73152 Federal Register / Vol. 70, No. 236 / Friday, December 9, 2005 / Rules and Regulations 

information technology contracts from 

the regulatory time limits being 

supplemented by this rule. 

3. Comment: Period of performance 

for certain performance-based contracts. 

One respondent stated that some 

performance-based contracts require 

periods of performance of 15 to 20 years 

to obtain the desired end results and 

questioned how to award these 

contracts given the limits imposed by 

the rule. 

DoD Response: The rule permits 

agencies to authorize longer 

performance periods when deemed 

necessary for exceptional 

circumstances. 

4. Comment: Administrative error. 

One respondent requested clarification 

of the DoD Response to Comment 1 in 

the preamble to the interim rule 

published at 69 FR 74992 on December 

15, 2004. The text contained an 

erroneous reference to DFARS 

217.204(e)(iii) regarding the limit on 

period of performance for task and 

delivery orders. 

DoD Response: Concur that the 

reference was in error. The correct 

reference is DFARS 217.204(e)(iv). 

This rule was not subject to Office of 

Management and Budget review under 

Executive Order 12866, dated 

September 30, 1993. 

B. Regulatory Flexibility Act 

DoD has prepared a final regulatory 

flexibility analysis consistent with 5 

U.S.C. 604. The analysis is summarized 

below. A copy of the analysis may be 

obtained from the point of contact 

specified herein. 

This rule finalizes an interim DFARS 

rule published on December 15, 2004. 

The rule implements Section 843 of the 

National Defense Authorization Act for 

Fiscal Year 2004 (Pub. L. 108–136) and 

Section 813 of the National Defense 

Authorization Act for Fiscal Year 2005 

(Pub. L. 108–375). Section 843 of Public 

Law 108–136 limited the period of a 

task or delivery order contract awarded 

under 10 U.S.C. 2304a to not more than 

5 years. Section 813 of Public Law 108–

375 revised the limitation to not more 

than 10 years, unless the head of the 

agency determines in writing that 

exceptional circumstances require a 

longer contract period. DoD received no 

comments on the initial regulatory 

flexibility analysis. As a result of 

comments received on the interim rule, 

the final rule clarifies the types of 

contracts that are subject to the rule and 

clarifies that the Congressional reporting 

requirement, applicable to contracts 

with ordering periods exceeding 10 

years, expires at the end of fiscal year 

2009. The rule applies to DoD task or 

delivery order contracts awarded under 

the authority of 10 U.S.C. 2304a. It may 

affect businesses interested in receiving 

such contracts. The impact on small 

entities is unknown at this time. 

C. Paperwork Reduction Act 

The Paperwork Reduction Act does 

not apply, because the rule does not 

impose any information collection 

requirements that require the approval 

of the Office of Management and Budget 

under 44 U.S.C. 3501, et seq. 

List of Subjects in 48 CFR Parts 216 and 

217 

Government procurement. 

Michele P. Peterson, 

Editor, Defense Acquisition Regulations 

System. 

■ Accordingly, the interim rule 

amending 48 CFR parts 216 and 217, 

which was published at 69 FR 13478 on 

March 23, 2004, and which was 

amended by the interim rule published 

at 69 FR 74992 on December 15, 2004, 

is adopted as a final rule with the 

following changes: 

■ 1. The authority citation for 48 CFR 

parts 216 and 217 continues to read as 

follows: 

Authority: 41 U.S.C. 421 and 48 CFR 

Chapter 1. 

PART 217—SPECIAL CONTRACTING 

METHODS 

■ 2. Section 217.204 is revised to read 

as follows: 

217.204 Contracts. 

(e)(i) Notwithstanding FAR 17.204(e), 

the ordering period of a task order or 

delivery order contract (including a 

contract for information technology) 

awarded by DoD pursuant to 10 U.S.C. 

2304a—

(A) May be for any period up to 5 

years; 

(B) May be subsequently extended for 

one or more successive periods in 

accordance with an option provided in 

the contract or a modification of the 

contract; and 

(C) Shall not exceed 10 years unless 

the head of the agency determines in 

writing that exceptional circumstances 

require a longer ordering period. 

(ii) DoD must submit a report to 

Congress, annually through fiscal year 

2009, when an ordering period is 

extended beyond 10 years in accordance 

with paragraph (e)(i)(C) of this section. 

Follow the procedures at PGI 217.204(e) 

for reporting requirements. 

