[Federal Register Volume 87, Number 102 (Thursday, May 26, 2022)]
[Rules and Regulations]
[Pages 31957-31961]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-11207]


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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 212, 225, and 252

[Docket DARS-2020-0031]
RIN 0750-AK97


Defense Federal Acquisition Regulation Supplement: Prohibition on 
Contracting With Persons That Have Business Operations With the Maduro 
Regime (DFARS Case 2020-D010)

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 implement a statute that 
prohibits DoD from entering into contracts for the procurement of goods 
and services with any person that has business operations with an 
authority of the government of Venezuela that is not recognized as the 
legitimate government of Venezuela by the United States Government.

DATES: Effective May 26, 2022.

FOR FURTHER INFORMATION CONTACT: Kimberly Bass, telephone 571-372-6174.

SUPPLEMENTARY INFORMATION:

I. Background

    DoD published a proposed rule in the Federal Register at 85 FR 
53751 on August 31, 2020, to implement section 890 of the National 
Defense Authorization Act (NDAA) for Fiscal Year (FY) 2020 (Pub. L. 
116-92). Section 890 prohibits contracts for the procurement of goods 
and services with any person that has business operations with an 
authority of the government of Venezuela, subject to exceptions. Six 
respondents submitted public comments in response to the proposed rule.

II. Discussion and Analysis

    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 is provided, as follows:

A. Summary of Significant Changes From the Proposed Rule

    To further clarify and to eliminate any ambiguity, the solicitation 
provision 252.225-7055, Representation Regarding Business Operations 
with the Maduro Regime, was revised to clarify that ``. . . by 
submission of its offer, the Offeror represents that the Offeror is a 
person that--(1) Does not have any business operations with an 
authority of the Maduro regime or the government of Venezuela that is 
not recognized as the legitimate government of Venezuela by the U.S. 
Government; or . . .''. The contract clause 252.225-7056, Prohibition 
Regarding Business Operations with the Maduro Regime, applies to the 
entity that was awarded the contract. Therefore, no change was made to 
the clause.
    Additional revisions were made to the text and clause number 
designations to accommodate updated numerical designations required in 
the final rule. In addition, a revision was made to 225.7020-4, Joint 
Determination, to explicitly state that delegation authority is to 
remain at the level of Secretary of Defense and Secretary of State 
without power of redelegation.

B. Analysis of Public Comments

1. Support for the Rule
    Comment: Several respondents provided overall support of the rule. 
A respondent expressed support for the rule because it is an effectual 
way to limit the Maduro regime's access to American made or American 
preferred military technology. The respondent also expressed support 
for the exceptions for humanitarian aid. Another respondent supported 
the rule overall because limiting contracts is a push in opposition of 
the Maduro regime. A respondent commended the rule and hopes this is 
not a final step in solving unrest in Venezuela.
    Response: DoD acknowledges the respondents' support for the rule.
2. Joint Determination
    Comment: A respondent expressed concern that requiring a joint 
determination of both the Secretary of Defense and the Secretary of 
State that the restriction does not apply to certain acquisitions may 
limit the relief that can be provided to the people of Venezuela. 
Another respondent expressed similar concern with the high level of 
approval necessary for the joint determination and also expressed 
concern with the process for making the joint determination. A 
respondent included a list of proposed factors to consider in whether 
to seek a joint determination. A respondent further stated that there 
were no procedures or guidance on the Government determination process.
    Response: The proposed rule implements section 890 of the NDAA for 
FY 2020. Section 890 prohibits DoD from entering into a contract for 
the procurement of goods or services with any person that has business 
operations with an authority of the government of Venezuela that is not 
recognized as the legitimate government of Venezuela by the United 
States Government. Section 890 does not apply the prohibition to 
acquisitions where the Secretary of Defense and Secretary of State have 
jointly determined that the acquisition is necessary for providing 
humanitarian assistance, disaster relief, or urgent lifesaving measures 
to the people of Venezuela; carrying out noncombatant evacuations; or 
is otherwise vital to U.S. national security interests. The process of 
the joint determination is in accordance with internal Government 
operating procedures. The rule's implementation is consistent with the 
statutory requirements of section 890 and does not allow for further 
delegation of the authority for the joint determination. Thus, the 
final rule implements the authority for the joint determination at the 
level of the Secretary of Defense and Secretary of State.
3. National Security Waiver
    Comment: A couple of respondents provided questions relating to the 
lack of guidelines for securing a national security interest exception 
in the proposed rule.
    Response: The final rule is directly aligned with the statutory 
language and implements section 890 of the NDAA for FY 2020. The 
reference to national security interests appears in section 
890(b)(1)(A) and was implemented accordingly in DFARS 225.7020-4(a)(2) 
of the final rule.
4. Definitions
    Comment: A respondent stated that the definition of ``person'' is 
overly broad and could adversely affect contracts held by businesses 
that have no operations in, or connections with, Venezuela. Another 
respondent further stated that in light of the broad definition of 
``person'' and ``business operations'' in the rule, there is a lack of 
clarity in the solicitation provision 252.225-7055 as to whether an 
``offeror'' who certifies that it does not have any business operations 
with an authority of

