64916 Federal Register / Vol. 62, No. 236 / Tuesday, December 9, 1997 / Rules and Regulations

(iv) Writing to: Headquarters DCAA,

ATTN: CMO, Publications Officer, 8725

John J. Kingman Road, Suite 2135, Fort

Belvoir, VA 22060–6219.

* * * * *

4. Section 42.705–2 is amended by

revising paragraph (b)(1) to read as

follows:

42.705–2 Auditor determination

procedures.

* * * * *

(b) Procedures. (1) The contractor

shall submit to the cognizant

contracting officer and auditor a final

indirect cost rate proposal in accordance

with 42.705–1(b)(1).

* * * * *

PART 52—SOLICITATION PROVISIONS

AND CONTRACT CLAUSES

5. Section 52.216–7 is amended by

revising the date of the clause and

paragraph (d)(2) to read as follows:

52.216–7 Allowable Cost and Payment.

* * * * *

Allowable Cost and Payment (Feb 1998)

* * * * *

(d) * * *

(2)(i) The Contractor shall submit an

adequate final indirect cost rate

proposal to the Contracting Officer and

auditor within the 6-month period

following the expiration of each of its

fiscal years. Reasonable extensions, for

exceptional circumstances only, may be

requested in writing by the Contractor

and granted in writing by the

Contracting Officer. The Contractor

shall support its proposal with adequate

supporting data.

(ii) The proposed rates shall be based

on the Contractor’s actual cost

experience for that period. The

appropriate Government representative

and the Contractor shall establish the

final indirect cost rates as promptly as

practical after receipt of the Contractor’s

proposal.

* * * * *

6. Section 52.216–13 is amended by

revising the date of the clause; in the

introductory text of paragraph (c) by

removing the word ‘‘below’’ and

inserting ‘‘of this clause’’; and by

revising paragraph (c)(2) to read as

follows:

52.216–13 Allowable Cost and Payment—

Facilities.

* * * * *

Allowable Cost and Payment Facilities

(Feb 1998)

* * * * *

(c) * * *

(2)(i) The Contractor shall submit an

adequate final indirect cost rate

proposal to the Contracting Officer and

auditor within the 6-month period

following the expiration of each of its

fiscal years. Reasonable extensions, for

exceptional circumstances only, may be

requested in writing by the Contractor

and granted in writing by the

Contracting Officer. The Contractor

shall support its proposal with adequate

supporting data.

(ii) The proposed rates shall be based

on the Contractor’s actual cost

experience for that period. The

appropriate Government representative

and the Contractor shall establish the

final indirect cost rates as promptly as

practical after receipt of the Contractor’s

proposal.

* * * * *

7. Section 52.216–15 is amended by

revising the date of the clause and

paragraph (b) to read as follows:

52.216–15 Predetermined Indirect Cost

Rates.

* * * * *

Predetermined Indirect Cost Rates (Feb

1998)

* * * * *

(b)(1) The Contractor shall submit an

adequate final indirect cost rate

proposal to the Contracting Officer and

auditor within the 6-month period

following the expiration of each of its

fiscal years. Reasonable extensions, for

exceptional circumstances only, may be

requested in writing by the Contractor

and granted in writing by the

Contracting Officer. The Contractor

shall support its proposal with adequate

supporting data.

(2) The proposed rates shall be based

on the Contractor’s actual cost

experience for that period. The

appropriate Government representative

and the Contractor shall establish the

final indirect cost rates as promptly as

practical after receipt of the Contractor’s

proposal.

* * * * *

[FR Doc. 97–31816 Filed 12–8–97; 8:45 am]

BILLING CODE 6820–EP–P

DEPARTMENT OF DEFENSE

GENERAL SERVICES

ADMINISTRATION

NATIONAL AERONAUTICS AND

SPACE ADMINISTRATION

48 CFR Parts 4, 6, 8, 12, 13, 16, 19, 32,

41, 43, 49, 52, and 53

[FAC 97–03; FAR Case 94–772; Item IV]

RIN 9000–AH24

Federal Acquisition Regulation;

Reorganization of FAR Part 13,

Simplified Acquisition Procedures

AGENCIES: Department of Defense (DoD),

General Services Administration (GSA),

and National Aeronautics and Space

Administration (NASA).

ACTION: Final rule.

SUMMARY: The Civilian Agency

Acquisition Council and the Defense

Acquisition Regulations Council have

agreed on a final rule amending the

Federal Acquisition Regulation (FAR) to

reorganize part 13 for clarity and to

make other changes to facilitate the use

of electronic commerce in Government

contracting. This regulatory action was

not subject to Office of Management and

Budget review under Executive Order

12866, dated September 30, 1993. This

is not a major rule under 5 U.S.C. 804.

EFFECTIVE DATE: February 9, 1998.

FOR FURTHER INFORMATION CONTACT:

The FAR Secretariat, Room 4035, GS

Building, Washington, DC 20405, (202)

501–4755, for information pertaining to

status or publication schedules. For

clarification of content, contact Mr. Paul

Linfield, Procurement Analyst, at (202)

501–1757. Please cite FAC 97–03, FAR

case 94–772.

SUPPLEMENTARY INFORMATION:

A. Background

This final rule revises FAR part 13 to

reorganize its contents in a more

process-oriented manner and to

emphasize the use of electronic

contracting and the Governmentwide

commercial purchase card. FAR part 52

is amended to permit agency provisions

and clauses to be incorporated by

reference in solicitations and contracts,

if the full text of the provisions and

clauses may be accessed electronically

by prospective contractors. A new

clause is added at FAR 52.213–4 for use

in simplified acquisitions; the clause is

a compilation of the required and most

commonly used clauses that apply to

simplified acquisitions, and may be

used in lieu of individual clauses

prescribed in the FAR.
Federal Register / Vol. 62, No. 236 / Tuesday, December 9, 1997 / Rules and Regulations 64917

This effort was initiated as a result of

public comments received during the

comment period on FAR case 94–770,

published in the Federal Register as an

interim rule on July 3, 1995 (60 FR

34741). A proposed rule was published

in the Federal Register on September

13, 1996 (61 FR 48532).

Thirteen public comments were

received in response to the proposed

rule. All comments were considered in

the development of the final rule.

B. Regulatory Flexibility Act

A Final Regulatory Flexibility

Analysis has been performed. A copy of

the analysis may be obtained from the

FAR Secretariat. The analysis is

summarized as follows:

This rule amends the Federal Acquisition

Regulation (FAR) by reorganizing the

structure and material of part 13 in a manner

that would be clear to those individuals that

are newly authorized to make micropurchases. The Federal Acquisition

Streamlining Act of 1994 (FASA) (Pub. L.

103–355) authorized individuals other than

contracting officers to make purchases under

$2,500 (micro-purchases). Also, the rule takes

into account the anticipated impact on the

workload of agency procurement personnel

of evaluating the many sources that may

respond electronically to contract actions

that are initiated with widespread electronic

public notice. Changes made by the rule will

better enable agencies to capture the benefits

of using electronic commerce in these

situations. There were no public comments

received in response to the initial regulatory

flexibility analysis. Changes in FAR part 52

may affect a significant number of small

entities that participate in Federal agency

procurements. The provisions and clauses in

this FAR part generally are not required for

micro-purchases. It is estimated that 40

percent of the contract actions below $25,000

are micro-purchases. Approximately 50

percent of all contract actions of $100,000 or

less are annually awarded to small business

concerns. The rule will impose no new

reporting, recordkeeping, or other

compliance requirements on large or small

entities. The changes to part 52 may have

more impact on small business concerns than

large business concerns because these

changes make it more imperative that small

business concerns have electronic capability

to receive and transmit procurement

information. This rule authorizes the

incorporation by reference of any provision

or clause used by an agency contracting

activity, provided that provision or clause

was accessible electronically to an offeror or

prospective contractor. The changes in part

52 should also result in a reduction in the

number of pages that a prospective contractor

will have to submit with its offer to the

Government. An alternative that was

considered was making solicitation

provisions and clauses available to

prospective contractors at the time they

registered with the Central Contractor

Registration (CCR). In order to conduct

electronic commerce with any agency of the

Federal Government, a potential contractor

must register with the CCR. However,

providing provisions and clauses at the time

of registration with the CCR does not appear

to be practical, since the prospective

contractor would not have any assurance that

the provisions and clauses were current at

the time it wanted to participate in an agency

procurement.

C. Paperwork Reduction Act

The Paperwork Reduction Act does

not apply because the changes to the

FAR do not impose recordkeeping or

information collection requirements, or

collections of information from offerors,

contractors, or members of the public

which 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 4, 6, 8,

12, 13, 16, 19, 32, 41, 43, 49, 52, and

53

Government procurement.

Dated: December 1, 1997.

Edward C. Loeb,

Director, Federal Acquisition Policy Division.

Therefore, 48 CFR parts 4, 6, 8, 12, 13,

16, 19, 32, 41, 43, 49, 52, and 53 are

amended as set forth below:

1. The authority citation for 48 CFR

parts 4, 6, 8, 12, 13, 6, 19, 32, 41, 43,

49, 52, and 53 continues to read as

follows:

Authority: 40 U.S.C. 486(c); 10 U.S.C.

chapter 137; and 42 U.S.C. 2473(c).

PART 4—ADMINISTRATIVE MATTERS

4.800 [Amended]

2. Section 4.800 is amended to revise

the reference in the parenthetical to read

‘‘13.106–3(b)’’.

PART 6—COMPETITION

REQUIREMENTS

6.001 [Amended]

3. Section 6.001 is amended in

paragraph (a) by revising the references

‘‘13.602’’ and ‘‘subpart 13.6’’ to read

‘‘13.501’’ and ‘‘subpart 13.5’’,

respectively.

PART 8—REQUIRED SOURCES OF

SUPPLIES AND SERVICES

8.404 [Amended]

4. Section 8.404 is amended in the

first sentence of paragraph (b)(4) by

revising the parenthetical to read ‘‘(see

13.303–2(c)(3))’’.

PART 12—ACQUISITION OF

COMMERCIAL ITEMS

5. Section 12.102 is amended by

revising paragraphs (d)(2) and (d)(3) to

read as follows:

12.102 Applicability.

* * * * *

(d) * * *

(2) Using the Standard Form 44 (see

13.306);

(3) Using the imprest fund (see

13.305); or

* * * * *

12.203 [Amended]

6. Section 12.203 is amended in the

last sentence of the undesignated

paragraph by revising the reference

‘‘subpart 13.6’’ to read ‘‘subpart 13.5’’.

12.206, 12.301, and 12.602 [Amended]

7. In the following sections, remove

‘‘13.106–2’’ and insert ‘‘13.106’’: 12.206,

12.301(c)(2), 12.602(a), and 12.602(b).

