499)
        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)

[[Page 597]]

                       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)
       III  Federal Motor Carrier Safety Administration, 
                Department of Transportation (Parts 300--399)
        IV  Coast Guard, Department of Homeland Security (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)
        XI  Bureau of Transportation Statistics, Department of 
                Transportation (Parts 1400--1499)
       XII  Transportation Security Administration, Department of 
                Homeland Security (Parts 1500--1599)

                   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
            List of CFR Titles, Chapters, Subchapters, and Parts
            Alphabetical List of Agencies Appearing in the CFR

[[Page 599]]





           Alphabetical List of Agencies Appearing in the CFR




                     (Revised as of October 1, 2003)

                                                  CFR Title, Subtitle or 
                     Agency                               Chapter

Administrative Committee of the Federal Register  1, I
Advanced Research Projects Agency                 32, I
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                            5, LXXIII
  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 Nutrition 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
  Procurement and Property Management, Office of  7, XXXII
  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
Air Transportation Stabilization Board            14, VI
Alcohol and Tobacco Tax and Trade Bureau          27, I
Alcohol, Tobacco, Firearms, and Explosives,       27, II
     Bureau of
AMTRAK                                            49, VII
American Battle Monuments Commission              36, IV
American Indians, Office of the Special Trustee   25, VII
Animal and Plant Health Inspection Service        7, III; 9, I
Appalachian Regional Commission                   5, IX

[[Page 600]]

Architectural and Transportation Barriers         36, XI
     Compliance Board
Arctic Research Commission                        45, XXIII
Armed Forces Retirement Home                      5, XI
Army Department                                   32, V
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 51
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
Broadcasting Board of Governors                   22, V
  Federal Acquisition Regulation                  48, 19
Census Bureau                                     15, I
Centers for Medicare & Medicaid Services          42, IV
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
Civil Rights, Commission on                       45, VII
Civil Rights, Office for                          34, I
Coast Guard                                       33, I; 46, I; 49, IV
Coast Guard (Great Lakes Pilotage)                46, III
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
  Federal Acquisition Regulation                  48, 13
  Fishery Conservation and Management             50, VI
  Foreign-Trade Zones Board                       15, IV
  Industry and Security, Bureau of                15, VII
  International Trade Administration              15, III; 19, III
  National Institute of Standards and Technology  15, II
  National Marine Fisheries Service               50, II, IV, VI
  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, United States      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
Corporation for National and Community Service    45, XII, XXV
Cost Accounting Standards Board                   48, 99
Council on Environmental Quality                  40, V
Court Services and Offender Supervision Agency    28, VIII
     for the District of Columbia
Customs and Border Protection Bureau              19, I
Defense Contract Audit Agency                     32, I
Defense Department                                5, XXVI; 32, Subtitle A; 
                                                  40, VII

[[Page 601]]

  Advanced Research Projects Agency               32, I
  Air Force Department                            32, VII
  Army Department                                 32, V; 33, II; 36, III, 
                                                  48, 51
  Defense Intelligence Agency                     32, I
  Defense Logistics Agency                        32, I, XII; 48, 54
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 2
  National Imagery and Mapping Agency             32, I
  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 Nuclear Facilities Safety Board           10, XVII
Delaware River Basin Commission                   18, III
District of Columbia, Court Services and          28, VIII
     Offender Supervision Agency for the
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
Emergency Oil and Gas Guaranteed Loan Board       13, V
Emergency Steel Guarantee Loan Board              13, IV
Employee Benefits Security Administration         29, XXV
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
Environmental Protection Agency                   5, LIV; 40, I, IV, VII
  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                5, III, LXXVII; 14, VI; 
                                                  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

[[Page 602]]

  Trade Representative, Office of the United      15, XX
       States
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
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               31, IX
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
Federal Home Loan Mortgage Corporation            1, IV
Federal Housing Enterprise Oversight Office       12, XVII
Federal Housing Finance Board                     12, IX
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 Management Regulation                     41, 102
Federal Maritime Commission                       46, IV
Federal Mediation and Conciliation Service        29, XII
Federal Mine Safety and Health Review Commission  5, LXXIV; 29, XXVII
Federal Motor Carrier Safety Administration       49, III
Federal Prison Industries, Inc.                   28, III
Federal Procurement Policy Office                 48, 99
Federal Property Management Regulations           41, 101
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 Nutrition 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
General Services Administration                   5, LVII; 41, 105
  Contract Appeals, Board of                      48, 61
  Federal Acquisition Regulation                  48, 5

[[Page 603]]

