[Federal Register Volume 77, Number 228 (Tuesday, November 27, 2012)]
[Rules and Regulations]
[Pages 70708-70710]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-28612]



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DEPARTMENT OF VETERANS AFFAIRS

48 CFR Parts 832 and 852

RIN 2900-AN97


VA Acquisition Regulation: Electronic Submission of Payment 
Requests

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: The Department of Veterans Affairs (VA) is issuing a final 
rule to require contractors to submit payment requests in electronic 
form in order to enhance customer service, departmental productivity, 
and adoption of innovative information technology, including the 
appropriate use of commercial best practices. This document adopts the 
proposed rule published on April 18, 2012, as a final rule with a non-
substantive technical change.

DATES: Effective Date: This rule is effective December 27, 2012.

FOR FURTHER INFORMATION CONTACT: James Trudeau, Procurement Policy 
Service (003A2A), Office of Acquisition and Logistics, Department of 
Veterans Affairs, 810 Vermont Ave., NW., Washington, DC 20420, (202) 
461-5661. (This is not a toll free number.)

SUPPLEMENTARY INFORMATION: On July 7, 2009, VA published a notice, in 
the Federal Register at 74 FR 32223, of a class deviation to Federal 
Acquisition Regulation (FAR) 32.905 (48 CFR 32.905), which added an 
interim electronic invoicing clause in the VA Acquisition Regulation 
(VAAR). The interim clause encouraged contractors to voluntarily submit 
invoices electronically, which VA determined would improve the accuracy 
and efficiency of payment processing. Under this interim clause, 
contractors who chose to use electronic invoicing had three options to 
submit payment requests in electronic form: (1) Electronic Invoice 
Presentment and Payment System; (2) American National Standards 
Institute (ANSI) X12 electronic data interchange (EDI) formats; or (3) 
another electronic form as prescribed by the contract administration 
office and the designated agency office. VA's notice regarding interim, 
optional electronic invoicing noted VA intended to initiate notice-and-
comment rulemaking to amend the VAAR to make electronic invoicing 
mandatory.
    On April 18, 2012, VA published a proposed rule, in the Federal 
Register at 77 FR 23204, which announced the intent to require 
contractors to submit payment requests in electronic form in order to 
enhance customer service, departmental productivity, and adoption of 
innovative information technology, including the appropriate use of 
commercial best practices.
    We provided a 60-day comment period for interested parties to 
submit comments to VA on or before June 18, 2012. We received no 
comments.
    Based on the rationale set forth in the proposed rule and this 
document, we are adopting the proposed rule as a final rule without any 
substantive changes. We are renumbering proposed subpart ``832.10'' and 
VAAR ``832.1001,'' ``832.1002,'' ``832.1003,'' ``832.1003-1,'' and 
``832.1003-2'' to read subpart ``832.70'' and VAAR ``832.7000,'' 
``832.7001,'' ``832.7002,'' ``832.7002-1,'' and ``832.7002-2,'' 
respectively, to ensure the VAAR subpart numbering does not conflict 
with the FAR subpart numbering. We are renumbering proposed VAAR 
``852.273-76'' to read ``852.232-72'' to align it with part 832-
Contract Financing. We are also making non-substantive conforming 
changes to the cross references in proposed VAAR 832.1002(c) (now VAAR 
832.7001(c)), VAAR 832.1003-2 (now VAAR 832.7002-2), and VAAR 852.273-
76 (now VAAR 852.232-72).

Executive Orders 12866 and 13563

    Executive Orders 12866 and 13563 direct agencies to assess the 
costs and benefits of available regulatory alternatives and, when 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, and other advantages; distributive impacts; 
and equity). Executive Order 13563 (Improving Regulation and Regulatory 
Review) emphasizes the importance of quantifying both costs and 
benefits, reducing costs, harmonizing rules, and promoting flexibility. 
Executive Order 12866 (Regulatory Planning and Review) defines a 
``significant regulatory action'' requiring review by the Office of 
Management and Budget (OMB) as ``any regulatory action that is likely 
to result in a rule that may: (1) Have an annual effect on the economy 
of $100 million or more or adversely affect in a material way the 
economy, a sector of the economy, productivity, competition, jobs, the 
environment, public health or safety, or State, local, or tribal 
governments or communities; (2) Create a serious inconsistency or 
otherwise interfere with an action taken or planned by another agency; 
(3) Materially alter the budgetary impact of entitlements, grants, user 
fees, or loan programs or the rights and obligations of recipients 
thereof; or (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
this Executive Order.''
    The economic, interagency, budgetary, legal, and policy 
implications of this regulatory action have been examined, and it has 
been determined not to be a significant regulatory action under 
Executive Order 12866.

