[Federal Register Volume 73, Number 114 (Thursday, June 12, 2008)]
[Rules and Regulations]
[Pages 33636-33640]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-13154]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 4, 15, 25, and 52
[FAC 2005-26; FAR Case 2008-004;Docket 2008-0001, Sequence 04]
RIN 9000-AL01
Federal Acquisition Regulation; FAR Case 2008-004, Prohibition on
Restricted Business Operations in Sudan and Imports from Burma
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Interim rule with request for comments.
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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
Section 6 of the Sudan Accountability and Divestment Act of 2007.
Section 6 requires certification in each contract entered into by an
Executive agency, that the contractor does not conduct certain business
operations in Sudan.
DATES: Effective Date: June 12, 2008.
Comment Date: Interested parties should submit written comments to
the FAR Secretariat on or before August 11, 2008 to be considered in
the formulation of a final rule.
ADDRESSES: Submit comments identified by FAC 2005-26, FAR case 2008-
004, by any of the following methods:
Regulations.gov: http://www.regulations.gov. Submit
comments via the Federal eRulemaking portal by inputting ``FAR Case
2008-004'' under the heading ``Comment or Submission''. Select the link
``Send a Comment or Submission'' that corresponds with FAR Case 2008-
004. Follow the instructions provided to complete the ``Public Comment
and Submission Form''. Please include your name, company name (if any),
and ``FAR Case 2008-004'' on your attached document.
Fax: 202-501-4067.
Mail: General Services Administration, Regulatory
Secretariat Division (VPR), 1800 F Street, NW, Room 4041, Washington,
DC 20405.
[[Page 33637]]
Instructions: Please submit comments only and cite FAC 2005-26, FAR
case 2008-004, in all correspondence related to this case. All comments
received will be posted without change to http://www.regulations.gov,
including any personal and/or business confidential information
provided.
FOR FURTHER INFORMATION CONTACT Ms. Meredith Murphy, Procurement
Analyst, at (202) 208-6925 for clarification of content. For
information pertaining to status or publication schedules, contact the
Regulatory Secretariat Division at (202) 501-4755. Please cite FAC
2005-26, FAR case 2008-004.
SUPPLEMENTARY INFORMATION:
A. Background
This interim rule implements section 6 of the Sudan Accountability
and Divestment Act of 2007 (Pub. L. 110-174), which was signed on
December 31, 2007. Section 6 of this Act requires certification in each
contract entered into by an executive agency, that the contractor does
not conduct certain business operations in Sudan (as described in
section 3(d) of the Act).
The Councils have added these restrictions to FAR Subpart 25.7,
Prohibited Sources, because the current sections 25.701 and 25.702 are
related to each other, they have been combined into a single section,
and the new restrictions added as a new section 25.702.
Subsection 25.702-1 provides the statutory definitions of the
following terms from the Act:
Appropriate congressional committees.
Business operations.
Marginalized populations of Sudan.
Person.
Restricted business operations (referring to the business
operations described in section 3(d) of the Act).
Subsections 25.702-2 and 25.702-3 state the certification
requirements and the remedies specified in the Act. Subsection 25.702-4
permits the President to waive the certification requirement.
Consistent with the structure of FAR Part 25, the prescription for the
solicitation provision is provided at FAR 25.1103(d).
The new solicitation provision 52.225-20, Prohibition on Conducting
Restricted Business Operations in Sudan--Certification, provides all
the required definitions and the condition that, by submission of its
offer, the offeror certifies that it does not conduct any restricted
business operations in Sudan. If the offeror cannot affirmatively make
the certification that it does not conduct restricted business
operations in Sudan, then it is not allowed to submit an offer. The
Councils are determining whether this law should also apply to existing
contracts to ensure compliance with the overall intent of the law.
The Act does not require flow down of the certification provision.
Section 6 addresses only contracts entered into by executive agencies.
The FAR Council has made a policy determination to apply the
prohibition to contracts for the acquisition of commercial items. In
accordance with Section 34 of the Office of Federal Procurement Policy
(OFPP) Act (41 U.S.C. 430), the law would not apply to acquisitions of
commercial items unless the FAR Council made a written determination
that it would not be in the best interest of the Federal Government to
waive the provision of law for the acquisition of commercial items.
This is because the Sudan Accountability and Divestment Act of 2007--
Does impose restrictions on the procurement of property or
services by the Federal Government;
Does not provide civil or criminal penalties; and
Does not specifically refer to Section 34 of the OFPP Act.
