[Federal Register Volume 60, Number 180 (Monday, September 18, 1995)]
[Rules and Regulations]
[Pages 48258-48272]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-22780]



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


DEPARTMENT OF DEFENSE
48 CFR Parts 4, 5, 6, 9, 14, 15, 16, 17, 19, 20, 25, 26, 42, 44, 52 
and 53

[FAC 90-32; FAR Case 94-780; Item V]
RIN 9000-AG37


Federal Acquisition Regulation; Small Business

AGENCIES: Department of Defense (DOD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Final rule.

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

SUMMARY: The Federal Acquisition Regulatory Council has agreed on a 
final rule to amend the Federal Acquisition Regulation (FAR) to 
implement sections 7101(a) and 7106 and to augment regulation 
implementation of Section 10004 of the Federal Acquisition Streamlining 
Act of 1994 (Pub. L. 103-355), dated October 13, 1994. Section 7101(a) 
of FASA deletes sections 15(e) and (f) from the Small Business Act. 
Those sections established the priority for award of set-asides and 
provided the statutory basis for a procurement preference for concerns 
located in Labor Surplus Areas (LSA). Based on this deletion, this rule 
removes the LSA set-aside program and LSA subcontracting program from 
the FAR.
    Section 7106 of FASA revises sections 8 and 15 of the Small 
Business Act to accommodate a Governmentwide goal of 5 percent for 
women-owned small businesses. This rule deletes existing, separate 
coverage relating to women-owned businesses and revises existing 
coverage to place women-owned small businesses on an equal footing with 
small disadvantaged businesses. In connection with this revision, the 
Standard Forms 294 and 295 are revised and streamlined.
    Section 10004 of FASA, which requires the collection of specified 
data through the Federal Procurement Data System, is being implemented 
by FAR case 94-701. This rule augments that coverage by providing a 
solicitation provision to collect the information on women-owned 
businesses as required by that FAR case.
    This regulatory action was subject to Office of Management and 
Budget review under Executive Order 12866, dated September 30, 1993.

EFFECTIVE DATE: October 1, 1995.

FOR FURTHER INFORMATION CONTACT: Ms. Victoria Moss, Small Business Team 
Leader, at (202) 501-4764 in reference to this FAR case. For general 
information, contact the FAR Secretariat, Room 4037, GS Building, 
Washington, DC 20405 (202) 501-4755. Please cite FAC 90-32, FAR case 
94-780.

SUPPLEMENTARY INFORMATION:

A. Background

    The Federal Acquisition Streamlining Act of 1994 (the Act), Pub. L. 
103-355, provides authorities that streamline the acquisition process 
and minimize burdensome Government-unique requirements. The following 
sections of the Federal Acquisition Streamlining Act are implemented by 
this final rule:
    Section 7101, Repeal of Certain Requirements, paragraph (a), 
deletes sections 15(e) and (f) from the Small Business Act. These 
sections established the priority for the award of contracts and 
subcontracts in carrying out the set-aside programs.
    Section 7106, Procurement Goals for Small Business Concerns Owned 
by Women, establishes a Governmentwide goal for participation by women-
owned small business concerns in prime and subcontracts and revises 
sections 8 and 15 of the Small Business Act to accommodate the goal.
    Section 10004, Data Collection through the Federal Procurement Data 
System, has been implemented in FAR case 94-701. This rule augments 
that implementation.
    These sections are implemented in this final rule by way of the 
following substantial changes:
    Elimination of the Labor Surplus Area (LSA) set-aside program;
    Development of coverage giving women-owned small businesses equal 
standing with small and small disadvantaged business in subcontracting 
plans;
    Issuance of an abbreviated provision to allow firms to represent 
their status as small, small disadvantaged and/or women-owned small 
business in one place;
    Simplification and streamlining of the Standard Form (SF) 294, 
Subcontract for Individual Contracts, and SF 295, Summary Subcontract 
Report;
    Inclusion of a solicitation provision collecting information on 
women-owned businesses.

[[Page 48259]]


B. Regulatory Flexibility Act

    The changes may 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 rule requires large 
business contractors to submit and negotiate a subcontracting plan 
addressing subcontracting with women-owned small businesses. The rule 
further provides for imposition of liquidated damages on those firms 
which do not make a good faith effort to comply with that 
subcontracting plan. A Final Regulatory Flexibility Analysis (FRFA) has 
been prepared and will be provided to the Chief Counsel for Advocacy 
for the Small Business Administration. A copy of the FRFA may be 
obtained from the FAR Secretariat.

C. Paperwork Reduction Act

    The Paperwork Reduction Act (Pub. L. 96-511) applies because the 
final rule contains information collection requirements. Requests for 
approval of the revised information collection requirements concerning 
OMB Control Numbers 9000-0006, Subcontracting Plans/Subcontracting 
Report for Individual Contracts, and 9000-0007, Summary Subcontract 
Report, were submitted to the Office of Management and Budget under 44 
U.S.C. 3501, et seq. The information collections were approved through 
March 31, 1998. Public comments concerning this request were invited 
through a Federal Register notice published on January 6, 1995. Based 
on the comments received concerning these information collection 
requirements, substantial changes were made to SFs 294 and 295. The 
most significant changes include removal of blocks which collect 
information not essential to program management, changing the reporting 
frequency for the SF 295 from quarterly to semi-annually (DOD only), 
removing signature blocks from the SF 294 (to facilitate electronic 
submittal) and clarifying the instructions on the reverse.

D. Public Comments

    On January 6, 1995, a proposed rule was published in the Federal 
Register (60 FR 2302). In response to the notice of proposed 
rulemaking, 114 public comments were received. In order to more 
effectively implement those sections of the Act addressed in the 
proposed rule, the proposed rule has been divided into distinguishable 
segments. Section 4004, Small Business Reservation, has been added to 
FAR Case 94-770. Section 7102, Contracting Program for Certain Small 
Business Concerns, remains under consideration in light of the Supreme 
Court's recent decision in Adarand Constructors, Inc. v. Pena, 115 S. 
Ct. 2097 (1995), which set forth a new standard for evaluating the 
constitutionality of race-based affirmative action programs, and the 
President's directive of July 19, 1995, that executive agencies review 
such programs under that standard. Section 7102 has been assigned FAR 
case 94-781. The comments of all respondents were considered in 
developing this final rule. As a result, the following changes have 
been made:
    Requirements for acquisition plans were revised to include 
consideration of women-owned small business concerns.
    Use of the provision entitled ``Priority for Labor Surplus Area 
Concerns'' was limited to sealed bids.
    The Standard Forms 294 and 295 were simplified and streamlined.

