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Junius

When "all solicitations and contracts" does not mean all solicitations and contracts.

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On Netflix I’ve been watching a show related to people allegedly providing false confessions.  Sometimes the false confessions are elicited because the subject has been so psychologically broken down that they begin to believe they actually committed the crime.  I think I’m having one of these moments as it relates to Government contracting.

It’s about provisions and clauses.  My (admittedly journeyman) understanding of the FAR is that apparently unambiguous prescriptions that a provision or clause applies to “all solicitations and contracts” is frustrated by FAR 12.301(d) when acquiring commercial items.  For instance, I do not include FAR 52.243-1 (Alt III) in my solicitation for a fixed-price requirement for professional services because the service is commercial and “Changes” are already described in FAR 52.212-4(c), which is actually required in all commercial solicitations and contracts.  When the GS-14 Procurement Analyst returns my solicitation with a recommendation that I include FAR 52.243-1 (Alt III) in my solicitation, it’s a relatively simple task for me to explain my position once I have finished lamenting the fact that I am not a GS-14 Procurement Analyst.  I no longer think your average Frog (as Pepe would say) completely understands the meaning of the word “Notwithstanding.”

Where it becomes trickier is with a provision or clause that does not necessarily have an “equivalent” commercial provision or clause.  Now, I understand this is a DFARS clause, but take 252.225-7048, Export-Controlled Items, for example.  My understanding of DFARS Case 2011-D056 is that DFARS 212.301(f) was implemented in its current form to represent a complete list of the DFARS provisions and clauses that are applicable to the acquisition of commercial items.  In other words, if a DFARS provision or clause is not listed in DFARS 212.301(f), it is not applicable to the acquisition of commercial items.

Where I begin to question my sanity is whenever I go to award my commercial, firm-fixed-price services contract.  I send my contract award to be validated against the Procurement Data Standard (PDS) and, unfortunately, I receive an error that I have failed to include DFARS 252.225-7048 in my contract award.  According to its prescription, 252.225-7048 is required in “all solicitations and contracts” which the PDS error message also helpfully reminds me.  However, it’s not listed as applicable to the acquisition of commercial items in DFARS 212.301(f), nor does it include handy-dandy language in the prescription specifically referencing applicability to FAR part 12 as do most DFARS provisions and clauses listed in DFARS 212.301(f).  Therefore, I interpret that this clause does not, in fact, apply to my contract.  If I fail to include it, however, I will inevitably end up on a naughty list with a command from above to modify my contract to include the clause, and shame on me for willfully ignoring the PDS.

As I understand it, PDS is implemented by DPAP.  Clearly, I think DPAP has it wrong on this one as well as with DFARS 252.203-7002, where I received the same error.  However, I’m so broken down by the unending tsunami of data calls, reports, reviews, requests, templates, instructions, validations, and audits that I’m not sure I can think anymore.  But maybe that’s the goal.

Have I lost it? Is my approach to provisions and clauses relating to the acquisition of commercial items sound? J

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No, you're correct. However, you're incorrect in thinking that DPAP is responsible for you getting an error message.

For some reason, some people just can't accept that if a DFARS provision or clause is not listed in DFARS 212.301(f), then it's not required in a solicitation for the acquisition of commercial items. They seize on prescribing language that says "Insert this clause in all solicitations and contracts..." and become stuck. They don't get the concept that regulations must be read as a whole. I recently had a former student e-mail me with the same dilemma--her legal counsel sent back her solicitation because it didn't contain some DFARS clauses, including DFARS 252.225-7048. This is what her legal counsel wrote:

Quote

 

With regards to the clauses previously recommended for consideration, while we understand that these clauses are not specified in Part 212 or the DoN CI Matrix provided by I&L, the prescribing language and the statutory requirements take precedence (not all portions of the DFARS are updated concurrently and sometimes it leaves contradictions; also, DFARS Part 212 does not have language similar to FAR Part 12 that specifically states that any clauses not included are excluded unless the KO elects to include).  Additionally, while there may be a concern regarding imposition of requirements on contractors such that commerciality of the procurement is threatened, when we make recommendations for clause inclusions we consider whether the clause prescribes some kind of process requirement for the contractor (such that additional costs may be intrinsically levied) or whether the clause is merely information to the contractor to ensure they are protecting themselves and comply with all applicable laws. 

For example, with respect to FAR 252.203-7002, Requirement to Inform Employees of Whistleblower Rights, the prescribing language is "Use the clause at 252.203-7002, Requirement to Inform Employees of Whistleblower Rights, in all solicitations and contracts."  The clause requires the Contractor to inform its employees in writing, in the language of the predominant workforce, of their contractor employee whistleblower rights and protections under 10 U.S.C. 2409.  203.900 applies to DoD instead of FAR subpart 3.9.  It is intended to protect employees of contractors from reprisal from reporting items such gross mismanagement of a DoD contract or waste etc.  It is intended to encourage contractor employees to report fraud, waste, and abuse without fear of reprisal.  It applies to all contracts and grants awarded by DoD.  The only exception is I see in 10 U.S.C. 2409 is for contracts involving work in the intelligence community.  Even though this may not be in your commercial solicitation preparation guide, I see nothing under the statute that exempts DoD from putting this provision in commercial solicitations.  I recommend that you include.

