[Federal Register Volume 71, Number 188 (Thursday, September 28, 2006)]
[Rules and Regulations]
[Pages 57355-57357]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-8199]

[[Page 57355]]


Part IV

Department of Defense

General Services Administration

National Aeronautics and Space Administration

48 CFR Parts 1, 2, 3, et. al.

Federal Acquisition Regulations; Final Rules

Federal Register / Vol. 71, No. 188 / Thursday, September 28, 2006 / 
Rules and Regulations

[[Page 57356]]





48 CFR Chapter 1

[Docket FAR-2006-0023, Sequence 5]

Federal Acquisition Regulation; Federal Acquisition Circular 
2005-13; Introduction

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

ACTION: Summary presentation of final and interim rules, and technical 
amendments and corrections.


SUMMARY: This document summarizes the Federal Acquisition Regulation 
(FAR) rules agreed to by the Civilian Agency Acquisition Council and 
the Defense Acquisition Regulations Council in this Federal Acquisition 
Circular (FAC) 2005-13. A companion document, the Small Entity 
Compliance Guide (SECG), follows this FAC. The FAC, including the SECG, 
is available via the Internet at http://www.regulations.gov.

DATES: For effective dates and comment dates, see separate documents 
which follow.

FOR FURTHER INFORMATION CONTACT: The analyst whose name appears in the 
table below in relation to each FAR case or subject area. Please cite 
FAC 2005-13 and specific FAR case number(s). For information pertaining 
to status or publication schedules, contact the FAR Secretariat at 
(202) 501-4755.

                                          List of Rules in FAC 2005-13
      Item                          Subject                             FAR case                 Analyst
*I.............  Implement OMB Policy on the Use of Brand Name  2005-037                 Davis.
                  Specifications (Interim).
*II............  Information Technology Security..............  2004-018                 Davis.
III............  Online Representations and Certifications      2005-025                 Woodson.
                  Application (ORCA) Archiving Capability
*IV............  Inflation Adjustment of Acquisition-Related    2004-033                 Jackson.
V..............  Trade Agreements-Thresholds..................  2005-030                 Parnell.
VI.............  Reporting of Purchases from Overseas Sources   2005-034                 Olson.
*VII...........  Exception to the Buy American Act for          2005-022                 Olson.
                  Commercial Information Technology.
VIII...........  Technical Amendments.........................  .......................  .......................

SUPPLEMENTARY INFORMATION: Summaries for each FAR rule follow. For the 
actual revisions and/or amendments to these FAR cases, refer to the 
specific item number and subject set forth in the documents following 
these item summaries.
    FAC 2005-13 amends the FAR as specified below:

Item I--Implement OMB Policy on the Use of Brand Name Specifications 
(Interim) (FAR Case 2005-037)

    This interim rule amends the Federal Acquisition Regulation (FAR) 
to implement the memoranda issued by the Office of Management and 
Budget dated April 11, 2005 and April 17, 2006, requiring agencies to 
publish on the Governmentwide point of entry (GPE) or e-Buy the 
documentation required by the FAR to support the use of a brand name 
specification. The rule is intended to limit the use of brand name 
specifications and provide for maximum competition.

Item II--Information Technology Security (FAR Case 2004-018)

    This final rule amends the interim rule published September 30, 
2005, as corrected on November 14, 2005, to a final rule without 
change. The interim rule amended FAR Parts 1, 2, 7, 11, and 39 to 
implement the Information Technology (IT) Security provisions of the 
Federal Information Security Management Act of 2002 (FISMA), (Title III 
of Public Law 107-347, the E-Government Act of 2002 (E-Gov Act)). The 
rule focuses on the importance of system and data security by 
contracting officials and other members of the acquisition team. The 
intent of adding specific guidance in the FAR is to provide clear, 
consistent guidance to acquisition officials and program managers; and 
to encourage and strengthen communication with IT security officials, 
chief information officers, and other affected parties.

Item III--Online Representations and Certifications Application (ORCA) 
Archiving Capability (Interim)(FAR Case 2005-025)

    This interim rule amends FAR Parts 4, 12, 14, and 15 to address the 
record retention policy where the Online Representations and 
Certifications Application (ORCA) is used to submit an offeror's 
representations and certifications. Under FAR Subpart 4.12, prospective 
contractors are required to submit Annual Representations and 
Certifications via the ORCA. Data in ORCA is archived and 
electronically retrievable. Therefore, when a prospective contractor 
has completed representations and certifications electronically via 
ORCA, the contracting officer may reference the date of ORCA 
verification in the associated Government contract file rather than 
including a paper copy of the electronically-submitted representations 
and certifications in the file. Such a reference satisfies contract 
file documentation requirements of 4.803(a)(11). However, if an offeror 
identifies changes to ORCA data pursuant to the FAR provisions at 
52.204-8(c) or 52.212-3(k), the contracting officer must include a copy 
of the changes in the contract file.

