95-30995. Federal Acquisition Regulation; Contractors' Purchasing Systems Reviews

[Federal Register Volume 60, Number 245 (Thursday, December 21, 1995)]
[Proposed Rules]
[Pages 66472-66473]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-30995]



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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Part 44

[FAR Case 94-605]
[RIN 9000-AG75]


Federal Acquisition Regulation; Contractors' Purchasing Systems 
Reviews

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

ACTION: Proposed rule.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council (Councils) are proposing a revision to 
the Federal Acquisition Regulation (FAR) concerning requirements under 
Contractors' Purchasing Systems Reviews (CPSR's). This regulatory 
action was not subject to Office of Management and Budget review under 

[[Page 66473]]
Executive Order 12866, dated September 30, 1993.

DATES: Comments should be submitted on or before February 20, 1996 to 
be considered in the formulation of a final rule.

ADDRESSES: Interested parties should submit written comments to: 
General Services Administration, FAR Secretariat (VRS), 18th & F 
Streets, NW., Room 4037, Washington, DC 20405.
    Please cite FAR case 94-605 in all correspondence related to this 
case.

FOR FURTHER INFORMATION CONTACT:
Ms. Linda Klein at [phone] in reference to this FAR case. For 
general information, contact the FAR Secretariat, Room 4037, GS 
Building, Washington, DC 20405 [phone]. Please cite FAR case 94-
605.

SUPPLEMENTARY INFORMATION:

A. Background

    Concern has been expressed that FAR 44.302(a) includes contractors 
in the CPSR process that will be severely inconvenienced by the review, 
and allows for the review of systems even when there is no benefit to 
the Government. Under the current FAR 44.302, a CPSR is to be conducted 
for each contractor whose sales to the Government are expected to 
exceed $10 million during the next 12 months. However, the Councils 
have agreed to raise the $10 million threshold to $25 million and have 
determined that contractors meeting the $25 million threshold should be 
reviewed before conducting a CPSR, to decide if a CPSR is necessary. 
The increased thresholds ($10 million to $25 million) that are 
reflected in this proposed rule have previously been approved under FAR 
case 94-40, Contractors' Purchasing Systems Reviews and Subcontractor 
Consent, and is awaiting publication as a final rule. The need for a 
CPSR will be determined based on volume, complexity, and dollar value 
of subcontracting activity. The proposed revision is intended to 
prevent unwarranted CPSR's from being conducted.

B. Regulatory Flexibility Act

    This proposed 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., because the rule 
will reduce the number of CPSR's being conducted by requiring a review 
to determine if a CPSR is needed. An Initial Regulatory Flexibility 
Analysis has, therefore, not been performed. Comments from small 
entities concerning the affected FAR subpart will be considered in 
accordance with 5 U.S.C. 610 of the Act. Such comments must be 
submitted separately and should cite 5 U.S.C. 601, et seq. (FAR case 
94-605), in correspondence.

C. Paperwork Reduction Act

    The information collection requirements for CPSR's have been 
previously approved under Office of Management and Budget Number 9000-
0132. This proposed rule does not contain any increased information 
collection requirements.

List of Subjects in 48 CFR Part 44

    Government procurement.

    Dated: December 15, 1995.
Edward C. Loeb,
Acting Director, Office of Federal Acquisition Policy.

    Therefore, it is proposed that 48 CFR Part 44 be amended as set 
forth below:

PART 44--SUBCONTRACTING POLICIES AND PROCEDURES

    1. The authority citation for 48 CFR Part 44 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).

    2. Section 44.302 is revised to read as follows:


Sec. 44.302  Requirements.

    (a) Each contractor whose sales to the Government, using other than 
sealed bid procedures, are expected to exceed $25 million during the 
next 12 months, shall be reviewed to determine if Contractors' 
Purchasing Systems Review (CPSR) is needed. Such sales include those 
represented by prime contracts, subcontracts under Government prime 
contracts, and modifications. The need for a CPSR will be determined 
based on volume, complexity, and dollar value of subcontracting 
activity. Generally, a CPSR is not performed for a specific contract. 
The head of the agency responsible for contract administration may 
raise or lower the $25 million review level if such action is 
considered to be in the Government's best interest.
    (b) Once an initial determination has been made under paragraph (a) 
of this section, at least every 3 years the cognizant contract 
administration activity will either: conduct a follow-up purchasing 
review; or determine that a purchasing system review is not required 
based on volume, complexity, and dollar value of subcontracting 
activity.

[FR Doc. 95-30995 Filed 12-20-95; 8:45 am]
BILLING CODE 6820-EP-M