(iii) Paragraph (e)(i) of this section 

does not apply to the following: 

(A) Contracts, including task or 

delivery order contracts, awarded under 

other statutory authority. 

(B) Advisory and assistance service 

task order contracts (authorized by 10 

U.S.C. 2304b that are limited by statute 

to 5 years, with the authority to extend 

an additional 6 months (see FAR 

16.505(c)). 

(C) Definite-quantity contracts. 

(D) GSA schedule contracts. 

(E) Multi-agency contracts awarded by 

agencies other than NASA, DoD, or the 

Coast Guard. 

(iv) Obtain approval from the senior 

procurement executive before issuing an 

order against a task or delivery order 

contract subject to paragraph (e)(i) of 

this section, if performance under the 

order is expected to extend more than 

1 year beyond the 10-year limit or 

extended limit described in paragraph 

(e)(i)(C) of this section (see FAR 37.106 

for funding and term of service 

contracts). 

[FR Doc. 05–23732 Filed 12–8–05; 8:45 am] 

BILLING CODE 5001–08–P 

DEPARTMENT OF DEFENSE 

48 CFR Parts 225 and 252 

[DFARS Case 2004–D013] 

Defense Federal Acquisition 

Regulation Supplement; Free Trade 

Agreements—Australia and Morocco 

AGENCY: Department of Defense (DoD). 

ACTION: Final rule. 

SUMMARY: DoD has adopted as final, 

with changes, an interim rule amending 

the Defense Federal Acquisition 

Regulation Supplement (DFARS) to 

implement new Free Trade Agreements 

with Australia and Morocco. The Free 

Trade Agreements were scheduled to 

become effective on or after January 1, 

2005. However, the Morocco Free Trade 

Agreement has not yet entered into force 

and is therefore removed from this final 

rule. 

DATES: Effective Date: December 9, 2005. 

FOR FURTHER INFORMATION CONTACT: Ms. 

Amy Williams, Defense Acquisition 

Regulations System, 

OUSD(AT&L)DPAP(DAR), IMD 3C132, 

3062 Defense Pentagon, Washington, DC 

20301–3062. Telephone (703) 602–0328; 

facsimile (703) 602–0350. Please cite 

DFARS Case 2004–D013. 

SUPPLEMENTARY INFORMATION: 

A. Background 

DoD published an interim rule at 70 

FR 2361 on January 13, 2005, to 

implement new Free Trade Agreements 

Federal Register / Vol. 70, No. 236 / Friday, December 9, 2005 / Rules and Regulations 73153 

with Australia and Morocco, as 

approved by Congress in the United 

States-Australia Free Trade Agreement 

Implementation Act (Public Law 108–

286) and the United States-Morocco 

Free Trade Agreement Implementation 

Act (Public Law 108–302). The Free 

Trade Agreements were scheduled to 

become effective on or after January 1, 

2005. However, the United States Trade 

Representative has informed DoD that 

the Morocco Free Trade Agreement has 

not yet entered into force. Therefore, 

implementation of the Morocco Free 

Trade Agreement is excluded from this 

final rule. In addition, for consistency 

with the Federal Acquisition Regulation 

and other changes made by the interim 

rule, this final rule amends the 

definition of ‘‘eligible product’’ at 

225.003 to include foreign construction 

material. 

This rule was not subject to Office of 

Management and Budget review under 

Executive Order 12866, dated 

September 30, 1993. 

B. Regulatory Flexibility Act 

DoD certifies that this final rule will 

not have a significant economic impact 

on a substantial number of small entities 

within the meaning of the Regulatory 

Flexibility Act, 5 U.S.C. 601, et seq. DoD 

applies the trade agreements to only 

those non-defense items listed at 

DFARS 225.401–70; and acquisitions 

that are set aside for small business 

concerns are exempt from application of 

the trade agreements. 

C. Paperwork Reduction Act 

This rule affects the certification and 

information collection requirements in 

the provisions at DFARS 252.225–7020 

and 252.225–7035, currently approved 

under Office of Management and Budget 

Control Number 0704–0229. The 

impact, however, is negligible. 

List of Subjects in 48 CFR Parts 225 and 

252 

Government procurement. 

Michele P. Peterson, 

Editor, Defense Acquisition Regulations 

System. 

■ Accordingly, the interim rule 

amending 48 CFR parts 225 and 252, 

which was published at 70 FR 2361 on 

January 13, 2005, is adopted as a final 

rule with the following changes: 

■ 1. The authority citation for 48 CFR 

parts 225 and 252 continues to read as 

follows: 

Authority: 41 U.S.C. 421 and 48 CFR 

Chapter 1. 