  Federal Management Regulation                   41, 102
  Federal Property Management Regulations         41, 101
  Federal Travel Regulation System                41, Subtitle F
  General                                         41, 300
  Payment From a Non-Federal Source for Travel    41, 304
       Expenses
  Payment of Expenses Connected With the Death    41, 303
       of Certain Employees
  Relocation Allowances                           41, 302
  Temporary Duty (TDY) 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
Harry S. Truman Scholarship Foundation            45, XVIII
Health and Human Services, Department of          5, XLV; 45, Subtitle A
  Centers for Medicare & Medicaid Services        42, IV
  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
  Human Development Services, Office of           45, XIII
  Indian Health Service                           25, V; 42, I
  Inspector General (Health Care), Office of      42, V
  Public Health Service                           42, I
  Refugee Resettlement, Office of                 45, IV
Homeland Security, Department of                  6, I
  Coast Guard                                     33, I; 46, I; 49, IV
  Coast Guard (Great Lakes Pilotage)              46, III
  Customs and Border Protection Bureau            19, I
  Federal Emergency Management Agency             44, I
  Immigration and Customs Enforcement Bureau      19, IV
  Immigration and Naturalization                  8, I
  Transportation Security Administration          49, XII
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
  Housing, Office of, and Multifamily Housing     24, IV
       Assistance Restructuring, Office of
  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
Housing, Office of, and Multifamily Housing       24, IV
     Assistance Restructuring, Office of
Human Development Services, Office of             45, XIII
Immigration and Customs Enforcement Bureau        19, IV
Immigration and Naturalization                    8, I
Immigration Review, Executive Office for          8, V
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; 42, I
Industry and Security, Bureau of                  15, VII
Information Resources Management, Office of       7, XXVII
Information Security Oversight Office, National   32, XX
     Archives and Records Administration
Inspector General

[[Page 604]]

  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
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
  Land Management, Bureau of                      43, II
  Minerals Management Service                     30, II
  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 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, XI; 40, 
                                                  IV
  Alcohol, Tobacco, Firearms, and Explosives,     27, II
       Bureau of
  Drug Enforcement Administration                 21, II
  Federal Acquisition Regulation                  48, 28
  Federal Claims Collection Standards             31, IX
  Federal Prison Industries, Inc.                 28, III
  Foreign Claims Settlement Commission of the     45, V
       United States
  Immigration Review, Executive Office for        8, V
  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
  Employee Benefits Security Administration       29, XXV
  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
  Public Contracts                                41, 50
  Secretary of Labor, Office of                   29, Subtitle A

[[Page 605]]

  Veterans' Employment and Training Service,      41, 61; 20, IX
       Office of 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
Local Television Loan Guarantee Board             7, XX
Management and Budget, Office of                  5, III, LXXVII; 14, VI; 
                                                  48, 99
Marine Mammal Commission                          50, V
Maritime Administration                           46, II
Merit Systems Protection Board                    5, II
Micronesian Status Negotiations, Office for       32, XXVII
Mine Safety and Health Administration             30, I
Minerals Management Service                       30, II
Minority Business Development Agency              15, XIV
Miscellaneous Agencies                            1, IV
Monetary Offices                                  31, I
Morris K. Udall Scholarship and Excellence in     36, XVI
     National Environmental Policy Foundation
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 and Community Service, Corporation for   45, XII, XXV
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 Council on Disability                    34, XII
National Counterintelligence Center               32, XVIII
National Credit Union Administration              12, VII
National Crime Prevention and Privacy Compact     28, IX
     Council
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 Imagery and Mapping Agency               32, I
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, VI
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 Interstate Low-Level Radioactive Waste  10, XVIII
   Commission
[[Page 606]]

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
Oklahoma City National Memorial Trust             36, XV
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, United States        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 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
  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 Documents                            3
Presidio Trust                                    36, X
Prisons, Bureau of                                28, V
Procurement and Property Management, Office of    7, XXXII
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; 28, XI
  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

[[Page 607]]

Technology, Under Secretary for                   37, V
Tennessee Valley Authority                        5, LXIX; 18, XIII
Thrift Supervision Office, Department of the      12, V
     Treasury
Trade Representative, United States, Office of    15, XX
Transportation, Department of                     5, L
  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
  Federal Motor Carrier Safety Administration     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
  Transportation Statistics Bureau                49, XI
Transportation, Office of                         7, XXXIII
Transportation Security Administration            49, XII
Transportation Statistics Bureau                  49, XI
Travel Allowances, Temporary Duty (TDY)           41, 301
Treasury Department                               5, XXI; 12, XV; 17, IV; 
                                                  31, IX
  Alcohol and Tobacco Tax and Trade Bureau        27, I
  Community Development Financial Institutions    12, XVIII
       Fund
  Comptroller of the Currency                     12, I
  Customs and Border Protection Bureau            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
Utah Reclamation Mitigation and Conservation      43, III
     Commission
Veterans Affairs Department                       38, I
  Federal Acquisition Regulation                  48, 8
Veterans' Employment and Training Service,        41, 61; 20, IX
     Office of the 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 609]]







                      Table of OMB Control Numbers



The OMB control numbers for chapter I of title 48 were consolidated into 
section 1.106. Section 1.106 is reprinted below for the convenience of 
the user.

