[Federal Register Volume 81, Number 229 (Tuesday, November 29, 2016)]
[Proposed Rules]
[Pages 85914-85915]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-28450]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Part 1

[FAR Case 2016-005; Docket No. 2016-0005, Sequence No.1]


RIN 9000-AN29

Federal Acquisition Regulation: Effective Communication between 
Government and Industry

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

ACTION: Proposed rule.

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

SUMMARY: DoD, GSA, and NASA are proposing to amend the Federal 
Acquisition Regulation (FAR) to implement a section of the National 
Defense Authorization Act (NDAA) for Fiscal Year (FY) 2016. This rule 
clarifies that agency acquisition personnel are permitted and 
encouraged to engage in responsible and constructive exchanges with 
industry, so long as those exchanges are consistent with existing law 
and regulation and do not promote an unfair competitive advantage to 
particular firms.

DATES: Interested parties should submit comments to the Regulatory 
Secretariat Division at one of the addresses shown below on or before 
January 30, 2017 to be considered in the formulation of a final rule.

ADDRESSES: Submit comments in response to FAR case 2016-005 by any of 
the following methods:
     Regulations.gov: http://www.regulations.gov. Submit 
comments via the Federal eRulemaking portal by entering ``FAR Case 
2016-005'' under the heading ``Enter Keyword or ID'' and selecting 
``Search.'' Select the link ``Comment Now'' that corresponds with ``FAR 
Case 2016-005.'' Follow the instructions provided on the screen. Please 
include your name, company name (if any), and ``FAR Case 2016-005'' on 
your attached document.
     Mail: General Services Administration, Regulatory 
Secretariat Division, ATTN: Ms. Flowers, 1800 F Street NW., 2nd Floor, 
Washington, DC 20405.
    Instructions: Please submit comments only and cite ``FAR Case 2016-
005: Effective Communication between Government and Industry'' in all 
correspondence related to this case. Comments received generally will 
be posted without change to http://www.regulations.gov, including any 
personal and/or business confidential 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: For clarification of content, contact 
Mr. Michael O. Jackson, Procurement Analyst, at 202-208-4949. For 
information pertaining to status or publication schedules, contact the 
Regulatory Secretariat Division at 202-501-4755. Please cite ``FAR Case 
2016-005.''

SUPPLEMENTARY INFORMATION:

I. Background

    DoD, GSA, and NASA (the ``Councils'') are proposing to amend the 
FAR to implement section 887 of NDAA for FY 2016. The rule clarifies 
that agency acquisition personnel are permitted and encouraged to 
engage in responsible and constructive exchanges with industry, in a 
manner that is consistent with existing law and regulation, and does 
not promote an unfair competitive advantage.
    FAR 1.102 establishes the guiding principles within the FAR to--
    (1) Satisfy the customer in terms of cost, quality, and timeliness 
of the delivered product or service;
    (2) Minimize administrative operating costs;
    (3) Conduct business with integrity, fairness, and openness; and
    (4) Fulfill public policy objectives.
    FAR 1.102-2 provides the requirements or ``performance standards'' 
for transforming these principles into positive, results-oriented 
acquisition strategies. A communication policy that takes into account 
a range of approaches for effectively describing the Government's 
requirements to private industry is an essential component of the 
Federal acquisition process. This concept is in keeping with the 
direction expressed by Congress in section 887 of the NDAA for FY 2016.

II. Discussion and Analysis

    The proposed rule will amend FAR 1.102-2(a)(4) to specifically 
state that Government acquisition personnel are permitted and 
encouraged to engage in responsible and constructive exchanges with 
industry, so long as those exchanges are consistent with existing laws 
and regulations, and promote a fair competitive environment. This 
revision,

[[Page 85915]]

coupled with the existing guidance in the FAR subpart 1.1 and the 
market research strategies set forth in FAR part 10, will better equip 
Federal acquisition officials with the information needed to issue 
high-quality solicitations.

