[Federal Register Volume 72, Number 177 (Thursday, September 13, 2007)]
[Rules and Regulations]
[Pages 52293-52299]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-18039]
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DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System
48 CFR Parts 211, 245, and 252
RIN 0750-AF24
Defense Federal Acquisition Regulation Supplement; Reports of
Government Property (DFARS Case 2005-D015)
AGENCY: Defense Acquisition Regulations System, Department of Defense
(DoD).
ACTION: Interim rule with request for comments.
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SUMMARY: DoD has issued an interim rule amending the Defense Federal
Acquisition Regulation Supplement (DFARS) to revise requirements for
reporting of Government property in the possession of DoD contractors.
The rule replaces existing DD Form 1662 reporting requirements with
requirements for DoD contractors to electronically submit, to the Item
Unique Identification (IUID) Registry, the IUID data applicable to the
Government property in the contractor's possession. This will result in
more efficient and accurate reporting of Government property in the
possession of contractors.
DATES: Effective date: September 13, 2007.
Comment date: Comments on the interim rule should be submitted to
the address shown below on or before November 13, 2007, to be
considered in the formation of the final rule.
ADDRESSES: You may submit comments, identified by DFARS Case 2005-D015,
using any of the following methods:
[cir] Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
[cir] E-mail: [email protected]. Include DFARS Case 2005-D015 in the
subject line of the message.
[cir] Fax: (703) 602-7887.
[cir] Mail: Defense Acquisition Regulations System, Attn: Mr.
Michael Benavides, OUSD (AT&L) DPAP (DARS), IMD 3D139, 3062 Defense
Pentagon, Washington, DC 20301-3062.
[cir] Hand Delivery/Courier: Defense Acquisition Regulations
System, Crystal Square 4, Suite 200A, 241 18th Street, Arlington, VA
22202-3402.
Comments received generally will be posted without change to http://www.regulations.gov, including any personal information provided.
[[Page 52294]]
FOR FURTHER INFORMATION CONTACT: Mr. Michael Benavides, (703) 602-1302.
SUPPLEMENTARY INFORMATION:
A. Background
The clause at DFARS 252.245-7001 requires contractors to submit an
annual report for all DoD property for which the contractor is
accountable. The report must be prepared in accordance with the
requirements of DD Form 1662 or an approved substitute. DD Form 1662
provides for reporting of only summary level totals for each of the
various types of Government property (e.g., special test equipment,
industrial plant equipment), and does not consider capitalization
requirements or useful lives, nor can it be used for existence,
completeness, or valuation purposes. The limited data produced through
use of DD Form 1662 is considered to be insufficient for complete
visibility and control of DoD property.
This interim rule replaces DD Form 1662 reporting with requirements
for contractors to electronically submit, to the Item Unique
Identification (IUID) Registry, the IUID data for DoD tangible personal
property in the possession of the contractor. Policy is added at DFARS
211.274-4, with a corresponding contract clause at 252.211-7007, to
specify IUID requirements for reporting of Government property. This
data will be used to populate DoD information systems for more
effective and efficient accountability and control of DoD property.
In accordance with the convention at FAR 1.108(d), the IUID
reporting requirements will apply to contracts resulting from
solicitations issued on or after the effective date of this interim
rule. However, DoD contractors with existing contracts containing DD
Form 1662 reporting requirements are encouraged to request contract
modifications to designate use of the procedures specified in this
interim rule as the approved substitute for DD Form 1662, as permitted
by the clause at DFARS 252.245-7001. The rule does not apply to:
Property under any statutory leasing authority; property to which the
Government has acquired a lien or title solely because of partial,
advance, progress, or performance-based payments; software and
intellectual property; or real property.
DoD published a proposed rule at 71 FR 14151 on March 21, 2006.
Seventeen sources submitted comments on the proposed rule. As a result
of these comments, the interim rule contains additional changes that:
Clarify the definition of ``equipment'' and the types of property that
must be reported in the IUID Registry; exclude items under $5,000 from
reporting unless otherwise specified in the contract; and provide more
specific procedures regarding data submission. In addition, the clause
prescription has been moved to DFARS Part 211, to permit collocation of
item identification and valuation requirements applicable to Government
property and delivered items. A discussion of the public comments is
provided below.
1. Comment: Five respondents requested that issuance of this rule
be postponed until publication of the final rule amending the
Government property requirements of FAR Part 45 (FAR Case 2004-0025),
to ensure the definitions in both rules are consistent (e.g.,
equipment, personal property, material).
DoD Response: The final rule revising FAR Part 45 was published on
May 15, 2007 (72 FR 27364). The definitions in this DFARS rule have
been revised, where appropriate, to align with the FAR Part 45
definitions.
