30646 Federal Register / Vol. 83, No. 126 / Friday, June 29, 2018 / Proposed Rules 

DEPARTMENT OF DEFENSE 

Defense Acquisition Regulations 

System 

48 CFR Parts 212, 219, and 252 

[Docket DARS–2018–0035] 

RIN 0750–AJ21 

Defense Federal Acquisition 

Regulation Supplement: Inapplicability 

of Certain Laws and Regulations to 

Commercial Items (DFARS Case 2017– 

D010) 

AGENCY: Defense Acquisition 

Regulations System, Department of 

Defense (DoD). 

ACTION: Proposed rule. 

SUMMARY: DoD is proposing to amend 

the Defense Federal Acquisition 

Regulation Supplement (DFARS) to 

implement a section of the National 

Defense Authorization Act for Fiscal 

Year 2017 that addresses the 

inapplicability of certain laws and 

regulations to the acquisition of 

commercial items, including 

commercially available off-the-shelf 

items. 

DATES: Comments on the proposed rule 

should be submitted in writing to the 

address shown below on or before 

August 28, 2018, to be considered in the 

formation of a final rule. 

ADDRESSES: Submit comments 

identified by DFARS Case 2017–D010, 

using any of the following methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for sending comments. 

• Email: osd.dfars@mail.mil. Include 

DFARS Case 2017–D010 in the subject 

line of the message. 

• Fax: 571–372–6094. 

• Mail: Defense Acquisition 

Regulations System, Attn: Ms. Amy G. 

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

Room 3B941, 3060 Defense Pentagon, 

Washington, DC 20301–3060. 

Instructions: Search for ‘‘DFARS Case 

2017–D010.’’ Select ‘‘Comment Now’’ 

and follow the instructions provided to 

submit a comment. All submissions 

received must include the agency name 

and docket number or Regulatory 

Information Number (RIN) for this 

rulemaking. Comments received 

generally will be posted without change 

to http://www.regulations.gov, including 

any personal information provided. To 

confirm receipt of your comment(s), 

please check www.regulations.gov, 

approximately two to three days after 

submission to verify posting (except 

allow 30 days for posting of comments 

submitted by mail). 

Docket: For access to the docket to 

read background documents or 

comments received, go to: http://

www.regulations.gov. 

FOR FURTHER INFORMATION CONTACT: Ms. 

Amy G. Williams, telephone 571–372– 

6106. 

SUPPLEMENTARY INFORMATION: 

I. Background 

DoD is proposing to amend the 

DFARS to implement section 874 of the 

National Defense Authorization Act for 

Fiscal Year 2017. Section 874— 

• Amends 10 U.S.C. 2375, 

Relationship of commercial item 

provisions to other provisions of law, to 

provide that— 

Æ No contract for the acquisition of a 

commercial item, subcontract under a 

contract for the procurement of a 

commercial item, or contract for the 

procurement of a commercially 

available off-the-shelf (COTS) item shall 

be subject to any law properly listed in 

the Federal Acquisition Regulation 

(FAR) pursuant to 41 U.S.C. 1906 or 

1907, respectively; and 

Æ The DFARS shall include lists of 

defense-unique provisions of law and 

contract clause requirements based on 

Governmentwide acquisition 

regulations, policies, or Executive 

orders not expressly authorized in law, 

that are inapplicable to— 

D The acquisition of a commercial 

item; 

D Subcontracts for commercial items 

under a contract for the procurement of 

commercial items; or 

D Contracts for the procurement of a 

COTS item; 

• Provides that a covered provision of 

law or contract clause requirement is a 

provision of law or contract clause 

requirement that the Under Secretary of 

Defense for Acquisition, Technology, 

and Logistics determines sets forth 

policies, procedures, requirements, or 

restrictions for the procurement of 

property or services by the Federal 

Government, except for a provision of 

law or contract clause requirement 

that— 

Æ Provides for civil or criminal 

penalties; 

Æ Requires that certain articles be 

bought from American sources pursuant 

to 10 U.S.C. 2533a; or requires that 

strategic materials critical to national 

security be bought from American 

sources pursuant to 10 U.S.C. 2533b; or 

Æ Specifically refers to this section 

and provides that, notwithstanding this 

section, it shall be applicable to 

contracts for the procurement of 

commercial items. 

• Provides that a covered provision of 

law or contract clause requirement shall 

be included on the list unless the Under 

Secretary of Defense for Acquisition, 

Technology, and Logistics makes a 

written determination that such 

exemption would not be in the best 

interest of DoD. 

• Requires the Under Secretary of 

Defense for Acquisition, Technology, 

and Logistics to ensure that, to the 

maximum extent practicable— 

Æ The DFARS shall not require the 

inclusion of contract clauses in 

contracts for the procurement of 

commercial items (including COTS 

items), unless such clauses are required 

to implement provisions of law or 

Executive orders applicable to such 

contracts, or determined to be consistent 

with standard commercial practice; and 

Æ The flowdown of contract clauses 

to subcontracts under contracts for the 

procurement of commercial items 

(including COTS items) is prohibited 

unless such flowdown is required to 

implement provisions of law or 

Executive orders applicable to such 

subcontracts; and 

• Defines the term ‘‘subcontract’’ to 

exclude agreements entered into by a 

contractor for the supply of 

commodities that are intended for use in 

the performance of multiple contracts 

with the DoD and other parties, and are 

not identifiable to any particular 

contract. 

II. Discussion and Analysis 

10 U.S.C. 2375(b)(2) limits the 

required review of applicability of 

provisions of law and contract clauses 

to prime contracts for commercial items 

to those provisions of law and contract 

clauses enacted after January 1, 2015. 

Although the subsequent paragraphs (c) 

and (d) relating to applicability of 

provisions of law and contract clauses 

to subcontracts for commercial items 

and contracts for COTS items are in all 

other regards parallel, the date of 

January 1, 2015, is not repeated in the 

subsequent paragraphs. DoD has 

interpreted the date as equally 

applicable to all three paragraphs, 

because the three paragraphs are closely 

inter-related. Any law or clause that is 

inapplicable to a contract for 

commercial items is also inapplicable to 

a contract for COTS items (which are 

commercial items). The COTS list 

builds on the list of laws and clauses 

inapplicable to commercial items in 

general. Further, laws and clauses that 

are inapplicable to contracts for 

commercial items will also be 

inapplicable to subcontracts for 

commercial items, even though there 

may be a few additional laws or clauses 

that are just inapplicable at the 

subcontract level. 


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Therefore, as the first step toward 

implementation of section 874 of the 

NDAA for FY 2017 in the DFARS, DoD 

identified all new DFARS and FAR 

provisions and clauses published as 

interim or final rules after January 1, 

2015; determined whether these 

provisions and clauses were based on 

statute or Executive order, and reviewed 

their applicability to commercial items. 

A. Governmentwide Statutes 

Since the DFARS supplements the 

FAR, the lists of inapplicable statutes at 

FAR 12.503 through 12.505 are 

applicable to DoD. This rule proposes 

language at DFARS 212.503, 212.504, 

and 212.505, to emphasize that the 

DFARS lists of statutes are in addition 

to the FAR lists, not in place of them. 

B. Defense-Unique Statutes 

Although the following defenseunique statutes were all enacted prior to 

January 1, 2015, and are therefore not 

covered statutes as defined in section 

874, they are the basis for DFARS 

provisions and clauses issued after 

January 1, 2015, and have therefore been 

reviewed. 