8. Part 13 is revised to read as follows:

PART 13—SIMPLIFIED ACQUISITION

PROCEDURES

13.000 Scope of part.

13.001 Definitions.

13.002 Purpose.

13.003 Policy.

13.004 Legal effect of quotations.

13.005 Federal Acquisition Streamlining

Act of 1994 list of inapplicable laws.

13.006 Inapplicable provisions and clauses.

Subpart 13.1—Procedures

13.101 General.

13.102 Source list.

13.103 Use of standing price quotations.

13.104 Promoting competition.

13.105 Synopsis and posting requirements.

13.106 Soliciting competition, evaluation of

quotations or offers, award and

documentation.

13.106–1 Soliciting competition.

13.106–2 Evaluation of quotations or offers.

13.106–3 Award and documentation.

Subpart 13.2—Actions at or Below the

Micro-Purchase Threshold

13.201 General.

13.202 Purchase guidelines.

Subpart 13.3—Simplified Acquisition

Methods

13.301 Governmentwide commercial

purchase card.

13.302 Purchase orders.

13.302–1 General.

13.302–2 Unpriced purchase orders.

13.302–3 Obtaining contractor acceptance

and modifying purchase orders.

13.302–4 Termination or cancellation of

purchase orders.

13.302–5 Clauses.

13.303 Blanket purchase agreements

(BPAs).

13.303–1 General.

13.303–2 Establishment of BPAs.

13.303–3 Preparation of BPAs.

13.303–4 Clauses.

13.303–5 Purchases under BPAs.

13.303–6 Review procedures.

13.303–7 Completion of BPAs.

13.303–8 Optional clause.

13.304 [Reserved]

13.305 Imprest funds and third party drafts.
64918 Federal Register / Vol. 62, No. 236 / Tuesday, December 9, 1997 / Rules and Regulations

13.305–1 General.

13.305–2 Agency responsibilities.

13.305–3 Conditions for use.

13.305–4 Procedures.

13.306 SF 44, Purchase Order—Invoice—

Voucher.

13.307 Forms.

Subpart 13.4—Fast Payment Procedure

13.401 General.

13.402 Conditions for use.

13.403 Preparation and execution of orders.

13.404 Contract clause.

Subpart 13.5—Test Program for Certain

Commercial Items

13.500 General.

13.501 Special documentation

requirements.

13.000 Scope of part.

This part prescribes policies and

procedures for the acquisition of

supplies and services, including

construction, research and

development, and commercial items,

the aggregate amount of which does not

exceed the simplified acquisition

threshold (see 2.101). Subpart 13.5

provides special authority for

acquisitions of commercial items

exceeding the simplified acquisition

threshold but not exceeding $5,000,000,

including options. See part 12 for

policies applicable to the acquisition of

commercial items exceeding the micropurchase threshold. See 36.602–5 for

simplified procedures to be used when

acquiring architect-engineer services.

13.001 Definitions.

As used in this part—

Authorized individual means a person

who has been granted authority, in

accordance with agency procedures, to

acquire supplies and services in

accordance with this part.

Governmentwide commercial

purchase card means a purchase card,

similar in nature to a commercial credit

card, issued to authorized agency

personnel to use to acquire and to pay

for supplies and services.

Imprest fund means a cash fund of a

fixed amount established by an advance

of funds, without charge to an

appropriation, from an agency finance

or disbursing officer to a duly appointed

cashier, for disbursement as needed

from time to time in making payment in

cash for relatively small amounts.

Purchase order means an offer by the

Government to buy supplies or services,

including construction and research and

development, upon specified terms and

conditions, using simplified acquisition

procedures.

Third party draft means an agency

bank draft, similar to a check, that is

used to acquire and to pay for supplies

and services. (See Treasury Financial

Management Manual, Section 3040.70.)

13.002 Purpose.

The purpose of this part is to

prescribe simplified acquisition

procedures in order to—

(a) Reduce administrative costs;

(b) Improve opportunities for small,

small disadvantaged, and womenowned small business concerns to

obtain a fair proportion of Government

contracts;

(c) Promote efficiency and economy

in contracting; and

(d) Avoid unnecessary burdens for

agencies and contractors.

13.003 Policy.

(a) Agencies shall use simplified

acquisition procedures to the maximum

extent practicable for all purchases of

supplies or services not exceeding the

simplified acquisition threshold

(including purchases at or below the

micro-purchase threshold). This policy

does not apply if an agency can meet its

requirement using—

(1) Required sources of supply under

part 8 (e.g., Federal Prison Industries,

Committee for Purchase from People

Who are Blind or Severely Disabled, and

Federal Supply Schedule contracts);

(2) Existing indefinite delivery/

indefinite quantity contracts; or

(3) Other established contracts.

(b)(1) Each acquisition of supplies or

services that has an anticipated dollar

value exceeding $2,500 and not

exceeding $100,000 is reserved

exclusively for small business concerns

and shall be set aside (see 19.000 and

subpart 19.5). See 19.502–2 for

exceptions.

(2) Each written solicitation under a

set-aside shall contain the appropriate

provisions prescribed by part 19. If the

solicitation is oral, however,

information substantially identical to

that in the provision shall be given to

potential quoters.

(c) The contracting office shall use

simplified acquisition procedures for

contract actions exceeding $50,000 after

December 31, 1999, only if the office’s

cognizant agency has certified full

FACNET capability in accordance with

4.505–2. This limitation does not apply

to acquisitions of commercial items

conducted using subpart 13.5.

(d) The contracting officer shall not

use simplified acquisition procedures to

acquire supplies and services if the

anticipated award will exceed the

simplified acquisition threshold (or

$5,000,000, including options, for

acquisitions of commercial items using

Subpart 13.5). Do not break down

requirements aggregating more than the

simplified acquisition threshold (or for

commercial items, the threshold in

subpart 13.5) or the micro-purchase

threshold into several purchases that are

less than the applicable threshold

merely to—

(1) Permit use of simplified

acquisition procedures; or

(2) Avoid any requirement that

applies to purchases exceeding the

micro-purchase threshold.

(e) An agency that has specific

statutory authority to acquire personal

services (see 37.104) may use simplified

acquisition procedures to acquire those

services.

(f) Agencies shall use the

Governmentwide commercial purchase

card and electronic purchasing

techniques to the maximum extent

practicable in conducting simplified

acquisitions.

(g) For contract actions exceeding the

micro-purchase threshold but not

exceeding the simplified acquisition

threshold, agencies shall maximize the

use of FACNET, when practicable and

cost-effective (see 4.506), to acquire

supplies and services (including

construction, research and

development, and architect-engineer).

FACNET also may be used for contract

actions exceeding the simplified

acquisition threshold. Drawings and

lengthy specifications can be provided

off-line in hard copy or through other

appropriate means.

(h) Authorized individuals shall make

purchases in the simplified manner that

is most suitable, efficient, and

economical based on the circumstances

of each acquisition. For acquisitions not

expected to exceed—

(1) The simplified acquisition

threshold for other than commercial

items, use any appropriate combination

of the procedures in parts 13, 14, 15, 35,

or 36, including the use of Standard

Form 1442, Solicitation, Offer, and

Award (Construction, Alteration, or

Repair), for construction contracts (see

36.701(b)); or

(2) $5 million for commercial items,

use any appropriate combination of the

procedures in parts 12, 13, 14, and 15

(see paragraph (d) of this section).

(i) In addition to other considerations,

contracting officers shall—

(1) Promote competition to the

maximum extent practicable (see

13.104);

(2) Establish deadlines for the

submission of responses to solicitations

that afford suppliers a reasonable

opportunity to respond (see 5.203);

(3) Consider all quotations or offers

that are timely received. For evaluation

of quotations or offers conducted
Federal Register / Vol. 62, No. 236 / Tuesday, December 9, 1997 / Rules and Regulations 64919

through FACNET, see 13.106–2(b)(3);

and

(4) Use innovative approaches, to the

maximum extent practicable, in

awarding contracts using simplified

acquisition procedures.

13.004 Legal effect of quotations.

(a) A quotation is not an offer and,

consequently, cannot be accepted by the

Government to form a binding contract.

Therefore, issuance by the Government

of an order in response to a supplier’s

quotation does not establish a contract.

The order is an offer by the Government

to the supplier to buy certain supplies

or services upon specified terms and

conditions. A contract is established

when the supplier accepts the offer.

(b) When appropriate, the contracting

officer may ask the supplier to indicate

acceptance of an order by notification to

the Government, preferably in writing,

as defined at 2.101. In other

circumstances, the supplier may

indicate acceptance by furnishing the

supplies or services ordered or by

proceeding with the work to the point

where substantial performance has

occurred.

(c) If the Government issues an order

resulting from a quotation, the

Government may (by written notice to

the supplier, at any time before

acceptance occurs) withdraw, amend, or

cancel its offer. (See 13.302–4 for

procedures on termination or

cancellation of purchase orders.)

13.005 Federal Acquisition Streamlining

Act of 1994 list of inapplicable laws.

(a) The following laws are

inapplicable to all contracts and

subcontracts (if otherwise applicable to

subcontracts) at or below the simplified

acquisition threshold:

(1) 41 U.S.C. 57(a) and (b) (AntiKickback Act of 1986). (Only the

requirement for the incorporation of the

contractor procedures for the prevention

and detection of violations, and the

contractual requirement for contractor

cooperation in investigations are

inapplicable.).

(2) 40 U.S.C. 270a (Miller Act).

(Although the Miller Act does not apply

to contracts at or below the simplified

acquisition threshold, alternative forms

of payment protection for suppliers of

labor and material (see 28.102) are still

required if the contract exceeds

$25,000.).

(3) 40 U.S.C. 327—333 (Contract Work

Hours and Safety Standards Act—

Overtime Compensation).

(4) 41 U.S.C. 701(a)(1) (Section 5152

of the Drug-Free Workplace Act of

1988), except for individuals.

(5) 42 U.S.C. 6962 (Solid Waste

Disposal Act). (Only the requirement for

providing the estimate of recovered

material utilized in the performance of

the contract is inapplicable.)

(6) 10 U.S.C. 2306(b) and 41 U.S.C.

254(a) (Contract Clause Regarding

Contingent Fees).

(7) 10 U.S.C. 2313 and 41 U.S.C.

254(c) (Authority to Examine Books and

Records of Contractors).

(8) 10 U.S.C. 2402 and 41 U.S.C. 253g

(Prohibition on Limiting Subcontractor

Direct Sales to the United States).

(b) The Federal Acquisition

Regulatory (FAR) Council will include

any law enacted after October 13, 1994,

that sets forth policies, procedures,

requirements, or restrictions for the

acquisition of property or services, on

the list set forth in paragraph (a) of this

section. The FAR Council may make

exceptions when it determines in

writing that it is in the best interest of

the Government that the enactment

should apply to contracts or

subcontracts not greater than the

simplified acquisition threshold.

