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[Federal Register Volume 77, Number 126 (Friday, June 29, 2012)]
[Rules and Regulations]
[Pages 39125-39139]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-15569]

[[Page 39125]]

Vol. 77

Friday,

No. 126

June 29, 2012

Part IV

Department of Defense

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Defense Acquisition Regulations System

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48 CFR Parts 205, 208, 212, et al.

Defense Acquisition Regulations System; Defense Federal Acquisition 
Regulation Supplement; Only One Offer (DFARS Case 2011-D013); Defense 
Federal Acquisition Regulation Supplement: Shipping Instructions (DFARS 
Case 2011-D052) and Defense Federal Acquisition Regulation Supplement: 
Applicability of Hexavalent Chromium Policy to Commercial Items (DFARS 
Case 2011-D047); Final Rules

Federal Register / Vol. 77 , No. 126 / Friday, June 29, 2012 / Rules 
and Regulations

[[Page 39126]]

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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 205, 208, 212, 214, 215, 216, 252

RIN 0750-AH11

Defense Acquisition Regulations System; Defense Federal 
Acquisition Regulation Supplement; Only One Offer (DFARS Case 2011-
D013)

AGENCY: Defense Acquisition Regulations System, Department of Defense 
(DoD).

ACTION: Final rule.

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SUMMARY: DoD is issuing a final rule amending the Defense Federal 
Acquisition Regulation Supplement (DFARS) to address acquisitions using 
competitive procedures in which only one offer is received. This rule 
implements a DoD Better Buying Power initiative. The revisions to this 
rule are part of DoD's retrospective plan under Executive Order 13563 
completed in August 2011.

DATES: Effective Date: June 29, 2012.

FOR FURTHER INFORMATION CONTACT: Ms. Amy G. Williams, telephone 571-
372-6106.

SUPPLEMENTARY INFORMATION: DoD's full plan can be accessed at http://exchange.regulations.gov/exchange/topic/eo-13563.

I. Background

    DoD published a proposed rule in the Federal Register at 76 FR 
44293 on July 25, 2011, to address acquisitions using competitive 
procedures in which only one offer is received. This 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 (AT&L) in a memorandum dated 
November 3, 2010. This memorandum was further implemented by memoranda 
from the Director, Defense Procurement and Acquisition Policy, dated 
November 24, 2010, and April 27, 2011.
    Some of the other background events leading up to publication of 
this rule are summarized as follows:
     In 2007, an Acquisition Advisory (SARA) panel report 
discussed methods to encourage competition focused on longer 
solicitation periods as well as improved requirements generation and 
market research/industry communication.
     In 2008, the Office of Management and Budget and Office of 
Federal Procurement Policy issued a memorandum detailing agencies' 
efforts to improve competition where only one offer was received. These 
efforts involved such steps as limiting contract length, minimizing 
unique or brand name specifications, and enhancing acquisition 
planning.
     In 2010, the Government Accountability Office studied 
reasons why only one offer is received, and concluded that several 
factors contributed, such as a strong incumbent, restrictive Government 
requirements, and/or bundling of requirements into larger acquisitions.
    The comment period closed on September 23, 2011, but was re-opened 
on September 27, 2011 (76 FR 59623) through October 7, 2011. DoD 
received comments on the proposed rule from 19 respondents.

II. Discussion and Analysis of the Public Comments

    DoD reviewed the public comments in the development of the final 
rule. A discussion of the comments and the changes made to the rule as 
a result of those comments are provided as follows:

 A. Summary of Significant Changes From the Proposed Rule

    1. DFARS 215.371-1. A section on policy has been added at DFARS 
215.371-1 to replace the proposed paragraph DFARS 215.371(a). The 
policy statement is completely rewritten to shift the emphasis away 
from whether the circumstances described at FAR 15.403-1(c)(1)(ii) 
constitute adequate price competition, to an emphasis on the objectives 
of the rule, i.e., to increase competition and, if only one offer is 
received nevertheless, to make sure that the price is fair and 
reasonable and that the statutory requirements for obtaining certified 
cost or pricing data are met.
    2. DFARS 215.371-2. A section has been added to address the efforts 
to promote competition, similar to the coverage in the proposed rule at 
DFARS 215.371(c)(1). In response to public comments, two FAR references 
have been added to provide considerations on revising requirements to 
promote competition (FAR 6.502(b) and 11.002).
    3. DFARS 215.371-3 has been added to address the process for 
obtaining fair and reasonable prices, replacing the proposed paragraph 
DFARS 215.371(c)(2). The contracting officer is not required to obtain 
further cost or pricing data if the contracting officer determines that 
the offered price is fair and reasonable on the basis of cost or price 
analysis and that adequate price competition exists, in accordance with 
FAR 15.403-1(c)(1)(ii), or another exception to the statutory 
requirement for certified cost or pricing data applies (see Truth in 
Negotiations Act (10 U.S.C. 2306a) and FAR 15.403-4). Otherwise, the 
contracting officer must obtain additional cost or pricing data, and 
that data must be certified, unless an exception to the requirement for 
certified cost or pricing data applies. The following table provides a 
summary of the requirement for cost or pricing data and whether the 
data must be certified, depending on whether the contracting officer 
can determine the price to be fair and reasonable and whether an 
exception to the requirement for certified cost or pricing data 
applies.

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                                         Circumstance 1          Circumstance 2          Circumstance 3         Circumstance 4         Circumstance 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
Contracting officer (c.o.)           YES...................  YES...................  YES..................  NO...................  NO
 determines price fair &
 reasonable?
C.o. determines adequate price       YES...................  NO....................  NO...................  X*...................  X
 competition? (approved 1 level
 above c.o.)
Another TINA exception applies?      ......................  YES...................  NO...................  YES..................  NO
Cost or pricing data required?       NO....................  NO....................  YES..................  YES..................  YES

[[Page 39127]]

 
Data must be certified?              N/A...................  N/A...................  YES..................  NO...................  YES
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Note that the contracting officer cannot determine that adequate price competition exists if cannot determine that the price is fair and reasonable.

    4. Two exceptions have been added at DFARS 215.371-4 (proposed at 
DFARS 215.371(e)):
     An exception to the 30-day resolicitation period has been 
added to address the application to small business set-asides.
     The final rule states that it does not apply to broad 
agency announcements.
    5. Waivers are now addressed at DFARS 215.371-5 (proposed at DFARS 
215.371(d)), but the coverage of waivers is otherwise unchanged.
    6. The proposed statement at DFARS 215.403-1(c)(1)(B) has been 
modified to reference back to the procedures at DFARS 215.371-3 for 
ensuring a fair and reasonable price if only one offer is received. 
DFARS 215.371-3 makes it clear that adequate price competition, as 
described at FAR 15.403-1(c)(1)(ii), cannot be used for the purpose of 
determining that a price is fair and reasonable.
    7. The rule no longer addresses acquisitions under FAR subpart 
13.5, because that statutory authority has expired.
    8. Statements have been added at DFARS 208.404(a) and 214.404-1(2) 
to specify clearly the deviation from the statements in the 
corresponding FAR sections.

 B. Analysis of Public Comments

1. Meaning of ``Only One Offer''
    Comment: One respondent stated that what constitutes one offer 
should be more clearly defined. The respondent questioned whether this 
includes only technically acceptable, timely offers.
    Response: For the purpose of DFARS 215.371, an offer includes any 
timely offer or late offer accepted by the contracting officer. There 
is no requirement for each offer to meet the requirements at FAR 
15.403-1(c)(1)(i) in order to count as more than one offer received. 
However, if after evaluations the contracting officer determines only 
one responsive offer was received, the contracting officer will need to 
review the standards at FAR 15.403-1(c) to determine if adequate price 
competition exists or another exception applies, and take the 
appropriate steps to ensure a fair and reasonable price.
    Comment: One respondent questioned whether this rule is applicable 
to the solicitation of quotations. The respondent noted that quotations 
are solicited routinely when using the procedures of FAR subpart 8.4.
    Response: This rule is applicable to quotes as well as offers. 
Quotes should be treated the same as offers, for the purposes of this 
rule. The term ``offer'' used in the provision is comprehensive enough 
to apply to all competitive acquisitions subject to the final rule. 
Specifically, the term ``offer'' appropriately applies to acquisitions 
exceeding the simplified acquisition threshold conducted under FAR 
parts 8, 12, 14, 15, and 16. FAR defines ``offer'' to include responses 
to invitations for bids (sealed bidding) and responses to requests for 
proposals (negotiation), but to exclude responses to requests for 
quotations (RFQs). However, DFARS parts 208 and 216 already use the 
term ``offer'' in reference to orders awarded under those subparts. 
Finally, the final rule does not apply to acquisitions below the 
simplified acquisition threshold awarded based on quotations received. 
Therefore, the provisions in the final rule, because they use the term 
``offer,'' can be used appropriately for competitions under FAR parts 
8, 12, 14, 15, and 16 exceeding the simplified acquisition threshold.
2. Promoting Competition
a. General
    Comment: One respondent asked whether the policy should promote the 
receipt of two or more offers on all competitive procedures exceeding 
the simplified acquisition threshold.
    Response: The intent of the DoD Better Buying Power initiative is 
to promote competition on all competitive solicitations. The policy at 
DFARS 215.371-1(a) does promote the receipt of two or more offers in 
response to competitive solicitations, unless an exception applies.
    Comment: One respondent stated that the proposed rule approach to 
increasing competition ``mistakenly conflates a post-proposal 
requirement for submitting cost or pricing data after receipt of offer 
with steps needed to increase DoD competition, but does nothing to 
address the root causes of the lack of competition.''
    Response: The rule requires the contracting officer to consult with 
the requiring activity as to whether the requirement should be revised 
in order to promote more competition and requires resolicitation if the 
solicitation allowed fewer than 30 days for receipt of proposals. The 
post-proposal requirement for cost or pricing data addresses the second 
objective of the rule--to obtain fair and reasonable prices.
    Comment: One respondent stated that the rule may result in 
decreased competition. This respondent pointed to unintended reduction 
in the number of competitors and in the ability to maintain long term 
strategic defense capabilities, because of a shift to ``lowest price 
possible.'' Further, according to this respondent, some potential 
offerors may not be willing to participate if they may subsequently be 
required to submit cost or pricing data.
    Response: The intent of the rule is not to seek the lowest price, 
but a best value at a competitive price. If two or more offerors 
respond to a requirement or if the contracting officer determines that 
the offered price is fair and reasonable and an exception to the 
requirement for certified cost or pricing data applies, then the 
contracting officer is not required to ask for additional cost or 
pricing data.
b. Time Period for Response
    Comment: Various respondents were in favor of extending 
solicitation periods to allow potential offerors more time to assemble 
a competitive offer. One respondent stated that this is generally a 
step in the right direction, and another stated that this will likely 
result in increased competition. One respondent stated that the 
proposed 30 additional days is both reasonable and appropriate.
    Response: None required.
    Comment: One respondent stated that it is difficult to understand 
why any solicitation would be advertised for less than 30 days if not 
covered by one of the excepted circumstances. The respondent 
recommended that DoD should issue conforming instructions that all 
solicitations must comport with the rule at FAR 5.203, except as 
specified in the proposed exception at DFARS 215.371(e)(1)(ii) (now at 
215.371-4) for contingencies. FAR 5.203(c) requires agencies to allow 
at least a 30-day response time for receipt of bids or proposals from 
the date of issuance of a solicitation, if the

