DFARS Change Notice 20000413

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

DEPARTMENT OF DEFENSE

48 CFR Parts 213, 225, 242, and 252

[DFARS Case 98-D028]

Defense Federal Acquisition Regulation Supplement; Foreign Acquisition

AGENCY: Department of Defense (DoD).

ACTION: Final rule.

SUMMARY: The Acting Director of Defense Procurement has issued a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS). These amendments conform the DFARS to the Federal Acquisition Regulation (FAR) Amendments pertaining to foreign acquisition that were published in the Federal Register on December 27, 1999.

EFFECTIVE DATE: April 13, 2000.

FOR FURTHER INFORMATION CONTACT: Ms. Amy Williams, Defense Acquisition

Regulations Council, PDUSD (AT&L) DP (DAR), IMD 3D139, 3062 Defense Pentagon, Washington, DC 20301-3062. Telephone (703) 602-0288; telefax (703) 602-0350. Please cite DFARS Case 98-D028.

SUPPLEMENTARY INFORMATION:

A. Background

This final rule amends DFARS Part 225, Foreign Acquisition, and updates related references, for conformance with the FAR Part 25 rewrite that was published at 64 FR 72416 on December 27, 1999 (Federal Acquisition Circular 97-15, Item II). The rule reorganizes the existing DFARS text to align it with the revised FAR text. The rule makes no substantive change to DFARS policy pertaining to foreign acquisition.

The following list summarizes the reorganization of the DFARS text:

Text previously located at

Relocated to

225.000-70

225.003

225.000-71

225.001

225.102

225.103

225.105

225.502

Table 25-1

225.504

225.107

225.170

225.108

225.104

225.109(a)

225.1101(1)

225.109(b)

225.171(a)

225.109(d)

225.1101(2)

225.109-70(a)

225.1101(3)

225.109-70(b)

225.171(b)

225.303

225.304

225.305-70

225.1103(1)

225.401

225.003

225.402(c)

225.403

225.403

225.401

225.403-70

225.401-70

225.405

225.408

225.408

225.11

225.602

225.901

225.603

225.902

225.604

225.903

225.605

FAR 25.1101(e)(2

225.605-70

225.11

225.702

225.701

225.970

225.1070

225.971

225.1103(2)

225.972

225.1103(3)

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 98-D028.

C. Paperwork Reduction Act

The Paperwork Reduction Act does not apply because the 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 213, 225, 242, and 252

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

Therefore, 48 CFR parts 213, 225, 242, and 252 are amended as follows:

1. The authority citation for 48 CFR parts 213, 225, 242, and 252 continues to read as follows:

Foreign Acquisition

DFARS Case 98-D028

Final rule

PART 213-SIMPLIFIED ACQUISITION PROCEDURES

* * * * *

213.302-5 Clauses.

* * * * *

(d) When using the clause at FAR 52.213-4, delete the reference to the clause at FAR 52.225-3[1], Buy American Act-[Balance of Payments Program-]Supplies. * * *

* * * * *

PART 225-FOREIGN ACQUISITION

225.000-70 Definitions. 1

As used in this part-

225.000-71 General guidelines.

To apply the policies and procedures of this part, analyze and evaluate offers of foreign end products generally as follows-[:]

209.104-1(g).

[225.003 Definitions. 2

As used in this part-

(1) "Caribbean Basin country end product" includes petroleum or any product derived from petroleum.

(5) "Eligible product" means, instead of the definition at FAR 25.003, a designated, NAFTA, or Caribbean Basin country end product in the categories listed in 225.401-70.

SUBPART 225.1--BUY AMERICAN ACT--SUPPLIES

225.102[3] Policy[Exceptions].

[(c) The cost of a domestic end product is unreasonable if it is not the low evaluated offer when evaluated under Subpart 225.5.]4

225.103 Agreements with certain foreign governments.

See 225.872.

[225.104 Nonavailable articles. 5

(B) Sperm oil.]

225.105 Evaluating offers.6

Use the following procedures instead of those in FAR 25.105. These procedures do not apply to acquisitions of information technology end products in Federal Supply Group 70 or 74 that are subject to the Trade Agreements Act.

TABLE 25-1, EVALUATION

 

Example 1

 

Alternate I: Duty Not Exempted for Nonqualifying Country Offers:

 

Nonqualifying Country Offer (including $100 duty)

$

6,000

 

Domestic Offer

8,900

 

Qualifying Country Offer

9,100

 

Award on Domestic Offer. The 50% evaluation factor is added to the nonqualifying country offer, inclusive of duty, yielding an evaluated price of $9,000.