(c) The provisions of paragraph (b) of

this section do not apply to laws that—

(1) Provide for criminal or civil

penalties; or

(2) Specifically state that

notwithstanding the language of Section

4101, Public Law 103–355, the

enactment will be applicable to

contracts or subcontracts in amounts not

greater than the simplified acquisition

threshold.

(d) Any individual may petition the

Administrator, Office of Federal

Procurement Policy (OFPP), to include

any applicable provision of law not

included on the list set forth in

paragraph (a) of this section unless the

FAR Council has already determined in

writing that the law is applicable. The

Administrator, OFPP, will include the

law on the list in paragraph (a) of this

section unless the FAR Council makes

a determination that it is applicable

within 60 days of receiving the petition.

13.006 Inapplicable provisions and

clauses.

While certain statutes still apply,

pursuant to Public Law 103–355, the

following provisions and clauses are

inapplicable to contracts and

subcontracts at or below the simplified

acquisition threshold:

(a) 52.203–5, Covenant Against

Contingent Fees.

(b) 52.203–6, Restrictions on

Subcontractor Sales to the

Government.

(c) 52.203–7, Anti-Kickback

Procedures.

(d) 52.215–2, Audits and Records—

Negotiation.

(e) 52.222–4, Contract Work Hours

and Safety Standards Act—Overtime

Compensation.

(f) 52.223–6, Drug-Free Workplace,

except for individuals.

(g) 52.223–9, Certification and

Estimate of Percentage of Recovered

Material Content for EPA Designated

Items.

Subpart 13.1—Procedures

13.101 General.

(a) In making purchases, contracting

officers shall—

(1) Comply with the policy in 7.202

relating to economic purchase

quantities, when practicable;

(2) Satisfy the procedures described in

subpart 19.6 with respect to Certificates

of Competency before rejecting a

quotation, oral or written, from a small

business concern determined to be

nonresponsible (see subpart 9.1);

(3) Use United States-owned excess or

near-excess foreign currency, if

appropriate, in making payments under

simplified acquisition procedures (see

subpart 25.3); and

(4) Provide for the inspection of

supplies or services as prescribed in

46.404.

(b) In making purchases, contracting

officers should—

(1) Include related items (such as

small hardware items or spare parts for

vehicles) in one solicitation and make

award on an ‘‘all-or-none’’ or ‘‘multiple

award’’ basis provided suppliers are so

advised when quotations or offers are

requested;

(2) Incorporate provisions and clauses

by reference in solicitations and in

awards under requests for quotations,

provided the requirements in 52.102 are

satisfied;

(3) Make maximum effort to obtain

trade and prompt payment discounts

(see 14.408–3). Prompt payment

discounts shall not be considered in the

evaluation of quotations; and

(4) Use bulk funding to the maximum

extent practicable. Bulk funding is a

system whereby the contracting officer

receives authorization from a fiscal and

accounting officer to obligate funds on

purchase documents against a specified

lump sum of funds reserved for the

purpose for a specified period of time

rather than obtaining individual

obligational authority on each purchase

document. Bulk funding is particularly

appropriate if numerous purchases

using the same type of funds are to be

made during a given period.

13.102 Source list.

(a) Each contracting office should

maintain a source list (or lists, if more
64920 Federal Register / Vol. 62, No. 236 / Tuesday, December 9, 1997 / Rules and Regulations

convenient). New supply sources for the

list may be obtained from a variety of

sources, including the Procurement

Automated Source System (PASS) of the

Small Business Administration and the

Central Contractor Registration (CCR)

Data Base (see 4.503). The list should

identify the status of each source (when

the status is made known to the

contracting office) in the following

categories:

(1) Small business.

(2) Small disadvantaged business.

(3) Women-owned small business.

(b) The status information may be

used as the basis to ensure that small

business concerns are provided the

maximum practicable opportunities to

respond to solicitations issued using

simplified acquisition procedures.

13.103 Use of standing price quotations.

Authorized individuals do not have to

obtain individual quotations for each

purchase. Standing price quotations

may be used if—

(a) The pricing information is current;

and

(b) The Government obtains the

benefit of maximum discounts before

award.

13.104 Promoting competition.

The contracting officer shall promote

competition to the maximum extent

practicable to obtain supplies and

services from the source whose offer is

the most advantageous to the

Government, considering the

administrative cost of the purchase.

(a) The contracting officer shall not—

(1) Solicit quotations based on

personal preference; or

(2) Restrict solicitation to suppliers of

well-known and widely distributed

makes or brands.

(b) If using simplified acquisition

procedures and not using FACNET,

maximum practicable competition

ordinarily can be obtained by soliciting

quotations or offers from sources within

the local trade area. Unless the contract

action requires synopsis pursuant to

5.101 and an exception under 5.202 is

not applicable, consider solicitation of

at least three sources to promote

competition to the maximum extent

practicable. Whenever practicable,

request quotations or offers from two

sources not included in the previous

solicitation.

13.105 Synopsis and posting

requirements.

(a) The contracting officer shall

comply with the public display and

synopsis requirements of 5.101 and

5.203 unless—

(1) FACNET is used for an acquisition

at or below the simplified acquisition

threshold; or

(2) An exception in 5.202 applies.

(b) When acquiring commercial items,

the contracting officer may use a

combined synopsis/solicitation. In such

cases, a separate solicitation is not

required. The contracting officer must

include enough information to permit

suppliers to develop quotations or

offers.

13.106 Soliciting competition, evaluation

of quotations or offers, award and

documentation.

13.106–1 Soliciting competition.

(a) Considerations. In soliciting

competition, the contracting officer

shall consider the guidance in 13.104

and the following before requesting

quotations or offers:

(1)(i) The nature of the article or

service to be purchased and whether it

is highly competitive and readily

available in several makes or brands, or

is relatively noncompetitive.

(ii) Information obtained in making

recent purchases of the same or similar

item.

(iii) The urgency of the proposed

purchase.

(iv) The dollar value of the proposed

purchase.

(v) Past experience concerning

specific dealers’ prices.

(2) When soliciting quotations or

offers, the contracting officer shall

notify potential quoters or offerors of the

basis on which award will be made

(price alone or price and other factors,

e.g., past performance and quality).

Contracting officers are encouraged to

use best value. Solicitations are not

required to state the relative importance

assigned to each evaluation factor and

subfactor, nor are they required to

include subfactors.

(b) Soliciting from a single source. (1)

For purchases not exceeding the

simplified acquisition threshold,

contracting officers may solicit from one

source if the contracting officer

determines that the circumstances of the

contract action deem only one source

reasonably available (e.g., urgency,

exclusive licensing agreements, or

industrial mobilization).

(2) For sole source acquisitions of

commercial items in excess of the

simplified acquisition threshold

conducted pursuant to subpart 13.5, the

requirements at 13.501(a) apply.

(c) Soliciting orally. (1) The

contracting officer shall solicit

quotations orally to the maximum

extent practicable, if—

(i) The acquisition does not exceed

the simplified acquisition threshold;

(ii) FACNET is not available or the

contracting office has a written

determination that it is not practicable

or cost-effective to purchase via

FACNET (see 4.506); and

(iii) Notice is not required under

5.101.

(2) However, an oral solicitation may

not be practicable for contract actions

exceeding $25,000 unless covered by an

exception in 5.202.

(d) Written solicitations. If obtaining

electronic or oral quotations is

uneconomical or impracticable, the

contracting officer should issue paper

solicitations for contract actions likely

to exceed $25,000. The contracting

officer shall issue a written solicitation

for construction requirements exceeding

$2,000.

(e) Use of options. Options may be

included in solicitations, provided the

requirements of subpart 17.2 are met

and the aggregate value of the

acquisition and all options does not

exceed the dollar threshold for use of

simplified acquisition procedures.

(f) Inquiries. An agency should

respond to inquiries received through

any medium (including FACNET) if

doing so would not interfere with the

efficient conduct of the acquisition. For

an acquisition conducted through

FACNET, an agency must respond to

telephonic or facsimile inquiries only if

it is unable to receive inquiries through

FACNET.

13.106–2 Evaluation of quotations or

offers.

(a) General. (1) The contracting officer

shall evaluate quotations or offers—

(i) In an impartial manner; and

(ii) Inclusive of transportation charges

from the shipping point of the supplier

to the delivery destination.

(2) Quotations or offers shall be

evaluated on the basis established in the

solicitation.

(3) All quotations or offers shall be

considered (see paragraph (b) of this

subsection).

(b) Evaluation procedures. (1) The

contracting officer has broad discretion

in fashioning suitable evaluation

procedures. The procedures prescribed

in parts 14 and 15 are not mandatory.

At the contracting officer’s discretion,

one or more, but not necessarily all, of

the evaluation procedures in part 14 or

15 may be used.

(2) If using price and other factors,

ensure that quotations or offers can be

evaluated in an efficient and minimally

burdensome fashion. Formal evaluation

plans and establishing a competitive

range, conducting discussions, and

scoring quotations or offers are not

required. Contracting offices may
Federal Register / Vol. 62, No. 236 / Tuesday, December 9, 1997 / Rules and Regulations 64921

conduct comparative evaluations of

offers. Evaluation of other factors, such

as past performance—

(i) Does not require the creation or

existence of a formal data base; and

(ii) May be based on information such

as the contracting officer’s knowledge of

and previous experience with the

supply or service being acquired,

customer surveys, or other reasonable

basis.

(3) For acquisitions conducted using

FACNET, the contracting officer may—

(i) After preliminary consideration of

all quotations or offers, identify from all

quotations or offers received one that is

suitable to the user, such as the lowest

priced brand name product, and quickly

screen all lower priced quotations or

offers based on readily discernible value

indicators, such as past performance,

warranty conditions, and maintenance

availability; or

(ii) Where an evaluation is based only

on price and past performance, make an

award based on whether the lowest

priced of the quotations or offers having

the highest past performance rating

possible represents the best value when

compared to any lower priced quotation

or offer.

13.106–3 Award and documentation.

(a) Basis for award. Before making

award, the contracting officer shall

determine that the proposed price is fair

and reasonable.

(1) Whenever possible, base price

reasonableness on competitive

quotations or offers.

(2) If only one response is received,

include a statement of price

reasonableness in the contract file. The

statement may be based on—

(i) Market research;

(ii) Comparison of the proposed price

with prices found reasonable on

previous purchases;

(iii) Current price lists, catalogs, or

advertisements;

(iv) A comparison with similar items

in a related industry;

(v) Value analysis;

(vi) The contracting officer’s personal

knowledge of the item being purchased;

(vii) Comparison to an independent

Government estimate; or

(viii) Any other reasonable basis.