[[Page 39128]]

proposed contract action is expected to exceed the simplified 
acquisition threshold, except for acquisition of commercial items 
(paragraph (a)) or in the general category of ``annual forecast'' 
(paragraph (h)).
    This respondent also stated that adding transactional process time 
in all cases where only a single offer is received in response to a 
competitive solicitation is contrary to sound acquisition policy.
    Response: Federal Supply Schedules and indefinite-delivery/
indefinite-quantity contracts allow for shorter solicitation times. The 
final rule does not require added transactional time in all cases. 
Encouraging competition is sound acquisition policy. The rule also 
allows the head of the contracting activity to waive the 30-day 
solicitation requirement, when appropriate.
    Comment: One respondent was concerned that resoliciting will expose 
the fact to industry prematurely that there was only one offeror. Since 
this respondent saw little probability that the additional 30 days 
would result in additional offerors, this respondent foresaw that the 
offeror would not reduce the price, but would raise the price under the 
resolicitation.
    Response: If there is still only one offer after resolicitation and 
negotiations ensue, the rule states that the contracting officer should 
not negotiate a higher price than was originally proposed. As defined 
in FAR 2.101, ``should'' means ``an expected course of action unless 
inappropriate for a particular circumstance.'' An offeror raising the 
price because there is no competition would not be an appropriate 
reason for negotiating a higher price.
    Comment: Another respondent stated that by virtually mandating a 
30-day solicitation period, this rule will delay the acquisition of 
critical items and, in many cases, not offer any cost savings. This 
respondent recommended use of other methods than resolicitation for 
determining price reasonableness if it is believed that resolicitation 
will not result in reduced pricing.
    Response: The Government does not require that all solicitations be 
announced for 30 days. If market research indicates a commercial market 
with multiple potential offerors that will be able to respond in fewer 
than 30 days, then the contracting officer may issue the solicitation 
for fewer than 30 days. Resolicitation is used to increase competition, 
not as a method to determine price reasonableness. For specifics with 
regard to application in FAR parts 12 and 16, see also the responses in 
sections II.B.6.b. and 6.d. of this preamble.
    Comment: One respondent requested that the new rule should specify 
which parts of the DFARS are subject to the 30-day requirement.
    Response: The rule specifies the parts to which it is applicable 
(DFARS parts 205, 208, 212, 214, 215, and 216). It may apply indirectly 
to other parts to the extent that the acquisition procedures of these 
parts are used. An exception has been added to state specifically that 
the rule does not apply to broad agency announcements. An exception to 
the 30-day resolicitation requirement, if only one offer is received, 
has also been added for small business set-asides.
c. Requirements
    Comment: Several respondents agreed that encouraging revised 
statements of work in appropriate circumstances would likely result in 
increased competition, and were in favor of these proposed revisions. 
One respondent stated that the reason why only one offer was received 
in part is likely because the requirement is too restrictive in its 
content, so that rewording the requirement can facilitate more offers.
    Several respondents stated that the proposed rule did not 
adequately address the process for amending the solicitation when only 
one offer is received due to flawed solicitation requirements, 
specifications, contract types, etc. One respondent stated that DoD 
should set forth guidelines and/or criteria for determining when and 
how a solicitation should be revised.
    Response: It is a duty of the competition advocate to challenge 
requirements that are not stated in terms of functions to be performed, 
performance required, or essential physical characteristics and 
identify any condition or action that has the effect of unnecessarily 
restricting competition (FAR 6.502(b)(1)). FAR 11.002 provides policy 
on stating requirements in a way to maximize competition. A cross 
reference to these FAR citations has been added at DFARS 215.371-2(a).
3. Fair and Reasonable Prices
a. Relationship Between Adequate Price Competition and Determination of 
Fair and Reasonable Price
    FAR references:
    Current coverage at FAR 15.403-1(c) provides three circumstances in 
which a price is based on adequate price competition, for the purpose 
of deciding whether there is an exemption to the requirement for 
certified cost or pricing data:
     In the first circumstance, two or more responsible 
offerors, competing independently, submit priced offers that satisfy 
the Government's expressed requirement, if award will be made to the 
offeror whose proposal represents the best value where price is a 
substantial factor in source selection, and there is no finding that 
the price of the otherwise successful offeror is unreasonable. In this 
circumstance, there is a presumption of price reasonableness. Any 
finding that the price is unreasonable must be supported by a statement 
of the facts and approved at a level above the contracting officer.
     In the second circumstance, there was a reasonable 
expectation, based on market research, that two or more responsible 
offerors, competing independently, would submit priced offers in 
response to the solicitation's expressed requirement, even though only 
one offer is received from a responsible offeror; and the determination 
that the proposed price is based on adequate price competition and is 
reasonable, must be approved at a level above the contracting officer. 
This standard for adequate price competition was added to the two pre-
existing standards in the FAR in October 1995 (FAC 90-32) as a result 
of sections 1202 and 1251 of the Federal Acquisition Streamlining Act 
of 1994 (Pub. L. 105-355). These sections required the FAR to provide 
clear standards for application of the exceptions to the requirement 
for submission of cost or pricing data (including adequate price 
competition).
     In the third circumstance, price analysis clearly 
demonstrates that the proposed price is reasonable in comparison with 
current or recent prices for the same or similar items, adjusted to 
reflect changes in market conditions under contracts that resulted from 
adequate price competition. Note that the requirement that price 
analysis be based on contracts that resulted from adequate price 
competition does not cover buys in which the price is determined fair 
and reasonable based on certified cost or pricing data from previous 
production buys. This standard has been in the regulations since May 
1964, when adequate price competition was first addressed in the Armed 
Services Procurement Regulation (3-807.1(b)).
    Comment: One respondent fully supported DoD's proposal that 30-day 
solicitations that produce only one offer should trigger a price or 
cost analysis. This respondent stated that it has long advocated the 
position that adequate price competition does not exist where

[[Page 39129]]

