[Federal Register Volume 77, Number 12 (Thursday, January 19, 2012)]
[Proposed Rules]
[Pages 2679-2680]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-969]


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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Part 204

[DFARS Case 2012-D002]
RIN 0750-AH56


Defense Federal Acquisition Regulation Supplement: Order of 
Application for Modifications

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

ACTION: Proposed rule.

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SUMMARY: DoD is proposing to amend the Defense Federal Acquisition 
Regulation Supplement to establish an order for application of contract 
modifications to resolve any potential conflicts that may arise from 
multiple modifications with the same effective date.

DATES: Comments on the proposed rule should be submitted in writing to 
the address shown below on or before March 19, 2012, to be considered 
in the formation of the final rule.

ADDRESSES: Submit comments identified by DFARS case 2012-D002, using 
any of the following methods:
    [cir] Regulations.gov: http://www.regulations.gov. Submit comments 
via the Federal eRulemaking portal by inputting ``DFARS Case 2012-
D002'' under the heading ``Enter keyword or ID'' and selecting 
``Search.'' Select the link ``Submit a Comment'' that corresponds with 
``DFARS Case 2012-D002.'' Follow the instructions provided at the 
``Submit a Comment'' screen. Please include your name, company name (if 
any), and ``DFARS Case 2012-D002'' on your attached document.
    [cir] Email: [email protected]. Include DFARS Case 2012-D002 in the 
subject line of the message.
    [cir] Fax: (703) 602-0350.
    [cir] Mail: Defense Acquisition Regulations System, Attn: Mr. 
Julian Thrash, OUSD (AT&L) DPAP/DARS, Room 3B855, 3060 Defense 
Pentagon, Washington, DC 20301-3060.
    Comments received generally will be posted without change to http://www.regulations.gov, including any personal information provided. To 
confirm receipt of your comment(s), please check www.regulations.gov, 
approximately two to three days after submission to verify posting 
(except allow 30 days for posting of comments submitted by mail).

FOR FURTHER INFORMATION CONTACT: Mr. Julian Thrash, (703) 602-0310.

SUPPLEMENTARY INFORMATION:

I. Background

    The Defense Federal Acquisition Regulation Supplement (DFARS) 
subpart 204.70, Uniform Procurement Instrument Identification Numbers, 
prescribes numbering procedures for contract modifications and the 
Federal Acquisition Regulation (FAR) part 43.1, General, prescribes 
rules for determining the effective date. There are no rules to 
describe in what order to apply modifications to determine the actual 
content of a resulting modified contract. In order to determine the 
sequence of modifications to a contract or order, a method for 
determining the order of application for modifications is needed to 
resolve any conflict arising from multiple modifications with the same 
effective date. As such, this rule proposes to add DFARS text at 
204.7007, Order of Application for Modifications, to resolve any 
potential inconsistency.

II. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). E.O. 
13563 emphasizes the importance of quantifying both costs and benefits, 
of reducing costs, of harmonizing rules, and of promoting flexibility. 
This is not a significant regulatory action and, therefore, was not 
subject to review under section 6(b) of E.O. 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 does 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 this rule only affects the internal operating processes of DoD 
by clarifying an order of application for contract modifications, and 
it does not have an economic impact on contractors. However, an initial 
regulatory flexibility analysis has been performed and is summarized as 
follows:
    The objective for this case is to provide a set of rules to the 
contracting officer to resolve any potential conflict from multiple 
modifications with the same effective date. The changes

[[Page 2680]]

required to the DFARS by this case only affect the internal operating 
processes of DoD by establishing an order of application for contract 
modifications. These changes are not expected to have a significant 
economic impact on contractors.
    This rule does not impose any new reporting or recordkeeping 
requirements.
    The rule does not duplicate, overlap, or conflict with any other 
Federal rules. The alternative to this rule is to continue relying on 
DFARS subpart 204.70, which prescribes numbering procedures for 
contract modifications, and FAR subpart 43.1, which provides guidelines 
for determining the effective date. However, the cited text does not 
provide a clear structured path to ensure no ambiguity arises when 
determining what order to apply modifications.
    DoD invites comments from small business concerns and other 
interested parties on the expected impact of this rule on small 
entities.
    DoD will also consider comments from small entities concerning the 
existing regulations in subparts affected by this rule in accordance 
with 5 U.S.C. 610. Interested parties must submit such comments 
separately and should cite 5 U.S.C. 610 (DFARS Case 2012-D002) in the 
correspondence.

IV. Paperwork Reduction Act

    This rule does not impose any new information collection 
requirements that require the approval of the Office of Management and 
Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

List of Subjects in 48 CFR Part 204

    Government procurement.

Mary Overstreet,
Editor, Defense Acquisition Regulations System.

    Therefore, 48 CFR part 204 is proposed to be amended as follows:
    1. The authority citation for 48 CFR part 204 is revised to read as 
follows:

    Authority:  41 U.S.C. 1303 and 48 CFR chapter 1.

PART 204--ADMINISTRATIVE MATTERS

    2. Add section 204.7007 to read as follows:


204.7007  Order of application for modifications.

    (a) Circumstances may exist in which the numeric order of the 
modifications to a contract is not the order in which the changes to 
the contract actually take effect.
    (b) In order to determine the sequence of modifications to a 
contract or order, the modifications will be applied in the following 
order:
    (1) Modifications will be applied in order of the effective date on 
the modification.
    (2) In the event of two or more modifications with the same 
effective date, modifications will be applied in signature date order.
    (3) In the event of two or more modifications with the same 
effective date and the same signature date, procuring contracting 
office modifications will be applied in numeric order, followed by 
contract administration office modifications in numeric order.

[FR Doc. 2012-969 Filed 1-18-12; 8:45 am]
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