PART 225—FOREIGN ACQUISITION 

■ 2. Section 225.003 is amended as 

follows: 

■ a. In paragraph (5)(i)(B), by removing 

‘‘or’’; 

■ b. By redesignating paragraph (5)(ii) as 

paragraph (5)(iii); and 

■ c. By adding a new paragraph (5)(ii) to 

read as follows: 

225.003 Definitions. 

* * * * * 

(5) * * * 

(ii) A foreign construction material 

that is not subject to discriminatory 

treatment, due to the applicability of a 

trade agreement to a particular 

acquisition; or 

* * * * * 

PART 252—SOLICITATION 

PROVISIONS AND CONTRACT 

CLAUSES 

252.212–7001 [Amended] 

■ 3. Section 252.212–7001 is amended 

as follows: 

■ a. By revising the clause date to read 

‘‘(DEC 2005)’’; and 

■ b. In paragraph (b), in entry ‘‘252.225–

7021’’, by removing ‘‘(JUN 2005)’’ and 

adding in its place ‘‘(DEC 2005)’’. 

252.225–7021 [Amended] 

■ 4. Section 252.225–7021 is amended 

as follows: 

■ a. By revising the clause date to read 

‘‘(DEC 2005)’’; and 

■ b. In paragraph (a)(3)(ii), by removing 

‘‘Morocco,’’. 

■ 5. Section 252.225–7045 is amended 

as follows: 

■ a. By revising the clause date to read 

‘‘(DEC 2005)’’; 

■ b. In paragraph (a), in the definition of 

‘‘Designated country’’, in paragraph (2), 

by removing ‘‘Morocco,’’; and 

■ c. By revising Alternate I to read as 

follows: 

252.225–7045 Balance of Payments 

Program—Construction Material Under 

Trade Agreements. 

* * * * * 

Alternate I (DEC 2005). As prescribed 

in 225.7503(b), delete the definitions of 

‘‘designated country’’ and ‘‘designated 

country construction material’’ from the 

definitions in paragraph (a) of the basic 

clause, add the following definition of 

‘‘Australian or Chilean construction 

material’’ to paragraph (a) of the basic 

clause, and substitute the following 

paragraphs (b) and (c) for paragraphs (b) 

and (c) of the basic clause: 

Australian or Chilean construction 

material means a construction material 

that—

(1) Is wholly the growth, product, or 

manufacture of Australia or Chile; or 

(2) In the case of a construction 

material that consists in whole or in part 

of materials from another country, has 

been substantially transformed in 

Australia or Chile into a new and 

different construction material distinct 

from the materials from which it was 

transformed. 

(b) This clause implements the 

Balance of Payments Program by 

providing a preference for domestic 

construction material. In addition, the 

Contracting Officer has determined that 

the WTO GPA and all Free Trade 

Agreements except NAFTA apply to this 

acquisition. Therefore, the Balance of 

Payments Program restrictions are 

waived for WTO GPA country, 

Australian or Chilean, least developed 

country, or Caribbean Basin country 

construction material. 

(c) The Contractor shall use only 

domestic, WTO GPA country, 

Australian or Chilean, least developed 

country, or Caribbean Basin country 

construction material in performing this 

contract, except for—

(1) Construction material valued at or 

below the simplified acquisition 

threshold in Part 2 of the Federal 

Acquisition Regulation; or 

(2) The construction material or 

components listed by the Government 

as follows: 

[Contracting Officer to list applicable 

excepted materials or indicate ‘‘none’’] 

[FR Doc. 05–23722 Filed 12–8–05; 8:45 am] 

BILLING CODE 5001–08–P 

DEPARTMENT OF DEFENSE 

48 CFR Parts 225 and 252 

[DFARS Case 2003–D008] 

Defense Federal Acquisition 

Regulation Supplement; Foreign 

Acquisition 

AGENCY: Department of Defense (DoD). 

ACTION: Final rule. 

SUMMARY: DoD has issued a final rule 

amending the Defense Federal 

Acquisition Regulation Supplement 

(DFARS) to update text pertaining to the 

acquisition of supplies and services 

from foreign sources. This rule is a 

result of a transformation initiative 

undertaken by DoD to dramatically 

change the purpose and content of the 

DFARS. 

DATES: Effective Date: December 9, 2005. 

FOR FURTHER INFORMATION CONTACT: Ms. 

Amy Williams, Defense Acquisition 

Regulations System,