only one offer is received pursuant to a competitive solicitation.
    Other respondents wanted to preserve the exception at FAR 15.403-
1(c)(1)(ii) as a valid exemption from the requirement for certified 
cost or pricing data, while some acknowledged the need for better 
enforcement of FAR 15.403-1(c)(1)(ii)(B), i.e., the need to determine 
at a level above the contracting officer that the price is reasonable.
    One respondent had reservations about the apparent elimination of 
agency discretion to find adequate price competition when a single 
offer is received, following the expectation of multiple offers. The 
respondent expressed concern that because the FAR does not reflect the 
same approach, there is a risk of confusion in the acquisition 
community. This respondent cited a GAO 2010 study, which recommended 
case-by-case analysis of single offers, not elimination of the 
discretion to find adequate price competition when a single offer is 
received. This respondent also quoted a 2009 DoD statement that ``the 
receipt of a single offer does not necessarily indicate a lack of 
competition (DoD's 2009 Competition Report).
    Several respondents stated that the current FAR reflects the 
processes required of the contracting officer to protect DoD's 
interests in a fair and reasonable price in those situations where 
competition was expected, but, for whatever reason, is not achieved.
    Another respondent considered that the requirement at FAR 15.403-
1(c)(1)(ii) has been misused, because contracting officers confuse the 
adequate price competition definition of expected competition in the 
exception as also covering the adequate price competition pricing 
method of comparing proposals in FAR 15.404-1(b)(2)(i). FAR 15.404-
1(b)(2)(i) states that one price analysis technique is ``Comparison of 
proposed prices received in response to the solicitation. Normally, 
adequate price competition establishes a fair and reasonable price (see 
FAR 15.403-1(c)(1)).'' The respondent recommended that we clarify the 
need for separate price analysis before concluding that the standard 
for adequate price competition has been met.
    Similarly, another respondent recommended more rigorous enforcement 
of the existing price reasonableness test in FAR 15.403-1(c)(1)(ii) and 
(iii) for adequate price competition, without further regulatory change 
to prohibit DoD contracting officers from using the exception. Another 
respondent concurred that the problem is not the tool but the improper 
use of the tool. The respondent recommended maintaining the standards 
at FAR 15.403-1(c)(1)(ii). A third respondent stated that current 
methods are adequate to attain the desired benefit, but without 
``completely undercutting the existing acquisition process.''
    Response: In response to public comments, DoD has reassessed the 
proposed statement of policy at DFARS 215.371 in order to better 
reflect the fundamental purpose of the rule. The policy statement at 
DFARS 215.371-1 has been revised to clarify that if only one offer is 
received in response to a competitive solicitation, it is DoD policy--
     To take the required actions to promote competition; and
     To ensure, if the steps to promote competition still do 
not result in more than one offer, a fair and reasonable price and 
compliance with the statutory requirements for certified cost or 
pricing data, unless an exception applies.
    The proposed rule statement that the circumstance of ``reasonable 
expectation * * * that two or more offerors, competing independently, 
would submit priced offers,'' as further described at FAR 15.403-
1(c)(1)(ii), does not constitute adequate price competition if only one 
offer is received'' is not included in the final rule. The second 
element in the statement of policy, which reflects one of the ultimate 
goals of the proposed rule, shifts the focus from determining the 
existence of ``adequate price competition'' to achieving a ``fair and 
reasonable price.''
    There are two citations in the FAR that have contributed to the 
confusion regarding the relationship between the determination that 
adequate price competition exists and the determination that a price is 
fair and reasonable.
    Until a recent technical amendment, FAR 15.403-1(c)(1)(ii), which 
addresses ``only one offer,'' included as a standard for adequate price 
competition the requirement that ``The determination that the proposed 
price is based on adequate price competition, is reasonable, and is 
approved at a level above the contracting officer;''. The technical 
amendment restored the original wording, which had become inadvertently 
unclear in the process of a major rewrite of FAR part 15, to read as 
follows:
    ``The determination that the proposed price is based on adequate 
price competition and is reasonable has been approved at a level above 
the contracting officer;''
    This makes it unambiguous that it is the price that must be 
reasonable, not the determination, and that this determination of 
reasonable price is an essential part of the determination that 
adequate price competition exists.
    However, FAR 15.404-1(b)(2)(i) makes the statement that ``Normally, 
adequate price competition establishes a fair and reasonable price (see 
FAR 15.403-1(c)(1)).'' This statement is overly broad. Although 
``adequate price competition'' and ``fair and reasonable price'' are 
inextricably linked, only adequate price competition as described at 
FAR 15.403-1(c)(1)(i) can be used as the basis to determine that the 
price is fair and reasonable. FAR 15.403-1(c)(1)(i) involves the 
receipt of offers from two or more responsible sources, competing 
independently. That this is what was intended at FAR 15.404-1(b)(2)(i) 
is clear from the lead-in sentence, which addresses the comparison of 
proposed prices received in response to the solicitation as a price 
analysis technique.
    The perception that ``based on adequate price competition'' can be 
used as sufficient basis to determine that a price is fair and 
reasonable is clearly untenable for the standards in FAR 15.403-
1(c)(1)(ii) and (iii), both of which require a determination of price 
reasonableness as part of the determination that adequate price 
competition exists. Since there is no adequate price competition under 
FAR 15.403-1(c)(1)(ii) until a level above the contracting officer has 
found the price to be ``reasonable,'' the determination that the price 
is fair and reasonable in the case of only one offer cannot be based on 
``adequate price competition,'' as in the case when multiple offers are 
received, but must be based on another type of cost or price analysis. 
The cost or price analysis in the case of paragraph (ii) is not subject 
to the particular restrictions imposed in paragraph (iii).
    The respondents, therefore, have a point when they state that the 
problem with the determination that ``only one offer'' can constitute 
adequate price competition lies primarily in the misuse of that 
determination as a basis to assume that the price is fair and 
reasonable.
    Therefore, DoD has revised the final rule to emphasize that, 
although FAR 15.403-1(c)(1)(ii) may be used to determine that adequate 
price competition exists for purposes of an exemption from the 
requirement to obtain certified cost or pricing data, that 
determination of adequate price competition can only be made in 
conjunction with the determination that

[[Page 39130]]

the price is fair and reasonable, based on cost or price analysis, not 
just relying on ``adequate price competition.'' If the price can be 
determined to be fair and reasonable based on cost or price analysis 
and the appropriate determination is approved at one level above the 
contracting officer that the other criteria for adequate price 
competition have been met, or another exception to the requirement for 
certified cost or pricing data applies, then there is no need for any 
additional cost or pricing data.
    Comment: One respondent expressed serious concerns that full and 
open competition is no longer the model to determine a fair and 
reasonable price when single offers are received, and that a price 
achieved through full and open competition is only a starting point for 
further negotiation.
    Response: As already stated, ``full and open competition'' (i.e., 
adequate price competition) cannot be the basis for determining a fair 
and reasonable price when only one offer is received, because the 
determination that adequate price competition exists cannot be made 
until a separate determination has been made that the price is fair and 
reasonable.
    Comment: One respondent considered it ``inexplicable'' that the 
proposed rule does not recognize the requirements of FAR 15.403-
1(c)(1)(iii) to perform price analysis as contributing to the informed 
contracting officer decision about adequate price competition and price 
reasonableness.
    Response: Although a prior memorandum of November 24, 2010, from 
the Director, Defense Procurement and Acquisition Policy (DPAP), 
included a restriction of reliance on the standard at FAR 14.303-
1(c)(1)(iii) for determining adequate price competition, the subsequent 
DPAP memorandum of April 27, 2011, and the proposed rule only 
restricted reliance on the exception at FAR 15.403-1(c)(1)(ii). 
Therefore, FAR 15.403-1(c)(1)(iii) could still be relied upon to 
determine adequate price competition, if the criteria can be met. Note 
that this exception only applies if the prices of the prior contracts 
resulted from adequate price competition.
    Comment: One respondent questioned the lack of empirical data to 
back up the statement in the September 14, 2010, Carter memo that DoD 
contracting officers were not performing cost or price analysis on 
single bid offers.
    Response: Although DoD does not have extensive data, there is 
concern based on anecdotal evidence that when there was an expectation 
of competition but only one offer was received, in too many instances 
there was not a serious independent cost or price analysis to determine 
that the price was fair and reasonable. The GAO Report of July 2010 
(GAO-10-833, Federal Contracting: Opportunities Exist to Increase 
Competition and Assess Reasons When Only One Offer Is Received), found 
that some contracting approaches (about 10 percent of sample reviewed) 
did not reflect sound procurement or management practices, including 
some with very limited documentation of the reasonableness of proposed 
prices.
b. Requirement for More Data
i. Statutory Exemptions From Requirement To Submit Certified Cost or 
Pricing Data
    Comment: Several respondents requested clarification of when data 
other than certified cost or pricing data applies. Several respondents 
were further concerned that the proposed rule conflicted with 
underlying legislation and regulation that prohibit requesting 
(certified) cost or pricing data in certain circumstances. The 
respondent requested clarification of the rule to exempt procurements 
for commercial items or procurement to which another exception applies. 
The respondent reiterated that agencies are statutorily prohibited from 
requiring certified cost or pricing data where any exception applies.
    Another respondent stated that the rule should state explicitly 
that unless a waiver is granted or it is a commercial item, the data 
would always be certified cost or pricing data. This respondent 
recommended a specific change in the final rule, adding a new paragraph 
DFARS 215.371(c)(2)(i) to specifically add the requirement to 
``Determine if an exception to certified cost or pricing data is 
necessary and/or applicable.''
    Further, another respondent stated that submission of other than 
certified cost or pricing data should never be a substitute for the 
submission of certified cost or pricing data. Accordingly, the 
respondent believed that if only one offer is received, then the 
submission of certified cost or pricing data should be required in 
order to conclude that a fair and reasonable price has been 
established.
    Response: The final rule has been revised to make it clearer when 
additional cost or pricing data is required and when that data must be 
certified. DFARS 215.371-3(b)(2)(i) states that ``For acquisitions that 
exceed the cost or pricing data threshold, if no exception at FAR 
15.403-1(c) applies, the cost or pricing data shall be certified.'' The 
rule does not override any of the statutory exemptions from the 
requirement to require certified cost or pricing data, as set forth at 
FAR 15.403-1(c).
ii. Impact of Requesting Unnecessary Additional Data
    Comment: One respondent stated that although obtaining insight into 
some single offer procurements may be appropriate, the respondent 
believes that the goal can be better achieved by better enforcing the 
existing rules. The respondent cited FAR 15.402(a)(3), which states 
that ``Contracting officers shall obtain the type and quality of data 
necessary to establish a fair and reasonable price, but not more data 
than is necessary. Requesting unnecessary data can lead to increased 
proposal preparation costs, generally extend acquisition lead time, and 
consume additional contractor and Government resources.''
    Similarly, another respondent objected that the proposed rule 
effectively shifts the burden for price reasonableness to the offeror, 
by requiring them to provide either certified cost or pricing data or 
data other than certified cost or pricing data automatically, in 
response to several new clauses authorizing the contracting officer to 
demand such data when a single offer is received. According to the 
respondent, this rule creates the de facto presumption that any single 
offer outcome is unreasonable. This respondent recommended that 
supporting data should be restricted to pricing data and prohibit the 
contracting officer from requesting cost data or profit figures (per 
the SARA panel). The respondent further stated that if cost data is 
necessary, it should not require certification.
    Several respondents feared a negative impact because of the 
proposed rule requirement for submission of cost or pricing data when 
only one offer is received.
    One respondent stated that the uncertainty at the time of offer as 
to whether cost or pricing data will later be required, imposes an 
unanticipated burden of gathering such data. The respondent was 
concerned that this uncertainty may increase prices, drive away 
competitors, especially nontraditional suppliers, from submitting 
offers, and thus increase the number of single offers received.
    Another respondent stated that the demand for additional data will 
add to the enormous industry bid and proposal cost burden. The 
respondent further stated that requiring cost or pricing data is 
contrary to sound acquisition policy

