[Federal Register Volume 60, Number 249 (Thursday, December 28, 1995)]
[Proposed Rules]
[Pages 67115-67116]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-31336]



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DEPARTMENT OF DEFENSE
48 CFR Parts 225 and 252


Defense Federal Acquisition Regulation Supplement; Foreign 
Product Restrictions

AGENCY: Department of Defense (DoD).

ACTION: Proposed rule with request for comment.

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SUMMARY: The Director of Defense Procurement is proposing to amend the 
Defense Federal Acquisition Regulation Supplement (DFARS) to rescind 
most of the non-statutory foreign product restrictions in subpart 
225.71.

DATES: Comment Date: Comments on the proposed rule should be submitted 
in writing to the address below on or before February 26, 1996, to be 
considered in the formulation of the final rule.

ADDRESSES: Interested parties should submit written comments to: 
Defense Acquisition Regulations Council, Attn: Ms. Amy Williams, PDUSD 
(A&T) DP (DAR), IMD 3D139, 3062 Defense Pentagon, Washington, D.C. 
20301-3062. Telefax number (703) 602-0350. Please cite DFARS Case 95-
D033 in all correspondence related to this issue.

FOR FURTHER INFORMATION CONTACT:
Ms. Amy Williams, (703) 602-0131.

SUPPLEMENTARY INFORMATION:

A. Background

    This proposed rule amends language in the Defense Federal 
Acquisition Regulation Supplement (DFARS) to rescind most of the non-
statutory foreign product restrictions in Subpart 225.71, except for 
the restrictions on several forging items, which are still under 
review.

B. Regulatory Flexibility Act

    The proposed rule may 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., because the proposed 
rule will affect the preference for domestic manufacturers of miniature 
and instrument ball bearings, precision components for certain 
mechanical time devices, high purity silicon, high carbon ferrochrome, 
and certain foreign items. It is estimated that approximately 135 
contractors, some of which are small businesses, will now be subject to 
foreign competition. An Initial Regulatory Flexibility Analysis has 
been prepared and may be obtained from the address stated herein. 
Comments are invited from small businesses and other interested 
parties. Comments from small entities concerning the affected DFARS 
subparts will be considered in accordance with Section 610 of the Act. 
Such comments must be submitted separately and cite DFARS Case 95-D033 
in correspondence.

C. Paperwork Reduction Act

    Because many items are no longer restricted, the proposed rule will 
result in a reduction of the paperwork burden associated with DFARS 
clause 252.225-7025, Foreign Source Restrictions (OMB Control No. 0704-
0229), which requires that contractors maintain records showing 
compliance with the restrictions until three years after final payment 
and make records available upon request of the Contracting Officer. The 
rule does not impose any additional information collection requirements 
which 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 225 and 252

    Government procurement.
Michele P. Peterson,
Executive Editor, Defense Acquisition Regulations Council.
    Therefore, 48 CFR Parts 225 and 252 are proposed to be amended as 
follows:

PART 225--FOREIGN ACQUISITION

    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.

    2. Section 225.7102 is revised to read as follows:


225.7102  Forgings policy.

    DoD requirements for the following forging items, whether as end 
items or components, shall be acquired from U.S. or Canadian sources to 
the maximum extent practicable--

------------------------------------------------------------------------
                   Items                             Categories         
------------------------------------------------------------------------
Ship propulsion shafts....................  Excludes service and landing
                                             craft shafts.              
Periscope tubes...........................  All.                        
Ring forgings for bull gears..............  All greater than 120 inches 
                                             in diameter.               
------------------------------------------------------------------------

    3. Section 225.7103 is revised to read as follows:


225.7103  Forgings exceptions.

    The policy in 225.7102 does not apply to acquisitions--
    (a) When using simplified acquisition procedures, unless the 
restricted item is the end item being purchased:
    (b) Overseas for overseas use; or
    (c) When the quantity acquired exceeds the amount needed to 
maintain the U.S. defense mobilization base (provided such quantity is 
an economical purchase quantity). The restriction to domestic sources 
does not apply to the quantity above that required to maintain the 
base, in which case, qualifying country sources may compete.
    4. Section 225.7104 is revised to read as follows:


225.7104  Forgings waivers.

    Upon request from a prime contractor, the contracting officer may 
waive the requirement for domestic manufacture of the items covered by 
the policy in 225.7102.

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    5. Section 252.225-7105, is revised to read as follows:


252.225-7025  Foreign Source Restrictions.

    As prescribed in 225.7105, use the following clause:

Foreign Source Restrictions (XXX XXXX)

    (a) Definitions. As used in this clause--
    (1) ``Domestic manufacture'' means manufactured in the United 
States or Canada if the Canadian firm--
    (i) Normally produces similar items or is currently producing 
the item in support of DoD contracts (as prime or subcontractor); 
and
    (ii) Agrees to become (upon receiving a contract/order) a 
planned producer under 

[[Page 67116]]
DoD's Industrial Preparedness Program, if it is not already a planned 
producer for the item.
    (2) ``Forging items'' means--

------------------------------------------------------------------------
                   Items                             Categories         
------------------------------------------------------------------------
Ship propulsion shafts....................  Excludes service and landing
                                             craft shafts.              
Periscope tubes...........................  All.                        
Ring forgings for bull gears..............  All greater than 120 inches 
                                             in diameter.               
------------------------------------------------------------------------

    (b) The Contractor agrees that end items and their components 
delivered under this contract shall contain forging items that are 
of domestic manufacture only.
    (c) The restrictions in paragraph (b) of this clause may be 
waived upon request from the Contractor in accordance with section 
225.7104 of the Defense FAR Supplement.
    (d) The Contractor agrees to retain records showing compliance 
with this restriction until three years after final payment and to 
make records available upon request of the Contracting Officer.
    (e) The Contractor agrees to insert this clause, including this 
paragraph (e), in subcontracts and purchase orders issued in 
performance of this contract, when products purchased contain 
restricted forging items.
(End of clause)

[FR Doc. 95-31336 Filed 12-27-95; 8:45 am]
BILLING CODE 5000-04-M