Federal Register / Vol. 78, No. 189 / Monday, September 30, 2013 / Rules and Regulations 59859 

252.225–7022 [Removed and Reserved] 

■ 17. Section 252.225–7022 is removed 

and reserved. 

■ 18. Section 252.225–7023 is revised to 

read as follows: 

252.225–7023 Preference for Products or 

Services from Afghanistan. 

As prescribed in 225.7703-4(a), use 

the following provision: 

Preference for Products or Services 

From Afghanistan (SEP 2013) 

(a) Definitions. ‘‘Product from 

Afghanistan’’ and ‘‘service from 

Afghanistan,’’ as used in this provision, are 

defined in the clause of this solicitation 

entitled ‘‘Requirement for Products or 

Services from Afghanistan’’ (DFARS 

252.225–7024). 

(b) Representation. The offeror represents 

that all products or services to be delivered 

under a contract resulting from this 

solicitation are products from Afghanistan or 

services from Afghanistan, except those 

listed in— 

(1) Paragraph (c) of this provision; or 

(2) Paragraph (c)(2) of the provision 

entitled ‘‘Trade Agreements Certificate,’’ if 

included in this solicitation. 

(c) Other products or services. The 

following offered products or services are not 

products from Afghanistan or services from 

Afghanistan: 

(Line Item Number) (Country of Origin) 

(d) Evaluation. For the purpose of 

evaluating competitive offers, the Contracting 

Officer will increase by 50 percent the prices 

of offers of products or services that are not 

products or services from Afghanistan. 

(End of provision) 

■ 19. Section 252.225–7024 is revised to 

read as follows: 

252.225–7024 Requirement for Products or 

Services from Afghanistan. 

As prescribed in 225.7703-4(b), use 

the following clause: 

Requirement for Products or Services 

From Afghanistan (SEP 2013) 

(a) Definitions. As used in this clause— 

(1) ‘‘Product from Afghanistan’’ means a 

product that is mined, produced, or 

manufactured in Afghanistan. 

(2) ‘‘Service from Afghanistan’’ means a 

service including construction that is 

performed in Afghanistan predominantly by 

citizens or permanent resident aliens of 

Afghanistan. 

(b) The Contractor shall provide only 

products from Afghanistan or services from 

Afghanistan under this contract, unless, in its 

offer, it specified that it would provide 

products or services other than products from 

Afghanistan or services from Afghanistan. 

(End of clause) 

■ 20. Section 252.225–7026 is revised to 

read as follows: 

252.225–7026 Acquisition Restricted to 

Products or Services from Afghanistan. 

As prescribed in 225.7703-4(c), use 

the following clause: 

Acquisition Restricted to Products or 

Services From Afghanistan (SEP 2013) 

(a) Definitions. As used in this clause— 

(1) ‘‘Product from Afghanistan’’ means a 

product that is mined, produced, or 

manufactured in Afghanistan. 

(2) ‘‘Service from Afghanistan’’ means a 

service including construction that is 

performed in Afghanistan predominantly by 

citizens or permanent resident aliens of 

Afghanistan. 

(b) The Contractor shall provide only 

products from Afghanistan or services from 

Afghanistan under this contract. 

(End of clause) 

■ 21. Section 252.225–7029 is added to 

read as follows: 

252.225–7029 Acquisition of Uniform 

Components for Afghan Military or Afghan 

National Police. 

As prescribed in 225.7703–4(d), use 

the following clause: 

Acquisition of Uniform Components for 

the Afghan Military or the Afghan 

National Police (SEP 2013) 

(a) Definitions. As used in this clause— 

‘‘Textile component’’ means any item 

consisting of fibers, yarns, or fabric, supplied 

for incorporation into a uniform or a 

component of a uniform. It does not include 

items that do not contain fibers, yarns, or 

fabric, such as the metallic or plastic 

elements of buttons, zippers, or other 

clothing fasteners. 

‘‘United States’’ means the 50 States, the 

District of Columbia, and outlying areas. 

(b) As required by section 826 of the 

National Defense Authorization Act for Fiscal 

Year 2013 (Pub. L. 112–239), the Contractor 

shall deliver under this contract only textile 

components that have been produced in the 

United States. 

