[Code of Federal Regulations]
[Title 48, Volume 1]
[Revised as of October 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 48CFR3.104-7]

[Page 47-48]
 
            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM
 
                CHAPTER 1--FEDERAL ACQUISITION REGULATION
 
PART 3_IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST--Table of Contents
 
                         Subpart 3.1_Safeguards
 
Sec.  3.104-7  Violations or possible violations.

    (a) A contracting officer who receives or obtains information of a 
violation or possible violation of subsection 27(a), (b), (c), or (d) of 
the Act (see 3.104-3) must determine if the reported violation or 
possible violation has any impact on the pending award or selection of 
the contractor.
    (1) If the contracting officer concludes that there is no impact on 
the procurement, the contracting officer must forward the information 
concerning the violation or possible violation and documentation 
supporting a determination that there is no impact on the procurement to 
an individual designated in accordance with agency procedures.
    (i) If that individual concurs, the contracting officer may proceed 
with the procurement.
    (ii) If that individual does not concur, the individual must 
promptly forward the information and documentation to the HCA and advise 
the contracting officer to withhold award.
    (2) If the contracting officer concludes that the violation or 
possible violation impacts the procurement, the contracting officer must 
promptly forward the information to the HCA.
    (b) The HCA must review all information available and, in accordance 
with agency procedures, take appropriate action, such as--
    (1) Advise the contracting officer to continue with the procurement;

[[Page 48]]

    (2) Begin an investigation;
    (3) Refer the information disclosed to appropriate criminal 
investigative agencies;
    (4) Conclude that a violation occurred; or
    (5) Recommend that the agency head determine that the contractor, or 
someone acting for the contractor, has engaged in conduct constituting 
an offense punishable under subsection 27(e) of the Act, for the purpose 
of voiding or rescinding the contract.
    (c) Before concluding that an offeror, contractor, or person has 
violated the Act, the HCA may consider that the interests of the 
Government are best served by requesting information from appropriate 
parties regarding the violation or possible violation.
    (d) If the HCA concludes that section 27 of the Act has been 
violated, the HCA may direct the contracting officer to--
    (1) If a contract has not been awarded--
    (i) Cancel the procurement;
    (ii) Disqualify an offeror; or
    (iii) Take any other appropriate actions in the interests of the 
Government.
    (2) If a contract has been awarded--
    (i) Effect appropriate contractual remedies, including profit 
recapture under the clause at 52.203-10, Price or Fee Adjustment for 
Illegal or Improper Activity, or, if the contract has been rescinded 
under paragraph(d)(2)(ii) of this subsection, recovery of the amount 
expended under the contract;
    (ii) Void or rescind the contract with respect to which--
    (A) The contractor or someone acting for the contractor has been 
convicted for an offense where the conduct constitutes a violation of 
subsection 27(a) or (b) of the Act for the purpose of either--
    (1) Exchanging the information covered by the subsections for 
anything of value; or
    (2) Obtaining or giving anyone a competitive advantage in the award 
of a Federal agency procurement contract; or
    (B) The agency head has determined, based upon a preponderance of 
the evidence, that the contractor or someone acting for the contractor 
has engaged in conduct constituting an offense punishable under 
subsection 27(e)(1) of the Act; or
    (iii) Take any other appropriate actions in the best interests of 
the Government.
    (3) Refer the matter to the agency suspending or debarring official.
    (e) The HCA should recommend or direct an administrative or 
contractual remedy commensurate with the severity and effect of the 
violation.
    (f) If the HCA determines that urgent and compelling circumstances 
justify an award, or award is otherwise in the interests of the 
Government, the HCA, in accordance with agency procedures, may authorize 
the contracting officer to award the contract or execute the contract 
modification after notifying the agency head.
    (g) The HCA may delegate his or her authority under this subsection 
to an individual at least one organizational level above the contracting 
officer and of General Officer, Flag, Senior Executive Service, or 
equivalent rank.

[67 FR 13059, Mar. 20, 2002]