1. The Director of Defense 

Procurement and Acquisition Policy, 

acting under authority delegated by the 

Under Secretary of Defense for 

Acquisition, Technology, and Logistics, 

has determined that the following 

statutes apply to the acquisition of 

commercial items, except for the 

acquisition of COTS items. Note that 

services are not COTS items, so no 

determination is required to exclude 

applicability to COTS items when 

acquiring services and the clause 

prescription and flowdown paragraph of 

the clause do not specify exclusion of 

COTS items. 

a. Section 941 of the NDAA for FY 

2013 and section 1632 of NDAA for FY 

2015 (DFARS Case 2013–D018, Network 

Penetration Reporting and Contracting 

of Cloud Services (80 FR 51739 and 81 

FR 72986); DFARS 252.204–7008, 

252.204–7009, and 252.204–7012). This 

rule proposes to clarify that the 

flowdown requirement in paragraph (m) 

of the clause at DFARS 252.204–7012 

excludes flowdown to COTS items. 

Although the final rule under DFARS 

case 2013–D018 stated the exclusion of 

applicability to COTS items for all 

provisions and clauses under the case 

and the clause prescriptions were 

amended, the corresponding 

amendment to paragraph (m) of the 

clause at DFARS 252.204–7012 did not 

explicitly exclude flowdown to COTS 

items. This statute has been added to 

the proposed list at DFARS 212.505. 

b. Section 862 of the NDAA for FY 

2008 (DFARS Case 2015–D021, Defense 

Contractors Performing Private Security 

Functions (80 FR 81496 and 81 FR 

42559); DFARS 252.225–7039). This 

statute was not added to the proposed 

list at DFARS 212.505 because it is for 

the acquisition of services. 

2. The Director of Defense 

Procurement and Acquisition Policy, 

acting under authority delegated by the 

Under Secretary of Defense for 

Acquisition, Technology, and Logistics, 

determined that section 818(c)(3) of the 

NDAA for FY 2012, as amended 

(DFARS Case 2014–D005, Detection and 

Avoidance of Counterfeit Parts—Further 

Implementation (80 FR 63735 and 81 FR 

50635); DFARS 252.246–7008) applies 

to the acquisition of commercial items, 

including COTS items. 

3. The following two statutes are 

currently applied in the DFARS to the 

acquisition of commercial items, 

including COTS items. However, 

continued application to commercial 

items is dependent upon a 

determination by the Director of Defense 

Procurement and Acquisition Policy, 

acting under authority delegated by the 

Under Secretary of Defense for 

Acquisition and Sustainment, with 

regard to the applicability to 

commercial items: 

a. Section 1611 of the NDAA for FY 

2014 (10 U.S.C. 2419) (DFARS Case 

2014–D009, Advancing Small Business 

Growth (79 FR 65917 and 80 FR 30115); 

DFARS 252.219–7000). The provision at 

DFARS 252.219–7000, Advancing Small 

Business Growth, is prescribed at 

DFARS 219.309 for use in solicitations, 

including solicitations using FAR part 

12 procedures for acquisition of 

commercial items, when the estimated 

annual value of the contract is expected 

to exceed— 

• The small business size standard, if 

expressed in dollars, for the North 

American Industry Classification 

System (NAICS) code assigned by the 

contracting officer; or 

• $70 million, if the small business 

size standard is expressed as number of 

employees for the NAICS code assigned 

by the contracting officer. 

The provision is also listed at DFARS 

212.301(f)(vii) as applicable to the 

acquisition of commercial items. The 

provision is inapplicable to 

subcontracts. This provision does not 

impose any burden on offerors, but is 

intended only to advise small 

businesses that entering into a DoD 

contract may eventually cause such 

businesses to exceed the small business 

size standard. 

b. Section 8123 of the DoD 

Appropriations Act and the same 

provision in subsequent annual defense 

appropriations acts (DFARS Case 2015– 

D005, Acquisition of the American Flag 

(80 FR 10452 and 80 FR 51748); DFARS 

252.225–7006). The clause at DFARS 

252.225–7006, Acquisition of the 

American Flag, is prescribed at 

225.7002–3 for use in solicitations and 

contracts, including solicitations and 

contracts using FAR part 12 procedures 

for the acquisition of commercial items, 

that are for the acquisition of the 

American flag, with an estimated value 

that exceeds the simplified acquisition 

threshold, unless an exception at 

225.7002–2 applies. The clause is also 

listed at 212.301(f)(x)(C) as applicable to 

acquisition of commercial items. The 

clause does not flow down to 

subcontracts. Since most, if not all, flags 

are commercial items, this statute would 

be without affect if not applied to 

commercial items. Furthermore, this is 

an appropriations act restriction, which 

specifically prohibits the expenditure of 

any funds appropriated under these 

acts, unless the flags to be acquired are 

manufactured in the United States 

(regardless of whether the flags are 

commercial items). 

C. FAR and DFARS Provisions and 

Clauses, Issued Since January 1, 2015, 

Not Expressly Authorized in Law 

1. The following DFARS and FAR 

provisions are not required for use in 

solicitations for the acquisition of 

commercial items, including COTS 

items. FAR 12.301(e) provides for 

discretionary use of provisions and 

clause not required for use solicitations 

and contracts using FAR part 12 

procedures for the acquisition of 

commercial items, when their use is 

consistent with the limitations 

contained in FAR 12.302. These 

provisions do not apply to subcontracts. 

Both provisions are proposed for 

addition to the proposed list at DFARS 

212.370. DoD welcomes comments as to 

whether use of these provisions in 

solicitations for commercial items 

should be prohibited, or whether their 

use might be appropriate for 

discretionary use. 

a. 252.219–7010, Notification of 

Competition Limited to Eligible 8(a) 

Concerns—Partnership Agreement 

(DFARS Case 2015–D017, 80 FR 58669 

and 81 FR 17045), is prescribed at 

DFARS 219.811–3 for use in lieu of the 

clause at FAR 52.219–18, Notification of 

Competition Limited to Eligible 8(a) 

Concerns, in competitive solicitations 

and contracts when the acquisition is 

accomplished using the procedures of 

FAR 19.805 and processed in 

accordance with the partnership 

agreement cited in DFARS 219.800. It is 


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30648 Federal Register / Vol. 83, No. 126 / Friday, June 29, 2018 / Proposed Rules 

not listed at 212.301(f) as applicable to 

acquisitions using FAR part 12 

procedures for the acquisition of 

commercial items. 

This rule proposes to modify the 

clause prescription to specifically 

exclude applicability to acquisitions 

using FAR part 12 procedures for the 

acquisition of commercial items. 

b. 52.204–22, Alternative Line Item 

Proposals (FAR Case 2013–014, 79 FR 

45408 and 82 FR 4709), is prescribed at 

FAR 4.1008 for use in all solicitations. 

However, this provision is not 

prescribed for use in FAR part 12. In 

accordance with FAR 12.301(d), 

notwithstanding prescriptions 

contained elsewhere in the FAR, when 

acquiring commercial items, contracting 

officers are only required to use those 

provisions and clauses prescribed in 

FAR part 12. This rule proposes to 

modify the clause prescription to 

specifically exclude applicability to 

acquisitions using FAR part 12 

procedures for the acquisition of 

commercial items. 

2. The following DFARS and FAR 

provisions and clause are applicable to 

the acquisition of commercial items, 

except for COTS items. In accordance 

with section 874, continued 

applicability to commercial items is 

dependent upon a determination by the 

Director of Defense Procurement and 

Acquisition Policy, acting under 

authority delegated by the Under 

Secretary of Defense for Acquisition, 

Technology, and Logistics, with regard 

to the applicability to commercial items: 

a. DFARS 252.239–7009, 

Representation of Use of Cloud 

Computing, and 252.239–7010, Cloud 

Computing Services (DFARS Case 2013– 

D018, 80 FR 51739, 80 FR 81472, and 

81 FR 50635), are prescribed at DFARS 

239.7604 for use in solicitations and 

contracts using FAR part 12 procedures 

for the acquisition of commercial items, 

for information technology services and 

are also listed at DFARS 

212.301(f)(xvi)(A) and (B) as applicable 

to acquisitions of commercial items. The 

clause also flows down to all 

subcontracts that involve or may 

involve cloud services, including 

subcontracts for commercial items. This 

provision and clause are not listed at 

proposed DFARS 212.371 because this 

provision and clause apply to the 

acquisition of services, which are not 

COTS items. 

