[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: 48CFR9.405-2]

[Page 154]
 
            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM
 
                CHAPTER 1--FEDERAL ACQUISITION REGULATION
 
PART 9_CONTRACTOR QUALIFICATIONS--Table of Contents
 
          Subpart 9.4_Debarment, Suspension, and Ineligibility
 
Sec.  9.405-2  Restrictions on subcontracting.

    (a) When a contractor debarred, suspended, or proposed for debarment 
is proposed as a subcontractor for any subcontract subject to Government 
consent (see subpart 44.2), contracting officers shall not consent to 
subcontracts with such contractors unless the agency head or a designee 
states in writing the compelling reasons for this approval action. (See 
9.405(b) concerning declarations of ineligibility affecting 
subcontracting.)
    (b) The Government suspends or debars contractors to protect the 
Government's interests. By operation of the clause at 52.209-6, 
Protecting the Government's Interests When Subcontracting with 
Contractors Debarred, Suspended or Proposed for Debarment, contractors 
shall not enter into any subcontract in excess of $25,000 with a 
contractor that has been debarred, suspended, or proposed for debarment 
unless there is a compelling reason to do so. If a contractor intends to 
subcontract with a party that is debarred, suspended, or proposed for 
debarment as evidenced by the party's inclusion on the List of Parties 
Excluded from Federal Procurement and Nonprocurement Programs (see 
9.404), a corporate officer or designee of the contractor is required by 
operation of the clause at 52.209-6, Protecting the Government's 
Interests when Subcontracting with Contractors Debarred, Suspended, or 
Proposed for Debarment, to notify the contracting officer, in writing, 
before entering into such subcontract. The notice must provide the 
following:
    (1) The name of the subcontractor;
    (2) The contractor's knowledge of the reasons for the subcontractor 
being on the List of Parties Excluded from Federal Procurement and 
Nonprocurement Programs;
    (3) The compelling reason(s) for doing business with the 
subcontractor notwithstanding its inclusion on the List of Parties 
Excluded from Federal Procurement and Nonprocurement Programs; and
    (4) The systems and procedures the contractor has established to 
ensure that it is fully protecting the Government's interests when 
dealing with such subcontractor in view of the specific basis for the 
party's debarment, suspension, or proposed debarment.
    (c) The contractor's compliance with the requirements of 52.209-6 
will be reviewed during Contractor Purchasing System Reviews (see 
subpart 44.3).

[54 FR 19815, May 8, 1989, as amended at 56 FR 29127, June 25, 1991; 59 
FR 67033, Dec. 28, 1994; 60 FR 33066, June 26, 1995; 60 FR 48237, Sept. 
18, 1995]

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