[Federal Register Volume 71, Number 124 (Wednesday, June 28, 2006)]
[Rules and Regulations]
[Pages 36923-36925]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-5711]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 2, 4, and 52

[FAC 2005-10; FAR Case 2005-007; Item I; Docket 2006-0020, Sequence 9]
RIN 9000-AK33


Federal Acquisition Regulation; FAR Case 2005-007, Central 
Contractor Registration--Taxpayer Identification Number (TIN) 
Validation

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

ACTION: Final rule.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council (Councils) have agreed on a final rule 
amending the Federal Acquisition Regulation (FAR) to include the 
process of validating a Central Contractor Registration (CCR) 
registrant's taxpayer identification number (TIN) with the Internal 
Revenue Service (IRS) to improve the quality of data in the Federal 
procurement system. Additionally, the amendment removes outdated 
language requiring modifications of contracts prior to December 31, 
2003, regarding CCR.

DATES: Effective Date: July 28, 2006.

FOR FURTHER INFORMATION CONTACT: For clarification of content, contact 
Mr. Michael O. Jackson, Procurement Analyst, at (202) 208-4949. Please 
cite FAC 2005-10, FAR case 2005-007. For information pertaining to 
status or publication schedules, contact the FAR Secretariat at (202) 
501-4755.

SUPPLEMENTARY INFORMATION:

A. Background

    Vendor registration in the CCR as a pre-requisite for receiving a 
contract has been required in the Department of Defense since 1998, and 
in civilian agencies since 2003. Since CCR's inception, validation of a 
registrant's TIN with the IRS has been contemplated in order to improve 
the quality of data throughout the Federal procurement system. This 
capability, although actively pursued, was never implemented as the 
Internal Revenue Code (I.R.C.) restricted disclosure of TINs without 
the taxpayer's consent, which due to technology at the time, would have 
been costly and inefficient to pursue. However, in its Fall 2004 
``Report to Senate Committee on Governmental Affairs Permanent 
Subcommittee on Investigations,'' the Federal Contractor Tax Compliance 
Task Force (which included the Office of Management and Budget, the 
Department of Treasury, the Department of Defense, the General Services 
Administration, the Department of Justice, and the IRS) recommended 
that ``... a consent-based TIN validation under I.R.C. Sec.  6103 
should be instituted.'' The capability for an event driven, near real-
time, or real-time, web-based solution integrating the CCR with an IRS 
validation is now possible due to advances in technology. The Task 
Force recommended updating the FAR to specifically identify the 
validation of the TIN as a part of CCR registration. In August 2005, a 
computer matching agreement was established between the IRS, as manager 
of the TIN database; GSA, as manager of the Integrated Acquisition 
Environment (IAE) Federal eGov initiative; and DOD, as executive agent 
for CCR.
    Additionally, FAR Subpart 4.11, Central Contractor Registration, 
contains language that was included when this subpart was implemented 
in the FAR in

[[Page 36924]]