(3) Occasionally an item can be

obtained only from a supplier that

quotes a minimum order price or

quantity that either unreasonably

exceeds stated quantity requirements or

results in an unreasonable price for the

quantity required. In these instances,

the contracting officer should inform the

requiring activity of all facts regarding

the quotation or offer and ask it to

confirm or alter its requirement. The file

shall be documented to support the final

action taken.

(b) File documentation and retention.

Keep documentation to a minimum.

Purchasing offices shall retain data

supporting purchases (paper or

electronic) to the minimum extent and

duration necessary for management

review purposes (see subpart 4.8). The

following illustrate the extent to which

quotation or offer information should be

recorded:

(1) Oral solicitations. The contracting

office should establish and maintain

records of oral price quotations in order

to reflect clearly the propriety of placing

the order at the price paid with the

supplier concerned. In most cases, this

will consist merely of showing the

names of the suppliers contacted and

the prices and other terms and

conditions quoted by each.

(2) Written solicitations (see 2.101).

For acquisitions not exceeding the

simplified acquisition threshold, limit

written records of solicitations or offers

to notes or abstracts to show prices,

delivery, references to printed price lists

used, the supplier or suppliers

contacted, and other pertinent data.

(3) Special situations. Include

additional statements—

(i) Explaining the absence of

competition if only one source is

solicited and the acquisition does not

exceed the simplified acquisition

threshold (does not apply to an

acquisition of utility services available

from only one source); or

(ii) Supporting the award decision if

other than price-related factors were

considered in selecting the supplier.

(c) Notification. For acquisitions that

do not exceed the simplified acquisition

threshold and for which automatic

notification is not provided through

FACNET, notification to unsuccessful

suppliers shall be given only if

requested or required by 5.301.

(d) Request for information. If a

supplier requests information on an

award that was based on factors other

than price alone, a brief explanation of

the basis for the contract award decision

shall be provided (see 15.503(b)(2)).

Subpart 13.2—Actions at or Below the

Micro-Purchase Threshold

13.201 General.

(a) Agency heads are encouraged to

delegate micro-purchase authority (see

1.603–3).

(b) The Governmentwide commercial

purchase card shall be the preferred

method to purchase and to pay for

micro-purchases (see 2.101).

(c) Purchases at or below the micropurchase threshold may be conducted

using any of the methods described in

subpart 13.3, provided the purchaser is

authorized and trained, pursuant to

agency procedures, to use those

methods.

(d) Micro-purchases do not require

provisions or clauses, except as

provided at 32.1103. This paragraph

takes precedence over any other FAR

requirement to the contrary, but does

not prohibit the use of any clause.

(e) The requirements in part 8 apply

to purchases at or below the micropurchase threshold.

13.202 Purchase guidelines.

(a) Solicitation, evaluation of

quotations, and award. (1) To the extent

practicable, micro-purchases shall be

distributed equitably among qualified

suppliers.

(2) Micro-purchases may be awarded

without soliciting competitive

quotations if the contracting officer or

individual appointed in accordance

with 1.603–3(b) considers the price to

be reasonable.

(3) The administrative cost of

verifying the reasonableness of the price

for purchases may more than offset

potential savings from detecting

instances of overpricing. Therefore,

action to verify price reasonableness

need only be taken if—

(i) The contracting officer or

individual appointed in accordance

with 1.603–3(b) suspects or has

information to indicate that the price

may not be reasonable (e.g., comparison

to the previous price paid or personal

knowledge of the supply or service); or

(ii) Purchasing a supply or service for

which no comparable pricing

information is readily available (e.g., a

supply or service that is not the same as,

or is not similar to, other supplies or

services that have recently been

purchased on a competitive basis).

(b) Documentation. If competitive

quotations were solicited and award

was made to other than the low quoter,

documentation to support the purchase

may be limited to identification of the

solicited concerns and an explanation

for the award decision.

Subpart 13.3—Simplified Acquisition

Methods

13.301 Governmentwide commercial

purchase card.

(a) The Governmentwide commercial

purchase card is authorized for use in

making and/or paying for purchases of

supplies, services, or construction. The

Governmentwide commercial purchase

card may be used by contracting officers

and other individuals designated in

accordance with 1.603–3. The card may
64922 Federal Register / Vol. 62, No. 236 / Tuesday, December 9, 1997 / Rules and Regulations

be used only for purchases that are

otherwise authorized by law or

regulation.

(b) Agencies using the

Governmentwide commercial purchase

card shall establish procedures for use

and control of the card that comply with

the Treasury Financial Manual for

Guidance of Departments and Agencies

(TFM 4–4500) and that are consistent

with the terms and conditions of the

GSA Federal Supply Service Contract

Guide for Governmentwide Commercial

Purchase Card Service. Agency

procedures should not limit the use of

the Governmentwide commercial

purchase card to micro-purchases.

Agency procedures should encourage

use of the card in greater dollar amounts

by contracting officers to place orders

and to pay for purchases against

contracts established under part 8

procedures, when authorized; and to

place orders and/or make payment

under other contractual instruments,

when agreed to by the contractor.

(c) The Governmentwide commercial

purchase card may be used to—

(1) Make micro-purchases;

(2) Place a task or delivery order (if

authorized in the basic contract, basic

ordering agreement, or blanket purchase

agreement); or

(3) Make payments, when the

contractor agrees to accept payment by

the card.

13.302 Purchase orders.

13.302–1 General.

(a) Except as provided under the

unpriced purchase order method (see

13.302–2), purchase orders generally are

issued on a fixed-price basis. See 12.207

for acquisition of commercial items.

(b) Purchase orders shall—

(1) Specify the quantity of supplies or

scope of services ordered;

(2) Contain a determinable date by

which delivery of the supplies or

performance of the services is required;

(3) Provide for inspection as

prescribed in part 46. Generally,

inspection and acceptance should be at

destination. Source inspection should

be specified only if required by part 46.

When inspection and acceptance will be

performed at destination, advance

copies of the purchase order or

equivalent notice shall be furnished to

the consignee(s) for material receipt

purposes. Receiving reports shall be

accomplished immediately upon receipt

and acceptance of supplies;

(4) Specify f.o.b. destination for

supplies to be delivered within the

United States, except Alaska or Hawaii,

unless there are valid reasons to the

contrary; and

(5) Include any trade and prompt

payment discounts that are offered,

consistent with the applicable

principles at 14.408–3.

(c) The contracting officer’s signature

on purchase orders shall be in

accordance with 4.101 and the

definitions at 2.101. Facsimile and

electronic signature may be used in the

production of purchase orders by

automated methods.

(d) Limit the distribution of copies of

purchase orders and related forms to the

minimum deemed essential for

administration and transmission of

contractual information.

(e) In accordance with 31 U.S.C. 3332,

electronic funds transfer (EFT) may be

required for payments. See 32.1103 for

instructions for use of the appropriate

clause in purchase orders. When

obtaining verbal quotes, the contracting

officer shall inform the quoter of the

EFT clause that will be in any resulting

purchase order. Contracting officers

shall not accept EFT payment data. The

contractor shall provide all such data

directly to the payment office.

13.302–2 Unpriced purchase orders.

(a) An unpriced purchase order is an

order for supplies or services, the price

of which is not established at the time

of issuance of the order.

(b) An unpriced purchase order may

be used only when—

(1) It is impractical to obtain pricing

in advance of issuance of the purchase

order; and

(2) The purchase is for—

(i) Repairs to equipment requiring

disassembly to determine the nature and

extent of repairs;

(ii) Material available from only one

source and for which cost cannot

readily be established; or

(iii) Supplies or services for which

prices are known to be competitive, but

exact prices are not known (e.g.,

miscellaneous repair parts, maintenance

agreements).

(c) Unpriced purchase orders may be

issued on paper or electronically. A

realistic monetary limitation, either for

each line item or for the total order,

shall be placed on each unpriced

purchase order. The monetary limitation

shall be an obligation subject to

adjustment when the firm price is

established. The contracting office shall

follow up on each order to ensure

timely pricing. The contracting officer

or the contracting officer’s designated

representative shall review the invoice

price and, if reasonable (see 13.106–

3(a)), process the invoice for payment.

13.302–3 Obtaining contractor acceptance

and modifying purchase orders.

(a) When it is desired to consummate

a binding contract between the parties

before the contractor undertakes

performance, the contracting officer

shall require written (see 2.101)

acceptance of the purchase order by the

contractor.

(b) Each purchase order modification

shall identify the order it modifies and

shall contain an appropriate

modification number.

(c) A contractor’s written acceptance

of a purchase order modification may be

required only if—

(1) Determined by the contracting

officer to be necessary to ensure the

contractor’s compliance with the

purchase order as revised; or

(2) Required by agency regulations.

13.302–4 Termination or cancellation of

purchase orders.

(a) If a purchase order that has been

accepted in writing by the contractor is

to be terminated, the contracting officer

shall process the termination in

accordance with—

(1) 12.403(d) and 52.212–4(l) for

commercial items; or

(2) Part 49 or 52.213–4 for other than

commercial items.

(b) If a purchase order that has not

been accepted in writing by the

contractor is to be canceled, the

contracting officer shall notify the

contractor in writing that the purchase

order has been canceled, request the

contractor’s written acceptance of the

cancellation, and proceed as follows:

(1) If the contractor accepts the

cancellation and does not claim that

costs were incurred as a result of

beginning performance under the

purchase order, no further action is

required (i.e., the purchase order shall

be considered canceled).

(2) If the contractor does not accept

the cancellation or claims that costs

were incurred as a result of beginning

performance under the purchase order,

the contracting officer shall process the

termination action as prescribed in

paragraph (a) of this subsection.

13.302–5 Clauses.

(a) Each purchase order (and each

purchase order modification (see

13.302–3)) shall incorporate all clauses

prescribed for the particular acquisition.

(b) The contracting officer shall insert

the clause at 52.213–2, Invoices, in

purchase orders that authorize advance

payments (see 31 U.S.C. 3324(d)(2)) for

subscriptions or other charges for

newspapers, magazines, periodicals, or

other publications (i.e., any publication

printed, microfilmed, photocopied, or
Federal Register / Vol. 62, No. 236 / Tuesday, December 9, 1997 / Rules and Regulations 64923

magnetically or otherwise recorded for

auditory or visual usage).

(c) The contracting officer shall insert

the clause at 52.213–3, Notice to

Supplier, in unpriced purchase orders.

(d) The contracting officer may use

the clause at 52.213-4, Terms and

Conditions—Simplified Acquisitions

(Other Than Commercial Items), in

simplified acquisitions exceeding the

micro-purchase threshold that are for

other than commercial items (see

12.301). The clause—

(1) Is a compilation of the most

commonly used clauses that apply to

simplified acquisitions; and

(2) May be modified to fit the

individual acquisition to add other

needed clauses, or those clauses may be

added separately. Modifications (i.e.,

additions, deletions, or substitutions)

must not create a void or internal

contradiction in the clause. For

example, do not add an inspection and

acceptance or termination for

convenience requirement unless the

existing requirement is deleted. Also, do

not delete a paragraph without

providing for an appropriate substitute.

