[Federal Register Volume 89, Number 158 (Thursday, August 15, 2024)]
[Proposed Rules]
[Pages 66338-66341]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-18111]
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DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System
48 CFR Parts 209 and 252
[Docket DARS-2024-0025]
RIN 0750-AM20
Defense Federal Acquisition Regulation Supplement: Limitation on
Certain Institutes of Higher Education (DFARS Case 2024-D023)
AGENCY: Defense Acquisition Regulations System, Department of Defense
(DoD).
ACTION: Proposed rule.
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[[Page 66339]]
SUMMARY: DoD is proposing to amend the Defense Federal Acquisition
Regulation Supplement (DFARS) to implement sections of the National
Defense Authorization Act for Fiscal Year 2024, which amend a section
of the National Defense Authorization Act for Fiscal Year 2021 that
provides for the limitation of funds, authorized to be appropriated or
otherwise made available for any fiscal year for DoD, to be provided to
an institution of higher education that hosts a Confucius Institute.
DATES: Comments on the proposed rule should be submitted in writing to
the address shown below on or before October 15, 2024, to be considered
in the formation of a final rule.
ADDRESSES: Submit comments identified by DFARS Case 2024-D023, using
either of the following methods:
[cir] Federal eRulemaking Portal: https://www.regulations.gov.
Search for DFARS Case 2024-D023. Select ``Comment'' and follow the
instructions to submit a comment. Please include ``DFARS Case 2024-
D023'' on any attached documents.
[cir] Email: [email protected]. Include DFARS Case 2024-D023 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: Kimberly Bass, telephone 703-717-3446.
SUPPLEMENTARY INFORMATION:
I. Background
DoD is proposing to revise the DFARS to implement sections 1044 and
1045 of the National Defense Authorization Act (NDAA) for Fiscal Year
(FY) 2024 (Pub. L. 118-31), which amend section 1062 of the NDAA for FY
2021 (Pub. L. 116-283). DoD published an interim rule in the Federal
Register at 88 FR 67607 on September 29, 2023, under DFARS Case 2021-
D023 to implement section 1062 of the NDAA for FY 2021. Section 1062
provides that none of the funds authorized to be appropriated or
otherwise made available for any fiscal year for DoD may be provided to
an institution of higher education that hosts a Confucius Institute,
defined as a cultural institute directly or indirectly funded by the
government of the People's Republic of China. In addition, section 1062
provided the authority to waive the funds limitation. There were no
public comments submitted in response to the interim rule.
Section 1044 of the NDAA for FY 2024 amends section 1062(d) of the
NDAA for FY 2021 by revising the definition of ``Confucius Institute''
as any program that receives funding or support from the Chinese
International Education Foundation, the Center for Language Exchange
Cooperation of the Ministry of Education of the People's Republic of
China, or any cultural institute funded by the government of the
People's Republic of China.
Section 1045 of the NDAA for FY 2024 amends section 1062(b) of the
NDAA for FY 2021 to add a termination date of October 1, 2026, for the
authority to issue a waiver.
II. Discussion and Analysis
No respondents submitted public comments in response to the interim
rule published at 88 FR 67607 on September 29, 2023.
A. New Definition
This proposed rule under DFARS Case 2024-D023 includes revisions to
the definition of ``Confucius Institute'' at DFARS 209.170-1.
``Confucius Institute'' means any program that receives funding or
support from the Chinese International Education Foundation, the Center
for Language Exchange Cooperation of the Ministry of Education of the
People's Republic of China, or any cultural institute funded by the
government of the People's Republic of China.
B. Waiver of Funds Limitation
This proposed rule at DFARS 209.170-3 adds a termination date of
October 1, 2026, for the authority to issue a waiver. Currently, the
funds limitation with respect to an institution of higher education can
be waived by the Office of the Under Secretary of Defense for Research
and Engineering (OUSD(R&E)). DFARS 209.170-3 addresses the OUSD(R&E),
Confucius Institute Waiver Program procedures.
C. Solicitation Provision
The solicitation provision at DFARS 252.209-7011, Representation
for Restriction on the Use of Certain Institutions of Higher Education,
is proposed to be amended to include conforming changes.
III. Applicability to Contracts at or Below the Simplified Acquisition
Threshold (SAT) and for Commercial Products, Including Commercially
Available Off-the-Shelf (COTS) Items, and Commercial Services
This rule proposes to amend the solicitation provision at DFARS
252.209-7011, Representation for Restriction on the Use of Certain
Institutions of Higher Education. The provision at DFARS 252.209-7011
is prescribed at DFARS 209.170-4 for use in solicitations for
acquisitions to an institution of higher education, including
solicitations using Federal Acquisition Regulation (FAR) part 12
procedures for the acquisition of commercial products, including COTS
items, and commercial services. DoD does intend to apply the proposed
rule to contracts at or below the SAT, to contracts for the acquisition
of commercial products including COTS items, and for the acquisition of
commercial services.