(c) There are no exceptions or waivers to 

this requirement. 

(End of clause) 

252.225–7032 [Amended] 

■ 22. In section 252.225–7032, the 

introductory text is amended by 

removing ‘‘225.1101(8)’’ and adding in 

its place ‘‘225.1101(7)’’. 

252.225–7033 [Amended] 

■ 23. In section 252.225–7033, the 

introductory text is amended by 

removing ‘‘225.1101(9)’’ and adding in 

its place ‘‘225.1101(8)’’. 

252.225–7035 [Amended] 

■ 24. Section 252.225–7035 is amended 

by— 

■ a. Removing ‘‘225.1101(10)(i)’’ in the 

introductory text and adding in its place 

‘‘225.1101(9)(i)’’; 

■ b. In Alternate I, removing 

‘‘225.1101(10)(ii)’’ in the introductory 

text and adding in its place 

‘‘225.1101(9)(ii)’’; 

■ c. In Alternate II, removing 

‘‘225.1101(10)(iii)’’ in the introductory 

text and adding in its place 

‘‘225.1101(9)(iii)’’; 

■ d. In Alternate III, removing 

‘‘225.1101(10)(iv)’’ in the introductory 

text and adding in its place 

‘‘225.1101(9)(iv)’’; 

■ e. In Alternate IV, removing 

‘‘225.1101(10)(v)’’ in the introductory 

text and adding in its place 

‘‘225.1101(9)(v)’’; and 

■ f. In Alternate V, removing 

‘‘225.1101(10)(vi)’’ in the introductory 

text and adding in its place 

‘‘225.1101(9)(vi)’’. 

252.225–7036 [Amended] 

■ 25. Section 252.225–7036 is amended 

by— 

■ a. Removing ‘‘225.1101(11)(i)(A)’’ in 

the introductory text and adding in its 

place ‘‘225.1101(10)(i)(A)’’; 

■ b. In Alternate I, removing 

‘‘225.1101(11)(i)(B)’’ in the introductory 

text and adding in its place 

‘‘225.1101(10)(i)(B)’’; 

■ c. In Alternate II, removing 

‘‘225.1101(11)(i)(A)’’ in the introductory 

text and adding in its place 

‘‘225.1101(10)(i)(A)’’; 

■ d. In Alternate III, removing 

‘‘225.1101(11)(i)(B)’’ in the introductory 

text and adding in its place 

‘‘225.1101(10)(i)(B)’’; 

■ e. In Alternate IV, removing 

‘‘225.1101(11)(i)(C)’’ in the introductory 

text and adding in its place 

‘‘225.1101(10)(i)(C)’’; and 

■ f. In Alternate V, removing 

‘‘225.1101(11)(i)(C)’’ in the introductory 

text and adding in its place 

‘‘225.1101(10)(i)(C)’’. 

[FR Doc. 2013–23743 Filed 9–27–13; 8:45 am] 

BILLING CODE 5001–06–P 

DEPARTMENT OF DEFENSE 

Defense Acquisition Regulations 

System 

48 CFR Parts 216 and 252 

RIN 0750–AI04 

Defense Federal Acquisition 

Regulation Supplement: Allowability of 

Legal Costs for Whistleblower 

Proceedings (DFARS Case 2013–D022) 

AGENCY: Defense Acquisition 

Regulations System, Department of 

Defense (DoD). 

ACTION: Interim rule. 

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59860 Federal Register / Vol. 78, No. 189 / Monday, September 30, 2013 / Rules and Regulations 

SUMMARY: DoD is issuing an interim rule 

amending the Defense Federal 

Acquisition Regulation Supplement 

(DFARS) to implement a section of the 

National Defense Authorization Act for 

Fiscal Year 2013 that amends the 

allowability of legal costs incurred by a 

contractor related to whistleblower 

proceedings. 

DATES: Effective date: September 30, 

2013 

Comment date: Comments on the 

interim rule should be submitted in 

writing to the address shown below on 

or before November 29, 2013, to be 

considered in the formation of a final 

rule. 

