[Federal Register Volume 81, Number 149 (Wednesday, August 3, 2016)]
[Rules and Regulations]
[Pages 51125-51126]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-18280]

[[Page 51125]]



48 CFR Parts 609 and 649

[Public Notice: 9599]
RIN 1400-AD90

Department of State Acquisition Regulation

AGENCY: Department of State.

ACTION: Final rule.


SUMMARY: This rule adopts as final certain changes proposed to the 
Department of State Acquisition Regulation (DOSAR) to provide 
procedural changes relating to the suspension and debarment process.

DATES: This rule is effective September 2, 2016.

FOR FURTHER INFORMATION CONTACT: Ms. Colleen Kosar, Policy Division, 
Office of the Procurement Executive, A/OPE, 2201 C Street NW., Suite 
1060, State Annex Number 15, Washington, DC 20520. Telephone: 703-516-
1685. Email: [email protected].

SUPPLEMENTARY INFORMATION: The Department of State published a Notice 
of Proposed Rulemaking (NPRM), Public Notice 9479 at 81 FR 17121, March 
28, 2016, with a request for comments. A summary of the proposed 
changes and the reasons therefor were included in the NPRM. The comment 
period closed May 27, 2016. The Department did not receive any 
substantive comments on the rule. One correspondent raised matters that 
were not relevant to this rulemaking. The Department is now adopting 
the proposed rule as a final rule without change.

Regulatory Findings

Administrative Procedure Act

    In accordance with the provisions of the Administrative Procedure 
Act (APA) governing rules promulgated by federal agencies that affect 
the public (5 U.S.C. 552 and 553), the Department published this 
rulemaking as a proposed rule and invited public comment. In accordance 
with the APA, this rulemaking will be effective 30 days after 

Regulatory Flexibility Act

    The Department of State, in accordance with the Regulatory 
Flexibility Act (5 U.S.C. 605(b)), has reviewed this regulation and, by 
approving it, certifies that this rule will not have a significant 
economic impact on a substantial number of small entities. This 
determination was based on the fact that the changes proposed in this 
update have no impact on small businesses. The number of small 
businesses considered for suspension or debarment will not grow or 
shrink as a result of the proposed changes. The Department analyzed the 
suspension/debarment actions that occurred in FY14 and no small 
businesses were impacted.

Unfunded Mandates Act of 1995

    This rule will not result in the expenditure by State, local, and 
tribal governments, in the aggregate, or by the private sector, of $100 
million or more in any year and it will not significantly or uniquely 
affect small governments. Therefore, no actions were deemed necessary 
under the provisions of the Unfunded Mandates Act of 1995.

Small Business Regulatory Enforcement Fairness Act of 1996

    This rule is not a major rule as defined by the Small Business 
Regulatory Enforcement Act of 1996 (5 U.S.C. 801 et seq.). This rule 
will not result in an annual effect on the economy of $100 million or 
more; a major increase in costs or prices; or significant adverse 
effects on competition, employment, investment, productivity, 
innovation, or on the ability of United States-based companies to 
compete with foreign-based companies in domestic and import markets. 
This determination was based on the fact that the proposed changes are 
intended to simplify the procedural aspects of the suspension and 
debarment process. The rule does not place new requirements on contract 
performance. The rule does not have a significant cost or 
administrative impact on offerors or contractors.

Executive Orders 12866 and 13563

    Executive Orders (E.O.) 12866 and 13563 direct agencies to assess 
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 
emphasized the importance of quantifying both costs and benefits, of 
reducing costs, of harmonizing rules, and of promoting flexibility. The 
Department of State does not consider this rule to be an ``economically 
significant regulatory action'' under Executive Order 12866. The 
Department has reviewed the regulation to ensure its consistency with 
the regulatory philosophy and principles set forth in the Executive 
Orders and finds that the benefits of updating this rule outweigh any 
costs, which the Department assesses to be minimal.

Executive Order 13132

    This rule will not have substantial direct effects on the States, 
on the relationship between the national government and the States, or 
on the distribution of power and responsibilities among the various 
levels of government. Therefore, in accordance with section 6 of 
Executive Order 13132, it is determined that this rule does not have 
sufficient federalism implications to require consultations or warrant 
the preparation of a federalism summary impact statement.

Executive Order 13175

    The Department has determined that this rulemaking will not have 
tribal implications, will not impose substantial direct compliance 
costs on Indian tribal governments, and will not pre-empt tribal law. 
Accordingly, the requirements of Executive Order 13175 do not apply to 
this rulemaking.

Paperwork Reduction Act

    The rule imposes no new or revised information collections under 
the Paperwork Reduction Act of 1980 (44 U.S.C. Chapter 35).

List of Subjects in 48 CFR Parts 609 and 649

    Administrative practice and procedure, Government procurement.