1.106  OMB approval under the Paperwork Reduction Act.

    The Paperwork Reduction Act of 1980 (Pub. L. 96-511) imposes a 
requirement on Federal agencies to obtain approval from the Office of 
Management and Budget (OMB) before collecting information from 10 or 
more members of the public. The information collection and recordkeeping 
requirements contained in this regulation have been approved by the OMB. 
The following OMB control numbers apply:

------------------------------------------------------------------------
                                                             OMB control
                        FAR segment                              No.
------------------------------------------------------------------------
3.103......................................................    9000-0018
3.4........................................................    9000-0003
4.102......................................................    9000-0033
4.7........................................................    9000-0034
4.9........................................................    9000-0097
4.602......................................................    9000-0145
4.603......................................................    9000-0145
5.405......................................................    9000-0036
7.2........................................................    9000-0082
8.5........................................................    9000-0113
9.1........................................................    9000-0011
9.2........................................................    9000-0020
14.201.....................................................    9000-0034
14.202-4...................................................    9000-0040
14.202-5...................................................    9000-0039
14.205.....................................................    9000-0037
14.214.....................................................    9000-0105
14.407.....................................................    9000-0038
14.5.......................................................    9000-0041
15.2.......................................................    9000-0037
15.209.....................................................    9000-0034
15.4.......................................................    9000-0013
15.404-1(f)................................................    9000-0080
15.407-2...................................................    9000-0078
15.408.....................................................    9000-0115
19.7.......................................................    9000-0006
19.12......................................................    9000-0150
22.103.....................................................    9000-0065
22.8.......................................................    1215-0072
22.11......................................................    9000-0066
22.13......................................................    1215-0072
22.14......................................................    1215-0072
23.9.......................................................    9000-0139
23.602.....................................................    9000-0107
27.3.......................................................    9000-0095
27.4.......................................................    9000-0090
28.1.......................................................    9000-0045
28.2.......................................................    9000-0045
29.304.....................................................    9000-0059
30.6.......................................................    9000-0129
31.205-46..................................................    9000-0079
31.205-46(a)(3)............................................    9000-0088
32.........................................................    9000-0035
32.000.....................................................    9000-0138
32.1.......................................................    9000-0070
                                                                     and
                                                               9000-0138
32.2.......................................................    9000-0138
32.4.......................................................    9000-0073
32.5.......................................................    9000-0010
                                                                     and
                                                               9000-0138
32.7.......................................................    9000-0074
32.9.......................................................    9000-0102
32.10......................................................    9000-0138
33.........................................................    9000-0035
34.1.......................................................    9000-0132
36.213-2...................................................    9000-0037
36.603.....................................................    9000-0004
                                                                     and
                                                               9000-0005
36.701.....................................................    9000-0037
41.202(c)..................................................    9000-0125
42.7.......................................................    9000-0013
42.12......................................................    9000-0076
42.13......................................................    9000-0076
42.14......................................................    9000-0056
43.205(f)..................................................    9000-0026
45.........................................................    9000-0075
46.........................................................    9000-0077
47.........................................................    9000-0061
48.........................................................    9000-0027
49.........................................................    9000-0028
50.........................................................    9000-0029
51.1.......................................................    9000-0031
51.2.......................................................    9000-0032
52.203-2...................................................    9000-0018
52.203-7...................................................    9000-0091
52.204-3...................................................    9000-0097
52.204-6...................................................    9000-0145
52.204-7...................................................    9000-0159
52.207-3...................................................    9000-0114
52.212-1(k)................................................    9000-0159
52.212-3...................................................    9000-0136
52.212-4(t)................................................    9000-0159
52.214-14..................................................    9000-0047
52.214-15..................................................    9000-0044
52.214-16..................................................    9000-0044
52.214-21..................................................    9000-0039
52.214-26..................................................    9000-0034
52.214-28..................................................    9000-0013
52.215-1(c)(2)(iv).........................................    9000-0048
52.215-1(d)................................................    9000-0044

[[Page 610]]

