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Four Final Rules in FAC 2005-58 Amend the FAR

The Civilian Agency Acquisition and Defense Acquisition Regulations councils have issued Federal Acquisition Circular 2005-58, which contains four final rules amending the Federal Acquisition Regulation. In order of appearance, the rules are: Item I --Biobased Procurements (FAR Case 2010-004); Item II --Representation Regarding Export of Sensitive Technology to Iran (FAR Case 2010-018); and Item III --Justification and Approval of Sole-Source 8(a) Contracts (FAR Case 2009-038). Item IV makes technical amendments. This FAC also contains a Small Entity Compliance Guide. A full listing of the regulations impacted by the rules, along with the effective date for each rule, appears in the FAC regulation table below. For the text of FAC 2005-58, see ¶70,002.147.

Biobased Purchases

The FAR Case 2010-004 final rule amends the FAR to implement Section 9002 of the Farm Security and Rural Investment Act of 2002, as amended by the Food, Conservation, and Energy Act of 2008 (PL 110-246). The changes to the FSRIA require contractors to report biobased products purchased under service and construction contracts. This reporting will enable agencies to monitor compliance with the federal preference for biobased products. The rule revises the definition of "biobased product" at FAR 2.101 ; adds a prohibition at FAR 11.302 against agencies collecting more data than typically would be provided by other entities (other than data confirming the biobased content); and amends the clause at FAR 52.223-2, Affirmative Procurement of Biobased Products Under Service and Construction Contracts, to require annual reporting by the contractor of the types and dollar value of any Department of Agriculture-designated biobased products purchased during the preceding fiscal year on the contract. Further, the rule updates references at FAR 23.401, FAR 23.405, FAR 23.406, and FAR 52.223-1 to the USDA's BioPreferred Program, to conform to USDA's relocation of the program's rules (see 76 FR 53631), and updates FAR 23.404 (b)(2) and FAR 52.223-2 (a)(2) to conform to USDA's blanket exemption for all USDA-designated biobased items from the Biopreferred Program's requirements for procurements involving combat or combat-related missions and for spacecraft systems and launch support equipment. Contractors may need to create an inventory management system to track the biobased products purchased for each contract. However, the FAR Councils believe this rule may enhance small business biobased product suppliers' participation in this market. See ¶70,006.255 for the proposed rule.

Iran Representation

In FAR Case 2010-018, the interim rule issued in FAC 2005-54 has been finalized with a minor change. The interim rule added a representation to implement Section 106 of the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 (PL 111-195), which imposed a procurement prohibition on contracts with persons that export certain sensitive technology to Iran. To further implement Section 106, the interim rule added, at FAR 25.703-3 (b), a requirement for a representation that the offeror does not export any sensitive technology to the government of Iran or any entities or individuals controlled by the government of Iran. The waiver procedure at FAR 25.703-2 (d) was moved to FAR 25.703-4 so that waiver of Section 106 could be addressed along with the procedures for waiver of Section 102. The representation that the offeror does not export sensitive technology to Iran was incorporated into the certification at FAR 52.225-25, titled "Prohibition on Contracting with Entities Engaging in Sanctioned Activities Relating to Iran --Representation and Certification," to include the representation and to clarify that the prohibition is against contracting with sanctioned entities. FAR 52.225-25 included the statutory definition of "sensitive technology" and a Department of State e-mail address where offerors can refer questions concerning sensitive technology before making the representation. This representation requirement also applies to the acquisition of commercial items pursuant to a change to FAR 52.212-3, Offeror Representations and Certifications --Commercial Items. Offerors will be able to make an annual certification through the Online Representations and Certifications Application if the offeror is registered in the Central Contractor Registration database. Therefore, conforming changes were made to FAR Part 4 and the clause at FAR 52.204-8, Annual Representations and Certifications. The final rule makes an editorial change to the introductory text of FAR 25.703-1.

8(a) Sole-Source Contracts

In addition, the interim rule in FAR Case 2009-038 has been finalized without change. The rule, issued with FAC 2005-50, amended the FAR to implement Section 811 of the National Defense Authorization Act for Fiscal Year 2010 (PL 111-84). Section 811 requires agencies to maximize the effective use of competition by making certain that the proper justification and approval is obtained prior to award of 8(a) sole-source contracts over $20 million. The interim rule added cross references at FAR 6.204, FAR 6.302-5, and FAR 19.808-1 to the requirement for a J&A; amended FAR 6.302-5, which sets forth situations in which other than full-and-open competition is authorized or required by statute, to clarify that, while 8(a) sole-source awards are still authorized, they now must be supported by a J&A prior to award when the total estimated contract amount is over $20 million; amended FAR 6.303-1 (b) to require the J&A to be approved by the appropriate official and made public after award; amended FAR 6.303-2 to list the 5 required elements for the sole-source 8(a) J&A; and revised FAR 19.808-1 to inform contracting officers that the Small Business Administration may not accept for negotiation a sole-source 8(a) contract over $20 million unless the requesting agency has completed a J&A in accordance with the requirements at FAR 6.303. The interim rule also made corresponding technical amendments at FAR 6.304 and FAR 15.607.

(The news featured above is a selection from the news covered in the Government Contracts Report Letter, which is published weekly and distributed to subscribers of the Government Contracts Reporter. )

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