[Federal Register Volume 79, Number 120 (Monday, June 23, 2014)]
[Proposed Rules]
[Pages 35507-35509]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-14590]
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DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System
48 CFR Part 252
RIN 0750-AI30
Defense Federal Acquisition Regulation Supplement: Flowdown of
Specialty Metals Restrictions (DFARS Case 2014-D011)
AGENCY: Defense Acquisition Regulations System, Department of Defense
(DoD).
ACTION: Proposed rule.
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SUMMARY: DoD is proposing to amend the Defense Federal Acquisition
Regulation Supplement (DFARS) to clarify the flowdown requirements for
the DFARS clause entitled ``Restriction on Acquisition of Certain
Articles Containing Specialty Metals.''
DATES: Comment date: Comments on the proposed rule should be submitted
in writing to the address shown below on or before August 22, 2014, to
be considered in the formation of a final rule.
ADDRESSES: Submit comments identified by DFARS Case 2014-D011, using
any of the following methods:
[cir] Regulations.gov: http://www.regulations.gov. Submit comments
via the Federal eRulemaking portal by entering ``DFARS Case 2014-D011''
under the heading ``Enter keyword or ID'' and selecting ``Search.''
Select the link ``Submit a Comment'' that corresponds with ``DFARS Case
2014-D011.'' Follow the instructions provided at the ``Submit a
Comment'' screen. Please include your name, company name (if any), and
``DFARS Case 2014-D011'' on your attached document.
[cir] Email: [email protected]. Include DFARS Case 2014-D011 in
the subject line of the message.
[cir] Fax: 571-372-6094.
[cir] Mail: Defense Acquisition Regulations System, Attn: Ms. Amy
G. Williams, OUSD(AT&L)DPAP/DARS, Room 3B941, 3060 Defense Pentagon,
Washington, DC 20301-3060.
Comments received generally will be posted without change to http://www.regulations.gov, including any personal information provided. To
confirm receipt of your comment(s), please check www.regulations.gov,
approximately two to three days after submission to verify posting
(except allow 30 days for posting of comments submitted by mail).
FOR FURTHER INFORMATION CONTACT: Ms. Amy G. Williams, Defense
Acquisition Regulations System, OUSD(AT&L)DPAP/DARS, Room 3B941, 3060
Defense Pentagon, Washington, DC 20301-3060. Telephone 571-372-6106.
SUPPLEMENTARY INFORMATION:
I. Background
The clause at DFARS 252.225-7009, Restriction on Acquisition of
Certain Articles Containing Specialty Metals, as prescribed at DFARS
225.7003-5(a)(2), implements 10 U.S.C. 2533b. This clause is used in
solicitations and contracts, including solicitations and contracts
using FAR part 12 procedures for the acquisition of commercial items,
that exceed the simplified acquisition threshold and require the
delivery of the following items, if such items contain specialty
metals: Aircraft, missile or space systems, ships, tank or automotive
systems, weapon systems, or ammunition, and components thereof. Except
as provided in paragraph (c) of the clause, any specialty metals
incorporated in items delivered under the contract shall be melted or
produced
[[Page 35508]]
in the United States, its outlying areas, or a qualifying country.
DoD is proposing to revise paragraph (e) of this clause to clarify
the requirement to flow this clause down to subcontracts.
II. Discussion and Analysis
In order to prevent misinterpretation of the current flowdown
requirement to insert the ``substance of the clause'' in subcontracts,
the flowdown requirement has been rewritten to specify that the only
modifications allowed when flowing down the clause are as follows:
Exclude and reserve paragraph (d) of the clause.
Modify paragraph (c)(6) of the clause only as necessary to
facilitate management of the allowance for up to 2 percent otherwise
noncompliant specialty metal content in the end product, while
recognizing that the minimal content exception does not apply to
specialty metals contained in high-performance magnets.
Not further alter the clause, other than to identify the
appropriate parties.
III. Executive Orders 12866 and 13563
Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess
all costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). E.O.
13563 emphasizes the importance of quantifying both costs and benefits,
of reducing costs, of harmonizing rules, and of promoting flexibility.
This is not a significant regulatory action and, therefore, was not
subject to review under section 6(b) of E.O. 12866, Regulatory Planning
and Review, dated September 30, 1993. This rule is not a major rule
under 5 U.S.C. 804.