13.303 Blanket purchase agreements

(BPAs).

13.303–1 General.

(a) A blanket purchase agreement

(BPA) is a simplified method of filling

anticipated repetitive needs for supplies

or services by establishing ‘‘charge

accounts’’ with qualified sources of

supply (see subpart 16.7 for additional

coverage of agreements).

(b) BPAs should be established for use

by an organization responsible for

providing supplies for its own

operations or for other offices,

installations, projects, or functions.

Such organizations, for example, may be

organized supply points, separate

independent or detached field parties,

or one-person posts or activities.

(c) The use of BPAs does not exempt

an agency from the responsibility for

keeping obligations and expenditures

within available funds.

13.303–2 Establishment of BPAs.

(a) The following are circumstances

under which contracting officers may

establish BPAs:

(1) There is a wide variety of items in

a broad class of supplies or services that

are generally purchased, but the exact

items, quantities, and delivery

requirements are not known in advance

and may vary considerably.

(2) There is a need to provide

commercial sources of supply for one or

more offices or projects in a given area

that do not have or need authority to

purchase otherwise.

(3) The use of this procedure would

avoid the writing of numerous purchase

orders.

(4) There is no existing requirements

contract for the same supply or service

that the contracting activity is required

to use.

(b) After determining a BPA would be

advantageous, contracting officers

shall—

(1) Establish the parameters to limit

purchases to individual items or

commodity groups or classes, or permit

the supplier to furnish unlimited

supplies or services; and

(2) Consider suppliers whose past

performance has shown them to be

dependable, who offer quality supplies

or services at consistently lower prices,

and who have provided numerous

purchases at or below the simplified

acquisition threshold.

(c) BPAs may be established with—

(1) More than one supplier for

supplies or services of the same type to

provide maximum practicable

competition;

(2) A single firm from which

numerous individual purchases at or

below the simplified acquisition

threshold will likely be made in a given

period; or

(3) Federal Supply Schedule

contractors, if not inconsistent with the

terms of the applicable schedule

contract.

(d) BPAs should be prepared without

a purchase requisition and only after

contacting suppliers to make the

necessary arrangements for—

(1) Securing maximum discounts;

(2) Documenting individual purchase

transactions;

(3) Periodic billings; and

(4) Incorporating other necessary

details.

13.303–3 Preparation of BPAs.

Prepare BPAs on the forms specified

in 13.307. Do not cite accounting and

appropriation data (see 13.303–5(e)(4)).

(a) The following terms and

conditions are mandatory:

(1) Description of agreement. A

statement that the supplier shall furnish

supplies or services, described in

general terms, if and when requested by

the contracting officer (or the authorized

representative of the contracting officer)

during a specified period and within a

stipulated aggregate amount, if any.

(2) Extent of obligation. A statement

that the Government is obligated only to

the extent of authorized purchases

actually made under the BPA.

(3) Purchase limitation. A statement

that specifies the dollar limitation for

each individual purchase under the

BPA (see 13.303–5(b)).

(4) Individuals authorized to purchase

under the BPA. A statement that a list

of individuals authorized to purchase

under the BPA, identified either by title

of position or by name of individual,

organizational component, and the

dollar limitation per purchase for each

position title or individual shall be

furnished to the supplier by the

contracting officer.

(5) Delivery tickets. A requirement

that all shipments under the agreement,

except those for newspapers, magazines,

or other periodicals, shall be

accompanied by delivery tickets or sales

slips that shall contain the following

minimum information:

(i) Name of supplier.

(ii) BPA number.

(iii) Date of purchase.

(iv) Purchase number.

(v) Itemized list of supplies or

services furnished.

(vi) Quantity, unit price, and

extension of each item, less applicable

discounts (unit prices and extensions

need not be shown when incompatible

with the use of automated systems,

provided that the invoice is itemized to

show this information).

(vii) Date of delivery or shipment.

(6) Invoices. One of the following

statements shall be included (except

that the statement in paragraph (a)(6)(iii)

of this subsection should not be used if

the accumulation of the individual

invoices by the Government materially

increases the administrative costs of this

purchase method):

(i) A summary invoice shall be

submitted at least monthly or upon

expiration of this BPA, whichever

occurs first, for all deliveries made

during a billing period, identifying the

delivery tickets covered therein, stating

their total dollar value, and supported

by receipt copies of the delivery tickets.

(ii) An itemized invoice shall be

submitted at least monthly or upon

expiration of this BPA, whichever

occurs first, for all deliveries made

during a billing period and for which

payment has not been received. These

invoices need not be supported by

copies of delivery tickets.

(iii) When billing procedures provide

for an individual invoice for each

delivery, these invoices shall be

accumulated, provided that—

(A) A consolidated payment will be

made for each specified period; and

(B) The period of any discounts will

commence on the final date of the

billing period or on the date of receipt

of invoices for all deliveries accepted

during the billing period, whichever is

later.

(iv) An invoice for subscriptions or

other charges for newspapers,
64924 Federal Register / Vol. 62, No. 236 / Tuesday, December 9, 1997 / Rules and Regulations

magazines, or other periodicals shall

show the starting and ending dates and

shall state either that ordered

subscriptions have been placed in effect

or will be placed in effect upon receipt

of payment.

(b) If the fast payment procedure is

used, include the requirements stated in

13.403.

13.303–4 Clauses.

(a) The contracting officer shall insert

in each BPA the clauses prescribed

elsewhere in this part that are required

for or applicable to the particular BPA.

(b) Unless a clause prescription

specifies otherwise (e.g., see 22.305(a),

22.605(a)(5), or 22.1006), if the

prescription includes a dollar threshold,

the amount to be compared to that

threshold is that of any particular order

under the BPA.

13.303–5 Purchases under BPAs.

(a) Use a BPA only for purchases that

are otherwise authorized by law or

regulation.

(b) Individual purchases shall not

exceed the simplified acquisition

threshold. However, agency regulations

may establish a higher threshold

consistent with the following:

(1) The simplified acquisition

threshold and the $5,000,000 limitation

for individual purchases do not apply to

BPAs established in accordance with

13.303–2(c)(3).

(2) The limitation for individual

purchases for commercial item

acquisitions conducted under subpart

13.5 is $5,000,000.

(c) The existence of a BPA does not

justify purchasing from only one source

or avoiding small business set-asides.

The requirements of 13.003(b) and

subpart 19.5 also apply to each order.

(d) If, for a particular purchase greater

than the micro-purchase threshold,

there is an insufficient number of BPAs

to ensure maximum practicable

competition, the contracting officer

shall—

(1) Solicit quotations from other

sources (see 13.105) and make the

purchase as appropriate; and

(2) Establish additional BPAs to

facilitate future purchases if—

(i) Recurring requirements for the

same or similar supplies or services

seem likely;

(ii) Qualified sources are willing to

accept BPAs; and

(iii) It is otherwise practical to do so.

(e) Limit documentation of purchases

to essential information and forms as

follows:

(1) Purchases generally should be

made electronically, or orally when it is

not considered economical or practical

to use electronic methods.

(2) A paper purchase document may

be issued if necessary to ensure that the

supplier and the purchaser agree

concerning the transaction.

(3) Unless a paper document is

issued, record essential elements (e.g.,

date, supplier, supplies or services,

price, delivery date) on the purchase

requisition, in an informal

memorandum, or on a form developed

locally for the purpose.

(4) Cite the pertinent purchase

requisitions and the accounting and

appropriation data.

(5) When delivery is made or the

services are performed, the supplier’s

sales document, delivery document, or

invoice may (if it reflects the essential

elements) be used for the purpose of

recording receipt and acceptance of the

supplies or services. However, if the

purchase is assigned to another activity

for administration, the authorized

Government representative shall

document receipt and acceptance of

supplies or services by signing and

dating the agency specified form after

verification and after notation of any

exceptions.

13.303–6 Review procedures.

(a) The contracting officer placing

orders under a BPA, or the designated

representative of the contracting officer,

shall review a sufficient random sample

of the BPA files at least annually to

ensure that authorized procedures are

being followed.

(b) The contracting officer that

entered into the BPA shall—

(1) Ensure that each BPA is reviewed

at least annually and, if necessary,

updated at that time; and

(2) Maintain awareness of changes in

market conditions, sources of supply,

and other pertinent factors that may

warrant making new arrangements with

different suppliers or modifying existing

arrangements.

(c) If an office other than the

purchasing office that established a BPA

is authorized to make purchases under

that BPA, the agency that has

jurisdiction over the office authorized to

make the purchases shall ensure that the

procedures in paragraph (a) of this

subsection are being followed.

13.303–7 Completion of BPAs.

An individual BPA is considered

complete when the purchases under it

equal its total dollar limitation, if any,

or when its stated time period expires.

13.303–8 Optional clause.

The clause at 52.213–4, Terms and

Conditions—Simplified Acquisitions

(Other Than Commercial Items), may be

used in BPAs established under this

section.

13.304 [Reserved]

13.305 Imprest funds and third party

drafts.

13.305–1 General.

Imprest funds and third party drafts

may be used to acquire and to pay for

supplies or services. Policies and

regulations concerning the

establishment of and accounting for

imprest funds and third party drafts,

including the responsibilities of

designated cashiers and alternates, are

contained in Part IV of the Treasury

Financial Manual for Guidance of

Departments and Agencies, Title 7 of

the General Accounting Office Policy

and Procedures Manual for Guidance of

Federal Agencies, and the agency

implementing regulations. Agencies also

shall be guided by the Manual of

Procedures and Instructions for

Cashiers, issued by the Financial

Management Service, Department of the

Treasury.

13.305–2 Agency responsibilities.

Each agency using imprest funds and

third party drafts shall—

(a) Periodically review and determine

whether there is a continuing need for

each fund or third party draft account

established, and that amounts of those

funds or accounts are not in excess of

actual needs;

(b) Take prompt action to have

imprest funds or third party draft

accounts adjusted to a level

commensurate with demonstrated needs

whenever circumstances warrant such

action; and

(c) Develop and issue appropriate

implementing regulations. These

regulations shall include (but are not

limited to) procedures covering—

(1) Designation of personnel

authorized to make purchases using

imprest funds or third party drafts; and

(2) Documentation of purchases using

imprest funds or third party drafts,

including documentation of—

(i) Receipt and acceptance of supplies

and services by the Government;

(ii) Receipt of cash or third party draft

payments by the suppliers; and

(iii) Cash advances and

reimbursements.

13.305–3 Conditions for use.

