-CITE- 10 USC CHAPTER 137 - PROCUREMENT GENERALLY 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- CHAPTER 137 - PROCUREMENT GENERALLY -MISC1- Sec. [2301. Repealed.] 2302. Definitions. 2302a. Simplified acquisition threshold. 2302b. Implementation of simplified acquisition procedures. 2302c. Implementation of electronic commerce capability. 2302d. Major system: definitional threshold amounts. 2303. Applicability of chapter. [2303a. Repealed.] 2304. Contracts: competition requirements. 2304a. Task and delivery order contracts: general authority. 2304b. Task order contracts: advisory and assistance services. 2304c. Task and delivery order contracts: orders. 2304d. Task and delivery order contracts: definitions. 2304e. Contracts: prohibition on competition between Department of Defense and small businesses and certain other entities. 2305. Contracts: planning, solicitation, evaluation, and award procedures. 2305a. Design-build selection procedures. 2306. Kinds of contracts. 2306a. Cost or pricing data: truth in negotiations. 2306b. Multiyear contracts: acquisition of property. 2306c. Multiyear contracts: acquisition of services. 2307. Contract financing. 2308. Buy-to-budget acquisition: end items. 2309. Allocation of appropriations. 2310. Determinations and decisions. 2311. Assignment and delegation of procurement functions and responsibilities. 2312. Remission of liquidated damages. 2313. Examination of records of contractor. 2313a. Defense Contract Audit Agency: annual report. 2314. Laws inapplicable to agencies named in section 2303 of this title. 2315. Law inapplicable to the procurement of automatic data processing equipment and services for certain defense purposes. 2316. Disclosure of identity of contractor. [2317. Repealed.] 2318. Advocates for competition. 2319. Encouragement of new competitors. 2320. Rights in technical data. 2321. Validation of proprietary data restrictions. [2322. Repealed.] 2323. Contract goal for small disadvantaged businesses and certain institutions of higher education. 2323a. Credit for Indian contracting in meeting certain subcontracting goals for small disadvantaged businesses and certain institutions of higher education. 2324. Allowable costs under defense contracts. 2325. Restructuring costs. 2326. Undefinitized contractual actions: restrictions. 2327. Contracts: consideration of national security objectives. 2328. Release of technical data under Freedom of Information Act: recovery of costs. [2329. Repealed.] 2330. Procurement of contract services: management structure. 2330a. Procurement of services: tracking of purchases. 2331. Procurement of services: contracts for professional and technical services. 2332. Share-in-savings contracts. 2333. Joint policies on requirements definition, contingency program management, and contingency contracting. 2334. Independent cost estimation and cost analysis. 2335. Prohibition on collection of political information. AMENDMENTS 2011 - Pub. L. 112-81, div. A, title VIII, Sec. 805(b), 823(b), Dec. 31, 2011, 125 Stat. 1486, 1503, added items 2313a and 2335. 2009 - Pub. L. 111-23, title I, Sec. 101(b)(2), May 22, 2009, 123 Stat. 1709, added item 2334. 2008 - Pub. L. 110-181, div. A, title X, Sec. 1063(a)(10), Jan. 28, 2008, 122 Stat. 322, added item 2333 and struck out former item 2333 "Joint policies on requirements definition, contingency contracting, and program management". 2006 - Pub. L. 109-364, div. A, title VIII, Sec. 854(a)(2), Oct. 17, 2006, 120 Stat. 2346, added item 2333. Pub. L. 109-163, div. A, title VIII, Sec. 812(a)(2), Jan. 6, 2006, 119 Stat. 3378, substituted "Procurement of contract services: management structure" for "Procurement of services: management structure" in item 2330. 2002 - Pub. L. 107-347, title II, Sec. 210(a)(2), Dec. 17, 2002, 116 Stat. 2934, added item 2332. Pub. L. 107-314, div. A, title VIII, Sec. 801(a)(2), Dec. 2, 2002, 116 Stat. 2602, added item 2308. 2001 - Pub. L. 107-107, div. A, title VIII, Sec. 801(g)(2), Dec. 28, 2001, 115 Stat. 1178, added items 2330, 2330a, and 2331 and struck out former item 2331 "Contracts for professional and technical services". 2000 - Pub. L. 106-398, Sec. 1 [[div. A], title VIII, Sec. 802(a)(2)], Oct. 30, 2000, 114 Stat. 1654, 1654A-205, added item 2306c. 1998 - Pub. L. 105-261, div. A, title X, Sec. 1069(a)(3), Oct. 17, 1998, 112 Stat. 2135, substituted "electronic commerce capability" for "FACNET capability" in item 2302c. 1997 - Pub. L. 105-85, div. A, title VIII, Sec. 804(a)(2), title X, Sec. 1073(a)(48)(B), Nov. 18, 1997, 111 Stat. 1833, 1903, substituted "contracts: acquisition of property" for "contracts" in item 2306b and added item 2325. 1996 - Pub. L. 104-201, div. A, title VIII, Sec. 805(b), Sept. 23, 1996, 110 Stat. 2606, added item 2302d. Pub. L. 104-106, div. D, title XLI, Sec. 4105(a)(2), title XLIII, Sec. 4321(b)(6)(B), Feb. 10, 1996, 110 Stat. 647, 672, redesignated item 2304a, relating to contracts: prohibition on competition between Department of Defense and small businesses and certain other entities, as 2304e and added item 2305a. 1994 - Pub. L. 103-355, title I, Secs. 1004(a)(2), 1022(a)(2), 1501(b), 1503(a)(2), (b)(2), 1506(b), title II, Secs. 2001(i), 2201(a)(2), title IV, Secs. 4002(b), 4203(a)(2), title VIII, Sec. 8104(b)(2), title IX, Sec. 9002(b), Oct. 13, 1994, 108 Stat. 3253, 3260, 3296-3298, 3303, 3318, 3338, 3346, 3391, 3402, struck out items 2301 "Congressional defense procurement policy", 2308 "Assignment and delegation of procurement functions and responsibilities", 2325 "Preference for nondevelopmental items", and 2329 "Production special tooling and production special test equipment: contract terms and conditions", added items 2302a to 2302c, 2304a relating to task and delivery order contracts: general authority, 2304b to 2304d, and 2306b, and substituted "Contract financing" for "Advance payments" in item 2307, "Assignment and delegation of procurement functions and responsibilities" for "Delegation" in item 2311, and "Examination of records of contractor" for "Examination of books and records of contractor" in item 2313. 1993 - Pub. L. 103-160, div. A, title VIII, Secs. 828(a)(1), 848(a)(2), Nov. 30, 1993, 107 Stat. 1713, 1725, added item 2304a and struck out item 2317 "Encouragement of competition and cost savings". 1992 - Pub. L. 102-484, div. A, title VIII, Sec. 801(a)(2), (g)(2), title X, Sec. 1052(25)(B), div. D, title XLII, Sec. 4271(b)(2), Oct. 23, 1992, 106 Stat. 2442, 2445, 2500, 2695, struck out items 2322 "Limitation on small business set-asides" and 2330 "Integrated financing policy" and added items 2323 and 2323a. 1990 - Pub. L. 101-510, div. A, title VIII, Secs. 804(b), 834(a)(2), Nov. 5, 1990, 104 Stat. 1591, 1614, struck out item 2323 "Commercial pricing for spare or repair parts" and added item 2331. 1988 - Pub. L. 100-456, div. A, title VIII, Sec. 801(a)(2), Sept. 29, 1988, 102 Stat. 2007, added item 2330. 1987 - Pub. L. 100-180, div. A, title VIII, Sec. 810(a)(2), Dec. 4, 1987, 101 Stat. 1132, added item 2329. Pub. L. 100-26, Sec. 7(a)(7)(B)(ii), (b)(9)(B), Apr. 21, 1987, 101 Stat. 278, 280, transferred item 2305a "Major programs: competitive alternative sources", to chapter 144 as item 2438 and substituted "Release of technical data under Freedom of Information Act: recovery of costs" for "Release of technical data" in item 2328. Pub. L. 100-26, Sec. 5(4), (6), made technical amendments to directory language of sections 926(a)(2) and 954(a)(2), respectively, of Pub. L. 99-500, Pub. L. 99-591, and Pub. L. 99- 661. See 1986 Amendment note below. 1986 - Pub. L. 99-661, div. A, title XIII, Sec. 1343(a)(12), Nov. 14, 1986, 100 Stat. 3993, substituted "competitors" for "competition" in item 2319. Pub. L. 99-500, Sec. 101(c) [title X, Secs. 907(a)(2), 908(d)(1)(B), 926(a)(2), 951(a)(2), 952(c)(2), 954(a)(2)], Oct. 18, 1986, 100 Stat. 1783-82, 1783-138, 1783-141, 1783-155, 1783-165, 1783-169, 1783-173, and Pub. L. 99-591, Sec. 101(c) [title X, Secs. 907(a)(2), 908(d)(1)(B), 926(a)(2), 951(a)(2), 952(c)(2), 954(a)(2)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-138, 3341-141, 3341-155, 3341-165, 3341-169, 3341-173; Pub. L. 99-661, div. A, title IX, formerly title IV, Secs. 907(a)(2), 908(d)(1)(B), 926(a)(2), 951(a)(2), 952(c)(2), 954(a)(2), Nov. 14, 1986, 100 Stat. 3917, 3921, 3935, 3945, 3949, 3953, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; as amended by Pub. L. 100-26, Sec. 5(4), (6), Apr. 21, 1987, 101 Stat. 274, amended chapter analysis identically striking out ": cost or pricing data: truth in negotiations" after "contracts" in item 2306, substituting "spare or repair parts" for "supplies" in item 2323, and adding items 2306a and 2325 to 2328. 1985 - Pub. L. 99-145, title IX, Secs. 911(a)(2), 912(a)(2), Nov. 8, 1985, 99 Stat. 685, 686, added items 2305a and 2324. 1984 - Pub. L. 98-577, title III, Sec. 302(c)(2), Oct. 30, 1984, 98 Stat. 3077, struck out item 2303a "Publication of proposed regulations". Pub. L. 98-525, title XII, Sec. 1217, Oct. 19, 1984, 98 Stat. 2599, added items 2303a and 2317 to 2323. Pub. L. 98-369, div. B, title VII, Sec. 2727(a), July 18, 1984, 98 Stat. 1194, substituted "Congressional defense procurement policy" for "Declaration of policy" in item 2301, "Contracts: competition requirements" for "Purchases and contracts: formal advertising; exceptions" in item 2304, "Contracts: planning, solicitation, evaluation, and award procedures" for "Formal advertisements for bids; time; opening; award; rejection" in item 2305, and "Kinds of contracts; cost or pricing data: truth in negotiation" for "Kinds of contracts" in item 2306. 1982 - Pub. L. 97-295, Sec. 1(26)(B), Oct. 12, 1982, 96 Stat. 1291, added item 2316. 1981 - Pub. L. 97-86, title IX, Sec. 908(a)(2), Dec. 1, 1981, 95 Stat. 1118, added item 2315. 1980 - Pub. L. 96-513, title V, Sec. 511(75), Dec. 12, 1980, 94 Stat. 2926, inserted "formal" before "advertising" in item 2304. -End- -CITE- 10 USC Sec. 2301 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2301. Repealed. -MISC1- [Sec. 2301. Repealed. Pub. L. 103-355, title I, Sec. 1501(a), Oct. 13, 1994, 108 Stat. 3296]. Section, acts Aug. 10, 1956, ch. 1041, 70A Stat. 127; Dec. 1, 1981, Pub. L. 97-86, title IX, Sec. 909(a), 95 Stat. 1118; July 18, 1984, Pub. L. 98-369, div. B, title VII, Sec. 2721, 98 Stat. 1185; Oct. 18, 1986, Pub. L. 99-500, Sec. 101(c) [title X, Sec. 925(a)], 100 Stat. 1783-82, 1783-153, and Oct. 30, 1986, Pub. L. 99-591, Sec. 101(c) [title X, Sec. 925(a)], 100 Stat. 3341-82, 3341-153; Nov. 14, 1986, Pub. L. 99-661, div. A, title IX, formerly title IV, Sec. 925(a), 100 Stat. 3933, renumbered title IX, Apr. 21, 1987, Pub. L. 100-26, Sec. 3(5), 101 Stat. 273; Oct. 23, 1992, Pub. L. 102-484, div. A, title VIII, Sec. 808(a), 106 Stat. 2449, related to Congressional defense procurement policy. EFFECTIVE DATE OF REPEAL For effective date and applicability of repeal, see section 10001 of Pub. L. 103-355, set out as an Effective Date of 1994 Amendment note under section 2302 of this title. -End- -CITE- 10 USC Sec. 2302 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2302. Definitions -STATUTE- In this chapter: (1) The term "head of an agency" means the Secretary of Defense, the Secretary of the Army, the Secretary of the Navy, the Secretary of the Air Force, the Secretary of Homeland Security, and the Administrator of the National Aeronautics and Space Administration. (2) The term "competitive procedures" means procedures under which the head of an agency enters into a contract pursuant to full and open competition. Such term also includes - (A) procurement of architectural or engineering services conducted in accordance with chapter 11 of title 40; (B) the competitive selection for award of basic research proposals resulting from a general solicitation and the peer review or scientific review (as appropriate) of such proposals; (C) the procedures established by the Administrator of General Services for the multiple award schedule program of the General Services Administration if - (i) participation in the program has been open to all responsible sources; and (ii) orders and contracts under such program result in the lowest overall cost alternative to meet the needs of the United States; (D) procurements conducted in furtherance of section 15 of the Small Business Act (15 U.S.C. 644) as long as all responsible business concerns that are entitled to submit offers for such procurements are permitted to compete; and (E) a competitive selection of research proposals resulting from a general solicitation and peer review or scientific review (as appropriate) solicited pursuant to section 9 of the Small Business Act (15 U.S.C. 638). (3) The following terms have the meanings provided such terms in chapter 1 of title 41: (A) The term "procurement". (B) The term "procurement system". (C) The term "standards". (D) The term "full and open competition". (E) The term "responsible source". (F) The term "item". (G) The term "item of supply". (H) The term "supplies". (I) The term "commercial item". (J) The term "nondevelopmental item". (K) The term "commercial component". (L) The term "component". (4) The term "technical data" means recorded information (regardless of the form or method of the recording) of a scientific or technical nature (including computer software documentation) relating to supplies procured by an agency. Such term does not include computer software or financial, administrative, cost or pricing, or management data or other information incidental to contract administration. (5) The term "major system" means a combination of elements that will function together to produce the capabilities required to fulfill a mission need. The elements may include hardware, equipment, software or any combination thereof, but excludes construction or other improvements to real property. A system shall be considered a major system if (A) the conditions of section 2302d of this title are satisfied, or (B) the system is designated a "major system" by the head of the agency responsible for the system. (6) The term "Federal Acquisition Regulation" means the Federal Acquisition Regulation issued pursuant to section 1303(a)(1) of title 41. (7) The term "simplified acquisition threshold" has the meaning provided that term in section 134 of title 41, except that, in the case of any contract to be awarded and performed, or purchase to be made, outside the United States in support of a contingency operation or a humanitarian or peacekeeping operation, the term means an amount equal to two times the amount specified for that term in section 4 (!1) of such Act. (8) The term "humanitarian or peacekeeping operation" means a military operation in support of the provision of humanitarian or foreign disaster assistance or in support of a peacekeeping operation under chapter VI or VII of the Charter of the United Nations. The term does not include routine training, force rotation, or stationing. (9) The term "nontraditional defense contractor", with respect to a procurement or with respect to a transaction authorized under section 2371(a) of this title, means an entity that is not currently performing and has not performed, for at least the one- year period preceding the solicitation of sources by the Department of Defense for the procurement or transaction, any of the following for the Department of Defense: (A) Any contract or subcontract that is subject to full coverage under the cost accounting standards prescribed pursuant to section 26 (!1) of the Office of Federal Procurement Policy Act (41 U.S.C. 422) and the regulations implementing such section.(!1) (B) Any other contract in excess of $500,000 under which the contractor is required to submit certified cost or pricing data under section 2306a of this title. -SOURCE- (Aug. 10, 1956, ch. 1041, 70A Stat. 127; Pub. L. 85-568, title III, Sec. 301(b), July 29, 1958, 72 Stat. 432; Pub. L. 85-861, Sec. 1(43A), Sept. 2, 1958, 72 Stat. 1457; Pub. L. 96-513, title V, Sec. 511(74), Dec. 12, 1980, 94 Stat. 2926; Pub. L. 98-369, div. B, title VII, Sec. 2722(a), July 18, 1984, 98 Stat. 1186; Pub. L. 98- 525, title XII, Sec. 1211, Oct. 19, 1984, 98 Stat. 2589; Pub. L. 98-577, title V, Sec. 504(b)(3), Oct. 30, 1984, 98 Stat. 3087; Pub. L. 99-661, div. A, title XIII, Sec. 1343(a)(13), Nov. 14, 1986, 100 Stat. 3993; Pub. L. 100-26, Sec. 7(k)(2), Apr. 21, 1987, 101 Stat. 284; Pub. L. 101-189, div. A, title VIII, Sec. 853(b)(1), Nov. 29, 1989, 103 Stat. 1518; Pub. L. 102-25, title VII, Sec. 701(d)(1), Apr. 6, 1991, 105 Stat. 113; Pub. L. 102-190, div. A, title VIII, Sec. 805, Dec. 5, 1991, 105 Stat. 1417; Pub. L. 103-355, title I, Sec. 1502, Oct. 13, 1994, 108 Stat. 3296; Pub. L. 104-106, div. D, title XLIII, Sec. 4321(b)(3), Feb. 10, 1996, 110 Stat. 672; Pub. L. 104-201, div. A, title VIII, Secs. 805(a)(1), 807(a), Sept. 23, 1996, 110 Stat. 2605, 2606; Pub. L. 105-85, div. A, title VIII, Sec. 803(b), Nov. 18, 1997, 111 Stat. 1832; Pub. L. 107-217, Sec. 3(b)(2), Aug. 21, 2002, 116 Stat. 1295; Pub. L. 107-296, title XVII, Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314; Pub. L. 111- 350, Sec. 5(b)(8), Jan. 4, 2011, 124 Stat. 3842; Pub. L. 111-383, div. A, title VIII, Sec. 866(g)(1), Jan. 7, 2011, 124 Stat. 4298.) -MISC1- HISTORICAL AND REVISION NOTES 1956 ACT -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2302 41:158 (less clause (b)). Feb. 19, 1948, ch. 65, Sec. 9 (less clause (b)), 62 Stat. 24. -------------------------------------------------------------------- In clause (1), the words "(if any)" are omitted as surplusage. The words "Secretary of the Treasury" are substituted for the words "Commandant, United States Coast Guard, Treasury Department", since the functions of the Coast Guard and its officers, while operating under the Department of the Treasury, were vested in the Secretary of the Treasury by 1950 Reorganization Plan No. 26, effective July 31, 1950, 64 Stat. 1280. Under that plan the Secretary of the Treasury was authorized to delegate any of those functions to the agencies and employees of the Department of the Treasury. Clauses (2) and (3) are inserted for clarity, and are based on the usage of those terms throughout the revised chapter. 1958 ACT -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2302(3) [No source]. [No source]. -------------------------------------------------------------------- The amendments reflect section 1(44) of the bill [amending section 2305 of Title 10]. -REFTEXT- REFERENCES IN TEXT Section 4 of such Act, referred to in par. (7), means section 4 of Pub. L. 93-400, which was classified to section 403 of former Title 41, Public Contracts, and was repealed and the provisions thereof restated in sections 102, 103, 105, 107 to 116, 131 to 134, and 1301 of Title 41, Public Contracts, by Pub. L. 111-350, Secs. 3, 7(b), Jan. 4, 2011, 124 Stat. 3677, 3855. For disposition of sections of former Title 41, see Disposition Table preceding section 101 of Title 41. Section 26 of the Office of Federal Procurement Policy Act and such section, referred to in par. (9)(A), means section 26 of Pub. L. 93-400, which was classified to section 422 of former Title 41, Public Contracts, and was repealed and restated as chapter 15 (Sec. 1501 et seq.) of Title 41, Public Contracts, by Pub. L. 111-350, Secs. 3, 7(b), Jan. 4, 2011, 124 Stat. 3677, 3855. For disposition of sections of former Title 41, see Disposition Table preceding section 101 of Title 41. -MISC2- AMENDMENTS 2011 - Par. (3). Pub. L. 111-350, Sec. 5(b)(8)(A), substituted "chapter 1 of title 41" for "section 4 of the Office of Federal Procurement Policy Act (41 U.S.C. 403)" in introductory provisions. Par. (6). Pub. L. 111-350, Sec. 5(b)(8)(B), substituted "section 1303(a)(1) of title 41" for "section 25(c)(1) of the Office of Federal Procurement Policy Act (41 U.S.C. 421(c)(1))". Par. (7). Pub. L. 111-350, Sec. 5(b)(8)(C), substituted "section 134 of title 41" for "section 4 of the Office of Federal Procurement Policy Act (41 U.S.C. 403)". Par. (9). Pub. L. 111-383 added par. (9). 2002 - Par. (1). Pub. L. 107-296 substituted "of Homeland Security" for "of Transportation". Par. (2)(A). Pub. L. 107-217 substituted "chapter 11 of title 40" for "title IX of the Federal Property and Administrative Services Act of 1949 (40 U.S.C. 541 et seq.)". 1997 - Pars. (7), (8). Pub. L. 105-85 struck out "(A)" before "The term 'simplified" in par. (7), redesignated par. (7)(B) as par. (8), and substituted "The" for "In subparagraph (A), the" in that par. 1996 - Par. (3)(K). Pub. L. 104-106 inserted period at end. Par. (5). Pub. L. 104-201, Sec. 805(a)(1), substituted "A system shall be considered a major system if (A) the conditions of section 2302d of this title are satisfied, or (B) the system is designated a 'major system' by the head of the agency responsible for the system." for "A system shall be considered a major system if (A) the Department of Defense is responsible for the system and the total expenditures for research, development, test, and evaluation for the system are estimated to be more than $75,000,000 (based on fiscal year 1980 constant dollars) or the eventual total expenditure for procurement of more than $300,000,000 (based on fiscal year 1980 constant dollars); (B) a civilian agency is responsible for the system and total expenditures for the system are estimated to exceed $750,000 (based on fiscal year 1980 constant dollars) or the dollar threshold for a 'major system' established by the agency pursuant to Office of Management and Budget (OMB) Circular A-109, entitled 'Major Systems Acquisitions', whichever is greater; or (C) the system is designated a 'major system' by the head of the agency responsible for the system." Par. (7). Pub. L. 104-201, Sec. 807(a), designated existing provisions as subpar. (A), inserted "or a humanitarian or peacekeeping operation" after "contingency operation", and added subpar. (B). 1994 - Par. (3). Pub. L. 103-355, Sec. 1502(1), added par. (3) and struck out former par. (3) which read as follows: "The terms 'full and open competition' and 'responsible source' have the same meanings provided such terms in section 4 of the Office of Federal Procurement Policy Act (41 U.S.C. 403)." Par. (7). Pub. L. 103-355, Sec. 1502(2), added par. (7) and struck out former par. (7) which read as follows: "The term 'small purchase threshold' has the meaning given that term in section 4(11) of the Office of Federal Procurement Policy Act (41 U.S.C. 403(11)), except that, in the case of any contract to be awarded and performed, or purchase to be made, outside the United States in support of a contingency operation, the term means $100,000." 1991 - Par. (7). Pub. L. 102-190 inserted before period ", except that, in the case of any contract to be awarded and performed, or purchase to be made, outside the United States in support of a contingency operation, the term means $100,000". Pub. L. 102-25 added par. (7). 1989 - Par. (6). Pub. L. 101-189 added par. (6). 1987 - Pub. L. 100-26, Sec. 7(k)(2)(A), inserted "The term" after each par. designation except par. (3) and struck out uppercase letter of first word after first quotation marks in each par. and substituted lowercase letter. 1986 - Par. (2)(A). Pub. L. 99-661 substituted "(40 U.S.C." for "(41 U.S.C.". 1984 - Pub. L. 98-369 amended section generally, substituting in cl. (1) "the Secretary of Defense, the Secretary of the Army, the Secretary of the Navy, the Secretary of the Air Force" for "the Secretary, the Under Secretary, or any Assistant Secretary, of the Army, Navy, or Air Force", in cl. (2) definition of "competitive procedures" for a definition of "negotiate", and in cl. (3) definition of the terms "full and open competition" and "responsible source" for a definition of "formal advertising". Cl. (2)(D), (E). Pub. L. 98-577 added subpars. (D) and (E). Cls. (4), (5). Pub. L. 98-525 added cls. (4) and (5). 1980 - Cl. (1). Pub. L. 96-513 substituted "Secretary of Transportation" for "Secretary of the Treasury". 1958 - Cl. (1). Pub. L. 85-568 substituted "Administrator of the National Aeronautics and Space Administration" for "Executive Secretary of the National Advisory Committee for Aeronautics", in cl. (1). Cl. (3). Pub. L. 85-861 substituted "section 2305 of this title" for "section 2305(a) and (b) of this title". EFFECTIVE DATE OF 2002 AMENDMENT Amendment by Pub. L. 107-296 effective on the date of transfer of the Coast Guard to the Department of Homeland Security, see section 1704(g) of Pub. L. 107-296, set out as a note under section 101 of this title. EFFECTIVE DATE OF 1996 AMENDMENT Pub. L. 104-106, div. D, title XLIV, Sec. 4401, Feb. 10, 1996, 110 Stat. 678, provided that: "(a) Effective Date. - Except as otherwise provided in this division [div. D (Secs. 4001-4402) of Pub. L. 104-106, see Tables for classification], this division and the amendments made by this division shall take effect on the date of the enactment of this Act [Feb. 10, 1996]. "(b) Applicability of Amendments. - "(1) Solicitations, unsolicited proposals, and related contracts. - An amendment made by this division shall apply, in the manner prescribed in the final regulations promulgated pursuant to section 4402 [110 Stat. 678] to implement such amendment, with respect to any solicitation that is issued, any unsolicited proposal that is received, and any contract entered into pursuant to such a solicitation or proposal, on or after the date described in paragraph (3). "(2) Other matters. - An amendment made by this division shall also apply, to the extent and in the manner prescribed in the final regulations promulgated pursuant to section 4402 to implement such amendment, with respect to any matter related to - "(A) a contract that is in effect on the date described in paragraph (3); "(B) an offer under consideration on the date described in paragraph (3); or "(C) any other proceeding or action that is ongoing on the date described in paragraph (3). "(3) Demarcation date. - The date referred to in paragraphs (1) and (2) is the date specified in such final regulations. The date so specified shall be January 1, 1997, or any earlier date that is not within 30 days after the date on which such final regulations are published." EFFECTIVE DATE OF 1994 AMENDMENT Pub. L. 103-355, title X, Sec. 10001, Oct. 13, 1994, 108 Stat. 3404, provided that: "(a) Effective Date. - Except as otherwise provided in this Act, this Act [see Tables for classification] and the amendments made by this Act shall take effect on the date of the enactment of this Act [Oct. 13, 1994]. "(b) Applicability of Amendments. - (1) An amendment made by this Act shall apply, in the manner prescribed in the final regulations promulgated pursuant to section 10002 [108 Stat. 3404, formerly set out as a Regulations note under section 251 of former Title 41, Public Contracts] to implement such amendment, with respect to any solicitation that is issued, any unsolicited proposal that is received, and any contract entered into pursuant to such a solicitation or proposal, on or after the date described in paragraph (3). "(2) An amendment made by this Act shall also apply, to the extent and in the manner prescribed in the final regulations promulgated pursuant to section 10002 to implement such amendment, with respect to any matter related to - "(A) a contract that is in effect on the date described in paragraph (3); "(B) an offer under consideration on the date described in paragraph (3); or "(C) any other proceeding or action that is ongoing on the date described in paragraph (3). "(3) The date referred to in paragraphs (1) and (2) is the date specified in such final regulations [Oct. 1, 1995, see 60 F.R. 48231, Sept. 18, 1995]. The date so specified shall be October 1, 1995, or any earlier date that is not within 30 days after the date on which such final regulations are published. "(c) Immediate Applicability of Certain Amendments. - Notwithstanding subsection (b), the amendments made by the following provisions of this Act apply on and after the date of the enactment of this Act [Oct. 13, 1994]: sections 1001, 1021, 1031, 1051, 1071, 1092, 1201, 1506(a), 1507, 1554, 2002(a), 2191, 3062(a), 3063, 3064, 3065(a)(1), 3065(b), 3066, 3067, 6001(a), 7101, 7103, 7205, and 7206, the provisions of subtitles A, B, and C of title III [Secs. 3001-3025], and the provisions of title V [see Tables for classification]." EFFECTIVE DATE OF 1984 AMENDMENT Pub. L. 98-369, div. B, title VII, Sec. 2751, July 18, 1984, 98 Stat. 1203, provided that: "(a) Except as provided in subsection (b), the amendments made by this title [see Tables for classification] shall apply with respect to any solicitation for bids or proposals issued after March 31, 1985. "(b) The amendments made by section 2713 [amending section 759 of former Title 40, Public Buildings, Property, and Works, and enacting provisions set out as a note under section 759 of former Title 40] and subtitle D [enacting sections 3551 to 3556 of Title 31, Money and Finance] shall apply with respect to any protest filed after January 14, 1985." EFFECTIVE DATE OF 1980 AMENDMENT Amendment by Pub. L. 96-513 effective Dec. 12, 1980, see section 701(b)(3) of Pub. L. 96-513, set out as a note under section 101 of this title. EFFECTIVE DATE OF 1958 AMENDMENT Section 301(e) of Pub. L. 85-568 provided that: "This section [amending this section, section 2303 of this title, section 22-1 of former Title 5, and sections 511 to 513 and 515 of Title 50, War and National Defense, and enacting provisions set out as a note under section 2472 of Title 42, The Public Health and Welfare] shall take effect ninety days after the date of the enactment of this Act [July 29, 1958], or on any earlier date on which the Administrator [of the National Aeronautics and Space Administration] shall determine, and announce by proclamation published in the Federal Register, that the Administration has been organized and is prepared to discharge the duties and exercise the powers conferred upon it by this Act." SHORT TITLE OF 1986 AMENDMENT Section 101(c) [title X, Sec. 900] of Pub. L. 99-500 and Pub. L. 99-591, and section 900 of title IX of division A of Pub. L. 99- 661, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, provided that: "This title [enacting sections 133a, 2306a, 2325-2328, 2365-2367, 2397b, 2397c, 2408, 2409, 2416, and 2435-2437 of this title, amending sections 133, 134, 135, 138, 171, 1622, 2301, 2304, 2305, 2306, 2320, 2321, 2323, 2384, 2406, 2411, 2413, 2432, and 2433 of this title, sections 5314 and 5315 of Title 5, Government Organization and Employees, sections 632, 637, and 644 of Title 15, Commerce and Trade, and section 416 of Title 41, Public Contracts, renumbering section 2416 as 2417 of this title, enacting provisions set out as notes under sections 113, 1621, 2304, 2305, 2306a, 2320, 2323, 2325-2328, 2365-2367, 2384, 2397b, 2406, 2408, 2409, 2416, 2432, 2435-2437 of this title and section 632 of Title 15, amending provisions set out as a note under this section, and repealing provisions set out as notes under section 2304 and 2397a of this title] may be cited as the 'Defense Acquisition Improvement Act of 1986'." SHORT TITLE OF 1985 AMENDMENT Pub. L. 99-145, title IX, Sec. 901, Nov. 8, 1985, 99 Stat. 682, provided that: "This title [enacting sections 1621 to 1624, 2305a, 2324, 2397a, and 2406 of this title, amending sections 2304, 2313, 2320, 2323, 2397, and 2411 to 2415 of this title, section 759 of former Title 40, Public Buildings, Property, and Works, sections 253 and 418a of Title 41, Public Contracts, and section 2168 of Title 50, Appendix, War and National Defense, enacting provisions set out as notes under this section and sections 139, 139c, 1622 to 1624, 2304, 2305a, 2307, 2324, 2397a, and 2411 of this title, section 287 of Title 18, Crimes and Criminal Procedure, section 3729 of Title 31, Money and Finance, and section 2168 of Title 50, Appendix, and amending provisions set out as a note under section 418a of Title 41] may be cited as the 'Defense Procurement Improvement Act of 1985'." SHORT TITLE OF 1984 AMENDMENT Section 1201 of title XII of Pub. L. 98-525 provided that: "This title [enacting sections 2303a, 2317 to 2323, 2384a, 2402 to 2405, and 2411 to 2416 of this title, amending sections 139a, 139b, 2302, 2305, 2311, 2384, and 2401 of this title, enacting provisions set out as notes under this section and sections 139, 139a, 2303a, 2305, 2318, 2319, 2322, 2323, 2384, 2384a, 2392, and 2402 of this title, amending provisions set out as notes under sections 2392, 2401, and 2452 of this title, and repealing provisions set out as notes under section 2304 of this title] may be cited as the 'Defense Procurement Reform Act of 1984'." PROCUREMENT OF TENTS OR OTHER TEMPORARY STRUCTURES Pub. L. 112-81, div. A, title III, Sec. 368, Dec. 31, 2011, 125 Stat. 1381, provided that: "(a) In General. - In procuring tents or other temporary structures for use by the Armed Forces, and in establishing or maintaining an alternative source for such tents and structures, the Secretary of Defense shall award contracts that provide the best value to the United States. In determining the best value to the United States under this section, the Secretary shall consider the total life-cycle costs of such tents or structures, including the costs associated with any equipment or fuel needed to heat or cool such tents or structures. "(b) Interagency Procurement. - The requirements of this section shall apply to any agency or department of the United States that procures tents or other temporary structures on behalf of the Department of Defense." INCLUSION OF DATA ON CONTRACTOR PERFORMANCE IN PAST PERFORMANCE DATABASES FOR SOURCE SELECTION DECISIONS Pub. L. 112-81, div. A, title VIII, Sec. 806, Dec. 31, 2011, 125 Stat. 1487, provided that: "(a) Strategy on Inclusion Required. - Not later than 180 days after the date of the enactment of this Act [Dec. 31, 2011], the Under Secretary of Defense for Acquisition, Technology, and Logistics shall develop a strategy for ensuring that timely, accurate, and complete information on contractor performance is included in past performance databases used for making source selection decisions. "(b) Elements. - The strategy required by subsection (a) shall, at a minimum - "(1) establish standards for the timeliness and completeness of past performance submissions for purposes of databases described in subsection (a); "(2) assign responsibility and management accountability for the completeness of past performance submissions for such purposes; and "(3) ensure that past performance submissions for such purposes are consistent with award fee evaluations in cases where such evaluations have been conducted. "(c) Contractor Comments. - Not later than 180 days after the date of the enactment of this Act [Dec. 31, 2011], the Under Secretary of Defense for Acquisition, Technology, and Logistics shall revise the Defense Supplement to the Federal Acquisition Regulation to require the following: "(1) That affected contractors are provided, in a timely manner, information on contractor performance to be included in past performance databases in accordance with subsection (a). "(2) That such contractors are afforded up to 14 calendar days, from the date of delivery of the information provided in accordance with paragraph (1), to submit comments, rebuttals, or additional information pertaining to past performance for inclusion in such databases. "(3) That agency evaluations of contractor past performance, including any information submitted under paragraph (2), are included in the relevant past performance database not later than the date that is 14 days after the date of delivery of the information provided in accordance with paragraph (1). "(d) Construction. - Nothing in this section shall be construed to prohibit a contractor from submitting comments, rebuttals, or additional information pertaining to past performance after the period described in paragraph (2) has elapsed or to prohibit a contractor from challenging a past performance evaluation in accordance with applicable laws, regulations, or procedures. "(e) Comptroller General Report. - Not later than 18 months after the date of the enactment of this Act [Dec. 31, 2011], the Comptroller General of the United States shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report on the actions taken by the Under Secretary of Defense for Acquisition, Technology, and Logistics pursuant to this section, including an assessment of the extent to which such actions have achieved the objectives of this section." DETECTION AND AVOIDANCE OF COUNTERFEIT ELECTRONIC PARTS Pub. L. 112-81, div. A, title VIII, Sec. 818(a)-(g), Dec. 31, 2011, 125 Stat. 1493-1496, provided that: "(a) Assessment of Department of Defense Policies and Systems. - The Secretary of Defense shall conduct an assessment of Department of Defense acquisition policies and systems for the detection and avoidance of counterfeit electronic parts. "(b) Actions Following Assessment. - Not later than 180 days after the date of the enactment of the [probably should be "this"] Act [Dec. 31, 2011], the Secretary shall, based on the results of the assessment required by subsection (a) - "(1) establish Department-wide definitions of the terms 'counterfeit electronic part' and 'suspect counterfeit electronic part', which definitions shall include previously used parts represented as new; "(2) issue or revise guidance applicable to Department components engaged in the purchase of electronic parts to implement a risk-based approach to minimize the impact of counterfeit electronic parts or suspect counterfeit electronic parts on the Department, which guidance shall address requirements for training personnel, making sourcing decisions, ensuring traceability of parts, inspecting and testing parts, reporting and quarantining counterfeit electronic parts and suspect counterfeit electronic parts, and taking corrective actions (including actions to recover costs as described in subsection (c)(2)); "(3) issue or revise guidance applicable to the Department on remedial actions to be taken in the case of a supplier who has repeatedly failed to detect and avoid counterfeit electronic parts or otherwise failed to exercise due diligence in the detection and avoidance of such parts, including consideration of whether to suspend or debar a supplier until such time as the supplier has effectively addressed the issues that led to such failures; "(4) establish processes for ensuring that Department personnel who become aware of, or have reason to suspect, that any end item, component, part, or material contained in supplies purchased by or for the Department contains counterfeit electronic parts or suspect counterfeit electronic parts provide a report in writing within 60 days to appropriate Government authorities and to the Government-Industry Data Exchange Program (or a similar program designated by the Secretary); and "(5) establish a process for analyzing, assessing, and acting on reports of counterfeit electronic parts and suspect counterfeit electronic parts that are submitted in accordance with the processes under paragraph (4). "(c) Regulations. - "(1) In general. - Not later than 270 days after the date of the enactment of this Act [Dec. 31, 2011], the Secretary shall revise the Department of Defense Supplement to the Federal Acquisition Regulation to address the detection and avoidance of counterfeit electronic parts. "(2) Contractor responsibilities. - The revised regulations issued pursuant to paragraph (1) shall provide that - "(A) covered contractors who supply electronic parts or products that include electronic parts are responsible for detecting and avoiding the use or inclusion of counterfeit electronic parts or suspect counterfeit electronic parts in such products and for any rework or corrective action that may be required to remedy the use or inclusion of such parts; and "(B) the cost of counterfeit electronic parts and suspect counterfeit electronic parts and the cost of rework or corrective action that may be required to remedy the use or inclusion of such parts are not allowable costs under Department contracts. "(3) Trusted suppliers. - The revised regulations issued pursuant to paragraph (1) shall - "(A) require that, whenever possible, the Department and Department contractors and subcontractors at all tiers - "(i) obtain electronic parts that are in production or currently available in stock from the original manufacturers of the parts or their authorized dealers, or from trusted suppliers who obtain such parts exclusively from the original manufacturers of the parts or their authorized dealers; and "(ii) obtain electronic parts that are not in production or currently available in stock from trusted suppliers; "(B) establish requirements for notification of the Department, and inspection, testing, and authentication of electronic parts that the Department or a Department contractor or subcontractor obtains from any source other than a source described in subparagraph (A); "(C) establish qualification requirements, consistent with the requirements of section 2319 of title 10, United States Code, pursuant to which the Department may identify trusted suppliers that have appropriate policies and procedures in place to detect and avoid counterfeit electronic parts and suspect counterfeit electronic parts; and "(D) authorize Department contractors and subcontractors to identify and use additional trusted suppliers, provided that - "(i) the standards and processes for identifying such trusted suppliers comply with established industry standards; "(ii) the contractor or subcontractor assumes responsibility for the authenticity of parts provided by such suppliers as provided in paragraph (2); and "(iii) the selection of such trusted suppliers is subject to review and audit by appropriate Department officials. "(4) Reporting requirement. - The revised regulations issued pursuant to paragraph (1) shall require that any Department contractor or subcontractor who becomes aware, or has reason to suspect, that any end item, component, part, or material contained in supplies purchased by the Department, or purchased by a contractor or subcontractor for delivery to, or on behalf of, the Department, contains counterfeit electronic parts or suspect counterfeit electronic parts report in writing within 60 days to appropriate Government authorities and the Government- Industry Data Exchange Program (or a similar program designated by the Secretary). "(5) Construction of compliance with reporting requirement. - A Department contractor or subcontractor that provides a written report required under this subsection shall not be subject to civil liability on the basis of such reporting, provided the contractor or subcontractor made a reasonable effort to determine that the end item, component, part, or material concerned contained counterfeit electronic parts or suspect counterfeit electronic parts. "(d) Inspection Program. - The Secretary of Homeland Security shall establish and implement a risk-based methodology for the enhanced targeting of electronic parts imported from any country, after consultation with the Secretary of Defense as to sources of counterfeit electronic parts and suspect counterfeit electronic parts in the supply chain for products purchased by the Department of Defense. "(e) Improvement of Contractor Systems for Detection and Avoidance of Counterfeit Electronic Parts. - "(1) In general. - Not later than 270 days after the date of the enactment of this Act [Dec. 31, 2011], the Secretary of Defense shall implement a program to enhance contractor detection and avoidance of counterfeit electronic parts. "(2) Elements. - The program implemented pursuant to paragraph (1) shall - "(A) require covered contractors that supply electronic parts or systems that contain electronic parts to establish policies and procedures to eliminate counterfeit electronic parts from the defense supply chain, which policies and procedures shall address - "(i) the training of personnel; "(ii) the inspection and testing of electronic parts; "(iii) processes to abolish counterfeit parts proliferation; "(iv) mechanisms to enable traceability of parts; "(v) use of trusted suppliers; "(vi) the reporting and quarantining of counterfeit electronic parts and suspect counterfeit electronic parts; "(vii) methodologies to identify suspect counterfeit parts and to rapidly determine if a suspect counterfeit part is, in fact, counterfeit; "(viii) the design, operation, and maintenance of systems to detect and avoid counterfeit electronic parts and suspect counterfeit electronic parts; and "(ix) the flow down of counterfeit avoidance and detection requirements to subcontractors; and "(B) establish processes for the review and approval of contractor systems for the detection and avoidance of counterfeit electronic parts and suspect counterfeit electronic parts, which processes shall be comparable to the processes established for contractor business systems under section 893 of the Ike Skelton National Defense Authorization Act for Fiscal Year 2011 (Public Law 111-383; 124 Stat. 4311; 10 U.S.C. 2302 note). "(f) Definitions. - In subsections (a) through (e) of this section: "(1) The term 'covered contractor' has the meaning given that term in section 893(f)(2) of the Ike Skelton National Defense Authorization Act for Fiscal Year 2011. "(2) The term 'electronic part' means an integrated circuit, a discrete electronic component (including, but not limited to, a transistor, capacitor, resistor, or diode), or a circuit assembly. "(g) Information Sharing. - "(1) In general. - If United States Customs and Border Protection suspects a product of being imported in violation of section 42 of the Lanham Act [15 U.S.C. 1124], and subject to any applicable bonding requirements, the Secretary of the Treasury may share information appearing on, and unredacted samples of, products and their packaging and labels, or photographs of such products, packaging, and labels, with the rightholders of the trademarks suspected of being copied or simulated for purposes of determining whether the products are prohibited from importation pursuant to such section. "(2) Sunset. - This subsection shall expire on the date of the enactment of the Customs Facilitation and Trade Enforcement Reauthorization Act of 2012. "(3) Lanham act defined. - In this subsection, the term 'Lanham Act' means the Act entitled 'An Act to provide for the registration and protection of trademarks used in commerce, to carry out the provisions of certain international conventions, and for other purposes', approved July 5, 1946 (commonly referred to as the 'Trademark Act of 1946' or the 'Lanham Act') [15 U.S.C. 1051 et seq.]." PROHIBITION ON CONTRACTING WITH THE ENEMY IN THE UNITED STATES CENTRAL COMMAND THEATER OF OPERATIONS Pub. L. 112-81, div. A, title VIII, Sec. 841, Dec. 31, 2011, 125 Stat. 1510, provided that: "(a) Prohibition. - "(1) In general. - Not later than 30 days after the date of the enactment of this Act [Dec. 31, 2011], the Secretary of Defense shall revise the Department of Defense Supplement to the Federal Acquisition Regulation to authorize the head of a contracting activity, pursuant to a request from the Commander of the United States Central Command under subsection (c)(2) - "(A) to restrict the award of Department of Defense contracts, grants, or cooperative agreements that the head of the contracting activity determines in writing would provide funding directly or indirectly to a person or entity that has been identified by the Commander of the United States Central Command as actively supporting an insurgency or otherwise actively opposing United States or coalition forces in a contingency operation in the United States Central Command theater of operations; "(B) to terminate for default any Department contract, grant, or cooperative agreement upon a written determination by the head of the contracting activity that the contractor, or the recipient of the grant or cooperative agreement, has failed to exercise due diligence to ensure that none of the funds received under the contract, grant, or cooperative agreement are provided directly or indirectly to a person or entity who is actively supporting an insurgency or otherwise actively opposing United States or coalition forces in a contingency operation in the United States Central Command theater of operations; or "(C) to void in whole or in part any Department contract, grant, or cooperative agreement upon a written determination by the head of the contracting activity that the contract, grant, or cooperative agreement provides funding directly or indirectly to a person or entity that has been identified by the Commander of the United States Central Command as actively supporting an insurgency or otherwise actively opposing United States or coalition forces in a contingency operation in the United States Central Command theater of operations. "(2) Treatment as void. - For purposes of this section: "(A) A contract, grant, or cooperative agreement that is void is unenforceable as contrary to public policy. "(B) A contract, grant, or cooperative agreement that is void in part is unenforceable as contrary to public policy with regard to a segregable task or effort under the contract, grant, or cooperative agreement. "(b) Contract Clause. - "(1) In general. - Not later than 30 days after the date of the enactment of this Act [Dec. 31, 2011], the Secretary shall revise the Department of Defense Supplement to the Federal Acquisition Regulation to require that - "(A) the clause described in paragraph (2) shall be included in each covered contract, grant, and cooperative agreement of the Department that is awarded on or after the date of the enactment of this Act; and "(B) to the maximum extent practicable, each covered contract, grant, and cooperative agreement of the Department that is awarded before the date of the enactment of this Act shall be modified to include the clause described in paragraph (2). "(2) Clause described. - The clause described in this paragraph is a clause that - "(A) requires the contractor, or the recipient of the grant or cooperative agreement, to exercise due diligence to ensure that none of the funds received under the contract, grant, or cooperative agreement are provided directly or indirectly to a person or entity who is actively supporting an insurgency or otherwise actively opposing United States or coalition forces in a contingency operation; and "(B) notifies the contractor, or the recipient of the grant or cooperative agreement, of the authority of the head of the contracting activity to terminate or void the contract, grant, or cooperative agreement, in whole or in part, as provided in subsection (a). "(3) Covered contract, grant, or cooperative agreement. - In this subsection, the term 'covered contract, grant, or cooperative agreement' means a contract, grant, or cooperative agreement with an estimated value in excess of $100,000 that will be performed in the United States Central Command theater of operations. "(c) Identification of Contracts With Supporters of the Enemy. - "(1) In general. - Not later than 30 days after the date of the enactment of this Act [Dec. 31, 2011], the Secretary, acting through the Commander of the United States Central Command, shall establish a program to use available intelligence to review persons and entities who receive United States funds through contracts, grants, and cooperative agreements performed in the United States Central Command theater of operations and identify any such persons and entities who are actively supporting an insurgency or otherwise actively opposing United States or coalition forces in a contingency operation. "(2) Notice to contracting activities. - If the Commander of the United States Central Command, acting pursuant to the program required by paragraph (1), identifies a person or entity as actively supporting an insurgency or otherwise actively opposing United States or coalition forces in a contingency operation, the Commander may notify the head of a contracting activity in writing of such identification and request that the head of the contracting activity exercise the authority provided in subsection (a) with regard to any contracts, grants, or cooperative agreements that provide funding directly or indirectly to the person or entity. "(3) Protection of classified information. - Classified information relied upon by the Commander of the United States Central Command to make an identification in accordance with this subsection may not be disclosed to a contractor or a recipient of a grant or cooperative agreement with respect to which an action is taken pursuant to the authority provided in subsection (a), or to their representatives, in the absence of a protective order issued by a court of competent jurisdiction established under Article III of the Constitution of the United States that specifically addresses the conditions upon which such classified information may be so disclosed. "(d) Nondelegation of Responsibilities. - "(1) Contract actions. - The authority provided by subsection (a) to restrict, terminate, or void contracts, grants, and cooperative agreements may not be delegated below the level of the head of a contracting activity. "(2) Identification of support of enemy. - The authority to make an identification under subsection (c)(1) may not be delegated below the level of the Commander of the United States Central Command. "(e) Reports. - Not later than March 1 of each of 2013, 2014, and 2015, the Secretary shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report on the use of the authority provided by this section in the preceding calendar year. Each report shall identify, for the calendar year covered by such report, each instance in which the Department of Defense exercised the authority to restrict, terminate, or void contracts, grants, and cooperative agreements pursuant to subsection (a) and explain the basis for the action taken. Any report under this subsection may be submitted in classified form. "(f) Other Definition. - In this section, the term 'contingency operation' has the meaning given that term in section 101(a)(13) of title 10, United States Code. "(g) Sunset. - The authority to restrict, terminate, or void contracts, grants, and cooperative agreements pursuant to subsection (a) shall cease to be effective on the date that is three years after the date of the enactment of this Act [Dec. 31, 2011]." REACH-BACK CONTRACTING AUTHORITY FOR OPERATION ENDURING FREEDOM AND OPERATION NEW DAWN Pub. L. 112-81, div. A, title VIII, Sec. 843, Dec. 31, 2011, 125 Stat. 1514, provided that: "(a) Authority To Designate Lead Contracting Activity. - The Under Secretary of Defense for Acquisition, Technology, and Logistics may designate a single contracting activity inside the United States to act as the lead contracting activity with authority for use of domestic capabilities in support of overseas contracting for Operation Enduring Freedom and Operation New Dawn. The contracting activity so designated shall be known as the 'lead reach-back contracting authority' for such operations. "(b) Limited Authority for Use of Outside-the-United-States- thresholds. - The head of the contracting authority designated pursuant to subsection (a) may, when awarding a contract inside the United States for performance in the theater of operations for Operation Enduring Freedom or Operation New Dawn, use the overseas increased micro-purchase threshold and the overseas increased simplified acquisition threshold in the same manner and to the same extent as if the contract were to be awarded and performed outside the United States. "(c) Definitions. - In this section: "(1) The term 'overseas increased micro-purchase threshold' means the amount specified in paragraph (1)(B) of section 1903(b) of title 41, United States Code. "(2) The term 'overseas increased simplified acquisition threshold' means the amount specified in paragraph (2)(B) of section 1903(b) of title 41, United States Code." COMPETITION AND REVIEW OF CONTRACTS FOR PROPERTY OR SERVICES IN SUPPORT OF A CONTINGENCY OPERATION Pub. L. 112-81, div. A, title VIII, Sec. 844(a), (b), Dec. 31, 2011, 125 Stat. 1515, provided that: "(a) Contracting Goals. - Not later than 90 days after the date of the enactment of this Act [Dec. 31, 2011], the Secretary of Defense shall - "(1) establish goals for competition in contracts awarded by the Secretary of Defense for the procurement of property or services to be used outside the United States in support of a contingency operation; and "(2) develop processes by which to measure and monitor such competition, including in task-order categories for services, construction, and supplies. "(b) Annual Review of Certain Contracts. - For each year the Logistics Civil Augmentation Program contract, or other similar omnibus contract awarded by the Secretary of Defense for the procurement of property or services to be used outside the United States in support of a contingency operation, is in force, the Secretary shall require a competition advocate of the Department of Defense to conduct an annual review of each such contract." CONTRACTS FOR COMMERCIAL IMAGING SATELLITE CAPACITIES Pub. L. 111-383, div. A, title I, Sec. 127, Jan. 7, 2011, 124 Stat. 4161, provided that: "(a) Telescope Requirements Under Contracts After 2010. - Except as provided in subsection (b), any contract for additional commercial imaging satellite capability or capacity entered into by the Department of Defense after December 31, 2010, shall require that the imaging telescope providing such capability or capacity under such contract has an aperture of not less than 1.5 meters. "(b) Waiver. - The Secretary of Defense may waive the limitation in subsection (a) if - "(1) the Secretary submits to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] written certification that the waiver is in the national security interests of the United States; and "(2) a period of 30 days has elapsed following the date on which the certification under paragraph (1) is submitted. "(c) Continuation of Current Contracts. - The limitation in subsection (a) may not be construed to prohibit or prevent the Secretary of Defense from continuing or maintaining current commercial imaging satellite capability or capacity in orbit or under contract by December 31, 2010." REVIEW OF ACQUISITION PROCESS FOR RAPID FIELDING OF CAPABILITIES IN RESPONSE TO URGENT OPERATIONAL NEEDS Pub. L. 111-383, div. A, title VIII, Sec. 804, Jan. 7, 2011, 124 Stat. 4256, provided that: "(a) Review of Rapid Acquisition Process Required. - "(1) In general. - Not later than one year after the date of the enactment of this Act [Jan. 7, 2011], the Secretary of Defense shall complete a review of the process for the fielding of capabilities in response to urgent operational needs and submit a report on the review to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives]. "(2) Review and report requirements. - The review pursuant to this section shall include consideration of various improvements to the acquisition process for rapid fielding of capabilities in response to urgent operational needs. For each improvement, the report on the review shall discuss - "(A) the Department's review of the improvement; "(B) if the improvement is being implemented by the Department, a schedule for implementing the improvement; and "(C) if the improvement is not being implemented by the Department, an explanation of why the improvement is not being implemented. "(3) Improvements to be considered. - The improvements that shall be considered during the review are the following: "(A) Providing a streamlined, expedited, and tightly integrated iterative approach to - "(i) the identification and validation of urgent operational needs; "(ii) the analysis of alternatives and identification of preferred solutions; "(iii) the development and approval of appropriate requirements and acquisition documents; "(iv) the identification and minimization of development, integration, and manufacturing risks; "(v) the consideration of operation and sustainment costs; "(vi) the allocation of appropriate funding; and "(vii) the rapid production and delivery of required capabilities. "(B) Clearly defining the roles and responsibilities of the Office of the Secretary of Defense, the Joint Chiefs of Staff, the military departments, and other components of the Department of Defense for carrying out all phases of the process. "(C) Designating a senior official within the Office of the Secretary of Defense with primary responsibility for making recommendations to the Secretary on the use of the authority provided by subsections (c) and (d) of section 806 of the Bob Stump National Defense Authorization Act for Fiscal Year 2003 [Pub. L. 107-314] (10 U.S.C. 2302 note), as amended by section 803 of this Act, in appropriate circumstances. "(D) Establishing a target date for the fielding of a capability pursuant to each validated urgent operational need. "(E) Implementing a system for - "(i) documenting key process milestones, such as funding, acquisition, fielding, and assessment decisions and actions; and "(ii) tracking the cost, schedule, and performance of acquisitions conducted pursuant to the process. "(F) Establishing a formal feedback mechanism for the commanders of the combatant commands to provide information to the Joint Chiefs of Staff and senior acquisition officials on how well fielded solutions are meeting urgent operational needs. "(G) Establishing a dedicated source of funding for the rapid fielding of capabilities in response to urgent operational needs. "(H) Issuing guidance to provide for the appropriate transition of capabilities acquired through rapid fielding into the traditional budget, requirements, and acquisition process for purposes of contracts for follow-on production, sustainment, and logistics support. "(I) Such other improvements as the Secretary considers appropriate. "(b) Discriminating Urgent Operational Needs From Traditional Requirements. - "(1) Expedited review process. - Not later than 270 days after the date of the enactment of this Act, the Secretary shall develop and implement an expedited review process to determine whether capabilities proposed as urgent operational needs are appropriate for fielding through the process for the rapid fielding of capabilities or should be fielded through the traditional acquisition process. "(2) Elements. - The review process developed and implemented pursuant to paragraph (1) shall - "(A) apply to the rapid fielding of capabilities in response to joint urgent operational need statements and to other urgent operational needs statements generated by the military departments and the combatant commands; "(B) identify officials responsible for making determinations described in paragraph (1); "(C) establish appropriate time periods for making such determinations; "(D) set forth standards and criteria for making such determinations based on considerations of urgency, risk, and life-cycle management; "(E) establish appropriate thresholds for the applicability of the review process, or of elements of the review process; and "(F) authorize appropriate officials to make exceptions from standards and criteria established under subparagraph (D) in exceptional circumstances. "(3) Covered capabilities. - The review process developed and implemented pursuant to paragraph (1) shall provide that, subject to such exceptions as the Secretary considers appropriate for purposes of this section, the acquisition process for rapid fielding of capabilities in response to urgent operational needs is appropriate only for capabilities that - "(A) can be fielded within a period of two to 24 months; "(B) do not require substantial development effort; "(C) are based on technologies that are proven and available; and "(D) can appropriately be acquired under fixed price contracts. "(4) Inclusion in report. - The Secretary shall include a description of the expedited review process implemented pursuant to paragraph (1) in the report required by subsection (a)." STANDARDS AND CERTIFICATION FOR PRIVATE SECURITY CONTRACTORS Pub. L. 111-383, div. A, title VIII, Sec. 833, Jan. 7, 2011, 124 Stat. 4276, provided that: "(a) Review of Third-Party Standards and Certification Processes. - Not later than 90 days after the date of the enactment of this Act [Jan. 7, 2011], the Secretary of Defense shall - "(1) determine whether the private sector has developed - "(A) operational and business practice standards applicable to private security contractors; and "(B) third-party certification processes for determining whether private security contractors adhere to standards described in subparagraph (A); and "(2) review any standards and processes identified pursuant to paragraph (1) to determine whether the application of such standards and processes will make a substantial contribution to the successful performance of private security functions in areas of combat operations or other significant military operations. "(b) Revised Regulations. - Not later than 270 days after the date of the enactment of this Act, the Secretary of Defense shall revise the regulations promulgated under section 862 of the National Defense Authorization Act for Fiscal Year 2008 (Public Law 110-181; 10 U.S.C. 2302 note) to ensure that such regulations - "(1) establish criteria for defining standard practices for the performance of private security functions, which shall reflect input from industry representatives as well as the Inspector General of the Department of Defense; and "(2) establish criteria for weapons training programs for contractors performing private security functions, including minimum requirements for weapons training programs of instruction and minimum qualifications for instructors for such programs. "(c) Inclusion of Third-Party Standards and Certifications in Revised Regulations. - "(1) Standards. - If the Secretary determines that the application of operational and business practice standards identified pursuant to subsection (a)(1)(A) will make a substantial contribution to the successful performance of private security functions in areas of combat operations or other significant military operations, the revised regulations promulgated pursuant to subsection (b) shall incorporate a requirement to comply with such standards, subject to such exceptions as the Secretary may determine to be necessary. "(2) Certifications. - If the Secretary determines that the application of a third-party certification process identified pursuant to subsection (a)(1)(B) will make a substantial contribution to the successful performance of private security functions in areas of combat operations or other significant military operations, the revised regulations promulgated pursuant to subsection (b) may provide for the consideration of such certifications as a factor in the evaluation of proposals for award of a covered contract for the provision of private security functions, subject to such exceptions as the Secretary may determine to be necessary. "(d) Definitions. - In this section: "(1) Covered contract. - The term 'covered contract' means - "(A) a contract of the Department of Defense for the performance of services; "(B) a subcontract at any tier under such a contract; or "(C) a task order or delivery order issued under such a contract or subcontract. "(2) Contractor. - The term 'contractor' means, with respect to a covered contract, the contractor or subcontractor carrying out the covered contract. "(3) Private security functions. - The term 'private security functions' means activities engaged in by a contractor under a covered contract as follows: "(A) Guarding of personnel, facilities, or property of a Federal agency, the contractor or subcontractor, or a third party. "(B) Any other activity for which personnel are required to carry weapons in the performance of their duties. "(e) Exception. - The requirements of this section shall not apply to contracts entered into by elements of the intelligence community in support of intelligence activities." PILOT PROGRAM ON ACQUISITION OF MILITARY PURPOSE NONDEVELOPMENTAL ITEMS Pub. L. 111-383, div. A, title VIII, Sec. 866(a)-(f), Jan. 7, 2011, 124 Stat. 4296-4298, provided that: "(a) Pilot Program Authorized. - "(1) In general. - The Secretary of Defense may carry out a pilot program to assess the feasability [sic] and advisability of acquiring military purpose nondevelopmental items in accordance with this section. "(2) Scope of program. - Under the pilot program, the Secretary may enter into contracts with nontraditional defense contractors for the acquisition of military purpose nondevelopmental items in accordance with the requirements set forth in subsection (b). "(b) Contract Requirements. - Each contract entered into under the pilot program - "(1) shall be a firm, fixed price contract, or a firm, fixed price contract with an economic price adjustment clause awarded using competitive procedures in accordance with chapter 137 of title 10, United States Code; "(2) shall be in an amount not in excess of $50,000,000, including all options; "(3) shall provide - "(A) for the delivery of an initial lot of production quantities of completed items not later than nine months after the date of the award of such contract; and "(B) that failure to make delivery as provided for under subparagraph (A) may result in the termination of such contract for default; and "(4) shall be - "(A) exempt from the requirement to submit certified cost or pricing data under section 2306a of title 10, United States Code, and the cost accounting standards under section 26 of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 422) [now 41 U.S.C. 1501 et seq.]; and "(B) subject to the requirement to provide data other than certified cost or pricing data for the purpose of price reasonableness determinations, as provided in section 2306a(d) of title 10, United States Code. "(c) Regulations. - If the Secretary establishes the pilot program authorized under subsection (a), the Secretary shall prescribe regulations governing such pilot program. Such regulations shall be included in regulations of the Department of Defense prescribed as part of the Federal Acquisition Regulation and shall include the contract clauses and procedures necessary to implement such program. "(d) Reports. - "(1) Reports on program activities. - Not later than 60 days after the end of any fiscal year in which the pilot program is in effect, the Secretary shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report on the pilot program. The report shall be in unclassified form but may include a classified annex. Each report shall include, for each contract entered into under the pilot program in the preceding fiscal year, the following: "(A) The contractor. "(B) The item or items to be acquired. "(C) The military purpose to be served by such item or items. "(D) The amount of the contract. "(E) The actions taken by the Department of Defense to ensure that the price paid for such item or items is fair and reasonable. "(2) Program assessment. - If the Secretary establishes the pilot program authorized under subsection (a), not later than four years after the date of the enactment of this Act, the Comptroller General of the United States shall submit to the congressional defense committees a report setting forth the assessment of the Comptroller General of the extent to which the pilot program - "(A) enabled the Department to acquire items that otherwise might not have been available to the Department; "(B) assisted the Department in the rapid acquisition and fielding of capabilities needed to meet urgent operational needs; and "(C) protected the interests of the United States in paying fair and reasonable prices for the item or items acquired. "(e) Definitions. - In this section: "(1) The term 'military purpose nondevelopmental item' means a nondevelopmental item that meets a validated military requirement, as determined in writing by the responsible program manager, and has been developed exclusively at private expense. For purposes of this paragraph, an item shall not be considered to be developed exclusively at private expense if development of the item was paid for in whole or in part through - "(A) independent research and development costs or bid and proposal costs that have been reimbursed directly or indirectly by a Federal agency or have been submitted to a Federal agency for reimbursement; or "(B) foreign government funding. "(2) The term 'nondevelopmental item' - "(A) has the meaning given that term in section 4(13) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 403(13)) [see 41 U.S.C. 110]; and "(B) also includes previously developed items of supply that require modifications other than those customarily available in the commercial marketplace if such modifications are consistent with the requirement in subsection (b)(3)(A). "(3) The term 'nontraditional defense contractor' has the meaning given that term in section 2302(9) of title 10, United States Code (as added by subsection (g)). "(4) The terms 'independent research and developments costs' and 'bid and proposal costs' have the meaning given such terms in section 31.205-18 of the Federal Acquisition Regulation. "(f) Sunset. - "(1) In general. - The authority to carry out the pilot program shall expire on the date that is five years after the date of the enactment of this Act. "(2) Continuation of current contracts. - The expiration under paragraph (1) of the authority to carry out the pilot program shall not affect the validity of any contract awarded under the pilot program before the date of the expiration of the pilot program under that paragraph." CONTRACTOR BUSINESS SYSTEMS Pub. L. 111-383, div. A, title VIII, Sec. 893, Jan. 7, 2011, 124 Stat. 4311, as amended by Pub. L. 112-81, div. A, title VIII, Sec. 816, Dec. 31, 2011, 125 Stat. 1493, provided that: "(a) Improvement Program. - Not later than 270 days after the date of the enactment of this Act [Jan. 7, 2011], the Secretary of Defense shall develop and initiate a program for the improvement of contractor business systems to ensure that such systems provide timely, reliable information for the management of Department of Defense programs by the contractor and by the Department. "(b) Approval or Disapproval of Business Systems. - The program developed pursuant to subsection (a) shall - "(1) include system requirements for each type of contractor business system covered by the program; "(2) establish a process for reviewing contractor business systems and identifying significant deficiencies in such systems; "(3) identify officials of the Department of Defense who are responsible for the approval or disapproval of contractor business systems; "(4) provide for the approval of any contractor business system that does not have a significant deficiency; and "(5) provide for - "(A) the disapproval of any contractor business system that has a significant deficiency; and "(B) reduced reliance on, and enhanced scrutiny of, data provided by a contractor business system that has been disapproved. "(c) Remedial Actions. - The program developed pursuant to subsection (a) shall provide the following: "(1) In the event a contractor business system is disapproved pursuant to subsection (b)(5), appropriate officials of the Department of Defense will be available to work with the contractor to develop a corrective action plan defining specific actions to be taken to address the significant deficiencies identified in the system and a schedule for the implementation of such actions. "(2) An appropriate official of the Department of Defense may withhold up to 10 percent of progress payments, performance-based payments, and interim payments under covered contracts from a covered contractor, as needed to protect the interests of the Department and ensure compliance, if one or more of the contractor business systems of the contractor has been disapproved pursuant to subsection (b)(5) and has not subsequently received approval. "(3) The amount of funds to be withheld under paragraph (2) shall be reduced if a contractor adopts an effective corrective action plan pursuant to paragraph (1) and is effectively implementing such plan. "(d) Guidance and Training. - The program developed pursuant to subsection (a) shall provide guidance and training to appropriate government officials on the data that is produced by contractor business systems and the manner in which such data should be used to effectively manage Department of Defense programs. "(e) Rule of Construction. - Nothing in this section shall be construed to prohibit an official of the Department of Defense from reviewing, approving, or disapproving a contractor business system pursuant to any applicable law or regulation in force as of the date of the enactment of this Act during the period between the date of the enactment of this Act and the date on which the Secretary implements the requirements of this section with respect to such system. "(f) Definitions. - In this section: "(1) The term 'contractor business system' means an accounting system, estimating system, purchasing system, earned value management system, material management and accounting system, or property management system of a contractor. "(2) The term 'covered contractor' means a contractor that is subject to the cost accounting standards under section 26 of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 422) [now 41 U.S.C. 1501 et seq.]. "(3) The term 'covered contract' means a contract that is subject to the cost accounting standards promulgated pursuant to section 1502 of title 41, United States Code, that could be affected if the data produced by a contractor business system has a significant deficiency. "(4) The term 'significant deficiency', in the case of a contractor business system, means a shortcoming in the system that materially affects the ability of officials of the Department of Defense and the contractor to rely upon information produced by the system that is needed for management purposes. "(g) Defense Contract Audit Agency Legal Resources and Expertise. - "(1) Requirement. - The Secretary of Defense shall ensure that - "(A) the Defense Contract Audit Agency has sufficient legal resources and expertise to conduct its work in compliance with applicable Department of Defense policies and procedures; and "(B) such resources and expertise are provided in a manner that is consistent with the audit independence of the Defense Contract Audit Agency. "(2) Report. - Not later than 180 days after the date of the enactment of this Act, the Secretary shall submit to the Committees on Armed Services of the Senate and the House of Representatives a report on the steps taken to comply with the requirements of this subsection." LIFE-CYCLE MANAGEMENT AND PRODUCT SUPPORT Pub. L. 111-84, div. A, title VIII, Sec. 805, Oct. 28, 2009, 123 Stat. 2403, provided that: "(a) Guidance on Life-cycle Management. - Not later than 180 days after the date of the enactment of this Act [Oct. 28, 2009], the Secretary of Defense shall issue comprehensive guidance on life- cycle management and the development and implementation of product support strategies for major weapon systems. The guidance issued pursuant to this subsection shall - "(1) maximize competition and make the best possible use of available Department of Defense and industry resources at the system, subsystem, and component levels; and "(2) maximize value to the Department of Defense by providing the best possible product support outcomes at the lowest operations and support cost. "(b) Product Support Managers. - "(1) Requirement. - The Secretary of Defense shall require that each major weapon system be supported by a product support manager in accordance with this subsection. "(2) Responsibilities. - A product support manager for a major weapon system shall - "(A) develop and implement a comprehensive product support strategy for the weapon system; "(B) conduct appropriate cost analyses to validate the product support strategy, including cost-benefit analyses as outlined in Office of Management and Budget Circular A-94; "(C) assure achievement of desired product support outcomes through development and implementation of appropriate product support arrangements; "(D) adjust performance requirements and resource allocations across product support integrators and product support providers as necessary to optimize implementation of the product support strategy; "(E) periodically review product support arrangements between the product support integrators and product support providers to ensure the arrangements are consistent with the overall product support strategy; and "(F) prior to each change in the product support strategy or every five years, whichever occurs first, revalidate any business-case analysis performed in support of the product support strategy. "(c) Government Performance of Product Support Manager Function. - [Amended section 820(a) of Pub. L. 109-364, set out as a note under section 1701 of this title.] "(d) Definitions. - In this section: "(1) The term 'product support' means the package of support functions required to field and maintain the readiness and operational capability of major weapon systems, subsystems, and components, including all functions related to weapon system readiness. "(2) The term 'product support arrangement' means a contract, task order, or any type of other contractual arrangement, or any type of agreement or non-contractual arrangement within the Federal Government, for the performance of sustainment or logistics support required for major weapon systems, subsystems, or components. The term includes arrangements for any of the following: "(A) Performance-based logistics. "(B) Sustainment support. "(C) Contractor logistics support. "(D) Life-cycle product support. "(E) Weapon systems product support. "(3) The term 'product support integrator' means an entity within the Federal Government or outside the Federal Government charged with integrating all sources of product support, both private and public, defined within the scope of a product support arrangement. "(4) The term 'product support provider' means an entity that provides product support functions. The term includes an entity within the Department of Defense, an entity within the private sector, or a partnership between such entities. "(5) The term 'major weapon system' has the meaning given that term in section 2302d of title 10, United States Code." CONTRACT AUTHORITY FOR ADVANCED COMPONENT DEVELOPMENT OR PROTOTYPE UNITS Pub. L. 111-84, div. A, title VIII, Sec. 819, Oct. 28, 2009, 123 Stat. 2409, provided that: "(a) Authority. - A contract initially awarded from the competitive selection of a proposal resulting from a general solicitation referred to in section 2302(2)(B) of title 10, United States Code, may contain a contract line item or contract option for - "(1) the provision of advanced component development or prototype of technology developed under the contract; or "(2) the delivery of initial or additional prototype items if the item or a prototype thereof is created as the result of work performed under the contract. "(b) Limitations. - "(1) Minimal amount. - A contract line item or contract option described in subsection (a)(2) shall require the delivery of the minimal amount of initial or additional prototype items to allow for the timely competitive solicitation and award of a follow-on development or production contract for those items. "(2) Term. - A contract line item or contract option described in subsection (a) shall be for a term of not more than 12 months. "(3) Dollar value of work. - The dollar value of the work to be performed pursuant to a contract line item or contract option described in subsection (a) may not exceed the lesser of the amounts as follows: "(A) The amount that is three times the dollar value of the work previously performed under the contract. "(B) $20,000,000. "(4) Termination of authority. - A military department or defense agency may not exercise a contract line item or contract option pursuant to the authority provided in subsection (a) after September 30, 2014. "(c) Report. - The Secretary of Defense shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report on the use of the authority provided by subsection (a) not later than March 1, 2013. The report shall, at a minimum, describe - "(1) the number of times a contract line item or contract option was exercised under such authority, the dollar amount of each such line item or option, and the scope of each such line item or option; "(2) the circumstances that rendered the military department or defense agency unable to solicit and award a follow-on development or production contract in a timely fashion, but for the use of such authority; "(3) the extent to which such authority affected competition and technology transition; and "(4) such recommendations as the Secretary considers appropriate, including any recommendations regarding the modification or extension of such authority." CONGRESSIONAL EARMARKS Pub. L. 111-84, div. A, title X, Sec. 1062, Oct. 28, 2009, 123 Stat. 2468, provided that: "(a) Report on Recurring Earmarks. - "(1) Report required. - Not later than 90 days after the date of the enactment of this Act [Oct. 28, 2009], the Secretary of Defense shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report regarding covered earmarks. "(2) Elements. - The report required by paragraph (1) shall include the following: "(A) An identification of each covered earmark that has been included in a national defense authorization Act for three or more consecutive fiscal years as of the date of the enactment of this Act. "(B) A description of the extent to which competitive or merit-based procedures were used to award funding, or to enter into a contract, grant, or other agreement, pursuant to each covered earmark. "(C) An identification of the specific contracting vehicle used for each covered earmark. "(D) In the case of any covered earmark for which competitive or merit-based procedures were not used to award funding, or to enter into the contract, grant, or other agreement, a statement of the reasons competitive or merit-based procedures were not used. "(b) DoD Inspector General Audit of Congressional Earmarks. - The Inspector General of the Department of Defense shall conduct an audit of contracts, grants, or other agreements pursuant to congressional earmarks of Department of Defense funds to determine whether or not the recipients of such earmarks are complying with requirements of Federal law on the use of appropriated funds to influence, whether directly or indirectly, congressional action on any legislation or appropriation matter pending before Congress. "(c) Definitions. - In this section: "(1) The term 'congressional earmark' means any congressionally directed spending item (Senate) or congressional earmark (House of Representatives) on a list published in compliance with rule XLIV of the Standing Rules of the Senate or rule XXI of the Rules of the House of Representatives. "(2) The term 'covered earmark' means any congressional earmark identified in the joint explanatory statement to accompany the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 (Public Law 110-417) that was printed in the Congressional Record on September 23, 2008. "(3) The term 'national defense authorization Act' means an Act authorizing funds for a fiscal year for the military activities of the Department of Defense, and for other purposes." CONSIDERATION OF TRADE-OFFS AMONG COST, SCHEDULE, AND PERFORMANCE OBJECTIVES IN DEPARTMENT OF DEFENSE ACQUISITION PROGRAMS Pub. L. 111-23, title II, Sec. 201(a), May 22, 2009, 123 Stat. 1719, provided that: "(1) In general. - The Secretary of Defense shall ensure that mechanisms are developed and implemented to require consideration of trade-offs among cost, schedule, and performance objectives as part of the process for developing requirements for Department of Defense acquisition programs. "(2) Elements. - The mechanisms required under this subsection shall ensure, at a minimum, that - "(A) Department of Defense officials responsible for acquisition, budget, and cost estimating functions are provided an appropriate opportunity to develop estimates and raise cost and schedule matters before performance objectives are established for capabilities for which the Chairman of the Joint Requirements Oversight Council is the validation authority; and "(B) the process for developing requirements is structured to enable incremental, evolutionary, or spiral acquisition approaches, including the deferral of technologies that are not yet mature and capabilities that are likely to significantly increase costs or delay production until later increments or spirals." AWARDS FOR DEPARTMENT OF DEFENSE PERSONNEL FOR EXCELLENCE IN THE ACQUISITION OF PRODUCTS AND SERVICES Pub. L. 111-23, title III, Sec. 301, May 22, 2009, 123 Stat. 1730, provided that: "(a) In General. - Not later than 180 days after the date of the enactment of this Act [May 22, 2009], the Secretary of Defense shall commence carrying out a program to recognize excellent performance by individuals and teams of members of the Armed Forces and civilian personnel of the Department of Defense in the acquisition of products and services for the Department of Defense. "(b) Elements. - The program required by subsection (a) shall include the following: "(1) Procedures for the nomination by the personnel of the military departments and the Defense Agencies of individuals and teams of members of the Armed Forces and civilian personnel of the Department of Defense for eligibility for recognition under the program. "(2) Procedures for the evaluation of nominations for recognition under the program by one or more panels of individuals from the Government, academia, and the private sector who have such expertise, and are appointed in such manner, as the Secretary shall establish for purposes of the program. "(c) Award of Cash Bonuses. - As part of the program required by subsection (a), the Secretary may award to any individual recognized pursuant to the program a cash bonus authorized by any other provision of law to the extent that the performance of such individual so recognized warrants the award of such bonus under such provision of law." TRUSTED DEFENSE SYSTEMS Pub. L. 110-417, [div. A], title II, Sec. 254, Oct. 14, 2008, 122 Stat. 4402, provided that: "(a) Vulnerability Assessment Required. - The Secretary of Defense shall conduct an assessment of selected covered acquisition programs to identify vulnerabilities in the supply chain of each program's electronics and information processing systems that potentially compromise the level of trust in the systems. Such assessment shall - "(1) identify vulnerabilities at multiple levels of the electronics and information processing systems of the selected programs, including microcircuits, software, and firmware; "(2) prioritize the potential vulnerabilities and effects of the various elements and stages of the system supply chain to identify the most effective balance of investments to minimize the effects of compromise; "(3) provide recommendations regarding ways of managing supply chain risk for covered acquisition programs; and "(4) identify the appropriate lead person, and supporting elements, within the Department of Defense for the development of an integrated strategy for managing risk in the supply chain for covered acquisition programs. "(b) Assessment of Methods for Verifying the Trust of Semiconductors Procured From Commercial Sources. - The Under Secretary of Defense for Acquisition, Technology, and Logistics, in consultation with appropriate elements of the Department of Defense, the intelligence community, private industry, and academia, shall conduct an assessment of various methods of verifying the trust of semiconductors procured by the Department of Defense from commercial sources for use in mission-critical components of potentially vulnerable defense systems. The assessment shall include the following: "(1) An identification of various methods of verifying the trust of semiconductors, including methods under development at the Defense Agencies, government laboratories, institutions of higher education, and in the private sector. "(2) A determination of the methods identified under paragraph (1) that are most suitable for the Department of Defense. "(3) An assessment of the additional research and technology development needed to develop methods of verifying the trust of semiconductors that meet the needs of the Department of Defense. "(4) Any other matters that the Under Secretary considers appropriate. "(c) Strategy Required. - "(1) In general. - The lead person identified under subsection (a)(4), in cooperation with the supporting elements also identified under such subsection, shall develop an integrated strategy - "(A) for managing risk - "(i) in the supply chain of electronics and information processing systems for covered acquisition programs; and "(ii) in the procurement of semiconductors; and "(B) that ensures dependable, continuous, long-term access and trust for all mission-critical semiconductors procured from both foreign and domestic sources. "(2) Requirements. - At a minimum, the strategy shall - "(A) address the vulnerabilities identified by the assessment under subsection (a); "(B) reflect the priorities identified by such assessment; "(C) provide guidance for the planning, programming, budgeting, and execution process in order to ensure that covered acquisition programs have the necessary resources to implement all appropriate elements of the strategy; "(D) promote the use of verification tools, as appropriate, for ensuring trust of commercially acquired systems; "(E) increase use of trusted foundry services, as appropriate; and "(F) ensure sufficient oversight in implementation of the plan. "(d) Policies and Actions for Assuring Trust in Integrated Circuits. - Not later than 180 days after the date of the enactment of this Act [Oct. 14, 2008], the Secretary of Defense shall - "(1) develop policy requiring that trust assurance be a high priority for covered acquisition programs in all phases of the electronic component supply chain and integrated circuit development and production process, including design and design tools, fabrication of the semiconductors, packaging, final assembly, and test; "(2) develop policy requiring that programs whose electronics and information systems are determined to be vital to operational readiness or mission effectiveness are to employ trusted foundry services to fabricate their custom designed integrated circuits, unless the Secretary specifically authorizes otherwise; "(3) incorporate the strategies and policies of the Department of Defense regarding development and use of trusted integrated circuits into all relevant Department directives and instructions related to the acquisition of integrated circuits and programs that use such circuits; and "(4) take actions to promote the use and development of tools that verify the trust in all phases of the integrated circuit development and production process of mission-critical parts acquired from non-trusted sources. "(e) Submission to Congress. - Not later than 12 months after the date of the enactment of this Act [Oct. 14, 2008], the Secretary of Defense shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] - "(1) the assessments required by subsections (a) and (b); "(2) the strategy required by subsection (c); and "(3) a description of the policies developed and actions taken under subsection (d). "(f) Definitions. - In this section: "(1) The term 'covered acquisition programs' means an acquisition program of the Department of Defense that is a major system for purposes of section 2302(5) of title 10, United States Code. "(2) The terms 'trust' and 'trusted' refer, with respect to electronic and information processing systems, to the ability of the Department of Defense to have confidence that the systems function as intended and are free of exploitable vulnerabilities, either intentionally or unintentionally designed or inserted as part of the system at any time during its life cycle. "(3) The term 'trusted foundry services' means the program of the National Security Agency and the Department of Defense, or any similar program approved by the Secretary of Defense, for the development and manufacture of integrated circuits for critical defense systems in secure industrial environments." INCREASE OF DOMESTIC BREEDING OF MILITARY WORKING DOGS USED BY THE DEPARTMENT OF DEFENSE Pub. L. 110-417, [div. A], title III, Sec. 358, Oct. 14, 2008, 122 Stat. 4427, as amended by Pub. L. 111-84, div. A, title III, Sec. 341, Oct. 28, 2009, 123 Stat. 2260; Pub. L. 111-383, div. A, title X, Sec. 1075(e)(6), Jan. 7, 2011, 124 Stat. 4374; Pub. L. 112- 81, div. A, title III, Sec. 349, Dec. 31, 2011, 125 Stat. 1375, provided that: "(a) Increased Capacity. - The Secretary of Defense, acting through the Executive Agent for Military Working Dogs (hereinafter in this section referred to as the 'Executive Agent'), shall - "(1) identify the number of military working dogs required to fulfill the various missions of the Department of Defense for which such dogs are used, including force protection, facility and check point security, and explosives and drug detection; "(2) take such steps as are practicable to ensure an adequate number of military working dog teams are available to meet and sustain the mission requirements identified in paragraph (1); "(3) ensure that the Department's needs and performance standards with respect to military working dogs are readily available to dog breeders and trainers; and "(4) coordinate with other Federal, State, or local agencies, nonprofit organizations, universities, or private sector entities, as appropriate, to increase the training capacity for military working dog teams. "(b) Military Working Dog Procurement. - The Secretary, acting through the Executive Agent, shall work to ensure that military working dogs are procured as efficiently as possible and at the best value to the Government, while maintaining the necessary level of quality and encouraging increased domestic breeding. "(c) Biennial Report. - Not later than 90 days after the date of the enactment of the National Defense Authorization Act for Fiscal Year 2010 [Oct. 28, 2009], and biennially thereafter, the Secretary, acting through the Executive Agent, shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report on the procurement of military working dogs for the two fiscal years preceding the fiscal year during which the report is submitted. Each report under this subsection shall include the following for the period covered by the report: "(1) The number of military working dogs procured, by source, by each military department or Defense Agency. "(2) The cost of procuring military working dogs incurred by each military department or Defense Agency. "(3) An explanation for any significant difference in the cost of procuring military working dogs from different sources. "(d) Military Working Dog Defined. - For purposes of this section, the term 'military working dog' means a dog used in any official military capacity, as defined by the Secretary of Defense." COMPREHENSIVE AUDIT OF SPARE PARTS PURCHASES AND DEPOT OVERHAUL AND MAINTENANCE OF EQUIPMENT FOR OPERATIONS IN IRAQ AND AFGHANISTAN Pub. L. 110-417, [div. A], title VIII, Sec. 852, Oct. 14, 2008, 122 Stat. 4543, provided that: "(a) Audits Required. - The Army Audit Agency, the Navy Audit Service, and the Air Force Audit Agency shall each conduct thorough audits to identify potential waste, fraud, and abuse in the performance of the following: "(1) Department of Defense contracts, subcontracts, and task and delivery orders for - "(A) depot overhaul and maintenance of equipment for the military in Iraq and Afghanistan; and "(B) spare parts for military equipment used in Iraq and Afghanistan; and "(2) Department of Defense in-house overhaul and maintenance of military equipment used in Iraq and Afghanistan. "(b) Comprehensive Audit Plan. - "(1) Plans. - The Army Audit Agency, the Navy Audit Service, and the Air Force Audit Agency shall, in coordination with the Inspector General of the Department of Defense, develop a comprehensive plan for a series of audits to discharge the requirements of subsection (a). "(2) Incorporation into required audit plan. - The plan developed under paragraph (1) shall be submitted to the Inspector General of the Department of Defense for incorporation into the audit plan required by section 842(b)(1) of the National Defense Authorization Act for Fiscal Year 2008 (Public Law 110-181; 122 Stat. 234; 10 U.S.C. 2302 note). "(c) Independent Conduct of Audit Functions. - All audit functions performed under this section, including audit planning and coordination, shall be performed in an independent manner. "(d) Availability of Results. - All audit reports resulting from audits under this section shall be made available to the Commission on Wartime Contracting in Iraq and Afghanistan established pursuant to section 841 of the National Defense Authorization Act for Fiscal Year 2008 [Pub. L. 110-181] (122 Stat. 230). "(e) Construction. - Nothing in this section shall be construed to require any agency of the Federal Government to duplicate audit work that an agency of the Federal Government has already performed." MOTOR CARRIER FUEL SURCHARGES Pub. L. 110-417, [div. A], title VIII, Sec. 884, Oct. 14, 2008, 122 Stat. 4560, provided that: "(a) Pass Through to Cost Bearer. - The Secretary of Defense shall take appropriate actions to ensure that, to the maximum extent practicable, in all carriage contracts in which a fuel- related adjustment is provided for, any fuel-related adjustment is passed through to the person who bears the cost of the fuel that the adjustment relates to. "(b) Use of Contract Clause. - The actions taken by the Secretary under subsection (a) shall include the insertion of a contract clause, with appropriate flow-down requirements, into all contracts with motor carriers, brokers, or freight forwarders providing or arranging truck transportation or services in which a fuel-related adjustment is provided for. "(c) Disclosure. - The Secretary shall publicly disclose any decision by the Department of Defense to pay fuel-related adjustments under contracts (or a category of contracts) covered by this section. "(d) Report. - Not later than 270 days after the date of the enactment of this Act [Oct. 14, 2008], the Secretary shall submit to the committees on Armed Services of the Senate and the House of Representatives a report on the actions taken in accordance with the requirements of subsection (a)." SALES OF COMMERCIAL ITEMS TO NONGOVERNMENTAL ENTITIES Pub. L. 110-181, div. A, title VIII, Sec. 815(b), Jan. 28, 2008, 122 Stat. 223, provided that: "Not later than 180 days after the date of the enactment of this Act [Jan. 28, 2008], the Secretary of Defense shall modify the regulations of the Department of Defense on the procurement of commercial items in order to clarify that the terms 'general public' and 'nongovernmental entities' in such regulations do not include the Federal Government or a State, local, or foreign government." INVESTIGATION OF WASTE, FRAUD, AND ABUSE IN WARTIME CONTRACTS AND CONTRACTING PROCESSES IN IRAQ AND AFGHANISTAN Pub. L. 110-181, div. A, title VIII, Sec. 842, Jan. 28, 2008, 122 Stat. 234, provided that: "(a) Audits Required. - Thorough audits shall be performed in accordance with this section to identify potential waste, fraud, and abuse in the performance of - "(1) Department of Defense contracts, subcontracts, and task and delivery orders for the logistical support of coalition forces in Iraq and Afghanistan; and "(2) Federal agency contracts, subcontracts, and task and delivery orders for the performance of security and reconstruction functions in Iraq and Afghanistan. "(b) Audit Plans. - "(1) The Department of Defense Inspector General shall develop a comprehensive plan for a series of audits of contracts, subcontracts, and task and delivery orders covered by subsection (a)(1), consistent with the requirements of subsection (g), in consultation with other Inspectors General specified in subsection (c) with regard to any contracts, subcontracts, or task or delivery orders over which such Inspectors General have jurisdiction. "(2) The Special Inspector General for Iraq Reconstruction shall develop a comprehensive plan for a series of audits of contracts, subcontracts, and task and delivery orders covered by subsection (a)(2) relating to Iraq, consistent with the requirements of subsection (h), in consultation with other Inspectors General specified in subsection (c) with regard to any contracts, subcontracts, or task or delivery orders over which such Inspectors General have jurisdiction. "(3) The Special Inspector General for Afghanistan Reconstruction shall develop a comprehensive plan for a series of audits of contracts, subcontracts, and task and delivery orders covered by subsection (a)(2) relating to Afghanistan, consistent with the requirements of subsection (h), in consultation with other Inspectors General specified in subsection (c) with regard to any contracts, subcontracts, or task or delivery orders over which such Inspectors General have jurisdiction. "(c) Performance of Audits by Certain Inspectors General. - The Special Inspector General for Iraq Reconstruction, during such period as such office exists, the Special Inspector General for Afghanistan Reconstruction, during such period as such office exists, the Inspector General of the Department of Defense, the Inspector General of the Department of State, and the Inspector General of the United States Agency for International Development shall perform such audits as required by subsection (a) and identified in the audit plans developed pursuant to subsection (b) as fall within the respective scope of their duties as specified in law. "(d) Coordination of Audits. - The Inspectors General specified in subsection (c) shall work to coordinate the performance of the audits required by subsection (a) and identified in the audit plans developed under subsection (b) including through councils and working groups composed of such Inspectors General. "(e) Joint Audits. - If one or more audits required by subsection (a) and identified in an audit plan developed under subsection (b) falls within the scope of the duties of more than one of the Inspectors General specified in subsection (c), and such Inspectors General agree that such audit or audits are best pursued jointly, such Inspectors General shall enter into a memorandum of understanding relating to the performance of such audit or audits. "(f) Separate Audits. - If one or more audits required by subsection (a) and identified in an audit plan developed under subsection (b) falls within the scope of the duties of more than one of the Inspectors General specified in subsection (c), and such Inspectors General do not agree that such audit or audits are best pursued jointly, such audit or audits shall be separately performed by one or more of the Inspectors General concerned. "(g) Scope of Audits of Contracts. - Audits conducted pursuant to subsection (a)(1) shall examine, at a minimum, one or more of the following issues: "(1) The manner in which contract requirements were developed. "(2) The procedures under which contracts or task or delivery orders were awarded. "(3) The terms and conditions of contracts or task or delivery orders. "(4) The staffing and method of performance of contractors, including cost controls. "(5) The efficacy of Department of Defense management and oversight, including the adequacy of staffing and training of officials responsible for such management and oversight. "(6) The flow of information from contractors to officials responsible for contract management and oversight. "(h) Scope of Audits of Other Contracts. - Audits conducted pursuant to subsection (a)(2) shall examine, at a minimum, one or more of the following issues: "(1) The manner in which contract requirements were developed and contracts or task and delivery orders were awarded. "(2) The manner in which the Federal agency exercised control over the performance of contractors. "(3) The extent to which operational field commanders were able to coordinate or direct the performance of contractors in an area of combat operations. "(4) The degree to which contractor employees were properly screened, selected, trained, and equipped for the functions to be performed. "(5) The nature and extent of any incidents of misconduct or unlawful activity by contractor employees. "(6) The nature and extent of any activity by contractor employees that was inconsistent with the objectives of operational field commanders. "(7) The extent to which any incidents of misconduct or unlawful activity were reported, documented, investigated, and (where appropriate) prosecuted. "(i) Independent Conduct of Audit Functions. - All audit functions under this section, including audit planning and coordination, shall be performed by the relevant Inspectors General in an independent manner, without consultation with the Commission established pursuant to section 841 of this Act [122 Stat. 230]. All audit reports resulting from such audits shall be available to the Commission." CONTRACTS IN IRAQ AND AFGHANISTAN AND PRIVATE SECURITY CONTRACTS IN AREAS OF OTHER SIGNIFICANT MILITARY OPERATIONS Pub. L. 111-383, div. A, title VIII, Sec. 831(b), Jan. 7, 2011, 124 Stat. 4274, provided that: "(1) Deadline for regulations. - Not later than 60 days after the date of the enactment of this Act [Jan. 7, 2011], the Secretary of Defense shall revise the regulations prescribed pursuant to section 862 of the National Defense Authorization Act for Fiscal Year 2008 (Public Law 110-181; 10 U.S.C. 2302 note) to incorporate the requirements of the amendments made by subsection (a). "(2) Commencement of applicability of revisions. - The revision of regulations under paragraph (1) shall apply to the following: "(A) Any contract that is awarded on or after the date that is 120 days after the date of the enactment of this Act. "(B) Any task or delivery order that is issued on or after the date that is 120 days after the date of the enactment of this Act pursuant to a contract that is awarded before, on, or after the date that is 120 days after the date of the enactment of this Act. "(3) Commencement of inclusion of contract clause. - A contract clause that reflects the revision of regulations required by the amendments made by subsection (a) shall be inserted, as required by such section 862, into the following: "(A) Any contract described in paragraph (2)(A). "(B) Any task or delivery order described in paragraph (2)(B)." Pub. L. 111-383, div. A, title VIII, Sec. 832(b), Jan. 7, 2011, 124 Stat. 4275, provided that: "(1) Determination required for certain areas. - Not later than 150 days after the date of the enactment of this Act [Jan. 7, 2011], the Secretary of Defense shall make a written determination for each of the following areas regarding whether or not the area constitutes an area of combat operations or an area of other significant military operations for purposes of designation as such an area under section 862 of the National Defense Authorization Act for Fiscal Year 2008 (Public Law 110-181; 10 U.S.C. 2302 note), as amended by this section: "(A) The Horn of Africa region. "(B) Yemen. "(C) The Philippines. "(2) Submission to congress. - Not later than 180 days after the date of the enactment of this Act, the Secretary of Defense shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a copy of each written determination under paragraph (1), together with an explanation of the basis for such determination." Pub. L. 110-417, [div. A], title VIII, Sec. 854(b), Oct. 14, 2008, 122 Stat. 4545, provided that: "(1) Through memorandum of understanding. - The memorandum of understanding required by section 861(a) of the National Defense Authorization Act for Fiscal Year 2008 (Public Law 110-181; 122 Stat. 253; 10 U.S.C. 2302 note) shall be modified to address the requirements under the amendment made by subsection (a) [amending Pub. L. 110-181, Sec. 861(b), set out below] not later than 120 days after the date of the enactment of this Act [Oct. 14, 2008]. "(2) As condition of current and future contracts. - The requirements under the amendment made by subsection (a) shall be included in each contract in Iraq or Afghanistan (as defined in section 864(a)(2) of Public Law 110-181; [10 U.S.C.] 2302 note) awarded on or after the date that is 180 days after the date of the enactment of this Act [Oct. 14, 2008]. Federal agencies shall make best efforts to provide for the inclusion of such requirements in covered contracts awarded before such date." Pub. L. 110-417, [div. A], title VIII, Sec. 854(c), Oct. 14, 2008, 122 Stat. 4545, provided that: "Beginning not later than 270 days after the date of the enactment of this Act [Oct. 14, 2008], the Secretary of Defense shall make publicly available a numerical accounting of alleged offenses described in section 861(b)(6) of Public Law 110-181 [set out below] that have been reported under that section that occurred after the date of the enactment of this Act. The information shall be updated no less frequently than semi- annually." Pub. L. 110-181, div. A, title VIII, subtitle F, Jan. 28, 2008, 122 Stat. 253, as amended by Pub. L. 110-417, [div. A], title VIII, Secs. 853, 854(a), (d), Oct. 14, 2008, 122 Stat. 4544, 4545; Pub. L. 111-84, div. A, title VIII, Sec. 813(a)-(c), Oct. 28, 2009, 123 Stat. 2406, 2407; Pub. L. 111-383, div. A, title VIII, Secs. 831(a), 832(a), (c), 835, title X, Sec. 1075(d)(9), Jan. 7, 2011, 124 Stat. 4273, 4275, 4276, 4279, 4373; Pub. L. 112-81, div. A, title VIII, Sec. 844(c), Dec. 31, 2011, 125 Stat. 1515, provided that: "SEC. 861. MEMORANDUM OF UNDERSTANDING ON MATTERS RELATING TO CONTRACTING. "(a) Memorandum of Understanding Required. - The Secretary of Defense, the Secretary of State, and the Administrator of the United States Agency for International Development shall, not later than July 1, 2008, enter into a memorandum of understanding regarding matters relating to contracting for contracts in Iraq or Afghanistan. "(b) Matters Covered. - The memorandum of understanding required by subsection (a) shall address, at a minimum, the following: "(1) Identification of the major categories of contracts in Iraq or Afghanistan being awarded by the Department of Defense, the Department of State, or the United States Agency for International Development. "(2) Identification of the roles and responsibilities of each department or agency for matters relating to contracting for contracts in Iraq or Afghanistan. "(3) Responsibility for establishing procedures for, and the coordination of, movement of contractor personnel in Iraq or Afghanistan. "(4) Identification of common databases that will serve as repositories of information on contracts in Iraq or Afghanistan and contractor personnel in Iraq or Afghanistan, including agreement on the elements to be included in the databases, including, at a minimum - "(A) with respect to each contract - "(i) a brief description of the contract (to the extent consistent with security considerations); "(ii) the total value of the contract; and "(iii) whether the contract was awarded competitively; and "(B) with respect to contractor personnel - "(i) the total number of personnel employed on contracts in Iraq or Afghanistan; "(ii) the total number of personnel performing security functions under contracts in Iraq or Afghanistan; and "(iii) the total number of personnel working under contracts in Iraq or Afghanistan who have been killed or wounded. "(5) Responsibility for maintaining and updating information in the common databases identified under paragraph (4). "(6) Responsibility for the collection and referral to the appropriate Government agency of any information relating to offenses under chapter 47 of title 10, United States Code (the Uniform Code of Military Justice) or chapter 212 of title 18, United States Code (commonly referred to as the Military Extraterritorial Jurisdiction Act), including a clarification of responsibilities under section 802(a)(10) of title 10, United States Code (article 2(a) of the Uniform Code of Military Justice), as amended by section 552 of the John Warner National Defense Authorization Act for Fiscal Year 2007 (Public Law 109- 364). "(7) Mechanisms for ensuring that contractors are required to report offenses described in paragraph (6) that are alleged to have been committed by or against contractor personnel to appropriate investigative authorities. "(8) Responsibility for providing victim and witness protection and assistance to contractor personnel in connection with alleged offenses described in paragraph (6). "(9) Development of a requirement that a contractor shall provide to all contractor personnel who will perform work on a contract in Iraq or Afghanistan, before beginning such work, information on the following: "(A) How and where to report an alleged offense described in paragraph (6). "(B) Where to seek the assistance required by paragraph (8). "(c) Implementation of Memorandum of Understanding. - Not later than 120 days after the memorandum of understanding required by subsection (a) is signed, the Secretary of Defense, the Secretary of State, and the Administrator of the United States Agency for International Development shall issue such policies or guidance and prescribe such regulations as are necessary to implement the memorandum of understanding for the relevant matters pertaining to their respective agencies. "(d) Copies Provided to Congress. - "(1) Memorandum of understanding. - Copies of the memorandum of understanding required by subsection (a) shall be provided to the relevant committees of Congress within 30 days after the memorandum is signed. "(2) Report on implementation. - Not later than 180 days after the memorandum of understanding required by subsection (a) is signed, the Secretary of Defense, the Secretary of State, and the Administrator of the United States Agency for International Development shall each provide a report to the relevant committees of Congress on the implementation of the memorandum of understanding. "(3) Databases. - The Secretary of Defense, the Secretary of State, or the Administrator of the United States Agency for International Development shall provide access to the common databases identified under subsection (b)(4) to the relevant committees of Congress. "(4) Contracts. - Effective on the date of the enactment of this Act [Jan. 28, 2008], copies of any contracts in Iraq or Afghanistan awarded after December 1, 2007, shall be provided to any of the relevant committees of Congress within 15 