[Federal Register Volume 89, Number 59 (Tuesday, March 26, 2024)]
[Proposed Rules]
[Pages 20924-20927]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-06004]


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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 204, 212, 247, and 252

[Docket DARS-2024-0007]
RIN 0750-AL12


Defense Federal Acquisition Regulation Supplement: Modification 
of Notification of Intent To Transport Supplies by Sea (DFARS Case 
2020-D026)

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 remove a DFARS solicitation provision 
and modify the text of an existing DFARS contract clause to include the 
operative text of that DFARS provision.

DATES: Comments on the proposed rule should be submitted in writing to 
the address shown below on or before May 28, 2024, to be considered in 
the formation of a final rule.

ADDRESSES: Submit comments identified by DFARS Case 2020-D026, using 
either of the following methods:
    [cir] Federal eRulemaking Portal: https://www.regulations.gov. 
Search for DFARS Case 2020-D026. Select ``Comment'' and follow the 
instructions to submit a comment. Please include ``DFARS Case 2020-
D026'' on any attached document.
    [cir] Email: [email protected]. Include DFARS Case 2020-D026 in 
the subject line of the message.
    Comments received generally will be posted without change to 
https://www.regulations.gov, including any personal information 
provided. To confirm receipt of your comment(s), please check https://www.regulations.gov, approximately two to three days after submission 
to verify posting.

FOR FURTHER INFORMATION CONTACT: David Johnson, telephone 202-913-5764.

SUPPLEMENTARY INFORMATION: 

I. Background

    DoD is proposing to revise the DFARS to remove the solicitation 
provision at DFARS 252.247-7022, Representation of Extent of 
Transportation By Sea, and to revise the contract clause at DFARS 
252.247-7023, Transportation of Supplies by Sea, accordingly, to effect 
the purpose of the provision using only the clause. This change will 
streamline instructions to contractors regarding required notifications 
to the Government of transportation of supplies by sea.

II. Discussion and Analysis

    Currently, DFARS provision 252.247-7022 and DFARS clause 252.247-
7023 are included in all solicitations with an anticipated value 
greater than the simplified acquisition threshold, except solicitations 
for direct purchase of ocean transportation services. The provision 
requires the offeror to represent whether supplies will or will not be 
transported by sea in performance of the contract or any subcontract. 
The clause notifies offerors of their responsibilities when 
transporting supplies by sea, which include the use of U.S. flag 
vessels, unless certain situations apply; the submission of a 
certification with a final invoice; and submission of bills of lading 
to the contracting officer and to the U.S. Department of Transportation 
Maritime Administration (MARAD).
    The provision's notification requirement was intended to aid 
acquisition personnel in carrying out their responsibilities under the 
clause. By effecting the notification via a solicitation provision, a 
representation is required from all offerors rather than just the 
awardee. Given the offeror's representation has no bearing on its 
eligibility or selection for award, the notification is better suited 
to be a requirement in the clause, where only the awardee must notify 
the contracting officer, as well as MARAD, only if transportation of 
supplies by sea will occur. Including MARAD on the notification 
provides all impacted parties with situational awareness and an ability 
to be proactive in ensuring compliance with the clause requirements.
    Given that DFARS clause 252.247-7023 is included in nearly all 
contracts, and DFARS provision 252.247-7022 is associated with the 
requirements of 252.247-7023, the text of the clause and provision can 
be combined. The result reduces the number of provisions required to be 
used in solicitations and the number of representations offerors must 
provide, while still maintaining the effect of DFARS provision 252.247-
7022.
    Consequent to removing DFARS clause 252.247-7022, this rule removes 
the clause prescription at DFARS 247.574(a) as well as direction at 
DFARS 204.1202 and 212.301 relating to the provision.

III. Applicability to Contracts at or Below the Simplified Acquisition 
Threshold (SAT), for Commercial Products (Including Commercially 
Available Off-the-Shelf (COTS) Items), and for Commercial Services

    This rule removes the provision at DFARS 252.247-7022, along with 
its prescription at DFARS 247.574(a), and amends the clause at DFARS 
252.247-7032 accordingly to include the substance of the provision. 
However, this proposed rule does not impose any new requirements on 
contracts at or below the SAT, for commercial products including COTS 
items, or for commercial services. The clause will continue to apply to 
acquisitions at or below the SAT, to acquisitions of commercial 
products including COTS items, and to acquisitions of commercial 
services.

IV. Expected Impact of the Rule

    This change is expected to streamline instructions to contractors 
regarding notifications of transportation of supplies by sea. 
Presently, DFARS

[[Page 20925]]

provision 252.247-7022 is included in nearly all solicitations and 
DFARS clause 252.247-7023 is included in nearly all contracts. By 
effectively combining the provision and the clause, this proposed rule 
will reduce the number of provisions required to be used in 
solicitations and the number of representations offerors must provide, 
while still maintaining the effect of DFARS provision 252.247-7022. 
Therefore, this proposed rule is expected to reduce administrative 
burden on contractors, including small businesses.

