[Federal Register Volume 61, Number 121 (Friday, June 21, 1996)]
[Proposed Rules]
[Page 32312]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14813]




[[Page 32311]]


_______________________________________________________________________

Part X

Department of Defense

General Services Administration

National Aeronautics and Space Administration
_______________________________________________________________________



48 CFR Part 12



Inapplicability of Cost Accounting Standards to Contracts and 
Subcontracts for Commercial Items; Proposed Rule

  Federal Register / Vol. 61, No. 121 / Friday, June 21, 1996 / 
Proposed Rules  

[[Page 32312]]



DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Part 12

[FAR Case 96-310]
RIN 9000-AH01


Federal Acquisition Regulation; Inapplicability of Cost 
Accounting Standards to Contracts and Subcontracts for Commercial Items

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 to amend the Federal 
Acquisition Regulation (FAR) Part 12 to implement Section 4205 of the 
fiscal year (FY) 96 National Defense Authorization Act. Section 4205 
amends Section 26(f) of the Office of Federal Procurement Policy (OFPP) 
Act (41 U.S.C. 422(f)) by exempting contracts and subcontracts for 
commercial items from the application of Cost Accounting Standards 
(CAS) promulgated under 41 U.S.C. 422. This regulatory action was not 
subject to Office of Management and Budget review under Executive Order 
12866, dated September 30, 1993. This is not a major rule under 5 
U.S.C. 804.

DATES: Comments should be submitted on or before August 20, 1996 to be 
considered in the formulation of a final rule.

ADDRESSES: Interested parties should submit written comments to: 
General Services Administration, FAR Secretariat (MVRS), 18th & F 
Streets, NW, Room 4037, Washington, DC 20405.
    Please cite FAR case 96-310 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 96-
310.

SUPPLEMENTARY INFORMATION: 

A. Background

    This proposed rule amends FAR part 12 to implement Section 4205 of 
the FY96 National Defense Authorization Act (Pub. L. 104-106). Section 
4205 amends Section 26(f) of the OFPP Act (41 U.S.C. 422(f)), making 
the application of CAS to commercial items ``nonmandatory.'' CAS 
requirements can still be invoked as a matter of policy by the CAS 
Board, pursuant to the authority provided in 41 U.S.C. 422. Any such 
guidance would be placed in 48 CFR Chapter 99. Therefore, the new 
coverage at FAR 12.214 indicates that CAS generally will not apply to 
commercial items unless so indicated at 48 CFR 9903.201. A cross-
reference to FAR 12.214 is added at 12.503(c) and 12.504(c), to further 
clarify the effect of Section 4205.

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 
contracts and subcontracts with small businesses are exempt from CAS. 
An initial regulatory flexibility analysis has therefore not been 
performed. Comments are invited from small businesses and other 
interested parties. Comments from small entities concerning the 
affected FAR subparts will be considered in accordance with Section 610 
of the Act. Such comments must be submitted separately and should cite 
5 U.S.C. 601, et seq. (FAR case 96-310), 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 12

    Government procurement.

    Dated: June 6, 1996.
Edward C. Loeb,
Director, Federal Acquisition Policy Division.

    Therefore, it is proposed that 48 CFR Part 12 be amended as set 
forth below:

PART 12--ACQUISITION OF COMMERCIAL ITEMS

    1. The authority citation for 48 CFR Part 12 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 12.214 is added to read as follows:


12.214  Cost Accounting Standards (CAS).

    CAS generally will not apply to commercial items. If CAS does apply 
pursuant to 48 CFR 9903.201 (appendix B, FAR loose-leaf edition), the 
contracting officer shall insert the appropriate provisions and clauses 
as prescribed in that section.
    3. Section 12.503(c)(3) is revised to read as follows:


12.503  Applicability of certain laws to Executive agency contracts for 
the acquisition of commercial items.

* * * * *
    (c) * * *
    (3) 41 U.S.C. 422, Cost Accounting Standards (48 CFR chapter 99) 
(see 12.214).
* * * * *
    4. Section 12.504(c)(3) is revised to read as follows:


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

* * * * *
    (c) * * *
    (3) 41 U.S.C. 422, Cost Accounting Standards (48 CFR chapter 99) 
(see 12.214).

[FR Doc. 96-14813 Filed 6-20-96; 8:45 am]
BILLING CODE 6820-EP-M