days after the submission of a request for such contract or contracts from such committee to the department or agency managing the contract. "SEC. 862. CONTRACTORS PERFORMING PRIVATE SECURITY FUNCTIONS IN AREAS OF COMBAT OPERATIONS OR OTHER SIGNIFICANT MILITARY OPERATIONS. "(a) Regulations on Contractors Performing Private Security Functions. - "(1) In general. - Not later than 120 days after the date of the enactment of this Act [Jan. 28, 2008], the Secretary of Defense, in coordination with the Secretary of State, shall prescribe regulations on the selection, training, equipping, and conduct of personnel performing private security functions under a covered contract in an area of combat operations or other significant military operations. "(2) Elements. - The regulations prescribed under subsection (a) shall, at a minimum, establish - "(A) a process for registering, processing, accounting for, and keeping appropriate records of personnel performing private security functions in an area of combat operations or other significant military operations; "(B) a process for authorizing and accounting for weapons to be carried by, or available to be used by, personnel performing private security functions in an area of combat operations or other significant military operations; "(C) a process for the registration and identification of armored vehicles, helicopters, and other military vehicles operated by contractors performing private security functions in an area of combat operations or other significant military operations; "(D) a process under which contractors are required to report all incidents, and persons other than contractors are permitted to report incidents, in which - "(i) a weapon is discharged by personnel performing private security functions in an area of combat operations or other significant military operations; "(ii) personnel performing private security functions in an area of combat operations or other significant military operations are killed or injured; "(iii) persons are killed or injured, or property is destroyed, as a result of conduct by contractor personnel; "(iv) a weapon is discharged against personnel performing private security functions in an area of combat operations or other significant military operations or personnel performing such functions believe a weapon was so discharged; or "(v) active, non-lethal countermeasures (other than the discharge of a weapon) are employed by the personnel performing private security functions in an area of combat operations or other significant military operations in response to a perceived immediate threat to such personnel; "(E) a process for the independent review and, if practicable, investigation of - "(i) incidents reported pursuant to subparagraph (D); and "(ii) incidents of alleged misconduct by personnel performing private security functions in an area of combat operations or other significant military operations; "(F) requirements for qualification, training, screening (including, if practicable, through background checks), and security for personnel performing private security functions in an area of combat operations or other significant military operations; "(G) guidance to the commanders of the combatant commands on the issuance of - "(i) orders, directives, and instructions to contractors performing private security functions relating to equipment, force protection, security, health, safety, or relations and interaction with locals; "(ii) predeployment training requirements for personnel performing private security functions in an area of combat operations or other significant military operations, addressing the requirements of this section, resources and assistance available to contractor personnel, country information and cultural training, and guidance on working with host country nationals and military; and "(iii) rules on the use of force for personnel performing private security functions in an area of combat operations or other significant military operations; "(H) a process by which a commander of a combatant command may request an action described in subsection (b)(3); and "(I) a process by which the training requirements referred to in subparagraph (G)(ii) shall be implemented. "(3) Availability of orders, directives, and instructions. - The regulations prescribed under subsection (a) shall include mechanisms to ensure the provision and availability of the orders, directives, and instructions referred to in paragraph (2)(G)(i) to contractors referred to in that paragraph, including through the maintenance of a single location (including an Internet website, to the extent consistent with security considerations) at or through which such contractors may access such orders, directives, and instructions. "(b) Contract Clause on Contractors Performing Private Security Functions. - "(1) Requirement under far. - Not later than 180 days after the date of the enactment of this Act [Jan. 28, 2008], the Federal Acquisition Regulation issued in accordance with section 25 of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 421) [see 41 U.S.C. 1303] shall be revised to require the insertion into each covered contract (or, in the case of a task order, the contract under which the task order is issued) of a contract clause addressing the selection, training, equipping, and conduct of personnel performing private security functions under such contract. "(2) Clause requirement. - The contract clause required by paragraph (1) shall require, at a minimum, that the contractor concerned shall - "(A) ensure that the contractor and all employees of the contractor or any subcontractor who are responsible for performing private security functions under such contract comply with regulations prescribed under subsection (a), including any revisions or updates to such regulations, and follow the procedures established in such regulations for - "(i) registering, processing, accounting for, and keeping appropriate records of personnel performing private security functions in an area of combat operations or other significant military operations; "(ii) authorizing and accounting of weapons to be carried by, or available to be used by, personnel performing private security functions in an area of combat operations or other significant military operations; "(iii) registration and identification of armored vehicles, helicopters, and other military vehicles operated by contractors and subcontractors performing private security functions in an area of combat operations or other significant military operations; and "(iv) the reporting of incidents in which - "(I) a weapon is discharged by personnel performing private security functions in an area of combat operations or other significant military operations; "(II) personnel performing private security functions in an area of combat operations or other significant military operations are killed or injured; or "(III) persons are killed or injured, or property is destroyed, as a result of conduct by contractor personnel; "(B) ensure that the contractor and all employees of the contractor or any subcontractor who are responsible for performing private security functions under such contract comply with - "(i) qualification, training, screening (including, if practicable, through background checks), and security requirements established by the Secretary of Defense for personnel performing private security functions in an area of combat operations or other significant military operations; "(ii) applicable laws and regulations of the United States and the host country, and applicable treaties and international agreements, regarding the performance of the functions of the contractor; "(iii) orders, directives, and instructions issued by the applicable commander of a combatant command relating to equipment, force protection, security, health, safety, or relations and interaction with locals; and "(iv) rules on the use of force issued by the applicable commander of a combatant command for personnel performing private security functions in an area of combat operations or other significant military operations; "(C) cooperate with any investigation conducted by the Department of Defense pursuant to subsection (a)(2)(E) by providing access to employees of the contractor and relevant information in the possession of the contractor regarding the incident concerned; and "(D) ensure that the contract clause is included in subcontracts awarded to any subcontractor at any tier who is responsible for performing private security functions under the contract. "(3) Noncompliance of personnel with clause. - The contracting officer for a covered contract may direct the contractor, at its own expense, to remove or replace any personnel performing private security functions in an area of combat operations or other significant military operations who violate or fail to comply with applicable requirements of the clause required by this subsection. If the violation or failure to comply is a gross violation or failure or is repeated, the contract may be terminated for default. "(4) Applicability. - The contract clause required by this subsection shall be included in all covered contracts awarded on or after the date that is 180 days after the date of the enactment of this Act [Jan. 28, 2008]. Federal agencies shall make best efforts to provide for the inclusion of the contract clause required by this subsection in covered contracts awarded before such date. "(5) Inspector general report on pilot program on imposition of fines for noncompliance of personnel with clause. - Not later than March 30, 2008, the Inspector General of the Department of Defense shall submit to Congress a report assessing the feasibility and advisability of carrying out a pilot program for the imposition of fines on contractors for personnel who violate or fail to comply with applicable requirements of the clause required by this section as a mechanism for enhancing the compliance of such personnel with the clause. The report shall include - "(A) an assessment of the feasibility and advisability of carrying out the pilot program; and "(B) if the Inspector General determines that carrying out the pilot program is feasible and advisable - "(i) recommendations on the range of contracts and subcontracts to which the pilot program should apply; and "(ii) a schedule of fines to be imposed under the pilot program for various types of personnel actions or failures. "(c) Oversight. - It shall be the responsibility of the head of the contracting activity responsible for each covered contract to ensure that the contracting activity takes appropriate steps to assign sufficient oversight personnel to the contract to - "(1) ensure that the contractor responsible for performing private security functions under such contract comply with the regulatory requirements prescribed pursuant to subsection (a) and the contract requirements established pursuant to subsection (b); and "(2) make the determinations required by subsection (d). "(d) Remedies. - The failure of a contractor under a covered contract to comply with the requirements of the regulations prescribed under subsection (a) or the contract clause inserted in a covered contract pursuant to subsection (b), as determined by the contracting officer for the covered contract - "(1) shall be included in appropriate databases of past performance and considered in any responsibility determination or evaluation of the past performance of the contractor for the purpose of a contract award decision, as provided in section 6(j) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 405(j) [now 41 U.S.C. 1126]); "(2) in the case of an award fee contract - "(A) shall be considered in any evaluation of contract performance by the contractor for the relevant award fee period; and "(B) may be a basis for reducing or denying award fees for such period, or for recovering all or part of award fees previously paid for such period; and "(3) in the case of a failure to comply that is severe, prolonged, or repeated - "(A) shall be referred to the suspension or debarment official for the appropriate agency; and "(B) may be a basis for suspension or debarment of the contractor. "(e) Rule of Construction. - The duty of a contractor under a covered contract to comply with the requirements of the regulations prescribed under subsection (a) and the contract clause inserted into a covered contract pursuant to subsection (b), and the availability of the remedies provided in subsection (d), shall not be reduced or diminished by the failure of a higher or lower tier contractor under such contract to comply with such requirements, or by a failure of the contracting activity to provide the oversight required by subsection (c). "(f) Areas of Combat Operations or Other Significant Military Operations. - "(1) Designation. - The Secretary of Defense shall designate the areas constituting either an area of combat operations or other significant military operations for purposes of this section by not later than 120 days after the date of the enactment of this Act [Jan. 28, 2008]. In making designations under this paragraph, the Secretary shall ensure that an area is not designated in whole or part as both an area of combat operations and an area of other significant military operations. "(2) Other significant military operations. - For purposes of this section, the term 'other significant military operations' means activities, other than combat operations, as part of an overseas contingency operation that are carried out by United States Armed Forces in an uncontrolled or unpredictable high- threat environment where personnel performing security functions may be called upon to use deadly force. "(3) Particular areas. - Iraq and Afghanistan shall be included in the areas designated as an area of combat operations or other significant military operations under paragraph (1). "(4) Additional areas. - The Secretary may designate any additional area as an area constituting an area of combat operations or other significant military operations for purposes of this section if the Secretary determines that the presence or potential of combat operations or other significant military operations in such area warrants designation of such area as an area of combat operations or other significant military operations for purposes of this section. "(5) Modification or elimination of designation. - The Secretary may modify or cease the designation of an area under this subsection as an area of combat operations or other significant military operations if the Secretary determines that combat operations or other significant military operations are no longer ongoing in such area. "(g) Limitation. - With respect to an area of other significant military operations, the requirements of this section shall apply only upon agreement of the Secretary of Defense and the Secretary of State. An agreement of the Secretaries under this subsection may be made only on an area-by-area basis. With respect to an area of combat operations, the requirements of this section shall always apply. "(h) Exceptions. - "(1) Intelligence activities. - The requirements of this section shall not apply to contracts entered into by elements of the intelligence community in support of intelligence activities. "(2) Nongovernmental organizations. - The requirements of this section shall not apply to a nonprofit nongovernmental organization receiving grants or cooperative agreements for activities conducted within an area of other significant military operations if the Secretary of Defense and the Secretary of State agree that such organization may be exempted. An exemption may be granted by the agreement of the Secretaries under this paragraph on an organization-by-organization or area-by-area basis. Such an exemption may not be granted with respect to an area of combat operations. "SEC. 863. ANNUAL JOINT REPORT AND COMPTROLLER GENERAL REVIEW ON CONTRACTING IN IRAQ AND AFGHANISTAN. "(a) Joint Report Required. - "(1) In general. - Except as provided in paragraph (6), every 12 months, the Secretary of Defense, the Secretary of State, and the Administrator of the United States Agency for International Development shall submit to the relevant committees of Congress a joint report on contracts in Iraq or Afghanistan. "(2) Primary matters covered. - A report under this subsection shall, at a minimum, cover the following with respect to contracts in Iraq and Afghanistan during the reporting period: "(A) Total number of contracts awarded. "(B) Total number of active contracts. "(C) Total value of all contracts awarded. "(D) Total value of active contracts. "(E) The extent to which such contracts have used competitive procedures. "(F) Percentage of contracts awarded on a competitive basis as compared to established goals for competition in contingency contracting actions. "(G) Total number of contractor personnel working on contracts at the end of each quarter of the reporting period. "(H) Total number of contractor personnel who are performing security functions at the end of each quarter of the reporting period. "(I) Total number of contractor personnel killed or wounded. "(3) Additional matters covered. - A report under this subsection shall also cover the following: "(A) The sources of information and data used to compile the information required under paragraph (2). "(B) A description of any known limitations of the data reported under paragraph (2), including known limitations of the methodology and data sources used to compile the report. "(C) Any plans for strengthening collection, coordination, and sharing of information on contracts in Iraq and Afghanistan through improvements to the common databases identified under section 861(b)(4). "(4) Reporting period. - A report under this subsection shall cover a period of not less than 12 months. "(5) Submission of reports. - The Secretaries and the Administrator shall submit an initial report under this subsection not later than February 1, 2011, and shall submit an updated report by February 1 of every year thereafter until February 1, 2013. "(6) Exception. - If the total annual amount of obligations for contracts in Iraq and Afghanistan combined is less than $250,000,000 for the reporting period, for all three agencies combined, the Secretaries and the Administrator may submit, in lieu of a report, a letter stating the applicability of this paragraph, with such documentation as the Secretaries and the Administrator consider appropriate. "(7) Estimates. - In determining the total number of contractor personnel working on contracts under paragraph (2)(F), the Secretaries and the Administrator may use estimates for any category of contractor personnel for which they determine it is not feasible to provide an actual count. The report shall fully disclose the extent to which estimates are used in lieu of an actual count. "(b) Comptroller General Review and Report. - "(1) In general. - Within 180 days after submission of each annual joint report required under subsection (a), but in no case later than August 5 of each year until 2013, the Comptroller General of the United States shall review the joint report and submit to the relevant committees of Congress a report on such review. "(2) Matters covered. - A report under this subsection shall, at minimum - "(A) assess the data and data sources used in developing the joint report; "(B) review how the Department of Defense, the Department of State, and the United States Agency for International Development are using the data and the data sources used to develop the joint report in managing, overseeing, and coordinating contracting in Iraq and Afghanistan; "(C) assess the plans of the departments and agency for strengthening or improving the common databases identified under section 861(b)(4); and "(D) review and make recommendations on any specific contract or class of contracts that the Comptroller General determines raises issues of significant concern. "(3) Access to databases and other information. - The Secretary of Defense, the Secretary of State, and the Administrator of the United States Agency for International Development shall provide to the Comptroller General full access to information on contracts in Iraq and Afghanistan for the purposes of the review carried out under this subsection, including the common databases identified under section 861(b)(4). "SEC. 864. DEFINITIONS AND OTHER GENERAL PROVISIONS. "(a) Definitions. - In this subtitle: "(1) Matters relating to contracting. - The term 'matters relating to contracting', with respect to contracts in Iraq and Afghanistan, means all matters relating to awarding, funding, managing, tracking, monitoring, and providing oversight to contracts and contractor personnel. "(2) Contract in iraq or afghanistan. - The term 'contract in Iraq or Afghanistan' means a contract with the Department of Defense, the Department of State, or the United States Agency for International Development, a subcontract at any tier issued under such a contract, a task order or delivery order at any tier issued under such a contract, a grant, or a cooperative agreement (including a contract, subcontract, task order, delivery order, grant, or cooperative agreement issued by another Government agency for the Department of Defense, the Department of State, or the United States Agency for International Development), if the contract, subcontract, task order, delivery order, grant, or cooperative agreement involves worked [sic] performed in Iraq or Afghanistan for a period longer than 30 days. "(3) Covered contract. - The term 'covered contract' means - "(A) a contract of a Federal agency for the performance of services in an area of combat operations, as designated by the Secretary of Defense under subsection (c) of section 862; "(B) a subcontract at any tier under such a contract; "(C) a task order or delivery order issued under such a contract or subcontract; "(D) a grant for the performance of services in an area of combat operations, as designated by the Secretary of Defense under subsection (c) of section 862; or "(E) a cooperative agreement for the performance of services in such an area of combat operations. "(4) Contractor. - The term 'contractor', with respect to a covered contract, means - "(A) in the case of a covered contract that is a contract, subcontract, task order, or delivery order, the contractor or subcontractor carrying out the covered contract; "(B) in the case of a covered contract that is a grant, the grantee; and "(C) in the case of a covered contract that is a cooperative agreement, the recipient. "(5) Contractor personnel. - The term 'contractor personnel' means any person performing work under contract for the Department of Defense, the Department of State, or the United States Agency for International Development, in Iraq or Afghanistan, including individuals and subcontractors at any tier. "(6) Private security functions. - The term 'private security functions' means activities engaged in by a contractor under a covered contract as follows: "(A) Guarding of personnel, facilities, or property of a Federal agency, the contractor or subcontractor, or a third party. "(B) Any other activity for which personnel are required to carry weapons in the performance of their duties. "(7) Relevant committees of congress. - The term 'relevant committees of Congress' means each of the following committees: "(A) The Committees on Armed Services of the Senate and the House of Representatives. "(B) The Committee on Homeland Security and Governmental Affairs of the Senate and the Committee on Oversight and Government Reform of the House of Representatives. "(C) The Committee on Foreign Relations of the Senate and the Committee on Foreign Affairs of the House of Representatives. "(D) For purposes of contracts relating to the National Foreign Intelligence Program, the Select Committee on Intelligence of the Senate and the Permanent Select Committee on Intelligence of the House of Representatives. "(b) Classified Information. - Nothing in this subtitle shall be interpreted to require the handling of classified information or information relating to intelligence sources and methods in a manner inconsistent with any law, regulation, executive order, or rule of the House of Representatives or of the Senate relating to the handling or protection of such information." ENHANCED AUTHORITY TO ACQUIRE PRODUCTS AND SERVICES PRODUCED IN IRAQ AND AFGHANISTAN Pub. L. 110-181, div. A, title VIII, Sec. 886, Jan. 28, 2008, 122 Stat. 266, provided that: "(a) In General. - In the case of a product or service to be acquired in support of military operations or stability operations in Iraq or Afghanistan (including security, transition, reconstruction, and humanitarian relief activities) for which the Secretary of Defense makes a determination described in subsection (b), the Secretary may conduct a procurement in which - "(1) competition is limited to products or services that are from Iraq or Afghanistan; "(2) procedures other than competitive procedures are used to award a contract to a particular source or sources from Iraq or Afghanistan; or "(3) a preference is provided for products or services that are from Iraq or Afghanistan. "(b) Determination. - A determination described in this subsection is a determination by the Secretary that - "(1) the product or service concerned is to be used only by the military forces, police, or other security personnel of Iraq or Afghanistan; or "(2) it is in the national security interest of the United States to limit competition, use procedures other than competitive procedures, or provide a preference as described in subsection (a) because - "(A) such limitation, procedure, or preference is necessary to provide a stable source of jobs in Iraq or Afghanistan; and "(B) such limitation, procedure, or preference will not adversely affect - "(i) military operations or stability operations in Iraq or Afghanistan; or "(ii) the United States industrial base. "(c) Products, Services, and Sources From Iraq or Afghanistan. - For the purposes of this section: "(1) A product is from Iraq or Afghanistan if it is mined, produced, or manufactured in Iraq or Afghanistan. "(2) A service is from Iraq or Afghanistan if it is performed in Iraq or Afghanistan by citizens or permanent resident aliens of Iraq or Afghanistan. "(3) A source is from Iraq or Afghanistan if it - "(A) is located in Iraq or Afghanistan; and "(B) offers products or services that are from Iraq or Afghanistan." PREVENTION OF EXPORT CONTROL VIOLATIONS Pub. L. 110-181, div. A, title VIII, Sec. 890, Jan. 28, 2008, 122 Stat. 269, as amended by Pub. L. 110-417, [div. A], title X, Sec. 1061(b)(6), Oct. 14, 2008, 122 Stat. 4613; Pub. L. 111-383, div. A, title X, Sec. 1075(f)(6), Jan. 7, 2011, 124 Stat. 4376, provided that: "(a) Prevention of Export Control Violations. - Not later than 180 days after the date of the enactment of this Act [Jan. 28, 2008], the Secretary of Defense shall prescribe regulations requiring any contractor under a contract with the Department of Defense to provide goods or technology that is subject to export controls under the Arms Export Control Act [22 U.S.C. 2751 et seq.] or the Export Administration Act of 1979 [50 U.S.C. App. 2401 et seq.] (as continued in effect under the International Emergency Economic Powers Act [50 U.S.C. 1701 et seq.]) to comply with those Acts and applicable regulations with respect to such goods and technology, including the International Traffic in Arms Regulations and the Export Administration Regulations. Regulations prescribed under this subsection shall include a contract clause enforcing such requirement. "(b) Training on Export Controls. - The Secretary of Defense shall ensure that any contractor under a contract with the Department of Defense to provide goods or technology that is subject to export controls under the Arms Export Control Act or the Export Administration Act of 1979 (as continued in effect under the International Emergency Economic Powers Act) is made aware of any relevant resources made available by the Department of State and the Department of Commerce to assist in compliance with the requirement established by subsection (a) and the need for a corporate compliance plan and periodic internal audits of corporate performance under such plan. "(c) Report. - Not later than 180 days after the date of the enactment of this Act [Jan. 28, 2008], the Secretary of Defense shall submit to the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives a report assessing the utility of - "(1) requiring defense contractors (or subcontractors at any tier) to periodically report on measures taken to ensure compliance with the International Traffic in Arms Regulations and the Export Administration Regulations; "(2) requiring periodic audits of defense contractors (or subcontractors at any tier) to ensure compliance with all provisions of the International Traffic in Arms Regulations and the Export Administration Regulations; "(3) requiring defense contractors to maintain a corporate training plan to disseminate information to appropriate contractor personnel regarding the applicability of the Arms Export Control Act and the Export Administration Act of 1979; and "(4) requiring a designated corporate liaison, available for training provided by the United States Government, whose primary responsibility would be contractor compliance with the Arms Export Control Act and the Export Administration Act of 1979. "(d) Definitions. - In this section: "(1) Export administration regulations. - The term 'Export Administration Regulations' means those regulations contained in parts 730 through 774 of title 15, Code of Federal Regulations (or successor regulations). "(2) International traffic in arms regulations. - The term 'International Traffic in Arms Regulations' means those regulations contained in parts 120 through 130 of title 22, Code of Federal Regulations (or successor regulations)." QUALITY CONTROL IN PROCUREMENT OF SHIP CRITICAL SAFETY ITEMS AND RELATED SERVICES Pub. L. 109-364, div. A, title I, Sec. 130(a)-(c), Oct. 17, 2006, 120 Stat. 2110, provided that: "(a) Quality Control Policy. - The Secretary of Defense shall prescribe in regulations a quality control policy for the procurement of the following: "(1) Ship critical safety items. "(2) Modifications, repair, and overhaul of ship critical safety items. "(b) Elements. - The policy required under subsection (a) shall include requirements as follows: "(1) That the head of the design control activity for ship critical safety items establish processes to identify and manage the procurement, modification, repair, and overhaul of such items. "(2) That the head of the contracting activity for a ship critical safety item enter into a contract for the procurement, modification, repair, or overhaul of such item only with a source on a qualified manufacturers list or a source approved by the design control activity in accordance with section 2319 of title 10, United States Code (as amended by subsection (d)). "(3) That the ship critical safety items delivered, and the services performed with respect to such items, meet all technical and quality requirements specified by the design control activity. "(c) Definitions. - In this section, the terms 'ship critical safety item' and 'design control activity' have the meanings given such terms in subsection (g) of section 2319 of title 10, United States Code (as so amended)." PILOT PROGRAM ON TIME-CERTAIN DEVELOPMENT IN ACQUISITION OF MAJOR WEAPON SYSTEMS Pub. L. 109-364, div. A, title VIII, Sec. 812, Oct. 17, 2006, 120 Stat. 2317, as amended by Pub. L. 110-417, [div. A], title VIII, Sec. 813(d)(3), Oct. 14, 2008, 122 Stat. 4527; Pub. L. 111-84, div. A, title X, Sec. 1073(c)(5), Oct. 28, 2009, 123 Stat. 2474, provided that: "(a) Pilot Program Authorized. - The Secretary of Defense may carry out a pilot program on the use of time-certain development in the acquisition of major weapon systems. "(b) Purpose of Pilot Program. - The purpose of the pilot program authorized by subsection (a) is to assess the feasibility and advisability of utilizing time-certain development in the acquisition of major weapon systems in order to deliver new capabilities to the warfighter more rapidly through - "(1) disciplined decision-making; "(2) emphasis on technological maturity; and "(3) appropriate trade-offs between - "(A) cost and system performance; and "(B) program schedule. "(c) Inclusion of Systems in Pilot Program. - "(1) In general. - The Secretary of Defense may include a major weapon system in the pilot program only if - "(A) the major weapon system meets the criteria under paragraph (2) in accordance with that paragraph; and "(B) the Milestone Decision Authority nominates such program to the Secretary of Defense for inclusion in the program. "(2) Criteria. - For purposes of paragraph (1) a major weapon system meets the criteria under this paragraph only if the Milestone Decision Authority determines, in consultation with the service acquisition executive for the military department carrying out the acquisition program for the system and one or more combatant commanders responsible for fielding the system, that - "(A) the certification requirements of section 2366b of title 10, United States Code (as amended by section 805 of this Act), have been met, and no waivers have been granted from such requirements; "(B) a preliminary design has been reviewed using systems engineering, and the system, as so designed, will meet battlefield needs identified by the relevant combatant commanders after appropriate requirements analysis; "(C) a representative model or prototype of the system, or key subsystems, has been demonstrated in a relevant environment, such as a well-simulated operational environment; "(D) an independent cost estimate has been conducted and used as the basis for funding requirements for the acquisition program for the system; "(E) the budget of the military department responsible for carrying out the acquisition program for the system provides the funding necessary to execute the product development and production plan consistent with the requirements identified pursuant to subparagraph (D); "(F) an appropriately qualified program manager has entered into a performance agreement with the Milestone Decision Authority that establishes expected parameters for the cost, schedule, and performance of the acquisition program for the system, consistent with a business case for such acquisition program; "(G) the service acquisition executive and the program manager have developed a strategy to ensure stability in program management until, at a minimum, the delivery of the initial operational capability under the acquisition program for the system has occurred; "(H) the service acquisition executive, the relevant combatant commanders, and the program manager have agreed that no additional requirements that would be inconsistent with the agreed-upon program schedule will be added during the development phase of the acquisition program for the system; and "(I) a planned initial operational capability will be delivered to the relevant combatant commanders within a defined period of time as prescribed in regulations by the Secretary of Defense. "(3) Timing of decision. - The decision whether to include a major weapon system in the pilot program shall be made at the time of milestone approval for the acquisition program for the system. "(d) Limitation on Number of Weapons Systems in Pilot Program. - The number of major weapon systems included in the pilot program at any time may not exceed six major weapon systems. "(e) Limitation on Cost of Weapons Systems in Pilot Program. - The Secretary of Defense may include a major weapon system in the pilot program only if, at the time a major weapon system is proposed for inclusion, the total cost for system design and development of the weapon system, as set forth in the cost estimate referred to in subsection (c)(2)(D), does not exceed $1,000,000,000 during the period covered by the current future-years defense program. "(f) Special Funding Authority. - "(1) Authority for reserve account. - Notwithstanding any other provision of law, the Secretary of Defense may establish a special reserve account utilizing funds made available for the major weapon systems included in the pilot program. "(2) Elements. - The special reserve account may include - "(A) funds made available for any major weapon system included in the pilot program to cover termination liability; "(B) funds made available for any major weapon system included in the pilot program for award fees that may be earned by contractors; and "(C) funds appropriated to the special reserve account. "(3) Availability of funds. - Funds in the special reserve account may be used, in accordance with guidance issued by the Secretary for purposes of this section, for the following purposes: "(A) To cover termination liability for any major weapon system included in the pilot program. "(B) To pay award fees that are earned by any contractor for a major weapon system included in the pilot program. "(C) To address unforeseen contingencies that could prevent a major weapon system included in the pilot program from meeting critical schedule or performance requirements. "(4) Reports on use of funds. - Not later than 30 days after the use of funds in the special reserve account for the purpose specified in paragraph (3)(C), the Secretary shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report on the use of funds in the account for such purpose. The report shall set forth the purposes for which the funds were used and the reasons for the use of the funds for such purposes. "(5) Relationship to appropriations. - Nothing in this subsection may be construed as extending any period of time for which appropriated funds are made available. "(g) Administration of Pilot Program. - The Secretary of Defense shall prescribe policies and procedures on the administration of the pilot program. Such policies and procedures shall - "(1) provide for the use of program status reports based on earned value data to track progress on a major weapon system under the pilot program against baseline estimates applicable to such system at each systems engineering technical review point; and "(2) grant authority, to the maximum extent practicable, to the program manager for the acquisition program for a major weapon system to make key program decisions and trade-offs, subject to management reviews only if cost or schedule deviations exceed the baselines for such acquisition program by 10 percent or more. "(h) Removal of Weapons Systems From Pilot Program. - The Secretary of Defense shall remove a major weapon system from the pilot program if - "(1) the weapon system receives Milestone C approval; or "(2) the Secretary determines that the weapon system is no longer in substantial compliance with the criteria in subsection (c)(2) or is otherwise no longer appropriate for inclusion in the pilot program. "(i) Expiration of Authority To Include Additional Systems in Pilot Program. - "(1) Expiration. - A major weapon system may not be included in the pilot program after September 30, 2012. "(2) Retention of systems. - A major weapon system included in the pilot program before the date specified in paragraph (1) in accordance with the requirements of this section may remain in the pilot program after that date. "(j) Annual Report. - "(1) In general. - Not later than one year after including the first major weapon system in the pilot program, and annually thereafter, the Secretary shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report on the pilot program, and the major weapon systems included in the pilot program, during the one-year period ending on the date of such report. "(2) Elements. - Each report under this subsection shall include - "(A) a description of progress under the pilot program, and on each major weapon system included in the pilot program, during the period covered by such report; "(B) a description of the use of all funds in the special reserve account established under subsection (f); and "(C) such other matters as the Secretary considers appropriate. "(k) Major Weapon System Defined. - In this section, the term 'major weapon system' means a weapon system that is treatable as a major system under section 2302(5) of title 10, United States Code." [Pub. L. 111-84, div. A, title X, Sec. 1073(c), Oct. 28, 2009, 123 Stat. 2474, provided that the amendment made by section 1073(c)(5) to section 813(d)(3) of Pub. L. 110-417, set out above, is effective as of Oct. 14, 2008, and as if included in Pub. L. 110- 417 as enacted.] LINKING OF AWARD AND INCENTIVE FEES TO ACQUISITION OUTCOMES Pub. L. 111-84, div. A, title VIII, Sec. 823, Oct. 28, 2009, 123 Stat. 2412, as amended by Pub. L. 111-383, div. A, title VIII, Sec. 834(a)-(c), Jan. 7, 2011, 124 Stat. 4278, 4279, provided that: "(a) Authority To Reduce or Deny Award Fees. - Not later than 180 days after the date of the enactment of this Act [Oct. 28, 2009], the Secretary of Defense shall revise the guidance issued pursuant to section 814 of the John Warner National Defense Authorization Act for Fiscal Year 2007 (Public Law 109-364; 129 [120] Stat. 2321) [set out below] to ensure that all covered contracts using award fees - "(1) provide for the consideration of any incident described in subsection (b) in evaluations of contractor performance for the relevant award fee period; and "(2) authorize the Secretary to reduce or deny award fees for the relevant award fee period, or to recover all or part of award fees previously paid for such period, on the basis of the negative impact of such incident on contractor performance. "(b) Covered Incidents. - An incident referred to in subsection (a) is any incident in which the contractor - "(1) has been determined, through a criminal, civil, or administrative proceeding that results in a disposition listed in subsection (c), in the performance of a covered contract to have caused serious bodily injury or death to any civilian or military personnel of the Government through gross negligence or with reckless disregard for the safety of such personnel; or "(2) has been determined, through a criminal, civil, or administrative proceeding that results in a disposition listed in subsection (c), to be liable for actions of a subcontractor of the contractor that caused serious bodily injury or death to any civilian or military personnel of the Government, through gross negligence or with reckless disregard for the safety of such personnel. "(c) List of Dispositions in Criminal, Civil, or Administrative Proceedings. - For purposes of subsection (b), the dispositions listed in this subsection are as follows: "(1) In a criminal proceeding, a conviction. "(2) In a civil proceeding, a finding of fault and liability that results in the payment of a monetary fine, penalty, reimbursement, restitution, or damages of $5,000 or more. "(3) In an administrative proceeding, a finding of fault and liability that results in - "(A) the payment of a monetary fine or penalty of $5,000 or more; or "(B) the payment of a reimbursement, restitution, or damages in excess of $100,000. "(4) To the maximum extent practicable and consistent with applicable laws and regulations, in a criminal, civil, or administrative proceeding, a disposition of the matter by consent or compromise with an acknowledgment of fault by the person if the proceeding could have led to any of the outcomes specified in paragraph (1), (2), or (3). "(5) In an administrative proceeding, a final determination of contractor fault by the Secretary of Defense pursuant to subsection (d). "(d) Determinations of Contractor Fault by Secretary of Defense. - "(1) In general. - In any case described by paragraph (2), the Secretary of Defense shall - "(A) provide for an expeditious independent investigation of the causes of the serious bodily injury or death alleged to have been caused by the contractor as described in that paragraph; and "(B) make a final determination, pursuant to procedures established by the Secretary for purposes of this subsection, whether the contractor, in the performance of a covered contract, caused such serious bodily injury or death through gross negligence or with reckless disregard for the safety of civilian or military personnel of the Government. "(2) Covered cases. - A case described in this paragraph is any case in which the Secretary has reason to believe that - "(A) a contractor, in the performance of a covered contract, may have caused the serious bodily injury or death of any civilian or military personnel of the Government; and "(B) such contractor is not subject to the jurisdiction of United States courts. "(3) Construction of determination. - A final determination under this subsection may be used only for the purpose of evaluating contractor performance, and shall not be determinative of fault for any other purpose. "(e) Definitions. - In this section: "(1) The term 'contractor' means a company awarded a covered contract and a subcontractor at any tier under such contract. "(2) The term 'covered contract' means a contract awarded by the Department of Defense for the procurement of goods or services. "(3) The term 'serious bodily injury' means a grievous physical harm that results in a permanent disability. "(f) Effective Date. - This section shall apply with respect to contracts entered into after the date occurring 180 days after the date of the enactment of this Act [Oct. 28, 2009]." [Pub. L. 111-383, div. A, title VIII, Sec. 834(e), Jan. 7, 2011, 124 Stat. 4279, provided that: "The requirements of section 823 of the National Defense Authorization Act for Fiscal Year 2010 [Pub. L. 111-84, set out above], as amended by subsections (a) through (c), shall apply with respect to the following: ["(1) Any contract entered into on or after the date of the enactment of this Act [Jan. 7, 2011]. ["(2) Any task order or delivery order issued on or after the date of the enactment of this Act under a contract entered into before, on, or after that date."] Pub. L. 110-329, div. C, title VIII, Sec. 8105, Sept. 30, 2008, 122 Stat. 3644, provided that: "During the current fiscal year and hereafter, none of the funds appropriated or otherwise available to the Department of Defense may be obligated or expended to provide award fees to any defense contractor contrary to the provisions of section 814 of the National Defense Authorization Act, Fiscal Year 2007 (Public Law 109-364) [set out below]." Pub. L. 109-364, div. A, title VIII, Sec. 814, Oct. 17, 2006, 120 Stat. 2321, provided that: "(a) Guidance on Linking of Award and Incentive Fees to Acquisition Outcomes. - Not later than 180 days after the date of the enactment of this Act [Oct. 17, 2006], the Secretary of Defense shall issue guidance, with detailed implementation instructions (including definitions), for the Department of Defense on the appropriate use of award and incentive fees in Department of Defense acquisition programs. "(b) Elements. - The guidance under subsection (a) shall - "(1) ensure that all new contracts using award fees link such fees to acquisition outcomes (which shall be defined in terms of program cost, schedule, and performance); "(2) establish standards for identifying the appropriate level of officials authorized to approve the use of award and incentive fees in new contracts; "(3) provide guidance on the circumstances in which contractor performance may be judged to be 'excellent' or 'superior' and the percentage of the available award fee which contractors should be paid for such performance; "(4) establish standards for determining the percentage of the available award fee, if any, which contractors should be paid for performance that is judged to be 'acceptable', 'average', 'expected', 'good', or 'satisfactory'; "(5) ensure that no award fee may be paid for contractor performance that is judged to be below satisfactory performance or performance that does not meet the basic requirements of the contract; "(6) provide specific direction on the circumstances, if any, in which it may be appropriate to roll over award fees that are not earned in one award fee period to a subsequent award fee period or periods; "(7) ensure consistent use of guidelines and definitions relating to award and incentive fees across the military departments and Defense Agencies; "(8) ensure that the Department of Defense - "(A) collects relevant data on award and incentive fees paid to contractors; and "(B) has mechanisms in place to evaluate such data on a regular basis; "(9) include performance measures to evaluate the effectiveness of award and incentive fees as a tool for improving contractor performance and achieving desired program outcomes; and "(10) provide mechanisms for sharing proven incentive strategies for the acquisition of different types of products and services among contracting and program management officials. "(c) Assessment of Independent Evaluation Mechanisms. - "(1) In general. - The Secretary of Defense shall select a federally funded research and development center to assess various mechanisms that could be used to ensure an independent evaluation of contractor performance for the purpose of making determinations applicable to the judging and payment of award fees. "(2) Considerations. - The assessment conducted pursuant to paragraph (1) shall include consideration of the advantages and disadvantages of a system in which award fees are - "(A) held in a separate fund or funds of the Department of Defense; and "(B) allocated to a specific program only upon a determination by an independent board, charged with comparing contractor performance across programs, that such fees have been earned by the contractor for such program. "(3) Report. - The Secretary shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report on the assessment conducted pursuant to paragraph (1) not later than one year after the date of the enactment of this Act [Oct. 17, 2006]." LIMITATION ON CONTRACTS FOR THE ACQUISITION OF CERTAIN SERVICES Pub. L. 109-364, div. A, title VIII, Sec. 832, Oct. 17, 2006, 120 Stat. 2331, as amended by Pub. L. 110-181, div. A, title VIII, Sec. 883, Jan. 28, 2008, 122 Stat. 264; Pub. L. 110-417, [div. A], title X, Sec. 1061(b)(5), Oct. 14, 2008, 122 Stat. 4613, provided that: "(a) Limitation. - Except as provided in subsection (b), the Secretary of Defense may not enter into a service contract to acquire a military flight simulator. "(b) Waiver. - The Secretary of Defense may waive subsection (a) with respect to a contract if the Secretary - "(1) determines that a waiver is in the national interest; and "(2) provides to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] an economic analysis as described in subsection (c) at least 30 days before the waiver takes effect. "(c) Economic Analysis. - The economic analysis provided under subsection (b) shall include, at a minimum, the following: "(1) A clear explanation of the need for the contract. "(2) An examination of at least two alternatives for fulfilling the requirements that the contract is meant to fulfill, including the following with respect to each alternative: "(A) A rationale for including the alternative. "(B) A cost estimate of the alternative and an analysis of the quality of each cost estimate. "(C) A discussion of the benefits to be realized from the alternative. "(D) A best value determination of each alternative and a detailed explanation of the life-cycle cost calculations used in the determination. "(d) Definitions. - In this section: "(1) The term 'military flight simulator' means any major system to simulate the form, fit, and function of a military aircraft that has no commonly available commercial variant. "(2) The term 'service contract' means any contract entered into by the Department of Defense the principal purpose of which is to furnish services in the United States through the use of service employees. "(3) The term 'service employees' has the meaning provided in section 8(b) of the Service Contract Act of 1965 ([former] 41 U.S.C. 357(b)) [now 41 U.S.C. 6701(3)]. "(e) Effect on Existing Contracts. - The limitation in subsection (a) does not apply to any service contract of a military department to acquire a military flight simulator, or to any renewal or extension of, or follow-on contract to, such a contract, if - "(1) the contract was in effect as of October 17, 2006; "(2) the number of flight simulators to be acquired under the contract (or renewal, extension, or follow-on) will not result in the total number of flight simulators acquired by the military department concerned through service contracts to exceed the total number of flight simulators to be acquired under all service contracts of such department for such simulators in effect as of October 17, 2006; and "(3) in the case of a renewal or extension of, or follow-on contract to, the contract, the Secretary of the military department concerned provides to the congressional defense committees a written notice of the decision to exercise an option to renew or extend the contract, or to issue a solicitation for bids or proposals using competitive procedures for a follow-on contract, and an economic analysis as described in subsection (c) supporting the decision, at least 30 days before carrying out such decision." CONGRESSIONAL NOTIFICATION OF CANCELLATION OF MAJOR AUTOMATED INFORMATION SYSTEMS Pub. L. 109-163, div. A, title VIII, Sec. 806, Jan. 6, 2006, 119 Stat. 3373, provided that: "(a) Report Required. - The Secretary of Defense shall notify the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] not less than 60 days before cancelling a major automated information system program that has been fielded or approved to be fielded, or making a change that will significantly reduce the scope of such a program, of the proposed cancellation or change. "(b) Content. - Each notification submitted under subsection (a) with respect to a proposed cancellation or change shall include - "(1) the specific justification for the proposed cancellation or change; "(2) a description of the impact of the proposed cancellation or change on the ability of the Department to achieve the objectives of the program proposed for cancellation or change; "(3) a description of the steps that the Department plans to take to achieve those objectives; and "(4) other information relevant to the change in acquisition strategy. "(c) Definitions. - In this section: "(1) The term 'major automated information system' has the meaning given that term in Department of Defense directive 5000.1. "(2) The term 'approved to be fielded' means having received Milestone C approval." JOINT POLICY ON CONTINGENCY CONTRACTING Pub. L. 109-163, div. A, title VIII, Sec. 817, Jan. 6, 2006, 119 Stat. 3382, provided that: "(a) Joint Policy. - "(1) Requirement. - Not later than one year after the date of the enactment of this Act [Jan. 6, 2006], the Secretary of Defense, in consultation with the Chairman of the Joint Chiefs of Staff, shall develop a joint policy for contingency contracting during combat operations and post-conflict operations. "(2) Matters covered. - The joint policy for contingency contracting required by paragraph (1) shall, at a minimum, provide for - "(A) the designation of a senior commissioned officer in each military department with the responsibility for administering the policy; "(B) the assignment of a senior commissioned officer with appropriate acquisition experience and qualifications to act as head of contingency contracting during combat operations, post- conflict operations, and contingency operations, who shall report directly to the commander of the combatant command in whose area of responsibility the operations occur; "(C) an organizational approach to contingency contracting that is designed to ensure that each military department is prepared to conduct contingency contracting during combat operations and post-conflict operations; "(D) a requirement to provide training (including training under a program to be created by the Defense Acquisition University) to contingency contracting personnel in - "(i) the use of law, regulations, policies, and directives related to contingency contracting operations; "(ii) the appropriate use of rapid acquisition methods, including the use of exceptions to competition requirements under section 2304 of title 10, United States Code, sealed bidding, letter contracts, indefinite delivery indefinite quantity task orders, set asides under section 8(a) of the Small Business Act (15 U.S.C. 637(a)), undefinitized contract actions, and other tools available to expedite the delivery of goods and services during combat operations or post- conflict operations; "(iii) the appropriate use of rapid acquisition authority, commanders' emergency response program funds, and other tools unique to contingency contracting; and "(iv) instruction on the necessity for the prompt transition from the use of rapid acquisition authority to the use of full and open competition and other methods of contracting that maximize transparency in the acquisition process; "(E) appropriate steps to ensure that training is maintained for such personnel even when they are not deployed in a contingency operation; and "(F) such steps as may be needed to ensure jointness and cross-service coordination in the area of contingency contracting. "(b) Reports. - "(1) Interim report. - "(A) Requirement. - Not later than 270 days after the date of the enactment of this Act [Jan. 6, 2006], the Secretary of Defense shall submit to the Committees on Armed Services of the Senate and the House of Representatives an interim report on contingency contracting. "(B) Matters covered. - The report shall include discussions of the following: "(i) Progress in the development of the joint policy under subsection (a). "(ii) The ability of the Armed Forces to support contingency contracting. "(iii) The ability of commanders of combatant commands to request contingency contracting support and the ability of the military departments and the acquisition support agencies to respond to such requests and provide such support, including the availability of rapid acquisition personnel for such support. "(iv) The ability of the current civilian and military acquisition workforce to deploy to combat theaters of operations and to conduct contracting activities during combat and during post-conflict, reconstruction, or other contingency operations. "(v) The effect of different periods of deployment on continuity in the acquisition process. "(2) Final report. - Not later than 18 months after the date of the enactment of this Act [Jan. 6, 2006], the Secretary of Defense shall submit to the committees listed in paragraph (1)(A) a final report on contingency contracting, containing a discussion of the implementation of the joint policy developed under subsection (a), including updated discussions of the matters covered in the interim report. "(c) Definitions. - In this section: "(1) Contingency contracting personnel. - The term 'contingency contracting personnel' means members of the Armed Forces and civilian employees of the Department of Defense who are members of the defense acquisition workforce and, as part of their duties, are assigned to provide support to contingency operations (whether deployed or not). "(2) Contingency contracting. - The term 'contingency contracting' means all stages of the process of acquiring property or services by the Department of Defense during a contingency operation. "(3) Contingency operation. - The term 'contingency operation' has the meaning provided in section 101(13) of title 10, United States Code. "(4) Acquisition support agencies. - The term 'acquisition support agencies' means Defense Agencies and Department of Defense Field Activities that carry out and provide support for acquisition-related activities." PROHIBITION ON PROCUREMENTS FROM COMMUNIST CHINESE MILITARY COMPANIES Pub. L. 109-163, div. A, title XII, Sec. 1211, Jan. 6, 2006, 119 Stat. 3461, as amended by Pub. L. 112-81, div. A, title XII, Sec. 1243(a), (b), Dec. 31, 2011, 125 Stat. 1645, provided that: "(a) Prohibition. - The Secretary of Defense may not procure goods or services described in subsection (b), through a contract or any subcontract (at any tier) under a contract, from any Communist Chinese military company. "(b) Goods and Services Covered. - For purposes of subsection (a), the goods and services described in this subsection are goods and services on the munitions list of the International Trafficking in Arms Regulations, other than goods or services procured - "(1) in connection with a visit by a vessel or an aircraft of the United States Armed Forces to the People's Republic of China; "(2) for testing purposes; or "(3) for purposes of gathering intelligence. "(c) Waiver Authorized. - The Secretary of Defense may waive the prohibition in subsection (a) if the Secretary determines that such a waiver is necessary for national security purposes and the Secretary submits to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report described in subsection (d) not less than 15 days before issuing the waiver under this subsection. "(d) Report. - The report referred to in subsection (c) is a report that identifies the specific reasons for the waiver issued under subsection (c) and includes recommendations as to what actions may be taken to develop alternative sourcing capabilities in the future. "(e) Definitions. - In this section: "(1) The term 'Communist Chinese military company' has the meaning provided that term by section 1237(b)(4) of the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999 [Pub. L. 105-261] (50 U.S.C. 1701 note). "(2) The term 'munitions list of the International Trafficking in Arms Regulations' means the United States Munitions List contained in part 121 of subchapter M of title 22 of the Code of Federal Regulations." [Pub. L. 112-81, div. A, title XII, Sec. 1243(c), Dec. 31, 2011, 125 Stat. 1646, provided that: "The amendments made by this section [amending section 1211 of Pub. L. 109-163, set out above] take effect on the date of the enactment of this Act [Dec. 31, 2011] and apply with respect to contracts and subcontracts of the Department of Defense entered into on or after the date of the enactment of this Act."] DEVELOPMENT OF DEPLOYABLE SYSTEMS TO INCLUDE CONSIDERATION OF FORCE PROTECTION IN ASYMMETRIC THREAT ENVIRONMENTS Pub. L. 108-375, div. A, title I, Sec. 141, Oct. 28, 2004, 118 Stat. 1829, provided that: "(a) Requirement for Systems Development. - The Secretary of Defense shall require that the Department of Defense regulations, directives, and guidance governing the acquisition of covered systems be revised to require that - "(1) an assessment of warfighter survivability and of system suitability against asymmetric threats shall be performed as part of the development of system requirements for any such system; and "(2) requirements for key performance parameters for force protection and survivability shall be included as part of the documentation of system requirements for any such system. "(b) Covered Systems. - In this section, the term 'covered system' means any of the following systems that is expected to be deployed in an asymmetric threat environment: "(1) Any manned system. "(2) Any equipment intended to enhance personnel survivability. "(c) Inapplicability of Development Requirement to Systems Already Through Development. - The revisions pursuant subsection (a) to Department of Defense regulations, directives, and guidance shall not apply to a system that entered low-rate initial production before the date of the enactment of this Act [Oct. 28, 2004]. "(d) Deadline for Policy Revisions. - The revisions required by subsection (a) to Department of Defense regulations, directives, and guidance shall be made not later than 120 days after the date of the enactment of this Act [Oct. 28, 2004]." INTERNAL CONTROLS FOR DEPARTMENT OF DEFENSE PROCUREMENTS THROUGH GSA CLIENT SUPPORT CENTERS Pub. L. 108-375, div. A, title VIII, Sec. 802, Oct. 28, 2004, 118 Stat. 2004, as amended by Pub. L. 109-313, Sec. 2(c)(2), Oct. 6, 2006, 120 Stat. 1735, provided that: "(a) Initial Inspector General Review and Determination. - (1) Not later than March 15, 2005, the Inspector General of the Department of Defense and the Inspector General of the General Services Administration shall jointly - "(A) review - "(i) the policies, procedures, and internal controls of each GSA Client Support Center; and "(ii) the administration of those policies, procedures, and internal controls; and "(B) for each such Center, determine in writing whether - "(i) the Center is compliant with defense procurement requirements; "(ii) the Center is not compliant with defense procurement requirements, but the Center made significant progress during 2004 toward becoming compliant with defense procurement requirements; or "(iii) neither of the conclusions stated in clauses (i) and (ii) is correct. "(2) If the Inspectors General determine under paragraph (1) that the conclusion stated in clause (ii) or (iii) of subparagraph (B) of such paragraph is correct in the case of a GSA Client Support Center, those Inspectors General shall, not later than March 15, 2006, jointly - "(A) conduct a second review regarding that GSA Client Support Center as described in paragraph (1)(A); and "(B) determine in writing whether that GSA Client Support Center is or is not compliant with defense procurement requirements. "(b) Compliance With Defense Procurement Requirements. - For the purposes of this section, a GSA Client Support Center is compliant with defense procurement requirements if the GSA Client Support Center's policies, procedures, and internal controls, and the manner in which they are administered, are adequate to ensure compliance of that Center with the requirements of laws and regulations that apply to procurements of property and services made directly by the Department of Defense. "(c) Limitations on Procurements Through GSA Client Support Centers. - (1) After March 15, 2005, and before March 16, 2006, no official of the Department of Defense may, except as provided in subsection (d) or (e), order, purchase, or otherwise procure property or services in an amount in excess of $100,000 through any GSA Client Support Center for which a determination described in paragraph (1)(B)(iii) of subsection (a) has been made under that subsection. "(2) After March 15, 2006, no official of the Department of Defense may, except as provided in subsection (d) or (e), order, purchase, or otherwise procure property or services in an amount in excess of $100,000 through any GSA Client Support Center that has not been determined under this section as being compliant with defense procurement requirements. "(d) Exception From Applicability of Limitations. - (1) No limitation applies under subsection (c) with respect to the procurement of property and services from a particular GSA Client Support Center during any period that there is in effect a determination of the Under Secretary of Defense for Acquisition, Technology, and Logistics, made in writing, that it is necessary in the interest of the Department of Defense to continue to procure property and services through that GSA Client Support Center. "(2) A written determination with respect to a GSA Client Support Center under paragraph (1) is in effect for the period, not in excess of one year, that the Under Secretary of Defense for Acquisition, Technology, and Logistics shall specify in the written determination. The Under Secretary may extend from time to time, for up to one year at a time, the period for which the written determination remains in effect. "(e) Termination of Applicability of Limitations. - Subsection (c) shall cease to apply to a GSA Client Support Center on the date on which the Inspector General of the Department of Defense and the Inspector General of the General Services Administration jointly determine that such Center is compliant with defense procurement requirements and notify the Secretary of Defense of that determination. "(f) GSA Client Support Center Defined. - In this section, the term 'GSA Client Support Center' means a Client Support Center of the Federal Acquisition Service of the General Services Administration." QUALITY CONTROL IN PROCUREMENT OF AVIATION CRITICAL SAFETY ITEMS AND RELATED SERVICES Pub. L. 108-136, div. A, title VIII, Sec. 802(a)-(c), Nov. 24, 2003, 117 Stat. 1540, provided that: "(a) Quality Control Policy. - The Secretary of Defense shall prescribe in regulations a quality control policy for the procurement of aviation critical safety items and the procurement of modifications, repair, and overhaul of such items. "(b) Content of Regulations. - The policy set forth in the regulations shall include the following requirements: "(1) That the head of the design control activity for aviation critical safety items establish processes to identify and manage the procurement, modification, repair, and overhaul of aviation critical safety items. "(2) That the head of the contracting activity for an aviation critical safety item enter into a contract for the procurement, modification, repair, or overhaul of such item only with a source approved by the design control activity in accordance with section 2319 of title 10, United States Code. "(3) That the aviation critical safety items delivered, and the services performed with respect to aviation critical safety items, meet all technical and quality requirements specified by the design control activity. "(c) Definitions. - In this section, the terms 'aviation critical safety item' and 'design control activity' have the meanings given such terms in section 2319(g) of title 10, United States Code, as amended by subsection (d)." COMPETITIVE AWARD OF CONTRACTS FOR RECONSTRUCTION ACTIVITIES IN IRAQ Pub. L. 108-136, div. A, title VIII, Sec. 805(a), Nov. 24, 2003, 117 Stat. 1542, provided that: "The Department of Defense shall fully comply with chapter 137 of title 10, United States Code, and other applicable procurement laws and regulations for any contract awarded for reconstruction activities in Iraq, and shall conduct a full and open competition for performing work needed for the reconstruction of the Iraqi oil industry." DEMONSTRATION PROJECT FOR CONTRACTORS EMPLOYING PERSONS WITH DISABILITIES Pub. L. 108-136, div. A, title VIII, Sec. 853, Nov. 24, 2003, 117 Stat. 1557, as amended by Pub. L. 108-199, div. H, Sec. 110, Jan. 23, 2004, 118 Stat. 438, provided that: "(a) Authority. - The Secretary of Defense may carry out a demonstration project by entering into one or more contracts with an eligible contractor for the purpose of providing defense contracting opportunities for severely disabled individuals. "(b) Evaluation Factor. - In evaluating an offer for a contract under the demonstration program, the percentage of the total workforce of the offeror consisting of severely disabled individuals employed by the offeror shall be one of the evaluation factors. "(c) Credit Toward Certain Small Business Contracting Goals. - Department of Defense contracts entered into with eligible contractors under the demonstration project under this section, and subcontracts entered into with eligible contractors under such contracts, shall be credited toward the attainment of goals established under section 2323 of title 10, United States Code, and section 15(g)(1) of the Small Business Act (15 U.S.C. 644(g)(1)) regarding the extent of the participation of disadvantaged small business concerns in contracts of the Department of Defense and subcontracts under such contracts. "(d) Definitions. - In this section: "(1) Eligible contractor. - The term 'eligible contractor' means a business entity operated on a for-profit or nonprofit basis that - "(A) employs severely disabled individuals at a rate that averages not less than 33 percent of its total workforce over a period prescribed by the Secretary; "(B) pays not less than the minimum wage prescribed pursuant to section 6 of the Fair Labor Standards Act of 1938 (29 U.S.C. 206) to the employees who are severely disabled individuals; and "(C) provides for its employees health insurance and a retirement plan comparable to those provided for employees by business entities of similar size in its industrial sector or geographic region. "(2) Severely disabled individual. - The term 'severely disabled individual' means an individual with a disability (as defined in section 3 of the Americans with Disabilities Act of 1990 (42 U.S.C. 12102)) who has a severe physical or mental impairment that seriously limits one or more functional capacities." PROCUREMENT OF DEFENSE BIOMEDICAL COUNTERMEASURES Pub. L. 108-136, div. A, title XVI, Sec. 1602, Nov. 24, 2003, 117 Stat. 1682, as amended by Pub. L. 110-181, div. A, title X, Sec. 1063(g)(3), Jan. 28, 2008, 122 Stat. 324, provided that: "(a) Determination of Material Threats. - (1) The Secretary of Defense (in this section referred to as the 'Secretary') shall on an ongoing basis - "(A) assess current and emerging threats of use of biological, chemical, radiological, and nuclear agents; and "(B) identify, on the basis of such assessment, those agents that present a material risk of use against the Armed Forces. "(2) The Secretary shall on an ongoing basis - "(A) assess the potential consequences to the health of members of the Armed Forces of use against the Armed Forces of the agents identified under paragraph (1)(B); and "(B) identify, on the basis of such assessment, those agents for which countermeasures are necessary to protect the health of members of the Armed Forces. "(b) Assessment of Availability and Appropriateness of Countermeasures. - The Secretary shall on an ongoing basis assess the availability and appropriateness of specific countermeasures to address specific threats identified under subsection (a). "(c) Secretary's Determination of Countermeasures Appropriate for Procurement. - (1) The Secretary, in accordance with paragraph (2), shall on an ongoing basis identify specific countermeasures that the Secretary determines to be appropriate for procurement for the Department of Defense stockpile of biomedical countermeasures. "(2) The Secretary may not identify a specific countermeasure under paragraph (1) unless the Secretary determines that - "(A) the countermeasure is a qualified countermeasure; and "(B) it is reasonable to expect that producing and delivering, within 5 years, the quantity of that countermeasure required to meet the needs of the Department (as determined by the Secretary) is feasible. "(d) Interagency Cooperation. - (1) Activities of the Secretary under this section shall be carried out in regular, structured, and close consultation and coordination with the Secretaries of Homeland Security and Health and Human Services, including the activities described in subsections (a), (b), and (c) and those activities with respect to interagency agreements described in paragraph (2). "(2) The Secretary may enter into an interagency agreement with the Secretaries of Homeland Security and Health and Human Services to provide for acquisition by the Secretary of Defense for use by the Armed Forces of biomedical countermeasures procured for the Strategic National Stockpile by the Secretary of Health and Human Services. The Secretary may transfer such funds to the Secretary of Health and Human Services as are necessary to carry out such agreements (including administrative costs of the Secretary of Health and Human Services), and the Secretary of Health and Human Services may expend any such transferred funds to procure such countermeasures for use by the Armed Forces, or to replenish the stockpile. The Secretaries are authorized to establish such terms and conditions for such agreements as the Secretaries determine to be in the public interest. The transfer authority provided under this paragraph is in addition to any other transfer authority available to the Secretary. "(e) Definitions. - In this section: "(1) The term 'qualified countermeasure' means a biomedical countermeasure - "(A) that is approved under section 505(a) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355) or licensed under section 351 of the Public Health Service Act (42 U.S.C. 262), or that is approved under section 515 or cleared under section 510(k) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 360e and 360) for use as such a countermeasure to a biological, chemical, radiological, or nuclear agent identified as a material threat under subsection (a); or "(B) with respect to which the Secretary of Health and Human Services makes a determination that sufficient and satisfactory clinical experience or research data (including data, if available, from preclinical and clinical trials) exists to support a reasonable conclusion that the product will qualify for such approval or licensing for use as such a countermeasure. "(2) The term 'biomedical countermeasure' means a drug (as defined in section 201(g)(1) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 321(g)(1))), device (as defined in section 201(h) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 321(h))), or biological product (as defined in section 351(i) of the Public Health Service Act (42 U.S.C. 262(i))) that is - "(A) used to treat, identify, or prevent harm from any biological, chemical, radiological, or nuclear agent that may cause a military health emergency affecting the Armed Forces; or "(B) used to treat, identify, or prevent harm from a condition that may result in adverse health consequences or death and may be caused by administering a drug or biological product that is used as described in subparagraph (A). "(3) The term 'Strategic National Stockpile' means the stockpile established under section 121(a) of the Public Health Security and Bioterrorism Preparedness and Response Act of 2002 (42 U.S.C. 300hh-12(a)). "(f) Funding. - Of the amount authorized to be appropriated for the Department of Defense and available within the transfer authority established under section 1001 of this Act [117 Stat. 1582] for fiscal year 2004 and for each fiscal year thereafter, such sums are authorized as may be necessary for the costs incurred by the Secretary in the procurement of countermeasures under this section." ENCOURAGEMENT OF SMALL BUSINESSES AND NONTRADITIONAL DEFENSE CONTRACTORS TO SUBMIT PROPOSALS POTENTIALLY BENEFICIAL FOR COMBATING TERRORISM Pub. L. 107-314, div. A, title II, Sec. 244, Dec. 2, 2002, 116 Stat. 2498, provided that during fiscal years 2003, 2004, and 2005, the Secretary of Defense, acting through the Under Secretary of Defense for Acquisition, Technology, and Logistics, was to carry out a program of outreach to small businesses and nontraditional defense contractors with the purpose of providing a process for reviewing and evaluating research activities of, and new technologies being developed by, small businesses and nontraditional defense contractors that had the potential for meeting a defense requirement or technology development goal of the Department of Defense that related to the mission of the Department of Defense to combat terrorism. PROCUREMENT OF ENVIRONMENTALLY PREFERABLE PROCUREMENT ITEMS Pub. L. 107-314, div. A, title III, Sec. 314, Dec. 2, 2002, 116 Stat. 2508, as amended by Pub. L. 109-163, div. A, title X, Sec. 1056(e)(1), Jan. 6, 2006, 119 Stat. 3440, provided that: "(a) Tracking System. - The Secretary of Defense shall develop and implement an effective and efficient tracking system to identify the extent to which the Defense Logistics Agency procures environmentally preferable procurement items or procurement items made with recovered material. The system shall provide for the separate tracking, to the maximum extent practicable, of the procurement of each category of procurement items that, as of the date of the enactment of this Act [Dec. 2, 2002], has been determined to be environmentally preferable or made with recovered material. "(b) Assessment of Training and Education. - The Secretary of Defense shall assess the need to establish a program, or enhance existing programs, for training and educating Department of Defense procurement officials to ensure that they are aware of any Department requirements, preferences, or goals for the procurement of environmentally preferable procurement items or procurement items made with recovered material. "(c) Reporting Requirement. - Not later than March 1, 2004, and each March 1 thereafter through 2007, the Secretary of Defense shall submit to the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives a report detailing the results obtained from the tracking system developed under subsection (a). "(d) Relation to Other Laws. - Nothing in this section shall be construed to alter the requirements of the Solid Waste Disposal Act (42 U.S.C. 6901 et seq.). "(e) Definitions. - In this section: "(1) The term 'environmentally preferable', in the case of a procurement item, means that the item has a lesser or reduced effect on human health and the environment when compared with competing products that serve the same purpose. The comparison may consider raw materials acquisition, production, manufacturing, packaging, distribution, reuse, operation, maintenance, or disposal of the product. "(2) The terms 'procurement item' and 'recovered material' have the meanings given such terms in section 1004 of the Solid Waste Disposal Act (42 U.S.C. 6903)." POLICY REGARDING ACQUISITION OF INFORMATION ASSURANCE AND INFORMATION ASSURANCE-ENABLED INFORMATION TECHNOLOGY PRODUCTS Pub. L. 107-314, div. A, title III, Sec. 352, Dec. 2, 2002, 116 Stat. 2518, provided that: "(a) Establishment of Policy. - The Secretary of Defense shall establish a policy to limit the acquisition of information assurance and information assurance-enabled information technology products to those products that have been evaluated and validated in accordance with appropriate criteria, schemes, or programs. "(b) Waiver. - As part of the policy, the Secretary of Defense shall authorize specified officials of the Department of Defense to waive the limitations of the policy upon a determination in writing that application of the limitations to the acquisition of a particular information assurance or information assurance-enabled information technology product would not be in the national security interest of the United States. "(c) Implementation. - The Secretary of Defense shall ensure that the policy is uniformly implemented throughout the Department of Defense." LOGISTICS SUPPORT AND SERVICES FOR WEAPON SYSTEMS CONTRACTORS Pub. L. 107-314, div. A, title III, Sec. 365, Dec. 2, 2002, 116 Stat. 2520, as amended by Pub. L. 109-163, div. A, title III, Sec. 331, Jan. 6, 2006, 119 Stat. 3195, authorized the Secretary of Defense to make certain logistics support and services available to weapon systems contractors and provided for the expiration of such authority on Sept. 30, 2010. IMPROVEMENT OF SOFTWARE ACQUISITION PROCESSES Pub. L. 107-314, div. A, title VIII, Sec. 804, Dec. 2, 2002, 116 Stat. 2604, provided that: "(a) Establishment of Programs. - (1) The Secretary of each military department shall establish a program to improve the software acquisition processes of that military department. "(2) The head of each Defense Agency that manages a major defense acquisition program with a substantial software component shall establish a program to improve the software acquisition processes of that Defense Agency. "(3) The programs required by this subsection shall be established not later than 120 days after the date of the enactment of this Act [Dec. 2, 2002]. "(b) Program Requirements. - A program to improve software acquisition processes under this section shall, at a minimum, include the following: "(1) A documented process for software acquisition planning, requirements development and management, project management and oversight, and risk management. "(2) Efforts to develop appropriate metrics for performance measurement and continual process improvement. "(3) A process to ensure that key program personnel have an appropriate level of experience or training in software acquisition. "(4) A process to ensure that each military department and Defense Agency implements and adheres to established processes and requirements relating to the acquisition of software. "(c) Department of Defense Guidance. - The Assistant Secretary of Defense for Command, Control, Communications, and Intelligence, in consultation with the Under Secretary of Defense for Acquisition, Technology, and Logistics, shall - "(1) prescribe uniformly applicable guidance for the administration of all of the programs established under subsection (a) and take such actions as are necessary to ensure that the military departments and Defense Agencies comply with the guidance; and "(2) assist the Secretaries of the military departments and the heads of the Defense Agencies to carry out such programs effectively by - "(A) ensuring that the criteria applicable to the selection of sources provides added emphasis on past performance of potential sources, as well as on the maturity of the software products offered by the potential sources; and "(B) identifying, and serving as a clearinghouse for information regarding, best practices in software development and acquisition in both the public and private sectors. "(d) Definitions. - In this section: "(1) The term 'Defense Agency' has the meaning given the term in section 101(a)(11) of title 10, United States Code. "(2) The term 'major defense acquisition program' has the meaning given such term in section 139(a)(2)(B) of title 10, United States Code." RAPID ACQUISITION AND DEPLOYMENT PROCEDURES Pub. L. 107-314, div. A, title VIII, Sec. 806, Dec. 2, 2002, 116 Stat. 2607, as amended by Pub. L. 108-136, div. A, title VIII, Sec. 845, Nov. 24, 2003, 117 Stat. 1553; Pub. L. 108-375, div. A, title VIII, Sec. 811, Oct. 28, 2004, 118 Stat. 2012; Pub. L. 109-364, div. A, title X, Sec. 1071(h), Oct. 17, 2006, 120 Stat. 2403; Pub. L. 111-383, div. A, title VIII, Sec. 803, Jan. 7, 2011, 124 Stat. 4255; Pub. L. 112-81, div. A, title VIII, Sec. 845(a), (b), Dec. 31, 2011, 125 Stat. 1515, provided that: "(a) Requirement To Establish Procedures. - Not later than 180 days after the date of the enactment of this Act [Dec. 2, 2002], the Secretary of Defense shall prescribe procedures for the rapid acquisition and deployment of supplies and associated support services that are - "(1)(A) currently under development by the Department of Defense or available from the commercial sector; or "(B) require only minor modifications to supplies described in subparagraph (A); "(2) urgently needed to react to an enemy threat or to respond to significant and urgent safety situations. "(b) Issues To Be Addressed. - The procedures prescribed under subsection (a) shall include the following: "(1) A process for streamlined communications between the Chairman of the Joint Chiefs of Staff, the acquisition community, and the research and development community, including - "(A) a process for the commanders of the combatant commands and the Joint Chiefs of Staff to communicate their needs to the acquisition community and the research and development community; and "(B) a process for the acquisition community and the research and development community to propose supplies and associated support services that meet the needs communicated by the combatant commands and the Joint Chiefs of Staff. "(2) Procedures for demonstrating, rapidly acquiring, and deploying supplies and associated support services proposed pursuant to paragraph (1)(B), including - "(A) a process for demonstrating performance and evaluating for current operational purposes the existing capability of the supplies and associated support services; "(B) a process for developing an acquisition and funding strategy for the deployment of the supplies and associated support services; and "(C) a process for making deployment and utilization determinations based on information obtained pursuant to subparagraphs (A) and (B). "(c) Response to Combat Emergencies. - (1) In the case of any supplies and associated support services that, as determined in writing by the Secretary of Defense without delegation, are urgently needed to eliminate a deficiency that has resulted in combat casualties, or is likely to result in combat casualties, the Secretary shall use the procedures developed under this section in order to accomplish the rapid acquisition and deployment of the needed supplies and associated support services. "(2)(A) Whenever the Secretary makes a determination under paragraph (1) that certain supplies and associated support services are urgently needed to eliminate a deficiency that has resulted in combat casualties, or is likely to result in combat casualties, the Secretary shall designate a senior official of the Department of Defense to ensure that the needed supplies and associated support services are acquired and deployed as quickly as possible, with a goal of awarding a contract for the acquisition of the supplies and associated support services within 15 days. "(B) Upon designation of a senior official under subparagraph (A), the Secretary shall authorize that official to waive any provision of law, policy, directive, or regulation described in subsection (d) that such official determines in writing would unnecessarily impede the rapid acquisition and deployment of the needed supplies and associated support services. In a case in which the needed supplies and associated support services cannot be acquired without an extensive delay, the senior official shall require that an interim solution be implemented and deployed using the procedures developed under this section to minimize the deficiency and combat casualties. "(3) In any fiscal year in which the Secretary makes a determination described in paragraph (1), the Secretary may use any funds available to the Department of Defense for that fiscal year for acquisitions of supplies and associated support services under this section if the determination includes a written finding that the use of such funds is necessary to address the combat capability deficiency in a timely manner. The authority of this section may not be used to acquire supplies and associated support services in an amount aggregating more than $200,000,000 during any such fiscal year. "(4) The Secretary of Defense shall, in consultation with the Director of the Office of Management and Budget, notify the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] within 15 days after each determination made under paragraph (1). For each such determination, the notice under the preceding sentence shall identify - "(A) the supplies and associated support services to be acquired; "(B) the amount anticipated to be expended for the acquisition; and "(C) the source of funds for the acquisition. "(5) Any acquisition initiated under this subsection shall transition to the normal acquisition system not later than two years after the date on which the Secretary makes the determination described in paragraph (1) with respect to the supplies and associated support services concerned. "(d) Waiver of Certain Statutes and Regulations. - (1) Upon a determination described in subsection (c)(1), the senior official designated in accordance with subsection (c)(2) with respect to that designation is authorized to waive any provision of law, policy, directive or regulation addressing - "(A) the establishment of the requirement for the supplies and associated support services; "(B) the research, development, test, and evaluation of the supplies and associated support services; or "(C) the solicitation and selection of sources, and the award of the contract, for procurement of the supplies and associated support services. "(2) Nothing in this subsection authorizes the waiver of - "(A) the requirements of this section or the regulations implementing this section; or "(B) any provision of law imposing civil or criminal penalties. "(e) Testing Requirement. - (1) The process for demonstrating performance and evaluating for current operational purposes the existing capability of the supplies and associated support services prescribed under subsection (b)(2)(A) shall include - "(A) an operational assessment in accordance with procedures prescribed by the Director of Operational Test and Evaluation; and "(B) a requirement to provide information about any deficiency of the supplies and associated support services in meeting the original requirements for the supplies and associated support services (as stated in a statement of the urgent operational need or similar document) to the deployment decisionmaking authority. "(2) The process may not include a requirement for any deficiency of supplies and associated support services to be the determining factor in deciding whether to deploy the supplies and associated support services. "(3) If supplies and associated support services are deployed under the rapid acquisition and deployment procedures prescribed pursuant to this section, or under any other authority, before the completion of operational test and evaluation of the supplies and associated support services, the Director of Operational Test and Evaluation shall have access to operational records and data relevant to such supplies and associated support services in accordance with section 139(e)(3) of title 10, United States Code, for the purpose of completing operational test and evaluation of the supplies and associated support services. The access to the operational records and data shall be provided in a time and manner determined by the Secretary of Defense consistent with requirements of operational security and other relevant operational requirements. "(f) Limitation. - In the case of supplies that are part of a major system for which a low-rate initial production quantity determination has been made pursuant to section 2400 of title 10, United States Code, the quantity of such supplies acquired using the procedures prescribed pursuant to this section may not exceed an amount consistent with complying with limitations on the quantity of articles approved for low-rate initial production for such system. Any such supplies shall be included in any relevant calculation of quantities for low-rate initial production for the system concerned. "(g) Associated Support Services Defined. - In this section, the term 'associated support services' means training, operation, maintenance, and support services needed in connection with the deployment of supplies to be acquired pursuant to the authority of this section. The term does not include functions that are inherently governmental or otherwise exempted from private sector performance." [Pub. L. 112-81, div. A, title VIII, Sec. 845(c), Dec. 31, 2011, 125 Stat. 1515, provided that: "The authority to acquire associated support services pursuant to section 806 of the Bob Stump National Defense Authorization Act for Fiscal Year 2003 [Pub. L. 107-314, set out above], as amended by this section, shall not take effect until the Secretary of Defense certifies to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] that the Secretary has developed and implemented an expedited review process in compliance with the requirements of section 804 of the Ike Skelton National Defense Authorization Act for Fiscal Year 2011 (Public Law 111-383; 124 Stat. 4256; 10 U.S.C. 2302 note)."] PROCUREMENT OF ALTERNATIVE FUELED AND HYBRID LIGHT DUTY TRUCKS Pub. L. 107-107, div. A, title III, Sec. 318, Dec. 28, 2001, 115 Stat. 1055, provided that: "(a) Defense Fleets Not Covered by Requirement in Energy Policy Act of 1992. - (1) The Secretary of Defense shall coordinate with the Administrator of General Services to ensure that only hybrid vehicles are procured by the Administrator for the Department of Defense fleet of light duty trucks that is not in a fleet of vehicles to which section 303 of the Energy Policy Act of 1992 (42 U.S.C. 13212) applies. "(2) The Secretary, in consultation with the Administrator, may waive the policy regarding the procurement of hybrid vehicles in paragraph (1) to the extent that the Secretary determines necessary - "(A) in the case of trucks that are exempt from the requirements of section 303 of the Energy Policy Act of 1992 for national security reasons under subsection (b)(3)(E) of such section, to meet specific requirements of the Department of Defense for capabilities of light duty trucks; "(B) to procure vehicles consistent with the standards applicable to the procurement of fleet vehicles for the Federal Government; or "(C) to adjust to limitations on the commercial availability of light duty trucks that are hybrid vehicles. "(3) This subsection applies with respect to procurements of light duty trucks in fiscal year 2005 and subsequent fiscal years. "(b) Requirement To Exceed Requirement in Energy Policy Act of 1992. - (1) The Secretary of Defense shall coordinate with the Administrator of General Services to ensure that, of the light duty trucks procured in fiscal years after fiscal year 2004 for the fleets of light duty vehicles of the Department of Defense to which section 303 of the Energy Policy Act of 1992 [42 U.S.C. 13212] applies - "(A) five percent of the total number of such trucks that are procured in each of fiscal years 2005 and 2006 are alternative fueled vehicles or hybrid vehicles; and "(B) ten percent of the total number of such trucks that are procured in each fiscal year after fiscal year 2006 are alternative fueled vehicles or hybrid vehicles. "(2) Light duty trucks acquired for the Department of Defense that are counted to comply with section 303 of the Energy Policy Act of 1992 for a fiscal year shall be counted to determine the total number of light duty trucks procured for the Department of Defense for that fiscal year for the purposes of paragraph (1), but shall not be counted to satisfy the requirement in that paragraph. "(c) Report on Plans for Implementation. - At the same time that the President submits the budget for fiscal year 2003 to Congress under section 1105(a) of title 31, United States Code, the Secretary shall submit to Congress a report summarizing the plans for carrying out subsections (a) and (b). "(d) Definitions. - In this section: "(1) The term 'hybrid vehicle' means a motor vehicle that draws propulsion energy from onboard sources of stored energy that are both - "(A) an internal combustion or heat engine using combustible fuel; and "(B) a rechargeable energy storage system. "(2) The term 'alternative fueled vehicle' has the meaning given that term in section 301 of the Energy Policy Act of 1992 (42 U.S.C. 13211)." TEMPORARY EMERGENCY PROCUREMENT AUTHORITY TO FACILITATE THE DEFENSE AGAINST TERRORISM OR BIOLOGICAL OR CHEMICAL ATTACK Pub. L. 107-107, div. A, title VIII, Sec. 836, Dec. 28, 2001, 115 Stat. 1192, provided special authorities relating to increased flexibility for use of streamlined procedures and commercial item treatment for procurements of biotechnology to facilitate the defense against terrorism or biological or chemical attack which would be applicable to procurements for which funds had been obligated during fiscal years 2002 and 2003, directed the Secretary of Defense to submit to committees of Congress, not later than Mar. 1, 2002, a report containing the Secretary's recommendations for additional emergency procurement authority that the Secretary had determined necessary to support operations carried out to combat terrorism, and provided that no contract could be entered into pursuant to such authority after Sept. 30, 2003. IMPROVEMENTS IN PROCUREMENTS OF SERVICES Pub. L. 106-398, Sec. 1 [[div. A], title VIII, Sec. 821], Oct. 30, 2000, 114 Stat. 1654, 1654A-217, as amended by Pub. L. 108-136, div. A, title XIV, Sec. 1431(c), Nov. 24, 2003, 117 Stat. 1672, provided that: "(a) Preference for Performance-Based Service Contracting. - Not later than 180 days after the date of the enactment of this Act [Oct. 30, 2000], the Federal Acquisition Regulation issued in accordance with sections 6 and 25 of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 405 and 421) [see 41 U.S.C. 1121 and 1303] shall be revised to establish a preference for use of contracts and task orders for the purchase of services in the following order of precedence: "(1) A performance-based contract or performance-based task order that contains firm fixed prices for the specific tasks to be performed. "(2) Any other performance-based contract or performance-based task order. "(3) Any contract or task order that is not a performance-based contract or a performance-based task order. "[(b) Repealed. Pub. L. 108-136, div. A, title XIV, Sec. 1431(c), Nov. 24, 2003, 117 Stat. 1672.] "(c) Centers of Excellence in Service Contracting. - Not later than 180 days after the date of the enactment of this Act [Oct. 30, 2000], the Secretary of each military department shall establish at least one center of excellence in contracting for services. Each center of excellence shall assist the acquisition community by identifying, and serving as a clearinghouse for, best practices in contracting for services in the public and private sectors. "(d) Enhanced Training in Service Contracting. - (1) The Secretary of Defense shall ensure that classes focusing specifically on contracting for services are offered by the Defense Acquisition University and the Defense Systems Management College and are otherwise available to contracting personnel throughout the Department of Defense. "(2) The Secretary of each military department and the head of each Defense Agency shall ensure that the personnel of the department or agency, as the case may be, who are responsible for the awarding and management of contracts for services receive appropriate training that is focused specifically on contracting for services. "(e) Definitions. - In this section: "(1) The term 'performance-based', with respect to a contract, a task order, or contracting, means that the contract, task order, or contracting, respectively, includes the use of performance work statements that set forth contract requirements in clear, specific, and objective terms with measurable outcomes. "(2) The term 'commercial item' has the meaning given the term in section 4(12) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 403(12)) [see 41 U.S.C. 103]. "(3) The term 'Defense Agency' has the meaning given the term in section 101(a)(11) of title 10, United States Code." PROGRAM TO INCREASE BUSINESS INNOVATION IN DEFENSE ACQUISITION PROGRAMS Pub. L. 106-65, div. A, title VIII, Sec. 812(a)-(c), (e), Oct. 5, 1999, 113 Stat. 709, 710, provided that: "(a) Requirement To Develop Plan. - Not later than March 1, 2000, the Secretary of Defense shall publish in the Federal Register for public comment a plan to provide for increased innovative technology for acquisition programs of the Department of Defense from commercial private sector entities, including small-business concerns. "(b) Implementation of Plan. - Not later than March 1, 2001, the Secretary of Defense shall implement the plan required by subsection (a), subject to any modifications the Secretary may choose to make in response to comments received. "(c) Elements of Plan. - The plan required by subsection (a) shall include, at a minimum, the following elements: "(1) Procedures through which commercial private sector entities, including small-business concerns, may submit proposals recommending cost-saving and innovative ideas to acquisition program managers. "(2) A review process designed to make recommendations on the merit and viability of the proposals submitted under paragraph (1) at appropriate times during the acquisition cycle. "(3) Measures to limit potential disruptions to existing contracts and programs from proposals accepted and incorporated into acquisition programs of the Department of Defense. "(4) Measures to ensure that research and development efforts of small-business concerns are considered as early as possible in a program's acquisition planning process to accommodate potential technology insertion without disruption to existing contracts and programs. "(e) Small-Business Concern Defined. - In this section, the term 'small-business concern' has the same meaning as the meaning of such term as used in the Small Business Act (15 U.S.C. 631 et seq.)