Rule2022-04011
Defense Federal Acquisition Regulation Supplement: Exception to Competition for Certain Follow-On Production Contracts (DFARS Case 2019-D031)
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
February 28, 2022
Effective
February 28, 2022
Issuing agencies
Defense DepartmentDefense Acquisition Regulations System
Abstract
DoD is issuing a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to implement a section of the National Defense Authorization Act for Fiscal Year 2016 that modifies the criteria required to exempt from competition certain follow-on production contracts.
Full Text
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<title>Federal Register, Volume 87 Issue 39 (Monday, February 28, 2022)</title>
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[Federal Register Volume 87, Number 39 (Monday, February 28, 2022)]
[Rules and Regulations]
[Pages 10989-10990]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-04011]
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DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System
48 CFR Part 206
[Docket DARS-2019-0051]
RIN 0750-AK67
Defense Federal Acquisition Regulation Supplement: Exception to
Competition for Certain Follow-On Production Contracts (DFARS Case
2019-D031)
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 section of the
National Defense Authorization Act for Fiscal Year 2016 that modifies
the criteria required to exempt from competition certain follow-on
production contracts.
DATES: Effective February 28, 2022.
FOR FURTHER INFORMATION CONTACT: Ms. Kimberly R. Ziegler, telephone
571-372-6095.
SUPPLEMENTARY INFORMATION:
I. Background
DoD published a proposed rule in the Federal Register at 84 FR
50811 on September 26, 2019, to amend DFARS 206.001 to implement
section 815 of the National Defense Authorization Act (NDAA) for Fiscal
Year (FY) 2016 (Pub. L. 114-92). Section 815 repeals and replaces
section 845 of the NDAA for FY 1994 (Pub. L. 103-160; 10 U.S.C. 2371
note) with 10 U.S.C. 2371b, which modifies the authority of DoD to
carry out other transaction (OT) agreements for prototype projects, as
well as the criteria required to award an associated follow-on
production contract to the participants in the other transaction
agreement without the use of competitive procedures. One respondent
submitted comments on the proposed rule.
II. Discussion and Analysis
A. Summary of Significant Changes
The purpose of this rule is to provide contracting officers with
updated internal guidance when awarding a follow-on production contract
that is exempt from the competitive procedures of Federal Acquisition
Regulation part 6, as set forth in 10 U.S.C. 2371b. The rule is not
intended to implement policy, regulation, or guidance on DoD's
authority to enter into OT prototype agreements at 10 U.S.C. 2371b. As
such, this final rule changes the rule text to specify that the
agreements officer for the OT agreement for the prototype project is
responsible for providing to the contracting officer information that
confirms the requirements to award a noncompetitive follow-on
production contract, as specified in 10 U.S.C. 2371b and DoD OT
agreement policy, have been met.
B. Analysis of Public Comments
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:
Comment: The respondent advised that DoD should provide clear
guidance on what constitutes ``successful completion'' of a prototype
transaction; the rule text should be clarified to explain what it means
to award a follow-on production contract to ``the participants in the
transaction,'' as contracts are usually made between the Government and
a single entity; the rule should clarify what a ``participant'' is,
given that not all parties to a transaction necessarily participate in
the project.
The respondent also advised that the rule should be revised to
clarify the prerequisites for awarding the OT for the prototype project
and the prerequisites for awarding a follow-on production contract.
Specifically, one of the criteria for awarding a follow-on production
contract is that the OT for the prototype project is based on specific
determinations made by certain acquisition officials according to
different threshold values. The proposed rule, however, applies these
determination requirements only to the follow-on production contract,
when they should instead apply only to the initial OT agreement.