 

Alternate II: Duty Exempted:

 
 

Nonqualifying Country Offer (including $1,000 duty)

$

600,000

 

Domestic Offer

 

910,000

 

Qualifying Country Offer

 

920,000

 

Award on Nonqualifying Country Offer. The addition of the evaluation factor yields an evaluated price of $900,000. Since duty is being exempted for nonqualifying country offers, the duty is subtracted from the offered price which is awarded at $599,000.

 

Example 2

 

Alternate I: Duty Not Exempted for Nonqualifying Country Offers:

 
 

Nonqualifying Country Offer (including $100 duty)

$

6,000

 

Domestic Offer

 

8,500

 

Qualifying Country Offer

 

7,800

 

Award on Nonqualifying Country Offer. Since the qualifying country offer is lower than the domestic offer, the nonqualifying country offer is evaluated without the factor. Since duty is not being exempted for nonqualifying country offers, the offer is evaluated and award is made at the price inclusive of duty ($6,000).

 

Alternate II: Duty Exempted:

 
 

Nonqualifying Country Offer (including $1,000 duty)

$

880,500

 

Domestic Offer

 

950,000

 

Qualifying Country Offer

 

880,000

 

Award on Nonqualifying Country Offer. Again, the qualifying country offer is lower than the domestic offer. The nonqualifying country offer is, therefore, evaluated without the factor. Since duty is being exempted for nonqualifying country offers, the duty identified by the offeror is subtracted from the offered price, which is evaluated and awarded at $879,500.

 

Example 3

 

Alternate I: Duty Not Exempted for Nonqualifying Country Offers:

 
 

Nonqualifying Country Offer (including $150 duty)

$

9,600

 

Qualifying Country Offer

 

9,500

 

Award on Qualifying Country Offer. Since no domestic offers are received, the nonqualifying country offer is evaluated without the evaluation factor. Since duty is not being exempted and would be paid by the Government, the nonqualifying country offer is evaluated inclusive of duty.

 

Alternate II: Duty Exempted:

 
 

Nonqualifying Country Offer (including $1,000 duty)

$

880,500

 

Qualifying Country Offer

 

880,000

 

Award on Nonqualifying Country Offer. Since no domestic offers are received, the nonqualifying country offer is evaluated without the evaluation factor. Since duty is being exempted, duty is subtracted from the nonqualifying country offer, which is evaluated and awarded at $879,500.

 

Example 4

 

Alternate I:

 
 

Offer of U.S. Made End Product which is not a Domestic Offer

$

800,000

 

Domestic Offer

 

820,000

 

Eligible Product

 

830,000

 

Award on Domestic End Product. U.S. made end products which are not also domestic end products are evaluated the same as nonqualifying country end products. Adding the 50% evaluation factor yields an evaluated price of $1,200,000.

 

Alternate II:

 
 

Offer of U.S. Made End Product which is not a Domestic Offer

$

800,000

 

Eligible Product

 

820,000

 

Domestic Offer

 

830,000

 

Award on U.S. Made End Product. Adding the 50% evaluation factor to the U.S. made end product would not result in the award of a domestic end product since the eligible product, which is evaluated the same as a qualifying country offer, is lower. All offers are evaluated without the factor.

225.107[0] Acquisition from or through other Government agencies.

Contracting activities must apply the evaluation procedures in [Subpart] 225.105 when using Federal supply schedules.

225.108 Excepted articles, materials, and supplies. 7

Sperm oil.

225.109 Solicitation provisions and contract clauses. 8

[225.171 Solicitations.]

(b[a]) For oral solicitations[,] inform prospective vendors that only domestic and qualifying country end products are acceptable, except nonqualifying country end products are acceptable if-

225.109-70 Additional provisions and clauses.

SUBPART 225.2--BUY AMERICAN ACT--CONSTRUCTION MATERIALS

225.202 Policy[Exceptions].

225.206 Noncompliance.

SUBPART 225.3--BALANCE OF PAYMENTS PROGRAM

225.302 Policy.

225.303[4] Procedures.

225.305 Solicitation provision and contract clause. 9

225.305-70 Additional clause.

In order to allow accurate reporting, by cognizant accounting and disbursing officers, of foreign and domestic expenditures, use the clause at 252.225-7005, Identification of Expenditures in the United States, in all negotiated contracts over $25,000 where-

SUBPART 225.4--TRADE AGREEMENTS

225.401 Definitions. 10

"Caribbean Basin country end product" includes petroleum or any product derived from petroleum.

"Eligible product" means, instead of the definition at FAR 25.401, a designated, NAFTA, or Caribbean Basin country end product in the categories listed in 225.403-70.

