DFARS CHANGE NOTICE 19990914

[Federal Register: September 14, 1999 (Volume 64, Number 177)]

[Rules and Regulations]

DEPARTMENT OF DEFENSE

48 CFR Part 225

[DFARS Case 99-D020]

Defense Federal Acquisition Regulation Supplement; Acquisitions for Foreign Military Sales

AGENCY: Department of Defense (DoD).

ACTION: Final rule.

SUMMARY: The Director of Defense Procurement has issued a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to clarify that the contracting officer must not require the submission of cost or pricing data for a foreign military sales acquisition if the foreign government has conducted a competition resulting in adequate price competition. The rule also clarifies that all costs incurred for offset agreements with a foreign government or international organization are allowable if financed wholly with customer cash or repayable foreign military finance credits.

EFFECTIVE DATE: September 14, 1999.

FOR FURTHER INFORMATION CONTACT: Ms. Amy Williams, Defense Acquisition Regulations Council, PDUSD (A&T) DP (DAR), IMD 3D139, 3062 Defense Pentagon, Washington, DC 20301-3062. Telephone (703) 602-0288; telefax (703) 602-0350. Please cite DFARS Case 99-D020.

SUPPLEMENTARY INFORMATION:

A. Background This final rule amends DFARS 225.7303 to clarify that the contracting officer must not require the submission of cost or pricing data for a foreign military sales acquisition if the foreign government has conducted a competition resulting in adequate price competition. Such competition meets the requirement of FAR 15.403-1(b)(1), which states that the contracting officer must not require the submission of cost or pricing data when prices are based on adequate price competition.

This rule also amends DFARS 225.7303-2 and 225.7303-5 to clarify that all costs incurred for offset agreements with a foreign government or international organization are allowable if financed wholly with customer cash or repayable foreign military finance credits. In 1996, DoD amended the language at DFARS 225.7303-2 to clarify that U.S. contractors may recover the full cost necessary to implement such agreements (61 FR 7739, February 29, 1996; 60 FR 49358, September 25, 1995). Since there appear to be differences in the way the language is being interpreted and implemented, this rule makes further clarifications.

This rule was not subject to Office of Management and Budget review under Executive Order 12866, dated September 30, 1993.

B. Regulatory Flexibility Act This final rule does not constitute a significant revision within the meaning of FAR 1.501 and Public Law 98-577 and publication for public comment is not required. However, DoD will consider comments form small entities concerning the affected DFARS subpart in accordance with 5 U.S.C. 610. Such comments should cite DFARS Case 99-D020.

C. Paperwork Reduction Act The Paperwork Reduction Act does not apply because this rule does not impose any information collection requirements that require the approval of the Office of Management and Budget under 44 U.S.C. 3501, et seq.

List of Subjects in 48 CFR Part 225

Government procurement. Michele P. Peterson,Executive Editor, Defense Acquisition Regulations Council.

Therefore, 48 CFR Part 225 is amended as follows:

DFARS Case 99-D020

Acquisitions for Foreign Military Sales

Final Rule

PART 225-FOREIGN ACQUISITION

* * * * *

SUBPART 225.73--ACQUISITIONS FOR FOREIGN MILITARY SALES

* * * * *.

225.7303 Pricing acquisitions for FMS.

[(a)] Price FMS contracts using the same principles as are used in pricing other defense contracts. Application of the pricing principles in FAR Parts 15 and 31 to an FMS contract, however, may result in prices that differ from other defense contract prices for the same item due to the considerations in this section.

[(b) If the foreign government has conducted a competition resulting in adequate price competition (see FAR 15.403-1(b)(1)), the contracting officer must not require the submission of cost or pricing data. The contracting officer should consult with the foreign government through security assistance personnel to determine if adequate price competition has occurred.]

* * * * *

225.7303-2 Cost of doing business with a foreign government or an international organization.

* * * * *

* * * * *

225.7303-5 Acquisitions wholly paid for from nonrepayable funds.