Imprest funds or third party drafts

may be used for purchases when—

(a) The imprest fund transaction does

not exceed $500 or such other limits as

have been approved by the agency head;

(b) The third party draft transaction

does not exceed $2,500, unless

authorized at a higher level in

accordance with Treasury restrictions;
Federal Register / Vol. 62, No. 236 / Tuesday, December 9, 1997 / Rules and Regulations 64925

(c) The use of imprest funds or third

party drafts is considered to be

advantageous to the Government; and

(d) The use of imprest funds or third

party drafts for the transaction

otherwise complies with any additional

conditions established by agencies and

with the policies and regulations

referenced in 13.305–1.

13.305–4 Procedures.

(a) Each purchase using imprest funds

or third party drafts shall be based upon

an authorized purchase requisition,

contracting officer verification

statement, or other agency approved

method of ensuring that adequate funds

are available for the purchase.

(b) Normally, purchases should be

placed orally and without soliciting

competition if prices are considered

reasonable.

(c) Since there is, for all practical

purposes, simultaneous placement of

the order and delivery of the items,

clauses are not required for purchases

using imprest funds or third party

drafts.

(d) Forms prescribed at 13.307(e) may

be used if a written order is considered

necessary (e.g., if required by the

supplier for discount, tax exemption, or

other reasons). If a purchase order is

used, endorse it ‘‘Payment to be made

from Imprest Fund’’ (or ‘‘Payment to be

made from Third Party Draft,’’ as

appropriate).

(e) The individual authorized to make

purchases using imprest funds or third

party drafts shall—

(1) Furnish to the imprest fund or

third party draft cashier a copy of the

document required under paragraph (a)

of this subsection annotated to reflect—

(i) That an imprest fund or third party

draft purchase has been made;

(ii) The unit prices and extensions;

and

(iii) The supplier’s name and address;

and

(2) Require the supplier to include

with delivery of the supplies an invoice,

packing slip, or other sales instrument

giving—

(i) The supplier’s name and address;

(ii) List and quantity of items

supplied;

(iii) Unit prices and extensions; and

(iv) Cash discount, if any.

13.306 SF 44, Purchase Order—Invoice—

Voucher.

The SF 44, Purchase Order—

Invoice—Voucher, is a multipurpose

pocket-size purchase order form

designed primarily for on-the-spot, overthe-counter purchases of supplies and

nonpersonal services while away from

the purchasing office or at isolated

activities. It also can be used as a

receiving report, invoice, and public

voucher.

(a) This form may be used if all of the

following conditions are satisfied:

(1) The amount of the purchase is at

or below the micro-purchase threshold,

except for purchases made under

unusual and compelling urgency or in

support of contingency operations.

Agencies may establish higher dollar

limitations for specific activities or

items;

(2) The supplies or services are

immediately available;

(3) One delivery and one payment

will be made; and

(4) Its use is determined to be more

economical and efficient than use of

other simplified acquisition procedures.

(b) General procedural instructions

governing the form’s use are printed on

the form and on the inside front cover

of each book of forms.

(c) Since there is, for all practical

purposes, simultaneous placement of

the order and delivery of the items,

clauses are not required for purchases

using this form.

(d) Agencies shall provide adequate

safeguards regarding the control of

forms and accounting for purchases.

13.307 Forms.

(a) Commercial items. For use of the

SF 1449, Solicitation/Contract/Order for

Commercial Items, see 12.204.

(b) Other than commercial items.

(1) Except when quotations are

solicited via FACNET, other electronic

means, or orally, the SF 1449; SF 18,

Request for Quotations; or an agency

form/automated format may be used.

Each agency request for quotations

form/automated format should conform

with the SF 18 or SF 1449 to the

maximum extent practicable.

(2) Both SF 1449 and OF 347, Order

for Supplies or Services, are

multipurpose forms used for negotiated

purchases of supplies or services,

delivery or task orders, inspection and

receiving reports, and invoices. An

agency form/automated format also may

be used.

(c) Forms used for both commercial

and other than commercial items.

(1) OF 336, Continuation Sheet, or an

agency form/automated format may be

used when additional space is needed.

(2) OF 348, Order for Supplies or

Services Schedule—Continuation, or an

agency form/automated format may be

used for negotiated purchases when

additional space is needed. Agencies

may print on these forms the clauses

considered to be generally suitable for

purchases.

(3) SF 30, Amendment of Solicitation/

Modification of Contract, or a purchase

order form may be used to modify a

purchase order, unless an agency form/

automated format is prescribed in

agency regulations.

(d) SF 44, Purchase Order—Invoice—

Voucher, is a multipurpose pocket-size

purchase order form that may be used

as outlined in 13.306.

(e) SF 1165, Receipt for Cash—

Subvoucher, or an agency purchase

order form may be used for purchases

using imprest funds or third party

drafts.

Subpart 13.4—Fast Payment

Procedure

13.401 General.

(a) The fast payment procedure allows

payment under limited conditions to a

contractor prior to the Government’s

verification that supplies have been

received and accepted. The procedure

provides for payment for supplies based

on the contractor’s submission of an

invoice that constitutes a certification

that the contractor—

(1) Has delivered the supplies to a

post office, common carrier, or point of

first receipt by the Government; and

(2) Shall replace, repair, or correct

supplies not received at destination,

damaged in transit, or not conforming to

purchase agreements.

(b) The contracting officer shall be

primarily responsible for collecting

debts resulting from failure of

contractors to properly replace, repair,

or correct supplies lost, damaged, or not

conforming to purchase requirements

(see 32.605(b) and 32.606).

13.402 Conditions for use.

If the conditions in paragraphs (a)

through (f) of this section are present,

the fast payment procedure may be

used, provided that use of the procedure

is consistent with the other conditions

of the purchase. The conditions for use

of the fast payment procedure are as

follows:

(a) Individual purchasing instruments

do not exceed $25,000, except that

executive agencies may permit higher

dollar limitations for specified activities

or items on a case-by-case basis.

(b) Deliveries of supplies are to occur

at locations where there is both a

geographical separation and a lack of

adequate communications facilities

between Government receiving and

disbursing activities that will make it

impractical to make timely payment

based on evidence of Government

acceptance.

(c) Title to the supplies passes to the

Government—

(1) Upon delivery to a post office or

common carrier for mailing or shipment

to destination; or
64926 Federal Register / Vol. 62, No. 236 / Tuesday, December 9, 1997 / Rules and Regulations

(2) Upon receipt by the Government if

the shipment is by means other than

Postal Service or common carrier.

(d) The supplier agrees to replace,

repair, or correct supplies not received

at destination, damaged in transit, or not

conforming to purchase requirements.

(e) The purchasing instrument is a

firm-fixed-price contract, a purchase

order, or a delivery order for supplies.

(f) A system is in place to ensure—

(1) Documentation of evidence of

contractor performance under fast

payment purchases;

(2) Timely feedback to the contracting

officer in case of contractor deficiencies;

and

(3) Identification of suppliers that

have a current history of abusing the fast

payment procedure (also see subpart

9.1).

13.403 Preparation and execution of

orders.

Priced or unpriced contracts,

purchase orders, or BPAs using the fast

payment procedure shall include the

following:

(a) A requirement that the supplies be

shipped transportation or postage

prepaid.

(b) A requirement that invoices be

submitted directly to the finance or

other office designated in the order, or

in the case of unpriced purchase orders,

to the contracting officer (see 13.302–

2(c)).

(c) The following statement on the

consignee’s copy:

Consignee’s Notification to Purchasing

Activity of Nonreceipt, Damage, or

Nonconformance

The consignee shall notify the

purchasing office promptly after the

specified date of delivery of supplies

not received, damaged in transit, or not

conforming to specifications of the

purchase order. Unless extenuating

circumstances exist, the notification

should be made not later than 60 days

after the specified date of delivery.

13.404 Contract clause.

The contracting officer shall insert the

clause at 52.213–1, Fast Payment

Procedure, in solicitations and contracts

when the conditions in 13.402 are

applicable and it is intended that the

fast payment procedure be used in the

contract (in the case of BPAs, the

contracting officer may elect to insert

the clause either in the BPA or in orders

under the BPA).

Subpart 13.5—Test Program for

Certain Commercial Items

13.500 General.

(a) This subpart authorizes, as a test

program, use of simplified procedures

for the acquisition of supplies and

services in amounts greater than the

simplified acquisition threshold but not

exceeding $5,000,000, including

options, if the contracting officer

reasonably expects, based on the nature

of the supplies or services sought, and

on market research, that offers will

include only commercial items.

Under this test program, contracting

officers may use any simplified

acquisition procedure in this part,

subject to any specific dollar limitation

applicable to the particular procedure.

The purpose of this test program is to

vest contracting officers with additional

procedural discretion and flexibility, so

that commercial item acquisitions in

this dollar range may be solicited,

offered, evaluated, and awarded in a

simplified manner that maximizes

efficiency and economy and minimizes

burden and administrative costs for both

the Government and industry (10 U.S.C.

2304(g) and 2305 and 41 U.S.C. 253(g)

and 253a and 253b).

(b) For the period of this test,

contracting activities shall employ the

simplified procedures authorized by the

test to the maximum extent practicable.

(c) When acquiring commercial items

using the procedures in this part, the

requirements of part 12 apply subject to

the order of precedence provided at

12.102(c). This includes use of the

provisions and clauses in subpart 12.3.

(d) The authority to issue solicitations

under this subpart shall expire on

January 1, 2000. Contracts may be

awarded after the expiration of this

authority for solicitations issued before

the expiration of the authority.

13.501 Special documentation

requirements.

(a) Sole source acquisitions. (1)

Acquisitions conducted under

simplified acquisition procedures are

exempt from the requirements in part 6.

However, contracting officers shall—

(i) Conduct sole source acquisitions,

as defined in 6.003, under this subpart

only if the need to do so is justified in

writing and approved at the levels

specified in paragraphs (a)(2)(i) and

(a)(2)(ii) of this section; and

(ii) Prepare sole source justifications

using the format at 6.303–2, modified to

reflect an acquisition under the

authority of the test program for

commercial items (section 4202 of the

Clinger-Cohen Act of 1996).

(2) Justifications and approvals are

required under this subpart only for sole

source acquisitions.

(i) For a proposed contract exceeding

$100,000, but not exceeding $500,000,

the contracting officer’s certification

that the justification is accurate and

complete to the best of the contracting

officer’s knowledge and belief will serve

as approval, unless a higher approval

level is established in accordance with

agency procedures.

(ii) For a proposed contract exceeding

$500,000, the approval shall be by the

competition advocate for the procuring

activity, designated pursuant to 6.501;

or an official described in 6.304(a)(3) or

(a)(4). This authority is not delegable.

(b) Contract file documentation. The

contract file shall include—

(1) A brief written description of the

procedures used in awarding the

contract, including the fact that the test

procedures in FAR subpart 13.5 were

used;

(2) The number of offers received;

(3) An explanation, tailored to the size

and complexity of the acquisition, of the

basis for the contract award decision;

and

(4) Any justification approved under

paragraph (a) of this section.