[225.401 Exceptions. 11

225.401-70 Products subject to trade agreement acts.

Foreign end products subject to the Trade Agreements Act and NAFTA are those in the following Federal supply groups (FSG). If a product is not in one of the listed groups, the Trade Agreements Act and NAFTA do not apply. The definition of Caribbean Basin country end products in FAR 25.003 excludes those end products that are not eligible for duty-free treatment under 19 U.S.C. 2703(b). However, 225.003 expands the definition of Caribbean Basin country end products to include petroleum and any product derived from petroleum. The list of products has been annotated to indicate those products that are eligible for designated and NAFTA countries, but are not presently eligible for Caribbean Basin countries.

FSG

Category/Description

   

22

Railway equipment

23

Motor vehicles, trailers, and cycles (except 2350 and buses under 2310)

24

Tractors

25

Vehicular equipment components

26

Tires and tubes

29

Engine accessories

30

Mechanical power transmission equipment

32

Woodworking machinery and equipment

34

Metalworking machinery

35

Service and trade equipment

36

Special industry machinery (except 3690)

37

Agricultural machinery and equipment

38

Construction, mining, excavating, and highway maintenance equipment

39

Materials handling equipment

40

Rope, cable, chain and fittings

41

Refrigeration and air conditioning equipment

42

Fire fighting, rescue and safety equipment

43

Pumps and compressors

44

Furnace, steam plant and drying equipment (except 4470)

45

Plumbing, heating, and sanitation equipment

46

Water purification and sewage treatment equipment

47

Piping, tubing, hose, and fitting

48

Valves

49

Maintenance and repair shop equipment (except 4920-4927, 4931-4935, 4960)

53

Hardware and abrasives

54

Prefabricated structures and scaffolding

55

Lumber, millwork, plywood, and veneer

56

Construction and building materials

61

Electric wire, and power and distribution equipment

62

Lighting fixtures and lamps

63

Alarm and signal systems

65

Medical, dental, and veterinary equipment and supplies

66

Instruments and laboratory equipment (except aircraft clocks under 6645) - See FAR 25.003 exclusion of certain watches and watch parts for certain Caribbean Basin countries

67

Photographic equipment

68

Chemicals and chemical products

69

Training aids and devices

70

General purpose ADPE, software, supplies, and support equipment

71

Furniture

72

Household and commercial furnishings and appliances

73

Food preparation and serving equipment

74

Office machines, visible record equipment and ADP equipment

75

Office supplies and devices

76

Books, maps, and other publications

77

Musical instruments, phonographs, and home type radios

78

Recreational and athletic equipment

79

Cleaning equipment and supplies

80

Brushes, paints, sealers, and adhesives

81

Containers, packaging and packing supplies (except 8140)

84

Luggage (only 8460) - See FAR 25.003 for exclusion of luggage for Caribbean Basin countries

85

Toiletries

87

Agricultural supplies

88

Live animals

91

Fuels, oils, and waxes

93

Nonmetallic fabricated materials

94

Nonmetallic crude materials

96

Ores, minerals, and their primary products

99

Miscellaneous ]

225.402 Policy[General].

[225.403 Trade Agreements Act.]

225.403 Exceptions. 12

225.403-70 Products subject to trade agreement acts.

Foreign end products subject to the Trade Agreements Act and NAFTA are those in the following Federal supply groups (FSG). If a product is not in one of the listed groups, the Trade Agreements Act and NAFTA do not apply. The definition of Caribbean Basin country end products in FAR 25.401 excludes those end products which are not eligible for duty-free treatment under 19 U.S.C. 2703(b). However, 225.401 expands the definition of Caribbean Basin country end products to include petroleum and any product derived from petroleum. The list of products has been annotated to indicate those products which are eligible for designated and NAFTA countries, but are not presently eligible for Caribbean Basin countries.

FSG

Category/Description

   

22

Railway equipment

23

Motor vehicles, trailers, and cycles (except 2350 and buses under 2310)

24

Tractors

25

Vehicular equipment components

26

Tires and tubes

29

Engine accessories

30

Mechanical power transmission equipment

32

Woodworking machinery and equipment

34

Metalworking machinery

35

Service and trade equipment

36

Special industry machinery (except 3690)

37

Agricultural machinery and equipment

38

Construction, mining, excavating, and highway maintenance equipment

39

Materials handling equipment

40

Rope, cable, chain and fittings

41

Refrigeration and air conditioning equipment

42

Fire fighting, rescue and safety equipment

43

Pumps and compressors

44

Furnace, steam plant and drying equipment (except 4470)