." YEAR 2000 SOFTWARE CONVERSION Pub. L. 104-201, div. A, title VIII, Sec. 831, Sept. 23, 1996, 110 Stat. 2615, directed the Secretary of Defense to ensure that all information technology acquired by the Department of Defense pursuant to contracts entered into after Sept. 30, 1996, would have the capabilities to process date and date-related data in 2000, and directed the Secretary to assess all information technology within the Department to determine the extent to which such technology would have the capabilities to operate effectively, and to submit to Congress a detailed plan for eliminating any deficiencies not later than Jan. 1, 1997. DEFENSE FACILITY-WIDE PILOT PROGRAM Pub. L. 104-106, div. A, title VIII, Sec. 822, Feb. 10, 1996, 110 Stat. 396, as amended by Pub. L. 106-65, div. A, title X, Sec. 1067(6), Oct. 5, 1999, 113 Stat. 774, provided that: "(a) Authority To Conduct Defense Facility-Wide Pilot Program. - The Secretary of Defense may conduct a pilot program, to be known as the 'defense facility-wide pilot program', for the purpose of determining the potential for increasing the efficiency and effectiveness of the acquisition process in facilities by using commercial practices on a facility-wide basis. "(b) Designation of Participating Facilities. - (1) Subject to paragraph (2), the Secretary may designate up to two facilities as participants in the defense facility-wide pilot program. "(2) The Secretary may designate for participation in the pilot program only those facilities that are authorized to be so designated in a law authorizing appropriations for national defense programs that is enacted after the date of the enactment of this Act [Feb. 10, 1996]. "(c) Scope of Program. - At a facility designated as a participant in the pilot program, the pilot program shall consist of the following: "(1) All contracts and subcontracts for defense supplies and services that are performed at the facility. "(2) All Department of Defense contracts and all subcontracts under Department of Defense contracts performed elsewhere that the Secretary determines are directly and substantially related to the production of defense supplies and services at the facility and are necessary for the pilot program. "(d) Criteria for Designation of Participating Facilities. - The Secretary shall establish criteria for selecting a facility for designation as a participant in the pilot program. In developing such criteria, the Secretary shall consider the following: "(1) The number of existing and anticipated contracts and subcontracts performed at the facility - "(A) for which contractors are required to provide certified cost or pricing data pursuant to section 2306a of title 10, United States Code; and "(B) which are administered with the application of cost accounting standards under section 26(f) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 422(f)) [now 41 U.S.C. 1502(a), (b)]. "(2) The relationship of the facility to other organizations and facilities performing under contracts with the Department of Defense and subcontracts under such contracts. "(3) The impact that the participation of the facility under the pilot program would have on competing domestic manufacturers. "(4) Such other factors as the Secretary considers appropriate. "(e) Notification. - (1) The Secretary shall transmit to the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives a written notification of each facility proposed to be designated by the Secretary for participation in the pilot program. "(2) The Secretary shall include in the notification regarding a facility designated for participation in the program a management plan addressing the following: "(A) The proposed treatment of research and development contracts or subcontracts to be performed at the facility during the pilot program. "(B) The proposed treatment of the cost impact of the use of commercial practices on the award and administration of contracts and subcontracts performed at the facility. "(C) The proposed method for reimbursing the contractor for existing and new contracts. "(D) The proposed method for measuring the performance of the facility for meeting the management goals of the Secretary. "(E) Estimates of the annual amount and the total amount of the contracts and subcontracts covered under the pilot program. "(3)(A) The Secretary shall ensure that the management plan for a facility provides for attainment of the following objectives: "(i) A significant reduction of the cost to the Government for programs carried out at the facility. "(ii) A reduction of the schedule associated with programs carried out at the facility. "(iii) An increased use of commercial practices and procedures for programs carried out at the facility. "(iv) Protection of a domestic manufacturer competing for contracts at such facility from being placed at a significant competitive disadvantage by the participation of the facility in the pilot program. "(B) The management plan for a facility shall also require that all or substantially all of the contracts to be awarded and performed at the facility after the designation of that facility under subsection (b), and all or substantially all of the subcontracts to be awarded under those contracts and performed at the facility after the designation, be - "(i) for the production of supplies or services on a firm-fixed price basis; "(ii) awarded without requiring the contractors or subcontractors to provide certified cost or pricing data pursuant to section 2306a of title 10, United States Code; and "(iii) awarded and administered without the application of cost accounting standards under section 26(f) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 422(f)) [now 41 U.S.C. 1502(a), (b)]. "(f) Exemption From Certain Requirements. - In the case of a contract or subcontract that is to be performed at a facility designated for participation in the defense facility-wide pilot program and that is subject to section 2306a of title 10, United States Code, or section 26(f) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 422(f)) [now 41 U.S.C. 1502(a), (b)], the Secretary of Defense may exempt such contract or subcontract from the requirement to obtain certified cost or pricing data under such section 2306a or the requirement to apply mandatory cost accounting standards under such section 26(f) [now 41 U.S.C. 1502(a), (b)] if the Secretary determines that the contract or subcontract - "(1) is within the scope of the pilot program (as described in subsection (c)); and "(2) is fairly and reasonably priced based on information other than certified cost and pricing data. "(g) Special Authority. - The authority provided under subsection (a) includes authority for the Secretary of Defense - "(1) to apply any amendment or repeal of a provision of law made in this Act [see Tables for classification] to the pilot program before the effective date of such amendment or repeal; and "(2) to apply to a procurement of items other than commercial items under such program - "(A) the authority provided in section 34 of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 430) [now 41 U.S.C. 1906] to waive a provision of law in the case of commercial items, and "(B) any exception applicable under this Act or the Federal Acquisition Streamlining Act of 1994 (Public Law 103-355) [see Tables for classification] (or an amendment made by a provision of either Act) in the case of commercial items, before the effective date of such provision (or amendment) to the extent that the Secretary determines necessary to test the application of such waiver or exception to procurements of items other than commercial items. "(h) Applicability. - (1) Subsections (f) and (g) apply to the following contracts, if such contracts are within the scope of the pilot program at a facility designated for the pilot program under subsection (b): "(A) A contract that is awarded or modified during the period described in paragraph (2). "(B) A contract that is awarded before the beginning of such period, that is to be performed (or may be performed), in whole or in part, during such period, and that may be modified as appropriate at no cost to the Government. "(2) The period referred to in paragraph (1), with respect to a facility designated under subsection (b), is the period that - "(A) begins 45 days after the date of the enactment of the Act authorizing the designation of that facility in accordance with paragraph (2) of such subsection; and "(B) ends on September 30, 2000. "(i) Commercial Practices Encouraged. - With respect to contracts and subcontracts within the scope of the defense facility-wide pilot program, the Secretary of Defense may, to the extent the Secretary determines appropriate and in accordance with applicable law, adopt commercial practices in the administration of contracts and subcontracts. Such commercial practices may include the following: "(1) Substitution of commercial oversight and inspection procedures for Government audit and access to records. "(2) Incorporation of commercial oversight, inspection, and acceptance procedures. "(3) Use of alternative dispute resolution techniques (including arbitration). "(4) Elimination of contract provisions authorizing the Government to make unilateral changes to contracts." ELIMINATION OF USE OF CLASS I OZONE-DEPLETING SUBSTANCES IN CERTAIN MILITARY PROCUREMENT CONTRACTS Pub. L. 102-484, div. A, title III, Sec. 326, Oct. 23, 1992, 106 Stat. 2368, as amended by Pub. L. 104-106, div. A, title XV, Secs. 1502(c)(2)(A), 1504(c)(1), Feb. 10, 1996, 110 Stat. 506, 514; Pub. L. 106-65, div. A, title X, Sec. 1067(8), Oct. 5, 1999, 113 Stat. 774, provided that: "(a) Elimination of Use of Class I Ozone-Depleting Substances. - (1) No Department of Defense contract awarded after June 1, 1993, may include a specification or standard that requires the use of a class I ozone-depleting substance or that can be met only through the use of such a substance unless the inclusion of the specification or standard in the contract is approved by the senior acquisition official for the procurement covered by the contract. The senior acquisition official may grant the approval only if the senior acquisition official determines (based upon the certification of an appropriate technical representative of the official) that a suitable substitute for the class I ozone- depleting substance is not currently available. "(2)(A)(i) Not later than 60 days after the completion of the first modification, amendment, or extension after June 1, 1993, of a contract referred to in clause (ii), the senior acquisition official (or the designee of that official) shall carry out an evaluation of the contract in order to determine - "(I) whether the contract includes a specification or standard that requires the use of a class I ozone-depleting substance or can be met only through the use of such a substance; and "(II) in the event of a determination that the contract includes such a specification or standard, whether the contract can be carried out through the use of an economically feasible substitute for the ozone-depleting substance or through the use of an economically feasible alternative technology for a technology involving the use of the ozone-depleting substance. "(ii) A contract referred to in clause (i) is any contract in an amount in excess of $10,000,000 that - "(I) was awarded before June 1, 1993; and "(II) as a result of the modification, amendment, or extension described in clause (i), will expire more than 1 year after the effective date of the modification, amendment, or extension. "(iii) A contract under evaluation under clause (i) may not be further modified, amended, or extended until the evaluation described in that clause is complete. "(B) If the acquisition official (or designee) determines that an economically feasible substitute substance or alternative technology is available for use in a contract under evaluation, the appropriate contracting officer shall enter into negotiations to modify the contract to require the use of the substitute substance or alternative technology. "(C) A determination that a substitute substance or technology is not available for use in a contract under evaluation shall be made in writing by the senior acquisition official (or designee). "(D) The Secretary of Defense may, consistent with the Federal Acquisition Regulation, adjust the price of a contract modified under subparagraph (B) to take into account the use by the contractor of a substitute substance or alternative technology in the modified contract. "(3) The senior acquisition official authorized to grant an approval under paragraph (1) and the senior acquisition official and designees authorized to carry out an evaluation and make a determination under paragraph (2) shall be determined under regulations prescribed by the Secretary of Defense. A senior acquisition official may not delegate the authority provided in paragraph (1). "(4) Each official who grants an approval authorized under paragraph (1) or makes a determination under paragraph (2)(B) shall submit to the Secretary of Defense a report on that approval or determination, as the case may be, as follows: "(A) Beginning on October 1, 1993, and continuing for 8 calendar quarters thereafter, by submitting a report on the approvals granted or determinations made under such authority during the preceding quarter not later than 30 days after the end of such quarter. "(B) Beginning on January 1, 1997, and continuing for 4 years thereafter, by submitting a report on the approvals granted or determinations made under such authority during the preceding year not later than 30 days after the end of such year. "(5) The Secretary shall promptly transmit to the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives each report submitted to the Secretary under paragraph (4). The Secretary shall transmit the report in classified and unclassified forms. "(b) Cost Recovery. - In any case in which a Department of Defense contract is modified or a specification or standard for such a contract is waived at the request of a contractor in order to permit the contractor to use in the performance of the contract a substitute for a class I ozone-depleting substance or an alternative technology for a technology involving the use of a class I ozone-depleting substance, the Secretary of Defense may adjust the price of the contract in a manner consistent with the Federal Acquisition Regulation. "(c) Definitions. - In this section: "(1) The term 'class I ozone-depleting substance' means any substance listed under section 602(a) of the Clean Air Act (42 U.S.C. 7671a(a)). "(2) The term 'Federal Acquisition Regulation' means the single Government-wide procurement regulation issued under section 25(c) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 421(c)) [now 41 U.S.C. 1303(a)]." PAYMENT PROTECTIONS FOR SUBCONTRACTORS AND SUPPLIERS Pub. L. 102-190, div. A, title VIII, Sec. 806, Dec. 5, 1991, 105 Stat. 1417, as amended by Pub. L. 102-484, div. A, title X, Sec. 1053(5), Oct. 23, 1992, 106 Stat. 2502; Pub. L. 103-355, title II, Sec. 2091, title VIII, Sec. 8105(k), Oct. 13, 1994, 108 Stat. 3306, 3393, provided that: "(a) Regulations. - The Secretary of Defense shall prescribe in regulations the following requirements: "(1) Information provided by department of defense relating to payment. - (A) Subject to section 552(b)(1) of title 5, United States Code, upon the request of a subcontractor or supplier of a contractor performing a Department of Defense contract, the Department of Defense shall promptly make available to such subcontractor or supplier the following information: "(i) Whether requests for progress payments or other payments have been submitted by the contractor to the Department of Defense in connection with that contract. "(ii) Whether final payment to the contractor has been made by the Department of Defense in connection with that contract. "(B) This paragraph shall apply with respect to any Department of Defense contract that is in effect on the date which is 270 days after the date of enactment of this Act [Dec. 5, 1991] or that is awarded after such date. "(2) Information provided by department of defense relating to payment bonds. - (A) Upon the request of a subcontractor or supplier described in subparagraph (B), the Department of Defense shall promptly make available to such subcontractor or supplier any of the following: "(i) The name and address of the surety or sureties on the payment bond. "(ii) The penal amount of the payment bond. "(iii) A copy of the payment bond. "(B) Subparagraph (A) applies to - "(i) a subcontractor or supplier having a subcontract, purchase order, or other agreement to furnish labor or material for the performance of a Department of Defense contract with respect to which a payment bond has been furnished to the United States pursuant to the Miller Act; and "(ii) a prospective subcontractor or supplier offering to furnish labor or material for the performance of such a Department of Defense contract. "(C) With respect to the information referred to in subparagraphs (A)(i) and (A)(ii), the regulations shall include authority for such information to be provided verbally to the subcontractor or supplier. "(D) With respect to the information referred to in subparagraph (A)(iii), the regulations may impose reasonable fees to cover the cost of copying and providing requested bonds. "(E) This paragraph shall apply with respect to any Department of Defense contract covered by the Miller Act that is in effect on the date which is 270 days after the date of enactment of this Act [Dec. 5, 1991] or that is awarded after such date. "(3) Information provided by contractors relating to payment bonds. - (A) Upon the request of a prospective subcontractor or supplier offering to furnish labor or material for the performance of a Department of Defense contract with respect to which a payment bond has been furnished to the United States pursuant to the Miller Act, the contractor shall promptly make available to such prospective subcontractor or supplier a copy of the payment bond. "(B) This paragraph shall apply with respect to any Department of Defense contract covered by the Miller Act for which a solicitation is issued after the expiration of the 60-day period beginning on the effective date of the regulations promulgated under this subsection. "(4) Procedures relating to compliance with payment terms. - (A) Under procedures established in the regulations, upon the assertion by a subcontractor or supplier of a contractor performing a Department of Defense contract that the subcontractor or supplier has not been paid by the prime contractor in accordance with the payment terms of the subcontract, purchase order, or other agreement with the prime contractor, the contracting officer may determine the following: "(i) With respect to a construction contract, whether the contractor has made progress payments to the subcontractor or supplier in compliance with chapter 39 of title 31, United States Code. "(ii) With respect to a contract other than a construction contract, whether the contractor has made progress or other payments to the subcontractor or supplier in compliance with the terms of the subcontract, purchase order, or other agreement with the prime contractor. "(iii) With respect to either a construction contract or a contract other than a construction contract, whether the contractor has made final payment to the subcontractor or supplier in compliance with the terms of the subcontract, purchase order, or other agreement with the prime contractor. "(iv) With respect to either a construction contract or a contract other than a construction contract, whether any certification of payment of the subcontractor or supplier accompanying the contractor's payment request to the Government is accurate. "(B) If the contracting officer determines that the prime contractor is not in compliance with any matter referred to in clause (i), (ii), or (iii) of subparagraph (A), the contracting officer may, under procedures established in the regulations - "(i) encourage the prime contractor to make timely payment to the subcontractor or supplier; or "(ii) reduce or suspend progress payments with respect to amounts due to the prime contractor. "(C) If the contracting officer determines that a certification referred to in clause (iv) of subparagraph (A) is inaccurate in any material respect, the contracting officer shall, under procedures established in the regulations, initiate appropriate administrative or other remedial action. "(D) This paragraph shall apply with respect to any Department of Defense contract that is in effect on the date of promulgation of the regulations under this subsection or that is awarded after such date. "(b) Inapplicability to Certain Contracts. - Regulations prescribed under this section shall not apply to a contract for the acquisition of commercial items (as defined in section 4(12) of the Office of Federal Procurement Policy Act [see 41 U.S.C. 103]). "(c) Government-Wide Applicability. - The Federal Acquisition Regulatory Council (established by section 25(a) of the Office of Federal Procurement Policy Act) [now 41 U.S.C. 1302(a)] shall modify the Federal Acquisition Regulation (issued pursuant to section 25(c)(1) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 421(c)(1))[)] [now 41 U.S.C. 1303(a)(1)] to apply Government-wide the requirements that the Secretary is required under subsection (a) to prescribe in regulations applicable with respect to the Department of Defense contracts. "(d) Assistance to Small Business Concerns. - [Amended section 15(k)(5) of the Small Business Act (15 U.S.C. 644(k)(5)).] "(e) GAO Report. - (1) The Comptroller General of the United States shall conduct an assessment of the matters described in paragraph (2) and submit a report pursuant to paragraph (3). "(2) In addition to such other related matters as the Comptroller General considers appropriate, the matters to be assessed pursuant to paragraph (1) are the following: "(A) Timely payment of progress or other periodic payments to subcontractors and suppliers by prime contractors on Federal contracts by - "(i) identifying all existing statutory and regulatory provisions, categorized by types of contracts covered by such provisions; "(ii) evaluating the feasibility and desirability of requiring that a prime contractor (other than a construction prime contractor subject to the provisions of sections 3903(b) and 3905 of title 31, United States Code) be required to - "(I) include in its subcontracts a payment term requiring payment within 7 days (or some other fixed term) after receiving payment from the Government; and "(II) submit with its payment request to the Government a certification that it has timely paid its subcontractors in accordance with their subcontracts from funds previously received as progress payments and will timely make required payments to such subcontractors from the proceeds of the progress payment covered by the certification; "(iii) evaluating the feasibility and desirability of requiring that all prime contractors (other than a construction prime contractor subject to the provisions of sections 3903(b) and 3905 of title 31, United States Code) furnish with its payment request to the Government proof of payment of the amounts included in such payment request for payments made to subcontractors and suppliers; "(iv) evaluating the feasibility and desirability of requiring a prime contractor to establish an escrow account at a federally insured financial institution and requiring direct disbursements to subcontractors and suppliers of amounts certified by the prime contractor in its payment request to the Government as being payable to such subcontractors and suppliers in accordance with their subcontracts; and "(v) evaluating the feasibility and desirability of requiring direct disbursement of amounts certified by a prime contractor as being payable to its subcontractors and suppliers in accordance with their subcontracts (using techniques such as joint payee checks, escrow accounts, or direct payment by the Government), if the contracting officer has determined that the prime contractor is failing to make timely payments to its subcontractors and suppliers. "(B) Payment protection of subcontractors and suppliers through the use of payment bonds or alternatives methods by - "(i) evaluating the effectiveness of the modifications to part 28.2 of the Federal Acquisition Regulation Part 28.2 (48 C.F.R. 28.200) relating to the use of individual sureties, which became effective February 26, 1990; "(ii) evaluating the effectiveness of requiring payment bonds pursuant to the Miller Act as a means of affording protection to construction subcontractors and suppliers relating to receiving - "(I) timely payment of progress payments due in accordance with their subcontracts; and "(II) ultimate payment of such amounts due; "(iii) evaluating the feasibility and desirability of increasing the payment bond amounts required under the Miller Act from the current maximum amounts to an amount equal to 100 percent of the amount of the contract; "(iv) evaluating the feasibility and desirability of requiring payment bonds for supply and services contracts (other than construction), and, if feasible and desirable, the amounts of such bonds; and "(v) evaluating the feasibility and desirability of using letters of credit issued by federally insured financial institutions (or other alternatives) as substitutes for payment bonds in providing payment protection to subcontractors and suppliers on construction contracts (and other contracts). "(C) Any evaluation of feasibility and desirability carried out pursuant to subparagraph (A) or (B) shall include the appropriateness of - "(i) any differential treatment of, or impact on, small business concerns as opposed to concerns other than small business concerns; "(ii) any differential treatment of subcontracts relating to commercial products entered into by the contractor in furtherance of its non-Government business, especially those subcontracts entered into prior to the award of a contract by the Government; and "(iii) extending the protections regarding payment to all tiers of subcontractors or restricting them to first-tier subcontractors and direct suppliers. "(3) The report required by paragraph (1) shall include a description of the results of the assessment carried out pursuant to paragraph (2) and may include recommendations pertaining to any of the following: "(A) Statutory and regulatory changes providing payment protections for subcontractors and suppliers (other than a construction prime contractor subject to the provisions of sections 3903(b) and 3905 of title 31, United States Code) that the Comptroller General believes to be desirable and feasible. "(B) Proposals to assess the desirability and utility of a specific payment protection on a test basis. "(C) Such other recommendations as the Comptroller General considers appropriate in light of the matters assessed pursuant to paragraph (2). "(4) The report required by paragraph (1) shall be submitted not later than by February 1, 1993, to the Committees on Armed Services and on Small Business [now the Committee on Small Business and Entrepreneurship of the Senate] of the Senate and House of Representatives. "(f) Inspector General Report. - (1) The Inspector General of the Department of Defense shall submit to the Secretary of Defense a report on payment protections for subcontractors and suppliers under contracts entered into with the Department of Defense. The report shall include an assessment of the extent to which available judicial and administrative remedies, as well as suspension and debarment procedures, have been used (or recommended for use) by officials of the Department to deter false statements relating to (A) payment bonds provided by individuals pursuant to the Miller Act, and (B) certifications pertaining to payment requests by construction contractors pursuant to section 3903(b) of title 31, United States Code. The assessment shall cover actions taken during the period beginning on October 1, 1989, and ending on September 30, 1992. "(2) The report required by paragraph (1) shall be submitted to the Secretary of Defense not later than March 1, 1993. The report may include recommendations by the Inspector General on ways to improve the effectiveness of existing methods of preventing false statements. "(g) Miller Act Defined. - For purposes of this section, the term 'Miller Act' means the Act of August 24, 1935 (40 U.S.C. 270a-270d) [now 40 U.S.C. 3131, 3133]." ADVISORY PANEL ON STREAMLINING AND CODIFYING ACQUISITION LAWS Pub. L. 101-510, div. A, title VIII, Sec. 800, Nov. 5, 1990, 104 Stat. 1587, as amended by Pub. L. 103-160, div. A, title IX, Sec. 904(f), Nov. 30, 1993, 107 Stat. 1729, directed Under Secretary of Defense for Acquisition and Technology, not later than Jan. 15, 1991, to establish under sponsorship of Defense Systems Management College an advisory panel on streamlining and codifying acquisition laws, to review the acquisition laws applicable to Department of Defense with a view toward streamlining the defense acquisition process, to make any recommendations for repeal or amendment of such laws that the panel considers necessary, as a result of such review, and to prepare a proposed code of relevant acquisition laws, directed the advisory panel, not later than Dec. 15, 1992, to transmit a final report on the actions of the panel to the Under Secretary of Defense for Acquisition and Technology, and directed the Secretary of Defense, not later than Jan. 15, 1993, to transmit the final report, together with such comments as he deems appropriate, to Congress. MENTOR-PROTEGE PILOT PROGRAM Pub. L. 106-65, div. A, title VIII, Sec. 811(d)(2), (3), Oct. 5, 1999, 113 Stat. 708, 709, as amended by Pub. L. 107-107, div. A, title X, Sec. 1048(g)(5), Dec. 28, 2001, 115 Stat. 1228, directed the Secretary of Defense to conduct a review of the Mentor-Protege Program established in Pub. L. 101-510, Sec. 831, set out below, to assess the feasibility of transitioning such program to operation without a specific appropriation or authority to provide reimbursement to a mentor firm and to assess additional incentives that could be extended to mentor firms to ensure adequate support and participation in the Program, directed the Secretary to submit to committees of Congress a report on the results of the review and recommendations not later than Sept. 30, 2000, and directed the Comptroller General to conduct a study on the implementation of the Program and the extent to which the Program was achieving its purposes in a cost-effective manner and to submit to committees of Congress a report on the results of the study not later than Jan. 1, 2002. Pub. L. 102-484, div. A, title VIII, Sec. 807(a), Oct. 23, 1992, 106 Stat. 2448, directed the Secretary of Defense, within 15 days after Oct. 23, 1992, to publish in the Department of Defense Supplement to the Federal Acquisition Regulation the Department of Defense policy for the pilot Mentor-Protege Program and the regulations, directives, and administrative guidance pertaining to such program as such policy, regulations, directives, and administrative guidance had existed on Dec. 6, 1991, and directed that proposed modifications to that policy and any amendments proposed in order to implement any of the amendments made by this section, amending Pub. L. 101-510, Sec. 831, set out below, were to be published in final form within 120 days after Oct. 23, 1992. Pub. L. 101-510, div. A, title VIII, Sec. 831, Nov. 5, 1990, 104 Stat. 1607, as amended by Pub. L. 102-25, title VII, Sec. 704(c), Apr. 6, 1991, 105 Stat. 119; Pub. L. 102-172, title VIII, Sec. 8064A, Nov. 26, 1991, 105 Stat. 1186; Pub. L. 102-190, div. A, title VIII, Sec. 814(b), Dec. 5, 1991, 105 Stat. 1425; Pub. L. 102- 484, div. A, title VIII, Secs. 801(h)(4), 807(b)(1), title X, Sec. 1054(d), Oct. 23, 1992, 106 Stat. 2445, 2448, 2503; Pub. L. 103- 160, div. A, title VIII, Sec. 813(b)(1), (c), Nov. 30, 1993, 107 Stat. 1703; Pub. L. 104-106, div. A, title VIII, Sec. 824, Feb. 10, 1996, 110 Stat. 399; Pub. L. 104-201, div. A, title VIII, Sec. 802, Sept. 23, 1996, 110 Stat. 2604; Pub. L. 105-85, div. A, title VIII, Sec. 821(a), title X, Sec. 1073(c)(6), Nov. 18, 1997, 111 Stat. 1840, 1904; Pub. L. 106-65, div. A, title VIII, Sec. 811(a)-(d)(1), (e), Oct. 5, 1999, 113 Stat. 706, 707, 709; Pub. L. 106-398, Sec. 1 [[div. A], title VIII, Sec. 807], Oct. 30, 2000, 114 Stat. 1654, 1654A-208; Pub. L. 107-107, div. A, title VIII, Sec. 812, Dec. 28, 2001, 115 Stat. 1181; Pub. L. 108-375, div. A, title VIII, Secs. 841(a), (b), 842, Oct. 28, 2004, 118 Stat. 2018, 2019; Pub. L. 112- 10, div. A, title VIII, Sec. 8016, Apr. 15, 2011, 125 Stat. 60; Pub. L. 112-81, div. A, title VIII, Sec. 867, title X, Sec. 1062(n), Dec. 31, 2011, 125 Stat. 1526, 1586, provided that: "(a) Establishment of Pilot Program. - The Secretary of Defense shall establish a pilot program to be known as the 'Mentor-Protege Program'. "(b) Purpose. - The purpose of the program is to provide incentives for major Department of Defense contractors to furnish disadvantaged small business concerns with assistance designed to enhance the capabilities of disadvantaged small business concerns to perform as subcontractors and suppliers under Department of Defense contracts and other contracts and subcontracts in order to increase the participation of such business concerns as subcontractors and suppliers under Department of Defense contracts, other Federal Government contracts, and commercial contracts. "(c) Program Participants. - (1) A business concern meeting the eligibility requirements set out in subsection (d) may enter into agreements under subsection (e) and furnish assistance to disadvantaged small business concerns upon making application to the Secretary of Defense and being approved for participation in the pilot program by the Secretary. A business concern participating in the pilot program pursuant to such an approval shall be known, for the purposes of the program, as a 'mentor firm'. "(2) A disadvantaged small business concern eligible for the award of Federal contracts may obtain assistance from a mentor firm upon entering into an agreement with the mentor firm as provided in subsection (e). A disadvantaged small business concern may not be a party to more than one agreement to receive such assistance at any time. A disadvantaged small business concern receiving such assistance shall be known, for the purposes of the program, as a 'protege firm'. "(3) In entering into an agreement pursuant to subsection (e), a mentor firm may rely in good faith on a written representation of a business concern that such business concern is a disadvantaged small business concern. The Small Business Administration shall determine the status of such business concern as a disadvantaged small business concern in the event of a protest regarding the status of such business concern. If at any time the business concern is determined by the Small Business Administration not to be a disadvantaged small business concern, assistance furnished such business concern by the mentor firm after the date of the determination may not be considered assistance furnished under the program. "(d) Mentor Firm Eligibility. - Subject to subsection (c)(1), a mentor firm eligible for award of Federal contracts may enter into an agreement with one or more protege firms under subsection (e) and provide assistance under the program pursuant to that agreement if - "(1) during the fiscal year preceding the fiscal year in which the mentor firm enters into the agreement, the total amount of the Department of Defense contracts awarded such mentor firm and the subcontracts awarded such mentor firm under Department of Defense contracts was equal to or greater than $100,000,000; or "(2) the mentor firm demonstrates the capability to assist in the development of protege firms, and is approved by the Secretary of Defense pursuant to criteria specified in the regulations prescribed pursuant to subsection (k). "(e) Mentor-Protege Agreement. - Before providing assistance to a protege firm under the program, a mentor firm shall enter into a mentor-protege agreement with the protege firm regarding the assistance to be provided by the mentor firm. The agreement shall include the following: "(1) A developmental program for the protege firm, in such detail as may be reasonable, including (A) factors to assess the protege firm's developmental progress under the program, and (B) the anticipated number and type of subcontracts to be awarded the protege firm. "(2) A program participation term for any period of not more than three years, except that the term may be a period of up to five years if the Secretary of Defense determines in writing that unusual circumstances justify a program participation term in excess of three years. "(3) Procedures for the protege firm to terminate the agreement voluntarily and for the mentor firm to terminate the agreement for cause. "(f) Forms of Assistance. - A mentor firm may provide a protege firm the following: "(1) Assistance, by using mentor firm personnel, in - "(A) general business management, including organizational management, financial management, and personnel management, marketing, business development, and overall business planning; "(B) engineering and technical matters such as production, inventory control, and quality assurance; and "(C) any other assistance designed to develop the capabilities of the protege firm under the developmental program referred to in subsection (e). "(2) Award of subcontracts on a noncompetitive basis to the protege firm under the Department of Defense or other contracts. "(3) Payment of progress payments for performance of the protege firm under such a subcontract in amounts as provided for in the subcontract, but in no event may any such progress payment exceed 100 percent of the costs incurred by the protege firm for the performance. "(4) Advance payments under such subcontracts. "(5) Loans. "(6) Cash in exchange for an ownership interest in the protege firm, not to exceed 10 percent of the total ownership interest. "(7) Assistance obtained by the mentor firm for the protege firm from one or more of the following - "(A) small business development centers established pursuant to section 21 of the Small Business Act (15 U.S.C. 648); "(B) entities providing procurement technical assistance pursuant to chapter 142 of title 10, United States Code; or "(C) a historically Black college or university or a minority institution of higher education. "(g) Incentives for Mentor Firms. - (1) The Secretary of Defense may provide to a mentor firm reimbursement for the total amount of any progress payment or advance payment made under the program by the mentor firm to a protege firm in connection with a Department of Defense contract awarded the mentor firm. "(2)(A) The Secretary of Defense may provide to a mentor firm reimbursement for the costs of the assistance furnished to a protege firm pursuant to paragraphs (1) and (7) of subsection (f) as provided for in a line item in a Department of Defense contract under which the mentor firm is furnishing products or services to the Department, subject to a maximum amount of reimbursement specified in such contract, except that this sentence does not apply in a case in which the Secretary of Defense determines in writing that unusual circumstances justify reimbursement using a separate contract. "(B) The determinations made in annual performance reviews of a mentor firm's mentor-protege agreement under subsection (l)(2) shall be a major factor in the determinations of amounts of reimbursement, if any, that the mentor firm is eligible to receive in the remaining years of the program participation term under the agreement. "(C) The total amount reimbursed under this paragraph to a mentor firm for costs of assistance furnished in a fiscal year to a protege firm may not exceed $1,000,000, except in a case in which the Secretary of Defense determines in writing that unusual circumstances justify a reimbursement of a higher amount. "(3)(A) Costs incurred by a mentor firm in providing assistance to a protege firm that are not reimbursed pursuant to paragraph (2) shall be recognized as credit in lieu of subcontract awards for purposes of determining whether the mentor firm attains a subcontracting participation goal applicable to such mentor firm under a Department of Defense contract, under a contract with another executive agency, or under a divisional or company-wide subcontracting plan negotiated with the Department of Defense or another executive agency. "(B) The amount of the credit given a mentor firm for any such unreimbursed costs shall be equal to - "(i) four times the total amount of such costs attributable to assistance provided by entities described in subsection (f)(7); "(ii) three times the total amount of such costs attributable to assistance furnished by the mentor firm's employees; and "(iii) two times the total amount of any other such costs. "(C) Under regulations prescribed pursuant to subsection (k), the Secretary of Defense shall adjust the amount of credit given a mentor firm pursuant to subparagraphs (A) and (B) if the Secretary determines that the firm's performance regarding the award of subcontracts to disadvantaged small business concerns has declined without justifiable cause. "(4) A mentor firm shall receive credit toward the attainment of a subcontracting participation goal applicable to such mentor firm for each subcontract for a product or service awarded under such contract by a mentor firm to a business concern that, except for its size, would be a small business concern owned and controlled by socially and economically disadvantaged individuals, but only if - "(A) the size of such business concern is not more than two times the maximum size specified by the Administrator of the Small Business Administration for purposes of determining whether a business concern furnishing such product or service is a small business concern; and "(B) the business concern formerly had a mentor-protege agreement with such mentor firm that was not terminated for cause. "(h) Relationship to Small Business Act. - (1) For purposes of the Small Business Act [15 U.S.C. 631 et seq.], no determination of affiliation or control (either direct or indirect) may be found between a protege firm and its mentor firm on the basis that the mentor firm has agreed to furnish (or has furnished) to its protege firm pursuant to a mentor-protege agreement any form of developmental assistance described in subsection (f). "(2) Notwithstanding section 8 of the Small Business Act (15 U.S.C. 637), the Small Business Administration may not determine a disadvantaged small business concern to be ineligible to receive any assistance authorized under the Small Business Act on the basis that such business concern has participated in the Mentor-Protege Program or has received assistance pursuant to any developmental assistance agreement authorized under such program. "(3) The Small Business Administration may not require a firm that is entering into, or has entered into, an agreement under subsection (e) as a protege firm to submit the agreement, or any other document required by the Secretary of Defense in the administration of the Mentor-Protege Program, to the Small Business Administration for review, approval, or any other purpose. "(i) Participation in Mentor-Protege Program not To Be a Condition for Award of a Contract or Subcontract. - A mentor firm may not require a business concern to enter into an agreement with the mentor firm pursuant to subsection (e) as a condition for being awarded a contract by the mentor firm, including a subcontract under a contract awarded to the mentor firm. "(j) Expiration of Authority. - (1) No mentor-protege agreement may be entered into under subsection (e) after September 30, 2015. "(2) No reimbursement may be paid, and no credit toward the attainment of a subcontracting goal may be granted, under subsection (g) for any cost incurred after September 30, 2018. "(k) Regulations. - The Secretary of Defense shall prescribe regulations to carry out the pilot Mentor-Protege Program. Such regulations shall include the requirements set forth in section 8(d) of the Small Business Act (15 U.S.C. 637(d)) and shall prescribe procedures by which mentor firms may terminate participation in the program. The Secretary shall publish the proposed regulations not later than the date 180 days after the date of the enactment of this Act [Nov. 5, 1990]. The Secretary shall promulgate the final regulations not later than the date 270 days after the date of the enactment of this Act. The Department of Defense policy regarding the pilot Mentor-Protege Program shall be published and maintained as an appendix to the Department of Defense Supplement to the Federal Acquisition Regulation. "(l) Definitions. - In this section: "(1) The term 'small business concern' means a business concern that meets the requirements of section 3(a) of the Small Business Act (15 U.S.C. 632(a)) and the regulations promulgated pursuant thereto. "(2) The term 'disadvantaged small business concern' means: "(A) a small business concern owned and controlled by socially and economically disadvantaged individuals; "(B) a business entity owned and controlled by an Indian tribe as defined by section 8(a)(13) of the Small Business Act (15 U.S.C. 637(a)(13)); "(C) a business entity owned and controlled by a Native Hawaiian Organization as defined by section 8(a)(15) of the Small Business Act (15 U.S.C. 637(a)(15)); "(D) a qualified organization employing the severely disabled; "(E) a small business concern owned and controlled by women, as defined in section 8(d)(3)(D) of the Small Business Act (15 U.S.C. 637(d)(3)(D)); "(F) a small business concern owned and controlled by service- disabled veterans (as defined in section 8(d)(3) of the Small Business Act [15 U.S.C. 637(d)(3)]); and "(G) a qualified HUBZone small business concern (as defined in section 3(p) of the Small Business Act [15 U.S.C. 632(p)]). "(3) The term 'small business concern owned and controlled by socially and economically disadvantaged individuals' has the meaning given such term in section 8(d)(3)(C) of the Small Business Act (15 U.S.C. 637(d)(3)(C)). "(4) The term 'historically Black college and university' means any of the historically Black colleges and universities referred to in section 2323 of title 10, United States Code. "(5) The term 'minority institution of higher education' means an institution of higher education with a student body that reflects the composition specified in section 312(b)(3), (4), and (5) of the Higher Education Act of 1965 (20 U.S.C. 1058(b)(3), (4), and (5)). "(6) The term 'subcontracting participation goal', with respect to a Department of Defense contract, means a goal for the extent of the participation by disadvantaged small business concerns in the subcontracts awarded under such contract, as established pursuant to section 2323 of title 10, United States Code, and section 8(d) of the Small Business Act (15 U.S.C. 637(d)). "(7) The term 'qualified organization employing the severely disabled' means a business entity operated on a for-profit or nonprofit basis that - "(A) uses rehabilitative engineering to provide employment opportunities for severely disabled individuals and integrates severely disabled individuals into its workforce; "(B) employs severely disabled individuals at a rate that averages not less than 20 percent of its total workforce; "(C) employs each severely disabled individual in its workforce generally on the basis of 40 hours per week; and "(D) pays not less than the minimum wage prescribed pursuant to section 6 of the Fair Labor Standards Act (29 U.S.C. 206) to those employees who are severely disabled individuals. "(8) The term 'severely disabled individual' means an individual who has a physical or mental disability which constitutes a substantial handicap to employment and which, in accordance with criteria prescribed by the Committee for the Purchase From the Blind and Other Severely Handicapped established by the first section of the Act of June 25, 1938 ([former] 41 U.S.C. 46 [now 41 U.S.C. 8502]; popularly known as the 'Wagner-O'Day Act') [now known as the "Javits-Wagner-O'Day Act"; now 41 U.S.C. 8501 et seq.], is of such a nature that the individual is otherwise prevented from engaging in normal competitive employment." [Amendment by Pub. L. 112-81, Sec. 1062(n)(2), to section 831 of Pub. L. 101-510, set out above, was executed to reflect the probable intent of Congress, notwithstanding an error in the directory language.] [Pub. L. 112-81, Sec. 867, which directed amendment of section 831 of Pub. L. 101-510, set out above, by substituting "September 30, 2015" for "September 30, 2010" in subsec. (j)(1) and "September 30, 2018" for "September 30, 2013" in subsec. (j)(2), was executed by making the substitutions for "September 30, 2011" in subsec. (j)(1) and "September 30, 2014" in subsec. (j)(2) to reflect the probable intent of Congress and the amendments by Pub. L. 112-10, Sec. 8016.] [Pub. L. 106-65, div. A, title VIII, Sec. 811(f), Oct. 5, 1999, 113 Stat. 709, provided that: ["(1) The amendments made by this section [amending section 831 of Pub. L. 101-510, set out above] shall take effect on October 1, 1999, and shall apply with respect to mentor-protege agreements that are entered into under section 831(e) of the National Defense Authorization Act for Fiscal Year 1991 [Pub. L. 101-510, set out above] on or after that date. ["(2) Section 831 of the National Defense Authorization Act for Fiscal Year 1991, as in effect on September 30, 1999, shall continue to apply with respect to mentor-protege agreements entered into before October 1, 1999."] [Section 807(b)(2) of Pub. L. 102-484 provided that: "The amendment made by this subsection [amending section 831 of Pub. L. 101-510, set out above] shall take effect as of November 5, 1990."] CREDIT FOR INDIAN CONTRACTING IN MEETING CERTAIN MINORITY SUBCONTRACTING GOALS Pub. L. 101-189, div. A, title VIII, Sec. 832, Nov. 29, 1989, 103 Stat. 1508, which provided credit for Indian contracting in meeting certain minority contracting goals, was repealed and restated in section 2323a of this title by Pub. L. 102-484, Sec. 801(g)(1)(B), (h)(5). EQUITABLE PARTICIPATION OF AMERICAN SMALL AND MINORITY-OWNED BUSINESS IN FURNISHING OF COMMODITIES AND SERVICES Pub. L. 101-165, title IX, Sec. 9004, Nov. 21, 1989, 103 Stat. 1129, provided that: "During the current fiscal year and hereafter, the Secretary of Defense and each purchasing and contracting agency of the Department of Defense shall assist American small and minority-owned business to participate equitably in the furnishing of commodities and services financed with funds appropriated under this Act [see Tables for classification] by increasing, to an optimum level, the resources and number of personnel jointly assigned to promoting both small and minority business involvement in purchases financed with funds appropriated herein, and by making available or causing to be made available to such businesses, information, as far in advance as possible, with respect to purchases proposed to be financed with funds appropriated under this Act, and by assisting small and minority business concerns to participate equitably as subcontractors on contracts financed with funds appropriated herein, and by otherwise advocating and providing small and minority business opportunities to participate in the furnishing of commodities and services financed with funds appropriated by this Act." REQUIREMENT FOR SUBSTANTIAL PROGRESS ON MINORITY AND SMALL BUSINESS CONTRACT AWARDS Pub. L. 100-180, div. A, title VIII, Sec. 806(a)-(c), Dec. 4, 1987, 101 Stat. 1126, 1127, directed Secretary of Defense to issue regulations to ensure that substantial progress was made in increasing awards of Department of Defense contracts to small business concerns, historically Black colleges and universities, and minority institutions described in section 1207(a) of Pub. L. 99-661 [formerly set out below], prior to repeal by Pub. L. 102- 484, div. A, title VIII, Sec. 801(h)(7), Oct. 23, 1992, 106 Stat. 2446. DEFINITIONS; RULE OF CONSTRUCTION FOR DUPLICATE AUTHORIZATION AND APPROPRIATION PROVISIONS OF PUBLIC LAWS 99-500, 99-591, AND 99-661 Pub. L. 100-26, Secs. 2, 6, Apr. 21, 1987, 101 Stat. 273, 274, provided that: "SEC. 2. REFERENCES TO 99TH CONGRESS LAWS "For purposes of this Act [Pub. L. 100-26, see Short Title of 1987 Amendment note set out under section 101 of this title]: "(1) The term 'Defense Authorization Act' means the Department of Defense Authorization Act, 1987 (division A of Public Law 99- 661; 100 Stat. 3816 et seq.). "(2) The term 'Defense Appropriations Act' means the Department of Defense Appropriations Act, 1987 (as contained in identical form in section 101(c) of Public Law 99-500 (100 Stat. 1783-82 et seq.) and section 101(c) of Public Law 99-591 (100 Stat. 3341-82 et seq.)). "(3) The term 'Defense Acquisition Improvement Act' means title X of the Defense Appropriations Act [100 Stat. 1783-130, 3341- 130] and title IX of the Defense Authorization Act [100 Stat. 3910] (as designated by the amendment made by section 3(5) [section 3(5) of Pub. L. 100-26]). Any reference in this Act to the Defense Acquisition Improvement Act shall be considered to be a reference to each such title." "SEC. 6. CONSTRUCTION OF DUPLICATE AUTHORIZATION AND APPROPRIATION PROVISIONS "(a) Rule for Construction of Duplicate Provisions. - (1) In applying the provisions of Public Laws 99-500, 99-591, and 99-661 described in paragraph (2) - "(A) the identical provisions of those public laws referred to in such paragraph shall be treated as having been enacted only once, and "(B) in executing to the United States Code and other statutes of the United States the amendments made by such identical provisions, such amendments shall be executed so as to appear only once in the law as amended. "(2) Paragraph (1) applies with respect to the provisions of the Defense Appropriations Act and the Defense Authorization Act (as amended by sections 3, 4, 5, and 10(a)) referred to across from each other in the following table: "Section 101(c) of Section 101(c) of Division A of Public Law 99-500 Public Law 99-591 Public Law 99-661 -------------------------------------------------------------------- "Title X Title X Title IX "Sec. 9122 Sec. 9122 Sec. 522 "Sec. 9036(b) Sec. 9036(b) Sec. 1203 "Sec. 9115 Sec. 9115 Sec. 1311 -------------------------------------------------------------------- "(b) Rule for Date of Enactment. - (1) The date of the enactment of the provisions of law listed in the middle column, and in the right-hand column, of the table in subsection (a)(2) shall be deemed to be October 18, 1986 (the date of the enactment of Public Law 99-500). "(2) Any reference in a provision of law referred to in paragraph (1) to 'the date of the enactment of this Act' shall be treated as a reference to October 18, 1986." [For classification of provisions listed in the table, see Tables.] CONTRACT GOAL FOR MINORITIES Section 1207 of Pub. L. 99-661, as amended by Pub. L. 100-180, div. A, title VIII, Sec. 806(d), 101 Stat. 1127; Pub. L. 100-456, div. A, title VIII, Sec. 844, Sept. 29, 1988, 102 Stat. 2027; Pub. L. 101-189, div. A, title VIII, Sec. 831, Nov. 29, 1989, 103 Stat. 1507; Pub. L. 101-510, div. A, title VIII, Secs. 811, 832, title XIII, Secs. 1302(d), 1312(b), Nov. 5, 1990, 104 Stat. 1596, 1612, 1669, 1670; Pub. L. 102-25, title VII, Secs. 704(a)(6), 705(e), Apr. 6, 1991, 105 Stat. 118, 120, which set contract goals for small disadvantaged businesses and certain institutions of higher education, was repealed and restated in section 2323 of this title by Pub. L. 102-484, Sec. 801(a)(1)(B), (h)(1). MINIMUM PERCENTAGE OF COMPETITIVE PROCUREMENTS Pub. L. 99-145, title IX, Sec. 913, Nov. 8, 1985, 99 Stat. 687, as amended by Pub. L. 101-510, div. A, title XIII, Sec. 1322(d)(1), Nov. 5, 1990, 104 Stat. 1672, provided that: "(a) Annual Goal. - The Secretary of Defense shall establish for each fiscal year a goal for the percentage of defense procurements to be made during that year (expressed in total dollar value of contracts entered into) that are to be competitive procurements. "(b) Definition. - For the purposes of this section, the term 'competitive procurements' means procurements made by the Department of Defense through the use of competitive procedures, as defined in section 2304 of title 10, United States Code." DEFENSE PROCUREMENT REFORM: CONGRESSIONAL FINDINGS AND POLICY Section 1202 of Pub. L. 98-525, as amended by Pub. L. 99-500, Sec. 101(c) [title X, Sec. 953(c)], Oct. 18, 1986, 100 Stat. 1783- 82, 1783-172, and Pub. L. 99-591, Sec. 101(c) [title X, Sec. 953(c)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-172; Pub. L. 99- 661, div. A, title IX, formerly title IV, Sec. 953(c), Nov. 14, 1986, 100 Stat. 3952, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, provided that: "The Congress finds that recent disclosures of excessive payments by the Department of Defense for replenishment parts have undermined confidence by the public and Congress in the defense procurement system. The Secretary of Defense should make every effort to reform procurement practices relating to replenishment parts. Such efforts should, among other matters, be directed to the elimination of excessive pricing of replenishment spare parts and the recovery of unjustified payments. Specifically, the Secretary should - "(1) direct that officials in the Department of Defense refuse to enter into contracts unless the proposed prices are fair and reasonable; "(2) continue and accelerate ongoing efforts to improve defense contracting procedures in order to encourage effective competition and assure fair and reasonable prices; "(3) direct that replenishment parts be acquired in economic order quantities and on a multiyear basis whenever feasible, practicable, and cost effective; "(4) direct that standard or commercial parts be used whenever such use is technically acceptable and cost effective; and "(5) vigorously continue reexamination of policies relating to acquisition, pricing, and management of replenishment parts and of technical data related to such parts." MODIFICATION OF REGULATIONS AND DIRECTIVES TO ACCOMMODATE A POLICY OF MULTIYEAR PROCUREMENT Section 909(d) of Pub. L. 97-86 directed Secretary of Defense, not later than the end of the 90-day period beginning Dec. 1, 1981, to issue such modifications to existing regulations governing defense acquisitions as might be necessary to implement the amendments made by subsections (a), (b), and (c) [amending sections 139, 2301, and 2306 of this title] and directed Director of the Office of Management and Budget to issue such modifications to existing Office of Management and Budget directives as might be necessary to take into account the amendments made by subsections (a) and (b) [amending sections 2301 and 2306 of this title]. PROCUREMENT REQUIREMENTS FOR GOODS WHICH ARE NOT AMERICAN GOODS Pub. L. 93-365, title VII, Sec. 707, Aug. 5, 1974, 88 Stat. 406, which prohibited contracts by the Department of Defense for other than American goods after Aug. 5, 1974, unless adequate consideration was first given to bids of firms in labor surplus areas of the United States, of small business firms, and of all other United States firms which had offered to furnish American goods, balance of payments, cost of shipping other than American goods, and any duty, tariff, or surcharge on such goods, was repealed and restated in section 2501 of this title by Pub. L. 100- 370, Sec. 3(a), (c). Section 2501 of this title was renumbered section 2506 by Pub. L. 100-456, Sec. 821(b)(1)(A). Section 2506 of this title was renumbered section 2533 by Pub. L. 102-484, Sec. 4202(a). -FOOTNOTE- (!1) See References in Text note below. -End- -CITE- 10 USC Sec. 2302a 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2302a. Simplified acquisition threshold -STATUTE- (a) Simplified Acquisition Threshold. - For purposes of acquisitions by agencies named in section 2303 of this title, the simplified acquisition threshold is as specified in section 134 of title 41. (b) Inapplicable Laws. - No law properly listed in the Federal Acquisition Regulation pursuant to section 1905 of title 41 shall apply to or with respect to a contract or subcontract that is not greater than the simplified acquisition threshold. -SOURCE- (Added and amended Pub. L. 103-355, title IV, Secs. 4002(a), 4102(a), Oct. 13, 1994, 108 Stat. 3338, 3340; Pub. L. 111-350, Sec. 5(b)(9), Jan. 4, 2011, 124 Stat. 3843.) -MISC1- AMENDMENTS 2011 - Subsec. (a). Pub. L. 111-350, Sec. 5(b)(9)(A), substituted "section 134 of title 41" for "section 4(11) of the Office of Federal Procurement Policy Act". Subsec. (b). Pub. L. 111-350, Sec. 5(b)(9)(B), substituted "section 1905 of title 41" for "section 33 of the Office of Federal Procurement Policy Act". 1994 - Subsec. (b). Pub. L. 103-355, Sec. 4102(a), added subsec. (b). EFFECTIVE DATE For effective date and applicability of section, see section 10001 of Pub. L. 103-355, set out as an Effective Date of 1994 Amendment note under section 2302 of this title. -End- -CITE- 10 USC Sec. 2302b 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2302b. Implementation of simplified acquisition procedures -STATUTE- The simplified acquisition procedures contained in the Federal Acquisition Regulation pursuant to section 1901 of title 41 shall apply as provided in such section to the agencies named in section 2303(a) of this title. -SOURCE- (Added Pub. L. 103-355, title IV, Sec. 4203(a)(1), Oct. 13, 1994, 108 Stat. 3345; amended Pub. L. 111-350, Sec. 5(b)(10), Jan. 4, 2011, 124 Stat. 3843.) -MISC1- AMENDMENTS 2011 - Pub. L. 111-350 substituted "section 1901 of title 41" for "section 31 of the Office of Federal Procurement Policy Act". EFFECTIVE DATE For effective date and applicability of section, see section 10001 of Pub. L. 103-355, set out as an Effective Date of 1994 Amendment note under section 2302 of this title. -End- -CITE- 10 USC Sec. 2302c 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2302c. Implementation of electronic commerce capability -STATUTE- (a) Implementation of Electronic Commerce Capability. - (1) The head of each agency named in paragraphs (1), (5), and (6) of section 2303(a) of this title shall implement the electronic commerce capability required by section 2301 of title 41. (2) The Secretary of Defense shall act through the Under Secretary of Defense for Acquisition, Technology, and Logistics to implement the capability within the Department of Defense. (3) In implementing the electronic commerce capability pursuant to paragraph (1), the head of an agency referred to in paragraph (1) shall consult with the Administrator for Federal Procurement Policy. (b) Designation of Agency Official. - The head of each agency named in paragraph (5) or (6) of section 2303(a) of this title shall designate a program manager to implement the electronic commerce capability for that agency. The program manager shall report directly to an official at a level not lower than the senior procurement executive designated for the agency under section 1702(c) of title 41. -SOURCE- (Added Pub. L. 103-355, title IX, Sec. 9002(a), Oct. 13, 1994, 108 Stat. 3402; amended Pub. L. 105-85, div. A, title VIII, Sec. 850(f)(3)(A), Nov. 18, 1997, 111 Stat. 1850; Pub. L. 105-129, Sec. 1(a)(1), Dec. 1, 1997, 111 Stat. 2551; Pub. L. 106-65, div. A, title X, Sec. 1066(a)(18), Oct. 5, 1999, 113 Stat. 771; Pub. L. 107- 107, div. A, title X, Sec. 1048(b)(2), Dec. 28, 2001, 115 Stat. 1225; Pub. L. 109-364, div. A, title X, Sec. 1071(a)(2), Oct. 17, 2006, 120 Stat. 2398; Pub. L. 111-350, Sec. 5(b)(11), Jan. 4, 2011, 124 Stat. 3843.) -MISC1- AMENDMENTS 2011 - Subsec. (a)(1). Pub. L. 111-350, Sec. 5(b)(11)(A), substituted "section 2301 of title 41" for "section 30 of the Office of Federal Procurement Policy Act (41 U.S.C. 426)". Subsec. (b). Pub. L. 111-350, Sec. 5(b)(11)(B), substituted "section 1702(c) of title 41" for "section 16(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 414(c))". 2006 - Subsec. (b). Pub. L. 109-364 substituted "section 16(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 414(c))" for "section 16(3) of the Office of Federal Procurement Policy Act (41 U.S.C. 414(3))". 2001 - Subsec. (a)(2). Pub. L. 107-107 substituted "Under Secretary of Defense for Acquisition, Technology, and Logistics" for "Under Secretary of Defense for Acquisition and Technology". 1999 - Subsec. (b). Pub. L. 106-65 substituted "section 2303(a)" for "section 2303". 1997 - Pub. L. 105-85 substituted "electronic commerce" for "FACNET" in section catchline and amended text generally. Prior to amendment, text read as follows: "(a) Implementation of FACNET Capability. - (1) The head of each agency named in section 2303 of this title shall implement the Federal acquisition computer network ('FACNET') capability required by section 30 of the Office of Federal Procurement Policy Act. In the case of the Department of Defense, the implementation shall be by the Secretary of Defense, acting through the Under Secretary of Defense for Acquisition and Technology, for the Department of Defense as a whole. For purposes of this section, the term 'head of an agency' does not include the Secretaries of the military departments. "(2) In implementing the FACNET capability pursuant to paragraph (1), the head of an agency shall consult with the Administrator for Federal Procurement Policy. "(b) Designation of Agency Official. - The head of each agency named in paragraph (5) or (6) of section 2303 of this title shall designate a program manager to have responsibility for implementation of FACNET capability for that agency and otherwise to implement this section. Such program manager shall report directly to the senior procurement executive designated for the agency under section 16(3) of the Office of Federal Procurement Policy Act (41 U.S.C. 414(3))." Subsec. (a)(1). Pub. L. 105-129 inserted "of section 2303(a) of this title" after "paragraphs (1), (5), and (6)". EFFECTIVE DATE OF 1997 AMENDMENTS Section 1(a)(2) of Pub. L. 105-129 provided that: "The amendment made by paragraph (1) [amending this section] shall take effect as if included in the amendment to section 2302c of title 10, United States Code, made by section 850(f)(3)(A) of the National Defense Authorization Act for Fiscal Year 1998 [Pub. L. 105-85] to which the amendment made by paragraph (1) relates." Section 850(g) of Pub. L. 105-85 provided that: "(1) Except as provided in paragraph (2), the amendments made by this section [amending this section, section 2304 of this title, section 637 of Title 15, Commerce and Trade, section 1501 of former Title 40, Public Buildings, Property, and Works, and sections 252c, 253, 416, 426, and 427 of Title 41, Public Contracts, repealing section 426a of Title 41, amending provisions set out as a note under section 413 of Title 41, and repealing provisions set out as a note under section 426a of Title 41] shall take effect 180 days after the date of the enactment of this Act [Nov. 18, 1997]. "(2) The repeal made by subsection (c) of this section [repealing provisions set out as a note under section 426a of Title 41] shall take effect on the date of the enactment of this Act." EFFECTIVE DATE Pub. L. 103-355, title IX, Sec. 9002(c), Oct. 13, 1994, 108 Stat. 3402, provided that: "A FACNET capability may be implemented and used in an agency before the promulgation of regulations implementing this section (as provided in section 10002) [108 Stat. 3404, formerly set out as a Regulations note under section 251 of former Title 41, Public Contracts]. If such implementation and use occurs, the period for submission of bids or proposals under section 18(a)(3)(B) of the Office of Federal Procurement Policy Act [now 41 U.S.C. 1708(e)(1)(B)], in the case of a solicitation through FACNET, may be less than the period otherwise applicable under that section, but shall be at least 10 days. The preceding sentence shall not be in effect after September 30, 1995." -End- -CITE- 10 USC Sec. 2302d 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2302d. Major system: definitional threshold amounts -STATUTE- (a) Department of Defense Systems. - For purposes of section 2302(5) of this title, a system for which the Department of Defense is responsible shall be considered a major system if - (1) the total expenditures for research, development, test, and evaluation for the system are estimated to be more than $115,000,000 (based on fiscal year 1990 constant dollars); or (2) the eventual total expenditure for procurement for the system is estimated to be more than $540,000,000 (based on fiscal year 1990 constant dollars). (b) Civilian Agency Systems. - For purposes of section 2302(5) of this title, a system for which a civilian agency is responsible shall be considered a major system if total expenditures for the system are estimated to exceed the greater of - (1) $750,000 (based on fiscal year 1980 constant dollars); or (2) the dollar threshold for a "major system" established by the agency pursuant to Office of Management and Budget (OMB) Circular A-109, entitled "Major Systems Acquisitions". (c) Adjustment Authority. - (1) The Secretary of Defense may adjust the amounts and the base fiscal year provided in subsection (a) on the basis of Department of Defense escalation rates. (2) An amount, as adjusted under paragraph (1), that is not evenly divisible by $5,000,000 shall be rounded to the nearest multiple of $5,000,000. In the case of an amount that is evenly divisible by $2,500,000 but not evenly divisible by $5,000,000, the amount shall be rounded to the next higher multiple of $5,000,000. (3) An adjustment under this subsection shall be effective after the Secretary transmits to the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives a written notification of the adjustment. -SOURCE- (Added Pub. L. 104-201, div. A, title VIII, Sec. 805(a)(2), Sept. 23, 1996, 110 Stat. 2605; amended Pub. L. 105-85, div. A, title X, Sec. 1073(a)(41), Nov. 18, 1997, 111 Stat. 1902; Pub. L. 106-65, div. A, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774.) -MISC1- AMENDMENTS 1999 - Subsec. (c)(3). Pub. L. 106-65 substituted "and the Committee on Armed Services" for "and the Committee on National Security". 1997 - Subsec. (a)(2). Pub. L. 105-85 substituted "procurement for the system is estimated to be" for "procurement of". -End- -CITE- 10 USC Sec. 2303 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2303. Applicability of chapter -STATUTE- (a) This chapter applies to the procurement by any of the following agencies, for its use or otherwise, of all property (other than land) and all services for which payment is to be made from appropriated funds: (1) The Department of Defense. (2) The Department of the Army. (3) The Department of the Navy. (4) The Department of the Air Force. (5) The Coast Guard. (6) The National Aeronautics and Space Administration. (b) The provisions of this chapter that apply to the procurement of property apply also to contracts for its installation or alteration. -SOURCE- (Aug. 10, 1956, ch. 1041, 70A Stat. 128; Pub. L. 85-568, title III, Sec. 301(b), July 29, 1958, 72 Stat. 432; Pub. L. 98-369, div. B, title VII, Sec. 2722(b), July 18, 1984, 98 Stat. 1187.) -MISC1- HISTORICAL AND REVISION NOTES -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2303(a) 41:151(a). Feb. 19, 1948, ch. 65, Secs. 2(a), 9 (clause (b)), 62 Stat. 21, 24. 2303(b) 41:158 (clause (b), less last 5 words). 2303(c) 41:158 (last 5 words of clause (b)). -------------------------------------------------------------------- In subsection (a), the words "all property named in subsection (b), and all services" are substituted for the words "for supplies or services". The words "(each being hereinafter called the agency)", are omitted, since the revised sections of this chapter make specific reference to the agencies named in this revised section. The words "United States" before the words "Coast Guard" are omitted, since they are not a part of the official name of the Coast Guard under section 1 of title 14. In subsection (b), the introductory clause is substituted for the word "supplies". Throughout the revised chapter reference is made to "property or services covered by this chapter", instead of "supplies", since the word "supplies" is defined in section 101(26) of this title in its usual and narrower sense, rather than the sense of the source statute for this revised chapter. It is desirable to avoid a usage which conflicts with the definition in section 101(26) of this title. The word "ships" and the words "of every character, type, and description", after the word "vessels", are omitted as covered by the definition of "vessel" in section 1 of title 1. AMENDMENTS 1984 - Subsec. (a). Pub. L. 98-369, Sec. 2722(b)(1)(A), (B), substituted in provisions preceding cl. (1) "procurement" for "purchase, and contract to purchase," and "(other than land) and all services" for "named in subsection (b), and all services,". Subsec. (a)(1) to (6). Pub. L. 98-369, Sec. 2722(b)(1)(C), (D), added cl. (1) and redesignated existing cls. (1) to (5) as (2) to (6), respectively. Subsecs. (b), (c). Pub. L. 98-369, Sec. 2722(b)(2), (3), redesignated subsec. (c) as (b). Former subsec. (b), which had provided that this chapter did not cover land but did cover public works, buildings, facilities, vessels, floating equipment, aircraft, parts, accessories, equipment, and machine tools, was struck out. 1958 - Subsec. (a)(5). Pub. L. 85-568 substituted "The National Aeronautics and Space Administration" for "The National Advisory Committee for Aeronautics". EFFECTIVE DATE OF 1984 AMENDMENT Amendment by Pub. L. 98-369 applicable with respect to any solicitation for bids or proposals issued after Mar. 31, 1985, see section 2751 of Pub. L. 98-369, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1958 AMENDMENT Amendment by Pub. L. 85-568 effective 90 days after July 29, 1958, or on any earlier date on which the Administrator of the National Aeronautics and Space Administration determines, and announces by proclamation, that the Administration has been organized and is prepared to discharge the duties and exercise the powers conferred upon it, see note set out under section 2302 of this title. -TRANS- TRANSFER OF FUNCTIONS For transfer of authorities, functions, personnel, and assets of the Coast Guard, including the authorities and functions of the Secretary of Transportation relating thereto, to the Department of Homeland Security, and for treatment of related references, see sections 468(b), 551(d), 552(d), and 557 of Title 6, Domestic Security, and the Department of Homeland Security Reorganization Plan of November 25, 2002, as modified, set out as a note under section 542 of Title 6. -MISC2- ACQUISITION, LEASE, OR RENTAL FOR USE BY THE ARMED FORCES OF MOTOR BUSES MANUFACTURED OUTSIDE THE UNITED STATES Pub. L. 90-500, title IV, Sec. 404, Sept. 20, 1968, 82 Stat. 851, which provided that no funds for the armed forces were to be used to buy or lease buses other than those manufactured in the United States, except as regulation from the Secretary of Defense might authorize solely to avoid uneconomical procurement or one contrary to the national interest, was repealed and restated as section 2400 of this title by Pub. L. 97-295, Secs. 1(29)(A), 6(b), Oct. 12, 1982, 96 Stat. 1294, 1314. -End- -CITE- 10 USC Sec. 2303a 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2303a. Repealed. -MISC1- [Sec. 2303a. Repealed. Pub. L. 98-577, title III, Sec. 302(c)(1), Oct. 30, 1984, 98 Stat. 3077]. Section, Pub. L. 98-525, title XII, Sec. 1212(a), Oct. 19, 1984, 98 Stat. 2590, related to publication of proposed regulations. Section, pursuant to section 1212(b) of Pub. L. 98-525, was to have taken effect with respect to procurement policies, regulations, procedures, or forms first proposed to be issued by an agency on or after the date which was 30 days after the date of enactment of Pub. L. 98-525. Pub. L. 98-525 was approved Oct. 19, 1984. However, before that effective date, the section was repealed by Pub. L. 98-577. -End- -CITE- 10 USC Sec. 2304 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2304. Contracts: competition requirements -STATUTE- (a)(1) Except as provided in subsections (b), (c), and (g) and except in the case of procurement procedures otherwise expressly authorized by statute, the head of an agency in conducting a procurement for property or services - (A) shall obtain full and open competition through the use of competitive procedures in accordance with the requirements of this chapter and the Federal Acquisition Regulation; and (B) shall use the competitive procedure or combination of competitive procedures that is best suited under the circumstances of the procurement. (2) In determining the competitive procedure appropriate under the circumstances, the head of an agency - (A) shall solicit sealed bids if - (i) time permits the solicitation, submission, and evaluation of sealed bids; (ii) the award will be made on the basis of price and other price-related factors; (iii) it is not necessary to conduct discussions with the responding sources about their bids; and (iv) there is a reasonable expectation of receiving more than one sealed bid; and (B) shall request competitive proposals if sealed bids are not appropriate under clause (A). (b)(1) The head of an agency may provide for the procurement of property or services covered by this chapter using competitive procedures but excluding a particular source in order to establish or maintain an alternative source or sources of supply for that property or service if the head of the agency determines that to do so - (A) would increase or maintain competition and would likely result in reduced overall costs for such procurement, or for any anticipated procurement, of property or services; (B) would be in the interest of national defense in having a facility (or a producer, manufacturer, or other supplier) available for furnishing the property or service in case of a national emergency or industrial mobilization; (C) would be in the interest of national defense in establishing or maintaining an essential engineering, research, or development capability to be provided by an educational or other nonprofit institution or a federally funded research and development center; (D) would ensure the continuous availability of a reliable source of supply of such property or service; (E) would satisfy projected needs for such property or service determined on the basis of a history of high demand for the property or service; or (F) in the case of medical supplies, safety supplies, or emergency supplies, would satisfy a critical need for such supplies. (2) The head of an agency may provide for the procurement of property or services covered by this section using competitive procedures, but excluding concerns other than small business concerns in furtherance of sections 9 and 15 of the Small Business Act (15 U.S.C. 638, 644) and concerns other than small business concerns, historically Black colleges and universities, and minority institutions in furtherance of section 2323 of this title. (3) A contract awarded pursuant to the competitive procedures referred to in paragraphs (1) and (2) shall not be subject to the justification and approval required by subsection (f)(1). (4) A determination under paragraph (1) may not be made for a class of purchases or contracts. (c) The head of an agency may use procedures other than competitive procedures only when - (1) the property or services needed by the agency are available from only one responsible source or only from a limited number of responsible sources and no other type of property or services will satisfy the needs of the agency; (2) the agency's need for the property or services is of such an unusual and compelling urgency that the United States would be seriously injured unless the agency is permitted to limit the number of sources from which it solicits bids or proposals; (3) it is necessary to award the contract to a particular source or sources in order (A) to maintain a facility, producer, manufacturer, or other supplier available for furnishing property or services in case of a national emergency or to achieve industrial mobilization, (B) to establish or maintain an essential engineering, research, or development capability to be provided by an educational or other nonprofit institution or a federally funded research and development center, or (C) to procure the services of an expert for use, in any litigation or dispute (including any reasonably foreseeable litigation or dispute) involving the Federal Government, in any trial, hearing, or proceeding before any court, administrative tribunal, or agency, or to procure the services of an expert or neutral for use in any part of an alternative dispute resolution or negotiated rulemaking process, whether or not the expert is expected to testify; (4) the terms of an international agreement or a treaty between the United States and a foreign government or international organization, or the written directions of a foreign government reimbursing the agency for the cost of the procurement of the property or services for such government, have the effect of requiring the use of procedures other than competitive procedures; (5) subject to subsection (k), a statute expressly authorizes or requires that the procurement be made through another agency or from a specified source, or the agency's need is for a brand- name commercial item for authorized resale; (6) the disclosure of the agency's needs would compromise the national security unless the agency is permitted to limit the number of sources from which it solicits bids or proposals; or (7) the head of the agency - (A) determines that it is necessary in the public interest to use procedures other than competitive procedures in the particular procurement concerned, and (B) notifies the Congress in writing of such determination not less than 30 days before the award of the contract. (d)(1) For the purposes of applying subsection (c)(1) - (A) in the case of a contract for property or services to be awarded on the basis of acceptance of an unsolicited research proposal, the property or services shall be considered to be available from only one source if the source has submitted an unsolicited research proposal that demonstrates a concept - (i) that is unique and innovative or, in the case of a service, for which the source demonstrates a unique capability of the source to provide the service; and (ii) the substance of which is not otherwise available to the United States, and does not resemble the substance of a pending competitive procurement; and (B) in the case of a follow-on contract for the continued development or production of a major system or highly specialized equipment, or the continued provision of highly specialized services, such property or services may be deemed to be available only from the original source and may be procured through procedures other than competitive procedures when it is likely that award to a source other than the original source would result in - (i) substantial duplication of cost to the United States which is not expected to be recovered through competition; or (ii) unacceptable delays in fulfilling the agency's needs. (2) The authority of the head of an agency under subsection (c)(7) may not be delegated. (3)(A) The contract period of a contract described in subparagraph (B) that is entered into by an agency pursuant to the authority provided under subsection (c)(2) - (i) may not exceed the time necessary - (I) to meet the unusual and compelling requirements of the work to be performed under the contract; and (II) for the agency to enter into another contract for the required goods or services through the use of competitive procedures; and (ii) may not exceed one year unless the head of the agency entering into such contract determines that exceptional circumstances apply. (B) This paragraph applies to any contract in an amount greater than the simplified acquisition threshold. (e) The head of an agency using procedures other than competitive procedures to procure property or services by reason of the application of subsection (c)(2) or (c)(6) shall request offers from as many potential sources as is practicable under the circumstances. (f)(1) Except as provided in paragraph (2), the head of an agency may not award a contract using procedures other than competitive procedures unless - (A) the contracting officer for the contract justifies the use of such procedures in writing and certifies the accuracy and completeness of the justification; (B) the justification is approved - (i) in the case of a contract for an amount exceeding $500,000 (but equal to or less than $10,000,000), by the competition advocate for the procuring activity (without further delegation) or by an official referred to in clause (ii) or (iii); (ii) in the case of a contract for an amount exceeding $10,000,000 (but equal to or less than $75,000,000), by the head of the procuring activity (or the head of the procuring activity's delegate designated pursuant to paragraph (6)(A)); or (iii) in the case of a contract for an amount exceeding $75,000,000, by the senior procurement executive of the agency designated pursuant to section 1702(c) of title 41 (without further delegation) or in the case of the Under Secretary of Defense for Acquisition, Technology, and Logistics, acting in his capacity as the senior procurement executive for the Department of Defense, the Under Secretary's delegate designated pursuant to paragraph (6)(B); and (C) any required notice has been published with respect to such contract pursuant to section 1708 of title 41 and all bids or proposals received in response to that notice have been considered by the head of the agency. (2) In the case of a procurement permitted by subsection (c)(2), the justification and approval required by paragraph (1) may be made after the contract is awarded. The justification and approval required by paragraph (1) is not required - (A) when a statute expressly requires that the procurement be made from a specified source; (B) when the agency's need is for a brand-name commercial item for authorized resale; (C) in the case of a procurement permitted by subsection (c)(7); (D) in the case of a procurement conducted under (i) chapter 85 of title 41, or (ii) section 8(a) of the Small Business Act (15 U.S.C. 637(a)); or (E) in the case of a procurement permitted by subsection (c)(4), but only if the head of the contracting activity prepares a document in connection with such procurement that describes the terms of an agreement or treaty, or the written directions, referred to in that subsection that have the effect of requiring the use of procedures other than competitive procedures. (3) The justification required by paragraph (1)(A) shall include - (A) a description of the agency's needs; (B) an identification of the statutory exception from the requirement to use competitive procedures and a demonstration, based on the proposed contractor's qualifications or the nature of the procurement, of the reasons for using that exception; (C) a determination that the anticipated cost will be fair and reasonable; (D) a description of the market survey conducted or a statement of the reasons a market survey was not conducted; (E) a listing of the sources, if any, that expressed in writing an interest in the procurement; and (F) a statement of the actions, if any, the agency may take to remove or overcome any barrier to competition before a subsequent procurement for such needs. (4) In no case may the head of an agency - (A) enter into a contract for property or services using procedures other than competitive procedures on the basis of the lack of advance planning or concerns related to the amount of funds available to the agency for procurement functions; or (B) procure property or services from another agency unless such other agency complies fully with the requirements of this chapter in its procurement of such property or services. The restriction contained in clause (B) is in addition to, and not in lieu of, any other restriction provided by law. (5)(A) The authority of the head of a procuring activity under paragraph (1)(B)(ii) may be delegated only to an officer or employee who - (i) if a member of the armed forces, is a general or flag officer; or (ii) if a civilian, is serving in a position with a grade under the General Schedule (or any other schedule for civilian officers or employees) that is comparable to or higher than the grade of brigadier general or rear admiral (lower half). (B) The authority of the Under Secretary of Defense for Acquisition, Technology, and Logistics under paragraph (1)(B)(iii) may be delegated only to - (i) an Assistant Secretary of Defense; or (ii) with respect to the element of the Department of Defense (as specified in section 111(b) of this title), other than a military department, carrying out the procurement action concerned, an officer or employee serving in or assigned or detailed to that element who - (I) if a member of the armed forces, is serving in a grade above brigadier general or rear admiral (lower half); or (II) if a civilian, is serving in a position with a grade under the General Schedule (or any other schedule for civilian officers or employees) that is comparable to or higher than the grade of major general or rear admiral. (g)(1) In order to promote efficiency and economy in contracting and to avoid unnecessary burdens for agencies and contractors, the Federal Acquisition Regulation shall provide for - (A) special simplified procedures for purchases of property and services for amounts not greater than the simplified acquisition threshold; and (B) special simplified procedures for purchases of property and services for amounts greater than the simplified acquisition threshold but not greater than $5,000,000 with respect to which the contracting officer reasonably expects, based on the nature of the property or services sought and on market research, that offers will include only commercial items. (2) A proposed purchase or contract for an amount above the simplified acquisition threshold may not be divided into several purchases or contracts for lesser amounts in order to use the simplified procedures required by paragraph (1). (3) In using simplified procedures, the head of an agency shall promote competition to the maximum extent practicable. (4) The head of an agency shall comply with the Federal Acquisition Regulation provisions referred to in section 1901(e) of title 41. (h) For the purposes of the following, purchases or contracts awarded after using procedures other than sealed-bid procedures shall be treated as if they were made with sealed-bid procedures: (1) Chapter 65 of title 41. (2) Sections 3141-3144, 3146, and 3147 of title 40. (i)(1) The Secretary of Defense shall prescribe by regulation the manner in which the Department of Defense negotiates prices for supplies to be obtained through the use of procedures other than competitive procedures, as defined in section 2302(2) of this title. (2) The regulations required by paragraph (1) shall - (A) specify the incurred overhead a contractor may appropriately allocate to supplies referred to in that paragraph; and (B) require the contractor to identify those supplies which it did not manufacture or to which it did not contribute significant value. (3) Such regulations shall not apply to an item of supply included in a contract or subcontract for which the price is based on established catalog or market prices of commercial items sold in substantial quantities to the general public. (j) The Federal Acquisition Regulation shall ensure that the requirement to obtain full and open competition is implemented in a manner that is consistent with the need to efficiently fulfill the Government's requirements. (k)(1) It is the policy of Congress that an agency named in section 2303(a) of this title should not be required by legislation to award a new contract to a specific non-Federal Government entity. It is further the policy of Congress that any program, project, or technology identified in legislation be procured through merit-based selection procedures. (2) A provision of law may not be construed as requiring a new contract to be awarded to a specified non-Federal Government entity unless that provision of law - (A) specifically refers to this subsection; (B) specifically identifies the particular non-Federal Government entity involved; and (C) specifically states that the award to that entity is required by such provision of law in contravention of the policy set forth in paragraph (1). (3) For purposes of this subsection, a contract is a new contract unless the work provided for in the contract is a continuation of the work performed by the specified entity under a preceding contract. (4) This subsection shall not apply with respect to any contract that calls upon the National Academy of Sciences to investigate, examine, or experiment upon any subject of science or art of significance to an agency named in section 2303(a) of this title and to report on such matters to the Congress or any agency of the Federal Government. (l)(1)(A) Except as provided in subparagraph (B), in the case of a procurement permitted by subsection (c), the head of an agency shall make publicly available, within 14 days after the award of the contract, the documents containing the justification and approval required by subsection (f)(1) with respect to the procurement. (B) In the case of a procurement permitted by subsection (c)(2), subparagraph (A) shall be applied by substituting "30 days" for "14 days". (2) The documents shall be made available on the website of the agency and through a government-wide website selected by the Administrator for Federal Procurement Policy. (3) This subsection does not require the public availability of information that is exempt from public disclosure under section 552(b) of title 5. -SOURCE- (Aug. 10, 1956, ch. 1041, 70A Stat. 128; Pub. L. 85-800, Sec. 8, Aug. 28, 1958, 72 Stat. 967; Pub. L. 85-861, Sec. 33(a)(12), Sept. 2, 1958, 72 Stat. 1565; Pub. L. 87-653, Sec. 1(a)-(c), Sept. 10, 1962, 76 Stat. 528; Pub. L. 90-268, Sec. 5, Mar. 16, 1968, 82 Stat. 50; Pub. L. 90-500, title IV, Sec. 405, Sept. 20, 1968, 82 Stat. 851; Pub. L. 93-356, Sec. 4, July 25, 1974, 88 Stat. 390; Pub. L. 96-513, title V, Sec. 511(76), Dec. 12, 1980, 94 Stat. 2926; Pub. L. 97-86, title IX, Sec. 907(a), Dec. 1, 1981, 95 Stat. 1117; Pub. L. 97-295, Sec. 1(24), Oct. 12, 1982, 96 Stat. 1290; Pub. L. 97- 375, title I, Sec. 114, Dec. 21, 1982, 96 Stat. 1821; Pub. L. 98- 369, div. B, title VII, Secs. 2723(a), 2727(b), July 18, 1984, 98 Stat. 1187, 1194; Pub. L. 98-577, title V, Sec. 504(b)(1), (2), Oct. 30, 1984, 98 Stat. 3086; Pub. L. 99-145, title IX, Sec. 961(a)(1), title XIII, Sec. 1303(a)(13), Nov. 8, 1985, 99 Stat. 703, 739; Pub. L. 99-500, Sec. 101(c) [title X, Secs. 923(a)-(c), 927(a)], Oct. 18, 1986, 100 Stat. 1783-82, 1783-152, 1783-155, and Pub. L. 99-591, Sec. 101(c) [title X, Secs. 923(a)-(c), 927(a)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-152, 3341-155; Pub. L. 99- 661, div. A, title IX, formerly title IV, Secs. 923(a)-(c), 927(a), title XIII, Sec. 1343(a)(14), Nov. 14, 1986, 100 Stat. 3932, 3935, 3993, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; Pub. L. 100-26, Sec. 7(d)(3), Apr. 21, 1987, 101 Stat. 281; Pub. L. 100-456, div. A, title VIII, Sec. 803, Sept. 29, 1988, 102 Stat. 2008; Pub. L. 101-189, div. A, title VIII, Secs. 812, 817, 818, 853(d), Nov. 29, 1989, 103 Stat. 1493, 1501, 1502, 1519; Pub. L. 101-510, div. A, title VIII, Sec. 806(b), Nov. 5, 1990, 104 Stat. 1592; Pub. L. 102-25, title VII, Sec. 701(d)(2), Apr. 6, 1991, 105 Stat. 114; Pub. L. 102-484, div. A, title VIII, Secs. 801(h)(2), 816, title X, Sec. 1052(23), Oct. 23, 1992, 106 Stat. 2445, 2454, 2500; Pub. L. 103-160, div. A, title IX, Sec. 904(d)(1), Nov. 30, 1993, 107 Stat. 1728; Pub. L. 103-355, title I, Secs. 1001-1003, 1004(b), 1005, title IV, Sec. 4401(a), title VII, Sec. 7203(a)(1), Oct. 13, 1994, 108 Stat. 3249, 3253, 3254, 3347, 3379; Pub. L. 104-106, div. D, title XLI, Secs. 4101(a), 4102(a), title XLII, Sec. 4202(a)(1), title XLIII, Sec. 4321(b)(4), (5), Feb. 10, 1996, 110 Stat. 642, 643, 652, 672; Pub. L. 104-320, Secs. 7(a)(1), 11(c)(1), Oct. 19, 1996, 110 Stat. 3871, 3873; Pub. L. 105-85, div. A, title VIII, Secs. 841(b), 850(f)(3)(B), title X, Sec. 1073(a)(42), (43), Nov. 18, 1997, 111 Stat. 1843, 1850, 1902; Pub. L. 107-107, div. A, title X, Sec. 1048(b)(2), Dec. 28, 2001, 115 Stat. 1225; Pub. L. 107-217, Sec. 3(b)(3), Aug. 21, 2002, 116 Stat. 1295; Pub. L. 108-375, div. A, title VIII, Sec. 815, Oct. 28, 2004, 118 Stat. 2015; Pub. L. 109- 364, div. A, title X, Sec. 1071(a)(2), Oct. 17, 2006, 120 Stat. 2398; Pub. L. 110-181, div. A, title VIII, Sec. 844(b), Jan. 28, 2008, 122 Stat. 239; Pub. L. 110-417, [div. A], title VIII, Sec. 862(b), Oct. 14, 2008, 122 Stat. 4546; Pub. L. 111-350, Sec. 5(b)(12), Jan. 4, 2011, 124 Stat. 3843.) -MISC1- HISTORICAL AND REVISION NOTES 1956 ACT -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2304(a) 41:151(c) (less proviso Feb. 19, 1948, ch. 65, of clause (11) and Secs. 2(b) (less 1st proviso of clause (16)). sentence), (c), (e), 7(d), 8, 62 Stat. 21, 22, 24. 2304(b) 41:156(d). 2304(c) 41:151(e). 2304(d) 41:151(b) (less 1st sentence). 2304(e) 41:151(c) (proviso of clause (11) and proviso of clause (16)). 2304(f) 41:157. -------------------------------------------------------------------- In subsection (a)(1), the words "the period of" are omitted as surplusage. In subsections (a)(4)-(10), and (12)-(15), the words "the purchase or contract is" are inserted for clarity. In subsection (a)(5), the words "to be rendered" are omitted as surplusage. In subsection (a)(6), the words "its Territories" are inserted for clarity. The words "the limits of" are omitted as surplusage. In subsection (a)(14), the words "and for which" are substituted for the word "when". In subsection (a)(15), the words "and for which" are substituted for 41:151(c)(15) (1st 22 words of proviso). In subsection (a)(16), the words "to have" are substituted for the words "be made or kept". In subsection (a)(17), the first 7 words are inserted for clarity. In subsection (b), the words "shall be kept" are substituted for the words "shall be preserved in the files". The words "six years after the date" are substituted for the words "a period of six years following". In subsection (c), the words "but such authorization shall be required in the same manner as heretofore" and "continental", in 41:151(e), are omitted as surplusage. In subsection (d), the words "before making" are substituted for the words "Whenever it is proposed to make". In subsection (e), the words "beginning six months after the effective date of this chapter" are omitted as executed. The words "on May 19 and November 19 of each year" are substituted for the words "and at the end of each six-month period thereafter", since the effective date of the source statute was May 19, 1948, and the first report was made on November 19, 1948. The words "property and services covered by each contract" are substituted for the words "work required to be performed thereunder". 1958 ACT The change is necessary to reflect the present Commonwealth status of Puerto Rico. 1982 ACT -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2304(a) 10:2304 (note). Mar. 16, 1967, Pub. L. (1st 90-5, Sec. 304, 81 Stat. sentence) 6. 2304(f)( 10:2304(f)(1). 1) 2304(i) 10:2304 (note). Sept. 21, 1977, Pub. L. 95-111, Sec. 836, 91 Stat. 906. -------------------------------------------------------------------- In subsection (a), the words "The Secretary of Defense is hereby directed that insofar as practicable all contracts shall be formally advertised" are omitted as unnecessary because of 10:2304(a) (1st sentence). Subsection (f)(1) is amended to correct a mistake in spelling. In subsection (i)(1)(B), the words "or States" are omitted because of 1:1. -COD- CODIFICATION Pub. L. 99-591 is a corrected version of Pub. L. 99-500. -MISC2- AMENDMENTS 2011 - Subsec. (f)(1)(B)(iii). Pub. L. 111-350, Sec. 5(b)(12)(A), substituted "section 1702(c) of title 41" for "section 16(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 414(c))". Subsec. (f)(1)(C). Pub. L. 111-350, Sec. 5(b)(12)(B), substituted "section 1708 of title 41" for "section 18 of the Office of Federal Procurement Policy Act (41 U.S.C. 416)". Subsec. (f)(2)(D)(i). Pub. L. 111-350, Sec. 5(b)(12)(C), substituted "chapter 85 of title 41" for "the Javits-Wagner-O'Day Act (41 U.S.C. 46 et seq.)". Subsec. (g)(4). Pub. L. 111-350, Sec. 5(b)(12)(D), substituted "section 1901(e) of title 41" for "section 31(f) of the Office of Federal Procurement Policy Act (41 U.S.C. 427)". Subsec. (h)(1). Pub. L. 111-350, Sec. 5(b)(12)(E), substituted "Chapter 65 of title 41" for "The Walsh-Healey Act (41 U.S.C. 35 et seq.)". 2008 - Subsec. (d)(3). Pub. L. 110-417 added par. (3). Subsec. (f)(4) to (6). Pub. L. 110-181, Sec. 844(b)(2), redesignated pars. (5) and (6) as (4) and (5), respectively, and struck out former par. (4) which read as follows: "The justification required by paragraph (1)(A) and any related information, and any document prepared pursuant to paragraph (2)(E), shall be made available for inspection by the public consistent with the provisions of section 552 of title 5." Subsec. (l). Pub. L. 110-181, Sec. 844(b)(1), added subsec. (l). 2006 - Subsec. (f)(1)(B)(iii). Pub. L. 109-364 substituted "section 16(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 414(c))" for "section 16(3) of the Office of Federal Procurement Policy Act (41 U.S.C. 414(3))". 2004 - Subsec. (f)(1)(B)(ii), (iii). Pub. L. 108-375 substituted "$75,000,000" for "$50,000,000". 2002 - Subsec. (h). Pub. L. 107-217, Sec. 3(b)(3)(A), struck out "laws" after "following" in introductory provisions. Subsec. (h)(2). Pub. L. 107-217, Sec. 3(b)(3)(B), substituted "Sections 3141-3144, 3146, and 3147 of title 40" for "The Act entitled 'An Act relating to the rate of wages for laborers and mechanics employed on public buildings of the United States and the District of Columbia by contractors and subcontractors, and for other purposes', approved March 3, 1931 (commonly referred to as the 'Davis-Bacon Act') (40 U.S.C. 276a - 276a-5)". 2001 - Subsec. (f)(1)(B)(iii), (6)(B). Pub. L. 107-107 substituted "Under Secretary of Defense for Acquisition, Technology, and Logistics" for "Under Secretary of Defense for Acquisition and Technology". 1997 - Subsec. (c)(5). Pub. L. 105-85, Sec. 1073(a)(42), substituted "subsection (k)" for "subsection (j)". Subsec. (f)(1)(B)(iii). Pub. L. 105-85, Sec. 1073(a)(43)(A), substituted "(6)(B)" for "(6)(C)". Subsec. (f)(2)(E). Pub. L. 105-85, Sec. 841(b), struck out "and such document is approved by the competition advocate for the procuring activity" after "requiring the use of procedures other than competitive procedures". Subsec. (f)(6)(B), (C). Pub. L. 105-85, Sec. 1073(a)(43)(B), redesignated subpar. (C) as (B), substituted "paragraph (1)(B)(iii)" for "paragraph (1)(B)(iv)" in introductory provisions, and struck out former subpar. (B), which read as follows: "The authority of the senior procurement executive under paragraph (1)(B)(iii) may be delegated only to an officer or employee within the senior procurement executive's organization who - "(i) if a member of the armed forces, is a general or flag officer; or "(ii) if a civilian, is serving in a position in grade GS-16 or above (or in a comparable or higher position under any other schedule for civilian officers or employees)." Subsec. (g)(4). Pub. L. 105-85, Sec. 850(f)(3)(B), substituted "31(f)" for "31(g)". 1996 - Subsec. (c)(3)(C). Pub. L. 104-320 substituted "agency, or to procure the services of an expert or neutral for use" for "agency, or" and inserted "or negotiated rulemaking" after "alternative dispute resolution". Subsec. (f)(1)(B)(i). Pub. L. 104-106, Sec. 4102(a)(1), substituted "$500,000 (but equal to or less than $10,000,000)" for "$100,000 (but equal to or less than $1,000,000)" and "(ii) or (iii)" for "(ii), (iii), or (iv)". Subsec. (f)(1)(B)(ii). Pub. L. 104-106, Sec. 4102(a)(2), substituted "$10,000,000 (but equal to or less than $50,000,000)" for "$1,000,000 (but equal to or less than $10,000,000)" and inserted "or" at end. Subsec. (f)(1)(B)(iii), (iv). Pub. L. 104-106, Sec. 4102(a)(3), (4), redesignated cl. (iv) as (iii) and struck out former cl. (iii) which read as follows: "in the case of a contract for an amount exceeding $10,000,000 (but equal to or less than $50,000,000), by the senior procurement executive of the agency designated pursuant to section 16(3) of the Office of Federal Procurement Policy Act (41 U.S.C. 414(3)) or the senior procurement executive's delegate designated pursuant to paragraph (6)(B), or in the case of the Under Secretary of Defense for Acquisition and Technology, acting in his capacity as the senior procurement executive for the Department of Defense, the Under Secretary's delegate designated pursuant to paragraph (6)(C); or". Subsec. (f)(2)(D). Pub. L. 104-106, Sec. 4321(b)(4), substituted "the Javits-Wagner-O'Day Act (41 U.S.C. 46 et seq.)," for "the Act of June 25, 1938 (41 U.S.C. 46 et seq.), popularly referred to as the Wagner-O'Day Act,". Subsec. (g)(1). Pub. L. 104-106, Sec. 4202(a)(1)(A), substituted "shall provide for - " and subpars. (A) and (B) for "shall provide for special simplified procedures for purchases of property and services for amounts not greater than the simplified acquisition threshold." Subsec. (g)(4). Pub. L. 104-106, Sec. 4202(a)(1)(B), added par. (4). Subsec. (h)(1). Pub. L. 104-106, Sec. 4321(b)(5), added par. (1) and struck out former par. (1) which read as follows: "The Act entitled 'An Act to provide conditions for the purchase of supplies and the making of contracts by the United States, and for other purposes', approved June 30, 1936 (commonly referred to as the 'Walsh-Healey Act') (41 U.S.C. 35-45)." Subsecs. (j), (k). Pub. L. 104-106, Sec. 4101(a), added subsec. (j) and redesignated former subsec. (j) as (k). 1994 - Subsec. (a)(1)(A). Pub. L. 103-355, Sec. 1001(1), substituted "Federal Acquisition Regulation" for "modifications to regulations promulgated pursuant to section 2752 of the Competition in Contracting Act of 1984 (41 U.S.C. 403 note)". Subsec. (b)(1)(D) to (F). Pub. L. 103-355, Sec. 1002(a), added subpars. (D) to (F). Subsec. (b)(4). Pub. L. 103-355, Sec. 1002(b), added par. (4). Subsec. (c)(3)(C). Pub. L. 103-355, Sec. 1005, added subpar. (C). Subsec. (c)(5). Pub. L. 103-355, Sec. 7203(a)(1)(A), inserted "subject to subsection (j)," after "(5)". Subsec. (f)(1)(B)(i). Pub. L. 103-355, Sec. 1003, inserted before semicolon at end "or by an official referred to in clause (ii), (iii), or (iv)". Subsec. (g)(1). Pub. L. 103-355, Secs. 1001(2), 4401(a)(1), substituted "Federal Acquisition Regulation" for "regulations modified in accordance with section 2752 of the Competition in Contracting Act of 1984 (41 U.S.C. 403 note)" and "purchases of property and services for amounts not greater than the simplified acquisition threshold" for "small purchases of property and services". Subsec. (g)(2). Pub. L. 103-355, Sec. 4401(a)(4), substituted "simplified acquisition threshold" for "small purchase threshold" and "simplified procedures" for "small purchase procedures". Pub. L. 103-355, Sec. 4401(a)(2), (3), redesignated par. (3) as (2) and struck out former par. (2) which read as follows: "For the purposes of this subsection, a small purchase is a purchase or contract for an amount which does not exceed the small purchase threshold." Subsec. (g)(3). Pub. L. 103-355, Sec. 4401(a)(5), substituted "simplified procedures" for "small purchase procedures". Pub. L. 103-355, Sec. 4401(a)(3), redesignated par. (4) as (3). Former par. (3) redesignated (2). Subsec. (g)(4). Pub. L. 103-355, Sec. 4401(a)(3), redesignated par. (4) as (3). Subsec. (j). Pub. L. 103-355, Sec. 7203(a)(1)(B), added subsec. (j). Pub. L. 103-355, Sec. 1004(b), struck out subsec. (j) which related to authority of Secretary of Defense to enter into master agreements for advisory and assistance services. 1993 - Subsec. (f)(1)(B)(iii), (iv), (6)(C). Pub. L. 103-160 substituted "Under Secretary of Defense for Acquisition and Technology" for "Under Secretary of Defense for Acquisition". 1992 - Subsec. (b)(2). Pub. L. 102-484, Sec. 801(h)(2), substituted "section 2323 of this title" for "section 1207 of the National Defense Authorization Act for Fiscal Year 1987 (10 U.S.C. 2301 note)". Subsec. (j)(3)(A). Pub. L. 102-484, Sec. 1052(23), substituted "section 8(d) of the Small Business Act (15 U.S.C. 637(d))" for "section 8(e) of the Small Business Act (15 U.S.C. 637(e))". Subsec. (j)(5). Pub. L. 102-484, Sec. 816, substituted "on September 30, 1994." for "at the end of the three-year period beginning on the date on which final regulations prescribed to carry out this subsection take effect." 1991 - Subsec. (g)(2). Pub. L. 102-25, Sec. 701(d)(2)(A)(i), substituted "subsection" for "chapter". Subsec. (g)(5). Pub. L. 102-25, Sec. 701(d)(2)(A)(ii), struck out par. (5) which provided that in this subsection, the term "small purchase threshold" has the meaning given such term in section 403(11) of title 41. See section 2302(7) of this title. Subsec. (j)(3)(A). Pub. L. 102-25, Sec. 701(d)(2)(B), substituted "the small purchase threshold" for "$25,000". 1990 - Subsec. (g). Pub. L. 101-510 substituted "the small purchase threshold" for "$25,000" in pars. (2) and (3) and added par. (5). 1989 - Subsec. (b)(2). Pub. L. 101-189, Sec. 853(d), substituted "The head of an agency" for "An executive agency" and "concerns other than" for "other than" and inserted before period at end "and concerns other than small business concerns, historically Black colleges and universities, and minority institutions in furtherance of section 1207 of the National Defense Authorization Act for Fiscal Year 1987 (10 U.S.C. 2301 note)". Subsec. (f)(1)(B)(iii). Pub. L. 101-189, Sec. 818(a)(1), (3), added cl. (iii). Former cl. (iii) redesignated (iv). Subsec. (f)(1)(B)(iv). Pub. L. 101-189, Sec. 818(a)(2), (c)(1), redesignated cl. (iii) as (iv) and substituted "$50,000,000" for "$10,000,000" and "paragraph (6)(C)" for "paragraph (6)(B)". Subsec. (f)(2)(E). Pub. L. 101-189, Sec. 817(a), added subpar. (E). Subsec. (f)(4). Pub. L. 101-189, Sec. 817(b), inserted ", and any document prepared pursuant to paragraph (2)(E)," after "any related information". Subsec. (f)(6)(B). Pub. L. 101-189, Sec. 818(b)(2), added subpar. (B). Former subpar. (B) redesignated (C). Subsec. (f)(6)(C). Pub. L. 101-189, Sec. 818(b)(1), (c)(2), redesignated subpar. (B) as (C) and substituted "paragraph (1)(B)(iv)" for "paragraph (1)(B)(iii)". Subsec. (j). Pub. L. 101-189, Sec. 812, added subsec. (j). 1988 - Subsec. (f)(1)(B)(ii). Pub. L. 100-456, Sec. 803(1), substituted "(or the head of the procuring activity's delegate designated pursuant to paragraph (6)(A));" for "or a delegate who, if a member of the armed forces, is a general or flag officer or, if a civilian, is serving in a position in grade GS-16 or above under the General Schedule (or in a comparable or higher position under another schedule);". Subsec. (f)(1)(B)(iii). Pub. L. 100-456, Sec. 803(2), inserted "or in the case of the Under Secretary of Defense for Acquisition, acting in his capacity as the senior procurement executive for the Department of Defense, the Under Secretary's delegate designated pursuant to paragraph (6)(B)" before semicolon at end. Subsec. (f)(6). Pub. L. 100-456, Sec. 803(3), added par. (6). 1987 - Subsec. (a)(1)(A). Pub. L. 100-26, Sec. 7(d)(3)(A), inserted "(41 U.S.C. 403 note)" after "Competition in Contracting Act of 1984". Subsec. (f)(1)(C). Pub. L. 100-26, Sec. 7(d)(3)(B), inserted "(41 U.S.C. 416)" after "Policy Act". Subsec. (g)(1). Pub. L. 100-26, Sec. 7(d)(3)(A), inserted "(41 U.S.C. 403 note)" after "Act of 1984". 1986 - Subsec. (b)(2). Pub. L. 99-661, Sec. 1343(a)(14), substituted "15 U.S.C. 638," for "15 U.S.C. 639;". Subsec. (c)(1). Pub. L. 99-500 and Pub. L. 99-591, Sec. 101(c) [Sec. 923(a)], Pub. L. 99-661, Sec. 923(a), amended par. (1) identically, inserting "or only from a limited number of responsible sources". Subsec. (d)(1)(A). Pub. L. 99-500 and Pub. L. 99-591, Sec. 101(c) [Sec. 923(b)], Pub. L. 99-661, Sec. 923(b), amended subpar. (A) identically, substituting "a concept - " for "a unique and innovative concept", adding cl. (i), and designating provision relating to nonavailability to the United States and nonresemblance to a pending competitive procurement as cl. (ii). Subsec. (d)(1)(B). Pub. L. 99-500 and Pub. L. 99-591, Sec. 101(c) [Sec. 923(c)], Pub. L. 99-661, Sec. 923(c), amended subpar. (B) identically, inserting ", or the continued provision of highly specialized services, such property or services may be deemed to be available only from the original source and may be procured through procedures other than competitive procedures" after "highly specialized equipment", inserted a one-em dash after "would result in", paragraphed cls. (i) and (ii), in cl. (i) substituted "competition;" for "competition,", and in cl. (ii) struck out ", such property may be deemed to be available only from the original source and may be procured through procedures other than competitive procedures" after "agency's needs". Subsec. (i). Pub. L. 99-500 and Pub. L. 99-591, Sec. 101(c) [Sec. 927(a)], Pub. L. 99-661, Sec. 927(a), amended section identically, adding subsec. (i). 1985 - Subsec. (a)(1)(B). Pub. L. 99-145, Sec. 1303(a)(13), substituted "procedures" for "krocedures". Subsec. (f)(2). Pub. L. 99-145, Sec. 961(a)(1), amended second sentence generally. Prior to amendment, second sentence read as follows: "The justification and approval required by paragraph (1) is not required in the case of a procurement permitted by subsection (c)(7) or in the case of a procurement conducted under - "(A) the Act of June 25, 1938 (41 U.S.C. 46 et seq.), popularly referred to as the Wagner-O'Day Act; or "(B) the authority of section 8(a) of the Small Business Act (15 U.S.C. 637)." 1984 - Pub. L. 98-369, Sec. 2723(a), substituted "Contracts: competition requirements" for "Purchases and contracts: formal advertising; exceptions" in section catchline and struck out subsecs. (a) to (e) and (g) to (i), redesignated subsec. (f) as (h), and added new subsecs. (a) through (g), thereby removing the prior statutory preference for formal advertising and installing instead more competitive procurement procedures, including dual sourcing, but with provision for the use of other than competitive procedures in specified situations. Subsec. (b)(2). Pub. L. 98-577, Sec. 504(b)(1), substituted provisions to the effect that executive agencies may provide for procurement of property or services covered by this section using competitive procedures but excluding other than small business concerns for provisions which provided that executive agencies shall use competitive procedures but may restrict a solicitation to allow only small business concerns to compete. Subsec. (b)(3). Pub. L. 98-577, Sec. 504(b)(1), added par. (3). Subsec. (f)(2). Pub. L. 98-577, Sec. 504(b)(2), designated existing provisions as subpar. (A) and added subpar. (B). Subsec. (h). Pub. L. 98-369, Sec. 2727(b), substituted "contracts awarded after using procedures other than sealed-bid procedures shall be treated as if they were made with sealed bid procedures" for "contracts negotiated under this section shall be treated as if they were made with formal advertising". Pub. L. 98-369, Sec. 2723(a)(1)(B), redesignated subsec. (f) as (h). 1982 - Subsec. (a). Pub. L. 97-295, Sec. 1(24)(A), inserted ", and shall be awarded on a competitive bid basis to the lowest responsible bidder," after "formal advertising". Subsec. (e). Pub. L. 97-375 repealed subsec. (e) which directed that a report be made on May and November 19 of each year of purchases and contracts under cls. (11) and (16) of subsec. (a) since the last report, and that the report name each contractor, state the amount of each contract, and describe, with consideration of the national security, the property and services covered by each contract. Subsec. (f)(1). Pub. L. 97-295, Sec. 1(24)(B), substituted "Healey" for "Healy" after "Walsh-". Subsec. (i). Pub. L. 97-295, Sec. 1(24)(C), added subsec. (i). 1981 - Subsecs. (a)(3), (g). Pub. L. 97-86 substituted "$25,000" for "$10,000". 1980 - Subsec. (f). Pub. L. 96-513 substituted "(1) The Act entitled 'An Act to provide conditions for the purchase of supplies and the making of contracts by the United States, and for other purposes', approved June 30, 1936 (commonly referred to as the 'Walsh-Healy Act') (41 U.S.C. 35-45).", for "(1) Sections 35-45 of title 41.", and "(2) The Act entitled 'An Act relating to the rate of wages for laborers and mechanics employed on public buildings of the United States and the District of Columbia by contractors and subcontractors, and for other purposes', approved March 3, 1931 (commonly referred to as the 'Davis-Bacon Act') (40 U.S.C. 276a - 276a-5)." for "(2) Sections 276a - 276a-5 of title 40.", and struck out "(3) Sections 324 and 325a of title 40". 1974 - Subsec. (a)(3). Pub. L. 93-356, Sec. 4(a), substituted "$10,000" for "$2,500". Subsec. (g). Pub. L. 93-356, Sec. 4(b), substituted "$10,000" for "$2,500". 1968 - Subsec. (g). Pub. L. 90-500 required that the proposals solicited from the maximum number of qualified sources, consistent with the nature and requirements of the supplies or services to be procured, include price. Subsec. (h). Pub. L. 90-268 added subsec. (h). 1962 - Subsec. (a). Pub. L. 87-653, Sec. 1(a), (b), provided that formal advertising be used where feasible and practicable under existing conditions and circumstances, subjected the agency head to the requirements of section 2310 of this title before negotiating a contract where formal advertising is not feasible and practicable and, in par. (14), substituted "would be likely to result in additional cost to the Government by reason of duplication of investment or would result in duplication of necessary preparation which would unduly delay the procurement of the property;" for "and competitive bidding might require duplication of investment or preparation already made or would unduly delay the procurement of that property; or". Subsec. (g). Pub. L. 87-653, Sec. 1(c), added subsec. (g). 