IV. Regulatory Flexibility Act
DoD does not expect this rule 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 it is a
clarification of an existing requirement. However, an initial
regulatory flexibility analysis has been performed and is summarized as
follows:
The reason for issuance of this proposed rule is to clarify the
flowdown requirements for DFARS clause 252.225-7009, Restriction on
Acquisition of Certain Articles Containing Specialty Metals.
The objective of the rule is to more fully implement the
requirements of 10 U.S.C. 2533b, which restricts the acquisition of
specialty metals not melted in the United States, its outlying areas,
or a qualifying country, in order to strengthen the United States
industrial base.
This rule applies to DoD contractors and subcontractors that are
providing aircraft, missile or space systems, ships, tank or automotive
items, weapon systems, ammunition, or components thereof that contain
specialty metals.
Based on FY 2013 data in the Federal Procurement Data System
(FPDS), DoD awarded 1,566 contracts that exceeded the simplified
acquisition threshold for aircraft, missile or space systems, ships,
tank or automotive items, weapon systems, ammunition, or components
thereof. Of those awards, 642 were to 533 unique small business
entities. FPDS does not contain data on subcontracts. If we estimate an
average of 20 subcontracts per contract for items containing specialty
metals, and that 35 percent of those subcontracts are awarded to small
businesses, 2 subcontracts per small entity, then this rule may apply
to approximately 6,123 small business entities subject to DFARS 52.225-
7009.
(1,566 x 20 = 31,320 x .35 = 10,962 x .5 = 5,481 small business
subcontractors + 642 small business prime contractors = 6,123)
There are no reporting or recordkeeping requirements associated
with this rule. With some exceptions, the rule requires contractors to
provide certain end products containing specialty metals melted or
produced in the United States, its outlying areas, or a qualifying
country. However, end items may contain a minimal amount of otherwise
noncompliant specialty metals, if the total weight of such noncompliant
metals does not exceed 2 percent of the total of all specialty metals
in the end item. Therefore, the contractor has some discretion in
flowing down the requirement to subcontractors to the extent necessary
to ensure compliance of the end products the contractor will deliver to
the Government.
The rule does not duplicate, overlap, or conflict with any other
Federal rules.
DoD did not identify any alternatives to this rule that would
reduce burdens on small entities and meet the objective of the rule.
This rule does not impose any significant new burdens on small
entities, because it only clarifies what was intended by the
conventional statement to insert ``the substance of the clause'' in
subcontracts for items containing specialty metals.
DoD invites comments from small business concerns and other
interested parties on the expected impact of this rule on small
entities.
DoD will also consider comments from small entities concerning the
existing regulations in subparts affected by this rule in accordance
with 5 U.S.C. 610. Interested parties must submit such comments
separately and should cite 5 U.S.C 610 (DFARS Case 2014-D011), in
correspondence.
V. Paperwork Reduction Act
The rule does not contain any information collection requirements
that require the approval of the Office of Management and Budget under
the Paperwork Reduction Act (44 U.S.C. chapter 35).
List of Subjects in 48 CFR Part 252
Government procurement.
Amy G. Williams,
Deputy, Defense Acquisition Regulations System.
Therefore, 48 CFR part 252 is proposed to be amended as follows:
PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
0
1. The authority citation for 48 CFR part 252 continues to read as
follows:
Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.
0
2. Amend section 252.225-7009 by--
0
a. Removing the clause date ``(JUN 2013)'' and adding ``(DATE)'' in its
place; and
0
b. Revising paragraph (e) to read as follows:
252.225-7009 Restriction on Acquisition of Certain Articles Containing
Specialty Metals
* * * * *
(e) Subcontracts.
(1) The Contractor shall exclude and reserve paragraph (d) and this
paragraph (e)(1) when flowing down this clause to subcontracts.
(2) The Contractor shall insert paragraphs (a) through (c) and this
paragraph (e)(2) of this clause in subcontracts, including subcontracts
for commercial items, that are for items containing specialty metals to
ensure compliance of the end products that the Contractor will deliver
to the Government. When inserting this clause in subcontracts, the
Contractor shall--
(i) Modify paragraph (c)(6) of this clause only as necessary to
facilitate management of the minimal content
[[Page 35509]]
exception at the prime contract level. The minimal content exception
does not apply to specialty metals contained in high-performance
magnets; and
(ii) Not further alter the clause other than to identify the
appropriate parties.
[FR Doc. 2014-14590 Filed 6-20-14; 8:45 am]
BILLING CODE 5001-06-P