[[Page 31958]]

the Maduro regime is submitting such statement on behalf of the offeror 
with a discrete unique identifier number or Commercial and Government 
Entity (CAGE) code or as ``person'' is defined under the proposed rule. 
The respondent also stated that the clause 252.225-7056 is not clear on 
whether the clause requires the contractor, specifically the legal 
entity that was awarded the contract, to refrain from engaging in 
business with the Maduro regime or whether the obligation extends to 
the contractor's ties within the definition of ``person''.
    Response: DoD acknowledges the respondent's comment. The final rule 
implements and is aligned with the statutory language as provided in 
section 890 of the NDAA for FY 2020. There is no certification 
requirement per 41 U.S.C. 1304; rather there is a representation 
requirement, which is less burdensome than a certification. To further 
explain and eliminate any ambiguity, the provision at DFARS 252.225-
7055 was revised to clarify that ``. . . by submission of its offer, 
the Offeror represents that the Offeror is a person that--(1) Does not 
have any business operations with an authority of the Maduro regime or 
the government of Venezuela that is not recognized as the legitimate 
government of Venezuela by the U.S. Government; or . . .''. The clause 
at DFARS 252.225-7056 applies to the entity that was awarded the 
contract. Accordingly, no change was made to the clause. In addition, 
the definitions, defined in the provision in the proposed rule, are 
listed and a cross-reference added to point to those terms being 
defined in the clause.
5. Adverse Impacts
    Comment: A respondent commented that the proposed rule would have 
adverse effects on U.S. defense programs, force readiness, the defense 
industrial base, and American workers. The respondent further requested 
that DoD conduct a review of the law's impact on the defense industrial 
base, military readiness, DoD acquisition programs as well as the 
economy and employment. Another respondent stated that implementing the 
rule without clear guidelines would have impacts to defense 
contractors.
    Response: The proposed rule implements section 890 of the NDAA for 
FY 2020 that prohibits contracts for the procurement of goods and 
services with any person that has business operations with an authority 
of the government of Venezuela, subject to the listed exceptions. 
Section 890 does not require a review of the defense industrial base, 
military readiness, DoD acquisition programs, the economy, or 
employment. Consequently, the rule implements the prohibition in 
accordance with section 890 of the NDAA for FY 2020 and unless certain 
exceptions apply requires contracting officers to include the provision 
and the clause in solicitations and contracts, including those for the 
acquisition of commercial items, and prohibits the award of a contract 
to a prohibited entity in accordance with the associated policy 
guidance.
6. Extension Request
    Comment: A couple of respondents requested an extension to the 
comment period for additional time to provide comments.
    Response: DoD acknowledges the extension request. The public 
comment period was not extended.
7. Out of Scope
a. Mitigation Measures
    Comment: A respondent stated the proposed rule does not contain any 
mitigation measures that would enable an American subsidiary that is 
ultimately foreign-owned to provide goods and services to DoD 
irrespective of how tangentially related another entity, that has 
business operations with the Maduro regime, may be to the U.S. company. 
The respondent further stated the rule poses a real impediment to the 
DoD's ability to contract with companies that offer mission-critical, 
lifesaving products and services to service members.
    Response: The comment is outside the scope of the rule. The final 
rule implements section 890 of the NDAA for FY 2020 and prohibits 
contracts for the procurement of goods and services with any person 
that has business operations with an authority of the government of 
Venezuela, subject to listed statutory exceptions. The statutory 
prohibition in section 890 does not allow for mitigation measures.
b. Additional Policy
    Comment: A respondent recommended the U.S. Government go further 
than this rule and adopt the recommendations outlined in the Atlantic 
Council's article titled ``The Maduro Regime's Illicit Activities: A 
Threat to Democracy in Venezuela and Security in Latin America''. The 
article calls for a task force comprised of various U.S. Government 
agencies that would focus on the alleged criminal enterprises around 
the Maduro regime.
    Response: The comment is outside the scope of the rule. The 
prohibition in section 890 of the NDAA for FY 2020 does not include 
requirements for a task force or the recommended additional policy 
measures. The final rule implements the statutory requirements in 
section 890, subject to the listed statutory exceptions and prohibits 
contracts for the procurement of goods and services with any person 
that has business operations with an authority of the government of 
Venezuela.