[[Page 39131]]

and will negatively impact mission performance accomplishment.
    Response: The final rule has been revised to narrow the 
circumstances in which the contracting officer will request additional 
cost or pricing data. The rule now clarifies that, in competitive 
environments when only one offer is received, the contracting officer 
is only required to obtain enough data to establish fair and reasonable 
prices and to comply with any statutory requirement for certified cost 
or pricing data. If the contracting officer determines that the 
proposed price is fair and reasonable (through cost or price analysis 
using any data from the same or similar products or services previously 
procured) and that adequate price competition exists (the determination 
approved at one level above the contracting officer) or another 
exception to the requirement for certified cost or pricing data 
applies, then no further data is required. However, if the contracting 
officer cannot make the preceding determination, then the contracting 
officer must request additional cost or pricing data, and that data 
must be certified, unless another exception to the requirement for 
certified cost or pricing data applies (e.g., commercial items, or 
below the certified cost or pricing data threshold).
    The provision at DFARS 252.215-7008 has been revised in the final 
rule so that it no longer automatically requires additional data if 
only one offer is received. The provision notifies offerors that the 
contracting officer may request additional cost or pricing data if only 
one offer was received and if additional cost or pricing data is 
required in order to determine whether the price is fair and 
reasonable. In addition, the provision has been revised so that an 
offeror, by submission of its offer, agrees to provide any data 
requested by the contracting officer in accordance with FAR 52.215-20.
c. Negotiations
    Comment: Several respondents commented on the requirement that the 
negotiated price should not exceed the offered price. One respondent 
asked whether a FAR deviation from FAR 15.306(d), Exchanges with 
offerors after establishment of the competitive range, was being 
processed for DFARS 215.371(c)(2)(ii), which states in part that ``If 
the contracting officer decides to enter negotiations, the negotiated 
price should not exceed the offered price.''
    Response: FAR 1.304 provides that agency regulations may be 
inconsistent with the FAR as provided in FAR subpart 1.4, Deviations 
from the FAR. FAR 1.404(b) provides that for DoD, class deviations are 
controlled, processed, and approved in accordance with the DFARS. DPAP 
is the approval authority for class deviations or changes to the DFARS 
that constitute a permanent deviation from the FAR. Incorporation of a 
policy or procedures in the DFARS is sufficient to establish that a 
policy or procedure different from the FAR is applicable to DoD. DoD 
only processes a deviation from the FAR as a separate document when 
there is insufficient time to incorporate the changes in the DFARS or 
the incorporation in the DFARS is inappropriate for some other reason.
    Comment: One respondent stated that both discussions and 
negotiations could reveal errors that would lead to revised proposals 
either lower or higher than the offered price. Additionally, the 
respondent expressed concern that the definition of ``should'' is 
different to each individual. Another respondent recommended striking 
the limitation that negotiated price should not exceed offered price 
from paragraph (c) of proposed DFARS 252.215-70XX.
    Response: The term ``should'' is defined at FAR 2.101 (see response 
to third comment under section II.B.2.b.). If discussions or 
negotiations reveal errors that would lead to revised proposals, then 
that could constitute sufficient rationale to diverge from the norm of 
``should'' and negotiate a higher price.
    Comment: One respondent cited the 20 percent likelihood that there 
will be only one offer as cause for offerors to back away from making 
an initial offer, because if there is only one offer, then the offeror 
will be forced to negotiate further with their offered price as 
ceiling. The respondent also sees an impact on contracting officers 
because of the difference between the FAR and the DFARS, causing ``more 
confusion among DoD contracting officers about the negotiation 
process.''
    Response: The rule has been revised so that negotiations only ensue 
when the contracting officer cannot determine that the offered price is 
fair and reasonable (also see response to previous section 
II.B.3.b.ii.).
    Comment: One respondent had some technical comment with regard to 
entering negotiations under DFARS part 214. The respondent recommended 
inclusion of several references (at DFARS 214.404-1(1) and (2) and 
214.408-1(b)) to FAR 14.404-1(f), which allows sealed bidding to 
convert to negotiated in lieu of cancellation required by FAR 14.404-
1(c).
    Response: The DFARS supplementation of FAR 14.404-1 has added a 
reference to FAR 15.404-1(f) to clarify that the DFARS procedures at 
DFARS 215.371 supersede the procedures at FAR 14.404-1(f).
4. Exceptions in Proposed Rule
a. Simplified Acquisition Threshold
    Comment: Three respondents recommended increasing the proposed 
threshold for application of the rule from the simplified acquisition 
threshold to $10 million. One respondent stated that the rule should 
exempt acquisitions less than $10 million, in order to return the 
highest level of benefit from the burdens imposed by submission of cost 
or pricing data and negotiation.
    Similarly, another respondent recommended the $10 million threshold 
in order to focus the requirements on the competitions in which 
fostering effective competition would have the most beneficial impact 
to DoD and for which a failure to perform adequate cost or price 
analysis of single offers could result in the most detriment to DoD.
    A third respondent provided the rationale that, especially for 
procurement of services, for many procurements of less than $10 million 
associated with re-competes, other contractors determine that based on 
a cost-benefit analysis, the cost of writing and submitting a proposal 
exceed the potential benefits associated with the acquisition.
    Response: The simplified acquisition threshold is currently 
$150,000, with higher thresholds for contingency operations or to 
facilitate the defense against nuclear, biological, chemical, or 
radiological attack (which are exempt from this rule). Another possible 
threshold that was considered is the threshold for certified cost or 
pricing data ($650,000). DoD decided to retain the simplified 
acquisition threshold as the threshold for application of this rule. It 
is not to the benefit of DoD to exempt acquisitions up to $10 million 
from this rule, or even $650,000, especially as the final rule has been 
revised to eliminate any unnecessary burden. It is important at every 
dollar value to maximize competition and determine that prices are fair 
and reasonable. The primary reasons that buys below the simplified 
acquisition threshold have been exempted from this rule are because--
     41 U.S.C. 1901 requires that in order to ``promote 
efficiency and economy in contracting and to avoid unnecessary 
burdens,'' the FAR shall provide simplified procedures for acquisitions 
not greater than the simplified acquisition threshold; and

[[Page 39132]]

     It is simply not feasible to apply the rule to the huge 
volume of very low dollar value buys, a large majority of which are 
conducted electronically.
b. Contingency Contracting
    Comment: One respondent viewed the exception for contingency 
contracting as a serious defect. The respondent referenced the 
Commission on Wartime Contracting as evidence that DoD's non-
competitive procurement practices in contingency operations have 
resulted in billions of dollars of waste. The respondent, therefore, 
recommended that either the exception be deleted, or a rigorous set of 
guidelines be included in the final rule, to limit the instances in 
which such an exception could be granted.
    Response: An exception for actions in support of contingency 
operations is provided due to the urgent nature of actions and the need 
for flexibility in theater in order to remain responsive. Application 
of the exception does not eliminate the need for the contracting 
officer to seek maximum practicable competition and ensure that the 
price is fair and reasonable. The intent of the proposed rule is to 
drive behavior to enhance real competition whenever possible and to 
obtain a fair and reasonable price. To establish a rigorous set of 
guidelines to limit instances in which an exception could be granted in 
a contingency environment could severely limit the flexibility of the 
contracting officer in these instances. DoD is also reviewing the 
findings/recommendations of the Commission on Wartime Contracting and 
placement of additional safeguards and remedies to promote competition 
in a contingency environment.
5. Waiver
    Comment: One respondent criticized the waiver provision for being 
``unlimited'' and imposing ``no restrictions or guidance on when or how 
the head of the contracting activity should exercise this authority. 
According to this respondent, if there are no reasonable restrictions 
on granting of waivers, then it is unlikely that DoD's practice will 
change.
    Response: The requirement to resolicit for an additional 30 days 
may be waived by the head of the contracting activity (HCA). The intent 
of including this waiver provision is to maintain flexibility and allow 
the HCA to exercise the authority of the position. Typically, this 
position is filled by a senior acquisition professional who has 
demonstrated sound business judgment and acumen. DoD relies on those in 
charge to exercise good judgment in the execution of their duties. This 
waiver authority cannot be delegated below one level above the 
contracting officer. DoD has not seen evidence of abuse of this waiver 
authority.
    Comment: One respondent recommended that the rule should allow 
requesting a waiver of the requirement to resolicit for an additional 
30 days if the contracting officer has determined fair and reasonable 
prices through price or cost analysis or negotiations with the offeror, 
and the waiver has been approved by the PARC (Principal Assistant 
Responsible for Contracting).
    Response: The purpose of the 30-day resolicitation requirement is 
to promote effective competition. Determination that the offered price 
is fair and reasonable may provide supporting rationale for granting a 
waiver, but does not by itself constitute sufficient grounds to grant a 
waiver. More important reasons for granting a waiver would be urgency 
of the requirement or market research that indicates that an additional 
30 days is unlikely to result in additional offers.
    The final rule continues to allow the waiver authority to be 
delegated to one level above the contracting officer (which would 
include the PARC). An approval one level above the contracting officer 
ensures a layer of review and provides a mechanism for checks and 
balances. Waiver of the 30-day resolicitation period does not relieve 
the contracting officer of the need to determine the price fair and 
reasonable.
6. Applicability to Parts Other Than DFARS Parts 214 and 215
a. Part 208
    Comment: Several respondents recommended that the proposed rule 
should not apply to DFARS subpart 208.4, Federal Supply Schedules.
i. Timing and Complexity
    Comment: One respondent stated that the purpose for the GSA Federal 
Supply Schedule is to provide the Government an expedited means to 
procure commercial supplies and services at the substantially lower 
costs associated with volume buying. Therefore, expanding the DoD memos 
to DFARS subpart 208.4 (as well as DFARS parts 212, 213, and 216), 
``eviscerates their intention'' and will overload the acquisition 
process.
    Another respondent provided an example of an agency that frequently 
posts RFQs using the GSA eBuy tool for fewer than 30 days. The RFQs are 
available to all vendors on the relevant GSA schedule. Although 
multiple responses are generally received, occasionally there is only 
one quote received. According to this respondent, lengthening the RFQ 
response time to 30 days would impede the goal of simplifying and 
streamlining the procurement process.
    Response: DoD recognizes that the Federal Supply Schedule program 
directed and managed by GSA provides a simplified and flexible process 
for obtaining commercial supplies and services. The schedule program, 
because it does not require contracting officers to seek competition 
outside of the schedule holders or to synopsize the requirement, can be 
very efficient. DoD also believes that effective competition promotes 
greater efficiency and productivity in defense spending, and that DoD 
needs to do more to promote competition when only one offer is received 
in response to a competitive solicitation. The final rule requires, 
when only one offer is received in response to a competitive 
solicitation, that the contracting officer promote competition by 
trying to revise the requirements document and by permitting more time 
for receipt of offers. In addition, the final rule does not eliminate 
the efficiencies or flexibilities inherent in FAR part 8 transactions.
    RFQs using the GSA eBuy tool are frequently posted for less than 30 
days and generally receive more than one response. The final rule still 
permits requests for quotation to be solicited for fewer than 30 days, 
and only requires a resolicitation for 30 days (or a waiver) in those 
cases when only one offer was received. Market research can provide 
contracting officers the insight required to determine the solicitation 
response time required to ensure effective competition without 
needlessly lengthening the RFQ response time to 30 days. In many cases, 
market research will indicate that multiple offers will be received in 
response to an RFQ open for under 30 days. In other cases, market 
research will indicate that contracting officers need to keep RFQs open 
for 30 days to encourage effective competition. Finally, market 
research will indicate that additional time will likely not result in 
additional offers, and provide contracting officers with the rationale 
to support a waiver of the resolicitation requirement.
ii. Authority of GSA
    Comment: One respondent stated that GSA is vested with the 
exclusive statutory authority for the pricing policies and procedures 
governing contracts and orders under the Federal Supply Schedule (40 
U.S.C. chapter 5