Regulatory Flexibility Act

    The Secretary hereby 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. 601-612. 
The Secretary acknowledges that this final rule could affect some small 
entities; however, the economic impact was determined not significant 
and is expected to be outweighed by the positive economic impact of the 
final rule. Small entities should realize a positive economic impact as 
a result of electronic invoice submission due to the avoidance of 
traditional invoicing costs such as postage and mailing supplies. VA's 
data transmission methods for electronic invoice submission accommodate 
all existing accounts receivable/billing systems that contractors are 
currently using to submit electronic invoices to VA. As a result, no 
additional hardware or software purchases by contractors are necessary 
to submit electronic invoices. Additionally, the VA electronic invoice 
payment and presentment system is provided to all contractors free of 
charge. No negative economic impact has been reported by small entities 
voluntarily using electronic invoice submission in accordance with the 
existing interim electronic invoicing clause in the VAAR. In 2006, the 
U.S. Government Accountability Office issued a report to Congressional 
Committees titled ``DoD Payments to Small Businesses: Implementation 
and Effective Utilization of Electronic Invoicing Could Further Reduce 
Late Payments'' (GAO-06-358). The report confirmed the effectiveness of 
electronic invoicing in eliminating paper and redundant data entry; 
improving data accuracy; reducing the number of lost or misplaced 
documents; and ultimately, improving timely payments to small 
businesses. Therefore, pursuant to 5 U.S.C. 605(b), this rulemaking is 
exempt from the initial and final regulatory flexibility analysis 
requirements of sections 603 and 604.

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Paperwork Reduction Act

    This final rule does not impose any additional information 
collection requirements requiring approval of OMB under the Paperwork 
Reduction Act of 1995, 44 U.S.C. 3501, et seq. Collections of 
information referenced in VAAR Parts 832 and 852 have previously been 
approved in accordance with OMB prompt payment regulations at 5 CFR 
part 1315. See 64 FR 52580-01. Collections relating to the submission 
and payment of invoices are approved under OMB Control Numbers 9000-
0070 and 0102, which govern the submission of adequate documentation to 
support contractor requests for payment.

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 
1532, that agencies prepare an assessment of anticipated costs and 
benefits before issuing any rule that may result in an expenditure by 
State, local, and tribal governments, in the aggregate, or by the 
private sector, of $100 million or more (adjusted annually for 
inflation) in any one year. This final rule will have no such effect on 
State, local, and tribal governments, or on the private sector.

Catalog of Federal Domestic Assistance

    There is no Catalog of Federal Domestic Assistance program number 
and title for the program in this final rule.

Signing Authority

    The Secretary of Veterans Affairs, or designee, approved this 
document and authorized the undersigned to sign and submit the document 
to the Office of the Federal Register for publication electronically as 
an official document of the Department of Veterans Affairs. John R. 
Gingrich, Chief of Staff, approved this document on November 20, 2012, 
for publication.

List of Subjects

48 CFR Part 832

    Government procurement.

48 CFR Part 852

    Government procurement; Reporting and recordkeeping requirements.

    Dated: November 20, 2012.
Robert C. McFetridge,
Director of Regulation Policy and Management, Office of the General 
Counsel, Department of Veterans Affairs.

    For the reasons set forth in the preamble, the Department of 
Veterans Affairs amends 48 CFR chapter 8 as follows:

PART 832--CONTRACT FINANCING

0
1. The authority citation for part 832 continues to read as follows:

    Authority:  40 U.S.C. 121(c) and 48 CFR 1.301-1.304.


0
2. Add subpart 832.70 to read as follows:
Subpart 832.70--Electronic Invoicing Requirements
832.7000 General.
832.7001 Definitions.
832.7002 Electronic payment requests.
832.7002-1 Data transmission.
832.7002-2 Contract clause.

Subpart 832.70--Electronic Invoicing Requirements


832.7000  General.

    This subpart prescribes requirements and procedures for submitting 
and processing payment requests in electronic form.


832.7001  Definitions.

    As used in this subpart:
    (a) Contract financing payment has the meaning given in FAR 32.001.
    (b) Designated agency office has the meaning given in 5 CFR 
1315.2(m).
    (c) Electronic form means an automated system transmitting 
information electronically according to the accepted electronic data 
transmission methods identified in VAAR 832.7002-1. Facsimile, email, 
and scanned documents are not acceptable electronic forms for 
submission of payment requests.
    (d) Invoice payment has the meaning given in FAR 32.001.
    (e) Payment request means any request for contract financing 
payment or invoice payment submitted by a contractor under a contract.