ADDRESSES: Submit comments 

identified by DFARS Case 2013–D022, 

using any of the following methods: 

Æ Regulations.gov: http://

www.regulations.gov. Submit comments 

via the Federal eRulemaking portal by 

entering ‘‘DFARS Case 2013–D022’’ 

under the heading ‘‘Enter keyword or 

ID’’ and selecting ‘‘Search.’’ Select the 

link ‘‘Submit a Comment’’ that 

corresponds with ‘‘DFARS Case 2013– 

D022.’’ Follow the instructions provided 

at the ‘‘Submit a Comment’’ screen. 

Please include your name, company 

name (if any), and ‘‘DFARS Case 2013– 

D022’’ on your attached document. 

Æ Email: dfars@osd.mil. Include 

DFARS Case 2013–D022 in the subject 

line of the message. 

Æ Fax: 571–372–6094. 

Æ Mail: Defense Acquisition 

Regulations System, Attn: Ms. Amy 

Williams, OUSD (AT&L) DPAP/DARS, 

Room 3B855, 3060 Defense Pentagon, 

Washington, DC 20301–3060. 

Comments received generally will be 

posted without change to http://

www.regulations.gov, including any 

personal information provided. To 

confirm receipt of your comment(s), 

please check www.regulations.gov, 

approximately two to three days after 

submission to verify posting (except 

allow 30 days for posting of comments 

submitted by mail). 

FOR FURTHER INFORMATION CONTACT: Ms. 

Amy Williams, Defense Acquisition 

Regulations System, OUSD (AT&L) 

DPAP/DARS, Room 3B855, 3060 

Defense Pentagon, Washington, DC 

20301–3060. Telephone 571–372–6106; 

facsimile 571–372–6094. 

SUPPLEMENTARY INFORMATION: 

I. Background 

This interim rule revises DFARS 

subparts 216.3 and adds a new clause at 

252.216 to implement paragraphs (g) 

and (i) of section 827 of the National 

Defense Authorization Act for Fiscal 

Year 2013 (Pub. L. 112–239). 

II. Discussion and Analysis 

The National Defense Authorization 

Act (NDAA) for Fiscal Year 2013 (Pub. 

L. 112–239, enacted January 2, 2013) 

established enhanced whistleblower 

protections for contractor and 

subcontractor employees in separate, 

but parallel, sections of the NDAA for 

titles 10 and 41 agencies, respectively. 

Title 10 agencies are required by the 

terms of section 827(i)(2) to revise their 

respective FAR supplements. These 

enhanced whistleblower protections 

and the associated cost principle 

changes are being implemented by two 

DFARS cases (for DoD only) and two 

FAR cases (for title 41 agencies), which 

are independent, but parallel, 

rulemakings because of some minor 

differences in the operations of the 

underlying statutes and because the title 

41 statute is only a four-year pilot 

program. 

Paragraph 827(g) addresses the 

allowability of legal costs incurred by a 

contractor related to whistleblower 

proceedings. 

Paragraph 827(i)(1) specifies that the 

amendments made by section 827 are 

applicable to— 

• Contracts awarded on or after the 

effective date; 

• Task orders entered into on or after 

the effective date, pursuant to contracts 

awarded before, on, or after such date; 

and 

• Contracts awarded before the 

effective date, which are modified to 

include a contract clause providing for 

the applicability of such amendments. 

Paragraph 827(i)(3) requires that at the 

time of any major modification to a 

contract that was awarded before the 

effective date, the head of the 

contracting agency shall make best 

efforts to include in the contract a 

clause providing for the applicability to 

the contract of the amendments made by 

section 827. 

DoD has added a new clause at 

DFARS 252.216–7009, Allowability of 

Legal Costs Incurred in Connection 

With a Whistleblower Proceeding, as 

prescribed at DFARS 216.307(a). This 

clause is necessary to make the revised 

whistleblower cost principle applicable 

to any task orders issued against 

contracts awarded prior to the effective 

date of this regulation and any contracts 

modified to implement section 827. 

