[Federal Register Volume 71, Number 70 (Wednesday, April 12, 2006)]
[Rules and Regulations]
[Page 18671]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-3453]


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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 225, 229, and 252

[DFARS Case 2004-D012]


Defense Federal Acquisition Regulation Supplement; Prohibition of 
Foreign Taxation on U.S. Assistance Programs

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

ACTION: Final rule.

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SUMMARY: DoD has adopted as final, without change, an interim rule 
amending the Defense Federal Acquisition Regulation Supplement (DFARS) 
to implement a statutory prohibition on foreign taxation under 
contracts funded by U.S. assistance programs. The rule addresses the 
responsibilities of the contractor and the contracting officer 
regarding the prohibition.

DATES: Effective Date: April 12, 2006.

FOR FURTHER INFORMATION CONTACT: Ms. Debra Overstreet, Defense 
Acquisition Regulations System, OUSD (AT&L) DPAP (DARS), IMD 3C132, 
3062 Defense Pentagon, Washington, DC 20301-3062. Telephone (703) 602-
0310; facsimile (703) 602-0350. Please cite DFARS Case 2004-D012.

SUPPLEMENTARY INFORMATION:

A. Background

    DoD published an interim rule at 70 FR 57191 on September 30, 2005, 
to implement Section 579 of Division E of the Consolidated 
Appropriations Act, 2003 (Pub. L. 108-7); Section 506 of Division D of 
the Consolidated Appropriations Act, 2004 (Pub. L. 108-199); and 
Section 506 of Division D of the Consolidated Appropriations Act, 2005 
(Pub. L. 108-447). These statutes require that a bilateral agreement 
providing for U.S. assistance to a foreign country must specify that 
the U.S. assistance shall be exempt from taxation by the foreign 
government. Therefore, the foreign government is prohibited from 
imposing taxes on commodities acquired under contracts funded by such 
U.S. assistance. This DFARS rule addresses the responsibilities of the 
contractor and the contracting officer regarding the prohibition.
    DoD received no comments on the interim rule. Therefore, DoD has 
adopted the interim rule as a final rule without change.
    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 certifies that this final rule will not 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 administrative notification requirements of the rule are 
expected to affect less than 10 contracts per year.

C. Paperwork Reduction Act

    The information collection requirements of the rule do not reach 
the threshold for requiring Office of Management and Budget approval 
under 44 U.S.C. 3501, et seq.

List of Subjects in 48 CFR Parts 225, 229, and 252

    Government procurement.

Michele P. Peterson,
Editor, Defense Acquisition Regulations System.

Interim Rule Adopted as Final Without Change

0
Accordingly, the interim rule amending 48 CFR parts 225, 229, and 252, 
which was published at 70 FR 57191 on September 30, 2005, is adopted as 
a final rule without change.

[FR Doc. 06-3453 Filed 4-11-06; 8:45 am]
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