2. Comment: One respondent requested definition of ``reasonable
inventory adjustments'' as the term is used in 252.245-7001(c)(2).
DoD Response: This interim rule does not use the term ``reasonable
inventory adjustments.'' Therefore, the term is not defined in the
rule. However, ``inventory adjustments'' are changes made to the
official accountability record when physical counts and official
records do not agree. All such changes require specific approval and
documentation to support the adjustment, normally to include results of
reconciliation efforts to determine and resolve the cause of such
disagreement.
3. Comment: One respondent requested that the rule include
definitions of ``real property'' and ``reportable property'' with
regard to property in the possession of the contractor (PIPC).
DoD Response: PIPC does not include real property, and real
property is excluded from IUID reporting requirements. PIPC includes
only tangible ``personal'' property in the custody of the contractor.
Further, the level of reporting varies for different classes of PIPC
and, therefore, a single definition for ``reportable property'' might
be misleading. PIPC is meant to distinguish tangible personal property
in the custody of contractors from all Government property that is
owned or leased by the Government.
4. Comment: One respondent commented that, under various FAR 52.245
clauses, contractors are the custodians of Government property in their
possession and fiduciary owners of the associated property records, and
that requiring contractors to transmit detailed back-up data on the
Government property in their possession changes this relationship and
imposes new financial reporting requirements on organizational groups
better suited to maintaining the accountability of property.
DoD Response: The Government-furnished property IUID requirements
do not alter the underlying principle of the FAR clauses, that the
contractor remains the custodian or ``steward'' of the Government's
property. Also, the IUID reporting requirements do not impose any
financial reporting or accounting activities of Government assets on
contractors. Fiduciary responsibility is always with the Government.
5. Comment: Three respondents expressed concern that the rule
places a financial burden on both Government agencies and contractors
without providing a plan for funding to agencies to implement the rule,
including implementation costs for Government property already in the
possession of contractors. In addition, it was stated that the
provisions do not address the engineering and technical aspects of
marking the items, yet there may be substantial inventories of items at
certain contractors' facilities, and changing the technical data for
all the items may take more time and money.
DoD Response: The provisions of this rule are not retroactive and,
therefore, will not be applicable to property already in the possession
of contractors. Existing contracts containing DD Form 1662 reporting
requirements are not subject to the requirements of this rule unless
the contractor voluntarily elects to transition to IUID reporting
requirements.
6. Comment: Two respondents recommended that the prescription for
the clause acknowledge that contracts in place prior to this clause
revision are not subject to the reporting change.
DoD Response: In accordance with the convention at FAR 1.108(d),
FAR and DFARS changes apply to solicitations issued on or after the
effective date of the change unless otherwise specified. Therefore, no
additional language regarding applicability is needed for this rule to
address existing contracts.
7. Comment: One respondent commented that the rule has some serious
deficiencies in content and clarity that need to be resolved to allow
DoD to achieve a new level of fiduciary accounting accuracy, and
recommended postponing the issuance of this rule until the FAR Part 45
rewrite is issued,
[[Page 52295]]
as this rule is a subset of the larger and more comprehensive Part 45
rewrite.
DoD Response: DoD cannot achieve greater fiscal accountability
unless it implements a solution that captures additional data for
Government property in the possession of contractors. As stated in the
DoD response to Comment 1 above, the FAR Part 45 final rule was
published on May 15, 2007 (72 FR 27364).
8. Comment: Several respondents requested that a dollar threshold
be established for reporting that does not require recording of low-
value items in the IUID Registry. In addition, it was suggested that
contractor-acquired property be excluded from the reporting requirement
to be consistent with various DoD instructions and guidance previously
provided to contractors.
DoD Response: DoD has revised the rule to exclude items valued
below $5,000 from the IUID Registry, unless otherwise specified in the
contract clause at 252.211-7007. The rule also clarifies that
contractor-acquired property is excluded from reporting requirements.
9. Comment: One respondent requested clarification as to whether DD
Form 1662 reporting will be required for Government property that has
not been marked.
DoD Response: DD Form 1662 reporting will not be required. The
reporting (annually via DD Form 1662 or otherwise) of non-UID items and
material will no longer be required, unless otherwise specified in the
contract.
10. Comment: One respondent requested that the reporting
requirement be kept the same as the data currently required by the
clause at DFARS 252.211-7003, Item Identification and Valuation, to
ease the administration for contractors, since that data is the same as
the data that is already required for deliverables and other financial
reporting.