Section 6 of Pub. L. 110-174 establishes a public policy that
contractors who conduct certain business operations in Sudan shall not
be permitted to do business with the Federal Government. An exemption
for commercial item acquisitions would exclude a significant portion of
Federal contracting and the contractors who provide these products and
services, thereby undermining the overarching public policy purpose of
the law.
In addition, the Councils have taken this opportunity to add Burma
to the list of countries from which most imports are prohibited. This
update is made in accordance with Executive Order (E.O.) 13310,
Blocking Property of the Government of Burma and Prohibiting Certain
Transactions (68 FR 44853, July 30, 2003), and E.O. 13448, Blocking
Property and Prohibiting Certain Transactions Related to Burma (72 FR
60223, October 23, 2007). The FAR at 25.701(b) and the clause at
52.225-13(b) are modified.
This is a significant regulatory action and, therefore, is subject
to review under Section 6(b) of Executive Order 12866, Regulatory
Planning and Review, dated September 30, 1993. This rule is 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., because this
rule will only impact an offeror that is conducting restricted business
operations in Sudan and wants to do business with the Government. Since
there are already numerous sanctions against dealing with Sudan (e.g.,
E.O.s 13412, 13400, and 13067, and 31 CFR Part 538), it is expected
that the number of entities impacted by this rule will be minimal.
Therefore, an Initial Regulatory Flexibility Analysis has not been
performed. The Councils will consider comments from small entities
concerning the affected FAR Parts 4, 15, 25, and 52 in accordance with
5 U.S.C. 610. Interested parties must submit such comments separately
and should cite 5 U.S.C. 601, et seq. (FAC 2005-26, FAR case 2008-004),
in all correspondence.
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.
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 rule implements section 6 of The Sudan
Accountability and Divestment Act of 2007 (Pub. L. 110-174), which was
signed on December 31, 2007, and was effective upon enactment. However,
pursuant to Pub. L. 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 4, 15, 25, and 52
Government procurement.
Dated: June 6, 2008.
Al Matera,
Director, Office of Acquisition Policy.
0
Therefore, DoD, GSA, and NASA amend 48 CFR parts 4, 15, 25, and 52 as
set forth below:
[[Page 33638]]
0
1. The authority citation for 48 CFR parts 4, 15, 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 4--ADMINISTRATIVE MATTERS
4.203 [Amended]
0
2. Amend section 4.203 by--
0
a. Removing from paragraph (a) ``paragraph (b)'' and adding ``paragraph
(l)'' in its place; and
0
b. Removing from paragraphs (b) and (e)(1)(i) ``52.212-3(b)'' and
adding ``52.212-3(l)'' in its place.
4.1201 [Amended]
0
3. Amend section 4.1201 by removing from paragraph (c) ``52.212-3(l)''
and adding ``52.212-3(b)'' in its place.
0
4. Amend section 4.1202 by redesignating paragraphs (y), (z), and (aa),
as paragraphs (z), (aa), and (bb), respectively; and adding a new
paragraph (y) to read as follows:
4.1202 Solicitation provision and contract clause.
* * * * *
(y) 52.225-20, Prohibition on Conducting Restricted Business
Operations in Sudan--Certification.
* * * * *
PART 15--CONTRACTING BY NEGOTIATION
15.102 [Amended]
0
5. Amend section 15.102 by removing from paragraph (b) ``52.212-3(1)''
and adding ``52.212-3(b)'' in its place.
PART 25--FOREIGN ACQUISITION
0
6. Revise Subpart 25.7 to read as follows:
Sec.
25.700 Scope of subpart.
25.701 Restrictions on acquisitions of supplies or services from
prohibited sources.
25.702 Prohibition on contracting with entities that conduct
restricted business operations in Sudan.
25.702-1 Definitions.
25.702-2 Certification.
25.702-3 Remedies.
25.702-4 Waiver.
Subpart 25.7--Prohibited Sources
25.700 Scope of subpart.
This subpart implements--
(a) Economic sanctions administered by the Office of Foreign Assets
Control (OFAC) in the Department of the Treasury prohibiting
transactions involving certain countries, entities, and individuals;
and
(b) The Sudan Accountability and Divestment Act of 2007 (Pub. L.
110-174).
25.701 Restrictions on acquisitions of supplies or services from
prohibited sources.
(a) Except as authorized by OFAC, agencies and their contractors
and subcontractors must not acquire any supplies or services if any
proclamation, Executive order, or statute administered by OFAC, or if
OFAC's implementing regulations at 31 CFR Chapter V, would prohibit
such a transaction by a person subject to the jurisdiction of the
United States.