DoD applies this provision and clause 

to the acquisition of commercial items, 

excluding COTS items, because the 

harm that could result from the loss or 

compromise of defense information is 

the same under a FAR part 12 contract 

as it would be under any other contract. 

Recent high-profile breaches of Federal 

information show the need to ensure 

that information security protections are 

clearly, effectively, and consistently 

addressed in contracts. Failure to apply 

this provision and clause to acquisition 

of cloud services may cause harm to the 

Government which could directly 

impact national security. The 

information collection requirement for 

this provision and clause is approved 

under OMB clearance 0704–0478, 

Safeguarding Covered Defense 

Information, Cyber Incident Reporting, 

and Cloud Computing, in the amount of 

250,850 total annual burden hours, 

which also includes burden hours 

associated with Safeguarding and cyber 

incident reporting. 

b. FAR 52.204–21, Basic Safeguarding 

of Covered Contractor Information 

Systems (FAR Case 2011–020, 77 FR 

51496 and 82 FR 4709), is prescribed at 

FAR 4.1903, for use when the contractor 

or a subcontractor at any tier may have 

Federal contract information residing in 

or transiting through the information 

system. FAR 12.301(d)(3) requires use in 

solicitations and contracts for 

commercial items (except for 

acquisitions of COTS items), as 

prescribed in FAR 4.1903. Paragraph (c) 

of FAR 52.204–21 requires flowdown to 

subcontracts, including subcontracts for 

the acquisition of commercial items, 

other than COTS items, in which the 

contractor may have Federal contract 

information residing in or transiting 

through its information system. 

Flowdown to subcontracts for 

commercial item, other than 

subcontracts for COTS items, is also 

required at FAR 52.244–6(c)(1)(iv), if 

flowdown is required in accordance 

with FAR 52.204–21(c). 

This clause requires only a basic level 

of safeguarding of contractor 

information systems reflective of actions 

any prudent business person would 

employ. The exclusion of COTS items 

was incorporated in the final rule in 

response to public comments. This 

clause does not impose any information 

collection burden on contractors. 

c. FAR 52.222–62, Paid Sick Leave 

Under Executive Order 13706 (FAR 

Case 2017–001, 81 FR 91627, interim 

rule), is prescribed at FAR 22.2110, for 

use in solicitations and contracts that 

include the clause 52.222–6, 

Construction Wage Rate Requirements, 

or 52.222–41, Service Contract Labor 

Standards, where work is to be 

performed, in whole or in part, in the 

United States. Use of the clause when 

using part 12 procedures for the 

acquisition of commercial items is 

provided at FAR 52.212–5(c)(9). The 

clause flows down to all subcontracts, 

regardless of dollar value, that are 

subject to the Service Contract Labor 

Standards statute or the Wage Rate 

Requirements (Construction) statute and 

are also to be performed in whole or in 

part in the United States. Flowdown to 

commercial subcontracts (excluding 

COTS items) is provided at FAR 52.212– 

5(e)(1)(xix) and 52.244–6(c). 

This rule implements Executive Order 

13706, which does not exempt contracts 

for the acquisition of commercial items. 

The implementing regulations by the 

Department of Labor were issued on 

September 30, 2016 (81 FR 67598). The 

rule applies to contracts that are covered 

by the Service Contract Labor Standards 

statute or the Wage Rate Requirements 

(Construction) statute, and meet or 

exceed the thresholds specified in those 

statutes. However, since these statutes 

do not apply to contracts for acquisition 

of supplies, the rule does not cover 

acquisitions of COTS items. 

The Executive Order seeks to increase 

efficiency and cost savings in the work 

performed by parties who contract with 

the Government by ensuring that 

employees on those contracts can earn 

up to 7 days or more of paid sick leave 

annually. The Executive order was first 

implemented in Department of Labor 

regulations (81 FR 67598), which OIRA 

declared to be an economically 

significant rule and a major rule. Most 

of the costs associated with this rule are 

transfer costs from employers to 

employees. The information collection 

requirements associated with the 

Department of Labor final rule were 

cleared under OMB clearances 1235– 

0018, 1235–0021, 1235–0029. The FAR 

rule does not impose any additional 

burdens. 

3. The following DFARS and FAR 

provisions and clause are applicable to 

the acquisition of commercial items, 

including COTS items. In accordance 

with section 874, continued 

applicability to commercial items is 

dependent upon a determination by the 

Director of Defense Procurement and 

Acquisition Policy, acting under 

authority delegated by the Under 

Secretary of Defense for Acquisition, 

Technology, and Logistics, with regard 

to the applicability to commercial items: 

a. DFARS 252.213–7000, Notice to 

Prospective Suppliers on Use of Past 

Performance Information Retrieval 

System—Statistical Reporting in Past 

Performance Evaluation (DFARS Case 

2014–D015, 80 FR 4848 and 80 FR 

30117), is prescribed at DFARS 

213.106–2–70, in competitive 

solicitations for supplies when using 

FAR part 13 simplified acquisition 

procedures, including competitive 

solicitations using FAR part 12 


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Federal Register / Vol. 83, No. 126 / Friday, June 29, 2018 / Proposed Rules 30649 

procedures for the acquisition of 

commercial item and acquisitions 

values at less than or equal to $1 million 

under the authority at FAR subpart 13.5 

procedures. This provision is also listed 

at DFARS 212.301(f)(v) as applicable to 

solicitations and contracts using FAR 

part 12 procedures for the acquisition of 

commercial items. There is no 

flowdown because this is a provision. 

DoD developed and deployed the Past 

Performance Information Retrieval 

System—Statistical Reporting (PPIRS– 

SR) module to fill the need for past 

performance data on lower dollar value 

contracts. This objective data on past 

performance will assist contracting 

officers in making better-informed best 

value award decisions on small dollar 

value acquisitions for supplies, while 

also eliminating the burden of collecting 

subjective past performance information 

on contractors for smaller dollar value 

contracts. This benefit is equally 

applicable, whether or not the items to 

be acquired are commercial. There is no 

information collection burden on 

offerors. 

b. DFARS 252.229–7014, Taxes— 

Foreign Contracts in Afghanistan, and 

252.229–7015, Taxes—Foreign 

Contracts in Afghanistan (North Atlantic 

treaty Organization Status of Forces 

Agreement) (DFARS Case 2014–D003, 

79 FR 35715 and 80 FR 81467), are 

prescribed at 229.402–70 (k) and (l), 

respectively. 

• DFARS 252.229–7014, Taxes— 

Foreign Contracts in Afghanistan, is for 

use in solicitations and contracts, 

including solicitations and contracts 

using FAR part 12 procedures for the 

acquisition of commercial items, with 

performance in Afghanistan, unless the 

clause at 252.229–7015 is used. 

• DFARS 252.229–7015, Taxes— 

Foreign Contracts in Afghanistan (North 

Atlantic Treaty Organization Status of 

Forces Agreement), is for use instead of 

the clause at 252.229–7014, Taxes— 

Foreign Contracts in Afghanistan, in 

solicitations and contracts, including 

solicitations and contracts using FAR 

part 12 procedures for the acquisition of 

commercial items, with performance in 

Afghanistan awarded on behalf of the 

North Atlantic Treaty Organization 

(NATO), which are governed by the 

NATO Status of Forces Agreement 

(SOFA), if approval from the Director, 

Defense Procurement and Acquisition 

Policy, Office of the Under Secretary of 

Defense for Acquisition, Technology, 

and Logistics, has been obtained prior to 

each use. 

These clause are also listed at DFARS 

212.301(f)(xiii) as applicable to 

solicitations and contracts using FAR 

part 12 procedures for the acquisition of 

commercial items. Both clauses flow 

down to all subcontracts, including 

subcontracts for commercial items. 