    For the reasons stated in the preamble, the Department of State 
amends 48 CFR chapter 6 as follows:

1. The authority citation for 48 CFR parts 609 and 649 continues to 
read as follows:

    Authority:  22 U.S.C. 2651a, 40 U.S.C. 121(c) and 48 CFR chapter 


2. Revise section 609.403-70 to read as follows:

609.403-70  DOSAR definitions.

    Fact-finding official means the individual designated by the 
debarring official to conduct additional proceedings as necessary 
concerning disputed material facts.

609.405-1  [Amended]

3. In section 609.405-1, remove ``609.405-70'' and add in its place 

609.405-70  [Redesignated as 649.101-70 and Transferred]

4. Redesignate section 609.405-70 as 649.101-70 and transfer newly 
redesiganted section 649.101-70 to part 649.

[[Page 51126]]

5. In section 609.406-3, revise paragraphs (a), (b)(2) through (7), 
(c)(2), and (d) to read as follows:

609.406-3  Procedures.

    (a) Investigation and referral. (1) DOS employees aware of any 
cause that might serve as the basis for debarment shall refer those 
cases through the contracting officer to the debarring official. The 
debarring official shall refer to the Office of the Inspector General 
all reported cases that involve possible criminal or fraudulent 
activities for investigation by that office.
    (2) Referrals for consideration of debarment shall include, as 
appropriate and available--
    (i) The cause for debarment (see FAR 9.406-2);
    (ii) A statement of facts;
    (iii) Copies of supporting documentary evidence and a list of all 
necessary or probable witnesses, including addresses and telephone 
numbers, together with a statement concerning their availability to 
appear at a fact-finding proceeding and the subject matter of their 
    (iv) A list of all contractors involved, either as principals or as 
affiliates, including current or last known home and business addresses 
and ZIP codes;
    (v) A statement of the acquisition history with such contractors;
    (vi) A statement concerning any known pertinent active or potential 
criminal investigation, criminal or civil court proceedings, or 
administrative claim before Boards of Contract Appeals; and
    (vii) A statement from each DOS organizational element affected by 
the debarment action as to the impact of a debarment on DOS programs.
    (3) As deemed appropriate, the debarring official may conduct 
investigations to supplement the information provided in the referral, 
or may request investigations by the Office of the Inspector General or 
other Department office.
    (b) * * *
    (2) In response to the debarment notice, if the contractor or its 
representative notifies the debarring official within 30 days after 
receipt of the notice that it wants to present information and 
arguments in person to the debarring official, that official, or a 
designee, shall chair such a meeting. The oral presentation shall be 
conducted informally and a transcript need not be made. However, the 
contractor may supplement its oral presentation with written 
information and arguments for inclusion in the administrative record.
    (3) Pursuant to FAR 9.406-3(b)(2), the contractor may request a 
fact-finding proceeding.
    (4) The debarring official shall designate a fact-finding official 
and shall provide the fact-finding official with a copy of all 
documentary evidence considered in proposing debarment. Upon receipt of 
such material, the fact-finding official shall notify the contractor 
and schedule a hearing date.
    (5) In addition to the purposes provided in FAR 9.406-3(b)(2), the 
hearing is intended to provide the debarring official with findings of 
fact based on a preponderance of evidence submitted to the fact-finding 
official and to provide the debarring official with a determination as 
to whether a cause for debarment exists, based on the facts as found.
    (6) The fact-finding proceeding shall be conducted in accordance 
with procedures determined by the fact-finding official. The rules 
shall be as informal as is practicable, consistent with FAR 9.406-3(b). 
The fact-finding official is responsible for making the transcribed 
record of the hearing, unless the contractor and the fact-finding 
official agree to waive the requirement for a transcript.
    (7) The fact-finding official shall deliver written findings and 
the transcribed record, if made, to the debarring official. The 
findings shall resolve any facts in dispute based on a preponderance of 
the evidence presented and recommend whether a cause for debarment 
    (c) * * *
    (2) When a determination is made to initiate action, the debarring 
official shall provide to the contractor and any specifically named 
affiliates written notice in accordance with FAR 9.406-3(c).
* * * * *
    (d) Debarring official's decision. In addition to complying with 
FAR 9.406-3(d) and (e), the debarring official shall provide single 
copies of the decision to each DOS organizational element affected by 
the decision.

609.407-3  [Amended]

6. In section 609.407-3:
a. In paragraph (b)(2), remove the word ``panel'' and add in its place 
b. In paragraph (d), remove ``and to the General Services 
Administration in accordance with 609.404''.


7. Add section 649.101 to read as follows:

649.101  Authorities and responsibilities.

649.101-70  [Amended]

8. Revise the heading of newly redesignated section 649.101-70 to read 
as follows:

649.101-70  Termination action decisions after debarment.

* * * * *

    Dated: July 22, 2016.
Eric N. Moore,
Acting, Procurement Executive, Department of State.
[FR Doc. 2016-18280 Filed 8-2-16; 8:45 am]