[Federal Register Volume 77, Number 224 (Tuesday, November 20, 2012)]
[Rules and Regulations]
[Pages 69720-69723]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-27905]


-----------------------------------------------------------------------

DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 4 and 17

[FAC 2005-62; FAR Case 2012-010; Item II; Docket 2012-0010, Sequence 
01]
RIN 9000-AM36


Federal Acquisition Regulation; Interagency Acquisitions: 
Compliance by Nondefense Agencies With Defense Procurement Requirements

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

ACTION: Interim rule.

-----------------------------------------------------------------------

SUMMARY: DoD, GSA, and NASA are issuing an interim rule amending the 
Federal Acquisition Regulation (FAR) to add new requirements specific 
to the acquisition of supplies and services by nondefense agencies on 
behalf of the DoD. This rule implements a section of the National 
Defense Authorization Act for Fiscal Year 2008, with later amendments.

DATES: Effective date: November 20, 2012.
    Comment date: Interested parties should submit written comments to 
the Regulatory Secretariat on or before January 22, 2013 to be 
considered in the formation of a final rule.

ADDRESSES: Submit comments identified by FAC 2005-62, FAR Case 2012-
010, by any of the following methods:
     Regulations.gov: http://www.regulations.gov.
    Submit comments via the Federal eRulemaking portal by searching for 
``FAR Case 2012-010''. Select the link ``Submit a Comment'' that 
corresponds with ``FAR Case 2012-010.'' Follow the instructions 
provided at the ``Submit a Comment'' screen. Please include your name, 
company name (if any), and ``FAR Case 2012-010'' on your attached 
document.
     Fax: 202-501-4067.
     Mail: General Services Administration, Regulatory 
Secretariat (MCVB), ATTN: Hada Flowers, 1275 First Street NE., 7th 
Floor, Washington, DC 20417.
    Instructions: Please submit comments only and cite FAC 2005-62, FAR 
Case 2012-010 in all correspondence related to this case. All comments 
received will be posted without change to http://www.regulations.gov, 
including any personal and/or business confidential information 
provided.

FOR FURTHER INFORMATION CONTACT: Ms. Patricia Corrigan, Procurement 
Analyst, at 202-208-1963 for clarification of content. For information 
pertaining to status or publication schedules, contact the Regulatory 
Secretariat at 202-501-4755. Please cite FAC 2005-62, FAR Case 2012-
010.

SUPPLEMENTARY INFORMATION: 

I. Background

    DoD, GSA, and NASA are publishing this interim rule amending the 
FAR to implement the requirements of section 801 of the National 
Defense Authorization Act (NDAA) for Fiscal Year (FY) 2008 (Pub. L. 
110-181), as amended, (10 U.S.C. 2304 note).
    Section 801 of the NDAA for FY 2008, titled ``Internal Controls for 
Procurement on Behalf of the Department of Defense by Certain 
Nondefense Agencies,'' defines in general terms the ``procurement 
policies, procedures, and internal controls'' that constitute 
compliance with defense procurement requirements by a nondefense agency 
when it procures supplies and services on behalf of the DoD. Section 
801(b) states, in part, that unless waived, a DoD acquisition official 
may place an order, make a purchase, or otherwise procure property or 
services for DoD in excess of the simplified acquisition threshold 
through a nondefense agency only if the nondefense agency conducting 
the acquisition on DoD's behalf has certified that it will comply with 
defense procurement requirements for that fiscal year.
    Section 804 of the Duncan Hunter NDAA for FY 2009 (Pub. L. 110-417) 
amended the list of covered nondefense agencies established in previous 
NDAAs, and established deadlines for reviews of covered nondefense 
agencies. (The term ``covered nondefense agency'' is included in the 
definition of nondefense agencies of section 801 of the NDAA for FY 
2008.)
    Section 806 of the NDAA for FY 2010 (Pub. L. 111-84), titled 
``Treatment of Nondefense Agency Procurements Under Joint Programs with 
Intelligence Community,'' amended section 801(b) of the NDAA for FY 
2008 by authorizing exclusions from section 801 internal control 
limitations for contracts entered into under joint programs for DoD and 
non-DoD elements of the intelligence community.
    Section 817 of the NDAA for FY 2012 (Pub. L. 112-81), titled 
``Compliance with Defense Procurement Requirements for Purposes of 
Internal Controls of Nondefense Agencies for Procurements of Behalf of 
the Department of Defense,'' amended section 801(d) of the NDAA for FY 
2008 (10 U.S.C. 2304 note) to provide clarifying language that 
identifies the types of laws and regulations with which nondefense 
departments and agencies must comply when procuring supplies and 
services on behalf of DoD. Specifically, section 817 clarifies that the 
nondefense agency certification of ``compliance with defense 
procurement requirements'' for a given fiscal year means compliance 
with (1) the FAR and other laws and regulations that apply to 
procurements of property and services by Federal agencies, and (2) laws 
and regulations (including DoD financial management regulations) that 
apply to procurements of property and services made by DoD through 
other Federal agencies.
    This interim rule makes the following changes:
     Clarifies FAR 4.603(c) regarding the allocation of 
socioeconomic credit to the requesting agency for assisted 
acquisitions.
     Adds to FAR 17.500(a) a cross-reference to the new FAR 
subpart 17.7 for additional requirements for nondefense agencies when 
acquiring supplies and services on behalf of DoD;
     Adds to FAR 17.502-1(b)(1)(i) a requirement for written 
confirmation by the requesting agency to the servicing agency in the 
event there are no agency unique requirements beyond the FAR that apply 
to an assisted acquisition.