1958 - Subsec. (a). Pub. L. 85-861 included Commonwealths in cl. (6). Pub. L. 85-800 substituted "$2,500" for "$1,000" in cl. (3) and inserted "or nonperishable" in cl. (9). EFFECTIVE DATE OF 1997 AMENDMENT Amendment by section 850(f)(3)(B) of Pub. L. 105-85 effective 180 days after Nov. 18, 1997, see section 850(g) of Pub. L. 105-85, set out as a note under section 2302c of this title. EFFECTIVE DATE OF 1996 AMENDMENT For effective date and applicability of amendments by Pub. L. 104- 106, see section 4401 of Pub. L. 104-106, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1994 AMENDMENT For effective date and applicability of amendment by Pub. L. 103- 355, see section 10001 of Pub. L. 103-355, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1986 AMENDMENT Section 101(c) [title X, Sec. 923(d)] of Pub. L. 99-500 and Pub. L. 99-591, and section 923(d) of title IX, formerly title IV of Pub. L. 99-661, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, provided that: "(1) The amendment made by subsection (a) [amending this section] shall apply with respect to contracts for which solicitations are issued after the end of the 180-day period beginning on the date of the enactment of this Act [Oct. 18, 1986]. "(2) The amendment made by subsection (b) [amending this section] shall apply with respect to contracts awarded on the basis of unsolicited research proposals after the end of the 180-day period beginning on the date of the enactment of this Act. "(3) The amendments made by subsection (c) [amending this section] shall apply with respect to follow-on contracts awarded after the end of the 180-day period beginning on the date of the enactment of this Act." EFFECTIVE DATE OF 1985 AMENDMENT Section 961(e) of Pub. L. 99-145 provided that: "The amendments made by subsections (a) [amending this section and section 253 of Title 41, Public Contracts], (b) [amending section 2323 (now section 2343) of this title], and (c) [amending section 759 of former Title 40, Public Buildings, Property, and Works] shall take effect as if included in the enactment of the Competition in Contracting Act of 1984 (title VII of division B of Public Law 98- 369) [see Effective Date of 1984 Amendment note set out under section 2302 of this title]." EFFECTIVE DATE OF 1984 AMENDMENT Amendment by Pub. L. 98-369 applicable with respect to any solicitation for bids or proposals issued after Mar. 31, 1985, see section 2751 of Pub. L. 98-369, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1980 AMENDMENT Amendment by Pub. L. 96-513 effective Dec. 12, 1980, see section 701(b)(3) of Pub. L. 96-513, set out as a note under section 101 of this title. EFFECTIVE DATE OF 1962 AMENDMENT Section 1(h) of Pub. L. 87-653 provided that: "The amendments made by this Act [amending this section and sections 2306, 2310, and 2311 of this title] shall take effect on the first day of the third calendar month which begins after the date of enactment of this Act [Sept. 10, 1962]." EFFECTIVE DATE OF 1958 AMENDMENT Amendment by Pub. L. 85-861 effective Aug. 10, 1956, see section 33(g) of Pub. L. 85-861, set out as a note under section 101 of this title. CONSTRUCTION OF 1994 AMENDMENT Repeal of prior subsec. (j) of this section by section 1004(b) of Pub. L. 103-355 not to be construed as modifying or superseding, or as intended to impair or restrict, authorities or responsibilities under former section 759 or former subchapter VI (Sec. 541 et seq.) of chapter 10 of Title 40 [now chapter 11 of Title 40, Public Buildings, Property, and Works], see section 1004(d) of Pub. L. 103- 355, set out as a note under section 2304a of this title. CONSTRUCTION OF 1984 AMENDMENT Section 2723(c) of Pub. L. 98-369 provided that: "The amendments made by this section [amending this section and section 2305 of this title] do not supersede or affect the provisions of section 8(a) of the Small Business Act (15 U.S.C. 637(a))." REQUIREMENTS FOR INFORMATION RELATING TO SUPPLY CHAIN RISK Pub. L. 111-383, div. A, title VIII, Sec. 806, Jan. 7, 2011, 124 Stat. 4260, provided that: "(a) Authority. - Subject to subsection (b), the head of a covered agency may - "(1) carry out a covered procurement action; and "(2) limit, notwithstanding any other provision of law, in whole or in part, the disclosure of information relating to the basis for carrying out a covered procurement action. "(b) Determination and Notification. - The head of a covered agency may exercise the authority provided in subsection (a) only after - "(1) obtaining a joint recommendation by the Under Secretary of Defense for Acquisition, Technology, and Logistics and the Chief Information Officer of the Department of Defense, on the basis of a risk assessment by the Under Secretary of Defense for Intelligence, that there is a significant supply chain risk to a covered system; "(2) making a determination in writing, in unclassified or classified form, with the concurrence of the Under Secretary of Defense for Acquisition, Technology, and Logistics, that - "(A) use of the authority in subsection (a)(1) is necessary to protect national security by reducing supply chain risk; "(B) less intrusive measures are not reasonably available to reduce such supply chain risk; and "(C) in a case where the head of the covered agency plans to limit disclosure of information under subsection (a)(2), the risk to national security due to the disclosure of such information outweighs the risk due to not disclosing such information; and "(3) providing a classified or unclassified notice of the determination made under paragraph (2) to the appropriate congressional committees, which notice shall include - "(A) the information required by section 2304(f)(3) of title 10, United States Code; "(B) the joint recommendation by the Under Secretary of Defense for Acquisition, Technology, and Logistics and the Chief Information Officer of the Department of Defense as specified in paragraph (1); "(C) a summary of the risk assessment by the Under Secretary of Defense for Intelligence that serves as the basis for the joint recommendation specified in paragraph (1); and "(D) a summary of the basis for the determination, including a discussion of less intrusive measures that were considered and why they were not reasonably available to reduce supply chain risk. "(c) Delegation. - The head of a covered agency may not delegate the authority provided in subsection (a) or the responsibility to make a determination under subsection (b) to an official below the level of the service acquisition executive for the agency concerned. "(d) Limitation on Disclosure. - If the head of a covered agency has exercised the authority provided in subsection (a)(2) to limit disclosure of information - "(1) no action undertaken by the agency head under such authority shall be subject to review in a bid protest before the Government Accountability Office or in any Federal court; and "(2) the agency head shall - "(A) notify appropriate parties of a covered procurement action and the basis for such action only to the extent necessary to effectuate the covered procurement action; "(B) notify other Department of Defense components or other Federal agencies responsible for procurements that may be subject to the same or similar supply chain risk, in a manner and to the extent consistent with the requirements of national security; and "(C) ensure the confidentiality of any such notifications. "(e) Definitions. - In this section: "(1) Head of a covered agency. - The term 'head of a covered agency' means each of the following: "(A) The Secretary of Defense. "(B) The Secretary of the Army. "(C) The Secretary of the Navy. "(D) The Secretary of the Air Force. "(2) Covered procurement action. - The term 'covered procurement action' means any of the following actions, if the action takes place in the course of conducting a covered procurement: "(A) The exclusion of a source that fails to meet qualification standards established in accordance with the requirements of section 2319 of title 10, United States Code, for the purpose of reducing supply chain risk in the acquisition of covered systems. "(B) The exclusion of a source that fails to achieve an acceptable rating with regard to an evaluation factor providing for the consideration of supply chain risk in the evaluation of proposals for the award of a contract or the issuance of a task or delivery order. "(C) The decision to withhold consent for a contractor to subcontract with a particular source or to direct a contractor for a covered system to exclude a particular source from consideration for a subcontract under the contract. "(3) Covered procurement. - The term 'covered procurement' means - "(A) a source selection for a covered system or a covered item of supply involving either a performance specification, as provided in section 2305(a)(1)(C)(ii) of title 10, United States Code, or an evaluation factor, as provided in section 2305(a)(2)(A) of such title, relating to supply chain risk; "(B) the consideration of proposals for and issuance of a task or delivery order for a covered system or a covered item of supply, as provided in section 2304c(d)(3) of title 10, United States Code, where the task or delivery order contract concerned includes a contract clause establishing a requirement relating to supply chain risk; or "(C) any contract action involving a contract for a covered system or a covered item of supply where such contract includes a clause establishing requirements relating to supply chain risk. "(4) Supply chain risk. - The term 'supply chain risk' means the risk that an adversary may sabotage, maliciously introduce unwanted function, or otherwise subvert the design, integrity, manufacturing, production, distribution, installation, operation, or maintenance of a covered system so as to surveil, deny, disrupt, or otherwise degrade the function, use, or operation of such system. "(5) Covered system. - The term 'covered system' means a national security system, as that term is defined in section 3542(b) of title 44, United States Code. "(6) Covered item of supply. - The term 'covered item of supply' means an item of information technology (as that term is defined in section 11101 of title 40, United States Code) that is purchased for inclusion in a covered system, and the loss of integrity of which could result in a supply chain risk for a covered system. "(7) Appropriate congressional committees. - The term 'appropriate congressional committees' means - "(A) in the case of a covered system included in the National Intelligence Program or the Military Intelligence Program, the Select Committee on Intelligence of the Senate, the Permanent Select Committee on Intelligence of the House of Representatives, and the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives]; and "(B) in the case of a covered system not otherwise included in subparagraph (A), the congressional defense committees. "(f) Effective Date. - The requirements of this section shall take effect on the date that is 180 days after the date of the enactment of this Act [Jan. 7, 2011] and shall apply to - "(1) contracts that are awarded on or after such date; and "(2) task and delivery orders that are issued on or after such date pursuant to contracts that awarded before, on, or after such date. "(g) Sunset. - The authority provided in this section shall expire on the date that is three years after the date of the enactment of this Act." PUBLICATION OF NOTIFICATION OF BUNDLING OF CONTRACTS OF THE DEPARTMENT OF DEFENSE Pub. L. 111-84, div. A, title VIII, Sec. 820, Oct. 28, 2009, 123 Stat. 2410, provided that: "(a) Requirement to Publish Notification for Bundling. - A contracting officer of the Department of Defense carrying out a covered acquisition shall publish a notification consistent with the requirements of paragraph (c)(2) of subpart 10.001 of the Federal Acquisition Regulation on the website known as FedBizOpps.gov (or any successor site) at least 30 days prior to the release of a solicitation for such acquisition and, if the agency has determined that measurably substantial benefits are expected to be derived as a result of bundling such acquisition, shall include in the notification a brief description of the benefits. "(b) Covered Acquisition Defined. - In this section, the term 'covered acquisition' means an acquisition that is - "(1) funded entirely using funds of the Department of Defense; and "(2) covered by subpart 7.107 of the Federal Acquisition Regulation (relating to acquisitions involving bundling). "(c) Construction. - "(1) Notification. - Nothing in this section shall be construed to alter the responsibility of a contracting officer to provide the notification referred to in subsection (a) with respect to a covered acquisition, or otherwise provide notification, to any party concerning such acquisition under any other requirement of law or regulation. "(2) Disclosure. - Nothing in this section shall be construed to require the public availability of information that is exempt from public disclosure under section 552(b) of title 5, United States Code, or is otherwise restricted from public disclosure by law or Executive order. "(3) Issuance of solicitation. - Nothing in this section shall be construed to require a contracting officer to delay the issuance of a solicitation in order to meet the requirements of subsection (a) if the expedited issuance of such solicitation is otherwise authorized under any other requirement of law or regulation." SMALL ARMS ACQUISITION STRATEGY AND REQUIREMENTS REVIEW Pub. L. 110-417, [div. A], title I, Sec. 143, Oct. 14, 2008, 122 Stat. 4381, as amended by Pub. L. 111-383, div. A, title X, Sec. 1075(e)(1), Jan. 7, 2011, 124 Stat. 4374, provided that: "(a) Secretary of Defense Report. - Not later than 120 days after the date of the enactment of this Act [Oct. 14, 2008], the Secretary of Defense shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report on the small arms requirements of the Armed Forces and the industrial base of the United States. The report shall include the following: "(1) An assessment of Department of Defense-wide small arms requirements in terms of capabilities and quantities, based on an analysis of the small arms capability assessments of each military department. "(2) An assessment of plans for small arms research, development, and acquisition programs to meet the requirements identified under paragraph (1). "(3) An assessment of capabilities, capacities, and risks in the small arms industrial base of the United States to meet the requirements of the Department of Defense for pistols, carbines, rifles, and light, medium, and heavy machine guns during the 20 years following the date of the report. "(4) An assessment of the costs, benefits, and risks of full and open competition for the procurement of non-developmental pistols and carbines that are not technically compatible with the M9 pistol or M4 carbine to meet the requirements identified under paragraph (1). "(b) Competition for a New Individual Weapon. - "(1) Competition required. - If the small arms capabilities based assessments by the Army identify gaps in small arms capabilities and the Secretary of the Army determines that a new individual weapon is required to address such gaps, the Secretary shall procure the new individual weapon using full and open competition as described in paragraph (2). "(2) Full and open competition. - The full and open competition described in this paragraph is competition among all responsible manufacturers that - "(A) is open to all developmental item solutions and non- developmental item solutions; and "(B) provides for the award of a contract based on selection criteria that reflect the key performance parameters and attributes identified in a service requirements document approved by the Army. "(c) Small Arms Defined. - In this section, the term 'small arms' - "(1) means man-portable or vehicle-mounted light weapons, designed primarily for use by individual military personnel for anti-personnel use; and "(2) includes pistols, carbines, rifles, and light, medium, and heavy machine guns." IMPLEMENTATION OF STATUTORY REQUIREMENTS REGARDING THE NATIONAL TECHNOLOGY AND INDUSTRIAL BASE Pub. L. 110-417, [div. A], title VIII, Sec. 802, Oct. 14, 2008, 122 Stat. 4518, provided that: "(a) Guidance Required. - Not later than 270 days after the date of the enactment of this Act [Oct. 14, 2008], the Secretary of Defense shall issue guidance regarding - "(1) the appropriate application of the authority in sections 2304(b) and 2304(c)(3)(A) of title 10, United States Code, in connection with major defense acquisition programs; and "(2) the appropriate timing and performance of the requirement in section 2440 of title 10, United States Code, to consider the national technology and industrial base in the development and implementation of acquisition plans for each major defense acquisition program. "(b) Definitions. - In this section;[:] "(1) Major defense acquisition program. - The term 'major defense acquisition program' has the meaning provided in section 2430 of title 10, United States Code. "(2) National technology and industrial base. - The term 'national technology and industrial base' has the meaning provided in section 2500(1) of title 10, United States Code." PLAN FOR RESTRICTING GOVERNMENT-UNIQUE CONTRACT CLAUSES ON COMMERCIAL CONTRACTS Pub. L. 110-181, div. A, title VIII, Sec. 821, Jan. 28, 2008, 122 Stat. 226, provided that: "(a) Plan. - The Under Secretary of Defense for Acquisition, Technology, and Logistics shall develop and implement a plan to minimize the number of government-unique contract clauses used in commercial contracts by restricting the clauses to the following: "(1) Government-unique clauses authorized by law or regulation. "(2) Any additional clauses that are relevant and necessary to a specific contract. "(b) Commercial Contract. - In this section: "(1) The term 'commercial contract' means a contract awarded by the Federal Government for the procurement of a commercial item. "(2) The term 'commercial item' has the meaning provided by section 4(12) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 403(12)) [see 41 U.S.C. 103]." TELEPHONE SERVICES FOR MILITARY PERSONNEL SERVING IN COMBAT ZONES Pub. L. 110-181, div. A, title VIII, Sec. 885, Jan. 28, 2008, 122 Stat. 265, as amended by Pub. L. 111-383, div. A, title VI, Sec. 641, Jan. 7, 2011, 124 Stat. 4241; Pub. L. 112-81, div. A, title X, Sec. 1062(c), Dec. 31, 2011, 125 Stat. 1585, provided that: "(a) Competitive Procedures Required. - "(1) Requirement. - When the Secretary of Defense considers it necessary to provide morale, welfare, and recreation telephone services for military personnel serving in combat zones, the Secretary shall use competitive procedures when entering into a contract to provide those services. "(2) Review and determination. - Before soliciting bids or proposals for new contracts, or considering extensions to existing contracts, to provide morale, welfare, and recreation telephone services for military personnel serving in combat zones, the Secretary shall review and determine whether it is in the best interest of the Department to require bids or proposals, or adjustments for the purpose of extending a contract, to include options that minimize the cost of the telephone services to individual users while providing individual users the flexibility of using phone cards from other than the prospective contractor. "(b) Effective Date. - "(1) Requirement. - Subsection (a)(1) shall apply to any new contract to provide morale, welfare, and recreation telephone services for military personnel serving in combat zones that is entered into after the date of the enactment of this Act [Jan. 28, 2008]. "(2) Review and determination. - Subsection (a)(2) shall apply to any new contract or extension to an existing contract to provide morale, welfare, and recreation telephone services for military personnel serving in combat zones that is entered into or agreed upon after the date of the enactment of this Act. "(c) Morale, Welfare, and Recreation Telephone Services Defined. - In this section, the term 'morale, welfare, and recreation telephone services' means unofficial telephone calling center services supporting calling centers provided by the Army and Air Force Exchange Service, Navy Exchange Service Command, Marine Corps exchanges, or any other nonappropriated fund instrumentality of the United States under the jurisdiction of the Armed Forces which is conducted for the comfort, pleasure, contentment, or physical or mental improvement of members of the Armed Forces." COMPETITION FOR PROCUREMENT OF SMALL ARMS SUPPLIED TO IRAQ AND AFGHANISTAN Pub. L. 110-181, div. A, title VIII, Sec. 892, Jan. 28, 2008, 122 Stat. 270, provided that: "(a) Competition Requirement. - For the procurement of pistols and other weapons described in subsection (b), the Secretary of Defense shall ensure, consistent with the provisions of section 2304 of title 10, United States Code, that - "(1) full and open competition is obtained to the maximum extent practicable; "(2) no responsible United States manufacturer is excluded from competing for such procurements; and "(3) products manufactured in the United States are not excluded from the competition. "(b) Procurements Covered. - This section applies to the procurement of the following: "(1) Pistols and other weapons less than 0.50 caliber for assistance to the Army of Iraq, the Iraqi Police Forces, and other Iraqi security organizations. "(2) Pistols and other weapons less than 0.50 caliber for assistance to the Army of Afghanistan, the Afghani Police Forces, and other Afghani security organizations." INTERNAL CONTROLS FOR PROCUREMENTS ON BEHALF OF THE DEPARTMENT OF DEFENSE Pub. L. 110-417, [div. A], title VIII, Sec. 804(a)-(c), Oct. 14, 2008, 122 Stat. 4519, provided that: "(a) Inclusion of Additional Non-Defense Agencies in Review. - The covered non-defense agencies specified in subsection (c) of this section shall be considered covered non-defense agencies as defined in subsection (i) of section 817 of the John Warner National Defense Authorization Act for Fiscal Year 2007 (Public Law 109-364; 120 Stat. 2326) [set out below] for purposes of such section. "(b) Deadlines and Applicability for Additional Non-Defense Agencies. - For each covered non-defense agency specified in subsection (c) of this section, section 817 of the John Warner National Defense Authorization Act for Fiscal Year 2007 (Public Law 109-364; 120 Stat. 2326) shall apply to such agency as follows: "(1) The review and determination required by subsection (a)(1) of such section shall be completed by not later than March 15, 2009. "(2) The review and determination required by subsection (a)(2) of such section, if necessary, shall be completed by not later than June 15, 2010, and such review and determination shall be a review and determination of such agency's procurement of property and services on behalf of the Department of Defense in fiscal year 2009. "(3) The memorandum of understanding required by subsection (c)(1) of such section shall be entered into by not later than 60 days after the date of the enactment of this Act [Oct. 14, 2008]. "(4) The limitation specified in subsection (d)(1) of such section shall apply after March 15, 2009, and before June 16, 2010. "(5) The limitation specified in subsection (d)(2) of such section shall apply after June 15, 2010. "(6) The limitation required by subsection (d)(3) of such section shall commence, if necessary, on the date that is 60 days after the date of the enactment of this Act. "(c) Definition of Covered Non-Defense Agency. - In this section, the term 'covered non-defense agency' means each of the following: "(1) The Department of Commerce. "(2) The Department of Energy." Pub. L. 110-181, div. A, title VIII, Sec. 801, Jan. 28, 2008, 122 Stat. 202, as amended by Pub. L. 110-417, [div. A], title VIII, Sec. 804(d), Oct. 14, 2008, 122 Stat. 4519; Pub. L. 111-84, div. A, title VIII, Sec. 806, Oct. 28, 2009, 123 Stat. 2404; Pub. L. 112- 81, div. A, title VIII, Sec. 817, Dec. 31, 2011, 125 Stat. 1493, provided that: "(a) Inspectors General Reviews and Determinations. - "(1) In general. - For each covered non-defense agency, the Inspector General of the Department of Defense and the Inspector General of such covered non-defense agency shall, not later than the date specified in paragraph (2), jointly - "(A) review - "(i) the procurement policies, procedures, and internal controls of such covered non-defense agency that are applicable to the procurement of property and services on behalf of the Department by such covered non-defense agency; and "(ii) the administration of such policies, procedures, and internal controls; and "(B) determine in writing whether such covered non-defense agency is or is not compliant with defense procurement requirements. "(2) Deadline for reviews and determinations. - The reviews and determinations required by paragraph (1) shall take place as follows: "(A) In the case of the General Services Administration, by not later than March 15, 2010. "(B) In the case of the Department of the Interior, by not later than March 15, 2011. "(C) In the case of each of the Department of Veterans Affairs and the National Institutes of Health, by not later than March 15, 2012. "(D) In the case of each of the Department of Commerce and the Department of Energy, by not later than March 15, 2015. "(3) Separate reviews and determinations. - The Inspector General of the Department of Defense and the Inspector General of a covered non-defense agency may by joint agreement conduct separate reviews of the procurement of property and services on behalf of the Department of Defense that are conducted by separate business units, or under separate government-wide acquisition contracts, of the covered non-defense agency. If such separate reviews are conducted, the Inspectors General shall make a separate determination under paragraph (1)(B) with respect to each such separate review. "(4) Memoranda of understanding for reviews and determinations. - Not later than one year before a review and determination is required under this subsection with respect to a covered non- defense agency, the Inspector General of the Department of Defense and the Inspector General of the covered non-defense agency shall enter into a memorandum of understanding with each other to carry out such review and determination. "(5) Termination of non-compliance determination. - If the Inspector General of the Department of Defense and the Inspector General of a covered non-defense agency determine, pursuant to paragraph (1)(B), that a covered non-defense agency is not compliant with defense procurement requirements, the Inspectors General shall terminate such a determination effective on the date on which the Inspectors General jointly - "(A) determine that the non-defense agency is compliant with defense procurement requirements; and "(B) notify the Secretary of Defense of that determination. "(6) Resolution of disagreements. - If the Inspector General of the Department of Defense and the Inspector General of a covered non-defense agency are unable to agree on a joint determination under this subsection, a determination by the Inspector General of the Department of Defense under this subsection shall be conclusive for the purposes of this section. "(b) Limitation on Procurements on Behalf of Department of Defense. - "(1) Except as provided in paragraph (2), an acquisition official of the Department of Defense may place an order, make a purchase, or otherwise procure property or services for the Department of Defense in excess of the simplified acquisition threshold through a non-defense agency only if - "(A) in the case of a procurement by any non-defense agency in any fiscal year, the head of the non-defense agency has certified that the non-defense agency will comply with defense procurement requirements for the fiscal year; "(B) in the case of - "(i) a procurement by a covered non-defense agency in a fiscal year for which a memorandum of understanding is required by subsection (a)(4), the Inspector General of the Department of Defense and the Inspector General of the covered non-defense agency have entered into such a memorandum of understanding; or "(ii) a procurement by a covered non-defense agency in a fiscal year following the Inspectors General review and determination required by subsection (a), the Inspectors General have determined that a covered non-defense agency is compliant with defense procurement requirements or have terminated a prior determination of non-compliance in accordance with subsection (a)(5); and "(C) the procurement is not otherwise prohibited by section 817 of the John Warner National Defense Authorization Act for Fiscal Year 2007 (Public Law 109-364) or section 811 of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163) [see notes below]. "(2) Exception for procurements of necessary property and services. - "(A) In general. - The limitation in paragraph (1) shall not apply to the procurement of property and services on behalf of the Department of Defense by a non-defense agency during any fiscal year for which there is in effect a written determination of the Under Secretary of Defense for Acquisition, Technology, and Logistics that it is necessary in the interest of the Department of Defense to procure property and services through the non-defense agency during such fiscal year. "(B) Scope of particular exception. - A written determination with respect to a non-defense agency under subparagraph (A) shall apply to any category of procurements through the non- defense agency that is specified in the determination. "(3) Treatment of procurements under joint programs with intelligence community. - For purposes of this subsection, a contract entered into by a non-defense agency that is an element of the intelligence community (as defined in section 3(4) of the National Security Act of 1947 (50 U.S.C. 401a(4))) for the performance of a joint program conducted to meet the needs of the Department of Defense and the non-defense agency shall not be considered a procurement of property or services for the Department of Defense through a non-defense agency. "(c) Guidance on Interagency Contracting. - "(1) Requirement. - Not later than 180 days after the date of enactment of this Act [Jan. 28, 2008], the Secretary of Defense shall issue guidance on the use of interagency contracting by the Department of Defense. "(2) Matters covered. - The guidance required by paragraph (1) shall address the circumstances in which it is appropriate for Department of Defense acquisition officials to procure goods or services through a contract entered into by an agency outside the Department of Defense. At a minimum, the guidance shall address - "(A) the circumstances in which it is appropriate for such acquisition officials to use direct acquisitions; "(B) the circumstances in which it is appropriate for such acquisition officials to use assisted acquisitions; "(C) the circumstances in which it is appropriate for such acquisition officials to use interagency contracting to acquire items unique to the Department of Defense and the procedures for approving such interagency contracting; "(D) the circumstances in which it is appropriate for such acquisition officials to use interagency contracting to acquire items that are already being provided under a contract awarded by the Department of Defense; "(E) tools that should be used by such acquisition officials to determine whether items are already being provided under a contract awarded by the Department of Defense; and "(F) procedures for ensuring that defense procurement requirements are identified and communicated to outside agencies involved in interagency contracting. "(d) Compliance With Defense Procurement Requirements. - For the purposes of this section, a non-defense agency is compliant with defense procurement requirements if the procurement policies, procedures, and internal controls of the non-defense agency applicable to the procurement of products and services on behalf of the Department of Defense, and the manner in which they are administered, are adequate to ensure the compliance of the non- defense agency with the following: "(1) The Federal Acquisition Regulation and other laws and regulations that apply to procurements of property and services by Federal agencies. "(2) Laws and regulations (including applicable Department of Defense financial management regulations) that apply to procurements of property and services made by the Department of Defense through other Federal agencies. "(e) Treatment of Procurements for Fiscal Year Purposes. - For the purposes of this section, a procurement shall be treated as being made during a particular fiscal year to the extent that funds are obligated by the Department of Defense for the procurement in that fiscal year. "(f) Definitions. - In this section: "(1) Non-defense agency. - The term 'non-defense agency' means any department or agency of the Federal Government other than the Department of Defense. Such term includes a covered non-defense agency. "(2) Covered non-defense agency. - The term 'covered non- defense agency' means each of the following: "(A) The General Services Administration. "(B) The Department of the Interior. "(C) The Department of Veterans Affairs. "(D) The National Institutes of Health. "(E) The Department of Commerce. "(F) The Department of Energy. "(3) Government-wide acquisition contract. - The term 'government-wide acquisition contract' means a task or delivery order contract that - "(A) is entered into by a non-defense agency; and "(B) may be used as the contract under which property or services are procured for one or more other departments or agencies of the Federal Government. "(4) Simplified acquisition threshold. - The term 'simplified acquisition threshold' has the meaning provided by section 2302(7) of title 10, United States Code. "(5) Interagency contracting. - The term 'interagency contracting' means the exercise of the authority under section 1535 of title 31, United States Code, or other statutory authority, for Federal agencies to purchase goods and services under contracts entered into or administered by other agencies. "(6) Acquisition official. - The term 'acquisition official', with respect to the Department of Defense, means - "(A) a contracting officer of the Department of Defense; or "(B) any other Department of Defense official authorized to approve a direct acquisition or an assisted acquisition on behalf of the Department of Defense. "(7) Direct acquisition. - The term 'direct acquisition', with respect to the Department of Defense, means the type of interagency contracting through which the Department of Defense orders an item or service from a government-wide acquisition contract maintained by a non-defense agency. "(8) Assisted acquisition. - The term 'assisted acquisition', with respect to the Department of Defense, means the type of interagency contracting through which acquisition officials of a non-defense agency award a contract or task or delivery order for the procurement of goods or services on behalf of the Department of Defense." Pub. L. 109-364, div. A, title VIII, Sec. 817, Oct. 17, 2006, 120 Stat. 2326, provided that: "(a) Inspector General Reviews and Determinations. - "(1) In general. - For each covered non-defense agency, the Inspector General of the Department of Defense and the Inspector General of such non-defense agency shall, not later than March 15, 2007, jointly - "(A) review - "(i) the procurement policies, procedures, and internal controls of such non-defense agency that are applicable to the procurement of property and services on behalf of the Department by such non-defense agency; and "(ii) the administration of those policies, procedures, and internal controls; and "(B) determine in writing whether - "(i) such non-defense agency is compliant with defense procurement requirements; "(ii) such non-defense agency is not compliant with defense procurement requirements, but has a program or initiative to significantly improve compliance with defense procurement requirements; "(iii) neither of the conclusions stated in clauses (i) and (ii) is correct in the case of such non-defense agency; or "(iv) such non-defense agency is not compliant with defense procurement requirements to such an extent that the interests of the Department of Defense are at risk in procurements conducted by such non-defense agency. "(2) Actions following certain determinations. - If the Inspectors General determine under paragraph (1) that a conclusion stated in clause (ii), (iii), or (iv) of subparagraph (B) of that paragraph is correct in the case of a covered non- defense agency, such Inspectors General shall, not later than June 15, 2008, jointly - "(A) conduct a second review, as described in subparagraph (A) of that paragraph, regarding such non-defense agency's procurement of property or services on behalf of the Department of Defense in fiscal year 2007; and "(B) determine in writing whether such non-defense agency is or is not compliant with defense procurement requirements. "(b) Compliance With Defense Procurement Requirements. - For the purposes of this section, a covered non-defense agency is compliant with defense procurement requirements if such non-defense agency's procurement policies, procedures, and internal controls applicable to the procurement of products and services on behalf of the Department of Defense, and the manner in which they are administered, are adequate to ensure such non-defense agency's compliance with the requirements of laws and regulations that apply to procurements of property and services made directly by the Department of Defense. "(c) Memoranda of Understanding Between Inspectors General. - "(1) In general. - Not later than 60 days after the date of the enactment of this Act [Oct. 17, 2006], the Inspector General of the Department of Defense and the Inspector General of each covered non-defense agency shall enter into a memorandum of understanding with each other to carry out the reviews and make the determinations required by this section. "(2) Scope of memoranda. - The Inspector General of the Department of Defense and the Inspector General of a covered non- defense agency may by mutual agreement conduct separate reviews of the procurement of property and services on behalf of the Department of Defense that are conducted by separate business units, or under separate governmentwide acquisition contracts, of such non-defense agency. In any case where such separate reviews are conducted, the Inspectors General shall make separate determinations under paragraph (1) or (2) of subsection (a), as applicable, with respect to each such separate review. "(d) Limitations on Procurements on Behalf of Department of Defense. - "(1) Limitation during review period. - After March 15, 2007, and before June 16, 2008, no official of the Department of Defense may, except as provided in subsection (e) or (f), order, purchase, or otherwise procure property or services in an amount in excess of $100,000 through a covered non-defense agency for which a determination described in clause (iii) or (iv) of paragraph (1)(B) of subsection (a) has been made under subsection (a). "(2) Limitation after review period. - After June 15, 2008, no official of the Department of Defense may, except as provided in subsection (e) or (f), order, purchase, or otherwise procure property or services in an amount in excess of $100,000 through a covered non-defense agency that, having been subject to review under this section, has not been determined under this section as being compliant with defense procurement requirements. "(3) Limitation following failure to reach mou. - Commencing on the date that is 60 days after the date of the enactment of this Act [Oct. 17, 2006], if a memorandum of understanding between the Inspector General of the Department of Defense and the Inspector General of a covered non-defense agency cannot be attained causing the review required by this section to not be performed, no official of the Department of Defense, except as provided in subsection (e) or (f), may order, purchase or otherwise procure property or services in an amount in excess of $100,000 through such non-defense agency. "(e) Exception From Applicability of Limitations. - "(1) Exception. - No limitation applies under subsection (d) with respect to the procurement of property and services on behalf of the Department of Defense by a covered non-defense agency during any period that there is in effect a determination of the Under Secretary of Defense for Acquisition, Technology, and Logistics, made in writing, that it is necessary in the interest of the Department of Defense to continue to procure property and services through such non-defense agency. "(2) Applicability of determination. - A written determination with respect to a covered non-defense agency under paragraph (1) is in effect for the period, not in excess of one year, that the Under Secretary shall specify in the written determination. The Under Secretary may extend from time to time, for up to one year at a time, the period for which the written determination remains in effect. "(f) Termination of Applicability of Limitations. - Subsection (d) shall cease to apply to a covered non-defense agency on the date on which the Inspector General of the Department of Defense and the Inspector General of such non-defense agency jointly - "(1) determine that such non-defense agency is compliant with defense procurement requirements; and "(2) notify the Secretary of Defense of that determination. "(g) Identification of Procurements Made During a Particular Fiscal Year. - For the purposes of subsection (a), a procurement shall be treated as being made during a particular fiscal year to the extent that funds are obligated by the Department of Defense for that procurement in that fiscal year. "(h) Resolution of Disagreements. - If the Inspector General of the Department of Defense and the Inspector General of a covered non-defense agency are unable to agree on a joint determination under subsection (a) or (f), a determination by the Inspector General of the Department of Defense under such subsection shall be conclusive for the purposes of this section. "(i) Definitions. - In this section: "(1) The term 'covered non-defense agency' means each of the following: "(A) The Department of Veterans Affairs. "(B) The National Institutes of Health. "(2) The term 'governmentwide acquisition contract', with respect to a covered non-defense agency, means a task or delivery order contract that - "(A) is entered into by the non-defense agency; and "(B) may be used as the contract under which property or services are procured for one or more other departments or agencies of the Federal Government." Pub. L. 109-163, div. A, title VIII, Sec. 811, Jan. 6, 2006, 119 Stat. 3374, provided that: "(a) Inspector General Reviews and Determinations. - "(1) In general. - For each covered non-defense agency, the Inspector General of the Department of Defense and the Inspector General of such non-defense agency shall, not later than March 15, 2006, jointly - "(A) review - "(i) the procurement policies, procedures, and internal controls of such non-defense agency that are applicable to the procurement of property and services on behalf of the Department by such non-defense agency; and "(ii) the administration of those policies, procedures, and internal controls; and "(B) determine in writing whether - "(i) such non-defense agency is compliant with defense procurement requirements; "(ii) such non-defense agency is not compliant with defense procurement requirements, but has a program or initiative to significantly improve compliance with defense procurement requirements; or "(iii) neither of the conclusions stated in clauses (i) and (ii) is correct in the case of such non-defense agency. "(2) Actions following certain determinations. - If the Inspectors General determine under paragraph (1) that the conclusion stated in clause (ii) or (iii) of subparagraph (B) of that paragraph is correct in the case of a covered non-defense agency, such Inspectors General shall, not later than June 15, 2007, jointly - "(A) conduct a second review, as described in subparagraph (A) of that paragraph, regarding such non-defense agency's procurement of property or services on behalf of the Department of Defense in fiscal year 2006; and "(B) determine in writing whether such non-defense agency is or is not compliant with defense procurement requirements. "(b) Compliance With Defense Procurement Requirements. - For the purposes of this section, a covered non-defense agency is compliant with defense procurement requirements if such non-defense agency's procurement policies, procedures, and internal controls applicable to the procurement of products and services on behalf of the Department of Defense, and the manner in which they are administered, are adequate to ensure such non-defense agency's compliance with the requirements of laws and regulations that apply to procurements of property and services made directly by the Department of Defense. "(c) Memoranda of Understanding Between Inspectors General. - "(1) In general. - Not later than 60 days after the date of the enactment of this Act [Jan. 6, 2006], the Inspector General of the Department of Defense and the Inspector General of each covered non-defense agency shall enter into a memorandum of understanding with each other to carry out the reviews and make the determinations required by this section. "(2) Scope of memoranda. - The Inspector General of the Department of Defense and the Inspector General of a covered non- defense agency may by mutual agreement conduct separate reviews of the procurement of property and services on behalf of the Department of Defense that are conducted by separate business units, or under separate governmentwide acquisition contracts, of such non-defense agency. In any case where such separate reviews are conducted, the Inspectors General shall make separate determinations under paragraph (1) or (2) of subsection (a), as applicable, with respect to each such separate review. "(d) Limitations on Procurements on Behalf of Department of Defense. - "(1) Limitation during review period. - After March 15, 2006, and before June 16, 2007, no official of the Department of Defense may, except as provided in subsection (e) or (f), order, purchase, or otherwise procure property or services in an amount in excess of $100,000 through a covered non-defense agency for which a determination described in paragraph (1)(B)(iii) of subsection (a) has been made under that subsection. "(2) Limitation after review period. - After June 15, 2007, no official of the Department of Defense may, except as provided in subsection (e) or (f), order, purchase, or otherwise procure property or services in an amount in excess of $100,000 through a covered non-defense agency that, having been subject to review under this section, has not been determined under this section as being compliant with defense procurement requirements. "(3) Limitation following failure to reach mou. - Commencing on the date that is 60 days after the date of the enactment of this Act [Jan. 6, 2006], if a memorandum of understanding between the Inspector General of the Department of Defense and the Inspector General of a covered non-defense agency cannot be attained causing the review required by this section to not be performed, no official of the Department of Defense, except as provided in subsection (e) or (f), may order, purchase or otherwise procure property or services in an amount in excess of $100,000 through such non-defense agency. "(e) Exception From Applicability of Limitations. - "(1) Exception. - No limitation applies under subsection (d) with respect to the procurement of property and services on behalf of the Department of Defense by a covered non-defense agency during any period that there is in effect a determination of the Under Secretary of Defense for Acquisition, Technology, and Logistics, made in writing, that it is necessary in the interest of the Department of Defense to continue to procure property and services through such non-defense agency. "(2) Applicability of determination. - A written determination with respect to a covered non-defense agency under paragraph (1) is in effect for the period, not in excess of one year, that the Under Secretary shall specify in the written determination. The Under Secretary may extend from time to time, for up to one year at a time, the period for which the written determination remains in effect. "(f) Termination of Applicability of Limitations. - Subsection (d) shall cease to apply to a covered non-defense agency on the date on which the Inspector General of the Department of Defense and the Inspector General of such non-defense agency jointly - "(1) determine that such non-defense agency is compliant with defense procurement requirements; and "(2) notify the Secretary of Defense of that determination. "(g) Identification of Procurements Made During a Particular Fiscal Year. - For the purposes of subsection (a), a procurement shall be treated as being made during a particular fiscal year to the extent that funds are obligated by the Department of Defense for that procurement in that fiscal year. "(h) Definitions. - In this section: "(1) The term 'covered non-defense agency' means each of the following: "(A) The Department of the Treasury. "(B) The Department of the Interior. "(C) The National Aeronautics and Space Administration. "(2) The term 'governmentwide acquisition contract', with respect to a covered non-defense agency, means a task or delivery order contract that - "(A) is entered into by the non-defense agency; and "(B) may be used as the contract under which property or services are procured for 1 or more other departments or agencies of the Federal Government." PANEL ON CONTRACTING INTEGRITY Pub. L. 109-364, div. A, title VIII, Sec. 813, Oct. 17, 2006, 120 Stat. 2320, as amended by Pub. L. 111-23, title II, Sec. 207(d), May 22, 2009, 123 Stat. 1730, provided that: "(a) Establishment. - "(1) In general. - The Secretary of Defense shall establish a panel to be known as the 'Panel on Contracting Integrity'. "(2) Composition. - The panel shall be composed of the following: "(A) A representative of the Under Secretary of Defense for Acquisition, Technology, and Logistics, who shall be the chairman of the panel. "(B) A representative of the service acquisition executive of each military department. "(C) A representative of the Inspector General of the Department of Defense. "(D) A representative of the Inspector General of each military department. "(E) A representative of each Defense Agency involved with contracting, as determined appropriate by the Secretary of Defense. "(F) Such other representatives as may be determined appropriate by the Secretary of Defense. "(b) Duties. - In addition to other matters assigned to it by the Secretary of Defense, the panel shall - "(1) conduct reviews of progress made by the Department of Defense to eliminate areas of vulnerability of the defense contracting system that allow fraud, waste, and abuse to occur; "(2) review the report by the Comptroller General required by section 841 of the National Defense Authorization Act for Fiscal Year 2006 (Public Law 109-163; 119 Stat. 3389), relating to areas of vulnerability of Department of Defense contracts to fraud, waste, and abuse; and "(3) recommend changes in law, regulations, and policy that it determines necessary to eliminate such areas of vulnerability. "(c) Meetings. - The panel shall meet as determined necessary by the Secretary of Defense but not less often than once every six months. "(d) Report. - "(1) Requirement. - The panel shall prepare and submit to the Secretary of Defense and the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] an annual report on its activities. The report shall be submitted not later than December 31 of each year and contain a summary of the panel's findings and recommendations for the year covered by the report. "(2) First report. - The first report under this subsection shall be submitted not later than December 31, 2007, and shall contain an examination of the current structure in the Department of Defense for contracting integrity and recommendations for any changes needed to the system of administrative safeguards and disciplinary actions to ensure accountability at the appropriate level for any violations of appropriate standards of behavior in contracting. "(3) Interim reports. - The panel may submit such interim reports to the congressional defense committees as the Secretary of Defense considers appropriate. "(e) Termination. - "(1) In general. - Subject to paragraph (2), the panel shall continue to serve until the date that is 18 months after the date on which the Secretary of Defense notifies the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] of an intention to terminate the panel based on a determination that the activities of the panel no longer justify its continuation and that concerns about contracting integrity have been mitigated. "(2) Minimum continuing service. - The panel shall continue to serve at least until December 31, 2011." EMPLOYMENT OF STATE RESIDENTS IN STATES HAVING UNEMPLOYMENT RATE IN EXCESS OF NATIONAL AVERAGE Pub. L. 109-289, div. A, title VIII, Sec. 8048, Sept. 29, 2006, 120 Stat. 1284, provided that: "Notwithstanding any other provision of law, each contract awarded by the Department of Defense during the current fiscal year and hereafter for construction or service performed in whole or in part in a State (as defined in section 381(d) of title 10, United States Code) which is not contiguous with another State and has an unemployment rate in excess of the national average rate of unemployment as determined by the Secretary of Labor, shall include a provision requiring the contractor to employ, for the purpose of performing that portion of the contract in such State that is not contiguous with another State, individuals who are residents of such State and who, in the case of any craft or trade, possess or would be able to acquire promptly the necessary skills: Provided, That the Secretary of Defense may waive the requirements of this section, on a case-by- case basis, in the interest of national security." REVIEW AND DEMONSTRATION PROJECT RELATING TO CONTRACTOR EMPLOYEES Pub. L. 108-375, div. A, title VIII, Sec. 851, Oct. 28, 2004, 118 Stat. 2019, provided that: "(a) General Review. - (1) The Secretary of Defense shall conduct a review of policies, procedures, practices, and penalties of the Department of Defense relating to employees of defense contractors for purposes of ensuring that the Department of Defense is in compliance with Executive Order No. 12989 [8 U.S.C. 1324a note] (relating to a prohibition on entering into contracts with contractors that are not in compliance with the Immigration and Nationality Act [8 U.S.C. 1101 et seq.]). "(2) In conducting the review, the Secretary shall - "(A) identify potential weaknesses and areas for improvement in existing policies, procedures, practices, and penalties; "(B) develop and implement reforms to strengthen, upgrade, and improve policies, procedures, practices, and penalties of the Department of Defense and its contractors; and "(C) review and analyze reforms developed pursuant to this paragraph to identify for purposes of national implementation those which are most efficient and effective. "(3) The review under this subsection shall be completed not later than 180 days after the date of the enactment of this Act [Oct. 28, 2004]. "(b) Demonstration Project. - The Secretary of Defense shall conduct a demonstration project in accordance with this section, in one or more regions selected by the Secretary, for purposes of promoting greater contracting opportunities for contractors offering effective, reliable staffing plans to perform defense contracts that ensure all contract personnel employed for such projects, including management employees, professional employees, craft labor personnel, and administrative personnel, are lawful residents or persons properly authorized to be employed in the United States and properly qualified to perform services required under the contract. The demonstration project shall focus on contracts for construction, renovation, maintenance, and repair services for military installations. "(c) Demonstration Project Procurement Procedures. - As part of the demonstration project under subsection (b), the Secretary of Defense may conduct a competition in which there is a provision in contract solicitations and request for proposal documents to require significant weight or credit be allocated to - "(1) reliable, effective workforce programs offered by prospective contractors that provide background checks and other measures to ensure the contractor is in compliance with the Immigration and Nationality Act; and "(2) reliable, effective project staffing plans offered by prospective contractors that specify for all contract employees (including management employees, professionals, and craft labor personnel) the skills, training, and qualifications of such persons and the labor supply sources and hiring plans or procedures used for employing such persons. "(d) Implementation of Demonstration Project. - The Secretary of Defense shall begin operation of the demonstration project required under this section after completion of the review under subsection (a), but in no event later than 270 days after the date of the enactment of this Act. "(e) Report on Demonstration Project. - Not later than six months after award of a contract under the demonstration project, the Secretary of Defense shall submit to the Committees on Armed Services of the Senate and House of Representatives a report setting forth a review of the demonstration project and recommendations on the actions, if any, that can be implemented to ensure compliance by the Department of Defense with Executive Order No. 12989. "(f) Definition. - In this section, the term 'military installation' means a base, camp, post, station, yard, center, homeport facility for any ship, or other activity under the jurisdiction of the Department of Defense, including any leased facility, which is located within any of the several States, the District of Columbia, the Commonwealth of Puerto Rico, American Samoa, the Virgin Islands, or Guam. Such term does not include any facility used primarily for civil works, rivers and harbors projects, or flood control projects." DEFENSE PROCUREMENTS MADE THROUGH CONTRACTS OF OTHER AGENCIES Pub. L. 108-375, div. A, title VIII, Sec. 854, Oct. 28, 2004, 118 Stat. 2022, provided that: "(a) Limitation. - The head of an agency may not procure goods or services (under section 1535 of title 31, United States Code, pursuant to a designation under section 11302(e) of title 40, United States Code, or otherwise) through a contract entered into by an agency outside the Department of Defense for an amount greater than the simplified acquisition threshold referred to in section 2304(g) of title 10, United States Code, unless the procurement is done in accordance with procedures prescribed by that head of an agency for reviewing and approving the use of such contracts. "(b) Effective Date. - The limitation in subsection (a) shall apply only with respect to orders for goods or services that are issued by the head of an agency to an agency outside the Department of Defense on or after the date that is 180 days after the date of the enactment of this Act [Oct. 28, 2004]. "(c) Inapplicability to Contracts for Certain Services. - This section does not apply to procurements of the following services: "(1) Printing, binding, or blank-book work to which section 502 of title 44, United States Code, applies. "(2) Services available under programs pursuant to section 103 of the Library of Congress Fiscal Operations Improvement Act of 2000 (Public Law 106-481; 114 Stat. 2187; 2 U.S.C. 182c). "(d) Annual Report. - (1) For each of fiscal years 2005 and 2006, each head of an agency shall submit to the Secretary of Defense a report on the service charges imposed on purchases made for an amount greater than the simplified acquisition threshold during such fiscal year through a contract entered into by an agency outside the Department of Defense. "(2) In the case of procurements made on orders issued by the head of a Defense Agency, Department of Defense Field Activity, or any other organization within the Department of Defense (other than a military department) under the authority of the Secretary of Defense as the head of an agency, the report under paragraph (1) shall be submitted by the head of that Defense Agency, Department of Defense Field Activity, or other organization, respectively. "(3) The report for a fiscal year under this subsection shall be submitted not later than December 31 of the calendar year in which such fiscal year ends. "(e) Definitions. - In this section: "(1) The term 'head of an agency' means the Secretary of Defense, the Secretary of the Army, the Secretary of the Navy, the Secretary of the Air Force. "(2) The term 'Defense Agency' has the meaning given such term in section 101(a)(11) of title 10, United States Code. "(3) The term 'Department of Defense Field Activity' has the meaning given such term in section 101(a)(12) of such title." RESOURCES-BASED SCHEDULES FOR COMPLETION OF PUBLIC-PRIVATE COMPETITIONS FOR PERFORMANCE OF DEPARTMENT OF DEFENSE FUNCTIONS Pub. L. 108-136, div. A, title III, Sec. 334, Nov. 24, 2003, 117 Stat. 1443, provided that: "(a) Application of Timeframes. - Any interim or final deadline or other schedule-related milestone for the completion of a Department of Defense public-private competition shall be established solely on the basis of considered research and sound analysis regarding the availability of sufficient personnel, training, and technical resources to the Department of Defense to carry out such competition in a timely manner. "(b) Extension of Timeframes. - (1) The Department of Defense official responsible for managing a Department of Defense public- private competition shall extend any interim or final deadline or other schedule-related milestone established (consistent with subsection (a)) for the completion of the competition if the official determines that the personnel, training, or technical resources available to the Department of Defense to carry out the competition in a timely manner are insufficient. "(2) A determination under this subsection shall be made pursuant to procedures prescribed by the Secretary of Defense." COMPETITION REQUIREMENT FOR PURCHASE OF SERVICES PURSUANT TO MULTIPLE AWARD CONTRACTS Pub. L. 107-107, div. A, title VIII, Sec. 803, Dec. 28, 2001, 115 Stat. 1178, which required the Secretary of Defense to promulgate in the Department of Defense Supplement to the Federal Acquisition Regulation, not later than 180 days after Dec. 28, 2001, regulations requiring competition in the purchase of services by the Department of Defense pursuant to multiple award contracts, was repealed by Pub. L. 110-417, [div. A], title VIII, Sec. 863(f), Oct. 14, 2008, 122 Stat. 4548. REQUIREMENT TO DISREGARD CERTAIN AGREEMENTS IN AWARDING CONTRACTS FOR PURCHASE OF FIREARMS OR AMMUNITION Pub. L. 106-398, Sec. 1 [[div. A], title VIII, Sec. 826], Oct. 30, 2000, 114 Stat. 1654, 1654A-220, provided that: "In accordance with the requirements contained in the amendments enacted in the Competition in Contracting Act of 1984 (title VII of division B of Public Law 98-369; 98 Stat. 1175) [see Tables for classification], the Secretary of Defense may not, in awarding a contract for the purchase of firearms or ammunition, take into account whether a manufacturer or vendor of firearms or ammunition is a party to an agreement under which the manufacturer or vendor agrees to adopt limitations with respect to importing, manufacturing, or dealing in firearms or ammunition in the commercial market." GAO REPORT Pub. L. 106-65, div. A, title VIII, Sec. 806(b), Oct. 5, 1999, 113 Stat. 705, directed the Comptroller General, not later than Mar. 1, 2001, to submit to Congress an evaluation of the test program authorized by the provisions in Pub. L. 104-106, Sec. 4202 (amending this section and section 2305 of this title and sections 253, 253a, 416, and 427 of Title 41, Public Contracts, and enacting provisions set out as a note below), together with any recommendations that the Comptroller General considered appropriate regarding the test program or the use of special simplified procedures for purchases of commercial items in excess of the simplified acquisition threshold. PROCUREMENT OF CONVENTIONAL AMMUNITION Pub. L. 105-261, div. A, title VIII, Sec. 806, Oct. 17, 1998, 112 Stat. 2084, provided that: "(a) Authority. - The official in the Department of Defense designated as the single manager for conventional ammunition in the Department shall have the authority to restrict the procurement of conventional ammunition to sources within the national technology and industrial base in accordance with the authority in section 2304(c) of title 10, United States Code. "(b) Requirement. - The official in the Department of Defense designated as the single manager for conventional ammunition in the Department of Defense shall limit a specific procurement of ammunition to sources within the national technology and industrial base in accordance with section 2304(c)(3) of title 10, United States Code, in any case in which that manager determines that such limitation is necessary to maintain a facility, producer, manufacturer, or other supplier available for furnishing an essential item of ammunition or ammunition component in cases of national emergency or to achieve industrial mobilization. "(c) Conventional Ammunition Defined. - For purposes of this section, the term 'conventional ammunition' has the meaning given that term in Department of Defense Directive 5160.65, dated March 8, 1995." WARRANTY CLAIMS RECOVERY PILOT PROGRAM Pub. L. 105-85, div. A, title III, Sec. 391, Nov. 18, 1997, 111 Stat. 1716, as amended by Pub. L. 106-65, div. A, title III, Sec. 382, Oct. 5, 1999, 113 Stat. 583; Pub. L. 107-107, div. A, title III, Sec. 364, Dec. 28, 2001, 115 Stat. 1068; Pub. L. 107-314, div. A, title III, Sec. 368, Dec. 2, 2002, 116 Stat. 2524; Pub. L. 108- 375, div. A, title III, Sec. 343, Oct. 28, 2004, 118 Stat. 1857, provided that: "(a) Pilot Program Required. - The Secretary of Defense may carry out a pilot program to use commercial sources of services to improve the collection of Department of Defense claims under aircraft engine warranties. "(b) Contracts. - Exercising the authority provided in section 3718 of title 31, United States Code, the Secretary of Defense may enter into contracts under the pilot program to provide for the following services: "(1) Collection services. "(2) Determination of amounts owed the Department of Defense for repair of aircraft engines for conditions covered by warranties. "(3) Identification and location of the sources of information that are relevant to collection of Department of Defense claims under aircraft engine warranties, including electronic data bases and document filing systems maintained by the Department of Defense or by the manufacturers and suppliers of the aircraft engines. "(4) Services to define the elements necessary for an effective training program to enhance and improve the performance of Department of Defense personnel in collecting and organizing documents and other information that are necessary for efficient filing, processing, and collection of Department of Defense claims under aircraft engine warranties. "(c) Contractor Fee. - Under the authority provided in section 3718(d) of title 31, United States Code, a contract entered into under the pilot program shall provide for the contractor to be paid, out of the amount recovered by the contractor under the program, such percentages of the amount recovered as the Secretary of Defense determines appropriate. "(d) Retention of Recovered Funds. - Subject to any obligation to pay a fee under subsection (c), any amount collected for the Department of Defense under the pilot program for a repair of an aircraft engine for a condition covered by a warranty shall be credited to an appropriation available for repair of aircraft engines for the fiscal year in which collected and shall be available for the same purposes and same period as the appropriation to which credited. "(e) Regulations. - The Secretary of Defense shall prescribe regulations to carry out this section. "(f) Termination of Authority. - The pilot program shall terminate on September 30, 2006, and contracts entered into under this section shall terminate not later than that date. "(g) Reporting Requirement. - Not later than February 1, 2006, the Secretary of Defense shall submit to Congress a report on the pilot program, including - "(1) a description of the extent to which commercial firms have been used to provide the services specified in subsection (b) and the type of services procured; "(2) a description of any problems that have limited the ability of the Secretary to utilize the pilot program to procure such services; and "(3) the recommendation of the Secretary regarding whether the pilot program should be made permanent or extended beyond September 30, 2006." REQUIREMENTS RELATING TO MICRO-PURCHASES Pub. L. 105-85, div. A, title VIII, Sec. 848, Nov. 18, 1997, 111 Stat. 1846, provided that: "(a) Requirement. - (1) Not later than October 1, 1998, at least 60 percent of all eligible purchases made by the Department of Defense for an amount less than the micro-purchase threshold shall be made through streamlined micro-purchase procedures. "(2) Not later than October 1, 2000, at least 90 percent of all eligible purchases made by the Department of Defense for an amount less than the micro-purchase threshold shall be made through streamlined micro-purchase procedures. "(b) Eligible Purchases. - The Secretary of Defense shall establish which purchases are eligible for purposes of subsection (a). In establishing which purchases are eligible, the Secretary may exclude those categories of purchases determined not to be appropriate or practicable for streamlined micro-purchase procedures. "(c) Plan. - Not later than March 1, 1998, the Secretary of Defense shall provide to the Committee on Armed Services of the Senate and the Committee on National Security of the House of Representatives a plan to implement this section. "(d) Report. - Not later than March 1 in each of the years 1999, 2000, and 2001, the Secretary of Defense shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of Senate and House of Representatives] a report on the implementation of this section. Each report shall include - "(A) the total dollar amount of all Department of Defense purchases for an amount less than the micro-purchase threshold in the fiscal year preceding the year in which the report is submitted; "(B) the total dollar amount of such purchases that were considered to be eligible purchases; "(C) the total amount of such eligible purchases that were made through a streamlined micro-purchase method; and "(D) a description of the categories of purchases excluded from the definition of eligible purchases established under subsection (b). "(e) Definitions. - In this section: "(1) The term 'micro-purchase threshold' has the meaning provided in section 32 of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 428) [now 41 U.S.C. 1902]. "(2) The term 'streamlined micro-purchase procedures' means procedures providing for the use of the Government-wide commercial purchase card or any other method for carrying out micro-purchases that the Secretary of Defense prescribes in the regulations implementing this subsection." TERMINATION OF AUTHORITY TO ISSUE SOLICITATIONS FOR PURCHASES OF COMMERCIAL ITEMS IN EXCESS OF SIMPLIFIED ACQUISITION THRESHOLD Pub. L. 104-106, div. D, title XLII, Sec. 4202(e), Feb. 10, 1996, 110 Stat. 654, as amended by Pub. L. 106-65, div. A, title VIII, Sec. 806(a), Oct. 5, 1999, 113 Stat. 705; Pub. L. 107-107, div. A, title VIII, Sec. 823, Dec. 28, 2001, 115 Stat. 1183; Pub. L. 107- 314, div. A, title VIII, Sec. 812(a), Dec. 2, 2002, 116 Stat. 2609; Pub. L. 108-136, div. A, title XIV, Sec. 1443(b), Nov. 24, 2003, 117 Stat. 1676; Pub. L. 108-375, div. A, title VIII, Sec. 817, Oct. 28, 2004, 118 Stat. 2015; Pub. L. 110-181, div. A, title VIII, Sec. 822(a), Jan. 28, 2008, 122 Stat. 226; Pub. L. 111-84, div. A, title VIII, Sec. 816, Oct. 28, 2009, 123 Stat. 2408, provided that: "The authority to issue solicitations for purchases of commercial items in excess of the simplified acquisition threshold pursuant to the special simplified procedures authorized by section 2304(g)(1) of title 10, United States Code, section 303(g)(1) of the Federal Property and Administrative Services Act of 1949 [now 41 U.S.C. 3305(a)], and section 31(a) of the Office of Federal Procurement Policy Act [now 41 U.S.C. 1901(a)], as amended by this section, shall expire January 1, 2012. Contracts may be awarded pursuant to solicitations that have been issued before such authority expires, notwithstanding the expiration of such authority." REFERENCES IN OTHER LAWS TO GS-16, 17, OR 18 PAY RATES References in laws to the rates of pay for GS-16, 17, or 18, or to maximum rates of pay under the General Schedule, to be considered references to rates payable under specified sections of Title 5, Government Organization and Employees, see section 529 [title I, Sec. 101(c)(1)] of Pub. L. 101-509, set out in a note under section 5376 of Title 5. AUTHORITY OF BASE COMMANDERS OVER CONTRACTING FOR COMMERCIAL ACTIVITIES Pub. L. 100-180, div. A, title XI, Sec. 1111, Dec. 4, 1987, 101 Stat. 1146, directed the Secretary of Defense to authorize the commander of each military installation to (1) prepare an inventory each fiscal year of commercial activities carried out by Government personnel on the military installation, (2) decide which commercial activities were to be reviewed pursuant to Office of Management and Budget Circular A-76 or any successor administrative regulation or policy, (3) conduct a solicitation for contracts for those commercial activities selected for conversion to contractor performance under the Circular A-76 process, and (4) assist in finding suitable employment for any employee of the Department of Defense who had been displaced because of a contract entered into with a contractor for performance of a commercial activity on the military installation; directed the Secretary to prescribe regulations required by the preceding authority no later than 60 days after Dec. 4, 1987; and provided for termination of the authority on Oct. 1, 1989. EVALUATION OF CONTRACTS FOR PROFESSIONAL AND TECHNICAL SERVICES Section 804 of Pub. L. 100-456, as amended by Pub. L. 103-160, div. A, title IX, Sec. 904(f), Nov. 30, 1993, 107 Stat. 1729, directed Secretary of Defense, within 120 days after Sept. 29, 1988, to establish criteria to ensure that proposals for contracts for professional and technical services be evaluated on a basis which does not encourage contractors to propose mandatory uncompensated overtime for professional and technical employees and, within 30 days after Sept. 29, 1988, to establish an advisory committee to make recommendations on the criteria. REGULATIONS ON USE OF FIXED-PRICE DEVELOPMENT CONTRACTS Pub. L. 100-456, div. A, title VIII, Sec. 807, Sept. 29, 1988, 102 Stat. 2011, as amended by Pub. L. 103-160, div. A, title IX, Sec. 904(f), Nov. 30, 1993, 107 Stat. 1729, which provided that not later than 120 days after Sept. 29, 1988, the Secretary of Defense was to make certain revisions to Department of Defense regulations that provide for the use of fixed-price type contracts in a development program, was repealed by Pub. L. 109-364, div. A, title VIII, Sec. 818(a), Oct. 17, 2006, 120 Stat. 2329. PROHIBITION OF PURCHASE OF ANGOLAN PETROLEUM PRODUCTS FROM COMPANIES PRODUCING OIL IN ANGOLA Section 842 of Pub. L. 102-484 provided that: "The prohibition in section 316 of the National Defense Authorization Act for Fiscal Year 1987 [Pub. L. 99-661] (100 Stat. 3855; 10 U.S.C. 2304 note) shall cease to be effective on the date on which the President certifies to Congress that free, fair, and democratic elections have taken place in Angola." Determination of President of the United States, No. 93-32, July 19, 1993, 58 F.R. 40309, provided: Pursuant to the authority vested in me by Public Law 102-484, section 842 [set out as a note above], I hereby certify that free, fair, and democratic elections have taken place in Angola. You are authorized and directed to report this determination to the Congress and publish it in the Federal Register. William J. Clinton. Section 316 of Pub. L. 99-661 provided that: "(a) General Rule. - The Secretary of Defense may not enter into a contract with a company for the purchase of petroleum products which originated in Angola if the company (or a subsidiary or partnership of the company) is engaged in the production of petroleum products in Angola. "(b) Waiver Authority. - The Secretary of Defense may waive the limitation in subsection (a) if the Secretary determines that such action is in the best interest of the United States. "(c) Petroleum Product Defined. - For purposes of this section, the term 'petroleum product' means - "(1) natural or synthetic crude; "(2) blends of natural or synthetic crude; and "(3) products refined or derived from natural or synthetic crude or from such blends. "(d) Effective Date. - This section shall take effect six months after the date of the enactment of this Act [Nov. 14, 1986]." DEADLINE FOR PRESCRIBING REGULATIONS Section 101(c) [title X, Sec. 927(b)] of Pub. L. 99-500 and Pub. L. 99-591, and section 927(b) of title IX, formerly title IV, of Pub. L. 99-661, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, provided that: "The Secretary of Defense shall prescribe the regulations required by section 2304(i) of such title (as added by subsection (a)) not later than 180 days after the date of the enactment of this Act [Oct. 18, 1986]." ONE-YEAR SECURITY-GUARD PROHIBITION Section 1222(b) of Pub. L. 99-661 provided that: "(1) Except as provided in paragraph (2), funds appropriated to the Department of Defense may not be obligated or expended before October 1, 1987, for the purpose of entering into a contract for the performance of security-guard functions at any military installation or facility. "(2) The prohibition in paragraph (1) does not apply - "(A) to a contract to be carried out at a location outside the United States (including its commonwealths, territories, and possessions) at which military personnel would have to be used for the performance of the function described in paragraph (1) at the expense of unit readiness; "(B) to a contract to be carried out on a Government-owned but privately operated installation; "(C) to a contract (or the renewal of a contract) for the performance of a function under contract on September 24, 1983; or "(D) to a contract for the performance of security-guard functions if (i) the requirement for the functions arises after the date of the enactment of this Act [Nov. 14, 1986], and (ii) the Secretary of Defense determines the functions can be performed by contractor personnel without adversely affecting installation security, safety, or readiness." CONTRACTING OUT PERFORMANCE OF DEPARTMENT OF DEFENSE SUPPLY AND SERVICE FUNCTIONS Section 1223 of Pub. L. 99-661, which required Secretary to contract for Department of Defense supplies and services from private sector after a cost comparison demonstrates lower cost than Department of Defense can provide, and to ensure that overhead costs considered are realistic and fair, was repealed and restated in section 2462 of this title by Pub. L. 100-370, Sec. 2(a)(1), (c)(3), July 19, 1988, 102 Stat. 853, 854. REPORTS ON SAVINGS OR COSTS FROM INCREASED USE OF CIVILIAN PERSONNEL Section 1224 of Pub. L. 99-661, which required Secretary to maintain cost comparison data on performance of a commercial or industrial type activity taken over by Department of Defense comparing performance by employees of private contractor to that of civilian employees of Department of Defense, and to submit semi- annual report on savings or loss to United States, was repealed and restated in section 2463 of this title by Pub. L. 100-370, Sec. 2(a)(1), (c)(3), July 19, 1988, 102 Stat. 853, 854. LIMITATIONS ON CONTRACTING PERFORMED BY COAST GUARD Pub. L. 101-225, title II, Sec. 205, Dec. 12, 1989, 103 Stat. 1912, provided that: "Notwithstanding any other provision of law, an officer or employee of the United States may not enter into a contract for procurement of performance of any function being performed by Coast Guard personnel as of January 1, 1989, before - "(1) a study has been performed by the Secretary of Transportation under the Office of Management and Budget Circular A-76 with respect to that procurement; "(2) the Secretary of Transportation has performed a study, in addition to the study required by paragraph (1) of this subsection, to determine the impact of that procurement on the multimission capabilities of the Coast Guard; and "(3) copies of the studies required by paragraphs (1) and (2) of this subsection are submitted to the Committee on Merchant Marine and Fisheries [now Committee on Transportation and Infrastructure] of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate." Pub. L. 100-448, Sec. 5, Sept. 28, 1988, 102 Stat. 1837, as amended by Pub. L. 104-66, title I, Sec. 1121(b), Dec. 21, 1995, 109 Stat. 724, provided that: "(a) Maintenance of Logistics Capability. - "(1) Statement of national interest. - It is in the national interest for the Coast Guard to maintain a logistics capability (including personnel, equipment, and facilities) to provide a ready and controlled source of technical competence and resources necessary to ensure the effective and timely performance of Coast Guard missions in behalf of the security, safety, and economic and environmental well-being of the United States. "[(2) Repealed. Pub. L. 104-66, title I, Sec. 1121(b), Dec. 21, 1995, 109 Stat. 724.] "[(b) Repealed. Pub. L. 104-66, title I, Sec. 1121(b), Dec. 21, 1995, 109 Stat. 724.] "(c) Submisison [sic] of List of Activities Contracted for Performance. - At least 30 days before the beginning of each fiscal year, the Secretary shall submit to the Committee on Commerce, Science, and Transportation of the Senate and the Committee on Merchant Marine and Fisheries [now Committee on Transportation and Infrastructure] of the House of Representatives a list of activities that will be contracted for performance by non- Government personnel under the procedures of Office of Management and Budget Circular A-76 during that fiscal year. "(d) Employment of Local Residents To Perform Contracts. - "(1) In general. - Notwithstanding any other provision of law, each contract awarded by the Coast Guard in fiscal years 1988 and 1989 for construction or services to be performed in whole or in part in a State which has an unemployment rate in excess of the national average rate of unemployment (as determined by the Secretary of Labor) shall include a provision requiring the contractor to employ, for the purpose of performing that portion of the contract in that State, individuals who are local residents and who, in the case of any craft or trade, possess or would be able to acquire promptly the necessary skills. The Secretary of the department in which the Coast Guard is operating may waive this subsection in the interest of national security or economic efficiency. "(2) Local resident defined. - As used in this subsection, the term 'local resident' means a resident of a State described in paragraph (1), and any individual who commutes daily to a State described in paragraph (1)." [For transfer of authorities, functions, personnel, and assets of the Coast Guard, including the authorities and functions of the Secretary of Transportation relating thereto, to the Department of Homeland Security, and for treatment of related references, see sections 468(b), 551(d), 552(d), and 557 of Title 6, Domestic Security, and the Department of Homeland Security Reorganization Plan of November 25, 2002, as modified, set out as a note under section 542 of Title 6.] Similar provisions were contained in the following prior authorization act: Pub. L. 99-640, Sec. 5, Nov. 10, 1986, 100 Stat. 3546. CONTRACTED ADVISORY AND ASSISTANCE SERVICES Section 918 of Pub. L. 99-145, which provided that Secretary of Defense require each military department to establish accounting procedure to aid in control of expenditures for contracted advisory and assistance services, prescribe regulations to identify such services and which services are in direct support of a weapons system, consider specific list of factors in prescribing regulations, and identify total amount requested and separate category amount requested in budget documents for Department of Defense presented to Congress, was repealed and restated in section 2212 of this title by Pub. L. 100-370, Sec. 1(d)(2), July 19, 1988, 102 Stat. 842. ASSIGNMENT OF PRINCIPAL CONTRACTING OFFICERS Section 925 of Pub. L. 99-145 required Secretary of Defense to develop a policy regarding mobility and regular rotation of principal administrative and corporate administrative contracting officers in Department of Defense and to report to Committees on Armed Services of Senate and House of Representatives not later than January 1, 1986, on such policy, prior to repeal by Pub. L. 101-510, div. A, title XII, Sec. 1207(a), Nov. 5, 1990, 104 Stat. 1665. PROHIBITION ON FELONS CONVICTED OF DEFENSE-CONTRACT-RELATED FELONIES AND PENALTY ON EMPLOYMENT OF SUCH PERSONS BY DEFENSE CONTRACTORS Pub. L. 99-145, title IX, Sec. 932, Nov. 8, 1985, 99 Stat. 699, prohibited certain felons from working on defense contracts and penalized employment of such persons by defense contractors, prior to repeal by Pub. L. 99-500, Sec. 101(c) [title X, Sec. 941(b)], Oct. 18, 1986, 100 Stat. 1783-82, 1783-162, and Pub. L. 99-591, Sec. 101(c) [title X, Sec. 941(b)], Oct. 30, 1986, 100 Stat. 3341- 82, 3341-162; Pub. L. 99-661, div. A, title IX, formerly title IV, Sec. 941(b), Nov. 14, 1986, 100 Stat. 3942, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273. REIMBURSEMENT, INTEREST CHARGES, AND PENALTIES FOR OVERPAYMENTS DUE TO COST AND PRICING DATA Pub. L. 99-145, title IX, Sec. 934(a), Nov. 8, 1985, 99 Stat. 700, which provided for interest payments and penalties for overpayments due to faulty cost and pricing data, was repealed by Pub. L. 99-500, Sec. 101(c) [title X, Sec. 952(b)(2), (d)], Oct. 18, 1986, 100 Stat. 1783-82, 1783-169, and Pub. L. 99-591, Sec. 101(c) [title X, Sec. 952(b)(2), (d)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-169; Pub. L. 99-661, div. A, title IX, formerly title IV, Sec. 952(b)(2), (d), Nov. 14, 1986, 100 Stat. 3949, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, effective with respect to contracts or modifications on contracts entered into after the end of the 120-day period beginning on Oct. 18, 1986. PERSONNEL FOR PERFORMANCE OF SERVICES AND ACTIVITIES Pub. L. 99-145, title XII, Sec. 1233, Nov. 8, 1985, 99 Stat. 734, related to services and activities to be performed by non- Government personnel, prior to repeal by Pub. L. 99-661, div. A, title XII, Sec. 1222(c), Nov. 14, 1986, 100 Stat. 3977. LIMITATION ON CONTRACTING-OUT CORE LOGISTICS FUNCTIONS Section 1231(a)-(e) of Pub. L. 99-145 declared that certain specifically described functions of the Department of Defense shall be deemed logistics activities necessary to maintain the logistics capability described in section 307(a)(1) of Pub. L. 98-525, formerly set out below; contained a description of the functions, i.e., depot-level maintenance of mission-essential materiel at specifically located activities of the Army, the Navy, the Marine Corps, the Air Force, the Defense Logistics Agency, and the Defense Mapping Agency; included certain matters within the specified functions and excluded certain functions; and defined "mission- essential materiel" as related to such functions. Section 307 of Pub. L. 98-525, as amended by Pub. L. 99-145, title XII, Sec. 1231(f), Nov. 8, 1985, 99 Stat. 733, which prohibited contracting to non-Government personnel of logistics activities necessary for effective response to national emergencies unless Secretary waives such prohibition after a determination that Government performance of such activity is no longer required for national defense reasons, and reports to Congress on waiver, was repealed and restated in section 2464 of this title by Pub. L. 100- 370, Sec. 2(a)(1), (c)(2), July 19, 1988, 102 Stat. 853, 854. SHIPBUILDING CLAIMS FOR CONTRACT PRICE ADJUSTMENTS Pub. L. 98-473, title I, Sec. 101(h) [title VIII, Sec. 8078], Oct. 12, 1984, 98 Stat. 1904, 1938, prohibited expenditure of funds to adjust any contract price in any shipbuilding claim, request for equitable adjustment, or demand for payment incurred due to the preparation, submission, or adjudication of any such shipbuilding claim, request, or demand under a contract entered into after Oct. 12, 1984, arising out of events occurring more than eighteen months prior to the submission of such shipbuilding claim, request, or demand, prior to repeal by Pub. L. 100-370, Sec. 1(p)(2), July 19, 1988, 102 Stat. 851. Pub. L. 98-212, title VII, Sec. 787, Dec. 8, 1983, 97 Stat. 1453, which contained similar provisions relating to shipbuilding claims for contract price adjustments, was repealed and restated in section 2405 of this title by Pub. L. 98-525, title XII, Sec. 1234(a), (b)(2), Oct. 19, 1984, 98 Stat. 2604, effective Oct. 19, 1984. WEAPON SYSTEM GUARANTEES; GOVERNMENT-AS-SOURCE EXCEPTION; WAIVER Pub. L. 98-212, title VII, Sec. 794, Dec. 8, 1983, 97 Stat. 1454, provided for weapon system guarantees, Government-as-Source exception, and waiver, prior to repeal by Pub. L. 98-525, title XII, Sec. 1234(b)(1), Oct. 19, 1984, 98 Stat. 2604, effective Jan. 1, 1985. FIGHTER AIRCRAFT ENGINE WARRANTY Pub. L. 97-377, title I, Sec. 101(c) [title VII, Sec. 797], Dec. 21, 1982, 96 Stat. 1865, provided that: "None of the funds made available in the Act or any subsequent Act shall be available for the purchase of the alternate or new model fighter aircraft engine that does not have a written warranty or guarantee attesting that it will perform not less than 3,000 tactical cycles. The warranty will provide that the manufacturer must perform the necessary improvements or replace any parts to achieve the required performance at no cost to the Government." INSURANCE TO PROTECT GOVERNMENT CONTRACTORS AGAINST COST OF CORRECTING CONTRACTOR'S OWN DEFECTS; REIMBURSEMENT PROHIBITED Pub. L. 97-12, title I, Sec. 100, June 5, 1981, 95 Stat. 29, and Pub. L. 97-114, title VII, Sec. 770, Dec. 29, 1981, 95 Stat. 1590, which provided that no funds authorized for the Department of Defense in fiscal year 1981 and thereafter would be available to reimburse a contractor for the cost of commercial insurance, except for that normally maintained in the conduct of his business, that would protect against the cost for correction for the contractor's own defects in materials or workmanship such as were not a fortuitous casualty or loss, were repealed and restated in section 2399 of this title by Pub. L. 97-295, Secs. 1(29)(A), 6(b), Oct. 12, 1982, 96 Stat. 1293, 1315. RESTRICTIONS ON CONVERSION OF PERFORMANCE OF COMMERCIAL AND INDUSTRIAL TYPE FUNCTIONS FROM DEPARTMENT OF DEFENSE PERSONNEL TO PRIVATE CONTRACTORS; ANNUAL REPORT TO CONGRESS Pub. L. 96-342, title V, Sec. 502, Sept. 8, 1980, 94 Stat. 1086, as amended by Pub. L. 97-252, title XI, Sec. 1112(a), Sept. 8, 1982, 96 Stat. 747; Pub. L. 99-145, title XII, Sec. 1234(a), Nov. 8, 1985, 99 Stat. 734; Pub. L. 99-661, div. A, title XII, Sec. 1221, Nov. 14, 1986, 100 Stat. 3976, which provided that no commercial or industrial type function of the Department of Defense that on October 1, 1980, was being performed by Department of Defense civilian employees could be converted to performance by a private contractor to circumvent any civilian personnel ceiling unless Secretary of Defense submitted favorable cost comparisons and certifications, and reported annually to Congress with regard to such conversions, was repealed and restated in section 2461 of this title by Pub. L. 100-370, Sec. 2(a)(1), (c)(1), July 19, 1988, 102 Stat. 851, 854. Similar provisions for fiscal year 1980 were contained in Pub. L. 96-107, title VIII, Sec. 806, Nov. 9, 1979, 93 Stat. 813. CONTRACT CLAIMS; REQUEST FOR EQUITABLE ADJUSTMENT; REQUEST FOR RELIEF; CERTIFICATION Pub. L. 95-485, title VIII, Sec. 813, Oct. 20, 1978, 92 Stat. 1624, which prohibited payment of a contract claim, request for equitable adjustment, or request for relief which exceeded $100,000 unless a senior company official certified that request was made in good faith and that supporting data was accurate and complete, was repealed and restated in section 2410 of this title by Pub. L. 100- 370, Sec. 1(h)(2), (p)(4), July 19, 1988, 102 Stat. 847, 851. REPORT TO CONGRESS BY SECRETARY OF DEFENSE; CHANGES IN POLICY OR REGULATIONS CONCERNING USE OF PRIVATE CONTRACTORS FOR COMMERCIAL OR INDUSTRIAL TYPE FUNCTION AT DEPARTMENT OF DEFENSE INSTALLATIONS; RESTRICTIONS Pub. L. 95-485, title VIII, Sec. 814, Oct. 20, 1978, 92 Stat. 1625, directed the Secretary of Defense to report to the House and Senate Committees on Armed Services any proposed change in policy or regulations from those in effect before June 30, 1976, as to whether commercial or industrial functions at Defense Department installations in the United States, Puerto Rico, and Guam should be performed by Department of Defense personnel or by private contractors during the period Oct. 1, 1978 to Sept. 30, 1979; prohibited such functions to be performed privately unless such contractor performance began before Oct. 20, 1978 or performance would have been allowed by policy and regulations in effect before June 30, 1976; and provided that such prohibition would apply until the end of the 60 day period beginning on the date the report by the Secretary of Defense is received by the House and Senate Committees. REPORTING REQUIREMENTS FOR SECRETARY OF DEFENSE AND PRIME CONTRACTORS CONCERNING PAYMENTS BY PRIME CONTRACTORS FOR WORK PERFORMED BY SUBCONTRACTORS Pub. L. 95-111, title VIII, Sec. 836, Sept. 21, 1977, 91 Stat. 906, which directed the Secretary of Defense to require all prime contractors with more than $500,000 of defense contract awards to report in dollars at the end of each year the amount of work done in that year and the State where performed, and requiring the Secretary of Defense to report annually to Congress the amount of funds spent for such work in each State, was repealed and restated in subsec. (i) of this section by Pub. L. 97-295, Secs. 1(24)(C), 6(b), Oct. 12, 1982, 96 Stat. 1291, 1315. PERFORMANCE REVIEW OF DEPARTMENT OF DEFENSE COMMERCIAL OR INDUSTRIAL FUNCTIONS Pub. L. 95-79, title VIII, Sec. 809, July 30, 1977, 91 Stat. 334, directed the Secretary of Defense and the Director of the Office of Management and Budget to review criteria used in determining whether commercial or industrial type functions at Department of Defense installations within the United States, Puerto Rico, and Guam should be performed by Department of Defense personnel or by private contractors and to report to the House and Senate Armed Services Committees before Jan. 1, 1978, the results of the review; prohibited commercial or industrial type functions being performed on July 30, 1977 by Department of Defense personnel from being converted to performance by private contractors before the earlier of Mar. 15, 1978 or the end of the 90-day period beginning on the date the report is received by the House and Senate Committees; exempted from such prohibition the conversion to performance by private contractors of industrial or commercial type functions if the conversion would have been made under policies and regulations in effect before June 30, 1976; and required the Secretary of Defense to report to the House and Senate Committees on Armed Services before Jan. 1, 1978, detailing the Department's rationale for establishing goals for the percentage of work at defense research installations to be performed by private contractors and for any direction in effect on July 30, 1977 establishing a minimum or maximum percentage for the allocation of work at any defense research installation to be performed by private contractors or directing a change in any such allocation in effect on July 30, 1977. DISCRIMINATION IN PETROLEUM SUPPLIES TO ARMED FORCES PROHIBITED; ENFORCEMENT PROCEDURE; PENALTIES; EXPIRATION Pub. L. 94-106, title VIII, Sec. 816, Oct. 7, 1975, 89 Stat. 540, as amended by Pub. L. 98-620, title IV, Sec. 402(8), Nov. 8, 1984, 98 Stat. 3357, provided a remedy for discrimination by citizens of nationals of the United States or corporations organized or operating within the United States, and by organizations controlled by them, against the Department of Defense in the supply of petroleum products for two years after Oct. 7, 1975. ANNOUNCEMENTS OF AWARD OF CONTRACTS BY DEPARTMENT OF DEFENSE; DISCLOSURE OF IDENTITY OF CONTRACTOR PRIOR TO ANNOUNCEMENT PROHIBITED Pub. L. 91-441, title V, Sec. 507, Oct. 7, 1970, 84 Stat. 913, which had provided that the identity or location of a recipient of a contract from the Department of Defense may not be revealed prior to the public announcement of such identity by the Secretary of Defense, was repealed and restated in section 2316 of this title by Pub. L. 97-295, Secs. 1(26)(A), 6(b), Oct. 12, 1982, 96 Stat. 1291, 1314. AWARD OF CONTRACTS THROUGH FORMAL ADVERTISING AND COMPETITIVE BIDDING WHERE PRACTICABLE Pub. L. 90-5, title III, Sec. 304, Mar. 16, 1967, 81 Stat. 6, which had provided that the Secretary of Defense was directed, insofar as practicable, that all contracts be formally advertised and awarded on a competitive bid basis to the lowest responsible bidder, was repealed and restated in subsec. (a) of this section by Pub. L. 97-295, Secs. 1(24)(A), 6(b), Oct. 12, 1982, 96 Stat. 1290, 1314. NON-APPLICABILITY OF NATIONAL EMERGENCIES ACT Provisions of the National Emergencies Act not applicable to the powers and authorities conferred by subsec. (a)(1) of this section and actions taken hereunder, see section 1651(a)(5) of Title 50, War and National Defense. -End- -CITE- 10 USC Sec. 2304a 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2304a. Task and delivery order contracts: general authority -STATUTE- (a) Authority To Award. - Subject to the requirements of this section, section 2304c of this title, and other applicable law, the head of an agency may enter into a task or delivery order contract (as defined in section 2304d of this title) for procurement of services or property. (b) Solicitation. - The solicitation for a task or delivery order contract shall include the following: (1) The period of the contract, including the number of options to extend the contract and the period for which the contract may be extended under each option, if any. (2) The maximum quantity or dollar value of the services or property to be procured under the contract. (3) A statement of work, specifications, or other description that reasonably describes the general scope, nature, complexity, and purposes of the services or property to be procured under the contract. (c) Applicability of Restriction on Use of Noncompetitive Procedures. - The head of an agency may use procedures other than competitive procedures to enter into a task or delivery order contract under this section only if an exception in subsection (c) of section 2304 of this title applies to the contract and the use of such procedures is approved in accordance with subsection (f) of such section. (d) Single and Multiple Contract Awards. - (1) The head of an agency may exercise the authority provided in this section - (A) to award a single task or delivery order contract; or (B) if the solicitation states that the head of the agency has the option to do so, to award separate task or delivery order contracts for the same or similar services or property to two or more sources. (2) No determination under section 2304(b) of this title is required for award of multiple task or delivery order contracts under paragraph (1)(B). (3) No task or delivery order contract in an amount estimated to exceed $100,000,000 (including all options) may be awarded to a single source unless the head of the agency determines in writing that - (A) the task or delivery orders expected under the contract are so integrally related that only a single source can reasonably perform the work; (B) the contract provides only for firm, fixed price task orders or delivery orders for - (i) products for which unit prices are established in the contract; or (ii) services for which prices are established in the contract for the specific tasks to be performed; (C) only one source is qualified and capable of performing the work at a reasonable price to the government; or (D) because of exceptional circumstances, it is necessary in the public interest to award the contract to a single source. (4) The regulations implementing this subsection shall - (A) establish a preference for awarding, to the maximum extent practicable, multiple task or delivery order contracts for the same or similar services or property under the authority of paragraph (1)(B); and (B) establish criteria for determining when award of multiple task or delivery order contracts would not be in the best interest of the Federal Government. (e) Contract Modifications. - A task or delivery order may not increase the scope, period, or maximum value of the task or delivery order contract under which the order is issued. The scope, period, or maximum value of the contract may be increased only by modification of the contract. (f) Contract Period. - The head of an agency entering into a task or delivery order contract under this section may provide for the contract to cover any period up to five years and may extend the contract period for one or more successive periods pursuant to an option provided in the contract or a modification of the contract. The total contract period as extended may not exceed 10 years unless such head of an agency determines in writing that exceptional circumstances necessitate a longer contract period. (g) Inapplicability to Contracts for Advisory and Assistance Services. - Except as otherwise specifically provided in section 2304b of this title, this section does not apply to a task or delivery order contract for the procurement of advisory and assistance services (as defined in section 1105(g) of title 31). (h) Relationship to Other Contracting Authority. - Nothing in this section may be construed to limit or expand any authority of the head of an agency or the Administrator of General Services to enter into schedule, multiple award, or task or delivery order contracts under any other provision of law. -SOURCE- (Added Pub. L. 103-355, title I, Sec. 1004(a)(1), Oct. 13, 1994, 108 Stat. 3249; amended Pub. L. 108-136, div. A, title VIII, Sec. 843(b), Nov. 24, 2003, 117 Stat. 1553; Pub. L. 108-375, div. A, title VIII, Sec. 813(a), Oct. 28, 2004, 118 Stat. 2014; Pub. L. 110- 181, div. A, title VIII, Sec. 843(a)(1), Jan. 28, 2008, 122 Stat. 236; Pub. L. 111-84, div. A, title VIII, Sec. 814(a), Oct. 28, 2009, 123 Stat. 2407; Pub. L. 112-81, div. A, title VIII, Sec. 809(b), Dec. 31, 2011, 125 Stat. 1490.) -COD- CODIFICATION Another section 2304a was renumbered section 2304e of this title. -MISC1- AMENDMENTS 2011 - Subsec. (d)(3). Pub. L. 112-81 struck out subpar. (A) designation before "No task", redesignated cls. (i) to (iv) of former subpar. (A) as subpars. (A) to (D), respectively, of par. (3), redesignated subcls. (I) and (II) of former cl. (ii) as cls. (i) and (ii), respectively, of subpar. (B), and struck out former subpar. (B) which read as follows: "The head of the agency shall notify the congressional defense committees within 30 days after any determination under clause (i), (ii), (iii), or (iv) of subparagraph (A)." 2009 - Subsec. (d)(3)(B). Pub. L. 111-84 amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: "The head of the agency shall notify Congress within 30 days after any determination under subparagraph (A)(iv)." 2008 - Subsec. (d)(3), (4). Pub. L. 110-181 added par. (3) and redesignated former par. (3) as (4). 2004 - Subsec. (f). Pub. L. 108-375 substituted "any period up to five years and may extend the contract period for one or more successive periods pursuant to an option provided in the contract or a modification of the contract. The total contract period as extended may not exceed 10 years unless such head of an agency determines in writing that exceptional circumstances necessitate a longer contract period" for "a total period of not more than five years". 2003 - Subsecs. (f) to (h). Pub. L. 108-136 added subsec. (f) and redesignated former subsecs. (f) and (g) as (g) and (h), respectively. EFFECTIVE DATE OF 2008 AMENDMENT Pub. L. 110-181, div. A, title VIII, Sec. 843(a)(3)(A), Jan. 28, 2008, 122 Stat. 237, provided that: "The amendments made by paragraph (1) [amending this section] shall take effect on the date that is 120 days after the date of the enactment of this Act [Jan. 28, 2008], and shall apply with respect to any contract awarded on or after such date." EFFECTIVE DATE For effective date and applicability of section, see section 10001 of Pub. L. 103-355, set out as an Effective Date of 1994 Amendment note under section 2302 of this title. CONGRESSIONAL INTELLIGENCE COMMITTEES Pub. L. 111-84, div. A, title VIII, Sec. 814(b), Oct. 28, 2009, 123 Stat. 2407, provided that: "In the case of a task or delivery order contract awarded with respect to intelligence activities of the Department of Defense, any notification provided under [former] subparagraph (B) of section 2304a(d)(3) of title 10, United States Code, as amended by subsection (a), shall also be provided at the same time as notification is provided to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] under that subparagraph - "(1) to the Permanent Select Committee on Intelligence of the House of Representatives insofar as such task or delivery order contract relates to tactical intelligence and intelligence- related activities of the Department; and "(2) to the Select Committee on Intelligence of the Senate and the Permanent Select Committee on Intelligence of the House of Representatives insofar as such task or delivery order contract relates to intelligence and intelligence-related activities of the Department other than those specified in paragraph (1)." PROVISIONS NOT AFFECTED BY PUB. L. 103-355 Section 1004(d) of Pub. L. 103-355, as amended by Pub. L. 108- 136, div. A, title X, Sec. 1045(f), Nov. 24, 2003, 117 Stat. 1613, provided that: "Nothing in section 2304a, 2304b, 2304c, or 2304d of title 10, United States Code, as added by subsection (a), and nothing in the amendments made by subsections (b) and (c) [amending sections 2304 and 2331 of this title], shall be construed as modifying or superseding, or as intended to impair or restrict, authorities or responsibilities under chapter 11 of title 40, United States Code." -End- -CITE- 10 USC Sec. 2304b 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2304b. Task order contracts: advisory and assistance services -STATUTE- (a) Authority To Award. - (1) Subject to the requirements of this section, section 2304c of this title, and other applicable law, the head of an agency may enter into a task order contract (as defined in section 2304d of this title) for procurement of advisory and assistance services. (2) The head of an agency may enter into a task order contract for procurement of advisory and assistance services only under the authority of this section. (b) Limitation on Contract Period. - The period of a task order contract entered into under this section, including all periods of extensions of the contract under options, modifications, or otherwise, may not exceed five years unless a longer period is specifically authorized in a law that is applicable to such contract. (c) Content of Notice. - The notice required by section 1708 of title 41 and section 8(e) of the Small Business Act (15 U.S.C. 637(e)) shall reasonably and fairly describe the general scope, magnitude, and duration of the proposed task order contract in a manner that would reasonably enable a potential offeror to decide whether to request the solicitation and consider submitting an offer. (d) Required Content of Solicitation and Contract. - (1) The solicitation for the proposed task order contract shall include the information (regarding services) described in section 2304a(b) of this title. (2) A task order contract entered into under this section shall contain the same information that is required by paragraph (1) to be included in the solicitation of offers for that contract. (e) Multiple Awards. - (1) The head of an agency may, on the basis of one solicitation, award separate task order contracts under this section for the same or similar services to two or more sources if the solicitation states that the head of the agency has the option to do so. (2) If, in the case of a task order contract for advisory and assistance services to be entered into under this section, the contract period is to exceed three years and the contract amount is estimated to exceed $10,000,000 (including all options), the solicitation shall - (A) provide for a multiple award authorized under paragraph (1); and (B) include a statement that the head of the agency may also elect to award only one task order contract if the head of the agency determines in writing that only one of the offerers is capable of providing the services required at the level of quality required. (3) Paragraph (2) does not apply in the case of a solicitation for which the head of the agency concerned determines in writing that, because the services required under the task order contract are unique or highly specialized, it is not practicable to award more than one contract. (f) Contract Modifications. - (1) A task order may not increase the scope, period, or maximum value of the task order contract under which the order is issued. The scope, period, or maximum value of the contract may be increased only by modification of the contract. (2) Unless use of procedures other than competitive procedures is authorized by an exception in subsection (c) of section 2304 of this title and approved in accordance with subsection (f) of such section, competitive procedures shall be used for making such a modification. (3) Notice regarding the modification shall be provided in accordance with section 1708 of title 41 and section 8(e) of the Small Business Act (15 U.S.C. 637(e)). (g) Contract Extensions. - (1) Notwithstanding the limitation on the contract period set forth in subsection (b) or in a solicitation or contract pursuant to subsection (e), a task order contract entered into by the head of an agency under this section may be extended on a sole-source basis for a period not exceeding six months if the head of such agency determines that - (A) the award of a follow-on contract has been delayed by circumstances that were not reasonably foreseeable at the time the initial contract was entered into; and (B) the extension is necessary in order to ensure continuity of the receipt of services pending the award of, and commencement of performance under, the follow-on contract. (2) A task order contract may be extended under the authority of paragraph (1) only once and only in accordance with the limitations and requirements of this subsection. (h) Inapplicability to Certain Contracts. - This section does not apply to a contract for the acquisition of property or services that includes acquisition of advisory and assistance services if the head of an agency entering into such contract determines that, under the contract, advisory and assistance services are necessarily incident to, and not a significant component of, the contract. (i) Advisory and Assistance Services Defined. - In this section, the term "advisory and assistance services" has the meaning given such term in section 1105(g) of title 31. -SOURCE- (Added Pub. L. 103-355, title I, Sec. 1004(a)(1), Oct. 13, 1994, 108 Stat. 3251; amended Pub. L. 111-350, Sec. 5(b)(13), Jan. 4, 2011, 124 Stat. 3843.) -MISC1- AMENDMENTS 2011 - Subsecs. (c), (f)(3). Pub. L. 111-350 substituted "section 1708 of title 41" for "section 18 of the Office of Federal Procurement Policy Act (41 U.S.C. 416)". EFFECTIVE DATE For effective date and applicability of section, see section 10001 of Pub. L. 103-355, set out as an Effective Date of 1994 Amendment note under section 2302 of this title. PROVISIONS NOT AFFECTED BY PUB. L. 103-355 This section not to be construed as modifying or superseding, or as intended to impair or restrict, authorities or responsibilities under former 40 U.S.C. 759 or chapter 11 of Title 40, Public Buildings, Property, and Works, see section 1004(d) of Pub. L. 103- 355, set out as a note under section 2304a of this title. WAIVERS TO EXTEND TASK ORDER CONTRACTS FOR ADVISORY AND ASSISTANCE SERVICES Pub. L. 109-364, div. A, title VIII, Sec. 834, Oct. 17, 2006, 120 Stat. 2332, provided that: "(a) Defense Contracts. - "(1) Waiver authority. - The head of an agency may issue a waiver to extend a task order contract entered into under section 2304b of title 10, United States Code, for a period not exceeding 10 years, through five one-year options, if the head of the agency determines in writing - "(A) that the contract provides engineering or technical services of such a unique and substantial technical nature that award of a new contract would be harmful to the continuity of the program for which the services are performed; "(B) that award of a new contract would create a large disruption in services provided to the Department of Defense; and "(C) that the Department of Defense would, through award of a new contract, endure program risk during critical program stages due to loss of program corporate knowledge of ongoing program activities. "(2) Delegation. - The authority of the head of an agency under paragraph (1) may be delegated only to the senior procurement executive of the agency. "(3) Report. - Not later than April 1, 2007, the Secretary of Defense shall submit to the Committees on Armed Services of the Senate and the House of Representatives a report on advisory and assistance services. The report shall include the following information: "(A) The methods used by the Department of Defense to identify a contract as an advisory and assistance services contract, as defined in section 2304b of title 10, United States Code. "(B) The number of such contracts awarded by the Department during the five-year period preceding the date of the enactment of this Act [Oct. 17, 2006]. "(C) The average annual expenditures by the Department for such contracts. "(D) The average length of such contracts. "(E) The number of such contracts recompeted and awarded to the previous award winner. "(4) Prohibition on use of authority by department of defense if report not submitted. - The head of an agency may not issue a waiver under paragraph (1) if the report required by paragraph (3) is not submitted by the date set forth in that paragraph. "(b) Civilian Agency Contracts. - "(1) Waiver authority. - The head of an executive agency may issue a waiver to extend a task order contract entered into under section 303I of the Federal Property and Administrative Services Act of 1949 ([former] 41 U.S.C. 253i) [see 41 U.S.C. 4105] for a period not exceeding 10 years, through five one-year options, if the head of the agency determines in writing - "(A) that the contract provides engineering or technical services of such a unique and substantial technical nature that award of a new contract would be harmful to the continuity of the program for which the services are performed; "(B) that award of a new contract would create a large disruption in services provided to the executive agency; and "(C) that the executive agency would, through award of a new contract, endure program risk during critical program stages due to loss of program corporate knowledge of ongoing program activities. "(2) Delegation. - The authority of the head of an executive agency under paragraph (1) may be delegated only to the Chief Acquisition Officer of the agency (or the senior procurement executive in the case of an agency for which a Chief Acquisition Officer has not been appointed or designated under section 16(a) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 414(a)) [now 41 U.S.C. 1702(a), (b)(1), (2)]). "(3) Report. - Not later than April 1, 2007, the Administrator for Federal Procurement Policy shall submit to the Committee on Homeland Security and Governmental Affairs of the Senate and the Committee on Government Reform of the House of Representatives a report on advisory and assistance services. The report shall include the following information: "(A) The methods used by executive agencies to identify a contract as an advisory and assistance services contract, as defined in section 303I(i) of the Federal Property and Administrative Services Act of 1949 ([former] 41 U.S.C. 253i(i)) [now 41 U.S.C. 4105(a)]. "(B) The number of such contracts awarded by each executive agency during the five-year period preceding the date of the enactment of this Act [Oct. 17, 2006]. "(C) The average annual expenditures by each executive agency for such contracts. "(D) The average length of such contracts. "(E) The number of such contracts recompeted and awarded to the previous award winner. "(4) Prohibition on use of authority by executive agencies if report not submitted. - The head of an executive agency may not issue a waiver under paragraph (1) if the report required by paragraph (3) is not submitted by the date set forth in that paragraph. "(c) Termination of Authority. - A waiver may not be issued under this section after December 31, 2011. "(d) Comptroller General Review. - "(1) Report requirement. - Not later than one year after the date of the enactment of this Act [Oct. 17, 2006], the Comptroller General shall submit to the committees described in paragraph (3) a report on the use of advisory and assistance services contracts by the Federal Government. "(2) Defense and civilian agency contracts covered. - The report shall cover both of the following: "(A) Advisory and assistance services contracts as defined in section 2304b of title 10, United States Code. "(B) Advisory and assistance services contracts as defined in section 303I(i) of the Federal Property and Administrative Services Act of 1949 ([former] 41 U.S.C. 253i(i)) [now 41 U.S.C. 4105(a)]. "(3) Matters covered. - The report shall address the following issues: "(A) The extent to which executive agencies and elements of the Department of Defense require advisory and assistance services for periods of greater than five years. "(B) The extent to which such advisory and assistance services are provided by the same contractors under recurring contracts. "(C) The rationale for contracting for advisory and assistance services that will be needed on a continuing basis, rather than performing the services inside the Federal Government. "(D) The contract types and oversight mechanisms used by the Federal Government in contracts for advisory and assistance services and the extent to which such contract types and oversight mechanisms are adequate to protect the interests of the Government and taxpayers. "(E) The actions taken by the Federal Government to prevent organizational conflicts of interest and improper personal services contracts in its contracts for advisory and assistance services. "(4) Committees. - The committees described in this paragraph are the following: "(A) The Committees on Armed Services and on Homeland Security and Governmental Affairs of the Senate. "(B) The Committees on Armed Services and on Government Reform [now Oversight and Government Reform] of the House of Representatives." -End- -CITE- 10 USC Sec. 2304c 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2304c. Task and delivery order contracts: orders -STATUTE- (a) Issuance of Orders. - The following actions are not required for issuance of a task or delivery order under a task or delivery order contract: (1) A separate notice for such order under section 1708 of title 41 or section 8(e) of the Small Business Act (15 U.S.C. 637(e)). (2) Except as provided in subsection (b), a competition (or a waiver of competition approved in accordance with section 2304(f) of this title) that is separate from that used for entering into the contract. (b) Multiple Award Contracts. - When multiple task or delivery order contracts are awarded under section 2304a(d)(1)(B) or 2304b(e) of this title, all contractors awarded such contracts shall be provided a fair opportunity to be considered, pursuant to procedures set forth in the contracts, for each task or delivery order in excess of $2,500 that is to be issued under any of the contracts unless - (1) the agency's need for the services or property ordered is of such unusual urgency that providing such opportunity to all such contractors would result in unacceptable delays in fulfilling that need; (2) only one such contractor is capable of providing the services or property required at the level of quality required because the services or property ordered are unique or highly specialized; (3) the task or delivery order should be issued on a sole- source basis in the interest of economy and efficiency because it is a logical follow-on to a task or delivery order already issued on a competitive basis; or (4) it is necessary to place the order with a particular contractor in order to satisfy a minimum guarantee. (c) Statement of Work. - A task or delivery order shall include a statement of work that clearly specifies all tasks to be performed or property to be delivered under the order. (d) Enhanced Competition for Orders in Excess of $5,000,000. - In the case of a task or delivery order in excess of $5,000,000, the requirement to provide all contractors a fair opportunity to be considered under subsection (b) is not met unless all such contractors are provided, at a minimum - (1) a notice of the task or delivery order that includes a clear statement of the agency's requirements; (2) a reasonable period of time to provide a proposal in response to the notice; (3) disclosure of the significant factors and subfactors, including cost or price, that the agency expects to consider in evaluating such proposals, and their relative importance; (4) in the case of an award that is to be made on a best value basis, a written statement documenting the basis for the award and the relative importance of quality and price or cost factors; and (5) an opportunity for a post-award debriefing consistent with the requirements of section 2305(b)(5) of this title. (e) Protests. - (1) A protest is not authorized in connection with the issuance or proposed issuance of a task or delivery order except for - (A) a protest on the ground that the order increases the scope, period, or maximum value of the contract under which the order is issued; or (B) a protest of an order valued in excess of $10,000,000. (2) Notwithstanding section 3556 of title 31, the Comptroller General of the United States shall have exclusive jurisdiction of a protest authorized under paragraph (1)(B). (3) Paragraph (1)(B) and paragraph (2) of this subsection shall not be in effect after September 30, 2016. (f) Task and Delivery Order Ombudsman. - Each head of an agency who awards multiple task or delivery order contracts pursuant to section 2304a(d)(1)(B) or 2304b(e) of this title shall appoint or designate a task and delivery order ombudsman who shall be responsible for reviewing complaints from the contractors on such contracts and ensuring that all of the contractors are afforded a fair opportunity to be considered for task or delivery orders when required under subsection (b). The task and delivery order ombudsman shall be a senior agency official who is independent of the contracting officer for the contracts and may be the agency's competition advocate. (g) Applicability. - This section applies to task and delivery order contracts entered into under sections 2304a and 2304b of this title. -SOURCE- (Added Pub. L. 103-355, title I, Sec. 1004(a)(1), Oct. 13, 1994, 108 Stat. 3252; amended Pub. L. 110-181, div. A, title VIII, Sec. 843(a)(2), Jan. 28, 2008, 122 Stat. 237; Pub. L. 111-350, Sec. 5(b)(14), Jan. 4, 2011, 124 Stat. 3843; Pub. L. 111-383, div. A, title VIII, Sec. 825, title X, Sec. 1075(f)(5)(A), Jan. 7, 2011, 124 Stat. 4270, 4376.) -MISC1- AMENDMENTS 2011 - Subsec. (a)(1). Pub. L. 111-350 substituted "section 1708 of title 41" for "section 18 of the Office of Federal Procurement Policy Act (41 U.S.C. 416)". Subsec. (e). Pub. L. 111-383, Sec. 1075(f)(5)(A), made technical correction to directory language of Pub. L. 110-181, Sec. 843(a)(2)(C). See 2008 Amendment note below. Subsec. (e)(3). Pub. L. 111-383, Sec. 825, amended par. (3) generally. Prior to amendment, par. (3) read as follows: "This subsection shall be in effect for three years, beginning on the date that is 120 days after the date of the enactment of the National Defense Authorization Act for Fiscal Year 2008." 