DoD Response: The master data is the same. However, many of the
additional data elements are optional. For example, mark data is an
optional data element that was added to accommodate virtual unique item
identifiers (UIIs) if the compliant 2D data matrix is not permanently
marked with the UII data on the item.
11. Comment: Three respondents requested that the requirement to
update PIPC records in the IUID Registry when PIPC is ``consumed or
expended'' be deleted, with the rationale being that ``consumed''
material is not part of PIPC. The comments further suggested that
Government-furnished material would not be uniquely identified.
DoD Response: As items with a UII go through the excess process,
the IUID Registry must be updated to record the disposition. These
items will include equipment, as well as DoD serially managed,
controlled, or mission essential items, whether equipment or material.
12. Comment: One respondent requested clarification as to whether
the Government or the contractor is responsible for marking Government
property furnished under new contracts.
DoD Response: The contractor is responsible for marking any
unmarked Government property furnished under a contract. Marking
unmarked items is included in the requirement to provide IUID data
electronically into the IUID Registry, and must be done prior to the
items leaving the contractor's stewardship, possession, or control.
13. Comment: One respondent requested that the requirement to
report PIPC that has not been marked by the Government be waived,
because it will be burdensome for contractors to obtain the information
from the requirements office that is needed to register the item, e.g.,
acquisition cost, contract under which the item was manufactured,
purchase date. Further, if the property is a depot rebuilt item, the
respondent indicated there may not be a way to determine the original
manufacturer, acquisition cost, or contract under which the item was
originally delivered to the Government.
DoD Response: The required data to be reported for the items that
will require IUID is not significantly different from the detailed data
currently maintained in the contractor's stewardship accountability
records. There are several optional data fields. For example, the
manufacturer and original acquisition contract information for a depot
rebuilt item is requested, if known, but it is not mandatory.
14. Comment: One respondent stated that the rule should address who
is responsible for researching and correcting errors in the IUID
Registry, for errors made by a transferring contractor.
DoD Response: The transfer of property from one accountable
contractor to another is a transaction that is typically initiated by
the program office directing the shipment of the property and validated
by the losing and gaining contractors. If the data in the IUID Registry
is not consistent with the contract for the accountable contractor of
record, an error will be generated and the record cannot be registered
until the discrepancy is corrected. The initial responsibility for
correcting errors is with the submitter of the data. It should also be
noted that contractors are still required to maintain stewardship
accountability records and implement the proper controls for Government
property in their custody, and they are still subject to audits and
inspections.
15. Comment: One respondent asked whether UIIs that include
contractor-unique Commercial and Government Entity (CAGE) codes or Data
Universal Numbering System (DUNS) numbers should be revised when the
property is transferred to another contractor.
DoD Response: UIIs with contractor-unique CAGE codes or DUNS
numbers are not revised when the property is transferred to another
contractor. The contractor that originally assigns the UII guarantees
its uniqueness, and the UII for an item, once assigned, is never
changed.
16. Comment: One respondent requested that the requirement to
update PIPC records in the IUID Registry for PIPC ``delivered or
shipped from a contractor's plant'' be revised to PIPC ``physically
delivered (shipped from the contractor's plant),'' to eliminate non-
value marking of ship-in-place items.
DoD Response: While contractor-acquired property is not recorded in
the IUID Registry, contractor-acquired property that transitions to a
follow-on contract becomes Government-furnished property under the
subsequent contract and, therefore, requires that a UII be assigned and
recorded in the IUID Registry. This may include ship-in-place items.
17. Comment: One respondent noted that the title of the guidebook
and the related link referenced in the rule need to be updated.
DoD Response: DoD has included this change in the interim rule.
18. Comment: Two respondents requested that the IUID data
submission requirements be included in the contract clause, instead of
referring to a guide for the data submission requirements, as the
Government could change the guide without requesting public comment.
DoD Response: DoD has revised the contract clause as recommended,
to include additional IUID data submission requirements. The guidebook
link is included in the clause as a reference to the procedures for
providing the IUID data electronically into the IUID Registry. Any
changes to the IUID data submission requirements in the clause will be
vetted through the normal public comment process.
19. Comment: One respondent stated that requiring contractors to
update the
[[Page 52296]]
registry to reconcile contractor and Government records was a violation
of the ``one record database'' concept.
DoD Response: The IUID Registry will be used for reporting of PIPC,
and replaces the annual reporting requirement only. It does not replace
the contractor's stewardship accountability recordkeeping requirements.
20. Comment: Two respondents disagreed with the statement in the
preamble that the requirements of the rule are not expected to
significantly change the burden hours approved by the Office of
Management and Budget (OMB), indicating that the administrative burden
and paperwork required to meet the requirements of the rule will
greatly expand the burden hours previously approved by OMB. One
respondent further requested that only one yearly reconciliation be
required, to limit the burden on contractors.