[[Page 69721]]

     Cross-references new FAR subpart 17.7, Interagency 
Acquisitions: Acquisitions by Nondefense Agencies on Behalf of the 
Department of Defense, at 17.502-1(b)(1)(i) related to assisted 
acquisitions.
     Creates a new FAR subpart FAR 17.7 applicable to the 
acquisition of supplies and services by nondefense agencies on behalf 
of DoD.
     Creates a new FAR section 17.700 identifying the scope of 
the subpart.
     Creates a new FAR section 17.701 providing definitions 
specific to subpart 17.7.
     Creates a new FAR section 17.702 establishing the 
subpart's applicability to all acquisitions made by nondefense agencies 
on behalf of DoD except for contracts for joint projects with DoD 
entered into by a nondefense agency that is an element of the 
intelligence community.
     Creates a new FAR section 17.703, which establishes the 
policy related to internal controls and compliance certification under 
which nondefense agencies may procure supplies and services on behalf 
of DoD and identifies DoD acquisition official responsibilities when 
making acquisitions on behalf of DoD.

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, GSA, and NASA do not expect this 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. 
Nevertheless, an Initial Regulatory Flexibility Analysis (IRFA) has 
been prepared and is summarized as follows.

    Section 801 of the NDAA for FY 2008 (Pub. L. 110-181), section 
806 of the NDAA for FY 2010 (Pub. L. 111-84), and section 817 of the 
NDAA for FY 2012 (Pub. L. 112-81) address requirements specific to 
the acquisition of supplies and services by nondefense agencies on 
behalf of DoD, and are, therefore, internal to the Government. 
However, this case also adds a clarification at FAR 4.603(c), 
restating existing Office of Federal Procurement Policy (OFPP) and 
Federal Procurement Data System (FPDS) policy regarding the 
allocation of socioeconomic credit for interagency acquisitions. 
Although DoD, GSA, and NASA do not expect the clarification to have 
a direct economic impact on a substantial number of small entities, 
there is the possibility that the regulatory clarification may 
improve the accuracy of FPDS data submissions related to the 
allocation of socioeconomic credit to agencies for contracts and 
orders awarded to a substantial number of small entities. Improved 
data accuracy can have a positive impact on agencies' annual small 
business goals.

    The Regulatory Secretariat has submitted a copy of the IRFA to the 
Chief Counsel for Advocacy of the Small Business Administration. A copy 
of the IRFA may be obtained from the Regulatory Secretariat. DoD, GSA, 
and NASA invite comments from small business concerns and other 
interested parties on the expected impact of this rule on small 
entities.
    DoD, GSA, and NASA will also consider comments from small entities 
concerning the existing regulations in subparts affected by this rule 
consistent with 5 U.S.C. 610. Interested parties must submit such 
comments separately and should cite 5 U.S.C. 610 (FAC 2005-62, FAR Case 
2012-010) in correspondence.

IV. Paperwork Reduction Act

    The interim rule does not contain any 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).