(b) Except as authorized by OFAC, most transactions involving Cuba,
Iran, and Sudan are prohibited, as are most imports from Burma or North
Korea into the United States or its outlying areas. In addition, lists
of entities and individuals subject to economic sanctions are included
in OFAC's List of Specially Designated Nationals and Blocked Persons at
http://www.treas.gov/offices/enforcement/ofac/sdn. More information
about these restrictions, as well as updates, is available in OFAC's
regulations at 31 CFR Chapter V and/or on OFAC's website at http://www.treas.gov/offices/enforcement/ofac.
(c) Refer questions concerning the restrictions in paragraphs (a)
or (b) of this section to the Department of the Treasury, Office of
Foreign Assets Control, Washington, DC 20220, (Telephone (202) 622-
2490).
25.702 Prohibition on contracting with entities that conduct
restricted business operations in Sudan.
25.702-1 Definitions.
As used in this section--
Appropriate Congressional committees means--
(1) The Committee on Banking, Housing, and Urban Affairs, The
Committee on Foreign Relations, and the Select Committee on
Intelligence of the Senate; and
(2) The Committee on Financial Services, the Committee on Foreign
Relations, and the Permanent Select Committee on Intelligence of the
House of Representatives.
Business operations means engaging in commerce in any form,
including by acquiring, developing, maintaining, owning, selling,
possessing, leasing, or operating equipment, facilities, personnel,
products, services, personal property, real property, or any other
apparatus of business or commerce.
Marginalized populations of Sudan means--
(1) Adversely affected groups in regions authorized to receive
assistance under section 8(c) of the Darfur Peace and Accountability
Act (Pub. L. 109-344) (50 U.S.C. 1701 note); and
(2) Marginalized areas in Northern Sudan described in section 4(9)
of such Act.
Person means--
(1) A natural person, corporation, company, business association,
partnership, society, trust, any other nongovernmental entity,
organization, or group;
(2) Any governmental entity or instrumentality of a government,
including a multilateral development institution (as defined in section
1701(c)(3) of the International Financial Institutions Act (22 U.S.C.
262r(c)(3)); and
(3) Any successor, subunit, parent company or subsidiary of any
entity described in paragraphs (1) or (2) of this definition.
Restricted business operations--
(1) Means, except as provided in paragraph (2) of this definition,
business operations in Sudan that include power production activities,
mineral extraction activities, oil-related activities, or the
production of military equipment, as those terms are defined in the
Sudan Accountability and Divestment Act of 2007 (Pub. L. 110-174).
(2) Does not include business operations that the person conducting
the business can demonstrate--
(i) Are conducted under contract directly and exclusively with the
regional government of southern Sudan;
(ii) Are conducted pursuant to specific authorization from the
Office of Foreign Assets Control in the Department of the Treasury, or
are expressly exempted under Federal law from the requirement to be
conducted under such authorization;
(iii) Consist of providing goods or services to marginalized
populations of Sudan;
(iv) Consist of providing goods or services to an internationally
recognized peacekeeping force or humanitarian organization;
(v) Consist of providing goods or services that are used only to
promote health or education; or
(vi) Have been voluntarily suspended.
25.702-2 Certification.
As required by the Sudan Accountability and Divestment Act of 2007
(Pub. L. 110-174), each offeror must certify that it does not conduct
restricted business operations in Sudan.
[[Page 33639]]
25.702-3 Remedies.
Upon the determination of a false certification under subsection
25.702-2--
(a) The contracting officer may terminate the contract;
(b) The suspending official may suspend the contractor in
accordance with the procedures in Subpart 9.4; and
(c) The debarring official may debar the contractor for a period
not to exceed 3 years in accordance with the procedures in Subpart 9.4.
25.702-4 Waiver.
(a) The President may waive the requirement of subsection 25.702-2
on a case-by-case basis if the President determines and certifies in
writing to the appropriate congressional committees that it is in the
national interest to do so.
(b) An agency seeking waiver of the requirement shall submit the
request through the Administrator of the Office of Federal Procurement
Policy.
0
7. Amend section 25.1103 by adding paragraph (d) to read as follows:
25.1103 Other provisions and clauses.
* * * * *
(d) The contracting officer shall include in each solicitation for
the acquisition of products or services (other than commercial items
procured under Part 12) the provision at 52.225-20, Prohibition on
Conducting Restricted Business Operations in Sudan--Certification.