DoD Response: Under this rule, contractors are only required to
report a portion of the property presently reported on DD Form 1662.
For example, contractors will not report low-value items (under $5,000)
unless otherwise specified in the contract. In addition, contractors
will not report contractor-acquired property. The data that will be
reported is not significantly different from the detailed data
currently maintained in the contractor's stewardship accountability
records. Like the contractor's stewardship accountability records,
updates are only required when there are significant changes or updates
as defined in the rule. If a contractor updates the IUID Registry on a
transaction basis, the contractor will not need to again update the
IUID Registry semi-annually. If the contractor does not update the IUID
Registry on a transaction basis, semi-annual updates will be required
only to synchronize the contractor's data with the IUID Registry.
Annual summary reporting is no longer required. The decrease in scope
and size, from an annual roll-up of 100 percent of the Government
property in a contractor's custody, to maintenance of only the portion
of PIPC requiring IUID more than offsets the burden hours.
21. Comment: One respondent requested elimination of the
requirement for contractors to maintain real property records in the
owning military department's real property inventory system, and that
the owning agency maintain the records, because contractors are
normally granted ``use rights'' and the Government retains
accountability.
DoD Response: The requirement for contractors to maintain real
property records in the owning military department's real property
inventory system has been excluded from the interim rule.
22. Comment: One respondent requested clarification as to whether
the prime contractor or the subcontractor is responsible for marking
and registering the UII and item level master data for PIPC, if the
PIPC is received without an existing UII.
DoD Response: The prime contractor is responsible for ensuring that
the requirement is met for all DoD property in the custody of its
subcontractors. Registration of items in the IUID Registry should also
be controlled by the prime contractor, whose contract is the
accountable contract on record in the IUID Registry for PIPC. Prime
contractors also have the clause at DFARS 252.211-7003, Item
Identification and Valuation, in the contract and are required to flow
the IUID requirements down to their subcontractors. This may be done by
including the clause at DFARS 252.211-7003 in all subcontracts, so that
items received from suppliers meet the requirement, or by establishing
alternative marking agreements with subcontractors. When registering an
embedded item, a parent item must be registered prior to registering
any embedded components, subassemblies, or parts within that parent
item.
23. Comment: One respondent requested that the phrase ``furnished
to the contractor by the Government'' be deleted from paragraphs
III.A.1 and 3 of the guidebook, because Government-furnished property
has already been defined, making the terminology redundant.
DoD Response: The content of the guidebook is beyond the scope of
this DFARS rule. However, the IUID Program Office agrees the
terminology is redundant and is revising the guidebook accordingly.
24. Comment: One respondent recommend that ``unique item identifier
(UII)'' be defined, since the term is used in the rule.
DoD Response: The definition of ``UII'' and other key definitions
from the clause at DFARS 252.211-7003, Item Identification and
Valuation, have been added to the clause at DFARS 252.211-7007.
25. Comment: One respondent suggested that the terminology in the
definition of ``property in the possession of the contractor'' be
changed to refer to ``organizational property'' instead of ``personal
property,'' because ``personal property'' is generally understood to
mean all property other than real property.
DoD Response: The definition of ``property in the possession of the
contractor'' is meant to distinguish tangible personal property in the
custody of contractors from all Government property that is owned or
leased by the Government. It does not include real property.
26. Comment: Two respondents requested clarification of the on-line
guidebook as to whether ``controlled'' or ``public'' access is the
correct access level for contractors, and whether ``contractor access''
is the same as ``controlled access.''
DoD Response: The content of the guidebook is beyond the scope of
this DFARS rule. However, there are two levels of access,
``controlled'' and ``public,'' and the levels are the same for both
contractor and Government users. Controlled access requires validation
of authority to access the data, and is limited depending on the role
assigned. Controlled access is further distributed to access for
Government roles such as Program Manager or Legacy Submitter and
Contractor roles. Public access is a limited view that only returns a
unique item identifier and is available without pre-registration or a
user id and password. The user guide for the IUID Registry available at
https://www.bpn.gov/iuid/ provides greater detail regarding access to
the IUID Registry.
27. Comment: Two respondents requested clarification as to who pays
the cost of ``marking'' the items, when the Government provides the UII
to the contractor but requires the contractor to mark any unmarked
items, indicating that contractors who do not manufacture items that
require marking would have to contract to ``mark'' these items.