Item IV--Inflation Adjustment of Acquisition-Related Thresholds (FAR 
Case 2004-033)

    This final rule adjusts acquisition-related thresholds in the FAR 
for inflation. It implements Section 807 of the Ronald W. Reagan 
National Defense Authorization Act for Fiscal Year 2005 (Pub. L. 108-
375). Section 807 provides for adjustment every 5 years of acquisition-
related thresholds, except for Davis-Bacon Act, Service Contract Act, 
and trade agreements thresholds. This rule also escalates some 
nonstatutory acquisition-related thresholds. Often any impact of these 
threshold increases will be beneficial, by preventing burdensome 
requirements from applying to more and more small dollar value 
acquisitions, which are the acquisitions in which small businesses are 
most likely to participate. One threshold change in this rule which may 
temporarily impact small business is the increase of the micro-purchase 
threshold (FAR 2.101) from $2,500 to

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$3,000, because the simplified acquisition threshold will not be raised 
at this time. Other frequently used thresholds that are adjusted 
     The FPDS reporting threshold (FAR 4.602(c)) will be raised 
from $2,500 to $3,000.
     Commercial Items test program ceiling (FAR 13.500) will be 
raised from $5,000,000 to $5,500,000.
     The cost and pricing data threshold (FAR 15.403-4) will be 
raised from $550,000 to $650,000.
    The prime contractor subcontracting plan (FAR 19.702) floor will be 
raised from $500,000 to $550,000, but for construction ($1,000,000) is 

Item V--Trade Agreements-Thresholds (FAR Case 2005-030)

    This final rule converts the interim rule published at 71 FR 864, 
January 5, 2006, to a final rule without change. This rule changes the 
thresholds for application of the World Trade Organization Government 
Procurement Agreement and the other Free Trade Agreements with Canada, 
Mexico, Chile, Singapore, and Australia. These threshold increases 
occur every two years in order to keep pace with inflation.

Item VI--Reporting of Purchases from Overseas Sources (Interim) (FAR 
Case 2005-034)

    This interim rule amends FAR Part 25 and adds a provision in FAR 
52.225 to implement Section 837 of Division A of the Transportation, 
Treasury, Housing and Urban Development, the Judiciary, the District of 
Columbia, and Independent Agencies Appropriations Act, 2006 (Pub. L. 
109-115). Section 837 requires the head of each Federal agency to 
submit a report to Congress relating to acquisitions of articles, 
materials, or supplies that are manufactured outside the United States. 
The new provision requests from offerors necessary data regarding place 
of manufacture. The new provisions will require an offeror to indicate 
whether the place of manufacture of the end products it expects to 
provide in response to the solicitation is predominantly inside or 
outside the United States. Whenever the place of manufacture for a 
contract is coded outside the United States, the contracting officer 
will be required to enter into Federal Procurement Data System (FPDS) 
the reason for buying items manufactured outside the United States.

Item VII--Exception to the Buy American Act for Commercial Information 
Technology (FAR Case 2005-022)

    This final rule converts the interim rule published at 71 FR 223, 
January 3, 2006, to a final rule without change. This final rule amends 
FAR 25.103 and Subpart 25.11 to implement Section 535(a) of Division F 
of the Consolidated Appropriations Act, 2004, and similar sections in 
subsequent appropriations acts. Section 535(a) authorizes an exception 
to the Buy American Act for acquisitions of information technology that 
are commercial items. The final rule applies to all offerors responding 
to solicitations for commercial information technology where the Buy 
American Act previously applied (generally, acquisitions between the 
micro-purchase threshold and $193,000). The effect of this exemption is 
that the following clauses are no longer applicable in acquisition of 
commercial information technology:
     FAR 52.225-1, Buy American Act-Supplies,
     FAR 52.225-2, Buy American Act Certificate,
     FAR 52.225-3, Buy American Act-Free Trade Agreements-
Israeli Trade Act,
     FAR 52.225-4, Buy American Act-Free Trade Agreements-
Israeli Trade Act Certificate.
    This is because the Buy American Act no longer applies. The Free 
Trade Agreement non-discriminatory provisions are no longer necessary 
since all products now are treated without the restrictions of the Buy 
American Act.
    The Trade Agreements provision and clause at FAR 52.225-5 and FAR 
52.225-6 are still necessary when the Trade Agreements Act applies 
(acquisitions above $193,000). The Trade Agreements provision and 
clause already waive applicability of the Buy American Act for eligible 
products and are needed to implement the restrictions on procurement of 
noneligible end products. Section 535 and subsequent similar sections 
waived only the Buy American Act, not all restrictions on the purchase 
of foreign information technology.

Item VIII--Technical Amendments

    Editorial changes are made at FAR 1, 3, 4, 5, 7, 13, 26, 33, 49, 
50, 52, and 53 in order to update references.

    Dated: September 19, 2006.
Ralph De Stefano,
Director, Contract Policy Division.

Federal Acquisition Circular

    Federal Acquisition Circular (FAC) 2005-13 is issued under the 
authority of the Secretary of Defense, the Administrator of General 
Services, and the Administrator for the National Aeronautics and Space 
    Unless otherwise specified, all Federal Acquisition Regulation 
(FAR) and other directive material contained in FAC 2005-13 is 
effective September 28, 2006.

    Dated: September 19, 2006.
Roger D. Waldron,
Acting Senior Procurement Executive, General Services Administration.

    Dated: September 8, 2006.
Shay D. Assad,
Director, Defense Procurement and Acquisition Policy.

    Dated: September 12, 2006.
Thomas Luedtke,
Assistant Administrator for Procurement, National Aeronautics and Space 
[FR Doc. 06-8199 Filed 9-27-06; 8:45 am]