Otherwise, unless the terms of the 

contract state otherwise, FAR clause 

52.216–7, Allowable Cost and Payment, 

states in paragraph (a) that costs are 

determined to be allowable in 

accordance with FAR subpart 31.2 in 

effect on the date of the contract award. 

DFARS Case 2013–D010 will address 

the paragraphs of section 827 that 

provide enhancements of whistleblower 

protections for contractor employees, 

including revisions to 10 U.S.C. 2409. 

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 a significant 

regulatory action and, therefore, was 

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 

DoD does not expect this interim 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., 

because most contracts awarded to 

small entities are awarded on a 

competitive fixed-price basis, and do 

not require application of the cost 

principles contained in this rule. 

However, an initial regulatory flexibility 

analysis has been performed and is 

summarized as follows: 

The reason for the action is to 

implement paragraphs 827(g) and (i) of 

the National Defense Authorization Act 

for Fiscal Year 2013 (Pub. L. 112–239). 

Section 827(g) expands the cost 

principle at 10 U.S.C. 2324(k) to apply 

the cost principle on allowability of 

costs related to legal and other 

proceedings to costs incurred by 

contractors in proceedings commenced 

by a contractor employee submitting a 

complaint under 10 U.S.C. 2409 

(whistleblowing), and include as 

specifically unallowable, legal costs of a 

proceeding that results in an order to 

take corrective action under 10 U.S.C. 

2409. The legal basis for the rule is 10 

U.S.C. 2324(k). 

Most contracts awarded on a fixedprice competitive basis do not require 

application of the cost principles. The 

majority of contracts valued at or below 

the simplified acquisition threshold are 

awarded on a fixed price competitive 

basis. Requiring submission of certified 

cost or pricing data for acquisitions that 

do not exceed the simplified acquisition 

threshold is prohibited (FAR 15.403– 

4(a)(2). According to the Federal 

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Federal Register / Vol. 78, No. 189 / Monday, September 30, 2013 / Rules and Regulations 59861 

Procurement Data System data for Fiscal 

Year (FY) 2012, there were 48,115 new 

DoD contract awards over the simplified 

acquisition threshold in FY 2012. Of 

those contracts, only 6,760 awards were 

to small businesses on other than a 

competitive fixed-price basis. 

Estimating 3 awards per small business, 

that could involve about 2,600 small 

businesses. However, this rule would 

only affect a contractor if a contractor 

employee commenced a proceeding by 

submitting a complaint under 10 U.S.C. 

2409, and if that proceeding resulted in 

imposition of a monetary penalty or an 

order to take corrective action under 10 

U.S.C. 2409. We do not have data on the 

percentage of contracts that involve 

submission of a whistleblower 

complaint and result in monetary 

penalty or an order to take corrective 

action. 

There are no projected reporting, 

recordkeeping, or other compliance 

requirements of this rule. 

The rule does not duplicate, overlap, 

or conflict with any other Federal rules. 

DoD was unable to identify any 

alternatives to the rule that would 

reduce the impact on small entities and 

still meet the requirements of the 

statute. 

DoD will also consider comments 

from small entities concerning the 

existing regulations in subparts affected 

by this 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 2013–D022), in 

correspondence. 

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). 

VI. Determination To Issue an Interim 

Rule 

A determination has been made under 

the authority of the Secretary of Defense 

that urgent and compelling reasons exist 

to promulgate this interim rule without 

prior opportunity for public comment. 

By operation of law, the new statute for 

the whistleblower protection became 

effective on July 1, 2013, i.e., Congress 

included language in section 827(i) 

specifically addressing the effective date 

of the revisions to 10 U.S.C. 2409 and 

10 U.S.C. 2324. Section 827(g), which is 

implemented through this rulemaking, 

addresses the contractor’s legal fees 

arising from an employee’s complaint of 

reprisal and makes these fees expressly 

unallowable costs when there is 

contractor culpability. The most 

effective and efficient way to ensure 

awareness and compliance by the DoD 

and its contractors with section 827(g) is 

through the issuance of an interim rule. 

This regulation requires nothing beyond 

that which is set forth clearly in the 

statute. However, pursuant to 41 U.S.C. 

1707 and FAR 1.501–3(b), DoD will 

consider public comments received in 

response to this interim rule in the 

formation of the final rule. 

