[Federal Register Volume 59, Number 51 (Wednesday, March 16, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-5819]


[[Page Unknown]]

[Federal Register: March 16, 1994]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF DEFENSE

48 CFR Parts 245 and 252

 

Defense Federal Acquisition Regulation Supplement; 
Demilitarization

agency: Department of Defense (DoD).

action: Proposed rule with request for public comments.

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

summary: The Defense Acquisition Regulations Council is proposing 
changes to the Defense FAR Supplement (DFARS) to cover control of 
Munitions List items (MLI) and Strategic List items (SLI) and 
demilitarization of excess property.

dates: Comments on the proposed rule should be submitted to the address 
shown below on or before May 16, 1994 to be considered in the 
formulation of a final rule.

addresses: Interested parties should submit written comments to Defense 
Acquisition Regulations Directorate, Attn: IMD 3D139, OUSD (A&T), 3062 
Defense Pentagon, Washington, DC 20301-3062. FAX (703) 697-9845. Please 
cite DFARS Case 92-D024 in all correspondence related to this case.

for further information contact: Mr. Owen Green; (703) 697-7266.

SUPPLEMENTARY INFORMATION:

A. Background

    This proposed rule amends DFARS by adding a subsection at 245.604-
70 and a clause at 252.245-7XXX, and by revising 245.601, 245.604, 
245.610-4, and 245.7310-1 to improve control of Munitions List items 
(MLI) and Strategic List items (SLI) and demilitarization of excess 
contractor inventory. The proposed rule will require the Military 
Departments to determine whether Government property qualifies as MLI 
or SLI, to identify it as such in contracts and purchase orders, and to 
include specific demilitarization instructions in the contracts. The 
rule also specifies contractor responsibilities for demilitarizing or 
applying security trade controls over such property when applicable and 
requires contractors to include a demilitarization code with the item 
description on inventory schedules generated to report excess 
Government property. Furthermore, contractors are required to include 
such provisions in any subcontract that furnishes or supplies MLI or 
SLI to subcontractors, or that requires subcontractors to manufacture 
or produce MLI or SLI.

B. Regulatory Flexibility Act

    The Regulatory Flexibility Act applies, but the proposed rule is 
not expected to have a significant economic impact on a substantial 
number of small entities within the meaning of the Regulatory 
Flexibility Act, 5 U.S.C. 601, et seq., because the vast majority of 
property to be demilitarized, including MLI and SLI, is in the custody 
of large contractors. An initial Regulatory Flexibility Analysis (IRFA) 
has therefore not been performed. Comments are invited from small 
businesses and other interested parties. Comments from small entities 
concerning the affected DFARS Subparts will be considered in accordance 
with section 610 of the Act. Such comments must be submitted separately 
and should cite DAR Case 92-D024 in all correspondence.

C. Paperwork Reduction Act

    The Paperwork Reduction Act applies because the proposed rule 
imposes reporting and recordkeeping requirements which require the 
approval of OMB under 44 U.S.C. 3501, et seq. A request for clearance 
of the information collection has been submitted to OMB.

List of Subjects in 48 CFR Parts 245 and 252

    Government procurement.
Claudia L. Naugle,
Executive Editor, Defense Acquisition Regulations Directorate.

    Therefore it is proposed that 48 CFR parts 245 and 252 be amended 
as follows:
    1. The authority citation for 48 CFR parts 245 and 252 is revised 
to read as follows:

    Authority: 41 U.S.C. 421 and (FAR) 48 CFR part 1, subpart 1.3.

    2. Section 245.601 is amended by revising paragraph (2) to read as 
follows:


245.601  Definitions

* * * * *
    2. Demilitarization is defined in the clause at 252.245-7XXX, 
Demilitarization and Security Trade Controls.
* * * * *


245.604  [Amended]

    3. Section 245.604 is amended by removing paragraph (3) and 
redesignating paragraphs (4) and (5) as paragraphs (3) and (4).
    4. Section 245.604-70 is added to read as follows:


245.604-70  Demilitarization and security trade controls.