List of Subjects in 48 CFR Parts 4, 5, 6, 9, 14, 15, 16, 17, 19, 20, 
25, 26, 42, 44, 52 and 53

    Government procurement.

    Dated: September 7, 1995.
Edward C. Loeb,
Deputy Project Manager for the Implementation of the Federal 
Acquisition Streamlining Act of 1994.

    Therefore, 48 CFR Parts 4, 5, 6, 9, 14, 15, 16, 17, 19, 20, 25, 26, 
42, 44, 52 and 53 are amended as set forth below:
    1. The authority citation for 48 CFR Parts 4, 5, 6, 9, 14, 15, 16, 
17, 19, 20, 25, 26, 42, 44, 52 and 53 continues to read as follows:

    Authority: 40 U.S.C. 486(c); 10 U.S.C. chapter 137; and 42 
U.S.C. 2473(c).

PART 4--ADMINISTRATIVE MATTERS

    2. Section 4.602 is amended by revising paragraph (a)(2) to read as 
follows:


4.602  Federal Procurement Data System.

    (a) * * *
    (2) A means of measuring and assessing the impact of Federal 
contracting on the Nation's economy and the extent to which small, 
small disadvantaged and women-owned small business concerns are sharing 
in Federal contracts; and
* * * * *
    3. Section 4.603 is added to read as follows:


4.603  Solicitation provision.

    The contracting officer shall insert the provision at 52.204-5, 
Women-Owned Business, in all solicitations that are not set aside for 
small business concerns and that exceed the simplified acquisition 
threshold in Part 13, when the contract is to be performed inside the 
United States, its territories or possessions, Puerto Rico, the Trust 
Territory of the Pacific Islands, or the District of Columbia.
PART 5--PUBLICIZING CONTRACT ACTIONS


5.002  [Amended]

    4. Section 5.002 is amended in paragraph (c) by removing ``labor 
surplus area'' and inserting ``women-owned small business'' in its 
place.


5.207  [Amended]

    5. Section 5.207 is amended in paragraph (c)(2)(xiii) by removing 
``and labor surplus area concerns'', and in paragraph (d) by removing 
``or labor surplus area (LSA)''.


5.404-1  [Amended]

    6. Section 5.404-1 is amended in paragraph (b)(6)(ii) by removing 
``or LSA''.
    7. Section 5.503 is amended by revising the second sentence of 
paragraph (a) to read as follows:


5.503  Procedures.

    (a) * * * Contracting officers shall give small, small 
disadvantaged and women-owned small business concerns maximum 
opportunity to participate in these acquisitions.
* * * * *

PART 6--COMPETITION REQUIREMENTS

    8. Section 6.203 is revised to read as follows:


6.203  Set-asides for small business concerns.

    (a) To fulfill the statutory requirements relating to small 
business concerns, contracting officers may set aside solicitations to 
allow only such business concerns to compete. This includes contract 
actions conducted under the Small Business Innovation Research Program 
established under Pub. L. 97-219.
    (b) No separate justification or determination and findings is 
required under this part to set aside a contract action for small 
business concerns.
    (c) Subpart 19.5 prescribes policies and procedures that shall be 
followed with respect to set-asides.


6.501  [Amended]

    9. Section 6.501 is amended in paragraph (c) by removing ``and 
disadvantaged''. 

[[Page 48260]]


PART 9--CONTRACTOR QUALIFICATIONS

    10. Section 9.104-3 is amended by revising the last sentence of 
paragraph (c) to read as follows:


9.104-3  Application of standards.

* * * * *
    (c) * * * If the pending contract requires a subcontracting plan 
pursuant to Subpart 19.7, Subcontracting with Small, Small 
Disadvantaged Business and Women-Owned Small Business Concerns, the 
contracting officer shall also consider the prospective contractor's 
compliance with subcontracting plans under recent contracts.
* * * * *

PART 14--SEALED BIDDING


14.205-1  [Amended]

    11. Section 14.205-1(e) is amended in the last sentence after the 
word ``Disadvantaged'' by inserting ``and women-owned''.


14.205-4  [Amended]

    12. Section 14.205-4 is amended in the fourth sentence of paragraph 
(b) by inserting after the word ``small'' the phrase ``, small 
disadvantaged and women-owned small''; and removing ``and labor surplus 
areas (see 20.104(e) and (f))''; and in the last sentence of paragraph 
(b) by removing ``parts 19 and 20'' and inserting in its place ``part 
19''.
    13. Section 14.206 is revised to read as follows:


14.206  Small business set-asides.

(See Part 19.)


14.408-6  [Amended]

    14. Section 14.408-6 is amended by removing paragraph (a)(3) and 
redesignating paragraph (a)(4) as paragraph (a)(3).


14.502  [Amended]

    15. Section 14.502(b)(3) is amended by removing the text following 
the word ``business'' and inserting in its place ``set-aside (see 
19.502-2).''

PART 15--CONTRACTING BY NEGOTIATION


15.705  [Amended]

    16. Section 15.705 is amended in paragraph (b) by removing 
``business and labor surplus area'' and inserting in its place ``, 
small disadvantaged and women-owned small business''.


15.706  [Amended]

    17. Section 15.706 is amended at the end of the first sentence of 
paragraph (b) by removing ``and disadvantaged business utilization'' 
and inserting in its place ``business''; and in paragraph (d)(4) by 
removing ``labor surplus area'' and inserting in its place ``women-
owned small business''.


15.905-1  [Amended]

    18. Section 15.905-1 is amended in the first sentence of paragraph 
(c) by inserting after the word ``individuals,'' the phrase ``women-
owned small businesses,''; and removing the phrase ``labor surplus 
areas,''.

