14240 Federal Register / Vol. 72, No. 58 / Tuesday, March 27, 2007 / Rules and Regulations 

issuance of the solicitation and the 

associated technical data package to 

United States and Canadian firms. 

DoD does not agree with the 

recommended change. A company 

located in the United States or Canada 

could fall within the definition of a 

Communist Chinese military company if 

it is owned or controlled by, or affiliated 

with, an element of the Government or 

armed forces of the People’s Republic of 

China. Also, the prohibition applies to 

subcontracts as well as contracts. An 

item of critical military technology 

could contain a subcontracted 

component that is not subject to the 

same controls as the end item, but is on 

the USML. Therefore, the contracting 

officer needs the specified notification 

from the requirements activity to 

identify all USML items and to ensure 

that the clause at DFARS 252.225–7007 

is included in solicitations and 

contracts for those items. 

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 rule affects only those 

entities that are a part of the industrial 

base of the People’s Republic of China 

or that are owned or controlled by, or 

affiliated with, an element of the 

Government or armed forces of the 

People’s Republic of China. 

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 225 and 

252 

Government procurement. 

Michele P. Peterson, 

Editor, Defense Acquisition Regulations 

System. 

Interim Rule Adopted as Final Without 

Change 

■ Accordingly, the interim rule 

amending 48 CFR Parts 225 and 252, 

which was published at 71 FR 53045 on 

September 8, 2006, is adopted as a final 

rule without change. 

[FR Doc. E7–5480 Filed 3–26–07; 8:45 am] 

BILLING CODE 5001–08–P 

DEPARTMENT OF DEFENSE 

Defense Acquisition Regulations 

System 

48 CFR Parts 232 and 252 

RIN 0750–AF28 

Defense Federal Acquisition 

Regulation Supplement; Electronic 

Submission and Processing of 

Payment Requests (DFARS Case 

2005–D009) 

AGENCY: Defense Acquisition 

Regulations System, Department of 

Defense (DoD). 

ACTION: Final rule. 

SUMMARY: DoD has issued a final rule 

amending the Defense Federal 

Acquisition Regulation Supplement 

(DFARS) to update policy addressing 

requirements for DoD contractors to 

submit payment requests in electronic 

form. The rule clarifies the situations 

under which DoD will grant exceptions 

to requirements for electronic 

submission of payment requests. 

EFFECTIVE DATE: March 27, 2007. 

FOR FURTHER INFORMATION CONTACT: Mr. 

John McPherson, Defense Acquisition 

Regulations System, 

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

3062 Defense Pentagon, Washington, DC 

20301–3062. Telephone (703) 602–0296; 

facsimile (703) 602–0350. Please cite 

DFARS Case 2005–D009. 

SUPPLEMENTARY INFORMATION: 

A. Background 

This final rule amends DFARS 

Subpart 232.70 and the corresponding 

contract clause at 252.232–7003 to 

clarify the situations under which DoD 

will grant exceptions to requirements 

for electronic submission of payment 

requests. 

DoD published a proposed rule at 71 

FR 14149 on March 21, 2006. Two 

sources submitted comments on the 

proposed rule. A discussion of the 

comments is provided below. 

1. Comment: One respondent 

recommended expansion of the DFARS 

text that permits the administrative 

contracting officer to authorize 

submission of a non-electronic payment 

request, to also provide this authority to 

the procuring contracting officer. The 

respondent stated that the expansion is 

necessary to identify authorized officials 

for contracts that are not administered 

by the Defense Contract Management 

Agency. 

DoD Response: DoD agrees that this 

authority belongs to the contracting 

officer administering the contract. 

However, there may be several 

contracting officers providing 

administrative support for a contract. 

Therefore, DoD has revised the rule to 

make this approval the responsibility of 

the contracting officer administering the 

contract for payment. 

2. Comment: One respondent stated 

there should be a distinction between 

the requirement for contractors to 

submit payment requests in electronic 

form and the requirement for DoD 

procurement officials to process 

supporting documents in electronic 

form. 

DoD Response: It is DoD policy for all 

required documentation to be submitted 

and processed in electronic form to 

facilitate the payment process. DoD 

believes the DFARS rule implements 

this policy and has made no related 

changes regarding this requirement in 

the final rule. 

3. Comment: One respondent 

recommended limiting the alternative 

payment request methods to 

conventional mail or facsimile. The 

respondent pointed out that each new 

alternative method of submission 

requires the establishment of business 

rules to properly monitor payment 

requests and to ensure timely payment. 

In addition, submission by methods 

such as e-mail will require the printing 

and scanning of documents and will 

increase the workload of the payment 

office. 

DoD Response: The final rule includes 

changes that limit the alternative 

payment request methods to 

conventional mail or facsimile. DoD 

recognizes that the Defense Finance and 

Accounting Service (DFAS) has 

established procedures with adequate 

controls for the paper and facsimile 

submission process to ensure 

prevention of duplicate payments and to 

provide an adequate audit trail. E-mail 

submission is not viable at this time, 

because DFAS presently does not have 

procedures in place to process such 

submissions and to maintain sufficient 

process control. 

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 rule is designed to avoid 

any such impact by permitting 

alternative means of requesting payment 

when submission of electronic payment 


rmajette on PROD1PC67 with RULES
Federal Register / Vol. 72, No. 58 / Tuesday, March 27, 2007 / Rules and Regulations 14241 

requests would be unduly burdensome 

to a contractor. 

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 232 and 

252 

Government procurement. 

Michele P. Peterson, 

Editor, Defense Acquisition Regulations 

System. 

■ Therefore, 48 CFR parts 232 and 252 

are amended as follows: 

■ 1. The authority citation for 48 CFR 

parts 232 and 252 continues to read as 

follows: 

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

Chapter 1. 

