[Federal Register: November 22, 2002 (Volume 67, Number 226)]
[Rules and Regulations]               
[Page 70515-70517]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]

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Part IV

Department of Defense

General Services Administration

National Aeronautics and Space Administration


48 CFR Ch. 1, Parts 4, 7, et al.

 Federal Acquisition Regulations; Final Rules

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48 CFR Chapter 1

Federal Acquisition Circular 2001-10; Introduction

AGENCIES: Department of Defense (DoD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Summary presentation of final rules and technical amendments 
and corrections.


SUMMARY: This document summarizes the Federal Acquisition Regulation 
(FAR) rules agreed to by the Civilian Agency Acquisition Council and 
the Defense Acquisition Regulations Council in this Federal Acquisition 
Circular (FAC) 2001-10. A companion document, the Small Entity 
Compliance Guide (SECG), follows this FAC. The FAC, including the SECG, 
is available via the Internet at http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.arnet.gov/far.

DATES: For effective dates and comment dates, see separate documents 
which follow.

Building, Washington, DC 20405, (202) 501-4755, for information 
pertaining to status or publication schedules. For clarification of 
content, contact the analyst whose name appears in the table below in 
relation to each FAR case or subject area. Please cite FAC 2001-10 and 
specific FAR case number(s). Interested parties may also visit our Web 
site at http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.arnet.gov/far.

    Item                      Subject                           FAR case              Analyst
I             General Records Schedule...............  2002-016.................         Nelson.
II            Executive Order 13202, Preservation of   2001-016.................         Nelson.
               Open, Competition and Government
               Neutrality Towards Government
               Contractors' Labor Relations On
               Federal and Federally Funded
               Construction projects.
III           Caribbean Basin Country End Products...  2000-306.................          Davis.
IV            Financing Policies.....................  2000-007.................          Olson.
V             Technical Amendments...................  .........................  ...............

SUPPLEMENTARY INFORMATION: Summaries for each FAR rule follow. For the 
actual revisions and/or amendments to these FAR cases, refer to the 
specific item number and subject set forth in the documents following 
these item summaries.
    FAC 2001-10 amends the FAR as specified below:

Item I--General Records Schedule (FAR Case 2002-016)

    This final rule amends the FAR to reflect the previous language of 
FAR 4.705-2 exactly as it was written prior to revision of this 
subsection by FAC 97-18, item IV, General Records Schedule (FAR case 
1999-615) published in the Federal Register on June 6, 2000 (65 FR 
36012). It was brought to the attention of the Councils that the prior 
change to FAR 4.705-2 made in FAC 97-18 inadvertently resulted in 
longer record retention periods for contractors and subcontractors. 
This final rule--
    [sbull] Revises the subsection title of FAR 4.705-2 to read ``Pay 
administration records'' instead of ``Construction contract pay 
administration records,'' thus, making all record retention 
requirements in the entire subsection applicable to all contracts 
rather than limiting it to construction contracts;
    [sbull] Revises FAR 4.705-2(a) to change from a record retention 
period of 3 years after completion of contract unless contract 
performance is the subject of enforcement action, to 4 years after 
generation of the records.
    For the period from June 6, 2000, through the effective date of 
this final rule, compliance with either the record retention 
requirements contained in this rule or the requirements published in 
FAC 97-18 is acceptable.

Item II--Executive Order 13202, Preservation of Open Competition and 
Government Neutrality Towards Government Contractors' Labor Relations 
on Federal and Federally Funded Construction Projects (FAR Case 2001-

    This final rule terminates the stay and adopts the May 16, 2001, 
interim rule as final without change. The rule amends FAR parts 17, 22, 
and 36 to implement Executive Order 13202, as amended by Executive 
Order 13208. Contracting officers, or any construction manager acting 
on behalf of the Government, may not require or prohibit offerors, 
contractors, or subcontractors from entering into or adhering to 
project labor agreements with one or more labor organizations. It also 
permits agency heads to exempt a project from the requirements of the 
Executive order under special circumstances, but the exemption may not 
be related to the possibility of, or an actual, labor dispute.

Item III--Caribbean Basin Country End Products (FAR Case 2000-306)

    The interim rule published in the Federal Register as item V of FAC 
2001-04 (67 FR 6116, February 8, 2002), is converted to a final rule 
with changes. The interim rule implemented the determination of the 
United States Trade Representative (USTR) to extend the treatment of 
certain end products, from countries designated by the President as 
beneficiaries under the Caribbean Basin Economic Recovery Act, as 
eligible products under the Trade Agreements Act, with the exception of 
end products from the Dominican Republic, Honduras, and Panama. It also 
implemented section 211 of the United States-Caribbean Basin Trade 
Partnership Act and the determination of the USTR as to which countries 
qualify for the enhanced trade benefits under that Act. However, on 
July 12, 2002, the USTR published a notice in the Federal Register to 
reinstate the treatment on Government procurement of products from 
Honduras. The notice stated that products of Honduras shall be treated 
as eligible products for purposes of section 1-101 of Executive Order 
12260. Such treatment shall not apply to products

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originating in Honduras that are excluded from duty-free treatment 
under 19 U.S.C. 2703(b). The determination to reinstate Honduras as 
published by the USTR has been incorporated in this final rule.

Item IV--Financing Policies (FAR Case 2000-007)

    This final rule revises certain financing policies at FAR part 32, 
Contract Financing, and related contract provisions at FAR part 52. The 
    [sbull] Removes the restriction on use of performance-based 
payments on fixed-price contracts prior to definitization; and
    [sbull] Permits large businesses, in their billings to the 
Government, to include certain vendor and subcontractor costs that have 
been incurred, but not actually paid, provided that, ordinarily, they 
pay the subcontractor within 30 days.

Item V--Technical Amendments

    These amendments update references and make editorial changes at 
FAR 7.105(b)(4)(i) and 19.502-2(a).

    Dated: November 12, 2002.
Al Matera,
Director, Acquisition Policy Division.

Federal Acquisition Circular

    Federal Acquisition Circular (FAC) 2001-10 is issued under the 
authority of the Secretary of Defense, the Administrator of General 
Services, and the Administrator for the National Aeronautics and Space 
    Unless otherwise specified, all Federal Acquisition Regulation 
(FAR) and other directive material contained in FAC 2001-10 are 
effective December 23, 2002, except for items II, III, and V, which are 
effective November 22, 2002.

    Dated: November 1, 2002.
Deidre A. Lee,
Director, Defense Procurement and Acquisition Policy.
    Dated: October 28, 2002.
David A. Drabkin,
Deputy Associate Administrator, Office of Acquisition Policy, General 
Services Administration.
    Dated: October 28, 2002.
Tom Luedtke,
Assistant Administrator for Procurement, National Aeronautics and Space 
[FR Doc. 02-29088 Filed 11-21-02; 8:45 am]