[Federal Register Volume 71, Number 55 (Wednesday, March 22, 2006)]
[Proposed Rules]
[Page 14445]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-2756]

[[Page 14445]]





48 CFR Part 13

[FAR Case 2005-029; Docket 2006-0020]
RIN 9000-AK46

Federal Acquisition Regulation; FAR Case 2005-029, Termination or 
Cancellation of Purchase Orders

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

ACTION: Proposed rule.


SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council (Councils) are proposing to amend the 
Federal Acquisition Regulation (FAR) to correct the inadvertent 
omission of appropriate references in the FAR pertaining to termination 
for cause of those purchase orders that have been accepted in writing. 
The Government is soliciting comments from interested parties to ensure 
the language in this proposed rule is clear in stating the appropriate 
termination coverage for commercial purchase orders that have been 
accepted in writing by the contractor.

DATES: Interested parties should submit written comments to the FAR 
Secretariat on or before May 22, 2006 to be considered in the 
formulation of a final rule.

ADDRESSES: Submit comments identified by FAR case 2005-029 by any of 
the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Agency Web Site: http://www.acqnet.gov/far/ProposedRules/proposed.htm. Click on the FAR case number to submit comments.
     E-mail: [email protected]. Include FAR case 2005-
029 in the subject line of the message.
     Fax: 202-501-4067.
     Mail: General Services Administration, Regulatory 
Secretariat (VIR), 1800 F Street, NW, Room 4035, ATTN: Laurieann 
Duarte, Washington, DC 20405.
    Instructions: Please submit comments only and cite FAR case 2005-
029 in all correspondence related to this case. All comments received 
will be posted without change to http://www.acqnet.gov/far/ProposedRules/proposed.htm, including any personal and/or business 
confidential information provided.

FOR FURTHER INFORMATION CONTACT: For clarification of content, contact 
Mr. Michael O. Jackson, Procurement Analyst, at (202) 208-4949. Please 
cite FAR case 2005-029 for information pertaining to status or 
publication schedules, contact the FAR Secretariat at (202) 501-4755.


A. Background

    This rule proposes to amend FAR 13.302-4 by reinstating the 
appropriate coverage for termination for cause of commercial purchase 
    For commercial purchase orders that have been accepted in writing 
by the contractor, current references to FAR 12.403(d) and FAR 52.212-
4(l) as stated in 13.302-4(a) address termination for convenience. The 
current FAR language at 13.302-4(a) was established in February 1998 
under Federal Acquisition Circular 97-3. This change constituted a 
complete rewrite/reorganization of FAR Part 13. Previously, FAR Part 13 
identified both termination for cause as well as for convenience as the 
termination methods available to contracting officers. Furthermore, FAR 
12.403 permits the Government to terminate a contract for commercial 
items either for the convenience of the Government or for cause, and 
makes no distinction based on the dollar value of the commercial item 
contract, nor the contractual method utilized to procure the commercial 
item. Therefore, the proposed changes at FAR 13.302-4(a) reinstitute 
references to procedures for termination for cause as well as 
termination for convenience.
    This is not a significant regulatory action and, therefore, was not 
subject to review under Section 6(b) of Executive Order 12866, 
Regulatory Planning and Review, dated September 30, 1993. This rule is 
not a major rule under 5 U.S.C. 804.

B. Regulatory Flexibility Act

    The Councils do not expect this proposed 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 does not change the Government's existing termination 
rights but merely clarifies those rights by correcting an inadvertent 
error in the FAR. An Initial Regulatory Flexibility Analysis has, 
therefore, not been performed. We invite comments from small businesses 
and other interested parties. The Councils will consider comments from 
small entities concerning the affected FAR Part 13 in accordance with 5 
U.S.C. 610. Interested parties must submit such comments separately and 
should cite 5 U.S.C. 601, et seq. (FAR case 2005-029), in 

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the proposed 
changes to the FAR do not impose 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 Part 13

    Government procurement.

    Dated: March 15, 2006.
Gerald Zaffos,
Director, Contract Policy Division.
    Therefore, DoD, GSA, and NASA propose amending 48 CFR part 13 as 
set forth below:


    1. The authority citation for 48 CFR part 13 continues to read as 

    Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42 
U.S.C. 2473(c).
    2. Amend section 13.302-4 by:
    a. Revising paragraph (a)(1); and
    b. Revising paragraph (b)(2) to read as follows:

13.302-4  Termination or cancellation of purchase orders.

    (a) * * *
    (1) 12.403 and 52.212-4(l) or (m) for commercial items; or
* * * * *
    (b) * * *
    (2) If the contractor does not accept the cancellation or claims 
that costs were incurred as a result of beginning performance under the 
purchase order, the contracting officer shall process the action as a 
termination prescribed in paragraph (a) of this subsection.

[FR Doc. 06-2756 Filed 3-21-06; 8:45 am]