[Code of Federal Regulations]
[Title 48, Volume 5]
[Revised as of October 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 48CFR970.0404-2]

[Page 427-428]
 
            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM
 
                     CHAPTER 9--DEPARTMENT OF ENERGY
 
Sec. 970.0404-2  General.

    (a) Guidance regarding the National Industrial Security Program as 
implemented by the Department of Energy may be found at 904.4, 
Safeguarding Classified Information Within Industry. Additional 
information concerning contractor ownership when national security or 
atomic energy information is involved may be found at 904.70. 
Information regarding contractor ownership involving national security 
program contracts may be found at 904.71.
    (b) Executive Order 12333, United States Intelligence Activities, 
provides for the organization and control of United States foreign 
intelligence and counterintelligence activities. DOE has established a 
counterintelligence program subject to this Executive Order which is 
described in DOE Order 5670.3 (as amended). All DOE elements, including 
management and operating contractors and other contractors managing DOE-
owned facilities which require access authorizations, should undertake 
the necessary precautions to ensure that DOE and covered Contractor 
personnel, programs and resources are properly protected from foreign 
intelligence threats and activities.
    (c) For DOE management and operating contracts and other contracts 
designated by the Procurement Executive, or designee, the clause 
entitled, ``Conditional Payment of Fee, Profit, and Other Incentives--
Facility Management Contracts,'' implements the requirements of section 
234B of the Atomic Energy Act (see 48 CFR 904.402(c)(1)) for the use of 
a contract clause that provides for an appropriate reduction in the fee 
or amount paid to the contractor under the contract in the event of a 
violation by the contractor or any contractor employee of any rule, 
regulation, or order relating to the safeguarding or security of 
Restricted Data or other classified information. The clause, in part, 
provides for reductions in the amount of fee, profit, or share of cost 
savings that is

[[Page 428]]

otherwise earned by the contractor for performance failures relating to 
the safeguarding of Restricted Data and other classified information.

[67 FR 14878, Mar. 28, 2002, as amended at 68 FR 68781, Dec. 10, 2003]