2008 - Subsec. (d). Pub. L. 110-181, Sec. 843(a)(2), added subsec. (d). Former subsec. (d) redesignated (e). Subsec. (e). Pub. L. 110-181, Sec. 843(a)(2)(C), as amended by Pub. L. 111-383, Sec. 1075(f)(5)(A), added subsec. (e) and struck out former subsec. (e). Former text read as follows: "A protest is not authorized in connection with the issuance or proposed issuance of a task or delivery order except for a protest on the ground that the order increases the scope, period, or maximum value of the contract under which the order is issued." Pub. L. 110-181, Sec. 843(a)(2)(A), redesignated subsec. (d) as (e). Former subsec. (e) redesignated (f). Subsecs. (f), (g). Pub. L. 110-181, Sec. 843(a)(2)(A), redesignated subsecs. (e) and (f) as (f) and (g), respectively. EFFECTIVE DATE OF 2008 AMENDMENT Pub. L. 110-181, div. A, title VIII, Sec. 843(a)(3)(B), Jan. 28, 2008, 122 Stat. 238, provided that: "The amendments made by paragraph (2) [amending this section] shall take effect on the date that is 120 days after the date of the enactment of this Act [Jan. 28, 2008], and shall apply with respect to any task or delivery order awarded on or after such date." EFFECTIVE DATE For effective date and applicability of section, see section 10001 of Pub. L. 103-355, set out as an Effective Date of 1994 Amendment note under section 2302 of this title. PROVISIONS NOT AFFECTED BY PUB. L. 103-355 This section not to be construed as modifying or superseding, or as intended to impair or restrict, authorities or responsibilities under former 40 U.S.C. 759 or chapter 11 of Title 40, Public Buildings, Property, and Works, see section 1004(d) of Pub. L. 103- 355, set out as a note under section 2304a of this title. -End- -CITE- 10 USC Sec. 2304d 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2304d. Task and delivery order contracts: definitions -STATUTE- In sections 2304a, 2304b, and 2304c of this title: (1) The term "task order contract" means a contract for services that does not procure or specify a firm quantity of services (other than a minimum or maximum quantity) and that provides for the issuance of orders for the performance of tasks during the period of the contract. (2) The term "delivery order contract" means a contract for property that does not procure or specify a firm quantity of property (other than a minimum or maximum quantity) and that provides for the issuance of orders for the delivery of property during the period of the contract. -SOURCE- (Added Pub. L. 103-355, title I, Sec. 1004(a)(1), Oct. 13, 1994, 108 Stat. 3253.) -MISC1- EFFECTIVE DATE For effective date and applicability of section, see section 10001 of Pub. L. 103-355, set out as an Effective Date of 1994 Amendment note under section 2302 of this title. PROVISIONS NOT AFFECTED BY PUB. L. 103-355 This section not to be construed as modifying or superseding, or as intended to impair or restrict, authorities or responsibilities under former 40 U.S.C. 759 or chapter 11 of Title 40, Public Buildings, Property, and Works, see section 1004(d) of Pub. L. 103- 355, set out as a note under section 2304a of this title. -End- -CITE- 10 USC Sec. 2304e 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2304e. Contracts: prohibition on competition between Department of Defense and small businesses and certain other entities -STATUTE- (a) Exclusion. - In any case in which the Secretary of Defense plans to use competitive procedures for a procurement, if the procurement is to be conducted as described in subsection (b), then the Secretary shall exclude the Department of Defense from competing in the procurement. (b) Procurement Description. - The requirement to exclude the Department of Defense under subsection (a) applies in the case of a procurement to be conducted by excluding from competition entities in the private sector other than - (1) small business concerns in furtherance of section 8 or 15 of the Small Business Act (15 U.S.C. 637 or 644); or (2) entities described in subsection (a)(1) of section 2323 of this title in furtherance of the goal specified in that subsection. -SOURCE- (Added Pub. L. 103-160, div. A, title VIII, Sec. 848(a)(1), Nov. 30, 1993, 107 Stat. 1724, Sec. 2304a; renumbered Sec. 2304e, Pub. L. 104-106, div. D, title XLIII, Sec. 4321(b)(6)(A), Feb. 10, 1996, 110 Stat. 672.) -MISC1- AMENDMENTS 1996 - Pub. L. 104-106 renumbered section 2304a of this title as this section. EFFECTIVE DATE Section 848(b) of Pub. L. 103-160 provided that: "Section 2304a [now 2304e] of title 10, United States Code, as added by subsection (a), shall take effect on the date of the enactment of this Act [Nov. 30, 1993]." -End- -CITE- 10 USC Sec. 2305 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2305. Contracts: planning, solicitation, evaluation, and award procedures -STATUTE- (a)(1)(A) In preparing for the procurement of property or services, the head of an agency shall - (i) specify the agency's needs and solicit bids or proposals in a manner designed to achieve full and open competition for the procurement; (ii) use advance procurement planning and market research; and (iii) develop specifications in such manner as is necessary to obtain full and open competition with due regard to the nature of the property or services to be acquired. (B) Each solicitation under this chapter shall include specifications which - (i) consistent with the provisions of this chapter, permit full and open competition; and (ii) include restrictive provisions or conditions only to the extent necessary to satisfy the needs of the agency or as authorized by law. (C) For the purposes of subparagraphs (A) and (B), the type of specification included in a solicitation shall depend on the nature of the needs of the agency and the market available to satisfy such needs. Subject to such needs, specifications may be stated in terms of - (i) function, so that a variety of products or services may qualify; (ii) performance, including specifications of the range of acceptable characteristics or of the minimum acceptable standards; or (iii) design requirements. (2) In addition to the specifications described in paragraph (1), a solicitation for sealed bids or competitive proposals (other than for a procurement for commercial items using special simplified procedures or a purchase for an amount not greater than the simplified acquisition threshold) shall at a minimum include - (A) a statement of - (i) all significant factors and significant subfactors which the head of the agency reasonably expects to consider in evaluating sealed bids (including price) or competitive proposals (including cost or price, cost-related or price- related factors and subfactors, and noncost-related or nonprice-related factors and subfactors); and (ii) the relative importance assigned to each of those factors and subfactors; and (B)(i) in the case of sealed bids - (I) a statement that sealed bids will be evaluated without discussions with the bidders; and (II) the time and place for the opening of the sealed bids; or (ii) in the case of competitive proposals - (I) either a statement that the proposals are intended to be evaluated with, and award made after, discussions with the offerors, or a statement that the proposals are intended to be evaluated, and award made, without discussions with the offerors (other than discussions conducted for the purpose of minor clarification) unless discussions are determined to be necessary; and (II) the time and place for submission of proposals. (3)(A) In prescribing the evaluation factors to be included in each solicitation for competitive proposals, the head of an agency - (i) shall clearly establish the relative importance assigned to the evaluation factors and subfactors, including the quality of the product or services to be provided (including technical capability, management capability, prior experience, and past performance of the offeror); (ii) shall include cost or price to the Federal Government as an evaluation factor that must be considered in the evaluation of proposals; and (iii) shall disclose to offerors whether all evaluation factors other than cost or price, when combined, are - (I) significantly more important than cost or price; (II) approximately equal in importance to cost or price; or (III) significantly less important than cost or price. (B) The regulations implementing clause (iii) of subparagraph (A) may not define the terms "significantly more important" and "significantly less important" as specific numeric weights that would be applied uniformly to all solicitations or a class of solicitations. (4) Nothing in this subsection prohibits an agency from - (A) providing additional information in a solicitation, including numeric weights for all evaluation factors and subfactors on a case-by-case basis; or (B) stating in a solicitation that award will be made to the offeror that meets the solicitation's mandatory requirements at the lowest cost or price. (5) The head of an agency, in issuing a solicitation for a contract to be awarded using sealed bid procedures, may not include in such solicitation a clause providing for the evaluation of prices for options to purchase additional property or services under the contract unless the head of the agency has determined that there is a reasonable likelihood that the options will be exercised. (b)(1) The head of an agency shall evaluate sealed bids and competitive proposals and make an award based solely on the factors specified in the solicitation. (2) All sealed bids or competitive proposals received in response to a solicitation may be rejected if the head of the agency determines that such action is in the public interest. (3) Sealed bids shall be opened publicly at the time and place stated in the solicitation. The head of the agency shall evaluate the bids in accordance with paragraph (1) without discussions with the bidders and, except as provided in paragraph (2), shall award a contract with reasonable promptness to the responsible bidder whose bid conforms to the solicitation and is most advantageous to the United States, considering only price and the other price-related factors included in the solicitation. The award of a contract shall be made by transmitting, in writing or by electronic means, notice of the award to the successful bidder. Within three days after the date of contract award, the head of the agency shall notify, in writing or by electronic means, each bidder not awarded the contract that the contract has been awarded. (4)(A) The head of an agency shall evaluate competitive proposals in accordance with paragraph (1) and may award a contract - (i) after discussions with the offerors, provided that written or oral discussions have been conducted with all responsible offerors who submit proposals within the competitive range; or (ii) based on the proposals received, without discussions with the offerors (other than discussions conducted for the purpose of minor clarification) provided that the solicitation included a statement that proposals are intended to be evaluated, and award made, without discussions, unless discussions are determined to be necessary. (B) If the contracting officer determines that the number of offerors that would otherwise be included in the competitive range under subparagraph (A)(i) exceeds the number at which an efficient competition can be conducted, the contracting officer may limit the number of proposals in the competitive range, in accordance with the criteria specified in the solicitation, to the greatest number that will permit an efficient competition among the offerors rated most highly in accordance with such criteria. (C) Except as provided in paragraph (2), the head of the agency shall award a contract with reasonable promptness to the responsible source whose proposal is most advantageous to the United States, considering only cost or price and the other factors included in the solicitation. The head of the agency shall award the contract by transmitting, in writing or by electronic means, notice of the award to such source and, within three days after the date of contract award, shall notify, in writing or by electronic means, all other offerors of the rejection of their proposals. This subparagraph does not apply with respect to the award of a contract for the acquisition of perishable subsistence items. (5)(A) When a contract is awarded by the head of an agency on the basis of competitive proposals, an unsuccessful offeror, upon written request received by the agency within 3 days after the date on which the unsuccessful offeror receives the notification of the contract award, shall be debriefed and furnished the basis for the selection decision and contract award. The head of the agency shall debrief the offeror within, to the maximum extent practicable, five days after receipt of the request by the agency. (B) The debriefing shall include, at a minimum - (i) the agency's evaluation of the significant weak or deficient factors in the offeror's offer; (ii) the overall evaluated cost and technical rating of the offer of the contractor awarded the contract and the overall evaluated cost and technical rating of the offer of the debriefed offeror; (iii) the overall ranking of all offers; (iv) a summary of the rationale for the award; (v) in the case of a proposal that includes a commercial item that is an end item under the contract, the make and model of the item being provided in accordance with the offer of the contractor awarded the contract; and (vi) reasonable responses to relevant questions posed by the debriefed offeror as to whether source selection procedures set forth in the solicitation, applicable regulations, and other applicable authorities were followed by the agency. (C) The debriefing may not include point-by-point comparisons of the debriefed offeror's offer with other offers and may not disclose any information that is exempt from disclosure under section 552(b) of title 5. (D) Each solicitation for competitive proposals shall include a statement that information described in subparagraph (B) may be disclosed in post-award debriefings. (E) If, within one year after the date of the contract award and as a result of a successful procurement protest, the agency seeks to fulfill the requirement under the protested contract either on the basis of a new solicitation of offers or on the basis of new best and final offers requested for that contract, the agency shall make available to all offerors - (i) the information provided in debriefings under this paragraph regarding the offer of the contractor awarded the contract; and (ii) the same information that would have been provided to the original offerors. (6)(A) When the contracting officer excludes an offeror submitting a competitive proposal from the competitive range (or otherwise excludes such an offeror from further consideration prior to the final source selection decision), the excluded offeror may request in writing, within three days after the date on which the excluded offeror receives notice of its exclusion, a debriefing prior to award. The contracting officer shall make every effort to debrief the unsuccessful offeror as soon as practicable but may refuse the request for a debriefing if it is not in the best interests of the Government to conduct a debriefing at that time. (B) The contracting officer is required to debrief an excluded offeror in accordance with paragraph (5) only if that offeror requested and was refused a preaward debriefing under subparagraph (A). (C) The debriefing conducted under subparagraph (A) shall include - (i) the executive agency's evaluation of the significant elements in the offeror's offer; (ii) a summary of the rationale for the offeror's exclusion; and (iii) reasonable responses to relevant questions posed by the debriefed offeror as to whether source selection procedures set forth in the solicitation, applicable regulations, and other applicable authorities were followed by the executive agency. (D) The debriefing conducted under subparagraph (A) may not disclose the number or identity of other offerors and shall not disclose information about the content, ranking, or evaluation of other offerors' proposals. (7) The contracting officer shall include a summary of any debriefing conducted under paragraph (5) or (6) in the contract file. (8) The Federal Acquisition Regulation shall include a provision encouraging the use of alternative dispute resolution techniques to provide informal, expeditious, and inexpensive procedures for an offeror to consider using before filing a protest, prior to the award of a contract, of the exclusion of the offeror from the competitive range (or otherwise from further consideration) for that contract. (9) If the head of an agency considers that a bid or proposal evidences a violation of the antitrust laws, he shall refer the bid or proposal to the Attorney General for appropriate action. (c) The Secretary of Defense shall ensure that before a contract for the delivery of supplies to the Department of Defense is entered into - (1) when the appropriate officials of the Department are making an assessment of the most advantageous source for acquisition of the supplies (considering quality, price, delivery, and other factors), there is a review of the availability and cost of each item of supply - (A) through the supply system of the Department of Defense; and (B) under standard Government supply contracts, if the item is in a category of supplies defined under regulations of the Secretary of Defense as being potentially available under a standard Government supply contract; and (2) there is a review of both the procurement history of the item and a description of the item, including, when necessary for an adequate description of the item, a picture, drawing, diagram, or other graphic representation of the item. (d)(1)(A) The Secretary of Defense shall ensure that, in preparing a solicitation for the award of a development contract for a major system, the head of an agency consider requiring in the solicitation that an offeror include in its offer proposals described in subparagraph (B). In determining whether to require such proposals, the head of the agency shall give due consideration to the purposes for which the system is being procured and the technology necessary to meet the system's required capabilities. If such proposals are required, the head of the agency shall consider them in evaluating the offeror's price. (B) Proposals referred to in the first sentence of subparagraph (A) are the following: (i) Proposals to incorporate in the design of the major system items which are currently available within the supply system of the Federal agency responsible for the major system, available elsewhere in the national supply system, or commercially available from more than one source. (ii) With respect to items that are likely to be required in substantial quantities during the system's service life, proposals to incorporate in the design of the major system items which the United States will be able to acquire competitively in the future. (2)(A) The Secretary of Defense shall ensure that, in preparing a solicitation for the award of a production contract for a major system, the head of an agency consider requiring in the solicitation that an offeror include in its offer proposals described in subparagraph (B). In determining whether to require such proposals, the head of the agency shall give due consideration to the purposes for which the system is being procured and the technology necessary to meet the system's required capabilities. If such proposals are required, the head of the agency shall consider them in evaluating the offeror's price. (B) Proposals referred to in the first sentence of subparagraph (A) are proposals identifying opportunities to ensure that the United States will be able to obtain on a competitive basis items procured in connection with the system that are likely to be reprocured in substantial quantities during the service life of the system. Proposals submitted in response to such requirement may include the following: (i) Proposals to provide to the United States the right to use technical data to be provided under the contract for competitive reprocurement of the item, together with the cost to the United States, if any, of acquiring such technical data and the right to use such data. (ii) Proposals for the qualification or development of multiple sources of supply for the item. (3) If the head of an agency is making a noncompetitive award of a development contract or a production contract for a major system, the factors specified in paragraphs (1) and (2) to be considered in evaluating an offer for a contract may be considered as objectives in negotiating the contract to be awarded. Such objectives may not impair the rights of prospective contractors or subcontractors otherwise provided by law. (4)(A) Whenever the head of an agency requires that proposals described in paragraph (1)(B) or (2)(B) be submitted by an offeror in its offer, the offeror shall not be required to provide a proposal that enables the United States to acquire competitively in the future an identical item if the item was developed exclusively at private expense unless the head of the agency determines that - (i) the original supplier of such item will be unable to satisfy program schedule or delivery requirements; or (ii) proposals by the original supplier of such item to meet the mobilization requirements are insufficient to meet the agency's mobilization needs. (B) In considering offers in response to a solicitation requiring proposals described in paragraph (1)(B) or (2)(B), the head of an agency shall base any evaluation of items developed exclusively at private expense on an analysis of the total value, in terms of innovative design, life-cycle costs, and other pertinent factors, of incorporating such items in the system. (e) Protest File. - (1) If, in the case of a solicitation for a contract issued by, or an award or proposed award of a contract by, the head of an agency, a protest is filed pursuant to the procedures in subchapter V of chapter 35 of title 31 and an actual or prospective offeror so requests, a file of the protest shall be established by the procuring activity and reasonable access shall be provided to actual or prospective offerors. (2) Information exempt from disclosure under section 552 of title 5 may be redacted in a file established pursuant to paragraph (1) unless an applicable protective order provides otherwise. (f) Agency Actions on Protests. - If, in connection with a protest, the head of an agency determines that a solicitation, proposed award, or award does not comply with the requirements of law or regulation, the head of the agency - (1) may take any action set out in subparagraphs (A) through (F) of subsection (b)(1) of section 3554 of title 31; and (2) may pay costs described in paragraph (1) of section 3554(c) of title 31 within the limits referred to in paragraph (2) of such section. (g) Prohibition on Release of Contractor Proposals. - (1) Except as provided in paragraph (2), a proposal in the possession or control of an agency named in section 2303 of this title may not be made available to any person under section 552 of title 5. (2) Paragraph (1) does not apply to any proposal that is set forth or incorporated by reference in a contract entered into between the Department and the contractor that submitted the proposal. (3) In this subsection, the term "proposal" means any proposal, including a technical, management, or cost proposal, submitted by a contractor in response to the requirements of a solicitation for a competitive proposal. -SOURCE- (Aug. 10, 1956, ch. 1041, 70A Stat. 130; Pub. L. 85-861, Sec. 1(44), Sept. 2, 1958, 72 Stat. 1457; Pub. L. 90-268, Sec. 3, Mar. 16, 1968, 82 Stat. 49; Pub. L. 98-369, div. B, title VII, Sec. 2723(b), July 18, 1984, 98 Stat. 1191; Pub. L. 98-525, title XII, Sec. 1213(a), Oct. 19, 1984, 98 Stat. 2591; Pub. L. 99-145, title XIII, Sec. 1303(a)(14), Nov. 8, 1985, 99 Stat. 739; Pub. L. 99-500, Sec. 101(c) [title X, Sec. 924(a), (b)], Oct. 18, 1986, 100 Stat. 1783-82, 1783-153, and Pub. L. 99-591, Sec. 101(c) [title X, Sec. 924(a), (b)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-153; Pub. L. 99-661, div. A, title III, Sec. 313(b), title IX, formerly title IV, Sec. 924(a), (b), Nov. 14, 1986, 100 Stat. 3853, 3932, 3933, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; Pub. L. 100-456, div. A, title VIII, Sec. 806, Sept. 29, 1988, 102 Stat. 2010; Pub. L. 101-189, div. A, title VIII, Sec. 853(f), Nov. 29, 1989, 103 Stat. 1519; Pub. L. 101-510, div. A, title VIII, Sec. 802(a)-(d), Nov. 5, 1990, 104 Stat. 1588, 1589; Pub. L. 103-160, div. A, title XI, Sec. 1182(a)(5), Nov. 30, 1993, 107 Stat. 1771; Pub. L. 103-355, title I, Secs. 1011-1016, title IV, Sec. 4401(b), Oct. 13, 1994, 108 Stat. 3254-3257, 3347; Pub. L. 104-106, div. D, title XLI, Secs. 4103(a), 4104(a), title XLII, Sec. 4202(a)(2), div. E, title LVI, Sec. 5601(a), Feb. 10, 1996, 110 Stat. 643, 644, 653, 699; Pub. L. 104-201, div. A, title VIII, Sec. 821(a), title X, Sec. 1074(a)(11), (b)(4)(A), Sept. 23, 1996, 110 Stat. 2609, 2659, 2660; Pub. L. 106-65, div. A, title VIII, Sec. 821, Oct. 5, 1999, 113 Stat. 714.) -MISC1- HISTORICAL AND REVISION NOTES 1956 ACT -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2305(a) 41:152 (less clause (b)). Feb. 19, 1948, ch. 65, Secs. 2(d), 3, 62 Stat. 22. 2305(b) 41:152 (clause (b)). 2305(c) 41:151(d). -------------------------------------------------------------------- In subsection (a), the word "needed" is substituted for the words "necessary to meet the requirements". In subsection (b), the words "United States" are substituted for the word "Government". 1958 ACT -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2305 41:152(c). Aug. 9, 1955, ch. 628, Sec. 15, 69 Stat. 551. -------------------------------------------------------------------- Reference to bids is omitted as surplusage (see opinion of the Judge Advocate General of the Army (JAGT 1956/9122, 21 Dec. 1956)). The word "attachments" is substituted for the words "material required". The words "the specifications in" are inserted in the second sentence for clarity. The word "available" is omitted as covered by the word "accessible." The words "no award may be made" are substituted for the words "and any award or awards made to any bidder in such case shall be invalidated and rejected". -COD- CODIFICATION Pub. L. 99-591 is a corrected version of Pub. L. 99-500. -MISC2- AMENDMENTS 1999 - Subsec. (g)(1). Pub. L. 106-65 substituted "an agency named in section 2303 of this title" for "the Department of Defense". 1996 - Subsec. (a)(2). Pub. L. 104-106, Sec. 4202(a)(2), inserted "a procurement for commercial items using special simplified procedures or" after "(other than for". Subsec. (b)(4)(B). Pub. L. 104-106, Sec. 4103(a)(3), added subpar. (B). Former subpar. (B) redesignated (C). Pub. L. 104-106, Sec. 4103(a)(1), transferred text of subpar. (C) to end of subpar. (B) and substituted "This subparagraph" for "Subparagraph (B)" at beginning of that text. Subsec. (b)(4)(C). Pub. L. 104-106, Sec. 4103(a)(2), redesignated subpar. (B) as (C). Pub. L. 104-106, Sec. 4103(a)(1), struck out "(C)" before "Subparagraph (B)" and transferred text of subpar. (C) to end of subpar. (B). Subsec. (b)(5)(F). Pub. L. 104-106, Sec. 4104(a)(1), struck out subpar. (F) which read as follows: "The contracting officer shall include a summary of the debriefing in the contract file." Subsec. (b)(6). Pub. L. 104-106, Sec. 4104(a)(3), added par. (6). Former par. (6) redesignated (9). Subsec. (b)(6)(B). Pub. L. 104-201, Sec. 1074(a)(11)(A), struck out "of this section" after "paragraph (5)" and "of this paragraph" after "subparagraph (A)". Subsec. (b)(6)(C). Pub. L. 104-201, Sec. 1074(a)(11)(B), substituted "subparagraph (A)" for "this subsection" in introductory provisions. Subsec. (b)(6)(D). Pub. L. 104-201, Sec. 1074(a)(11)(C), substituted "under subparagraph (A)" for "pursuant to this subsection". Subsec. (b)(7), (8). Pub. L. 104-106, Sec. 4104(a)(3), added pars. (7) and (8). Subsec. (b)(9). Pub. L. 104-106, Sec. 4104(a)(2), redesignated par. (6) as (9). Subsec. (e)(3). Pub. L. 104-106, Sec. 5601(a), as amended by Pub. L. 104-201, Sec. 1074(b)(4)(A), struck out par. (3) which read as follows: "Regulations implementing this subsection shall be consistent with the regulations regarding the preparation and submission of an agency's protest file (the so-called 'rule 4 file') for protests to the General Services Board of Contract Appeals under section 111 of the Federal Property and Administrative Services Act of 1949 (41 U.S.C. 759)." Subsec. (g). Pub. L. 104-201, Sec. 821(a), added subsec. (g). 1994 - Subsec. (a)(2). Pub. L. 103-355, Sec. 4401(b), substituted "a purchase for an amount not greater than the simplified acquisition threshold)" for "small purchases)" in introductory provisions. Subsec. (a)(2)(A)(i). Pub. L. 103-355, Sec. 1011(a)(1), substituted "and significant subfactors" for "(and significant subfactors)" and "cost-related or price-related factors and subfactors, and noncost-related or nonprice-related factors and subfactors" for "cost- or price-related factors, and noncost- or nonprice-related factors". Subsec. (a)(2)(A)(ii). Pub. L. 103-355, Sec. 1011(a)(2), substituted "and subfactors" for "(and subfactors)". Subsec. (a)(2)(B)(ii)(I). Pub. L. 103-355, Sec. 1011(a)(3), amended subcl. (I) generally. Prior to amendment, subcl. (I) read as follows: "a statement that the proposals are intended to be evaluated with, and award made after, discussions with the offerors, or a statement that the proposals are intended to be evaluated, and award made, without discussions with the offerors (other than discussions conducted for the purpose of minor clarification), unless discussions are determined to be necessary; and". Subsec. (a)(3). Pub. L. 103-355, Sec. 1011(b), added par. (3) and struck out former par. (3), which read as follows: "In prescribing the evaluation factors to be included in each solicitation for competitive proposals, the head of an agency shall clearly establish the relative importance assigned to the evaluation factors and subfactors, including the quality of the product or services to be provided (including technical capability, management capability, and prior experience of the offeror)." Subsec. (a)(4). Pub. L. 103-355, Sec. 1011(b), added par. (4). Subsec. (a)(5). Pub. L. 103-355, Sec. 1012, added par. (5). Subsec. (b)(3). Pub. L. 103-355, Sec. 1013(a), substituted "transmitting, in writing or by electronic means, notice" for "transmitting written notice" and inserted at end "Within three days after the date of contract award, the head of the agency shall notify, in writing or by electronic means, each bidder not awarded the contract that the contract has been awarded." Subsec. (b)(4)(B). Pub. L. 103-355, Sec. 1013(b), substituted "transmitting, in writing or by electronic means, notice" for "transmitting written notice" and ", within three days after the date of contract award, shall notify, in writing or by electronic means," for "shall promptly notify". Subsec. (b)(5), (6). Pub. L. 103-355, Sec. 1014, added par. (5) and redesignated former par. (5) as (6). Subsec. (e). Pub. L. 103-355, Sec. 1015, added subsec. (e). Subsec. (f). Pub. L. 103-355, Sec. 1016, added subsec. (f). 1993 - Subsec. (b)(4)(A). Pub. L. 103-160 realigned margins of cls. (i) and (ii). 1990 - Subsec. (a)(2)(A)(i). Pub. L. 101-510, Sec. 802(a)(1), inserted "(and significant subfactors)" after "significant factors" and substituted "(including cost or price, cost- or price-related factors, and noncost- or nonprice-related factors)" for "(including cost or price)". Subsec. (a)(2)(A)(ii). Pub. L. 101-510, Sec. 802(a)(2), inserted "(and subfactors)" after "those factors". Subsec. (a)(2(B)(ii)(I). Pub. L. 101-510, Sec. 802(b), amended subcl. (I) generally. Prior to amendment, subcl. (I) read as follows: "a statement that the proposals are intended to be evaluated with, and awards made after, discussions with the offerors, but might be evaluated and awarded without discussions with the offerors; and". Subsec. (a)(3). Pub. L. 101-510, Sec. 802(c), substituted "the evaluation factors and subfactors, including the quality of the product or services" for "the quality of the services". Subsec. (b)(1). Pub. L. 101-510, Sec. 802(d)(1), inserted "and make an award" after "competitive proposals". Subsec. (b)(3). Pub. L. 101-510, Sec. 802(d)(2), inserted "in accordance with paragraph (1)" after "shall evaluate the bids". Subsec. (b)(4)(A). Pub. L. 101-510, Sec. 802(d)(3)(A), substituted "competitive proposals in accordance with paragraph (1)" for "competitive proposals" in introductory provisions, added cls. (i) and (ii), and struck out former cls. (i) and (ii) which read as follows: "(i) after discussions conducted with the offerors at any time after receipt of the proposals and before the award of the contract; or "(ii) without discussions with the offerors (other than discussions conducted for the purpose of minor clarification) when it can be clearly demonstrated from the existence of full and open competition or accurate prior cost experience with the product or service that acceptance of an initial proposal without discussions would result in the lowest overall cost to the United States." Subsec. (b)(4)(B) to (E). Pub. L. 101-510, Sec. 802(d)(3)(B)-(D), redesignated subpars. (D) and (E) as (B) and (C), respectively, substituted "Subparagraph (B)" for "Subparagraph (D)" in subpar. (C), and struck out former subpars. (B) and (C) which read as follows: "(B) In the case of award of a contract under subparagraph (A)(i), the head of the agency shall conduct, before such award, written or oral discussions with all responsible sources who submit proposals within the competitive range, considering only cost or price and the other factors included in the solicitation. "(C) In the case of award of a contract under subparagraph (A)(ii), the head of the agency shall award the contract based on the proposals received (and as clarified, if necessary, in discussions conducted for the purpose of minor clarification)." 1989 - Subsec. (b)(4)(D). Pub. L. 101-189 inserted "cost or" after "considering only". 1988 - Subsec. (d)(1)(B). Pub. L. 100-456, Sec. 806(b), substituted "Proposals referred to in the first sentence of subparagraph (A) are" for "The proposals that the head of an agency is to consider requiring in a solicitation for the award of a development contract are". Subsec. (d)(2)(B). Pub. L. 100-456, Sec. 806(b), substituted "Proposals referred to in the first sentence of subparagraph (A) are" for "The proposals that the head of an agency is to consider requiring in a solicitation for the award of a production contract are". Subsec. (d)(3). Pub. L. 100-456, Sec. 806(a)(2), inserted provision that objectives may not impair the rights of prospective contractors or subcontractors otherwise provided by law. Subsec. (d)(4). Pub. L. 100-456, Sec. 806(a)(1), added par. (4). 1986 - Subsec. (a). Pub. L. 99-500 and Pub. L. 99-591, Sec. 101(c) [Sec. 924(a)], Pub. L. 99-661, Sec. 924(a), amended subsec. (a) identically, in par. (2)(A)(i) striking out "(including price)" after "factors" and inserting "(including price)" and "(including cost and price)" and adding par. (3). Subsec. (b)(4)(B). Pub. L. 99-500 and Pub. L. 99-591, Sec. 101(c) [Sec. 924(b)], Pub. L. 99-661, Sec. 924(b), amended subpar. (B) identically, inserting "cost or". Subsec. (b)(4)(E). Pub. L. 99-661, Sec. 313(b), added subpar. (E). 1985 - Subsec. (b)(5). Pub. L. 99-145 aligned the margin of par. (5). 1984 - Subsecs. (c), (d). Pub. L. 98-525 added subsecs. (c) and (d). Catchline, subsecs. (a) to (d). Pub. L. 98-369 substituted "Contracts: planning, solicitation, evaluation, and award procedures" for "Formal advertisements for bids; time; opening; award; rejection" and completely revised the text to substitute a program using solicitation requirements covering military procurement for former provisions which had used the approach of utilizing formal advertisements, struck out former provisions which had directed that, except in cases where the Secretary of Defense had determined that military requirements necessitated the specification of container size, no advertisement or invitation to bid for the carriage of government property in other than government-owned cargo containers could specify carriage of such property in cargo containers of any stated length, height, or width, and carried forward into new subsecs. (a)(1)(A)(iii), (B)(i), and (b)(2) and (5) the content of former section. 1968 - Subsec. (a). Pub. L. 90-268 inserted provision that, except in cases where the Secretary of Defense determines that military requirements necessitate such specification, no advertisement or invitation to bid for the carriage of Government property in other than Government-owned cargo containers shall specify carriage of such property in cargo containers of any stated length, height, or width. 1958 - Subsecs. (b) to (d). Pub. L. 85-861 added subsec. (b) and redesignated former subsecs. (b) and (c) as (c) and (d), respectively. EFFECTIVE DATE OF 1996 AMENDMENT For effective date and applicability of amendment by sections 4103(a), 4104(a), and 4202(a)(2) of Pub. L. 104-106, see section 4401 of Pub. L. 104-106, set out as a note under section 2302 of this title. Amendment by section 5601(a) of Pub. L. 104-106 effective 180 days after Feb. 10, 1996, see section 5701 of Pub. L. 104-106, Feb. 10, 1996, 110 Stat. 702. EFFECTIVE DATE OF 1994 AMENDMENT For effective date and applicability of amendment by Pub. L. 103- 355, see section 10001 of Pub. L. 103-355, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1990 AMENDMENT Section 802(e) of Pub. L. 101-510 provided that: "(1) Except as provided in paragraph (2), the amendments made by this section [amending this section] shall apply with respect to solicitations for sealed bids or competitive proposals issued after the end of the 120-day period beginning on the date of the enactment of this Act [Nov. 5, 1990]. "(2) The Secretary of Defense may require the amendments made by this section to apply with respect to solicitations issued before the end of the period referred to in paragraph (1). The Secretary of Defense shall publish in the Federal Register notice of any such earlier effective date." EFFECTIVE DATE OF 1986 AMENDMENT Section 101(c) [title X, Sec. 924(c)] of Pub. L. 99-500 and Pub. L. 99-591, and section 924(c) of title IX, formerly title IV, of Pub. L. 99-661, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, provided that: "The amendments made by this section [amending this section] shall apply with respect to solicitations for sealed bids or competitive proposals issued after the end of the 180-day period beginning on the date of the enactment of this Act [Oct. 18, 1986]." EFFECTIVE DATE OF 1984 AMENDMENTS Section 1213(b) of Pub. L. 98-525 provided that: "The amendment made by subsection (a) [amending this section] shall take effect at the end of the 180-day period beginning on the date of the enactment of this Act [Oct. 19, 1984]." Amendment by Pub. L. 98-369 applicable with respect to any solicitation for bids or proposals issued after Mar. 31, 1985, see section 2751 of Pub. L. 98-369, set out as a note under section 2302 of this title. GUIDANCE ON USE OF TIERED EVALUATIONS OF OFFERS FOR CONTRACTS AND TASK ORDERS UNDER CONTRACTS Pub. L. 109-163, div. A, title VIII, Sec. 816, Jan. 6, 2006, 119 Stat. 3382, provided that: "(a) Guidance Required. - The Secretary of Defense shall prescribe guidance for the military departments and the Defense Agencies on the use of tiered evaluations of offers for contracts and for task or delivery orders under contracts. "(b) Elements. - The guidance prescribed under subsection (a) shall include a prohibition on the initiation by a contracting officer of a tiered evaluation of an offer for a contract or for a task or delivery order under a contract unless the contracting officer - "(1) has conducted market research in accordance with part 10 of the Federal Acquisition Regulation in order to determine whether or not a sufficient number of qualified small businesses are available to justify limiting competition for the award of such contract or task or delivery order under applicable law and regulations; "(2) is unable, after conducting market research under paragraph (1), to make the determination described in that paragraph; and "(3) includes in the contract file a written explanation of why such contracting officer was unable to make such determination." AUTHORIZATION OF EVALUATION FACTOR FOR DEFENSE CONTRACTORS EMPLOYING OR SUBCONTRACTING WITH MEMBERS OF THE SELECTED RESERVE OF THE RESERVE COMPONENTS OF THE ARMED FORCES Pub. L. 109-163, div. A, title VIII, Sec. 819, Jan. 6, 2006, 119 Stat. 3385, provided that: "(a) Defense Contracts. - In awarding any contract for the procurement of goods or services to an entity, the Secretary of Defense is authorized to use as an evaluation factor whether the entity intends to carry out the contract using employees or individual subcontractors who are members of the Selected Reserve of the reserve components of the Armed Forces. "(b) Documentation of Selected Reserve-Related Evaluation Factor. - Any entity claiming intent to carry out a contract using employees or individual subcontractors who are members of the Selected Reserve of the reserve components of the Armed Forces shall submit proof of the use of such employees or subcontractors for the Department of Defense to consider in carrying out subsection (a) with respect to that contract. "(c) Regulations. - The Federal Acquisition Regulation shall be revised as necessary to implement this section." CERTIFICATE OF COMPETENCY REQUIREMENTS Pub. L. 102-484, div. A, title VIII, Sec. 804, Oct. 23, 1992, 106 Stat. 2447, provided that, in case of contract to be entered into pursuant to this chapter, other than pursuant to simplified procedures under section 2304(g) of this title, solicitation was to contain notice of right of bidding small business concern, in case of determination by contracting officer that concern was nonresponsible, to request Small Business Administration to make determination of responsibility under section 637(b)(7) of Title 15, Commerce and Trade, that if contracting officer determined that concern was nonresponsible, such officer was to notify concern in writing, of such determination, that concern had right to request Small Business Administration to make determination, and that, if concern desired to request such determination, concern was to inform officer in writing, within 14 days after receipt of notice, of such desire, and that, after being so informed, officer was to transmit request to Administration, or, if not so informed, officer was to proceed with award of contract, and contained provisions relating to effective and termination dates and report to be submitted to Congress, prior to repeal by Pub. L. 103-355, title VII, Sec. 7101(b), Oct. 13, 1994, 108 Stat. 3367. CONSTRUCTION OF 1984 AMENDMENT Amendment by Pub. L. 98-369 as not superseding or affecting the provisions of section 637(a) of Title 15, Commerce and Trade, see section 2723(c) of Pub. L. 98-369, set out as a note under section 2304 of this title. -End- -CITE- 10 USC Sec. 2305a 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2305a. Design-build selection procedures -STATUTE- (a) Authorization. - Unless the traditional acquisition approach of design-bid-build established under chapter 11 of title 40 is used or another acquisition procedure authorized by law is used, the head of an agency shall use the two-phase selection procedures authorized in this section for entering into a contract for the design and construction of a public building, facility, or work when a determination is made under subsection (b) that the procedures are appropriate for use. (b) Criteria for Use. - A contracting officer shall make a determination whether two-phase selection procedures are appropriate for use for entering into a contract for the design and construction of a public building, facility, or work when the contracting officer anticipates that three or more offers will be received for such contract, design work must be performed before an offeror can develop a price or cost proposal for such contract, the offeror will incur a substantial amount of expense in preparing the offer, and the contracting officer has considered information such as the following: (1) The extent to which the project requirements have been adequately defined. (2) The time constraints for delivery of the project. (3) The capability and experience of potential contractors. (4) The suitability of the project for use of the two-phase selection procedures. (5) The capability of the agency to manage the two-phase selection process. (6) Other criteria established by the agency. (c) Procedures Described. - Two-phase selection procedures consist of the following: (1) The agency develops, either in-house or by contract, a scope of work statement for inclusion in the solicitation that defines the project and provides prospective offerors with sufficient information regarding the Government's requirements (which may include criteria and preliminary design, budget parameters, and schedule or delivery requirements) to enable the offerors to submit proposals which meet the Government's needs. If the agency contracts for development of the scope of work statement, the agency shall contract for architectural and engineering services as defined by and in accordance with chapter 11 of title 40. (2) The contracting officer solicits phase-one proposals that - (A) include information on the offeror's - (i) technical approach; and (ii) technical qualifications; and (B) do not include - (i) detailed design information; or (ii) cost or price information. (3) The evaluation factors to be used in evaluating phase-one proposals are stated in the solicitation and include specialized experience and technical competence, capability to perform, past performance of the offeror's team (including the architect- engineer and construction members of the team) and other appropriate factors, except that cost-related or price-related evaluation factors are not permitted. Each solicitation establishes the relative importance assigned to the evaluation factors and subfactors that must be considered in the evaluation of phase-one proposals. The agency evaluates phase-one proposals on the basis of the phase-one evaluation factors set forth in the solicitation. (4) The contracting officer selects as the most highly qualified the number of offerors specified in the solicitation to provide the property or services under the contract and requests the selected offerors to submit phase-two competitive proposals that include technical proposals and cost or price information. Each solicitation establishes with respect to phase two - (A) the technical submission for the proposal, including design concepts or proposed solutions to requirements addressed within the scope of work (or both), and (B) the evaluation factors and subfactors, including cost or price, that must be considered in the evaluations of proposals in accordance with paragraphs (2), (3), and (4) of section 2305(a) of this title. The contracting officer separately evaluates the submissions described in subparagraphs (A) and (B). (5) The agency awards the contract in accordance with section 2305(b)(4) of this title. (d) Solicitation to State Number of Offerors To Be Selected for Phase Two Requests for Competitive Proposals. - A solicitation issued pursuant to the procedures described in subsection (c) shall state the maximum number of offerors that are to be selected to submit competitive proposals pursuant to subsection (c)(4). The maximum number specified in the solicitation shall not exceed 5 unless the agency determines with respect to an individual solicitation that a specified number greater than 5 is in the Government's interest and is consistent with the purposes and objectives of the two-phase selection process. (e) Requirement for Guidance and Regulations. - The Federal Acquisition Regulation shall include guidance - (1) regarding the factors that may be considered in determining whether the two-phase contracting procedures authorized by subsection (a) are appropriate for use in individual contracting situations; (2) regarding the factors that may be used in selecting contractors; and (3) providing for a uniform approach to be used Government- wide. (f) Special Authority for Military Construction Projects. - (1) The Secretary of a military department may use funds available to the Secretary under section 2807(a) or 18233(e) of this title to accelerate the design effort in connection with a military construction project for which the two-phase selection procedures described in subsection (c) are used to select the contractor for both the design and construction portion of the project before the project is specifically authorized by law and before funds are appropriated for the construction portion of the project. Notwithstanding the limitations contained in such sections, use of such funds for the design portion of a military construction project may continue despite the subsequent authorization of the project. The advance notice requirement of section 2807(b) of this title shall continue to apply whenever the estimated cost of the design portion of the project exceeds the amount specified in such section. (2) Any military construction contract that provides for an accelerated design effort, as authorized by paragraph (1), shall include as a condition of the contract that the liability of the United States in a termination for convenience before funds are first made available for construction may not exceed an amount attributable to the final design of the project. (3) For each fiscal year during which the authority provided by this subsection is in effect, the Secretary of a military department may select not more than two military construction projects to include the accelerated design effort authorized by paragraph (1) for each armed force under the jurisdiction of the Secretary. To be eligible for selection under this subsection, a request for the authorization of the project, and for the authorization of appropriations for the project, must have been included in the annual budget of the President for a fiscal year submitted to Congress under section 1105(a) of title 31. (4) Not later than March 1, 2008, the Secretary of Defense shall submit to the congressional defense committees a report evaluating the usefulness of the authority provided by this subsection in expediting the design and construction of military construction projects. The authority provided by this subsection expires September 30, 2008, except that, if the report required by this paragraph is not submitted by March 1, 2008, the authority shall expire on that date. -SOURCE- (Added Pub. L. 104-106, div. D, title XLI, Sec. 4105(a)(1), Feb. 10, 1996, 110 Stat. 645; amended Pub. L. 105-85, div. A, title X, Sec. 1073(a)(44), Nov. 18, 1997, 111 Stat. 1902; Pub. L. 107-217, Sec. 3(b)(4), Aug. 21, 2002, 116 Stat. 1295; Pub. L. 108-178, Sec. 4(b)(3), Dec. 15, 2003, 117 Stat. 2641; Pub. L. 108-375, div. B, title XXVIII, Sec. 2807, Oct. 28, 2004, 118 Stat. 2123; Pub. L. 109- 163, div. B, title XXVIII, Sec. 2807, Jan. 6, 2006, 119 Stat. 3508.) -MISC1- PRIOR PROVISIONS A prior section 2305a was renumbered section 2438 of this title. AMENDMENTS 2006 - Subsec. (f)(2). Pub. L. 109-163, Sec. 2807(a), amended par. (2) generally. Prior to amendment, par. (2) read as follows: "Any military construction contract that provides for an accelerated design effort, as authorized by paragraph (1), shall include as a condition of the contract that the liability of the United States in a termination for convenience may not exceed the actual costs incurred as of the termination date." Subsec. (f)(4). Pub. L. 109-163, Sec. 2807(b), substituted "2008" for "2007" wherever appearing. 2004 - Subsec. (f). Pub. L. 108-375 added subsec. (f). 2003 - Subsec. (c)(1). Pub. L. 108-178 substituted "chapter 11 of title 40" for "the Brooks Architect-Engineers Act (40 U.S.C. 541 et seq.)". 2002 - Subsec. (a). Pub. L. 107-217 substituted "chapter 11 of title 40" for "the Brooks Architect-Engineers Act (40 U.S.C. 541 et seq.)". 1997 - Subsec. (a). Pub. L. 105-85 substituted "(40 U.S.C." for "(41 U.S.C.". EFFECTIVE DATE OF 2003 AMENDMENT Amendment by Pub. L. 108-178 effective Aug. 21, 2002, see section 5 of Pub. L. 108-178, set out as a note under section 5334 of Title 5, Government Organization and Employees. EFFECTIVE DATE For effective date and applicability of section, see section 4401 of Pub. L. 104-106, set out as an Effective Date of 1996 Amendment note under section 2302 of this title. -End- -CITE- 10 USC Sec. 2306 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2306. Kinds of contracts -STATUTE- (a) The cost-plus-a-percentage-of-cost system of contracting may not be used. Subject to the limitation in the preceding sentence, the other provisions of this section, and other applicable provisions of law, the head of an agency, in awarding contracts under this chapter after using procedures other than sealed-bid procedures, may enter into any kind of contract that he considers will promote the best interests of the United States. (b) Each contract awarded under this chapter after using procedures other than sealed-bid procedures shall contain a warranty, determined to be suitable by the head of the agency, that the contractor has employed or retained no person or selling agency to solicit or obtain the contract under an understanding or agreement for a commission, percentage, brokerage, or contingent fee, except a bona fide employee or established commercial or selling agency maintained by him to obtain business. If a contractor breaks such a warranty the United States may annul the contract without liability or may deduct the commission, percentage, brokerage, or contingent fee from the contract price or consideration. This subsection does not apply to a contract that is for an amount not greater than the simplified acquisition threshold or to a contract for the acquisition of commercial items. (c) A contract entered into by the United States in connection with a military construction project or a military family housing project may not use any form of cost-plus contracting. This prohibition is in addition to the prohibition specified in subsection (a) on the use of the cost-plus-a-percentage-of-cost system of contracting and applies notwithstanding a declaration of war or the declaration by the President of a national emergency under section 201 of the National Emergencies Act (50 U.S.C. 1621) that includes the use of the armed forces. (d) The fee for performing a cost-plus-a-fixed-fee contract for experimental, developmental, or research work may not be more than 15 percent of the estimated cost of the contract, not including the fee. The fee for performing a cost-plus-a-fixed-fee contract for architectural or engineering services for a public work or utility plus the cost of those services to the contractor may not be more than 6 percent of the estimated cost of that work or project, not including fees. The fee for performing any other cost-plus-a-fixed- fee contract may not be more than 10 percent of the estimated cost of the contract, not including the fee. Determinations under this subsection of the estimated costs of a contract or project shall be made by the head of the agency at the time the contract is made. (e)(1) Except as provided in paragraph (2), each cost contract and each cost-plus-a-fixed-fee contract shall provide for notice to the agency by the contractor before the making, under the prime contract, of - (A) a cost-plus-a-fixed-fee subcontract; or (B) a fixed-price subcontract or purchase order involving more than the greater of (i) the simplified acquisition threshold, or (ii) 5 percent of the estimated cost of the prime contract. (2) Paragraph (1) shall not apply to a prime contract with a contractor that maintains a purchasing system approved by the contracting officer for the contract. (f) So-called "truth-in-negotiations" provisions relating to cost or pricing data to be submitted by certain contractors and subcontractors are provided in section 2306a of this title. (g) Multiyear contracting authority for the acquisition of services is provided in section 2306c of this title. (h) Multiyear contracting authority for the purchase of property is provided in section 2306b of this title. -SOURCE- (Aug. 10, 1956, ch. 1041, 70A Stat. 130; Pub. L. 87-653, Sec. 1(d), (e), Sept. 10, 1962, 76 Stat. 528; Pub. L. 90-378, Sec. 1, July 5, 1968, 82 Stat. 289; Pub. L. 90-512, Sept. 25, 1968, 82 Stat. 863; Pub. L. 96-513, title V, Sec. 511(77), Dec. 12, 1980, 94 Stat. 2926; Pub. L. 97-86, title IX, Secs. 907(b), 909(b), Dec. 1, 1981, 95 Stat. 1117, 1118; Pub. L. 98-369, div. B, title VII, Sec. 2724, July 18, 1984, 98 Stat. 1192; Pub. L. 99-145, title XIII, Sec. 1303(a)(15), Nov. 8, 1985, 99 Stat. 739; Pub. L. 99-500, Sec. 101(c) [title X, Sec. 952(b)(1), (c)(1)], Oct. 18, 1986, 100 Stat. 1783-82, 1783-169, and Pub. L. 99-591, Sec. 101(c) [title X, Sec. 952(b)(1), (c)(1)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-169; Pub. L. 99-661, div. A, title IX, formerly title IV, Sec. 952(b)(1), (c)(1), Nov. 14, 1986, 100 Stat. 3949, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; Pub. L. 101-189, div. A, title VIII, Sec. 805(a), Nov. 29, 1989, 103 Stat. 1488; Pub. L. 101-510, div. A, title VIII, Sec. 808, Nov. 5, 1990, 104 Stat. 1593; Pub. L. 102-25, title VII, Sec. 701(d)(3), Apr. 6, 1991, 105 Stat. 114; Pub. L. 103-355, title I, Secs. 1021, 1022(b), title IV, Secs. 4102(b), 4401(c), title VIII, Sec. 8105(a), Oct. 13, 1994, 108 Stat. 3257, 3260, 3340, 3348, 3392; Pub. L. 105-85, div. A, title X, Sec. 1073(a)(45), Nov. 18, 1997, 111 Stat. 1902; Pub. L. 106-398, Sec. 1 [[div. A], title VIII, Sec. 802(b)], Oct. 30, 2000, 114 Stat. 1654, 1654A-205; Pub. L. 108-136, div. A, title VIII, Sec. 842, Nov. 24, 2003, 117 Stat. 1552; Pub. L. 112-81, div. B, title XXVIII, Sec. 2801(a), Dec. 31, 2011, 125 Stat. 1684.) -MISC1- HISTORICAL AND REVISION NOTES -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2306(a) 41:153(a) (1st sentence). Feb. 19, 1948, ch. 65, Sec. 4 (less words after semicolon of last sentence of (b), and less (c)), 62 Stat. 23. 2306(b) 41:153(b) (1st 14 words of 1st sentence). 41:153(a) (less 1st sentence). 2306(c) 41:153(b) (2d sentence). 2306(d) 41:153(b) (1st sentence, less 1st 14 words). 2306(e) 41:153(b) (less 1st and 2d sentences; and less words after semicolon of last sentence). -------------------------------------------------------------------- In subsection (a), the words "subject to subsections (b)-(e)" are substituted for the words "Except as provided in subsection (b) of this section". The words "United States" are substituted for the word "Government". In subsection (b), the words "under section 2304 of this title" are substituted for the words "pursuant to section 151(c) of this title". The words "full amount of such" and "violation" are omitted as surplusage. In subsection (c), the words "under section 2304 of this title" are inserted for clarity. -COD- CODIFICATION Pub. L. 99-591 is a corrected version of Pub. L. 99-500. -MISC2- PRIOR PROVISIONS Provisions similar to those in subsec. (h)(11) of this section were contained in Pub. L. 100-526, title I, Sec. 104(a), Oct. 24, 1988, 102 Stat. 2624, which was set out below, prior to repeal by Pub. L. 101-189, Sec. 805(b). AMENDMENTS 2011 - Subsec. (c). Pub. L. 112-81 added subsec. (c). 2003 - Subsec. (e). Pub. L. 108-136 substituted "(1) Except as provided in paragraph (2), each" for "Each", redesignated former pars. (1) and (2) as subpars. (A) and (B) of par. (1), respectively, redesignated cls. (A) and (B) of former par. (2) as cls. (i) and (ii) of subpar. (B) of par. (1), respectively, and added par. (2). 2000 - Subsec. (g). Pub. L. 106-398 amended subsec. (g) generally. Prior to amendment, subsec. (g) consisted of pars. (1) to (3) authorizing the head of an agency to enter into contracts for periods of not more than five years for certain types of services. 1997 - Subsec. (h). Pub. L. 105-85 inserted "for the purchase of property" after "Multiyear contracting authority". 1994 - Subsec. (b). Pub. L. 103-355, Secs. 4102(b), 8105(a), inserted at end "This subsection does not apply to a contract that is for an amount not greater than the simplified acquisition threshold or to a contract for the acquisition of commercial items." Subsec. (c). Pub. L. 103-355, Sec. 1021, struck out subsec. (c) which read as follows: "No cost contract, cost-plus-a-fixed-fee contract, or incentive contract may be made under this chapter unless the head of the agency determines that such a contract is likely to be less costly to the United States than any other kind of contract or that it is impracticable to obtain property or services of the kind or quality required except under such a contract." Subsec. (e)(2)(A). Pub. L. 103-355, Sec. 4401(c), substituted "simplified acquisition threshold" for "small purchase threshold". Subsec. (h). Pub. L. 103-355, Sec. 1022(b), amended subsec. (h) generally. Prior to amendment, subsec. (h) related to requirements for multiyear contracts for purchase of property, including weapon systems and items and services associated with weapons systems. 1991 - Subsec. (e)(2)(A). Pub. L. 102-25 substituted "the small purchase threshold" for "the small purchase amount under section 2304(g) of this title". 1990 - Subsec. (h)(1). Pub. L. 101-510, Sec. 808(a), struck out "(other than contracts described in paragraph (6))" after "multiyear contracts" in introductory provisions and substituted "substantial savings of the total anticipated costs of carrying out the program through annual contracts" for "reduced total costs under the contract" in subpar. (A). Subsec. (h)(6). Pub. L. 101-510, Sec. 808(b), struck out "contracts for the construction, alteration, or major repair of improvements to real property or" after "not apply to". Subsec. (h)(9). Pub. L. 101-510, Sec. 808(c)(1), inserted "for a defense acquisition program that has been specifically authorized by law to be carried out using multiyear contract authority" after "under this subsection" in introductory provisions. Subsec. (h)(9)(C). Pub. L. 101-510, Sec. 808(c)(2), struck out subpar. (C) which read as follows: "The proposed multiyear contract - "(i) achieves a 10 percent savings as compared to the cost of current negotiated contracts, adjusted for changes in quantity and for inflation; or "(ii) achieves a 10 percent savings as compared to annual contracts if no recent contract experience exists." 1989 - Subsec. (h)(9) to (11). Pub. L. 101-189 added pars. (9) to (11). 1986 - Pub. L. 99-500 and Pub. L. 99-591, Sec. 101(c) [Sec. 952(c)(1)], Pub. L. 99-661, Sec. 952(c)(1), amended section identically, striking out ": cost or pricing data: truth in negotiation" after "contracts" in section catchline. Subsec. (f). Pub. L. 99-500 and Pub. L. 99-591, Sec. 101(c) [Sec. 952(b)(1)], Pub. L. 99-661, Sec. 952(b)(1), amended generally subsec. (f) identically, substituting provision that "truth-in- negotiations" provisions relating to cost and pricing data for contractors and subcontractors are provided in section 2306a of this title for provision relating to certification by contractors and subcontractors on cost and pricing data, circumstances under which such certification will be required, circumstances under which such certification, although not required, may be requested, and evaluation of the accuracy of the data submitted. 1985 - Subsec. (a). Pub. L. 99-145, Sec. 1303(a)(15)(A), inserted a period at end. Subsec. (b). Pub. L. 99-145, Sec. 1303(a)(15)(B), struck out "of this title" before "shall contain". 1984 - Pub. L. 98-369, Sec. 2724(f), substituted "Kinds of contracts; cost or pricing data: truth in negotiation" for "Kinds of contracts" in section catchline. Subsec. (a). Pub. L. 98-369, Sec. 2724(a), substituted "the limitation in the preceding sentence, the other provisions of this section, and other applicable provisions of law, the head of an agency, in awarding contracts under this chapter after using procedures other than sealed-bid procedures, may enter into" for "this limitation and subject to subsections (b)-(f), the head of any agency may, in negotiating contracts under section 2304 of this title, make". Subsec. (b). Pub. L. 98-369, Sec. 2724(b), substituted "awarded under this chapter after using procedures other than sealed-bid procedures" for "negotiated under section 2304". Subsec. (c). Pub. L. 98-369, Sec. 2724(c), substituted "this chapter" for "section 2304 of this title,". Subsec. (e)(2). Pub. L. 98-369, Sec. 2724(d), substituted "the greater of (A) the small purchase amount under section 2304(g) of this title, or (B)" for "$25,000 or". Subsec. (f)(1). Pub. L. 98-369, Sec. 2724(e)(A)(i), (ii), substituted "such contractor's or subcontractor's" for "his" and struck out "he" before "submitted was accurate" in provisions preceding subpar. (A). Subsec. (f)(1)(A). Pub. L. 98-369, Sec. 2724(3)(A)(iii), (vi), (vii), substituted "prime contract under this chapter entered into after using procedures other than sealed-bid procedures, if" for "negotiated prime contract under this title where", "$100,000" for "$500,000", and "before" for "prior to". Subsec. (f)(1)(B). Pub. L. 98-369, Sec. 2724(e)(A)(iv), (vi), (vii), substituted "if" for "for which", "$100,000" for "$500,000", and "before" for "prior to". Subsec. (f)(1)(C). Pub. L. 98-369, Sec. 2724(e)(A)(v)-(vii), substituted "when" for "where", "$100,000" for "$500,000", and "before" for "prior to". Subsec. (f)(1)(D). Pub. L. 98-369, Sec. 2724(e)(A)(iv), (vi), (vii), substituted "if" for "for which", "$100,000" for "$500,000", and "before" for "prior to". Subsec. (f)(2). Pub. L. 98-369, Sec. 2724(e)(B), (D), (E), struck out "negotiated" before "price as is practicable" and before "is based on adequate price competition", redesignated as par. (3) the proviso formerly set out in this par., and as part of the redesignation substituted a period for ": Provided, That" after "or noncurrent". Subsec. (f)(3). Pub. L. 98-369, Sec. 2724(e)(E), designated as par. (3) the proviso formerly set out in par. (2). Former par. (3) redesignated (5). Subsec. (f)(4). Pub. L. 98-369, Sec. 2724(e)(F), added par. (4). Subsec. (f)(5). Pub. L. 98-369, Sec. 2724(e)(C), redesignated former par. (3) as (5) and substituted "proposal for the contract, the discussions conducted on the proposal" for "negotiation". 1981 - Subsec. (f)(1). Pub. L. 97-86, Sec. 907(b), substituted "$500,000" for "$100,000" in subpars. (A) to (D). Subsec. (g)(1). Pub. L 97-86, Sec. 909(b)(1), struck out "to be performed outside the forty-eight contiguous States and the District of Columbia" after "(and items of supply related to such services)" in provisions preceding subpar. (A). Subsec. (h). Pub. L. 97-86, Sec. 909(b)(2), added subsec. (h). 1980 - Subsec. (f). Pub. L. 96-513, Sec. 511(77)(A), designated existing provisions as pars. (1) to (3) and in par. (1), as so designated, substituted "(A)" to "(D)" for "(1)" to "(4)", respectively, "prior" for "Prior" wherever appearing, and "clause (C)" for "(3) above". Subsec. (g). Pub. L. 96-513, Sec. 511(77)(B), in par. (1) substituted "that - " for "that:", in par. (2) substituted "(A) The" for "(A) the", "(B) Consideration" for "(B) consideration", and "(C) Consideration" for "(C) consideration", and in par. (3) substituted "from - " for "from:". 1968 - Subsec. (f). Pub. L. 90-512 inserted last par. Subsec. (g). Pub. L. 90-378 added subsec. (g). 1962 - Subsec. (a). Pub. L. 87-653, Sec. 1(d), substituted "subsections (b)-(f)" for "subsections (b)-(e)". Subsec. (f). Pub. L. 87-653, Sec. 1(e), added subsec. (f). EFFECTIVE DATE OF 2011 AMENDMENT Pub. L. 112-81, div. B, title XXVIII, Sec. 2801(b), Dec. 31, 2011, 125 Stat. 1684, provided that: "Subsection (c) of section 2306 of title 10, United States Code, as added by subsection (a), shall apply with respect to any contract entered into by the United States in connection with a military construction project or a military family housing project after the date of the enactment of this Act [Dec. 31, 2011]." EFFECTIVE DATE OF 1994 AMENDMENT For effective date and applicability of amendment by Pub. L. 103- 355, see section 10001 of Pub. L. 103-355, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1986 AMENDMENT Amendment by section 101(c) [title X, Sec. 952(b)(1)] of Pub. L. 99-500 and Pub. L. 99-591, and section 952(b)(1) of Pub. L. 99-661 applicable with respect to contracts or modifications on contracts entered into after end of 120-day period beginning Oct. 18, 1986, see section 101(c) of Pub. L. 99-500 and Pub. L. 99-591, and section 952(d) of Pub. L. 99-661, set out as a note under section 2306a of this title. EFFECTIVE DATE OF 1984 AMENDMENT Amendment by Pub. L. 98-369 applicable with respect to any solicitation for bids or proposals issued after Mar. 31, 1985, see section 2751 of Pub. L. 98-369, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1980 AMENDMENT Amendment by Pub. L. 96-513 effective Dec. 12, 1980, see section 701(b)(3) of Pub. L. 96-513, set out as a note under section 101 of this title. EFFECTIVE DATE OF 1962 AMENDMENT For effective date of amendment by Pub. L. 87-653 see section 1(h) of Pub. L. 87-653, set out as a note under section 2304 of this title. TRANSITION PROVISION Section 805(c) of Pub. L. 101-189 provided that: "Subparagraph (C) of paragraph (9) of section 2306(h) of title 10, United States Code, as added by subsection (a), does not apply to programs that are under a multiyear contract on the date of the enactment of this Act [Nov. 29, 1989]." DETERMINATION OF CONTRACT TYPE FOR DEVELOPMENT PROGRAMS Pub. L. 109-364, div. A, title VIII, Sec. 818(b)-(e), Oct. 17, 2006, 120 Stat. 2329, 2330, provided that: "(b) Modification of Regulations. - Not later than 120 days after the date of the enactment of this Act [Oct. 17, 2006], the Secretary of Defense shall modify the regulations of the Department of Defense regarding the determination of contract type for development programs. "(c) Elements. - As modified under subsection (b), the regulations shall require the Milestone Decision Authority for a major defense acquisition program to select the contract type for a development program at the time of a decision on Milestone B approval (or Key Decision Point B approval in the case of a space program) that is consistent with the level of program risk for the program. The Milestone Decision Authority may select - "(1) a fixed-price type contract (including a fixed price incentive contract); or "(2) a cost type contract. "(d) Conditions With Respect to Authorization of Cost Type Contract. - As modified under subsection (b), the regulations shall provide that the Milestone Decision Authority may authorize the use of a cost type contract under subsection (c) for a development program only upon a written determination that - "(1) the program is so complex and technically challenging that it would not be practicable to reduce program risk to a level that would permit the use of a fixed-price type contract; and "(2) the complexity and technical challenge of the program is not the result of a failure to meet the requirements established in section 2366a of title 10, United States Code. "(e) Justification for Selection of Contract Type. - As modified under subsection (b), the regulations shall require the Milestone Decision Authority to document the basis for the contract type selected for a program. The documentation shall include an explanation of the level of program risk for the program and, if the Milestone Decision Authority determines that the level of program risk is high, the steps that have been taken to reduce program risk and reasons for proceeding with Milestone B approval despite the high level of program risk." MULTIYEAR PROCUREMENT AUTHORITY; REQUESTS FOR RELIEF Pub. L. 100-526, title I, Sec. 104(a), Oct. 24, 1988, 102 Stat. 2624, which provided that if for any fiscal year a multiyear contract was to be entered into under 10 U.S.C. 2306(h) was authorized by law for a particular procurement program and that authorization was subject to certain conditions established by law (including a condition as to cost savings to be achieved under the multiyear contract in comparison to specified other contracts) and if it appeared (after negotiations with contractors) that such savings could not be achieved, but that substantial savings could nevertheless be achieved through the use of a multiyear contract rather than specified other contracts, the President was to submit to Congress a request for relief from the specified cost savings that was to be achieved through multiyear contracting for that program and that any such request by the President was to include details about the request for a multiyear contract, including details about the negotiated contract terms and conditions, was repealed and restated as subsec. (h)(11) of this section by Pub. L. 101-189, Sec. 805(b), (c). TECHNICAL DATA AND COMPUTER SOFTWARE PACKAGES; PROCUREMENT; CONTRACTING PERIOD; DEFERRED ORDERING CLAUSE; EXEMPTIONS; REPORT TO CONGRESSIONAL COMMITTEES; DEFINITIONS Pub. L. 94-361, title VIII, Sec. 805, July 14, 1976, 90 Stat. 932, required that military contracts entered into during Oct. 1, 1976 to Sept. 30, 1978 for development or procurement of a major system include a deferred ordering clause with an option to purchase from the contractor technical data and computer software packages relating to the system, directed that such clause require such packages to be sufficiently detailed so as to enable procurement of such system or subsystem from another contractor, authorized that a particular contract may be exempted from the deferred ordering clause if the procuring authority reports to the House and Senate Committees on Armed Services his intent to so contract with an explanation for the exemption, and set out definitions for "major system", "deferred ordering", and "technical data". -End- -CITE- 10 USC Sec. 2306a 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2306a. Cost or pricing data: truth in negotiations -STATUTE- (a) Required Cost or Pricing Data and Certification. - (1) The head of an agency shall require offerors, contractors, and subcontractors to make cost or pricing data available as follows: (A) An offeror for a prime contract under this chapter to be entered into using procedures other than sealed-bid procedures shall be required to submit cost or pricing data before the award of a contract if - (i) in the case of a prime contract entered into after December 5, 1990, the price of the contract to the United States is expected to exceed $500,000; and (ii) in the case of a prime contract entered into on or before December 5, 1990, the price of the contract to the United States is expected to exceed $100,000. (B) The contractor for a prime contract under this chapter shall be required to submit cost or pricing data before the pricing of a change or modification to the contract if - (i) in the case of a change or modification made to a prime contract referred to in subparagraph (A)(i), the price adjustment is expected to exceed $500,000; (ii) in the case of a change or modification made after December 5, 1991, to a prime contract that was entered into on or before December 5, 1990, and that has been modified pursuant to paragraph (6), the price adjustment is expected to exceed $500,000; and (iii) in the case of a change or modification not covered by clause (i) or (ii), the price adjustment is expected to exceed $100,000. (C) An offeror for a subcontract (at any tier) of a contract under this chapter shall be required to submit cost or pricing data before the award of the subcontract if the prime contractor and each higher-tier subcontractor have been required to make available cost or pricing data under this section and - (i) in the case of a subcontract under a prime contract referred to in subparagraph (A)(i), the price of the subcontract is expected to exceed $500,000; (ii) in the case of a subcontract entered into after December 5, 1991, under a prime contract that was entered into on or before December 5, 1990, and that has been modified pursuant to paragraph (6), the price of the subcontract is expected to exceed $500,000; and (iii) in the case of a subcontract not covered by clause (i) or (ii), the price of the subcontract is expected to exceed $100,000. (D) The subcontractor for a subcontract covered by subparagraph (C) shall be required to submit cost or pricing data before the pricing of a change or modification to the subcontract if - (i) in the case of a change or modification to a subcontract referred to in subparagraph (C)(i) or (C)(ii), the price adjustment is expected to exceed $500,000; and (ii) in the case of a change or modification to a subcontract referred to in subparagraph (C)(iii), the price adjustment is expected to exceed $100,000. (2) A person required, as an offeror, contractor, or subcontractor, to submit cost or pricing data under paragraph (1) (or required by the head of the agency concerned to submit such data under subsection (c)) shall be required to certify that, to the best of the person's knowledge and belief, the cost or pricing data submitted are accurate, complete, and current. (3) Cost or pricing data required to be submitted under paragraph (1) (or under subsection (c)), and a certification required to be submitted under paragraph (2), shall be submitted - (A) in the case of a submission by a prime contractor (or an offeror for a prime contract), to the contracting officer for the contract (or to a designated representative of the contracting officer); or (B) in the case of a submission by a subcontractor (or an offeror for a subcontract), to the prime contractor. (4) Except as provided under subsection (b), this section applies to contracts entered into by the head of an agency on behalf of a foreign government. (5) A waiver of requirements for submission of certified cost or pricing data that is granted under subsection (b)(1)(C) in the case of a contract or subcontract does not waive the requirement under paragraph (1)(C) for submission of cost or pricing data in the case of subcontracts under that contract or subcontract unless the head of the procuring activity granting the waiver determines that the requirement under that paragraph should be waived in the case of such subcontracts and justifies in writing the reasons for the determination. (6) Upon the request of a contractor that was required to submit cost or pricing data under paragraph (1) in connection with a prime contract entered into on or before December 5, 1990, the head of the agency that entered into such contract shall modify the contract to reflect subparagraphs (B)(ii) and (C)(ii) of paragraph (1). All such modifications shall be made without requiring consideration. (7) Effective on October 1 of each year that is divisible by 5, each amount set forth in paragraph (1) shall be adjusted to the amount that is equal to the fiscal year 1994 constant dollar value of the amount set forth. Any amount, as so adjusted, that is not evenly divisible by $50,000 shall be rounded to the nearest multiple of $50,000. In the case of an amount that is evenly divisible by $25,000 but not evenly divisible by $50,000, the amount shall be rounded to the next higher multiple of $50,000. (b) Exceptions. - (1) In general. - Submission of certified cost or pricing data shall not be required under subsection (a) in the case of a contract, a subcontract, or modification of a contract or subcontract - (A) for which the price agreed upon is based on - (i) adequate price competition; or (ii) prices set by law or regulation; (B) for the acquisition of a commercial item; or (C) in an exceptional case when the head of the procuring activity, without delegation, determines that the requirements of this section may be waived and justifies in writing the reasons for such determination. (2) Modifications of contracts and subcontracts for commercial items. - In the case of a modification of a contract or subcontract for a commercial item that is not covered by the exception to the submission of certified cost or pricing data in paragraph (1)(A) or (1)(B), submission of certified cost or pricing data shall not be required under subsection (a) if - (A) the contract or subcontract being modified is a contract or subcontract for which submission of certified cost or pricing data may not be required by reason of paragraph (1)(A) or (1)(B); and (B) the modification would not change the contract or subcontract, as the case may be, from a contract or subcontract for the acquisition of a commercial item to a contract or subcontract for the acquisition of an item other than a commercial item. (3) Noncommercial modifications of commercial items. - (A) The exception in paragraph (1)(B) does not apply to cost or pricing data on noncommercial modifications of a commercial item that are expected to cost, in the aggregate, more than the amount specified in subsection (a)(1)(A)(i), as adjusted from time to time under subsection (a)(7), or 5 percent of the total price of the contract (at the time of contract award), whichever is greater. (B) In this paragraph, the term "noncommercial modification", with respect to a commercial item, means a modification of such item that is not a modification described in section 4(12)(C)(i) (!1) of the Office of Federal Procurement Policy Act (41 U.S.C. 403(12)(C)(i)). (C) Nothing in subparagraph (A) shall be construed - (i) to limit the applicability of the exception in subparagraph (A) or (C) of paragraph (1) to cost or pricing data on a noncommercial modification of a commercial item; or (ii) to require the submission of cost or pricing data on any aspect of an acquisition of a commercial item other than the cost and pricing of noncommercial modifications of such item. (c) Cost or Pricing Data on Below-Threshold Contracts. - (1) Authority to require submission. - Subject to paragraph (2), when certified cost or pricing data are not required to be submitted by subsection (a) for a contract, subcontract, or modification of a contract or subcontract, such data may nevertheless be required to be submitted by the head of the procuring activity, but only if the head of the procuring activity determines that such data are necessary for the evaluation by the agency of the reasonableness of the price of the contract, subcontract, or modification of a contract or subcontract. In any case in which the head of the procuring activity requires such data to be submitted under this subsection, the head of the procuring activity shall justify in writing the reason for such requirement. (2) Exception. - The head of the procuring activity may not require certified cost or pricing data to be submitted under this paragraph for any contract or subcontract, or modification of a contract or subcontract, covered by the exceptions in subparagraph (A) or (B) of subsection (b)(1). (3) Delegation of authority prohibited. - The head of a procuring activity may not delegate functions under this paragraph. (d) Submission of Other Information. - (1) Authority to require submission. - When certified cost or pricing data are not required to be submitted under this section for a contract, subcontract, or modification of a contract or subcontract, the contracting officer shall require submission of data other than certified cost or pricing data to the extent necessary to determine the reasonableness of the price of the contract, subcontract, or modification of the contract or subcontract. Except in the case of a contract or subcontract covered by the exceptions in subsection (b)(1)(A), the contracting officer shall require that the data submitted include, at a minimum, appropriate information on the prices at which the same item or similar items have previously been sold that is adequate for evaluating the reasonableness of the price for the procurement. (2) Limitations on authority. - The Federal Acquisition Regulation shall include the following provisions regarding the types of information that contracting officers may require under paragraph (1): (A) Reasonable limitations on requests for sales data relating to commercial items. (B) A requirement that a contracting officer limit, to the maximum extent practicable, the scope of any request for information relating to commercial items from an offeror to only that information that is in the form regularly maintained by the offeror in commercial operations. (C) A statement that any information received relating to commercial items that is exempt from disclosure under section 552(b) of title 5 shall not be disclosed by the Federal Government. (e) Price Reductions for Defective Cost or Pricing Data. - (1)(A) A prime contract (or change or modification to a prime contract) under which a certificate under subsection (a)(2) is required shall contain a provision that the price of the contract to the United States, including profit or fee, shall be adjusted to exclude any significant amount by which it may be determined by the head of the agency that such price was increased because the contractor (or any subcontractor required to make available such a certificate) submitted defective cost or pricing data. (B) For the purposes of this section, defective cost or pricing data are cost or pricing data which, as of the date of agreement on the price of the contract (or another date agreed upon between the parties), were inaccurate, incomplete, or noncurrent. If for purposes of the preceding sentence the parties agree upon a date other than the date of agreement on the price of the contract, the date agreed upon by the parties shall be as close to the date of agreement on the price of the contract as is practicable. (2) In determining for purposes of a contract price adjustment under a contract provision required by paragraph (1) whether, and to what extent, a contract price was increased because the contractor (or a subcontractor) submitted defective cost or pricing data, it shall be a defense that the United States did not rely on the defective data submitted by the contractor or subcontractor. (3) It is not a defense to an adjustment of the price of a contract under a contract provision required by paragraph (1) that - (A) the price of the contract would not have been modified even if accurate, complete, and current cost or pricing data had been submitted by the contractor or subcontractor because the contractor or subcontractor - (i) was the sole source of the property or services procured; or (ii) otherwise was in a superior bargaining position with respect to the property or services procured; (B) the contracting officer should have known that the cost and pricing data in issue were defective even though the contractor or subcontractor took no affirmative action to bring the character of the data to the attention of the contracting officer; (C) the contract was based on an agreement between the contractor and the United States about the total cost of the contract and there was no agreement about the cost of each item procured under such contract; or (D) the prime contractor or subcontractor did not submit a certification of cost and pricing data relating to the contract as required under subsection (a)(2). (4)(A) A contractor shall be allowed to offset an amount against the amount of a contract price adjustment under a contract provision required by paragraph (1) if - (i) the contractor certifies to the contracting officer (or to a designated representative of the contracting officer) that, to the best of the contractor's knowledge and belief, the contractor is entitled to the offset; and (ii) the contractor proves that the cost or pricing data were available before the date of agreement on the price of the contract (or price of the modification) or, if applicable consistent with paragraph (1)(B), another date agreed upon between the parties, and that the data were not submitted as specified in subsection (a)(3) before such date. (B) A contractor shall not be allowed to offset an amount otherwise authorized to be offset under subparagraph (A) if - (i) the certification under subsection (a)(2) with respect to the cost or pricing data involved was known to be false when signed; or (ii) the United States proves that, had the cost or pricing data referred to in subparagraph (A)(ii) been submitted to the United States before the date of agreement on the price of the contract (or price of the modification) or, if applicable consistent with paragraph (1)(B), another date agreed upon between the parties, the submission of such cost or pricing data would not have resulted in an increase in that price in the amount to be offset. (f) Interest and Penalties for Certain Overpayments. - (1) If the United States makes an overpayment to a contractor under a contract subject to this section and the overpayment was due to the submission by the contractor of defective cost or pricing data, the contractor shall be liable to the United States - (A) for interest on the amount of such overpayment, to be computed - (i) for the period beginning on the date the overpayment was made to the contractor and ending on the date the contractor repays the amount of such overpayment to the United States; and (ii) at the current rate prescribed by the Secretary of the Treasury under section 6621 of the Internal Revenue Code of 1986; and (B) if the submission of such defective data was a knowing submission, for an additional amount equal to the amount of the overpayment. (2) Any liability under this subsection of a contractor that submits cost or pricing data but refuses to submit the certification required by subsection (a)(2) with respect to the cost or pricing data shall not be affected by the refusal to submit such certification. (g) Right of United States To Examine Contractor Records. - For the purpose of evaluating the accuracy, completeness, and currency of cost or pricing data required to be submitted by this section, the head of an agency shall have the authority provided by section 2313(a)(2) of this title. (h) Definitions. - In this section: (1) Cost or pricing data. - The term "cost or pricing data" means all facts that, as of the date of agreement on the price of a contract (or the price of a contract modification), or, if applicable consistent with subsection (e)(1)(B), another date agreed upon between the parties, a prudent buyer or seller would reasonably expect to affect price negotiations significantly. Such term does not include information that is judgmental, but does include the factual information from which a judgment was derived. (2) Subcontract. - The term "subcontract" includes a transfer of commercial items between divisions, subsidiaries, or affiliates of a contractor or a subcontractor. (3) Commercial item. - The term "commercial item" has the meaning provided such term in section 103 of title 41. -SOURCE- (Added Pub. L. 99-500, Sec. 101(c) [title X, Sec. 952(a)], Oct. 18, 1986, 100 Stat. 1783-82, 1783-166, and Pub. L. 99-591, Sec. 101(c) [title X, Sec. 952(a)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-166; Pub. L. 99-661, div. A, title IX, formerly title IV, Sec. 952(a), Nov. 14, 1986, 100 Stat. 3945, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; amended Pub. L. 100-180, div. A, title VIII, Sec. 804(a), (b), Dec. 4, 1987, 101 Stat. 1125; Pub. L. 101-510, div. A, title VIII, Sec. 803(a)(1), (d), Nov. 5, 1990, 104 Stat. 1589, 1590; Pub. L. 102-25, title VII, Sec. 701(b), (f)(8), Apr. 6, 1991, 105 Stat. 113, 115; Pub. L. 102-190, div. A, title VIII, Sec. 804(a)-(c)(1), title X, Sec. 1061(a)(9), Dec. 5, 1991, 105 Stat. 1415, 1416, 1472; Pub. L. 103-355, title I, Secs. 1201-1209, Oct. 13, 1994, 108 Stat. 3273-3277; Pub. L. 104-106, div. D, title XLII, Sec. 4201(a), title XLIII, Sec. 4321(a)(2), (b)(7), Feb. 10, 1996, 110 Stat. 649, 671, 672; Pub. L. 104-201, div. A, title X, Sec. 1074(a)(12), Sept. 23, 1996, 110 Stat. 2659; Pub. L. 105-85, div. A, title X, Sec. 1073(a)(46), Nov. 18, 1997, 111 Stat. 1902; Pub. L. 105-261, div. A, title VIII, Secs. 805(a), 808(a), Oct. 17, 1998, 112 Stat. 2083, 2085; Pub. L. 108-375, div. A, title VIII, Sec. 818(a), Oct. 28, 2004, 118 Stat. 2015; Pub. L. 110-181, div. A, title VIII, Sec. 814, Jan. 28, 2008, 122 Stat. 222; Pub. L. 111-350, Sec. 5(b)(15), Jan. 4, 2011, 124 Stat. 3843.) -REFTEXT- REFERENCES IN TEXT Section 4(12)(C)(i) of the Office of Federal Procurement Policy Act, referred to in subsec. (b)(3)(B), means section 4(12)(C)(i) of Pub. L. 93-400, which was classified to section 403(12)(C)(i) of former Title 41, Public Contracts, and was repealed and restated as section 103(3)(A) of Title 41, Public Contracts, by Pub. L. 111- 350, Secs. 3, 7(b), Jan. 4, 2011, 124 Stat. 3677, 3855. Section 6621 of the Internal Revenue Code of 1986, referred to in subsec. (f)(1)(A)(ii), is classified to section 6621 of Title 26, Internal Revenue Code. -COD- CODIFICATION Pub. L. 99-591 is a corrected version of Pub. L. 99-500. Pub. L. 99-500, Pub. L. 99-591, and Pub. L. 99-661 added identical sections. -MISC1- AMENDMENTS 2011 - Subsec. (h)(3). Pub. L. 111-350 substituted "section 103 of title 41" for "section 4(12) of the Office of Federal Procurement Policy Act (41 U.S.C. 403(12))". 2008 - Subsec. (b)(3)(A). Pub. L. 110-181 substituted "the amount specified in subsection (a)(1)(A)(i), as adjusted from time to time under subsection (a)(7)," for "$500,000" and inserted "(at the time of contract award)" after "total price of the contract". 2004 - Subsec. (b)(3). Pub. L. 108-375 added par. (3). 1998 - Subsec. (a)(5). Pub. L. 105-261, Sec. 805(a), amended par. (5) generally. Prior to amendment, par. (5) read as follows: "For purposes of paragraph (1)(C), a contractor or subcontractor granted a waiver under subsection (b)(1)(C) shall be considered as having been required to make available cost or pricing data under this section." Subsec. (d)(1). Pub. L. 105-261, Sec. 808(a), substituted "the contracting officer shall require that the data submitted" for "the data submitted shall". 1997 - Subsec. (a)(5). Pub. L. 105-85 substituted "subsection (b)(1)(C)" for "subsection (b)(1)(B)". 1996 - Subsec. (b). Pub. L. 104-106, Sec. 4321(a)(2), made technical correction to directory language of Pub. L. 103-355, Sec. 1202(a). See 1994 Amendment note below. Pub. L. 104-106, Sec. 4201(a)(1), amended subsec. (b) generally, revising and restating as pars. (1) and (2) the provisions of former pars. (1) and (2) and striking out par. (3). Subsec. (c). Pub. L. 104-106, Sec. 4201(a)(1), amended subsec. (c) generally, revising and restating as subsec. (c) the provisions of former subsec. (c)(1). Subsec. (d). Pub. L. 104-106, Sec. 4321(b)(7)(A), which directed amendment of subsec. (d)(2)(A)(ii), by inserting "to" after "The information referred", could not be executed because subsec. (d)(2)(A) did not contain a cl. (ii) or the language "The information referred" subsequent to amendment by Pub. L. 104-106, Sec. 4201(a)(1). See below. Pub. L. 104-106, Sec. 4201(a)(1), amended subsec. (d) generally, revising and restating as pars. (1) and (2) provisions of former subsecs. (c)(2) and (d)(2), (4) and striking out provisions of former subsec. (d)(1), (3) relating to procurements based on adequate price competition and authority to audit. Subsec. (e)(4)(B)(ii). Pub. L. 104-106, Sec. 4321(b)(7)(B), struck out second comma after "parties". Subsec. (h). Pub. L. 104-106, Sec. 4201(a)(2), redesignated subsec. (i) as (h) and struck out former subsec. (h) which read as follows: "Required Regulations. - The Federal Acquisition Regulation shall contain provisions concerning the types of information that offerors must submit for a contracting officer to consider in determining whether the price of a procurement to the Government is fair and reasonable when certified cost or pricing data are not required to be submitted under this section because the price of the procurement to the United States is not expected to exceed the applicable threshold amount set forth in subsection (a) (as adjusted pursuant to paragraph (7) of such subsection). Such information, at a minimum, shall include appropriate information on the prices at which the same item or similar items have previously been sold that is adequate for evaluating the reasonableness of the price of the proposed contract or subcontract for the procurement." Subsec. (h)(3). Pub. L. 104-201 inserted "(41 U.S.C. 403(12))" before period at end. Subsec. (i). Pub. L. 104-106, Sec. 4201(a)(2)(B), redesignated subsec. (i) as (h). Subsec. (i)(3). Pub. L. 104-106, Sec. 4321(b)(7)(C), which directed amendment of subsec. (i)(3) by inserting "(41 U.S.C. 403(12))" before period at end, could not be executed because section did not contain a subsec. (i) subsequent to the amendment by Pub. L. 104-106, Sec. 4201(a)(2)(B), redesignating subsec. (i) as (h). See above. 1994 - Subsec. (a)(1)(A)(i). Pub. L. 103-355, Sec. 1201(a)(1), struck out "and before January 1, 1996," after "December 5, 1990,". Subsec. (a)(1)(A)(ii). Pub. L. 103-355, Sec. 1201(a)(2), struck out "or after December 31, 1995," after "December 5, 1990,". Subsec. (a)(5). Pub. L. 103-355, Sec. 1202(b), substituted "subsection (b)(1)(B)" for "subsection (b)(2)". Subsec. (a)(6). Pub. L. 103-355, Sec. 1201(c), struck out subpar. (A) designation and subpar. (B) which read as follows: "The head of an agency is not required to modify a contract under subparagraph (A) if that head of an agency determines that the submission of cost or pricing data with respect to that contract should be required under subsection (c)." Subsec. (a)(7). Pub. L. 103-355, Sec. 1201(b), added par. (7). Subsec. (b). Pub. L. 103-355, Sec. 1202(a), as amended by Pub. L. 104-106, Sec. 4321(a)(2), amended heading and text of subsec. (b) generally. Prior to amendment, text read as follows: "This section need not be applied to a contract or subcontract - "(1) for which the price agreed upon is based on - "(A) adequate price competition; "(B) established catalog or market prices of commercial items sold in substantial quantities to the general public; or "(C) prices set by law or regulation; or "(2) in an exceptional case when the head of the agency determines that the requirements of this section may be waived and states in writing his reasons for such determination." Subsec. (c). Pub. L. 103-355, Sec. 1203, amended heading and text of subsec. (c) generally. Prior to amendment, text read as follows: "When cost or pricing data are not required to be submitted by subsection (a), such data may nevertheless be required to be submitted by the head of the agency if the head of the agency determines that such data are necessary for the evaluation by the agency of the reasonableness of the price of the contract or subcontract. In any case in which the head of the agency requires such data to be submitted under this subsection, the head of the agency shall document in writing the reasons for such requirement." Subsec. (d). Pub. L. 103-355, Sec. 1204, added subsec. (d) and redesignated former subsec. (d) as (e). Subsec. (e). Pub. L. 103-355, Sec. 1204(1), redesignated subsec. (d) as (e). Former subsec. (e) redesignated (f). Subsec. (e)(4)(A)(ii), (B)(ii). Pub. L. 103-355, Sec. 1207, inserted "or, if applicable consistent with paragraph (1)(B), another date agreed upon between the parties," after "(or price of the modification)". Subsec. (f). Pub. L. 103-355, Sec. 1204(1), redesignated subsec. (e) as (f). Former subsec. (f) redesignated (g). Subsec. (f)(1). Pub. L. 103-355, Sec. 1209, struck out "with the Department of Defense" before "subject to this section" in introductory provisions. Subsec. (g). Pub. L. 103-355, Sec. 1205, added subsec. (g) and struck out heading and text of former subsec. (g). Text read as follows: "(1) For the purpose of evaluating the accuracy, completeness, and currency of cost or pricing data required to be submitted by this section with respect to a contract or subcontract, the head of the agency, acting through any authorized representative of the head of the agency who is an employee of the United States or a member of the armed forces, shall have the right to examine all records of the contractor or subcontractor related to - "(A) the proposal for the contract or subcontract; "(B) the discussions conducted on the proposal; "(C) pricing of the contract or subcontract; or "(D) performance of the contract or subcontract. "(2) The right of the head of an agency under paragraph (1) shall expire three years after final payment under the contract or subcontract. "(3) In this subsection, the term 'records' includes books, documents, and other data." Pub. L. 103-355, Sec. 1204(1), redesignated subsec. (f) as (g). Former subsec. (g) redesignated (i). Subsec. (h). Pub. L. 103-355, Sec. 1206, added subsec. (h). Subsec. (i). Pub. L. 103-355, Sec. 1208, amended heading and text of subsec. (i) generally. Prior to amendment, text read as follows: "In this section, the term 'cost or pricing data' means all facts that, as of the date of agreement on the price of a contract (or the price of a contract modification), a prudent buyer or seller would reasonably expect to affect price negotiations significantly. Such term does not include information that is judgmental, but does include the factual information from which a judgment was derived." Pub. L. 103-355, Sec. 1204(1), redesignated subsec. (g) as (i). 1991 - Subsec. (a)(1)(A). Pub. L. 102-190, Sec. 804(a), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: "An offeror for a prime contract under this chapter to be entered into using procedures other than sealed-bid procedures shall be required to submit cost or pricing data before the award of the contract if the price of the contract to the United States is expected to exceed $500,000 or, in the case of a contract to be awarded after December 31, 1995, $100,000." Subsec. (a)(1)(B). Pub. L. 102-190, Sec. 804(a), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: "The contractor for a contract under this chapter shall be required to submit cost or pricing data before the pricing of a change or modification to the contract if the price adjustment is expected to exceed the dollar amount applicable under subparagraph (A) to that contract (or such lesser amount as may be prescribed by the head of the agency)." Pub. L. 102-25, Sec. 701(b)(1), substituted "the dollar amount applicable under subparagraph (A) to that contract" for "$500,000 (or such lesser amount as may be prescribed by the head of the agency) or, in the case of a change or modification to a contract to be made after December 31, 1995, $100,000". Subsec. (a)(1)(C). Pub. L. 102-190, Sec. 804(a), amended subpar. (C) generally. Prior to amendment, subpar. (C) read as follows: "An offeror for a subcontract (at any tier) of a contract under this chapter shall be required to submit cost or pricing data before the award of the subcontract if - "(i) the price of the subcontract is expected to exceed the dollar amount applicable under subparagraph (A) to the prime contract of that subcontract; and "(ii) the prime contractor and each higher-tier subcontractor have been required to make available cost or pricing data under this section." Subsec. (a)(1)(C)(i). Pub. L. 102-25, Sec. 701(b)(2), substituted "the dollar amount applicable under subparagraph (A) to the prime contract of that subcontract" for "$500,000 or, in the case of a subcontract to be awarded after December 31, 1995, $100,000". Subsec. (a)(1)(D). Pub. L. 102-190, Sec. 804(a), amended subpar. (D) generally. Prior to amendment, subpar. (D) read as follows: "The subcontractor for a subcontract covered by subparagraph (C) shall be required to submit cost or pricing data before the pricing of a change or modification to the subcontract if the price adjustment is expected to exceed the dollar amount applicable under subparagraph (A) to the prime contract of that subcontract (or such lesser amount as may be prescribed by the head of the agency)." Pub. L. 102-25, Sec. 701(b)(3), substituted "the dollar amount applicable under subparagraph (A) to the prime contract of that subcontract" for "$500,000 (or such lesser amount as may be prescribed by the head of the agency) or, in the case of a change or modification to be made after December 31, 1995, $100,000". Subsec. (a)(5). Pub. L. 102-190, Sec. 804(c)(1), substituted "paragraph (1)(C)" for "paragraph (1)(C)(ii)". Subsec. (a)(6). Pub. L. 102-190, Sec. 804(b), added par. (6). Subsec. (e)(1)(A)(i). Pub. L. 102-25, Sec. 701(f)(8), which directed the substitution of "Internal Revenue Code of 1986" for "Internal Revenue Code of 1954", could not be executed because "Internal Revenue Code of 1954" does not appear. Subsec. (e)(1)(A)(ii). Pub. L. 102-190, Sec. 1061(a)(9), substituted "Internal Revenue Code of 1986" for "Internal Revenue Code of 1954". 1990 - Subsec. (a)(1)(A). Pub. L. 101-510, Sec. 803(a)(1)(A), substituted "$500,000 or, in the case of a contract to be awarded after December 31, 1995, $100,000" for "$100,000". Subsec. (a)(1)(B). Pub. L. 101-510, Sec. 803(a)(1)(B), substituted "$500,000 (or such lesser amount as may be prescribed by the head of the agency) or, in the case of a change or modification to a contract to be made after December 31, 1995, $100,000" for "$100,000". Subsec. (a)(1)(C)(i). Pub. L. 101-510, Sec. 803(a)(1)(C), substituted "$500,000 or, in the case of a subcontract to be awarded after December 31, 1995, $100,000" for "$100,000". Subsec. (a)(1)(D). Pub. L. 101-510, Sec. 803(a)(1)(D), substituted "$500,000 (or such lesser amount as may be prescribed by the head of the agency) or, in the case of a change or modification to be made after December 31, 1995, $100,000" for "$100,000". Subsec. (c). Pub. L. 101-510, Sec. 803(d), inserted at end "In any case in which the head of the agency requires such data to be submitted under this subsection, the head of the agency shall document in writing the reasons for such requirement." 1987 - Subsec. (a)(5). Pub. L. 100-180, Sec. 804(b)(1), substituted "a waiver under subsection (b)(2)" for "such a waiver", and struck out first sentence authorizing head of an agency to waive requirement under this subsection for contractor, subcontractor, or offeror to submit cost or pricing data. Subsec. (e)(2). Pub. L. 100-180, Sec. 804(b)(2), amended par. (2) generally. Prior to amendment, par. (2) read as follows: "Except as provided under subsection (d), the liability of a contractor under this subsection shall not be affected by the contractor's refusal to submit a certification under subsection (a)(2) with respect to the cost or pricing data involved." Subsec. (g). Pub. L. 100-180, Sec. 804(a), amended subsec. (g) generally. Prior to amendment, subsec. (g) read as follows: "In this section, the term 'cost or pricing data' means all information that is verifiable and that, as of the date of agreement on the price of a contract (or the price of a contract modification), a prudent buyer or seller would reasonably expect to affect price negotiations significantly. Such term does not include information that is judgmental, but does include the factual information from which a judgment was derived." EFFECTIVE DATE OF 2004 AMENDMENT Pub. L. 108-375, div. A, title VIII, Sec. 818(b), Oct. 28, 2004, 118 Stat. 2016, as amended by Pub. L. 109-364, div. A, title X, Sec. 1071(g)(11), Oct. 17, 2006, 120 Stat. 2403, provided that: "Paragraph (3) of subsection (b) of section 2306a of title 10, United States Code (as added by subsection (a)), shall take effect on June 1, 2005, and shall apply with respect to offers submitted, and to modifications of contracts or subcontracts made, on or after that date." EFFECTIVE DATE OF 1996 AMENDMENT For effective date and applicability of amendment by sections 4201(a) and 4321(b)(7) of Pub. L. 104-106, see section 4401 of Pub. L. 104-106, set out as a note under section 2302 of this title. Section 4321(a) of Pub. L. 104-106 provided that the amendment made by that section is effective as of Oct. 13, 1994, and as if included in Pub. L. 103-355 as enacted. EFFECTIVE DATE OF 1994 AMENDMENT For effective date and applicability of amendment by Pub. L. 103- 355, see section 10001 of Pub. L. 103-355, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1990 AMENDMENT Section 803(a)(2) of Pub. L. 101-510, as amended by Pub. L. 102- 25, title VII, Sec. 704(a)(4), Apr. 6, 1991, 105 Stat. 118, provided that the amendments to this section by Pub. L. 101-510 would apply to contracts entered into after Dec. 5, 1990, subcontracts under such contracts, and modifications or changes to such contracts and subcontracts, prior to repeal by Pub. L. 102- 190, div. A, title VIII, Sec. 804(c)(2), Dec. 5, 1991, 105 Stat. 1416. EFFECTIVE DATE OF 1987 AMENDMENT Section 804(c) of Pub. L. 100-180 provided that: "(1) Subsection (a) [amending this section] shall apply to any contract, or modification of a contract, entered into after the end of the 30-day period beginning on the date of the enactment of this Act [Dec. 4, 1987]. "(2) The amendments made by subsection (b) [amending this section] shall apply with respect to contracts, or modifications of contracts, entered into after the end of the 120-day period beginning on October 18, 1986." EFFECTIVE DATE OF 1986 AMENDMENT Section 101(c) [title X, Sec. 952(d)] of Pub. L. 99-500 and Pub. L. 99-591, and section 952(d) of title IX, formerly title IV, of Pub. L. 99-661, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, provided that: "(1) Except as provided in paragraph (2), section 2306a of title 10, United States Code (as added by subsection (a)), and the amendment and repeal made by subsection (b) [amending section 2306 of this title and repealing a provision set out as a note under section 2304 of this title], shall apply with respect to contracts or modifications on contracts entered into after the end of the 120- day period beginning on the date of the enactment of this Act [Oct. 18, 1986]. "(2) Subsection (e) of such section shall apply with respect to contracts or modifications on contracts entered into after November 7, 1985." REGULATIONS Section 803(c) of Pub. L. 101-510, directed Secretary of Defense to prescribe regulations identifying type of procurements for which contracting officers should consider requiring submission of certified cost or pricing data under subsec. (c) of this section, and also directed Secretary to prescribe regulations concerning types of information that offerors had to submit for contracting officer to consider in determining whether price of procurement to Government was fair and reasonable when certified cost or pricing data were not required to be submitted under this section because price of procurement to the United States was not expected to exceed $500,000, such information, at minimum, to include appropriate information on prices at which such offeror had previously sold same or similar products, with such regulations to be prescribed not later than six months after Nov. 5, 1990, prior to repeal by Pub. L. 103-355, title I, Sec. 1210, Oct. 13, 1994, 108 Stat. 3277. PRICE TREND ANALYSIS FOR SUPPLIES AND EQUIPMENT PURCHASED BY THE DEPARTMENT OF DEFENSE Pub. L. 111-383, div. A, title VIII, Sec. 892, Jan. 7, 2011, 124 Stat. 4310, provided that: "(a) Price Trend Analysis Procedures. - "(1) In general. - The Secretary of Defense shall develop and implement procedures that, to the maximum extent practicable, provide for the collection and analysis of information on price trends for covered supplies and equipment purchased by the Department of Defense. The procedures shall include an automated process for identifying categories of covered supplies and equipment described in paragraph (2) that have experienced significant escalation in prices. "(2) Category of covered supplies and equipment. - A category of covered supplies and equipment referred to in paragraph (1) consists of covered supplies and equipment that have the same National Stock Number, are in a single Federal Supply Group or Federal Supply Class, are provided by a single contractor, or are otherwise logically grouped for the purpose of analyzing information on price trends. "(3) Requirement to examine causes of escalation. - An analysis conducted pursuant to paragraph (1) shall include, for any category in which significant escalation in prices is identified, a more detailed examination of the causes of escalation for such prices within the category and whether such price escalation is consistent across the Department of Defense. "(4) Requirement to address unjustified escalation. - The head of a Defense Agency or the Secretary of a military department shall take appropriate action to address any unjustified escalation in prices being paid for items procured by that agency or military department as identified in an analysis conducted pursuant to paragraph (1). "(b) Annual Report. - Not later than April 1 of each year, the Secretary of Defense shall submit to the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives a report on the analyses of price trends that were conducted for categories of covered supplies and equipment during the preceding fiscal year under the procedures implemented pursuant to paragraph (1). The report shall include a description of the actions taken to identify and address any unjustified price escalation for the categories of items. "(c) Definitions. - In this section: "(1) Supplies and equipment. - The term 'supplies and equipment' means items classified as supplies and equipment under the Federal Supply Classification System. "(2) Covered supplies and equipment. - The term 'covered supplies and equipment' means all supplies and equipment purchased by the Department of Defense. The term does not include major weapon systems but does include individual parts and components purchased as spare or replenishment parts for such weapon systems. "(d) Sunset Date. - This section shall not be in effect on and after April 1, 2015." GRANTS OF EXCEPTIONS TO COST OR PRICING DATA CERTIFICATION REQUIREMENTS AND WAIVERS OF COST ACCOUNTING STANDARDS Pub. L. 107-314, div. A, title VIII, Sec. 817, Dec. 2, 2002, 116 Stat. 2610, as amended by Pub. L. 112-81, div. A, title VIII, Sec. 809(a), Dec. 31, 2011, 125 Stat. 1490, provided that: "(a) Guidance for Exceptions in Exceptional Circumstances. - Not later than 60 days after the date of the enactment of this Act [Dec. 2, 2002], the Secretary of Defense shall issue guidance on the circumstances under which it is appropriate to grant an exceptional case exception or waiver with respect to certified cost and pricing data and cost accounting standards. "(b) Determination Required for Exceptional Case Exception or Waiver. - The guidance shall, at a minimum, include a limitation that a grant of an exceptional case exception or waiver is appropriate with respect to a contract, subcontract, or (in the case of submission of certified cost and pricing data) modification only upon a determination that - "(1) the property or services cannot reasonably be obtained under the contract, subcontract, or modification, as the case may be, without the grant of the exception or waiver; "(2) the price can be determined to be fair and reasonable without the submission of certified cost and pricing data or the application of cost accounting standards, as the case may be; and "(3) there are demonstrated benefits to granting the exception or waiver. "(c) Applicability of New Guidance. - The guidance issued under subsection (a) shall apply to each exceptional case exception or waiver that is granted on or after the date on which the guidance is issued. "(d) Annual Report on Both Commercial Item and Exceptional Case Exceptions and Waivers. - (1) The Secretary of Defense shall transmit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] promptly after the end of each fiscal year a report on commercial item exceptions, and exceptional case exceptions and waivers, described in paragraph (2) that were granted during that fiscal year. "(2) The report for a fiscal year shall include - "(A) with respect to any commercial item exception granted in the case of a contract, subcontract, or contract or subcontract modification that is expected to have a price of $15,000,000 or more, an explanation of the basis for the determination that the products or services to be purchased are commercial items, including an identification of the specific steps taken to ensure price reasonableness; "(B) with respect to any exceptional case exception or waiver granted in the case of a contract or subcontract that is expected to have a value of $15,000,000 or more, an explanation of the basis for the determination described in subsection (b), including an identification of the specific steps taken to ensure that the price was fair and reasonable; and "(C) with respect to any determination pursuant to section 2304a(d)(3)(D) of title 10, United States Code, that because of exceptional circumstances it is necessary in the public interest to award a task or delivery order contract with an estimated value in excess of $100,000,000 to a single source, an explanation of the basis for the determination. "(e) Definitions. - In this section: "(1) The term 'exceptional case exception or waiver' means either of the following: "(A) An exception pursuant to section 2306a(b)(1)(C) of title 10, United States Code, relating to submission of certified cost and pricing data. "(B) A waiver pursuant to section 26(f)(5)(B) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 422(f)(5)(B)) [now 41 U.S.C. 1502(b)(3)(B)], relating to the applicability of cost accounting standards to contracts and subcontracts. "(2) The term 'commercial item exception' means an exception pursuant to section 2306a(b)(1)(B) of title 10, United States Code, relating to submission of certified cost and pricing data." DEFENSE COMMERCIAL PRICING MANAGEMENT IMPROVEMENT Pub. L. 105-261, div. A, title VIII, Sec. 803, Oct. 17, 1998, 112 Stat. 2081, as amended by Pub. L. 106-65, div. A, title X, Sec. 1067(3), Oct. 5, 1999, 113 Stat. 774; Pub. L. 107-314, div. A, title VIII, Sec. 823, Dec. 2, 2002, 116 Stat. 2615; Pub. L. 109- 364, div. A, title VIII, Sec. 819, Oct. 17, 2006, 120 Stat. 2330, provided that: "(a) Modification of Pricing Regulations for Certain Commercial Items Exempt From Cost or Pricing Data Certification Requirements. - (1) The Federal Acquisition Regulation issued in accordance with sections 6 and 25 of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 405, 421) [see 41 U.S.C. 1121, 1303] shall be revised to clarify the procedures and methods to be used for determining the reasonableness of prices of exempt commercial items (as defined in subsection (d)). "(2) The regulations shall, at a minimum, provide specific guidance on - "(A) the appropriate application and precedence of such price analysis tools as catalog-based pricing, market-based pricing, historical pricing, parametric pricing, and value analysis; "(B) the circumstances under which contracting officers should require offerors of exempt commercial items to provide - "(i) information on prices at which the offeror has previously sold the same or similar items; or "(ii) other information other than certified cost or pricing data; "(C) the role and responsibility of Department of Defense support organizations in procedures for determining price reasonableness; and "(D) the meaning and appropriate application of the term 'purposes other than governmental purposes' in section 4(12) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 403(12)) [see 41 U.S.C. 103]. "(3) This subsection shall cease to be effective 1 year after the date on which final regulations prescribed pursuant to paragraph (1) take effect. "(b) Unified Management of Procurement of Exempt Commercial Items. - The Secretary of Defense shall develop and implement procedures to ensure that, whenever appropriate, a single item manager or contracting officer is responsible for negotiating and entering into all contracts from a single contractor for the procurement of exempt commercial items or for the procurement of items in a category of exempt commercial items. "(c) Commercial Price Trend Analysis. - (1) The Secretary of Defense shall develop and implement procedures that, to the maximum extent that is practicable and consistent with the efficient operation of the Department of Defense, provide for the collection and analysis of information on price trends for categories of exempt commercial items described in paragraph (2). "(2) A category of exempt commercial items referred to in paragraph (1) consists of exempt commercial items - "(A) that are in a single Federal Supply Group or Federal Supply Class, are provided by a single contractor, or are otherwise logically grouped for the purpose of analyzing information on price trends; and "(B) for which there is a potential for the price paid to be significantly higher (on a percentage basis) than the prices previously paid in procurements of the same or similar items for the Department of Defense, as determined by the head of the procuring Department of Defense agency or the Secretary of the procuring military department on the basis of criteria prescribed by the Secretary of Defense. "(3) The head of a Department of Defense agency or the Secretary of a military department shall take appropriate action to address any unreasonable escalation in prices being paid for items procured by that agency or military department as identified in an analysis conducted pursuant to paragraph (1). "(4) Not later than April 1 of each of fiscal years 2000 through 2009, the Secretary of Defense shall submit to the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives a report on the analyses of price trends that were conducted by the Secretary of each military department and the Director of the Defense Logistics Agency for categories of exempt commercial items during the preceding fiscal year under the procedures prescribed pursuant to paragraph (1). The report shall include a description of the actions taken by each Secretary and the Director to identify and address any unreasonable price escalation for the categories of items. "(d) Exempt Commercial Items Defined. - For the purposes of this section, the term 'exempt commercial item' means a commercial item that is exempt under subsection (b)(1)(B) of section 2306a of title 10, United States Code, or subsection (b)(1)(B) of section 304A of the Federal Property and Administrative Services Act of 1949 ([former] 41 U.S.C. 254b) [now 41 U.S.C. 3503(a)(2)], from the requirements for submission of certified cost or pricing data under that section." REVIEW BY INSPECTOR GENERAL Section 803(b) of Pub. L. 101-510 provided that (1) after increase in threshold for submission of cost or pricing data under subsec. (a) of this section, as amended by section 803(a) of Pub. L. 101-510, had been in effect for three years, Inspector General of Department of Defense was to conduct review of effects of increase in threshold, (2) that such review was to address whether increasing threshold improved acquisition process in terms of reduced paperwork, financial or other savings to government, an increase in number of contractors participating in defense contracting process, and adequacy of information available to contracting officers in cases in which certified cost or pricing data were not required under this section, (3) that Inspector General was to submit to Secretary of Defense a report on review conducted under paragraph (1), with Secretary of Defense required to submit such report to Congress, along with appropriate comments, upon completion of report (and comments) but not later than date on which President submitted budget to Congress pursuant to section 1105 of Title 31, Money and Finance, for fiscal year 1996, prior to repeal by Pub. L. 103-355, title I, Sec. 1210, Oct. 13, 1994, 108 Stat. 3277. -FOOTNOTE- (!1) See References in Text note below. -End- -CITE- 10 USC Sec. 2306b 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2306b. Multiyear contracts: acquisition of property -STATUTE- (a) In General. - To the extent that funds are otherwise available for obligation, the head of an agency may enter into multiyear contracts for the purchase of property whenever the head of that agency finds each of the following: (1) That the use of such a contract will result in substantial savings of the total anticipated costs of carrying out the program through annual contracts. (2) That the minimum need for the property to be purchased is expected to remain substantially unchanged during the contemplated contract period in terms of production rate, procurement rate, and total quantities. (3) That there is a reasonable expectation that throughout the contemplated contract period the head of the agency will request funding for the contract at the level required to avoid contract cancellation. (4) That there is a stable design for the property to be acquired and that the technical risks associated with such property are not excessive. (5) That the estimates of both the cost of the contract and the anticipated cost avoidance through the use of a multiyear contract are realistic. (6) In the case of a purchase by the Department of Defense, that the use of such a contract will promote the national security of the United States. (7) In the case of a contract in an amount equal to or greater than $500,000,000, that the conditions required by subparagraphs (C) through (F) of paragraph (1) of subsection (i) will be met, in accordance with the Secretary's certification and determination under such subsection, by such contract. (b) Regulations. - (1) Each official named in paragraph (2) shall prescribe acquisition regulations for the agency or agencies under the jurisdiction of such official to promote the use of multiyear contracting as authorized by subsection (a) in a manner that will allow the most efficient use of multiyear contracting. (2)(A) The Secretary of Defense shall prescribe the regulations applicable to the Department of Defense. (B) The Secretary of Homeland Security shall prescribe the regulations applicable to the Coast Guard, except that the regulations prescribed by the Secretary of Defense shall apply to the Coast Guard when it is operating as a service in the Navy. (C) The Administrator of the National Aeronautics and Space Administration shall prescribe the regulations applicable to the National Aeronautics and Space Administration. (c) Contract Cancellations. - The regulations may provide for cancellation provisions in multiyear contracts to the extent that such provisions are necessary and in the best interests of the United States. The cancellation provisions may include consideration of both recurring and nonrecurring costs of the contractor associated with the production of the items to be delivered under the contract. (d) Participation by Subcontractors, Vendors, and Suppliers. - In order to broaden the defense industrial base, the regulations shall provide that, to the extent practicable - (1) multiyear contracting under subsection (a) shall be used in such a manner as to seek, retain, and promote the use under such contracts of companies that are subcontractors, vendors, or suppliers; and (2) upon accrual of any payment or other benefit under such a multiyear contract to any subcontractor, vendor, or supplier company participating in such contract, such payment or benefit shall be delivered to such company in the most expeditious manner practicable. (e) Protection of Existing Authority. - The regulations shall provide that, to the extent practicable, the administration of this section, and of the regulations prescribed under this section, shall not be carried out in a manner to preclude or curtail the existing ability of an agency - (1) to provide for competition in the production of items to be delivered under such a contract; or (2) to provide for termination of a prime contract the performance of which is deficient with respect to cost, quality, or schedule. (f) Cancellation or Termination for Insufficient Funding. - In the event funds are not made available for the continuation of a contract made under this section into a subsequent fiscal year, the contract shall be canceled or terminated. The costs of cancellation or termination may be paid from - (1) appropriations originally available for the performance of the contract concerned; (2) appropriations currently available for procurement of the type of property concerned, and not otherwise obligated; or (3) funds appropriated for those payments. (g) Contract Cancellation Ceilings Exceeding $100,000,000. - (1) Before any contract described in subsection (a) that contains a clause setting forth a cancellation ceiling in excess of $100,000,000 may be awarded, the head of the agency concerned shall give written notification of the proposed contract and of the proposed cancellation ceiling for that contract to the congressional defense committees, and such contract may not then be awarded until the end of a period of 30 days beginning on the date of such notification. (2) In the case of a contract described in subsection (a) with a cancellation ceiling described in paragraph (1), if the budget for the contract does not include proposed funding for the costs of contract cancellation up to the cancellation ceiling established in the contract, the head of the agency concerned shall, as part of the certification required by subsection (i)(1)(A), give written notification to the congressional defense committees of - (A) the cancellation ceiling amounts planned for each program year in the proposed multiyear procurement contract, together with the reasons for the amounts planned; (B) the extent to which costs of contract cancellation are not included in the budget for the contract; and (C) a financial risk assessment of not including budgeting for costs of contract cancellation. (h) Defense Acquisitions of Weapon Systems. - In the case of the Department of Defense, the authority under subsection (a) includes authority to enter into the following multiyear contracts in accordance with this section: (1) A multiyear contract for the purchase of a weapon system, items and services associated with a weapon system, and logistics support for a weapon system. (2) A multiyear contract for advance procurement of components, parts, and materials necessary to the manufacture of a weapon system, including a multiyear contract for such advance procurement that is entered into in order to achieve economic-lot purchases and more efficient production rates. (i) Defense Acquisitions Specifically Authorized by Law. - (1) A multiyear contract may not be entered into for any fiscal year under this section for a defense acquisition program that has been specifically authorized by law to be carried out using multiyear contract authority unless the Secretary of Defense certifies in writing by no later than March 1 of the year in which the Secretary requests legislative authority to enter into such contract that each of the following conditions is satisfied: (A) The Secretary has determined that each of the requirements in paragraphs (1) through (6) of subsection (a) will be met by such contract and has provided the basis for such determination to the congressional defense committees. (B) The Secretary's determination under subparagraph (A) was made after the completion of a cost analysis performed by the Director of Cost Assessment and Program Analysis and such analysis supports the findings. (C) The system being acquired pursuant to such contract has not been determined to have experienced cost growth in excess of the critical cost growth threshold pursuant to section 2433(d) of this title within 5 years prior to the date the Secretary anticipates such contract (or a contract for advance procurement entered into consistent with the authorization for such contract) will be awarded. (D) A sufficient number of end items of the system being acquired under such contract have been delivered at or within the most current estimates of the program acquisition unit cost or procurement unit cost for such system to determine that current estimates of such unit costs are realistic. (E) During the fiscal year in which such contract is to be awarded, sufficient funds will be available to perform the contract in such fiscal year, and the future-years defense program for such fiscal year will include the funding required to execute the program without cancellation. (F) The contract is a fixed price type contract. (G) The proposed multiyear contract provides for production at not less than minimum economic rates given the existing tooling and facilities. (2) If for any fiscal year a multiyear contract to be entered into under this section is authorized by law for a particular procurement program and that authorization is subject to certain conditions established by law (including a condition as to cost savings to be achieved under the multiyear contract in comparison to specified other contracts) and if it appears (after negotiations with contractors) that such savings cannot be achieved, but that substantial savings could nevertheless be achieved through the use of a multiyear contract rather than specified other contracts, the President may submit to Congress a request for relief from the specified cost savings that must be achieved through multiyear contracting for that program. Any such request by the President shall include details about the request for a multiyear contract, including details about the negotiated contract terms and conditions. (3) In the case of the Department of Defense, a multiyear contract in an amount equal to or greater than $500,000,000 may not be entered into for any fiscal year under this section unless the contract is specifically authorized by law in an Act other than an appropriations Act. (4)(A) The Secretary of Defense may obligate funds for procurement of an end item under a multiyear contract for the purchase of property only for procurement of a complete and usable end item. (B) The Secretary of Defense may obligate funds appropriated for any fiscal year for advance procurement under a contract for the purchase of property only for the procurement of those long-lead items necessary in order to meet a planned delivery schedule for complete major end items that are programmed under the contract to be acquired with funds appropriated for a subsequent fiscal year (including an economic order quantity of such long-lead items when authorized by law). (5) The Secretary may make the certification under paragraph (1) notwithstanding the fact that one or more of the conditions of such certification are not met if the Secretary determines that, due to exceptional circumstances, proceeding with a multiyear contract under this section is in the best interest of the Department of Defense and the Secretary provides the basis for such determination with the certification. (6) The Secretary of Defense may not delegate the authority to make the certification under paragraph (1) or the determination under paragraph (5) to an official below the level of Under Secretary of Defense for Acquisition, Technology, and Logistics. (7) The Secretary of Defense shall send a notification containing the findings of the agency head under subsection (a), and the basis for such findings, 30 days prior to the award of a multiyear contract for a defense acquisition program that has been specifically authorized by law. (j) Defense Contract Options for Varying Quantities. - The Secretary of Defense may instruct the Secretary of the military department concerned to incorporate into a proposed multiyear contract negotiated priced options for varying the quantities of end items to be procured over the period of the contract. (k) Multiyear Contract Defined. - For the purposes of this section, a multiyear contract is a contract for the purchase of property for more than one, but not more than five, program years. Such a contract may provide that performance under the contract during the second and subsequent years of the contract is contingent upon the appropriation of funds and (if it does so provide) may provide for a cancellation payment to be made to the contractor if such appropriations are not made. (l) Various Additional Requirements With Respect to Multiyear Defense Contracts. - (1)(A) The head of an agency may not initiate a contract described in subparagraph (B) unless the congressional defense committees are notified of the proposed contract at least 30 days in advance of the award of the proposed contract. (B) Subparagraph (A) applies to the following contracts: (i) A multiyear contract - (I) that employs economic order quantity procurement in excess of $20,000,000 in any one year of the contract; or (II) that includes an unfunded contingent liability in excess of $20,000,000. (ii) Any contract for advance procurement leading to a multiyear contract that employs economic order quantity procurement in excess of $20,000,000 in any one year. (2) The head of an agency may not initiate a multiyear contract for which the economic order quantity advance procurement is not funded at least to the limits of the Government's liability. (3) The head of an agency may not initiate a multiyear procurement contract for any system (or component thereof) if the value of the multiyear contract would exceed $500,000,000 unless authority for the contract is specifically provided in an appropriations Act. (4) Not later than the date of the submission of the President's budget request under section 1105 of title 31, the Secretary of Defense shall submit a report to the congressional defense committees each year, providing the following information with respect to each multiyear contract (and each extension of an existing multiyear contract) entered into, or planned to be entered into, by the head of an agency during the current or preceding year, shown for each year in the current future-years defense program and in the aggregate over the period of the current future- years defense program: (A) The amount of total obligational authority under the contract (or contract extension) and the percentage that such amount represents of - (i) the applicable procurement account; and (ii) the agency procurement total. (B) The amount of total obligational authority under all multiyear procurements of the agency concerned (determined without regard to the amount of the multiyear contract (or contract extension)) under multiyear contracts in effect at the time the report is submitted and the percentage that such amount represents of - (i) the applicable procurement account; and (ii) the agency procurement total. (C) The amount equal to the sum of the amounts under subparagraphs (A) and (B), and the percentage that such amount represents of - (i) the applicable procurement account; and (ii) the agency procurement total. (D) The amount of total obligational authority under all Department of Defense multiyear procurements (determined without regard to the amount of the multiyear contract (or contract extension)), including any multiyear contract (or contract extension) that has been authorized by the Congress but not yet entered into, and the percentage that such amount represents of the procurement accounts of the Department of Defense treated in the aggregate. (5) The head of an agency may not enter into a multiyear contract (or extend an existing multiyear contract), the value of which would exceed $500,000,000 (when entered into or when extended, as the case may be), until the Secretary of Defense submits to the congressional defense committees a report containing the information described in paragraph (4) with respect to the contract (or contract extension). (6) The head of an agency may not terminate a multiyear procurement contract until 10 days after the date on which notice of the proposed termination is provided to the congressional defense committees. (7) The execution of multiyear contracting authority shall require the use of a present value analysis to determine lowest cost compared to an annual procurement. (8) This subsection does not apply to the National Aeronautics and Space Administration or to the Coast Guard. (9) In this subsection: (A) The term "applicable procurement account" means, with respect to a multiyear procurement contract (or contract extension), the appropriation account from which payments to execute the contract will be made. (B) The term "agency procurement total" means the procurement accounts of the agency entering into a multiyear procurement contract (or contract extension) treated in the aggregate. (m) Increased Funding and Reprogramming Requests. - Any request for increased funding for the procurement of a major system under a multiyear contract authorized under this section shall be accompanied by an explanation of how the request for increased funding affects the determinations made by the Secretary under subsection (i). -SOURCE- (Added Pub. L. 103-355, title I, Sec. 1022(a)(1), Oct. 13, 1994, 108 Stat. 3257; amended Pub. L. 104-106, div. A, title XV, Sec. 1502(a)(10), div. E, title LVI, Sec. 5601(b), Feb. 10, 1996, 110 Stat. 503, 699; Pub. L. 105-85, div. A, title VIII, Sec. 806(a)(1), (b)(1), (c), title X, Sec. 1073(a)(47), (48)(A), Nov. 18, 1997, 111 Stat. 1834, 1835, 1903; Pub. L. 106-65, div. A, title VIII, Sec. 809, title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 705, 774; Pub. L. 106-398, Sec. 1 [[div. A], title VIII, Secs. 802(c), 806], Oct. 30, 2000, 114 Stat. 1654, 1654A-205, 1654A-207; Pub. L. 107-296, title XVII, Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314; Pub. L. 107-314, div. A, title VIII, Sec. 820(a), Dec. 2, 2002, 116 Stat. 2613; Pub. L. 108-136, div. A, title X, Sec. 1043(b)(10), Nov. 24, 2003, 117 Stat. 1611; Pub. L. 108-375, div. A, title VIII, Sec. 814(a), title X, Sec. 1084(b)(2), Oct. 28, 2004, 118 Stat. 2014, 2060; Pub. L. 110-181, div. A, title VIII, Sec. 811(a), Jan. 28, 2008, 122 Stat. 217; Pub. L. 111-23, title I, Sec. 101(d)(2), May 22, 2009, 123 Stat. 1709.) -MISC1- AMENDMENTS 2009 - Subsec. (i)(1)(B). Pub. L. 111-23 substituted "Director of Cost Assessment and Program Analysis" for "Cost Analysis Improvement Group of the Department of Defense". 