Federal Register / Vol. 74, No. 77 / Thursday, April 23, 2009 / Proposed Rules 18491 

OFFICE OF MANAGEMENT AND 

BUDGET 

Office of Federal Procurement Policy 

48 CFR Part 9903 

Cost Accounting Standards: 

Exemption From Cost Accounting 

Standards for Contracts Executed and 

Performed Entirely Outside the United 

States, Its Territories, and Possessions 

AGENCY: Office of Management and 

Budget (OMB), Office of Federal 

Procurement Policy. 

ACTION: Notice of request for 

information. 

SUMMARY: The Office of Federal 

Procurement Policy (OFPP), Cost 

Accounting Standards (CAS) Board 

(CASB), invites public comments and 

information on a provision that provides 

an exemption from CAS for contracts 

and subcontracts that are executed and 

performed entirely outside the United 

States, its territories, and possessions 

(overseas exemption). 

DATES: Responses must be in writing 

and must be received by May 26, 2009. 

ADDRESSES: Due to delays in OMB’s 

receipt and processing of mail, 

respondents are strongly encouraged to 

submit their responses electronically to 

ensure timely receipt. Submit your 

responses, identified by: CAS 2009 

Overseas Exemption, by one of the 

following methods: 

—Federal eRulemaking Portal: http:// 

www.regulations.gov. Simply type 

‘‘CAS 2009 Overseas Exemption’’ 

(without the quotes) in the Comment 

or Submission search box, click Go, 

and follow the online instructions for 

submitting responses. 

—E-mail: Electronic responses may also 

be submitted to casb2@omb.eop.gov. 

Be sure to include your identifying 

information: Your name, title, 

organization, and reference case ‘‘CAS 

2009 Overseas Exemption.’’ 

—Facsimile: Responses may also be 

submitted via facsimile to 202–395– 

5105. Be sure to include your 

identifying information. 

—Mail: If you must submit your 

responses via regular mail, please 

mail them to: Office of Federal 

Procurement Policy, 725 17th Street, 

NW., Room 9013, Washington, DC 

20503, ATTN: Raymond J. M. Wong. 

Be sure to include your identifying 

information. Be aware that due to the 

screening of U.S. mail to this office, 

there will be several weeks’ delay in 

the receipt of mail. Respondents are 

strongly encouraged to submit 

responses electronically to ensure 

timely receipt. 

Please note that all public responses 

received will be posted in their entirety, 

including any personal and/or business 

confidential information provided, after 

the close of the public comment period 

at http://www.whitehouse.gov/omb/ 

procurement_index_casb/ and http:// 

www.regulations.gov. 

FOR FURTHER INFORMATION CONTACT: 

Raymond J. M. Wong, Director, Cost 

Accounting Standards Board (telephone: 

202–395–6805). 

SUPPLEMENTARY INFORMATION: 

A. Regulatory Process 

Rules, Regulations and Standards 

issued by the Cost Accounting 

Standards Board (Board, CAS Board, or 

CASB) are codified at 48 CFR Chapter 

99. The OFPP Act, at 41 U.S.C. 422(g), 

requires that the Board, prior to the 

establishment of any new or revised 

Cost Accounting Standards (CAS or 

Standards), complete a prescribed 

rulemaking process. The process 

generally consists of the following four 

steps: 

1. Consult with interested persons 

concerning the advantages, 

disadvantages and improvements 

anticipated in the pricing and 

administration of Government contracts 

as a result of the adoption of a proposed 

Standard (e.g., promulgation of a Staff 

Discussion Paper (SDP)). 

2. Promulgate an Advance Notice of 

Proposed Rulemaking (ANPRM). 

3. Promulgate a Notice of Proposed 

Rulemaking (NPRM). 

4. Promulgate a Final Rule. 

The CASB notes that the overseas 

exemption at 48 CFR 9903.201–1(b)(14) 

is not subject to the four-step process 

required by 41 U.S.C. 422(g)(1) because 

it is not a cost accounting standard. 

Thus, there is no requirement for the 

CASB to follow the four-step process for 

this promulgation. The CASB is 

soliciting public responses, comments 

and information in a process that may 

lead to a change in the CAS regulations 

with respect to the overseas exemption. 