The objective of these clauses is to 

exempt DoD contracts performed in 

Afghanistan from payment liability for 

Afghan taxes pursuant to the bilateral 

security agreement between Afghanistan 

and the United States and the North 

Atlantic Treaty Organization (NATO) 

Status of Forces Agreement (SOFA). 

DoD applies these two clauses to 

solicitations and contracts for the 

acquisition of commercial items, 

including COTS items, for contracts 

performed in Afghanistan. Not applying 

this guidance to contracts for the 

acquisition of commercial items, 

including COTS items, would result in 

DoD paying unnecessary taxes, reducing 

the funds available for pursuing the war 

effort in Afghanistan. These clauses do 

not impose any information collection 

burden on offerors or contractors. 

c. FAR 52.223–11, Ozone-Depleting 

Substances and High Global Warming 

Potential Hydrofluorocarbons; FAR 

52.223–12, Maintenance, Service, 

Repair, or Disposal of Refrigeration 

Equipment and Air Conditioner; FAR 

52.223–20, Aerosols; and FAR 52.223– 

21, Foams (FAR Case 2014–026, 80 FR 

26883 and 81 FR 30429), are prescribed 

at FAR 23.804(a) for use as follows: 

(1) FAR 52.223–11, Ozone-Depleting 

Substances and High Global Warming 

Potential Hydrofluorocarbons, in 

solicitations and contracts for— 

(i) Refrigeration equipment (in 

product or service code (PSC) 4110); 

(ii) Air conditioning equipment (PSC 

4120); 

(iii) Clean agent fire suppression 

systems/equipment (e.g., installed room 

flooding systems, portable fire 

extinguishers, aircraft/tactical vehicle 

fire/explosion suppression systems) (in 

PSC 4210); 

(iv) Bulk refrigerants and fire 

suppressants (in PSC 6830); 

(v) Solvents, dusters, freezing 

compounds, mold release agents, and 

any other miscellaneous chemical 

specialty that may contain ozonedepleting substances or high global 

warming potential hydrofluorocarbons 

(in PSC 6850); 

(vi) Corrosion prevention compounds, 

foam sealants, aerosol mold release 

agents, and any other preservative or 

sealing compound that may contain 

ozone-depleting substances or high 

global warming potential 

hydrofluorocarbons (in PSC 8030); 

(vii) Fluorocarbon lubricants 

(primarily aerosols) (in PSC 9150); and 

(viii) Any other manufactured end 

products that may contain or be 

manufactured with ozone-depleting 

substances. 

(2) FAR 52.223–12, Maintenance, 

Service, Repair, or Disposal of 

Refrigeration Equipment and Air 

Conditioners, in solicitations and 

contracts that include the maintenance, 

service, repair, or disposal of— 

(i) Refrigeration equipment, such as 

refrigerators, chillers, or freezers; or 

(ii) Air conditioners, including air 

conditioning systems in motor vehicles. 

(3) FAR 52.223–20, Aerosols, in 

solicitations and contracts— 

(i) For products that may contain high 

global warming potential 

hydrofluorocarbons as a propellant, or 

as a solvent; or 

(ii) That involve maintenance or 

repair of electronic or mechanical 

devices. 

(4) FAR 52.223–21, Foams, in 

solicitations and contracts for— 

(i) Products that may contain high 

global warming potential 

hydrofluorocarbons or refrigerant blends 

containing hydrofluorocarbons as a 

foam blowing agent, such as building 

foam insulation or appliance foam 

insulation; or 

(ii) Construction of buildings or 

facilities. A majority of the acquisitions 

involving high GWP HFCs involve the 

acquisition of commercial items. 

Applicability of the requirements to 

commercial items is necessary to be 

effective. The information collection 

requirements associated with this case 

are covered under OMB clearance 9000– 

0191, High Global Warming Potential 

Hydrofluorocarbons, in the amount of 

25,376 total annual burden hours. 

d. FAR 52.223–22, Public Disclosure 

of Greenhouse Gas Emissions and 

Reduction Goals—Representation (FAR 

Case 2015–024, 81 FR 33192 and 81 FR 

83092), is prescribed for use at FAR 

23.804(b). The provision at 52.223–22, 

Public Disclosure of Greenhouse Gas 

Emissions and Reduction Goals— 

Representation, is required only when 

52.204–7, System for Award 

Management, is included in the 

solicitation (see 52.204–8, Annual 

Representations and Certifications). 

The information obtained from these 

representations will assist agencies in 

developing strategies to engage with 

offerors to reduce supply chain 

emissions, as directed in Executive 

Order 13693, Planning for Federal 

Sustainability in the Next Decade. In 

response to the proposed rule, one 

respondent remarked that the rule 

should not exclude commercial item or 

COTS item vendors from the disclosure 

requirements, because then the benefits 

of the rule would be ‘‘sub-optimal.’’ 


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30650 Federal Register / Vol. 83, No. 126 / Friday, June 29, 2018 / Proposed Rules 

The Federal Acquisition Regulatory 

Council determined that the rule would 

apply to acquisitions of commercial 

items, including commercially available 

off-the-shelf (COTS) items, if the 

contractor has been awarded contracts 

of more than $7.5 million in goods and 

services during the prior Government 

fiscal year. The FAR Council considered 

(i) The benefits of the policy in 

furthering Administration goals; (ii) the 

extent to which the benefits of the 

policy would be reduced if exemptions 

are provided; and (iii) the burden on 

contractors if the policy is applied to 

these categories of spend. By developing 

an inventory of contractor greenhouse 

gas (GHG) management practices, the 

Government can more fully understand 

the current state of activity by 

companies doing business with the 

Government and work with contractors 

over time to develop appropriate 

strategies to reduce supply chain 

emissions. GHG reporting is becoming 

increasingly commonplace in the 

commercial marketplace. If an exclusion 

were provided to sellers of commercial 

items and COTS, a large number of 

contractors that sell in both the 

commercial and Federal marketplace 

would be exempted and the rule would 

fail at providing the type of information 

and insight that is needed to help 

agencies assess supplier GHG 

management practices. With respect to 

the third factor, the FAR Council sought 

to minimize burden associated with the 

disclosure requirement. Specifically, the 

disclosure will apply only to major 

Federal suppliers who have been 

awarded contracts totaling more than 

$7.5 million in goods and services in the 

prior Government fiscal year. Based on 

fiscal year (FY) 2015 data, the FAR 

Council estimated this requirement 

would cover approximately 5,500 

unique entities, including about 2,700 

small businesses. This represents 

approximately 3.5 percent of total 

entities that did business with the 

Federal Government in FY 2015, and 2.6 

percent of small businesses. The FAR 

Council projected a minimal paperwork 

burden associated with the disclosure, 

approximately .25 hours per response 

for annual reporting for the 5,500 

contractor, or 1,375 hours (OMB 

clearance 9000–0194, Public Disclosure 

of Greenhouse Gas Emissions and 

Reduction Goals). Accordingly, the FAR 

Council determined that it would not be 

in the best interest of the Government to 

exclude application of the rule for 

acquisitions, or sellers, of commercial 

items or COTS. 

D. Limitation on Inclusion of Contract 

Clauses in Contracts for the 

Procurement of Commercial Items 

Section 874(b) requires that the Under 

Secretary of Defense for Acquisition, 

Technology, and Logistics (now Under 

Secretary of Defense for Acquisition and 

Sustainment) shall ensure that the 

DFARS does not require inclusion of 

contract clauses in contracts for the 

procurement of commercial items or 

contracts for the procurement of COTS 

items, unless those clauses are required 

to implement provisions of law or 

executive orders applicable to such 

contracts, or determined to be consistent 

with standard commercial practice. This 

requirement is essentially the same as 

the requirement at 41 U.S.C. 3307, 

which is implemented at FAR 12.301(a). 

Since the DFARS supplements the FAR, 

FAR 12.301(a) is already applicable to 

DoD. 