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
0
8. Amend section 52.212-1 by revising the date of the provision; and by
removing from paragraph (b)(8) ``52.212-3(1)'' and adding ``52.212-
3(b)'' in its place. The revised text reads as follows:
52.212-1 Instructions to Offerors--Commercial Items.
* * * * *
INSTRUCTIONS TO OFFERORS--COMMERCIAL ITEMS (JUN 2008)
* * * * *
0
9. Amend section 52.212-3 by--
0
a. Revising the date of the provision;
0
b. Removing from the introductory text of the provision ``paragraph
(1)'' and ``paragraphs (b) through (k)'' and adding ``paragraph (b)''
and ``paragraphs (c) through (m)'' in its place, respectively; and
0
c. Adding in paragraph (a), in alphabetical order, the definition
``Restricted business operations'';
0
d. Revising paragraphs (b) and (l); and
0
e. Adding paragraph (m) to read as follows:
52.212-3 Offeror Representations and Certifications--Commercial
Items.
* * * * *
OFFEROR REPRESENTATIONS AND CERTIFICATIONS--COMMERCIAL ITEMS
(JUN 2008)
* * * * *
(a) * * *
Restricted business operations means business operations in
Sudan that include power production activities, mineral extraction
activities, oil-related activities, or the production of military
equipment, as those terms are defined in the Sudan Accountability
and Divestment Act of 2007 (Pub. L. 110-174). Restricted business
operations do not include business operations that the person
conducting the business can demonstrate--
(1) Are conducted under contract directly and exclusively with
the regional government of southern Sudan;
(2) Are conducted pursuant to specific authorization from the
Office of Foreign Assets Control in the Department of the Treasury,
or are expressly exempted under Federal law from the requirement to
be conducted under such authorization;
(3) Consist of providing goods or services to marginalized
populations of Sudan;
(4) Consist of providing goods or services to an internationally
recognized peacekeeping force or humanitarian organization;
(5) Consist of providing goods or services that are used only to
promote health or education; or
(6) Have been voluntarily suspended.
* * * * *
(b)(1) Annual Representations and Certifications. Any changes
provided by the offeror in paragraph (b)(2) of this provision do not
automatically change the representations and certifications posted
on the Online Representations and Certifications Application (ORCA)
website.
(2) The offeror has completed the annual representations and
certifications electronically via the ORCA website at http://orca.bpn.gov. After reviewing the ORCA database information, the
offeror verifies by submission of this offer that the
representations and certifications currently posted electronically
at FAR 52.212-3, Offeror Representations and Certifications--
Commercial Items, have been entered or updated in the last 12
months, are current, accurate, complete, and applicable to this
solicitation (including the business size standard applicable to the
NAICS code referenced for this solicitation), as of the date of this
offer and are incorporated in this offer by reference (see FAR
4.1201), except for paragraphs ----------.
[Offeror to identify the applicable paragraphs at (c) through
(m) of this provision that the offeror has completed for the
purposes of this solicitation only, if any.
These amended representation(s) and/or certification(s) are also
incorporated in this offer and are current, accurate, and complete
as of the date of this offer.
Any changes provided by the offeror are applicable to this
solicitation only, and do not result in an update to the
representations and certifications posted on ORCA.]
* * * * *
(l) Taxpayer Identification Number (TIN) (26 U.S.C. 6109, 31
U.S.C. 7701). (Not applicable if the offeror is required to provide
this information to a central contractor registration database to be
eligible for award.)
(1) All offerors must submit the information required in
paragraphs (l)(3) through (l)(5) of this provision to comply with
debt collection requirements of 31 U.S.C. 7701(c) and 3325(d),
reporting requirements of 26 U.S.C. 6041, 6041A, and 6050M, and
implementing regulations issued by the Internal Revenue Service
(IRS).
(2) The TIN may be used by the Government to collect and report
on any delinquent amounts arising out of the offeror's relationship
with the Government (31 U.S.C. 7701(c)(3)). If the resulting
contract is subject to the payment reporting requirements described
in FAR 4.904, the TIN provided hereunder may be matched with IRS
records to verify the accuracy of the offeror's TIN.
(3) Taxpayer Identification Number (TIN).
[ballot] TIN: --------------------.
[ballot] TIN has been applied for.
[ballot] TIN is not required because:
[ballot] Offeror is a nonresident alien, foreign corporation, or
foreign partnership that does not have income effectively connected
with the conduct of a trade or business in the United States and
does not have an office or place of business or a fiscal paying
agent in the United States;
[ballot] Offeror is an agency or instrumentality of a foreign
government;
[ballot] Offeror is an agency or instrumentality of the Federal
Government.