[[Page 39133]]

and 41 U.S.C. 152(3)). Any modifications must be approved by GSA and 
incorporated into the General Services Acquisition Regulation (GSAR).
    Response: DoD understands GSA's exclusive statutory authority for 
directing and managing the Federal Supply Schedule (FSS) program, and 
is not modifying the FSS program with this final rule. Instead, the 
final rule merely supplements GSA's existing guidance on the FSS 
program to ensure FSS program use by DoD contracting officers is 
consistent with DoD's policies for promoting competition. Specifically, 
the final rule augments GSA's policies and procedures for the FSS 
program by providing DoD contracting officers specific instructions 
when only one offer is received in response to a competitive FSS 
solicitation. DoD has periodically issued additional guidance and 
instructions to govern use of the FSS within DoD.
iii. Sufficiency of FAR and GSAR Processes
    Comment: According to several respondents, the proposed regulations 
are unnecessarily duplicative, because the FAR and the GSAR already 
provide a framework for the effective and efficient procurement of 
goods and services at fair and reasonable prices. The respondents noted 
that under the FSS, GSA has already determined that the prices for 
products and the rates for services are fair and reasonable (FAR 
8.404(d)). According to the respondents, ordering agencies are not 
required to make a separate determination of fair and reasonable prices 
of supplies and fixed price services, except for a price evaluation as 
required by FAR 8.405-2(d). In such cases, agencies are only 
responsible for considering the level of effort and labor mix and 
making a determination whether the total price is fair and reasonable.
    Response: Existing regulations already anticipate that contracting 
officers can achieve prices below those determined fair and reasonable 
by GSA by pursuing additional competition and/or price negotiations. 
Even though GSA has already negotiated fair and reasonable pricing 
under the FSS program, the FAR permits contracting officers to seek 
additional discounts before placing an order. Agencies are required to 
seek price reductions from the fair and reasonable contract prices for 
orders exceeding the simplified acquisition threshold (see FAR 8.405-
4). As a practical matter, contracting officers routinely achieve such 
impressive discounts that award at published FSS prices is discouraged. 
Similarly, existing DFARS regulations provide specific guidance to DoD 
contracting officers that govern competitions under FSS.
    The final rule provides specific guidance to DoD contracting 
officers when only one offer is received. The final rule augments 
existing DoD guidance on FSS competitions. The final rule also provides 
additional guidance to DoD contracting officers that govern the 
establishment of price in one offer competitions. The final rule is 
consistent with the existing requirements for competitions under the 
FSS program and with the standard for determining fair and reasonable 
prices.
iv. Technical
    Comment: One respondent stated that the threshold of ``exceeding 
$150,000'' at DFARS 208.405-70(c)(1), which provides criteria for 
orders placed on a competitive basis, appears to create a conflict with 
DFARS 215.371(e)(ii), which creates no threshold for the ``attack 
items,'' i.e., items to facilitate against or recovery from nuclear, 
biological, chemical, or radiological attack.
    Response: The final rule supplements, but does not conflict with, 
the competition requirements in DFARS 208.405-70(c)(1). The final rule 
provides additional policies and procedures when one offer is received 
in response to a competitive solicitation. The final rule, at DFARS 
215.371-4, exempts certain acquisitions, including ``attack items'' 
from the new policies and procedures for one offer competitions.
    Comment: One respondent noted that FAR 8.404 specifically states 
that FAR part 15 is not applicable to FSS orders. Therefore, this 
statement would have to be addressed in the DFARS, in order to make 
DFARS part 215 applicable.
    Response: As requested by the respondent, the final rule adds 
specific language at DFARS 208.404(a) to make DFARS 215.371 applicable.
    Comment: One respondent recommended creating a clause for orders 
(DFARS 208.405-70(d) and 215.506(S-70)).
    Response: The final rule includes provisions at DFARS 252.215-7007, 
Notice of Intent to Resolicit, and DFARS 252.215-7008, Only One Offer, 
that apply to all competitive acquisitions, including orders, subject 
to the final rule. The final rule does not include an additional clause 
for orders.
b. Part 212
    Several respondents recommended that the proposed rule should not 
apply to commercial items (DFARS part 212), for the following reasons:
i. Timeframe for Response
    Comment: Several respondents noted that FAR 12.205(c) specifically 
provides for fewer than 30 days response time for receipt of offers for 
commercial items. One respondent stated that the proposed rule is 
inconsistent with FAR 12.205(c). Another respondent noted that 
acquisition requirements and processes for the procurement of 
commercial items were supposed to more closely resemble those 
customarily used in the commercial marketplace, which the respondent 
considers to be the reason for allowing shorter response times for 
receipt of offers for commercial items. This respondent noted that the 
DFARS proposed rule does not foster the policy behind commercial item 
acquisitions. A third respondent noted that there is an expectation 
that an agency can acquire IT in 30 days or fewer, in order to respond 
to a cyber threat. However, according to the respondent, contracting 
officers will never be able to respond in 30 days or fewer, because by 
default, an agency will post the request for quote for the required 30 
days, just to avoid the risk of having to do it over again.
    Response: Current regulations permit response times under 30 days 
for commercial items. Shorter response times may more closely resemble 
commercial practice and may speed the acquisition of critical IT and 
other items. The final rule still permits response times under 30 days, 
and only requires a resolicitation for 30 days (or a waiver) in those 
cases when only one offer was received. Market research can provide 
contracting officers the insight required to determine the solicitation 
response time required to ensure effective competition without 
needlessly lengthening every solicitation's response time to 30 days. 
In many cases, market research will indicate that multiple offers will 
be received in response to an RFP/RFQ open for fewer than 30 days. In 
other cases, market research will indicate that contracting officers 
need to give potential offerors at least 30 days to encourage effective 
competition. Similarly, market research will indicate those cases where 
additional time will likely not result in additional offers, and will 
provide contracting officers with the rationale to support a waiver of 
the resolicitation requirement. The final rule also recognizes that 
certain requirements are too urgent to permit a 30-day solicitation 
response period, and includes an exception for acquisitions in support 
of contingency, humanitarian or peacekeeping operations, or to 
facilitate defense against or recovery from nuclear, biological, 
chemical, or

[[Page 39134]]

radiological attack. Finally, the final rule also permits waivers of 
the 30-day resolicitation requirement, when necessary and justified.
ii. Other Ways To Determine Fair and Reasonable Prices
    Comment: One respondent suggested that excluding commercial 
contracts would be one means to narrow the scope of the proposed rule 
to those contracts that might return the highest level of benefit. The 
respondent noted that in the case of commercial contracts, competitive 
pricing can often be verified without resort to additional data from 
the contractor, which is one reason that the law prohibits requesting 
certified cost or pricing data for commercial contracts.
    Response: Competitive pricing can often be verified without resort 
to additional data from the contractor. The final rule has been revised 
to provide that, when a single offer is received in response to a 
competitive solicitation, the contracting officer should try to 
determine through cost or price analysis that the offered price is fair 
and reasonable and whether an exception to the requirement for 
certified cost or pricing data applies, before requesting any 
additional data from the contractor. The final rule refers contracting 
officers to the existing exceptions to the requirement to submit 
certified cost or pricing data, including the commercial item 
exception.
iii. Access to the DoD Market
    Comment: One respondent viewed the application of the proposed rule 
to acquisition of commercial items as an added barrier to entry into 
the DoD market.
    Response: Typically, commercial vendors cite the requirement for 
certified cost or pricing data as a key deterrent to doing business 
with the DoD. The final rule does not change the commercial item 
exemption to the requirement for certified cost or pricing data. In 
addition, by ensuring adequate proposal preparation time is provided to 
potential offerors, the final rule encourages commercial item vendors 
to participate in DoD's competitions. Finally, the final rule 
implements key policies necessary to improve the efficiency and 
productivity of DoD's procurements. While DoD does not believe that the 
final rule creates barriers to entry, commercial vendors will need to 
make business decisions about their participation in the DoD 
marketplace.
c. Subpart 13.5
    The FAR subpart 13.5 test program is no longer in effect. The final 
rule deletes all references to the FAR subpart 13.5 test program.
d. Part 216
    Various respondents did not agree with application of the proposed 
rule to DFARS part 216.
i. 30-Day Resolicitation
    Comment: One respondent stated that the rule should clarify whether 
the 30-day requirement also applies to delivery/task orders solicited 
under a multiple award/indefinite-delivery/indefinite-quantity type 
contract, noting that competition is limited to the primes under these 
contracts. Another respondent stated that the proposed rule should not 
require resolicitation for an additional 30 days if the other prime 
contractors indicate that they will not provide an offer if additional 
days are provided.
    Another respondent stated that the rule should not apply to 
multiple-award contracts when only two or three contractors were 
awarded the base contract, and one or more of the base contract 
awardees is excluded from submitting a proposal due to an 
organizational conflict of interest. In such case, only receiving one 
proposal will not be the result of inadequate competition and 30-day 
resolicitation would interfere with deliveries without resulting in 
increased competition.
    Response: The final rule applies to the prime contractor awardees 
in a multiple-award contract scenario. If the prime contractors state 
that they are not going to provide an offer if additional days are 
provided, or if there is an organizational conflict of interest for one 
or more of the prime contractors, then the contracting officer may 
pursue a waiver to the 30-day resolicitation requirement in accordance 
with DFARS 215.371-5 of the final rule.
ii. Adequate Price Competition
    Comment: One respondent stated that multiple-award contracts are 
already awarded based on adequate price competition.
    Response: Consistent with the fair opportunity rules at FAR 
16.505(b), the final rule is intended to promote real competition when 
only one offer is received to ensure the integrity of the competitive 
contracting process is maintained for each task or delivery order, even 
when the multiple-award contracts were awarded based on adequate price 
competition.
iii. Cost or Pricing Data
    Comment: One respondent stated that cost or pricing data was 
submitted and evaluated at time of award and does not need to be 
submitted if only one offer is received.
    Response: Even if cost or pricing data was submitted at the time of 
award, the contracting officer must consider price or cost in the 
selection decision as one of the factors for each task or delivery 
order issued. If only one offer is received for a task or delivery 
order, the contracting officer may not rely on adequate price 
competition to determine that the price of the task or delivery order 
is fair and reasonable. The contracting officer may make the 
determination that the offered price is fair and reasonable and is 
based on adequate price competition (approved one level above the 
contracting officer) or that another exception to the requirement for 
certified cost or pricing data applies. However, if the contracting 
officer cannot make this determination and must request additional cost 
or pricing data, that cost or pricing data must be certified unless an 
exception applies.
e. Part 219
    Comment: One respondent recommended that the proposed rule should 
not apply to small business set-asides. Another respondent requested 
clarification as to whether the proposed rule was intended to be 
applicable to small business programs. Although the rule did not 
specifically make any changes to FAR part 19, there may be impact 
through references in FAR 19.502-4 (Methods of conducting set-asides) 
to conducting the set-aside using the procedures of FAR parts 13, 14, 
or 15; and FAR 19.806 (Pricing the 8(a) contract) requires the 
contracting officer to price the 8(a) contract in accordance with FAR 
subpart 15.4. More specifically, the respondent pointed to FAR 19.502-
2(a), which provides that ``If the contracting officer received only 
one acceptable offer from a responsible small business concern in 
response to a set-aside, the contracting officer should make an award 
to that firm.'' There is comparable language in FAR 19.1305(c) for 
HUBZone set-asides, 19.1405(c) for service-disabled veteran-owned small 
business set-aside procedures, 19.1505(d) for women-owned small 
business program set-asides.
    Response: An exception has been added at DFARS 215.371-4(b) to the 
30-day resolicitation requirement at DFARS 215.371-2. The final rule 
does not preclude any requirement that was set-aside under the 
authority of FAR