E. Prohibition of Flowdown of Certain 

Contract Clauses to Subcontracts Under 

Contracts for the Procurement of 

Commercial Items, Including COTS 

Items 

Currently, FAR clauses 52.212–5, 

52.244–6, and DFARS clause 52.244– 

7000, require flowdown of certain 

clauses to subcontracts for commercial 

items, but allow the contractor to flow 

down ‘‘a minimal number of additional 

clauses necessary to satisfy its 

contractual obligations.’’ One of the 

respondents to the proposed rule under 

DFARS Case 2011–D056, Solicitation 

Provisions and Contract Clauses for the 

Acquisition of Commercial Items, 

(Proprietary Industries Association) 

commented back in May of 2012 that 

this allowance of a minimal number of 

necessary clauses was being abused by 

contractors, who were overloading 

commercial item subcontracts ‘‘with 

whatever flowdown clauses they felt 

were even remotely deemed necessary, 

regardless of any harmful consequences 

to the Governments commercial item 

acquisition process.’’ We now have a 

statutory prohibition on such 

discretionary overloading of commercial 

item subcontracts (although still 

providing ‘‘to the maximum extent 

practicable). This rule proposes that any 

discretion to impose flowdown of 

clauses that are not based on statute or 

Executive order shall rest with the 

Government, not with the contractors. 

They will be prohibited from flowing 

down FAR or DFARS clauses to 

commercial items, unless flow down is 

specifically required in the FAR or 

DFARS. A contractor can, of course, still 

impose its own requirements on 

subcontractors, but cannot just flow 

down FAR and DFARS clauses as a 

whole. DoD invites specific comment on 

the extent to which FAR and DFARS 

clauses are flowed down to subcontracts 

on an optional basis and the expected 

burden reduction that may result from 

this prohibition. 

F. Definition of ‘‘Subcontract’’ 

10 U.S.C. 2375(c)(3) provides a 

definition of ‘‘subcontract’’ that 

includes transfers of commercial items 

between divisions, subsidiaries, or 

affiliates, of a contractor or 

subcontractor, but excludes supplier 

agreements entered into by a contractor 

for the supply of commodities that are 

intended for use in the performance of 

multiple contracts with DoD and other 

parties and are not identifiable to any 

particular contract. This definition is 

similar to the definition of 

‘‘subcontract’’ at FAR 44.101, which 

states that the subcontract is ‘‘entered 

into by a subcontractor to furnish 

supplies or services for performance of 

a prime contract or subcontract,’’ but is 

more explicit in the exclusion of 

supplier agreements that are not 

associated with a single contract. This 

definition has been added to the clause 

at DFARS 252.244–7000 and each 

DFARS clause that requires flowdown 

to subcontracts for the acquisition of 

commercial items, with specified 

applicability to the flowdown paragraph 

of the clause. In general, the clauses 

now clearly exclude flowdown to 

supplier agreements that are not 

identifiable to any particular contract. 

However, DoD has determined that 

the provisions of section 818 of Public 

Law 112–81 for the prohibitions against 

counterfeit and suspect counterfeit 

electronic items and the requirements 

for systems to detect such parts must 

flow down to all levels of the supply 

chain without exception for any 

contractual instrument that could be 

used to acquire electronic parts. 

Therefore, with regard to the DFARS 

clauses 252.246–7007, Contractor 

Counterfeit Electronic Part Detection 

and Avoidance System, and 252.246– 

7008, Sources of Electronic Parts, the 

flowdown has been modified to include 

flowdown to contractual instruments 

other than subcontracts (such supplier 

agreements), because electronic 

commodity types are often acquired 

from suppliers through supplier 

agreements that do not meet the new 

definition of ‘‘subcontract.’’ Exempting 

acquisitions of such electronic parts 

from the DFARS 252.246–7007 and 

252.246–7008 flowdown requirements 

would create unacceptable risks of 

introducing counterfeit or suspect 

counterfeit electronic parts into the 


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Defense supply chain. Counterfeit 

electronic parts, regardless of dollar 

value, can seriously disrupt the DoD 

supply chain, cause critical failure of 

fielded systems, such as aircraft, ships, 

and other weapon systems, and 

endanger troops’ lives. 

III. Applicability to Contracts At or 

Below the Simplified Acquisition 

Threshold (SAT) and for Commercial 

Items, Including Commercially 

Available Off-the-Shelf (COTS) Items 

This rule reviews the current 

applicability of defense-unique statute 

and Governmentwide provisions and 

clause, issued since January 1, 2015, not 

expressly authorized in law. DoD 

solicits public comments, especially 

with regard to the applicability of the 

two defense-unique statutes at section 

II.B.3 of this preamble and the FAR and 

DFARS provisions and clauses at 

section II.C.2. and II.C.3., for which the 

Director of Defense Procurement and 

Acquisition Policy is considering 

whether to sign a determination and 

finding in support of continued 

applicability to commercial items, or 

whether all commercial items or just 

COTS items should be exempt from a 

particular requirement. Please provide 

specific rationale for any 

recommendations. 

IV. Executive Orders 12866 and 13563 

Executive Orders (E.O.s) 12866 and 

13563 direct agencies to assess all costs 

and benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts, and 

equity). E.O. 13563 emphasizes the 

importance of quantifying both costs 

and benefits, of reducing costs, of 

harmonizing rules, and of promoting 

flexibility. This is not a significant 

regulatory action and, therefore, was not 

subject to review under section 6(b) of 

E.O. 12866, Regulatory Planning and 

Review, dated September 30, 1993. This 

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

804. 

V. Executive Order 13771 

This rule is not an E.O. 13771, 

Reducing Regulation and Controlling 

Regulatory Costs, regulatory action, 

because this rule is not significant under 

E.O. 12866. 

VI. Regulatory Flexibility Act 

DoD does not expect this proposed 

rule to have a significant economic 

impact on a substantial number of small 

entities within the meaning of the 

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

et seq. However, an initial regulatory 

flexibility analysis has been performed 

and is summarized as follows: 

This proposed rule is required in order to 

implement section 874 of the National 

Defense Authorization Act (NDAA) for Fiscal 

Year (FY) 2017, which amended 10 U.S.C. 

2375 and required certain changes to the 

Defense Federal Acquisition Regulation 

Supplement (DFARS). 

The objective of the rule is to reduce any 

unnecessary burdens on contractors and 

subcontractors that were awarded DoD 

contracts or subcontracts for the acquisition 

of commercial items, including commercially 

available off-the-shelf items. The legal basis 

for the rule is section 874 of the NDAA for 

FY 2017. 

There were 29,833 unique entities awarded 

DoD contracts exceeding the micro-purchase 

threshold and using FAR part 12 procedures 

in FY 2016, of which 21,857 were unique 

small entities. DoD estimates there may be at 

least twice that many small entities receiving 

subcontracts for commercial items. Any 

reductions in the applicability of provisions 

and clauses to contracts and subcontracts for 

the acquisition of commercial items may be 

beneficial to these small entities. 

There are no projected reporting, 

recordkeeping, or other compliance 

requirements associated with this rule. The 

final rule may result in some reductions of 

reporting or recordkeeping requirements, 

currently approved under— 

• OMB Control Number 0704–0478, 

Safeguarding Covered Defense Information, 

Cyber Incident Reporting, and Cloud 

Computing. 

• OMB Control Number 9000–0191, High 

Global Warming Potential 

Hydrofluorocarbons. 

• OMB Control Number 9000–0194, Public 

Disclosure of Greenhouse Gas Emissions and 

Reduction Goals. 

The rule does not duplicate, overlap, or 

conflict with any other Federal rules. 

Any impacts of this rule will have a 

positive impact on small business entities. 

DoD invites comments from small 

business concerns and other interested 

parties on the expected impact of this 

rule on small entities. 

DoD will also consider comments 

from small entities concerning the 

existing regulations in subparts affected 

by this rule in accordance with 5 U.S.C. 

610. Interested parties must submit such 

comments separately and should cite 5 

U.S.C. 610 (DFARS Case 2017–D010), in 

correspondence. 