PART 16—TYPES OF CONTRACTS

16.701 [Amended]

9. Section 16.701 is amended in the

parenthetical by revising ‘‘subpart 13.2’’

to read ‘‘13.303’’.

16.703 [Amended]

10. Section 16.703 is amended in

paragraph (c)(1)(vi) by revising the

citation ‘‘13.303’’ to read ‘‘13.403’’.

PART 19—SMALL BUSINESS

PROGRAMS

19.1006 [Amended]

11. Section 19.1006 is amended in

paragraph (c)(1)(i) by removing ‘‘13.105

or’’.

PART 32—CONTRACT FINANCING

32.1103 [Amended]

12. Section 32.1103 is amended in

paragraph (a)(1) by revising the

reference ‘‘13.103(e)’’ to read

‘‘13.003(f)’’ and in paragraph (b)(2) by

revising ‘‘13.103(e)’’ to read ‘‘13.301’’.

PART 41—ACQUISITION OF UTILITY

SERVICES

41.202 [Amended]

13. Section 41.202 is amended in

paragraph (c)(1) by revising the

reference ‘‘subpart 13.5’’ to read

‘‘13.302’’.

PART 43—CONTRACT

MODIFICATIONS

43.301 [Amended]

14. Section 43.301 is amended in

paragraph (a)(2)(iii) by revising the

reference ‘‘13.503’’ to read ‘‘13.302–3’’.
Federal Register / Vol. 62, No. 236 / Tuesday, December 9, 1997 / Rules and Regulations 64927

PART 49—TERMINATION OF

CONTRACTS

49.002 [Amended]

15. Section 49.002 is amended in

paragraph (a) by revising the reference

‘‘13.504(b)’’ to read ‘‘13.302–4’’.

16. Section 49.501 is amended by

adding the following text as the second

sentence:

49.501 General.

* * * This subpart does not apply to

contracts that use the clause at 52.213–

4, Terms and Conditions—Simplified

Acquisitions (Other Than Commercial

Items). * * *

* * * * *

PART 52—SOLICITATION PROVISIONS

AND CONTRACT CLAUSES

52.101 [Amended]

17. Section 52.101 is amended in

paragraph (e)(2)(i) by removing the

semicolon after the word ‘‘authorized’’

and replacing it with ‘‘(see 52.102);’’.

18. Section 52.102 is revised to read

as follows:

52.102 Incorporating provisions and

clauses.

(a) Provisions and clauses should be

incorporated by reference to the

maximum practical extent, rather than

being incorporated in full text, even if

they—

(1) Are used with one or more

alternates or on an optional basis;

(2) Are prescribed on a ‘‘substantially

as follows’’ or ‘‘substantially the same

as’’ basis, provided they are used

verbatim;

(3) Require modification or the

insertion by the Government of fill-in

material (see 52.104); or

(4) Require completion by the offeror

or prospective contractor. This

instruction also applies to provisions

completed as annual representations

and certifications.

(b) Except for provisions and clauses

prescribed in 52.107, any provision or

clause that can be accessed

electronically by the offeror or

prospective contractor may be

incorporated by reference in

solicitations and/or contracts. However,

the contracting officer, upon request,

shall provide the full text of any

provision or clause incorporated by

reference.

(c) Agency approved provisions and

clauses prescribed in agency acquisition

regulations, and provisions and clauses

not authorized by subpart 52.3 to be

incorporated by reference, need not be

incorporated in full text, provided the

contracting officer includes in the

solicitation and contract a statement

that—

(1) Identifies all provisions and

clauses that require completion by the

offeror or prospective contractor;

(2) Specifies that the provisions and

clauses must be completed by the

offeror or prospective contractor and

must be submitted with the quotation or

offer; and

(3) Identifies to the offeror or

prospective contractor at least one

electronic address where the full text

may be accessed.

(d) An agency may develop a group

listing of provisions and clauses that

apply to a specific category of contracts.

An agency group listing may be

incorporated by reference in

solicitations and/or contracts in lieu of

citing the provisions and clauses

individually, provided the group listing

is made available electronically to

offerors and prospective contractors.

(e) A provision or clause that is not

available electronically to offerors and

prospective contractors shall be

incorporated in solicitations and/or

contracts in full text if it is—

(1) A FAR provision or clause that

otherwise is not authorized to be

incorporated by reference (see subpart

52.3); or

(2) A provision or clause prescribed

for use in an agency acquisition

regulation.

(f) Provisions or clauses may not be

incorporated by reference by being

listed in the—

(1) Provision at 52.252–3, Alterations

in Solicitations; or

(2) Clause at 52.252–4, Alterations in

Contract.

52.102–1 and 52.102–2 [Removed]

19. Sections 52.102–1 and 52.102–2

are removed.

20. Section 52.213–1 is revised to read

as follows:

52.213–1 Fast Payment Procedure.

As prescribed in 13.404, insert the

following clause:

Fast Payment Procedure (Feb 1998)

(a) General. The Government will pay

invoices based on the Contractor’s delivery to

a post office or common carrier (or, if

shipped by other means, to the point of first

receipt by the Government).

(b) Responsibility for supplies. (1) Title to

the supplies passes to the Government upon

delivery to—

(i) A post office or common carrier for

shipment to the specific destination; or

(ii) The point of first receipt by the

Government, if shipment is by means other

than Postal Service or common carrier.

(2) Notwithstanding any other provision of

the contract, order, or blanket purchase

agreement, the Contractor shall—

(i) Assume all responsibility and risk of

loss for supplies not received at destination,

damaged in transit, or not conforming to

purchase requirements; and

(ii) Replace, repair, or correct those

supplies promptly at the Contractor’s

expense, if instructed to do so by the

Contracting Officer within 180 days from the

date title to the supplies vests in the

Government.

(c) Preparation of invoice. (1) Upon

delivery to a post office or common carrier

(or, if shipped by other means, the point of

first receipt by the Government), the

Contractor shall—

(i) Prepare an invoice as provided in this

contract, order, or blanket purchase

agreement; and

(ii) Display prominently on the invoice

‘‘FAST PAY.’’

(2) If the purchase price excludes the cost

of transportation, the Contractor shall enter

the prepaid shipping cost on the invoice as

a separate item. The Contractor shall not

include the cost of parcel post insurance. If

transportation charges are stated separately

on the invoice, the Contractor shall retain

related paid freight bills or other

transportation billings paid separately for a

period of 3 years and shall furnish the bills

to the Government upon request.

(3) If this contract, order, or blanket

purchase agreement requires the preparation

of a receiving report, the Contractor shall

prepare the receiving report on the

prescribed form or, alternatively, shall

include the following information on the

invoice, in addition to that required in

paragraph (c)(1) of this clause:

(i) A statement in prominent letters ‘‘NO

RECEIVING REPORT PREPARED.’’

(ii) Shipment number.

(iii) Mode of shipment.

(iv) At line item level—

(A) National stock number and/or

manufacturer’s part number;

(B) Unit of measure;

(C) Ship-To Point;

(D) Mark-For Point, if in the contract; and

(E) FEDSTRIP/MILSTRIP document

number, if in the contract.

(4) If this contract, order, or blanket

purchase agreement does not require

preparation of a receiving report on a

prescribed form, the Contractor shall include

on the invoice the following information at

the line item level, in addition to that

required in paragraph (c)(1) of this clause:

(i) Ship-To Point.

(ii) Mark-For Point.

(iii) FEDSTRIP/MILSTRIP document

number, if in the contract.

(5) Where a receiving report is not

required, the Contractor shall include a copy

of the invoice in each shipment.

(d) Certification of invoice. The Contractor

certifies by submitting an invoice to the

Government that the supplies being billed to

the Government have been shipped or

delivered in accordance with shipping

instructions issued by the ordering officer, in

the quantities shown on the invoice, and that

the supplies are in the quantity and of the

quality designated by the contract, order, or

blanket purchase agreement.
64928 Federal Register / Vol. 62, No. 236 / Tuesday, December 9, 1997 / Rules and Regulations

(e) Fast pay container identification. The

Contractor shall mark all outer shipping

containers ‘‘FAST PAY.’’

(End of clause)

52.213–2 [Amended]

21. Section 52.213–2 is amended in the

introductory text by revising the reference

‘‘13.506(b)’’ to read ‘‘13.302–5(b)’’.

52.213–3 [Amended]

22. Section 52.213–3 is amended in

the introductory text by revising the

reference ‘‘13.506(c)’’ to read ‘‘13.302–

5(c)’’.

23. Section 52.213–4 is added to read

as follows:

52.213–4 Terms and Conditions—

Simplified Acquisitions (Other Than

Commercial Items).

As prescribed in 13.302–5(d), insert

the following clause:

Terms and Conditions—Simplified

Acquisitions (Other Than Commercial Items)

(Feb 1998)

(a) The Contractor shall comply with the

following Federal Acquisition Regulation

(FAR) clauses that are incorporated by

reference:

(1) The clauses listed below implement

provisions of law or Executive order:

(i) 52.222–3, Convict Labor (Aug 1996)

(E.O. 11755).

(ii) 52.233–3, Protest After Award (Aug

1996) (31 U.S.C. 3553).

(2) Listed below are additional clauses that

apply:

(i) 52.225–11, Restrictions on Certain

Foreign Purchases (Oct 1996).

(ii) 52.232–1, Payments (Apr 1984).

(iii) 52.232–8, Discounts for Prompt

Payment (May 1997).

(iv) 52.232–11, Extras (Apr 1984).

(v) 52.232–25, Prompt Payment (Jun 1997).

(vi) 52.232–33, Mandatory Information for

Electronic Funds Transfer Payment (Aug

1996).

(vii) 52.233–1, Disputes (Oct 1995).

(viii) 52.244–6, Subcontracts for

Commercial Items and Commercial

Components (Oct 1995).

(ix) 52.253–1, Computer Generated Forms

(Jan 1991).

(b) The Contractor shall comply with the

following FAR clauses, incorporated by

reference, unless the circumstances do not

apply:

(1) The clauses listed below implement

provisions of law or Executive order:

(i) 52.222–20, Walsh-Healey Public

Contracts Act (DEC 1996) (41 U.S.C. 35–45)

(Applies to supply contracts over $10,000 in

the United States).

(ii) 52.222–26, Equal Opportunity (APR

1984) (E.O. 11246) (Applies to contracts over

$10,000).

(iii) 52.222–35, Affirmative Action for

Special Disabled and Vietnam Era Veterans

(APR 1984) (38 U.S.C. 4212) (Applies to

contracts over $10,000).

(iv) 52.222–36, Affirmative Action for

Handicapped Workers (APR 1984) (29 U.S.C.

