[Federal Register Volume 61, Number 141 (Monday, July 22, 1996)]
[Rules and Regulations]
[Pages 37841-37842]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-18431]


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

DEPARTMENT OF DEFENSE

48 CFR Parts 225 and 252

[DFARS Case 96-D312]


Defense Federal Acquisition Regulation Supplement; Petroleum 
Products From Caribbean Basin Countries

AGENCY: Department of Defense (DoD).

ACTION: Interim rule with request for comment.

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

SUMMARY: The Director of Defense Procurement has issued an interim rule 
amending the Defense Federal Acquisition Regulation Supplement (DFARS) 
to fully implement Section 8094 of the Fiscal Year 1994 Defense 
Appropriations Act (Public Law 103-139). Section 8094 requires that the 
Department of Defense consider all qualified bids from any eligible 
country under the Caribbean Basin Economic Recovery Act as if they were 
offers from designated countries under the Trade Agreements Act.

DATES: Effective date: July 22, 1996.
    Comment date: Comments on the interim rule should be submitted in 
writing to the address shown below on or before September 20, 1996, to 
be considered in the formulation of the final rule.

ADDRESSES: Interested parties should submit written comments to: 
Defense Acquisition Regulations Council, Attn: Ms. Amy Williams, PDUSD 
(A&T) DP (DAR), IMD 3D139, 3062 Defense Pentagon, Washington, DC 20301-
3062. Telefax number (703) 602-0350. Please cite DFARS Case 96-D312 in 
all correspondence related to this issue.

FOR FURTHER INFORMATION CONTACT: Ms. Amy Williams, (703) 602-0131.

SUPPLEMENTARY INFORMATION:

A. Background

    This interim rule implements Section 8094 of the Fiscal Year 1994 
Defense Appropriations Act (Pub. L. 103-139). This requirement was 
originally implemented at DFARS 225.401, 225.403(m)(4), and 225.403-70 
under DFARS Case 93-D312. The final rule was published in the Federal 
Register on May 5, 1994 (59 FR 23169). The implementation at DFARS 
225.403(m)(4) was limited to contracts awarded during fiscal year 1994. 
Because Section 8094 of Pub. L. 103-139 does not contain time limits, 
this rule removes the time limit at 225.403(m)(4). In addition, this 
rule amends DFARS 225.403-70 and 252.225-7007 to clarify that the 
definition of Caribbean Basin country end products includes petroleum 
and any end product derived from petroleum.

B. Regulatory Flexibility Act

    This interim 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 
petroleum and products derived from petroleum are already subject to 
the Trade Agreements Act. The consideration of Caribbean Basin country 
offers of petroleum and products derived from petroleum is not expected 
to significantly affect the petroleum market in this country. 
Furthermore, the Trade Agreements Act and the Caribbean Basin Economic 
Recovery Act apply only to acquisitions exceeding $190,000 in value. 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 DFARS subparts will be considered in accordance with Section 
610 of the Act. Such comments must be submitted separately and cite 
DFARS Case 96-D312 in correspondence.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply. This interim rule does 
not impose any new information collection requirements which require 
the approval of the Office of Management and Budget under 44 U.S.C. 
3501, et seq.

D. Determination to Issue an Interim Rule

    A determination has been made under the authority of the Secretary 
of Defense that compelling reasons exist to promulgate this interim 
rule prior to affording the public an opportunity to comment. This 
action is necessary to fully implement Section 8094 of the Fiscal Year 
1994 Defense Appropriations Act (Pub. L. 103-139). Comments received in 
response to the publication of this interim rule will be considered in 
formulating the final rule.

List of Subjects in 48 CFR Parts 225 and 252

    Government procurement.
Michele P. Peterson,
Executive Editor, Defense Acquisition Regulations Council.

    Therefore, 48 CFR Parts 225 and 252 are amended as follows:

    1. The authority citation for 48 CFR Parts 225 and 252 continues to 
read as follows:

    Authority: 41 U.S.C. 421 and 48 CFR Chapter 1.

PART 225--FOREIGN ACQUISITION

    2. Section 225.403 is amended by removing paragraph (m)(4) and by 
adding in its place paragraph (g)(4) to read as follows:


225.403  Exceptions.

* * * * *
    (g) (4) In accordance with Section 8094 of the Fiscal Year 1994 
Defense Appropriations Act (Public Law 103-139), the exception for 
petroleum and any product derived from petroleum does not apply.
    3. Section 225.403-70 is amended by revising the introductory text 
to read as follows:


225.403-70  Products subject to trade agreement acts.

    Foreign end products subject to the Trade Agreements Act and NAFTA 
are those in the following Federal supply groups (FSG). If a product is 
not in one of the listed groups, the Trade Agreements Act and NAFTA do 
not apply. The definition of Caribbean Basin country end products in 
FAR 25.401 excludes those end products which are not eligible for duty-
free treatment

[[Page 37842]]

under 19 U.S.C. 2703(b). However, 225.401 expands the definition of 
Caribbean Basin country end products to include petroleum and any 
product derived from petroleum. The list of products has been annotated 
to indicate those products which are eligible for designated and NAFTA 
countries, but are not presently eligible for Caribbean Basin 
countries.
* * * * *

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    4. Section 252.225-7007 is amended by revising the clause date to 
read ``(JUL 1996)''; by revising the introductory text of paragraph 
(a)(1)(ii); by adding the word ``and'' at the end of paragraph 
(a)(1)(ii)(C); by revising paragraph (a)(1)(ii)(D); and by removing 
paragraph (a)(1)(ii)(E). The revised text reads as follows:


252.225-7007  Trade Agreements.

* * * * *
    (a)* * *
    (1)* * *
    (ii) Excludes products, other than petroleum and any product 
derived from petroleum, that are not granted duty-free treatment under 
the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(b)). These 
exclusions presently consist of--
* * * * *
    (D) 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 which is the product of any country to which 
Harmonized Tariff Schedule column 2 rates of duty apply.
* * * * *
[FR Doc. 96-18431 Filed 7-19-96; 8:45 am]
BILLING CODE 5000-04-M