VII. Paperwork Reduction Act 

The rule does not contain any 

information collection requirements that 

require the approval of the Office of 

Management and Budget under the 

Paperwork Reduction Act (44 U.S.C. 

chapter 35). However, if some of the 

requirements are made inapplicable to 

the acquisition of all commercial items, 

or just COTS items, then the estimated 

burden of the following information 

collection requirements could be 

reduced: 

• OMB Control Number 0704–0478, 

Safeguarding Covered Defense 

Information, Cyber Incident Reporting, 

and Cloud Computing. 

• OMB Control Number 9000–0191, 

High Global Warming Potential 

Hydrofluorocarbons. 

• OMB Control Number 9000–0194, 

Public Disclosure of Greenhouse Gas 

Emissions and Reduction Goals. 

List of Subjects in 48 CFR Parts 212, 

219, and 252 

Government procurement. 

Amy G. Williams, 

Deputy, Defense Acquisition Regulations 

System. 

Therefore, 48 CFR parts 212, 219, and 

252 are proposed to be amended as 

follows: 

■ 1. The authority citation for parts 212, 

219, and 252 continues to read as 

follows: 

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

1. 

PART 212—ACQUISITION OF 

COMMERCIAL ITEMS 

■ 2. Amend section 212.001 by adding 

the definition of ‘‘Subcontract’’ in 

alphabetical order to read as follows: 

212.001 Definitions. 

* * * * * 

Subcontract means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

■ 3. Add section 212.370 to read as 

follows: 

212.370 Inapplicability of certain 

provisions and clauses to contracts and 

subcontracts for the acquisition of 

commercial items, including commercially 

available off-the-shelf items. 

The following provisions and clauses, 

not expressly authorized in law, are 

inapplicable to contracts for the 

acquisition of commercial items: 


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(a) FAR 52.204–22, Alternative Line 

Item Proposal. 

(b) 252.219–7010, Notification of 

Competition Limited to Eligible 8(a) 

Concerns—Partnership Agreement. 

■ 4. Add section 212.371 to read as 

follows: 

212.371 Inapplicability of certain 

provisions and clauses to contracts for the 

acquisition of commercially available offthe-shelf items. 

Commercially available off-the-shelf 

(COTS) items are a subset of commercial 

items. Therefore, any provisions and 

clauses are inapplicable to contracts or 

subcontracts for the acquisition of COTS 

items if listed in section 212.370 of this 

subpart as inapplicable to contracts or 

subcontracts for the acquisition of 

commercial items. In addition, the 

following provisions and clauses 

published after January 1, 2015, not 

expressly authorized in law, are 

inapplicable to the acquisition of COTS 

items (provisions and clauses for the 

acquisition of services, which by 

definition are not COTS items, are not 

listed): 

(a) FAR 52.204–21, Basic 

Safeguarding of Covered Contractor 

Information Systems. 

(b) Reserved 

■ 5. Amend section 212.503 by— 

■ a. In the section heading, removing 

‘‘executive’’ and adding ‘‘Executive’’ in 

its place; 

■ b. Revising paragraph (a) introductory 

text; and 

■ c. Amending paragraph (a)(ix) by 

removing ‘‘(Section 843(a), Public Law 

103–160)’’ and adding ‘‘(section 843(a), 

Pub. L. 103–160)’’. 

212.503 Applicability of certain laws to 

Executive agency contracts for the 

acquisition of commercial items. 

(a) In addition to the laws listed at 

FAR 12.503, the following laws are not 

applicable to contracts for the 

acquisition of commercial items: 

* * * * * 

■ 6. Amend section 212.504 by— 

■ a. Revising paragraph (a) introductory 

text; and 

■ b. In paragraph (a)(xvii), removing 

‘‘(Pub. L. 111–118)’’ and adding ‘‘(Pub. 

L. 111–118) (prohibits mandatory 

arbitration)’’ in its place. 

212.504 Applicability of certain laws to 

subcontracts for the acquisition of 

commercial items. 

(a) In addition to the laws listed at 

FAR 12.504, the following laws are not 

applicable to subcontracts at any tier for 

the acquisition of commercial items or 

commercial components: 

* * * * * 

212.570 [Redesignated as 212.505] 

■ 7. Redesignate section 212.570 as 

212.505 and revise newly redesignated 

section 212.505 to read as follows: 

212.505 Applicability of certain laws to 

contracts and subcontracts for the 

acquisition of commercially available offthe-shelf items. 

Commercially available off-the-shelf 

(COTS) items are a subset of commercial 

items. Therefore, any laws listed at FAR 

12.503, FAR 12.504, 212.503, or 212.504 

are also inapplicable or modified in 

their applicability to contracts or 

subcontracts for the acquisition of COTS 

items. In addition to the laws listed at 

FAR 12.505 as specifically inapplicable 

to COTS items, the following laws are 

inapplicable to contracts or subcontracts 

for the acquisition of COTS items: 

(1) Paragraph (a)(1) of 10 U.S.C. 

2533b, Requirement to buy strategic 

materials critical to national security 

from American sources, except as 

provided at 225.7003–3(b)(2)(i). 

(2) Section 941 of the National 

Defense Authorization Act for Fiscal 

Year 2013 (Reports to Department of 

Defense on penetration of networks and 

information systems of certain 

contractors) and section 1632 of the 

National Defense Authorization Act for 

Fiscal year 2015 (Reporting on cyber 

incidents with respect to networks and 

information systems of operationally 

critical contractors). 

PART 219—SMALL BUSINESS 

PROGRAMS 

■ 8. Amend section 219.811–3 by 

revising paragraph (2) to read as follows: 

219.811–3 Contract clauses. 

* * * * * 

(2) Use the clause at 252.219–7010, 

Notification of Competition Limited to 

Eligible 8(a) Concerns-Partnership 

Agreement, in lieu of the clause at FAR 

52.219–18, Notification of Competition 

Limited to Eligible 8(a) Concerns, in 

competitive solicitations and contracts, 

excluding solicitations and contracts 

using FAR part 12 procedures for the 

acquisition of commercial items, when 

the acquisition is accomplished using 

the procedures of FAR 19.805 and 

processed in accordance with the 

partnership agreement cited in 219.800. 

* * * * * 

PART 252—SOLICITATION 

PROVISIONS AND CONTRACT 

CLAUSES 

■ 9. Amend section 252.204–7009 by— 

■ a. Removing the clause date of ‘‘(OCT 

2016)’’ and adding ‘‘(DATE)’’ in its 

place; and 

■ b. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order to read as follows: 

252.204–7009 Limitations on the Use or 

Disclosure of Third-Party Contractor 

Reported Cyber Incident Information. 

* * * * * 

(a) * * * 

Subcontract, as used in paragraph (c) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

■ 10. Amend section 252.204–7012 by— 

■ a. Removing the clause date of ‘‘(OCT 

2016)’’ and adding ‘‘(DATE)’’ in its 

place; and 

■ b. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order; and 

■ c. Revising paragraph (m)(1). 

The addition and revision reads as 

follows: 

252.204–7012 Safeguarding Covered 

Defense Information and Cyber Incident 

Reporting. 

* * * * * 

(a) * * * 

Subcontract, as used in paragraph (m) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

(m) * * * 

(1) Include this clause, including this 

paragraph (m), without alteration except 

to identify the parties, in subcontracts, 

or similar contractual instruments, for 

operationally critical support, or for 


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which subcontract performance will 

involve covered defense information, 

including subcontracts for commercial 

items, except subcontracts for 

commercially available off-the-shelf 

items. The Contractor shall determine if 

the information required for 

subcontractor performance retains its 

identity as covered defense information 

and will require protection under this 

clause, and, if necessary, consult with 

the Contracting Officer; and 

* * * * * 

■ 11. Amend section 252.204–7014 by— 

■ a. Removing the clause date of ‘‘(MAY 

2016)’’ and adding ‘‘(DATE)’’ in its 

place; and 

■ b. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order to read as follows: 

252.204–7014 Limitations on the Use or 

Disclosure of Information by Litigation 

Support Contractors. 