III. Public Feedback

    In the winter of 2011, the Office of Federal Procurement Policy 
(OFPP) launched a campaign to address misconceptions commonly held by 
industry and Government regarding the role of communication during the 
acquisition process in order to encourage early, frequent, and 
constructive engagement with industry to achieve better acquisition 
outcomes. The first of two ``myth-busting'' memoranda, issued in 
February 2011, focused on misconceptions on the part of Federal 
agencies and a second memorandum, issued in May 2012, addressed 
misconceptions that may be held by some in the vendor community. Both 
memoranda described best practices for effective communication that 
have been put into use by the acquisition community, with good results. 
Copies of these memoranda, ``Myth-Busting: Addressing Misconceptions to 
Improve Communication with Industry during the Acquisition Process'' 
and ``Myth-Busting 2: Addressing Misconceptions and Further Improving 
Communication During the Acquisition Process,'' are available at 
https://www.whitehouse.gov/omb/procurement_index_memo. The Councils 
seek to continue the conversation initiated by these memoranda and 
welcome any suggestions from the public to further enhance open 
communication between industry and the Federal acquisition community. 
The Councils specifically request information regarding the following:
     Which phase(s) of the Federal acquisition process--i.e., 
acquisition planning/market research; solicitation/award; post award--
would benefit from more exchanges with industry and what specific 
policies or procedures would enhance communication during these phases?
     Is there a current FAR policy that may inhibit 
communication? If so, what is the policy, and how could this policy be 
revised to remove barriers to effective communication?
     Might it be beneficial to encourage, or require, 
contracting officers to conduct discussions with offerors after 
establishing the competitive range for contracts of a high dollar 
threshold? If so, what would be the appropriate dollar threshold?

IV. Executive Order 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.

V. Regulatory Flexibility Act

    DoD, GSA, and NASA do not expect the 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., because the proposed changes relate to internal Government 
business practices. However, an Initial Regulatory Flexibility Analysis 
(IRFA) has been prepared and is summarized as follows:

    DoD, GSA, and NASA are proposing to amend the Federal 
Acquisition Regulation (FAR) to implement section 887 of the 
National Defense Authorization Act (NDAA) for FY 2016, which 
provides that agency acquisition personnel are permitted and 
encouraged to engage in responsible and constructive exchanges with 
industry. Any effect to small businesses should be positive in that 
industry, including small business, will benefit from better 
communication with the Government. Based on data obtained from the 
Federal Procurement Data System--Next Generation (FPDS-NG) on June 
21, 2016, approximately 112,150 businesses received Federal 
contracts during fiscal year 2015, and of these, approximately 
75,000 or 67 percent were small businesses.
    This rule does not impose any new reporting, recordkeeping or 
other compliance requirements. The rule does not duplicate, overlap, 
or conflict with any other Federal rules.

    The Regulatory Secretariat Division 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 Division. DoD, GSA and NASA invite comments from small 
business concerns and other interested parties on the expected impact 
of this proposed rule on small entities.
    DoD, GSA, and NASA will also consider comments from small entities 
concerning the existing regulations in subparts affected by this 
proposed rule consistent with 5 U.S.C. 610. Interested parties must 
submit such comments separately and should cite 5 U.S.C. 610 (FAR Case 
2016-005) in correspondence.

VI. 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 1

    Government procurement.

    Dated: November 21, 2016.
William F. Clark,
Director, Office of Governmentwide Acquisition Policy, Office of 
Acquisition Policy, Office of Governmentwide Policy.

    Therefore, DoD, GSA, and NASA are proposing to amend 48 CFR part 1 
as set forth below:

PART 1--FEDERAL ACQUISITION REGULATIONS SYSTEM

0
1. The authority citation for 48 CFR part 1 continues to read as 
follows:

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

0
2. Amend section 1.102-2 by--
0
a. Revising paragraph (a)(4);
0
b. Redesignating paragraphs (a)(5) through (7) as paragraphs (a)(6) 
through (8), respectively; and
0
c. Adding a new paragraph (a)(5).
    The revision and addition read as follows:


1.102-2  Performance standards.

    (a) * * *
    (4) The Government must not hesitate to communicate with the 
commercial sector as early as possible in the acquisition cycle to help 
the Government determine the capabilities available in the commercial 
marketplace. Government acquisition personnel are permitted and 
encouraged to engage in responsible and constructive exchanges with 
industry as part of market research (see 10.002), so long as those 
exchanges are consistent with existing laws, regulations, and promote a 
fair competitive environment.
    (5) The Government will maximize its use of commercial products and 
services in meeting Government requirements.
* * * * *
[FR Doc. 2016-28450 Filed 11-28-16; 8:45 am]
BILLING CODE 6820-EP-P