 
52.215-2...................................................    9000-0034
52.215-6...................................................    9000-0047
52.215-9...................................................    9000-0078
52.215-12..................................................    9000-0013
52.215-13..................................................    9000-0013
52.215-14..................................................    9000-0080
52.215-19..................................................    9000-0115
52.215-20..................................................    9000-0013
52.215-21..................................................    9000-0013
52.216-2...................................................    9000-0068
52.216-3...................................................    9000-0068
52.216-4...................................................    9000-0068
52.216-5...................................................    9000-0071
52.216-6...................................................    9000-0071
52.216-7...................................................    9000-0069
52.216-10..................................................    9000-0067
52.216-13..................................................    9000-0069
52.216-15..................................................    9000-0069
52.216-16..................................................    9000-0067
52.216-17..................................................    9000-0067
52.219-9...................................................    9000-0006
52.219-10..................................................    9000-0006
52.219-19..................................................    9000-0100
52.219-20..................................................    9000-0100
52.219-21..................................................    9000-0100
52.219-22..................................................    9000-0150
52.219-23..................................................    9000-0150
52.219-25..................................................    9000-0150
52.222-2...................................................    9000-0065
52.222-4...................................................    1215-0119
52.222-6...................................................    1215-0140
52.222-8...................................................    1215-0149
                                                                     and
                                                               1215-0017
52.222-11..................................................    9000-0014
52.222-18..................................................    9000-0127
52.222-21..................................................    1215-0072
52.222-22..................................................    1215-0072
52.222-23..................................................    1215-0072
52.222-25..................................................    1215-0072
52.222-26..................................................    1215-0072
52.222-27..................................................    1215-0072
52.222-32..................................................    9000-0154
52.222-35..................................................    1215-0072
52.222-36..................................................    1215-0072
52.222-41..................................................    1215-0017
                                                                     and
                                                               1215-0150
52.222-46..................................................    9000-0066
52.223-4...................................................    9000-0134
52.223-5...................................................    9000-0147
52.223-6(b)(5).............................................    9000-0101
52.233-7...................................................    9000-0117
52.223-9...................................................    9000-0134
52.223-13..................................................    9000-0139
52.223-14..................................................    9000-0139
52.225-2...................................................    9000-0023
                                                                     and
                                                               9000-0024
52.225-4...................................................    9000-0130
52.225-6...................................................    9000-0025
52.225-8...................................................    9000-0022
52.225-9...................................................    9000-0141
52.225-11..................................................    9000-0141
52.227-14..................................................    9000-0090
52.227-15..................................................    9000-0090
52.227-16..................................................    9000-0090
52.227-17..................................................    9000-0090
52.227-18..................................................    9000-0090
52.227-19..................................................    9000-0090
52.227-20..................................................    9000-0090
52.227-21..................................................    9000-0090
52.227-22..................................................    9000-0090
52.227-23..................................................    9000-0090
52.228-1...................................................    9000-0045
52.228-2...................................................    9000-0045
52.228-12..................................................    9000-0135
52.228-13..................................................    9000-0045
52.228-15..................................................    9000-0045
52.228-16..................................................    9000-0045
52.229-2...................................................    9000-0059
52.230-6...................................................    9000-0129
52.232-1...................................................    9000-0070
52.232-2...................................................    9000-0070
52.232-3...................................................    9000-0070
52.232-4...................................................    9000-0070
52.232-5...................................................    9000-0070
52.232-6...................................................    9000-0070
52.232-7...................................................    9000-0070
52.232-8...................................................    9000-0070
52.232-9...................................................    9000-0070
52.232-10..................................................    9000-0070
52.232-11..................................................    9000-0070
52.232-12..................................................    9000-0073
52.232-13..................................................    9000-0010
52.232-14..................................................    9000-0010
52.232-15..................................................    9000-0010
52.232-16..................................................    9000-0010
52.232-20..................................................    9000-0074
52.232-21..................................................    9000-0074
52.232-22..................................................    9000-0074
52.232-27..................................................    9000-0102
52.232-29..................................................    9000-0138
52.232-30..................................................    9000-0138
52.232-31..................................................    9000-0138
52.232-32..................................................    9000-0138
52.233-1...................................................    9000-0035
52.234-1...................................................    9000-0133
52.236-5...................................................    9000-0062
52.236-13..................................................    1220-0029
                                                                     and
                                                               9000-0060
52.236-15..................................................    9000-0058
52.236-19..................................................    9000-0064
52.241-1...................................................    9000-0126
52.241-3...................................................    9000-0122
52.241-7...................................................    9000-0123
52.241-13..................................................    9000-0124
52.242-12..................................................    9000-0056
52.243-1...................................................    9000-0026
52.243-2...................................................    9000-0026
52.243-3...................................................    9000-0026
52.243-4...................................................    9000-0026
52.243-6...................................................    9000-0026
52.243-7...................................................    9000-0026
52.245-2...................................................    9000-0075
52.245-3...................................................    9000-0075
52.245-5...................................................    9000-0075
52.245-7...................................................    9000-0075
52.245-8...................................................    9000-0075
52.245-9...................................................    9000-0075
52.245-10..................................................    9000-0075
52.245-11..................................................    9000-0075
52.245-16..................................................    9000-0075
52.245-17..................................................    9000-0075
52.245-18..................................................    9000-0075
52.246-2...................................................    9000-0077
52.246-3...................................................    9000-0077
52.246-4...................................................    9000-0077
52.246-5...................................................    9000-0077
52.246-6...................................................    9000-0077
52.246-7...................................................    9000-0077
52.246-8...................................................    9000-0077
52.246-10..................................................    9000-0077
52.246-12..................................................    9000-0077
52.246-15..................................................    9000-0077

