17448 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

(b) Use the basic or the alternate of the 

clause at 252.235–7003, Frequency 

Authorization, in solicitations and 

contracts for developing, producing, 

constructing, testing, or operating a 

device requiring a frequency 

authorization. 

(1) Use the basic clause if agency 

procedures do not authorize the use of 

DD Form 1494, Application for 

Equipment Frequency Allocation, to 

obtain radio frequency authorization. 

(2) Use the alternate I clause if agency 

procedures authorize the use of DD 

Form 1494, Application for Equipment 

Frequency Allocation, to obtain 

frequency authorization. 

* * * * * 

PART 252—SOLICITATION 

PROVISIONS AND CONTRACT 

CLAUSES 

■ 3. Amend section 252.235–7003 by— 

■ a. Revising the introductory text, 

clause title and date; and 

■ b. Revising Alternate I. 

252.235–7003 Frequency authorization. 

As prescribed in 235.072(b), use one 

of the following clauses: 

Basic. As prescribed at 235.072(b)(1), 

use the following clause. 

FREQUENCY AUTHORIZATION—BASIC 

(MAR 2014) 

* * * * * 

Alternate I. As prescribed at 235.072(b)(2), 

use the following clause, which uses a 

different paragraph (c) than the basic clause. 

FREQUENCY AUTHORIZATION— 

ALTERNATE I (MAR 2014) 

(a) The Contractor shall obtain 

authorization for radio frequencies required 

in support of this contract. 

(b) For any experimental, developmental, 

or operational equipment for which the 

appropriate frequency allocation has not 

been made, the Contractor shall provide the 

technical operating characteristics of the 

proposed electromagnetic radiating device to 

the Contracting Officer during the initial 

planning, experimental, or developmental 

phase of contract performance. 

(c) The Contractor shall use DD Form 1494, 

Application for Equipment Frequency 

Allocation, to obtain radio frequency 

authorization. 

(d) The Contractor shall include this 

clause, including this paragraph (d), in all 

subcontracts requiring the development, 

production, construction, testing, or 

operation of a device for which a radio 

frequency authorization is required. 

(End of clause) 

[FR Doc. 2014–06736 Filed 3–27–14; 8:45 am] 

BILLING CODE 5001–06–P 

DEPARTMENT OF DEFENSE 

Defense Acquisition Regulations 

System 

48 CFR Parts 246 and 252 

RIN 0750–AH95 

Defense Federal Acquisition 

Regulation Supplement: Clauses With 

Alternates—Quality Assurance 

(DFARS Case 2013–D004) 

AGENCY: Defense Acquisition 

Regulations System, Department of 

Defense (DoD). 

ACTION: Final rule. 

SUMMARY: DoD is issuing a final rule 

amending the Defense Federal 

Acquisition Regulation Supplement 

(DFARS) to create an overarching 

prescription for a quality assurancerelated clause with two alternates. The 

rule also includes separate prescriptions 

for the basic and alternate clauses and 

includes the full text of each alternate. 

DATES: Effective March 28, 2014. 

FOR FURTHER INFORMATION CONTACT: Ms. 

Annette Gray, telephone 571–372–6093. 

SUPPLEMENTARY INFORMATION: 

I. Background 

DoD published a proposed rule in the 

Federal Register at 78 FR 48407 on 

August 8, 2013, to revise the 

presentation of the DFARS part 246 

clause with alternates and their 

prescriptions. 

II. Discussion 

This final rule addresses the single 

DFARS part 246 clause that has 

alternates. The affected clause is 

252.246–7001, Warranty of Data, with 

two alternates. The naming convention 

results in new clause titles: Warranty of 

Data—Basic, Warranty of Data— 

Alternate I, and Warranty of Data— 

Alternate II. 

No public comments were submitted 

in response to the proposed rule. Minor 

editorial changes were made in the final 

rule to standardize language used for the 

clause prescriptions and prefaces to 

provide uniform arrangement in the 

regulations. 

III. 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, dated September 30, 1993. This 

rule is not a major rule under 5 U.S.C. 

804. 

IV. Regulatory Flexibility Act 

A final regulatory flexibility analysis 

has been prepared consistent with the 

Regulatory Flexibility Act, 5 U.S.C. 601, 

et seq., and is summarized as follows. 