V. 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, as amended.

VI. Regulatory Flexibility Act

    DoD does not expect this proposed rule, when finalized, 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 rule does not create any new requirements or add to 
any existing requirements for contractors. However, an initial 
regulatory flexibility analysis has been performed and is summarized as 
follows:
    DoD is proposing to amend the Defense Federal Acquisition 
Regulation Supplement (DFARS) to remove a solicitation provision and 
accordingly to modify the text of an existing DFARS contract clause to 
include the operative text of that DFARS provision.
    The objective of this proposed rule is to streamline the 
instructions to contractors pertaining to the transportation of 
supplies by sea. The legal basis for the proposed rule is 41 U.S.C. 
1303.
    This proposed rule will likely affect small entities that will be 
awarded contract actions that include DFARS clause 252.247-7023, 
Transportation of Supplies by Sea. Data was obtained from the 
Procurement Business Intelligence Service for all contracts and 
modifications that include DFARS clause 252.247-7023 for fiscal years 
2020 through 2022. DoD awarded on average 642,310 contract actions per 
year that included DFARS clause 252.247-7023 to 30,680 unique entities, 
of which approximately 359,315 contract awards (56 percent) were made 
to 21,070 unique small entities (69 percent).
    The proposed rule does not impose any new reporting, recordkeeping, 
or compliance requirements.
    The proposed rule does not duplicate, overlap, or conflict with any 
other Federal rules.
    There are no known significant alternatives that would accomplish 
the objectives of the proposed rule.
    DoD invites comments from small business concerns and other 
interested parties on the expected impact of this proposed 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 2020-D026), in 
correspondence.

VII. Paperwork Reduction Act

    The Paperwork Reduction Act (44 U.S.C. chapter 35) applies to this 
proposed rule. However, these changes to the DFARS do not impose 
additional information collection requirements to the paperwork burden 
previously approved by the Office of Management and Budget (OMB) under 
OMB Control Number 0704-0245, entitled Defense Federal Acquisition 
Regulation Supplement (DFARS) Part 247, Transportation and Related 
Clauses.

List of Subjects in 48 CFR Parts 204, 212, 247, and 252

    Government procurement.

Jennifer D. Johnson,
Editor/Publisher, Defense Acquisition Regulations System.

    Therefore, 48 CFR parts 204, 212, 247, and 252 are proposed to be 
amended as follows:

0
1. The authority citation for parts 204, 212, 247, and 252 continue to 
read as follows:

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

PART 204--ADMINISTRATIVE AND INFORMATION MATTERS


204.1202  [Amended]

0
2. Amend section 204.1202 by removing paragraph (2)(xv).

PART 212--ACQUISITION OF COMMERCIAL PRODUCTS AND COMMERCIAL 
SERVICES

0
3. Amend section 212.301 by revising paragraph (f)(xxi) to read as 
follows:


212.301  Solicitation provisions and contract clauses for the 
acquisition of commercial products and commercial services.

* * * * *
    (f) * * *
    (xxi) Part 247--Transportation.
    (A) Use the clause at 252.247-7003, Pass-Through of Motor Carrier 
Fuel Surcharge Adjustment to the Cost Bearer, as prescribed in 247.207, 
to comply with section 884 of Public Law 110-417.
    (B) Use the basic or one of the alternates of the clause at 
252.247-7023, Transportation of Supplies by Sea, as prescribed in 
247.574(a), to comply with the Cargo Preference Act of 1904 (10 U.S.C. 
2631(a)).
    (1) Use the basic clause as prescribed in 247.574(a)(1).
    (2) Use the alternate I clause as prescribed in 247.574(a)(2).
    (3) Use the alternate II clause as prescribed in 247.574(a)(3).
    (C) Use the clause 252.247-7025, Reflagging or Repair Work, as 
prescribed in 247.574(b), to comply with 10 U.S.C. 2631(b).
    (D) Use the provision at 252.247-7026, Evaluation Preference for 
Use of Domestic Shipyards--Applicable to Acquisition of Carriage by 
Vessel for DoD Cargo in the Coastwise or Noncontiguous Trade, as 
prescribed in 247.574(c), to comply with section 1017 of Public Law 
109-364.
    (E) Use the clause at 252.247-7027, Riding Gang Member 
Requirements, as prescribed in 247.574(d), to comply with section 3504 
of the National Defense Authorization Act for Fiscal Year 2009 (Pub. L. 
110-417).
    (F) Use the clause at 252.247-7028, Application for U.S. Government 
Shipping Documentation/Instructions, as prescribed in 247.207.