A. Applicability to Contracts at or Below the Simplified Acquisition
Threshold
41 U.S.C. 1905 governs the applicability of laws to contracts or
subcontracts in amounts not greater than the simplified acquisition
threshold. It is intended to limit the applicability of laws to such
contracts or subcontracts. 41 U.S.C. 1905 provides that if a provision
of law contains criminal or civil penalties, or if the Federal
Acquisition Regulatory Council makes a written determination that it is
not in the best interest of the Federal Government to exempt contracts
or subcontracts at or below the SAT, the law will apply to them. The
Principal Director, Defense Pricing, Contracting, and Acquisition
Policy (DPCAP), is the appropriate authority to make comparable
determinations for regulations to be published in the DFARS, which is
part of the FAR system of regulations. DoD does intend to make that
determination. Therefore, this proposed rule will apply at or below the
simplified acquisition threshold.
B. Applicability to Contracts for the Acquisition of Commercial
Products Including COTS Items and for the Acquisition of Commercial
Services
10 U.S.C. 3452 exempts contracts and subcontracts for the
acquisition of commercial products, including COTS items, and
commercial services from provisions of law enacted after October 13,
1994, unless the Under Secretary of Defense (Acquisition and
Sustainment) (USD(A&S)) makes a written determination that it would not
be in
[[Page 66340]]
the best interest of DoD to exempt contracts for the procurement of
commercial products and commercial services from the applicability of
the provision or contract requirement, except for a provision of law
that--
Provides for criminal or civil penalties;
Requires that certain articles be bought from American
sources pursuant to 10 U.S.C. 4862 or that strategic materials critical
to national security be bought from American sources pursuant to 10
U.S.C. 4863; or
Specifically refers to 10 U.S.C. 3452 and states that it
shall apply to contracts and subcontracts for the acquisition of
commercial products (including COTS items) and commercial services.
Sections 1044 and 1045 of the NDAA for FY 2024 do not impose
criminal or civil penalties, do not require purchase pursuant to 10
U.S.C. 4862 or 4863, and do not refer to 10 U.S.C. 3452. Therefore,
sections 1044 and 1045 will not apply to the acquisition of commercial
services or commercial products including COTS items unless a written
determination is made. Due to delegations of authority, the Principal
Director, DPCAP is the appropriate authority to make this
determination.
DoD intends to make that determination to apply this statute to the
acquisition of commercial products including COTS items and to the
acquisition of commercial services. Therefore, this proposed rule will
apply to the acquisition of commercial products including COTS items
and to the acquisition of commercial services.
C. Determinations
To ensure compliance with the limitation on the use of funds, the
proposed rule must apply to all contracts with institutions of higher
education. An exception for acquisitions at or below the SAT, for the
acquisition of commercial products including COTS items, or for the
acquisition of commercial services would exclude the contracts intended
to be covered by the law, thereby undermining the overarching public
policy purpose of the law and the associated statutory funds
limitation.
IV. Expected Impact of the Rule
Although section 1044 of the NDAA for FY 2024 broadened the
definition of Confucius Institute, DoD expects there will be no change
to the number of offerors impacted by the representation requirement.
Research and data analysis by DoD subject matter experts has not
revealed any activity that would constitute a Confucius Institute as
defined in section 1044. However, DoD's process of outreach to
institutions is ongoing, in an effort to identify any institutes
meeting the new definition being hosted by any U.S. institution of
higher education. If it is determined an institution of higher
education is hosting an institute meeting the new definition of
Confucius Institute, and if the institute intends to continue
operating, the prohibition will be applied accordingly. Consequently,
de minimis associated burden exists since the proposed rule still only
requires the prospective offeror, when submitting an offer in response
to a solicitation, to represent compliance with the requirements of
section 1062 of the NDAA for FY 2021 as amended by sections 1044 and
1045 of the NDAA for FY 2024. Data from the Federal Procurement Data
System indicate that less than 10 unique entities awarded DoD contracts
in fiscal years 2021 through 2023 met the definition of an institution
of higher education; none of those entities hosted a Confucius
Institute as newly defined.
This proposed rule also includes the addition of the termination
date for the authority to waive the funds limitation. As provided in
section 1045 of the NDAA for FY 2024, the waiver authority will end on
October 1, 2026, and any waivers issued prior to that date will no
longer be effective as of October 1, 2026. To date, DoD has not issued
any waivers to the funds limitation, and DoD does not anticipate
issuing any waivers on or before October 1, 2026.