With respect to DFARS 252.209-7004, Subcontracting with Firms that are Owned or Controlled by the Government of a Country that is a State Sponsor of Terrorism, the prescribing language is "use the clause...in solicitations and contracts with a value of $150,000 or more."  The clause is intended to cover those entities listed as ineligible in the "exclusion" section of SAM and the contractor's responsibility to comply is independent of this clause.  I don't see any exclusions applicable to DoD and recommend you include.

With respect to DFARS 252.225-7048, Export Controlled Items:  The prescribing language is " Use the clause at 252.225-7048, Export-Controlled Items, in all solicitations and contracts."  In DFARS 225.7901-3, DoD policy recognizes it is the interest of both the Government and the contractor to be aware of export controls as they apply to DoD Contracts and that it is the contractor's responsibility to comply with all applicable laws and regulations.  The clause informs the contractor that they must comply with all applicable laws and regulations regarding export-controlled items.  The contractor's obligation to comply with these export control laws is independent of this clause.  This clause (1) puts the contractor on notice of their responsibility and (2) requires them to pass along this notice to any subcontractors.  I do not know if any of the supplies involved in ballistic vests are subject to export controls.  Even though this may not be in your commercial solicitation preparation guide, I see nothing under the statute that exempts DoD from putting this provision in commercial solicitations.  Moreover, as the potential for export controlled items exist under this contract, I recommend that you include.  

With regards to DFARS 252.204-7003, this clause is really intended to protect the Government and place the contractor on notice that control of Government information is not relinquished to the contractor.  Per the describing language, recommend this be included.

 

This is what I wrote back to her:

Quote

 

Your legal counsel is misunderstanding. The attached Federal Register notice explains that, by law, the DFARS must contain a list of contract clauses that are authorized for use in contracts for the acquisition of commercial items (see the first page of the attachment and the responses to the questions starting on the second page). If a clause is not on the list, it is not authorized for use in contracts for commercial items. That list is now contained at DFARS 212.301. Each time a clause is added to the DFARS, the DAR Council makes a determination of whether the clause should apply to the acquisition of commercial items. If the determination is to apply the law to the acquisition of commercial items, then the determination will appear in the Federal Register notice of the final rule.

Your legal counsel errs in believing that a statute must contain an exception for commercial items for a law to be inapplicable to contracts for commercial items. That's not how it works. Pursuant to the Federal Acquisition Streamlining Act of 1994, no acquisition law enacted after October 13, 1994, applies to the acquisition of commercial items unless the FAR Council (for laws implemented in FAR) or DAR Council (for laws implemented in the DFARS) makes a written determination that it would not be in the best interest of the Government to exempt acquisitions of commercial items from the law's coverage (41 U.S.C. 1906).

The final rules incorporating DFARS 252.203-7002, 252.209-7004, and 252.225-7048, into the DFARS did not contain such a determination, so these clause weren't added to the list at DFARS 212.301. In fact, the final rule incorporating DFARS 252.209-7004 (79 FR 45666-01) stated:

"The clause at 252.209-7004 is not prescribed for use in the acquisitions of commercial items. This clause implements paragraphs (d) and (e) of 10 U.S.C. 2327, which were enacted in 1997 (Pub. L. 105-85) (subsequent to the Federal Acquisition Streamlining Act of 1994), and therefore were inapplicable to the acquisitions of commercial items and COTS items, unless a determination was made that it would not be in the best interest of the Government to exempt these acquisitions from applicability of the statute."

I'd be happy to explain this to your legal counsel. This has been the law for almost 23 years.

 

So, when her legal counsel saw the FR notice and read 41 USC 1906, they realized their mistake...is not what happened. They responded by saying the statutes that the DFARS clauses in question implement take precedence over the DAR Council determination. This person has a law degree and is the member of a bar in some state. Sad.

fr_2011-D056 (1).pdf

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Which is why coverage of commercial items contracting should be removed from the FAR, Chapter 1 of Title 48 of the CFR, and placed in a separate chapter of Title 48, which should expressly state that it is the exclusive coverage for commercial items. Hear that, Section 809 Panel? While you're at it, take simplified acquisition out of the FAR, as well.

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Thanks for your responses.  I'm glad that, at least with respect to this subject, I'm not going crazy.  If the interplay between FAR 12 and FAR 13 with other parts of the FAR were better understood or expressed more clearly, it would save me a lot of time and frustration.

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