This final rule amends the Defense 

Federal Acquisition Regulation 

Supplement (DFARS) to (1) create an 

umbrella prescription for the elements 

common to the basic clause and both 

alternates, (2) create a specific 

prescription for the basic clause and 

each alternate clause that address only 

the requirements for their use of the 

alternate so that it is clear which is 

appropriate in a specific procurement, 

and (3) include the full text of the clause 

alternate. The inclusion of the full text 

of the alternate clause makes the terms 

clearer to offerors, and contractors, as 

well as to DoD contracting officers. The 

prescriptions are not revised in any way 

to change when the clause is applicable 

to offerors, contractors, or 

subcontractors. 

No comments were received from the 

public in response to the initial 

regulatory flexibility analysis. The Chief 

Counsel for Advocacy of the Small 

Business Administration did not submit 

any comments in response to the rule. 

Potential offerors, including small 

businesses, may be affected by this rule 

by seeing an unfamiliar format for 

clause alternates in solicitations and 

contracts issued by DoD contracting 

activities. According to the Federal 

Procurement Data System, in Fiscal 

Year 2012, DoD made approximately 

270,000 contract awards (not including 

modification and orders) that exceeded 

the micro-purchase threshold, of which 

approximately 180,000 (67%) were 

awarded to small businesses. It is 

unknown how many of these contracts 

were awarded that included an alternate 

to a DFARS provision or clause. Nothing 

substantive will change in solicitations 

or contracts for potential offerors, and 

only the appearance of how clause 

alternates are presented in the 

solicitations and contracts will be 

changed. This rule may result in 

potential offerors, including small 

businesses, expending more time to 

become familiar with and to understand 

the new format of the clause alternates 

in full text contained in contracts issued 


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Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 17449 

by any DoD contracting activity. The 

rule also anticipates saving contractors 

time by making all paragraph 

substitutions from the basic version of 

the clause, and not requiring the 

contractors to read inapplicable 

paragraphs contained in the basic 

version of the clause where alternates 

are also included in the solicitations 

and contracts. The overall burden 

caused by this rule is expected to be 

negligible and will not be any greater on 

small businesses than it is on large 

businesses. 

This rule does not add any new 

information collection requirements. No 

alternatives were identified that will 

accomplish the objectives of the rule. 

This rule should not result in any 

significant economic impact on small 

entities. 

V. Paperwork Reduction Act 

The 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 246 and 

252 

Government procurement. 

Manuel Quinones, 

Editor, Defense Acquisition Regulations 

System. 

Therefore, 48 CFR parts 246 and 252 

are amended as follows: 

■ 1. The authority citation for 48 CFR 

parts 246 and 252 continues to read as 

follows: 

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

chapter 1. 

PART 246—QUALITY ASSURANCE 

■ 2. Amend section 246.710 by— 

■ a. Removing paragraphs (2) and (3); 

■ b. Redesignating paragraphs (4) and 

(5) as paragraphs (2) and (3), 

respectively; and 

■ c. Revising paragraph (1) to read as 

follows: 

246.710 Contract clauses. 

(1) Use a clause substantially the same 

as the basic or one of the alternates of 

the clause at 252.246–7001, Warranty of 

Data, in solicitations and contracts that 

include the clause at 252.227–7013, 

Rights in Technical Data and Computer 

Software, when there is a need for 

greater protection or period of liability 

than provided by the inspection and 

warranty clauses prescribed in FAR part 

46. 

(i) Use the basic clause in solicitations 

and contracts that are not firm-fixed 

price or fixed-price incentive. 

(ii) Use alternate in fixed-priceincentive solicitations and contracts. 

(iii) Use alternate II in firm-fixed-price 

solicitations and contracts. 

* * * * * 

PART 252—SOLICITATION 

PROVISIONS AND CONTRACT 

CLAUSES 

■ 3. Amend section 252.246–7001 by— 

■ a. Revising the introductory text, 

clause title and date; and 

■ b. Revising Alternate I and Alternate 

II. 

Revised text reads as follows: 

252.246–7001 Warranty of data. 

As prescribed in 246.710(1), use one 

of the following clauses: 

Basic. As prescribed at 246.710(1)(i), 

use the following clause. 

WARRANTY OF DATA—BASIC (MAR 

2014) 

* * * * * 

Alternate I. As prescribed in 246.710(1)(ii), 

use the following clause, which uses a 

different paragraph (d)(3) than the basic 

clause. 

WARRANTY OF DATA—ALTERNATE I 

(MAR 2014) 

(a) Definition. Technical data has the same 

meaning as given in the clause in this 

contract entitled ‘‘Rights in Technical Data 

and Computer Software.’’ 