[[Page 39135]]

19.1305, 19.1405 or 19.1505 from being awarded, if only one acceptable 
offer was received.
    The intent still is to ensure that prices and/or costs obtained by 
the offeror are fair, reasonable, and in the best interest of the 
Government, even by small businesses. Based on market research, the 
contracting officer is reasonably expected not to set-aside a 
requirement for competition, unless there is a ``reasonable expectation 
that offers will be received from two or more small business concerns 
and that award will be made at a fair market price.'' If only one 
acceptable offer is received from a competitive set-aside, then the 
procedures at DFARS 215.371-3 for determination of a fair and 
reasonable price apply equally to small business set-asides.
f. Part 235
    Comment: One respondent recommended that the final rule should 
explicitly exclude competitions for basic and applied research 
conducted under FAR 35.016. The respondent commented that, although the 
proposed rule does not address research competitions under FAR 35.016 
utilizing Broad Agency Announcements as the solicitation method, the 
amplifying memorandum of April 27, 2011, stated that the policy applies 
to all competitive procurements of supplies and services that exceed 
the simplified acquisition threshold. The respondent provided several 
reasons why the entire issue of ``one bid'' is problematic for broad 
agency announcements, because offers under broad agency announcement 
sometimes trickle in over an extended open period, and often individual 
offers can be entertained at any time.
    Response: Although the final rule does not specifically address FAR 
part 35, acquisitions under FAR part 35 are generally subject to the 
procedures of FAR part 15 and DFARS part 215. The procedures of DFARS 
215.371 should not apply to broad agency announcements under FAR 
35.006. The requirement for resolicitation if the original solicitation 
is for less than 30 days is not likely to affect a broad agency 
announcement, because they are usually issued for an extended period of 
time. However, because contracts awarded under broad agency 
announcements, although competitively awarded, are not awarded on the 
basis of price competition, the approach at DFARS 215.371 would not be 
appropriate for a broad agency announcement. Responses to a broad 
agency announcement are expected to propose varying technical/
scientific approaches. Proposals need not be evaluated against each 
other since they are not submitted in accordance with a common work 
statement. Therefore, to make it clear that DFARS 215.371 does not 
apply to awards under broad agency announcement, an exception has been 
added at DFARS 215.371-4(a)(1)(iii). DFARS 215.371-4(a)(2) states that 
the applicability of an exception does not eliminate the need for the 
contracting officer to ensure that the price is fair and reasonable.
7. Regulatory Flexibility
    Two respondents questioned the Initial Regulatory Flexibility 
Analysis (IRFA) and made recommendations for reducing the impact on 
small business.
    Comment: These respondents questioned the assertion that the rule 
will not affect small business entities. One respondent stated that 
5,148 small business awards over $150,000 is not an insubstantial 
figure. Another respondent stated that there could be adverse effects, 
especially with respect to commercial and low-dollar contracts sought 
by small businesses. According to this respondent, small businesses may 
be disproportionately impacted, because they may lack the resources to 
provide cost or pricing data. Another respondent disagreed with the 
conclusion of the IRFA that the burden for submission of cost or 
pricing data is already covered in the FAR. According to this 
respondent, the IRFA did not acknowledge that this rule will increase 
the requirement for submission of cost or pricing data by small 
businesses, because submission of cost or pricing data is not currently 
a requirement for full and open competition.
    Response: The final rule has, however, reduced the impact on all 
businesses, including small businesses. As rewritten, the final rule is 
not inconsistent with the current FAR requirements to determine that 
the price is fair and reasonable when only one offer is received. It 
uses the FAR clause 52.215-20, but includes a mechanism whereby the FAR 
clause only becomes effective if only one offer is received, and the 
contracting officer cannot determine that the offered price is fair and 
reasonable without requiring additional data. This is part of the 
current FAR requirement to determine that adequate price competition 
exists if only one offer is received.
    With regard to impact on commercial and low-dollar value contracts 
sought by small businesses, the rule does not apply at all to contracts 
with dollar values below the simplified acquisition threshold. For 
acquisitions above the simplified acquisition threshold, the 
contracting officer will only request the data necessary to determine a 
fair and reasonable price. No certified cost or pricing data is 
required for commercial items. A small business that is offering items 
to the Government in quantities that exceed the simplified acquisition 
threshold and are not commercial items should have an accounting system 
adequate to provide cost or pricing data upon request.
    Comment: Another comment on the IRFA was that it does not explain 
the relationship between the submission of cost or pricing data and 
increased competition.
    Response: As clarified in the revised policy of the final rule, 
there is no relationship between submission of cost or pricing data and 
increased competition. The submission of cost or pricing data is to 
determine whether the offered price is fair and reasonable, when the 
efforts to increase competition nevertheless resulted in only one offer 
and the contracting officer could not make that determination without 
additional data.
    Comment: One respondent further recommended exclusion of--
     Set-asides for small business; and
     Acquisitions using full and open competition procedures 
that result in single offers from small businesses.
    Response: An exception to the 30-day resolicitation requirement has 
been added at DFARS 215.371-4(b) for small business set-asides, because 
the FAR specifically provides at FAR 19.5, 19.305(c), 19.1405(c), and 
19.1505(d) that if only one acceptable offer is received under these 
set-aside programs, the contracting officer should award to that 
concern.
    The final rule does not include any exception for when the single 
offer comes from a small business, because it is important to increase 
competition and allow all businesses sufficient time to respond to a 
solicitation, which could be of benefit to other small businesses.
    In all cases, it is still essential to determine that the price is 
fair and reasonable.
8. Executive Order Requirements for Cost/Benefit Analysis
    Comment: Two respondents commented on the need for cost/benefit 
analysis as required by Executive Orders 12866 and 13563. One 
respondent recommended that DoD should consider performing a cost/
benefit analysis before finalizing the proposed rule. According to the 
respondent, the proposed rule will affect a significant number of 
procurements and may create burdens on procurement professionals and 
contractors that are not commensurate

[[Page 39136]]