PART 16--TYPES OF CONTRACTS


16.103  [Amended]

    19. Section 16.103 is amended in paragraph (d)(3) by removing the 
words ``or labor surplus area concerns''.


16.505  [Amended]

    20. Section 16.505 is amended in paragraphs (d)(4) and (d)(5)(ii) 
by removing the phrase ``or labor surplus area''.

PART 17--SPECIAL CONTRACTING METHODS


17.104-1  [Amended]

    21. Section 17.104-1 is amended--
    a. In paragraph (a) by removing the phrase ``or labor surplus 
area'',
    b. In paragraph (b) by removing the phrase ``or labor surplus 
area''; and
    c. In paragraph (b)(2) by removing ``(Partial labor surplus area 
set-asides are only authorized for DOD activities at this time.)''.
PART 19--SMALL BUSINESS PROGRAMS

    22. The heading of Part 19 is revised to read as set forth above.
* * * * *
    23. Section 19.001 is amended by adding, in alphabetical order, the 
definitions Labor surplus area, Labor surplus area concern, and Women-
owned small business concern to read as follows:


19.001   Definitions.

* * * * *
    Labor surplus area means a geographical area identified by the 
Department of Labor in accordance with 20 CFR Part 654, Subpart A, as 
an area of concentrated unemployment or underemployment or an area of 
labor surplus.
    Labor surplus area concern means a concern that together with its 
first-tier subcontractors will perform substantially in labor surplus 
areas. Performance is substantially in labor surplus areas if the costs 
incurred under the contract on account of manufacturing, production, or 
performance of appropriate services in labor surplus areas exceed 50 
percent of the contract price.
* * * * *
    Women-owned small business concern means a small business concern--
    (a) 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 the 
stock of which is owned by one or more women; and
    (b) Whose management and daily business operations are controlled 
by one or more women.
    24. Section 19.201 is amended by revising paragraphs (a), (b), 
(c)(9), and (d) to read as follows:


19.201   General policy.

    (a) It is the policy of the Government to provide maximum 
practicable opportunities in its acquisitions to small business 
concerns, small disadvantaged business concerns, and women-owned small 
business concerns. Such concerns shall also have the maximum 
practicable opportunity to participate as subcontractors in the 
contracts awarded by any executive agency, consistent with efficient 
contract performance. The Small Business Administration (SBA) counsels 
and assists small business concerns and assists contracting personnel 
to ensure that a fair proportion of contracts for supplies and services 
is placed with small business.
    (b) Heads of contracting activities are responsible for effectively 
implementing the small business programs within their activities, 
including achieving program goals. They are to ensure that contracting 
and technical personnel maintain knowledge of small, small 
disadvantaged and women-owned small business program requirements and 
take all reasonable action to increase participation in their 
activities' contracting processes by these businesses.
    (c) * * *
    (9) Make recommendations in accordance with agency regulations as 
to whether a particular acquisition should be awarded under Subpart 
19.5 as a set-aside, or under Subpart 19.8 as a Section 8(a) award.
    (d) Small Business Specialists shall be appointed and act in 
accordance with agency regulations.
    25. Section 19.202 is amended by revising the first sentence to 
read as follows:


19.202   Specific policies.

    In order to further the policy in 19.201(a), contracting officers 
shall comply with the specific policies listed 

[[Page 48261]]
in this section and shall consider recommendations of the agency 
Director of Small and Disadvantaged Business Utilization, or the 
Director's designee, as to whether a particular acquisition should be 
awarded under Subpart 19.5 or 19.8. * * *
    26. Section 19.202-3 is revised to read as follows:


19.202-3   Equal low bids.

    In the event of equal low bids (see 14.408-6), awards shall be made 
first to small business concerns which are also labor surplus area 
concerns, and second to small business concerns which are not also 
labor surplus area concerns.
    27. Section 19.202-5 is amended by revising paragraphs (a) and (b) 
to read as follows:


19.202-5   Data collection and reporting requirements.

* * * * *
    (a) Require each prospective contractor to represent whether it is 
a small business, small disadvantaged business or women-owned small 
business (see the provision at 52.219-1, Small Business Program 
Representations).
    (b) Accurately measure the extent of participation by small, small 
disadvantaged, and women-owned small businesses in Government 
acquisitions in terms of the total value of contracts placed during 
each fiscal year, and report data to the SBA at the end of each fiscal 
year (see Subpart 4.6).
* * * * *
    28. Section 19.301 is amended by revising the first sentence of 
paragraph (d) to read as follows:


19.301   Representation by the offeror.

    (d) If the SBA determines that the status of a concern as a ``small 
business,'' a ``small disadvantaged business'' or a ``women-owned small 
business'' has been misrepresented in order to obtain a set-aside 
contract, an 8(a) subcontract, a subcontract that is to be included as 
part or all of a goal contained in a subcontracting plan, or a prime or 
subcontract to be awarded as a result, or in furtherance of any other 
provision of Federal law that specifically references Section 8(d) of 
the Small Business Act for a definition of program eligibility, the SBA 
may take action as specified in Section 16(d) of the Act. * * *
* * * * *
    29. Section 19.304 is revised to read as follows:


19.304   Solicitation provision and contract clause.

    (a) The contracting officer shall insert the provision at 52.219-1, 
Small Business Program Representations, in solicitations exceeding the 
micro-purchase threshold when the contract is to be performed inside 
the United States, its territories or possessions, Puerto Rico, the 
Trust Territory of the Pacific Islands, or the District of Columbia.
    (b) When contracting by sealed bidding, the contracting officer 
shall insert the provision at 52.219-2, Equal Low Bids, in 
solicitations and contracts when the contract is to be performed inside 
the United States, its territories or possessions, Puerto Rico, the 
Trust Territory of the Pacific Islands, or the District of Columbia.


19.401   [Amended]

    30. Section 19.401 is amended in paragraph (a) by removing the 
phrase ``and small disadvantaged business''.
    31. Section 19.402 is amended by revising paragraph (c)(1)(ii) to 
read as follows:


19.402   Small Business Administration procurement center 
representatives.

* * * * *
    (c) * * *
    (1) * * *
    (ii) New qualified small, small disadvantaged and women-owned small 
business sources, and
* * * * *
    32. Section 19.501 is amended in the third sentence of paragraph 
(a) by removing ``or, except for the Department of Defense, restricted 
to small businesses located in labor surplus areas''; and by revising 
the first sentence of paragraph (h) to read as follows:


19.501   General.

* * * * *
    (h) Section 305 of Public Law 103-403 authorizes public and private 
organizations for the handicapped to participate for fiscal year 1995 
in acquisitions set-aside for small business concerns. * * *
* * * * *


19.504   [Reserved]

    33. Section 19.504 is removed and reserved.
    34. Section 19.505 is revised to read as follows:


19.505   Rejecting Small Business Administration recommendations.

    (a) If the contracting officer rejects a recommendation of the SBA 
procurement center representative or breakout procurement center 
representative, written notice shall be furnished to the appropriate 
SBA center representative within 5 working days of the contracting 
officer's receipt of the recommendation.
    (b) The SBA procurement center representative may appeal the 
contracting officer's rejection to the head of the contracting activity 
(or designee) within 2 working days after receiving the notice. The 
head of the contracting activity (or designee) shall render a decision 
in writing, and provide it to the SBA representative within 7 working 
days. Pending issuance of a decision to the SBA procurement center 
representative, the contracting officer shall suspend action on the 
acquisition.
    (c) If the head of the contracting activity agrees that the 
contracting officer's rejection was appropriate, the SBA procurement 
center representative may--
    (1) Within 1 working day, request the contracting officer to 
suspend action on the acquisition until the SBA Administrator appeals 
to the agency head (see paragraph (f) of this section); and
    (2) The SBA shall be allowed 15 working days after making such a 
written request, within which the Administrator of SBA
    (i) May appeal to the Secretary of the Department concerned, and
    (ii) Shall notify the contracting officer whether the further 
appeal has, in fact, been taken.
If notification is not received by the contracting officer within the 
15-day period, it shall be deemed that the SBA request to suspend 
contracting action has been withdrawn and that an appeal to the 
Secretary was not taken.
    (d) When the contracting officer has been notified within the 15-
day period that the SBA has appealed to the agency head, the head of 
the contracting activity (or designee) shall forward justification for 
its decision to the agency head. The contracting officer shall suspend 
contract action until notification is received that the SBA appeal has 
been settled.
    (e) The agency head shall reply to the SBA within 30 working days 
after receiving the appeal. The decision of the agency head shall be 
final.
    (f) A request to suspend action on an acquisition need not be 
honored if the contracting officer determines that proceeding to 
contract award and performance is in the public interest. The 
contracting officer shall include in the contract file a statement of 
the facts justifying the determination, and shall promptly notify the 
SBA representative of the determination and provide a copy of the 
justification.
    35. Section 19.506 is revised to read as follows:

[[Page 48262]]



19.506   Withdrawing or modifying set-asides.

    (a) If, before award of a contract involving a set-aside, the 
contracting officer considers that award would be detrimental to the 
public interest, (e.g., payment of more than a fair market price), the 
contracting officer may withdraw the set-aside determination whether it 
was unilateral or joint. The contracting officer shall initiate a 
withdrawal of an individual set-aside by giving written notice to the 
agency small business specialist and the SBA procurement center 
representative, if one is assigned, stating the reasons. In a similar 
manner, the contracting officer may modify a unilateral or joint class 
set-aside to withdraw one or more individual acquisitions.
    (b) If the agency small business specialist does not agree to a 
withdrawal or modification, the case shall be promptly referred to the 
SBA representative (if one is assigned) for review. If an SBA 
representative is not assigned, disagreements between the agency small 
business specialist and the contracting officer shall be resolved using 
agency procedures. However, the procedures are not applicable to 
automatic dissolutions of set-asides (see 19.507) or dissolution of 
set-asides under $100,000.
    (c) The contracting officer shall prepare a written statement 
supporting any withdrawal or modification of a set-aside and include it 
in the contract file.


19.508   [Amended]

    36. Section 19.508 is amended by removing and reserving paragraph 
(b).

Subpart 19.7--Subcontracting With Small Business, Small 
Disadvantaged Business and Women-Owned Small Business Concerns

    37. The heading of Subpart 19.7 is revised to read as set forth 
above.
    38. Section 19.702 is amended by revising the introductory text and 
paragraph (b)(4) to read as follows:


19.702   Statutory requirements.

    Any contractor receiving a contract for more than the simplified 
acquisition threshold in Part 13 shall agree in the contract that small 
business concerns, small disadvantaged business concerns and women-
owned small business concerns shall have the maximum practicable 
opportunity to participate in contract performance consistent with its 
efficient performance. 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, small disadvantaged business concerns and 
women-owned small business concerns.
* * * * *
    (b) * * *
    (4) For modifications to contracts that do not contain the clause 
at 52.219-8, Utilization of Small, Small Disadvantaged and Women-Owned 
Small Business Concerns (or equivalent prior clauses).
* * * * *
    39. Section 19.703 is amended by revising paragraph (a) 
introductory text, (a)(1), and (b) to read as follows:


19.703   Eligibility requirements for participating in the program.

    (a) To be eligible as a subcontractor under the program, a concern 
must represent itself as a small business concern, small disadvantaged 
business concern or a woman-owned small business concern.
    (1) To represent itself as a small business concern or a women-
owned small business concern, a concern must meet the appropriate 
definition in 19.001.
* * * * *
    (b) A contractor acting in good faith may rely on the written 
representation of its subcontractor regarding the subcontractor's 
status. The contractor, the contracting officer, or any other 
interested party can challenge a subcontractor's size status 
representation by filing a protest, in accordance with 13 CFR 121.1601 
through 121.1608. Protests challenging a subcontractor's disadvantaged 
status representation shall be filed in accordance with 13 CFR 124.601 
through 124.610. Protests challenging a subcontractor's status as a 
women-owned small business concern shall be filed in accordance with 
Small Business Administration procedures.
    40. Section 19.704 is amended by revising paragraphs (a)(1), 
(a)(3), (a)(4), (a)(6), and (b) to read as follows:


19.704   Subcontracting plan requirements.

    (a) * * *
    (1) Separate percentage goals for using small business concerns, 
small disadvantaged business concerns and women-owned small business 
concerns as subcontractors;
* * * * *
    (3) A description of the efforts the offeror will make to ensure 
that small business concerns, small disadvantaged business concerns and 
women-owned small business concerns will have an equitable opportunity 
to compete for subcontracts;
    (4) Assurances that the offeror will include the clause at 52.219-
8, Utilization of Small, Small Disadvantaged and Women-Owned Small 
Business Concerns (see 19.708(b)), 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) to 
adopt a plan similar to the plan required by the clause at 52.219-9, 
Small, Small Disadvantaged and Women-Owned Small Business 
Subcontracting Plan (see 19.708(c));
* * * * *
    (6) A recitation of the types of records the offeror will maintain 
to demonstrate procedures 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, small 
disadvantaged and women-owned small business concerns and to award 
subcontracts to them.
    (b) Contractors may establish, on a plant or division-wide basis, a 
master subcontracting plan which contains all the elements required by 
the clause at 52.219-9, Small, Small Disadvantaged and Women-Owned 
Small Business Subcontracting Plan, except goals. Master plans shall be 
effective for a 1-year period after approval by the contracting 
officer; however, a master plan when incorporated in an individual plan 
shall apply to that contract throughout the life of the contract.
* * * * *


19.705-1  [Amended]

    41. Section 19.705-1 is amended in the first sentence by removing 
the phrase ``for Small and Small Disadvantaged Business Concerns''.


19.705-2  [Amended]

    42. Section 19.705-2 is amended in the first sentence of paragraph 
(d) introductory text by removing the words ``small business and small 
disadvantaged'' and inserting in their place, ``small, small 
disadvantaged and women-owned small''.
    43. Section 19.705-4 is amended by revising the last sentence of 
paragraph (b), the second and last sentences of paragraph (c); the 
first sentence of paragraphs (d)(1) and (d)(5); and paragraphs (d)(4) 
and (d)(6) to read as follows:


19.705-4  Reviewing the subcontracting plan.

* * * * *
    (b) * * * If the plan, although responsive, evidences the bidder's 
intention not to comply with its obligations under the clause at 
52.219-

[[Page 48263]]
8, Utilization of Small, Small Disadvantaged and Women-Owned Small 
Business Concerns, the contracting officer may find the bidder 
nonresponsible.
    (c) * * * Subcontracting goals should be set at a level that the 
parties reasonably expect can result from the offeror expending good 
faith efforts to use small, small disadvantaged and women-owned small 
business subcontractors to the maximum practicable extent. * * * An 
incentive subcontracting clause (see 52.219-10, Incentive 
Subcontracting Program), may be used when additional and unique 
contract effort, such as providing technical assistance, could 
significantly increase subcontract awards to small, small disadvantaged 
or women-owned small businesses.
    (d) * * *
    (1) Evaluate the offeror's past performance in awarding 
subcontracts for the same or similar products or services to small, 
small disadvantaged and women-owned small business concerns. * * *
* * * * *
    (4) Evaluate subcontracting potential, considering the offeror's 
make-or-buy policies or programs, the nature of the products or 
services to be subcontracted, the known availability of small, small 
disadvantaged and women-owned small business concerns in the 
geographical area where the work will be performed, and the potential 
contractor's long-standing contractual relationship with its suppliers.
    (5) Advise the offeror of available sources of information on 
potential small, small disadvantaged and women-owned small business 
subcontractors, as well as any specific concerns known to be potential 
subcontractors. * * *
    (6) Obtain advice and recommendations from the SBA procurement 
center representative (if any) and the agency small business 
specialist.


19.705-7  [Amended]

    44. Section 19.705-7 is amended--
    a. In the first sentence of paragraph (a) by removing the word 
``and'' the first time it appears and inserting a comma in its place; 
and adding the phrase ``and women-owned small'' after the word 
``disadvantaged'';
    b. In the third sentence of paragraph (d) by removing the words 
``business and'' and replacing them with a comma; and adding the phrase 
``and women-owned small'' after the word ``disadvantaged'';
    c. In the fourth sentence of paragraph (d) by removing the phrase 
``business or'' and inserting a comma in its place; and adding the 
phrase ``or woman-owned small'' after the word ``disadvantaged'';
    d. In paragraph (f) by removing the words ``Business and'' and 
replacing them with a comma; and adding the phrase ``and Women-Owned 
Small'' after the word ``Disadvantaged''.
    45. Section 19.706 is amended by revising paragraphs (a)(2) and 
(a)(3) to read as follows:


19.706  Responsibilities of the cognizant administrative contracting 
officer.

    (a) * * *
    (2) Information on the extent to which the contractor is meeting 
the plan's goals for subcontracting with eligible small, small 
disadvantaged and women-owned small business concerns;
    (3) Information on whether the contractor's efforts to ensure the 
participation of small, small disadvantaged and women-owned small 
business concerns are in accordance with its subcontracting plan;
* * * * *
    46. Section 19.708 is amended by revising paragraph (a) 
introductory text, (b) and (c) to read as follows:


19.708  Solicitation provisions and contract clauses.

    (a) The contracting officer shall insert the clause at 52.219-8, 
Utilization of Small, Small Disadvantaged and Women-Owned Small 
Business Concerns, in solicitations and contracts when the contract 
amount is expected to be over the simplified acquisition threshold in 
Part 13 unless--
* * * * *
    (b)(1) The contracting officer shall, when contracting by 
negotiation, insert the clause at 52.219-9, Small, Small Disadvantaged 
and Women-Owned Small Business Subcontracting Plan, in solicitations 
and contracts that
    (i) Offer subcontracting possibilities,
     (ii) Are expected to exceed $500,000 ($1,000,000 for construction 
of any public facility), and
    (iii) Are required to include the clause at 52.219-8, Utilization 
of Small, Small Disadvantaged and Women-Owned Small Business Concerns, 
unless the acquisition has been set aside or is to be accomplished 
under the 8(a) program.
When contracting by sealed bidding rather than by negotiation, the 
contracting officer shall use the clause with its Alternate I.
    (2) The contracting officer shall insert the clause at 52.219-16, 
Liquidated Damages--Subcontracting Plan, in all solicitations and 
contracts containing the clause at 52.219-9, Small, Small Disadvantaged 
and Women-Owned Small Business Subcontracting Plan, or its Alternate I.
    (c)(1) The contracting officer may, when contracting by 
negotiation, insert in solicitations and contracts a clause 
substantially the same as the clause at 52.219-10, Incentive 
Subcontracting Program, when a subcontracting plan is required (see 
19.702(a)(1)), and inclusion of a monetary incentive is, in the 
judgment of the contracting officer, necessary to increase 
subcontracting opportunities for small, small disadvantaged and women-
owned small business concerns, and is commensurate with the efficient 
and economical performance of the contract; unless the conditions in 
paragraph (c)(3) of this section are applicable. The contracting 
officer may vary the terms of the clause as specified in paragraph 
(c)(2) of this section.
    (2) Various approaches may be used in the development of small, 
small disadvantaged and women-owned small business concerns' 
subcontracting incentives. They can take many forms, from a fully 
quantified schedule of payments based on actual subcontract achievement 
to an award fee approach employing subjective evaluation criteria (see 
paragraph (c)(3) of this section). The incentive should not reward the 
contractor for results other than those that are attributable to the 
contractor's efforts under the incentive subcontracting program.
    (3) As specified in paragraph (c)(2) of this section, the 
contracting officer may include small, small disadvantaged and women-
owned small business subcontracting as one of the factors to be 
considered in determining the award fee in a cost-plus-award-fee 
contract; in such cases, however, the contracting officer shall not use 
the clause at 52.219-10, Incentive Subcontracting Program.


19.811-3  [Amended]

    47. Section 19.811-3(d)(3) is amended by removing the citation 
``19.502-2(b)'' and inserting ``19.502-2(c)'' in its place.

Subpart 19.9   [Remove and Reserved]

    48. Subpart 19.9, consisting of sections 19.901 and 19.902, is 
removed and reserved.

PART 20   [REMOVED AND RESERVED]

    49. Part 20 is removed and reserved.

PART 25--FOREIGN ACQUISITION


25.105  [Amended]

    50. Section 25.105 is amended in paragraph (a)(1) by removing the 
phrase ``that is not a labor surplus area concern''; and in paragraph 
(a)(2) by 

[[Page 48264]]
removing the phrase ``or any labor surplus area concern''.


25.404  [REMOVED AND RESERVED]

    51. Section 25.404 is removed and reserved.

PART 26--OTHER SOCIOECONOMIC PROGRAMS

    52. The Note to Part 26 is amended by removing ``20,''.


26.104  [Amended]

    53. Section 26.104 is amended in paragraphs (a) and (b) by removing 
``Business and'' and inserting a comma in its place; and inserting 
after the word ``Disadvantaged'' the phrase ``and Women-Owned Small''.

PART 42--CONTRACT ADMINISTRATION

    54. Section 42.302 is amended by revising paragraphs (a)(52) 
through (a)(55) to read as follows:
42.302  Contract administration functions.

* * * * *
    (a) * * *
    (52) Review, evaluate, and approve plant or division-wide small, 
small disadvantaged and women-owned small business master 
subcontracting plans.
    (53) Obtain the contractor's currently approved company- or 
division-wide plans for small, small disadvantaged and women-owned 
small business subcontracting for its commercial products, or, if there 
is no currently approved plan, assist the contracting officer in 
evaluating the plans for those products.
    (54) Assist the contracting officer, upon request, in evaluating an 
offeror's proposed small, small disadvantaged and women-owned small 
business subcontracting plans, including documentation of compliance 
with similar plans under prior contracts.
    (55) By periodic surveillance, ensure the contractor's compliance 
with small, small disadvantaged and women-owned small business 
subcontracting plans and any labor surplus area contractual 
requirements; maintain documentation of the contractor's performance 
under and compliance with these plans and requirements; and provide 
advice and assistance to the firms involved, as appropriate.
* * * * *


42.501  [Amended]

    55. Section 42.501 is amended in paragraph (b) by removing the word 
``and'' and inserting a comma in its place; and inserting after the 
word ``disadvantaged'' the phrase ``and women-owned small''.
    56. Section 42.502 is amended by revising paragraphs (i) and (j) to 
read as follows:


42.502  Selecting contracts for postaward orientation.

* * * * *
    (i) Contractor's status, if any, as a small business, small 
disadvantaged or women-owned small business concern;
    (j) Contractor's performance history with small, small 
disadvantaged and women-owned small business subcontracting programs;
* * * * *

PART 44--SUBCONTRACTING POLICIES AND PROCEDURES


44.202-2  [Amended]

    57. Section 44.202-2 is amended in paragraph (a)(4) by removing the 
phrase ``labor surplus area or''; removing the phrase ``business 
concerns and'' and inserting a comma in its place; and inserting after 
the word ``disadvantaged'' the phrase ``and women-owned small''.


44.303  [Amended]

    58. Section 44.303 is amended in paragraph (e) by removing the 
phrase ``labor surplus area concerns and''; and inserting after the 
word ``disadvantaged'' the phrase ``and women-owned small''.

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    59. Section 52.204-5 is added to read as follows:


52.204-5  Women-Owned Business.

    As prescribed in 4.603, insert the following provision:

Women-Owned Business (Oct 1995)

    (a) Representation. The offeror represents that it {time}  is, 
{time}  is not a women-owned business concern.
    (b) Definition. ``Women-owned business concern,'' as used in 
this provision, 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 the stock of which is owned by one or more 
women; and whose management and daily business operations are 
controlled by one or more women.

(End of provision)


52.216-21  [Amended]

    60. Section 52.216-21 is amended by revising the clause date to 
read (OCT 1995), in Alternates III and IV by revising the dates to read 
``(OCT 1995)'' and by removing the phrase ``or labor surplus area'' 
from the introductory texts.
    61. Section 52.219-1 is revised to read as follows:


52.219-1  Small Business Program Representations.

    As prescribed in 19.304(a), insert the following provision:

Small Business Program Representations (Oct 1995)

    (a)(1) The standard industrial classification (SIC) code for 
this acquisition is __________ (insert SIC 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.
    (b) Representations. (1) The offeror represents and certifies as 
part of its offer that it {time}  is, {time}  is not a small 
business concern.
    (2) (Complete only if offeror represented itself as a small 
business concern in block (b)(1) of this section.) The offeror 
represents as part of its offer that it {time}  is, {time}  is not a 
small disadvantaged business concern.
    (3) (Complete only if offeror represented itself as a small 
business concern in block (b)(1) of this section.) The offeror 
represents as part of its offer that it {time}  is, {time}  is not a 
women-owned small business concern.
    (c) Definitions. Small business concern, as used in this 
provision, 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.
    Small disadvantaged business concern, as used in this provision, 
means a small business concern that (1) is at least 51 percent 
unconditionally owned by one or more individuals who are both 
socially and economically disadvantaged, or a publicly owned 
business having at least 51 percent of its stock unconditionally 
owned by one or more socially and economically disadvantaged 
individuals, and (2) has its management and daily business 
controlled by one or more such individuals. This term also means a 
small business concern that is at least 51 percent unconditionally 
owned by an economically disadvantaged Indian tribe or Native 
Hawaiian Organization, or a publicly owned business having at least 
51 percent of its stock unconditionally owned by one or more of 
these entities, which has its management and daily business 
controlled by members of an economically disadvantaged Indian tribe 
or Native Hawaiian Organization, and which meets the requirements of 
13 CFR Part 124.
    Women-owned small business concern, as used in this provision, 
means a small business concern--
    (1) 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 
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 

[[Page 48265]]
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 or small disadvantaged business concern in 
order to obtain a contract to be awarded under the preference 
programs established pursuant to sections 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)


52.219-2  [Removed]


52.220-1  [Redesignated as 52.219]

    62. Section 52.219-2 is removed and 52.220-1 is redesignated in its 
place and is revised to read as follows:


52.219-2  Equal Low Bids.

    As prescribed in 19.304(b), 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)


52.219-3 and 52.219-5  [Removed and reserved]

    63. Sections 52.219-3 and 52.219-5 are removed and reserved.
    64. Section 52.219-6 is amended by revising Alternate I to read as 
follows:


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

* * * * *
    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).

    65. Section 52.219-7 is amended by revising the date of the clause; 
in paragraph (a) by removing the definitions Labor surplus area, Labor 
surplus area concern, and Perform substantially in labor surplus areas; 
and by revising paragraphs (b)(4) and (c) and Alternate I to read as 
follows:


52.219-7  Notice of Partial Small Business Set-Aside.

* * * * *

Notice of Partial Small Business Set-Aside (Oct 1995)

* * * * *
    (b) * * *
    (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 
manufacturer or regular dealer submitting an offer in its own name 
agrees to furnish, in performing the contract, only end items 
manufactured or produced by small business concerns inside the 
United States, its territories and possessions, the Commonwealth of 
Puerto Rico, the Trust Territory of the Pacific Islands, or the 
District of Columbia. However, this requirement does not apply in 
connection with 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).

    66. Section 52.219-8 is amended by revising the section heading; 
the clause heading and date; paragraph (a); redesignating paragraph (d) 
as (e) and revising it; and adding a new paragraph (d) to read as 
follows:


52.219-8  Utilization of Small, Small Disadvantaged and Women-Owned 
Small Business Concerns.

* * * * *

Utilization of Small, Small Disadvantaged and Women-Owned Small 
Business Concerns (Oct 1995)

    (a) It is the policy of the United States that small business 
concerns, small business concerns owned and controlled by socially 
and economically disadvantaged individuals and small business 
concerns owned and controlled by women 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, small business concerns owned and 
controlled by socially and economically disadvantaged individuals 
and small business concerns owned and controlled by women.
* * * * *
    (d) The term ``small business concern owned and controlled by 
women'' shall mean a small business concern (i) 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 the stock of which is owned 
by one or more women, and (ii) whose management and daily business 
operations are controlled by one or more women; and
    (e) Contractors acting in good faith may rely on written 
representations by their subcontractors regarding their status as a 
small business concern, a small business concern owned and 
controlled by socially and economically disadvantaged individuals or 
a small business concern owned and controlled by women.

(End of clause)

    67. Section 52.219-9 is amended by revising--
    a. The section heading;
    b. The clause heading and date;
    c. The first two sentences of paragraph (c);
    d. Paragraphs (d), (e), (i), and Alternate I to read as follows:


52.219-9   Small, Small Disadvantaged and Women-Owned Small Business 
Subcontracting Plan.

* * * * *

Small, Small Disadvantaged and Women-Owned Small Business 
Subcontracting Plan (Oct 1995)

* * * * *
    (c) The offeror, upon request by the Contracting Officer, shall 
submit and negotiate a subcontracting plan, where applicable, which 
separately addresses subcontracting with small business concerns, 
with small disadvantaged business concerns and with women-owned 
small business concerns. If the offeror is submitting an individual 
contract plan, the plan must separately address subcontracting with 
small business concerns, small disadvantaged business concerns, and 
women-owned small 

[[Page 48266]]
business concerns with a separate part for the basic contract and 
separate parts for each option (if any). * * *
    (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 concerns, 
small disadvantaged business concerns 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;
    (ii) Total dollars planned to be subcontracted to small business 
concerns;
    (iii) Total dollars planned to be subcontracted to small 
disadvantaged business concerns; and
    (iv) 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) 
small disadvantaged business concerns and (iii) 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 Automated Source System (PASS) of the Small 
Business Administration, 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, small disadvantaged and women-owned small 
business concerns trade associations). A firm may rely on the 
information contained in PASS as an accurate representation of a 
concern's size and ownership characteristics for purposes of 
maintaining a small business source list. A firm may rely on PASS as 
its small business source list. Use of the PASS as its source list 
does not relieve a firm of its responsibilities (e.g., outreach, 
assistance, counseling, publicizing subcontracting opportunities) in 
this clause.
    (6) A statement as to whether or not the offeror 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) small disadvantaged business concerns, and (iii) 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, small disadvantaged and women-owned small business 
concerns have an equitable opportunity to compete for subcontracts.
    (9) Assurances that the offeror will include the clause in this 
contract entitled ``Utilization of Small, Small Disadvantaged and 
Women-Owned Small Business Concerns'' in all subcontracts that offer 
further subcontracting opportunities, and that the offeror will 
require all subcontractors (except small business concerns) who 
receive subcontracts in excess of $500,000 ($1,000,000 for 
construction of any public facility) to adopt a plan similar to the 
plan agreed to by the offeror.
    (10) Assurances that the offeror will (i) cooperate in any 
studies or surveys as may be required, (ii) submit periodic reports 
in order to allow the Government to 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 the instructions on the forms, and (iv) ensure that its 
subcontractors agree to submit Standard Forms 294 and 295.
    (11) A recitation of the types of records the offeror will 
maintain to demonstrate procedures that have been adopted to comply 
with the requirements and goals in the plan, including establishing 
source lists; and a description of its efforts to locate small, 
small disadvantaged 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., PASS), guides, and other data that 
identify small, small disadvantaged and women-owned small business 
concerns.
    (ii) Organizations contacted in an attempt to locate sources 
that are small, small disadvantaged 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 small 
disadvantaged business concerns were solicited and if not, why not, 
(C) whether women-owned small business concerns were solicited and 
if not, why not, and (D) 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, and (C) 
conferences and trade fairs to locate small, small disadvantaged and 
women-owned small business sources.
    (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 
company or division-wide annual 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, small disadvantaged 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, small disadvantaged 
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, small disadvantaged and women-owned small 
business concerns in all ``make-or-buy'' decisions.
    (3) Counsel and discuss subcontracting opportunities with 
representatives of small, small disadvantaged and women-owned small 
business firms.
    (4) Provide notice to subcontractors concerning penalties and 
remedies for misrepresentations of business status as 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.
* * * * *
    (i) The failure of the Contractor or subcontractor to comply in 
good faith with (1) the clause of this contract entitled 
``Utilization Of Small, Small Disadvantaged and Women-Owned Small 
Business Concerns,'' or (2) an approved plan required by this 
clause, shall be a material breach of the contract.

(End of clause)

    Alternate I (OCT 1995). 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, which 
separately addresses subcontracting with small business concerns, 
with small disadvantaged business concerns and with women-owned 
small business concerns. If the bidder is submitting an individual 
contract plan, the plan must separately address subcontracting with 
small business concerns, small disadvantaged business concerns 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.


52.219-10   [Amended]

    68. Section 52.219-10 is amended in--
    (a) The section heading and clause heading by removing ``for Small 
and Small Disadvantaged Business Concerns'' and revising the clause 
date to read ``Oct. 1995''.
    (b) The introductory text by removing the text following 
``19.708(c)(1),'' and 

[[Page 48267]]
inserting in its place ``insert the following clause:''; and
    (c) Paragraph (a) of the clause by removing ``and'', inserting a 
comma, and removing the period at the end of the sentence and inserting 
``and a certain percentage to women-owned small business concerns.''


52.219-13   [Removed and reserved]

    69. Section 52.219-13 is removed and reserved.
    70. Section 52.219-16 is amended by revising the section heading, 
clause heading and date; paragraph (a); the first sentence of paragraph 
(b); and paragraphs (d) and (f) to read as follows:


52.219-16   Liquidated Damages--Subcontracting Plan.

* * * * *

Liquidated Damages--Subcontracting Plan (Oct 1995)

    (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, Small Disadvantaged and Women-Owned Small 
Business Subcontracting Plan,'' or willful or intentional action to 
frustrate the plan.
    (b) If, at contract completion, or in the case of a commercial 
product 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, Small Disadvantaged and Women-Owned Small Business 
Subcontracting Plan,'' the Contractor shall pay the Government 
liquidated damages in an amount stated. * * *
* * * * *
    (d) With respect to commercial product plans; i.e., company-wide 
or division-wide subcontracting plans approved under paragraph (g) 
of the clause in this contract entitled ``Small, Small Disadvantaged 
and Women-Owned Small Business Subcontracting Plan,'' the 
Contracting Officer of the agency that originally approved the plan 
will exercise the functions of the Contracting Officer under this 
clause on behalf of all agencies that awarded contracts covered by 
that commercial product plan.
* * * * *
    (f) Liquidated damages shall be in addition to any other 
remedies that the Government may have.

(End of clause)

    71. Section 52.219-18 is amended by revising Alternate III to read 
as follows:


52.219-18   Notification of Competition Limited to Eligible 8(a) 
Concerns.

* * * * *
    Alternate III (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 (d).
52.219-22   [Removed and reserved]

    72. Section 52.219-22 is removed and reserved.


52.220-2, 52.220-3, and 52.220-4   [Removed]

    73. Sections 52.220-2, 52.220-3, and 52.220-4 are removed.

PART 53--FORMS

    74. Section 53.219 is revised to read as follows:


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 OCT 1995), Subcontracting Report for Individual 
Contracts. (See 19.704(a)(5).)
    (b) SF 295 (REV OCT 1995), Summary Subcontract Report. (See 
19.704(a)(5).) 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.
    75. Sections 53.301-294 and 53.301-295 are revised to read as 
follows:

BILLING CODE 6820-EP-P

[[Page 48268]]



53.301-294   Subcontracting Report for Individual Contracts.
[GRAPHIC][TIFF OMITTED]TR18SE95.003


[[Page 48269]]
[GRAPHIC][TIFF OMITTED]TR18SE95.004



BILLING CODE 6820-EP-C

[[Page 48270]]



53.301-295   Summary Subcontract Report.
[GRAPHIC][TIFF OMITTED]TR18SE95.005


[[Page 48271]]
[GRAPHIC][TIFF OMITTED]TR18SE95.006




[[Page 48272]]

[FR Doc. 95-22780 Filed 9-15-95; 8:45 am]
BILLING CODE 6820-EP-C