* * * * *

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[Federal Register: September 14, 1999 (Volume 64, Number 177)]

[Rules and Regulations]

DEPARTMENT OF DEFENSE

48 CFR Parts 237 and 252

[DFARS Case 99-D018]

Defense Federal Acquisition Regulation Supplement; Officials NotTo Benefit Clause

AGENCY: Department of Defense (DoD).

ACTION: Final rule.

SUMMARY: The Director of Defense Procurement has issued a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to update the formats used for educational service agreements and patent license contracts to reflect the removal of the Officials Not to

Benefit clause from the Federal Acquisition Regulation (FAR).

EFFECTIVE DATE: September 14, 1999.

FOR FURTHER INFORMATION CONTACT: Ms. Kathleen Fenk, Defense Acquisition

Regulations Council, PDUSD (A&T) DP (DAR), IMD 3D139, 3062 Defense Pentagon, Washington, DC 20301-3062. Telephone (703) 602-0296; telefax (703) 602-0350. Please cite DFARS Case 99-D018.

SUPPLEMENTARY INFORMATION:

A. Background This final rule amends the format for educational service agreements at DFARS 237.7204, and the Patent License and Release Contract clause at DFARS 252.227-7012, to remove references to the clause at FAR 52.203-1, Officials Not to Benefit. The clause at FAR 52.203-1 was removed from the FAR on September 19, 1995 (60 FR 37773, July 21, 1995). This rule also makes other minor editorial changes to update the DFARS text at 237.7204 and 252.227-7012.

This rule was not subject to Office of Management and Budget review under Executive Order 12866, dated September 30, 1993.

B. Regulatory Flexibility Act This final rule does not constitute a significant revision within

the meaning of FAR 1.501 and Public Law 98-577 and publication for public comment is not required. However, DoD will consider comments from small entities concerning the affected DFARS subparts in accordance with 5 U.S.C. 610. Such comments should cite DFARS Case 99-

D018.

C. Paperwork Reduction Act The Paperwork Reduction Act does not apply because this rule does not impose any information collection requirements that require the approval of the Office of Management and Budget under 44 U.S.C. 3501, et seq.

List of Subjects in 48 CFR Parts 237 and 252

Government procurement. Michele P. Peterson, Executive Editor, Defense Acquisition Regulations Council.

Therefore, 48 CFR Parts 237 and 252 are amended as follows:

DFARS Case 99-D018

Officials Not to Benefit Clause

Final Rule

PART 237--SERVICE CONTRACTING

* * * * *

SUBPART 237.72--EDUCATIONAL SERVICE AGREEMENTS

* * * * *

237.7204 Format and clauses for educational service agreements.

* * * * *

GENERAL PROVISIONS

Use the following clauses in educational service agreements-[:]

* * * * *

SUBPART 252.2-TEXT OF PROVISIONS AND CLAUSES

252.227-7012 Patent License and Release Contract.

_______________________ (Contract No.)

PATENT LICENSE AND RELEASE CONTRACT (AUG 1984 [SEP 1999])

THIS CONTRACT is effective as of the ____ day of _[[month, year]]_19__, between the UNITED STATES OF AMERICA (hereinafter called the Government), and _____________________________ (hereinafter called the Contractor), [(]a corporation organized and existing under the laws of the State of _______________), (a partnership consisting of _____________________), (an individual trading as ____________________), of the City of _______________________, in the State of _________________.

WHEREAS, [the] Contractor warrants that he [it] has the right to grant the within license and release, and the Government desires to procure the same, and

WHEREAS, this contract is authorized by law, including 10 U.S.C. 2386.

NOW THEREFORE, in consideration of the grant, release and agreements hereinafter recited, the parties have agreed as follows:

*If only a release is procured, delete this article; if an assignment is procured, use the clause at 252.227-7011.

**When the Contractor is an individual, change "successors" to "heirs"; if a partnership, modify appropriately.

(End of clause)

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