* * * * * 

(a) * * * 

Subcontract, as used in paragraph (f) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

■ 12. Amend section 252.204–7015 by— 

■ a. Removing the clause date of ‘‘(MAY 

2016)’’ and adding ‘‘(DATE)’’ in its 

place; and 

■ b. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order to read as follows: 

252.204–7015 Notice of Authorized 

Disclosure of Information for Litigation 

Support. 

* * * * * 

(a) * * * 

Subcontract, as used in paragraph (c) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

■ 13. Amend section 252.211–7003 by— 

■ a. Removing the clause date of ‘‘(MAR 

2016)’’ and adding ‘‘(DATE)’’ in its 

place; and 

■ b. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order to read as follows: 

252.211–7003 Item Unique Identification 

and Valuation. 

* * * * * 

(a) * * * 

Subcontract, as used in paragraph (g) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3) 

* * * * * 

■ 14. Amend section 252.223–7008 by— 

■ a. Removing the clause date of ‘‘(JUN 

2013)’’ and adding ‘‘(DATE)’’ in its 

place; and 

■ b. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order to read as follows: 

252.223–7008 Prohibition of Hexavalent 

Chromium. 

* * * * * 

(a) * * * 

Subcontract, as used in paragraph (d) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

■ 15. Amend section 252.225–7009 by— 

■ a. Removing the clause date of ‘‘(OCT 

2014)’’ and adding ‘‘(DATE)’’ in its 

place; and 

■ b. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order to read as follows: 

252.225–7009 Restriction on Acquisition 

of Certain Articles Containing Specialty 

Metals. 

* * * * * 

(a) * * * 

Subcontract, as used in paragraph (e) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

■ 16. Amend section 252.225–7039 by— 

■ a. Removing the clause date of ‘‘(JUN 

2016)’’ and adding ‘‘(DATE)’’ in its 

place; and 

■ b. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order to read as follows: 

252.225–7039 Defense Contractors 

Performing Private Security Functions 

Outside the United States. 

* * * * * 

(a) * * * 

Subcontract, as used in paragraph (f) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

■ 17. Amend section 252.229–7014 by— 

■ a. Removing the clause date of ‘‘(DEC 

2015)’’ and adding ‘‘(DATE)’’ in its 

place; 

■ b. Redesignating paragraph (b) as 

paragraph (b)(2); 


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■ c. Redesignating paragraph (a) as 

paragraph (b)(1); 

■ d. Adding a new paragraph (a); 

■ e. In paragraph (e), adding a paragraph 

heading. 

The additions read as follows: 

252.229–7014 Taxes—Foreign Contracts in 

Afghanistan. 

* * * * * 

(a) Definition. As used in this clause— 

Subcontract, as used in paragraph (e) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

* * * * * 

(e) Subcontracts. * * * 

* * * * * 

■ 18. Amend section 252.229–7015 by— 

■ a. Removing the clause date of ‘‘(DEC 

2015)’’ and adding ‘‘(DATE)’’ in its 

place; 

■ b. Redesignating paragraph (b) as 

paragraph (b)(2); 

■ c. Redesignating paragraph (a) as 

paragraph (b)(1); 

■ d. Adding a new paragraph (a); 

■ e. In paragraph (e), adding a paragraph 

heading. 

The additions read as follows: 

252.229–7015 Taxes—Foreign Contracts in 

Afghanistan (North Atlantic Treaty 

Organization Status of Forces Agreement). 

* * * * * 

(a) Definition. As used in this clause— 

Subcontract, as used in paragraph (e) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

(e) Subcontracts. * * * 

* * * * * 

■ 19. Amend 252.237–7010 Prohibition 

on Interrogation of Detainees by 

Contractor Personnel by— 

■ a. Removing the clause date of ‘‘(JUN 

2013)’’ and adding ‘‘(DATE)’’ in its 

place; and 

■ b. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order to read as follows: 

252.237–7010 Prohibition on Interrogation 

of Detainees by Contractor Personnel. 

* * * * * 

(a) * * * 

Subcontract, as used in paragraph (c) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

■ 20. Amend section 252.237–7019 by— 

■ a. Removing the clause date of ‘‘(JUN 

2013)’’ and adding ‘‘(DATE)’’ in its 

place; and 

■ b. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order to read as follows: 

252.237–7019 Training for Contractor 

Personnel Interacting with Detainees. 

* * * * * 

(a) * * * 

Subcontract, as used in paragraph (c) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

■ 21. Amend section 252.239–7010 by— 

■ a. Removing the clause date of ‘‘(OCT 

2016)’’ and adding ‘‘(DATE)’’ in its 

place; and 

■ b. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order to read as follows: 

252.239–7010 Cloud Computing Services. 

* * * * * 

(a) * * * 

Subcontract, as used in paragraph (l) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

■ 22. Amend section 252.244–7000 by— 

■ a. Removing the clause date of ‘‘(JUN 

2013)’’ and adding ‘‘(DATE)’’ in its 

place; 

■ b. Removing paragraph (b); 

■ c. Redesignating paragraph (a) as 

paragraph (b); 

■ d. Adding a new paragraph (a); 

■ e. Revising the newly redesignated 

paragraph (b); and 

■ f. In paragraph (c), adding a paragraph 

heading. 

The additions read as follows: 

252.244–7000 Subcontracts for 

Commercial Items. 

* * * * * 

(a) Definition. As used in this clause— 

Subcontract means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

(b) The Contractor shall not flow 

down the terms of any Federal 

Acquisition Regulation (FAR) clause or 

Defense Federal Acquisition Regulation 

Supplement (DFARS) clause in 

subcontracts for commercial items at 

any tier under this contract, unless— 

(1) For DFARS clauses, it is so 

specified in the particular clause; or 


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Federal Register / Vol. 83, No. 126 / Friday, June 29, 2018 / Proposed Rules 30655 

(2) For FAR clauses, the clause is 

listed at FAR 12.301(d) or it is so 

specified in paragraph (e)(1) of the 

clause at FAR 52.212–5 or paragraph 

(b)(1) of the clause at FAR 542.244–6, as 

applicable. 

(c) Subcontracts. * * * 

* * * * * 

■ 23. Amend section 252.246–7003 by— 

■ a. Removing the clause date of ‘‘(JUN 

2013)’’ and adding ‘‘(DATE)’’ in its 

place; 

■ b. In paragraph (a) adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order and revising the 

definition of ‘‘Subcontractor; 

■ c. In paragraph (f)(1), adding a 

paragraph heading. 

The additions and revision read as 

follows: 

252.246–7003 Notification of Potential 

Safety Issues. 

* * * * * 

(a) * * * 

Subcontract, as used in paragraph (f) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

Subcontractor means any supplier, 

distributor, or vendor at any level below 

the prime contractor whose contractual 

obligation to perform results from, or is 

conditioned upon, award of the prime 

contract and who is performing any part 

of the work or other requirement of the 

prime contract. 

* * * * * 

(f)(1) Subcontracts. * * * 

* * * * * 

■ 24. Amend section 252.246–7007 by— 

■ a. Removing the clause date of ‘‘(AUG 

2016)’’ and adding ‘‘(DATE)’’ in its 

place; 

■ b. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order; 

■ c. In paragraph (c)(9), removing 

‘‘subcontractors’’ and adding 

‘‘subcontractors or other suppliers’’ in 

its place; and 

■ d. Revising paragraph (e). 

The addition and revision read as 

follows: 

252.246–7007 Contractor Counterfeit 

Electronic Part Detection and Avoidance 

System. 