2008 - Subsec. (a)(7). Pub. L. 110-181, Sec. 811(a)(1), added par. (7). Subsec. (i)(1). Pub. L. 110-181, Sec. 811(a)(2), (3), inserted "the Secretary of Defense certifies in writing by no later than March 1 of the year in which the Secretary requests legislative authority to enter into such contract that" after "unless" in introductory provisions, added subpars. (A) to (F), redesignated former subpar. (B) as (G), and struck out former subpar. (A) which read as follows: "The Secretary of Defense certifies to Congress that the current future-years defense program fully funds the support costs associated with the multiyear program." Subsec. (i)(5) to (7). Pub. L. 110-181, Sec. 811(a)(4), added pars. (5) to (7). Subsec. (m). Pub. L. 110-181, Sec. 811(a)(5), added subsec. (m). 2004 - Subsec. (g). Pub. L. 108-375, Sec. 814(a)(1), designated existing provisions as par. (1). Subsec. (g)(1). Pub. L. 108-375, Secs. 814(a)(2), 1084(b)(2), amended par. (1) identically, substituting "congressional defense committees" for "Committee on Armed Services and the Committee on Appropriations of the Senate and the Committee on Armed Services and the Committee on Appropriations of the House of Representatives". Subsec. (g)(2). Pub. L. 108-375, Sec. 814(a)(3), added par. (2). 2003 - Subsec. (l)(9), (10). Pub. L. 108-136 redesignated par. (10) as (9) and struck out former par. (9) which read as follows: "In this subsection, the term 'congressional defense committees' means the following: "(A) The Committee on Armed Services of the Senate and the Subcommittee on Defense of the Committee on Appropriations of the Senate. "(B) The Committee on Armed Services of the House of Representatives and the Subcommittee on National Security of the Committee on Appropriations of the House of Representatives." 2002 - Subsec. (b)(2)(B). Pub. L. 107-296 substituted "of Homeland Security" for "of Transportation". Subsec. (i)(4). Pub. L. 107-314 added par. (4). 2000 - Subsec. (k). Pub. L. 106-398, Sec. 1 [[div. A], title VIII, Sec. 802(c)], struck out "or services" after "purchase of property". Subsec. (l)(4). Pub. L. 106-398, Sec. 1 [[div. A], title VIII, Sec. 806(1)(A)], in introductory provisions, substituted "Not later than the date of the submission of the President's budget request under section 1105 of title 31, the Secretary of Defense shall submit a report to the congressional defense committees each year, providing the following information with respect to each multiyear contract (and each extension of an existing multiyear contract) entered into, or planned to be entered into, by the head of an agency during the current or preceding year" for "The head of an agency may not enter into a multiyear contract (or extend an existing multiyear contract) until the Secretary of Defense submits to the congressional defense committees a report with respect to that contract (or contract extension) that provides the following information". Subsec. (l)(4)(B). Pub. L. 106-398, Sec. 1 [[div. A], title VIII, Sec. 806(1)(B)], substituted "in effect at the time the report is submitted" for "in effect immediately before the contract (or contract extension) is entered into" in introductory provisions. Subsec. (l)(5) to (10). Pub. L. 106-398, Sec. 1 [[div. A], title VIII, Sec. 806(2), (3)], added par. (5) and redesignated former pars. (5) to (9) as (6) to (10), respectively. 1999 - Subsec. (g). Pub. L. 106-65, Sec. 1067(1), substituted "and the Committee on Armed Services" for "and the Committee on National Security". Subsec. (l)(4) to (7). Pub. L. 106-65, Sec. 809(1), (2), added par. (4) and redesignated former pars. (4) to (6) as (5) to (7), respectively. Former par. (7) redesignated (8). Subsec. (l)(8). Pub. L. 106-65, Sec. 809(1), redesignated par. (7) as (8). Subsec. (l)(8)(B). Pub. L. 106-65, Sec. 1067(1), substituted "Committee on Armed Services" for "Committee on National Security". Subsec. (l)(9). Pub. L. 106-65, Sec. 809(3), added par. (9). 1997 - Pub. L. 105-85, Sec. 1073(a)(48)(A), inserted ": acquisition of property" in section catchline. Subsec. (a). Pub. L. 105-85, Sec. 806(c)(1), substituted "finds each of the following:" for "finds - " in introductory provisions, capitalized first letter of first word in pars. (1) to (6), and substituted a period for semicolon at end of pars. (1) to (4) and for "; and" at end of par. (5). Subsec. (d)(1). Pub. L. 105-85, Sec. 806(c)(2), substituted "subsection (a)" for "paragraph (1)". Subsec. (i)(1)(A). Pub. L. 105-85, Sec. 806(c)(3), substituted "future-years" for "five-year". Subsec. (i)(3). Pub. L. 105-85, Sec. 806(a)(1), added par. (3). Subsec. (k). Pub. L. 105-85, Sec. 1073(a)(47), substituted "this section" for "this subsection". Subsec. (l). Pub. L. 105-85, Sec. 806(b)(1), added subsec. (l). 1996 - Subsec. (g). Pub. L. 104-106, Sec. 1502(a)(10), substituted "the Committee on Armed Services and the Committee on Appropriations of the Senate and the Committee on National Security and the Committee on Appropriations of the" for "the Committees on Armed Services and on Appropriations of the Senate and". Subsecs. (k), (l). Pub. L. 104-106, Sec. 5601(b), redesignated subsec. (l) as (k) and struck out former subsec. (k) which read as follows: "Inapplicability to Automatic Data Processing Contracts. - This section does not apply to contracts for the purchase of property to which section 111 of the Federal Property and Administrative Services Act of 1949 (40 U.S.C. 759) applies." EFFECTIVE DATE OF 2008 AMENDMENT Pub. L. 110-181, div. A, title VIII, Sec. 811(b), Jan. 28, 2008, 122 Stat. 219, provided that: "The amendments made by this section [amending this section] shall take effect on the date of the enactment of this Act [Jan. 28, 2008] and shall apply with respect to multiyear contracts for the purchase of major systems for which legislative authority is requested on or after that date." EFFECTIVE DATE OF 2002 AMENDMENTS Pub. L. 107-314, div. A, title VIII, Sec. 820(b), Dec. 2, 2002, 116 Stat. 2614, provided that: "(1) Paragraph (4) of section 2306b(i) of title 10, United States Code, as added by subsection (a), shall not apply with respect to any contract awarded before the date of the enactment of this Act [Dec. 2, 2002]. "(2) Nothing in this section [amending this section] shall be construed to authorize the expenditure of funds under any contract awarded before the date of the enactment of this Act for any purpose other than the purpose for which such funds have been authorized and appropriated." Amendment by Pub. L. 107-296 effective on the date of transfer of the Coast Guard to the Department of Homeland Security, see section 1704(g) of Pub. L. 107-296, set out as a note under section 101 of this title. EFFECTIVE DATE OF 1997 AMENDMENT Section 806(a)(2) of Pub. L. 105-85 provided that: "Paragraph (3) of section 2306b(i) of title 10, United States Code, as added by paragraph (1), shall not apply with respect to a contract authorized by law before the date of the enactment of this Act [Nov. 18, 1997]." Section 806(b)(2) of Pub. L. 105-85 provided that: "The amendment made by paragraph (1) [amending this section] shall take effect on October 1, 1998." EFFECTIVE DATE OF 1996 AMENDMENT Amendment by section 5601(b) of Pub. L. 104-106 effective 180 days after Feb. 10, 1996, see section 5701 of Pub. L. 104-106, Feb. 10, 1996, 110 Stat. 702. EFFECTIVE DATE For effective date and applicability of section, see section 10001 of Pub. L. 103-355, set out as an Effective Date of 1994 Amendment note under section 2302 of this title. MULTIYEAR PROCUREMENT CONTRACTS Pub. L. 105-56, title VIII, Sec. 8008, Oct. 8, 1997, 111 Stat. 1221, provided that: "(a) None of the funds provided in this Act [see Tables for classification] shall be available to initiate: (1) a multiyear contract that employs economic order quantity procurement in excess of $20,000,000 in any one year of the contract or that includes an unfunded contingent liability in excess of $20,000,000; or (2) a contract for advance procurement leading to a multiyear contract that employs economic order quantity procurement in excess of $20,000,000 in any one year, unless the congressional defense committees [Committee on Armed Services and Subcommittee on National Security of the Committee on Appropriations of the House of Representatives and Committee on Armed Services and Subcommittee on Defense of the Committee on Appropriations of the Senate] have been notified at least 30 days in advance of the proposed contract award: Provided, That no part of any appropriation contained in this Act shall be available to initiate a multiyear contract for which the economic order quantity advance procurement is not funded at least to the limits of the Government's liability: Provided further, That no part of any appropriation contained in this Act shall be available to initiate multiyear procurement contracts for any systems or component thereof if the value of the multiyear contract would exceed $500,000,000 unless specifically provided in this Act: Provided further, That no multiyear procurement contract can be terminated without 10-day prior notification to the congressional defense committees: Provided further, That the execution of multiyear authority shall require the use of a present value analysis to determine lowest cost compared to an annual procurement. "Funds appropriated in title III of this Act [111 Stat. 1211] may be used for multiyear procurement contracts as follows: "Apache Longbow radar; "AV-8B aircraft; and "Family of Medium Tactical Vehicles. "(b) None of the funds provided in this Act and hereafter may be used to submit to Congress (or to any committee of Congress) a request for authority to enter into a contract covered by those provisions of subsection (a) that precede the first proviso of that subsection unless - "(1) such request is made as part of the submission of the President's Budget for the United States Government for any fiscal year and is set forth in the Appendix to that budget as part of proposed legislative language for appropriations bills for the next fiscal year; or "(2) such request is formally submitted by the President as a budget amendment; or "(3) the Secretary of Defense makes such request in writing to the congressional defense committees." Similar provisions were contained in the following appropriation acts: Pub. L. 112-74, div. A, title VIII, Sec. 8010, Dec. 23, 2011, 125 Stat. 806. Pub. L. 112-10, div. A, title VIII, Sec. 8010, Apr. 15, 2011, 125 Stat. 57. Pub. L. 111-118, div. A, title VIII, Sec. 8011, Dec. 19, 2009, 123 Stat. 3428, as amended by Pub. L. 111-212, title I, Sec. 305, July 29, 2010, 124 Stat. 2311. Pub. L. 110-329, div. C, title VIII, Sec. 8011, Sept. 30, 2008, 122 Stat. 3621. Pub. L. 110-116, div. A, title VIII, Sec. 8010, Nov. 13, 2007, 121 Stat. 1315. Pub. L. 109-289, div. A, title VIII, Sec. 8008, Sept. 29, 2006, 120 Stat. 1273. Pub. L. 109-148, div. A, title VIII, Sec. 8008, Dec. 30, 2005, 119 Stat. 2698. Pub. L. 108-287, title VIII, Sec. 8008, Aug. 5, 2004, 118 Stat. 970. Pub. L. 108-87, title VIII, Sec. 8008, Sept. 30, 2003, 117 Stat. 1072. Pub. L. 107-248, title VIII, Sec. 8008, Oct. 23, 2002, 116 Stat. 1537. Pub. L. 107-117, div. A, title VIII, Sec. 8008, Jan. 10, 2002, 115 Stat. 2248. Pub. L. 106-259, title VIII, Sec. 8008, Aug. 9, 2000, 114 Stat. 675. Pub. L. 106-79, title VIII, Sec. 8008, Oct. 25, 1999, 113 Stat. 1232. Pub. L. 105-262, title VIII, Sec. 8008, Oct. 17, 1998, 112 Stat. 2298. Pub. L. 104-208, div. A, title I, Sec. 101(b) [title VIII, Sec. 8009], Sept. 30, 1996, 110 Stat. 3009-71, 3009-89. Pub. L. 104-61, title VIII, Sec. 8010, Dec. 1, 1995, 109 Stat. 653. Pub. L. 103-335, title VIII, Sec. 8010, Sept. 30, 1994, 108 Stat. 2618. Pub. L. 103-139, title VIII, Sec. 8011, Nov. 11, 1993, 107 Stat. 1439. Pub. L. 102-396, title IX, Sec. 9013, Oct. 6, 1992, 106 Stat. 1903. Pub. L. 102-172, title VIII, Sec. 8013, Nov. 26, 1991, 105 Stat. 1173. Pub. L. 101-511, title VIII, Sec. 8014, Nov. 5, 1990, 104 Stat. 1877. Pub. L. 101-165, title IX, Sec. 9021, Nov. 21, 1989, 103 Stat. 1133. -End- -CITE- 10 USC Sec. 2306c 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2306c. Multiyear contracts: acquisition of services -STATUTE- (a) Authority. - Subject to subsections (d) and (e), the head of an agency may enter into contracts for periods of not more than five years for services described in subsection (b), and for items of supply related to such services, for which funds would otherwise be available for obligation only within the fiscal year for which appropriated whenever the head of the agency finds that - (1) there will be a continuing requirement for the services consonant with current plans for the proposed contract period; (2) the furnishing of such services will require a substantial initial investment in plant or equipment, or the incurrence of substantial contingent liabilities for the assembly, training, or transportation of a specialized work force; and (3) the use of such a contract will promote the best interests of the United States by encouraging effective competition and promoting economies in operation. (b) Covered Services. - The authority under subsection (a) applies to the following types of services: (1) Operation, maintenance, and support of facilities and installations. (2) Maintenance or modification of aircraft, ships, vehicles, and other highly complex military equipment. (3) Specialized training necessitating high quality instructor skills (for example, pilot and air crew members; foreign language training). (4) Base services (for example, ground maintenance; in-plane refueling; bus transportation; refuse collection and disposal). (5) Environmental remediation services for - (A) an active military installation; (B) a military installation being closed or realigned under a base closure law; or (C) a site formerly used by the Department of Defense. (c) Applicable Principles. - In entering into multiyear contracts for services under the authority of this section, the head of the agency shall be guided by the following principles: (1) The portion of the cost of any plant or equipment amortized as a cost of contract performance should not exceed the ratio between the period of contract performance and the anticipated useful commercial life of such plant or equipment. Useful commercial life, for this purpose, means the commercial utility of the facilities rather than the physical life thereof, with due consideration given to such factors as location of facilities, specialized nature thereof, and obsolescence. (2) Consideration shall be given to the desirability of obtaining an option to renew the contract for a reasonable period not to exceed three years, at prices not to include charges for plant, equipment and other nonrecurring costs, already amortized. (3) Consideration shall be given to the desirability of reserving in the agency the right, upon payment of the unamortized portion of the cost of the plant or equipment, to take title thereto under appropriate circumstances. (d) Restrictions Applicable Generally. - (1) The head of an agency may not initiate under this section a contract for services that includes an unfunded contingent liability in excess of $20,000,000 unless the congressional defense committees are notified of the proposed contract at least 30 days in advance of the award of the proposed contract. (2) The head of an agency may not initiate a multiyear contract for services under this section if the value of the multiyear contract would exceed $500,000,000 unless authority for the contract is specifically provided by law. (3) The head of an agency may not terminate a multiyear procurement contract for services until 10 days after the date on which notice of the proposed termination is provided to the congressional defense committees. (4) Before any contract described in subsection (a) that contains a clause setting forth a cancellation ceiling in excess of $100,000,000 may be awarded, the head of the agency concerned shall give written notification of the proposed contract and of the proposed cancellation ceiling for that contract to the congressional defense committees, and such contract may not then be awarded until the end of a period of 30 days beginning on the date of such notification. (5) In the case of a contract described in subsection (a) with a cancellation ceiling described in paragraph (4), if the budget for the contract does not include proposed funding for the costs of contract cancellation up to the cancellation ceiling established in the contract, the head of the agency concerned shall give written notification to the congressional defense committees of - (A) the cancellation ceiling amounts planned for each program year in the proposed multiyear procurement contract, together with the reasons for the amounts planned; (B) the extent to which costs of contract cancellation are not included in the budget for the contract; and (C) a financial risk assessment of not including budgeting for costs of contract cancellation. (e) Cancellation or Termination for Insufficient Funding After First Year. - In the event that funds are not made available for the continuation of a multiyear contract for services into a subsequent fiscal year, the contract shall be canceled or terminated, and the costs of cancellation or termination may be paid from - (1) appropriations originally available for the performance of the contract concerned; (2) appropriations currently available for procurement of the type of services concerned, and not otherwise obligated; or (3) funds appropriated for those payments. (f) Multiyear Contract Defined. - For the purposes of this section, a multiyear contract is a contract for the purchase of services for more than one, but not more than five, program years. Such a contract may provide that performance under the contract during the second and subsequent years of the contract is contingent upon the appropriation of funds and (if it does so provide) may provide for a cancellation payment to be made to the contractor if such appropriations are not made. [(g) Repealed. Pub. L. 108-136, div. A, title VIII, Sec. 843(a), Nov. 24, 2003, 117 Stat. 1553.] (h) Military Installation Defined. - In this section, the term "military installation" has the meaning given such term in section 2801(c)(4) of this title. -SOURCE- (Added Pub. L. 106-398, Sec. 1 [[div. A], title VIII, Sec. 802(a)(1)], Oct. 30, 2000, 114 Stat. 1654, 1654A-203; amended Pub. L. 107-314, div. A, title VIII, Secs. 811(a), 827, Dec. 2, 2002, 116 Stat. 2608, 2617; Pub. L. 108-136, div. A, title VIII, Sec. 843(a), title X, Sec. 1043(c)(1), Nov. 24, 2003, 117 Stat. 1553, 1611; Pub. L. 108-375, div. A, title VIII, Sec. 814(b), Oct. 28, 2004, 118 Stat. 2014; Pub. L. 111-84, div. A, title X, Sec. 1073(a)(22), Oct. 28, 2009, 123 Stat. 2473.) -MISC1- AMENDMENTS 2009 - Subsec. (h). Pub. L. 111-84 substituted "section 2801(c)(4)" for "section 2801(c)(2)". 2004 - Subsec. (d)(1), (3), (4). Pub. L. 108-375, Sec. 814(b)(1), substituted "congressional defense committees" for "committees of Congress named in paragraph (5)". Subsec. (d)(5). Pub. L. 108-375, Sec. 814(b)(2), amended par. (5) generally. Prior to amendment, par. (5) read as follows: "The committees of Congress referred to in paragraphs (1), (3), and (4) are as follows: "(A) The Committee on Armed Services and the Committee on Appropriations of the Senate. "(B) The Committee on Armed Services and the Committee on Appropriations of the House of Representatives." 2003 - Subsec. (g). Pub. L. 108-136, Sec. 843(a), struck out heading and text of subsec. (g). Text read as follows: "(1) The authority and restrictions of this section, including the authority to enter into contracts for periods of not more than five years, shall apply with respect to task order and delivery order contracts entered into under the authority of section 2304a, 2304b, or 2304c of this title. "(2) The regulations implementing this subsection shall establish a preference that, to the maximum extent practicable, multi-year requirements for task order and delivery order contracts be met with separate awards to two or more sources under the authority of section 2304a(d)(1)(B) of this title." Subsec. (h). Pub. L. 108-136, Sec. 1043(c)(1), substituted "Military Installation Defined. - In this section, the term" for "Additional Definitions. - In this section: "(1) The term 'base closure law' has the meaning given such term in section 2667(h)(2) of this title. "(2) The term". 2002 - Subsec. (b)(5). Pub. L. 107-314, Sec. 827(a), added par. (5). Subsec. (g). Pub. L. 107-314, Sec. 811(a), added subsec. (g). Subsec. (h). Pub. L. 107-314, Sec. 827(b), added subsec. (h). EFFECTIVE DATE OF 2002 AMENDMENT Pub. L. 107-314, div. A, title VIII, Sec. 811(b), Dec. 2, 2002, 116 Stat. 2608, as amended by Pub. L. 108-11, title I, Sec. 1315, Apr. 16, 2003, 117 Stat. 570, provided that: "Subsection (g) of section 2306c of title 10, United States Code, as added by subsection (a), shall apply to all task order and delivery order contracts entered into on or after January 1, 2004." EFFECTIVE DATE Pub. L. 106-398, Sec. 1 [[div. A], title VIII, Sec. 802(d)], Oct. 30, 2000, 114 Stat. 1654, 1654A-205, provided that: "Section 2306c of title 10, United States Code (as added by subsection (a)), shall apply with respect to contracts for which solicitations of offers are issued after the date of the enactment of this Act [Oct. 30, 2000]." -End- -CITE- 10 USC Sec. 2307 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2307. Contract financing -STATUTE- (a) Payment Authority. - The head of any agency may - (1) make advance, partial, progress, or other payments under contracts for property or services made by the agency; and (2) insert in solicitations for procurement of property or services a provision limiting to small business concerns advance or progress payments. (b) Performance-Based Payments. - Whenever practicable, payments under subsection (a) shall be made on any of the following bases: (1) Performance measured by objective, quantifiable methods such as delivery of acceptable items, work measurement, or statistical process controls. (2) Accomplishment of events defined in the program management plan. (3) Other quantifiable measures of results. (c) Payment Amount. - Payments made under subsection (a) may not exceed the unpaid contract price. (d) Security for Advance Payments. - Advance payments made under subsection (a) may be made only if the contractor gives adequate security and after a determination by the head of the agency that to do so would be in the public interest. Such security may be in the form of a lien in favor of the United States on the property contracted for, on the balance in an account in which such payments are deposited, and on such of the property acquired for performance of the contract as the parties may agree. This lien is paramount to any other liens and is effective immediately upon the first advancement of funds without filing, notice, or any other action by the United States. (e) Conditions for Progress Payments. - (1) The Secretary of Defense shall ensure that any payment for work in progress (including materials, labor, and other items) under a defense contract that provides for such payments is commensurate with the work accomplished that meets standards established under the contract. The contractor shall provide such information and evidence as the Secretary of Defense determines necessary to permit the Secretary to carry out the preceding sentence. (2) The Secretary shall ensure that progress payments referred to in paragraph (1) are not made for more than 80 percent of the work accomplished under a defense contract so long as the Secretary has not made the contractual terms, specifications, and price definite. (3) This subsection applies to any contract in an amount greater than $25,000. (f) Conditions for Payments for Commercial Items. - (1) Payments under subsection (a) for commercial items may be made under such terms and conditions as the head of the agency determines are appropriate or customary in the commercial marketplace and are in the best interests of the United States. The head of the agency shall obtain adequate security for such payments. If the security is in the form of a lien in favor of the United States, such lien is paramount to all other liens and is effective immediately upon the first payment, without filing, notice, or other action by the United States. (2) Advance payments made under subsection (a) for commercial items may include payments, in a total amount of not more than 15 percent of the contract price, in advance of any performance of work under the contract. (3) The conditions of subsections (d) and (e) need not be applied if they would be inconsistent, as determined by the head of the agency, with commercial terms and conditions pursuant to paragraphs (1) and (2). (g) Certain Navy Contracts. - (1) The Secretary of the Navy shall provide that the rate for progress payments on any contract awarded by the Secretary for repair, maintenance, or overhaul of a naval vessel shall be not less than - (A) 95 percent, in the case of a firm considered to be a small business; and (B) 90 percent, in the case of any other firm. (2) The Secretary of the Navy may advance to private salvage companies such funds as the Secretary considers necessary to provide for the immediate financing of salvage operations. Advances under this paragraph shall be made on terms that the Secretary considers adequate for the protection of the United States. (3) The Secretary of the Navy shall provide, in each contract for construction or conversion of a naval vessel, that, when partial, progress, or other payments are made under such contract, the United States is secured by a lien upon work in progress and on property acquired for performance of the contract on account of all payments so made. The lien is paramount to all other liens. (h) Vesting of Title in the United States. - If a contract paid by a method authorized under subsection (a)(1) provides for title to property to vest in the United States, the title to the property shall vest in accordance with the terms of the contract, regardless of any security interest in the property that is asserted before or after the contract is entered into. (i) Action in Case of Fraud. - (1) In any case in which the remedy coordination official of an agency finds that there is substantial evidence that the request of a contractor for advance, partial, or progress payment under a contract awarded by that agency is based on fraud, the remedy coordination official shall recommend that the head of the agency reduce or suspend further payments to such contractor. (2) The head of an agency receiving a recommendation under paragraph (1) in the case of a contractor's request for payment under a contract shall determine whether there is substantial evidence that the request is based on fraud. Upon making such a determination, the agency head may reduce or suspend further payments to the contractor under such contract. (3) The extent of any reduction or suspension of payments by the head of an agency under paragraph (2) on the basis of fraud shall be reasonably commensurate with the anticipated loss to the United States resulting from the fraud. (4) A written justification for each decision of the head of an agency whether to reduce or suspend payments under paragraph (2) and for each recommendation received by such agency head in connection with such decision shall be prepared and be retained in the files of such agency. (5) The head of an agency shall prescribe procedures to ensure that, before such agency head decides to reduce or suspend payments in the case of a contractor under paragraph (2), the contractor is afforded notice of the proposed reduction or suspension and an opportunity to submit matters to the head of the agency in response to such proposed reduction or suspension. (6) Not later than 180 days after the date on which the head of an agency reduces or suspends payments to a contractor under paragraph (2), the remedy coordination official of such agency shall - (A) review the determination of fraud on which the reduction or suspension is based; and (B) transmit a recommendation to the head of such agency whether the suspension or reduction should continue. (7) The head of an agency shall prepare for each year a report containing the recommendations made by the remedy coordination official of that agency to reduce or suspend payments under paragraph (2), the actions taken on the recommendations and the reasons for such actions, and an assessment of the effects of such actions on the Federal Government. The Secretary of each military department shall transmit the annual report of such department to the Secretary of Defense. Each such report shall be available to any member of Congress upon request. (8) This subsection applies to the agencies named in paragraphs (1), (2), (3), (4), and (6) of section 2303(a) of this title. (9) The head of an agency may not delegate responsibilities under this subsection to any person in a position below level IV of the Executive Schedule. (10) In this subsection, the term "remedy coordination official", with respect to an agency, means the person or entity in that agency who coordinates within that agency the administration of criminal, civil, administrative, and contractual remedies resulting from investigations of fraud or corruption related to procurement activities. -SOURCE- (Aug. 10, 1956, ch. 1041, 70A Stat. 131; Pub. L. 85-800, Sec. 9, Aug. 28, 1958, 72 Stat. 967; Pub. L. 93-155, title VIII, Sec. 807(c), Nov. 16, 1973, 87 Stat. 616; Pub. L. 100-370, Sec. 1(f)(1)(A), July 19, 1988, 102 Stat. 846; Pub. L. 101-510, div. A, title VIII, Sec. 836(a), (b), title XIII, Sec. 1322(a)(4), Nov. 5, 1990, 104 Stat. 1615, 1616, 1671; Pub. L. 102-25, title VII, Sec. 701(d)(4), (j)(2)(A), Apr. 6, 1991, 105 Stat. 114, 116; Pub. L. 102- 190, div. A, title X, Sec. 1061(a)(10), Dec. 5, 1991, 105 Stat. 1472; Pub. L. 102-484, div. A, title X, Sec. 1052(24), Oct. 23, 1992, 106 Stat. 2500; Pub. L. 103-355, title II, Sec. 2001(a)-(g), Oct. 13, 1994, 108 Stat. 3301, 3302; Pub. L. 105-85, div. A, title VIII, Sec. 802, Nov. 18, 1997, 111 Stat. 1831; Pub. L. 106-391, title III, Sec. 306, Oct. 30, 2000, 114 Stat. 1592.) -MISC1- HISTORICAL AND REVISION NOTES 1956 ACT -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2307(a) 41:154(a). Feb. 19, 1948, ch. 65, Sec. 5, 62 Stat. 23. 2307(b) 41:154 (less (a)). -------------------------------------------------------------------- In subsection (a), the words "and appropriate" are omitted as surplusage. The words "whether or not the contract previously provided for such payments" are substituted for the words "heretofore or hereafter executed". In subsection (b), the words "under subsection (a)" are inserted for clarity. The words "provide for" are substituted for the words "include as security provision for". The words "United States" are substituted for the word "Government". 1988 ACT Subsection (e) is based on Pub. L. 99-145, title IX, Sec. 916, Nov. 8, 1985, 99 Stat. 688. -REFTEXT- REFERENCES IN TEXT Level IV of the Executive Schedule, referred to in subsec. (i)(9), is set out in section 5315 of Title 5, Government Organization and Employees. -MISC2- PRIOR PROVISIONS Provisions similar to those in subsec. (g) of this section were contained in sections 7312, 7364, and 7521 of this title prior to repeal by Pub. L. 103-355, Sec. 2001(j)(1). AMENDMENTS 2000 - Subsec. (i)(8). Pub. L. 106-391 substituted "(4), and (6)" for "and (4)". 1997 - Subsecs. (h), (i). Pub. L. 105-85 added subsec. (h) and redesignated former subsec. (h) as (i). 1994 - Pub. L. 103-355, Sec. 2001(a)(1), substituted "Contract financing" for "Advance payments" in section catchline. Subsec. (a). Pub. L. 103-355, Sec. 2001(a)(2), inserted heading. Subsec. (a)(2). Pub. L. 103-355, Sec. 2001(c), struck out "bid" before "solicitations". Subsec. (b). Pub. L. 103-355, Sec. 2001(a)(7), (b), added subsec. (b) and redesignated former subsec. (b) as (c). Pub. L. 103-355, Sec. 2001(a)(3), inserted heading. Subsec. (c). Pub. L. 103-355, Sec. 2001(a)(7), redesignated subsec. (b) as (c). Former subsec. (c) redesignated (d). Pub. L. 103-355, Sec. 2001(a)(4), inserted heading. Subsec. (d). Pub. L. 103-355, Sec. 2001(d), inserted before period at end "and is effective immediately upon the first advancement of funds without filing, notice, or any other action by the United States". Pub. L. 103-355, Sec. 2001(a)(7), redesignated former subsec. (c) as (d). Former subsec. (d) redesignated (e). Pub. L. 103-355, Sec. 2001(a)(5), inserted heading. Subsec. (e). Pub. L. 103-355, Sec. 2001(a)(7), redesignated subsec. (d) as (e). Former subsec. (e) redesignated (h). Pub. L. 103-355, Sec. 2001(a)(6), inserted heading. Subsec. (e)(1). Pub. L. 103-355, Sec. 2001(e)(1), substituted "work accomplished that meets standards established under the contract" for "work, which meets standards of quality established under the contract, that has been accomplished". Subsec. (e)(3). Pub. L. 103-355, Sec. 2001(e)(2), amended par. (3) generally. Prior to amendment, par. (3) read as follows: "This subsection does not apply to any contract for an amount not in excess of the amount of the small purchase threshold." Subsecs. (f), (g). Pub. L. 103-355, Sec. 2001(f), (g), added subsecs. (f) and (g). Subsec. (h). Pub. L. 103-355, Sec. 2001(a)(7), redesignated subsec. (e) as (h). 1992 - Subsec. (e)(1). Pub. L. 102-484 substituted "(1)" for "(l)" as par. designation after "(e)". 1991 - Subsec. (d)(3). Pub. L. 102-25, Sec. 701(d)(4), substituted "any contract for an amount not in excess of the amount of the small purchase threshold" for "contracts for amounts less than the maximum amount for small purchases specified in section 2304(g)(2) of this title". Subsec. (e). Pub. L. 102-25, Sec. 701(j)(2)(A), redesignated subsec. (f) as (e). Subsec. (f). Pub. L. 102-190, which directed the substitution of "(1)" for "(l)" as par. designation after "(f)", could not be executed because "(l)" did not appear after "(f)". Pub. L. 102-25, Sec. 701(j)(2)(A), redesignated subsec. (f) as (e). 1990 - Subsec. (d). Pub. L. 101-510, Sec. 1322(a)(4), redesignated subsec. (e) as (d) and struck out former subsec. (d) which read as follows: "Payments under subsection (a) in the case of any contract, other than partial, progress, or other payments specifically provided for in such contract at the time such contract was initially entered into, may not exceed $25,000,000 unless the Committees on Armed Services of the Senate and the House of Representatives have been notified in writing of such proposed payments and 60 days of continuous session of Congress have expired following the date on which such notice was transmitted to such Committees and neither House of Congress has adopted, within such 60-day period, a resolution disapproving such payments. For purposes of this section, the continuity of a session of Congress is broken only by an adjournment of the Congress sine die, and the days on which either House is not in session because of an adjournment of more than 3 days to a day certain are excluded in the computation of such 60-day period." Subsec. (e). Pub. L. 101-510, Sec. 1322(a)(4)(B), redesignated subsec. (e) as (d). Pub. L. 101-510, Sec. 836(b), inserted at end of par. (1) "The contractor shall provide such information and evidence as the Secretary of Defense determines necessary to permit the Secretary to carry out the preceding sentence." Subsec. (f). Pub. L. 101-510, Sec. 836(a), added subsec. (f). 1988 - Subsec. (e). Pub. L. 100-370 added subsec. (e). 1973 - Subsec. (d). Pub. L. 93-155 added subsec. (d). 1958 - Pub. L. 85-800 authorized advance or other payments under contracts for property or services by agency, authorized insertion in bid solicitations of provision limiting advance or progress payments to small business concerns, restricted payments under subsec. (a) to unpaid contract price, and reworded generally conditions for making advance payments. EFFECTIVE DATE OF 1994 AMENDMENT For effective date and applicability of amendment by Pub. L. 103- 355, see section 10001 of Pub. L. 103-355, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1990 AMENDMENT Section 836(c) of Pub. L. 101-510, as amended by Pub. L. 102-25, title VII, Sec. 701(j)(2)(B), Apr. 6, 1991, 105 Stat. 116, provided that: "The provisions of section 2307 of title 10, United States Code, that are added by the amendments made by subsections (a) and (b) shall apply with respect to contracts entered into on or after May 6, 1991." RELATIONSHIP OF 1994 AMENDMENT TO PROMPT PAYMENT REQUIREMENTS Section 2001(h) of Pub. L. 103-355 provided that: "The amendments made by this section [amending this section and section 7522 of this title and repealing sections 7312, 7364, and 7521 of this title] are not intended to impair or modify procedures required by the provisions of chapter 39 of title 31, United States Code, and the regulations issued pursuant to such provisions of law (as such procedures are in effect on the date of the enactment of this Act [Oct. 13, 1994]), except that the Government may accept payment terms offered by a contractor offering a commercial item." LIMITATIONS ON PROGRESS PAYMENTS Pub. L. 99-145, title IX, Sec. 916, Nov. 8, 1985, 99 Stat. 688, which required Secretary of Defense to ensure that any progress payment under a defense contract be commensurate with work accomplished at standard of quality in contract, that such payments be limited to 80 percent of work accomplished so long as contract terms are indefinite, that this provision be waived for small purchases, and that this provision apply only to contracts for which solicitations were issued on or after 150 days after Nov. 8, 1985, was repealed and restated in subsec. (e) of this section by Pub. L. 100-370, Sec. 1(f)(1), July 19, 1988, 102 Stat. 846. OBLIGATIONS ENTERED INTO BEFORE NOVEMBER 16, 1973 Section 807(e) of Pub. L. 93-155 provided that: "The amendments made by this section [amending this section, section 1431 of Title 50, War and National Defense, and sections 468 and 2092 of Appendix to Title 50] shall not affect the carrying out of any contract, loan, guarantee, commitment, or other obligation entered into prior to the date of enactment of this section [Nov. 16, 1973]." -End- -CITE- 10 USC Sec. 2308 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2308. Buy-to-budget acquisition: end items -STATUTE- (a) Authority To Acquire Additional End Items. - Using funds available to the Department of Defense for the acquisition of an end item, the head of an agency making the acquisition may acquire a higher quantity of the end item than the quantity specified for the end item in a law providing for the funding of that acquisition if that head of an agency makes each of the following findings: (1) The agency has an established requirement for the end item that is expected to remain substantially unchanged throughout the period of the acquisition. (2) It is possible to acquire the higher quantity of the end item without additional funding because of production efficiencies or other cost reductions. (3) The amount of the funds used for the acquisition of the higher quantity of the end item will not exceed the amount provided under that law for the acquisition of the end item. (4) The amount so provided is sufficient to ensure that each unit of the end item acquired within the higher quantity is fully funded as a complete end item. (b) Regulations. - The Secretary of Defense shall prescribe regulations for the administration of this section. The regulations shall include, at a minimum, the following: (1) The level of approval within the Department of Defense that is required for a decision to acquire a higher quantity of an end item under subsection (a). (2) Authority (subject to subsection (a)) to acquire up to 10 percent more than the quantity of an end item approved in a justification and approval of the use of procedures other than competitive procedures for the acquisition of the end item under section 2304 of this title. (c) Notification of Congress. - The head of an agency is not required to notify Congress in advance regarding a decision under the authority of this section to acquire a higher quantity of an end item than is specified in a law described in subsection (a), but shall notify the congressional defense committees of the decision not later than 30 days after the date of the decision. (d) Waiver by Other Law. - A provision of law may not be construed as prohibiting the acquisition of a higher quantity of an end item under this section unless that provision of law - (1) specifically refers to this section; and (2) specifically states that the acquisition of the higher quantity of the end item is prohibited notwithstanding the authority provided in this section. (e) Definitions. - (1) For the purposes of this section, a quantity of an end item shall be considered specified in a law if the quantity is specified either in a provision of that law or in any related representation that is set forth separately in a table, chart, or explanatory text included in a joint explanatory statement or governing committee report accompanying the law. (2) In this section: (A) The term "end item" means a production product assembled, completed, and ready for issue or deployment. (B) The term "head of an agency" means the Secretary of Defense, the Secretary of the Army, the Secretary of the Navy, and the Secretary of the Air Force. -SOURCE- (Added Pub. L. 107-314, div. A, title VIII, Sec. 801(a)(1), Dec. 2, 2002, 116 Stat. 2600; amended Pub. L. 108-136, div. A, title X, Sec. 1043(b)(11), Nov. 24, 2003, 117 Stat. 1611.) -MISC1- PRIOR PROVISIONS A prior section 2308, acts Aug. 10, 1956, ch. 1041, 70A Stat. 131; Oct. 23, 1992, Pub. L. 102-484, div. A, title VIII, Sec. 820(a), 106 Stat. 2458; May 31, 1993, Pub. L. 103-35, title II, Sec. 201(e)(2), 107 Stat. 99; Nov. 30, 1993, Pub. L. 103-160, div. A, title IX, Sec. 904(d)(1), 107 Stat. 1728, related to assignment and delegation of procurement functions and responsibilities, prior to repeal by Pub. L. 103-355, title I, Sec. 1503(b)(1), title X, Sec. 10001, Oct. 13, 1994, 108 Stat. 3297, 3404, effective Oct. 13, 1994, except as otherwise provided. AMENDMENTS 2003 - Subsec. (e)(2). Pub. L. 108-136 redesignated subpars. (B) and (C) as (A) and (B), respectively, and struck out former subpar. (A) which read as follows: "The term 'congressional defense committees' means - "(i) the Committee on Armed Services and the Committee on Appropriations of the Senate; and "(ii) the Committee on Armed Services and the Committee on Appropriations of the House of Representatives." TIME FOR ISSUANCE OF FINAL REGULATIONS Pub. L. 107-314, div. A, title VIII, Sec. 801(b), Dec. 2, 2002, 116 Stat. 2602, provided that: "The Secretary of Defense shall issue the final regulations under section 2308(b) of title 10, United States Code (as added by subsection (a)), not later than 120 days after the date of the enactment of this Act [Dec. 2, 2002]." -End- -CITE- 10 USC Sec. 2309 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2309. Allocation of appropriations -STATUTE- (a) Appropriations available for procurement by an agency named in section 2303 of this title may, through administrative allotment, be made available for obligation for procurement by any other agency in amounts authorized by the head of the allotting agency and without transfer of funds on the books of the Department of the Treasury. (b) A disbursing official of the allotting agency may make any disbursement chargeable to an allotment under subsection (a) upon a voucher certified by an officer or civilian employee of the procuring agency. -SOURCE- (Aug. 10, 1956, ch. 1041, 70A Stat. 132; Pub. L. 97-258, Sec. 2(b)(1)(B), Sept. 13, 1982, 96 Stat. 1052.) -MISC1- HISTORICAL AND REVISION NOTES -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2309(a) 41:159 (2d sentence). Feb. 19, 1948, ch. 65, Sec. 10 (less 1st sentence), 62 Stat. 25. 2309(b) 41:159 (less 1st and 2d sentences). -------------------------------------------------------------------- In subsection (a), the words "an agency named in section 2303 of this title" are substituted for the words "any such agency". In subsection (b), the words "an allotment under subsection (a)" are substituted for the words "such allotments". AMENDMENTS 1982 - Subsec. (b). Pub. L. 97-258 substituted "disbursing official" for "disbursing officer". -End- -CITE- 10 USC Sec. 2310 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2310. Determinations and decisions -STATUTE- (a) Individual or Class Determinations and Decisions Authorized. - Determinations and decisions required to be made under this chapter by the head of an agency may be made for an individual purchase or contract or, except to the extent expressly prohibited by another provision of law, for a class of purchases or contracts. Such determinations and decisions are final. (b) Written Findings Required. - (1) Each determination or decision under section 2306(g)(1), 2307(d), or 2313(c)(2)(B) of this title shall be based on a written finding by the person making the determination or decision. The finding shall set out facts and circumstances that support the determination or decision. (2) Each finding referred to in paragraph (1) is final. The head of the agency making such finding shall maintain a copy of the finding for not less than 6 years after the date of the determination or decision. -SOURCE- (Aug. 10, 1956, ch. 1041, 70A Stat. 132; Pub. L. 85-800, Sec. 10, Aug. 28, 1958, 72 Stat. 967; Pub. L. 87-653, Sec. 1(f), Sept. 10, 1962, 76 Stat. 529; Pub. L. 89-607, Sec. 1(1), Sept. 27, 1966, 80 Stat. 850; Pub. L. 90-378, Sec. 2, July 5, 1968, 82 Stat. 290; Pub. L. 98-369, div. B, title VII, Sec. 2725, July 18, 1984, 98 Stat. 1193; Pub. L. 99-145, title XIII, Sec. 1303(a)(16), Nov. 8, 1985, 99 Stat. 739; Pub. L. 103-355, title I, Sec. 1504, Oct. 13, 1994, 108 Stat. 3297.) -MISC1- HISTORICAL AND REVISION NOTES -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2310(a) 41:156(a) (1st sentence). Feb. 19, 1948, ch. 65, Sec. 7(a) (1st sentence), (c), 62 Stat. 24. 2310(b) 41:156(c). -------------------------------------------------------------------- In subsection (a), the words "required * * * under" are substituted for the words "provided in". In subsection (b), the word "person" is substituted for the word "official". The words "to which it applies" are inserted for clarity. AMENDMENTS 1994 - Pub. L. 103-355 amended section generally. Prior to amendment, section read as follows: "(a) Determinations and decisions required to be made under this chapter by the head of an agency may be made for an individual purchase or contract or, except for determinations and decisions under section 2304 or 2305 of this title, for a class of purchases or contracts. Such a determination or decision, including a determination or decision under section 2304 or 2305 of this title, is final. "(b) Each determination or decision under section 2306(c), 2306(g)(1), 2307(c), or 2313(c) of this title shall be based on a written finding by the person making the determination or decision, which finding shall set out facts and circumstances that - "(1) clearly indicate why the type of contract selected under section 2306(c) of this title is likely to be less costly than any other type or that it is impracticable to obtain property or services of the kind or quality required except under such a contract; "(2) support the findings required by section 2306(g)(1) of this title; "(3) clearly indicate why advance payments under section 2307(c) of this title would be in the public interest; or "(4) clearly indicate why the application of section 2313(b) of this title to a contract or subcontract with a foreign contractor or foreign subcontractor would not be in the public interest. Such a finding is final and shall be kept available in the agency for at least six years after the date of the determination or decision. A copy of the finding shall be submitted to the General Accounting Office with each contract to which it applies." 1985 - Subsec. (a). Pub. L. 99-145 inserted "this" after "2305 of". 1984 - Subsec. (a). Pub. L. 98-369, Sec. 2725(1), inserted ", except for determinations and decisions under section 2304 or 2305 of title," and ", including a determination or decision under section 2304 or 2305 of this title,". Subsec. (b). Pub. L. 98-369, Sec. 2725(2), amended subsec. (b) generally, striking out requirement that determinations to negotiate contracts be based on written findings by the contracting officers making the determinations. 1968 - Subsec. (b). Pub. L. 90-378 inserted "section 2306 (g)(1)," after "clauses (11)-(16) of section 2304(a), section 2306(c),", and "(3) support the findings required by section 2306(g)(1)," after "kind or quality required except under such a contract,", and redesignated former cls. (3) to (5) as (4) to (6), respectively. 1966 - Subsec. (b). Pub. L. 89-607 inserted reference to section 2313(c), added cl. (4), and redesignated former cl. (4) as (5). 1962 - Subsec. (b). Pub. L. 87-653 substituted "section 2306(c)" for "section 2306", required decisions to negotiate contracts under section 2304(a)(2), (7), (8), (10) to (12) of this title to be based on a written finding by the person making the decision, which findings shall set out facts and circumstances illustrative of conditions described in section 2304(a)(11) to (16), indicate why the type of contract selected under section 2306(c) is likely to be less costly than any other or that its impracticable to obtain the required property or services except under such contract, indicate why advance payments under section 2307(c) would be in the public interest, or establish with respect to section 2304(a), (2), (7), (8), (10) to (12) that formal advertising would not have been feasible and practicable. 1958 - Subsec. (b). Pub. L. 85-800 substituted "2307(c)" for "2307(a)". EFFECTIVE DATE OF 1994 AMENDMENT For effective date and applicability of amendment by Pub. L. 103- 355, see section 10001 of Pub. L. 103-355, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1984 AMENDMENT Amendment by Pub. L. 98-369 applicable with respect to any solicitation for bids or proposals issued after Mar. 31, 1985, see section 2751 of Pub. L. 98-369, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1962 AMENDMENT For effective date of amendment by Pub. L. 87-653, see section 1(h) of Pub. L. 87-653, set out as a note under section 2304 of this title. -End- -CITE- 10 USC Sec. 2311 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2311. Assignment and delegation of procurement functions and responsibilities -STATUTE- (a) In General. - Except to the extent expressly prohibited by another provision of law, the head of an agency may delegate, subject to his direction, to any other officer or official of that agency, any power under this chapter. (b) Procurements For or With Other Agencies. - Subject to subsection (a), to facilitate the procurement of property and services covered by this chapter by each agency named in section 2303 of this title for any other agency, and to facilitate joint procurement by those agencies - (1) the head of an agency may delegate functions and assign responsibilities relating to procurement to any officer or employee within such agency; (2) the heads of two or more agencies may by agreement delegate procurement functions and assign procurement responsibilities from one agency to another of those agencies or to an officer or civilian employee of another of those agencies; and (3) the heads of two or more agencies may create joint or combined offices to exercise procurement functions and responsibilities. (c) Approval of Terminations and Reductions of Joint Acquisition Programs. - (1) The Secretary of Defense shall prescribe regulations that prohibit each military department participating in a joint acquisition program approved by the Under Secretary of Defense for Acquisition, Technology, and Logistics from terminating or substantially reducing its participation in such program without the approval of the Under Secretary. (2) The regulations shall include the following provisions: (A) A requirement that, before any such termination or substantial reduction in participation is approved, the proposed termination or reduction be reviewed by the Joint Requirements Oversight Council of the Department of Defense. (B) A provision that authorizes the Under Secretary of Defense for Acquisition, Technology, and Logistics to require a military department whose participation in a joint acquisition program has been approved for termination or substantial reduction to continue to provide some or all of the funding necessary for the acquisition program to be continued in an efficient manner. -SOURCE- (Aug. 10, 1956, ch. 1041, 70A Stat. 132; Pub. L. 85-800, Sec. 11, Aug. 28, 1958, 72 Stat. 967; Pub. L. 87-653, Sec. 1(g), Sept. 10, 1962, 76 Stat. 529; Pub. L. 90-378, Sec. 3, July 5, 1968, 82 Stat. 290; Pub. L. 97-86, title IX, Secs. 907(c), 909(f), Dec. 1, 1981, 95 Stat. 1117, 1120; Pub. L. 98-369, div. B, title VII, Sec. 2726, July 18, 1984, 98 Stat. 1194; Pub. L. 98-525, title XII, Sec. 1214, Oct. 19, 1984, 98 Stat. 2592; Pub. L. 98-577, title V, Sec. 505, Oct. 30, 1984, 98 Stat. 3087; Pub. L. 103-355, title I, Sec. 1503(a)(1), Oct. 13, 1994, 108 Stat. 3296; Pub. L. 107-107, div. A, title X, Sec. 1048(b)(2), Dec. 28, 2001, 115 Stat. 1225.) -MISC1- HISTORICAL AND REVISION NOTES -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2311 41:156(a) (less 1st Feb. 19, 1948, ch. 65, sentence). Sec. 7(a) (less 1st sentence), (b), 62 Stat. 24. 41:156(b). -------------------------------------------------------------------- The words "in his discretion and" and "including the making of such determinations and decisions" are omitted as surplusage. The words "except the power to make determinations and decisions" are substituted for the words "Except as provided in subsection (b) of this section" and "The power of the agency head to make the determinations or decisions specified in paragraphs (12)-(16) of section 151(c) of this title and in section 154(a) of this title shall not be delegable". PRIOR PROVISIONS Provisions similar to those in this section were contained in section 2308 of this title prior to repeal by Pub. L. 103-355, Sec. 1503(b)(1). AMENDMENTS 2001 - Subsec. (c)(1), (2)(B). Pub. L. 107-107 substituted "Under Secretary of Defense for Acquisition, Technology, and Logistics" for "Under Secretary of Defense for Acquisition and Technology". 1994 - Pub. L. 103-355 substituted "Assignment and delegation of procurement functions and responsibilities" for "Delegation" as section catchline and amended text generally. Prior to amendment, text read as follows: "Except as provided in section 2304(d)(2) of this title, the head of an agency may delegate, subject to his direction, to any other officer or official of that agency, any power under this chapter." 1984 - Pub. L. 98-577 struck out "(a)" before "Except as provided in" and struck out subsec. (b) which related to delegation of authority by heads of procuring activities of agencies of certain functions. Pub. L. 98-525 designated existing provisions as subsec. (a) and added subsec. (b). Pub. L. 98-369 inserted provision relating to the exception provided in section 2304(d)(2) of this title and struck out provision that the power to make determinations and decisions under cls. (11)-(16) of section 2304(a) of this title could not be delegated, but that the power to make a determination or decision under section 2304(a)(11) of this title could be delegated to any other officer of official of that agency who was responsible for procurement, and only for contracts requiring the expenditure of not more than $5,000,000. 1981 - Pub. L. 97-86 struck out in first sentence cl. (1) designation and cl. (2) relating to authorizing of contracts in excess of three years under section 2306(g) of this title, and in second sentence substituted "$5,000,000" for "$100,000". 1968 - Pub. L. 90-378 designated provisions after "the power to make determinations and decisions" as cl. (1) and added cl. (2). 1962 - Pub. L. 87-653 substituted "delegated to any other officer" for "delegated only to a chief officer" and "$100,000" for "$25,000". 1958 - Pub. L. 85-800 struck out ", or section 2307(a)" after "of section 2304(a)" in first sentence. EFFECTIVE DATE OF 1994 AMENDMENT For effective date and applicability of amendment by Pub. L. 103- 355, see section 10001 of Pub. L. 103-355, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1984 AMENDMENT Amendment by Pub. L. 98-369 applicable with respect to any solicitation for bids or proposals issued after Mar. 31, 1985, see section 2751 of Pub. L. 98-369, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1962 AMENDMENT For effective date of amendment by Pub. L. 87-653, see section 1(h) of Pub. L. 87-653, set out as a note under section 2304 of this title. -End- -CITE- 10 USC Sec. 2312 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2312. Remission of liquidated damages -STATUTE- Upon the recommendation of the head of an agency, the Secretary of the Treasury may remit all or part, as he considers just and equitable, of any liquidated damages assessed for delay in performing a contract, made by that agency, that provides for such damages. -SOURCE- (Aug. 10, 1956, ch. 1041, 70A Stat. 132; Pub. L. 104-316, title II, Sec. 202(c), Oct. 19, 1996, 110 Stat. 3842.) -MISC1- HISTORICAL AND REVISION NOTES -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2312 41:155. Feb. 19, 1948, ch. 65, Sec. 6, 62 Stat. 24. -------------------------------------------------------------------- The words "a contract, made by that agency, that provides for" are substituted for the words "any contract made on behalf of the Government by the agency head or by officers authorized by him so to do includes a provision". AMENDMENTS 1996 - Pub. L. 104-316 substituted "Secretary of the Treasury" for "Comptroller General". -End- -CITE- 10 USC Sec. 2313 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2313. Examination of records of contractor -STATUTE- (a) Agency Authority. - (1) The head of an agency, acting through an authorized representative, is authorized to inspect the plant and audit the records of - (A) a contractor performing a cost-reimbursement, incentive, time-and-materials, labor-hour, or price-redeterminable contract, or any combination of such contracts, made by that agency under this chapter; and (B) a subcontractor performing any cost-reimbursement, incentive, time-and-materials, labor-hour, or price- redeterminable subcontract or any combination of such subcontracts under a contract referred to in subparagraph (A). (2) The head of an agency, acting through an authorized representative, is authorized, for the purpose of evaluating the accuracy, completeness, and currency of certified cost or pricing data required to be submitted pursuant to section 2306a of this title with respect to a contract or subcontract, to examine all records of the contractor or subcontractor related to - (A) the proposal for the contract or subcontract; (B) the discussions conducted on the proposal; (C) pricing of the contract or subcontract; or (D) performance of the contract or subcontract. (b) DCAA Subpoena Authority. - (1) The Director of the Defense Contract Audit Agency (or any successor agency) may require by subpoena the production of any records of a contractor that the Secretary of Defense is authorized to audit or examine under subsection (a). (2) Any such subpoena, in the case of contumacy or refusal to obey, shall be enforceable by order of an appropriate United States district court. (3) The authority provided by paragraph (1) may not be redelegated. (c) Comptroller General Authority. - (1) Except as provided in paragraph (2), each contract awarded after using procedures other than sealed bid procedures shall provide that the Comptroller General and his representatives are authorized to examine any records of the contractor, or any of its subcontractors, that directly pertain to, and involve transactions relating to, the contract or subcontract and to interview any current employee regarding such transactions. (2) Paragraph (1) does not apply to a contract or subcontract with a foreign contractor or foreign subcontractor if the head of the agency concerned determines, with the concurrence of the Comptroller General or his designee, that the application of that paragraph to the contract or subcontract would not be in the public interest. However, the concurrence of the Comptroller General or his designee is not required - (A) where the contractor or subcontractor is a foreign government or agency thereof or is precluded by the laws of the country involved from making its records available for examination; and (B) where the head of the agency determines, after taking into account the price and availability of the property and services from United States sources, that the public interest would be best served by not applying paragraph (1). (3) Paragraph (1) may not be construed to require a contractor or subcontractor to create or maintain any record that the contractor or subcontractor does not maintain in the ordinary course of business or pursuant to another provision of law. (d) Limitation on Audits Relating to Indirect Costs. - The head of an agency may not perform an audit of indirect costs under a contract, subcontract, or modification before or after entering into the contract, subcontract, or modification in any case in which the contracting officer determines that the objectives of the audit can reasonably be met by accepting the results of an audit that was conducted by any other department or agency of the Federal Government within one year preceding the date of the contracting officer's determination. (e) Limitation. - The authority of the head of an agency under subsection (a), and the authority of the Comptroller General under subsection (c), with respect to a contract or subcontract shall expire three years after final payment under such contract or subcontract. (f) Inapplicability to Certain Contracts. - This section does not apply to the following contracts: (1) Contracts for utility services at rates not exceeding those established to apply uniformly to the public, plus any applicable reasonable connection charge. (2) A contract or subcontract that is for an amount not greater than the simplified acquisition threshold. (g) Forms of Original Record Storage. - Nothing in this section shall be construed to preclude a contractor from duplicating or storing original records in electronic form. (h) Use of Images of Original Records. - The head of an agency shall not require a contractor or subcontractor to provide original records in an audit carried out pursuant to this section if the contractor or subcontractor provides photographic or electronic images of the original records and meets the following requirements: (1) The contractor or subcontractor has established procedures to ensure that the imaging process preserves the integrity, reliability, and security of the original records. (2) The contractor or subcontractor maintains an effective indexing system to permit timely and convenient access to the imaged records. (3) The contractor or subcontractor retains the original records for a minimum of one year after imaging to permit periodic validation of the imaging systems. (i) Records Defined. - In this section, the term "records" includes books, documents, accounting procedures and practices, and other data, regardless of type and regardless of whether such items are in written form, in the form of computer data, or in any other form. -SOURCE- (Aug. 10, 1956, ch. 1041, 70A Stat. 132; Pub. L. 89-607, Sec. 1(2), Sept. 27, 1966, 80 Stat. 850; Pub. L. 98-369, div. B, title VII, Sec. 2727(c), July 18, 1984, 98 Stat. 1195; Pub. L. 99-145, title IX, Sec. 935, Nov. 8, 1985, 99 Stat. 700; Pub. L. 100-26, Sec. 7(g)(1), Apr. 21, 1987, 101 Stat. 282; Pub. L. 101-510, div. A, title XIII, Sec. 1301(9), Nov. 5, 1990, 104 Stat. 1668; Pub. L. 103- 355, title II, Sec. 2201(a)(1), title IV, Sec. 4102(c), Oct. 13, 1994, 108 Stat. 3316, 3340; Pub. L. 104-106, div. A, title XV, Sec. 1502(a)(1), Feb. 10, 1996, 110 Stat. 502; Pub. L. 104-201, div. A, title VIII, Sec. 808(a), Sept. 23, 1996, 110 Stat. 2607; Pub. L. 106-65, div. A, title X, Sec. 1032(a)(2), Oct. 5, 1999, 113 Stat. 751; Pub. L. 110-417, [div. A], title VIII, Sec. 871(b), Oct. 14, 2008, 122 Stat. 4555.) -MISC1- HISTORICAL AND REVISION NOTES -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2313(a) 41:153(b) (words after Feb. 19, 1948, ch. 65, semicolon of last Sec. 4(b) (words after sentence). semicolon of last sentence), 62 Stat. 23. 2313(b) 41:153(c). Feb. 19, 1948, ch. 65, Sec. 4(c); added Oct. 31, 1951, ch. 652 (as applicable to Sec. 4(c); of the Act of Feb. 19, 1948, ch. 65), 65 Stat. 700. -------------------------------------------------------------------- In subsection (a), the words "An agency named in section 2303 of this title" are substituted for the words "a procuring agency". The words "made by that agency under this chapter" are inserted for clarity. In subsection (b), the word "under" is substituted for the words "pursuant to authority contained in". The word "provide" is substituted for the words "include a clause to the effect". The words "are entitled" are substituted for the words "shall * * * have * * * the right". The words "of the United States", "duly authorized", "have access to and", and "engaged in the performance of" are omitted as surplusage. AMENDMENTS 2008 - Subsec. (c)(1). Pub. L. 110-417 inserted "and to interview any current employee regarding such transactions" before period at end. 1999 - Subsec. (b)(4). Pub. L. 106-65 struck out par. (4) which read as follows: "The Director (or any successor official) shall submit an annual report to the Secretary of Defense on the exercise of such authority during the preceding year and the reasons why such authority was exercised in any instance. The Secretary shall forward a copy of each such report to the Committee on Armed Services of the Senate and the Committee on National Security of the House of Representatives." 1996 - Subsec. (b)(4). Pub. L. 104-106 substituted "Committee on Armed Services of the Senate and the Committee on National Security of the House of Representatives" for "Committees on Armed Services of the Senate and House of Representatives". Subsec. (d). Pub. L. 104-201 amended subsec. (d) generally. Prior to amendment, subsec. (d) read as follows: "Limitation on Preaward Audits Relating to Indirect Costs. - The head of an agency may not perform a preaward audit to evaluate proposed indirect costs under any contract, subcontract, or modification to be entered into in accordance with this chapter in any case in which the contracting officer determines that the objectives of the audit can reasonably be met by accepting the results of an audit conducted by any other department or agency of the Federal Government within one year preceding the date of the contracting officer's determination." 1994 - Pub. L. 103-355, Sec. 2201(a)(1), amended section generally, striking out "of books" before "and records" in section catchline, and substituting subsecs. (a) to (i) for former subsecs. (a) to (d). Subsec. (f)(2). Pub. L. 103-355, Sec. 4102(c), added par. (2). 1990 - Subsec. (c). Pub. L. 101-510 struck out after cl. (2) "If subsection (b) is not applied to a contract or subcontract based on a determination under clause (2), a written report shall be furnished to the Congress." 1987 - Subsec. (d)(1). Pub. L. 100-26 substituted "section 2306a" for "section 2306(f)". 1985 - Subsec. (d). Pub. L. 99-145 added subsec. (d). 1984 - Subsec. (b). Pub. L. 98-369 substituted "awarded after using procedures other than sealed bid procedures" for "negotiated under this chapter". 1966 - Subsec. (b). Pub. L. 89-607, Sec. 1(2)(A), substituted "Except as provided in subsection (c), each" for "Each". Subsec. (c). Pub. L. 89-607, Sec. 1(2)(B), added subsec. (c). EFFECTIVE DATE OF 1994 AMENDMENT For effective date and applicability of amendment by Pub. L. 103- 355, see section 10001 of Pub. L. 103-355, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1984 AMENDMENT Amendment by Pub. L. 98-369 applicable with respect to any solicitation for bids or proposals issued after Mar. 31, 1985, see section 2751 of Pub. L. 98-369, set out as a note under section 2302 of this title. ADDITIONAL ACCESS TO CONTRACTOR AND SUBCONTRACTOR RECORDS IN THE UNITED STATES CENTRAL COMMAND THEATER OF OPERATIONS Pub. L. 112-81, div. A, title VIII, Sec. 842, Dec. 31, 2011, 125 Stat. 1513, provided that: "(a) Department of Defense Contracts, Grants, and Cooperative Agreements. - "(1) In general. - Not later than 30 days after the date of the enactment of this Act [Dec. 31, 2011], the Secretary of Defense shall revise the Department of Defense Supplement to the Federal Acquisition Regulation to require that - "(A) the clause described in paragraph (2) shall be included in each covered contract, grant, and cooperative agreement of the Department of Defense that is awarded on or after the date of the enactment of this Act; and "(B) to the maximum extent practicable, each covered contract, grant, and cooperative agreement of the Department that is awarded before the date of the enactment of this Act shall be modified to include the clause described in paragraph (2). "(2) Clause. - The clause described in this paragraph is a clause authorizing the Secretary, upon a written determination pursuant to paragraph (3), to examine any records of the contractor, the recipient of a grant or cooperative agreement, or any subcontractor or subgrantee under such contract, grant, or cooperative agreement to the extent necessary to ensure that funds available under the contract, grant, or cooperative agreement - "(A) are not subject to extortion or corruption; and "(B) are not provided directly or indirectly to persons or entities that are actively supporting an insurgency or otherwise actively opposing United States or coalition forces in a contingency operation. "(3) Written determination. - The authority to examine records pursuant to the contract clause described in paragraph (2) may be exercised only upon a written determination by the contracting officer or comparable official responsible for a grant or cooperative agreement, upon a finding by the Commander of the United States Central Command, that there is reason to believe that funds available under the contract, grant, or cooperative agreement concerned may have been subject to extortion or corruption or may have been provided directly or indirectly to persons or entities that are actively supporting an insurgency or otherwise actively opposing United States or coalition forces in a contingency operation. "(4) Flowdown. - A clause described in paragraph (2) shall also be required in any subcontract or subgrant under a covered contract, grant, or cooperative agreement if the subcontract or subgrant has an estimated value in excess of $100,000. "(b) Reports. - Not later than March 1 of each of 2013, 2014, and 2015, the Secretary shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report on the use of the authority provided by this section in the preceding calendar year. Each report shall identify, for the calendar year covered by such report, each instance in which the Department of Defense exercised the authority provided under this section to examine records, explain the basis for the action taken, and summarize the results of any examination of records so undertaken,[.] Any report under this subsection may be submitted in classified form. "(c) Definitions. - In this section: "(1) The term 'contingency operation' has the meaning given that term in section 101(a)(13) of title 10, United States Code. "(2) The term 'covered contract, grant, or cooperative agreement' means a contract, grant, or cooperative agreement with an estimated value in excess of $100,000 that will be performed in the United States Central Command theater of operations in support of a contingency operation. "(d) Sunset. - "(1) In general. - The clause described by subsection (a)(2) shall not be required in any contract, grant, or cooperative agreement that is awarded after the date that is three years after the date of the enactment of this Act [Dec. 31, 2011]. "(2) Continuing effect of clauses included before sunset. - Any clause described by subsection (a)(2) that is included in a contract, grant, or cooperative agreement pursuant to this section before the date specified in paragraph (1) shall remain in effect in accordance with its terms." EXEMPTION OF FUNCTIONS Functions with respect to purchases authorized to be made outside limits of United States or District of Columbia under Foreign Assistance Act of 1961, as amended, as exempt, see Ex. Ord. No. 11223, May 12, 1965, 30 F.R. 6635, set out as a note under section 2393 of Title 22, Foreign Relations and Intercourse. FOREIGN CONTRACTORS Secretaries of Defense, Army, Navy, or Air Force, or their designees, to determine, prior to exercising authority provided in amendment of this section by Pub. L. 89-607 to exempt certain contracts with foreign contractors from requirement of an examination-of-records clause, that all reasonable efforts have been made to include such examination-of-records clause, as required by par. (11) of Part I of Ex. Ord. No. 10789, and that alternate sources of supply are not reasonably available, see par. (11) of Part I of Ex. Ord. No. 10789, Nov. 14, 1958, 23 F.R. 8897, as amended, set out as a note under section 1431 of Title 50, War and National Defense. -End- -CITE- 10 USC Sec. 2313a 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2313a. Defense Contract Audit Agency: annual report -STATUTE- (a) Required Report. - The Director of the Defense Contract Audit Agency shall prepare an annual report of the activities of the Agency during the previous fiscal year. The report shall include, at a minimum - (1) a description of significant problems, abuses, and deficiencies encountered during the conduct of contractor audits; (2) statistical tables showing - (A) the total number of audit reports completed and pending; (B) the priority given to each type of audit; (C) the length of time taken for each type of audit; (D) the total dollar value of questioned costs (including a separate category for the dollar value of unsupported costs); and (E) an assessment of the number and types of audits pending for a period longer than allowed pursuant to guidance of the Defense Contract Audit Agency; (3) a summary of any recommendations of actions or resources needed to improve the audit process; and (4) any other matters the Director considers appropriate. (b) Submission of Annual Report. - Not later than March 30 of each year, the Director shall submit to the congressional defense committees the report required by subsection (a). (c) Public Availability. - Not later than 60 days after the submission of an annual report to the congressional defense committees under subsection (b), the Director shall make the report available on the publicly available website of the Agency or such other publicly available website as the Director considers appropriate. -SOURCE- (Added Pub. L. 112-81, div. A, title VIII, Sec. 805(a), Dec. 31, 2011, 125 Stat. 1486.) -End- -CITE- 10 USC Sec. 2314 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2314. Laws inapplicable to agencies named in section 2303 of this title -STATUTE- Sections 6101(b)-(d) and 6304 of title 41 do not apply to the procurement or sale of property or services by the agencies named in section 2303 of this title. -SOURCE- (Aug. 10, 1956, ch. 1041, 70A Stat. 133; Pub. L. 96-513, title V, Sec. 511(78), Dec. 12, 1980, 94 Stat. 2927; Pub. L. 103-160, div. A, title VIII, Sec. 822(b)(2), Nov. 30, 1993, 107 Stat. 1706; Pub. L. 111-350, Sec. 5(b)(16), Jan. 4, 2011, 124 Stat. 3843.) -MISC1- HISTORICAL AND REVISION NOTES -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2314 41:160. Feb. 19, 1948, ch. 65, Sec. 11(b), 62 Stat. 25. -------------------------------------------------------------------- AMENDMENTS 2011 - Pub. L. 111-350 substituted "Sections 6101(b)-(d) and 6304 of title 41" for "Sections 3709 and 3735 of the Revised Statutes (41 U.S.C. 5 and 13)". 1993 - Pub. L. 103-160 inserted "or sale" after "procurement". 1980 - Pub. L. 96-513 substituted "Sections 3709 and 3735 of the Revised Statutes (41 U.S.C. 5 and 13)" for "Sections 5, 6, 6a, and 13 of title 41". EFFECTIVE DATE OF 1980 AMENDMENT Amendment by Pub. L. 96-513 effective Dec. 12, 1980, see section 701(b)(3) of Pub. L. 96-513, set out as a note under section 101 of this title. -End- -CITE- 10 USC Sec. 2315 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2315. Law inapplicable to the procurement of automatic data processing equipment and services for certain defense purposes -STATUTE- For purposes of subtitle III of title 40, the term "national security system", with respect to a telecommunications and information system operated by the Department of Defense, has the meaning given that term by section 3542(b)(2) of title 44. -SOURCE- (Added Pub. L. 97-86, title IX, Sec. 908(a)(1), Dec. 1, 1981, 95 Stat. 1117; amended Pub. L. 97-295, Sec. 1(25), Oct. 12, 1982, 96 Stat. 1291; Pub. L. 104-106, div. E, title LVI, Sec. 5601(c), Feb. 10, 1996, 110 Stat. 699; Pub. L. 104-201, div. A, title X, Sec. 1074(b)(4)(B), Sept. 23, 1996, 110 Stat. 2660; Pub. L. 105-85, div. A, title X, Sec. 1073(a)(49), Nov. 18, 1997, 111 Stat. 1903; Pub. L. 107-217, Sec. 3(b)(5), Aug. 21, 2002, 116 Stat. 1295; Pub. L. 109-364, div. A, title IX, Sec. 906(c), Oct. 17, 2006, 120 Stat. 2354.) -MISC1- AMENDMENTS 2006 - Pub. L. 109-364 amended text generally. Prior to amendment, section consisted of subsecs. (a) and (b) defining "national security systems" as meaning telecommunications and information systems operated by the Department of Defense, the functions, operation or use of which involves intelligence or cryptologic activities, command and control of military forces, or equipment that is an integral part of a weapons system or is critical to military or intelligence missions but is not equipment or services to be used for routine administrative and business applications. 2002 - Subsec. (a). Pub. L. 107-217 substituted "subtitle III of title 40" for "division E of the Clinger-Cohen Act of 1996 (40 U.S.C. 1401 et seq.)" in introductory provisions. 1997 - Subsec. (a). Pub. L. 105-85 substituted "division E of the Clinger-Cohen Act of 1996 (40 U.S.C. 1401 et seq.)" for "the Information Technology Management Reform Act of 1996". 1996 - Subsec. (a). Pub. L. 104-106, as amended by Pub. L. 104- 201, substituted "For the purposes of the Information Technology Management Reform Act of 1996, the term 'national security systems' means those telecommunications and information systems operated by the Department of Defense, the functions, operation or use of which" for "Section 111 of the Federal Property and Administrative Services Act of 1949 (40 U.S.C. 759) is not applicable to the procurement by the Department of Defense of automatic data processing equipment or services if the function, operation, or use of the equipment or services". 1982 - Subsec. (a). Pub. L. 97-295 substituted "(40 U.S.C. 759)" for "(40 U.S.C. 795)". EFFECTIVE DATE OF 1996 AMENDMENT Amendment by Pub. L. 104-106 effective 180 days after Feb. 10, 1996, see section 5701 of Pub. L. 104-106, Feb. 10, 1996, 110 Stat. 702. EFFECTIVE DATE Section 908(b) of Pub. L. 97-86 provided that: "Section 2315 of title 10, United States Code, as added by subsection (a), does not apply to a contract made before the date of the enactment of this Act [Dec. 1, 1981]." LIMITATION REGARDING TELECOMMUNICATIONS REQUIREMENTS Pub. L. 103-337, div. A, title X, Sec. 1075, Oct. 5, 1994, 108 Stat. 2861, provided that: "(a) Limitation. - No funds available to the Department of Defense or any other Executive agency may be expended to provide for meeting Department of Defense telecommunications requirements through the telecommunications procurement known as 'FTS-2000' or through any other Government-wide telecommunications procurement until - "(1) the Secretary of Defense submits to the Congress a report containing - "(A) a certification by the Secretary that the FTS-2000 procurement or the other telecommunications procurement will provide assured, secure telecommunications support (including associated telecommunications services) for Department of Defense activities; and "(B) a description of how the procurement will be implemented and managed to meet defense information infrastructure requirements, including requirements to support deployed forces and intelligence activities; and "(2) 30 days elapse after the date on which such report is received by the committees. "(b) Definitions. - In this section: "(1) The term 'defense telecommunications requirements' means requirements for telecommunications equipment and services that, if procured by the Department of Defense, would be exempt from the requirements of section 111 of the Federal Property and Administrative Services Act of 1949 ([former] 40 U.S.C. 759) pursuant to section 2315 of title 10, United States Code. "(2) The term 'Executive agency' has the meaning given such term in section 105 of title 5, United States Code. "(3) The term 'procurement' has the meaning given such term in section 4 of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 403) [see 41 U.S.C. 111]. "(c) Effect on Other Law. - Nothing in this section may be construed as modifying or superseding, or as intended to impair or restrict authorities or responsibilities under - "(1) section 111 of the Federal Property and Administrative Services Act of 1949 ([former] 40 U.S.C. 759); or "(2) section 620 of Public Law 103-123 [107 Stat. 1264]." -End- -CITE- 10 USC Sec. 2316 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2316. Disclosure of identity of contractor -STATUTE- The Secretary of Defense may disclose the identity or location of a person awarded a contract by the Department of Defense to any individual, including a Member of Congress, only after the Secretary makes a public announcement identifying the contractor. When the identity of a contractor is to be made public, the Secretary shall announce publicly that the contract has been awarded and the identity of the contractor. -SOURCE- (Added Pub. L. 97-295, Sec. 1(26)(A), Oct. 12, 1982, 96 Stat. 1291.) -MISC1- HISTORICAL AND REVISION NOTES -------------------------------------------------------------------- Revised Source (U.S. Code) Source (Statutes at section Large) -------------------------------------------------------------------- 2316 10:2304 (note). Oct. 7, 1970, Pub. L. 91-441, Sec. 507, 84 Stat. 913. -------------------------------------------------------------------- The words "company, or corporation" are omitted as included in "person" because of section 1:1. The words "On and after the date of enactment of this Act" are omitted as executed. The word "contractor" is substituted for "person, company, or corporation to whom such contract has been awarded" and "person, company, or corporation to whom any defense contract has been awarded" to eliminate unnecessary words. The words "and the identity of the contractor" are substituted for "and to whom it was awarded" for clarity. -End- -CITE- 10 USC Sec. 2317 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2317. Repealed. -MISC1- [Sec. 2317. Repealed. Pub. L. 103-160, div. A, title VIII, Sec. 821(a)(2), Nov. 30, 1993, 107 Stat. 1704]. Section, added Pub. L. 98-525, title XII, Sec. 1215, Oct. 19, 1984, 98 Stat. 2592, related to encouragement of competition and cost savings. -End- -CITE- 10 USC Sec. 2318 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2318. Advocates for competition -STATUTE- (a)(1) In addition to the advocates for competition established or designated pursuant to section 1705(a) of title 41, the Secretary of Defense shall designate an officer or employee of the Defense Logistics Agency to serve as the advocate for competition of the agency. (2) The advocate for competition of the Defense Logistics Agency shall carry out the responsibilities and functions provided for in section 1705(b) and (c) of title 41. (b) Each advocate for competition of an agency named in section 2303(a) of this title shall be a general or flag officer if a member of the armed forces or a grade GS-16 or above under the General Schedule (or in a comparable or higher position under another schedule), if a civilian employee and shall be designated to serve for a minimum of two years. -SOURCE- (Added Pub. L. 98-525, title XII, Sec. 1216(a), Oct. 19, 1984, 98 Stat. 2593; amended Pub. L. 100-26, Sec. 7(d)(4), Apr. 21, 1987, 101 Stat. 281; Pub. L. 102-25, title VII, Sec. 701(f)(1), Apr. 6, 1991, 105 Stat. 115; Pub. L. 103-355, title I, Sec. 1031, Oct. 13, 1994, 108 Stat. 3260; Pub. L. 111-350, Sec. 5(b)(17), Jan. 4, 2011, 124 Stat. 3843.) -MISC1- AMENDMENTS 2011 - Subsec. (a)(1). Pub. L. 111-350, Sec. 5(b)(17)(A), substituted "section 1705(a) of title 41" for "section 20(a) of the Office of Federal Procurement Policy Act (41 U.S.C. 418(a))". Subsec. (a)(2). Pub. L. 111-350, Sec. 5(b)(17)(B), substituted "section 1705(b) and (c) of title 41" for "sections 20(b) and 20(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 418(b), (c))". 1994 - Subsec. (c). Pub. L. 103-355 struck out subsec. (c) which read as follows: "Each advocate for competition of an agency of the Department of Defense shall transmit to the Secretary of Defense a report describing his activities during the preceding year. The report of each advocate for competition shall be included in the annual report of the Secretary of Defense required by section 23 of the Office of Federal Procurement Policy Act (41 U.S.C. 419), in the form in which it was submitted to the Secretary." 1991 - Subsec. (c). Pub. L. 102-25 substituted "section 23" for "section 21". 1987 - Subsec. (a)(1). Pub. L. 100-26, Sec. 7(d)(4)(A), inserted "(41 U.S.C. 418(a))" after "Policy Act". Subsec. (a)(2). Pub. L. 100-26, Sec. 7(d)(4)(B), inserted "(41 U.S.C. 418(b), (c))" after "Policy Act". Subsec. (c). Pub. L. 100-26, Sec. 7(d)(4)(C), inserted "(41 U.S.C. 419)" after "Policy Act". EFFECTIVE DATE Section 1216(c)(1) of Pub. L. 98-525 provided that: "Section 2318 of title 10, United States Code (as added by subsection (a)), shall take effect on April 1, 1985." REFERENCES IN OTHER LAWS TO GS-16, 17, OR 18 PAY RATES References in laws to the rates of pay for GS-16, 17, or 18, or to maximum rates of pay under the General Schedule, to be considered references to rates payable under specified sections of Title 5, Government Organization and Employees, see section 529 [title I, Sec. 101(c)(1)] of Pub. L. 101-509, set out in a note under section 5376 of Title 5. -End- -CITE- 10 USC Sec. 2319 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2319. Encouragement of new competitors -STATUTE- (a) In this section, the term "qualification requirement" means a requirement for testing or other quality assurance demonstration that must be completed by an offeror before award of a contract. (b) Except as provided in subsection (c), the head of the agency shall, before establishing a qualification requirement - (1) prepare a written justification stating the necessity for establishing the qualification requirement and specify why the qualification requirement must be demonstrated before contract award; (2) specify in writing and make available to a potential offeror upon request all requirements which a prospective offeror, or its product, must satisfy in order to become qualified, such requirements to be limited to those least restrictive to meet the purposes necessitating the establishment of the qualification requirement; (3) specify an estimate of the costs of testing and evaluation likely to be incurred by a potential offeror in order to become qualified; (4) ensure that a potential offeror is provided, upon request and on a reimbursable basis, a prompt opportunity to demonstrate its ability to meet the standards specified for qualification using qualified personnel and facilities of the agency concerned or of another agency obtained through interagency agreement, or under contract, or other methods approved by the agency (including use of approved testing and evaluation services not provided under contract to the agency); (5) if testing and evaluation services are provided under contract to the agency for the purposes of clause (4), provide to the extent possible that such services be provided by a contractor who is not expected to benefit from an absence of additional qualified sources and who shall be required in such contract to adhere to any restriction on technical data asserted by the potential offeror seeking qualification; and (6) ensure that a potential offeror seeking qualification is promptly informed as to whether qualification is attained and, in the event qualification is not attained, is promptly furnished specific information why qualification was not attained. (c)(1) Subsection (b) of this section does not apply with respect to a qualification requirement established by statute or administrative action before October 19, 1984, unless such requirement is a qualified products list. (2)(A) Except as provided in subparagraph (B), if it is unreasonable to specify the standards for qualification which a prospective offeror or its product must satisfy, a determination to that effect shall be submitted to the advocate for competition of the procuring activity responsible for the purchase of the item subject to the qualification requirement. After considering any comments of the advocate for competition reviewing such determination, the head of the purchasing office may waive the requirements of clauses (2) through (6) of subsection (b) for up to two years with respect to the item subject to the qualification requirement. (B) The waiver authority provided in this paragraph does not apply with respect to a qualified products list. (3) A potential offeror may not be denied the opportunity to submit and have considered an offer for a contract solely because the potential offeror (A) is not on a qualified bidders list, qualified manufacturers list, or qualified products list, or (B) has not been identified as meeting a qualification requirement established after October 19, 1984, if the potential offeror can demonstrate to the satisfaction of the contracting officer (or, in the case of a contract for the procurement of an aviation critical safety item or ship critical safety item, the head of the design control activity for such item) that the potential offeror or its product meets the standards established for qualification or can meet such standards before the date specified for award of the contract. (4) Nothing contained in this subsection requires the referral of an offer to the Small Business Administration pursuant to section 8(b)(7) of the Small Business Act (15 U.S.C. 637(b)(7)) if the basis for the referral is a challenge by the offeror to either the validity of the qualification requirement or the offeror's compliance with such requirement. (5) The head of an agency need not delay a proposed procurement in order to comply with subsection (b) or in order to provide a potential offeror with an opportunity to demonstrate its ability to meet the standards specified for qualification. (6) The requirements of subsection (b) also apply before enforcement of any qualified products list, qualified manufacturers list, or qualified bidders list. (d)(1) If the number of qualified sources or qualified products available to compete actively for an anticipated future requirement is fewer than two actual manufacturers or the products of two actual manufacturers, respectively, the head of the agency concerned shall - (A) periodically publish notice in the Commerce Business Daily soliciting additional sources or products to seek qualification, unless the contracting officer determines that such publication would compromise national security; and (B) bear the cost of conducting the specified testing and evaluation (excluding the costs associated with producing the item or establishing the production, quality control, or other system to be tested and evaluated) for a small business concern or a product manufactured by a small business concern which has met the standards specified for qualification and which could reasonably be expected to compete for a contract for that requirement, but such costs may be borne only if the head of the agency determines that such additional qualified sources or products are likely to result in cost savings from increased competition for future requirements sufficient to amortize the costs incurred by the agency within a reasonable period of time considering the duration and dollar value of anticipated future requirements. (2) The head of an agency shall require a prospective contractor requesting the United States to bear testing and evaluation costs under paragraph (1)(B) to certify as to its status as a small business concern under section 3 of the Small Business Act (15 U.S.C. 632). (e) Within seven years after the establishment of a qualification requirement under subsection (b) or within seven years following an agency's enforcement of a qualified products list, qualified manufacturers list, or qualified bidders list, any such qualification requirement shall be examined and revalidated in accordance with the requirements of subsection (b). The preceding sentence does not apply in the case of a qualification requirement for which a waiver is in effect under subsection (c)(2). (f) Except in an emergency as determined by the head of the agency, whenever the head of the agency determines not to enforce a qualification requirement for a solicitation, the agency may not thereafter enforce that qualification requirement unless the agency complies with the requirements of subsection (b). (g) Definitions. - In this section: (1) The term "aviation critical safety item" means a part, an assembly, installation equipment, launch equipment, recovery equipment, or support equipment for an aircraft or aviation weapon system if the part, assembly, or equipment contains a characteristic any failure, malfunction, or absence of which could cause a catastrophic or critical failure resulting in the loss of or serious damage to the aircraft or weapon system, an unacceptable risk of personal injury or loss of life, or an uncommanded engine shutdown that jeopardizes safety. (2) The term "ship critical safety item" means any ship part, assembly, or support equipment containing a characteristic the failure, malfunction, or absence of which could cause a catastrophic or critical failure resulting in loss of or serious damage to the ship or unacceptable risk of personal injury or loss of life. (3) The term "design control activity", with respect to an aviation critical safety item or ship critical safety item, means the systems command of a military department that is specifically responsible for ensuring the airworthiness of an aviation system or equipment, or the seaworthiness of a ship or ship equipment, in which such item is to be used. -SOURCE- (Added Pub. L. 98-525, title XII, Sec. 1216(a), Oct. 19, 1984, 98 Stat. 2593; amended Pub. L. 100-26, Sec. 7(d)(5), (i)(4), (k)(3), Apr. 21, 1987, 101 Stat. 281, 282, 284; Pub. L. 108-136, div. A, title VIII, Sec. 802(d), Nov. 24, 2003, 117 Stat. 1541; Pub. L. 109- 364, div. A, title I, Sec. 130(d), Oct. 17, 2006, 120 Stat. 2110.) -MISC1- AMENDMENTS 2006 - Subsec. (c)(3). Pub. L. 109-364, Sec. 130(d)(1), inserted "or ship critical safety item" after "aviation critical safety item". Subsec. (g)(2), (3). Pub. L. 109-364, Sec. 130(d)(2), added par. (2), redesignated former par. (2) as (3), inserted "or ship critical safety item" after "aviation critical safety item" and ", or the seaworthiness of a ship or ship equipment," after "or equipment", and substituted "such item" for "the item". 2003 - Subsec. (c)(3). Pub. L. 108-136, Sec. 802(d)(1), inserted "(or, in the case of a contract for the procurement of an aviation critical safety item, the head of the design control activity for such item)" after "the contracting officer". Subsec. (g). Pub. L. 108-136, Sec. 802(d)(2), added subsec. (g). 