`[Federal Register Volume 90, Number 2 (Friday, January 3, 2025)]
[Rules and Regulations]
[Pages 507-517]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-31403]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 2, 3, 9, 22, 25, 26, 33, and 52

[FAC 2025-03; FAR Case 2019-015, Item I; Docket No. FAR-2019-0015; 
Sequence No. 1]
RIN 9000-AN98


Federal Acquisition Regulation: Improving Consistency Between 
Procurement and Nonprocurement Procedures on Suspension and Debarment

AGENCY: Department of Defense (DoD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Final rule.

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SUMMARY: DoD, GSA, and NASA are issuing a final rule amending the 
Federal Acquisition Regulation (FAR) to improve consistency between the 
procurement and nonprocurement procedures on suspension and debarment, 
based on the recommendations of the Interagency Suspension and 
Debarment Committee.

DATES: Effective January 17, 2025.

FOR FURTHER INFORMATION CONTACT: For clarification of content, contact 
Ms. Zenaida Delgado, Procurement Analyst, at 202-969-7207 or by email 
at [email protected]. For information pertaining to status or 
publication schedules contact the Regulatory Secretariat Division at 
202-501-4755 or [email protected]. Please cite FAC 2025-03, FAR Case 
2019-015.

SUPPLEMENTARY INFORMATION:

I. Background

    DoD, GSA, and NASA published a proposed rule at 89 FR 1043 on 
January 9, 2024, to improve consistency between procurement and 
nonprocurement procedures on suspension and debarment, based on the 
recommendations of the Interagency Suspension and Debarment Committee 
(ISDC). The procurement procedures on suspension and debarment are 
covered in the FAR. The nonprocurement procedures on suspension and 
debarment (i.e., Nonprocurement Common Rule (NCR)) are covered in 2 CFR 
part 180 and agency implementing regulations. For further details 
please see the proposed rule. Five respondents submitted comments on 
the proposed rule.

II. Discussion and Analysis

    The Civilian Agency Acquisition Council and the Defense Acquisition 
Regulations Council (the Councils) 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: No changes to the FAR text have 
been made from the proposed to final rule that have a significant 
negative effect on contractors. Minor changes and clarifications have 
been made to the final rule. These changes are outlined below:
    1. Revised FAR 9.406-1(a) to provide clarification regarding which 
mitigating and aggravating factors may apply to individuals.
    2. Revised FAR 9.406-3(b)(1) and 9.407-3(b)(1) to clarify that if 
the suspending and debarring official (SDO) extends the opportunity for 
the contractor to submit material in opposition, then the SDO should 
also give a deadline for submission of materials.
    3. Revised FAR 9.406-3(c)(1)(i) to allow the notice of proposed 
debarment, or the notice of suspension, to be sent by U.S. mail or 
private delivery service to the last known street address, with 
delivery notification service.
    4. Revised FAR 9.406-3(c)(1)(ii) to allow the notice of proposed 
debarment, or the notice of suspension, to be sent by email to the 
point of contact email address in the contractor's registration in the 
System for Award Management (SAM), if any, or to the last known email 
address as confirmed by the agency.
    5. Revised FAR 9.406-3(d)(1) to clarify that the official record 
closes upon the expiration of the contractor's time to submit 
information and argument in opposition, including any extensions.

B. Analysis of Public Comments

1. Outside the Scope of the Rule
    Comment: A respondent recommended adding FAR language to address 
applicability of the suspension and debarment rules to Other 
Transaction Authority (OTA) Agreements and to grants.
    Response: This comment is outside the scope of this rule. Neither 
OTA Agreements nor grants are covered in the FAR.
    Comment: A respondent recommended adding a definition of ``present 
responsibility.''
    Response: This issue was previously considered in a notice issued 
by the Office of Management and Budget (OMB) regarding guidelines for 
Nonprocurement Debarment and Suspension at 52 FR 20360 on May 29, 1987, 
and it was concluded that the definition is unnecessary. The suggestion 
has been referred to the ISDC for further consideration.
2. Immediate Exclusionary Effect of a Notice of Proposed Debarment 
Under the FAR
    Comment: A respondent stated that the term ``notice of proposed 
debarment'' under the FAR is misleading because the debarment is not 
``proposed''--it is ``imposed.'' Most of the respondents recommended 
that the immediate exclusionary effect of proposed debarment be removed 
from the FAR to align better with the NCR, and disagree with the 
Government's rationale for retaining it in the FAR. These respondents 
indicated that if the risk to the Government in a specific case 
requires immediate exclusion to protect the Government's business 
interests, an SDO can issue a notice of suspension under FAR 9.407. 
Where immediate exclusion is not necessary and the Government would not 
choose to suspend the contractor, the proposal for debarment should not 
have an exclusionary effect. Immediate exclusion is particularly 
unwarranted in cases where the proposed debarment is not based on a 
conviction or civil judgment, and fact-finding proceedings are 
necessary. These respondents indicated that there is no increased 
business risk to the Government in the procurement context than in 
nonprocurement transactions. The respondents stated that the Government 
enters into procurement contracts for public purposes of equal 
importance

[[Page 508]]

and comparative risk as some nonprocurement transactions. The 
respondents also pointed out that the Appropriations Act language cited 
in the proposed rule does not require an SDO to issue an exclusionary 
notice as part of the assessment of whether suspension and debarment is 
appropriate. The respondents stated that those statutes simply require 
the official to have considered whether exclusion is necessary to 
protect the Government, which can be done without an immediate 
exclusion (e.g., with a pre-notice letter or proactive outreach by the 
contractor).
    Response: DoD, GSA, and NASA acknowledge the comments but continue 
to think, after deliberation with the ISDC, that the policy reasons 
articulated in the preamble to the proposed rule for giving different 
effect to a proposed debarment when applied to a procurement contract 
versus a grant remain valid. These policy reasons are based on 
differences in the purpose of procurement contracts and grants, as well 
as occasional differences in comparative risk between these 
instruments. Equally important, neither the ISDC nor the Federal 
Acquisition Regulatory Council think that the application of a proposed 
debarment, long allowed by the FAR to protect the taxpayer from harm, 
leads to inappropriate use or overuse of immediate exclusions. In 
addition, the final FAR rule formally recognizes the use of pre-notice 
letters for the suspending and debarring official to consider as an 
alternative to an immediate exclusion. For these reasons, no changes 
have been made regarding the immediate exclusionary effect of a notice 
of proposed debarment.
3. Methods of Communication
    Comment: A respondent expressed support for the amendments to FAR 
9.406-3(b)(1) and 9.407-3(b)(1) to permit contractors and their 
representatives to present matters in opposition remotely. However, the 
respondent is concerned that permitting notices of proposed debarment, 
suspension, and the SDO decisions to be sent by standard U.S. mail 
(with no return receipt requested) or by email ``[t]o the last known 
email address'' may be inadequate to give contractors notice and an 
opportunity to respond. The respondent recommended aligning this 
provision with the NCR to require that any notice sent by U.S. mail be 
sent by certified mail or its equivalent to increase the likelihood 
that the notice will actually be received. The respondent pointed out 
that this recommendation is consistent with notions of due process and 
fundamental fairness. It is also consistent with the purpose of the 
proposed rule: to better align the FAR and NCR.
    Response: DoD, GSA, and NASA recognize the need for broad agency 
flexibility due to the variety of agency missions. FAR 9.406-3(c)(1)(i) 
was revised to allow the written notice to be sent by U.S. mail or 
private delivery service to the last known street address, with 
delivery notification service. FAR 9.406-3(c)(1)(ii) was revised to 
allow the written notice to be sent by email to the point of contact 
email address in the contractor's SAM registration, if any, or to the 
last known email address as confirmed by the agency. These changes 
provide agencies additional tools beyond using U.S. certified mail with 
return receipt requested, and they are consistent with the flexibility 
provided by the NCR, see 2 CFR 180.975 and 180.615.
    Comment: Regarding sending notices by email, a respondent 
recommended clarifying how SDOs will determine the ``last known email 
address'' for a contractor, its identified counsel, or agent for 
service of process. The respondent further recommended defining the 
contractor's ``last known email address'' as the point of contact email 
address in the contractor's SAM registration. Additionally, the 
respondent recommended requiring SDOs to take additional steps to 
confirm the contractor's receipt of notices sent by email, such as 
requiring a response to confirm receipt, requesting a ``read receipt'' 
on the email, or following up by telephone to confirm that the email 
was received.
    Response: The changes to FAR 9.406-3(c)(1)(i) and (ii) allow 
agencies the flexibility to rely on a variety of verification services 
and resources to confirm the last known street address or the last 
known email address. Requiring specific delivery confirmation practices 
is overly prescriptive.
    Comment: A respondent recommended amending FAR 9.406-4 to add 
``demonstration of non-receipt of notice'' as a reason for the SDO to 
reduce the period or extent of debarment. Another respondent 
recommended providing for immediate reinstatement of contractors 
debarred without receiving notice of a proposed debarment. The SDO 
could then reissue the notice of proposed debarment and provide the 
contractor an opportunity to respond before determining whether to 
continue the debarment for the remainder of the period of debarment. If 
the SDO determines that debarment is warranted, the contractor would be 
debarred only for the amount of time remaining in the original period 
of debarment prior to reinstatement. If the SDO determines that 
debarment was not warranted, all records of the prior exclusion should 
be removed from SAM.gov and other applicable Government databases. And, 
if the SDO determines that an administrative agreement is appropriate, 
information in relevant Government databases should be amended to 
reflect that the contractor was proposed for debarment and an 
administrative agreement was executed but should not reflect that 
debarment was ever imposed.
    Response: The FAR and the NCR describe how agencies achieve proper 
notice such that notice is considered to have been received by the 
contractor. The language in the preamble to the proposed rule (89 FR 
1045) regarding nonreceipt of notice was not intended to create 
procedures for immediate reinstatement, but rather to provide an 
example of a reason under FAR 9.406-4(c)(5) that a debarring official 
may deem appropriate to reduce the period or extent of debarment. As 
FAR 9.406-4(c)(5) is a catch-all provision, the suggestion to add 
``demonstration of non-receipt of notice'' is not adopted.
    Comment: A respondent commended the decision to require that 
notices of proposed debarment be sent directly to the contractor, the 
contractor's identified counsel for purposes of the administrative 
proceedings, or the contractor's agent for service of process, rather 
than permitting notices to be sent to partners, officers, directors, 
owners, or joint venturers. The respondent also commended retaining the 
requirement that notices be sent directly to specifically named 
affiliates (and adding that such notices may be sent to the affiliate's 
identified counsel for purposes of the administrative proceedings, or 
the affiliate's agent for service of process). Requiring that notices 
be sent directly to the party named in the notice promotes due process 
by helping ensure that notices are actually received and that the 
cognizant party has an opportunity to respond.
    Response: DoD, GSA, and NASA acknowledge the respondent's support 
for the rule.
4. Administrative Agreement
    Comment: A respondent recommended that the final rule clarify that 
``potential suspension proceeding'' and ``potential debarment 
proceedings'' are those suspension or debarment proceedings initiated 
by, at a minimum, a pre-notice letter or other formal action and 
further clarify that an administrative agreement resulting from

[[Page 509]]

a contractor's proactive outreach, as opposed to resulting from a 
``potential proceeding,'' need not be publicly posted to the Federal 
Awardee Performance and Integrity Information System (FAPIIS).
    Response: The statute (41 U.S.C. 2313) applies to any 
administrative agreement, making no exceptions for how the agreement 
came about. The applicable requirement mandates FAPIIS include 
information regarding ``[e]ach Federal administrative agreement entered 
into by the person and the Federal Government in the period to resolve 
a suspension or debarment proceeding.'' 41 U.S.C. 2313(c)(4). An 
administrative agreement restricting the Government's ability to seek 
suspension or debarment necessarily resolves suspension and debarment 
proceedings. Any such agreement forecloses the opportunity to pursue 
those remedies on the facts of the existing administrative agreement.
5. Administrative Record
    Comment: A respondent recommended including language in the final 
rule that requires all agencies to (i) provide as part of the notice 
initiating a proposed debarment or suspension, or with a pre-notice 
letter, a copy of the relevant administrative record or other compiled 
information, in the case of a pre-notice letter, and (ii) distribute, 
upon receipt of a request from a contractor for the administrative 
record or information supporting a pre-notice letter, a copy of the 
administrative record or compiled information to the contractor within 
five days of receipt of the written request. These recommended changes 
promote a decision-making process that is ``as informal as is 
practicable, consistent with principles of fundamental fairness,'' see 
FAR 9.406-3(b), and serve to standardize practices across all Federal 
SDO activities. The respondent recognized this recommendation falls 
outside the stated objective of improving the ``consistency between the 
procurement and nonprocurement procedures on suspension and 
debarment.'' Nonetheless, the respondent encouraged consideration of 
this change to promote consistent standards of fundamental fairness. 
The respondent added that in an appropriate rulemaking, a similar 
change could be made to the NCR to achieve alignment.
    Response: DoD, GSA, and NASA acknowledge the suggestion and decline 
to adopt it. This matter appropriately remains one of agency 
discretion.
    Comment: A respondent recommended adding a definition of 
``Administrative Record'' (or ``Official Record'') to the FAR.
    Response: The administrative record is the information the SDO has 
at the time that official makes a decision regarding a suspension or 
debarment proceeding. See FAR 9.406-3(d) and 9.407-3(d). In the context 
provided by the FAR, a formal definition is not necessary.
    Comment: Under the NCR, SDOs are required to include in the 
administrative record for proposed debarments and suspensions ``[a]ny 
further information and argument presented in support of, or opposition 
to, the [action].'' See 2 CFR 180.750(a)(2) and 180.845(b)(2). The 
respondent recommended that the FAR require a copy of all supplemental 
materials not provided by the contractor be distributed to the 
contractor within five days of the SDO's decision to include the 
materials in the administrative record. This change promotes consistent 
standards across agencies as well as fundamental fairness.
    Response: DoD, GSA, and NASA acknowledge the suggestion and decline 
to adopt it. Rather than representing what to include in the 
administrative record for proposed debarments and suspensions, 2 CFR 
180.750(a)(2) and 180.845(b)(2) represent what to include in the 
administrative record after the SDO suspends or proposes the contractor 
for debarment. The administrative record is typically given to a 
contractor after a decision has been made; however, in the time between 
notices agencies have the discretion to provide documents to the 
contractor upon request. This flexibility is commensurate with FAR 
9.406-3(b)(1).
    Comment: A respondent expressed support for the FAR revision to 
require that an SDO make a debarment decision within 45 days after the 
``the official administrative record is closed.'' 89 FR 1049. Given the 
significance of closing the ``official administrative record,'' the 
respondent recommended also requiring that the contractor be notified 
of the date when the official administrative record is to close. This 
revision promotes transparency and orderly process in the debarment 
proceedings, allows the contractor to add any additional information to 
the record before its closure, and allows the contractor to assert 
procedural rights relating to the timing of the debarment decision. The 
recommended change would also ensure that the agency and the contractor 
are on the same footing for purposes of measuring the time given for 
the SDO's decision making. The respondent asserts that this change 
would also promote consistent standards across agencies and is 
consistent with notions of fundamental fairness.
    Response: DOD, GSA, and NASA recognize the importance of 
transparency in the Government's suspension and debarment procedures. 
The Councils considered the respondent's suggestion and made edits at 
FAR 9.406-3(d)(1) to clarify that the official record closes upon the 
expiration of the contractor's time to submit information and argument 
in opposition, including any extensions. If a contractor is unsure 
whether the administrative record has been closed, they should ask the 
SDO to clarify.
6. Mitigating and Aggravating Factors That Could Apply to an Individual 
Person Proposed for Exclusion
    Comment: A respondent stated that even with the proposed inclusion 
of additional aggravating or mitigating factors from the NCR in the 
FAR, under both the FAR and the NCR, the factors that an SDO considers 
when evaluating whether exclusion is necessary apply most directly to 
organizations, not people. The respondent stated that this gap is 
significant given that the majority of suspension and debarment actions 
appear to be brought against individuals, as opposed to organizations. 
Moreover, unlike an organization, an individual proposed for exclusion 
may not be able to afford counsel to represent him or her in a 
suspension or debarment proceeding. As these factors are currently 
drafted, and without the means to secure experienced counsel, an 
individual may not even realize that the mitigating and aggravating 
factors are a consideration that could apply in the situation of an 
individual facing potential exclusion. Fundamental fairness, 
transparency, informality, and due process counsel in favor of 
developing factors that the average person can understand. The 
respondent provided examples of potential factors that could apply to 
an individual person proposed for exclusion. The respondent recognized 
that this suggestion extends beyond mere alignment of the FAR with the 
NCR but encouraged consideration of adding these additional factors to 
promote fundamental fairness in the treatment of individuals proposed 
for suspension or debarment.
    Response: DOD, GSA, and NASA have considered the recommendation to 
include mitigating and aggravating factors for individuals. As set 
forth in FAR 9.406-1(a), such factors apply to a ``contractor.'' 
Pursuant to FAR 9.403, the definition of ``contractor''

[[Page 510]]

specifically includes both individuals and other legal entities. The 
Councils recognize that clarifying the mitigating and aggravating 
factors that are applicable to individuals may increase transparency. 
Consequently, FAR 9.406-1(a) is modified to provide clarification 
regarding which factors may apply to individuals. Other mitigating or 
aggravating factors proposed by the respondent are more suitably 
considered at the SDO's discretion under the catch-all factor at FAR 
9.406-1(a)(17).

C. Other Changes

    The term ``sanctions'' is replaced with ``remedies'' at FAR 
9.402(b) for consistency with the FAR language in part 9. Language was 
added at FAR 9.406-3(f)(1) and 9.407-3(e)(1) for parallel construction 
with FAR 9.406-3(f)(2) and 9.407-3(e)(2), respectively. Minor edits 
were made to the final rule to update text for current FAR drafting 
conventions and to improve readability.

III. Applicability to Contracts at or Below the Simplified Acquisition 
Threshold (SAT) and for Commercial Products (Including Commercially 
Available Off-the-Shelf (COTS) Items) or for Commercial Services

    This rule does not create new solicitation provisions or contract 
clauses, nor does it change the applicability or burden of any existing 
provisions or clauses included in solicitations and contracts valued at 
or below the SAT, or for commercial products, including COTS items, or 
for commercial services.

IV. Expected Impact of the Rule

    This rule improves consistency between the procurement and 
nonprocurement procedures on suspension and debarment. These changes in 
the FAR bring the two systems into closer alignment, which will enhance 
transparency and consistency within the Government's suspension and 
debarment procedures. This will allow contractors a better 
understanding of how the two systems' procedures relate to each other.

V. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 12866 (as amended by E.O. 14094) and 13563 
direct agencies to assess the costs and benefits of available 
regulatory alternatives and, if regulation is necessary, to select 
regulatory approaches that maximize net benefits (including potential 
economic, environmental, public health and safety effects, distributive 
impacts, and equity). E.O. 13563 emphasizes the importance of 
quantifying both costs and benefits, of reducing costs, of harmonizing 
rules, and of promoting flexibility. This is not a significant 
regulatory action and, therefore, was not subject to review under 
section 6(b) of E.O. 12866, Regulatory Planning and Review, dated 
September 30, 1993.

VI. Congressional Review Act

    Pursuant to the Congressional Review Act, DoD, GSA, and NASA will 
send this rule to each House of the Congress and to the Comptroller 
General of the United States. The Office of Information and Regulatory 
Affairs (OIRA) in the Office of Management and Budget has determined 
that this rule does not meet the definition in 5 U.S.C. 804(2).

VII. Regulatory Flexibility Act

    DoD, GSA, and NASA have prepared a Final Regulatory Flexibility 
Analysis (FRFA) consistent with the Regulatory Flexibility Act, 5 
U.S.C. 601-612.

    1. Statement of the need for, and the objectives of, the rule.
    DoD, GSA, and NASA are amending the FAR to improve consistency 
between the procurement and nonprocurement procedures on suspension 
and debarment, based on recommendations of the Interagency 
Suspension and Debarment Committee.
    The objective of this rule is to change the FAR so that the two 
systems of procurement and nonprocurement suspension and debarment 
will be in closer alignment where appropriate, to enhance 
transparency and consistency within the FAR system.
    2. Statement of the significant issues raised by the public 
comments in response to the initial regulatory flexibility analysis, 
a statement of the assessment of the agency of such issues, and a 
statement of any changes made to the rules as a result of such 
comments.
    There were no significant issues raised by the public comments 
in response to the initial regulatory flexibility analysis.
    3. Description of and an estimate of the number of small 
entities to which the rule will apply.
    The final rule applies to all entities that do business with the 
Federal Government.
    The exclusions section of SAM does not contain data on the size 
of an excluded party as size is only specifically determined 
contract by contract based on the North American Industry 
Classification System (NAICS) code. When the entity is recorded in 
SAM as an excluded party, the SDO identifies the entity as either 
(1) an individual, (2) firm, (3) vessel, or (4) special entity 
designation. Collection of unique identification numbers are on 
``firms'' and optionally on ``special entity designations''.
    Data was analyzed by obtaining the list of entities that were 
excluded in fiscal years 2021, 2022, and 2023. Next, the entities on 
that list were compared with unique identification numbers against 
the SAM data to see if any were actively registered in those fiscal 
years for all awards. Lastly, the entities that would be considered 
small businesses were identified based on their primary NAICS code.
    The following is a breakdown of those distinct entities, which 
had an entity registration in active status and concurrent active 
exclusion record per fiscal year (FY):

----------------------------------------------------------------------------------------------------------------
                                        FY 2021             FY 2022             FY 2023             Median
 Suspension and debarment-  SAM  -------------------------------------------------------------------------------
           exclusions                  SB/total            SB/total            SB/total
                                      exclusions          exclusions          exclusions          SB percent
----------------------------------------------------------------------------------------------------------------
Small Business/Total Exclusions.  273/429...........  251/417...........  241/392...........
Small Business Percentage.......  64 percent........  60 percent........  61 percent........  61 percent.
----------------------------------------------------------------------------------------------------------------

    4. Description of projected reporting, recordkeeping, and other 
compliance requirements of the rule.
    The rule does not include any reporting or recordkeeping 
requirements. The rule does not contain any information collection 
requirements that require the approval of the Office of Management 
and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35) 
or other compliance requirements for small entities.
    44 U.S.C. 3518 and 5 CFR 1320.4(a)(2) give an exception for the 
collection of information during the conduct of an administrative 
action, investigation, or audit involving an agency against specific 
individuals or entities.
    5. Description of the steps the agency has taken to minimize the 
significant economic impact on small entities consistent with the 
stated objectives of applicable statutes.
    The FAR changes are not expected to have a significant economic 
impact on a substantial number of small entities. The rule imposes 
minor procedural changes in compliance requirements on contractors 
and minor process procedures for the Government. However, this 
alignment enhances transparency and consistency within the 
Government's suspension and debarment procedures, reducing the 
complexities in understanding of the two distinct processes and 
procedural requirements for suspension and debarment Governmentwide. 
It is anticipated that this rule will have a positive impact on 
small businesses with increased transparency in the process. DoD, 
GSA, and NASA were unable to identify any significant alternatives

[[Page 511]]

to accomplish the desired objective of the rule.

    Interested parties may obtain a copy of the FRFA from the 
Regulatory Secretariat Division. The Regulatory Secretariat Division 
has submitted a copy of the FRFA to the Chief Counsel for Advocacy of 
the Small Business Administration.

VIII. Paperwork Reduction Act

    This rule does not contain any information collection requirements 
that require the approval of the Office of Management and Budget under 
the Paperwork Reduction Act (44 U.S.C. 3501-3521).

List of Subjects in 48 CFR Parts 2, 3, 9, 22, 25, 26, 33, and 52

    Government procurement.

William F. Clark,
Director, Office of Government-wide Acquisition Policy, Office of 
Acquisition Policy, Office of Government-wide Policy.

    Therefore, DoD, GSA, and NASA are amending 48 CFR parts 2, 3, 9, 
22, 25, 26, 33, and 52 as set forth below:

0
1. The authority citation for 48 CFR parts 2, 3, 9, 22, 25, 26, 33, and 
52 continues to read as follows:

    Authority:  40 U.S.C. 121(c); 10 U.S.C. chapter 4 and 10 U.S.C. 
chapter 137 legacy provisions (see 10 U.S.C. 3016); and 51 U.S.C. 
20113.

PART 2--DEFINITIONS OF WORDS AND TERMS

0
2. Amend section 2.101 by--
0
a. Revising the definition of ``Conviction'';
0
b. In the definition of ``Debarment'', removing ``a debarring'' and 
``is excluded is ``debarred.'' '' and adding ``a suspending and 
debarring'' and ``is ``debarred'' is excluded.'' in their places, 
respectively;
0
c. Adding in alphabetical order the definition of ``Suspending and 
debarring official''; and
0
d. In the definition of ``Suspension'', removing ``suspending 
official'' and ``disqualified is ``suspended.'' '' and adding 
``suspending and debarring official'' and `` ``suspended'' is 
disqualified.'' in their places, respectively.
    The revision and addition read as follows:


2.101   Definitions.

* * * * *
    Conviction means a judgment or conviction of a criminal offense by 
any court of competent jurisdiction, whether entered upon a verdict or 
a plea, and includes a conviction entered upon a plea of nolo 
contendere. For use in subpart 9.4, see the definition at 9.403. For 
use in subpart 26.5, see the definition at 26.503.
* * * * *
    Suspending and debarring official means--
    (1) An agency head; or
    (2) A designee authorized by the agency head to impose a suspension 
and/or a debarment.
* * * * *

PART 3--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF 
INTEREST


3.104-7   [Amended]

0
3. Amend section 3.104-7 by removing from paragraph (d)(3) ``suspending 
or'' and adding ``suspending and'' in its place.

PART 9--CONTRACTOR QUALIFICATIONS


9.104-5   [Amended]

0
4. Amend section 9.104-5 by removing from paragraph (b)(3) ``suspending 
or'' and adding ``suspending and'' in its place.

0
5. Amend section 9.104-6 by--
0
a. Revising paragraph (b)(4); and
0
b. Removing from paragraph (c) introductory text ``debarred or 
suspended'' and adding ``debarred, suspended, or has agreed to a 
voluntary exclusion'' in its place.
    The revision reads as follows:


9.104-6   Federal Awardee Performance and Integrity Information System.

* * * * *
    (b) * * *
    (4) Since FAPIIS may contain information on any of the offeror's 
previous contracts and information covering a 5-year period, some of 
that information may not be relevant to a determination of present 
responsibility, e.g., a prior administrative action such as debarment, 
suspension, voluntary exclusion, or administrative agreement, that has 
expired or otherwise been resolved, or information relating to 
contracts for completely different products or services.
* * * * *


9.402   [Amended]

0
6. Amend section 9.402 by--
0
a. In paragraph (b):
0
i. Removing ``sanctions'' and adding ``remedies'' in its place; and
0
ii. Removing ``set forth''; and
0
b. Removing from paragraph (d) ``Interagency Committee on Debarment and 
Suspension'' and ``Section 873'' and adding ``Interagency Suspension 
and Debarment Committee'' and ``section 873'' in their places, 
respectively.

0
7. Amend section 9.403 by--
0
a. Adding in alphabetical order the definition of ``Administrative 
agreement'';
0
b. Revising the definition of ``Civil judgment'';
0
c. Adding in alphabetical order the definition of ``Conviction'';
0
d. Removing the definition of ``Debarring official'';
0
e. Adding a sentence to the end of the definition of ``Nonprocurement 
Common Rule'';
0
f. Adding in alphabetical order the definition of ``Pre-notice 
letter'';
0
g. Removing the definition of ``Suspending official''; and
0
h. Adding in alphabetical order the definition of ``Voluntary 
exclusion''.
    The additions and revision read as follows:


9.403  Definitions.

* * * * *
    Administrative agreement means an agreement between an agency 
suspending and debarring official and the contractor used to resolve a 
suspension or debarment proceeding, or a potential suspension or 
debarment proceeding.
* * * * *
    Civil judgment means the disposition of a civil action by any court 
of competent jurisdiction, whether by verdict, decision, settlement, 
stipulation, other disposition that creates a civil liability for the 
complained of wrongful acts, or a final determination of liability 
under the Program Fraud Civil Remedies Act of 1986 (31 U.S.C. 3801-
3812).
* * * * *
    Conviction means--
    (1) A judgment or any other determination of guilt of a criminal 
offense by any court of competent jurisdiction, whether entered upon a 
verdict or plea, including a plea of nolo contendere; or
    (2) Any other resolution that is the functional equivalent of a 
judgment establishing a criminal offense by a court of competent 
jurisdiction, including probation before judgment and deferred 
prosecution. A disposition without the participation of the court is 
the functional equivalent of a judgment only if it includes an 
admission of guilt.
* * * * *
    Nonprocurement Common Rule * * * See 2 CFR part 180 and agency 
enacting regulations in 2 CFR subtitle B.
    Pre-notice letter means a written correspondence issued to a 
contractor in a suspension or debarment matter,

[[Page 512]]

which does not immediately result in an exclusion or ineligibility. The 
letter is issued at the discretion of the suspending and debarring 
official. The letter is not a mandatory step in the suspension or 
debarment process.
* * * * *
    Voluntary exclusion means a contractor's written agreement to be 
excluded for a period under the terms of a settlement between the 
contractor and the suspending and debarring official of one or more 
agencies. A voluntary exclusion must have Governmentwide effect.


9.404   [Amended]

0
8. Amend section 9.404 by--
0
a. Removing from paragraph (b)(1) ``debarment, declared ineligible,'' 
and adding ``debarment, voluntarily excluded, declared ineligible,'' in 
its place;
0
b. Removing from paragraph (c)(3) introductory text ``exclusion 
accomplished by the Agency'' and adding ``exclusion, including each 
voluntary exclusion, accomplished by the agency'' in its place; and
0
c. Removing from paragraph (c)(4) ``or proposed debarment taken by'' 
and adding ``proposed debarment, or voluntary exclusion taken or 
entered into by'' in its place.

0
9. Amend section 9.405 by--
0
a. Revising paragraph (a); and
0
b. Removing from paragraph (d) ``or proposed for debarment are'' and 
adding ``proposed for debarment, or voluntarily excluded, are'' in its 
place.
    The revision reads as follows:


9.405   Effect of listing.

    (a) Contractors debarred, suspended, proposed for debarment, or 
voluntarily excluded, are excluded from receiving contracts, and 
agencies shall not solicit offers from, award contracts to, or consent 
to subcontracts with these contractors, unless the agency head 
determines that there is a compelling reason for such action (see 
9.405-1(a)(2), 9.405-2, 9.406-1(d), 9.407-1(d), and 26.505(e)). 
Contractors debarred, suspended, proposed for debarment, or voluntarily 
excluded, are also excluded from conducting business with the 
Government as agents or representatives of other contractors.
* * * * *


9.405-1   [Amended]

0
10. Amend section 9.405-1 by--
0
a. Removing from paragraph (a) heading ``or proposed for debarment'' 
and adding ``proposed for debarment, or voluntarily excluded'' in its 
place;
0
b. Removing from paragraph (a)(1) ``or proposed debarment of'' and ``or 
proposed for debarment unless'' and adding ``proposed debarment, or 
voluntary exclusion, of'' and ``proposed for debarment, or voluntarily 
excluded, unless'' in their places, respectively; and
0
c. Removing from paragraph (a)(2) introductory text ``or proposed for 
debarment, unless'' and adding ``proposed for debarment, or voluntarily 
excluded, unless'' in its place.


9.405-2   [Amended]

0
11. Amend section 9.405-2 by--
0
a. Removing from paragraph (a) ``or proposed for debarment is'' and 
adding ``proposed for debarment, or voluntarily excluded, is'' in its 
place;
0
b. Removing from paragraph (b) introductory text ``or proposed for 
debarment, unless'', ``or proposed for debarment as'', ``Protecting the 
Government's Interests'', and ``or Proposed for Debarment, to'' and 
adding ``proposed for debarment, or voluntarily excluded, unless'', 
``proposed for debarment, or voluntarily excluded, as'', ``Protecting 
the Government's Interest'', and ``Proposed for Debarment, or 
Voluntarily Excluded, to'' in their places, respectively; and
0
c. Removing from paragraph (b)(4) ``or proposed debarment'' and adding 
``proposed debarment, or voluntary exclusion'' in its place.

0
12. Revise section 9.406-1 to read as follows:


9.406-1   General.

    (a) It is the suspending and debarring official's responsibility to 
determine whether debarment is in the Government's interest. The 
suspending and debarring official may, in the public interest, debar a 
contractor for any of the causes in 9.406-2, using the procedures in 
9.406-3. The existence of a cause for debarment, however, does not 
necessarily require that the contractor be debarred; the seriousness of 
the contractor's acts or omissions and any remedial measures, 
mitigating factors, or aggravating factors should be considered in 
making any debarment decision. Before arriving at any debarment 
decision, the suspending and debarring official should consider factors 
such as the following (some of the factors below could apply to 
individuals such as contractors that are individuals, and are so 
marked):
    (1) Whether the contractor had effective standards of conduct and 
internal control systems in place at the time of the activity which 
constitutes cause for debarment or had adopted such procedures prior to 
any Government investigation of the activity cited as a cause for 
debarment.
    (2) Whether the contractor (including an individual) brought the 
activity cited as a cause for debarment to the attention of the 
appropriate Government agency in a timely manner.
    (3) Whether the contractor has fully investigated the circumstances 
surrounding the cause for debarment (or the individual cooperated with 
the investigation) and, if so, made the result of the investigation 
available to the suspending and debarring official.
    (4) Whether the contractor (including an individual) cooperated 
fully with Government agencies during the investigation and any court 
or administrative action.
    (5) Whether the contractor (including an individual) has paid or 
has agreed to pay all criminal, civil, and administrative liability for 
the improper activity, including any investigative or administrative 
costs incurred by the Government, and has made or agreed to make full 
restitution.
    (6) Whether the contractor has taken appropriate disciplinary 
action against the individuals responsible for the activity which 
constitutes cause for debarment.
    (7) Whether the contractor (including an individual) has 
implemented or agreed to implement remedial measures, including any 
identified by the Government.
    (8)(i) Whether the contractor has instituted or agreed to institute 
new or revised review and control procedures, ethics training, or other 
relevant training programs.
    (ii) For an individual, whether the individual has attended 
relevant remediation training.
    (9) Whether the contractor (including an individual) has had 
adequate time to eliminate the circumstances that led to the cause for 
debarment.
    (10)(i) Whether the contractor's management recognizes, accepts, 
and understands the seriousness of the misconduct giving rise to the 
cause for debarment and has implemented programs to prevent recurrence.
    (ii) For an individual, whether the individual recognizes, accepts, 
and understands the seriousness of the misconduct giving rise to the 
cause for debarment and has adopted practices to prevent recurrence.
    (11) Whether the contractor (including an individual) has a pattern 
or prior history of wrongdoing, the frequency of incidents and/or 
duration of the wrongdoing, and the actual or potential harm or impact 
that results, or may result, from the wrongdoing.
    (12) Whether and to what extent the contractor (including an 
individual) planned, initiated, or carried out the

[[Page 513]]

wrongdoing, and the kind of positions within the contractor's 
organization held by the individual involved in the wrongdoing.
    (13) Whether the wrongdoing was pervasive within the contractor's 
organization.
    (14) Whether the individual or the contractor's principals 
tolerated the offense.
    (15) Whether the contractor (including an individual) is or has 
been excluded or disqualified by an agency of the Federal Government or 
has not been allowed to participate in State or local contracts or 
assistance agreements on a basis of conduct similar to one or more of 
the causes for debarment specified in this subpart.
    (16) Whether the contractor (including an individual) has entered 
into an administrative agreement with a Federal agency or a similar 
agreement with a State or local government that is not Governmentwide 
but is based on conduct similar to one or more of the causes for 
debarment specified in this subpart.
    (17) Whether there are any other factors to consider for the 
contractor (including an individual) appropriate to the circumstances 
of a particular case.
    (b) The existence or nonexistence of any aggravating or mitigating 
factors or remedial measures such as set forth in paragraph (a) of this 
section is not necessarily determinative of a contractor's present 
responsibility. Accordingly, if a cause for debarment exists, the 
contractor has the burden of demonstrating, to the satisfaction of the 
suspending and debarring official, its present responsibility and that 
debarment is not necessary.
    (c) Debarment constitutes debarment of all divisions or other 
organizational elements of the contractor, unless the debarment 
decision is limited by its terms to specific divisions, organizational 
elements, or commodities. The suspending and debarring official may 
extend the debarment decision to include any affiliates of the 
contractor if they are--
    (1) Specifically named; and
    (2) Given written notice of the proposed debarment and an 
opportunity to respond (see 9.406-3(c)).
    (d) A contractor's debarment, or proposed debarment, shall be 
effective throughout the executive branch of the Government, unless the 
agency head or a designee (except see 26.505(e)) states in writing the 
compelling reasons justifying continued business dealings between that 
agency and the contractor.
    (e)(1) When the suspending and debarring official has authority to 
debar contractors from both contracts pursuant to the Federal 
Acquisition Regulation in this chapter and contracts for the purchase 
of Federal personal property pursuant to the Federal Management 
Regulation (FMR) in 41 CFR part 102-38, that official shall consider 
simultaneously debarring the contractor from the award of acquisition 
contracts and from the purchase of Federal personal property.
    (2) When debarring a contractor from the award of acquisition 
contracts and from the purchase of Federal personal property, the 
debarment notice shall so indicate and the appropriate FAR and FMR 
citations shall be included.


9.406-2   [Amended]

0
13. Amend section 9.406-2 by removing from the introductory text ``The 
debarring'' and adding ``The suspending and debarring'' in its place.

0
14. Amend section 9.406-3 by--
0
a. Removing from paragraph (a) ``the debarring official'' and adding 
``the suspending and debarring official'' in its place;
0
b. Revising the heading of paragraph (b), paragraphs (b)(1) and (c), 
the heading of paragraph (d), and paragraph (d)(1);
0
c. Removing from paragraph (d)(2)(i) ``The debarring official'' and 
adding ``The suspending and debarring official'' in its place;
0
d. Removing from paragraph (d)(2)(ii) ``The debarring official'' 
wherever it appears and adding ``The suspending and debarring 
official'' in its place;
0
e. Removing from paragraph (d)(2)(iii) ``The debarring official's'' and 
adding ``The suspending and debarring official's'' in its place;
0
f. Revising the heading of paragraph (e) and paragraph (e)(1) 
introductory text;
0
g. Removing from paragraph (e)(1)(iv) ``9.406-1(c)'' and adding 
``9.406-1(d)'' in its place;
    h. Removing from paragraph (e)(2) ``the debarring official'' and 
``by certified mail, return receipt requested'' and adding ``the 
suspending and debarring official'' and ``using the procedures in 
paragraphs (c)(1) and (2) of this section'' in their places, 
respectively;
0
i. Revising paragraph (f); and
0
j. Adding paragraphs (g) and (h).
    The revisions and additions read as follows:


9.406-3  Procedures.

* * * * *
    (b) Decision-making process. (1) Agencies shall establish 
procedures governing the debarment decision-making process that are as 
informal as is practicable, consistent with principles of fundamental 
fairness. These procedures shall afford the contractor (and any 
specifically named affiliates) an opportunity to submit, in person, in 
writing, or through a representative, information and argument in 
opposition to the proposed debarment. If the suspending and debarring 
official extends the opportunity for the contractor to submit material 
in opposition, then the official should also give a deadline for 
submission of materials. The suspending and debarring official may use 
flexible procedures to allow a contractor to present matters in 
opposition in person or remotely through appropriate technology; if so, 
the suspending and debarring official should change the notice in 
paragraph (c)(3)(iv) of this section to include those flexible 
procedures.
* * * * *
    (c) Notice of proposal to debar. A notice of proposed debarment 
shall be issued by the suspending and debarring official to the 
contractor and any specifically named affiliates.
    (1) The written notice shall be sent--
    (i) By U.S. mail or private delivery service to the last known 
street address, with delivery notification service;
    (ii) By email to the point of contact email address in the 
contractor's SAM registration, if any, or to the last known email 
address as confirmed by the agency; or
    (iii) By certified mail to the last known street address with 
return receipt requested.
    (2) The notice shall be sent--
    (i) To the contractor, the contractor's identified counsel for 
purposes of the administrative proceedings, or the contractor's agent 
for service of process; and
    (ii) For each specifically named affiliate, to the affiliate 
itself, the affiliate's identified counsel for purposes of the 
administrative proceedings, or the affiliate's agent for service of 
process.
    (3) The notice shall state--
    (i) That debarment is being considered;
    (ii) The reasons for the proposed debarment in terms sufficient to 
put the contractor on notice of the conduct or transaction(s) upon 
which it is based;
    (iii) The cause(s) relied upon under 9.406-2 for proposing 
debarment;
    (iv) That, within 30 days after receipt of the notice, the 
contractor may submit, in person, in writing, or through a 
representative, information and argument in opposition to the proposed 
debarment, including any additional specific information that raises a 
genuine dispute over the material facts;

[[Page 514]]

    (v) The agency's procedures governing debarment decision making;
    (vi) The effect of the issuance of the notice of proposed 
debarment;
    (vii) The potential effect of an actual debarment;
    (viii) That in addition to any information and argument in 
opposition to a proposed debarment, the contractor must identify--
    (A) Specific facts that contradict the statements contained in the 
notice of proposed debarment. Include any information about any of the 
factors listed in 9.406-1(a). A general denial is insufficient to raise 
a genuine dispute over facts material to the proposed debarment;
    (B) All existing, proposed, or prior exclusions and all similar 
actions taken by Federal, State, or local agencies, including 
administrative agreements that affect only those agencies;
    (C) All criminal and civil proceedings not included in the notice 
of proposed debarment that grew out of facts relevant to the cause(s) 
stated in the notice; and
    (D) All of the contractor's affiliates; and
    (ix) That if the contractor fails to disclose the information in 
paragraph (c)(3)(viii) of this section, or provides false information, 
the agency taking the action may seek further criminal, civil, or 
administrative action against the contractor, as appropriate.
    (d) Suspending and debarring official's decision. (1) In actions 
based upon a conviction or civil judgment, or in which there is no 
genuine dispute over material facts, the suspending and debarring 
official shall make a decision on the basis of all the information in 
the administrative record, including any submission made by the 
contractor. If no suspension is in effect, the decision shall be made 
within 45 days from the date that the official administrative record is 
closed, unless the suspending and debarring official extends this 
period for good cause. The official record closes upon the expiration 
of the contractor's time to submit information and argument in 
opposition, including any extensions (see paragraph (b)(1) of this 
section).
* * * * *
    (e) Notice of suspending and debarring official's decision. (1) If 
the suspending and debarring official decides to impose debarment, the 
contractor and any affiliates involved shall be given prompt notice 
using the procedures in paragraphs (c)(1) and (2) of this section--
* * * * *
    (f) Administrative agreements. (1) If the contractor enters into an 
administrative agreement with the Government in order to resolve a 
debarment or potential debarment proceeding, the suspending and 
debarring official shall access the website (available at https://www.cpars.gov, then select FAPIIS), enter the requested information, 
and upload documentation reflecting the administrative agreement.
    (2) The suspending and debarring official is responsible for the 
timely and accurate submission of documentation reflecting the 
administrative agreement. The submission should be made within 3 
working days.
    (3) With regard to information that may be covered by a disclosure 
exemption under the Freedom of Information Act, the suspending and 
debarring official shall follow the procedures at 9.105-2(b)(2)(iv).
    (g) Voluntary exclusions. (1) If the contractor enters into a 
voluntary exclusion with the Government in order to resolve a debarment 
or potential debarment matter, the suspending and debarring official 
shall access the website (available at https://www.sam.gov) and enter 
the requested information into the exclusions section of SAM (see 
9.404(c)(3)).
    (2) The suspending and debarring official is responsible for the 
timely and accurate submission of documentation reflecting the 
voluntary exclusion. The submission should be made within 3 working 
days.
    (3) Regarding information that may be covered by a disclosure 
exemption under the Freedom of Information Act, the suspending and 
debarring official shall follow the procedures at 9.105-2(b)(2)(iv).
    (h) Pre-notice letters. Prior to initiating a proposed debarment, a 
pre-notice letter may be issued at the discretion of the agency 
suspending and debarring official. A pre-notice letter is not required 
to initiate debarment under this subpart. (See 9.403.)


9.406-4  [Amended]

0
15. Amend section 9.406-4 by--
0
a. Removing from paragraph (b) and paragraph (c) introductory text 
``The debarring official'' and adding ``The suspending and debarring 
official'' in their places; and
0
b. Removing from paragraph (c)(5) ``the debarring official'' and adding 
``the suspending and debarring official'' in its place.

0
16. Amend section 9.407-1 by--
0
a. Removing from paragraph (a) ``suspending official'' and adding 
``suspending and debarring official'' in its place;
0
b. Revising paragraph (b);
0
c. Removing from paragraph (c) introductory text ``suspending 
official'' and adding ``suspending and debarring official'' in its 
place;
0
d. Revising paragraph (e)(1); and
0
e. Removing from paragraph (e)(2) ``FAR and FPMR'' and adding ``FAR and 
FMR'' in its place.
    The revisions read as follows:


9.407-1  General.

* * * * *
    (b)(1) Suspension is a serious action to be imposed on the basis of 
adequate evidence, pending the completion of an investigation or legal 
proceedings, when it has been determined that immediate action is 
necessary to protect the Government's interest. In deciding whether 
immediate action is necessary to protect the Government's interest, the 
suspending and debarring official has wide discretion. The suspending 
and debarring official may infer the necessity for immediate action to 
protect the Government's interest either from the nature of the 
circumstances giving rise to a cause for suspension or from potential 
business relationships or involvement with a program of the Federal 
Government. In assessing the adequacy of the evidence, agencies should 
consider how much information is available, how credible it is given 
the circumstances, whether or not important allegations are 
corroborated, and what inferences can reasonably be drawn as a result. 
This assessment should include an examination of basic documents such 
as contracts, inspection reports, and correspondence. An indictment or 
other official findings by Federal, State, or local bodies that 
determine factual and/or legal matters, constitutes adequate evidence 
for purposes of suspension actions.
    (2) The existence of a cause for suspension does not necessarily 
require that the contractor be suspended. The suspending and debarring 
official should consider the seriousness of the contractor's acts or 
omissions and may, but is not required to, consider remedial measures, 
mitigating factors, or aggravating factors, such as those in 9.406-
1(a). A contractor has the burden of promptly presenting to the 
suspending and debarring official evidence of remedial measures or 
mitigating factors when it has reason to know that a cause for 
suspension exists. The existence or nonexistence of any remedial 
measures or aggravating or mitigating factors is not necessarily 
determinative of a contractor's present responsibility.
* * * * *

[[Page 515]]

    (e)(1) When the suspending and debarring official has authority to 
suspend contractors from both contracts pursuant to the Federal 
Acquisition Regulation in this chapter and contracts for the purchase 
of Federal personal property pursuant to Federal Management Regulation 
(FMR) in 41 CFR part 102-38, that official shall consider 
simultaneously suspending the contractor from the award of acquisition 
contracts and from the purchase of Federal personal property.
* * * * *


9.407-2   [Amended]

0
17. Amend section 9.407-2 by removing from paragraphs (a) introductory 
text and (c) ``The suspending official'' and adding ``The suspending 
and debarring official'' in their places.

0
18. Amend section 9.407-3 by--
0
a. Removing from paragraph (a) ``suspending official'' and adding 
``suspending and debarring official'' in its place;
0
b. Revising the heading of paragraph (b) and paragraph (b)(1);
0
c. Removing from paragraph (b)(2) introductory text ``of Department of 
Justice advice, that'' and adding ``of advice from the Department of 
Justice, a U.S. Attorney's office, State attorney general's office, or 
a State or local prosecutor's office, that'' in its place;
0
d. Removing from paragraph (c) introductory text ``by certified mail, 
return receipt requested'' and adding ``using the procedures in 9.406-
3(c)(1) and (2)'' in its place;
0
e. Revising paragraph (c)(1);
0
f. Removing from the end of paragraph (c)(5) the word ``and'';
0
g. Revising paragraph (c)(6);
0
h. Adding paragraphs (c)(7) and (8);
0
i. Revising paragraph (d) heading and paragraph (d)(1);
0
j. Removing from paragraph (d)(2)(i) ``suspending official'' and adding 
``suspending and debarring official'' in its place;
0
k. Removing from paragraph (d)(2)(ii) ``suspending official'' wherever 
it appears and adding ``suspending and debarring official'' in its 
place;
0
l. Removing from paragraph (d)(2)(iii) ``suspending official's'' and 
adding ``suspending and debarring official's'' in its place;
0
m. Revising paragraphs (d)(3) and (4);
0
n. Adding a heading for paragraph (e);
0
o. Revising paragraphs (e)(1) and (2);
0
p. Removing from paragraph (e)(3) ``suspending official'' and adding 
``suspending and debarring official'' in its place; and
0
q. Adding paragraphs (f) and (g).
    The revisions and additions read as follows:


9.407-3   Procedures.

* * * * *
    (b) Decision-making process. (1) Agencies shall establish 
procedures governing the suspension decision-making process that are as 
informal as is practicable, consistent with principles of fundamental 
fairness. These procedures shall afford the contractor (and any 
specifically named affiliates) an opportunity, following the imposition 
of suspension, to submit, in person, in writing, or through a 
representative, information and argument in opposition to the 
suspension. If the suspending and debarring official extends the 
opportunity for the contractor to submit material in opposition, then 
the official should also give a deadline for submission of materials. 
The suspending and debarring official may use the flexible procedures 
in 9.406-3(b)(1); if so, the suspending and debarring official should 
change the notice in paragraph (c)(5) of this section to include those 
flexible procedures.
* * * * *
    (c) * * *
    (1) That they have been suspended and that the suspension is based 
on an indictment or other adequate evidence that the contractor has 
committed irregularities--
    (i) Of a serious nature in business dealings with the Government; 
or
    (ii) Seriously reflecting on the propriety of further Government 
dealings with the contractor--any such irregularities shall be 
described in terms sufficient to place the contractor on notice without 
disclosing the Government's evidence;
* * * * *
    (6) That additional proceedings to determine disputed material 
facts will be conducted unless--
    (i) The action is based on an indictment; or
    (ii) A determination is made, on the basis of advice by the 
Department of Justice, a U.S. Attorney's office, State attorney 
general's office, or a State or local prosecutor's office, that the 
substantial interests of the Government in pending or contemplated 
legal proceedings based on the same facts as the suspension would be 
prejudiced;
    (7) That, in addition to any information and argument in opposition 
to a suspension, the contractor must identify--
    (i) Specific facts that contradict the statements contained in the 
notice of suspension. Include any information about any of the factors 
listed in 9.406-1(a). A general denial is insufficient to raise a 
genuine dispute over facts material to the suspension;
    (ii) All existing, proposed, or prior exclusions and all similar 
actions taken by Federal, State, or local agencies, including 
administrative agreements that affect only those agencies;
    (iii) All criminal and civil proceedings not included in the notice 
of suspension that grew out of facts relevant to the cause(s) stated in 
the notice; and
    (iv) All of the contractor's affiliates; and
    (8) That if the contractor fails to disclose the information in 
paragraph (c)(7) of this section or provides false information, the 
agency taking the action may seek further criminal, civil, or 
administrative action against the contractor, as appropriate.
    (d) Suspending and debarring official's decision. (1) The 
suspending and debarring official's decision shall be based on all the 
information in the administrative record, including any submission made 
by the contractor, for actions--
    (i) Based on an indictment;
    (ii) In which the contractor's submission does not raise a genuine 
dispute over material facts; or
    (iii) In which additional proceedings to determine disputed 
material facts have been denied on the basis of advice from the 
Department of Justice, a U.S. Attorney's office, State attorney 
general's office, or a State or local prosecutor's office.
* * * * *
    (3) The suspending and debarring official may modify or terminate 
the suspension or leave it in force (for example, see 9.406-4(c) for 
the reasons for reducing the period or extent of debarment). However, a 
decision to modify or terminate the suspension shall be without 
prejudice to the subsequent imposition of--
    (i) Suspension by any other agency; or
    (ii) Debarment by any agency.
    (4) Prompt written notice of the suspending and debarring 
official's decision shall be sent to the contractor and any affiliates 
involved, using the procedures in 9.406-3(c)(1) and (2).
    (e) Administrative agreement. (1) If the contractor enters into an 
administrative agreement with the Government in order to resolve a 
suspension or potential suspension proceeding, the suspending and 
debarring official shall access the website (available at https://www.cpars.gov, then select FAPIIS), enter the requested information, 
and

[[Page 516]]

upload documentation reflecting the administrative agreement.
    (2) The suspending and debarring official is responsible for the 
timely and accurate submission of documentation reflecting the 
administrative agreement. The submission should be made within 3 
working days.
* * * * *
    (f) Voluntary exclusion. (1) If the contractor enters into a 
voluntary exclusion with the Government in order to resolve a 
suspension or potential suspension proceeding, the suspending and 
debarring official shall access the website (available at https://www.sam.gov) and enter the requested information into the exclusions 
section of SAM (see 9.404(c)(3)).
    (2) The suspending and debarring official is responsible for the 
timely and accurate submission of documentation reflecting the 
voluntary exclusion. The submission should be made within 3 working 
days.
    (3) Regarding information that may be covered by a disclosure 
exemption under the Freedom of Information Act, the suspending and 
debarring official shall follow the procedures at 9.105-2(b)(2)(iv).
    (g) Pre-notice letter. Prior to initiating a suspension, a pre-
notice letter may be issued at the discretion of the agency suspending 
and debarring official. A pre-notice letter is not required to initiate 
suspension under this subpart. (See 9.403.)

0
19. Amend section 9.407-4 by--
0
a. Removing from paragraph (a) ``of investigation'', ``suspending 
official'', and ``this subsection'' and adding ``of an investigation'', 
``suspending and debarring official'', and ``this section'' in their 
places, respectively;
0
b. Removing from paragraph (b) ``Assistant Attorney General requests'' 
and adding ``office of a U.S. Assistant Attorney General, U.S. 
Attorney, or other responsible prosecuting official requests'' in its 
place; and
0
c. Revising paragraph (c).
    The revision reads as follows:


9.407-4   Period of suspension.

* * * * *
    (c) The suspending and debarring official shall notify the 
Department of Justice or other responsible prosecuting official of the 
proposed termination of the suspension, at least 30 days before the 12-
month period expires, to give that official an opportunity to request 
an extension on the Government's behalf.


9.409   [Amended]

0
20. Amend section 9.409 by removing the text ``Protecting the 
Government's Interests when Subcontracting with Contractors Debarred, 
Suspended, or Proposed for Debarment, in'' and adding ``Protecting the 
Government's Interest when Subcontracting with Contractors Debarred, 
Suspended, Proposed for Debarment, or Voluntarily Excluded, in'' in its 
place.

PART 22--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS


22.1504   [Amended]

0
21. Amend section 22.1504 by--
0
a. Removing from paragraph (b)(2) ``The suspending official'' and 
adding ``The suspending and debarring official'' in its place; and
0
b. Removing from paragraph (b)(3) ``The debarring official'' and adding 
``The suspending and debarring official'' in its place.


22.1704   [Amended]

0
22. Amend 22.1704 by removing from paragraph (c)(2)(i) introductory 
text ``suspending or debarring'' and adding ``suspending and 
debarring'' in its place.

0
23. Amend section 22.1802 by revising paragraph (e) to read as follows:


22.1802   Policy.

* * * * *
    (e) DHS and the Social Security Administration (SSA) may terminate 
a contractor's memorandum of understanding (MOU) and deny access to the 
E-Verify system in accordance with the terms of the MOU. If DHS or SSA 
terminates a contractor's MOU, the terminating agency must refer the 
contractor to a suspending and debarring official for possible 
suspension or debarment action. During the period between termination 
of the MOU and a decision by the suspending and debarring official 
whether to suspend or debar, the contractor is excused from its 
obligations under paragraph (b) of the clause at 52.222-54. If the 
contractor is suspended, debarred, or subject to a voluntary exclusion 
as a result of the MOU termination, the contractor is not eligible to 
participate in E-Verify during the period of its suspension, debarment, 
or voluntary exclusion. If the contractor is not suspended, debarred, 
or subject to a voluntary exclusion, then the contractor must reenroll 
in E-Verify.

PART 25--FOREIGN ACQUISITION


25.206   [Amended]

0
24. Amend section 25.206 by removing from paragraph (c)(4) ``suspending 
or debarring'' and ``Subpart 9.4'' and adding ``suspending and 
debarring'' and ``subpart 9.4'' in their places, respectively.


25.607   [Amended]

0
25. Amend section 25.607 by removing from paragraph (c)(4) ``suspending 
or debarring'' and adding ``suspending and debarring'' in its place.


25.702-3   [Amended]

0
26. Amend section 25.702-3 by--
0
a. Removing from paragraph (b) ``suspending official'' and ``Subpart'' 
and adding ``suspending and debarring official'' and ``subpart'' in 
their places, respectively; and
0
b. Removing from paragraph (c) ``The debarring'' and ``Subpart'' and 
adding ``The suspending and debarring'' and ``subpart'' in their 
places, respectively.


25.703-2   [Amended]

0
27. Amend section 25.703-2 by--
0
a. Removing from paragraph (b)(1) ``commercial services, '' and adding 
``commercial services,'' in its place;
0
b. Removing from paragraph (b)(2) ``suspending official'' and adding 
``suspending and debarring official'' in its place; and
0
c. Removing from paragraph (b)(3) ``The debarring official'' and adding 
``The suspending and debarring official'' in its place.

PART 26--OTHER SOCIOECONOMIC PROGRAMS


26.505   [Amended]

0
28. Amend section 26.505 by removing from paragraph (c) ``suspension 
and debarment'' and adding ``suspending and debarring'' in its place.

PART 33--PROTESTS, DISPUTES, AND APPEALS


33.102   [Amended]

0
29. Amend section 33.102 by removing from paragraph (b)(3)(iii) 
``debarment official'' and ``Subpart'' and adding ``suspending and 
debarring official'' and ``subpart'' in their places, respectively.

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
30. Amend section 52.209-6 by--
0
a. Revising the section heading and clause title and date;
0
b. Removing from paragraph (c) ``suspended, or proposed for debarment 
by'' and adding ``suspended, proposed for debarment, or voluntarily 
excluded, by'' in its place;
0
c. Removing from paragraph (d) introductory text ``or proposed for

[[Page 517]]

debarment'' and adding ``proposed for debarment, or voluntarily 
excluded'' in its place; and
0
d. Removing from paragraph (d)(4) ``suspension, or proposed debarment'' 
and adding ``suspension, proposed debarment, or voluntary exclusion'' 
in its place.
    The revisions read as follows:


52.209-6   Protecting the Government's Interest When Subcontracting 
With Contractors Debarred, Suspended, Proposed for Debarment, or 
Voluntarily Excluded.

* * * * *

Protecting the Government's Interest When Subcontracting With 
Contractors Debarred, Suspended, Proposed for Debarment, or Voluntarily 
Excluded (JAN 2025)

* * * * *

0
31. Amend section 52.212-5 by--
0
a. Revising paragraphs (b)(12), (32), and (40) and (e)(1)(xix); and
0
b. In Alternate II, revising the date of the alternate and paragraph 
(e)(1)(ii)(R).
    The revisions read as follows:


52.212-5   Contract Terms and Conditions Required To Implement Statutes 
or Executive Orders--Commercial Products and Commercial Services.

* * * * *
    (b) * * *
    _ (12) 52.209-6, Protecting the Government's Interest When 
Subcontracting With Contractors Debarred, Suspended, Proposed for 
Debarment, or Voluntarily Excluded. (JAN 2025) (31 U.S.C. 6101 note).
* * * * *
    _ (32) 52.222-19, Child Labor--Cooperation with Authorities and 
Remedies (JAN 2025) (E.O. 13126).
* * * * *
    _ (40) 52.222-54, Employment Eligibility Verification (JAN 2025) 
(Executive Order 12989). (Not applicable to the acquisition of 
commercially available off-the-shelf items or certain other types of 
commercial products or commercial services as prescribed in FAR 
22.1803.)
* * * * *
    (e)(1) * * *
    (xix) 52.222-54, Employment Eligibility Verification (JAN 2025) 
(E.O. 12989).
* * * * *
    Alternate II (JAN 2025) * * *
    (e)(1) * * *
    (ii) * * *
    (R) 52.222-54, Employment Eligibility Verification (JAN 2025) 
(Executive Order 12989).
* * * * *

0
32. Amend section 52.213-4 by revising paragraphs (b)(1)(iii) and 
(b)(2)(ii) to read as follows:


52.213-4  Terms and Conditions--Simplified Acquisitions (Other Than 
Commercial Products and Commercial Services).

* * * * *
    (b) * * *
    (1) * * *
    (iii) 52.222-19, Child Labor--Cooperation with Authorities and 
Remedies (JAN 2025) (E.O. 13126) (Applies to contracts for supplies 
exceeding the micro-purchase threshold, as defined in FAR 2.101 on the 
date of award of this contract).
* * * * *
    (2) * * *
    (ii) 52.209-6, Protecting the Government's Interest When 
Subcontracting with Contractors Debarred, Suspended, Proposed for 
Debarment, or Voluntarily Excluded (JAN 2025) (Applies to contracts 
over the threshold specified in FAR 9.405-2(b) on the date of award of 
this contract).
* * * * *

0
33. Amend section 52.222-19 by--
0
a. Revising the date of the clause;
0
b. Removing from paragraph (d)(2) ``suspending official'' and 
``Subpart'' and adding ``suspending and debarring official'' and 
``subpart'' in their places, respectively; and
0
c. Removing from paragraph (d)(3) ``The debarring'' and ``Subpart'' and 
adding ``The suspending and debarring'' and ``subpart'' in their 
places, respectively.
    The revision reads as follows:


52.222-19  Child Labor--Cooperation With Authorities and Remedies.

* * * * *

Child Labor--Cooperation With Authorities and Remedies (JAN 2025)

* * * * *

0
34. Amend section 52.222-54 by--
0
a. Revising the date of the clause;
0
b. Removing from paragraph (b)(5)(i) ``suspension or debarment'' and 
adding ``suspending and debarring'' in its place; and
0
c. Revising paragraph (b)(5)(ii).
    The revisions read as follows:


52.222-54  Employment Eligibility Verification.

* * * * *

Employment Eligibility Verification (JAN 2025)

* * * * *
    (b) * * *
    (5) * * *
    (ii) During the period between termination of the MOU and a 
decision by the suspending and debarring official whether to suspend 
or debar, the Contractor is excused from its obligations under 
paragraph (b) of this clause. If the Contractor is not suspended, 
debarred, or subject to a voluntary exclusion, then the Contractor 
must reenroll in E-Verify.
* * * * *
[FR Doc. 2024-31403 Filed 1-2-25; 8:45 am]
BILLING CODE 6820-EP-P`