45

Plumbing, heating, and sanitation equipment

46

Water purification and sewage treatment equipment

47

Piping, tubing, hose, and fitting

48

Valves

49

Maintenance and repair shop equipment (except 4920-4927, 4931-4935, 4960)

53

Hardware and abrasives

54

Prefabricated structures and scaffolding

55

Lumber, millwork, plywood, and veneer

56

Construction and building materials

61

Electric wire, and power and distribution equipment

62

Lighting fixtures and lamps

63

Alarm and signal systems

65

Medical, dental, and veterinary equipment and supplies

66

Instruments and laboratory equipment (except aircraft clocks under 6645) - See FAR 25.401 exclusion of certain watches and watch parts for certain Caribbean Basin countries

67

Photographic equipment

68

Chemicals and chemical products

69

Training aids and devices

70

General purpose ADPE, software, supplies, and support equipment

71

Furniture

72

Household and commercial furnishings and appliances

73

Food preparation and serving equipment

74

Office machines, visible record equipment and ADP equipment

75

Office supplies and devices

76

Books, maps, and other publications

77

Musical instruments, phonographs, and home type radios

78

Recreational and athletic equipment

79

Cleaning equipment and supplies

80

Brushes, paints, sealers, and adhesives

81

Containers, packaging and packing supplies (except 8140)

84

Luggage (only 8460) - See FAR 25.401 for exclusion of luggage for Caribbean Basin countries

85

Toiletries

87

Agricultural supplies

88

Live animals

91

Fuels, oils, and waxes

93

Nonmetallic fabricated materials

94

Nonmetallic crude materials

96

Ores, minerals, and their primary products

99

Miscellaneous

225.405[8] Procedures.

225.408 Solicitation provisions and contract clauses. 13

[SUBPART 225.5-EVALUATING FOREIGN OFFERS-SUPPLY CONTRACTS14

225.502 Application.

Use the following procedures instead of those in FAR 25.502. These procedures do not apply to acquisitions of information technology end products in Federal Supply Group 70 or 74 that are subject to the Trade Agreements Act.

225.504 Evaluation examples.

 

(1) Example 1.

 

(i) Alternate I: Duty Not Exempted for Nonqualifying Country Offers:

 

Nonqualifying Country Offer (including $100 duty)

$

6,000

 

Domestic Offer

8,900

 

Qualifying Country Offer

9,100

 

Award on Domestic Offer. The 50% evaluation factor is added to the nonqualifying country offer, inclusive of duty, yielding an evaluated price of $9,000.

 

(ii) Alternate II: Duty Exempted:

 
 

Nonqualifying Country Offer (including $1,000 duty)

$

600,000

 

Domestic Offer

 

910,000

 

Qualifying Country Offer

 

920,000

 

Award on Nonqualifying Country Offer. The addition of the evaluation factor yields an evaluated price of $900,000. Since duty is being exempted for nonqualifying country offers, the duty is subtracted from the offered price, which is awarded at $599,000.

 

(2) Example 2.

 

(i) Alternate I: Duty Not Exempted for Nonqualifying Country Offers:

 
 

Nonqualifying Country Offer (including $100 duty)

$

6,000

 

Domestic Offer

 

8,500

 

Qualifying Country Offer

 

7,800

 

Award on Nonqualifying Country Offer. Since the qualifying country offer is lower than the domestic offer, the nonqualifying country offer is evaluated without the factor. Since duty is not being exempted for nonqualifying country offers, the offer is evaluated and award is made at the price inclusive of duty ($6,000).

 

(ii) Alternate II: Duty Exempted:

 
 

Nonqualifying Country Offer (including $1,000 duty)

$

880,500

 

Domestic Offer

 

950,000

 

Qualifying Country Offer

 

880,000

   

Award on Nonqualifying Country Offer. Again, the qualifying country offer is lower than the domestic offer. The nonqualifying country offer is, therefore, evaluated without the factor. Since duty is being exempted for nonqualifying country offers, the duty identified by the offeror is subtracted from the offered price, which is evaluated and awarded at $879,500.

 

(3) Example 3.

 

(i) Alternate I: Duty Not Exempted for Nonqualifying Country Offers:

 
 

Nonqualifying Country Offer (including $150 duty)

$

9,600

 

Qualifying Country Offer

 

9,500

 

Award on Qualifying Country Offer. Since no domestic offers are received, the nonqualifying country offer is evaluated without the evaluation factor. Since duty is not being exempted and would be paid by the Government, the nonqualifying country offer is evaluated inclusive of duty.

