06-3685. Federal Acquisition Regulation; FAR Case 2006-001, Free Trade Agreements-Morocco

AGENCIES:

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

ACTION:

Interim rule with request for comments.

SUMMARY:

The Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council (Councils) have agreed on an interim rule amending the Federal Acquisition Regulation (FAR) to implement the new Free Trade Agreement with Morocco as approved by Congress (Public Law 108-302). This Free Trade Agreement went into effect January 1, 2006.

DATES:

Effective Date: April 19, 2006.

Comment Date: Interested parties should submit written comments to the FAR Secretariat on or before June 19, 2006 to be considered in the formulation of a final rule.

ADDRESSES:

Submit comments identified by FAC 2005-09, FAR case 2006-001, by any of the following methods:

• Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments.
• Agency Web Site: http://www.acqnet.gov/​far/​ProposedRules/​proposed.htm. Click on the FAR case number to submit comments.
• E-mail: [e-mail]. Include FAC 2005-09, FAR case 2006-001 in the subject line of the message.
• Fax: [phone].
• Mail: General Services Administration, Regulatory Secretariat (VIR), 1800 F Street, NW., Room 4035, ATTN: Laurieann Duarte, Washington, DC 20405.

Instructions: Please submit comments only and cite FAC 2005-09, FAR case 2006-001, in all correspondence related to this case. All comments received will be posted without change to http://www.acqnet.gov/​far/​ProposedRules/​proposed.htm, including any personal and/or business confidential information provided.

FOR FURTHER INFORMATION CONTACT

For clarification of content, contact Mr. William Clark, Procurement Analyst, at [phone]. Please cite FAC 2005-09, FAR case 2006-001. For information pertaining to status or publication schedules, contact the FAR Secretariat at [phone].

SUPPLEMENTARY INFORMATION:

A. Background

This rule amends FAR Part 25 and the clauses at FAR 52.212-5, Contract Terms and Conditions Required to Implement Statutes or Executive Orders—Commercial Items, FAR 52.225-3, Buy American Act—Free Trade Agreements—Israeli Trade Act, FAR 52.225-5, Trade Agreements, FAR 52.225-11, Buy American Act—Construction Materials under Trade Agreements, and FAR 52.225-12, Notice of Buy American Act Requirement—Construction Materials under Trade Agreements, to implement the new Free Trade Agreement with Morocco, as approved by Congress (Public Law 108-302). This Free Trade Agreement waives the applicability of the Buy American Act for some foreign supplies and construction materials from Morocco, and specifies procurement procedures designed to ensure fairness, applicable to the acquisition of supplies and services.

This is not a significant regulatory action and, therefore, was not subject to review under Section 6(b) of Executive Order 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.

B. Regulatory Flexibility Act

The interim rule is not expected to 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. Although the rule opens up Government procurement to the products of Morocco, the Councils do not anticipate any significant economic impact on U.S. small businesses. The Department of Defense only applies the trade agreements to the non-defense items listed at DFARS 225.401-70, and acquisitions that are set aside for small businesses are exempt. Therefore, an Initial Regulatory Flexibility Analysis has not been performed. The Councils will consider comments from small entities concerning the affected FAR Parts 25 and 52 in accordance with 5 U.S.C. 610.

Interested parties must submit such comments separately and cite 5 U.S.C. 601, et seq. (FAC 2005-09, FAR case 2006-001), in correspondence.

C. Paperwork Reduction Act

The Paperwork Reduction Act does apply; however, these changes to the FAR do not impose additional information collection requirements to the paperwork burden previously approved under OMB Control Numbers 9000-0025 and 9000-0141.

D. Determination to Issue an Interim Rule

A determination has been made under the authority of the Secretary of Defense (DoD), the Administrator of General Services (GSA), and the Administrator of the National Aeronautics and Space Administration (NASA) that urgent and compelling reasons exist to promulgate this interim rule without prior opportunity for public comment. This action is necessary because the Free Trade Agreement with Morocco, as approved by Congress (Public Law 108-302), went into effect January 1, 2006. However, pursuant to Public Law 98-577 and FAR 1.501, the Councils will consider public comments received in response to this interim rule in the formation of the final rule.

List of Subjects in 48 CFR Parts 25 and 52

• Government procurement

Dated: April 12, 2006.

Gerald Zaffos,

Director, Contract Policy Division.

Therefore, DoD, GSA, and NASA amend 48 CFR parts 25 and 52 as set forth below:

1. The authority citation for 48 CFR parts 25 and 52 continues to read as follows:

Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42 U.S.C. 2473(c).

