00-10132. Federal Acquisition Regulation; Determination of Price Reasonableness and Commerciality

AGENCIES:

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

ACTION:

Final rule.

SUMMARY:

The Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council (Councils) have agreed on a final rule amending the Federal Acquisition Regulation (FAR) to implement Sections 803 and 808 of the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999 (Pub. L. 105-261).

DATES:

Effective Date: April 25, 2000.

Applicability Date: The FAR, as amended by this rule, is applicable to solicitations issued on or after April 25, 2000.

FOR FURTHER INFORMATION CONTACT:

The FAR Secretariat, Room 4035, GS Building, Washington, DC, 20405, [phone], for information pertaining to status or publication schedules. For clarification of content, contact Mr. Jeremy Olson at [phone]. Please cite FAC 97-17, FAR case 1998-300.

SUPPLEMENTARY INFORMATION:

A. Background

The Councils initiated this case to implement Sections 803 and 808 of the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999 (Pub. L. 105-261) as follows:

(a) Section 803 of Public Law 105-261. (1) Paragraphs (a)(2)(A) through (a)(2)(C) of Section 803 of Pub. L. 105-261 require that the FAR provide specific guidance concerning—

(i) The appropriate application and precedence of various price analysis tools;

(ii) The circumstances under which contracting officers should require offerors of exempt commercial items to provide information other than cost or pricing data; and

(iii) The role and responsibility of support organizations in determining price reasonableness.

(2) Paragraph (a)(2)(D) of Section 803 is not implemented under this case.

(b) Section 808 of Public Law 105-261. Section 808 of Public Law 105-261 requires amending the FAR to—

(1) Clarify procedures associated with obtaining information other than cost or pricing data;

(2) Establish that offerors who fail to comply with requirements to provide the information shall be ineligible for award; and

(3) Establish exceptions, as appropriate.

The Councils published an interim rule in the Federal Register on September 24, 1999 (64 FR 51828). Five respondents submitted comments in response to the interim rule. The Councils considered all comments in the development of the final rule.

This rule was not subject to Office of Management and Budget 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 Councils prepared a Final Regulatory Flexibility Analysis (FRFA) consistent with 5 U.S.C. 604. Interested parties may obtain a copy of the FRFA from the FAR Secretariat. The FRFA is summarized as follows:

The primary objective of this rule is to provide guidance on determining price reasonableness and commerciality, and to specify that offerors failing to comply with a requirement to provide certain information other than cost or pricing data are ineligible for award. There were no issues raised by the public in response to the Initial Regulatory Flexibility Analysis. The rule will apply to all offerors, large or small, that respond to solicitations for commercial items for which information other than cost or pricing data is required. Few, if any, offerors are expected to fail to comply with the requirements to provide information other than cost or pricing data. The rule does not impose any new reporting or recordkeeping requirements. There are no significant alternatives to the rule that would accomplish the stated objectives yet further reduce impact on small entities. The rule includes only FAR text revisions required to implement the statute cited herein.

The FAR Secretariat has submitted a copy of the FRFA to the Chief Counsel for Advocacy of the Small Business Administration.

C. Paperwork Reduction Act

The Paperwork Reduction Act does not apply because the changes to the FAR do not impose 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 12, 13, and 15

• Government procurement

Dated: April 13, 2000.

Edward C. Loeb,

Director, Federal Acquisition Policy Division.

Interim Rule Adopted as Final With Change

Accordingly, DoD, GSA, and NASA adopt the interim rule amending 48 CFR parts 12, 13, and 15, which was published in the Federal Register on September 24, 1999 (64 FR 51828), as a final rule with the following change:

PART 15—CONTRACTING BY NEGOTIATION

1. The authority citation for 48 CFR parts 12, 13, and 15 continues to read as follows:

Authority: 40 U.S.C. 486(c); 10 U.S.C. chapter 137; and 42 U.S.C. 2473(c).

15.403-3

[Amended]

2. Amend section 15.403-3 at the end of paragraph (c)(1) by removing “(see 15.403-3(a)(1))” and adding “(see 15.404-1)” in its place.