DoD Response: If a contractor receives PIPC that has not been
registered or marked, the contractor is required to assign the UII,
register the IUID data, and mark the item, or mark the item and update
the IUID Registry, if the UII has been provided but the item has not
been marked. The cost for IUID is generally an allowable cost, and
contractors submitting offers on requirements that include IUID should
include the costs in accordance with Cost Accounting Standard and FAR
requirements. In addition, there is a memorandum available on the UID
Web site at http://www.acq.osd.mil/dpap/UID/policy.htm that discusses
pricing and accounting for costs associated with IUID.
28. Comment: One respondent indicated that Paragraphs 12 and 13 of
the guidebook were repetitive and confusing.
[[Page 52297]]
DoD Response: The content of the guidebook is beyond the scope of
this DFARS rule. However, the IUID Program Office is revising the
format of the guidebook to clarify the referenced requirements.
Paragraph 12 addresses the requirement for contractors to assign a UII
to an embedded item that does not have an existing UII, whenever the
embedded item is removed from its parent while in the contractor's
custody. Paragraph 13 addresses the requirement to maintain the data in
the IUID Registry for embedded items that have an existing UII assigned
prior to it being provided to the contractor as PIPC.
29. Comment: Two respondents recommended that the rule be revised
to make the Government, not the contractor, responsible for
establishing the UII.
DoD Response: The Government will provide the UII if it already
exists, or if it is created and the item is marked under a legacy IUID
implementation strategy before providing the item to the contractor as
PIPC. In addition, all contracts awarded under solicitations issued
after January 1, 2004, should have the clause at DFARS 252.211-7003,
Item Identification and Valuation, and any items delivered that are
subsequently provided to contractors as PIPC will already have a UII
established. However, if a contractor receives PIPC that has not been
registered or marked, the contractor is required to assign the UII,
register the IUID data, and mark the item.
This rule was not subject to Office of Management and Budget review
under Executive Order 12866, dated September 30, 1993.
B. Regulatory Flexibility Act
DoD has prepared an initial regulatory flexibility analysis
consistent with 5 U.S.C. 603. A copy of the analysis may be obtained
from the point of contact specified herein. The analysis is summarized
as follows:
This interim rule amends the DFARS to require DoD contractors to
electronically submit, to the IUID Registry, the IUID data for DoD
property in the contractor's possession. The existing requirements for
contractor reporting of Government property rely on a paper-based
administrative infrastructure, and do not provide DoD with sufficient
information to validate the existence, completeness, or valuation of
Government property in the possession of contractors. This rule will
facilitate DoD compliance with the Chief Financial Officers Act of 1990
(Pub. L. 101-576) and the financial reporting requirements imposed by
the Federal Accounting Standards Advisory Board.
The rule generally will apply to DoD contractors with Government-
furnished property valued at $5,000 or more. The objective of the rule
is to improve the accountability and control of DoD assets. Use of the
IUID Registry will enable DoD to maintain accurate records of its
property inventories. The Chief Financial Officers Act of 1990 requires
the production of complete, reliable, timely, and consistent financial
information with regard to Federal programs.
The clause at DFARS 252.245-7001 requires contractors to maintain
records of DoD property in their possession and to submit an annual
report using DD Form 1662 or an approved substitute. The interim rule
replaces DD Form 1662 reporting with requirements for use of the IUID
Registry as an electronic means of recording and reporting DoD property
in the contractor's possession. This will improve the accuracy and
efficiency of the existing reporting and recordkeeping requirements.
DoD considers the approach described in the interim rule to be the
most practical and beneficial for both Government and industry.
Continued reliance on the current reporting process would not permit
the level of accountability that DoD needs to comply with statutory and
regulatory requirements related to the management of Government
property. DoD already has adopted the use of IUID technology as the
standard marking approach for all items in DoD's inventory system.
Therefore, it logically follows that DoD property in the possession of
contractors should also be recorded and reported using IUID technology.
DoD invites comments from small businesses and other interested
parties. DoD also will consider comments from small entities concerning
the affected DFARS subparts in accordance with 5 U.S.C. 610. Such
comments should be submitted separately and should cite DFARS Case
2005-D015.
C. Paperwork Reduction Act
The information collection requirements associated with contractor
reporting of Government property have been approved by the Office of
Management and Budget, under Clearance Number 0704-0246, for use
through April 30, 2009. The requirements of this interim rule are not
expected to significantly change the burden hours approved under
Clearance Number 0704-0246.
D. Determination To Issue an Interim Rule
A determination has been made under the authority of the Secretary
of Defense that urgent and compelling reasons exist to publish an
interim rule prior to affording the public an opportunity to comment.