with the benefits anticipated. Another respondent noted that there is a 
lack of empirical support for the proposed rule. According to the 
respondent, without further cost/benefit data to support the 
rulemaking, it fails to demonstrate that this rule is needed to cure 
the underlying problem of single offer competition.
    Response: The purpose of this rule is not just to save money but to 
ensure the integrity of the process. More competition benefits all 
parties, including small businesses. Although it is possible to 
demonstrate that increased competition strengthens the industrial base 
and has a beneficial impact on pricing, the benefits are not readily 
quantifiable. DoD is tracking improvement in the percentage of 
effective competition (more than one offer). DoD has always had a 
fiduciary responsibility to determine that prices are fair and 
reasonable. The most basic pricing policy at FAR 15.402 is that the 
contracting officer shall purchase supplies and services from 
responsible sources at fair and reasonable prices. Unless certified 
cost or pricing data is required by law (see FAR 15.403-4), the 
contracting officer is required to obtain data other than certified 
cost or pricing data as necessary to establish a fair and reasonable 
price. This rule provides a mechanism to accomplish that goal when a 
competitive solicitation does not result in more than one offer. As 
revised, the final rule does not impose unnecessary burdens. See also 
the last response in section II.B.3.a. and the responses in section 
II.B.3.b.ii.
9. Additional Recommendations
a. Delay Implementation
    Comments: One respondent recommended that DoD delay implementation 
of the rule until the Comptroller General studies one-offer contracts 
and issues a report (section 847 of the proposed Senate version of the 
National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2012 (S. 
1253) requires such a review).
    Response: The NDAA for FY 2012, as enacted, did not contain such a 
requirement for a study of one-offer contracts. DoD needs to take 
action to improve competition and ensure fair and reasonable prices. 
DoD will remain ready to reassess any future recommendations on how 
progress towards these goals can be improved.
b. Sunset Date
    Comment: One respondent recommended that the rule should sunset 
automatically 12 months after the effective date, or, at the latest, at 
any time after that if the DoD Competition Report data reveals that 
single offer competitions are 15 percent or less of the total number of 
acquisition awards.
    Response: If the policies and procedures of this rule are 
beneficial, then there is no need to sunset them after a specific 
amount of time or if certain effective competition goals are reached. 
The policies of the final rule are sound policies to maintain, 
regardless of the percentage of effective competition achieved. 
Improvement in the rate of effective competition would imply that the 
policies are working. However, if effective competition is still only 
85 percent, then the remaining 15 percent needs to be addressed, 
continuing to promote more effective competition and ensuring a fair 
and reasonable price.
c. Line Item for Cost or Pricing Data
    Comment: One respondent recommended authorization or requirement 
that contracting officers include optional contract line items to pay 
directly for the provision of cost or pricing data not required at the 
time of submission.
    Response: This cost or pricing data is requested prior to contract 
award and is still considered part of the bid or proposal costs, which 
are costs incurred in preparing, submitting, and supporting bids and 
proposals. Bid or proposal costs are only allowable as indirect 
expenses on contracts, to the extent that those costs are allocable and 
reasonable (FAR 31.205-18(c)).
d. Use of E-Proposals
    Comment: One respondent requested authorization of broader use of 
e-proposals in the solicitation and contract formation processes in 
order to offset some of the timing burden caused by a 30-day 
solicitation period and/or by late notice of the solicitation's 
requirements to prospective offerors.
    Response: E-solicitations and e-proposals are already broadly used. 
The solicitation can authorize electronic commerce methods for 
submission of offers. Some offerors prefer e-proposals, but others do 
not want e-proposals to be mandated. The goal of this rule is to 
provide sufficient time for interested offerors to respond.
e. Market Research and Price Analysis Capability
    Comment: One respondent recommended training and rewarding of 
market research capability and price analysis capability within each 
DoD component or the centralization of market research capability.
    Response: This recommendation is outside the scope of this rule.
f. Support Enhanced Communication
    Comment: One respondent recommended continued support of enhanced 
communication with industry about requirements and solutions throughout 
the acquisition cycle.
    Response: DoD wholly supports this recommendation.
10. Technical
    Comment: One respondent suggested that the coverage should be at 
DFARS subpart 215.4 rather than DFARS 215.371.
    Response: The reason for putting the coverage in DFARS 215.371 
rather than in DFARS subpart 215.4 is because the rule covers more than 
just contract pricing. It also involves seeking to increase competition 
through review of the requirements and ensuring adequate time for 
submission of offers.

III. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). E.O. 
13563 emphasizes the importance of quantifying both costs and benefits, 
of reducing costs, of harmonizing rules, and of promoting flexibility. 
This is a significant regulatory action and, therefore, was subject to 
review under section 6(b) of E.O. 12866, Regulatory Planning and 
Review, dated September 30, 1993. This rule is not a major rule under 5 
U.S.C. 804.

IV. Regulatory Flexibility Act

    A Final Regulatory Flexibility Analysis has been prepared 
consistent with the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., 
and is summarized as follows:
    This rule implements the initiative on promoting real competition 
that was presented by the Under Secretary of Defense for Acquisition, 
Technology, & Logistics in a memorandum dated November 3, 2010. The 
objective of the rule is to promote competition and ensure fair and 
reasonable prices, by implementing DoD policy with regard to 
acquisitions when only one offer is received to ensure that--
     Adequate time is allowed for receipt of offers;

[[Page 39137]]

     The requirements do not present unnecessary barriers to 
competition; and
     Cost or pricing data is obtained and negotiations are 
held, as necessary, to obtain a fair and reasonable price, when only 
one offer is received in response to a competitive solicitation and the 
contracting officer cannot determine that the offered price is fair and 
reasonable.

The legal basis is 41 U.S.C. 1303 and 48 CFR chapter 1.
    Two respondents questioned the Initial Regulatory Flexibility 
Analysis and made recommendations for reducing the impact on small 
business. See section II.B.7 for analysis of public comments on 
regulatory flexibility.
    No comments were filed by the Chief Counsel for Advocacy of the 
Small Business Administration.
    The proposed rule provided the following data: that it would affect 
all small entities that respond to a Federal solicitation for 
proposals, valued at more than $150,000, and no other offer is 
received.

                               Table--DoD Competitive Awards Valued Above $150,000
----------------------------------------------------------------------------------------------------------------
                                                                        All       Only one offer    1 Offer/SB
----------------------------------------------------------------------------------------------------------------
New Contracts or P.O............................................          54,240          14,747           3,542
New Orders under FSS............................................           4,246           1,654             818
New Orders, Non-Part 8..........................................          12,883           2,935             788
----------------------------------------------------------------------------------------------------------------

    The impact of this rule has been reduced significantly by 
eliminating the requirement for additional data and subsequent 
negotiation if the contracting officer can determine that the offered 
price is fair and reasonable and that adequate price competition exists 
(approved at one level above the contracting officer).
    The rule imposes no reporting, recordkeeping, or other information 
collection requirements. The submission of certified cost or pricing 
data or other than certified cost or pricing data is covered in FAR 
subpart 15.4 and associated clauses in FAR 52.215, OMB clearances 9000-
013.
    There are no known significant alternatives to the rule that would 
adequately implement the DoD policy. DoD considered higher thresholds 
for applicability of the rule (cost or pricing data threshold or $10 
million), but determined that higher thresholds would be detrimental to 
the effectiveness of the rule. There is no significant economic impact 
on small entities. The impact of this rule on small business is 
expected to be predominantly positive, by allowing more opportunity for 
competition.

V. Paperwork Reduction Act

    The rule does not impose any additional 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). The 
submission of certified cost or pricing data or data other than 
certified cost or pricing data required to assess whether a price is 
fair and reasonable is covered in FAR subpart 15.4 and associated 
clauses in FAR 52.215, OMB clearance number 9000-013, in the amount of 
10,101,684 hours.

List of Subjects in 48 CFR Parts 205, 208, 212, 214, 215, 216, 252

    Government procurement.

Ynette R. Shelkin,
Editor, Defense Acquisition Regulations System.

    Therefore, 48 CFR parts 205, 208, 212, 214, 215, 216, and 252 are 
amended as follows:

PART 205--PUBLICIZING CONTRACT ACTIONS

0
1. The authority citation for 48 CFR part 205 is revised to read as 
follows:

    Authority:  41 U.S.C. 1303 and 48 CFR chapter 1.

0
2. Amend section 205.203 by adding paragraph (S-70) to read as follows:

205.203  Publicizing and response time.

* * * * *
    (S-70) When using competitive procedures, if a solicitation allowed 
fewer than 30 days for receipt of offers and resulted in only one 
offer, the contracting officer shall resolicit, allowing an additional 
period of at least 30 days for receipt of offers, except as provided in 
215.371-4 and 215.371-5.

PART 208--REQUIRED SOURCES OF SUPPLIES AND SERVICES

0
3. The authority citation for 48 CFR part 208 is revised to read as 
follows:

    Authority:  41 U.S.C. 1303 and 48 CFR chapter 1.

0
4. Revise section 208.404 to read as follows:

208.404  Use of Federal Supply Schedules.

    (a)(i) In accordance with 208.405-70(c)(2), if only one offer is 
received in response to an order exceeding $150,000 that is placed on a 
competitive basis, the procedures at 215.371 apply.
    (ii) Departments and agencies shall comply with the review, 
approval, and reporting requirements established in accordance with 
subpart 217.78 when placing orders for supplies or services in amounts 
exceeding the simplified acquisition threshold.
    (iii) When a schedule lists both foreign and domestic items that 
will meet the needs of the requiring activity, the ordering office must 
apply the procedures of part 225 and FAR part 25, Foreign Acquisition. 
When purchase of an item of foreign origin is specifically required, 
the requiring activity must furnish the ordering office sufficient 
information to permit the determinations required by part 225 and FAR 
part 25 to be made.

0
5. Amend section 208.405-70 by revising paragraph (c), redesignating 
paragraph (d) as paragraph (e), and adding new paragraph (d) to read as 
follows:

208.405-70  Additional ordering procedures.

* * * * *
    (c)(1) An order exceeding $150,000 is placed on a competitive basis 
only if the contracting officer provides a fair notice of the intent to 
make the purchase, including a description of the supplies to be 
delivered or the services to be performed and the basis upon which the 
contracting officer will make the selection, to--
    (i) As many schedule contractors as practicable, consistent with 
market research appropriate to the circumstances, to reasonably ensure 
that offers will be received from at least three contractors that can 
fulfill the requirements, and the contracting officer--
    (A)(1) Receives offers from at least three contractors that can 
fulfill the requirements; or

[[Page 39138]]

    (2) Determines in writing that no additional contractors that can 
fulfill the requirements could be identified despite reasonable efforts 
to do so (documentation should clearly explain efforts made to obtain 
offers from at least three contractors); and
    (B) Ensures all offers received are fairly considered; or
    (ii) All contractors offering the required supplies or services 
under the applicable multiple award schedule, and affords all 
contractors responding to the notice a fair opportunity to submit an 
offer and have that offer fairly considered.
    (2) If only one offer is received, follow the procedures at 
215.371.
    (d) Use the provisions at 252.215-7007, Notice of Intent to 
Resolicit, and 252.215-7008, Only One Offer, as prescribed at 
215.408(3) and (4), respectively.
* * * * *

PART 212--ACQUISITION OF COMMERCIAL ITEMS

0
6. The authority citation for 48 CFR part 212 continues to read as 
follows:

    Authority:  41 U.S.C. 1303 and 48 CFR chapter 1.

0
7. Add section 212.205 to read as follows:

212.205  Offers.

    (c) When using competitive procedures, if only one offer is 
received, the contracting officer shall follow the procedures at 
215.371.

0
8. Amend section 212.301 by redesignating paragraphs (f)(iv)(F) through 
(N) as paragraphs (f)(iv)(G) through (O) and adding new paragraph 
(f)(iv)(F) to read as follows:

212.301  Solicitation provisions and contract clauses for the 
acquisition of commercial items.

    (f) * * *
    (iv) * * *
    (F) Use the provisions at 252.215-7007, Notice of Intent to 
Resolicit, and 252.215-7008, Only One Offer, as prescribed at 
215.408(3) and (4), respectively.
* * * * *

PART 214--SEALED BIDDING

0
9. The authority citation for 48 CFR part 214 is revised to read as 
follows:

    Authority:  41 U.S.C. 1303 and 48 CFR chapter 1.