(b) Warranty. Notwithstanding inspection 

and acceptance by the Government of 

technical data furnished under this contract, 

and notwithstanding any provision of this 

contract concerning the conclusiveness of 

acceptance, the Contractor warrants that all 

technical data delivered under this contract 

will at the time of delivery conform with the 

specifications and all other requirements of 

this contract. The warranty period shall 

extend for three years after completion of the 

delivery of the line item of data (as identified 

in DD Form 1423, Contract Data 

Requirements List) of which the data forms 

a part; or any longer period specified in the 

contract. 

(c) Contractor Notification. The Contractor 

agrees to notify the Contracting Officer in 

writing immediately of any breach of the 

above warranty which the Contractor 

discovers within the warranty period. 

(d) Remedies. The following remedies shall 

apply to all breaches of the warranty, 

whether the Contractor notifies the 

Contracting Officer in accordance with 

paragraph (c) of this clause or if the 

Government notifies the Contractor of the 

breach in writing within the warranty period: 

(1) Within a reasonable time after such 

notification, the Contracting Officer may— 

(i) By written notice, direct the Contractor 

to correct or replace at the Contractor’s 

expense the nonconforming technical data 

promptly; or 

(ii) If the Contracting Officer determines 

that the Government no longer has a 

requirement for correction or replacement of 

the data, or that the data can be more 

reasonably corrected by the Government, 

inform the Contractor by written notice that 

the Government elects a price or fee 

adjustment instead of correction or 

replacement. 

(2) If the Contractor refuses or fails to 

comply with a direction under paragraph 

(d)(1)(i) of this clause, the Contracting Officer 

may, within a reasonable time of the refusal 

or failure— 

(i) By contract or otherwise, correct or 

replace the nonconforming technical data 

and charge the cost to the Contractor; or 

(ii) Elect a price or fee adjustment instead 

of correction or replacement.] 

(3) In addition to the remedies under 

paragraphs (d)(1) and (2) of this clause, the 

Contractor shall be liable to the Government 

for all damages to the Government as a result 

of the breach of warranty. 

(i) The additional liability under paragraph 

(d)(3) of this clause shall not exceed 75 

percent of the target profit. 

(ii) If the breach of the warranty is with 

respect to the data supplied by an equipment 

subcontractor, the limit of the Contractor’s 

liability shall be— 

(A) Ten percent of the total subcontract 

price in a firm-fixed-price subcontract; 

(B) Seventy-five percent of the total 

subcontract fee in a cost-plus-fixed-fee or 

cost-plus-award-fee subcontract; or 

(C) Seventy-five percent of the total 

subcontract target profit or fee in a fixedprice-incentive or cost-plus-incentive 

subcontract. 

(iii) Damages due the Government under 

the provisions of this warranty are not an 

allowable cost. 

(iv) The additional liability in paragraph 

(d)(3) of this clause shall not apply— 

(A) With respect to the requirements for 

product drawings and associated lists, 

special inspection equipment (SIE) drawings 

and associated lists, special tooling drawings 

and associated lists, SIE operating 

instructions, SIE descriptive documentation, 

and SIE calibration procedures under MIL– 

T–31000, General Specification for Technical 

Data Packages, Amendment 1, or MIL–T– 

47500, General Specification for Technical 

Data Packages, Supp 1, or drawings and 

associated lists under level 2 or level 3 of 

MIL–D–1000A, Engineering and Associated 

Data Drawings, or DoD–D–1000B, 

Engineering and Associated Lists Drawings 

(Inactive for New Design) Amendment 4, 

Notice 1; or drawings and associated lists 

under category E or I of MIL–D–1000, 

Engineering and Associated Lists Drawings, 

provided that the data furnished by the 

Contractor was current, accurate at time of 

submission, and did not involve a significant 

omission of data necessary to comply with 

the requirements; or 

(B) To defects the Contractor discovers and 

gives written notice to the Government before 

the Government discovers the error. 

(e) The provisions of this clause apply 

anew to that portion of any corrected or 

replaced technical data furnished to the 

Government under paragraph (d)(1)(i) of this 

clause. 

(End of clause) 


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17450 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

Alternate II. As prescribed at 

246.710(1)(iii), use the following clause, 

which uses a different paragraph (d)(3) 

than the basic clause. 

WARRANTY OF DATA—ALTERNATE II 

(MAR 2014) 

(a) Definition. Technical data has the same 

meaning as given in the clause in this 

contract entitled ‘‘Rights in Technical Data 

and Computer Software.’’ 