DoD published a proposed rule on March 21, 2006, addressing
requirements for use of the IUID Registry for reporting of Government
property in the possession of contractors, to replace the DD Form 1662
reporting system. The vast majority of comments received on the
proposed rule were accepted and incorporated into this interim rule.
Because of the additional changes in this rule, DoD believes it is
necessary to solicit further public comments. Numerous DoD contractors
have already voluntarily transitioned to the use of the IUID Registry
for reporting of Government property. Immediate implementation of this
DFARS rule is needed to clearly establish policy for IUID reporting of
Government property, in recognition of the burdens associated with
supporting dual reporting systems. DoD considers the IUID Registry to
be the most practical and beneficial reporting method for both
Government and industry. Comments received in response to this interim
rule will be considered in the formation of the final rule.
List of Subjects in 48 CFR Parts 211, 245, and 252
Government procurement.
Michele P. Peterson,
Editor, Defense Acquisition Regulations System.
0
Therefore, 48 CFR parts 211, 245, and 252 are amended as follows:
0
1. The authority citation for 48 CFR parts 211, 245, and 252 continues
to read as follows:
Authority: 41 U.S.C. 421 and 48 CFR Chapter 1.
PART 211--DESCRIBING AGENCY NEEDS
0
2. Section 211.274 is revised to read as follows:
211.274 Item identification and valuation requirements.
0
3. Section 211.274-4 is revised to read as follows:
211.274-4 Policy for item unique identification of Government
property.
(a) It is DoD policy that DoD item unique identification, or a DoD-
recognized unique identification equivalent, is required for tangible
[[Page 52298]]
personal property in accordance with 211.274-2, for items--
(1) In the possession of the Government and furnished to a
contractor for the performance of a contract; or
(2) Directly acquired by the Government and subsequently furnished
to a contractor for the performance of a contract.
(b) The policy in paragraph (a) of this subsection does not apply
to--
(1) Property under any statutory leasing authority;
(2) Property to which the Government has acquired a lien or title
solely because of partial, advance, progress, or performance-based
payments;
(3) Software and intellectual property; or
(4) Real property.
0
4. Section 211.274-5 is added to read as follows:
211.274-5 Contract clauses.
(a)(1) Use the clause at 252.211-7003, Item Identification and
Valuation, in solicitations and contracts that--
(i) Require item identification or valuation, or both, in
accordance with 211.274-2 and 211.274-3; or
(ii) Contain the clause at 252.211-7007.
(2) Complete paragraph (c)(1)(ii) of the clause with the contract
line, subline, or exhibit line item number and description of any
item(s) below $5,000 in unit acquisition cost for which DoD unique item
identification or a DoD recognized unique identification equivalent is
required in accordance with 211.274-2(a)(2) or (3).
(3) Complete paragraph (c)(1)(iii) of the clause with the
applicable attachment number, when DoD unique item identification or a
DoD recognized unique identification equivalent is required in
accordance with 211.274-2(a)(4) for DoD serially managed subassemblies,
components, or parts embedded within deliverable items.
(4) Use the clause with its Alternate I if--
(i) An exception in 211.274-2(b) applies; or
(ii) Items are to be delivered to the Government and none of the
criteria for placing a unique item identification mark applies.
(b)(1) Use the clause at 252.211-7007, Item Unique Identification
of Government Property, in solicitations and contracts that contain the
clause at--
(i) FAR 52.245-1, Government Property; or
(ii) FAR 52.245-2, Government Property Installation Operation
Services.
(2) Complete paragraph (b)(2)(ii) of the clause as applicable.
PART 245--GOVERNMENT PROPERTY
245.505-14 [Removed]
0
5. Section 245.505-14 is removed.
PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
252.211-7003 [Amended]
0
6. Section 252.211-7003 is amended in the introductory text by removing
``211.274-4'' and adding in its place ``211.274-5(a)''.
0
7. Section 252.211-7007 is added to read as follows:
252.211-7007 Item unique identification of Government property.
As prescribed in 211.274-5(b), use the following clause:
ITEM UNIQUE IDENTIFICATION OF GOVERNMENT PROPERTY (SEP 2007)
(a) Definitions. As used in this clause--
2D data matrix symbol means the 2-dimensional Data Matrix ECC
200 as specified by International Standards Organization/
International Electrotechnical Commission (ISO/IEC) Standard 16022:
Information Technology--International Symbology Specification--Data
Matrix.
Acquisition cost, for Government-furnished property in the
possession of the Contractor (PIPC), means the amount identified in
the contract, or in the absence of such identification, the fair
market value. For property acquired or fabricated by the Contractor
as Contractor-acquired PIPC, and subsequently transferred or
delivered as Government-furnished PIPC, it is the original
acquisition cost.