V. Determination To Issue an Interim Rule

    Pursuant to the Office of Federal Procurement Policy (OFPP) 
Reauthorization Act, the Secretary of Defense, the Administrator of 
General Services, and the Administrator of NASA have determined that 
urgent and compelling reasons exist to promulgate this interim rule 
without prior opportunity for public comment. This action is necessary 
because the NDAA for FY 2012 (Pub. L. 112-81) was enacted on December 
31, 2011, and was effective upon enactment. Recognizing this, the FAR 
Principals opened FAR Case 2012-010 on January 19, 2012. Section 817 of 
the NDAA for FY 2012 amended section 801(d) of the NDAA for FY 2008 (10 
U.S.C. 2304 note) to provide necessary clarifying language that 
identifies the types of laws and regulations with which nondefense 
departments and agencies must comply when procuring supplies and 
services on behalf of DoD. Specifically, section 817 clarifies that the 
nondefense agency certification of ``compliance with defense 
procurement requirements'' for a given fiscal year means compliance 
with (1) the FAR and other laws and regulations that apply to 
procurements of property and services by Federal agencies, and (2) laws 
and regulations (including DoD financial management regulations) that 
apply to procurements of property and services made by DoD through 
other Federal agencies. If this rule, which also informs nondefense 
agencies regarding their responsibilities when buying on behalf of DoD, 
is not implemented as an interim rule, it will negatively impact the 
accuracy and completeness of nondefense agency certifications for 
fiscal year 2013.
    Every effort has been made to process this FAR requirement in an 
expeditious manner. Processing this rule as an interim rule, with an 
immediate effective date, will ensure that nondefense agencies 
conducting acquisitions on behalf of DoD are fully informed of DoD 
expectations and their responsibilities when nondefense agency senior 
management completes the statutorily-mandated certifications for fiscal 
year 2013. This requirement does not directly impact the public and is 
purely an administrative FAR change that affects Government agencies 
that conduct acquisitions on behalf of DoD.
    However, pursuant to 41 U.S.C. 1707 and FAR 1.501-3(b), DoD, GSA, 
and NASA will consider public comments received in response to this 
interim rule in the formation of the final rule.

List of Subjects in 48 CFR Parts 4 and 17

    Government procurement.

    Dated: November 9, 2012.
Laura Auletta,
Director, Office of Governmentwide Acquisition Policy, Office of 
Acquisition Policy, Office of Governmentwide Policy.

    Therefore, DoD, GSA, and NASA amend 48 CFR parts 4 and 17 as set 
forth below:

0
1. The authority citation for 48 CFR parts 4 and 17 is revised to read 
as follows:

    Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 
U.S.C. 20113.

PART 4--ADMINISTRATIVE MATTERS

0
2. Amend section 4.603 by adding two sentences to the end of paragraph 
(c) to read as follows:

[[Page 69722]]

4.603  Policy.

* * * * *
    (c) * * * For assisted acquisitions, the requesting agency will 
receive socioeconomic credit for meeting agency small business goals, 
where applicable. Requesting agencies shall provide the appropriate 
agency/bureau component code as part of the written interagency 
agreement between the requesting and servicing agencies (see 17.502-
1(b)(1)).
* * * * *

PART 17--SPECIAL CONTRACTING METHODS

0
3. Amend section 17.500 by adding a new sentence to the end of 
paragraph (a) to read as follows:


17.500  Scope of subpart.

    (a) * * * In addition to complying with the interagency acquisition 
policy and procedures in this subpart, nondefense agencies acquiring 
supplies and services on behalf of the Department of Defense shall also 
comply with the policy and procedures at subpart 17.7.
* * * * *

0
4. Amend section 17.502-1 by revising paragraph (b)(1)(i) to read as 
follows:


17.502-1  General.

* * * * *
    (b) * * *
    (1) * * *
    (i) Prior to the issuance of a solicitation, the servicing agency 
and the requesting agency shall both sign a written interagency 
agreement that establishes the general terms and conditions governing 
the relationship between the parties, including roles and 
responsibilities for acquisition planning, contract execution, and 
administration and management of the contract(s) or order(s). The 
requesting agency shall provide to the servicing agency any unique 
terms, conditions, and applicable agency-specific statutes, 
regulations, directives, and other applicable requirements for 
incorporation into the order or contract. In the event there are no 
agency unique requirements beyond the FAR, the requesting agency shall 
so inform the servicing agency contracting officer in writing. For 
acquisitions on behalf of the Department of Defense, also see subpart 
17.7. For patent rights, see 27.304-2. In preparing interagency 
agreements to support assisted acquisitions, agencies should review the 
Office of Federal Procurement Policy guidance, Interagency 
Acquisitions, available at http://www.whitehouse.gov/omb/assets/procurement/iac_revised.pdf.
* * * * *

0
5. Add Subpart 17.7 to read as follows:
Subpart 17.7--Interagency Acquisitions: Acquisitions by Nondefense 
Agencies on Behalf of the Department of Defense
Sec.
17.700 Scope of subpart.
17.701 Definitions.
17.702 Applicability.
17.703 Policy.