    (a) Contracting officers shall ensure that purchase requests 
include--
    (1) A statement that each item of Government property assigned a 
national stock number or nonstandard stock number to be furnished to a 
contractor under the resultant contract has been reviewed to determine 
whether it--
    (i) Appears on the U.S. Munitions List (DoD 4160.21-M-1, Appendix 
1); and/or
    (ii) Meets the criteria for a Munitions List item or Strategic List 
item; and
    (iii) Requires demilitarization and/or security trade controls.
    (2) Specific demilitarization instructions, if required, in 
accordance with Appendices 4 and 5 of DoD 4160.21-M-1, Defense 
Militarization Manual.
    (b) Contract clause. Use the clause at 252.245-7XXX, 
Demilitarization and Security Trade Controls, in solicitations and 
contracts for items that, if disposed of, would require 
demilitarization and/or security trade controls.
    5. Section 245.7310-1 is amended by revising paragraph (a) to read 
as follows:


245.7310-1  Demilitarization.

* * * * *
    (a) Demilitarization.
    Item(s) ________ require demilitarization by the Purchaser in the 
manner and to the degree set forth in the Defense Demilitarization 
Manual, DoD 4160.21-M-1.
* * * * *
    6. Section 252.245-7XXX is added to read as follows:


252.245-7XXX  Demilitarization and Security Trade Controls.

    As prescribed in 245.604-70(b), use the following clause:

Demilitarization and Security Trade Controls (XXX 1994)

    (a) Definitions.
    Demilitarization means the act of destroying the military 
offensive or defensive advantage inherent in certain types of 
equipment or material. The term includes mutilation, dumping at sea, 
cutting, crushing, scrapping, melting, burning or alteration 
designed to prevent the further use of this equipment and material 
for its originally intended military or lethal purpose and applies 
equally to material in unserviceable or serviceable condition, that 
has been screened through the Inventory Control Point (ICP) and 
declared surplus or foreign excess.
    Munitions List item means any item contained in the U.S. 
Munitions list (22 CFR part 121).
    Security trade controls means control procedures designed to 
preclude the sale or shipment of Munitions List or Strategic List 
property to any entity whose interests are inimical to those of the 
United States. These controls are also applicable to such other 
selected property as may be designated by the Deputy Under Secretary 
of Defense (Trade Security Policy).
    Strategic List item means an item assigned a code letter ``A'' 
or ``B'' following the export control classification number (ECCN) 
on the Commerce Control List, Supplement No. 1 to Sec. 799.1 of the 
Export Administration Regulations, Department of Commerce.
    (b) This contract requires the manufacture, assembly, test, 
maintenance, repair, and delivery of items that are, or include, 
Munitions List items or Strategic List items. The contract may also 
require the manufacture, assembly, test, maintenance, repair, 
delivery or use of special tooling, special test equipment, or plant 
equipment that is a Munitions List item or Strategic List item. When 
such items become excess to the needs of the Contractor in 
performing this contract, the Contractor shall--
    (1) Ensure a demilitarization code is included in the item 
description on inventory schedules generated to report the excess 
Government property, utilizing the guidelines provided in the 
Defense Demilitarization Manual, DoD 4160.21-M-1;
    (2) Demilitarize the items, as required; and
    (3) Apply security trade controls as required by the Arms Export 
Control Act and Export Administration Act of 1979.
    (c) The Contractor also shall include this clause, including 
this paragraph (c) in any subcontract issued under this contract 
that provides Munitions List items or Strategic List items to the 
subcontractor or requires the subcontractor to manufacture, 
assemble, test, maintain, repair, or deliver items that are or 
include Munitions List items or Strategic List items.

(End of clause)

[FR Doc. 94-5819 Filed 3-15-94; 8:45 am]
BILLING CODE 3810-01-M