(4) Type of organization.
[ballot] Sole proprietorship;
[ballot] Partnership;
[ballot] Corporate entity (not tax-exempt);
[ballot] Corporate entity (tax-exempt);
[ballot] Government entity (Federal, State, or local);
[ballot] Foreign government;
[ballot] International organization per 26 CFR 1.6049-4;
[ballot] Other ----------.
(5) Common parent.
[ballot] Offeror is not owned or controlled by a common parent;
[ballot] Name and TIN of common parent:
Name --------------------.
TIN --------------------.
(m) Restricted business operations in Sudan. By submission of
its offer, the offeror certifies that it does not conduct any
restricted business operations in Sudan.
(End of provision)
0
10. Amend section 52.212-5 by revising the date of the clause and
paragraph (b)(31) to read as follows:
52.212-5 Contract Terms and Conditions Required to Implement Statutes
or Executive Orders--Commercial Items.
* * * * *
CONTRACT TERMS AND CONDITIONS REQUIRED TO IMPLEMENT STATUTES OR
EXECUTIVE ORDERS--COMMERCIAL ITEMS (JUN 2008)
* * * * *
[[Page 33640]]
(b) * * *
---- (31) 52.225-13, Restrictions on Certain Foreign Purchases
(JUN 2008) (E.O.'s, proclamations, and statutes administered by the
Office of Foreign Assets Control of the Department of the Treasury).
* * * * *
0
11. Amend section 52.225-13 by--
0
a. Revising the date of the clause; and
0
b. Removing from paragraph (b) ``from North Korea'' and adding ``from
Burma or North Korea'' in its place;
52.225-13 Restrictions on Certain Foreign Purchases.
* * * * *
RESTRICTIONS ON CERTAIN FOREIGN PURCHASES (JUN 2008)
* * * * *
0
12. Add section 52.225-20 to read as follows:
52.225-20 Prohibition on Conducting Restricted Business Operations in
Sudan--Certification.
As prescribed at 25.1103(d), insert the following provision:
PROHIBITION ON CONDUCTING RESTRICTED BUSINESS OPERATIONS IN
SUDAN--CERTIFICATION (JUN 2008)
(a) Definitions. As used in this provision--
Business operations means engaging in commerce in any form,
including by acquiring, developing, maintaining, owning, selling,
possessing, leasing, or operating equipment, facilities, personnel,
products, services, personal property, real property, or any other
apparatus of business or commerce.
Marginalized populations of Sudan means--
(1) Adversely affected groups in regions authorized to receive
assistance under section 8(c) of the Darfur Peace and Accountability
Act (Pub. L. 109-344) (50 U.S.C. 1701 note); and
(2) Marginalized areas in Northern Sudan described in section
4(9) of such Act.
Person means--
(1) A Natural person, corporation, company, business
association, partnership, society, trust, any other nongovernmental
entity, organization, or group;
(2) Any governmental entity or instrumentality of a government,
including a multilateral development institution (as defined in
section 1701(c)(3) of the International Financial Institutions Act
(22 U.S.C. 262r(c)(3)); and
(3) Any successor, subunit, parent company or subsidiary of any
entity described in paragraphs (1) or (2) of this definition.
Restricted business operations means business operations in
Sudan that include power production activities, mineral extraction
activities, oil-related activities, or the production of military
equipment, as those terms are defined in the Sudan Accountability
and Divestment Act of 2007 (Pub. L. 110-174). Restricted business
operations do not include business operations that the person
conducting the business can demonstrate--
(1) Are conducted under contract directly and exclusively with
the regional government of southern Sudan;
(2) Are conducted pursuant to specific authorization from the
Office of Foreign Assets Control in the Department of the Treasury,
or are expressly exempted under Federal law from the requirement to
be conducted under such authorization;
(3) Consist of providing goods or services to marginalized
populations of Sudan;
(4) Consist of providing goods or services to an internationally
recognized peacekeeping force or humanitarian organization;
(5) Consist of providing goods or services that are used only to
promote health or education; or
(6) Have been voluntarily suspended.
(b) Certification. By submission of its offer, the offeror
certifies that it does not conduct any restricted business
operations in Sudan.
(End of provision)
[FR Doc. E8-13154 Filed 6-11-08; 8:45 am]
BILLING CODE 6820-EP-S