[[Page 611]]

 
52.247-2...................................................    9000-0053
52.247-29..................................................    9000-0061
52.247-30..................................................    9000-0061
52.247-31..................................................    9000-0061
52.247-32..................................................    9000-0061
52.247-33..................................................    9000-0061
52.247-34..................................................    9000-0061
52.247-35..................................................    9000-0061
52.247-36..................................................    9000-0061
52.247-37..................................................    9000-0061
52.247-38..................................................    9000-0061
52.247-39..................................................    9000-0061
52.247-40..................................................    9000-0061
52.247-41..................................................    9000-0061
52.247-42..................................................    9000-0061
52.247-43..................................................    9000-0061
52.247-44..................................................    9000-0061
52.247-48..................................................    9000-0061
52.247-51..................................................    9000-0057
52.247-53..................................................    9000-0055
52.247-57..................................................    9000-0061
52.247-63..................................................    9000-0054
52.247-64..................................................    9000-0061
52.248-1...................................................    9000-0027
52.248-2...................................................    9000-0027
52.248-3...................................................    9000-0027
52.249-2...................................................    9000-0028
52.249-3...................................................    9000-0028
52.249-5...................................................    9000-0028
52.249-6...................................................    9000-0028
52.249-11..................................................    9000-0028
52.250-1...................................................    9000-0029
53.236-1(a)................................................    9000-0037
SF 24......................................................    9000-0045
SF 25......................................................    9000-0045
SF 25-A....................................................    9000-0045
SF 28......................................................    9000-0001
SF 34......................................................    9000-0045
SF 35......................................................    9000-0045
SF 254.....................................................    9000-0004
SF 255.....................................................    9000-0005
SF 273.....................................................    9000-0045
SF 274.....................................................    9000-0045
SF 275.....................................................    9000-0045
SF 294.....................................................    9000-0006
SF 295.....................................................    9000-0007
SF 312.....................................................    9000-0150
SF 1403....................................................    9000-0011
SF 1404....................................................    9000-0011
SF 1405....................................................    9000-0011
SF 1406....................................................    9000-0011
SF 1407....................................................    9000-0011
SF 1408....................................................    9000-0011
SF 1413....................................................    9000-0014
SF 1416....................................................    9000-0045
SF 1417....................................................    9000-0037
SF 1418....................................................    9000-0045
SF 1423....................................................    9000-0015
SF 1424....................................................    9000-0015
SF 1426....................................................    9000-0015
SF 1427....................................................    9000-0015
SF 1428....................................................    9000-0015
SF 1429....................................................    9000-0015
SF 1430....................................................    9000-0015
SF 1431....................................................    9000-0015
SF 1432....................................................    9000-0015
SF 1433....................................................    9000-0015
SF 1434....................................................    9000-0015
SF 1435....................................................    9000-0012
SF 1436....................................................    9000-0012
SF 1437....................................................    9000-0012
SF 1438....................................................    9000-0012
SF 1439....................................................    9000-0012
SF 1440....................................................    9000-0012
SF 1443....................................................    9000-0010
SF 1444....................................................    9000-0089
SF 1445....................................................    9000-0089
SF 1446....................................................    9000-0089
------------------------------------------------------------------------


[59 FR 67065, Dec. 28, 1994. Redesignated at 60 FR 34733, 34736, July 3, 
1995, as amended at 60 FR 42650, 42665, Aug. 16, 1995; 60 FR 48211, 
Sept. 18, 1995; 60 FR 49710, Sept. 26, 1995; 61 FR 18916, Apr. 29, 1996; 
61 FR 39188, July 26, 1996; 61 FR 67410, 67430, Dec. 20, 1996; 61 FR 
69287, Dec. 31, 1996; 62 FR 227, 235, 271, Jan. 2, 1997; 62 FR 44806, 
44810, Aug. 22, 1997; 62 FR 51229, 51270, Sept. 30, 1997; 63 FR 9050, 
9051, Feb. 23, 1998; 63 FR 35720, June 30, 1998; 63 FR 36121, July 1, 
1998; 63 FR 58602, Oct. 30, 1998; 63 FR 70292, Dec. 18, 1998; 64 FR 
10532, 10549, Mar. 4, 1999; 64 FR 32748, June 17, 1999; 64 FR 51850, 
Sept. 24, 1999; 64 FR 72416, 72417, Dec. 27, 1999; 65 FR 16286, Mar. 27, 
2000; 66 FR 53480, Oct. 22, 2001; 67 FR 13050, Mar. 20, 2002; 68 FR 
43856, July 24, 2003; 68 FR 56672, Oct. 1, 2003]