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 funds limitation affects a very limited number of
offerors and, therefore, has a limited impact. 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 revise the definition of Confucius
Institute and to implement an end date for the associated waiver
authority. The DFARS currently requires that none of the funds
authorized to be appropriated or otherwise made available for any
fiscal year for DoD may be provided to an institution of higher
education that hosts a Confucius Institute. Currently, this prohibition
may be waived.
The objective of the rule is to implement sections 1044 and 1045 of
the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2024
(Pub. L. 118-31), which is the legal basis for the rule. Section 1044
amends section 1062(d) of the NDAA for FY 2021 by revising the
definition of ``Confucius Institute'' to mean any program that receives
funding or support from the Chinese International Education Foundation
or the Center for Language Exchange Cooperation of the Ministry of
Education of the People's Republic of China, or any cultural institute
funded by the Government of the People's Republic of China. Section
1045 of the NDAA for FY 2024 amends section 1062(b) of the NDAA for FY
2021 to add a termination date of October 1, 2026, for the authority to
issue a waiver.
To assess the potential impact, the Federal Procurement Data System
(FPDS) was queried for FY 2021, FY 2022, and FY 2023 for DoD contracts
and purchase orders, including those for commercial products and
commercial services, awarded to institutions of higher education that
meet the definition in 20 U.S.C. 1002. The FPDS data reflect a total of
104 contract awards to 9 unique entities over the entire three fiscal
years. All awards were made to other than small entities. Entities in
FPDS categorized as higher-level institutions of education are
designated only as other than small entities.
This rule does not include any new reporting, recordkeeping, or
other compliance requirements for small entities, unless they are
associated with an institution of higher education that hosts a
Confucius Institute.
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 of the statute.
DoD invites comments from small business concerns and other
interested
[[Page 66341]]
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 proposed 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 2024-D023),
in correspondence.
VII. Paperwork Reduction Act
This proposed 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 209 and 252
Government procurement.
Jennifer D. Johnson,
Editor/Publisher, Defense Acquisition Regulations System.
Therefore, the Defense Acquisition Regulations System proposes to
amend 48 CFR parts 209 and 252 as follows:
0
1. The authority citation for part 209 and 252 continues to read as
follows:
Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.
PART 209--CONTRACTOR QUALIFICATIONS
0
2. Amend section 209.170-1 by revising the definition of ``Confucius
Institute'' to read as follows:
209.170-1 Definitions.
* * * * *
Confucius Institute means--
(1) Any program that receives funding or support from--
(i) The Chinese International Education Foundation; or
(ii) The Center for Language Exchange Cooperation of the Ministry
of Education of the People's Republic of China; or
(2) Any cultural institute directly or indirectly funded by the
government of the People's Republic of China.
* * * * *
0
3. Revise section 209.170-3 to read as follows:
209.170-3 Waiver of restriction.
The restriction in 209.170-2 can be waived by the Office of the
Under Secretary of Defense (Research and Engineering), without power of
delegation, in accordance with the Confucius Institute Waiver Program
guidance. The waiver authority terminates on October 1, 2026. Any
waiver issued shall not apply on or after that date. See PGI 209.170-3.
PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
0
4. Amend section 252.209-7011--
0
a. By revising the provision date;
0
b. In paragraph (a) by revising the definition of ``Confucius
Institute''; and
0
c. By revising paragraph (b).
The revisions read as follows:
252.209-7011 Representation for Restriction on the Use of Certain
Institutions of Higher Education.
* * * * *
Representation for Restriction on the Use of Certain Institutions of
Higher Education (Date)
(a) * * *
Confucius Institute means--
(1) Any program that receives funding or support from--
(i) The Chinese International Education Foundation; or
(ii) The Center for Language Exchange Cooperation of the
Ministry of Education of the People's Republic of China; or
(2) Any cultural institute directly or indirectly funded by the
government of the People's Republic of China.
* * * * *
(b) Restriction. As required by section 1062 of the National
Defense Authorization Act for Fiscal Year 2021 (Pub. L. 116-283),
DoD may not award a contract with any institution of higher
education that hosts a Confucius Institute. Section 1062 prohibits
DoD from providing funding to any U.S. institution of higher
education hosting a Confucius Institute unless that institution
receives a waiver from the Department of Defense Office of the Under
Secretary of Defense for Research and Engineering (OUSD(R&E)). The
waiver authority terminates on October 1, 2026. Any waiver issued
shall not apply on or after that date. See the OUSD(R&E) Confucius
Institute Waiver Program Guidance to U.S. Institutions of Higher
Education at https://rt.cto.mil/wp-content/uploads/Confucius-Institute-Waiver-Program-Guidance-28Mar2023.pdf.
* * * * *
[FR Doc. 2024-18111 Filed 8-14-24; 8:45 am]
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