[Federal Register Volume 71, Number 54 (Tuesday, March 21, 2006)]
[Proposed Rules]
[Pages 14149-14151]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-3992]


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

DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 232 and 252

RIN 0750-AF28


Defense Federal Acquisition Regulation Supplement; Electronic 
Submission and Processing of Payment Requests (DFARS Case 2005-D009)

AGENCY: Defense Acquisition Regulations System, Department of Defense 
(DoD).

ACTION: Proposed rule with request for comments.

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

SUMMARY: DoD is proposing to amend the Defense Federal Acquisition

[[Page 14150]]

Regulation Supplement (DFARS) to update policy regarding requirements 
for DoD contractors to submit payment requests in electronic form. The 
proposed rule clarifies the situations under which DoD will grant 
exceptions to requirements for electronic submission of payment 
requests.

DATES: Comments on the proposed rule should be submitted in writing to 
the address shown below on or before May 22, 2006 to be considered in 
the formation of the final rule.

ADDRESSES: You may submit comments, identified by DFARS Case 2005-D009, 
using any of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     E-mail: [email protected]. Include DFARS Case 2005-D009 in the 
subject line of the message.
     Fax: (703) 602-0350.
     Mail: Defense Acquisition Regulations System, Attn: Mr. 
Bill Sain, OUSD (AT&L) DPAP (DARS), IMD 3C132, 3062 Defense Pentagon, 
Washington, DC 20301-3062.
     Hand Delivery/Courier: Defense Acquisition Regulations 
System, Crystal Square 4, Suite 200A, 241 18th Street, Arlington, VA 
22202-3402.
    Comments received generally will be posted without change to http://www.regulations.gov, including any personal information provided.

FOR FURTHER INFORMATION CONTACT: Mr. Bill Sain, (703) 602-0293.

SUPPLEMENTARY INFORMATION:

A. Background

    DFARS subpart 232.70 and the corresponding contract clause at DFARS 
252.232-7003 contain requirements for electronic submission and 
processing of contract payment requests, in accordance with 10 U.S.C. 
2227. The DFARS provides for certain exceptions to these requirements, 
to include one that applies if a contractor is unable to submit, or DoD 
is unable to receive, a payment request in electronic form. When this 
exception applies, the contractor must submit the payment request using 
a method mutually agreed to by the contractor, the contracting officer, 
the contract administration office, and the payment office. This DFARS 
text has caused differing interpretations as to what constitutes a 
contractor's inability to submit an electronic payment request, and 
whether the contracting officer, the contract administration office, 
and the payment office all must agree that the contractor is unable to 
submit an electronic payment request or if this decision is the sole 
authority of the contracting officer. Furthermore, the DFARS presently 
does not contain a requirement for the contract to specify the 
alternative method to be used when non-electronic submission is 
authorized.
    To clarify requirements for submission of payment requests, DoD is 
proposing the following DFARS changes:
     Amendment of 232.7002(a) to replace the language that has 
caused confusion with an exception that applies when the administrative 
contracting officer determines, in writing, that electronic submission 
would be unduly burdensome to the contractor. The proposed language is 
consistent with the provisions of 10 U.S.C. 2227.
     Addition of a new paragraph at 232.7002(c) to require the 
contracting officer to specify, in Section G of the contract, the 
payment request method to be used when electronic submission is not 
required.
     Amendment of the clause at 252.232-7003 for consistency 
with the changes to 232.7002, and to add a reference to a DoD website 
that will contain a listing of the DoD activities and payment systems 
that are unable to receive payment requests in electronic form.
    This rule was not subject to Office of Management and Budget review 
under Executive Order 12866, dated September 30, 1993.