List of Subjects in 48 CFR Parts 216 and 

252 

Government procurement. 

Manuel Quinones, 

Editor, Defense Acquisition Regulations 

System. 

Therefore, 48 CFR parts 216 and 252 

are amended as follows: 

■ 1. The authority citation for 48 CFR 

parts 216 and 252 continues to read as 

follows: 

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

Chapter 1. 

PART 216—TYPES OF CONTRACTS 

■ 2. Add section 216.307 to subpart 

216.3 to read as follows: 

216.307 Contract clauses. 

(a) As required by section 827 of the 

National Defense Authorization Act for 

Fiscal Year 2013 (Pub. L. 112–239), use 

the clause at 252.216–7009, 

Allowability of Costs Incurred in 

Connection With a Whistleblower 

Proceeding— 

(1) In task orders entered pursuant to 

contracts awarded before September 30, 

2013, that include the clause at FAR 

52.216–7, Allowable Cost and Payment; 

and 

(2) In contracts awarded before 

September 30, 2013, that— 

(i) Include the clause at FAR 52.216– 

7, Allowable Cost and Payment; and 

(ii) Are modified to include the clause 

at DFARS 252.203–7002, Requirement 

to Inform Employees of Whistleblower 

Rights, dated September 2013 or later. 

PART 252—SOLICITATION 

PROVISIONS AND CONTRACT 

CLAUSES 

■ 3. Add section 252.216–7009 to read 

as follows: 

252.216–7009 Allowability of legal costs 

incurred in connection with a whistleblower 

proceeding. 

As prescribed in 216.307(a), use the 

following clause: 

Allowability of Legal Costs Incurred in 

Connection With a Whistleblower 

Proceeding (SEP 2013) 

Pursuant to section 827 of the National 

Defense Authorization Act for Fiscal year 

2013 (Pub. L. 112–239), notwithstanding FAR 

clause 52.216–7, Allowable Cost and 

Payment— 

(1) The restrictions of FAR 31.205–47(b) on 

allowability of costs related to legal and other 

proceedings also apply to any proceeding 

brought by a contractor employee submitting 

a complaint under 10 U.S.C. 2409, entitled 

‘‘Contractor employees: protection from 

reprisal for disclosure of certain 

information;’’ and 

(2) Costs incurred in connection with a 

proceeding that is brought by a contractor 

employee submitting a complaint under 10 

U.S.C. 2409 are also unallowable if the result 

is an order to take corrective action under 10 

U.S.C. 2409. 

(End of clause) 

[FR Doc. 2013–23764 Filed 9–27–13; 8:45 am] 

BILLING CODE 5001–06–P 

DEPARTMENT OF VETERANS 

AFFAIRS 

48 CFR Part 819 

RIN 2900–AM92 

VA Acquisition Regulation: ServiceDisabled Veteran-Owned and VeteranOwned Small Business Status Protests 

AGENCY: Department of Veterans Affairs. 

ACTION: Interim final rule. 

SUMMARY: The Department of Veterans 

Affairs (VA) is amending its 

adjudication procedures for ServiceDisabled Veteran-Owned Small 

Businesses (SDVOSB) and VeteranOwned Small Businesses (VOSB) status 

protests, to provide that VA’s Director, 

Center for Veterans Enterprise (CVE), 

shall initially adjudicate SDVOSB and 

VOSB status protests, and to provide 

that protested businesses, if they are 

denied status, may appeal to VA’s 

Executive Director, Office of Small and 

Disadvantaged Business Utilization 

(OSDBU). Additionally, VA amends the 

title of CVE from the Center for Veterans 

Enterprise to the Center for Verification 

and Evaluation, to more appropriately 

represent the function of this office. 

DATES: Effective Date: This interim final 

rule is effective September 30, 2013. 

Comment Date: Comments must be 

received on or before November 29, 

2013. 

ADDRESSES: Written comments may be 

submitted through http://

www.Regulations.gov; by mail or handdelivery to Director, Regulation Policy 

and Management (02REG), Department 

of Veterans Affairs, 810 Vermont 

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