PART 232—CONTRACT FINANCING 

■ 2. Section 232.7002 is revised to read 

as follows: 

232.7002 Policy. 

(a) Contractors shall submit payment 

requests in electronic form, except for—

(1) Purchases paid for with a 

Governmentwide commercial purchase 

card; 

(2) Awards made to foreign vendors 

for work performed outside the United 

States; 

(3) Classified contracts or purchases 

when electronic submission and 

processing of payment requests could 

compromise the safeguarding of 

classified information or national 

security; 

(4) Contracts awarded by deployed 

contracting officers in the course of 

military operations, including, but not 

limited to, contingency operations as 

defined in 10 U.S.C. 101(a)(13) or 

humanitarian or peacekeeping 

operations as defined in 10 U.S.C. 

2302(8), or contracts awarded by 

contracting officers in the conduct of 

emergency operations, such as 

responses to natural disasters or 

national or civil emergencies; 

(5) Purchases to support unusual or 

compelling needs of the type described 

in FAR 6.302–2; 

(6) Cases in which DoD is unable to 

receive payment requests in electronic 

form; or 

(7) Cases in which the contracting 

officer administering the contract for 

payment has determined, in writing, 

that electronic submission would be 

unduly burdensome to the contractor. 

(b) DoD officials receiving payment 

requests in electronic form shall process 

the payment requests in electronic form. 

Any supporting documentation 

necessary for payment, such as 

receiving reports, contracts, contract 

modifications, and required 

certifications, also shall be processed in 

electronic form. Scanned documents are 

acceptable forms for processing 

supporting documentation. 

(c) When payment requests will not 

be submitted in electronic form—

(1) Payment requests shall be 

submitted by facsimile or conventional 

mail. The contracting officer shall 

consult with the payment office and the 

contract administration office regarding 

the method of payment request to be 

used; and 

(2) Section G of the contract shall 

specify the method of payment request. 

232.7003 [Amended] 

■ 3. Section 232.7003 is amended in 

paragraph (a)(3) by removing ‘‘http:// 

www.dod.mil/dfas/’’ and adding in its 

place ‘‘http://www.dod.mil/dfas/ 

contractorpay/ 

electroniccommerce.html’’. 

PART 252—SOLICITATION 

PROVISIONS AND CONTRACT 

CLAUSES 

■ 4. Section 252.232–7003 is amended 

as follows: 

■ a. By revising the clause date and 

paragraphs (b)(3)(ii) and (c); 

■ b. By redesignating paragraph (d) as 

paragraph (e); and 

■ c. By adding a new paragraph (d) to 

read as follows: 

252.232–7003 Electronic Submission of 

Payment Requests. 

* * * * * 

ELECTRONIC SUBMISSION OF PAYMENT 

REQUESTS (MAR 2007) 

* * * * * 

(b) * * * 

(3) * * * 

(ii) EDI implementation guides are 

available on the Internet at http:// 

www.dod.mil/dfas/contractorpay/ 

electroniccommerce.html. 

* * * * * 

(c) The Contractor may submit a payment 

request in non-electronic form only when—

(1) DoD is unable to receive a payment 

request in electronic form; or 

(2) The Contracting Officer administering 

the contract for payment has determined, in 

writing, that electronic submission would be 

unduly burdensome to the Contractor. In 

such cases, the Contractor shall include a 

copy of the Contracting Officer’s 

determination with each request for payment. 

(d) The Contractor shall submit any nonelectronic payment requests using the 

method or methods specified in Section G of 

the contract. 

* * * * * 

[FR Doc. E7–5478 Filed 3–26–07; 8:45 am] 

BILLING CODE 5001–08–P 

DEPARTMENT OF DEFENSE 

Defense Acquisition Regulations 

System 

48 CFR Part 252 

RIN 0750–AF49 

Defense Federal Acquisition 

Regulation Supplement; Free Trade 

Agreements—Guatemala and Bahrain 

(DFARS Case 2006–D028) 

AGENCY: Defense Acquisition 

Regulations System, Department of 

Defense (DoD). 

ACTION: Final rule. 

SUMMARY: DoD has adopted as final, 

without change, an interim rule 

amending the Defense Federal 

Acquisition Regulation Supplement 

(DFARS) to implement the United 

States-Bahrain Free Trade Agreement 

and the Dominican Republic-Central 

America-United States Free Trade 

Agreement with respect to Guatemala. 

The Free Trade Agreements waive the 

applicability of the Buy American Act 

for some foreign supplies and 

construction materials and specify 

procurement procedures designed to 

ensure fairness. 

EFFECTIVE DATE: March 27, 2007. 

FOR FURTHER INFORMATION CONTACT: Ms. 

Amy Williams, Defense Acquisition 

Regulations System, 

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

3062 Defense Pentagon, Washington, DC 

20301–3062. Telephone (703) 602–0328; 

facsimile (703) 602–0350. Please cite 

DFARS Case 2006–D028. 

SUPPLEMENTARY INFORMATION: 

A. Background 

DoD published an interim rule at 71 

FR 58541 on October 4, 2006, to 

implement the Dominican RepublicCentral America-United States Free 

Trade Agreement, with respect to 

Guatemala, and the United StatesBahrain Free Trade Agreement. The rule 

amended the appropriate DFARS 

provisions and clauses to reflect the 

addition of Guatemala and Bahrain as 

Free Trade Agreement countries. 

DoD received no comments on the 

interim rule. Therefore, DoD has 

adopted the interim rule as a final rule 

without change. 

This rule was not subject to Office of 

Management and Budget review under 


rmajette on PROD1PC67 with RULES