[Federal Register Volume 72, Number 235 (Friday, December 7, 2007)]
[Proposed Rules]
[Pages 69176-69177]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-23654]
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DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System
48 CFR Parts 225 and 231
RIN 0750-AF85
Defense Federal Acquisition Regulation Supplement; Allowability
of Costs To Lease Government Equipment for Display or Demonstration
(DFARS Case 2007-D004)
AGENCY: Defense Acquisition Regulations System, Department of Defense
(DoD).
ACTION: Proposed rule with request for comments.
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SUMMARY: DoD is proposing to amend the Defense Federal Acquisition
Regulation Supplement (DFARS) to address limitations on the
allowability of contractor costs associated with the leasing of
Government equipment for display or demonstration. The proposed rule
specifies that monies paid to the Government for the leasing of
Government equipment are unallowable, except in the case of foreign
military sales contracts.
DATES: Comments on the proposed rule should be submitted in writing to
the address shown below on or before February 5, 2008, to be considered
in the formation of the final rule.
ADDRESSES: You may submit comments, identified by DFARS Case 2007-D004,
using any of the following methods:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
E-mail: [email protected]. Include DFARS Case 2007-D004 in the
subject line of the message.
Fax: 703-602-7887.
Mail: Defense Acquisition Regulations System, Attn: Mr.
John McPherson, OUSD (AT&L) DPAP (CPF), IMD 3D139, 3062 Defense
Pentagon, Washington, DC 20301-3062.
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.
FOR FURTHER INFORMATION CONTACT: Mr. John McPherson, 703-602-0296.
SUPPLEMENTARY INFORMATION:
A. Background
DoD Directive 7230.8, Leases and Demonstrations of DoD Equipment,
[[Page 69177]]
contains policy on the leasing of DoD equipment to defense contractors
for demonstration to foreign governments or for display or
demonstration at international trade shows and exhibitions. In addition
to the leasing of equipment, contractors may obtain related support
services from DoD. The Directive provides that the contractor leasing
the equipment may not recover the DoD charges associated with the
lease, directly or indirectly through any U.S. Government contract,
except to the extent chargeable to contracts for foreign military
sales. For consistency with the policy in DoD Directive 7230.8, this
proposed rule adds DFARS text to address the limitations on the
allowability of costs associated with the leasing of Government
equipment.
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 does not expect this rule 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 is
consistent with existing DoD policy, and applies only in those
situations where a contractor chooses to lease military equipment for
display or demonstration purposes. Therefore, DoD has not performed an
initial regulatory flexibility analysis. 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 2007-D004.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply, because the rule does
not impose any 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 225 and 231
Government procurement.
Michele P. Peterson,
Editor, Defense Acquisition Regulations System.
Therefore, DoD proposes to amend 48 CFR parts 225 and 231 as
follows:
1. The authority citation for 48 CFR parts 225 and 231 continues to
read as follows:
Authority: 41 U.S.C. 421 and 48 CFR Chapter 1.
PART 225--FOREIGN ACQUISITION
2. Section 225.7303-2 is amended by revising paragraph (b) and
adding paragraph (e) to read as follows:
225.7303-2 Cost of doing business with a foreign government or an
international organization.
* * * * *
(b) Costs not allowable under FAR Part 31 are not allowable in
pricing FMS contracts, except as noted in paragraphs (c) and (e) of
this subsection.
* * * * *
(e) The limitations on allowability of costs associated with
leasing Government equipment, in 231.205-1, do not apply to FMS
contracts.
PART 231--CONTRACT COST PRINCIPLES AND PROCEDURES
3. Section 231.205-1 is added to read as follows:
231.205-1 Public relations and advertising costs.
(e) See 225.7303-2(e) for allowability provisions affecting foreign
military sales contracts.
(f) Unallowable public relations and advertising costs also include
monies paid to the Government associated with the leasing of Government
equipment, including lease payments and reimbursement for support
services, except for foreign military sales contracts as provided for
at 225.7303-2.
[FR Doc. E7-23654 Filed 12-6-07; 8:45 am]
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