[Federal Register: September 28, 2006 (Volume 71, Number 188)]
[Rules and Regulations]
[Page 57357-57360]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr28se06-22]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 5, 6, 8, 11, and 13
[FAC 2005-13; FAR Case 2005-037; Item I; Docket 2006-0020, Sequence 10]
RIN 9000-AK55
Federal Acquisition Regulation; FAR Case 2005-037, Implement OMB
Policy on the Use of Brand Name Specifications
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Interim rule with request for comments.
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SUMMARY: The Civilian Agency Acquisition Council and the Defense
Acquisition Regulations Council (Councils) have agreed to amend the
Federal Acquisition Regulation (FAR) to require agencies to publish on
the Governmentwide point of entry (GPE) or e-Buy the documentation
required by
[[Page 57358]]
the FAR to support the use of brand name specifications.
DATES: Effective Date: September 28, 2006.
Comment Date: Interested parties should submit written comments to
the FAR Secretariat on or before November 27, 2006 to be considered in
the formulation of a final rule.
ADDRESSES: Submit comments identified by FAC 2005-13, FAR case 2005-
037, by any of the following methods:
Federal eRulemaking Portal:
http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.regulations.gov. Search for this document at the
``Federal Acquisition Regulation'' agency and review the ``Document
Title'' column; click on the Document ID number. Click on ``Add
Comments''.
You may also search for any document using the ``Advanced search/
document search'' tab, selecting from the agency field ``Federal
Acquisition Regulation'', and typing the FAR case number in the keyword
field.
Fax: 202-501-4067.
Mail: General Services Administration, Regulatory
Secretariat (VIR), 1800 F Street, NW, Room 4035, ATTN: Laurieann
Duarte, Washington, DC 20405.
Instructions: Please submit comments only and cite FAC 2005-13, FAR
case 2005-037, in all correspondence related to this case. All comments
received will be posted without change to http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.regulations.gov,
including any personal and/or business confidential information
provided.
FOR FURTHER INFORMATION CONTACT For clarification of content, contact
Ms. Cecelia L. Davis, Procurement Analyst, at (202) 219-0202. Please
cite FAC 2005-13, FAR case 2005-037. For information pertaining to
status or publication schedules, contact the FAR Secretariat at (202)
501-4755.
SUPPLEMENTARY INFORMATION:
A. Background
On April 11, 2005, the Office of Management and Budget (OMB) issued
a memorandum on the use of brand name specifications to reinforce the
need to maintain vendor and technology neutral contract specifications.
To provide for maximum competition, solicitations should limit the use
of brand name specifications. As a general rule, contract
specifications should emphasize the necessary physical, functional, and
performance characteristics of a product - ;not brand names. OMB
encouraged agencies to take steps to mitigate brand name usage and
requested agencies to publicize the justification for use of brand name
with the contract solicitation. While the justifications are generally
available upon request, posting the brand name justifications will
improve the overall transparency of the acquisition process.
Contracting officers must be sensitive when dealing with proprietary
information when posting justifications. FAR 6.305 requires contracting
officers to carefully screen all justifications for contractor
proprietary information and remove such information before making
available to the public. Contracting officers are to adhere to the
exemptions on disclosure of information contained in the Freedom of
Information Act (5 U.S.C. 552) and the prohibitions against disclosure
in FAR 24.202 in determining the information that should be removed.
The OMB memorandum applies to all acquisitions exceeding $25,000
that use brand name specifications, including open market purchases,
purchases from the Federal Supply Schedules (FSS) program, and sole
source procurements. Contracting officers should not use other contract
vehicles instead of the FSS program when it is not in the best interest
of the Government to do so, just to circumvent the brand name posting
requirement.
To implement the OMB memorandum, the Councils are amending the FAR
to add a requirement to publish on the GPE or e-Buy the documentation
required by the FAR to support the use of brand name specifications.
The proposed changes require--
For brand name orders against the FSS program, posting to
e-Buy the documentation or justification required by FAR 8.405-6. The
rule also restricts the use of oral orders over $25,000 against the FSS
that contain brand specifications.