C. Other Changes

    The following changes have been made throughout the final rule:

--The reference to ``section 28 U.S.C. 1603(b)'' was changed to ``28 
U.S.C. 1603(b)'' in the definition of ``agency or instrumentality of 
the government of Venezuela.''
--``United States Government'' was changed to ``U.S. Government'' to 
comply with DFARS drafting conventions.

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

    This rule creates a new provision and a new clause: (1) DFARS 
252.225-7055, Representation Regarding Business Operations with the 
Maduro Regime; and (2) DFARS 252.225-7056, Prohibition Regarding 
Business Operations with the Maduro Regime. DoD applies the provision 
and the clause to solicitations, contracts, or subcontracts at or below 
the simplified acquisition threshold (SAT) and to the acquisition of 
commercial services and commercial products, including commercially 
available off-the-shelf (COTS) items, as defined at Federal Acquisition 
Regulation (FAR) 2.101. This DFARS rule implements section 890 of the 
NDAA for FY 2020. Section 890 prohibits contracts for the procurement 
of goods and services with any person that has business operations with 
an authority of the government of Venezuela, subject to exceptions.

A. Applicability to Contracts at or Below the Simplified Acquisition 
Threshold

    41 U.S.C. 1905 governs the applicability of laws to contracts or 
subcontracts in amounts not greater than the SAT. It is intended to 
limit the applicability of laws to such contracts or subcontracts. 41 
U.S.C. 1905 provides that if a provision of law contains criminal or 
civil penalties, or if the Federal Acquisition Regulatory Council makes 
a written determination that it is not in the best interest of the 
Federal Government to exempt contracts or subcontracts at or below the 
SAT, the law will apply to them. The Principal

[[Page 31959]]

Director, Defense Pricing and Contracting (DPC), is the appropriate 
authority to make comparable determinations for regulations to be 
published in the DFARS, which is part of the FAR system of regulations.

B. Applicability to Contracts for the Acquisition of Commercial 
Services and Commercial Products, Including COTS Items

    10 U.S.C. 2375 exempts contracts and subcontracts for the 
acquisition of commercial items (including COTS items) from provisions 
of law enacted after October 13, 1994, that, as determined by the Under 
Secretary of Defense for Acquisition and Sustainment (USD(A&S)), set 
forth policies, procedures, requirements, or restrictions for the 
acquisition of property or services unless--
    The provision of law--

--Provides for criminal or civil penalties;
--Requires that certain articles be bought from American sources 
pursuant to 10 U.S.C. 2533a or that strategic materials critical to 
national security be bought from American sources pursuant to 10 U.S.C. 
2533b; or
--Specifically refers to 10 U.S.C. 2375 and states that it shall apply 
to contracts and subcontracts for the acquisition of commercial 
services and commercial products (including COTS items); or USD (A&S) 
determines in writing that it would not be in the best interest of the 
Government to exempt contracts or subcontracts for the acquisition of 
commercial products and services from the applicability of the 
provision.

    This authority has been delegated to the Principal Director, 
Defense Pricing and Contracting.