PART 247--TRANSPORTATION


247.574  [Amended]

0
4. Amend section 247.574--
0
a. By removing paragraph (a);
0
b. By redesignating paragraphs (b) through (e) as paragraphs (a) 
through (d);
0
c. In newly redesignated paragraph (a) introductory text, by removing 
``all''; and
0
d. In newly redesignated paragraph (d), by removing ``under chapter 121 
of title 46 U.S.C.'' and adding ``46 U.S.C. chapter 121.'' in its 
place.

[[Page 20926]]

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES


252.204-7007  [Amended]

0
5. Amend section 252.204-7007 by--
0
a. Removing the provision date of ``NOV 2023'' and adding ``DATE'' in 
its place; and
0
b. Removing paragraph (d)(1)(viii).


252.247-7022  [Removed and Reserved]

0
6. Remove and reserve section 252.247-7022.
0
7. Amend section 252.247-7023--
0
a. By revising the introductory text and the clause date;
0
b. By redesignating paragraphs (b) through (i) as paragraphs (c) 
through (j);
0
c. By adding a new paragraph (b);
0
d. In the newly redesignated paragraph (e)(2) by removing ``Required 
shipping date'' and adding ``Required shipping date(s) and required 
delivery date(s)'' in its place;
0
e. By revising the newly redesignated paragraph (f) introductory text;
0
f. By revising the newly redesignated paragraph (i);
0
g. In the newly redesignated paragraph (j) introductory text by 
removing ``(b)(2)'' and adding ``(c)(2)'' in its place;
0
h. In the newly redesignated paragraph (j)(1) by removing ``paragraph 
(i)'' and adding ``paragraph (j)'' in its place; and
0
i. In the newly redesignated paragraph (j)(2) by removing ``paragraphs 
(a) through (e)'' and ``paragraph (i)'' and adding ``paragraphs (a) 
through (f)'' and ``paragraph (j)'' in their places, respectively.
0
j. In Alternate I--
0
i. By revising the introductory text and the clause date;
0
ii. By redesignating paragraphs (b) through (i) as paragraphs (c) 
through (j);
0
iii. By adding a new paragraph (b);
0
iv. In the newly redesignated paragraph (e)(2) by removing ``Required 
shipping date'' and adding ``Required shipping date(s) and required 
delivery date(s)'' in its place;
0
v. By revising the newly redesignated paragraph (f) introductory text;
0
vi. By revising the newly redesignated paragraph (i);
0
vii. In the newly redesignated paragraph (j) introductory text by 
removing ``(b)(2)'' and adding ``(c)(2)'' in its place;
0
viii. In the newly redesignated paragraph (j)(1) by removing 
``paragraph (i)'' and adding ``paragraph (j)'' in its place;
0
ix. In the newly redesignated paragraph (j)(2) by removing ``paragraphs 
(a) through (e)'' and ``paragraph (i)'' and adding ``paragraphs (a) 
through (f)'' and ``paragraph (j) in their places, respectively; and
0
x. By adding ``(End of clause)'' after newly redesignated paragraph 
(j)(2).
0
k. In Alternate II--
0
i. By revising the introductory text and the clause date;
0
ii. By redesignating paragraphs (b) through (i) as paragraphs (c) 
through (j);
0
iii. By adding a new paragraph (b);
0
iv. In the newly redesignated paragraph (e)(2) by removing ``Required 
shipping date'' and adding ``Required shipping date(s) and required 
delivery date(s)'' in its place;
0
v. By revising the newly redesignated paragraph (f) introductory text;
0
vi. By revising the newly redesignated paragraph (i);
0
vii. In the newly redesignated paragraph (j) introductory text by 
removing ``(b)(2)'' and adding ``(c)(2)'' in its place;
0
viii. In the newly redesignated paragraph (j)(1) by removing 
``paragraph (i)'' and adding ``paragraph (j)'' in its place;
0
ix. In the newly redesignated paragraph (j)(2) by removing ``paragraphs 
(a) through (e)'' and ``paragraph (i)'' and adding ``paragraphs (a) 
through (f)'' and ``paragraph (j)'' in their places, respectively; and
0
x. By adding ``(End of clause)'' after newly redesignated paragraph 
(j)(2).
    The revisions and additions read as follows:


252.247-7023  Transportation of Supplies by Sea.