For non-FSS acquisitions, including simplified
acquisitions, posting to the Federal Business Opportunities website
(http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.fedbizopps.gov) the justification or documentation required by FAR
11.105.
OMB issued a second memorandum on April 17, 2006 to provide
additional implementation guidance to agencies when publicizing the
brand name justification which reflects the approach above. In response
to OMB's memoranda, agencies submitted several comments and questions
on the posting requirement and the requirement for the brand name
justifications. The questions and comments are summarized below and the
Councils invite interested parties to comment on these questions.
1. The OMB memorandum requires agencies to post the brand name
justification to e-Buy with the request for quotation (RFQ) when using
the FSS. However, some agencies use commercial companies such as FedBid
to post the RFQs for FSS purchases and FedBid posts the RFQ to
FedBizOpps instead of e-Buy. Should agencies be allowed to post the
brand name justification to FedBizOpps instead of e-Buy when they use
FedBid or another commercial company to post an RFQ for FSS purchases?
If an alternative posting solution is used, will OMB be able to obtain
a report on the use of these brand name justifications, if necessary?
2. The OMB memorandum requires agencies to post brand name
justifications for orders against the FSS but not for orders against
indefinite-delivery contracts including GWACS. Agencies can avoid the
posting requirement simply by purchasing on an indefinite-delivery
contract instead of the FSS. Should agencies be required to post brand
name justifications for orders against indefinite-delivery contracts?
If yes, where is the best place to post the justification?
3. Should agencies be required to post brand name justifications
for orders issued on the SmartBuy program and other strategic sourcing
vehicles?
4. Should agencies be required to post brand name justifications to
renew software license agreements that are required to receive software
updates?
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 interim rule is not expected 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 the rule
adds no new requirements for contractors. The rule requires agencies to
post documentation required by the FAR to the GPE or e-Buy. An Initial
Regulatory Flexibility Analysis (IRFA) has therefore not been prepared.
The Councils will consider comments from small entities concerning the
affected FAR Parts 5, 6, 8, 11, and 13 in accordance with 5 U.S.C. 610.
Interested parties must submit such comments separately and should cite
5 U.S.C 601, et seq. (FAC 2005-13, FAR case 2005-037), in
correspondence.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the changes to
the FAR do not impose information
[[Page 57359]]
collection requirements that require the approval of the Office of
Management and Budget under 44 U.S.C. 3501, et seq.
D. Determination to Issue an Interim Rule
A determination has been made under the authority of the Secretary
of Defense (DoD), the Administrator of General Services (GSA), and the
Administrator of the National Aeronautics and Space Administration
(NASA) that urgent and compelling reasons exist to promulgate this
interim rule without prior opportunity for public comment. This action
is necessary to limit the use of brand name specifications and provide
for maximum competition. However, pursuant to Public Law 98-577 and FAR
1.501, the Councils will consider public comments received in response
to this interim rule in the formation of the final rule.
List of Subjects in 48 CFR Parts 5, 6, 8, 11, and 13.
Government procurement.
Dated: September 19, 2006.
Ralph De Stefano,
Director, Contract Policy Division.
0
Therefore, DoD, GSA, and NASA amend 48 CFR parts 5, 6, 8, 11, and 13 as
set forth below:
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1. The authority citation for 48 CFR parts 5, 6, 8, 11, and 13
continues to read as follows:
Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42
U.S.C. 2473(c).
PART 5--PUBLICIZING CONTRACT ACTIONS
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2. Amend section 5.102 by adding paragraph (a)(6) to read as follows:
5.102 Availability of solicitations.
(a)(1) * * *
* * * * *
(6) When an acquisition contains brand name specifications, the
contracting officer shall include with the solicitation the
justification or documentation required by 6.302-1(c), 13.106-1(b), or
13.501, redacted as necessary (see 6.305).
* * * * *
PART 6--COMPETITION REQUIREMENTS
0
3. Amend section 6.302-1 in paragraph (c) by adding a new sentence
before the last sentence to read as follows:
6.302-1 Only one responsible source and no other supplies or services
will satisfy agency requirements.