B. Regulatory Flexibility Act

    DoD does not expect this rule 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 rule is 
designed to avoid any such impact by permitting alternative means of 
requesting payment when submission of electronic payment requests would 
be unduly burdensome to a contractor. Therefore, DoD has not performed 
an initial regulatory flexibility analysis. DoD invites comments from 
small businesses and other interested parties. DoD also will consider 
comments from small entities concerning the affected DFARS subparts in 
accordance with 5 U.S.C. 610. Such comments should be submitted 
separately and should cite DFARS Case 2005-D009.

C. Paperwork Reduction Act

    The proposed rule does not impose any information collection 
requirements that require the approval of the Office of Management and 
Budget under 44 U.S.C. 3501, et seq.

List of Subjects in 48 CFR Parts 232 and 252

    Government procurement.

Michele P. Peterson
Editor, Defense Acquisition Regulations System.

    Therefore, DoD proposes to amend 48 CFR parts 232 and 252 as 
follows:
    1. The authority citation for 48 CFR parts 232 and 252 continues to 
read as follows:

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

PART 232--CONTRACT FINANCING

    2. Section 232.7002 is revised to read as follows:


232.7002  Policy.

    (a) Contractors shall submit payment requests in electronic form, 
except for--
    (1) Purchases paid for with a Governmentwide commercial purchase 
card;
    (2) Awards made to foreign vendors for work performed outside the 
United States;
    (3) Classified contracts or purchases when electronic submission 
and processing of payment requests could compromise the safeguarding of 
classified information or national security;
    (4) Contracts awarded by deployed contracting officers in the 
course of military operations, including, but not limited to, 
contingency operations as defined in 10 U.S.C. 101(a)(13) or 
humanitarian or peacekeeping operations as defined in 10 U.S.C. 2302(8) 
or contracts awarded by contracting officers in the conduct of 
emergency operations, such as responses to natural disasters or 
national or civil emergencies;
    (5) Purchases to support unusual or compelling needs of the type 
described in FAR 6.302-2;
    (6) Cases in which DoD is unable to receive payment requests in 
electronic form; or
    (7) Cases in which the administrative contracting officer has 
determined, in writing, that electronic submission would be unduly 
burdensome to the contractor.
    (b) DoD officials receiving payment requests in electronic form 
shall process the payment requests in electronic form. Any supporting 
documentation necessary for payment, such as receiving reports, 
contracts, contract modifications, and required certifications, also 
shall be processed in electronic form. Scanned documents are acceptable 
forms for processing supporting documentation.

[[Page 14151]]

    (c) When payment requests will not be submitted in electronic form, 
Section G of the contract shall specify the alternative payment request 
method or methods to be used (e.g., facsimile, conventional mail).
    3. Section 232.7004 is revised to read as follows:


Sec.  232.7004  Contract clause.

    Except as provided in 232.7002(a)(1) through (6), use the clause at 
252.232-7003, Electronic Submission of Payment Requests, in 
solicitations and contracts.

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    4. Section 252.232-7003 is amended as follows:
    a. By revising the clause date and paragraph (c);
    b. By redesignating paragraph (d) as paragraph (e); and
    c. By adding a new paragraph (d) to read as follows:


252.232-7003  Electronic Submission of Payment Requests.

* * * * *
Electronic Submission of Payment Requests (XXX 2006)
* * * * *
    (c) The Contractor may submit a payment request in non-electronic 
form only when--
    (1) The Administrative Contracting Officer has determined, in 
writing, that electronic submission would be unduly burdensome to the 
Contractor. In such cases, the Contractor shall include a copy of the 
Administrative Contracting Officer's determination with each request 
for payment; or
    (2) DoD is unable to receive a payment request in electronic form. 
A listing of the DoD activities and payment systems that are unable to 
receive payment requests in electronic form is available at http://www.dod.mil/dfas/ecedi/.
    (d) The Contractor shall submit any non-electronic payment requests 
using the method or methods specified in Section G of the contract.
* * * * *
[FR Doc. E6-3992 Filed 3-20-06; 8:45 am]
BILLING CODE 5001-01-P