0
10. Add section 214.201-6 to read as follows:

214.201-6  Solicitation provisions.

    (2) Use the provisions at 252.215-7007, Notice of Intent to 
Resolicit, and 252.215-7008, Only One Offer, as prescribed at 
215.408(3) and (4), respectively.

0
11. Add section 214.209 to read as follows:

214.209  Cancellation of invitations before opening.

    If an invitation for bids allowed fewer than 30 days for receipt of 
offers, and resulted in only one offer, the contracting officer shall 
cancel and resolicit, allowing an additional period of at least 30 days 
for receipt of offers, as provided in 215.371.

0
12. Revise section 214.404-1 to read as follows:

214.404-1  Cancellation of invitations after opening.

    (1) The contracting officer shall make the written determinations 
required by FAR 14.404-1(c) and (e)(1).
    (2) If only one offer is received, follow the procedures at 215.371 
in lieu of the procedures at FAR 14.404-1(f).

0
13. Add sections 214.408 and 214.408-1 to subpart 214.4 to read as 
follows:

214.408  Award.

214.408-1  General.

    (b) For acquisitions that exceed the simplified acquisition 
threshold, if only one offer is received, follow the procedures at 
215.371.

PART 215--CONTRACTING BY NEGOTIATION

0
14. The authority citation for 48 CFR parts 215, 216, and 252 continues 
to read as follows:

    Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.

0
15. Add sections 215.371 through 215.371-5 to subpart 215.3 to read as 
follows:

Subpart 215.3--Source Selection

Sec.
* * * * *
215.371 Only one offer.
215.371-1 Policy.
215.371-2 Promote competition.
215.371-3 Fair and reasonable price.
215.371-4 Exceptions.
215.371-5 Waiver.

215.371  Only one offer.

215.371-1  Policy.

    It is DoD policy, if only one offer is received in response to a 
competitive solicitation--
    (a) To take the required actions to promote competition (see 
215.371-2); and
    (b) To ensure that the price is fair and reasonable (see 215.371-3) 
and to comply with the statutory requirement for certified cost or 
pricing data (see FAR 15.403-4).

215.371-2  Promote competition.

    Except as provided in sections 215.371-4 and 215.371-5, if only one 
offer is received when competitive procedures were used and the 
solicitation allowed fewer than 30 days for receipt of proposals, the 
contracting officer shall--
    (a) Consult with the requiring activity as to whether the 
requirements document should be revised in order to promote more 
competition (see FAR 6.502(b) and 11.002); and
    (b) Resolicit, allowing an additional period of at least 30 days 
for receipt of proposals.

215.371-3   Fair and reasonable price.

    (a) If there was ``reasonable expectation [hellip]that two or more 
offerors, competing independently, would submit priced offers'' but 
only one offer is received, this circumstance does not constitute 
adequate price competition unless an official at one level above the 
contracting officer approves the determination that the price is 
reasonable (see FAR 15.403-1(c)(1)(ii)).
    (b) Except as provided in section 215.371-4(a), if only one offer 
is received when competitive procedures were used and the solicitation 
allowed at least 30 days for receipt of proposals (unless the 30-day 
requirement is not applicable in accordance with 215.371-4(b) or has 
been waived in accordance with section 215.371-5), the contracting 
officer shall--
    (1) Determine through cost or price analysis that the offered price 
is fair and reasonable and that adequate price competition exists (with 
approval of the determination at one level above the contracting 
officer) or another exception to the requirement for certified cost or 
pricing data applies (see FAR 15.403-1(c) and 15.403-4). In these 
circumstances, no further cost or pricing data is required; or
    (2)(i) Obtain from the offeror cost or pricing data necessary to 
determine a fair and reasonable price and comply with the requirement 
for certified cost or pricing data at FAR 15.403-4, in accordance with 
FAR provision 52.215-20. For acquisitions that exceed the cost or 
pricing data threshold, if no exception at FAR 15.403-1(c) applies, the 
cost or pricing data shall be certified; and

[[Page 39139]]

    (ii) Enter into negotiations with the offeror as necessary to 
establish a fair and reasonable price. The negotiated price should not 
exceed the offered price.

215.371-4  Exceptions.

    (a)(1) The requirements at sections 215.371-2 and 215.371-3 do not 
apply to acquisitions--
    (i) At or below the simplified acquisition threshold;
    (ii) In support of contingency, humanitarian or peacekeeping 
operations, or to facilitate defense against or recovery from nuclear, 
biological, chemical, or radiological attack; or
    (iii) Of basic or applied research or development, as specified in 
FAR 35.016(a), that use a broad agency announcement.
    (2) The applicability of an exception in paragraph (a)(1) of this 
section does not eliminate the need for the contracting officer to seek 
maximum practicable competition and to ensure that the price is fair 
and reasonable.
    (b)(1) The requirements at section 215.371-2 do not apply to small 
business set-asides under FAR subpart 19.5 or set-asides under the 
HUBZone Program (see FAR 19.1305(c)), the Service-Disabled Veteran-
Owned Small Business Procurement Program (see FAR 19.1405(c)), or the 
Woman-Owned Small Business Program (see FAR 19.1505(d)).
    (2) The requirements at section 215.371-3 do apply to such set-
asides.

215.371-5  Waiver.

    (a) The head of the contracting activity is authorized to waive the 
requirement at 215.371-2 to resolicit for an additional period of at 
least 30 days.
    (b) This waiver authority cannot be delegated below one level above 
the contracting officer.

0
16. The 215.403 section heading is revised to read as follows:

215.403  Obtaining certified cost or pricing data.

0
17. Section 215.403-1 is amended by revising paragraph (c)(1) to read 
as follows:
* * * * *
    (c) Standards for exceptions from certified cost or pricing data 
requirements--(1) Adequate price competition.
    (A) For acquisitions under dual or multiple source programs--
    (1) The determination of adequate price competition must be made on 
a case-by-case basis. Even when adequate price competition exists, in 
certain cases it may be appropriate to obtain additional information to 
assist in price analysis.
    (2) Adequate price competition normally exists when--
    (i) Prices are solicited across a full range of step quantities, 
normally including a 0-100 percent split, from at least two offerors 
that are individually capable of producing the full quantity; and
    (ii) The reasonableness of all prices awarded is clearly 
established on the basis of price analysis (see FAR 15.404-1(b)).
    (B) If only one offer is received in response to a competitive 
solicitation, see 215.371-3.
* * * * *

0
18. Amend section 215.408 by adding paragraphs (3) and (4) to read as 
follows:

215.408  Solicitation provisions and contract clauses.

* * * * *
    (3) Use the provision at 252.215-7007, Notice of Intent to 
Resolicit, in competitive solicitations that will be solicited for 
fewer than 30 days, unless an exception at 215.371-4 applies or the 
requirement is waived in accordance with 215.371-5.
    (4)(i) Use the provision at 252.215-7008, Only One Offer, in 
competitive solicitations, unless an exception at 215.371-4(a)(1) 
applies.
    (ii) In solicitations that include 252.215-7008, Only One Offer, 
also include the provision at FAR 52.215-20, Requirements for Certified 
Cost or Pricing Data and Data Other Than Certified Cost or Pricing 
Data, with any appropriate alternate as prescribed at FAR 15.408-1, but 
that provision will only take effect as specified in 252.215-7008.

PART 216--TYPES OF CONTRACTS

0
19. Amend section 216.505-70 by revising paragraph (d) to read as 
follows:

216.505-70  Orders under multiple award contracts.

* * * * *
    (d) When using the procedures in this subsection--
    (1) The contracting officer should keep contractor submission 
requirements to a minimum;
    (2) The contracting officer may use streamlined procedures, 
including oral presentations;
    (3) If only one offer is received, the contracting officer shall 
follow the procedures at 215.371.
    (4) The competition requirements in FAR part 6 and the policies in 
FAR subpart 15.3 do not apply to the ordering process, but the 
contracting officer shall consider price or cost under each order as 
one of the factors in the selection decision; and
    (5) The contracting officer should consider past performance on 
earlier orders under the contract, including quality, timeliness, and 
cost control.

0
20. Amend section 216.506 by adding paragraph (S-70) to read as 
follows:

216.506  Solicitation provisions and contract clauses.

* * * * *
    (S-70) Use the provisions at 252.215-7007, Notice of Intent to 
Resolicit, and 252.215-7008, Only One Offer, as prescribed at 
215.408(3) and (4), respectively.

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
21. Add sections 252.215-7007 and 252.215-7008 to read as follows:

252.215-7007  Notice of Intent to Resolicit.

    As prescribed at 215.408(3), use the following provision:

NOTICE OF INTENT TO RESOLICIT (JUN 2012)

    This solicitation provides offerors fewer than 30 days to submit 
proposals. In the event that only one offer is received in response 
to this solicitation, the Contracting Officer may cancel the 
solicitation and resolicit for an additional period of at least 30 
days in accordance with 215.371-2.

(End of provision)

252.215-7008  Only One Offer.

    As prescribed at 215.408(4), use the following provision:

ONLY ONE OFFER (JUN 2012)

    (a) The provision at FAR 52.215-20, Requirements for Certified 
Cost or Pricing Data and Data other Than Certified Cost or Pricing 
Data, with any alternate included in this solicitation, does not 
take effect unless the Contracting Officer notifies the offeror 
that--
    (1) Only one offer was received; and
    (2) Additional cost or pricing data is required in order to 
determine whether the price is fair and reasonable or to comply with 
the statutory requirement for certified cost or pricing data (10 
U.S.C. 2306a and FAR 15.403-3).
    (b) Upon such notification, the offeror agrees, by submission of 
its offer, to provide any data requested by the Contracting Officer 
in accordance with FAR 52.215-20.
    (c) If negotiations are conducted, the negotiated price should 
not exceed the offered price.

(End of provision)
[FR Doc. 2012-15569 Filed 6-28-12; 8:45 am]
BILLING CODE 5001-06-P
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