[Code of Federal Regulations]
[Title 15, Volume 2]
[Revised as of January 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 15CFR700.51]

[Page 92-93]
 
                  TITLE 15--COMMERCE AND FOREIGN TRADE
 
  CHAPTER VII--BUREAU OF INDUSTRY AND SECURITY, DEPARTMENT OF COMMERCE
 
PART 700_DEFENSE PRIORITIES AND ALLOCATIONS SYSTEM--Table of Contents
 
                 Subpart H_Special Priorities Assistance
 
Sec.  700.51  Requests for priority rating authority.

    (a) If a rated order is likely to be delayed because a person is 
unable to obtain items not normally rated under this regulation, the 
person may request the authority to use a priority rating in ordering 
the needed items. Examples of items for which priority ratings can be 
authorized include:
    (1) Production or construction equipment;
    (2) Computers when not used as production items; and
    (3) Expansion, rebuilding or replacing plant facilities.
    (b) Rating authority for production or construction equipment. (1) A 
request for priority rating authority for production or construction 
equipment must be submitted to the appropriate Delegate Agency. The 
Delegate Agency may establish particular forms to be used for these 
requests (e.g., Department of Defense Form DD 691.)
    (2) When the use of a priority rating is authorized for the 
procurement of production or construction equipment,

[[Page 93]]

a rated order may be used either to purchase or to lease such equipment. 
However, in the latter case, the equipment may be leased only from a 
person engaged in the business of leasing such equipment or from a 
person willing to lease rather than sell.
    (c) Rating authority in advance of a rated prime contract. (1) In 
certain cases and upon specific request, Commerce, in order to promote 
the national defense, may authorize a person to place a priority rating 
on an order to a supplier in advance of the issuance of a rated prime 
contract. In these instances, the person requesting advance rating 
authority must obtain sponsorship of the request from the appropriate 
Delegate Agency. The person shall also assume any business risk 
associated with the placing of rated orders if these orders have to be 
cancelled in the event the rated prime contract is not issued.
    (2) The person must state the following in the request:

    It is understood that the authorization of a priority rating in 
advance of our receiving a rated prime contract from a Delegate Agency 
and our use of that priority rating with our suppliers in no way commits 
the Delegate Agency, the Department of Commerce or any other government 
agency to enter into a contract or order or to expend funds. Further, we 
understand that the Federal Government shall not be liable for any 
cancellation charges, termination costs, or other damages that may 
accrue if a rated prime contract is not eventually placed and, as a 
result, we must subsequently cancel orders placed with the use of the 
priority rating authorized as a result of this request.

    (3) In reviewing requests for rating authority in advance of a rated 
prime contract, Commerce will consider, among other things, the 
following criteria:
    (i) The probability that the prime contract will be awarded;
    (ii) The impact of the resulting rated orders on suppliers and on 
other authorized programs;
    (iii) Whether the contractor is the sole source;
    (iv) Whether the item being produced has a long lead time;
    (v) The political sensitivity of the project; and
    (vi) The time period for which the rating is being requested.
    (4) Commerce may require periodic reports on the use of the rating 
authority granted under paragraph (c) of this section.
    (5) If a rated prime contract is not issued, the person shall 
promptly notify all suppliers who have received rated orders pursuant to 
the advanced rating authority that the priority rating on those orders 
is cancelled.