2003. This outdated language required modifications of contracts by 
December 31, 2003, to include CCR registration requirements. As this 
date is past, the case removes the associated language.
    This final rule amends the Federal Acquisition Regulation by--
    1. Modifying Subpart 2.101 to indicate that the validation 
requirement for ``registered in CCR'' includes TIN matching.
    2. Removing FAR section 4.1103(a)(3), (a)(3)(i)-(ii) and a part of 
4.1104 to remove the language requiring action by December 31, 2003.
    3. Adding detail to FAR 52.204-7, Central Contractor Registration, 
to specifically identify validation of the TIN as a part of the 
definition ``Registered in the CCR Database,'' and to indicate that 
consent is part of that process.
    4. Removing Alternate I to FAR 52.204-7, Central Contractor 
Registration.
    DoD, GSA, and NASA published a proposed rule in the Federal 
Register at 70 FR 60782, October 19, 2005. The Councils received two 
public comments in response to the proposed rule.
    1. Comment: One commenter indicated that the language in the 
preamble under the Summary paragraph should read: ``... CCR) 
registrant's taxpayer identification number with the Internal Revenue 
Service to improve the quality of data in both the CCR and the Federal 
Procurement Data System--Next Generation (FPDS-NG'')
    Vice the original language:
    ``... CCR) registrant's taxpayer identification number with the 
Internal Revenue Service to improve data accuracy in the Federal 
procurement system.''
    Disposition: The Councils agree that the rule improves the quality 
of data. For clarification, FPDS-NG does not retain the Taxpayer 
Identification Number (TIN), and the validation process does not 
involve the FPDS-NG system.
    2. Comment: One commenter suggested that the General Services 
Administration include a mechanism to be used in the event that an 
employer is unable to receive validation for its taxpayer 
identification number (TIN) during the Central Contractor Registration 
(CCR) process. He stated a conditional registration may be in order 
until the contractor in concert with the GSA and IRS can determine the 
error. If a contractor is unable to obtain the TIN validation, a 
process for resolving the matter should be laid out for them online. A 
conditional registration should be allowed for participation in a bid 
so long as the contractor can show the TIN was valid at the time it 
applied for registration. Due to potential delays involving the 
interaction of two major agency computer systems, it seems reasonable 
that some safeguard should be in place for contractors, especially 
first time registrants that are likely to be smaller firms. The 
commenter asked that this issue be addressed by the Councils in its 
final rulemaking.
    Disposition: The intent of the rule is to make sure that the TIN an 
entity places in CCR is the same one that is designated by the IRS. A 
new CCR registration takes approximately 48 hours to process. Vendors 
with questions or comments relating to TIN matching or the registration 
process may contact the CCR Assistance Center at http://www.ccr.gov/help.asp or 888-227-2423. Vendors with general questions relating to 
TINs, or questions relating to a specific TIN, should contact the IRS. 
The Council will suggest the resolution of registration delays due to 
TIN matching to be addressed online in the CCR FAQs. While contractors 
may not receive an award without a valid CCR registration (see FAR 
4.1102(a)), they may participate in the bid process, which the Councils 
deem to be an adequate mechanism.
    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 Department of Defense, the General Services Administration, and 
the National Aeronautics and Space Administration certify 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., as no new requirements are 
being placed on the vendor community. No comments on this issue were 
received from small business concerns or other interested parties.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the 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 Parts 2, 4, and 52

    Government procurement.

    Dated: June 20, 2006.
Ralph De Stefano,
Director, Contract Policy Division.

0
Therefore, DoD, GSA, and NASA amend 48 CFR parts 2, 4, and 52 as set 
forth below:
0
1. The authority citation for 48 CFR parts 2, 4, and 52 continues to 
read as follows:

    Authority:  40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42 
U.S.C. 2473(c).

PART 2--DEFINITIONS OF WORDS AND TERMS

0
2. Amend section 2.101 in paragraph (b)(2) by revising paragraph (2) of 
the definition ``Registered in the CCR database'' to read as follows:


2.101  Definitions.

* * * * *
    (b) * * *
    (2) * * *
    Registered in the CCR database means that--
    (1) * * *
    (2) The Government has validated all mandatory data fields, to 
include validation of the Taxpayer Identification Number (TIN) with the 
Internal Revenue Service (IRS), and has marked the record ``Active''. 
The contractor will be required to provide consent for TIN validation 
to the Government as a part of the CCR registration process.
* * * * *

PART 4--ADMINISTRATIVE MATTERS

0
3. Amend section 4.1103 by--
0
a. Revising paragraph (a)(1);
0
b. Removing paragraph (a)(3);
0
c. Redesignating paragraph (b) as paragraph (a)(3); and
0
d. Redesignating paragraphs (c), (d), and (e) as paragraphs (b), (c), 
and (d), respectively.
0
The revised text reads as follows:


4.1103  Procedures.

    (a) * * *
    (1) Shall verify that the prospective contractor is registered in 
the CCR database (see paragraph (b) of this section) before awarding a 
contract or agreement. Contracting officers are encouraged to check the 
CCR early in the acquisition process, after the competitive range has 
been established, and then communicate to the unregistered offerors 
that they must register;
* * * * *


4.1104  [Amended]

0
4. Amend section 4.1104 by removing the last sentence.

[[Page 36925]]

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
5. Amend section 52.204-7 by--
0
a. Revising the date of the clause;
0
b. Revising paragraph (a)(2) of the definition ``Registered in the CCR 
database``; and
0
c. Removing Alternate I.
0
The revised and added text reads as follows:


52.204-7  Central Contractor Registration.

* * * * *

CENTRAL CONTRACTOR REGISTRATION (JUL 2006)

    (a) * * *
    Registered in the CCR database means that--
    (1) * * *
    (2) The Government has validated all mandatory data fields, to 
include validation of the Taxpayer Identification Number (TIN) with the 
Internal Revenue Service (IRS), and has marked the record ``Active''. 
The Contractor will be required to provide consent for TIN validation 
to the Government as a part of the CCR registration process.
* * * * *
[FR Doc. 06-5711 Filed 6-27-06; 8:45 am]
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