Response: This rule is not intended to implement policy,
regulation, or guidance on DoD's authority to enter into OT prototype
agreements at 10 U.S.C. 2371b. Instead, the Office of the Under
Secretary of Defense for Acquisition and Sustainment (OUSD(A&S)) is the
organization responsible for promulgation of policy for OT agreements,
which can be viewed at <a href="https://aaf.dau.edu/aaf/ot-guide/">https://aaf.dau.edu/aaf/ot-guide/</a>. As a result,
this rule is modified to clarify that the contracting officer does not
make the determination that the prototype project was successfully
completed and, instead, should receive that information from the
agreements officer for the OT agreement.
Comment: The respondent advised that 32 CFR part 3 should be
updated to reflect the current authority at 10 U.S.C. 2371b.
Response: This comment is outside the scope of this rule, which
amends 48 CFR chapter 2.
C. Other Changes
The proposed numbering of the DFARS text is redesignated as DFARS
206.001-70 from 206.001(S-70) to align with FAR system drafting
conventions.
III. Applicability to Contracts at or Below the Simplified Acquisition
Threshold, for Commercial Products Including Commercially Available
Off-the-Shelf Items, and for Commercial Services
This rule only impacts the internal operating procedures of the
agency. The rule does not impose any new requirements on contracts at
or below
[[Page 10990]]
the simplified acquisition threshold, for commercial products including
commercially available off-the-shelf items, or for commercial services.
IV. Executive Orders 12866 and 13563
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.
V. 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.
VI. 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 Department of Defense is amending the Defense Federal
Acquisition Regulation Supplement (DFARS) to implement section 815 of
the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2016
(Pub. L. 114-92), which repeals and replaces section 845 of the NDAA
for FY 1994 (Pub. L. 103-160; 10 U.S.C. 2371 note) with 10 U.S.C.
2371b.
The objective of this rule is to provide contracting officers with
updated internal guidance when awarding a follow-on production contract
that is exempt from the competitive procedures of Federal Acquisition
Regulation part 6, as set forth in 10 U.S.C. 2371b.
No public comments were received in response to the initial
regulatory flexibility analysis.
DoD does not collect data on the number of follow-on production
contracts that are awarded annually and associated with a prototype
project transaction agreement made under the authority of 10 U.S.C.
2371b; therefore, DoD is unable to estimate the number of small
entities that will be impacted by this rule. However, DoD does not
expect small entities to be significantly impacted by this rule,
because the rule does not change any existing processes or impose any
additional burdens. Instead, the rule simply clarifies instructions to
contracting officers on the criteria that must be met in order to award
an associated follow-on production contract without using competitive
procedures.
This rule does not include any new reporting, recordkeeping, or
other compliance requirements for small entities. This rule does not
duplicate, overlap, or conflict with any other Federal rules. There are
no known alternative approaches to the rule that would meet the stated
objectives.
VII. Paperwork Reduction Act
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).
List of Subjects in 48 CFR Part 206
Government procurement.
Jennifer D. Johnson,
Editor/Publisher, Defense Acquisition Regulations System.
Therefore, 48 CFR part 206 is amended as follows:
PART 206--COMPETITION REQUIREMENTS
0
1. The authority citation for 48 CFR part 206 continues to read as
follows:
Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.
206.001 [Amended]
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2. Amend section 206.001 by removing paragraph (S-70).
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3. Add section 206.001-70 to read as follows:
206.001-70 Exception for prototype projects for follow-on production
contracts.
(a) Also excepted from this part are follow-on production contracts
for products developed pursuant to the ``other transactions'' authority
of 10 U.S.C. 2371b for prototype projects when--
(1) The other transaction solicitation and agreement included
provisions for a follow-on production contract; and
(2) The contracting officer receives sufficient documentation from
the agreements officer of the other transaction agreement for the
prototype project that the requirements of 10 U.S.C. 2371b sections
(f)(2)(A) and (B) and, when applicable, section (a)(2), have been met.
(b) See PGI 206.001-70(b) for additional guidance.
[FR Doc. 2022-04011 Filed 2-25-22; 8:45 am]
BILLING CODE 5001-06-P
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</html>Indexed from Federal Register on February 28, 2022.
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