C. Applicability

    Section 890 of the NDAA for FY 2020 is silent on applicability to 
contracts and subcontracts in amounts no greater than the SAT or for 
the acquisition of commercial services and commercial products 
including COTS items. Also, the statute does not provide for civil or 
criminal penalties. Therefore, it does not apply to contracts or 
subcontracts in amounts not greater than the SAT or to the acquisition 
of commercial products and commercial services unless the Principal 
Director, Defense Pricing and Contracting, makes a written 
determination as provided in 41 U.S.C. 1905 and 10 U.S.C. 2375.
    Not applying this rule to contracts and subcontracts at or below 
the SAT and for the acquisition of commercial services and commercial 
products, including COTS items, would exclude contracts intended to be 
covered by this rule and undermine the overarching purpose of the rule, 
which is to prohibit contracts for the procurement of goods and 
services with any person that has business operations with an authority 
of the government of Venezuela, subject to the listed exceptions. This 
is particularly true with regard to the acquisition of fuel and 
petroleum, procurements which are usually commercial products and 
commercial services. To not include the acquisition of fuel and 
petroleum within this prohibition or to not apply the prohibition at or 
below the SAT will unacceptably diminish the impact of these sanctions 
on the Maduro regime, the government of Venezuela that is not 
recognized by the United States Government as the legitimate government 
of Venezuela. Subsequently, DoD has applied the rule to contracts and 
subcontracts at or below the SAT and for the acquisition of commercial 
services and commercial products, including COTS items.

IV. Expected Impact of the Rule

    This rule creates new DFARS provision 252.225-7055, Representation 
Regarding Business Operations with the Maduro Regime, and new clause 
252.225-7056, Prohibition Regarding Business Operations with the Maduro 
Regime. The new provision and clause are prescribed at 225.7020-5(a) 
and (b). DoD has applied the requirements of section 890 of the NDAA 
for FY 2020 to contracts at or below the SAT. Section 890 prohibits DoD 
from entering into a contract for the procurement of products or 
services with any person that has business operations with an authority 
of the government of Venezuela that is not recognized as the legitimate 
government of Venezuela by the United States Government subject to the 
listed exceptions.
    The rule does not add any new burden. Contracting officers will 
include the provision and the clause in solicitations and contracts, 
including solicitations and contracts using FAR part 12 procedures for 
the acquisition of commercial services and commercial products 
including COTS items, unless an exception at 225.7020-3(b) applies or a 
joint determination has been made in accordance with 225.7020-4.

V. Executive Orders 12866 and 13563

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

VI. Congressional Review Act

    As required by the Congressional Review Act (5 U.S.C. 801-808) 
before an interim or final rule takes effect, DoD will submit a copy of 
the interim or final rule with the form, Submission of Federal Rules 
under the Congressional Review Act, to the U.S. Senate, the U.S. House 
of Representatives, and the Comptroller General of the United States. A 
major rule under the Congressional Review Act cannot take effect until 
60 days after it is published in the Federal Register. The Office of 
Information and Regulatory Affairs has determined that this rule is not 
a major rule as defined by 5 U.S.C. 804.

VII. Regulatory Flexibility Act

    A final regulatory flexibility analysis (FRFA) has been prepared 
consistent with the Regulatory Flexibility Act, 5 U.S.C. 601, et seq. 
The FRFA is summarized as follows:
    The final rule is necessary to revise the Defense Federal 
Acquisition Regulation Supplement (DFARS) to implement section 890 of 
the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2020 
that prohibits contracts for the procurement of goods and services with 
any person that has business operations with an authority of the 
government of Venezuela, subject to exceptions for contracts that are--
    <bullet> Jointly determined by the Secretary of Defense and the 
Secretary of State to be necessary for certain humanitarian or disaster 
relief purposes or vital to the national security interests of the 
United States;
    <bullet> Related to the operation and maintenance of the United 
States Government's consular offices and diplomatic posts in Venezuela; 
or
    <bullet> Awarded to a person that has a valid license to operate in 
Venezuela issued by the Office of Foreign Assets Control of the 
Department of the Treasury.
    The objective of the rule is to implement section 890 of the NDAA 
for FY 2020.

[[Page 31960]]

    No public comments were received in response to the initial 
regulatory flexibility analysis.
    DoD reviewed data obtained from the Federal Procurement Data System 
(FPDS) for FY 2017, FY 2018, and FY 2019 (including contracts that do 
not exceed the simplified acquisition threshold) to determine the 
estimated impact of the rule on U.S. small businesses. There were no 
DoD actions reported to FPDS in FY 2017 through FY 2019 for which the 
contractor is located in Venezuela or the place of performance is 
Venezuela.
    This rule does not include any new reporting, recordkeeping, or 
other compliance requirements for small entities.
    DoD has not identified any alternative approaches to the rule that 
would meet the requirements of the statute.

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. chapter 35).

List of Subjects in 48 CFR Parts 212, 225, and 252

    Government procurement.