 

(ii) Alternate II: Duty Exempted:

 
 

Nonqualifying Country Offer (including $1,000 duty)

$

880,500

 

Qualifying Country Offer

 

880,000

 

Award on Nonqualifying Country Offer. Since no domestic offers are received, the nonqualifying country offer is evaluated without the evaluation factor. Since duty is being exempted, duty is subtracted from the nonqualifying country offer, which is evaluated and awarded at $879,500.

 

(4) Example 4.

 

(i) Alternate I:

 
 

Offer of U.S. Made End Product which is not a Domestic Offer

$

800,000

 

Domestic Offer

 

820,000

 

Eligible Product

 

830,000

 

Award on Domestic End Product. U.S. made end products which are not also domestic end products are evaluated the same as nonqualifying country end products. Adding the 50% evaluation factor yields an evaluated price of $1,200,000.

 

(ii) Alternate II:

 
 

Offer of U.S. Made End Product which is not a Domestic Offer

$

800,000

 

Eligible Product

 

820,000

 

Domestic Offer

 

830,000

 

Award on U.S. Made End Product. Adding the 50% evaluation factor to the U.S. made end product would not result in the award of a domestic end product since the eligible product, which is evaluated the same as a qualifying country offer, is lower. All offers are evaluated without the factor.]

SUBPART 225.6--CUSTOMS AND DUTIES 15

225.602 Policy.

225.603 Procedures.

225.604 Exempted supplies.

225.605 Contract clause. 16

225.605-70 Additional solicitation provisions and contract clauses.

SUBPART 225.7--RESTRICTIONS ON CERTAIN FOREIGN PURCHASES[PROHIBITED SOURCES]

225.702[1] Restrictions.

See 209.104-1(g)(i) for restrictions on contracting with firms owned or controlled by foreign governments that support terrorism. See 209.104-1(g)(ii) for prohibition on award of a DoD contract under a national security program to an entity controlled by a foreign government when access to proscribed information is required to perform the contract.

* * * * *

SUBPART 225.8-[OTHER] INTERNATIONAL AGREEMENTS AND COORDINATION

225.801 International agreements[General].

* * * * *

[SUBPART 225.9--CUSTOMS AND DUTIES 17

225.901 Policy.

225.902 Procedures.

225.903 Exempted supplies.

SUBPART 225.9-[10]-ADDITIONAL FOREIGN ACQUISITION CLAUSES [REGULATIONS]

225.9[10]70 Clause deviations in overseas contracts.

See 201.403(2) for approval authority for clause deviations in overseas contracts with governments of North Atlantic Treaty Organization (NATO) countries or other allies or with United Nations or NATO organizations.

225.971 Correspondence in English. 18

Use the clause at 252.225-7041, Correspondence in English, in solicitations and contracts when contract performance will be wholly or in part in a foreign country.

225.972 Authorization to perform.

Use the clause at 252.225-7042, Authorization to Perform, in solicitations and contracts when contract performance will be wholly or in part in a foreign country.

* * * * *

[SUBPART 225.11-SOLICITATION PROVISIONS AND CONTRACT CLAUSES 19

225.1101 Acquisition of supplies.

Duty-Free Entry.

(B) Use the clause with its Alternate I when the estimated value is between $25,000 and $53,150.

and contracts for supplies and services when the clause at 252.225-7007, Buy American Act--Trade Agreements--Balance of Payments Program; 252.225-7021, Trade Agreements; or 252.225-7036, Buy American Act--North American Free Trade Agreement Implementation Act-Balance of Payments Program, is used.

225.1103 Other provisions and clauses.

(1) In order to allow accurate reporting, by cognizant accounting and disbursing officers, of foreign and domestic expenditures, use the clause at 252.225-7005, Identification of Expenditures in the United States, in all negotiated contracts over $25,000 where-

(2) Use the clause at 252.225-7041, Correspondence in English, in solicitations and contracts when contract performance will be wholly or in part in a foreign country.

(3) Use the clause at 252.225-7042, Authorization to Perform, in solicitations and contracts when contract performance will be wholly or in part in a foreign country.]

* * * * *

PART 242-CONTRACT ADMINISTRATION AND AUDIT SERVICES

* * * * *

242.302 Contract administration functions.

* * * * *

PART 252-SOLICITATION PROVISIONS AND CONTRACT CLAUSES

* * * * *

252.225-7000 Buy American Act--Balance of Payments Program Certificate.

As prescribed in 225.109(a)[1101(1)], use the following provision:

* * * * *

252.225-7001 Buy American Act and Balance of Payments Program.

As prescribed in 225.109(d)[1101(2)], use the following clause:

* * * * *

252.225-7002 Qualifying Country Sources as Subcontractors.

