[Federal Register: September 28, 2006 (Volume 71, Number 188)]
[Rules and Regulations]
[Page 57378-57379]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr28se06-28]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Part 25
[FAC 2005-13; FAR Case 2005-022; Item VII;Docket 2006-0020, Sequence
14]
RIN 9000-AK34
Federal Acquisition Regulation; FAR Case 2005-022, Exception to
the Buy American Act for Commercial Information Technology
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Final rule.
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SUMMARY: The Civilian Agency Acquisition Council and the Defense
Acquisition Regulations Council (Councils) have agreed to convert to a
final rule without change, an interim rule amending the Federal
Acquisition
[[Page 57379]]
Regulation (FAR) to implement Section 535(a) of Division F of the
Consolidated Appropriations Act, 2004, and similar sections in
subsequent appropriations acts. Section 535(a) authorizes an exception
to the Buy American Act for acquisitions of information technology that
are commercial items.
DATES: Effective Date: September 28, 2006.
FOR FURTHER INFORMATION CONTACT For clarification of content, contact
Mr. Jeremy Olson, at (202) 501-3221. Please cite FAC 2005-13, FAR case
2005-022. For information pertaining to status or publication
schedules, contact the FAR Secretariat at (202) 501-4755.
SUPPLEMENTARY INFORMATION:
A. Background
This final rule amends the Federal Acquisition Regulation to
implement annual appropriations act provisions that exempt acquisitions
of information technology that are commercial items from the Buy
American Act, including--
Section 535(a) of Division F, Consolidated Appropriations
Act, 2004 (Pub. L. 108-199);
Section 517 of Division H, Title V of the Consolidated
Appropriations Act, 2005 (Pub. L. 108-447); and
Section 717 of Division A, Transportation, Treasury,
Housing and Urban Development, the Judiciary, the District of Columbia,
and Independent Agencies Appropriations Act, 2006 (Pub. L. 109-115).
This exception was initially implemented through deviations by the
individual agencies, until it became clear that it was not just for one
year. The Councils now expect this exception to continue to appear in
future appropriations acts. If the exception does not appear in a
future appropriations act, the Councils will promptly change the FAR to
limit applicability of the exception to the fiscal years to which it
applies. DoD, GSA, and NASA published an interim rule in the Federal
Register at 71 FR 223, January 3, 2006 and the public comment period
closed on March 6, 2006.
Public comments. The Councils addressed the two public comments as
follows:
Agree with rule
One respondent concurs with the rule as written. The respondent
views this rule as a positive first step in recognizing the
Government's need for quicker, cheaper access to commercial-off-the-
shelf information technology.
Response: None required.
Rule should not apply to DoD
The other respondent believes that the exception should not apply
to DoD due to the security risk associated with foreign entities
potentially gaining access to DoD information systems.
Response: This rule implements statute. The statutes that the
Councils are implementing do not exempt DoD. Each fiscal year statute
states that the restrictions of the Buy American Act shall not apply to
the acquisition by the Federal Government of information technology
that is a commercial item.
Although DoD uses DoD-unique Buy American Act/Free Trade Agreement
provisions and clauses, this exception has already been implemented by
DoD for Fiscal Years 2004 through 2006 by class deviations signed by
the Director of Defense Procurement and Acquisition Policy (2004-O0003,
2005-O0004, 2005-O0010).
Regardless of the applicability of the Buy American Act, Defense
FAR Supplement (DFARS) Subpart 239.71, Security and Privacy for
Computer Systems, requires defense agencies to ensure that information
assurance is provided for information technology in accordance with
current policies, procedures, and statutes.
This is not a significant regulatory action and, therefore, was not
subject to review under Section 6(b) of Executive Order 12866,
Regulatory Planning and Review, dated September 30, 1993. This rule is
not a major rule under 5 U.S.C. 804.
B. Regulatory Flexibility Act
The Regulatory Flexibility Act, 5 U.S.C. 601, et seq., applies to
this final rule. The Councils prepared a Final Regulatory Flexibility
Analysis (FRFA), and it is summarized as follows:
The objective of this rule is to promote Government access to
commercial information technology. As a result of this exception,
the Buy American Act will no longer apply to acquisitions of
commercial information technology. The Free Trade Agreement non-
discriminatory provisions are no longer necessary, since all
products will be treated without the restrictions of the Buy
American Act. The final rule applies to all offerors responding to
solicitations for commercial information technology where the Buy
American Act previously applied (generally, acquisitions between the
micro-purchase threshold and $193,000). This impact analysis does
not include the Department of Defense, which applies this exception
to DoD-unique Buy American Act/Free Trade Agreement provisions and
clauses under a separate case (DFARS Case 2005-D011). This exception
will allow small entities to compete without meeting the Buy
American Act domestic end product requirements.
It is anticipated that small business concerns will continue to
receive the same number of awards in the range of the micro-purchase
threshold to $100,000, because these awards are generally set-aside
for small business concerns. It is also expected that small business
concerns will continue to receive awards in the range of $100,000 to
$193,000, but in this range they will face competition from foreign
end products.
This rule will not have an effect on small businesses affected
by the ``non-manufacturer rule,'' which means that a contractor
under a small business set-aside or 8(a) contract shall be a small
business under the applicable size standard and shall provide either
its own product or that of another domestic small business
manufacturing or processing concern. If there is a small business
set-aside, and there is no SBA waiver of the nonmanufacturer rule,
then FAR 52.219-6(c) and/or FAR 52.219-18(d) require that a domestic
product must be furnished. In this case, the rule will have no
effect on small businesses because the nonmanufacturer rule is not
changed. If SBA did waive the nonmanufacturer rule, then there is no
requirement to purchase a domestic product but an evaluation
preference would apply. The rule could have an impact on small
businesses when there is no small business set-aside because small
businesses may lose the evaluation preference for acquisitions
between $25,000 and $193,000.
Interested parties may obtain a copy of the FRFA from the FAR
Secretariat. The FAR Secretariat has submitted a copy of the FRFA to
the Chief Counsel for Advocacy of the Small Business Administration.
C. Paperwork Reduction Act
The Paperwork Reduction Act does apply because the changes to the
FAR will slightly reduce the information collection requirements
currently approved by the Office of Management and Budget OMB
Clearances 9000-0024 and 9000-0130. We estimate a reduction of
approximately 300 hours to OMB Clearance 9000-0024 and 50 hours to
9000-0130.
List of Subjects in 48 CFR Part 25
Government procurement.
Dated: September 19, 2006.
Ralph De Stefano,
Director, Contract Policy Division.
Interim Rule Adopted as Final Without Change
0
Accordingly, the interim rule amending 48 CFR part 25, which was
published in the Federal Register at 71 FR 223, January 3, 2006, is
adopted as a final rule without change.
[FR Doc. 06-8217 Filed 9-27-06; 8:45 am]
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