[Federal Register Volume 80, Number 224 (Friday, November 20, 2015)]
[Proposed Rules]
[Pages 72669-72671]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-29555]


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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Part 215

[Docket DARS-2015-0051]
RIN 0750-AI75


Defense Federal Acquisition Regulation Supplement: Promoting 
Voluntary Post-Award Disclosure of Defective Pricing (DFARS Case 2015-
D030)

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 (DFARS) to stipulate that DoD contracting 
officers shall request a limited-scope audit, unless a full-scope audit 
is appropriate for the circumstances, in the interest of promoting 
voluntary contractor disclosure of defective pricing identified by the 
contractor after contract award.

[[Page 72670]]


DATES: Comments on the proposed rule should be submitted in writing to 
the address shown below on or before January 19, 2016, to be considered 
in the formation of a final rule.

ADDRESSES: Submit comments identified by DFARS Case 2015-D030, using 
any of the following methods:
    [cir] Regulations.gov: http://www.regulations.gov. Submit comments 
via the Federal eRulemaking portal by entering ``DFARS Case 2015-D030'' 
under the heading ``Enter keyword or ID'' and selecting ``Search.'' 
Select the link ``Submit a Comment'' that corresponds with ``DFARS Case 
2015-D030.'' Follow the instructions provided at the ``Submit a 
Comment'' screen. Please include your name, company name (if any), and 
``DFARS Case 2015-D030'' on your attached document.
    [cir] Email: [email protected]. Include DFARS Case 2015-D030 in 
the subject line of the message.
    [cir] Fax: 571-372-6094.
    [cir] Mail: Defense Acquisition Regulations System, Attn: Mr. Mark 
Gomersall, OUSD(AT&L)DPAP/DARS, Room 3B941, 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. Mark Gomersall, telephone 571-372-
6176.

SUPPLEMENTARY INFORMATION: 

I. Background

    DoD is proposing to revise the DFARS to stipulate that DoD 
contracting officers shall request a limited-scope audit when a 
contractor voluntarily discloses defective pricing after contract 
award, unless a full-scope audit is appropriate for the circumstances. 
In response to the Better Buying Power 2.0 initiative on ``Eliminating 
Requirements Imposed on Industry where Costs Outweigh Benefits,'' 
contractors recommended several changes to 41 U.S.C. chapter 35, 
Truthful Cost or Pricing Data (formerly the Truth in Negotiations Act) 
and to the related DFARS guidance. Specifically, contractors 
recommended that DoD clarify policy guidance to reduce repeated 
submissions of certified cost or pricing data. Frequent submissions of 
such data are used as a defense against defective pricing claims by DoD 
after contract award, since data that are frequently updated are less 
likely to be considered outdated or inaccurate and, therefore, 
defective. Better Buying Power 3.0 called for a revision of regulatory 
guidance regarding the requirement for contracting officers to request 
an audit even if a contractor voluntarily discloses defective pricing 
after contract award.

II. Discussion and Analysis

    This proposed rule amends DFARS 215.407-1(c) to--
     Require DoD contracting officers to request a limited-
scope unless a full-scope audit is appropriate for the circumstances, 
when contractors voluntarily disclose defective pricing after contract 
award;
     Indicate that to determine the appropriate scope of the 
audit, the contracting officer should consult with Defense Contract 
Audit Agency; and
     Clarify that voluntary disclosure of defective pricing 
does not waive Government entitlement to the recovery of any 
overpayment plus interest on the overpayments, or rights to pursue 
defective pricing claims.

III. 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.

IV. 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. 
However, an initial regulatory flexibility analysis has been performed 
and is summarized as follows:
    The objective of the proposed rule is to stipulate that DoD 
contracting officers shall request a limited-scope audit when a 
contractor voluntarily discloses defective pricing after contract 
award, unless a full-scope audit is appropriate for the circumstances. 
This rule will apply to all DoD contractors, including small entities, 
who are required to submit certified cost or pricing data. If those 
small entities usually submit cost or pricing data frequently in order 
to avoid defective pricing claims, then this rule may encourage them to 
reduce the number of such submissions.
    There is no change to reporting or recordkeeping as a result of 
this rule. The rule does not duplicate, overlap, or conflict with any 
other Federal rules.
    There are no known significant alternative approaches to the rule 
that would meet the requirements.
    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 2015-D030), in 
correspondence.

V. Paperwork Reduction Act

    The 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).

List of Subjects in 48 CFR Part 215

    Government procurement.

Jennifer L. Hawes,
Editor, Defense Acquisition Regulations System.

    Therefore, 48 CFR part 215 is proposed to be amended as follows:

PART 215--CONTRACTING BY NEGOTIATION

0
1. The authority citation for part 215 continues to read as follows:

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

0
2. Add sections 215.407 and 215.407-1 to subpart 215.4 to read as 
follows:


215.407  Special cost or pricing areas.


215.407-1  Defective certified cost or pricing data.

    (c)(i) When contractors voluntarily disclose defective pricing 
after contract award, contracting officers shall request a limited-
scope audit (e.g., limited to the affected cost elements of the 
defective pricing disclosure) unless a full-scope audit is appropriate 
for the circumstances (e.g., nature or dollar amount of the defective 
pricing disclosure). To determine the appropriate scope of the audit, 
the contracting officer should consult with

[[Page 72671]]

Defense Contract Audit Agency (DCAA). At a minimum, the contracting 
officer shall request that DCAA evaluate--
    (A) Completeness of the contractor's voluntary disclosure on the 
affected contract;
    (B) Accuracy of the contractor's cost impact calculation for the 
affected contract; and
    (C) Potential impact on existing contracts, task or deliver orders, 
or other proposals the contractor has submitted to the Government.
    (ii) Voluntary disclosure of defective pricing is not a voluntary 
refund as defined in 242.7100 and does not waive the Government 
entitlement to the recovery of any overpayment plus interest on the 
overpayments in accordance with FAR 15.407-1(b)(7).
    (iii) Voluntary disclosure of defective pricing does not waive the 
Government's rights to pursue defective pricing claims on the affected 
contract or any other Government contract.

[FR Doc. 2015-29555 Filed 11-19-15; 8:45 am]
BILLING CODE 5001-06-P