As prescribed in 225.109-70(a)[1101(3)], use the following clause:

* * * * *

252.225-7003 Information for Duty-Free Entry Evaluation.

As prescribed in 225.605-70(d)[1101(4)], use the following provision:

* * * * *

ALTERNATE I (MAR 1998).

As prescribed in 225.605-70(d)[1101(4)], substitute the following paragraph (a) for paragraph (a) of the basic clause:

* * * * *

252.225-7005 Identification of Expenditures in the United States.

As prescribed in 225.305-70[1103(1)], use the following clause:

* * * * *

252.225-7006 Buy American Act--Trade Agreements--Balance of Payments Program Certificate.

As prescribed in 225.408(a)(i)[1101(5)], use the following provision:

* * * * *

252.225-7007 Buy American Act--Trade Agreements--Balance of Payments Program.

As prescribed in 225.408(a)(ii)[1101(6)], use the following clause:

* * * * *

252.225-7008 Supplies to be Accorded Duty-Free Entry.

As prescribed in 225.605-70(e)[1101(7)], use the following clause:

* * * * *

252.225-7009 Duty-Free Entry--Qualifying Country Supplies (End Products and Components).

As prescribed in 225.605-70(a)[1101(8)], use the following clause:

* * * * *

252.225-7010, Duty-Free Entry-Additional Provisions.

As prescribed in 225.605-70(c)[1101(9)], use the following clause:

* * * * *

252.225-7020 Trade Agreements Certificate.

As prescribed in 225.408(a)(iii)[1101(10)], use the following provision:

* * * * *

252.225-7021 Trade Agreements.

As prescribed in 225.408(a)(iv)[1101(11)], use the following clause:

* * * * *

252.225-7035 Buy American Act--North American Free Trade Agreement Implementation

Act--Balance of Payments Program Certificate.

As prescribed in 225.408(a)(v)[1101(12)], use the following provision:

* * * * *

ALTERNATE I (MAR 1998)

As prescribed in 225.408(a)(v)(B)(2)[1101(12)(ii)], substitute the phrase "Canadian end product" for the phrase "NAFTA country end product" in paragraph (a); and substitute the phrase "Canadian end products" for the phrase "NAFTA country end products" in paragraphs (b) and (c)(2)(ii) of the basic clause.

252.225-7036 Buy American Act--North American Free Trade Agreement Implementation

Act--Balance of Payments Program.

As prescribed in 225.408(a)(vi)[1101(13)], use the following clause:

* * * * *

ALTERNATE I (SEP 1999)

As prescribed in 225.408(a)(vi)(B)(2)[1101(13)(i)(B)], substitute the following paragraphs (a)(6), (c), and (d) for paragraphs (a)(6), (c), and (d) of the basic clause:

* * * * *

252.225-7037 Duty-Free Entry--Eligible End Products.

As prescribed in 225.605-70(b)[1101(14)], use the following clause:

* * * * *

252.225-7041 Correspondence in English.

As prescribed in 225.971[1103(2)], use the following clause:

* * * * *

252.225-7042 Authorization to Perform.

As prescribed in 225.972[1103(3)], use the following clause:

* * * *

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

DEPARTMENT OF DEFENSE

48 CFR Part 226

[DFARS Case 99-D300]

Defense Federal Acquisition Regulation Supplement; Utilization of Indian Organizations and Indian-Owned Economic Enterprises

AGENCY: Department of Defense (DoD).

ACTION: Final rule

SUMMARY: The Acting Director of Defense Procurement has issued a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to revise procedures pertaining to the Indian Incentive Program. The Program provides for incentive payments to Government

contractors that use Indian organizations and Indian-owned economic enterprises as subcontractors. This rule reflects new statutory provisions that permit small business concerns to participate in the

Indian Incentive Program.

EFFECTIVE DATE: April 13, 2000.

FOR FURTHER INFORMATION CONTACT: Ms. Susan Schneider, Defense Acquisition Regulations Council, PDUSD (AT&L) DP (DAR), IMD 3D139, 3062 Defense Pentagon, Washington, DC 20301-3062. Telephone (703) 602-0262; telefax (703) 602-0350. Please cite DFARS Case 99-D300.