B. Background and Summary 

The Office of Federal Procurement 

Policy (OFPP), Cost Accounting 

Standards Board, is today publishing a 

request for information with respect to 

the exemption from CAS at 48 CFR 

9903.201–1(b)(14). That exemption (the 

overseas exemption) provides that 

‘‘contracts and subcontracts to be 

executed and performed entirely outside 

the United States, its territories, and 

possessions’’ are exempt from all CAS 

requirements. The OFPP Act, at 41 

U.S.C. 422(g)(1), requires the Board to 

consult with interested persons 

concerning the advantages, 

disadvantages, and improvements 

anticipated in the pricing and 

administration of Government contracts 

as a result of the adoption of a proposed 

rule prior to the promulgation of any 

new or revised CAS or rule. 

Section 823 of the Duncan Hunter 

National Defense Authorization Act for 

Fiscal Year 2009 requires the CASB to: 

(1) Review the applicability of CAS to 

contracts and subcontracts which would 

be subject to CAS, but for the fact that 

they are executed and performed 

entirely outside the United States, and 

(2) determine whether the Government 

would benefit from the application of 

CAS to such contracts and subcontracts. 

A report is due to Congress 270 days (by 

mid-July 2009) after the date of 

enactment (October 14, 2008) explaining 

what, if anything, will be done to revise 

the overseas exemption. 

The purpose of this request for 

information is to solicit public 

comments and information with respect 

to the CASB’s review of whether the 

overseas exemption from CAS at 48 CFR 

9903.201–1(b)(14) should be retained, 

eliminated, or revised, and if revised, 

how should it be revised. ‘‘Contracts 

and subcontracts to be executed and 

performed entirely outside the United 

States * * *’’ can be executed and 

performed by a variety of entities with 

different legal statuses including, but 

not limited to: A U.S. concern, a foreign 

concern authorized to do business in the 

United States, a foreign concern (not 

authorized to do business in the United 

States) which is a related party to a U.S. 

concern, and foreign concerns with 

various other attributes that could affect 

their legal status. The focus of this 

request for information is with respect 

to contracts that would otherwise be 

subject to CAS, but for the fact that the 

contract is exempted because it is 

executed and performed entirely 

overseas. Thus, the affected contractors 

are likely to be U.S. concerns and other 

concerns authorized to do business in 

the United States. 

Respondents are encouraged to 

identify, comment and provide 

information on any issues that they 

believe are important to the subject. 

C. Public Comments 

Interested persons are invited to 

participate by providing their input, 

data, views or arguments with respect to 

this request for information, including, 

but not limited to, the questions listed 

in the request for information. All 

responses must be in writing, and 


rwilkins on PROD1PC63 with PROPOSALS
18492 Federal Register / Vol. 74, No. 77 / Thursday, April 23, 2009 / Proposed Rules 

submitted as instructed in the 

ADDRESSES section. 

Lesley A. Field, 

Acting Chair, Cost Accounting Standards 

Board. 

Cost Accounting Standards Board 

Request for Information 

48 CFR 9903.201–1(b)(14) 

Exemption From Cost Accounting 

Standards for Contracts Executed and 

Performed Entirely Outside the United 

States 

Background 

Purpose 

48 CFR 9903.201–1(b) is a list of 

categories of contracts and subcontracts 

that are exempt from CAS requirements 

(CAS exemptions). Paragraph (14) of 

this provision provides an exemption 

for ‘‘[c]ontracts and subcontracts to be 

executed and performed entirely outside 

the United States, its territories, and 

possessions’’ (overseas exemption). The 

purpose of this request for information 

is to explore whether this CAS 

exemption should be retained, 

eliminated or revised. 

The History of the Exemption 

The original CAS Board (CASB) was 

established by Section 2168 of the 

Defense Production Act of 1950 (DPA). 

Section 2163, ‘‘Territorial application of 

Act,’’ of the DPA provided that Sections 

2061 through 2171 (which includes the 

authority for the CASB) ‘‘shall be 

applicable to the United States, its 

Territories and possessions, and the 

District of Columbia’’ (United States). 

Since the applicable DPA provisions 

were applicable only within the United 

States as defined, the CASB’s rules, 

regulations and CAS were only 

applicable within the United States, as 

specifically defined, and thus, they were 

not applicable overseas. 

On September 24, 1973, Defense 

Procurement Circular No. 115 amended 

ASPR (Armed Services Procurement 

Regulation) 3–1204 to provide for this 

CAS exemption in contracts as follows: 

3–1204 Contract Clause. The Cost 

Accounting Standards clause set forth in 

7–104.83 shall be inserted in all 

negotiated contracts exceeding 

$100,000, except when the price is 

based on established catalog or market 

prices of commercial items sold in 

substantial quantities to the general 

public or is set by law or regulation. In 

addition to the foregoing exceptions, the 

clause shall not be inserted in the 

following contacts: 

* * * * * 

(vi) contracts which are executed and 

performed in their entirety outside the 

United States, its territories and 

possessions [(overseas exemption)]. 

Additional historical background is 

provided in the SDP published at 70 FR 

53977 (September 13, 2005) which 

previously invited public comments on 

whether the overseas exemption should 

be revised or eliminated. 

In 1980, the CASB ceased to exist 

under the DPA. In the absence of the 

CASB, the Department of Defense (DOD) 

took over the responsibility for the 

administration of CAS. DOD 

administered CAS until the CASB was 

re-established in 1988 under the 

authority of the OFPP Act. 

In 1991, the re-established CASB 

reviewed the rules and regulations 

applicable to the administration of CAS. 

FAR 30.201–1(14), the exemption from 

CAS for contracts and subcontracts 

executed and performed entirely outside 

the United States, its territories and 

possessions, was part of that review. 

The re-established CASB retained the 

overseas exemption and incorporated it 

into its current recodified rules and 

regulations at 48 CFR 9903.201–1 on 

April 17, 1992 (57 FR 14148.) 

More recently, in response to the 2005 

SDP regarding the overseas exemption, 

the CASB received three public 

comments in response. All the 

comments offered arguments for why 

the CASB should retain the exemption; 

none of the comments supported any 

revision to, or an elimination of, the 

overseas exemption. After reviewing 

and discussing the comments to the 

SDP, the CASB discontinued its review 

of the overseas exemption. (73 FR 8259, 

February 13, 2008.) While the CASB did 

not agree with all of the views 

expressed, it did agree with the 

conclusion not to delete or revise the 

overseas exemption. 

Questions for Consideration 

The CASB is soliciting information 

and comments on the overseas 

exemption from interested parties. In 

framing your responses, be aware that 

contracts and subcontracts that are 

executed and performed entirely outside 

of the United States can be executed and 

performed by entities with a variety of 

legal statuses. The focus of this request 

for information is with respect to 

contracts that would be otherwise 

subject to CAS, but for the exemption 

because the contract is executed and 

performed entirely overseas. Thus, the 

class of affected contractors is likely to 

be U.S. concerns and other concerns 

authorized to do business in the United 

States. 

More specifically, the CASB is 

particularly interested in information 

and comments related to the following 

questions: 

1. What is your experience with the 

overseas exemption: 

a. As a procuring entity (e.g., 

procurement office, higher tier 

contractor) awarding contracts/ 

subcontracts; or 

b. As the contractor/subcontractor 

claiming the applicability of the 

overseas exemption? 

2. How often (number of actions, 

dollar amounts, by fiscal year) has the 

overseas exemption been claimed? 

3. If the overseas exemption is 

eliminated, what problems will that 

cause you: 

a. As a procuring entity (e.g., 

procurement office, higher tier 

contractor) awarding contracts/ 

subcontracts; or 

b. As the contractor/subcontractor 

claiming the applicability of the 

overseas exemption? 

4. How does the overseas exemption 

help, or not help, to implement the 

CASB’s mandate ‘‘to achieve uniformity 

and consistency in the cost accounting 

standards governing measurement, 

assignment, and allocation of costs to 

contracts with the United States’’? 

5. What are the arguments for, and 

against, the requirement in the overseas 

exemption to require execution of the 

contract overseas? 

6. What are the arguments for, and 

against, the requirement in the overseas 

exemption to require performance of the 

contract overseas? 

[FR Doc. E9–9359 Filed 4–22–09; 8:45 am] 

BILLING CODE 3110–01–P 

DEPARTMENT OF COMMERCE 

National Oceanic and Atmospheric 

Administration 

50 CFR Part 217 

[Docket No. 090206146–9332–01] 

RIN 0648–AX32 

Taking and Importing Marine 

Mammals; Taking Marine Mammals 

Incidental to the Port of Anchorage 

Marine Terminal Redevelopment 

Project 

AGENCY: National Marine Fisheries 

Service (NMFS), National Oceanic and 

Atmospheric Administration (NOAA), 

Commerce. 

ACTION: Proposed rule; request for 

comments. 

SUMMARY: NMFS has received an 

application from the Port of Anchorage 


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