[Federal Register Volume 81, Number 204 (Friday, October 21, 2016)]
[Rules and Regulations]
[Pages 73005-73006]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-25317]



  Federal Register / Vol. 81, No. 204 / Friday, October 21, 2016 / 
Rules  

[[Page 73005]]


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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 203 and 252

[Docket DARS-2016-0016]
RIN 0750-AI94


Defense Federal Acquisition Regulation Supplement: Display of 
Hotline Posters (DFARS Case 2016-D018)

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

ACTION: Final rule.

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SUMMARY: This rule amends the Defense Federal Acquisition Regulation 
Supplement (DFARS) to consolidate the multiple hotline posters into one 
poster that delineates multiple reportable offenses.

DATES: Effective October 21, 2016.

FOR FURTHER INFORMATION CONTACT: Ms. Amy Williams, telephone 571-372-
6106.

SUPPLEMENTARY INFORMATION: 

I. Background

    DoD published a proposed rule in the Federal Register at 81 FR 
28816 on May 10, 2016, to revise DFARS clause 252.203-7004, Display of 
Hotline Posters, to reduce the number of fraud, waste, and abuse 
hotline posters required to be displayed and to remove the United 
States only restriction for use of the poster. One respondent submitted 
a public comment in response to the proposed rule.

II. Discussion and Analysis

    DoD reviewed the public comments in the development of the final 
rule. A discussion of the comments and the changes made to the rule as 
a result of the comment is provided, as follows:

A. Summary of Significant Changes From the Proposed Rule

    The following two changes from the proposed rule are based on 
internal Government comments:
     At DFARS 203.1003, paragraph (c) is added to permit 
alternative means of notifying contractor personnel of the DoD Hotline 
program in lieu of displaying the posters, when performance is outside 
the United States and security concerns can be appropriately 
demonstrated to the contracting officer. In the DFARS 252.203-7004 
clause, a similar statement is also added at paragraph (b)(1)(ii).
     The final rule also removes from the DFARS 252.203-7004 
clause the statement regarding assistance with translation. The 
contractor bears the individual and financial responsibility for 
translation and accuracy of translated hotline posters.

B. Analysis of Public Comment

    Comment: The respondent supports the proposed rule to display a 
consolidated poster, and recommends the DoD Office of the Inspector 
General consider publishing several poster variations that combine 
these three initiatives and that any one of these posters may be 
displayed at the option of the contractor. This will permit contractors 
to periodically rotate posters in order to refresh interest and 
attention by contractor employees, and also permit contractors to 
select posters that more closely match their respective corporate 
culture. In addition, the respondent recommended that at least some 
posters emphasize the benefits of a culture that does not tolerate 
fraud or human trafficking and encourages reporting, rather than just 
the negative, punitive aspects of compliance failure.
    Response: This comment is outside the scope of this rule and no 
change is made to the rule.

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

    A final regulatory flexibility analysis has been prepared 
consistent with the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., 
and is summarized as follows:
    The Defense Federal Acquisition Regulation Supplement (DFARS) 
clause 252.203-7004, Display of Hotline Posters, required three 
separate hotline posters which have now been combined into one poster. 
The objective of the rule is to reduce the number of fraud, waste, and 
abuse hotline posters required to be displayed and to remove the United 
States only restriction for use of the poster.
    There were no public comments in response to the initial regulatory 
flexibility analysis.
    DFARS clause 252.203-7004 is required for use in contracts with an 
estimated value greater than $5.5 million, except contracts awarded 
using Federal Acquisition Regulations part 12 commercial item 
procedures for the acquisition of commercial item. According to data 
available in the Federal Procurement Data System, in fiscal year (FY) 
2015, DoD awarded 4,180 contracts meeting this criteria to 2,656 unique 
vendors, of which 1,598 (approximately 60% percent) were small 
businesses. DoD estimates the total number of small businesses affected 
by this rule to be approximately 1,920 small businesses (the total for 
FY 2015 plus 20 percent to accommodate subcontractor applicability).
    There are no reporting or recordkeeping burdens associated with 
this rule.
    The rule has no significant economic impact on small entities. DoD 
did not identify any significant alternatives that would reduce the 
impact on small entities and still meet the objectives of the statute.

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 Parts 203 and 252

    Government procurement.

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

    Therefore, 48 CFR parts 203 and 252 are amended as follows:

0
1. The authority citation for parts 203 and 252 continues to read as 
follows:

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

PART 203--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF 
INTEREST

0
2. Amend section 203.1003 by adding paragraph (c) to read as follows:


203.1003   Requirements.

* * * * *
    (c) Fraud hotline poster. For contracts performed outside the 
United States, when security concerns can be

[[Page 73006]]

appropriately demonstrated, the contracting officer may provide the 
contractor the option to publicize the program to contractor personnel 
in a manner other than public display of the poster required by 
203.1004(b)(2)(ii), such as private employee written instructions and 
briefings.

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
3. Amend section 252.203-7004 by--
0
a. Removing the clause date ``(OCT 2015)'' and adding ``(OCT 2016)'' in 
its place;
0
b. Revising paragraph (b);
0
c. Removing paragraph (c);
0
d. Redesignating paragraphs (d) and (e) as paragraphs (c) and (d), 
respectively;
0
e. In newly redesignated paragraph (c)(1), removing ``These DoD hotline 
posters'' and adding ``The DoD hotline poster'' in its place and 
removing ``or are also'' and adding ``or is also'' in its place;
0
f. In newly redesignated paragraph (c)(2), removing ``posters are'' and 
adding ``poster is'' in its place and removing the last sentence;
0
g. In the newly redesignated paragraph (c)(3), removing ``these 
required posters'' and adding ``the required poster'' in its place; and
0
h. In newly designated paragraph (d), removing the phrase ``the 
substance of'' and removing ``paragraph (e)'' and adding ``paragraph 
(d)'' in its place.
    The revision reads as follows:


252.203-7004   Display of Hotline Posters.

* * * * *
    (b) Display of hotline poster(s). (1)(i) The Contractor shall 
display prominently the DoD fraud, waste, and abuse hotline poster 
prepared by the DoD Office of the Inspector General, in effect at time 
of contract award, in common work areas within business segments 
performing work under Department of Defense (DoD) contracts.
    (ii) For contracts performed outside the United States, when 
security concerns can be appropriately demonstrated, the contracting 
officer may provide the contractor the option to publicize the program 
to contractor personnel in a manner other than public display of the 
poster, such as private employee written instructions and briefings.
    (2) If the contract is funded, in whole or in part, by Department 
of Homeland Security (DHS) disaster relief funds and the work is to be 
performed in the United States, the DHS fraud hotline poster shall be 
displayed in addition to the DoD hotline poster. If a display of a DHS 
fraud hotline poster is required, the Contractor may obtain such poster 
from--
    (i) DHS Office of Inspector General/MAIL STOP 0305, Attn: Office of 
Investigations--Hotline, 245 Murray Lane SW., Washington, DC 20528-
0305; or
    (ii) Via the Internet at https://www.oig.dhs.gov/assets/Hotline/DHS_OIG_Hotline-optimized.jpg.
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[FR Doc. 2016-25317 Filed 10-20-16; 8:45 am]
 BILLING CODE 5001-06-P