SUPPLEMENTARY INFORMATION:

A. Background

The rule revises DFARS Subpart 226.1 to update procedures pertaining to the Indian Incentive Program. Section 504 of the Indian Financing Act of 1974 (25 U.S.C. 1544) established the Indian Incentive Program, which provides for payment of incentives to Government contractors that use Indian organizations and Indian-owned economic enterprises as subcontractors. Prior to fiscal year 1999, annual appropriations acts restricted DoD payments under the Program to those contractors that submitted small business subcontracting plans pursuant to 15 U.S.C. 637(d) or Section 854 of Public Law 101-89 (15 U.S.C. 637 note). Since small business concerns are not required to submit

subcontracting plans, small businesses were excluded from participation in the Indian Incentive Program under DoD contracts. Section 8024 of the DoD Appropriations Act for Fiscal Year 1999 (Public Law 105-262) and Section 8024 of the DoD Appropriations Act for Fiscal Year 2000

(Public Law 106-79) eliminated the requirements for a DoD contractor to submit a subcontracting plan before it may participate in the Indian Incentive Program.

DoD implements the Indian Incentive Program through use of the clause at Federal Acquisition Regulation (FAR) 52.226-1, Utilization of Indian Organizations and Indian-Owned Economic Enterprises. The FAR and DFARS previously prescribed use of the clause in only those DoD

contracts that contain subcontracting plan requirements. On October 26, 1999, a proposed FAR rule was published at 64 FR 57964 to remove the FAR requirements for DoD use of the clause; these DFARS amendments replace the FAR requirements.

DoD published a proposed rule at 64 FR 63003 on November 18, 1999. Thirty-six sources submitted comments on the proposed rule. DoD considered all comments in the development of the final rule. The final rule differs from the proposed rule in that it lowers the dollar threshold for us of the clause at FAR 52.226-1, to provide increased opportunity or small business concerns to participate in the Indian Incentive Program.

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

B. Regulatory Flexibility Act

DoD expects this final 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. A final regulatory

flexibility analysis has been prepared and its summarized as follows: The legal basis for the rule is Section 504 of the Indian Financing Act of 1974 (25 U.S.C. 1544); Section 8024 of the DoD Appropriations Act for Fiscal Year 1999 (Public Law 105-262); and Section 8024 of the

DoD Appropriations Act for Fiscal Year 2000 (Public Law 106-79). This rule will apply to all DoD contractors that have the clause at FAR 52.226-1, Utilization of Indian Organizations and Indian-Owned Economic Enterprises, incorporated into their contracts. The proposed rule required use of the clause at FAR 52.226-1 in construction contracts valued at $1,000,000 or more, and in other than construction contracts valued at $500,000 or more, except those awarded using FAR Part 12 (Commercial Item) procedures. As a result of public comments received, and to provide increased opportunity for small business concerns to participate in the Indian Incentive Program, the final rule lowers the dollars threshold for use of the clause to the simplified acquisition threshold ($100,000), for all contracts except those awarded using FAR Part 12 procedures. The rule does not impose any new reporting, recordkeeping, or other compliance requirements, and does not duplicate, overlap, or conflict with any other Federal rules. The rule is expected to have a beneficial effect on small business concerns, because small businesses are now eligible to receive incentive payments for the use of Indian organizations and Indian-owned economic enterprises as subcontractors.

C. Paperwork Reduction Act

The Paperwork Reduction Act does not apply because the rule does not impors 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 226

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

Therefore, 48 CFR part 226 is amended as follows:

Utilization of Indian Organizations and Indian-Owned Economic Enterprises

DFARS Case 99-D300 Final Rule

PART 226-OTHER SOCIOECONOMIC PROGRAMS

SUBPART 226.1-INDIAN INCENTIVE PROGRAM

226.103 Procedures.

226.104 Contract clause.

[Use the following prescription instead of the prescription at FAR 26.104(a):

(a) Use the clause at FAR 52.226-1, Utilization of Indian Organizations and Indian-Owned Economic Enterprises, in solicitations and contracts that-

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

DEPARTMENT OF DEFENSE

48 CFR Part 252

[DFARS Case 2000-D006]

Defense Federal Acquisition Regulation Supplement; Caribbean Basin Countries

AGENCY: Department of Defense (DoD).

ACTION: Final rule.

SUMMARY: The Acting Director of Defense Procurement has issued a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to implement the determination of the United States Trade Representative (USTR) to renew the treatment of Caribbean Basin Country

end products a eligible products under the Trade Agreements Act, except for end products from the Dominican Republic and Honduras.

EFFECTIVE DATE: April 13, 2000.

FOR FURTHER INFORMATION CONTACT: Ms. Amy Williams, Defense Acquisition

Regulations Council, PDUSD (AT&L) DP (DAR), IMD 3D139, 3062 Defense Pentagon, Washington, DC 20301-3062. Telephone (703) 602-0288; telefax (703) 602-0350. Please cite DFARS Case 2000-D006.