Concatenated unique item identifier means--
(1) For items that are serialized within the enterprise
identifier, the linking together of the unique identifier data
elements in order of the issuing agency code, enterprise identifier,
and unique serial number within the enterprise identifier; or
(2) For items that are serialized within the original part, lot,
or batch number, the linking together of the unique identifier data
elements in order of the issuing agency code; enterprise identifier;
original part, lot, or batch number; and serial number within the
original part, lot, or batch number.
DoD recognized unique identification equivalent means a unique
identification method that is in commercial use and has been
recognized by DoD. All DoD recognized unique identification
equivalents are listed at http://www.acq.osd.mil/dpap/UID/equivalents.html.
Equipment means a tangible item that is functionally complete
for its intended purpose, durable, nonexpendable, and needed for the
performance of a contract. Equipment is not intended for sale, and
does not ordinarily lose its identity or become a component part of
another article when put into use.
Item unique identification (IUID) means a system of assigning,
reporting, and marking DoD property in the possession of the
Contractor with unique item identifiers that have machine-readable
data elements to distinguish an item from all other like and unlike
items.
IUID Registry means the DoD data repository that receives input
from both industry and Government sources and provides storage of,
and access to, data that identifies and describes tangible
Government personal property, including property in the possession
of the Contractor.
Material means property that may be consumed or expended during
the performance of a contract, component parts of a higher assembly,
or items that lose their individual identity through incorporation
into an end item. Material does not include equipment, special
tooling, or special test equipment.
Parent item means the item assembly, intermediate component, or
subassembly that has an embedded item with a unique item identifier
or DoD recognized unique identification equivalent.
Property in the possession of the Contractor (PIPC) means
tangible personal property, to which the Government has title, that
is in the stewardship or possession of, or is controlled by, the
Contractor for the performance of a contract. PIPC consists of both
tangible Government-furnished property and Contractor-acquired
property and includes equipment and material.
Unique item identifier (UII) means a set of data elements marked
on items that is globally unique and unambiguous.
Virtual UII means the data elements for an item that have been
captured in the IUID Registry, but have not yet been physically
marked on an item with a DoD compliant 2D data matrix symbol.
(b) Procedures for assigning and registering.
(1) The Contractor shall provide IUID data for the IUID Registry
for all Government-furnished PIPC requiring DoD unique
identification under this contract, including Government-furnished
PIPC located at subcontractor and alternate locations.
(2) Unless the Government provides the UII, the Contractor shall
establish a concatenated UII or a DoD recognized unique
identification equivalent for--
(i) Government-furnished PIPC with a unit acquisition cost of
$5,000 or more; and
(ii) The following items of Government-furnished PIPC for which
the unit acquisition cost is less than $5,000:
------------------------------------------------------------------------
Contract line, subline, or exhibit line
item number (if applicable) Item description
------------------------------------------------------------------------
------------------------------------------------------------------------
------------------------------------------------------------------------
------------------------------------------------------------------------
(3) Virtual UIIs may be assigned by the Contractor for existing
Government-furnished PIPC requiring item unique identification, if
the property can be accurately and uniquely
[[Page 52299]]
identified using existing innate serialized identity until an event
occurs requiring physical marking with the DoD compliant 2D data
matrix.
(4) The Contractor shall assign and register a UII and the
master item data for any subassembly, component, or part that does
not have an existing UII when it is removed from a parent item and
remains with the Contractor as a stand-alone item.
(5) Contractor-acquired PIPC is excluded from the IUID Registry.
The Contractor shall report to the IUID Registry as Government-
furnished PIPC any Contractor-acquired PIPC that--
(i) Is delivered to the Government; or
(ii) Is transferred by contract modification or other contract
provision/requirement to another contract (including items that are
transferred in place).
(6) If the initial transfer of Contractor-acquired PIPC is a
delivery to DoD, the requirements of the Item Identification and
Valuation clause of this contract (DFARS 252.211-7003) shall be
applied when determining the requirement for item unique
identification.
(7) The Contractor shall submit the UII and the master item data
into the IUID Registry in accordance with the data submission
procedures in the Item Unique Identification of Government Property
Guidebook at http://www.acq.osd.mil/dpap/UID/guides.htm.
(i) The following data is required for Government-furnished PIPC
items received without a UII:
(A) UII type.
(B) Concatenated UII.
(C) Item description.
(D) Foreign currency code.
(E) Unit of measure.
(F) Acquisition cost.
(G) Mark information.
(1) Bagged or tagged code.
(2) Contents.
