[Federal Register: November 2, 2011 (Volume 76, Number 212)]
[Rules and Regulations]               
[Page 68027-68028]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]





48 CFR Parts 4, 25, and 52

[FAC 2005-54; FAR Case 2010-012; Item IV; Docket 2010-0102, Sequence 1]
RIN 9000-AL71

Federal Acquisition Regulation; Certification Requirement and 
Procurement Prohibition Relating to Iran Sanctions

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

ACTION: Final rule.


SUMMARY: DoD, GSA, and NASA have adopted as final, with changes, an 
interim rule amending the Federal Acquisition Regulation (FAR) to 
implement sections 102 and 106 of the Comprehensive Iran Sanctions, 
Accountability, and Divestment Act of 2010. Section 102 requires 
certification that each offeror, and any person owned or controlled by 
the offeror, does not engage in any activity for which sanctions may be 
imposed under section 5 of the Iran Sanctions Act of 1996 (the Iran 
Sanctions Act). Section 106 imposes a procurement prohibition relating 
to contracts with persons that export certain sensitive technology to 
Iran. There will be further implementation of section 106 in FAR Case 
2010-018, Representation Regarding Export of Sensitive Technology to 

DATES: Effective Date: November 2, 2011.

FOR FURTHER INFORMATION CONTACT: Ms. Cecelia L. Davis, Procurement 
Analyst, at (202) 219-0202, for clarification of content. For 
information pertaining to status or publication schedules, contact the 
Regulatory Secretariat at (202) 501-4755. Please cite FAC 2005-54, FAR 
Case 2010-012.


I. Background

    DoD, GSA, and NASA published an interim rule in the Federal 
Register at 75 FR 60254 on September 29, 2010, to implement section 102 
and to partially implement section 106 of the Comprehensive Iran 
Sanctions, Accountability, and Divestment Act of 2010. FAR Case 2010-
018, Representation Regarding Export of Sensitive Technology to Iran, 
will provide further implementation of section 106 by adding a 
representation regarding export of sensitive technology to Iran and a 
waiver provision.
    Two respondents submitted comments on the interim rule.

II. Discussion and Analysis of the Public Comments

    The Civilian Agency Acquisition Council and the Defense Acquisition 
Regulations Council (the Councils) reviewed the public comments in the 
development of the final rule. A discussion of the comments and the 
changes made to the rule as a result of those comments are provided as 

A. Applicability to Construction

    Comment: One respondent was concerned that the prescription at FAR 
25.1103, which requires use of the FAR provision at 52.225-25, 
Prohibition on Engaging in Sanctioned Activities Relating to Iran--
Certification, in ``each solicitation for the acquisition of products 
or services'' could be interpreted to exclude construction. The 
respondent suggested changing the prescription to require use in ``all 
    Response: The phrase ``products or services'' was intended to 
include construction, as indicated in the FAR clause matrix. DoD, GSA, 
and NASA have agreed to change the final rule to require use of the 
provision in ``all solicitations.''

B. Commercial Database of Persons Doing Business With Iran

    Comment: One respondent provided information about the commercial 
Iran Economic Interest database of persons doing business with Iran, 
provided by World-Check, a provider of data services to organizations, 
including Government contractors. This respondent believed that this 
data set provided by his company is the only standard that would allow 
Government contractors the ability to comply with the provisions of the 
Comprehensive Iran Sanctions, Accountability, and Divestment Act of 
2010. He suggested that the Government should require or recommend that 
contractors should have this data available before they ``self-
    Response: The Government does not generally promote the use of 
particular commercial services. DoD, GSA, and NASA have not changed the 
final rule in response to this comment.

[[Page 68028]]

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 a significant regulatory action and, therefore, was 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

    The Department of Defense, the General Services Administration, and 
the National Aeronautics and Space Administration certify that this 
final rule will not 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 this rule will only 
have impact on an offeror that is engaging in an activity for which 
sanctions may be imposed under section 5 of the Iran Sanctions Act or 
that is exporting sensitive technology to Iran. This rule will have 
little effect on domestic small business concerns, because such 
dealings with Iran are already generally prohibited under U.S. law. Due 
to current restrictions on trade with Iran, domestic entities are 
generally prohibited from engaging in activity that would cause them to 
be subject to the procurement bans described in this rule (see e.g., 
Department of the Treasury Office of Foreign Assets Control regulations 
at 31 CFR part 560). Accordingly, it is expected that the number of 
domestic entities, both large and small, significantly impacted by this 
rule will be minimal, if any.
    Although this rule mainly affects foreign entities, the Regulatory 
Flexibility Act is for the protection of domestic small entities, not 
foreign entities. For the definition of ``small business'', the 
Regulatory Flexibility Act refers to the Small Business Act, which in 
turn allows the Small Business Administration (SBA) Administrator to 
specify detailed definitions or standards (5 U.S.C. 601(3) and 15 
U.S.C. 632(a)). The SBA regulations at 13 CFR 121.105 discuss who is a 
small business: ``(a)(1) Except for small agricultural cooperatives, a 
business concern eligible for assistance from SBA as a small business 
is a business entity organized for profit, with a place of business 
located in the United States, and which operates primarily within the 
United States or which makes a significant contribution to the U.S. 
economy through payment of taxes or use of American products, materials 
or labor.'' Therefore, the impact assessment does not include the 
impact on foreign entities.

V. Paperwork Reduction Act

    The final 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 Parts 4, 25, and 52

    Government procurement.

    Dated: October 21, 2011.
Laura Auletta,
Acting Director, Office of Governmentwide Acquisition Policy, Office of 
Acquisition Policy, Office of Governmentwide Policy.

Interim Rule Adopted as Final With Change

    Accordingly, the interim rule amending 48 CFR parts 4, 25, and 52 
which was published in the Federal Register at 75 FR 60254 on September 
29, 2010, is adopted as final with the following change:


1. The authority citation for 48 CFR part 25 continues to read as 

    Authority:  40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42 
U.S.C. 2473(c).

2. Amend section 25.1103 by revising paragraph (e) to read as follows:

25.1103   Other provisions and clauses.

* * * * *
    (e) The contracting officer shall include in all solicitations the 
provision at 52.225-25, Prohibition on Contracting with Entities 
Engaging in Sanctioned Activities Relating to Iran--Representation and 

[FR Doc. 2011-27783 Filed 11-1-11; 8:45 am]