    Basic. As prescribed in 247.574(a) and (a)(1), use the following 
clause:

Transportation of Supplies by Sea--Basic (Date)

* * * * *
    (b) If the transportation of supplies by sea is anticipated under 
this contract, the Contractor shall--
    (1) Notify the Contracting Officer and Maritime Administration 
(MARAD) at [email protected]--
    (i) Within 3 business days after contract award; or
    (ii) Immediately prior to the shipment departure date necessary to 
meet delivery schedules, whichever is earlier; and
    (2) Include in the notification--
    (i) A statement of the Contractor's intent to transport supplies by 
sea;
    (ii) The contract number; and
    (iii) The task-order or delivery-order number, when applicable.
* * * * *
    (f) The Contractor shall, within 30 days after each shipment 
covered by this clause, provide the Contracting Officer and MARAD at 
[email protected], Attention: Military Team, one copy of the rated on 
board vessel operating carrier's ocean bill of lading, which shall 
contain the following information:
* * * * *
    (i) If the Contractor did not anticipate transporting any supplies 
by sea at the time of contract award and, therefore, did not provide 
the notification required by paragraph (b) of this clause, but prior to 
shipment of supplies, the Contractor learns that supplies will be 
transported by sea, the Contractor shall--
    (1) Provide the notification required by paragraph (b) of this 
clause to the Contracting Officer and MARAD as soon as it is known that 
supplies will be transported by sea; and
    (2) Comply with all the terms and conditions of this clause.
* * * * *
    Alternate I. As prescribed in 247.574(a) and (a)(2), use the 
following clause, which uses a different paragraph (c) than the basic 
clause:

Transportation of Supplies by Sea--Alternate I (Date)

* * * * *
    (b) If the transportation of supplies by sea is anticipated under 
this contract, the Contractor shall--
    (1) Notify the Contracting Officer and Maritime Administration 
(MARAD) at [email protected]--
    (i) Within 3 business days after contract award; or
    (ii) Immediately prior to the shipment departure date necessary to 
meet delivery schedules, whichever is earlier; and
    (2) Include in the notification--
    (i) A statement of the Contractor's intent to transport supplies by 
sea;
    (ii) The contract number; and
    (iii) The task-order or delivery-order number, when applicable.
* * * * *
    (f) The Contractor shall, within 30 days after each shipment 
covered by this clause, provide the Contracting Officer and MARAD at 
[email protected], Attention: Military Team, one copy of the rated on 
board vessel operating carrier's ocean bill of lading, which shall 
contain the following information:
* * * * *
    (i) If the Contractor did not anticipate transporting any supplies 
by sea at the time of contract award and, therefore, did not provide 
the notification required by paragraph (b) of this clause, but prior to 
shipment of the supplies, the Contractor learns that supplies will be 
transported by sea, the Contractor shall--

[[Page 20927]]

    (1) Provide the notification required by paragraph (b) of this 
clause to the Contracting Officer and MARAD as soon as it is known that 
supplies will be transported by sea; and
    (2) Comply with all the terms and conditions of this clause.
* * * * *
    Alternate II. As prescribed in 247.574(a) and (a)(3), use the 
following clause, which uses a different paragraph (c) than the basic 
clause:

Transportation of Supplies by Sea--Alternate II (date)

* * * * *
    (b) If the transportation of supplies by sea is anticipated under 
this contract, the Contractor shall--
    (1) Notify the Contracting Officer and Maritime Administration 
(MARAD) at [email protected]--
    (i) Within 3 business days after contract award; or
    (ii) Immediately prior to the shipment departure date necessary to 
meet delivery schedules, whichever is earlier; and
    (2) Include in the notification--
    (i) A statement of the Contractor's intent to transport supplies by 
sea;
    (ii) The contract number; and
    (iii) The task-order or delivery-order number, when applicable.
* * * * *
    (f) The Contractor shall, within 30 days after each shipment 
covered by this clause, provide the Contracting Officer and MARAD at 
[email protected], Attention: Military Team, one copy of the rated on 
board vessel operating carrier's ocean bill of lading, which shall 
contain the following information:
* * * * *
    (i) If the Contractor did not anticipate transporting any supplies 
by sea at the time of contract award, and, therefore, did not provide 
the notification required by paragraph (b) of this clause, but prior to 
shipment of the supplies, the Contractor learns after the award of the 
contract that supplies will be transported by sea, the Contractor 
shall--
    (1) Provide the notification required by paragraph (b) of this 
clause to the Contracting Officer and MARAD as soon as it is known that 
supplies will be transported by sea; and
    (2) Comply with all the terms and conditions of this clause.
* * * * *
0
8. Amend section 252.247-7025--
0
a. By revising the section heading; and
0
b. In the introductory text by removing ``247.574(c)'' and adding 
``247.574(b)'' in its place.
    The revision reads as follows:


252.247-7025  Reflagging or Repair Work.

* * * * *


252.247-7026  [Amended]

0
9. Amend section 252.247-7026 introductory text by removing 
``247.574(d)'' and adding ``247.574(c)'' in its place.
0
10. Amend section 252.247-7027--
0
a. By revising the section heading; and
0
b. In the introductory text by removing ``247.574(e)'' and adding 
``247.574(d)'' in its place.
    The revision reads as follows:


252.247-7027  Riding Gang Member Requirements.

* * * * *
[FR Doc. 2024-06004 Filed 3-25-24; 8:45 am]
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