(3) Effective date.
(4) Added or removed flag.
(5) Marker code.
(6) Marker identifier.
(7) Medium code.
(8) Value.
(H) Custody information.
(1) Prime contractor identifier.
(2) Accountable contract number.
(3) Category code.
(4) Received date.
(5) Status code.
(ii) The following data is required only for Government-
furnished PIPC items received without a UII for specific ``UII
types,'' as specified in the Item Unique Identification of
Government Property Guidebook:
(A) Issuing agency code.
(B) Enterprise identifier.
(C) Original part number.
(D) Batch/lot number.
(E) Serial number.
(iii) The following data is optional for Government-furnished
PIPC items received without a UII:
(A) Acquisition contract number.
(B) Contract line item number/subline item number/exhibit line
item number.
(C) Commercial and Government Entity (CAGE) code or Data
Universal Numbering System (DUNS) number in the acquisition
contract.
(D) Current part number.
(E) Current part number effective date (required if current part
number is provided).
(F) Acceptance location.
(G) Acceptance date.
(H) Ship-to code.
(I) Sent date.
(J) Manufacturer identifier.
(K) Manufacturer code (required if manufacturer identifier is
provided).
(L) Parent UII (for embedded items).
(c) Procedures for updating. (1) The Contractor shall update the
IUID Registry for changes in status, mark, custody, or disposition
of Government-furnished PIPC under this contract, for PIPC-
(i) Delivered or shipped from the Contractor's plant, under
Government instructions, except when shipment is to a subcontractor
or other location of the Contractor;
(ii) Consumed or expended, reasonably and properly, or otherwise
accounted for, in the performance of the contract as determined by
the Government property administrator, including reasonable
inventory adjustments;
(iii) Disposed of; or
(iv) Transferred to a follow-on or other contract.
(2) The Contractor shall update the IUID Registry for changes to
the mark information to add or remove other serialized
identification marks and to update a virtual UII to a fully
compliant UII when the 2D data matrix symbol is added to the item.
(3) The Contractor shall update the IUID Registry for any
changes to the current part number or the current part number
effective date.
(4) The Contractor shall update the IUID Registry for any
changes to the parent item of a DoD serially managed embedded
subassembly, component, or part.
(5) The Contractor shall update the IUID Registry for all
Government-furnished PIPC under this contract, so that the IUID
Registry reflects the same information that is recorded in the
Contractor's property records for Government-furnished PIPC as
transactions occur, or at least semi-annually by March 31 and
September 30 of each year.
(d) Procedures for marking. (1) When an event occurs that
requires the physical marking of the item with the 2D data matrix
symbol, the Contractor shall use the previously assigned virtual UII
as the permanent UII.
(2) The Contractor shall use MIL-STD-130M (or later version)
when physically marking existing PIPC with the compliant 2D data
matrix symbol. The Contractor that has possession of the PIPC shall
use due diligence to maintain the integrity of the UII and shall
replace a damaged, destroyed, or lost mark with a replacement mark
that contains the same UII data elements, as necessary. The
Contractor shall apply the required 2D data matrix symbol to an
identification plate, band, tag, or label securely fastened to the
item, or directly to the surface of the item to be compliant.
(3) When an item cannot be physically marked or tagged due to a
lack of available space to mark identifying information or because
marking or tagging would have a deleterious effect, the Contractor
shall--
(i) Attach to the item a tag that has the identifying
information marked on the tag;
(ii) Place the item in a supplemental bag or other package that
encloses the item and has a tag attached to the bag or package that
has the identifying information marked on the tag; or
(iii) Apply the identifying information to the unit pack in
addition to, or in combination with, the identification marking
information specified in MIL-STD-129. When combining marking
requirements for a unit pack, the Contractor shall follow the
manner, method, form, and format of MIL-STD-129 and shall fulfill
the informational requirements of that standard.
(4) When the item has the tag removed or the item is removed
from the bag to be installed as an embedded item in a parent item,
the Contractor shall--
(i) Assign a UII or a virtual UII to the parent item if a UII
does not already exist;
(ii) Mark the parent item with the DoD compliant 2D data matrix
symbol, if feasible; and
(iii) Update the IUID Registry to indicate that the tagged or
bagged UII item has become an embedded item within the parent item.
(5) In the event a previously tagged or bagged embedded item is
subsequently removed from use, the Contractor shall tag or bag and
mark the item again with the original UII.
(End of clause)
252.245-7001 [Removed]
0
8. Section 252.245-7001 is removed.
[FR Doc. E7-18039 Filed 9-12-07; 8:45 am]
BILLING CODE 5001-08-P