[[Page 613]]



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, 
2001, 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, 2001, see the ``List of CFR Sections 
Affected, 1973-1985, and 1986-2000,'' published in eight separate 
volumes.

                                  2001

48 CFR
                                                                   66 FR
                                                                    Page
52.101 (a) amended..................................................2134
    Regulation at 66 FR 2134 eff. date delayed.....................14260
52.202-1 Amended; introductory text revised.........................2134
    Regulation at 66 FR 2134 eff. date delayed.....................14260
    Clause amended.................................................53484
52.208-9 Heading revised; clause amended...........................65368
52.209-5 Amended; interim..........................................17756
    (a)(1)(i)(D) corrected.........................................18735
    Regulation at 65 FR 80265 and 66 FR 17756 stay terminated......66985
    Clause amended..........................................66990, 66986
52.212-1 Regulation at 65 FR 46058 confirmed.......................65370
52.212-3 Amended..............................................2134, 5348
    Regulation at 66 FR 2134 eff. date delayed.....................14260
    Amended; interim...............................................17756
    Corrected......................................................18735
    Regulation at 65 FR 46058 confirmed............................65370
    Regulation at 65 FR 80266 and 66 FR 17756 stay terminated......66985
    Clause amended..........................................66990, 66986
52.212-4 Amended...............................2139, 53485, 65360, 43514
52.212-5 Amended.............................................5348, 53489
    Amended; interim...............................................27417
52.213-4 Amended................................2140, 5348, 53489, 65360
52.214-21 Amended...................................................2135
    Regulation at 66 FR 2135 eff. date delayed.....................14260
52.215-1 Amended....................................................2135
    Regulation at 66 FR 2135 eff. date delayed.....................14260
52.216-7 Amended...................................................65360
52.216-13 Amended..................................................65361
52.219-1 Amended....................................................2135
    Regulation at 66 FR 2135 eff. date delayed.....................14260
    Regulation at 65 FR 46058 confirmed............................65370
52.219-9 Amended; interim..........................................53493
    Regulation at 65 FR 46058 confirmed............................65370
52.219-10 Amended; interim.........................................53493
52.219-19 Regulation at 65 FR 46058 confirmed......................65370
52.219-23 Amended...................................................2135
    Regulation at 66 FR 2135 eff. date delayed.....................14260
52.219-24 Regulation at 65 FR 46058 confirmed......................65370
52.219-26 Regulation at 65 FR 46058 confirmed......................65370
52.222-18 Added.....................................................5349
52.222-19 Added.....................................................5349
    Amended........................................................65371
52.222-30 Added....................................................53482
52.222-31 Added....................................................53482
52.222-32 Added....................................................53482
52.222-35 Revised..................................................53490
52.222-37 Revised..................................................53491
52.222-38 Added....................................................53491
52.222-50 Removed; interim.........................................27417
52.223-6 Amended....................................................2135
    Regulation at 66 FR 2135 eff. date delayed.....................14260
52.223-11 Amended...................................................2135
    Regulation at 66 FR 2135 eff. date delayed.....................14260

[[Page 614]]