SUPPLEMENTARY INFORMATION:

A. Background

The USTR published a notice of 65 FR 9038 on February 23, 2000, to renew the treatment of Caribbean Basin Country end products as eligible products under the Trade Agreements Act, except for end products from the Dominican Republic and Honduras. The clauses at DFARS 252.225-7007,

Buy American Act--Trade Agreements--Balance of Payments Program, and 252.225-7021, Trade Agreements, list the Caribbean Basin countries whose products are eligible products under the Trade Agreements Act. This final rule amends the clauses to remove the Dominican Republic and

Honduras from the list, in accordance with the USTR determination. 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 subpart in accordance with 5 U.S.C. 610. Such comments should cite DFARS Case 2000-D006.

C. Paperwork Reduction Act

The Paperwork Reduction Act does not apply because the 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 252

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

Therefore, 48 CFR part 252 is amended as follows:

Caribbean Basin Countries

DFARS Case 2000-D006

Final Rule

PART 252-SOLICITATION PROVISIONS AND CONTRACT CLAUSES

* * * * *

252.225-7007 Buy American Act--Trade Agreements--Balance of Payments Program.

As prescribed in 225.408(a)(ii), use the following clause:

BUY AMERICAN ACT--TRADE AGREEMENTS--BALANCE OF
PAYMENTS PROGRAM (MAR 1998[APR 2000])

* * * * *

252.225-7021 Trade Agreements.

As prescribed in 225.408(a)(iv), use the following clause:

TRADE AGREEMENTS (MAR 1998[APR 2000])

* * * * *

From the Federal Register Online via GPO Access

DEPARTMENT OF DEFENSE

48 CFR Part 235

[DFARS Case 99-D302]

Defense Federal Acquisition Regulation Supplement; Manufacturing Technology Program

AGENCY: Department of Defense (DoD).

ACTION: Final rule.

SUMMARY: The Acting Director of Defense Procurement is adopting as final, without change, an interim rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to implement Section 216 of the National Defense Authorization Act for Fiscal Year 2000. Section

216 amends statutory provisions pertaining to cost-sharing requirements for contracts under the Manufacturing Technology Program.

EFFECTIVE DATE: April 13, 2000.

FOR FURTHER INFORMATION CONTACT: Ms. Susan L. Schneider, Defense Acquisition Regulations Council, PDUSD(AT&L)DP(DAR), IMD 3D139, 3062 Defense Pentagon, Washington, DC 20301-3062. Telephone (703) 602-0326; telefax (703) 602-0350. Please cite DFARS Case 99-D302.

SUPPLEMENTARY INFORMATION:

A. Background

DoD published an interim rule at 65 FR 2057 on January 13, 2000. (see DFARS Change Notice 20000113) The rule revised DFARS 235.006-70 to implement Section 216 of the National Defense Authorization Act for Fiscal Year 2000 (Public Law 106-65). Section 216 amended 10 U.S.C. 2525 to eliminate the mandatory cost-sharing requirements for contracts under the Manufacturing Technology Program, and to require that cost sharing be included as a factor in competitive procedures for evaluating proposals under anufacturing technology projects. DoD received no public comments on the interim rule by the date specified for receipt of comments. The interim rule is converted to a final rule without change.

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

B. Regulatory Flexibility Act

DoD certifies that this final rule will not 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 DoD awards approximately only 20 new contracts under the Manufacturing Technology Program each year.

C. Paperwork Reduction Act

The Paperwork Reduction Act does not apply because the 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 235

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

Interim Rule Adopted as Final Without Change

Accordingly, the interim rule amending 48 CFR Part 235, which was published at 65 FR 2057 on January 13, 2000, is adopted as a final rule without change.

1 Moved to 225.003.

2 Moved from 225.000-70 (U.S.-made end products deleted because now defined at FAR 25.003) and 225.401.

3 Moved to 225.103(c).

4 Moved from 225.102(a)(2).

5 Moved from 225.108.

6 Moved to 225.5.

7 Moved to 225.104.

8 Moved to 225.11, except 225.109(b) and 225.109-70(b) (now 225.171).

9 Moved to 225.11,

10 Moved to 225.003.

11 Moved from 225.403.

12 Moved to 225.401.

13 Moved to 225.11.

14 Moved from 225.105

15 Moved to Subpart 225.9, except clause prescriptions moved to 225.11, and 225.605 deleted (see next footnote).

16 225.605 is now in the FAR at 25.1101(e)(2).

17 Moved from Subpart 225.6.

18 Moved to 225.11.

19 Clause prescriptions moved from 225.109, 225.305, 225.408, 225.605, 225.971, and 225.972.