Subpart 17.7--Interagency Acquisitions: Acquisitions by Nondefense 
Agencies on Behalf of the Department of Defense


17.700  Scope of subpart.

    (a) Compliance with this subpart is in addition to the policies and 
procedures for interagency acquisitions set forth in subpart 17.5. This 
subpart prescribes policies and procedures specific to acquisitions of 
supplies and services by nondefense agencies on behalf of the 
Department of Defense (DoD).
    (b) This subpart implements Public Law 110-181, section 801, as 
amended (10 U.S.C. 2304 Note).


17.701  Definitions.

    As used in this subpart--
    Department of Defense (DoD) acquisition official means--
    (1) A DoD contracting officer; or
    (2) Any other DoD official authorized to approve a direct 
acquisition or an assisted acquisition on behalf of DoD.
    Nondefense agency means any department or agency of the Federal 
Government other than the Department of Defense.
    Nondefense agency that is an element of the intelligence community 
means the agencies identified in 50 U.S.C. 401a(4), which include the--
    (1) Office of the Director of National Intelligence;
    (2) Central Intelligence Agency;
    (3) Intelligence elements of the Federal Bureau of Investigation, 
Department of Energy, and Drug Enforcement Agency;
    (4) Bureau of Intelligence and Research of the Department of State;
    (5) Office of Intelligence and Analysis of the Department of the 
Treasury;
    (6) The Office of Intelligence and Analysis of the Department of 
Homeland Security and the Office of Intelligence of the Coast Guard; 
and
    (7) Such other elements of any department or agency as have been 
designated by the President, or designated jointly by the Director of 
National Intelligence and the head of the department or agency 
concerned, as an element of the intelligence community.


17.702  Applicability.

    This subpart applies to all acquisitions made by nondefense 
agencies on behalf of DoD. It does not apply to contracts entered into 
by a nondefense agency that is an element of the intelligence community 
for the performance of a joint program conducted to meet the needs of 
DoD and the nondefense agency.


17.703  Policy.

    (a) A DoD acquisition official may request a nondefense agency to 
conduct an acquisition on behalf of DoD in excess of the simplified 
acquisition threshold only if the head of the nondefense agency 
conducting the acquisition on DoD's behalf has certified that the 
agency will comply with defense procurement requirements for that 
fiscal year except when waived in accordance with paragraph (e) of this 
section.
    (b) A nondefense agency is compliant with defense procurement 
requirements if the procurement policies, procedures, and internal 
controls of the nondefense agency applicable to the procurement of 
supplies and services on behalf of DoD, and the manner in which they 
are administered, are adequate to ensure the compliance of the 
nondefense department or agency with--
    (1) The Federal Acquisition Regulation and other laws and 
regulations that apply to procurements of supplies and services by 
Federal agencies; and
    (2) Laws and regulations that apply to procurements of supplies and 
services made by DoD through other Federal agencies, including DoD 
financial management regulations, the Defense Federal Acquisition 
Regulation Supplement (DFARS), and the DFARS Procedures, Guidance, and 
Information (PGI). (The DFARS and PGIs are accessible at: http://www.acq.osd.mil/dpap/).
    (c) Within 30 days of the beginning of each fiscal year, submit 
nondefense agency certifications of compliance to the Director, Defense 
Procurement and Acquisition Policy, Department of Defense, 3060 Defense 
Pentagon, Washington DC 20301-3060.
    (d) The DoD acquisition official, as defined at 17.701, shall 
provide to the servicing nondefense agency contracting officer any DoD-
unique terms, conditions, other related statutes, regulations, 
directives, and other applicable requirements for incorporation into 
the order or contract. In the event there are no DoD-unique

[[Page 69723]]

requirements beyond the FAR, the DoD acquisition official shall so 
inform the servicing nondefense agency contracting officer in writing. 
Nondefense agency contracting officers are responsible for ensuring 
support provided in response to DoD's request complies with paragraph 
(b) of this section.
    (e) Waiver. The limitation in paragraph (a) of this section shall 
not apply to the acquisition of supplies and services on behalf of DoD 
by a nondefense agency during any fiscal year for which the Under 
Secretary of Defense for Acquisition, Technology, and Logistics has 
determined in writing that it is necessary in the interest of DoD to 
acquire supplies and services through the nondefense agency during the 
fiscal year. The written determination shall identify the acquisition 
categories to which the waiver applies.
    (f) Nondefense agency certifications, waivers, and additional 
information are available at http://www.acq.osd.mil/dpap/cpic/cp/interagency_acquisition.html.

[FR Doc. 2012-27905 Filed 11-19-12; 8:45 am]
BILLING CODE 6820-EP-P