Posted 26 January 2012 - 09:01 AM
Question 1 - In the negotiation of this UCA is the CO correct (what is their justification) in citing 31.205-26(e) as a basis for arbitrarily reducing the affiliates proposed by price by 10% for disallowance of profit?
Further background for Question 2 - There is an established practice recognized by the CO, of the affiliate to price their commercial efforts at other than cost, thus meeting the first test under 31.205-26(e), however under this circumstance the UCA did not warrant competition and thus the CO asserts that "adequate price competition" did not occur in accordance with FAR 15.403-1. Because the second test under 31.205-26(e) was not met, the affiliates proposed efforts must be at the affiliates cost so goes the logic.
Question 2 - If we are stuck with having to comply with 31.205-26, could we not look to FAR 15.403-1©(1)(iii) to demonstrate "adequate price competition?"
Thanks in advance for your views here
Posted 26 January 2012 - 09:22 AM
When costs are a factor in any price adjustment under this contract, the contract cost principles and procedures in FAR Part 31 and DFARS Part 231, in effect on the date of this contract, apply.
FAR 15.403-1 has nothing to do with this.
I had to edit this a couple of times to correct stupid mistakes. Sorry if that caused any confusion.
Posted 26 January 2012 - 09:35 AM
Posted 26 January 2012 - 10:39 AM
Posted 26 January 2012 - 10:50 AM
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