* * * * *
(c) * * * See 5.102(a)(6) for the requirement to post the brand
name justification. * * *
* * * * *
PART 8--REQUIRED SOURCES OF SUPPLIES AND SERVICES
0
4. Amend section 8.402 by--
0
a. Adding to paragraph (c)(2) ``(except see 8.405-6)'' after
``contractors''; and
0
b. Adding to paragraph (d) a new sentence after the second sentence to
read as follows:
8.402 General.
* * * * *
(d)* * * Ordering activities shall post an RFQ to e-Buy when an
order contains brand name specifications (see 8.405-6). * * *
* * * * *
0
5. Amend section 8.405-1 by revising paragraphs (c) and (d)(1) to read
as follows:
8.405-1 Ordering procedures for supplies, and services not requiring
a statement of work.
* * * * *
(c) Orders exceeding the micro-purchase threshold but not exceeding
the maximum order threshold. (1) Ordering activities shall place orders
with the schedule contractor that can provide the supply or service
that represents the best value. Before placing an order, an ordering
activity shall consider reasonably available information about the
supply or service offered under MAS contracts by surveying at least
three schedule contractors through the GSA Advantage! on-line shopping
service, or by reviewing the catalogs or pricelists of at least three
schedule contractors (see 8.405-5).
(2) When an order contains brand name specifications, the
contracting officer shall post the Request for Quote (RFQ) along with
the justification or documentation as required by 8.405-6.
(3) In addition to price, when determining best value, the ordering
activity may consider, among other factors, the following:
(i) Past performance.
(ii) Special features of the supply or service required for
effective program performance.
(iii) Trade-in considerations.
(iv) Probable life of the item selected as compared with that of a
comparable item.
(v) Warranty considerations.
(vi) Maintenance availability.
(vii) Environmental and energy efficiency considerations.
(viii) Delivery terms.
(d)* * *;
(1) Review (except see (c)(2) of this subsection) the pricelists of
additional schedule contractors (the GSA Advantage! on-line shopping
service can be used to facilitate this review);
* * * * *
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6. Amend section 8.405-6 by--
0
a. Revising paragraph (a) and the introductory text of paragraph (b);
0
b. Removing paragraph (b)(3);
0
c. Redesignating paragraph (b)(4) as (b)(3);
0
d. Revising paragraph (c);
0
e. Redesignating paragraphs (d), (e), and (f) as (f), (g) and (h)
respectively;
0
f. Adding new paragraphs (d) and (e);
0
g. Removing from the newly designated paragraph (f) ``of schedule
contractors to fewer than required in 8.405-1 or 8.405-2'';
0
h. Removing from newly designated paragraph (g)(2)(iv) ``8.405-6(b)''
and adding ``8.405-6(a) and (b)'' in its place;
0
i. Revising newly designated paragraph (g)(2)(viii);
0
j. Removing from newly designated paragraph (h)(2) ``(f)(3) or (f)(4)''
and adding ``(h)(3) or (h)(4)'' in its place; and
0
k. Removing from newly designated paragraph (h)(3)(iii) ``(f)(4)'' and
adding ``(h)(4)'' in its place.
The revised and added text reads as follows:
8.405-6 Limited sources justification and approval.
(a) Orders placed under Federal Supply Schedules are exempt from
the requirements in Part 6. However, an ordering activity must justify
its action when restricting consideration--
(1) Of schedule contractors to fewer than required in 8.405-1 or
8.405-2; or
(2) To an item peculiar to one manufacturer (e.g., a particular
brand name, product, or a feature of a product, peculiar to one
manufacturer). A brand name item, whether available on one or more
schedule contracts, is an item peculiar to one manufacturer. Brand name
specifications shall not be used unless the particular brand name,
product, or feature is essential to the Government's requirements, and
market research indicates other companies' similar products, or
products lacking the particular feature, do not meet, or cannot be
modified to meet, the agency's needs.
(b) Circumstances that may justify restriction cited in paragraph
(a)(1) of this subsection include--
* * * * *
(c) Ordering activities shall procure such requirements only if the
need to do so is justified in writing and approved at the levels
specified in paragraphs (f) and (h) of this subsection.