(b) Warranty. Notwithstanding inspection 

and acceptance by the Government of 

technical data furnished under this contract, 

and notwithstanding any provision of this 

contract concerning the conclusiveness of 

acceptance, the Contractor warrants that all 

technical data delivered under this contract 

will at the time of delivery conform with the 

specifications and all other requirements of 

this contract. The warranty period shall 

extend for three years after completion of the 

delivery of the line item of data (as identified 

in DD Form 1423, Contract Data 

Requirements List) of which the data forms 

a part; or any longer period specified in the 

contract. 

(c) Contractor Notification. The Contractor 

agrees to notify the Contracting Officer in 

writing immediately of any breach of the 

above warranty which the Contractor 

discovers within the warranty period. 

(d) Remedies. The following remedies shall 

apply to all breaches of the warranty, 

whether the Contractor notifies the 

Contracting Officer in accordance with 

paragraph (c) of this clause or if the 

Government notifies the Contractor of the 

breach in writing within the warranty period: 

(1) Within a reasonable time after such 

notification, the Contracting Officer may— 

(i) By written notice, direct the Contractor 

to correct or replace at the Contractor’s 

expense the nonconforming technical data 

promptly; or 

(ii) If the Contracting Officer determines 

that the Government no longer has a 

requirement for correction or replacement of 

the data, or that the data can be more 

reasonably corrected by the Government, 

inform the Contractor by written notice that 

the Government elects a price or fee 

adjustment instead of correction or 

replacement. 

(2) If the Contractor refuses or fails to 

comply with a direction under paragraph 

(d)(1)(i) of this clause, the Contracting Officer 

may, within a reasonable time of the refusal 

or failure— 

(i) By contract or otherwise, correct or 

replace the nonconforming technical data 

and charge the cost to the Contractor; or 

(ii) Elect a price or fee adjustment instead 

of correction or replacement. 

(3) In addition to the remedies under 

paragraphs (d)(1) and (2) of this clause, the 

Contractor shall be liable to the Government 

for all damages to the Government as a result 

of the breach of the warranty. 

(i) The additional liability under paragraph 

(d)(3) of this clause shall not exceed ten 

percent of the total contract price. 

(ii) If the breach of the warranty is with 

respect to the data supplied by an equipment 

subcontractor, the limit of the Contractor’s 

liability shall be— 

(A) Ten percent of the total subcontract 

price in a firm[-]fixed[-]price subcontract; 

(B) Seventy-five percent of the total 

subcontract fee in a cost-plus-fixed-fee or 

cost-plus-award-fee subcontract; or 

(C) Seventy-five percent of the total 

subcontract target profit or fee in a fixedprice-incentive or cost-plus-incentive 

subcontract. 

(iii) The additional liability specified in 

paragraph (d)(3) of this clause shall not 

apply— 

(A) With respect to the requirements for 

product drawings and associated lists, 

special inspection equipment (SIE) drawings 

and associated lists, special tooling drawings 

and associated lists, SIE operating 

instructions, SIE descriptive documentation, 

and SIE calibration procedures under MIL– 

T–31000, General Specification for Technical 

Data Packages, Amendment 1, or MIL–T– 

47500, General Specification for Technical 

Data Packages, Supp 1, or drawings and 

associated lists under level 2 or level 3 of 

MIL–D–1000A, Engineering and Associated 

Data Drawings, or DoD–D–1000B, 

Engineering and Associated Lists Drawings 

(Inactive for New Design) Amendment 4, 

Notice 1; or drawings and associated lists 

under category E or I of MIL–D–1000, 

Engineering and Associated Lists Drawings, 

provided that the data furnished by the 

Contractor was current, accurate at time of 

submission, and did not involve a significant 

omission of data necessary to comply with 

the requirements; or 

(B) To defects the Contractor discovers and 

gives written notice to the Government before 

the Government discovers the error. 

(e) The provisions of this clause apply 

anew to that portion of any corrected or 

replaced technical data furnished to the 

Government under paragraph (d)(1)(i) of this 

clause. 

(End of clause) 

252.246–7002 [Amended] 

■ 4. Amend section 252.246–7002 

introductory text by removing 

‘‘246.710(4)’’ and adding ‘‘246.710(2)’’ 

in its place. 

252.246–7005 [Amended] 

■ 5. Amend section 252.246–7005 

introductory text by removing 

‘‘246.710(5)(i)(A)’’ and adding 

‘‘246.710(3)(i)(A)’’ in its place. 

252.246–7006 [Amended] 

■ 6. Amend section 252.246–7006 

introductory text by removing 

‘‘246.710(5)(i)(B)’’ and adding 

‘‘246.710(3)(i)(B)’’ in its place. 

[FR Doc. 2014–06735 Filed 3–27–14; 8:45 am] 

BILLING CODE 5001–06–P 


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