52.223-13 Regulation at 65 FR 46058 confirmed......................65370
52.223-14 Regulation at 65 FR 46058 confirmed......................65370
52.225-1 Amended...................................................65350
52.225-3 Amended...................................................65350
52.225-5 Amended............................................65350, 65371
52.225-9 Amended...................................................65350
52.225-11 Amended....................................65351, 65371, 43520
52.226-2 Revised....................................................2135
    Regulation at 66 FR 2135 eff. date delayed.....................14260
52.230-1 Regulation at 65 FR 36030 confirmed........................2137
52.232-7 Clause amended; Alternate II revised......................65361
52.232-8 Clause amended............................................65361
52.232-12 Amended...................................................2138
52.232-16 Clause and Alternate III amended; Alternate II revised 
                                                                   65361
52.232-25 Amended...................................................2135
    Regulation at 66 FR 2135 eff. date delayed.....................14260
    Alternate I added; interim.....................................53486
    Revised........................................................65361
52.232-26 Amended...................................................2135
    Regulation at 66 FR 2135 eff. date delayed.....................14260
    Revised........................................................65361
52.232-27 Amended...................................................2135
    Regulation at 66 FR 2135 eff. date delayed.....................14260
    Revised........................................................65361
52.232-29 Amended..................................................65366
52.232-32 Amended..................................................65367
52.242-3 Amended....................................................2135
    Regulation at 66 FR 2135 eff. date delayed.....................14260
52.244-6 Amended; heading revised...................................2140
52.246-3 Amended.............................................2135, 53491
    Regulation at 66 FR 2135 eff. date delayed.....................14260
52.246-6 Amended....................................................2135
    Regulation at 66 FR 2135 eff. date delayed.....................14260
52.246-8 Amended....................................................2135
    Regulation at 66 FR 2135 eff. date delayed.....................14260
52.246-17 Amended; introductory text revised........................2135
    Regulation at 66 FR 2135 eff. date delayed.....................14260
52.246-18 Amended; introductory text revised........................2136
    Regulation at 66 FR 2136 eff. date delayed.....................14260
52.246-19 Amended; introductory text revised........................2136
    Regulation at 66 FR 2136 eff. date delayed.....................14260
52.246-20 Amended; introductory text revised........................2136
    Regulation at 66 FR 2136 eff. date delayed.....................14260
52.247-51 Amended...................................................2141
53.204-2 Regulation at 65 FR 46058 confirmed.......................65370
53.215-1 (a), (e) and (f) amended...................................2141
53.219 Clause amended; interim.....................................53493
    Regulation at 65 FR 46058 confirmed............................65370
53.301-279 Regulation at 65 FR 46058 confirmed.....................65370
53.301-294 Revised; interim........................................53494
53.301-295 Revised; interim........................................53494

                                  2002

48 CFR
                                                                   67 FR
                                                                    Page
Chapter 1
Chapter Summary disposition........................................43512
    Federal Acquisition Circular 2001-04............................6112
    Small entity compliance guide......6121, 10529, 13068, 21539, 43521, 
                                                                   56126
    Federal Acquisition Circular 2001-06...........................13048
    Federal Acquisition Circular 2001-07...........................21532
    Federal Acquisition Circular 2001-09...........................56116
    Technical correction...........................................46710
52.202-1 Alternate I amended.......................................43520
52.203-8 Introductory text amended.................................13063
52.208-8 Text and clause heading revised...........................13064
52.208-9 Amended...................................................56120
52.212-3 Clause and Alternate I amended.............................6121
    Clause and Alternate I amended; Alternate III removed..........13066
    Clause amended..........................................21536, 43520
    Regulation at 65 FR 60545 confirmed............................56122
52.212-5 Regulation at 66 FR 27417 confirmed........................6116
    Clause amended.................................................21536

[[Page 615]]

52.213-4 Clause amended.................6121, 13067, 21536, 43514, 56124
    Corrected......................................................47635
52.214-1 Removed...................................................13056
52.214-3 Amended...................................................13056
52.214-4 Amended...................................................13056
52.214-20 Introductory text revised; clause, Alternate I and II 
        amended....................................................13056
    Alternates I and II amended....................................21538
52.214-21 Revised..................................................13057
52.216-7 Clause amended......................................6119, 70521
52.216-26 Clause amended...........................................70521
52.219-1 Alternate I removed; Alternate II redesignated as 
        Alternate I; clause and new Alternate I amended............13066
    Regulation at 65 FR 60546 confirmed............................56122
52.219-8 Regulation at 65 FR 60546 confirmed.......................56122
52.219-9 Clause amended.............................................1858
    Regulations at 65 FR 60547, 66 FR 53493 and 67 FR 1858 
confirmed..........................................................56122
52.219-10 Regulations at 65 FR 60547 and 66 FR 53493 confirmed.....56122
52.219-19 Introductory text amended................................13068
52.219-20 Introductory text amended................................13068
52.219-21 Amended...................................................6121
52.222-19 Clause amended...........................................56124
52.222-26 Clause amended...........................................13067
52.222-44 Clause amended............................................6121
52.222-50 Regulation at 66 FR 27417 confirmed.......................6116
52.225-1 Heading revised; clause amended...........................21536
52.225-2 Heading revised; clause amended...........................21536
52.225-3 Heading revised; clause amended...........................21536
52.225-4 Amended...................................................21537
52.225-5 Amended; interim...........................................6118
    Clause amended.................................................70520
52.225-6 Amended...................................................21537
52.225-9 Heading revised; clause amended...........................21537
52.225-10 Heading revised; clause amended..........................21537
52.225-11 Heading revised; clause amended..........................21537
    Clause amended.................................................43520
52.225-12 Heading revised; clause amended..........................21537
52.232-5 Clause amended............................................56126
    Corrected......................................................57635
52.232-7 Clause amended............................................70521
52.232-16 Clause amended....................................56126, 70521
52.232-18 Introductory text revised................................13054
52.233-1 Clause amended............................................43514
52.244-6 Clause corrected; CFR correction...........................3441
    Clause amended.................................................21539
53.212 Amended.....................................................13050
53.213 (a) and (f) introductory text amended.......................13050
53.219 Regulations at 65 FR 60548 and 66 FR 53493 confirmed........56122
53.301-294 Regulations at 65 FR 60548 and 66 FR 53494 confirmed....56122
53.301-295 Regulations at 65 FR 60548 and 66 FR 53494 confirmed....56122
53.301-1449 Revised................................................13050