Jennifer D. Johnson,
Editor/Publisher, Defense Acquisition Regulations System.

    Therefore, 48 CFR parts 212, 225, and 252 are amended as follows:

0
1. The authority citation for 48 CFR parts 212, 225, and 252 continues 
to read as follows:

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

PART 212--ACQUISITION OF COMMERCIAL ITEMS

0
2. Amend section 212.301 by adding paragraphs (f)(x)(II) and (JJ) to 
read as follows:


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

* * * * *
    (f) * * *
    (x) * * *
    (II) Use the provision at 252.225-7055, Representation Regarding 
Business Operations with the Maduro Regime, as prescribed in 225.7020-
5(a), to comply with section 890 of the National Defense Authorization 
Act for Fiscal Year 2020 (Pub. L. 116-92).
    (JJ) Use the clause at 252.225-7056, Prohibition Regarding Business 
Operations with the Maduro Regime, as prescribed in 225.7020-5(b), to 
comply with section 890 of the National Defense Authorization Act for 
Fiscal Year 2020 (Pub. L. 116-92).
* * * * *

PART 225--FOREIGN ACQUISITION

0
3. Add sections 225.7020, 225.7020-1, 225.7020-2, 225.7020-3, 225.7020-
4, and 225.7020-5 to subpart 225.70 to read as follows:
* * * * *
Sec.
225.7020 Prohibition on contracting with the Maduro regime.
225.7020-1 Definitions.
225.7020-2 Prohibition.
225.7020-3 Exceptions.
225.7020-4 Joint determination.
225.7020-5 Solicitation provision and contract clause.
* * * * *


225.7020  Prohibition on contracting with the Maduro regime.


225.7020-1  Definitions.

    As used in this section--
    Agency or instrumentality of the government of Venezuela means an 
agency or instrumentality of a foreign state as defined in 28 U.S.C. 
1603(b), with each reference in section 1603(b) to a foreign state 
deemed to be a reference to Venezuela.
    Business operations means engaging in commerce in any form, 
including acquiring, developing, maintaining, owning, selling, 
possessing, leasing, or operating equipment, facilities, personnel, 
products, services, personal property, real property, or any other 
apparatus of business or commerce.
    Government of Venezuela means the government of any political 
subdivision of Venezuela, and any agency or instrumentality of the 
government of Venezuela.
    Person means--
    (1) A natural person, corporation, company, business association, 
partnership, society, trust, or any other nongovernmental entity, 
organization, or group;
    (2) Any governmental entity or instrumentality of a government, 
including a multilateral development institution (as defined in section 
1701(c)(3) of the International Financial Institutions Act (22 U.S.C. 
262r(c)(3)); and
    (3) Any successor, subunit, parent entity, or subsidiary of, or any 
entity under common ownership or control with, any entity described in 
paragraph (1) or (2) of this definition.


225.7020-2  Prohibition.

    In accordance with section 890 of the National Defense 
Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), DoD is 
prohibited from entering into a contract for the procurement of 
products or services with any person that has business operations with 
an authority of the government of Venezuela that is not recognized as 
the legitimate government of Venezuela by the U.S. Government, except 
as provided in 225.7020-3 or 225.7020-4.


225.7020-3  Exceptions.

    The prohibition in 225.7020-2 does not apply if--
    (a) The person has a valid license to operate in Venezuela issued 
by the Office of Foreign Assets Control of the Department of the 
Treasury; or
    (b) The acquisition is related to the operation and maintenance of 
the U.S. Government's consular office and diplomatic posts in 
Venezuela.


225.7020-4  Joint determination.

    (a) The prohibition in section 225.7020-2 does not apply to an 
acquisition jointly determined by the Secretary of Defense and 
Secretary of State, without power of redelegation, to be--
    (1) Necessary for purposes of--
    (i) Providing humanitarian assistance to the people of Venezuela;
    (ii) Disaster relief and other urgent lifesaving measures; or
    (iii) Carrying out noncombatant evacuations; or
    (2) Vital to the national security interests of the United States.
    (b) Follow the procedures at PGI 225.7020-4(b) when entering into a 
contract on the basis of a joint determination.


225.7020-5  Solicitation provision and contract clause.