793) (Applies to contracts over $2,500).

(v) 52.222–37, Employment Reports on

Special Disabled Veterans and Veterans of

the Vietnam Era (JAN 1988) (38 U.S.C. 4212)

(Applies to contracts over $10,000).

(vi) 52.222–41, Service Contract Act of

1965, As Amended (MAY 1989) (41 U.S.C.

351, et seq.) (Applies to service contracts

over $2,500).

(vii) 52.223–5, Pollution Prevention and

Right-to-Know Information (MAR 1997) (E.O.

12856) (Applies to services performed on

Federal facilities).

(viii) 52.225–3, Buy American Act—

Supplies (JAN 1994) (41 U.S.C. 10) (Applies

to supplies, and to services involving the

furnishing of supplies, if the contract was—

(A) Under $25,000; or

(B) Set aside for small business concerns,

regardless of dollar value).

(2) Listed below are additional clauses that

may apply:

(i) 52.209–6, Protecting the Government’s

Interest When Subcontracting with

Contractors Debarred, Suspended, or

Proposed for Debarment (JULY 1995)

(Applies to contracts over $25,000).

(ii) 52.211–17, Delivery of Excess

Quantities (SEPT 1989) (Applies to fixedprice supplies).

(iii) 52.247–29, F.o.b. Origin (JUN 1988)

(Applies to supplies if delivery is f.o.b.

origin).

(iv) 52.247–34, F.o.b. Destination (NOV

1991) (Applies to supplies if delivery is f.o.b.

destination).

(c) FAR 52.252–2, Clauses Incorporated by

Reference (FEB 1998). This contract

incorporates one or more clauses by

reference, with the same force and effect as

if they were given in full text. Upon request,

the Contracting Officer will make their full

text available. Also, the full text of a clause

may be accessed electronically at this/these

address(es):

lllllllllllllllllllll

lllllllllllllllllllll

[Insert one or more Internet addresses]

(d) Inspection/Acceptance. The Contractor

shall tender for acceptance only those items

that conform to the requirements of this

contract. The Government reserves the right

to inspect or test any supplies or services that

have been tendered for acceptance. The

Government may require repair or

replacement of nonconforming supplies or

reperformance of nonconforming services at

no increase in contract price. The

Government must exercise its postacceptance

rights—

(1) Within a reasonable period of time after

the defect was discovered or should have

been discovered; and

(2) Before any substantial change occurs in

the condition of the item, unless the change

is due to the defect in the item.

(e) Excusable delays. The Contractor shall

be liable for default unless nonperformance

is caused by an occurrence beyond the

reasonable control of the Contractor and

without its fault or negligence, such as acts

of God or the public enemy, acts of the

Government in either its sovereign or

contractual capacity, fires, floods, epidemics,

quarantine restrictions, strikes, unusually

severe weather, and delays of common

carriers. The Contractor shall notify the

Contracting Officer in writing as soon as it is

reasonably possible after the commencement

of any excusable delay, setting forth the full

particulars in connection therewith, shall

remedy such occurrence with all reasonable

dispatch, and shall promptly give written

notice to the Contracting Officer of the

cessation of such occurrence.

(f) Termination for the Government’s

convenience. The Government reserves the

right to terminate this contract, or any part

hereof, for its sole convenience. In the event

of such termination, the Contractor shall

immediately stop all work hereunder and

shall immediately cause any and all of its

suppliers and subcontractors to cease work.

Subject to the terms of this contract, the

Contractor shall be paid a percentage of the

contract price reflecting the percentage of the

work performed prior to the notice of

termination, plus reasonable charges that the

Contractor can demonstrate to the

satisfaction of the Government, using its

standard record keeping system, have

resulted from the termination. The Contractor

shall not be required to comply with the cost

accounting standards or contract cost

principles for this purpose. This paragraph

does not give the Government any right to

audit the Contractor’s records. The

Contractor shall not be paid for any work

performed or costs incurred that reasonably

could have been avoided.

(g) Termination for cause. The Government

may terminate this contract, or any part

hereof, for cause in the event of any default

by the Contractor, or if the Contractor fails to

comply with any contract terms and

conditions, or fails to provide the

Government, upon request, with adequate

assurances of future performance. In the

event of termination for cause, the

Government shall not be liable to the

Contractor for any amount for supplies or

services not accepted, and the Contractor

shall be liable to the Government for any and

all rights and remedies provided by law. If

it is determined that the Government

improperly terminated this contract for

default, such termination shall be deemed a

termination for convenience.

(h) Warranty. The Contractor warrants and

implies that the items delivered hereunder

are merchantable and fit for use for the

particular purpose described in this contract.

(End of clause)

24. Sections 52.252–1 and 52.252–2

are revised to read as follows:

52.252–1 Solicitation Provisions

Incorporated by Reference.

As prescribed in 52.107(a), insert the

following provision:

Solicitation Provisions Incorporated

by Reference (Feb 1998)

This solicitation incorporates one or more

solicitation provisions by reference, with the

same force and effect as if they were given

in full text. Upon request, the Contracting

Officer will make their full text available.

The offeror is cautioned that the listed

provisions may include blocks that must be

completed by the offeror and submitted with

its quotation or offer. In lieu of submitting
Federal Register / Vol. 62, No. 236 / Tuesday, December 9, 1997 / Rules and Regulations 64929

the full text of those provisions, the offeror

may identify the provision by paragraph

identifier and provide the appropriate

information with its quotation or offer. Also,

the full text of a solicitation provision may

be accessed electronically at this/these

address(es):

lllllllllllllllllllll

lllllllllllllllllllll

[Insert one or more Internet addresses]

(End of provision)

52.252–2 Clauses Incorporated by

Reference.

As prescribed in 52.107(b), insert the

following clause:

Clauses Incorporated by Reference (Feb 1998)

This contract incorporates one or more

clauses by reference, with the same force and

effect as if they were given in full text. Upon

request, the Contracting Officer will make

their full text available. Also, the full text of

a clause may be accessed electronically at

this/these address(es):

lllllllllllllllllllll

lllllllllllllllllllll

[Insert one or more Internet addresses]

(End of clause)

PART 53—FORMS

53.213 and 53.243 [Amended]

25. Amend the internal references

throughout 53.213 and 53.243 as

indicated in the following table:

Location Remove Insert

53.213(a) ............................................................................................................... 13.107 both times it appears ........................ 13.307(b)

53.213(b) ............................................................................................................... 13.503(b) ....................................................... 13.307(c)(3)

3.213(c) ................................................................................................................. 13.505(b) ....................................................... 13.306

53.213(d) ............................................................................................................... 13.404(e) ....................................................... 13.307(e)

53.213(e) ............................................................................................................... 13.107(c) ....................................................... 13.307(c)(1)

53.213(f)(1) ............................................................................................................ 13.505 ........................................................... 13.307

53.213(f)(2) ............................................................................................................ 13.202 ........................................................... 13.303–2

53.213(f)(2) ............................................................................................................ 13.204(e) ....................................................... 13.303–5

53.243 undesignated paragraph ........................................................................... 13.503(b) ....................................................... 13.302–3

[FR Doc. 97–31817 Filed 12–8–97; 8:45 am]

BILLING CODE 6820–EP–P

DEPARTMENT OF DEFENSE

GENERAL SERVICES

ADMINISTRATION

NATIONAL AERONAUTICS AND

SPACE ADMINISTRATION

48 CFR Part 25

[FAC 97–03; FAR Case 97–021; Item V]

RIN 9000–AH80

Federal Acquisition Regulation;

Reporting Trade Sanction Exemptions

AGENCIES: Department of Defense (DoD),

General Services Administration (GSA),

and National Aeronautics and Space

Administration (NASA).

ACTION: Final rule.

SUMMARY: The Civilian Agency

Acquisition Council and the Defense

Acquisition Regulations Council have

agreed on a final rule amending the

Federal Acquisition Regulation (FAR) to

revise the reporting requirements for

trade sanction exemptions. This

regulatory action was not subject to

Office of Management and Budget

review under Executive Order 12866,

dated September 30, 1993, and is not a

major rule under 5 U.S.C. 804.

EFFECTIVE DATE: February 9, 1998.

FOR FURTHER INFORMATION CONTACT: The

FAR Secretariat, Room 4035, GS

Building, Washington, DC 20405, (202)

501–4755, for information pertaining to

status or publication schedules. For

clarification of content, contact Mr. Paul

Linfield, Procurement Analyst, at (202)

501–1757. Please cite FAC 97–03, FAR

case 97–021.

SUPPLEMENTARY INFORMATION:

A. Background

This final rule amends FAR Subpart

25.10 to eliminate requirements for

agencies to notify Congress when

exercising the authority at FAR

25.1002(c) for exemption of certain

procurements from the trade sanctions

imposed by the President. The rule

instead requires agencies to notify the

United States Trade Representative

(USTR) of such exemptions within 30

days after contract award. FAR Subpart

25.10 implements sanctions imposed by

the President (58 FR 31136, May 28,

1993) pursuant to the Trade Agreements

Act (10 U.S.C. 2515), as amended by

Title VII of Public Law 100–418 (The

Buy American Act of 1988). The Buy

American Act of 1988 also amended 41

U.S.C. 10b-1 to permit agency heads to

waive application of the sanctions for

certain contracts after providing

notification to Congress.

The Buy American Act of 1988

included a sunset provision (Section

7004) by which amendments to 19

U.S.C. 2515 and 41 U.S.C. 10b-1 expired

on April 30, 1996. However, the

sanctions imposed by the President

remain in effect until the President

amends or terminates them. The

requirement to notify Congress is no

longer in effect. Since the USTR is

delegated by the President with

administering the sanctions, the

requirement to notify the USTR has

been retained.

B. Regulatory Flexibility Act

The final rule does not constitute a

significant FAR revision within the

meaning of FAR 1.501 and Public Law

98–577, and publication for public

comments is not required. However,

comments from small entities

concerning the affected FAR subpart

will be considered in accordance with 5

U.S.C. 610. Such comments must be

submitted separately and should cite 5

U.S.C. 601, et seq. (FAC 97–03, FAR

case 97–021), in correspondence.

C. Paperwork Reduction Act

The Paperwork Reduction Act does

not apply because the changes to the

FAR do not impose recordkeeping or

information collection requirements, or

collections of information from offerors,

contractors, or members of the public

which 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 25

Government procurement.

Dated: December 1, 1997.

Edward C. Loeb,

Director, Federal Acquisition Policy Division.

Therefore, 48 CFR part 25 is amended

as set forth below:

PART 25—FOREIGN ACQUISITION

1. The authority citation for 48 CFR

Part 25 continues to read as follows:

Authority: 40 U.S.C. 486(c); 10 U.S.C.

chapter 137; and 42 U.S.C. 2473(c).

2. Section 25.1000 is revised to read

as follows: