[Federal Register Volume 60, Number 207 (Thursday, October 26, 1995)]
[Proposed Rules]
[Page 54918]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-26487]



      

[[Page 54917]]

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Part II

Department of Defense

General Services Administration

National Aeronautics and Space Administration
_______________________________________________________________________



48 CFR Part 31



Federal Acquisition Regulation, Legal Proceedings Costs; Proposed Rule

  Federal Register / Vol. 60, No. 207 / Thursday, October 26, 1995 / 
Proposed Rules  

[[Page 54918]]


DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Part 31

[FAR Case 93-10]
RIN 9000-AG65


Federal Acquisition Regulation; Legal Proceedings Costs

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

ACTION: Proposed rule.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council are proposing changes to amend the 
Federal Acquisition Regulation (FAR) concerning costs related to legal 
and other proceedings to make the costs of pre- or post-award protests 
(except for costs incurred by an intervenor on the side of the 
Government) an unallowable cost. This regulatory action was not subject 
to Office of Management and Budget review under Executive Order 12866, 
dated September 30, 1993.

DATES: Comments should be submitted on or before December 26, 1995 to 
be considered in the formulation of a final rule.

ADDRESSES: Interested parties should submit written comments to: 
General Services Administration, FAR Secretariat (VRS), 18th and F 
Streets, NW, Room 4037, Washington, DC 20405.
    Please cite FAR case 93-10 in all correspondence related to this 
case.

FOR FURTHER INFORMATION CONTACT: Mr. Jeremy Olson at (202) 501-3221 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 FAR case 93-10.

SUPPLEMENTARY INFORMATION:

A. Background

    This proposed rule would add another category of unallowable costs 
to the list at 31.205-47(f) (except for costs incurred by an intervenor 
on the side of the Government) which should disallow most cost of pre- 
or post-award protests. This change is being proposed after the Defense 
Contract Audit Agency raised a concern that rulings by the Armed 
Services Board of Contract Appeals (ASBCA) would encourage contractors 
to protest Government awards (the appeal of Bos'n Towing and Salvage 
Company (ASBCA 1992) No. 41357, 92-2 BCA Paragraph 24,864 and the 
appeal of J.W. Cook & Sons, Inc., (ASBCA 1992) No. 39691, 92-3 BCA 
Paragraph 25,053). The ASBCA had ruled that FAR 31.205-47(f)(1) only 
applied to claims under the Contract Disputes Act and not to protests 
under the Competition in Contracting Act and that, therefore, protest 
costs were allowable as either a direct or indirect cost on Government 
contracts.

B. Regulatory Flexibility Act

    This 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 most 
contracts awarded to small entities are awarded on a competitive, 
fixed-price basis and the cost principles do not apply. The cost 
principles apply only to contracts for which cost or pricing data has 
been submitted. An Initial Regulatory Flexibility Analysis has, 
therefore, not been performed. Comments from small entities concerning 
the affected FAR subpart will be considered in accordance with 5 U.S.C. 
610 of the Act. Such comments must be submitted separately and should 
cite 5 U.S.C. 601 et seq. (FAR case 93-10), in correspondence.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the proposed 
changes to the FAR do not impose recordkeeping or information 
collection requirements, or collections of information from offerors, 
contractors, or members of the public which require the approval of the 
Office of Management and Budget under 44 U.S.C. 3501 et seq.

List of Subjects in 48 CFR Part 31

    Government procurement.

    Dated: October 18, 1995.
Edward C. Loeb,
Acting Director, Officer of Federal Acquisition Policy.

    Therefore, it is proposed that 48 CFR Part 31 be amended as set 
forth below:

PART 31--CONTRACT COST PRINCIPLES AND PROCEDURES

    1. The authority citation for 48 CFR Part 31 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).
    2. Section 31.205-47 is amended by adding paragraph (f)(8) to read 
as follows:


31.205-47  Costs related to legal and other proceedings.

* * * * *
    (f) * * *
    (8) Protests of Federal Government solicitations or contract 
awards, unless the costs are incurred by interested parties to defend 
against such protests.
* * * * *
[FR Doc. 95-26487 Filed 10-25-95; 8:45 am]
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