* * * * * 

(a) * * * 

Subcontract, as used in paragraph (e) 

of this clause, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

(e) Subcontracts. The Contractor shall 

include the substance of this clause, 

excluding the introductory text and 

including only paragraphs (a) through 

(e), in subcontracts and other 

contractual instruments, including 

subcontracts and other contractual 

instruments for commercial items, that 

are for electronic parts or assemblies 

containing electronic parts. 

* * * * * 

■ 25. Amend section 252.246–7008 by— 

■ a. Removing the clause date of ‘‘(DEC 

2017)’’ and adding ‘‘(DATE)’’ in its 

place; 

■ b. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order; 

■ c. In paragraph (b)(3)(i)(A)(2), 

removing ‘‘subcontractor’’ and adding 

‘‘subcontractor or other supplier’’ in its 

place; and 

■ d. Revising paragraph (e). 

The addition and revision read as 

follows: 

252.246–7008 Sources of Electronic Parts. 

* * * * * 

(a) * * * 

Subcontract means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

(e) Subcontracts and other 

contractual instruments. The Contractor 

shall include the substance of this 

clause, including this paragraph (e), in 

subcontracts and other contractual 

instruments, including subcontracts and 

other contractual instruments for 

commercial items, that are for electronic 

parts or assemblies containing 

electronic parts, unless the 

subcontractor or supplier is the original 

manufacturer. 

* * * * * 

■ 26. Amend section 252.247–7003 by— 

■ a. Removing the clause date of ‘‘(JUN 

2013)’’ and adding ‘‘(DATE)’’ in its 

place; 

■ b. Redesignating paragraphs (a), (b), 

and (c) as paragraphs (b), (c), and (d); 

■ c. Adding a new paragraph (a); and 

■ d. In the newly redesignated 

paragraph (d), adding a paragraph 

heading. 

The additions read as follows: 

252.247–7003 Pass-Through of Motor 

Carrier Fuel Surcharge Adjustment to the 

Cost Bearer. 

* * * * * 

(a) Definitions. As used in this 

clause— 

Subcontract, as used in paragraph (d) 

of this contract, means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

(d) Subcontracts. * * * 

* * * * * 

■ 27. Amend section 252.247–7023 by— 

■ a. Removing the clause date of ‘‘(APR 

2014)’’ and adding ‘‘(DATE)’’ in its 

place; 

■ b. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order; and 

■ c. In paragraph (h), adding a new 

paragraph heading. 

■ d. In Alternate I— 

■ i. Removing the clause date of ‘‘(APR 

2014)’’ and adding ‘‘(DATE)’’ in its 

place; 


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30656 Federal Register / Vol. 83, No. 126 / Friday, June 29, 2018 / Proposed Rules 

■ ii. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order; and 

■ iii. In paragraph (h), adding a new 

paragraph heading. 

■ e. In Alternate II— 

■ i. Removing the clause date of ‘‘(APR 

2014)’’ and adding ‘‘(DATE)’’ in its 

place; 

■ ii. In paragraph (a), adding the 

definition of ‘‘Subcontract’’ in 

alphabetical order; and 

■ iii. In paragraph (h), adding a new 

paragraph heading. 

The additions read as follows: 

252.247–7023 Transportation of Supplies 

by Sea. 

* * * * * 

(a) * * * 

Subcontract means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

* * * * * 

(h) Subcontracts. * * * 

* * * * * 

Alternate I. * * * 

* * * * * 

(a) * * * 

Subcontract means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

(h) Subcontracts. * * * 

* * * * * 

Alternate II. * * * 

* * * * * 

(a) * * * 

Subcontract means any contract, as 

defined in FAR subpart 2.1, entered into 

by a subcontractor to furnish supplies or 

services for performance of a prime 

contract or a subcontract. The term— 

(1) Includes a transfer of commercial 

items between divisions, subsidiaries, or 

affiliates of a contractors or 

subcontractor; and 

(2) Does not include agreements 

entered into by a contractor for the 

supply of commodities that are intended 

for use in the performance of multiple 

contracts with the Department of 

Defense and other parties and are not 

identifiable to any particular contract. 

(10 U.S.C. 2375(c)(3)) 

* * * * * 

(h) Subcontracts. * * * 

* * * * * 

[FR Doc. 2018–14043 Filed 6–28–18; 8:45 am] 

BILLING CODE 5001–06–P 

DEPARTMENT OF DEFENSE 

Defense Acquisition Regulations 

System 

48 CFR Parts 215 and 252 

[Docket DARS–2018–0008] 

RIN 0750–AJ19 

Defense Federal Acquisition 

Regulation Supplement: Only One 

Offer (DFARS Case 2017–D009) 

AGENCY: Defense Acquisition 

Regulations System, Department of 

Defense (DoD). 

ACTION: Proposed rule. 

SUMMARY: DoD is proposing to amend 

the Defense Federal Acquisition 

Regulation Supplement (DFARS) to 

partially implement a section of the 

National Defense Authorization Act for 

Fiscal Year 2017 to address the 

requirement for certification of cost or 

pricing data and potential submission of 

additional certified cost or pricing data 

when only one offer is received in 

response to a competitive solicitation. 

DATES: Comments on the proposed rule 

should be submitted in writing to the 

address shown below on or before 

August 28, 2018, to be considered in the 

formation of a final rule. 

ADDRESSES: Submit comments 

identified by DFARS Case 2017–D009, 

using any of the following methods: 

Æ Federal eRulemaking Portal: http:// 

www.regulations.gov. Search for 

‘‘DFARS Case 2017–D009.’’ Select 

‘‘Comment Now’’ and follow the 

instructions provided to submit a 

comment. Please include ‘‘DFARS Case 

2017–D009’’ on any attached document. 

Æ Email: osd.dfars@mail.mil. Include 

DFARS Case 2017–D009 in the subject 

line of the message. 

Æ Fax: 571–372–6094. 

Æ Mail: Defense Acquisition 

Regulations System, Attn: Ms. Amy 

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

Room 3B941, 3060 Defense Pentagon, 

Washington, DC 20301–3060. 

Comments received generally will be 

posted without change to http://

www.regulations.gov, including any 

personal information provided. To 

confirm receipt of your comment(s), 

please check www.regulations.gov, 

approximately 2 to 3 days after 

submission to verify posting (except 

allow 30 days for posting of comments 

submitted by mail). 

FOR FURTHER INFORMATION CONTACT: Ms. 

Amy G. Williams, telephone 571–372– 

6106. 

SUPPLEMENTARY INFORMATION: 

I. Background 

DoD is proposing to revise the DFARS 

to partially implement section 822 of 

the National Defense Authorization Act 

(NDAA) for Fiscal Year (FY) 2017 (Pub. 

L. 114–328) to (1) address the potential 

requirement for certification of cost or 

pricing data and potential requirement 

for additional certified cost or pricing 

data when only one offer is received in 

response to a competitive solicitation 

and (2) make prime contractors 

responsible for determining whether a 

subcontract qualifies for an exception 

from the requirement for submission of 

certified cost based on adequate price 

competition. This DFARS rule 

supplements the rule proposed under 

FAR Case 2017–006, Exception from 

Certified Cost or Pricing Data 

Requirements-Adequate Price 

Competition, which proposes to modify 

the standards for adequate price 

competition at FAR 15.403–1(c) for 

DoD, NASA, and the Coast Guard (83 FR 

27303, June 12, 2018). Section 822 

requires that for DoD, NASA, and the 

Coast Guard, adequate price 

competition requires a price that is 

based on adequate competition that 

results in at least two or more 

responsive and viable offers from 

independently competing offerors. 

II. Discussion and Analysis 

A. Current DFARS 

DoD published a final rule in the 

Federal Register on June 29, 2012 (77 

FR 39126) to address acquisitions using 

competitive procedures in which only 

one offer is received (DFARS Case 

2011–D013). That rule was initiated to 

implement one of the aspects of the 

initiative on promoting real competition 

that was presented by the Under 

Secretary of Defense for Acquisition, 

Technology, and Logistics in the 


sradovich on DSK3GMQ082PROD with PROPOSALS