                                  2003

  (Regulations published from January 1, 2003, through October 1, 2003)

48 CFR
                                                                   67 FR
                                                                    Page
Chapter 1
52 Authority citation revised.........28079, 28091, 28097, 28098, 43856, 
                         43865, 43869, 43874, 56672, 56683, 56684, 56686
52.202-1 Regulation at 66 FR 53484 confirmed.......................28093
52.203-12 Clause amended...........................................28084
52.204-6 Revised...................................................56674
52.204-7 Added.....................................................56674
52.212-1 Clause amended.....................................43875, 56675
52.212-3 Clause amended............................................28084
52.212-4 Regulation at 66 FR 53485 confirmed.......................28093
    Clause amended.................................................56675
    Clause amended eff. 10-31-03...................................56683
52.212-5 Clause amended..............................13203, 28097, 56675
    Clause amended; eff. 10-31-03...........................56685, 56686
52.213-4 Clause amended................13203, 28084, 28098, 43870, 56675
    Regulation at 68 FR 28098 eff. date corrected..................32170
    Clause amended; eff. 10-31-03....................56675, 56684, 56686

[[Page 616]]

52.214-9 Removed...................................................43857
52.214-10 Amended..................................................43857
52.215-16 Clause amended...........................................28092
52.219-5 Clause amended............................................28085
52.219-6 Clause amended............................................28085
52.219-7 Clause amended............................................28085
52.219-18 Clause amended...........................................28085
52.219-23 Clause amended...........................................28085
52.222-3 Revised...................................................28085
52.222-29 Revised..................................................28085
52.223-5 Revised...................................................43870
52.223-13 Clause amended...........................................28086
    Introductory text revised; clause amended......................43870
52.223-14 Clause amended...........................................28086
    Introductory text revised; clause amended......................43870
52.225-1 Clause amended............................................28086
52.225-2 Clause amended............................................28086
52.225-3 Clause amended............................................28086
52.225-4 Clause amended............................................28086
52.225-5 Clause amended............................................28086
    Clause amended eff. 10-31-03...................................56685
52.225-9 Clause amended............................................28086
52.225-11 Clause amended...........................................28086
52.225-13 Clause amended...........................................28086
    Clause amended; eff. 10-31-03..................................56686
52.228-3 Introductory text revised.................................28086
52.228-4 Introductory text revised.................................28086
52.229-1 Introductory text revised.................................28086
52.229-3 Clause amended............................................13205
52.229-4 Heading and introductory text revised; clause amended.....13205
52.229-5 Removed...................................................13205
52.229-6 Clause amended............................................28087
52.229-10 Introductory text and clause amended.....................13205
52.232-16 Clause amended...........................................13208
52.232-25 Regulation at 68 FR 28093 eff. date corrected............33231
    Clause amended aff 10-31-03....................................56684
52.232-26 Clause amended eff. 10-31-03.............................56684
52.232-27 Clause amended eff. 10-31-03.............................56684
52.232-33 Clause amended...........................................56675
52.236-25 Revised..................................................28087
52.237-8 Clause amended............................................43867
52.237-9 Clause amended............................................43867
52.242-12 Revised..................................................28087
52.244-6 Heading revised; clause amended....................13204, 28098
    Regulation at 68 FR 28098 eff. date corrected..................32170
52.245-2 Clause amended............................................28087
52.245-4 Clause amended............................................28087
52.245-5 Clause amended............................................28087
52.245-11 Clause amended...........................................28087
52.245-15 Clause amended...........................................28087
52.246-17 Clause amended...........................................28087
52.247-47 Revised..................................................28088
52.247-55 Introductory text revised; clause amended................28088
52.247-63 Clause amended...........................................28088
52.247-64 Clause amended....................................13204, 28098
    Regulation at 68 FR 28098 eff. date corrected..................32170
53 Authority citation revised...............................28079, 43856
53.214 (e) removed.................................................43857
53.228 (e) amended.................................................28088
53.301-28 Revised..................................................28088
53.301-129 Removed.................................................43857


                                  [all]