    (a) Use the provision at 252.225-7055, Representation Regarding 
Business Operations with the Maduro Regime, in solicitations, including 
solicitations using FAR part 12 procedures for the acquisition of 
commercial items, that include the clause at 252.225-7056, Prohibition 
Regarding Business Operations with the Maduro Regime.
    (b) Unless the exception at 225.7020-3(b) applies or a joint 
determination has been made in accordance with 225.7020-4, use the 
clause at 252.225-7056, Prohibition Regarding Business Operations with 
the Maduro Regime, in solicitations and contracts, including 
solicitations and contracts using FAR part 12 procedures for the 
acquisition of commercial items.

[[Page 31961]]

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
4. Add section 252.225-7055 to read as follows:


252.225-7055  Representation Regarding Business Operations with the 
Maduro Regime.

    As prescribed in 225.7020-5(a), use the following provision:

Representation Regarding Business Operations With the Maduro Regime 
(May 2022)

    (a) Definitions. As used in this provision--
    Agency or instrumentality of the government of Venezuela, 
business operations, government of Venezuela, and person have the 
meaning given in the clause 252.225-7056, Prohibition Regarding 
Business Operations with the Maduro Regime, of this solicitation.
    (b) Prohibition. In accordance with section 890 of the National 
Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), DoD 
is prohibited from entering into a contract for the procurement of 
products or services with any person that has business operations 
with an authority of the government of Venezuela that is not 
recognized as the legitimate government of Venezuela by the U.S. 
Government, unless the person has a valid license to operate in 
Venezuela issued by the Office of Foreign Assets Control of the 
Department of the Treasury.
    (c) Representation. By submission of its offer, the Offeror 
represents that the Offeror is a person that--
    (1) Does not have any business operations with an authority of 
the Maduro regime or the government of Venezuela that is not 
recognized as the legitimate government of Venezuela by the U.S. 
Government; or
    (2) Has a valid license to operate in Venezuela issued by the 
Office of Foreign Assets Control of the Department of the Treasury.


(End of provision)

0
5. Add section 252.225-7056 to read as follows:


252.225-7056  Prohibition Regarding Business Operations with the Maduro 
Regime.

    As prescribed in 225.7020-5(b), use the following clause:

Prohibition Regarding Business Operations With the Maduro Regime (May 
2022)

    (a) Definitions. As used in this clause--
    Agency or instrumentality of the government of Venezuela means 
an agency or instrumentality of a foreign state as defined in 28 
U.S.C. 1603(b), with each reference in section 1603(b) to a foreign 
state deemed to be a reference to Venezuela.
    Business operations means engaging in commerce in any form, 
including acquiring, developing, maintaining, owning, selling, 
possessing, leasing, or operating equipment, facilities, personnel, 
products, services, personal property, real property, or any other 
apparatus of business or commerce.
    Government of Venezuela means the government of any political 
subdivision of Venezuela, and any agency or instrumentality of the 
government of Venezuela.
    Person means--
    (1) A natural person, corporation, company, business 
association, partnership, society, trust, or any other 
nongovernmental entity, organization, or group;
    (2) Any governmental entity or instrumentality of a government, 
including a multilateral development institution (as defined in 
section 1701(c)(3) of the International Financial Institutions Act 
(22 U.S.C. 262r(c)(3)); and
    (3) Any successor, subunit, parent entity, or subsidiary of, or 
any entity under common ownership or control with, any entity 
described in paragraph (1) or (2) of this definition.
    (b) Prohibition. In accordance with section 890 of the National 
Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), DoD 
is prohibited from entering into a contract for the procurement of 
products or services with any person that has business operations 
with an authority of the government of Venezuela that is not 
recognized as the legitimate government of Venezuela by the U.S. 
Government, unless the person has a valid license to operate in 
Venezuela issued by the Office of Foreign Assets Control of the 
Department of the Treasury.
    (c) The Contractor shall--
    (1) Not have any business operations with an authority of the 
Maduro regime or the government of Venezuela that is not recognized 
as the legitimate government of Venezuela by the U.S. Government; or
    (2) Have a valid license to operate in Venezuela issued by the 
Office of Foreign Assets Control of the Department of the Treasury.
    (d) Subcontracts. The Contractor shall insert the substance of 
this clause, including this paragraph (d), in all subcontracts, 
including subcontracts for the acquisition of commercial items.


(End of clause)

[FR Doc. 2022-11207 Filed 5-25-22; 8:45 am]
BILLING CODE 5001-06-P