832.7002  Electronic payment requests.

    (a) The contractor shall submit payment requests in electronic form 
unless directed by the contracting officer to submit payment requests 
by mail. Purchases paid with a Government-wide commercial purchase card 
are considered to be an electronic transaction for purposes of this 
rule, and therefore no additional electronic invoice submission is 
required.
    (b) The contracting officer may direct the contractor to submit 
payment requests by mail, through the United States Postal Service, to 
the designated agency office for:
    (1) Awards made to foreign vendors for work performed outside the 
United States;
    (2) Classified contracts or purchases when electronic submission 
and processing of payment requests could compromise the safeguarding of 
classified or privacy information;
    (3) Contracts awarded by contracting officers in the conduct of 
emergency operations, such as responses to national emergencies;
    (4) Solicitations or contracts in which the designated agency 
office is a VA entity other than the VA Financial Services Center in 
Austin, Texas; or
    (5) Solicitations or contracts in which the VA designated agency 
office does not have electronic invoicing capability as described 
above.


832.7002-1  Data transmission.

    The contractor shall submit electronic payment requests through:
    (a) VA's Electronic Invoice Presentment and Payment System (See Web 
site at http://www.fsc.va.gov/einvoice.asp.); or,
    (b) A system that conforms to the X12 electronic data interchange 
(EDI) formats established by the Accredited Standards Center (ASC) 
chartered by the American National Standards Institute (ANSI). The X12 
EDI Web site (http://www.x12.org) includes additional information on 
EDI 810 and 811 formats.


832.7002-2  Contract clause.

    The contracting officer shall insert the clause at 852.232-72, 
Electronic submission of payment requests, in all solicitations and 
contracts.

PART 852--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
3. The authority citation for part 852 continues to read as follows:

    Authority:  38 U.S.C. 501, 8127, 8128, and 8151-8153; 40 U.S.C. 
121(c) and 48 CFR 1.301-1.304.

Subpart 852.2--Texts of Provisions and Clauses

0
4. Add 852.232-72 to subpart 852.2 to read as follows:


852.232-72  Electronic submission of payment requests.

    As prescribed in 832.7002-2, insert the following clause:

Electronic Submission of Payment Requests (NOV 2012)

    (a) Definitions. As used in this clause--
    (1) Contract financing payment has the meaning given in FAR 
32.001.
    (2) Designated agency office has the meaning given in 5 CFR 
1315.2(m).
    (3) Electronic form means an automated system transmitting 
information electronically according to the accepted

[[Page 70710]]

electronic data transmission methods and formats identified in 
paragraph (c) of this clause. Facsimile, email, and scanned 
documents are not acceptable electronic forms for submission of 
payment requests.
    (4) Invoice payment has the meaning given in FAR 32.001.
    (5) Payment request means any request for contract financing 
payment or invoice payment submitted by the contractor under this 
contract.
    (b) Electronic payment requests. Except as provided in paragraph 
(e) of this clause, the contractor shall submit payment requests in 
electronic form. Purchases paid with a Government-wide commercial 
purchase card are considered to be an electronic transaction for 
purposes of this rule, and therefore no additional electronic 
invoice submission is required.
    (c) Data transmission. A contractor must ensure that the data 
transmission method and format are through one of the following:
    (1) VA's Electronic Invoice Presentment and Payment System. (See 
Web site at http://www.fsc.va.gov/einvoice.asp.)
    (2) Any system that conforms to the X12 electronic data 
interchange (EDI) formats established by the Accredited Standards 
Center (ASC) and chartered by the American National Standards 
Institute (ANSI). The X12 EDI Web site (http://www.x12.org) includes 
additional information on EDI 810 and 811 formats.
    (d) Invoice requirements. Invoices shall comply with FAR 32.905.
    (e) Exceptions. If, based on one of the circumstances below, the 
contracting officer directs that payment requests be made by mail, 
the contractor shall submit payment requests by mail through the 
United States Postal Service to the designated agency office. 
Submission of payment requests by mail may be required for:
    (1) Awards made to foreign vendors for work performed outside 
the United States;
    (2) Classified contracts or purchases when electronic submission 
and processing of payment requests could compromise the safeguarding 
of classified or privacy information;
    (3) Contracts awarded by contracting officers in the conduct of 
emergency operations, such as responses to national emergencies;
    (4) Solicitations or contracts in which the designated agency 
office is a VA entity other than the VA Financial Services Center in 
Austin, Texas; or
    (5) Solicitations or contracts in which the VA designated agency 
office does not have electronic invoicing capability as described 
above.

    (End of clause)
[FR Doc. 2012-28612 Filed 11-26-12; 8:45 am]
BILLING CODE 8320-01-P