PART 25—FOREIGN ACQUISITION

25.003

[Amended]

2. Amend section 25.003, in paragraph (2) of the definition “Designated country” and the definition “Free Trade Agreement country” by adding “Morocco,” after “Mexico,”.

3. Amend section 25.400 by—

a. Removing from the end of paragraph (a)(2)(iii) the word “and”;

b. Adding in paragraph (a)(2)(iv) the word “and” at the end of the paragraph; and

c. Adding a new paragraph (a)(2)(v) to read as follows:

25.400

Scope of Subpart.

(a) * * *

(2) * * *

(v) Morocco FTA (The United States—Morocco Free Trade Agreement, as approved by Congress in the United States—Morocco Free Trade Agreement Implementation Act (Pub. L. 108-302));

* * * * *

25.401

[Amended]

4. Amend section 25.401 in paragraph (b), in the table heading, by removing from the fifth column the text “Australia FTA” and adding “Australia and Morocco FTA” in its place.

5. Amend section 25.402 by revising the table following paragraph (b) to read as follows:

25.402

General.

* * * * *

(b) * * *

Trade Agreement	Supply Contract (equal to or exceeding)	Service Contract (equal to or exceeding)	Construction Contract (equal to or exceeding)
WTO GPA	$193,000	$193,000	$7,407,000
FTAs
Australia FTA	64,786	64,786	7,407,000
Chile FTA	64,786	64,786	7,407,000
Morocco FTA	193,000	193,000	7,407,000
NAFTA
-Canada	25,000	64,786	8,422,165
-Mexico	64,786	64,786	8,422,165
Singapore FTA	64,786	64,786	7,407,000
Israeli Trade Act	$50,000	-	-

6. Amend section 25.1102 by revising the second sentence of paragraph (c)(3) to read as follows:

25.1102

Acquisition of construction.

* * * * *

(c) * * *

(3) * * * List in paragraph (b)(3) of the clause all foreign construction material excepted from the requirements of the Buy American Act, unless the excepted foreign construction material is from a designated country other than Mexico.

* * * * *

PART 52—SOLICITATION PROVISIONS AND CONTRACT CLAUSES

52.212-5

[Amended]

7. Amend section 52.212-5 by revising the date of the clause to read “(APR 2006)”; and by removing from paragraphs (b)(24)(i) and (b)(25) “(JAN 2006)” and adding “(APR 2006)” in its place.

52.225-3

[Amended]

8. Amend section 52.225-3 by revising the date of the clause to read “(APR 2006)”; and in paragraph (c) by adding to the first sentence “(except the Morocco FTA)” after “FTAs”.

52.225-5

[Amended]

9. Amend section 52.225-5 by revising the date of the clause to read “(APR 2006)”; and in paragraph (a), in the definition “Designated country” by adding to paragraph (2) “Morocco,” after “Mexico,”.

52.225-11

[Amended]

10. Amend section 52.225-11 by—

a. Revising the date of the clause;

b. Adding to paragraph (a), in the definition “Designated country” in paragraph (2) “Morocco,” after “Mexico,”;

c. Removing from paragraph (b)(2) “domestic,” and adding “domestic or” in its place.

d. Amending Alternate I by—

1. Revising the date of Alternate I;

2. Removing from the introductory paragraph “Australian or Chilean” and adding “Australian, Chilean, or Moroccan” in its place;

3. Revising the definition “Australian or Chilean construction material”; and

4. Removing from paragraphs (b)(1) and (b)(2) “Australian or Chilean” and adding “Australian, Chilean, or Moroccan” in its place.

The revised text reads as follows:

52.225-11

Buy American Act—Construction Materials under Trade Agreements.

* * * * *

BUY AMERICAN ACT—CONSTRUCTION MATERIALS UNDER TRADE AGREEMENTS “(APR 2006)”

* * * * *

Alternate I “(APR 2006)”. * * *

Australian, Chilean, or Moroccan construction material means a construction material that—

(1) Is wholly the growth, product, or manufacture of Australia, Chile, or Morocco; 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, Chile, or Morocco into a new and different construction material distinct from the materials from which it was transformed.

* * * * *

52.225-12

[Amended]

11. Amend section 52.225-12 by revising the date of Alternate II to read “(APR 2006)”; and by removing from paragraphs (a), (d)(1) twice, and (d)(3) twice “Australian or Chilean” and adding “Australian, Chilean, or Moroccan” in its place.