[[Page 57360]]
(d) Except as provided in paragraph (e) of this subsection, when an
order contains brand name specifications, the ordering activity shall
post the following information along with the Request for Quotation
(RFQ) to e-Buy (http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.ebuy.gsa.gov):
(1) For proposed orders exceeding $25,000, but not exceeding the
simplified acquisition threshold, the documentation required by
paragraph (f) of this subsection.
(2) For proposed orders exceeding the simplified acquisition
threshold, the justification required by paragraph (g) of this
subsection.
(e) The posting requirement of paragraph (d) of this subsection
does not apply when--
(1) Disclosure would compromise the national security (e.g., would
result in disclosure of classified information) or create other
security risks. The fact that access to classified matter may be
necessary to submit a proposal or perform the contract does not, in
itself, justify use of this exception;
(2) The nature of the file (e.g., size, format) does not make it
cost-effective or practicable for contracting officers to provide
access through e-Buy; or
(3) The agency's senior procurement executive makes a written
determination that access through e-Buy is not in the Government's
interest.
* * * * *
(g) * * *
(2) * * *
(viii) A statement of the actions, if any, the agency may take to
remove or overcome any barriers that led to the restricted
consideration before any subsequent acquisition for the supplies or
services is made.
* * * * *
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7. Amend section 8.406-1 by revising the first sentence of the
introductory text to read as follows:
8.406-1 Order placement.
Ordering activities may place orders orally (except for services
requiring a statement of work (SOW) or orders containing brand name
specifications that exceed $25,000) or use Optional Form 347, an
agency-prescribed form, or an established electronic communications
format to order supplies or services from schedule contracts. * * *
* * * * *
PART 11--DESCRIBING AGENCY NEEDS
0
8. Amend section 11.105 by--
0
a. Redesignating paragraphs (a), (b), and (c) as (a)(1), (a)(2)(i), and
(a)(2)(ii) respectively; and adding new paragraphs (a)(3) and (b);
0
b. Amending newly redesignated paragraph (a)(2)(i) by removing ``and''
from the end of the paragraph and adding ``or'' in its place; and
0
c. Revising newly redesignated paragraph (a)(2)(ii).
The revised and added text reads as follows:
11.105 Items peculiar to one manufacturer.
* * * * *
(a)(1) * * *
(2)(i) * * *
(ii) The basis for not providing for maximum practicable
competition is documented in the file (see 13.106-1(b)) or justified
(see 13.501) when the acquisition is awarded using simplified
acquisition procedures.
(3) The documentation or justification is posted for acquisitions
over $25,000. (See 5.102(a)(6).)
(b) For multiple award schedule orders, see 8.405-6.
PART 13--SIMPLIFIED ACQUISITION PROCEDURES
0
9. Amend section 13.105 by adding paragraph (c) to read as follows:
13.105 Synopsis and posting requirements.
* * * * *
(c) See 5.102(a)(6) for the requirement to post a brand name
justification or documentation required by 13.106-1(b) or 13.501.
0
10. Amend section 13.106-1 by--
0
a. Amending paragraph (b)(1) by adding ``brand name'' after
``agreements,'';
0
b. Amending paragraph (b)(2) by adding ``(including brand name)'' after
``For sole source''; and
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c. Adding a new paragraph (b)(3) to read as follows--
13.106-1 Soliciting competition.
* * * * *
(b) * * *
(3) See 5.102(a)(6) for the requirement to post the brand name
justification or documentation.
* * * * *
13.106-3 [Amended]
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11. Amend section 13.106-3 in paragraph (b)(3)(i) by adding ``(see
13.106-1 for brand name purchases)'' after ``competition''.
13.501 [Amended]
0
12. Amend section 13.501 by--
0
a. Amending the paragraph heading in paragraph (a) by adding
``(including brand name)'' after ``Sole source'';
0
b. Amending paragraph (a)(1)(i) by adding ``(including brand name)''
after ``2.101,''; and
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c. Amending paragraphs (a)(1)(ii) and (a)(2) by adding ``(including
brand name)'' after ``sole source''.
[FR Doc. 06-8200 Filed 9-27-06; 8:45 am]
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