[Federal Register Volume 75, Number 226 (Wednesday, November 24, 2010)]
[Rules and Regulations]
[Pages 71562-71563]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-29498]


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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 217, 234, and 235

RIN 0750-AG76


Defense Federal Acquisition Regulation Supplement; Contract 
Authority for Advanced Component Development or Prototype Units (DFARS 
Case 2009-D034)

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

ACTION: Confirmation of interim final rule.

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[[Page 71563]]

SUMMARY: DoD is adopting as final, with a minor change, an interim rule 
amending the DFARS to implement section 819 of the National Defense 
Authorization Act for Fiscal Year 2010. Section 819 places limitations 
on certain types of line items and contract options that may be 
included in contracts initially awarded pursuant to competitive 
solicitations.

DATES: Effective Date: November 24, 2010.

FOR FURTHER INFORMATION CONTACT: Ms. Meredith Murphy, 703-602-1302.

SUPPLEMENTARY INFORMATION:

I. Background

    DoD published an interim rule in the Federal Register at 75 FR 
32638 on June 8, 2010, to implement section 819 of the National Defense 
Authorization Act for Fiscal Year 2010. The interim rule added coverage 
at DFARS 217.202 and 234.005-1. The intent of the statute is to prevent 
a contract for new technology that is initially awarded as a result of 
competition, from becoming a noncompetitive effort for the development 
of advance components or the procurement of prototype units. The DFARS 
implementation places specific limits, in accordance with the statute, 
on the dollar value, period of performance, and time for exercise of 
contract line items or contract options for such contracts.
    The comment period closed on August 9, 2010. A single comment was 
received in response to the interim rule. The respondent commented that 
including the change in DFARS part 234 will result in users following 
this requirement only when procuring major systems. This issue was 
raised during the preparation of the interim rule. DoD confirmed that 
part 234 is the optimal location, but has added to DFARS part 235, 
Research and Development Contracting, a second cross-reference to the 
part 234 coverage.

II. Executive Order 12866

    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.

III. 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 changes are to internal Government operating procedures. 
Specifically, the final rule implements section 819 of the National 
Defense Authorization Act for Fiscal Year 2010. Section 819 places 
limitations on certain types of line items and contract options that 
may be included in contracts initially awarded pursuant to competitive 
solicitations. When the prohibition applies, it limits the dollar 
value, period of performance, and time for exercise of such contract 
line items or contract options. The intent of the final rule is to 
prevent a contract for new technology that is initially awarded as a 
result of competition from becoming a noncompetitive effort for the 
development of advanced components or the procurement of prototype 
units.

IV. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the final 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 217, 234, and 235

    Government procurement.

Clare M. Zebrowski,
Editor, Defense Acquisition Regulations System.

Interim Rule Adopted as Final With Changes

0
Accordingly, the interim rule amending 48 CFR parts 217 and 234, which 
was published in the Federal Register at 75 FR 32638 on June 8, 2010, 
is adopted as final with the following changes:
0
1. The authority citation for 48 CFR parts 217, 234, and 235 continues 
to read as follows:

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

PART 235--RESEARCH AND DEVELOPMENT CONTRACTING

0
2. Section 235.006-71 is added to subpart 235.006 to read as follows:


235.006-71  Competition.

    See 234.005-1 for limitations on the use of contract line items or 
contract options for the provision of advanced component development or 
prototypes of technology developed under a competitively awarded 
proposal.

[FR Doc. 2010-29498 Filed 11-23-10; 8:45 am]
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