1987 - Subsec. (a). Pub. L. 100-26, Sec. 7(k)(3), inserted "the term" after "In this section,". Subsec. (c)(1), (3). Pub. L. 100-26, Sec. 7(i)(4), substituted "October 19, 1984," for "the date of the enactment of the Defense Procurement Reform Act of 1984". Subsec. (c)(4). Pub. L. 100-26, Sec. 7(d)(5)(A), inserted "(15 U.S.C. 637(b)(7))" after "Small Business Act". Subsec. (d)(2). Pub. L. 100-26, Sec. 7(d)(5)(B), inserted "(15 U.S.C. 632)" after "Small Business Act". EFFECTIVE DATE Section 1216(c)(2) of Pub. L. 98-525 provided that: "Sections 2319, 2320, and 2321 of title 10, United States Code (as added by subsection (a)), shall apply with respect to solicitations issued after the end of the one-year period beginning on the date of the enactment of this Act [Oct. 19, 1984]." -End- -CITE- 10 USC Sec. 2320 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2320. Rights in technical data -STATUTE- (a)(1) The Secretary of Defense shall prescribe regulations to define the legitimate interest of the United States and of a contractor or subcontractor in technical data pertaining to an item or process. Such regulations shall be included in regulations of the Department of Defense prescribed as part of the Federal Acquisition Regulation. Such regulations may not impair any right of the United States or of any contractor or subcontractor with respect to patents or copyrights or any other right in technical data otherwise established by law. Such regulations also may not impair the right of a contractor or subcontractor to receive from a third party a fee or royalty for the use of technical data pertaining to an item or process developed exclusively at private expense by the contractor or subcontractor, except as otherwise specifically provided by law. (2) Such regulations shall include the following provisions: (A) In the case of an item or process that is developed by a contractor or subcontractor exclusively with Federal funds (other than an item or process developed under a contract or subcontract to which regulations under section 9(j)(2) of the Small Business Act (15 U.S.C. 638(j)(2)) apply), the United States shall have the unlimited right to - (i) use technical data pertaining to the item or process; or (ii) release or disclose the technical data to persons outside the government or permit the use of the technical data by such persons. (B) Except as provided in subparagraphs (C) and (D), in the case of an item or process that is developed by a contractor or subcontractor exclusively at private expense, the contractor or subcontractor may restrict the right of the United States to release or disclose technical data pertaining to the item or process to persons outside the government or permit the use of the technical data by such persons. (C) Subparagraph (B) does not apply to technical data that - (i) constitutes a correction or change to data furnished by the United States; (ii) relates to form, fit, or function; (iii) is necessary for operation, maintenance, installation, or training (other than detailed manufacturing or process data); or (iv) is otherwise publicly available or has been released or disclosed by the contractor or subcontractor without restriction on further release or disclosure. (D) Notwithstanding subparagraph (B), the United States may release or disclose technical data to persons outside the Government, or permit the use of technical data by such persons, if - (i) such release, disclosure, or use - (I) is necessary for emergency repair and overhaul; (II) is necessary for the segregation of an item or process from, or the reintegration of that item or process (or a physically or functionally equivalent item or process) with, other items or processes; or (III) is a release or disclosure of technical data (other than detailed manufacturing or process data) to, or use of such data by, a foreign government that is in the interest of the United States and is required for evaluational or informational purposes; (ii) such release, disclosure, or use is made subject to a prohibition that the person to whom the data is released or disclosed may not further release, disclose, or use such data; and (iii) the contractor or subcontractor asserting the restriction is notified of such release, disclosure, or use. (E) In the case of an item or process that is developed in part with Federal funds and in part at private expense, the respective rights of the United States and of the contractor or subcontractor in technical data pertaining to such item or process shall be established as early in the acquisition process as practicable (preferably during contract negotiations). The United States shall have government purpose rights in such technical data, except in any case in which the Secretary of Defense determines, on the basis of criteria established in such regulations, that negotiation of different rights in such technical data would be in the best interest of the United States. The establishment of any such negotiated rights shall be based upon consideration of all of the following factors: (i) The statement of congressional policy and objectives in section 200 of title 35, the statement of purposes in section 2(b) of the Small Business Innovation Development Act of 1982 (15 U.S.C. 638 note), and the declaration of policy in section 2 of the Small Business Act (15 U.S.C. 631). (ii) The interest of the United States in increasing competition and lowering costs by developing and locating alternative sources of supply and manufacture. (iii) The interest of the United States in encouraging contractors to develop at private expense items for use by the Government. (iv) Such other factors as the Secretary of Defense may prescribe. (F) A contractor or subcontractor (or a prospective contractor or subcontractor) may not be required, as a condition of being responsive to a solicitation or as a condition for the award of a contract - (i) to sell or otherwise relinquish to the United States any rights in technical data except - (I) rights in technical data described in subparagraph (A) for which a use or release restriction has been erroneously asserted by a contractor or subcontractor; (II) rights in technical data described in subparagraph (C); or (III) under the conditions described in subparagraph (D); or (ii) to refrain from offering to use, or from using, an item or process to which the contractor is entitled to restrict rights in data under subparagraph (B). (G) The Secretary of Defense may - (i) negotiate and enter into a contract with a contractor or subcontractor for the acquisition of rights in technical data not otherwise provided under subparagraph (C) or (D), if necessary to develop alternative sources of supply and manufacture; (ii) agree to restrict rights in technical data otherwise accorded to the United States under this section if the United States receives a royalty-free license to use, release, or disclose the data for purposes of the United States (including purposes of competitive procurement); or (iii) permit a contractor or subcontractor to license directly to a third party the use of technical data which the contractor is otherwise allowed to restrict, if necessary to develop alternative sources of supply and manufacture. (3) The Secretary of Defense shall define the terms "developed", "exclusively with Federal funds", and "exclusively at private expense" in regulations prescribed under paragraph (1). In defining such terms, the Secretary shall specify the manner in which indirect costs shall be treated and shall specify that amounts spent for independent research and development and bid and proposal costs shall not be considered to be Federal funds for the purposes of the definitions under this paragraph. (b) Regulations prescribed under subsection (a) shall require that, whenever practicable, a contract for supplies or services entered into by an agency named in section 2303 of this title contain appropriate provisions relating to technical data, including provisions - (1) defining the respective rights of the United States and the contractor or subcontractor (at any tier) regarding any technical data to be delivered under the contract and providing that, in the case of a contract for a commercial item, the item shall be presumed to be developed at private expense unless shown otherwise in accordance with section 2321(f); (2) specifying the technical data, if any, to be delivered under the contract and delivery schedules for such delivery; (3) establishing or referencing procedures for determining the acceptability of technical data to be delivered under the contract; (4) establishing separate contract line items for the technical data, if any, to be delivered under the contract; (5) to the maximum practicable extent, identifying, in advance of delivery, technical data which is to be delivered with restrictions on the right of the United States to use such data; (6) requiring the contractor to revise any technical data delivered under the contract to reflect engineering design changes made during the performance of the contract and affecting the form, fit, and function of the items specified in the contract and to deliver such revised technical data to an agency within a time specified in the contract; (7) establishing remedies to be available to the United States when technical data required to be delivered or made available under the contract is found to be incomplete or inadequate or to not satisfy the requirements of the contract concerning technical data; (8) authorizing the head of the agency to withhold payments under the contract (or exercise such other remedies as the head of the agency considers appropriate) during any period if the contractor does not meet the requirements of the contract pertaining to the delivery of technical data; (9) providing that, in addition to technical data that is already subject to a contract delivery requirement, the United States may require at any time the delivery of technical data that has been generated or utilized in the performance of a contract, and compensate the contractor only for reasonable costs incurred for having converted and delivered the data in the required form, upon a determination that - (A) the technical data is needed for the purpose of reprocurement, sustainment, modification, or upgrade (including through competitive means) of a major system or subsystem thereof, a weapon system or subsystem thereof, or any noncommercial item or process; and (B) the technical data - (i) pertains to an item or process developed in whole or in part with Federal funds; or (ii) is necessary for the segregation of an item or process from, or the reintegration of that item or process (or a physically or functionally equivalent item or process) with, other items or processes; and (10) providing that the United States is not foreclosed from requiring the delivery of the technical data by a failure to challenge, in accordance with the requirements of section 2321(d) of this title, the contractor's assertion of a use or release restriction on the technical data. (c) Nothing in this section or in section 2305(d) of this title prohibits the Secretary of Defense from - (1) prescribing standards for determining whether a contract entered into by the Department of Defense shall provide for a time to be specified in the contract after which the United States shall have the right to use (or have used) for any purpose of the United States all technical data required to be delivered to the United States under the contract or providing for such a period of time (not to exceed 7 years) as a negotiation objective; (2) notwithstanding any limitation upon the license rights conveyed under subsection (a), allowing a covered Government support contractor access to and use of any technical data delivered under a contract for the sole purpose of furnishing independent and impartial advice or technical assistance directly to the Government in support of the Government's management and oversight of the program or effort to which such technical data relates; or (3) prescribing reasonable and flexible guidelines, including negotiation objectives, for the conduct of negotiations regarding the respective rights in technical data of the United States and the contractor. (d) The Secretary of Defense shall by regulation establish programs which provide domestic business concerns an opportunity to purchase or borrow replenishment parts from the United States for the purpose of design replication or modification, to be used by such concerns in the submission of subsequent offers to sell the same or like parts to the United States. Nothing in this subsection limits the authority of the head of an agency to impose restrictions on such a program related to national security considerations, inventory needs of the United States, the improbability of future purchases of the same or like parts, or any additional restriction otherwise required by law. (e) The Secretary of Defense shall require program managers for major weapon systems and subsystems of major weapon systems to assess the long-term technical data needs of such systems and subsystems and establish corresponding acquisition strategies that provide for technical data rights needed to sustain such systems and subsystems over their life cycle. Such strategies may include the development of maintenance capabilities within the Department of Defense or competition for contracts for sustainment of such systems or subsystems. Assessments and corresponding acquisition strategies developed under this section with respect to a weapon system or subsystem shall - (1) be developed before issuance of a contract solicitation for the weapon system or subsystem; (2) address the merits of including a priced contract option for the future delivery of technical data that were not acquired upon initial contract award; (3) address the potential for changes in the sustainment plan over the life cycle of the weapon system or subsystem; and (4) apply to weapon systems and subsystems that are to be supported by performance-based logistics arrangements as well as to weapons systems and subsystems that are to be supported by other sustainment approaches. (f) In this section, the term "covered Government support contractor" means a contractor under a contract the primary purpose of which is to furnish independent and impartial advice or technical assistance directly to the Government in support of the Government's management and oversight of a program or effort (rather than to directly furnish an end item or service to accomplish a program or effort), which contractor - (1) is not affiliated with the prime contractor or a first-tier subcontractor on the program or effort, or with any direct competitor of such prime contractor or any such first-tier subcontractor in furnishing end items or services of the type developed or produced on the program or effort; and (2) executes a contract with the Government agreeing to and acknowledging - (A) that proprietary or nonpublic technical data furnished will be accessed and used only for the purposes stated in that contract; (B) that the covered Government support contractor will enter into a non-disclosure agreement with the contractor to whom the rights to the technical data belong; (C) that the covered Government support contractor will take all reasonable steps to protect the proprietary and nonpublic nature of the technical data furnished to the covered Government support contractor during the program or effort for the period of time in which the Government is restricted from disclosing the technical data outside of the Government; (D) that a breach of that contract by the covered Government support contractor with regard to a third party's ownership or rights in such technical data may subject the covered Government support contractor - (i) to criminal, civil, administrative, and contractual actions in law and equity for penalties, damages, and other appropriate remedies by the United States; and (ii) to civil actions for damages and other appropriate remedies by the contractor or subcontractor whose technical data is affected by the breach; and (E) that such technical data provided to the covered Government support contractor under the authority of this section shall not be used by the covered Government support contractor to compete against the third party for Government or non-Government contracts. -SOURCE- (Added Pub. L. 98-525, title XII, Sec. 1216(a), Oct. 19, 1984, 98 Stat. 2595; amended Pub. L. 98-577, title III, Sec. 301(b), Oct. 30, 1984, 98 Stat. 3076; Pub. L. 99-145, title IX, Sec. 961(d)(1), Nov. 8, 1985, 99 Stat. 703; Pub. L. 99-500, Sec. 101(c) [title X, Sec. 953(a)], Oct. 18, 1986, 100 Stat. 1783-82, 1783-169, and Pub. L. 99-591, Sec. 101(c) [title X, Sec. 953(a)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-169; Pub. L. 99-661, div. A, title IX, formerly title IV, Sec. 953(a), Nov. 14, 1986, 100 Stat. 3949, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; Pub. L. 100-26, Sec. 7(a)(4), Apr. 21, 1987, 101 Stat. 275; Pub. L. 100-180, div. A, title VIII, Sec. 808(a), (b), Dec. 4, 1987, 101 Stat. 1128, 1130; Pub. L. 101-189, div. A, title VIII, Sec. 853(b)(2), Nov. 29, 1989, 103 Stat. 1518; Pub. L. 103-355, title VIII, Sec. 8106(a), Oct. 13, 1994, 108 Stat. 3393; Pub. L. 108-136, div. A, title VIII, Sec. 844, Nov. 24, 2003, 117 Stat. 1553; Pub. L. 109-364, div. A, title VIII, Sec. 802(a), Oct. 17, 2006, 120 Stat. 2312; Pub. L. 111-84, div. A, title VIII, Sec. 821, Oct. 28, 2009, 123 Stat. 2411; Pub. L. 111-383, div. A, title VIII, Secs. 801(a), 824(b), Jan. 7, 2011, 124 Stat. 4253, 4269; Pub. L. 112-81, div. A, title VIII, Secs. 802(b), 815(a), Dec. 31, 2011, 125 Stat. 1485, 1491.) -COD- CODIFICATION Pub. L. 99-591 is a corrected version of Pub. L. 99-500. -MISC1- AMENDMENTS 2011 - Subsec. (a)(2)(D)(i)(II), (III). Pub. L. 112-81, Sec. 815(a)(1)(A), added subcl. (II) and redesignated former subcl. (II) as (III). Subsec. (a)(2)(E). Pub. L. 112-81, Sec. 815(a)(1)(B), substituted ". The United States shall have government purpose rights in such technical data, except in any case in which the Secretary of Defense determines, on the basis of criteria established in such regulations, that negotiation of different rights in such technical data would be in the best interest of the United States. The establishment of any such negotiated rights shall" for "and shall be based upon negotiations between the United States and the contractor, except in any case in which the Secretary of Defense determines, on the basis of criteria established in the regulations, that negotiations would not be practicable. The establishment of such rights shall". Subsec. (a)(2)(F)(i). Pub. L. 111-383, Sec. 824(b)(1), added subcl. (I) and redesignated former subcls. (I) and (II) as (II) and (III), respectively. Subsec. (a)(3). Pub. L. 112-81, Sec. 815(a)(1)(C), substituted "for the purposes of the definitions under this paragraph" for "for the purposes of paragraph (2)(B), but shall be considered to be Federal funds for the purposes of paragraph (2)(A)". Pub. L. 111-383, Sec. 824(b)(2), substituted "for the purposes of paragraph (2)(B), but shall be considered to be Federal funds for the purposes of paragraph (2)(A)" for "for the purposes of definitions under this paragraph". Subsec. (b)(9), (10). Pub. L. 112-81, Sec. 815(a)(2), added pars. (9) and (10). Subsec. (c)(2). Pub. L. 112-81, Sec. 802(b)(1), substituted "subsection (a)," for "subsection (a) - ", struck out "(A)" before "allowing", and struck out subpar. (B) which read as follows: "allowing a covered litigation support contractor access to and use of any technical, proprietary, or confidential data delivered under a contract for the sole purpose of providing litigation support to the Government in the form of administrative, technical, or professional services during or in anticipation of litigation; or". Pub. L. 111-383, Sec. 801(a)(1), substituted "subsection (a) - " for "subsection (a),", inserted "(A)" before "allowing", and added subpar. (B). Subsec. (g). Pub. L. 112-81, Sec. 802(b)(2), struck out subsec. (g) which defined "covered litigation support contractor" for purpose of this section. Pub. L. 111-383, Sec. 801(a)(2), added subsec. (g). 2009 - Subsec. (c)(2), (3). Pub. L. 111-84, Sec. 821(a), added par. (2) and redesignated former par. (2) as (3). Subsec. (f). Pub. L. 111-84, Sec. 821(b), added subsec. (f). 2006 - Subsec. (e). Pub. L. 109-364 added subsec. (e). 2003 - Subsec. (b)(7) to (9). Pub. L. 108-136 redesignated pars. (8) and (9) as (7) and (8), respectively, and struck out former par. (7) which read as follows: "requiring the contractor to furnish written assurance at the time the technical data is delivered or is made available that the technical data is complete and accurate and satisfies the requirements of the contract concerning technical data;". 1994 - Subsec. (b)(1). Pub. L. 103-355 inserted before semicolon at end "and providing that, in the case of a contract for a commercial item, the item shall be presumed to be developed at private expense unless shown otherwise in accordance with section 2321(f)". 1989 - Subsec. (a)(4). Pub. L. 101-189 struck out par. (4) which provided that for purposes of this subsection, the term "Federal Acquisition Regulation" means the single system of Government-wide procurement regulations as defined in section 4(4) of the Office of Federal Procurement Policy Act (41 U.S.C. 403(4)). 1987 - Subsec. (a)(1). Pub. L. 100-180, Sec. 808(a)(1), inserted at end "Such regulations also may not impair the right of a contractor or subcontractor to receive from a third party a fee or royalty for the use of technical data pertaining to an item or process developed exclusively at private expense by the contractor or subcontractor, except as otherwise specifically provided by law." Subsec. (a)(2)(A). Pub. L. 100-26, Sec. 7(a)(4)(A), inserted "(other than an item or process developed under a contract or subcontract to which regulations under section 9(j)(2) of the Small Business Act (15 U.S.C. 638(j)(2)) apply)" after "Federal funds". Subsec. (a)(2)(E). Pub. L. 100-180, Sec. 808(a)(2), in introductory provisions, substituted "established" for "agreed upon", struck out comma after "negotiations)" and inserted in lieu "and shall be based upon negotiations between the United States and the contractor, except in any case in which the Secretary of Defense determines, on the basis of criteria established in the regulations, that negotiations would not be practicable. The establishment of such rights shall be", and added cl. (iv). Subsec. (a)(2)(F). Pub. L. 100-180, Sec. 808(a)(3), amended subpar. (F) generally. Prior to amendment, subpar. (F) read as follows: "A contractor or subcontractor (or a prospective contractor or subcontractor) may not be required, as a condition of being responsive to a solicitation or as a condition for the award of a contract, to sell or otherwise relinquish to the United States any rights in technical data except - "(i) rights in technical data described in subparagraph (C); or "(ii) under the conditions described in subparagraph (D)." Subsec. (a)(2)(G)(i). Pub. L. 100-180, Sec. 808(a)(4)(A), substituted "not otherwise provided under subparagraph (C) or (D)," for "pertaining to an item or process developed by such contractor or subcontractor exclusively at private expense" and struck out "or" at end. Subsec. (a)(2)(G)(ii). Pub. L. 100-180, Sec. 808(a)(4)(B), substituted "this section" for "such regulations" and "; or" for period at end. Pub. L. 100-26, Sec. 7(a)(4)(B), substituted "in technical data otherwise accorded to the United States under such regulations" for "of the United States in technical data pertaining to an item or process developed entirely or in part with Federal funds". Subsec. (a)(2)(G)(iii). Pub. L. 100-180, Sec. 808(a)(4)(C), added cl. (iii). Subsec. (a)(3). Pub. L. 100-180, Sec. 808(a)(5), substituted ", 'exclusively with Federal funds', and 'exclusively at private expense' " for "and 'private expense' " and inserted at end "In defining such terms, the Secretary shall specify the manner in which indirect costs shall be treated and shall specify that amounts spent for independent research and development and bid and proposal costs shall not be considered to be Federal funds for the purposes of definitions under this paragraph." Subsec. (c). Pub. L. 100-180, Sec. 808(b), substituted "from - " for "from", designated existing provisions beginning with "prescribing standards" as par. (1), and added par. (2). 1986 - Subsec. (a). Pub. L. 99-500, Pub. L. 99-591, and Pub. L. 99-661 amended generally subsec. (a) substantially identically, substituting provision that regulations to define the legitimate interest of the United States and of a contractor or subcontractor in technical data be included in regulations of the Department of Defense prescribed as part of the Federal Acquisition Regulation for provision that such regulations define the legitimate proprietary interest of the United States and a contractor and be part of the single system of Government-wide procurement regulations, detailed what such regulations must contain if the item or process is developed exclusively with Federal funds, exclusively with private funds, or partly with Federal funds and partly with private funds, inserted provision relating to relinquishment of rights in data to the United States, directed the Secretary of Defense to define "developed" and "private expense", and defined "Federal Acquisition Regulation". Text reflects amendment by Pub. L. 99-661, which was executed last. 1985 - Subsec. (a)(1). Pub. L. 99-145 substituted "the item or process to which the technical data pertains" for "the technical data". 1984 - Subsec. (a). Pub. L. 98-577 substituted "in regulations of the Department of Defense prescribed as part" for "in regulations prescribed as part" in text preceding par. (1). EFFECTIVE DATE OF 2011 AMENDMENT Pub. L. 112-81, div. A, title VIII, Sec. 815(c), Dec. 31, 2011, 125 Stat. 1493, provided that: "(1) In general. - Except as provided in paragraph (2), the amendments made by this section [amending this section and section 2321 of this title] shall take effect on the date of the enactment of this Act [Dec. 31, 2011]. "(2) Exception. - The amendment made by subsection (a)(1)(C) [amending this section] shall take effect on January 7, 2011, immediately after the enactment of the Ike Skelton National Defense Authorization Act for Fiscal Year 2011 (Public Law 111-383), to which such amendment relates." Pub. L. 111-383, div. A, title VIII, Sec. 801(b), Jan. 7, 2011, 124 Stat. 4254, provided that: "The amendments made by subsection (a) [amending this section] shall take effect on the date that is 120 days after the date of the enactment of this Act [Jan. 7, 2011]." EFFECTIVE DATE OF 1994 AMENDMENT For effective date and applicability of amendment by Pub. L. 103- 355, see section 10001 of Pub. L. 103-355, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1987 AMENDMENT Section 808(c) of Pub. L. 100-180 provided that: "The amendments made by this section [amending this section] shall take effect on the earlier of - "(1) the last day of the 120-day period beginning on the date of the enactment of this Act [Dec. 4, 1987]; or "(2) the date on which regulations are prescribed and made effective to implement such amendments." EFFECTIVE DATE OF 1986 AMENDMENT Section 101(c) [title X, Sec. 953(e)] of Pub. L. 99-500 and Pub. L. 99-591, and section 953(e) of title IX, formerly title IV, of Pub. L. 99-661, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, provided that: "The amendments made by subsections (a) and (b) [amending this section and section 2321 of this title] shall apply to contracts for which solicitations are issued after the end of the 210-day period beginning on the date of the enactment of this Act [Oct. 18, 1986]." EFFECTIVE DATE Section applicable with respect to solicitations issued after the end of the one-year period beginning Oct. 19, 1984, see section 1216(c)(2) of Pub. L. 98-525, set out as a note under section 2319 of this title. REGULATIONS Pub. L. 109-364, div. A, title VIII, Sec. 802(c), Oct. 17, 2006, 120 Stat. 2313, provided that: "Not later than 180 days after the date of the enactment of this Act [Oct. 17, 2006], the Secretary of Defense shall revise regulations under section 2320 of title 10, United States Code, to implement subsection (e) of such section (as added by this section), including incorporating policy changes developed under such subsection into Department of Defense Directive 5000.1 and Department of Defense Instruction 5000.2." Section 101(c) [title X, Sec. 953(d)] of Pub. L. 99-500 and Pub. L. 99-591, and section 953(d) of title IX, formerly title IV, of Pub. L. 99-661, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, required that proposed regulations under subsec. (a)(1) of this section be published in Federal Register for comment not later than 90 days after Oct. 18, 1986, and that proposed final regulations be published in Federal Register not later than 180 days after Oct. 18, 1986. GUIDANCE RELATING TO RIGHTS IN TECHNICAL DATA Pub. L. 111-383, div. A, title VIII, Sec. 824(a), Jan. 7, 2011, 124 Stat. 4269, provided that: "Not later than 180 days after the date of the enactment of this Act [Jan. 7, 2011], the Secretary of Defense shall review guidance issued by the military departments on the implementation of section 2320(e) of title 10, United States Code, to ensure that such guidance is consistent with the guidance issued by the Under Secretary of Defense for Acquisition, Technology, and Logistics and the requirements of this section [amending this section and section 2321 of this title]. Such guidance shall be designed to ensure that the United States - "(1) preserves the option of competition for contracts for the production and sustainment of systems or subsystems that are developed exclusively with Federal funds as defined in accordance with the amendments made by this section; and "(2) is not required to pay more than once for the same technical data." TECHNICAL DATA RIGHTS UNDER NON-FAR AGREEMENTS Pub. L. 110-417, [div. A], title VIII, Sec. 822, Oct. 14, 2008, 122 Stat. 4532, as amended by Pub. L. 111-383, div. A, title X, Sec. 1075(e)(13), Jan. 7, 2011, 124 Stat. 4375, provided that: "(a) Policy Guidance. - Not later than 270 days after the date of the enactment of this Act [Oct. 14, 2008], the Secretary of Defense shall issue policy guidance with respect to rights in technical data under a non-FAR agreement. The guidance shall - "(1) establish criteria for defining the legitimate interests of the United States and the party concerned in technical data pertaining to an item or process to be developed under the agreement; "(2) require that specific rights in technical data be established during agreement negotiations and be based upon negotiations between the United States and the potential party to the agreement, except in any case in which the Secretary of Defense determines, on the basis of criteria established in such policy guidance, that the establishment of rights during or through agreement negotiations would not be practicable; and "(3) require the program manager for a major weapon system or an item of personnel protective equipment that is to be developed using a non-FAR agreement to assess the long-term technical data needs of such system or item. "(b) Requirement to Include Provisions in Non-FAR Agreements. - A non-FAR agreement shall contain appropriate provisions relating to rights in technical data consistent with the policy guidance issued pursuant to subsection (a). "(c) Definitions. - In this section: "(1) The term 'non-FAR agreement' means an agreement that is not subject to laws pursuant to which the Federal Acquisition Regulation is prescribed, including - "(A) a transaction authorized under section 2371 of title 10, United States Code; and "(B) a cooperative research and development agreement. "(2) The term 'party', with respect to a non-FAR agreement, means a non-Federal entity and includes any of the following: "(A) A contractor and its subcontractors (at any tier). "(B) A joint venture. "(C) A consortium. "(d) Report on Life Cycle Planning for Technical Data Needs. - Not later than 270 days after the date of enactment of this Act [Oct. 14, 2008], the Secretary of Defense shall submit to the Committees on Armed Services of the Senate and the House of Representatives a report on the implementation of the requirements in section 2320(e) of title 10, United States Code, for the assessment of long-term technical data needs to sustain major weapon systems. Such report shall include - "(1) a description of all relevant guidance or policies issued; "(2) a description of the extent to which program managers have received training to better assess the long-term technical data needs of major weapon systems and subsystems; and "(3) a description of one or more examples, if any, where a priced contract option has been used on major weapon systems for the future delivery of technical data and one or more examples, if any, where all relevant technical data were acquired upon contract award." GOVERNMENT-INDUSTRY COMMITTEE ON RIGHTS IN TECHNICAL DATA Pub. L. 102-190, div. A, title VIII, Sec. 807, Dec. 5, 1991, 105 Stat. 1421, as amended by Pub. L. 102-484, div. A, title VIII, Sec. 814, Oct. 23, 1992, 106 Stat. 2454; Pub. L. 105-85, div. A, title X, Sec. 1073(d)(3), Nov. 18, 1997, 111 Stat. 1905, provided that not later than Sept. 15, 1992, the Secretary of Defense was to prescribe final regulations required by subsec. (a) of this section that supersede the interim regulations prescribed before Dec. 5, 1991, for the purposes of this section and contained various provisions relating to a government-industry advisory committee, reports to Congress, publication of the regulations, and application of the regulations. CONTROL OF GOVERNMENT PERSONNEL WORK PRODUCT Pub. L. 102-190, div. A, title VIII, Sec. 808, Dec. 5, 1991, 105 Stat. 1423, required Secretary of Defense to prescribe regulations ensuring that any Department of Defense employee or member of the armed forces with an appropriate security clearance who is engaged in oversight of an acquisition program maintains control of the employee's or member's work product, provided that procedures for protecting unauthorized disclosure of classified information by contractors do not require such an employee or member to relinquish control of his or her work product to any such contractor, required implementing regulations not later than 120 days after Dec. 5, 1991, and provided that this section would cease to be effective on Sept. 30, 1992. -End- -CITE- 10 USC Sec. 2321 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2321. Validation of proprietary data restrictions -STATUTE- (a) Contracts Covered by Section. - This section applies to any contract for supplies or services entered into by the Department of Defense that includes provisions for the delivery of technical data. (b) Contractor Justification for Restrictions. - A contract subject to this section shall provide that a contractor under the contract and any subcontractor under the contract at any tier shall be prepared to furnish to the contracting officer a written justification for any use or release restriction (as defined in subsection (i)) asserted by the contractor or subcontractor. (c) Review of Restrictions. - (1) The Secretary of Defense shall ensure that there is a thorough review of the appropriateness of any use or release restriction asserted with respect to technical data by a contractor or subcontractor at any tier under a contract subject to this section. (2) The review of an asserted use or release restriction under paragraph (1) shall be conducted before the end of the three-year period beginning on the later of - (A) the date on which final payment is made on the contract under which the technical data is required to be delivered; or (B) the date on which the technical data is delivered under the contract. (d) Challenges to Restrictions. - (1) The Secretary of Defense may challenge a use or release restriction asserted with respect to technical data by a contractor or subcontractor at any tier under a contract subject to this section if the Secretary finds that - (A) reasonable grounds exist to question the current validity of the asserted restriction; and (B) the continued adherence by the United States to the asserted restriction would make it impracticable to procure the item to which the technical data pertain competitively at a later time. (2)(A) A challenge to a use or release restriction asserted by the contractor in accordance with applicable regulations may not be made under paragraph (1) after the end of the six-year period described in subparagraph (B) unless the technical data involved - (i) are publicly available; (ii) have been furnished to the United States without restriction; (iii) have been otherwise made available without restriction; or (iv) are the subject of a fraudulently asserted use or release restriction. (B) The six-year period referred to in subparagraph (A) is the six-year period beginning on the later of - (i) the date on which final payment is made on the contract under which the technical data are required to be delivered; or (ii) the date on which the technical data are delivered under the contract. (3) If the Secretary challenges an asserted use or release restriction under paragraph (1), the Secretary shall provide written notice of the challenge to the contractor or subcontractor asserting the restriction. Any such notice shall - (A) state the specific grounds for challenging the asserted restriction; (B) require a response within 60 days justifying the current validity of the asserted restriction; and (C) state that evidence of a justification described in paragraph (4) may be submitted. (4) It is a justification of an asserted use or release restriction challenged under paragraph (1) that, within the three- year period preceding the challenge to the restriction, the Department of Defense validated a restriction identical to the asserted restriction if - (A) such validation occurred after a challenge to the validated restriction under this subsection; and (B) the validated restriction was asserted by the same contractor or subcontractor (or a licensee of such contractor or subcontractor). (e) Time for Contractors to Submit Justifications. - If a contractor or subcontractor asserting a use or release restriction submits to the contracting officer a written request, showing the need for additional time to comply with the requirement to justify the current validity of the asserted restriction, additional time to adequately permit the submission of such justification shall be provided by the contracting officer as appropriate. If a party asserting a restriction receives notices of challenges to restrictions on technical data from more than one contracting officer, and notifies each contracting officer of the existence of more than one challenge, the contracting officer initiating the first in time challenge, after consultation with the party asserting the restriction and the other contracting officers, shall formulate a schedule of responses to each of the challenges that will afford the party asserting the restriction with an equitable opportunity to respond to each such challenge. (f) Presumption of Development Exclusively at Private Expense. - (1) Except as provided in paragraph (2), in the case of a challenge to a use or release restriction that is asserted with respect to technical data of a contractor or subcontractor under a contract for commercial items, the contracting officer shall presume that the contractor or subcontractor has justified the restriction on the basis that the item was developed exclusively at private expense, whether or not the contractor or subcontractor submits a justification in response to the notice provided pursuant to subsection (d)(3). In such a case, the challenge to the use or release restriction may be sustained only if information provided by the Department of Defense demonstrates that the item was not developed exclusively at private expense. (2) In the case of a challenge to a use or release restriction that is asserted with respect to technical data of a contractor or subcontractor (other than technical data for a commercially available off-the-shelf item as defined in section 35(c) (!1) of the Office of Federal Procurement Policy Act (41 U.S.C. 431(c))) for a major system or a subsystem or component thereof on the basis that the major system, subsystem or component was developed exclusively at private expense, the challenge to the use or release restriction shall be sustained unless information provided by the contractor or subcontractor demonstrates that the item was developed exclusively at private expense. (g) Decision by Contracting Officer. - (1) Upon a failure by the contractor or subcontractor to submit any response under subsection (d)(3), the contracting officer shall issue a decision pertaining to the validity of the asserted restriction. (2) After review of any justification submitted in response to the notice provided pursuant to subsection (d)(3), the contracting officer shall, within 60 days of receipt of any justification submitted, issue a decision or notify the party asserting the restriction of the time within which a decision will be issued. (h) Claims. - If a claim pertaining to the validity of the asserted restriction is submitted in writing to a contracting officer by a contractor or subcontractor at any tier, such claim shall be considered a claim within the meaning of chapter 71 of title 41. (i) Rights and Liability Upon Final Disposition. - (1) If, upon final disposition, the contracting officer's challenge to the use or release restriction is sustained - (A) the restriction shall be cancelled; and (B) if the asserted restriction is found not to be substantially justified, the contractor or subcontractor asserting the restriction shall be liable to the United States for payment of the cost to the United States of reviewing the asserted restriction and the fees and other expenses (as defined in section 2412(d)(2)(A) of title 28) incurred by the United States in challenging the asserted restriction, unless special circumstances would make such payment unjust. (2) If, upon final disposition, the contracting officer's challenge to the use or release restriction is not sustained - (A) the United States shall continue to be bound by the restriction; and (B) the United States shall be liable for payment to the party asserting the restriction for fees and other expenses (as defined in section 2412(d)(2)(A) of title 28) incurred by the party asserting the restriction in defending the asserted restriction if the challenge by the United States is found not to be made in good faith. (j) Use or Release Restriction Defined. - In this section, the term "use or release restriction", with respect to technical data delivered to the United States under a contract subject to this section, means a restriction by the contractor or subcontractor on the right of the United States - (1) to use such technical data; or (2) to release or disclose such technical data to persons outside the Government or permit the use of such technical data by persons outside the Government. -SOURCE- (Added Pub. L. 98-525, title XII, Sec. 1216(a), Oct. 19, 1984, 98 Stat. 2597; amended Pub. L. 99-500 Sec. 101(c) [title X, Sec. 953(b)], Oct. 18, 1986, 100 Stat. 1783-82, 1783-171, and Pub. L. 99- 591, Sec. 101(c) [title X, Sec. 953(b)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-171; Pub. L. 99-661, div. A, title IX, formerly title IV, Sec. 953(b), Nov. 14, 1986, 100 Stat. 3951, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, Pub. L. 100-26, Sec. 7(a)(5), Apr. 21, 1987, 101 Stat. 276; Pub. L. 100- 180, div. A, title XII, Sec. 1231(6), Dec. 4, 1987, 101 Stat. 1160; Pub. L. 103-35, title II, Sec. 201(g)(4), May 31, 1993, 107 Stat. 100; Pub. L. 103-355, title VIII, Sec. 8106(b), Oct. 13, 1994, 108 Stat. 3393; Pub. L. 109-364, div. A, title VIII, Sec. 802(b), Oct. 17, 2006, 120 Stat. 2313; Pub. L. 110-181, div. A, title VIII, Sec. 815(a)(2), Jan. 28, 2008, 122 Stat. 223; Pub. L. 111-350, Sec. 5(b)(18), Jan. 4, 2011, 124 Stat. 3844; Pub. L. 111- 383, div. A, title VIII, Sec. 824(c), Jan. 7, 2011, 124 Stat. 4269; Pub. L. 112-81, div. A, title VIII, Sec. 815(b), Dec. 31, 2011, 125 Stat. 1492.) -REFTEXT- REFERENCES IN TEXT Section 35(c) of the Office of Federal Procurement Policy Act, referred to in subsec. (f)(2), means section 35(c) of Pub. L. 93- 400, which was classified to section 431(c) of former Title 41, Public Contracts, and was repealed and restated as section 104 of Title 41, Public Contracts, by Pub. L. 111-350, Secs. 3, 7(b), Jan. 4, 2011, 124 Stat. 3677, 3855. -COD- CODIFICATION Pub. L. 99-591 is a corrected version of Pub. L. 99-500. Another section 2321 of this title was contained in chapter 138 and was renumbered section 2341 of this title. -MISC1- AMENDMENTS 2011 - Subsec. (d)(2)(A). Pub. L. 112-81, Sec. 815(b)(1)(A), substituted "A challenge to a use or release restriction asserted by the contractor in accordance with applicable regulations may not be made under paragraph (1) after the end of the six-year period" for "Except as provided in subparagraph (C), a challenge to an asserted use or release restriction may not be made under paragraph (1) after the end of the three-year period" in introductory provisions. Pub. L. 111-383, Sec. 824(c)(1), substituted "Except as provided in subparagraph (C), a challenge" for "A challenge" in introductory provisions. Subsec. (d)(2)(A)(iv). Pub. L. 112-81, Sec. 815(b)(1)(B)-(D), added cl. (iv). Subsec. (d)(2)(B). Pub. L. 112-81, Sec. 815(b)(2), substituted "six-year period" for "three-year period" in two places in introductory provisions. Subsec. (d)(2)(C). Pub. L. 112-81, Sec. 815(b)(3), struck out subpar. (C) which read as follows: "The limitation in this paragraph shall not apply to a case in which the Secretary finds that reasonable grounds exist to believe that a contractor or subcontractor has erroneously asserted a use or release restriction with regard to technical data described in section 2320(a)(2)(A) of this title." Pub. L. 111-383, Sec. 824(c)(2), added subpar. (C). Subsec. (h). Pub. L. 111-350 substituted "chapter 71 of title 41" for "the Contract Disputes Act of 1978 (41 U.S.C. 601 et seq.)". 2008 - Subsec. (f)(2). Pub. L. 110-181 substituted "(other than technical data for a commercially available off-the-shelf item as defined in section 35(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 431(c)))" for "(whether or not under a contract for commercial items)". 2006 - Subsec. (f). Pub. L. 109-364 substituted "Expense" for "Expense for Commercial Items Contracts" in heading, designated existing provisions as par. (1), substituted "Except as provided in paragraph (2), in" for "In", and added par. (2). 1994 - Subsecs. (f) to (j). Pub. L. 103-355 added subsec. (f) and redesignated former subsecs. (f) to (i) as (g) to (j), respectively. 1993 - Subsec. (d)(1)(B). Pub. L. 103-35 substituted "adherence" for "adherance". 1987 - Subsec. (a). Pub. L. 100-26, Sec. 7(a)(5)(A)(ii), added subsec. (a) and struck out former subsec. (a) which read as follows: "A contract for supplies or services entered into by the Department of Defense which provides for the delivery of technical data shall provide that a contractor or subcontractor at any tier shall be prepared to furnish to the contracting officer a written justification for any restriction asserted by the contractor or subcontractor on the right of the United States to use such technical data." Subsec. (b). Pub. L. 100-26, Sec. 7(a)(5)(A)(ii), added subsec. (b) and struck out former subsec. (b) which read as follows: "(1) The Secretary of Defense shall ensure that there is a thorough review of the appropriateness of any restriction on the right of the United States to release or disclose technical data delivered under a contract to persons outside the Government, or to permit the use of such technical data by such persons. Such review shall be conducted before the end of the three-year period beginning on the date on which final payment is made on a contract under which technical data is required to be delivered, or the date on which the technical data is delivered under such contract, whichever is later. "(2)(A) If the Secretary determines, at any time before the end of the three-year period beginning on the date on which final payment is made on a contract under which technical data is required to be delivered, or the date on which the technical data is delivered under such contract, whichever is later, that a challenge to a restriction is warranted, the Secretary shall provide written notice to the contractor or subcontractor asserting the restriction. Such a determination shall be based on a finding by the Secretary that reasonable grounds exist to question the current validity of the asserted restriction and that the continued adherence to the asserted restriction by the United States would make it impracticable to procure the item competitively at a later time. Such notice shall - "(i) state the specific grounds for challenging the asserted restriction; "(ii) require a response within 60 days justifying the current validity of the asserted restriction; and "(iii) state that evidence of a validation by the Department of Defense of a restriction identical to the asserted restriction within the three-year period preceding the challenge shall serve as justification for the asserted restriction if - "(I) the validation occurred after a review of the validated restriction under this subsection; and "(II) the validated restriction was asserted by the same contractor or subcontractor (or any licensee of such contractor or subcontractor) to which such notice is being provided. "(B) Notwithstanding subparagraph (A), the United States may challenge a restriction on the release, disclosure, or use of technical data delivered under a contract at any time if such technical data - "(i) is publicly available; "(ii) has been furnished to the United States without restriction; or "(iii) has been otherwise made available without restriction." Subsec. (c). Pub. L. 100-26, Sec. 7(a)(5)(A)(ii), added subsec. (c). Former subsec. (c) redesignated (e). Subsec. (d). Pub. L. 100-26, Sec. 7(a)(5)(A)(ii), added subsec. (d). Former subsec. (d) redesignated (f). Subsec. (d)(4)(A). Pub. L. 99-180, Sec. 1231(6)(A), substituted "subsection" for "paragraph". Subsec. (e). Pub. L. 100-26, Sec. 7(a)(5)(A)(i), (B), redesignated former subsec. (c) as (e), inserted heading, and substituted "If a contractor or subcontractor asserting a use or release restriction" for "If a contractor or subcontractor asserting a restriction subject to this section". Former subsec. (e) redesignated (g). Subsec. (f). Pub. L. 100-26, Sec. 7(a)(5)(A)(i), (C), redesignated former subsec. (d) as (f), inserted heading, and substituted "subsection (d)(3)" for "subsection (b)" in two places. Former subsec. (f) redesignated (h). Subsec. (g). Pub. L. 100-26, Sec. 7(a)(5)(A)(i), (D), redesignated former subsec. (e) as (g) and inserted heading. Subsec. (h). Pub. L. 100-26, Sec. 7(a)(5)(A)(i), (E)(i), redesignated former subsec. (f) as (h) and inserted heading. Subsec. (h)(1). Pub. L. 100-26, Sec. 7(a)(5)(E)(ii)-(iv), substituted "the use or release restriction" for "the restriction on the right of the United States to use such technical data" in introductory provisions, struck out "on the right of the United States to use the technical data" after "the restriction" in subpar. (A), and substituted "asserting the restriction" for ", as appropriate," in subpar. (B). Subsec. (h)(2). Pub. L. 100-26, Sec. 7(a)(5)(E)(v), substituted "the use or release restriction" for "the restriction on the right of the United States to use such technical data" in introductory provisions. Subsec. (i). Pub. L. 100-180, Sec. 1231(6)(B), inserted "or subcontractor" in introductory provisions. Pub. L. 100-26, Sec. 7(a)(5)(F), added subsec. (i). 1986 - Subsecs. (a), (b). Pub. L. 99-500, Pub. L. 99-591, and Pub. L. 99-661 amended generally subsecs. (a) and (b) identically. Prior to amendment, subsecs. (a) and (b) read as follows: "(a) A contract for supplies or services entered into by the Department of Defense which provides for the delivery of technical data shall provide that - "(1) a contractor or subcontractor at any tier shall be prepared to furnish to the contracting officer a written justification for any restriction asserted by the contractor or subcontractor on the right of the United States to use such technical data; and "(2) the contracting officer may review the validity of any restriction asserted by the contractor or by a subcontractor under the contract on the right of the United States to use technical data furnished to the United States under the contract if the contracting officer determines that reasonable grounds exist to question the current validity of the asserted restriction and that the continued adherence to the asserted restriction by the United States would make it impracticable to procure the item competitively at a later time. "(b) If after such review the contracting officer determines that a challenge to the asserted restriction is warranted, the contracting officer shall provide written notice to the contractor or subcontractor asserting the restriction. Such notice shall - "(1) state the grounds for challenging the asserted restriction; and "(2) require a response within 60 days justifying the current validity of the asserted restriction." EFFECTIVE DATE OF 1994 AMENDMENT For effective date and applicability of amendment by Pub. L. 103- 355, see section 10001 of Pub. L. 103-355, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1987 AMENDMENT Section 12(d)(1) of Pub. L. 100-26 provided that: "The amendments to section 2321 of title 10, United States Code, made by section 7(a)(5) shall apply to contracts for which solicitations are issued after the end of the 210-day period beginning on October 18, 1986." EFFECTIVE DATE OF 1986 AMENDMENT Amendment by Pub. L. 99-500, Pub. L. 99-591, and Pub. L. 99-661 applicable to contracts for which solicitations are issued after end of 210-day period beginning Oct. 18, 1986, see section 101(c) of Pub. L. 99-500 and Pub. L. 99-591, and section 953(e) of Pub. L. 99-661, set out as a note under section 2320 of this title. EFFECTIVE DATE Section applicable with respect to solicitations issued after the end of the one-year period beginning Oct. 19, 1984, see section 1216(c)(2) of Pub. L. 98-525, set out as a note under section 2319 of this title. -FOOTNOTE- (!1) See References in Text note below. -End- -CITE- 10 USC Sec. 2322 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2322. Repealed. -MISC1- [Sec. 2322. Repealed. Pub. L. 102-484, div. A, title X, Sec. 1052(25)(A), Oct. 23, 1992, 106 Stat. 2500]. Section, added Pub. L. 98-525, title XII, Sec. 1216(a), Oct. 19, 1984, 98 Stat. 2598; amended Pub. L. 100-26, Sec. 7(a)(6), Apr. 21, 1987, 101 Stat. 278; Pub. L. 100-180, div. A, title XII, Sec. 1231(7), Dec. 4, 1987, 101 Stat. 1160, limited small business set- asides under the Foreign Military Sales Program and provided that the section expired Jan. 17, 1987. Another section 2322 of this title was contained in chapter 138 and was renumbered section 2342 of this title. -End- -CITE- 10 USC Sec. 2323 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2323. Contract goal for small disadvantaged businesses and certain institutions of higher education -STATUTE- (a) Goal. - (1) Except as provided in subsection (d), a goal of 5 percent of the amount described in subsection (b) shall be the objective of the Department of Defense, the Coast Guard, and the National Aeronautics and Space Administration in each fiscal year for the total combined amount obligated for contracts and subcontracts entered into with - (A) small business concerns, including mass media and advertising firms, owned and controlled by socially and economically disadvantaged individuals (as such term is used in section 8(d) of the Small Business Act (15 U.S.C. 637(d)) and regulations issued under that section), the majority of the earnings of which directly accrue to such individuals, and qualified HUBZone small business concerns (as defined in section 3(p) of the Small Business Act); (B) historically Black colleges and universities, including any nonprofit research institution that was an integral part of such a college or university before November 14, 1986; (C) minority institutions (as defined in section 365(3) of the Higher Education Act of 1965 (20 U.S.C. 1067k)); (D) Hispanic-serving institutions (as defined in section 502(a) of the Higher Education Act of 1965 (20 U.S.C. 1101a(a))); and (E) Native Hawaiian-serving institutions and Alaska Native- serving institutions (as defined in section 317 of the Higher Education Act of 1965). (2) The head of the agency shall establish a specific goal within the overall 5 percent goal for the award of prime contracts and subcontracts to historically Black colleges and universities, Hispanic-serving institutions, Native Hawaiian-serving institutions and Alaska Native-serving institutions, and minority institutions in order to increase the participation of such colleges and universities and institutions in the program provided for by this section. (3) The Federal Acquisition Regulation shall provide procedures or guidelines for contracting officers to set goals which agency prime contractors that are required to submit subcontracting plans under section 8(d)(4)(B) of the Small Business Act (15 U.S.C. 637(d)(4)(B)) in furtherance of the agency's program to meet the 5 percent goal specified in paragraph (1) should meet in awarding subcontracts, including subcontracts to minority-owned media, to entities described in that paragraph. (b) Amount. - (1) With respect to the Department of Defense, the requirements of subsection (a) for any fiscal year apply to the combined total of the following amounts: (A) Funds obligated for contracts entered into with the Department of Defense for such fiscal year for procurement. (B) Funds obligated for contracts entered into with the Department of Defense for such fiscal year for research, development, test, and evaluation. (C) Funds obligated for contracts entered into with the Department of Defense for such fiscal year for military construction. (D) Funds obligated for contracts entered into with the Department of Defense for operation and maintenance. (2) With respect to the Coast Guard, the requirements of subsection (a) for any fiscal year apply to the total value of all prime contract and subcontract awards entered into by the Coast Guard for such fiscal year. (3) With respect to the National Aeronautics and Space Administration, the requirements of subsection (a) for any fiscal year apply to the total value of all prime contract and subcontract awards entered into by the National Aeronautics and Space Administration for such fiscal year. (c) Types of Assistance. - (1) To attain the goal specified in subsection (a)(1), the head of an agency shall provide technical assistance to the entities referred to in that subsection and, in the case of historically Black colleges and universities, Hispanic- serving institutions, Native Hawaiian-serving institutions and Alaska Native-serving institutions, and minority institutions, shall also provide infrastructure assistance. (2) Technical assistance provided under this section shall include information about the program, advice about agency procurement procedures, instruction in preparation of proposals, and other such assistance as the head of the agency considers appropriate. If the resources of the agency are inadequate to provide such assistance, the head of the agency may enter into contracts with minority private sector entities with experience and expertise in the design, development, and delivery of technical assistance services to eligible individuals, business firms and institutions, acquisition agencies, and prime contractors. Agency contracts with such entities shall be awarded annually, based upon, among other things, the number of minority small business concerns, historically Black colleges and universities, and minority institutions that each such entity brings into the program. (3) Infrastructure assistance provided by the Department of Defense under this section to historically Black colleges and universities, to Hispanic-serving institutions, to Native Hawaiian- serving institutions and Alaska Native-serving institutions, and to minority institutions may include programs to do the following: (A) Establish and enhance undergraduate, graduate, and doctoral programs in scientific disciplines critical to the national security functions of the Department of Defense. (B) Make Department of Defense personnel available to advise and assist faculty at such colleges and universities in the performance of defense research and in scientific disciplines critical to the national security functions of the Department of Defense. (C) Establish partnerships between defense laboratories and historically Black colleges and universities and minority institutions for the purpose of training students in scientific disciplines critical to the national security functions of the Department of Defense. (D) Award scholarships, fellowships, and the establishment of cooperative work-education programs in scientific disciplines critical to the national security functions of the Department of Defense. (E) Attract and retain faculty involved in scientific disciplines critical to the national security functions of the Department of Defense. (F) Equip and renovate laboratories for the performance of defense research. (G) Expand and equip Reserve Officer Training Corps activities devoted to scientific disciplines critical to the national security functions of the Department of Defense. (H) Provide other assistance as the Secretary determines appropriate to strengthen scientific disciplines critical to the national security functions of the Department of Defense or the college infrastructure to support the performance of defense research. (4) The head of the agency shall, to the maximum extent practical, carry out programs under this section at colleges, universities, and institutions that agree to bear a substantial portion of the cost associated with the programs. (d) Applicability. - Subsection (a) does not apply to the Department of Defense - (1) to the extent to which the Secretary of Defense determines that compelling national security considerations require otherwise; and (2) if the Secretary notifies Congress of such determination and the reasons for such determination. (e) Competitive Procedures and Advance Payments. - To attain the goal of subsection (a): (1)(A) The head of the agency shall - (i) ensure that substantial progress is made in increasing awards of agency contracts to entities described in subsection (a)(1); (ii) exercise his utmost authority, resourcefulness, and diligence; (iii) in the case of the Department of Defense, actively monitor and assess the progress of the military departments, Defense Agencies, and prime contractors of the Department of Defense in attaining such goal; and (iv) in the case of the Coast Guard and the National Aeronautics and Space Administration, actively monitor and assess the progress of the prime contractors of the agency in attaining such goal. (B) In making the assessment under clauses (iii) and (iv) of subparagraph (A), the head of the agency shall evaluate the extent to which use of the authority provided in paragraphs (2) and (3) and compliance with the requirement in paragraph (4) is effective for facilitating the attainment of the goal. (2) To the extent practicable and when necessary to facilitate achievement of the 5 percent goal described in subsection (a), the head of an agency shall make advance payments under section 2307 of this title to contractors described in subsection (a). The Federal Acquisition Regulation shall provide guidance to contracting officers for making advance payments to entities described in subsection (a)(1) under such section. (3)(A) To the extent practicable and when necessary to facilitate achievement of the 5 percent goal described in subsection (a), the head of an agency may, except as provided in subparagraph (B), enter into contracts using less than full and open competitive procedures (including awards under section 8(a) of the Small Business Act) and partial set asides for entities described in subsection (a)(1), but shall pay a price not exceeding fair market cost by more than 10 percent in payment per contract to contractors or subcontractors described in subsection (a). The head of an agency shall adjust the percentage specified in the preceding sentence for any industry category if available information clearly indicates that nondisadvantaged small business concerns in such industry category are generally being denied a reasonable opportunity to compete for contracts because of the use of that percentage in the application of this paragraph. (B)(i) The Secretary of Defense may not exercise the authority under subparagraph (A) to enter into a contract for a price exceeding fair market cost if the regulations implementing that authority are suspended under clause (ii) with respect to that contract. (ii) At the beginning of each fiscal year, the Secretary shall determine, on the basis of the most recent data, whether the Department of Defense achieved the 5 percent goal described in subsection (a) during the fiscal year to which the data relates. Upon determining that the Department achieved the goal for the fiscal year to which the data relates, the Secretary shall issue a suspension, in writing, of the regulations that implement the authority under subparagraph (A). Such a suspension shall be in effect for the one-year period beginning 30 days after the date on which the suspension is issued and shall apply with respect to contracts awarded pursuant to solicitations issued during that period. (iii) For purposes of clause (ii), the term "most recent data" means data relating to the most recent fiscal year for which data are available. (4) To the extent practicable, the head of an agency shall maximize the number of minority small business concerns, historically Black colleges and universities, and minority institutions participating in the program. (5) Each head of an agency shall prescribe regulations which provide for the following: (A) Procedures or guidance for contracting officers to provide incentives for prime contractors referred to in subsection (a)(3) to increase subcontractor awards to entities described in subsection (a)(1). (B) A requirement that contracting officers emphasize the award of contracts to entities described in subsection (a)(1) in all industry categories, including those categories in which such entities have not traditionally dominated. (C) Guidance to agency personnel on the relationship among the following programs: (i) The program implementing this section. (ii) The program established under section 8(a) of the Small Business Act (15 U.S.C. 637(a)). (iii) The small business set-aside program established under section 15(a) of the Small Business Act (15 U.S.C. 644(a)). (D) With respect to an agency procurement which is reasonably likely to be set aside for entities described in subsection (a)(1), a requirement that (to the maximum extent practicable) the procurement be designated as such a set-aside before the solicitation for the procurement is issued. (E) Policies and procedures which, to the maximum extent practicable, will ensure that current levels in the number or dollar value of contracts awarded under the program established under section 8(a) of the Small Business Act (15 U.S.C. 637(a)) and under the small business set-aside program established under section 15(a) of the Small Business Act (15 U.S.C. 644(a)) are maintained and that every effort is made to provide new opportunities for contract awards to eligible entities, in order to meet the goal of subsection (a). (F) Implementation of this section in a manner which will not alter the procurement process under the program established under section 8(a) of the Small Business Act (15 U.S.C. 637(a)). (G) A requirement that one factor used in evaluating the performance of a contracting officer be the ability of the officer to increase contract awards to entities described in subsection (a)(1). (H) Increased technical assistance to entities described in subsection (a)(1). (f) Penalties and Regulations Relating to Status. - (1) Whoever for the purpose of securing a contract or subcontract under subsection (a) misrepresents the status of any concern or person as a small business concern owned and controlled by a minority (as described in subsection (a)) or as a qualified HUBZone small business concern (as defined in section 3(p) of the Small Business Act), shall be punished by imprisonment for not more than one year, or a fine under title 18, or both. (2) The Federal Acquisition Regulation shall prohibit awarding a contract under this section to an entity described in subsection (a)(1) unless the entity agrees to comply with the requirements of section 15(o)(1) of the Small Business Act (15 U.S.C. 644(o)(1)). (g) Industry Categories. - (1) To the maximum extent practicable, the head of the agency shall - (A) ensure that no particular industry category bears a disproportionate share of the contracts awarded to attain the goal established by subsection (a); and (B) ensure that contracts awarded to attain the goal established by subsection (a) are made across the broadest possible range of industry categories. (2) Under procedures prescribed by the head of the agency, a person may request the Secretary to determine whether the use of small disadvantaged business set asides by a contracting activity of the agency has caused a particular industry category to bear a disproportionate share of the contracts awarded to attain the goal established for that contracting activity for the purposes of this section. Upon making a determination that a particular industry category is bearing a disproportionate share, the head of the agency shall take appropriate actions to limit the contracting activity's use of set asides in awarding contracts in that particular industry category. (h) Compliance With Subcontracting Plan Requirements. - (1) The Federal Acquisition Regulation shall contain regulations to ensure that potential contractors submitting sealed bids or competitive proposals to the agency for procurement contracts to be awarded under the program provided for by this section are complying with applicable subcontracting plan requirements of section 8(d) of the Small Business Act (15 U.S.C. 637(d)). (2) The regulations required by paragraph (1) shall ensure that, with respect to a sealed bid or competitive proposal for which the bidder or offeror is required to negotiate or submit a subcontracting plan under section 8(d) of the Small Business Act (15 U.S.C. 637(d)), the subcontracting plan shall be a factor in evaluating the bid or proposal. (i) Annual Report. - (1) Not later than December 15 of each year, the head of the agency shall submit to Congress a report on the progress of the agency toward attaining the goal of subsection (a) during the preceding fiscal year. (2) The report required under paragraph (1) shall include the following: (A) A full explanation of any progress toward attaining the goal of subsection (a). (B) A plan to achieve the goal, if necessary. (j) Definitions. - In this section: (1) The term "agency" means the Department of Defense, the Coast Guard, and the National Aeronautics and Space Administration. (2) The term "head of an agency" means the Secretary of Defense, the Secretary of Homeland Security, and the Administrator of the National Aeronautics and Space Administration. (k) Effective Date. - (1) This section applies in the Department of Defense to each of fiscal years 1987 through 2009. (2) This section applies in the Coast Guard and the National Aeronautics and Space Administration in each of fiscal years 1995 through 2009. -SOURCE- (Added and amended Pub. L. 102-484, div. A, title VIII, Secs. 801(a)(1), (b)-(f), 802, Oct. 23, 1992, 106 Stat. 2442-2444, 2446; Pub. L. 103-35, title II, Sec. 202(a)(6), May 31, 1993, 107 Stat. 101; Pub. L. 103-160, div. A, title VIII, Sec. 811(a)-(c), (e), Nov. 30, 1993, 107 Stat. 1702; Pub. L. 103-355, title VII, Sec. 7105, Oct. 13, 1994, 108 Stat. 3369; Pub. L. 104-106, div. D, title XLIII, Sec. 4321(b)(8), Feb. 10, 1996, 110 Stat. 672; Pub. L. 105- 135, title VI, Sec. 604(a), Dec. 2, 1997, 111 Stat. 2632; Pub. L. 105-261, div. A, title VIII, Sec. 801, Oct. 17, 1998, 112 Stat. 2080; Pub. L. 106-65, div. A, title VIII, Sec. 808, Oct. 5, 1999, 113 Stat. 705; Pub. L. 107-107, div. A, title X, Sec. 1048(a)(17), Dec. 28, 2001, 115 Stat. 1223; Pub. L. 107-296, title XVII, Sec. 1704(b)(1), Nov. 25, 2002, 116 Stat. 2314; Pub. L. 107-314, div. A, title VIII, Sec. 816, Dec. 2, 2002, 116 Stat. 2610; Pub. L. 108- 136, div. A, title X, Sec. 1031(a)(15), Nov. 24, 2003, 117 Stat. 1597; Pub. L. 109-163, div. A, title VIII, Sec. 842, Jan. 6, 2006, 119 Stat. 3389; Pub. L. 109-364, div. A, title VIII, Sec. 858, Oct. 17, 2006, 120 Stat. 2349; Pub. L. 110-181, div. A, title VIII, Sec. 891, Jan. 28, 2008, 122 Stat. 270; Pub. L. 111-383, div. A, title X, Sec. 1075(b)(31), Jan. 7, 2011, 124 Stat. 4370.) -REFTEXT- REFERENCES IN TEXT Section 3(p) of the Small Business Act, referred to in subsecs. (a)(1)(A) and (f)(1), is classified to section 632(p) of Title 15, Commerce and Trade. Section 317 of the Higher Education Act of 1965, referred to in subsec. (a)(1)(E), is classified to section 1059d of Title 20, Education. Section 8(a) of the Small Business Act, referred to in subsec. (e)(3)(A), is classified to section 637(a) of Title 15, Commerce and Trade. -COD- CODIFICATION Section, as added by Pub. L. 102-484, Sec. 801(a)(1), consists of text of Pub. L. 99-661, div. A, title XII, Sec. 1207, Nov. 14, 1986, 100 Stat. 3973, revised by Pub. L. 102-484 by substituting "each of fiscal years 1987 through 2000" for "each of fiscal years 1987, 1988, 1989, 1990, 1991, 1992, and 1993" in subsec. (a)(1), "of this title" for "of title 10, United States Code," in subsec. (e)(2), and "each of fiscal years 1987 through 2000" for "each of fiscal years 1987, 1988, 1989, 1990, 1991, 1992, and 1993" in subsec. (h). Section 1207 of Pub. L. 99-661, which was formerly set out as a note under section 2301 of this title, was repealed by Pub. L. 102-484, div. A, title VIII, Sec. 801(h)(1), Oct. 23, 1992, 106 Stat. 2445. -MISC1- PRIOR PROVISIONS A prior section 2323, added Pub. L. 98-525, title XII, Sec. 1216(a), Oct. 19, 1984, 98 Stat. 2598; amended Pub. L. 99-500, Sec. 101(c) [title X, Sec. 926(a)(1)], Oct. 18, 1986, 100 Stat. 1783-82, 1783-153, and Pub. L. 99-591, Sec. 101(c) [title X, Sec. 926(a)(1)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-153; Pub. L. 99- 661, div. A, title IX, formerly title IV, Sec. 926(a)(1), Nov. 14, 1986, 100 Stat. 3933, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, related to commercial pricing for spare or repair parts, prior to repeal by Pub. L. 101-510, div. A, title VIII, Sec. 804(a), Nov. 5, 1990, 104 Stat. 1591. AMENDMENTS 2011 - Subsec. (a)(1)(D). Pub. L. 111-383 inserted closing parenthesis before semicolon. 2008 - Subsec. (a)(1)(E). Pub. L. 110-181, Sec. 891(1), added subpar. (E). Subsecs. (a)(2), (c)(1). Pub. L. 110-181, Sec. 891(2), (3), inserted "Native Hawaiian-serving institutions and Alaska Native- serving institutions," after "Hispanic-serving institutions,". Subsec. (c)(3). Pub. L. 110-181, Sec. 891(4), inserted "to Native Hawaiian-serving institutions and Alaska Native-serving institutions," after "Hispanic-serving institutions," in introductory provisions. 2006 - Subsec. (a)(1)(D). Pub. L. 109-364, Sec. 858(1), added subpar. (D). Subsec. (a)(2). Pub. L. 109-364, Sec. 858(2), inserted ", Hispanic-serving institutions," before "and minority institutions" and "and institutions" before "in the program". Subsec. (c)(1). Pub. L. 109-364, Sec. 858(3), inserted ", Hispanic-serving institutions," before "and minority institutions". Subsec. (c)(3). Pub. L. 109-364, Sec. 858(4), inserted ", to Hispanic-serving institutions," before "and to minority institutions" in introductory provisions. Subsec. (k). Pub. L. 109-163 substituted "2009" for "2006" in pars. (1) and (2). 2003 - Subsec. (i)(3). Pub. L. 108-136 struck out par. (3) which listed certain items to be included in the report required under par. (1). 2002 - Subsec. (j)(2). Pub. L. 107-296 substituted "of Homeland Security" for "of Transportation". Subsec. (k). Pub. L. 107-314 substituted "2006" for "2003" in pars. (1) and (2). 2001 - Subsec. (a)(1)(C). Pub. L. 107-107 substituted "section 365(3)" for "section 1046(3)" and "20 U.S.C. 1067k" for "20 U.S.C. 1135d-5(3)" and struck out before period at end ", which, for the purposes of this section, shall include Hispanic-serving institutions (as defined in section 316(b)(1) of such Act (20 U.S.C. 1059c(b)(1)))". 1999 - Subsec. (k). Pub. L. 106-65 substituted "2003" for "2000" in pars. (1) and (2). 1998 - Subsec. (e)(3). Pub. L. 105-261 designated existing provisions as subpar. (A), inserted ", except as provided in subparagraph (B)," after "the head of an agency may" in first sentence, and added subpar. (B). 1997 - Subsec. (a)(1)(A). Pub. L. 105-135, Sec. 604(a)(1), inserted before semicolon at end ", and qualified HUBZone small business concerns (as defined in section 3(p) of the Small Business Act)". Subsec. (f)(1). Pub. L. 105-135, Sec. 604(a)(2), inserted "or as a qualified HUBZone small business concern (as defined in section 3(p) of the Small Business Act)" after "(as described in subsection (a))". 1996 - Subsec. (a)(1)(C). Pub. L. 104-106, Sec. 4321(b)(8)(A), inserted closing parenthesis after "1135d-5(3))" and "1059c(b)(1))". Subsec. (a)(3). Pub. L. 104-106, Sec. 4321(b)(8)(B), struck out "(issued under section 25(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 421(c))" after "Acquisition Regulation". Subsec. (b). Pub. L. 104-106, Sec. 4321(b)(8)(C), inserted "(1)" after "Amount. - ". Subsec. (i)(3)(D). Pub. L. 104-106, Sec. 4321(b)(8)(D), added subpar. (D). 1994 - Pub. L. 103-355 amended section generally to extend defense contract goal for small disadvantaged businesses and certain institutions of higher education to Coast Guard and National Aeronautics and Space Administration. 1993 - Subsec. (a)(1)(B). Pub. L. 103-160, Sec. 811(a), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: "historically Black colleges and universities; and". Subsec. (a)(1)(C). Pub. L. 103-160, Sec. 811(b), amended subpar. (C) generally. Prior to amendment, subpar. (C) read as follows: "minority institutions (as defined in paragraphs (3), (4), and (5) of section 312(b) of the Higher Education Act of 1965 (20 U.S.C. 1058)), including any nonprofit research institution that was an integral part of a historically Black college or university before November 14, 1986." Subsec. (f)(2). Pub. L. 103-160, Sec. 811(c), amended par. (2) generally. Prior to amendment, par. (2) read as follows: "The Secretary of Defense shall prescribe regulations which provide for the following: "(A) A requirement that a business which represents itself as an entity described in subsection (a)(1) and is seeking a Department of Defense contract maintain its status as an entity at the time of contract award. "(B) A prohibition on the award of a contract under this section to an entity described in subsection (a)(1) unless the entity agrees to comply with the requirements of section 15(o)(1) of the Small Business Act (15 U.S.C. 644(o)(1))." Subsec. (i). Pub. L. 103-35 amended and made technical amendment to directory language of Pub. L. 102-484, Sec. 801(f). See 1992 Amendment note for subsec. (h) below. Subsec. (i)(3)(D). Pub. L. 103-160, Sec. 811(e), added subpar. (D). 1992 - Subsec. (a)(3). Pub. L. 102-484, Sec. 801(b), added par. (3). Subsec. (e). Pub. L. 102-484, Sec. 801(c)(1), substituted "subsection (a):" for "subsection (a) - " in introductory provisions. Subsec. (e)(1). Pub. L. 102-484, Sec. 801(c)(2), added par. (1) and struck out former par. (1) which read as follows: "The Secretary of Defense shall exercise his utmost authority, resourcefulness, and diligence." Subsec. (e)(2). Pub. L. 102-484, Sec. 801(c)(3), inserted at end "The Secretary shall prescribe regulations that provide guidance to contracting officers for making advance payments to entities described in subsection (a)(1) under such section." Subsec. (e)(3). Pub. L. 102-484, Sec. 801(c)(4), inserted "and partial set asides for entities described in subsection (a)(1)" after "Act". Subsec. (e)(5). Pub. L. 102-484, Sec. 801(c)(5), added par. (5). Subsec. (f). Pub. L. 102-484, Sec. 801(d), substituted "Penalties and Regulations Relating to Status" for "Penalties for Misrepresentation" in heading, designated existing provisions as par. (1), and added par. (2). Subsec. (g). Pub. L. 102-484, Sec. 801(e)(2), added subsec. (g). Former subsec. (g) redesignated (h). Subsec. (h). Pub. L. 102-484, Sec. 802(2), added subsec. (h). Former subsec. (h) redesignated (i). Pub. L. 102-484, Sec. 801(f), as amended by Pub. L. 103-35, substituted "Report" for "Reports" in heading, struck out "July 15 of each year, the Secretary of Defense shall submit to Congress a report on the progress toward meeting the goal of subsection (a) during the current fiscal year. (2) Not later than" after "(1) Not later than", struck out "final" after "Congress a", and substituted "Secretary toward attaining" for "Secretary with" in former par. (2), redesignated par. (3) as (2) and substituted "report required under paragraph (1) shall" for "reports described in paragraphs (1) and (2) shall each", redesignated par. (4) as (3) and substituted "report required under paragraph (1)" for "reports required under paragraph (2)", and struck out par. (5) which read as follows: "The first report required by this subsection shall be submitted between May 1 and May 30, 1987." Pub. L. 102-484, Sec. 801(e)(1), redesignated subsec. (g) as (h). Former subsec. (h) redesignated (i). Subsec. (i). Pub. L. 102-484, Sec. 802(1), redesignated subsec. (h) as (i). Former subsec. (i) redesignated (j). Pub. L. 102-484, Sec. 801(e)(1), redesignated subsec. (h) as (i). Subsec. (j). Pub. L. 102-484, Sec. 802(1), redesignated subsec. (i) as (j). EFFECTIVE DATE OF 2002 AMENDMENT Amendment by Pub. L. 107-296 effective on the date of transfer of the Coast Guard to the Department of Homeland Security, see section 1704(g) of Pub. L. 107-296, set out as a note under section 101 of this title. EFFECTIVE DATE OF 1997 AMENDMENT Amendment by Pub. L. 105-135 effective Oct. 1, 1997, see section 3 of Pub. L. 105-135 set out as a note under section 631 of Title 15, Commerce and Trade. EFFECTIVE DATE OF 1996 AMENDMENT For effective date and applicability of amendment by Pub. L. 104- 106, see section 4401 of Pub. L. 104-106, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1994 AMENDMENT For effective date and applicability of amendment by Pub. L. 103- 355, see section 10001 of Pub. L. 103-355, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1993 AMENDMENT Amendment by Pub. L. 103-35 applicable as if included in the enactment of Pub. L. 102-484, see section 202(b) of Pub. L. 103-35, set out as a note under section 155 of this title. EFFECTIVE DATE OF 1992 AMENDMENT Section 801(f) of Pub. L. 102-484 provided that the amendment made by that section is effective Oct. 1, 1993. REGULATIONS Pub. L. 103-160, div. A, title VIII, Sec. 811(d), Nov. 30, 1993, 107 Stat. 1702, provided that: "(1) The Secretary of Defense shall propose amendments to the Department of Defense Supplement to the Federal Acquisition Regulation that address the matters described in subsection (g) and subsection (h)(2) of section 2323 of title 10, United States Code. "(2) Not later than 15 days after the date of the enactment of this Act [Nov. 30, 1993], the Secretary shall publish such proposed amendments in accordance with section 22 of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 418b) [now 41 U.S.C. 1707]. The Secretary shall provide a period of at least 60 days for public comment on the proposed amendments. "(3) The Secretary shall publish the final regulations not later than 120 days after the date of the enactment of this Act." -TRANS- TRANSFER OF FUNCTIONS For transfer of authorities, functions, personnel, and assets of the Coast Guard, including the authorities and functions of the Secretary of Transportation relating thereto, to the Department of Homeland Security, and for treatment of related references, see sections 468(b), 551(d), 552(d), and 557 of Title 6, Domestic Security, and the Department of Homeland Security Reorganization Plan of November 25, 2002, as modified, set out as a note under section 542 of Title 6. -End- -CITE- 10 USC Sec. 2323a 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2323a. Credit for Indian contracting in meeting certain subcontracting goals for small disadvantaged businesses and certain institutions of higher education -STATUTE- (a) Regulations. - Subject to subsections (b) and (c), in any case in which a subcontracting goal is specified in a Department of Defense contract in the implementation of section 2323 of this title and section 8(d) of the Small Business Act (15 U.S.C. 637(d)), credit toward meeting that subcontracting goal shall be given for - (1) work performed in connection with that Department of Defense contract, and work performed in connection with any subcontract awarded under that Department of Defense contract, if such work is performed on any Indian lands and meets the requirements of paragraph (1) of subsection (b); or (2) work performed in connection with that Department of Defense contract, and work performed in connection with any subcontract awarded under that Department of Defense contract, if the performance of such contract or subcontract is undertaken as a joint venture that meets the requirements of paragraph (2) of that subsection. (b) Eligible Work. - (1) Work performed on Indian lands meets the requirements of this paragraph if - (A) not less than 40 percent of the workers directly engaged in the performance of the work are Indians; or (B) the contractor or subcontractor has an agreement with the tribal government having jurisdiction over such Indian lands that provides goals for training and development of the Indian workforce and Indian management. (2) A joint venture undertaking to perform a contract or subcontract meets the requirements of this paragraph if - (A) an Indian tribe or tribally owned corporation owns at least 50 percent of the joint venture; (B) the activities of the joint venture under the contract or subcontract provide employment opportunities for Indians either directly or through the purchase of products or services for the performance of such contract or subcontract; and (C) the Indian tribe or tribally owned corporation manages the performance of such contract or subcontract. (c) Extent of Credit. - The amount of the credit given toward the attainment of any subcontracting goal under subsection (a) shall be - (1) in the case of work performed as described in subsection (a)(1), the value of the work performed; and (2) in the case of a contract or subcontract undertaken to be performed by a joint venture as described in subsection (a)(2), an amount equal to the amount of the contract or subcontract multiplied by the percentage of the tribe's or tribally owned corporation's ownership interest in the joint venture. (d) Regulations. - The Secretary of Defense shall prescribe regulations for the implementation of this section. (e) Definitions. - In this section: (1) The term "Indian lands" has the meaning given that term by section 4(4) of the Indian Gaming Regulatory Act (102 Stat. 2468; 25 U.S.C. 2703(4)). (2) The term "Indian" has the meaning given that term by section 4(d) of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450b(d)). (3) The term "Indian tribe" has the meaning given that term by section 4(e) of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450b(e)). (4) The term "tribally owned corporation" means a corporation owned entirely by an Indian tribe. -SOURCE- (Added Pub. L. 102-484, div. A, title VIII, Sec. 801(g)(1), Oct. 23, 1992, 106 Stat. 2445; amended Pub. L. 104-201, div. A, title X, Sec. 1074(a)(13), Sept. 23, 1996, 110 Stat. 2659.) -COD- CODIFICATION Section, as added by Pub. L. 102-484, consists of text of Pub. L. 101-189, div. A, title VIII, Sec. 832, Nov. 29, 1989, 103 Stat. 1508, revised by Pub. L. 102-484 by substituting "section 2323 of this title" for "section 1207 of the National Defense Authorization Act for Fiscal Year 1987 (10 U.S.C. 2301 note)" in subsec. (a). Section 832 of Pub. L. 101-189, which was formerly set out as a note under section 2301 of this title, was repealed by Pub. L. 102- 484, div. A, title VIII, Sec. 801(h)(5), Oct. 23, 1992, 106 Stat. 2445. -MISC1- AMENDMENTS 1996 - Subsec. (a). Pub. L. 104-201, which directed amendment of subsec. (a) by substituting "section 2323 of this title" for "section 1207 of the National Defense Authorization Act for Fiscal Year 1987 (10 U.S.C. 2301 note)", could not be executed because the language "section 1207 of the National Defense Authorization Act for Fiscal Year 1987 (10 U.S.C. 2301 note)" did not appear. See Codification note above. -End- -CITE- 10 USC Sec. 2324 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2324. Allowable costs under defense contracts -STATUTE- (a) Indirect Cost That Violates a FAR Cost Principle. - The head of an agency shall require that a covered contract provide that if the contractor submits to the agency a proposal for settlement of indirect costs incurred by the contractor for any period after such costs have been accrued and if that proposal includes the submission of a cost which is unallowable because the cost violates a cost principle in the Federal Acquisition Regulation or applicable agency supplement to the Federal Acquisition Regulation, the cost shall be disallowed. (b) Penalty for Violation of Cost Principle. - (1) If the head of the agency determines that a cost submitted by a contractor in its proposal for settlement is expressly unallowable under a cost principle referred to in subsection (a) that defines the allowability of specific selected costs, the head of the agency shall assess a penalty against the contractor in an amount equal to - (A) the amount of the disallowed cost allocated to covered contracts for which a proposal for settlement of indirect costs has been submitted; plus (B) interest (to be computed based on provisions in the Federal Acquisition Regulation) to compensate the United States for the use of any funds which a contractor has been paid in excess of the amount to which the contractor was entitled. (2) If the head of the agency determines that a proposal for settlement of indirect costs submitted by a contractor includes a cost determined to be unallowable in the case of such contractor before the submission of such proposal, the head of the agency shall assess a penalty against the contractor in an amount equal to two times the amount of the disallowed cost allocated to covered contracts for which a proposal for settlement of indirect costs has been submitted. (c) Waiver of Penalty. - The Federal Acquisition Regulation shall provide for a penalty under subsection (b) to be waived in the case of a contractor's proposal for settlement of indirect costs when - (1) the contractor withdraws the proposal before the formal initiation of an audit of the proposal by the Federal Government and resubmits a revised proposal; (2) the amount of unallowable costs subject to the penalty is insignificant; or (3) the contractor demonstrates, to the contracting officer's satisfaction, that - (A) it has established appropriate policies and personnel training and an internal control and review system that provide assurances that unallowable costs subject to penalties are precluded from being included in the contractor's proposal for settlement of indirect costs; and (B) the unallowable costs subject to the penalty were inadvertently incorporated into the proposal. (d) Applicability of Contract Disputes Procedure to Disallowance of Cost and Assessment of Penalty. - An action of the head of an agency under subsection (a) or (b) - (1) shall be considered a final decision for the purposes of section 7103 of title 41; and (2) is appealable in the manner provided in section 7104(a) of title 41. (e) Specific Costs Not Allowable. - (1) The following costs are not allowable under a covered contract: (A) Costs of entertainment, including amusement, diversion, and social activities and any costs directly associated with such costs (such as tickets to shows or sports events, meals, lodging, rentals, transportation, and gratuities). (B) Costs incurred to influence (directly or indirectly) legislative action on any matter pending before Congress, a State legislature, or a legislative body of a political subdivision of a State. (C) Costs incurred in defense of any civil or criminal fraud proceeding or similar proceeding (including filing of any false certification) brought by the United States where the contractor is found liable or has pleaded nolo contendere to a charge of fraud or similar proceeding (including filing of a false certification). (D) Payments of fines and penalties resulting from violations of, or failure to comply with, Federal, State, local, or foreign laws and regulations, except when incurred as a result of compliance with specific terms and conditions of the contract or specific written instructions from the contracting officer authorizing in advance such payments in accordance with applicable provisions of the Federal Acquisition Regulation. (E) Costs of membership in any social, dining, or country club or organization. (F) Costs of alcoholic beverages. (G) Contributions or donations, regardless of the recipient. (H) Costs of advertising designed to promote the contractor or its products. (I) Costs of promotional items and memorabilia, including models, gifts, and souvenirs. (J) Costs for travel by commercial aircraft which exceed the amount of the standard commercial fare. (K) Costs incurred in making any payment (commonly known as a "golden parachute payment") which is - (i) in an amount in excess of the normal severance pay paid by the contractor to an employee upon termination of employment; and (ii) is paid to the employee contingent upon, and following, a change in management control over, or ownership of, the contractor or a substantial portion of the contractor's assets. (L) Costs of commercial insurance that protects against the costs of the contractor for correction of the contractor's own defects in materials or workmanship. (M) Costs of severance pay paid by the contractor to foreign nationals employed by the contractor under a service contract performed outside the United States, to the extent that the amount of severance pay paid in any case exceeds the amount paid in the industry involved under the customary or prevailing practice for firms in that industry providing similar services in the United States, as determined under the Federal Acquisition Regulation. (N) Costs of severance pay paid by the contractor to a foreign national employed by the contractor under a service contract performed in a foreign country if the termination of the employment of the foreign national is the result of the closing of, or the curtailment of activities at, a United States military facility in that country at the request of the government of that country. (O) Costs incurred by a contractor in connection with any criminal, civil, or administrative proceeding commenced by the United States or a State, to the extent provided in subsection (k). (P) Costs of compensation of any contractor employee for a fiscal year, regardless of the contract funding source, to the extent that such compensation exceeds the benchmark compensation amount determined applicable for the fiscal year by the Administrator for Federal Procurement Policy under section 1127 of title 41, except that the Secretary of Defense may establish one or more narrowly targeted exceptions for scientists and engineers upon a determination that such exceptions are needed to ensure that the Department of Defense has continued access to needed skills and capabilities. (2)(A) The Secretary of Defense may provide in a military banking contract that the provisions of paragraphs (1)(M) and (1)(N) shall not apply to costs incurred under the contract by the contractor for payment of mandated foreign national severance pay. The Secretary may include such a provision in a military banking contract only if the Secretary determines, with respect to that contract, that the contractor has taken (or has established plans to take) appropriate actions within the contractor's control to minimize the amount and number of incidents of the payment of severance pay by the contractor to employees under the contract who are foreign nationals. (B) In subparagraph (A): (i) The term "military banking contract" means a contract between the Secretary and a financial institution under which the financial institution operates a military banking facility outside the United States for use by members of the armed forces stationed or deployed outside the United States and other authorized personnel. (ii) The term "mandated foreign national severance pay" means severance pay paid by a contractor to a foreign national employee the payment of which by the contractor is required in order to comply with a law that is generally applicable to a significant number of businesses in the country in which the foreign national receiving the payment performed services under the contract. (C) Subparagraph (A) does not apply to a contract with a financial institution that is owned or controlled by citizens or nationals of a foreign country, as determined by the Secretary of Defense. Such a determination shall be made in accordance with the criteria set out in paragraph (1) of section 4(g) of the Buy American Act (as added by section 7002(2) of the Omnibus Trade and Competitiveness Act of 1988) and the policy guidance referred to in paragraph (2)(A) of that section. (3)(A) Pursuant to the Federal Acquisition Regulation and subject to the availability of appropriations, the head of an agency awarding a covered contract (other than a contract to which paragraph (2) applies) may waive the application of the provisions of paragraphs (1)(M) and (1)(N) to that contract if the head of the agency determines that - (i) the application of such provisions to the contract would adversely affect the continuation of a program, project, or activity that provides significant support services for members of the armed forces stationed or deployed outside the United States; (ii) the contractor has taken (or has established plans to take) appropriate actions within the contractor's control to minimize the amount and number of incidents of the payment of severance pay by the contractor to employees under the contract who are foreign nationals; and (iii) the payment of severance pay is necessary in order to comply with a law that is generally applicable to a significant number of businesses in the country in which the foreign national receiving the payment performed services under the contract or is necessary to comply with a collective bargaining agreement. (B) The head of an agency shall include in the solicitation for a covered contract a statement indicating - (i) that a waiver has been granted under subparagraph (A) for the contract; or (ii) whether the head of the agency will consider granting such a waiver, and, if the agency head will consider granting a waiver, the criteria to be used in granting the waiver. (C) The head of an agency shall make the final determination regarding whether to grant a waiver under subparagraph (A) with respect to a covered contract before award of the contract. (4) The provisions of the Federal Acquisition Regulation implementing this section may establish appropriate definitions, exclusions, limitations, and qualifications. (f) Required Regulations. - (1) The Federal Acquisition Regulation shall contain provisions on the allowability of contractor costs. Such provisions shall define in detail and in specific terms those costs which are unallowable, in whole or in part, under covered contracts. The regulations shall, at a minimum, clarify the cost principles applicable to contractor costs of the following: (A) Air shows. (B) Membership in civic, community, and professional organizations. (C) Recruitment. (D) Employee morale and welfare. (E) Actions to influence (directly or indirectly) executive branch action on regulatory and contract matters (other than costs incurred in regard to contract proposals pursuant to solicited or unsolicited bids). (F) Community relations. (G) Dining facilities. (H) Professional and consulting services, including legal services. (I) Compensation. (J) Selling and marketing. (K) Travel. (L) Public relations. (M) Hotel and meal expenses. (N) Expense of corporate aircraft. (O) Company-furnished automobiles. (P) Advertising. (Q) Conventions. (2) The Federal Acquisition Regulation shall require that a contracting officer not resolve any questioned costs until he has obtained - (A) adequate documentation with respect to such costs; and (B) the opinion of the contract auditor on the allowability of such costs. (3) The Federal Acquisition Regulation shall provide that, to the maximum extent practicable, the contract auditor be present at any negotiation or meeting with the contractor regarding a determination of the allowability of indirect costs of the contractor. (4) The Federal Acquisition Regulation shall require that all categories of costs designated in the report of the contract auditor as questioned with respect to a proposal for settlement be resolved in such a manner that the amount of the individual questioned costs that are paid will be reflected in the settlement. (g) Applicability of Regulations to Subcontractors. - The regulations referred to in subsections (e) and (f)(1) shall require prime contractors of a covered contract, to the maximum extent practicable, to apply the provisions of such regulations to all subcontractors of the covered contract. (h) Contractor Certification Required. - (1) A proposal for settlement of indirect costs applicable to a covered contract shall include a certification by an official of the contractor that, to the best of the certifying official's knowledge and belief, all indirect costs included in the proposal are allowable. Any such certification shall be in a form prescribed in the Federal Acquisition Regulation. (2) The head of the agency or the Secretary of the military department concerned may, in an exceptional case, waive the requirement for certification under paragraph (1) in the case of any contract if the head of the agency or the Secretary - (A) determines in such case that it would be in the interest of the United States to waive such certification; and (B) states in writing the reasons for that determination and makes such determination available to the public. (i) Penalties for Submission of Cost Known as Not Allowable. - The submission to an agency of a proposal for settlement of costs for any period after such costs have been accrued that includes a cost that is expressly specified by statute or regulation as being unallowable, with the knowledge that such cost is unallowable, shall be subject to the provisions of section 287 of title 18 and section 3729 of title 31. (j) Contractor To Have Burden of Proof. - In a proceeding before the Armed Services Board of Contract Appeals, the United States Court of Federal Claims, or any other Federal court in which the reasonableness of indirect costs for which a contractor seeks reimbursement from the Department of Defense is in issue, the burden of proof shall be upon the contractor to establish that those costs are reasonable. (k) Proceeding Costs Not Allowable. - (1) Except as otherwise provided in this subsection, costs incurred by a contractor in connection with any criminal, civil, or administrative proceeding commenced by the United States or a State are not allowable as reimbursable costs under a covered contract if the proceeding (A) relates to a violation of, or failure to comply with, a Federal or State statute or regulation, and (B) results in a disposition described in paragraph (2). (2) A disposition referred to in paragraph (1)(B) is any of the following: (A) In the case of a criminal proceeding, a conviction (including a conviction pursuant to a plea of nolo contendere) by reason of the violation or failure referred to in paragraph (1). (B) In the case of a civil or administrative proceeding involving an allegation of fraud or similar misconduct, a determination of contractor liability on the basis of the violation or failure referred to in paragraph (1). (C) In the case of any civil or administrative proceeding, the imposition of a monetary penalty by reason of the violation or failure referred to in paragraph (1). (D) A final decision - (i) to debar or suspend the contractor; (ii) to rescind or void the contract; or (iii) to terminate the contract for default; by reason of the violation or failure referred to in paragraph (1). (E) A disposition of the proceeding by consent or compromise if such action could have resulted in a disposition described in subparagraph (A), (B), (C), or (D). (3) In the case of a proceeding referred to in paragraph (1) that is commenced by the United States and is resolved by consent or compromise pursuant to an agreement entered into by a contractor and the United States, the costs incurred by the contractor in connection with such proceeding that are otherwise not allowable as reimbursable costs under such paragraph may be allowed to the extent specifically provided in such agreement. (4) In the case of a proceeding referred to in paragraph (1) that is commenced by a State, the head of the agency or Secretary of the military department concerned that awarded the covered contract involved in the proceeding may allow the costs incurred by the contractor in connection with such proceeding as reimbursable costs if the agency head or Secretary determines, in accordance with the Federal Acquisition Regulation, that the costs were incurred as a result of (A) a specific term or condition of the contract, or (B) specific written instructions of the agency or military department. (5)(A) Except as provided in subparagraph (C), costs incurred by a contractor in connection with a criminal, civil, or administrative proceeding commenced by the United States or a State in connection with a covered contract may be allowed as reimbursable costs under the contract if such costs are not disallowable under paragraph (1), but only to the extent provided in subparagraph (B). (B)(i) The amount of the costs allowable under subparagraph (A) in any case may not exceed the amount equal to 80 percent of the amount of the costs incurred, to the extent that such costs are determined to be otherwise allowable and allocable under the Federal Acquisition Regulation. (ii) Regulations issued for the purpose of clause (i) shall provide for appropriate consideration of the complexity of procurement litigation, generally accepted principles governing the award of legal fees in civil actions involving the United States as a party, and such other factors as may be appropriate. (C) In the case of a proceeding referred to in subparagraph (A), contractor costs otherwise allowable as reimbursable costs under this paragraph are not allowable if (i) such proceeding involves the same contractor misconduct alleged as the basis of another criminal, civil, or administrative proceeding, and (ii) the costs of such other proceeding are not allowable under paragraph (1). (6) In this subsection: (A) The term "proceeding" includes an investigation. (B) The term "costs", with respect to a proceeding - (i) means all costs incurred by a contractor, whether before or after the commencement of any such proceeding; and (ii) includes - (I) administrative and clerical expenses; (II) the cost of legal services, including legal services performed by an employee of the contractor; (III) the cost of the services of accountants and consultants retained by the contractor; and (IV) the pay of directors, officers, and employees of the contractor for time devoted by such directors, officers, and employees to such proceeding. (C) The term "penalty" does not include restitution, reimbursement, or compensatory damages. (l) Definitions. - In this section: (1)(A) The term "covered contract" means a contract for an amount in excess of $500,000 that is entered into by the head of an agency, except that such term does not include a fixed-price contract without cost incentives or any firm fixed-price contract for the purchase of commercial items. (B) Effective on October 1 of each year that is divisible by five, the amount set forth in subparagraph (A) shall be adjusted to the equivalent amount in constant fiscal year 1994 dollars. An amount, as so adjusted, that is not evenly divisible by $50,000 shall be rounded to the nearest multiple of $50,000. In the case of an amount that is evenly divisible by $25,000 but is not evenly divisible by $50,000, the amount shall be rounded to the next higher multiple of $50,000. (2) The term "head of the agency" or "agency head" does not include the Secretary of a military department. (3) The term "agency" means the Department of Defense, the Coast Guard, and the National Aeronautics and Space Administration. (4) The term "compensation", for a year, means the total amount of wages, salary, bonuses and deferred compensation for the year, whether paid, earned, or otherwise accruing, as recorded in an employer's cost accounting records for the year. [(5) Repealed. Pub. L. 112-81, div. A, title VIII, Sec. 803(b), Dec. 31, 2011, 125 Stat. 1485.] (6) The term "fiscal year" means a fiscal year established by a contractor for accounting purposes. -SOURCE- (Added Pub. L. 99-145, title IX, Sec. 911(a)(1), Nov. 8, 1985, 99 Stat. 682; amended Pub. L. 99-190, Sec. 101(b) [title VIII, Sec. 8112(a)], Dec. 19, 1985, 99 Stat. 1185, 1223; Pub. L. 100-26, Sec. 7(k)(3), Apr. 21, 1987, 101 Stat. 284; Pub. L. 100-180, div. A, title VIII, Sec. 805(a), Dec. 4, 1987, 101 Stat. 1126; Pub. L. 100- 370, Sec. 1(f)(2)(A), (3)(A), July 19, 1988, 102 Stat. 846; Pub. L. 100-456, div. A, title III, Sec. 322(a), title VIII, Secs. 826(a), 832(a), Sept. 29, 1988, 102 Stat. 1952, 2022, 2023; Pub. L. 100-463, title VIII, Sec. 8105(a), Oct. 1, 1988, 102 Stat. 2270-36; Pub. L. 100-526, title I, Sec. 106(a)(2), Oct. 24, 1988, 102 Stat. 2625; Pub. L. 100-700, Sec. 8(b), Nov. 19, 1988, 102 Stat. 4636; Pub. L. 101-189, div. A, title III, Sec. 311(a)(1), title VIII, Sec. 853(a)(1), (b)(3), Nov. 29, 1989, 103 Stat. 1411, 1518; Pub. L. 101-510, div. A, title XIII, Sec. 1301(10), Nov. 5, 1990, 104 Stat. 1668; Pub. L. 102-190, div. A, title III, Sec. 346(a), Dec. 5, 1991, 105 Stat. 1346; Pub. L. 102-484, div. A, title VIII, Sec. 818(a), title X, Sec. 1052(26), title XIII, Sec. 1352(b), Oct. 23, 1992, 106 Stat. 2457, 2500, 2559; Pub. L. 103-355, title II, Sec. 2101(a)-(d), Oct. 13, 1994, 108 Stat. 3306-3308; Pub. L. 104-106, div. D, title XLIII, Sec. 4321(a)(5), (b)(9), Feb. 10, 1996, 110 Stat. 671, 672; Pub. L. 105-85, div. A, title VIII, Sec. 808(a), Nov. 18, 1997, 111 Stat. 1836; Pub. L. 105-261, div. A, title VIII, Sec. 804(a), Oct. 17, 1998, 112 Stat. 2083; Pub. L. 111-350, Sec. 5(b)(19), Jan. 4, 2011, 124 Stat. 3844; Pub. L. 112-81, div. A, title VIII, Sec. 803(a), (b), Dec. 31, 2011, 125 Stat. 1485.) -MISC1- HISTORICAL AND REVISION NOTES Subsection (e)(1)(L) is based on section 2399 of this title as enacted by Pub. L. 97-295, Sec. 1(29)(A), Oct. 12, 1982, 96 Stat. 1293. Section 1(f)(2) of the bill would transfer the provisions of existing 10 U.S.C. 2399 to a new subparagraph (L) of 10 U.S.C. 2324(e)(1). The existing section 2399 prohibits the use of appropriated funds to reimburse a defense contractor for insurance against the contractor's costs of correcting defects in the contractor's materials or workmanship. The transfer would add the provision to the list of contractor costs which are not allowable as expenses which may be paid by the Department of Defense under a contract. This allowable cost limitation applies only to contracts for more than $100,000 other than fixed price contracts without cost incentives (see 10 U.S.C. 2324(k)). The committee determined that it is appropriate to treat the subject matter of section 2399 in the same manner as other provisions relating to allowable costs of defense contractors and notes that section 2324, providing a more comprehensive treatment of allowable costs, was enacted after section 2399. The committee recognizes that contracts for amounts less than $100,000 and fixed price contracts without cost incentives are covered by the existing section 2399 and would not be covered by the provision as transferred. The committee determined that in practice the existing section 2399 would not have significant applicability to such contracts and that the transfer is appropriate as part of this bill. Subsection (j) is based on Pub. L. 99-145, title IX, Sec. 933, Nov. 8, 1985, 99 Stat. 700. -REFTEXT- REFERENCES IN TEXT Section 4 of the Buy American Act (as added by section 7002(2) of the Omnibus Trade and Competitiveness Act of 1988), referred to in subsec. (e)(2)(C), was section 4 of act Mar. 3, 1933, ch. 212, title III, as added Pub. L. 100-418, title VII, Sec. 7002(2), Aug. 23, 1988, 102 Stat. 1545. Section 4, which was classified to section 10b-1 of former Title 41, Public Contracts, was omitted from the Code in view of section 7004 of Pub. L. 100-418 which provided that the amendment by Pub. L. 100-418 which enacted section 4 ceased to be effective on Apr. 30, 1996. Section 4 was subsequently repealed by Pub. L. 111-350, Sec. 7(b), Jan. 4, 2011, 124 Stat. 3855, which Act enacted Title 41, Public Contracts. -COD- CODIFICATION Another section 2324 of this title was contained in chapter 138 and was renumbered section 2344 of this title. -MISC2- AMENDMENTS 2011 - Subsec. (d)(1). Pub. L. 111-350, Sec. 5(b)(19)(A), substituted "section 7103 of title 41" for "section 6 of the Contract Disputes Act of 1978 (41 U.S.C. 605)". Subsec. (d)(2). Pub. L. 111-350, Sec. 5(b)(19)(B), substituted "section 7104(a) of title 41" for "section 7 of such Act (41 U.S.C. 606)". Subsec. (e)(1)(P). Pub. L. 112-81, Sec. 803(a), substituted "any contractor employee" for "senior executives of contractors" and inserted", except that the Secretary of Defense may establish one or more narrowly targeted exceptions for scientists and engineers upon a determination that such exceptions are needed to ensure that the Department of Defense has continued access to needed skills and capabilities" before period at end. Pub. L. 111-350, Sec. 5(b)(19)(C), substituted "section 1127 of title 41" for "section 39 of the Office of Federal Procurement Policy Act (41 U.S.C. 435)". Subsec. (e)(2)(C). Pub. L. 111-350, Sec. 5(b)(19)(D), substituted "(as added by section 7002(2) of the Omnibus Trade and Competitiveness Act of 1988)" for "(41 U.S.C. 10b-1)". Subsec. (l)(5). Pub. L. 112-81, Sec. 803(b), struck out par. (5) which read as follows: "The term 'senior executives', with respect to a contractor, means the five most highly compensated employees in management positions at each home office and each segment of the contractor." 1998 - Subsec. (l)(5). Pub. L. 105-261 amended par. (5) generally. Prior to amendment, par. (5) read as follows: "The term 'senior executive', with respect to a contractor, means - "(A) the chief executive officer of the contractor or any individual acting in a similar capacity for the contractor; "(B) the four most highly compensated employees in management positions of the contractor other than the chief executive officer; and "(C) in the case of a contractor that has components which report directly to the contractor's headquarters, the five most highly compensated employees in management positions at each such component." 1997 - Subsec. (e)(1)(P). Pub. L. 105-85, Sec. 808(a)(1), added subpar. (P). Subsec. (l)(4) to (6). Pub. L. 105-85, Sec. 808(a)(2), added pars. (4) to (6). 1996 - Subsec. (e)(2)(C). Pub. L. 104-106, Sec. 4321(b)(9)(A), struck out "awarding the contract" after "Secretary of Defense" and substituted "the Buy American Act (41 U.S.C. 10b-1)" for "title III of the Act of March 3, 1933 (41 U.S.C. 10b-1) (commonly referred to as the Buy American Act)". Subsec. (f)(2) to (4). Pub. L. 104-106, Sec. 4321(a)(5), made technical correction to directory language of Pub. L. 103-355, Sec. 2101(a)(6)(B)(ii). See 1994 Amendment notes below. Subsec. (h)(2). Pub. L. 104-106, Sec. 4321(b)(9)(B), inserted "the head of the agency or" after "in the case of any contract if". 1994 - Subsec. (a). Pub. L. 103-355, Sec. 2101(a), inserted heading and substituted "head of an agency" for "Secretary of Defense", "agency" for "Department of Defense", and "applicable agency supplement" for "the Department of Defense Supplement". Subsec. (b). Pub. L. 103-355, Sec. 2101(a)(2)(A), inserted heading. Subsec. (b)(1). Pub. L. 103-355, Sec. 2101(a)(2)(C), substituted "head of the agency" for "Secretary" in two places in introductory provisions. Subsec. (b)(1)(B). Pub. L. 103-355, Sec. 2101(a)(2)(B), substituted "provisions in the Federal Acquisition Regulation" for "regulations issued by the Secretary". Subsec. (b)(2). Pub. L. 103-355, Sec. 2101(a)(2)(C), substituted "head of the agency" for "Secretary" in two places. Subsec. (c). Pub. L. 103-355, Sec. 2101(a)(3), inserted heading and substituted "The Federal Acquisition Regulation shall provide" for "The Secretary shall prescribe regulations providing". Subsec. (d). Pub. L. 103-355, Sec. 2101(a)(4), inserted heading and substituted "the head of an agency" for "the Secretary" in introductory provisions. Subsec. (e). Pub. L. 103-355, Sec. 2101(a)(5)(A), inserted heading. Subsec. (e)(1)(B). Pub. L. 103-355, Sec. 2101(b), substituted ", a State legislature, or a legislative body of a political subdivision of a State" for "or a State legislature". Subsec. (e)(1)(D). Pub. L. 103-355, Sec. 2101(a)(5)(B), substituted "provisions of the Federal Acquisition Regulation" for "regulations of the Secretary of Defense". Subsec. (e)(1)(M). Pub. L. 103-355, Sec. 2101(a)(5)(C), substituted "the Federal Acquisition Regulation" for "regulations prescribed by the Secretary of Defense". Subsec. (e)(2)(A). Pub. L. 103-355, Sec. 2101(a)(5)(D), substituted "the Secretary of Defense may provide" for "the Secretary may provide". Subsec. (e)(2)(C). Pub. L. 103-355, Sec. 2101(a)(5)(E), substituted "Secretary of Defense" for "head of the agency". Subsec. (e)(3)(A). Pub. L. 103-355, Sec. 2101(a)(5)(F), substituted "the Federal Acquisition Regulation" for "regulations prescribed by the Secretary". Subsec. (e)(4). Pub. L. 103-355, Sec. 2101(a)(5)(G), amended par. (4) generally. Prior to amendment, par. (4) read as follows: "The Secretary shall prescribe regulations to implement this section. Such regulations may establish appropriate definitions, exclusions, limitations, and qualifications." Subsec. (f)(1). Pub. L. 103-355, Sec. 2101(a)(6)(A), inserted heading and substituted "(1) The Federal Acquisition Regulation shall contain provisions on the allowability of contractor costs. Such provisions" for "(1) The Secretary shall prescribe proposed regulations to amend those provisions of the Department of Defense Supplement to the Federal Acquisition Regulation dealing with the allowability of contractor costs. The amendments" and "The regulations" for "These regulations". Subsec. (f)(1)(Q). Pub. L. 103-355, Sec. 2101(c), added subpar. (Q). Subsec. (f)(2). Pub. L. 103-355, Sec. 2101(a)(6)(B)(ii), as amended by Pub. L. 104-106, Sec. 4321(a)(5), substituted "Federal Acquisition Regulation" for "regulations". Subsec. (f)(2)(B). Pub. L. 103-355, Sec. 2101(a)(6)(B)(i), struck out "defense" before "contract auditor". Subsec. (f)(3). Pub. L. 103-355, Sec. 2101(a)(6)(B)(ii), as amended by Pub. L. 104-106, Sec. 4321(a)(5), substituted "Federal Acquisition Regulation" for "regulations". Pub. L. 103-355, Sec. 2101(a)(6)(B)(i), struck out "defense" before "contract auditor". Subsec. (f)(4). Pub. L. 103-355, Sec. 2101(a)(6)(B)(ii), as amended by Pub. L. 104-106, Sec. 4321(a)(5), substituted "Federal Acquisition Regulation" for "regulations". Pub. L. 103-355, Sec. 2101(a)(6)(B)(i), struck out "defense" before "contract auditor". Subsec. (g). Pub. L. 103-355, Sec. 2101(a)(7), amended subsec. (g) generally. Prior to amendment, subsec. (g) read as follows: "The regulations of the Secretary required to be prescribed under subsections (e) and (f)(1) shall require, to the maximum extent practicable, that such regulations apply to all subcontractors of a covered contract." Subsec. (h). Pub. L. 103-355, Sec. 2101(a)(8), inserted heading and substituted "in the Federal Acquisition Regulation" for "by the Secretary" in par. (1) and "head of the agency" for "Secretary of Defense" in introductory provisions of par. (2). Subsec. (i). Pub. L. 103-355, Sec. 2101(a)(9), inserted heading and substituted "The submission to an agency" for "The submission to the Department of Defense". Subsec. (j). Pub. L. 103-355, Sec. 2101(a)(10), inserted heading and substituted "United States Court of Federal Claims" for "United States Claims Court". Subsec. (k). Pub. L. 103-355, Sec. 2101(a)(11)(A), inserted heading. Subsec. (k)(2)(D). Pub. L. 103-355, Sec. 2101(a)(11)(B), struck out "by the Department of Defense" after "decision" in introductory provisions. Subsec. (k)(4). Pub. L. 103-355, Sec. 2101(a)(11)(C), inserted "or Secretary of the military department concerned" after "head of the agency", "or Secretary" after "agency head", and "or military department" before period at end and substituted "in accordance with the Federal Acquisition Regulation" for "under regulations prescribed by such agency head". Subsec. (l). Pub. L. 103-355, Sec. 2101(d), added subsec. (l) and struck out former subsec. (l) which related to periodic evaluation by Comptroller General of implementation of this section by Secretary of Defense. Subsec. (m). Pub. L. 103-355, Sec. 2101(d), struck out subsec. (m) which read as follows: "In this section, the term 'covered contract' means a contract for an amount more than $100,000 entered into by the Department of Defense other than a fixed-price contract without cost incentives." 1992 - Subsec. (a). Pub. L. 102-484, Sec. 818(a)(1)(A), redesignated subsec. (a)(1) as entire subsection. Former subsec. (a)(2) redesignated subsec. (b)(1). Subsec. (b)(1). Pub. L. 102-484, Sec. 818(a)(1)(B), redesignated subsec. (a)(2) as subsec. (b)(1), in introductory provisions struck out "by clear and convincing evidence" after "Secretary determines" and substituted "expressly unallowable under a cost principle referred to in subsection (a) that defines the allowability of specific selected costs" for "unallowable under paragraph (1)", and in subpar. (A), substituted "cost allocated to covered contracts for which a proposal for settlement of indirect costs has been submitted" for "costs". Former subsec. (b) redesignated subsec. (b)(2). Subsec. (b)(2). Pub. L. 102-484, Sec. 818(a)(2), redesignated subsec. (b) as subsec. (b)(2), struck out ", in addition to the penalty assessed under subsection (a)," after "against the contractor", and substituted "the amount of the disallowed cost allocated to covered contracts for which a proposal for settlement of indirect costs has been submitted" for "the amount of such cost". Subsec. (c). Pub. L. 102-484, Sec. 818(a)(5), added subsec. (c). Former subsec. (c) redesignated (d). Subsec. (d). Pub. L. 102-484, Sec. 818(a)(3), (4), redesignated subsec. (c) as (d) and struck out former subsec. (d) which read as follows: "If any penalty is assessed under subsection (a) or (b) with respect to a proposal for settlement of indirect costs, the Secretary may assess an additional penalty of not more than $10,000 per proposal." Subsec. (e)(3), (4). Pub. L. 102-484, Sec. 1352(b), added par. (3) and redesignated former par. (3) as (4). Subsec. (f)(5). Pub. L. 102-484, Sec. 1052(26)(A), struck out par. (5) which read as follows: "The regulations shall provide that costs to promote the export of products of the United States defense industry, including costs of exhibiting or demonstrating products, shall be allowable to the extent that such costs - "(A) are allocable, reasonable, and not otherwise unallowable; "(B) with respect to the activities of the business segment to which such costs are being allocated, are determined by the Secretary of Defense to be likely to result in future cost advantages to the United States; and "(C) with respect to a business segment which allocates to Department of Defense contracts $2,500,000 or more of such costs in any fiscal year of such business segment, are not in excess of the amount equal to 110 percent of such costs incurred by such business segment in the previous fiscal year." Subsec. (l)(2). Pub. L. 102-484, Sec. 1052(26)(B)(i), substituted "paragraph (3)" for "subsection (e)(2)(C)". Subsec. (l)(3). Pub. L. 102-484, Sec. 1052(26)(B)(ii), added par. (3). 