74990 Federal Register / Vol. 69, No. 240 / Wednesday, December 15, 2004 / Rules and Regulations 

■ 1. The authority citation for 48 CFR 

Parts 203, 209, and 252 continues to read 

as follows:

Authority: 41 U.S.C. 421 and 48 CFR 

Chapter 1.

PART 203—IMPROPER BUSINESS 

PRACTICES AND PERSONAL 

CONFLICTS OF INTEREST

■ 2. Section 203.070 is added to read as 

follows:

§ 203.070 Reporting of violations and 

suspected violations. 

Report violations and suspected 

violations of the following requirements 

in accordance with 209.406–3 or 

209.407–3 and DoDD 7050.5, 

Coordination of Remedies for Fraud and 

Corruption Related to Procurement 

Activities: 

(a) Certificate of Independent Price 

Determination (FAR 3.103). 

(b) Procurement integrity (FAR 3.104). 

(c) Gratuities clause (FAR 3.203). 

(d) Antitrust laws (FAR 3.303). 

(e) Covenant Against Contingent Fees 

(FAR 3.405). 

(f) Anti-kickback Act (FAR 3.502). 

(g) Prohibitions on persons convicted 

of defense-related contract felonies 

(203.570).

§ 203.103, 203.103–2, and 203.104–10 

[Removed]

■ 3. Sections 203.103, 203.103–2, and 

203.104–10 are removed.

Subparts 203.2 through 203.4 

[Removed]

■ 4. Subparts 203.2 through 203.4 are 

removed.

§ 203.502 [Removed]

■ 5. Section 203.502 is removed.

■ 6. Section 203.502–2 is amended by 

revising the heading to read as follows:

§ 203.502–2 Subcontractor kickbacks.

* * * * *

■ 7. Sections 203.570–1 and 203.570–2 

are revised to read as follows:

§ 203.570–1 Scope. 

This subpart implements 10 U.S.C. 

2408.

§ 203.570–2 Prohibition period. 

DoD has sole responsibility for 

determining the period of the 

prohibition described in paragraph (b) 

of the clause at 252.203–7001, 

Prohibition on Persons Convicted of 

Fraud or Other Defense-ContractRelated Felonies. The prohibition 

period—

(a) Shall not be less than 5 years from 

the date of conviction unless the agency 

head or a designee grants a waiver in the 

interest of national security. Follow the 

waiver procedures at PGI 203.570–2(a); 

and 

(b) May be more than 5 years from the 

date of conviction if the agency head or 

a designee makes a written 

determination of the need for the longer 

period. The agency shall provide a copy 

of the determination to the address at 

PGI 203.570–2(b).

§ 203.570–3 and 203.570–4 [Removed]

■ 8. Sections 203.570–3 and 203.570–4 

are removed.

§ 203.570–5 [Redesignated as 203.570–3]

■ 9. Section 203.570–5 is redesignated as 

section 203.570–3.

PART 209—CONTRACTOR 

QUALIFICATIONS

■ 10. Section 209.105–2 is revised to 

read as follows:

§ 209.105–2 Determinations and 

documentation. 

(a) For guidance on submission of 

determinations to the appropriate 

debarring and suspending official, see 

PGI 209.105–2(a).

■ 11. Section 209.406–3 is revised to 

read as follows:

§ 209.406–3 Procedures. 

Refer all matters appropriate for 

consideration by an agency debarring 

and suspending official as soon as 

practicable to the appropriate debarring 

and suspending official identified in 

209.403. Any person may refer a matter 

to the debarring and suspending official. 

Follow the procedures at PGI 209.406–

3.

■ 12. Section 209.407–3 is revised to 

read as follows:

§ 209.407–3 Procedures. 

Refer all matters appropriate for 

consideration by an agency debarring 

and suspending official as soon as 

practicable to the appropriate debarring 

and suspending official identified in 

209.403. Any person may refer a matter 

to the debarring and suspending official. 

Follow the procedures at PGI 209.407–

3.

PART 252—SOLICITATION 

PROVISIONS AND CONTRACT 

CLAUSES

■ 13. Section 252.203–7001 is amended 

by revising the introductory text, clause 

date, paragraph (b), paragraph (d) 

introductory text, and paragraph (h) to 

read as follows:

§ 252.203–7001 Prohibition on persons 

convicted of fraud or other defensecontract-related felonies. 

As prescribed in 203.570–3, use the 

following clause:

Prohibition on Persons Convicted of Fraud 

or Other Defense-Contract-Related Felonies 

(Dec 2004)

* * * * *

(b) Any individual who is convicted after 

September 29, 1988, of fraud or any other 

felony arising out of a contract with the DoD 

is prohibited from serving—

(1) In a management or supervisory 

capacity on this contract; 

(2) On the board of directors of the 

Contractor; 

(3) As a consultant, agent, or representative 

for the Contractor; or 

(4) In any other capacity with the authority 

to influence, advise, or control the decisions 

of the Contractor with regard to this contract.

* * * * *

(d) 10 U.S.C. 2408 provides that the 

Contractor shall be subject to a criminal 

penalty of not more than $500,000 if 

convicted of knowingly—

* * * * *

(h) Pursuant to 10 U.S.C. 2408(c), defense 

contractors and subcontractors may obtain 

information as to whether a particular person 

has been convicted of fraud or any other 

felony arising out of a contract with the DoD 

by contacting The Office of Justice Programs, 

The Denial of Federal Benefits Office, U.S. 

Department of Justice, telephone (301) 809–

4904. 

(End of clause)

[FR Doc. 04–27348 Filed 12–14–04; 8:45 am] 

BILLING CODE 5001–08–P

DEPARTMENT OF DEFENSE

48 CFR Part 206 

[DFARS Case 2003–D017] 

Defense Federal Acquisition 

Regulation Supplement; Competition 

Requirements

AGENCY: Department of Defense (DoD).

ACTION: Final rule.

SUMMARY: DoD has issued a final rule 

amending the Defense Federal 

Acquisition Regulation Supplement 

(DFARS) to update text pertaining to 

competition requirements. This rule is a 

result of a transformation initiative 

undertaken by DoD to dramatically 

change the purpose and content of the 

DFARS.

EFFECTIVE DATE: December 15, 2004.

FOR FURTHER INFORMATION CONTACT: Ms. 

Robin Schulze, Defense Acquisition 

Regulations Council, 

OUSD(AT&L)DPAP(DAR), IMD 3C132, 

3062 Defense Pentagon, Washington, DC 

20301–3062. Telephone (703) 602–0326; 

Federal Register / Vol. 69, No. 240 / Wednesday, December 15, 2004 / Rules and Regulations 74991

facsimile (703) 602–0350. Please cite 

DFARS Case 2003–D017.

SUPPLEMENTARY INFORMATION:

A. Background 

DFARS Transformation is a major 

DoD initiative to dramatically change 

the purpose and content of the DFARS. 

The objective is to improve the 

efficiency and effectiveness of the 

acquisition process, while allowing the 

acquisition workforce the flexibility to 

innovate. The transformed DFARS will 

contain only requirements of law, DoDwide policies, delegations of FAR 

authorities, deviations from FAR 

requirements, and policies/procedures 

that have a significant effect beyond the 

internal operating procedures of DoD or 

a significant cost or administrative 

impact on contractors or offerors. 

Additional information on the DFARS 

Transformation initiative is available at 

http://www.acq.osd.mil/dpap/dfars/

transf.htm.

This final rule is a result of the 

DFARS Transformation initiative. The 

DFARS changes include—

Æ Revision of DFARS 206.001 to 

clarify the text. 

Æ Deletion of text at DFARS 

206.202(b) regarding documentation 

needed to support a DoD determination 

to exclude a particular source from a 

contact action in order to establish or 

maintain an alternative source of 

supplies or services; and deletion of text 

at DFARS 206.302–2 containing 

examples of circumstances under which 

use of other than full and open 

competition may be appropriate due to 

unusual and compelling urgency. This 

text has been relocated to the new 

DFARS companion resource, 

Procedures, Guidance, and Information 

(PGI), available at http://

www.acq.osd.mil/dpap/dars/pgi.

Æ Deletion of obsolete text at DFARS 

206.302–1(b)(4) and deletion of 

unnecessary text at DFARS 206.303–1(b) 

and (c) and 206.303–2.

DoD published a proposed rule at 69 

FR 8149 on February 23, 2004. DoD 

received one comment on the proposed 

rule. The respondent recommended 

further revision of the text at 206.001 to 

clarify that the exception from 

competition authorized by 10 U.S.C. 

1091 applies only to contracts awarded 

to individuals. DoD has included this 

clarification in the final rule. 

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 the DFARS changes in this rule 

are limited to clarifying revisions or 

deletion of text that is unnecessary or 

internal to DoD. 

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 206 

Government procurement.

Michele P. Peterson, 

Executive Editor, Defense Acquisition 

Regulations Council.

■ Therefore, 48 CFR Part 206 is amended 

as follows:

■ 1. The authority citation for 48 CFR 

Part 206 continues to read as follows:

Authority: 41 U.S.C. 421 and 48 CFR 

Chapter 1.

PART 206—COMPETITION 

REQUIREMENTS

■ 2. Section 206.001 is revised to read as 

follows:

206.001 Applicability. 

(b) As authorized by 10 U.S.C. 1091, 

contracts awarded to individuals using 

the procedures at 237.104(b)(ii) are 

exempt from the competition 

requirements of FAR Part 6.

■ 3. Section 206.202 is revised to read as 

follows:

206.202 Establishing or maintaining 

alternative sources. 

(a) Agencies may use this authority to 

totally or partially exclude a particular 

source from a contract action. 

(b) The determination and findings 

(D&F) and the documentation 

supporting the D&F shall identify the 

source to be excluded from the contract 

action. Include the information at PGI 

206.202(b), as applicable, and any other 

information that may be pertinent, in 

the supporting documentation.

206.302–1 [Amended]

■ 4. Section 206.302–1 is amended by 

removing paragraph (b)(4).

■ 5. Section 206.302–2 is revised to read 

as follows:

206.302–2 Unusual and compelling 

urgency. 

(b) Application. For guidance on 

circumstances under which use of this 

authority may be appropriate, see PGI 

206.302–2(b).

206.303–1 [Amended]

■ 6. Section 206.303–1 is amended by 

removing paragraphs (b) and (c).

206.303–2 [Removed]

■ 7. Section 206.303–2 is removed.

[FR Doc. 04–27349 Filed 12–14–04; 8:45 am] 

BILLING CODE 5001–08–P

DEPARTMENT OF DEFENSE

48 CFR Parts 212, 213, 225, and 252

[DFARS Case 2003–D088] 

Defense Federal Acquisition 

Regulation Supplement; Free Trade 

Agreements—Chile and Singapore

AGENCY: Department of Defense (DoD).

ACTION: Final rule.

SUMMARY: DoD has adopted as final, 

with changes, an interim rule amending 

the Defense Federal Acquisition 

Regulation Supplement (DFARS) to 

implement new Free Trade Agreements 

with Chile and Singapore, as approved 

by Congress in the United States-Chile 

Free Trade Agreement Implementation 

Act and the United States-Singapore 

Free Trade Agreement Implementation 

Act. The new Free Trade Agreements 

waive the applicability of the Buy 

American Act for some foreign supplies 

and construction materials from Chile 

and Singapore, and specify procurement 

procedures designed to ensure fairness.

EFFECTIVE DATE: December 15, 2004.

FOR FURTHER INFORMATION CONTACT: Ms. 

Amy Williams, Defense Acquisition 

Regulations Council, 

OUSD(AT&L)DPAP(DAR), IMD 3C132, 

3062 Defense Pentagon, Washington, DC 

20301–3062; telephone (703) 602–0328; 

facsimile (703) 602–0350. Please cite 

DFARS Case 2003–D088.

SUPPLEMENTARY INFORMATION: 

A. Background 

DoD published an interim DFARS 

rule at 69 FR 1926 on January 13, 2004, 

to implement new Free Trade 

Agreements with Chile and Singapore, 

in accordance with the United StatesChile Free Trade Agreement 

Implementation Act (Public Law 108–

77) and the United States-Singapore 

Free Trade Agreement Implementation 

Act (Public Law 108–78). Applicable 

changes to the Federal Acquisition 

Regulation (FAR) were published in 

Federal Acquisition Circular (FAC) 

2001–19 on January 7, 2004 (69 FR 

1051; Interim rule), and in FAC 2001–

25 on October 5, 2004 (69 FR 59700; 

Final rule).