1991 - Subsec. (e)(2), (3). Pub. L. 102-190 added par. (2) and redesignated former par. (2) as (3). 1990 - Subsec. (e)(2). Pub. L. 101-510 struck out "(A)" before "The Secretary" and struck out subpars. (B) and (C) which read as follows: "(B) The Secretary shall submit to the committees named in subparagraph (C) any proposed regulations that would make substantive changes to regulations prescribed under the second sentence of subparagraph (A) before the publication of such proposed regulations in accordance with section 22 of the Office of Federal Procurement Policy Act (41 U.S.C. 418b). "(C) The committees named in this subparagraph are - "(i) the Committees on Armed Services and on Government Operations of the House of Representatives; and "(ii) the Committees on Armed Services and on Governmental Affairs of the Senate." 1989 - Subsec. (e)(1)(N), (O). Pub. L. 101-189, Sec. 311(a)(1), added subpar. (N) and redesignated former subpar. (N) as (O). Subsec. (k)(5)(B)(i). Pub. L. 101-189, Sec. 853(b)(3), substituted "the Federal Acquisition Regulation" for "the single Government-wide procurement regulation issued pursuant to section 4(4)(A) of the Office of Federal Procurement Policy Act (41 U.S.C. 403(4)(A))". Subsec. (k)(6). Pub. L. 101-189, Sec. 853(a)(1)(A), designated par. (2) of subsec. (l), set out first, as subsec. (k)(6) and substituted "In this subsection:" for "In subsection (k):" in introductory provisions. Subsec. (l). Pub. L. 101-189, Sec. 853(a)(1)(A), (C), restored the text of subsec. (k) as in effect prior to being struck out by Pub. L. 100-700, Sec. 8(b)(2) (see 1988 Amendment note below), designated such text as subsec. (l), and struck out former subsec. (l)(1), set out first, which defined "covered contract". Former subsec. (l)(2), set out first, was redesignated subsec. (k)(6). Former subsec. (l), set out second, was redesignated (m). Subsec. (m). Pub. L. 101-189, Sec. 853(a)(1)(B), redesignated subsec. (l), set out second, as (m). 1988 - Subsec. (e)(1)(L). Pub. L. 100-370, Sec. 1(f)(2)(A), added subpar. (L). Subsec. (e)(1)(M). Pub. L. 100-456, Sec. 322(a), added subpar. (M). Subsec. (e)(1)(N). Pub. L. 100-700, Sec. 8(b)(1)(A), which directed amendment of subsec. (e) by striking out subpar. (N) and inserting in lieu thereof a new subpar. (N), was executed to subsec. (e)(1)(N) of this section as the probable intent of Congress. Former subpar. (N) read as follows: "Except as provided in paragraph (2), costs incurred in connection with any civil, criminal, or administrative action brought by the United States that results in a determination that a contractor has violated or failed to comply with any Federal law or regulation if the action results in any of the following: "(i) In the case of a criminal action, a conviction (including a conviction pursuant to a plea of nolo contendere). "(ii) In the case of a civil or administrative action, (I) a determination by the Secretary of Defense that the violation or failure to comply was knowing or willful, and (II) the imposition of a monetary penalty. "(iii) A final decision by an appropriate official of the Department of Defense to debar or suspend the contractor or to rescind, void, or terminate a contract awarded to such contractor if such decision is based on a determination by the Secretary of Defense that the violation or failure to comply was knowing or willful." Pub. L. 100-456, Sec. 832(a)(1), added subpar. (N). Subsec. (e)(2), (3). Pub. L. 100-700, Sec. 8(b)(1)(B), (C), redesignated par. (3) as (2) and struck out former par. (2) which read as follows: "If a civil, criminal, or administrative action referred to in paragraph (1)(N) is resolved by consent or compromise pursuant to an agreement entered into by a contractor and the United States, the contractor's costs that are otherwise not allowable under paragraph (1)(N) may be allowed to the extent provided in such agreement." Pub. L. 100-456, Sec. 832(a)(2), (3), added par. (2) and redesignated former par. (2) as (3). Subsec. (f)(5). Pub. L. 100-463, Sec. 8105(a), and Pub. L. 100- 456, Sec. 826(a), amended section identically, temporarily adding par. (5). Pub. L. 100-526 provided that Pub. L. 100-463, Sec. 8105, and amendment made by that section shall cease to be effective. See Effective and Termination Dates of 1988 Amendment note below. Subsec. (j). Pub. L. 100-370, Sec. 1(f)(3)(A)(ii), added subsec. (j). Former subsec. (j) redesignated (k). Subsec. (k). Pub. L. 100-700, Sec. 8(b)(2), added subsec. (k), and struck out former subsec. (k), the text of which was restored and redesignated subsec. (l) by Pub. L. 101-189, Sec. 853(a)(1)(C). See 1989 Amendment note above. Pub. L. 100-370, Sec. 1(f)(3)(A)(i), redesignated subsec. (j) as (k). Former subsec. (k) redesignated (l). Subsec. (l). Pub. L. 100-700, Sec. 8(b)(2), added subsec. (l) defining terms "covered contract", "proceeding", "costs", and "penalty". Pub. L. 100-370, Sec. 1(f)(3)(A)(i), redesignated subsec. (k) as (l). 1987 - Subsec. (e)(1)(K). Pub. L. 100-180 added subpar. (K). Subsec. (k). Pub. L. 100-26 inserted "the term" after "In this section,". 1985 - Subsec. (e)(2). Pub. L. 99-190, Sec. 101(b) [Sec. 8112(a)(1)], designated existing provisions as subpar. (A) and added subpars. (B) and (C). Subsec. (h)(2). Pub. L. 99-190, Sec. 101(b) [Sec. 8112(a)(2)], inserted ", in an exceptional case," in provisions preceding subpar. (A). Subsecs. (j), (k). Pub. L. 99-190, Sec. 101(b) [Sec. 8112(a)(3)], added subsec. (j) and redesignated former subsec. (j) as (k). EFFECTIVE DATE OF 2011 AMENDMENT Pub. L. 112-81, div. A, title VIII, Sec. 803(c), Dec. 31, 2011, 125 Stat. 1485, provided that: "The amendments made by this section [amending this section] - "(1) shall be implemented in the Federal Acquisition Regulation within 180 days after the date of the enactment of this Act [Dec. 31, 2011]; and "(2) shall apply with respect to costs of compensation incurred after January 1, 2012, under contracts entered into before, on, or after the date of the enactment of this Act." EFFECTIVE DATE OF 1998 AMENDMENT Pub. L. 105-261, div. A, title VIII, Sec. 804(d), Oct. 17, 1998, 112 Stat. 2083, provided that: "The amendments made by this section [amending this section, sections 256 and 435 of Title 41, Public Contracts, and provisions set out as a note under section 435 of Title 41] shall apply with respect to costs of compensation of senior executives incurred after January 1, 1999, under covered contracts (as defined in section 2324(l) of title 10, United States Code, and section 306(l) of the Federal Property and Administrative Services Act of 1949 ([former] 41 U.S.C.256(l))[)] [now 41 U.S.C. 4301(2), 4302] entered into before, on, or after the date of the enactment of this Act [Oct. 17, 1998]." EFFECTIVE DATE OF 1997 AMENDMENT Pub. L. 105-85, div. A, title VIII, Sec. 808(e), Nov. 18, 1997, 111 Stat. 1838, provided that: "The amendments made by this section [see Tables for classification] shall - "(1) take effect on the date that is 90 days after the date of the enactment of this Act [Nov. 18, 1997]; and "(2) apply with respect to costs of compensation incurred after January 1, 1998, under covered contracts entered into before, on, or after the date of the enactment of this Act." EFFECTIVE DATE OF 1996 AMENDMENT Section 4321(a) of Pub. L. 104-106 provided that the amendment made by that section is effective as of Oct. 13, 1994, and as if included in Pub. L. 103-355 as enacted. For effective date and applicability of amendment by section 4321(b)(9) of Pub. L. 104-106, see section 4401 of Pub. L. 104-106, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1994 AMENDMENT For effective date and applicability of amendment by Pub. L. 103- 355, see section 10001 of Pub. L. 103-355, set out as a note under section 2302 of this title. EFFECTIVE DATE OF 1992 AMENDMENTS Amendment by Pub. L. 102-572 effective Oct. 29, 1992, see section 911 of Pub. L. 102-572, set out as a note under section 171 of Title 28, Judiciary and Judicial Procedure. Section 818(b) of Pub. L. 102-484 provided that: "The amendments made by subsection (a) [amending this section] shall take effect on the date of the enactment of this Act [Oct. 23, 1992] and shall apply, as provided in regulations prescribed by the Secretary of Defense, with respect to proposals for settlement of indirect costs for which the Federal Government has not formally initiated an audit before that date." Section 1352(c) of Pub. L. 102-484 provided that: "The amendments made by subsection (b) [amending this section] apply to covered contracts (as defined in section 2324 of title 10, United States Code) that are in effect or are entered into on or after October 1, 1991, for costs incurred on or after October 1, 1991." EFFECTIVE DATE OF 1991 AMENDMENT Section 346(b) of Pub. L. 102-190 provided that: "The amendments made by subsection (a) [amending this section] shall not apply with respect to a foreign national whose employment under a military banking contract (defined in section 2324(e)(2)(B) of title 10, United States Code, as added by subsection (a)) was terminated before the date of the enactment of this Act [Dec. 5, 1991]." EFFECTIVE DATE OF 1989 AMENDMENT Section 311(a)(2) of Pub. L. 101-189 provided that: "Subparagraph (N) of such subsection [10 U.S.C. 2324(e)(1)(N)], as added by paragraph (1), shall not apply with respect to the termination of the employment of a foreign national employed under any covered contract (as defined in subsection (l) of such section [10 U.S.C. 2324(l)]) if such termination is the result of the closing of, or the curtailment of activities at, a United States military facility in a foreign country pursuant to an agreement entered into with the government of that country before the date of the enactment of this Act [Nov. 29, 1989]." Section 853(a)(3) of Pub. L. 101-189 provided that: "The amendments made by this subsection [amending this section and provisions set out as a note below] shall take effect as of November 19, 1988." EFFECTIVE AND TERMINATION DATES OF 1988 AMENDMENTS Section 8(e) of Pub. L. 100-700 provided that: "The amendments made by subsections (a) and (b) [enacting section 256 of Title 41, Public Contracts, and amending this section] shall take effect with respect to contracts awarded after the date of the enactment of this Act [Nov. 19, 1988]." Section 8105(d) of Pub. L. 100-463 provided that subsec. (f)(5) of this section, as enacted by section 8105(a) of Pub. L. 100-463, would cease to be effective three years after Oct. 1, 1988. Section 106(a)(2) of Pub. L. 100-526 provided that section 8105 of Pub. L. 100-463 "and the amendment made by that section shall cease to be effective". Section 322(b) of Pub. L. 100-456 provided that: "Subparagraph (M) of section 2324(e)(1) of title 10, United States Code, as added by subsection (a), shall apply with respect to any contract entered into after the end of the 180-day period beginning on the date of the enactment of this Act [Sept. 29, 1988]." Section 826(d) of Pub. L. 100-456, as amended by Pub. L. 100-526, title I, Sec. 106(a)(1)(B), Oct. 24, 1988, 102 Stat. 2625, provided that: "Section 2324(f)(5) of title 10, United States Code (as added by subsection (a)), shall cease to be effective on September 30, 1991." EFFECTIVE DATE OF 1987 AMENDMENT Section 805(b) of Pub. L. 100-180 provided that: "Subparagraph (K) of section 2324(e)(1) of title 10, United States Code, as added by subsection (a), shall apply to any contract entered into after the end of the 120-day period beginning on the date of the enactment of this Act [Dec. 4, 1987]." EFFECTIVE DATE Section 911(c) of Pub. L. 99-145 provided that: "Section 2324 of title 10, United States Code, as added by subsection (a), shall apply only to contracts for which solicitations are issued on or after the date on which such regulations are prescribed." REGULATIONS Section 2101(e) of Pub. L. 103-355 provided that: "The regulations of the Secretary of Defense implementing section 2324 of title 10, United States Code, shall remain in effect until the Federal Acquisition Regulation is revised to implement the amendments made by this section [amending this section]." Pub. L. 100-700, Sec. 8(d), Nov. 19, 1988, 102 Stat. 4638, provided that: "The regulations necessary for the implementation of section 306(e) of the Federal Property and Administrative Services Act of 1949 [now 41 U.S.C. 4304] (as added by subsection (a)) and section 2324(k)(5) of title 10, United States Code (as added by subsection (b)) - "(1) shall be prescribed not later than 120 days after the date of the enactment of this Act [Nov. 19, 1988]; and "(2) shall apply to contracts entered into more than 30 days after the date on which such regulations are issued." Section 8105(b), (c) of Pub. L. 100-463 provided for the promulgation of regulations and the preparation of a report in connection with the operation of subsec. (f)(5), as enacted by section 8105(a) of Pub. L. 100-463. Section 106(a)(2) of Pub. L. 100-526 provided that section 8105 of Pub. L. 100-463 "and the amendment made by that section shall cease to be effective". Section 826(b) of Pub. L. 100-456 provided that: "The Secretary of Defense shall prescribe final regulations under paragraph (5) of section 2324(f) of title 10, United States Code (as added by subsection (a)), not later than 90 days after the date of the enactment of this Act [Sept. 29, 1988]. Such regulations shall apply with respect to costs referred to in such paragraph that are incurred by a Department of Defense contractor (or a subcontractor of such a contractor) on or after the first day of the contractor's (or subcontractor's) first fiscal year that begins on or after the date on which such final regulations are prescribed." Section 832(b) of Pub. L. 100-456 related to regulations for the implementation of subsec. (e)(1)(N) of this section, prior to repeal by Pub. L. 100-700, Sec. 8(c), Nov. 19, 1988, 102 Stat. 4638. Pub. L. 99-190, 101(b) [title VIII, Sec. 8112(b), (c)], Dec. 19, 1985, 99 Stat. 1185, 1223, required the regulations required under section 911(b) of Pub. L. 99-145, set out below, to be submitted to Congress before the publication of such regulations in accordance with former 41 U.S.C. 418b (now 41 U.S.C. 1707) and directed the Comptroller General, within 180 days of publication of the regulations, to submit to Congress a report on the Comptroller General's initial evaluation under subsection (j)(1) of this section. Pub. L. 99-145, title IX, Sec. 911(b), Nov. 8, 1985, 99 Stat. 685, provided that: "(1) Not later than 150 days after the date of the enactment of this Act [Nov. 8, 1985], the Secretary of Defense shall prescribe the regulations required by subsections (e) and (f) of section 2324 of title 10, United States Code, as added by subsection (a). Such regulations shall be published in accordance with section 22 of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 418b) [now 41 U.S.C. 1707]. "(2) The Secretary shall review such regulations at least once every five years. The results of each such review shall be made public." -TRANS- TRANSFER OF FUNCTIONS For transfer of authorities, functions, personnel, and assets of the Coast Guard, including the authorities and functions of the Secretary of Transportation relating thereto, to the Department of Homeland Security, and for treatment of related references, see sections 468(b), 551(d), 552(d), and 557 of Title 6, Domestic Security, and the Department of Homeland Security Reorganization Plan of November 25, 2002, as modified, set out as a note under section 542 of Title 6. -MISC3- REPORT AND REGULATIONS ON EXCESSIVE PASS-THROUGH CHARGES Pub. L. 109-364, div. A, title VIII, Sec. 852, Oct. 17, 2006, 120 Stat. 2340, provided that: "(a) Comptroller General Report on Excessive Pass-Through Charges. - "(1) In general. - Not later than 180 days after the date of the enactment of this Act [Oct. 17, 2006], the Comptroller General shall issue a report on pass-through charges on contracts or subcontracts (or task or delivery orders) that are entered into for or on behalf of the Department of Defense. "(2) Matters covered. - The report issued under this subsection - "(A) shall assess the extent to which the Department of Defense has paid excessive pass-through charges to contractors who provided little or no value to the performance of the contract; "(B) shall assess the extent to which the Department has been particularly vulnerable to excessive pass-through charges on any specific category of contracts or by any specific category of contractors (including any category of small business); and "(C) shall determine the extent to which any prohibition on excessive pass-through charges would be inconsistent with existing commercial practices for any specific category of contracts or have an unjustified adverse effect on any specific category of contractors (including any category of small business). "(b) Regulations Required. - "(1) In general. - Not later than May 1, 2007, the Secretary of Defense shall prescribe regulations to ensure that pass-through charges on contracts or subcontracts (or task or delivery orders) that are entered into for or on behalf of the Department of Defense are not excessive in relation to the cost of work performed by the relevant contractor or subcontractor. "(2) Scope of regulations. - The regulations prescribed under this subsection - "(A) shall not apply to any firm, fixed-price contract or subcontract (or task or delivery order) that is - "(i) awarded on the basis of adequate price competition; or "(ii) for the acquisition of a commercial item, as defined in section 4(12) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 403(12)) [see 41 U.S.C. 103]; and "(B) may include such additional exceptions as the Secretary determines to be necessary in the interest of the national defense. "(3) Definition. - In this section, the term 'excessive pass- through charge', with respect to a contractor or subcontractor that adds no, or negligible, value to a contract or subcontract, means a charge to the Government by the contractor or subcontractor that is for overhead or profit on work performed by a lower-tier contractor or subcontractor (other than charges for the direct costs of managing lower-tier contracts and subcontracts and overhead and profit based on such direct costs). "(4) Report. - Not later than one year after the date of the enactment of this Act [Oct. 17, 2006], the Secretary of Defense shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report on the steps taken to implement the requirements of this subsection, including - "(A) any standards for determining when no, or negligible, value has been added to a contract by a contractor or subcontractor; "(B) any procedures established for preventing excessive pass- through charges; and "(C) any exceptions determined by the Secretary to be necessary in the interest of the national defense. "(5) Effective date. - The regulations prescribed under this subsection shall apply to contracts awarded for or on behalf of the Department of Defense on or after May 1, 2007." PAYMENT OF RESTRUCTURING COSTS UNDER DEFENSE CONTRACTS Pub. L. 103-337, div. A, title VIII, Sec. 818, Oct. 5, 1994, 108 Stat. 2821, as amended by Pub. L. 105-85, div. A, title VIII, Sec. 804(d), Nov. 18, 1997, 111 Stat. 1834, provided that: "[(a) Repealed. Pub. L. 105-85, div. A, title VIII, Sec. 804(d), Nov. 18, 1997, 111 Stat. 1834.] "(b) Requirement for Regulations. - Not later than January 1, 1995, the Secretary of Defense shall prescribe regulations on the allowability of restructuring costs associated with business combinations under defense contracts. "(c) Matters To Be Included. - At a minimum, the regulations shall - "(1) include a definition of the term 'restructuring costs'; and "(2) address the issue of contract novations under such contracts. "(d) Consultation. - In developing the regulations, the Secretary of Defense shall consult with the Administrator for Federal Procurement Policy. "(e) Report. - Not later than November 13 in each of the years 1995, 1996, and 1997, the Secretary of Defense shall submit to Congress a report on the following: "(1) A description of the procedures being followed within the Department of Defense for evaluating projected costs and savings under a defense contract resulting from a restructuring of a defense contractor associated with a business combination. "(2) A list of all defense contractors for which restructuring costs have been allowed by the Department, along with the identities of the firms which those contractors have acquired or with which those contractors have combined since July 21, 1993, that qualify the contractors for such restructuring reimbursement. "(3) The Department's experience with business combinations for which the Department has agreed to allow restructuring costs since July 21, 1993, including the following: "(A) The estimated amount of costs associated with each restructuring that have been or will be treated as allowable costs under defense contracts, including the type and amounts of costs that would not have arisen absent the business combination. "(B) The estimated amount of savings associated with each restructuring that are expected to be achieved on defense contracts. "(C) The types of documentation relied on to establish that savings associated with each restructuring will exceed costs associated with the restructuring. "(D) Actual experience on whether savings associated with each restructuring are exceeding costs associated with the restructuring. "(E) Identification of any programmatic or budgetary disruption in the Department of Defense resulting from contractor restructuring. "(f) Definition. - In this section, the term 'business combination' includes a merger or acquisition. "(g) Comptroller General Reports. - (1) Not later than March 1, 1995, the Comptroller General shall submit to Congress a report on the adequacy of the regulations prescribed under subsection (b) with respect to - "(A) whether such regulations are consistent with the purposes of this section, other applicable law, and the Federal Acquisition Regulation; and "(B) whether such regulations establish policies, procedures, and standards to ensure that restructuring costs are paid only when in the best interests of the United States. "(2) The Comptroller General shall report periodically to Congress on the implementation of the policy of the Department of Defense regarding defense industry restructuring." REIMBURSEMENT OF INDIRECT COSTS OF INSTITUTIONS OF HIGHER EDUCATION UNDER DEPARTMENT OF DEFENSE CONTRACTS Pub. L. 103-160, div. A, title VIII, Sec. 841, Nov. 30, 1993, 107 Stat. 1719, as amended by Pub. L. 105-244, title I, Sec. 102(a)(2)(C), Oct. 7, 1998, 112 Stat. 1617, provided that: "(a) Prohibition. - The Secretary of Defense may not by regulation place a limitation on the amount that the Department of Defense may reimburse an institution of higher education for allowable indirect costs incurred by the institution for work performed for the Department of Defense under a Department of Defense contract unless that same limitation is applied uniformly to all other organizations performing similar work for the Department of Defense under Department of Defense contracts. "(b) Waiver. - The Secretary of Defense may waive the application of the prohibition in subsection (a) in the case of a particular institution of higher education if the governing body of the institution requests the waiver in order to simplify the overall management by that institution of cost reimbursements by the Department of Defense for contracts awarded by the Department to the institution. "(c) Definitions. - In this section: "(1) The term 'allowable indirect costs' means costs that are generally considered allowable as indirect costs under regulations that establish the cost reimbursement principles applicable to an institution of higher education for purposes of Department of Defense contracts. "(2) The term 'institution of higher education' has the meaning given such term in section 101 of the Higher Education Act of 1965 [20 U.S.C. 1001]." ASSESSMENT OF REGULATIONS RELATING TO ALLOWABILITY OF COSTS TO PROMOTE EXPORT OF DEFENSE PRODUCTS; REPORT TO CONGRESS Section 826(c) of Pub. L. 100-456, as amended by Pub. L. 100-526, title I, Sec. 106(a)(1)(A), Oct. 24, 1988, 102 Stat. 2625, directed Comptroller General of United States and Inspector General of Department of Defense, not later than 2 years after Sept. 29, 1988, to submit to Congress a report including an assessment of whether the regulations required by subsec. (f)(5) of this section provide the appropriate incentives to stimulate exports by the United States defense industry and provide cost savings to the United States and whether such regulations provide appropriate criteria to ensure that costs allowed are reasonably likely to provide future cost savings to the United States. AIR TRAVEL EXPENSES OF DEFENSE CONTRACTOR PERSONNEL Pub. L. 100-456, div. A, title VIII, Sec. 833, Sept. 29, 1988, 102 Stat. 2024, as amended by Pub. L. 101-189, div. A, title VIII, Sec. 853(a)(2), Nov. 29, 1989, 103 Stat. 1518, directed the Administrator of General Services to enter into negotiations with commercial air carriers for agreements that would permit personnel of contractors who were traveling solely in the performance of covered contracts to be transported by such carriers at the same discount rates as such carriers charged for travel by Federal Government employees traveling at Government expense, directed the Secretary of Defense, not later than 120 days after the first such agreement would go into effect, to prescribe regulations that would provide that costs in excess of the rates established under the agreement were not allowable if the rate had been available and travel could have reasonably been performed under the conditions required by the air carrier to qualify for such rate, and provided that section 833 of Pub. L. 100-456 would cease to be effective three years after Sept. 29, 1988. BURDEN OF PROOF IN GOVERNMENT CONTRACT DISPUTE RESOLUTION Section 933 of Pub. L. 99-145, which provided that in proceeding before the Armed Services Board of Contract Appeals, United States Claims Court, or any other Federal court in which reasonableness of indirect costs for which a contractor seeks reimbursement from Department of Defense is in issue, the burden of proof is upon the contractor to establish that such costs are reasonable, was repealed and restated in subsec. (j) of this section by Pub. L. 100- 370, Sec. 1(f)(3)(A)(ii), (B), July 19, 1988, 102 Stat. 846. -End- -CITE- 10 USC Sec. 2325 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2325. Restructuring costs -STATUTE- (a) Limitation on Payment of Restructuring Costs. - (1) The Secretary of Defense may not pay, under section 2324 of this title, a defense contractor for restructuring costs associated with a business combination of the contractor that occurs after November 18, 1997, unless the Secretary determines in writing either - (A) that the amount of projected savings for the Department of Defense associated with the restructuring will be at least twice the amount of the costs allowed; or (B) that the amount of projected savings for the Department of Defense associated with the restructuring will exceed the amount of the costs allowed and that the business combination will result in the preservation of a critical capability that otherwise might be lost to the Department. (2) The Secretary may not delegate the authority to make a determination under paragraph (1), with respect to a business combination, to an official of the Department of Defense - (A) below the level of an Assistant Secretary of Defense for cases in which the amount of restructuring costs is expected to exceed $25,000,000 over a 5-year period; or (B) below the level of the Director of the Defense Contract Management Agency for all other cases. (b) Report. - Not later than March 1 in each of 1998, 1999, 2000, 2001, and 2002, the Secretary of Defense shall submit to Congress a report that contains, with respect to business combinations occurring on or after August 15, 1994, the following: (1) For each defense contractor to which the Secretary has paid, under section 2324 of this title, restructuring costs associated with a business combination, a summary of the following: (A) An estimate of the amount of savings for the Department of Defense associated with the restructuring that has been realized as of the end of the preceding calendar year. (B) An estimate of the amount of savings for the Department of Defense associated with the restructuring that is expected to be achieved on defense contracts. (2) An identification of any business combination for which the Secretary has paid restructuring costs under section 2324 of this title during the preceding calendar year and, for each such business combination - (A) the supporting rationale for allowing such costs; (B) factual information associated with the determination made under subsection (a) with respect to such costs; and (C) a discussion of whether the business combination would have proceeded without the payment of restructuring costs by the Secretary. (3) For business combinations of major defense contractors that took place during the year preceding the year of the report - (A) an assessment of any potentially adverse effects that the business combinations could have on competition for Department of Defense contracts (including potential horizontal effects, vertical effects, and organizational conflicts of interest), the national technology and industrial base, or innovation in the defense industry; and (B) the actions taken to mitigate the potentially adverse effects. (c) Definition. - In this section, the term "business combination" includes a merger or acquisition. -SOURCE- (Added Pub. L. 105-85, div. A, title VIII, Sec. 804(a)(1), Nov. 18, 1997, 111 Stat. 1832; amended Pub. L. 106-65, div. A, title X, Sec. 1066(a)(19), Oct. 5, 1999, 113 Stat. 771; Pub. L. 108-375, div. A, title VIII, Sec. 819, Oct. 28, 2004, 118 Stat. 2016.) -MISC1- PRIOR PROVISIONS A prior section 2325, added Pub. L. 99-500, Sec. 101(c) [title X, Sec. 907(a)(1)], Oct. 18, 1986, 100 Stat. 1783-82, 1783-137, and Pub. L. 99-591, Sec. 101(c) [title X, Sec. 907(a)(1)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-137; Pub. L. 99-661, div. A, title IX, formerly title IV, Sec. 907(a)(1), Nov. 14, 1986, 100 Stat. 3917, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; amended Pub. L. 101-189, div. A, title XVI, Sec. 1622(c)(5), Nov. 29, 1989, 103 Stat. 1604; Pub. L. 101-510, div. A, title VIII, Sec. 810, Nov. 5, 1990, 104 Stat. 1595; Pub. L. 103-160, div. A, title IX, Sec. 904(d)(1), Nov. 30, 1993, 107 Stat. 1728, directed Secretary of Defense to ensure that requirements of Department of Defense with respect to procurement of supplies be stated in terms of functions to be performed, performance required, or essential physical characteristics, and related to preference for nondevelopmental items in procurement of supplies, prior to repeal by Pub. L. 103-355, title VIII, Sec. 8104(b)(1), Oct. 13, 1994, 108 Stat. 3391. See sections 2376 and 2377 of this title. Another prior section 2325 was renumbered section 2345 of this title. AMENDMENTS 2004 - Subsec. (a)(2). Pub. L. 108-375 substituted "paragraph (1), with respect to a business combination, to an official of the Department of Defense - " for "paragraph (1) to an official of the Department of Defense below the level of an Assistant Secretary of Defense." and added subpars. (A) and (B). 1999 - Subsec. (a)(1). Pub. L. 106-65 inserted "that occurs after November 18, 1997," after "of the contractor" in introductory provisions. EFFECTIVE DATE Section 804(c) of Pub. L. 105-85 provided that: "Section 2325(a) of title 10, United States Code, as added by subsection (a), shall apply with respect to business combinations that occur after the date of the enactment of this Act [Nov. 18, 1997]." GAO REPORTS Pub. L. 105-85, div. A, title VIII, Sec. 804(b), Nov. 18, 1997, 111 Stat. 1832, directed the Comptroller General, not later than Apr. 1, 1998, to identify major market areas affected by business combinations of defense contractors since Jan. 1, 1990, and develop a methodology for determining the savings from business combinations of defense contractors on the prices paid on particular defense contracts, and to submit to committees of Congress a report describing the changes in numbers of businesses competing for major defense contracts since Jan. 1, 1990; and directed the Comptroller General, not later than Dec. 1, 1998, to submit to committees of Congress a report containing updated information on restructuring costs of business combinations paid by the Department of Defense pursuant to certifications under Pub. L. 103-337, Sec. 818 (set out as a note under section 2324 of this title), savings realized by the Department of Defense as a result of the business combinations for which the payment of restructuring costs was so certified, and an assessment of the savings on the prices paid on a meaningful sample of defense contracts. -End- -CITE- 10 USC Sec. 2326 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2326. Undefinitized contractual actions: restrictions -STATUTE- (a) In General. - The head of an agency may not enter into an undefinitized contractual action unless the request to the head of the agency for authorization of the contractual action includes a description of the anticipated effect on requirements of the military department concerned if a delay is incurred for purposes of determining contractual terms, specifications, and price before performance is begun under the contractual action. (b) Limitations on Obligation of Funds. - (1) A contracting officer of the Department of Defense may not enter into an undefinitized contractual action unless the contractual action provides for agreement upon contractual terms, specifications, and price by the earlier of - (A) the end of the 180-day period beginning on the date on which the contractor submits a qualifying proposal to definitize the contractual terms, specifications, and price; or (B) the date on which the amount of funds obligated under the contractual action is equal to more than 50 percent of the negotiated overall ceiling price for the contractual action. (2) Except as provided in paragraph (3), the contracting officer for an undefinitized contractual action may not obligate with respect to such contractual action an amount that is equal to more than 50 percent of the negotiated overall ceiling price until the contractual terms, specifications, and price are definitized for such contractual action. (3) If a contractor submits a qualifying proposal (as defined in subsection (g)) to definitize an undefinitized contractual action before an amount equal to more than 50 percent of the negotiated overall ceiling price is obligated on such action, the contracting officer for such action may not obligate with respect to such contractual action an amount that is equal to more than 75 percent of the negotiated overall ceiling price until the contractual terms, specifications, and price are definitized for such contractual action. (4) The head of an agency may waive the provisions of this subsection with respect to a contract of that agency if that head of an agency determines that the waiver is necessary in order to support any of the following operations: (A) A contingency operation. (B) A humanitarian or peacekeeping operation. (5) This subsection does not apply to an undefinitized contractual action for the purchase of initial spares. (c) Inclusion of Non-Urgent Requirements. - Requirements for spare parts and support equipment that are not needed on an urgent basis may not be included in an undefinitized contractual action for spare parts and support equipment that are needed on an urgent basis unless the head of the agency approves such inclusion as being - (1) good business practice; and (2) in the best interests of the United States. (d) Modification of Scope. - The scope of an undefinitized contractual action under which performance has begun may not be modified unless the head of the agency approves such modification as being - (1) good business practice; and (2) in the best interests of the United States. (e) Allowable Profit. - The head of an agency shall ensure that the profit allowed on an undefinitized contractual action for which the final price is negotiated after a substantial portion of the performance required is completed reflects - (1) the possible reduced cost risk of the contractor with respect to costs incurred during performance of the contract before the final price is negotiated; and (2) the reduced cost risk of the contractor with respect to costs incurred during performance of the remaining portion of the contract. (f) Applicability. - This section does not apply to the Coast Guard or the National Aeronautics and Space Administration. (g) Definitions. - In this section: (1) The term "undefinitized contractual action" means a new procurement action entered into by the head of an agency for which the contractual terms, specifications, or price are not agreed upon before performance is begun under the action. Such term does not include contractual actions with respect to the following: (A) Foreign military sales. (B) Purchases in an amount not in excess of the amount of the simplified acquisition threshold. (C) Special access programs. (D) Congressionally mandated long-lead procurement contracts. (2) The term "qualifying proposal" means a proposal that contains sufficient information to enable the Department of Defense to conduct complete and meaningful audits of the information contained in the proposal and of any other information that the Department is entitled to review in connection with the contract, as determined by the contracting officer. -SOURCE- (Added Pub. L. 99-500, Sec. 101(c) [title X, Sec. 908(d)(1)(A)], Oct. 18, 1986, 100 Stat. 1783-82, 1783-140, and Pub. L. 99-591, Sec. 101(c) [title X, Sec. 908(d)(1)(A)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-140; Pub. L. 99-661, div. A, title IX, formerly title IV, Sec. 908(d)(1)(A), Nov. 14, 1986, 100 Stat. 3920, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; amended Pub. L. 101-189, div. A, title XVI, Sec. 1622(c)(6), Nov. 29, 1989, 103 Stat. 1604; Pub. L. 102-25, title VII, Sec. 701(d)(5), Apr. 6, 1991, 105 Stat. 114; Pub. L. 103-355, title I, Sec. 1505, Oct. 13, 1994, 108 Stat. 3298; Pub. L. 105-85, div. A, title VIII, Sec. 803(a), Nov. 18, 1997, 111 Stat. 1831.) -COD- CODIFICATION Pub. L. 99-591 is a corrected version of Pub. L. 99-500. Pub. L. 99-500, Pub. L. 99-591, and Pub. L. 99-661 added identical sections. -MISC1- PRIOR PROVISIONS A prior section 2326 was renumbered section 2346 of this title. AMENDMENTS 1997 - Subsec. (b)(4). Pub. L. 105-85 amended par. (4) generally. Prior to amendment, par. (4) read as follows: "The head of an agency may waive the provisions of this subsection with respect to a contract of that agency if such head of an agency determines that the waiver is necessary in order to support a contingency operation." 1994 - Subsec. (b). Pub. L. 103-355, Sec. 1505(a)(1), struck out "and expenditure" after "obligation" in heading. Subsec. (b)(1)(B). Pub. L. 103-355, Sec. 1505(a)(2), struck out "or expended" after "obligated". Subsec. (b)(2). Pub. L. 103-355, Sec. 1505(a)(3), substituted "obligate" for "expend". Subsec. (b)(3). Pub. L. 103-355, Sec. 1505(a)(4), substituted "obligated" for "expended" and "obligate" for "expend". Subsec. (b)(4), (5). Pub. L. 103-355, Sec. 1505(b), added par. (4) and redesignated former par. (4) as (5). Subsec. (g)(1)(B). Pub. L. 103-355, Sec. 1505(c), substituted "simplified acquisition threshold" for "small purchase threshold". 1991 - Subsec. (g)(1)(B). Pub. L. 102-25 substituted "in an amount not in excess of the amount of the small purchase threshold" for "of less than $25,000". 1989 - Subsec. (g)(1)(D). Pub. L. 101-189 substituted "Congressionally mandated" for "Congressionally-mandated". EFFECTIVE DATE OF 1994 AMENDMENT For effective date and applicability of amendment by Pub. L. 103- 355, see section 10001 of Pub. L. 103-355, set out as a note under section 2302 of this title. EFFECTIVE DATE Section 101(c) [title X, Sec. 908(d)(2)] of Pub. L. 99-500 and Pub. L. 99-591, and section 908(d)(2) of title IX, formerly title IV, of Pub. L. 99-661, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, provided that: "Section 2326 of title 10, United States Code (as added by subsection (d)(1)), applies to undefinitized contractual actions that are entered into after the end of the 180-day period beginning on the date of the enactment of this Act [Oct. 18, 1986]." -TRANS- TRANSFER OF FUNCTIONS For transfer of authorities, functions, personnel, and assets of the Coast Guard, including the authorities and functions of the Secretary of Transportation relating thereto, to the Department of Homeland Security, and for treatment of related references, see sections 468(b), 551(d), 552(d), and 557 of Title 6, Domestic Security, and the Department of Homeland Security Reorganization Plan of November 25, 2002, as modified, set out as a note under section 542 of Title 6. -MISC2- REVISION OF DEFENSE SUPPLEMENT RELATING TO PAYMENT OF COSTS PRIOR TO DEFINITIZATION Pub. L. 111-84, div. A, title VIII, Sec. 812, Oct. 28, 2009, 123 Stat. 2406, provided that: "(a) Revision Required. - Not later than 180 days after the date of the enactment of this Act [Oct. 28, 2009], the Secretary of Defense shall revise the Defense Supplement to the Federal Acquisition Regulation to ensure that any limitations described in subsection (b) are applicable to all categories of undefinitized contractual actions (including undefinitized task orders and delivery orders). "(b) Limitations. - The limitations referred to in subsection (a) are any limitations on the reimbursement of costs and the payment of profits or fees with respect to costs incurred before the definitization of an undefinitized contractual action of the Department of Defense, including - "(1) such limitations as described in part 52.216-26 of the Federal Acquisition Regulation; and "(2) any such limitations implementing the requirements of section 809 of the National Defense Authorization Act for Fiscal Year 2008 (Public Law 110-181; 10 U.S.C. 2326 note)." IMPLEMENTATION AND ENFORCEMENT OF REQUIREMENTS APPLICABLE TO UNDEFINITIZED CONTRACTUAL ACTIONS Pub. L. 110-181, div. A, title VIII, Sec. 809, Jan. 28, 2008, 122 Stat. 216, provided that: "(a) Guidance and Instructions. - Not later than 180 days after the date of the enactment of this Act [Jan. 28, 2008], the Secretary of Defense shall issue guidance, with detailed implementation instructions, for the Department of Defense to ensure the implementation and enforcement of requirements applicable to undefinitized contractual actions. "(b) Elements. - The guidance and instructions issued pursuant to subsection (a) shall address, at a minimum - "(1) the circumstances in which it is, and is not, appropriate for Department of Defense officials to use undefinitized contractual actions; "(2) approval requirements (including thresholds) for the use of undefinitized contractual actions; "(3) procedures for ensuring that timelines for the definitization of undefinitized contractual actions are met; "(4) procedures for ensuring compliance with regulatory limitations on the obligation of funds pursuant to undefinitized contractual actions; "(5) procedures for ensuring compliance with regulatory limitations on profit or fee with respect to costs incurred before the definitization of an undefinitized contractual action; and "(6) reporting requirements for undefinitized contractual actions that fail to meet required timelines for definitization or fail to comply with regulatory limitations on the obligation of funds or on profit or fee. "(c) Reports. - "(1) Report on guidance and instructions. - Not later than 210 days after the date of the enactment of this Act [Jan. 28, 2008], the Secretary of Defense shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report setting forth the guidance and instructions issued pursuant to subsection (a). "(2) GAO report. - Not later than two years after the date of the enactment of this Act, the Comptroller General of the United States shall submit to the congressional defense committees a report on the extent to which the guidance and instructions issued pursuant to subsection (a) have resulted in improvements to - "(A) the level of insight that senior Department of Defense officials have into the use of undefinitized contractual actions; "(B) the appropriate use of undefinitized contractual actions; "(C) the timely definitization of undefinitized contractual actions; and "(D) the negotiation of appropriate profits and fees for undefinitized contractual actions." LIMITATION ON USE OF FUNDS FOR UNDEFINITIZED CONTRACTUAL ACTIONS; OVERSIGHT BY INSPECTOR GENERAL; WAIVER AUTHORITY Section 101(c) [title X, Sec. 908(a)-(c), (e)] of Pub. L. 99-500 and Pub. L. 99-591, and section 908(a)-(c), (e) of title IX, formerly title IV, of Pub. L. 99-661; renumbered title IX and amended by Pub. L. 100-26, Secs. 3(5), 5(2), Apr. 21, 1987, 101 Stat. 273, 274; Pub. L. 104-106, div. D, title XLIII, Sec. 4322(b)(2), Feb. 10, 1996, 110 Stat. 677, provided that: "(a) Limitation on Use of Funds for Undefinitized Contractual Actions. - (1) On the last day of each six-month period described in paragraph (4), the Secretary of Defense (with respect to the Defense Logistics Agency) and the Secretary of each military department shall determine - "(A) the total amount of funds obligated for contractual actions during the six-month period; "(B) the total amount of funds obligated during the six-month period for undefinitized contractual actions; and "(C) the total amount of funds obligated during the six-month period for undefinitized contractual actions that are not definitized on or before the last day of such period. "(2) On the last day of each six-month period described in paragraph (4), the amount of funds obligated for undefinitized contractual actions entered into by the Secretary of Defense (with respect to the Defense Logistics Agency) or the Secretary of a military department during the six-month period that are not definitized on or before such day may not exceed 10 percent of the amount of funds obligated for all contractual actions entered into by the Secretary during the six-month period. "(3) If on the last day of a six-month period described in paragraph (4) the total amount of funds obligated for undefinitized contractual actions under the jurisdiction of a Secretary that were entered into during the six-month period exceeds the limit established in paragraph (2), the Secretary - "(A) shall, not later than the end of the 45-day period beginning on the first day following the six-month period, submit to the defense committees an unclassified report concerning - "(i) the amount of funds obligated for contractual actions under the jurisdiction of the Secretary that were entered into during the six-month period with respect to which the report is submitted; and "(ii) the amount of such funds obligated for undefinitized contractual actions; and "(B) except with respect to the six-month period described in paragraph (4)(A), may not enter into any additional undefinitized contractual actions until the date on which the Secretary certifies to Congress that such limit is not exceeded by the cumulative amount of funds obligated for undefinitized contractual actions under the jurisdiction of the Secretary that are not definitized on or before such date and were entered into - "(i) during the six-month period for which such limit was exceeded; or "(ii) after the end of such six-month period. "(4) This subsection applies to the following six-month periods: "(A) The period beginning on October 1, 1986, and ending on March 31, 1987. "(B) The period beginning on April 1, 1987, and ending on September 30, 1987. "(C) The period beginning on October 1, 1987, and ending on March 31, 1988. "(D) The period beginning on April 1, 1988, and ending on September 30, 1988. "(E) The period beginning on October 1, 1988, and ending on March 31, 1989. "(b) Oversight by Inspector General. - The Inspector General of the Department of Defense shall - "(1) periodically conduct an audit of contractual actions under the jurisdiction of the Secretary of Defense (with respect to the Defense Logistics Agency) and the Secretaries of the military departments; and "(2) after each audit, submit to Congress a report on the management of undefinitized contractual actions by each Secretary, including the amount of contractual actions under the jurisdiction of each Secretary that is represented by undefinitized contractual actions. "(c) Waiver Authority. - The Secretary of Defense may waive the application of subsections (a) and (b) for urgent and compelling considerations relating to national security or public safety if the Secretary notifies the Committees on Armed Services of the Senate and House of Representatives of such waiver before the end of the 30-day period beginning on the date that the waiver is made. "(e) Definition. - For purposes of this section, the term 'undefinitized contractual action' has the meaning given such term in section 2326(g) of title 10, United States Code (as added by subsection (d)(1))." -End- -CITE- 10 USC Sec. 2327 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2327. Contracts: consideration of national security objectives -STATUTE- (a) Disclosure of Ownership or Control by a Foreign Government. - The head of an agency shall require a firm or a subsidiary of a firm that submits a bid or proposal in response to a solicitation issued by the Department of Defense to disclose in that bid or proposal any significant interest in such firm or subsidiary (or, in the case of a subsidiary, in the firm that owns the subsidiary) that is owned or controlled (whether directly or indirectly) by a foreign government or an agent or instrumentality of a foreign government, if such foreign government is the government of a country that the Secretary of State determines under section 6(j)(1)(A) of the Export Administration Act of 1979 (50 U.S.C. App. 2405(j)(1)(A)) has repeatedly provided support for acts of international terrorism. (b) Prohibition on Entering Into Contracts Against the Interests of the United States. - Except as provided in subsection (c), the head of an agency may not enter into a contract with a firm or a subsidiary of a firm if - (1) a foreign government owns or controls (whether directly or indirectly) a significant interest in such firm or subsidiary (or, in the case of a subsidiary, in the firm that owns the subsidiary); and (2) such foreign government is the government of a country that the Secretary of State determines under section 6(j)(1)(A) of the Export Administration Act of 1979 (50 U.S.C. App. 2405(j)(1)(A)) has repeatedly provided support for acts of international terrorism. (c) Waiver. - (1)(A) If the Secretary of Defense determines under paragraph (2) that entering into a contract with a firm or a subsidiary of a firm described in subsection (b) is not inconsistent with the national security objectives of the United States, the head of an agency may enter into a contract with such firm or subsidiary if in the best interests of the Government. (B) The Secretary shall maintain records of each contract entered into by reason of subparagraph (A). Such records shall include the following: (i) The identity of the foreign government concerned. (ii) The nature of the contract. (iii) The extent of ownership or control of the firm or subsidiary concerned (or, if appropriate in the case of a subsidiary, of the firm that owns the subsidiary) by the foreign government concerned or the agency or instrumentality of such foreign government. (iv) The reasons for entering into the contract. (2) Upon the request of the head of an agency, the Secretary of Defense shall determine whether entering into a contract with a firm or subsidiary described in subsection (b) is inconsistent with the national security objectives of the United States. In making such a determination, the Secretary of Defense shall consider the following: (A) The relationship of the United States with the foreign government concerned. (B) The obligations of the United States under international agreements. (C) The extent of the ownership or control of the firm or subsidiary (or, if appropriate in the case of a subsidiary, of the firm that owns the subsidiary) by the foreign government or an agent or instrumentality of the foreign government. (D) Whether payments made, or information made available, to the firm or subsidiary under the contract could be used for purposes hostile to the interests of the United States. (d) List of Firms Subject to Prohibition. - (1) The Secretary of Defense shall develop and maintain a list of all firms and subsidiaries of firms that the Secretary has identified as being subject to the prohibition in subsection (b). (2)(A) A person may request the Secretary to include on the list maintained under paragraph (1) any firm or subsidiary of a firm that the person believes to be owned or controlled by a foreign government described in subsection (b)(2). Upon receipt of such a request, the Secretary shall determine whether the conditions in paragraphs (1) and (2) of subsection (b) exist in the case of that firm or subsidiary. If the Secretary determines that such conditions do exist, the Secretary shall include the firm or subsidiary on the list. (B) A firm or subsidiary of a firm included on the list may request the Secretary to remove such firm or subsidiary from the list on the basis that it has been erroneously included on the list or its ownership circumstances have significantly changed. Upon receipt of such a request, the Secretary shall determine whether the conditions in paragraphs (1) and (2) of subsection (b) exist in the case of that firm or subsidiary. If the Secretary determines that such conditions do not exist, the Secretary shall remove the firm or subsidiary from the list. (C) The Secretary shall establish procedures to carry out this paragraph. (3) The head of an agency shall prohibit each firm or subsidiary of a firm awarded a contract by the agency from entering into a subcontract under that contract in an amount in excess of $25,000 with a firm or subsidiary included on the list maintained under paragraph (1) unless there is a compelling reason to do so. In the case of any subcontract requiring consent by the head of an agency, the head of the agency shall not consent to the award of the subcontract to a firm or subsidiary included on such list unless there is a compelling reason for such approval. (e) Distribution of List. - The Administrator of General Services shall ensure that the list developed and maintained under subsection (d) is made available to Federal agencies and the public in the same manner and to the same extent as the list of suspended and debarred contractors compiled pursuant to subpart 9.4 of the Federal Acquisition Regulation. (f) Applicability. - (1) This section does not apply to a contract for an amount less than $100,000. (2) This section does not apply to the Coast Guard or the National Aeronautics and Space Administration. (g) Regulations. - The Secretary of Defense, after consultation with the Secretary of State, shall prescribe regulations to carry out this section. Such regulations shall include a definition of the term "significant interest". -SOURCE- (Added Pub. L. 99-500, Sec. 101(c) [title X, Sec. 951(a)(1)], Oct. 18, 1986, 100 Stat. 1783-82, 1783-164, and Pub. L. 99-591, Sec. 101(c) [title X, Sec. 951(a)(1)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-164; Pub. L. 99-661, div. A, title IX, formerly title IV, Sec. 951(a)(1), Nov. 14, 1986, 100 Stat. 3944, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; amended Pub. L. 100-180, div. A, title XII, Sec. 1231(8), Dec. 4, 1987, 101 Stat. 1160; Pub. L. 100-224, Sec. 5(b)(2), Dec. 30, 1987, 101 Stat. 1538; Pub. L. 105-85, div. A, title VIII, Sec. 843, Nov. 18, 1997, 111 Stat. 1844; Pub. L. 108-136, div. A, title X, Sec. 1031(a)(16), Nov. 24, 2003, 117 Stat. 1597.) -COD- CODIFICATION Pub. L. 99-591 is a corrected version of Pub. L. 99-500. Pub. L. 99-500, Pub. L. 99-591, and Pub. L. 99-661 added identical sections. -MISC1- PRIOR PROVISIONS A prior section 2327 was renumbered section 2347 of this title. AMENDMENTS 2003 - Subsec. (c)(1)(A). Pub. L. 108-136, Sec. 1031(a)(16)(A), substituted "if in the best interests of the Government" for "after the date on which such head of an agency submits to Congress a report on the contract". Subsec. (c)(1)(B). Pub. L. 108-136, Sec. 1031(a)(16)(B), substituted "The Secretary shall maintain records of each contract entered into by reason of subparagraph (A). Such records" for "A report under subparagraph (A)". Subsec. (c)(1)(C). Pub. L. 108-136, Sec. 1031(a)(16)(C), struck out subpar. (C) which read as follows: "After the head of an agency submits a report to Congress under subparagraph (A) with respect to a firm or a subsidiary, such head of an agency is not required to submit a report before entering into any subsequent contract with such firm or subsidiary unless the information required to be included in such report under subparagraph (B) has materially changed since the submission of the previous report." 1997 - Subsecs. (d) to (g). Pub. L. 105-85 added subsecs. (d) and (e) and redesignated former subsecs. (d) and (e) as (f) and (g), respectively. 1987 - Subsecs. (a), (b)(2). Pub. L. 100-224 substituted "50 U.S.C. App." for "50 U.S.C." in parenthetical after "Export Administration Act of 1979". Subsec. (d)(1). Pub. L. 100-180 inserted par. (1) designation. EFFECTIVE DATE Section 101(c) [title X, Sec. 951(c)] of Pub. L. 99-500 and Pub. L. 99-591, and section 951(c) of title IX, formerly title IV, of Pub. L. 99-661, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, provided that: "Section 2327 of title 10, United States Code (as added by subsection (a)(1)), shall apply to contracts entered into by the Secretary of Defense after the end of the 90-day period beginning on the date of the enactment of this Act [Oct. 18, 1986]." -TRANS- TRANSFER OF FUNCTIONS For transfer of authorities, functions, personnel, and assets of the Coast Guard, including the authorities and functions of the Secretary of Transportation relating thereto, to the Department of Homeland Security, and for treatment of related references, see sections 468(b), 551(d), 552(d), and 557 of Title 6, Domestic Security, and the Department of Homeland Security Reorganization Plan of November 25, 2002, as modified, set out as a note under section 542 of Title 6. -MISC2- REPORTS BY DEFENSE CONTRACTORS OF DEALINGS WITH TERRORIST COUNTRIES Pub. L. 103-160, div. A, title VIII, Sec. 843, Nov. 30, 1993, 107 Stat. 1720, as amended by Pub. L. 103-355, title VIII, Sec. 8105(j), Oct. 13, 1994, 108 Stat. 3393, directed the Secretary of Defense to require any person with whom the Secretary proposed to enter into a contract for the provision of goods or services in an amount in excess of $5,000,000, to report to the Secretary each commercial transaction which that person had conducted with the government of any terrorist country during the preceding three years and during the course of the contract, required the Secretary to prescribe regulations and to submit an annual report to Congress setting forth those commercial transactions with terrorist countries that had been included in the reports made during the preceding fiscal year, and provided that section 843 of Pub. L. 103- 160 would expire on Sept. 30, 1996. -End- -CITE- 10 USC Sec. 2328 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2328. Release of technical data under Freedom of Information Act: recovery of costs -STATUTE- (a) In General. - (1) The Secretary of Defense shall, if required to release technical data under section 552 of title 5 (relating to the Freedom of Information Act), release such technical data to the person requesting the release if the person pays all reasonable costs attributable to search, duplication, and review. (2) The Secretary of Defense shall prescribe regulations, pursuant to notice and receipt of public comment, specifying a uniform schedule of fees under this section. (b) Crediting of Receipts. - An amount received under this section - (1) shall be retained by the Department of Defense or the element of the Department of Defense receiving the amount; and (2) shall be merged with and available for the same purpose and the same time period as the appropriation from which the costs incurred in complying with requests for technical data were paid. (c) Waiver. - The Secretary of Defense shall waive the payment of costs required by subsection (a) which are in an amount greater than the costs that would be required for such a release of information under section 552 of title 5 if - (1) the request is made by a citizen of the United States or a United States corporation, and such citizen or corporation certifies that the technical data requested is required to enable such citizen or corporation to submit an offer or determine whether it is capable of submitting an offer to provide the product to which the technical data relates to the United States or a contractor with the United States (except that the Secretary may require the citizen or corporation to pay a deposit in an amount equal to not more than the cost of complying with the request, to be refunded upon submission of an offer by the citizen or corporation); (2) the release of technical data is requested in order to comply with the terms of an international agreement; or (3) the Secretary determines, in accordance with section 552(a)(4)(A)(iii) of title 5, that such a waiver is in the interests of the United States. -SOURCE- (Added Pub. L. 99-500, Sec. 101(c) [title X, Sec. 954(a)(1)], Oct. 18, 1986, 100 Stat. 1783-82, 1783-172, and Pub. L. 99-591, Sec. 101(c) [title X, Sec. 954(a)(1)], Oct. 30, 1986, 100 Stat. 3341-82, 3341-172; Pub. L. 99-661, div. A, title IX, formerly title IV, Sec. 954(a)(1), Nov. 14, 1986, 100 Stat. 3952, renumbered title IX, Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273; amended Pub. L. 100-26, Sec. 7(a)(7)(A), (B)(i), Apr. 21, 1987, 101 Stat. 278.) -COD- CODIFICATION Pub. L. 99-591 is a corrected version of Pub. L. 99-500. Pub. L. 99-500, Pub. L. 99-591, and Pub. L. 99-661 added identical sections. -MISC1- PRIOR PROVISIONS A prior section 2328 was renumbered section 2348 of this title. AMENDMENTS 1987 - Pub. L. 100-26, Sec. 7(a)(7)(B)(i), substituted "Release of technical data under Freedom of Information Act: recovery of costs" for "Release of technical data" in section catchline. Subsec. (a)(1). Pub. L. 100-26, Sec. 7(a)(7)(A)(i)(I), substituted "such technical data to the person requesting the" for "technical data to a person requesting such a". Pub. L. 100-26, Sec. 7(a)(7)(A)(i)(II), substituted "search, duplication, and review" for "search and duplication". Subsec. (b). Pub. L. 100-26, Sec. 7(a)(7)(A)(ii), substituted "Crediting of receipts" for "Disposition of costs" in heading. Subsec. (c)(3). Pub. L. 100-26, Sec. 7(a)(7)(A)(iii), substituted "section 552(a)(4)(A)(iii)" for "section 552(a)(4)(A)". EFFECTIVE DATE OF 1987 AMENDMENT Section 12(d)(2) of Pub. L. 100-26 provided that: "The amendment to section 2328 of such title made by section 7(a)(7)(A)(i)(II) shall take effect on the same date and in the same manner as provided in section 1804(b) of Public Law 99-570 [set out as an Effective Date of 1986 Amendment note under section 552 of Title 5, Government Organization and Employees] for the amendment made by section 1803 of that Public Law to section 552a of title 5, United States Code [probably means amendment by section 1803 of Pub. L. 99- 570 to section 552(a) of Title 5]." EFFECTIVE DATE Section 101(c) [title X, Sec. 954(b)] of Pub. L. 99-500 and Pub. L. 99-591, and section 954(b) of title IX, formerly title IV, of Pub. L. 99-661, renumbered title IX by Pub. L. 100-26, Sec. 3(5), Apr. 21, 1987, 101 Stat. 273, provided that: "The amendments made by this section [enacting this section] shall take effect at the end of the 90-day period beginning on the date of the enactment of this Act [Oct. 18, 1986]." -End- -CITE- 10 USC Sec. 2329 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2329. Repealed. -MISC1- [Sec. 2329. Repealed. Pub. L. 103-355, title I, Sec. 1506(a), Oct. 13, 1994, 108 Stat. 3298]. Section, added Pub. L. 100-180, div. A, title VIII, Sec. 810(a)(1), Dec. 4, 1987, 101 Stat. 1130; amended Pub. L. 100-456, div. A, title XII, Sec. 1233(j), Sept. 29, 1988, 102 Stat. 2058; Pub. L. 103-160, div. A, title IX, Sec. 904(d)(1), Nov. 30, 1993, 107 Stat. 1728, related to contract terms and conditions for production special tooling and production special test equipment. -End- -CITE- 10 USC Sec. 2330 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2330. Procurement of contract services: management structure -STATUTE- (a) Requirement for Management Structure. - The Secretary of Defense shall establish and implement a management structure for the procurement of contract services for the Department of Defense. The management structure shall provide, at a minimum, for the following: (1) The Under Secretary of Defense for Acquisition, Technology, and Logistics shall - (A) develop and maintain (in consultation with the service acquisition executives) policies, procedures, and best practices guidelines addressing the procurement of contract services, including policies, procedures, and best practices guidelines for - (i) acquisition planning; (ii) solicitation and contract award; (iii) requirements development and management; (iv) contract tracking and oversight; (v) performance evaluation; and (vi) risk management; (B) work with the service acquisition executives and other appropriate officials of the Department of Defense - (i) to identify the critical skills and competencies needed to carry out the procurement of contract services on behalf of the Department of Defense; (ii) to develop a comprehensive strategy for recruiting, training, and deploying employees to meet the requirements for such skills and competencies; and (iii) to ensure that the military departments and Defense Agencies have staff and administrative support that are adequate to effectively perform their duties under this section; (C) establish contract services acquisition categories, based on dollar thresholds, for the purpose of establishing the level of review, decision authority, and applicable procedures in such categories; and (D) oversee the implementation of the requirements of this section and the policies, procedures, and best practices guidelines established pursuant to subparagraph (A). (2) The service acquisition executive of each military department shall be the senior official responsible for the management of acquisition of contract services for or on behalf of the military department. (3) The Under Secretary of Defense for Acquisition, Technology, and Logistics shall be the senior official responsible for the management of acquisition of contract services for or on behalf of the Defense Agencies and other components of the Department of Defense outside the military departments. (b) Duties and Responsibilities of Senior Officials Responsible for the Management of Acquisition of Contract Services. - (1) Except as provided in paragraph (2), the senior officials responsible for the management of acquisition of contract services shall assign responsibility for the review and approval of procurements in each contract services acquisition category established under subsection (a)(1)(C) to specific Department of Defense officials, subject to the direction, supervision, and oversight of such senior officials. (2) With respect to the acquisition of contract services by a component or command of the Department of Defense the primary mission of which is the acquisition of products and services, such acquisition shall be conducted in accordance with policies, procedures, and best practices guidelines developed and maintained by the Under Secretary of Defense for Acquisition, Technology, and Logistics pursuant to subsection (a)(1), subject to oversight by the senior officials referred to in paragraph (1). (3) In carrying out paragraph (1), each senior official responsible for the management of acquisition of contract services shall - (A) implement the requirements of this section and the policies, procedures, and best practices guidelines developed by the Under Secretary of Defense for Acquisition, Technology, and Logistics pursuant to subsection (a)(1)(A); (B) authorize the procurement of contract services through contracts entered into by agencies outside the Department of Defense in appropriate circumstances, in accordance with the requirements of section 854 of the Ronald W. Reagan National Defense Authorization Act for Fiscal Year 2005 (10 U.S.C. 2304 note), section 814 of the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999 (31 U.S.C. 1535 note), and the regulations implementing such sections; (C) dedicate full-time commodity managers to coordinate the procurement of key categories of services; (D) ensure that contract services are procured by means of procurement actions that are in the best interests of the Department of Defense and are entered into and managed in compliance with applicable laws, regulations, directives, and requirements; (E) ensure that competitive procedures and performance-based contracting are used to the maximum extent practicable for the procurement of contract services; and (F) monitor data collection under section 2330a of this title, and periodically conduct spending analyses, to ensure that funds expended for the procurement of contract services are being expended in the most rational and economical manner practicable. (c) Definitions. - In this section: (1) The term "procurement action" includes the following actions: (A) Entry into a contract or any other form of agreement. (B) Issuance of a task order, delivery order, or military interdepartmental purchase request. (2) The term "contract services" includes all services acquired from private sector entities by or for the Department of Defense, other than services relating to research and development or military construction. -SOURCE- (Added Pub. L. 107-107, div. A, title VIII, Sec. 801(b)(1), Dec. 28, 2001, 115 Stat. 1174; amended Pub. L. 107-314, div. A, title X, Sec. 1062(a)(8), Dec. 2, 2002, 116 Stat. 2650; Pub. L. 109-163, div. A, title VIII, Sec. 812(a)(1), Jan. 6, 2006, 119 Stat. 3376.) -REFTEXT- REFERENCES IN TEXT Section 854 of the Ronald W. Reagan National Defense Authorization Act for Fiscal Year 2005, referred to in subsec. (b)(3)(B), is section 854 of div. A of Pub. L. 108-375, which is set out as a note under section 2304 of this title. Section 814 of the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999, referred to in subsec. (b)(3)(B), is section 814 of div. A of Pub. L. 105-261, which was formerly set out as a note under section 1535 of Title 31, Money and Finance. -MISC1- PRIOR PROVISIONS A prior section 2330, added Pub. L. 100-456, div. A, title VIII, Sec. 801(a)(1), Sept. 29, 1988, 102 Stat. 2007; amended Pub. L. 101- 510, div. A, title XIV, Sec. 1484(h)(2), Nov. 5, 1990, 104 Stat. 1717; Pub. L. 102-190, div. A, title VIII, Sec. 802(d), Dec. 5, 1991, 105 Stat. 1414, related to integrated financing policy, prior to repeal by Pub. L. 102-484, div. D, title XLII, Sec. 4271(a)(1), Oct. 23, 1992, 106 Stat. 2695. Another prior section 2330 was renumbered section 2349 of this title. AMENDMENTS 2006 - Pub. L. 109-163 amended section generally. Prior to amendment, section consisted of subsecs. (a) to (c) relating to requirement for management structure, contracting responsibilities of designated officials, and definitions. 2002 - Subsec. (c). Pub. L. 107-314 inserted comma after "a task order". IMPLEMENTATION OF RECOMMENDATIONS OF DEFENSE SCIENCE BOARD TASK FORCE ON IMPROVEMENTS TO SERVICE CONTRACTING Pub. L. 112-81, div. A, title VIII, Sec. 807, Dec. 31, 2011, 125 Stat. 1488, provided that: "(a) Plan for Implementation. - Not later than 180 days after the date of the enactment of this Act [Dec. 31, 2011], the Under Secretary of Defense for Acquisition, Technology, and Logistics shall, acting pursuant to the Under Secretary's responsibility under section 2330 of title 10, United States Code, develop a plan for implementing the recommendations of the Defense Science Board Task Force on Improvements to Service Contracting. "(b) Elements. - The plan developed pursuant to subsection (a) shall include, to the extent determined appropriate by the Under Secretary for Acquisition, Technology, and Logistics, the following: "(1) Meaningful incentives to services contractors for high performance at low cost, consistent with the objectives of the Better Buying Power Initiative established by the Under Secretary. "(2) Improved means of communication between the Government and the services contracting industry in the process of developing requirements for services contracts. "(3) Clear guidance for defense acquisition personnel on the use of appropriate contract types for particular categories of services contracts. "(4) Formal certification and training requirements for services acquisition personnel, consistent with the requirements of sections 1723 and 1724 of title 10, United States Code. "(5) Appropriate emphasis on the recruiting and training of services acquisition personnel, consistent with the strategic workforce plan developed pursuant to section 115b of title 10, United States Code, and the funds available through the Department of Defense Acquisition Workforce Development Fund established pursuant to section 1705 of title 10, United States Code. "(6) Policies and guidance on career development for services acquisition personnel, consistent with the requirements of sections 1722a and 1722b of title 10, United States Code. "(7) Actions to ensure that the military departments dedicate portfolio-specific commodity managers to coordinate the procurement of key categories of contract services, as required by section 2330(b)(3)(C) of title 10, United States Code. "(8) Actions to ensure that the Department of Defense conducts realistic exercises and training that account for services contracting during contingency operations, as required by section 2333(e) of title 10, United States Code. "(c) Comptroller General Report. - Not later than 18 months after the date of the enactment of this Act [Dec. 31, 2011], the Comptroller General of the United States shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report on the following: "(1) The actions taken by the Under Secretary of Defense for Acquisition, Technology, and Logistics to carry out the requirements of this section. "(2) The actions taken by the Under Secretary to carry out the requirements of section 2330 of title 10, United States Code. "(3) The actions taken by the military departments to carry out the requirements of section 2330 of title 10, United States Code. "(4) The extent to which the actions described in paragraphs (1), (2), and (3) have resulted in the improved acquisition and management of contract services." REQUIREMENTS FOR THE ACQUISITION OF SERVICES Pub. L. 111-383, div. A, title VIII, Sec. 863(a)-(h), Jan. 7, 2011, 124 Stat. 4293, 4294, as amended by Pub. L. 112-81, div. A, title IX, Sec. 933(c), Dec. 31, 2011, 125 Stat. 1544, provided that: "(a) Establishment of Requirements Processes for the Acquisition of Services. - The Secretary of Defense shall ensure that the military departments and Defense Agencies each establish a process for identifying, assessing, reviewing, and validating requirements for the acquisition of services. "(b) Operational Requirements. - With regard to requirements for the acquisition of services in support of combatant commands and military operations, the Secretary shall ensure - "(1) that the Chief of Staff of the Army, the Chief of Naval Operations, the Chief of Staff of the Air Force, and the Commandant of the Marine Corps implement and bear chief responsibility for carrying out, within the Armed Force concerned, the process established pursuant to subsection (a) for such Armed Force; and "(2) that commanders of unified combatant commands and other officers identified or designated as joint qualified officers have an opportunity to participate in the process of each military department to provide input on joint requirements for the acquisition of services. "(c) Supporting Requirements. - With regard to requirements for the acquisition of services not covered by subsection (b), the Secretary shall ensure that the secretaries of the military departments and the heads of the Defense Agencies implement and bear chief responsibility for carrying out, within the military department or Defense Agency concerned, the process established pursuant to subsection (a) for such military department or Defense Agency. "(d) Implementation Plans Required. - The Secretary shall ensure that an implementation plan is developed for each process established pursuant to subsection (a) that addresses, at a minimum, the following: "(1) The organization of such process. "(2) The level of command responsibility required for identifying, assessing, reviewing, and validating requirements for the acquisition of services in accordance with the requirements of this section and the categories established under section 2330(a)(1)(C) of title 10, United States Code. "(3) The composition of positions necessary to operate such process. "(4) The training required for personnel engaged in such process. "(5) The relationship between doctrine and such process. "(6) Methods of obtaining input on joint requirements for the acquisition of services. "(7) Procedures for coordinating with the acquisition process. "(8) Considerations relating to opportunities for strategic sourcing. "(9) Considerations relating to total force management policies and procedures established under section 129a of this title [probably should be "title 10, United States Code"]. "(e) Matters Required in Implementation Plan. - Each plan required under subsection (d) shall provide for initial implementation of a process for identifying, assessing, reviewing, and validating requirements for the acquisition of services not later than one year after the date of the enactment of this Act [Jan. 7, 2011] and shall provide for full implementation of such process at the earliest date practicable. "(f) Consistency With Joint Guidance. - Whenever, at any time, guidance is issued by the Chairman of the Joint Chiefs of Staff relating to requirements for the acquisition of services in support of combatant commands and military operations, each process established pursuant to subsection (a) shall be revised in accordance with such joint guidance. "(g) Definition. - The term 'requirements for the acquisition of services' means objectives to be achieved through acquisitions primarily involving the procurement of services. "(h) Review of Supporting Requirements To Identify Savings. - The secretaries of the military departments and the heads of the Defense Agencies shall review and validate each requirement described in subsection (c) with an anticipated cost in excess of $10,000,000 with the objective of identifying unneeded or low priority requirements that can be reduced or eliminated, with the savings transferred to higher priority objectives. Savings identified and transferred to higher priority objectives through review and revalidation under this subsection shall count toward the savings objectives established in the June 4, 2010, guidance of the Secretary of Defense on improved operational efficiencies and the annual reduction in funding for service support contractors required by the August 16, 2010, guidance of the Secretary of Defense on efficiency initiatives. As provided by the Secretary, cost avoidance shall not count toward these objectives." PROCUREMENT OF COMMERCIAL SERVICES Pub. L. 110-181, div. A, title VIII, Sec. 805, Jan. 28, 2008, 122 Stat. 212, as amended by Pub. L. 110-417, [div. A], title X, Sec. 1061(b)(4), Oct. 14, 2008, 122 Stat. 4613, provided that: "(a) Regulations Required. - Not later than 180 days after the date of the enactment of this Act [Jan. 28, 2008], the Secretary of Defense shall modify the regulations of the Department of Defense for the procurement of commercial services for or on behalf of the Department of Defense. "(b) Applicability of Commercial Procedures. - "(1) Services of a type sold in marketplace. - The regulations modified pursuant to subsection (a) shall ensure that services that are not offered and sold competitively in substantial quantities in the commercial marketplace, but are of a type offered and sold competitively in substantial quantities in the commercial marketplace, may be treated as commercial items for purposes of section 2306a of title 10, United States Code (relating to truth in negotiations), only if the contracting officer determines in writing that the offeror has submitted sufficient information to evaluate, through price analysis, the reasonableness of the price for such services. "(2) Information submitted. - To the extent necessary to make a determination under paragraph (1), the contracting officer may request the offeror to submit - "(A) prices paid for the same or similar commercial items under comparable terms and conditions by both government and commercial customers; and "(B) if the contracting officer determines that the information described in subparagraph (A) is not sufficient to determine the reasonableness of price, other relevant information regarding the basis for price or cost, including information on labor costs, material costs, and overhead rates. "(c) Time-and-Materials Contracts. - "(1) Commercial item acquisitions. - The regulations modified pursuant to subsection (a) shall ensure that procedures applicable to time-and-materials contracts and labor-hour contracts for commercial item acquisitions may be used only for the following: "(A) Services procured for support of a commercial item, as described in section 4(12)(E) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 403(12)(E)) [now 41 U.S.C. 103(5)]. "(B) Emergency repair services. "(C) Any other commercial services only to the extent that the head of the agency concerned approves a determination in writing by the contracting officer that - "(i) the services to be acquired are commercial services as defined in section 4(12)(F) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 403(12)(F)) [now 41 U.S.C. 103(6)]; "(ii) if the services to be acquired are subject to subsection (b), the offeror of the services has submitted sufficient information in accordance with that subsection; "(iii) such services are commonly sold to the general public through use of time-and-materials or labor-hour contracts; and "(iv) the use of a time-and-materials or labor-hour contract type is in the best interest of the Government. "(2) Non-commercial item acquisitions. - Nothing in this subsection shall be construed to preclude the use of procedures applicable to time-and-materials contracts and labor-hour contracts for non-commercial item acquisitions for the acquisition of any category of services." INDEPENDENT MANAGEMENT REVIEWS OF CONTRACTS FOR SERVICES Pub. L. 110-181, div. A, title VIII, Sec. 808, Jan. 28, 2008, 122 Stat. 215, as amended by Pub. L. 111-383, div. A, title X, Sec. 1075(f)(3), Jan. 7, 2011, 124 Stat. 4376, provided that: "(a) Guidance and Instructions. - Not later than 180 days after the date of the enactment of this Act [Jan. 28, 2008], the Secretary of Defense shall issue guidance, with detailed implementation instructions, for the Department of Defense to provide for periodic independent management reviews of contracts for services. The independent management review guidance and instructions issued pursuant to this subsection shall be designed to evaluate, at a minimum - "(1) contract performance in terms of cost, schedule, and requirements; "(2) the use of contracting mechanisms, including the use of competition, the contract structure and type, the definition of contract requirements, cost or pricing methods, the award and negotiation of task orders, and management and oversight mechanisms; "(3) the contractor's use, management, and oversight of subcontractors; "(4) the staffing of contract management and oversight functions; and "(5) the extent of any pass-throughs, and excessive pass- through charges (as defined in section 852 of the John Warner National Defense Authorization Act for Fiscal Year 2007 [Pub. L. 109-364, 10 U.S.C. 2324 note]), by the contractor. "(b) Additional Subject of Review. - In addition to the matters required by subsection (a), the guidance and instructions issued pursuant to subsection (a) shall provide for procedures for the periodic review of contracts under which one contractor provides oversight for services performed by other contractors. In particular, the procedures shall be designed to evaluate, at a minimum - "(1) the extent of the agency's reliance on the contractor to perform acquisition functions closely associated with inherently governmental functions as defined in section 2383(b)(3) of title 10, United States Code; and "(2) the financial interest of any prime contractor performing acquisition functions described in paragraph (1) in any contract or subcontract with regard to which the contractor provided advice or recommendations to the agency. "(c) Elements. - The guidance and instructions issued pursuant to subsection (a) shall address, at a minimum - "(1) the contracts subject to independent management reviews, including any applicable thresholds and exceptions; "(2) the frequency with which independent management reviews shall be conducted; "(3) the composition of teams designated to perform independent management reviews; "(4) any phase-in requirements needed to ensure that qualified staff are available to perform independent management reviews; "(5) procedures for tracking the implementation of recommendations made by independent management review teams; and "(6) procedures for developing and disseminating lessons learned from independent management reviews. "(d) Reports. - "(1) Report on guidance and instruction. - Not later than 270 days after the date of the enactment of this Act [Jan. 28, 2008], the Secretary of Defense shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report setting forth the guidance and instructions issued pursuant to subsection (a). "(2) GAO report on implementation. - Not later than two years after the date of the enactment of this Act, the Comptroller General of the United States shall submit to the congressional defense committees a report on the implementation of the guidance and instructions issued pursuant to subsection (a)." ESTABLISHMENT AND IMPLEMENTATION OF MANAGEMENT STRUCTURE Pub. L. 107-107, div. A, title VIII, Sec. 801(b)(2), Dec. 28, 2001, 115 Stat. 1176, directed the Secretary of Defense to establish and implement the management structure required under this section and the Under Secretary of Defense for Acquisition, Technology, and Logistics to issue guidance for officials in such management structure not later than 180 days after Dec. 28, 2001. PHASED IMPLEMENTATION; REPORT Pub. L. 109-163, div. A, title VIII, Sec. 812(b), (c), Jan. 6, 2006, 119 Stat. 3378, 3379, provided that: "(b) Phased Implementation. - The requirements of section 2330 of title 10, United States Code (as added by subsection (a)), shall be implemented as follows: "(1) The Under Secretary of Defense for Acquisition, Technology, and Logistics shall - "(A) establish an initial set of contract services acquisition categories, based on dollar thresholds, by not later than June 1, 2006; and "(B) issue an initial set of policies, procedures, and best practices guidelines in accordance with section 2330(a)(1)(A) by not later than October 1, 2006. "(2) The contract services acquisition categories established by the Under Secretary shall include - "(A) one or more categories for acquisitions with an estimated value of $250,000,000 or more; "(B) one or more categories for acquisitions with an estimated value of at least $10,000,000 but less than $250,000,000; and "(C) one or more categories for acquisitions with an estimated value greater than the simplified acquisition threshold but less than $10,000,000. "(3) The senior officials responsible for the management of acquisition of contract services shall assign responsibility to specific individuals in the Department of Defense for the review and approval of procurements in the contract services acquisition categories established by the Under Secretary, as follows: "(A) Not later than October 1, 2006, for all categories established pursuant to paragraph (2)(A). "(B) Not later than October 1, 2007, for all categories established pursuant to paragraph (2)(B). "(C) Not later than October 1, 2009, for all categories established pursuant to paragraph (2)(C). "(c) Report. - Not later than one year after the date of the enactment of this Act [Jan. 6, 2006], the Secretary of Defense shall submit to the Committees on Armed Services of the Senate and House of Representatives a final report on the implementation of section 2330 of title 10, United States Code, as added by this section." PROCUREMENT PROGRAM REVIEW STRUCTURE; COMPTROLLER GENERAL REVIEW Pub. L. 107-107, div. A, title VIII, Sec. 801(d)-(f), Dec. 28, 2001, 115 Stat. 1177, provided that: "(d) Requirement for Program Review Structure. - (1) Not later than 180 days after the date of the enactment of this Act [Dec. 28, 2001], the Secretary of Defense shall issue and implement a policy that applies to the procurement of services by the Department of Defense a program review structure that is similar to the one developed for and applied to the procurement of weapon systems by the Department of Defense. "(2) The program review structure for the procurement of services shall, at a minimum, include the following: "(A) Standards for determining which procurements should be subject to review by either the senior procurement executive of a military department or the senior procurement executive of the Department of Defense under such section, including criteria based on dollar thresholds, program criticality, or other appropriate measures. "(B) Appropriate key decision points at which those reviews should take place. "(C) A description of the specific matters that should be reviewed. "(e) Comptroller General Review. - Not later than 90 days after the date on which the Secretary issues the policy required by subsection (d) and the Under Secretary of Defense for Acquisition, Technology, and Logistics issues the guidance required by subsection (b)(2) [set out as a note above], the Comptroller General shall submit to the Committees on Armed Services of the Senate and the House of Representatives an assessment of the compliance with the requirements of this section [enacting this section and section 2330a of this title, amending sections 133 and 2331 of this title, and enacting provisions set out as a note under this section] and the amendments made by this section. "(f) Definitions. - In this section: "(1) The term 'senior procurement executive' means the official designated as the senior procurement executive under section 16(3) of the Office of Federal Procurement Policy Act ([former] 41 U.S.C. 414(3)) [see 41 U.S.C. 1702(c)]. "(2) The term 'performance-based', with respect to a contract or a task order means that the contract or task order, respectively, includes the use of performance work statements that set forth contract requirements in clear, specific, and objective terms with measurable outcomes." PERFORMANCE GOALS FOR PROCUREMENTS OF SERVICES Pub. L. 107-107, div. A, title VIII, Sec. 802, Dec. 28, 2001, 115 Stat. 1178, as amended by Pub. L. 107-314, div. A, title VIII, Sec. 805, Dec. 2, 2002, 116 Stat. 2605, provided that: "(a) Goals. - (1) It shall be an objective of the Department of Defense to achieve efficiencies in procurements of services pursuant to multiple award contracts through the use of - "(A) performance-based services contracting; "(B) appropriate competition for task orders under services contracts; "(C) program review, spending analyses, and improved management of services contracts. "(2) In furtherance of such objective, the Department of Defense shall have the following goals: "(A) To increase, as a percentage of all of the individual purchases of services made by or for the Department of Defense under multiple award contracts for a fiscal year (calculated on the basis of dollar value), the volume of the individual purchases of services that are made on a competitive basis and involve receipt of more than one offer from qualified contractors to a percentage as follows: "(i) For fiscal year 2003, a percentage not less than 40 percent. "(ii) For fiscal year 2004, a percentage not less than 50 percent. "(iii) For fiscal year 2011, a percentage not less than 75 percent. "(B) To increase, as a percentage of all of the individual purchases of services made by or for the Department of Defense under multiple award contracts for a fiscal year (calculated on the basis of dollar value), the use of performance-based purchasing specifying firm fixed prices for the specific tasks to be performed to a percentage as follows: "(i) For fiscal year 2003, a percentage not less than 25 percent. "(ii) For fiscal year 2004, a percentage not less than 35 percent. "(iii) For fiscal year 2005, a percentage not less than 50 percent. "(iv) For fiscal year 2011, a percentage not less than 70 percent. "(3) The Secretary of Defense may adjust any percentage goal established in paragraph (2) if the Secretary determines in writing that such a goal is too high and cannot reasonably be achieved. In the event that the Secretary chooses to adjust such a goal, the Secretary shall - "(A) establish a percentage goal that the Secretary determines would create an appropriate incentive for Department of Defense components to use competitive procedures or performance-based services contracting, as the case may be; and "(B) submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report containing an explanation of the reasons for the Secretary's determination and a statement of the new goal that the Secretary has established. "(b) Annual Report. - Not later than March 1, 2002, and annually thereafter through March 1, 2011, the Secretary of Defense shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report on the progress made toward meeting the objective and goals established in subsection (a). Each report shall include, at a minimum, the following information: "(1) A summary of the steps taken or planned to be taken in the fiscal year of the report to improve the management of procurements of services. "(2) A summary of the steps planned to be taken in the following fiscal year to improve the management of procurements of services. "(3) An estimate of the amount that will be expended by the Department of Defense for procurements of services in the fiscal year of the report. "(4) An estimate of the amount that will be expended by the Department of Defense for procurements of services in the following fiscal year. "(5) Regarding the individual purchases of services that were made by or for the Department of Defense under multiple award contracts in the fiscal year preceding the fiscal year in which the report is required to be submitted, information (determined using the data collection system established under section 2330a of title 10, United States Code) as follows: "(A) The percentage (calculated on the basis of dollar value) of such purchases that are purchases that were made on a competitive basis and involved receipt of more than one offer from qualified contractors. "(B) The percentage (calculated on the basis of dollar value) of such purchases that are performance-based purchases specifying firm fixed prices for the specific tasks to be performed. "(c) Definitions. - (1) In this section, the terms 'individual purchase' and 'multiple award contract' have the meanings given such terms in section 803(c) of this Act [10 U.S.C. 2304 note]. "(2) For the purposes of this section, an individual purchase of services is made on a competitive basis only if it is made pursuant to procedures described in paragraphs (2), (3), and (4) of section 803(b) of this Act [10 U.S.C. 2304 note]." -End- -CITE- 10 USC Sec. 2330a 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2330a. Procurement of services: tracking of purchases -STATUTE- (a) Data Collection Required. - The Secretary of Defense shall establish a data collection system to provide management information with regard to each purchase of services by a military department or Defense Agency in excess of the simplified acquisition threshold, regardless of whether such a purchase is made in the form of a contract, task order, delivery order, military interdepartmental purchase request, or any other form of interagency agreement. (b) Data To Be Collected. - The data required to be collected under subsection (a) includes the following: (1) The services purchased. (2) The total dollar amount of the purchase. (3) The form of contracting action used to make the purchase. (4) Whether the purchase was made through - (A) a performance-based contract, performance-based task order, or other performance-based arrangement that contains firm fixed prices for the specific tasks to be performed; (B) any other performance-based contract, performance-based task order, or performance-based arrangement; or (C) any contract, task order, or other arrangement that is not performance based. (5) In the case of a purchase made through an agency other than the Department of Defense, the agency through which the purchase is made. (6) The extent of competition provided in making the purchase and whether there was more than one offer. (7) Whether the purchase was made from - (A) a small business concern; (B) a small business concern owned and controlled by socially and economically disadvantaged individuals; or (C) a small business concern owned and controlled by women. (c) Inventory. - (1) Not later than the end of the third quarter of each fiscal year, the Secretary of Defense shall submit to Congress an annual inventory of the activities performed during the preceding fiscal year pursuant to contracts for services (and pursuant to contracts for goods to the extent services are a significant component of performance as identified in a separate line item of a contract) for or on behalf of the Department of Defense. The guidance for compiling the inventory shall be issued by the Under Secretary of Defense for Personnel and Readiness, the Under Secretary of Defense (Comptroller), and the Under Secretary of Defense for Acquisition, Technology, and Logistics, as follows: (A) The Under Secretary of Defense for Personnel and Readiness, as supported by the Under Secretary of Defense (Comptroller), shall be responsible for developing guidance for - (i) the collection of data regarding functions and missions performed by contractors in a manner that is comparable to the manpower data elements used in inventories of functions performed by Department of Defense employees; (ii) the calculation of contractor full-time equivalents for direct labor, using direct labor hours in a manner that is comparable to the calculation of Department of Defense civilian full-time employees; and (iii) the conduct and completion of the annual review required under subsection (e)(1). (B) The Under Secretary of Defense for Acquisition, Technology, and Logistics shall be responsible for developing guidance on other data elements and implementing procedures for requirements relating to acquisition. (2) The entry for an activity on an inventory under this subsection shall include, for the fiscal year covered by such entry, the following: (A) The functions and missions performed by the contractor. (B) The contracting organization, the component of the Department of Defense administering the contract, and the organization whose requirements are being met through contractor performance of the function. (C) The funding source for the contract under which the function is performed by appropriation and operating agency. (D) The fiscal year for which the activity first appeared on an inventory under this section. (E) The number of contractor employees, expressed as full-time equivalents for direct labor, using direct labor hours and associated cost data collected from contractors (except that estimates may be used where such data is not available and cannot reasonably be made available in a timely manner for the purpose of the inventory). (F) A determination whether the contract pursuant to which the activity is performed is a personal services contract. (G) A summary of the data required to be collected for the activity under subsection (a). (3) The inventory required under this subsection shall be submitted in unclassified form, but may include a classified annex. (d) Public Availability of Inventories. - Not later than 30 days after the date on which an inventory under subsection (c) is required to be submitted to Congress, the Secretary shall - (1) make the inventory available to the public; and (2) publish in the Federal Register a notice that the inventory is available to the public. (e) Review and Planning Requirements. - Within 90 days after the date on which an inventory is submitted under subsection (c), the Secretary of the military department or head of the Defense Agency responsible for activities in the inventory shall - (1) review the contracts and activities in the inventory for which such Secretary or agency head is responsible; (2) ensure that - (A) each contract on the list that is a personal services contract has been entered into, and is being performed, in accordance with applicable statutory and regulatory requirements; (B) the activities on the list do not include any inherently governmental functions; and (C) to the maximum extent practicable, the activities on the list do not include any functions closely associated with inherently governmental functions; and (3) identify activities that should be considered for conversion - (A) to performance by civilian employees of the Department of Defense pursuant to section 2463 of this title; or (B) to an acquisition approach that would be more advantageous to the Department of Defense. (f) Development of Plan and Enforcement and Approval Mechanisms. - The Secretary of the military department or head of the Defense Agency responsible for activities in the inventory shall develop a plan, including an enforcement mechanism and approval process, to - (1) provide for the use of the inventory by the military department or Defense Agency to implement the requirements of section 129a of this title; (2) ensure the inventory is used to inform strategic workforce planning; (3) facilitate use of the inventory for compliance with section 235 of this title; and (4) provide for appropriate consideration of the conversion of activities identified under subsection (e)(3) within a reasonable period of time. (g) Rule of Construction. - Nothing in this section shall be construed to authorize the performance of personal services by a contractor except where expressly authorized by a provision of law other than this section. (h) Definitions. - In this section: (1) The term "performance-based", with respect to a contract, task order, or arrangement, means that the contract, task order, or arrangement, respectively, includes the use of performance work statements that set forth contract requirements in clear, specific, and objective terms with measurable outcomes. (2) The definitions set forth in section 2225(f) of this title for the terms "simplified acquisition threshold", "small business concern", "small business concern owned and controlled by socially and economically disadvantaged individuals", and "small business concern owned and controlled by women" shall apply. (3) Function closely associated with inherently governmental functions. - The term "function closely associated with inherently governmental functions" has the meaning given that term in section 2383(b)(3) of this title. (4) Inherently governmental functions. - The term "inherently governmental functions" has the meaning given that term in section 2383(b)(2) of this title. (5) Personal services contract. - The term "personal services contract" means a contract under which, as a result of its terms or conditions or the manner of its administration during performance, contractor personnel are subject to the relatively continuous supervision and control of one or more Government officers or employees, except that the giving of an order for a specific article or service, with the right to reject the finished product or result, is not the type of supervision or control that makes a contract a personal services contract. -SOURCE- (Added Pub. L. 107-107, div. A, title VIII, Sec. 801(c), Dec. 28, 2001, 115 Stat. 1176; amended Pub. L. 110-181, div. A, title VIII, Sec. 807(a), Jan. 28, 2008, 122 Stat. 213; Pub. L. 111-84, div. A, title VIII, Sec. 803(b), Oct. 28, 2009, 123 Stat. 2402; Pub. L. 111- 383, div. A, title III, Sec. 321, Jan. 7, 2011, 124 Stat. 4183; Pub. L. 112-81, div. A, title IX, Sec. 936, Dec. 31, 2011, 125 Stat. 1545.) -MISC1- AMENDMENTS 2011 - Subsec. (c). Pub. L. 111-383, Sec. 321(2) to (4), substituted "The guidance for compiling the inventory shall be issued by the Under Secretary of Defense for Personnel and Readiness, the Under Secretary of Defense (Comptroller), and the Under Secretary of Defense for Acquisition, Technology, and Logistics, as follows:" for "The entry for an activity on an inventory under this subsection shall include, for the fiscal year covered by such entry, the following:" in par. (1), added new subpars. (A) and (B) to par. (1), inserted par. (2) designation and introductory provisions before former subpars. (A) to (G) of par. (1) thereby making them part of par. (2), added subpar. (E), and struck out former subpar. (E) which read as follows: "The number of full-time contractor employees (or its equivalent) paid for the performance of the activity." Subsec. (c)(1). Pub. L. 112-81, Sec. 936(a)(1), inserted "(and pursuant to contracts for goods to the extent services are a significant component of performance as identified in a separate line item of a contract)" after "pursuant to contracts for services" in introductory provisions. Subsec. (c)(1)(A)(ii), (iii). Pub. L. 112-81, Sec. 936(a)(2), added cls. (ii) and (iii) and struck out former cl. (ii) which read as follows: "the calculation of contractor manpower equivalents in a manner that is comparable to the calculation of full-time equivalents for use in inventories of functions performed by Department of Defense employees." Subsec. (c)(1)(B). Pub. L. 112-81, Sec. 936(a)(3), inserted "for requirements relating to acquisition" before period at end. Subsec. (c)(2), (3). Pub. L. 111-383, Sec. 321(1), redesignated par. (2) as (3). Subsec. (e)(2) to (4). Pub. L. 112-81, Sec. 936(b), inserted "and" at end of par. (2), substituted period for "; and" at end of par. (3), and struck out par. (4) which read as follows: "develop a plan, including an enforcement mechanism and approval process, to provide for appropriate consideration of the conversion of activities identified under paragraph (3) within a reasonable period of time." Subsec. (f) to (h). Pub. L. 112-81, Sec. 936(c), added subsec. (f) and redesignated former subsecs. (f) and (g) as (g) and (h), respectively. 2009 - Subsec. (e)(4). Pub. L. 111-84 inserted ", including an enforcement mechanism and approval process," after "plan". 2008 - Subsecs. (c) to (g). Pub. L. 110-181, Sec. 807(a)(1), (2), added subsecs. (c) to (f), redesignated former subsec. (d) as (g), and struck out heading and text of former subsec. (c). Former text read as follows: "To the maximum extent practicable, a single data collection system shall be used to collect data under this section and information under section 2225 of this title." Subsec. (g)(3) to (5). Pub. L. 110-181, Sec. 807(a)(3), added pars. (3) to (5). EFFECTIVE DATE OF 2008 AMENDMENT Pub. L. 110-181, div. A, title VIII, Sec. 807(b), Jan. 28, 2008, 122 Stat. 215, provided that: "(1) The amendments made by subsection (a) [amending this section] shall be effective upon the date of the enactment of this Act [Jan. 28, 2008]. "(2) The first inventory required by section 2330a(c) of title 10, United States Code, as added by subsection (a), shall be submitted not later than the end of the third quarter of fiscal year 2008." DEVELOPMENT OF GUIDANCE ON PERSONAL SERVICES CONTRACTS Pub. L. 110-417, [div. A], title VIII, Sec. 831, Oct. 14, 2008, 122 Stat. 4534, provided that: "(a) Guidance Required. - Not later than 270 days after the date of the enactment of this Act [Oct. 14, 2008], the Secretary of Defense shall develop guidance related to personal services contracts to - "(1) require a clear distinction between employees of the Department of Defense and employees of Department of Defense contractors; "(2) provide appropriate safeguards with respect to when, where, and to what extent the Secretary may enter into a contract for the procurement of personal services; and "(3) assess and take steps to mitigate the risk that, as implemented and administered, non-personal services contracts may become personal services contracts. "(b) Definition of Personal Services Contract. - In this section, the term 'personal services contract' has the meaning given that term in section 2330a(g)(5) [now 2330a(h)(5)] of title 10, United States Code." -End- -CITE- 10 USC Sec. 2331 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2331. Procurement of services: contracts for professional and technical services -STATUTE- (a) In General. - The Secretary of Defense shall prescribe regulations to ensure, to the maximum extent practicable, that professional and technical services are acquired on the basis of the task to be performed rather than on the basis of the number of hours of services provided. (b) Content of Regulations. - With respect to contracts to acquire services on the basis of the number of hours of services provided, the regulations described in subsection (a) shall - (1) include standards and approval procedures to minimize the use of such contracts; (2) establish criteria to ensure that proposals for contracts for technical and professional services are evaluated on a basis which does not encourage contractors to propose uncompensated overtime; (3) ensure appropriate emphasis on technical and quality factors in the source selection process; (4) require identification of any hours in excess of 40-hour weeks included in a proposal; (5) ensure that offerors are notified that proposals which include unrealistically low labor rates or which do not otherwise demonstrate cost realism will be considered in a risk assessment and evaluated appropriately; and (6) provide guidance to contracting officers to ensure that any use of uncompensated overtime will not degrade the level of technical expertise required to perform the contract. -SOURCE- (Added Pub. L. 101-510, div. A, title VIII, Sec. 834(a)(1), Nov. 5, 1990, 104 Stat. 1613; amended Pub. L. 102-25, title VII, Sec. 701(a), Apr. 6, 1991, 105 Stat. 113; Pub. L. 103-355, title I, Sec. 1004(c), Oct. 13, 1994, 108 Stat. 3253; Pub. L. 107-107, div. A, title VIII, Sec. 801(g)(1), Dec. 28, 2001, 115 Stat. 1177.) -MISC1- PRIOR PROVISIONS A prior section 2331 was renumbered section 2350 of this title. AMENDMENTS 2001 - Pub. L. 107-107 substituted "Procurement of services: contracts" for "Contracts" in section catchline. 1994 - Subsec. (c). Pub. L. 103-355 struck out text and heading of subsec. (c). Text read as follows: "(1) The Secretary of Defense may waive the limitation in section 2304(j)(4) of this title on the total value of task orders for specific contracting activities to the extent the Secretary considers the use of master agreements necessary in order to further the policy set forth in subsection (a). "(2) During any fiscal year, such a waiver may not increase the total value of task orders under master agreements of a contracting activity by more than 20 percent of the value of all contracts for advisory and assistance services awarded by that contracting activity during fiscal year 1989. "(3) Such a waiver shall not become effective until 60 days after the Secretary of Defense has published notice thereof in the Federal Register." 1991 - Subsec. (c)(1). Pub. L. 102-25 struck out "on a case-by- case basis" after "value of task orders", substituted "considers the use of master agreements necessary" for "considers necessary the use of master agreements", and struck out "of this section" before period at end. EFFECTIVE DATE OF 1994 AMENDMENT For effective date and applicability of amendment by Pub. L. 103- 355, see section 10001 of Pub. L. 103-355, set out as a note under section 2302 of this title. REGULATIONS Section 834(b) of Pub. L. 101-510 provided that: "Not later than 180 days after the date of the enactment of this Act [Nov. 5, 1990], the Secretary of Defense shall publish for public comment new regulations to carry out the requirements in this section [enacting this section]. The Secretary shall promulgate final regulations to carry out such requirements not later than 270 days after the date of the enactment of this Act." PROVISIONS NOT AFFECTED BY PUB. L. 103-355 Repeal of subsec. (c) of this section by Pub. L. 103-355 not to be construed as modifying or superseding, or as intended to impair or restrict, authorities or responsibilities under former 40 U.S.C. 759 or chapter 11 of Title 40, Public Buildings, Property, and Works, see section 1004(d) of Pub. L. 103-355, set out as a note under section 2304a of this title. -End- -CITE- 10 USC Sec. 2332 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2332. Share-in-savings contracts -STATUTE- (a) Authority To Enter Into Share-in-Savings Contracts. - (1) The head of an agency may enter into a share-in-savings contract for information technology (as defined in section 11101(6) of title 40) in which the Government awards a contract to improve mission- related or administrative processes or to accelerate the achievement of its mission and share with the contractor in savings achieved through contract performance. (2)(A) Except as provided in subparagraph (B), a share-in-savings contract shall be awarded for a period of not more than five years. (B) A share-in-savings contract may be awarded for a period greater than five years, but not more than 10 years, if the head of the agency determines in writing prior to award of the contract that - (i) the level of risk to be assumed and the investment to be undertaken by the contractor is likely to inhibit the government from obtaining the needed information technology competitively at a fair and reasonable price if the contract is limited in duration to a period of five years or less; and (ii) usage of the information technology to be acquired is likely to continue for a period of time sufficient to generate reasonable benefit for the government. (3) Contracts awarded pursuant to the authority of this section shall, to the maximum extent practicable, be performance-based contracts that identify objective outcomes and contain performance standards that will be used to measure achievement and milestones that must be met before payment is made. (4) Contracts awarded pursuant to the authority of this section shall include a provision containing a quantifiable baseline that is to be the basis upon which a savings share ratio is established that governs the amount of payment a contractor is to receive under the contract. Before commencement of performance of such a contract, the senior procurement executive of the agency shall determine in writing that the terms of the provision are quantifiable and will likely yield value to the Government. (5)(A) The head of the agency may retain savings realized through the use of a share-in-savings contract under this section that are in excess of the total amount of savings paid to the contractor under the contract, but may not retain any portion of such savings that is attributable to a decrease in the number of civilian employees of the Federal Government performing the function. Except as provided in subparagraph (B), savings shall be credited to the appropriation or fund against which charges were made to carry out the contract and shall be used for information technology. (B) Amounts retained by the agency under this subsection shall - (i) without further appropriation, remain available until expended; and (ii) be applied first to fund any contingent liabilities associated with share-in-savings procurements that are not fully funded. (b) Cancellation and Termination. - (1) If funds are not made available for the continuation of a share-in-savings contract entered into under this section in a subsequent fiscal year, the contract shall be canceled or terminated. The costs of cancellation or termination may be paid out of - (A) appropriations available for the performance of the contract; (B) appropriations available for acquisition of the information technology procured under the contract, and not otherwise obligated; or (C) funds subsequently appropriated for payments of costs of cancellation or termination, subject to the limitations in paragraph (3). (2) The amount payable in the event of cancellation or termination of a share-in-savings contract shall be negotiated with the contractor at the time the contract is entered into. (3)(A) Subject to subparagraph (B), the head of an agency may enter into share-in-savings contracts under this section in any given fiscal year even if funds are not made specifically available for the full costs of cancellation or termination of the contract if funds are available and sufficient to make payments with respect to the first fiscal year of the contract and the following conditions are met regarding the funding of cancellation and termination liability: (i) The amount of unfunded contingent liability for the contract does not exceed the lesser of - (I) 25 percent of the estimated costs of a cancellation or termination; or (II) $5,000,000. (ii) Unfunded contingent liability in excess of $1,000,000 has been approved by the Director of the Office of Management and Budget or the Director's designee. (B) The aggregate number of share-in-savings contracts that may be entered into under subparagraph (A) by all agencies to which this chapter applies in a fiscal year may not exceed 5 in each of fiscal years 2003, 2004, and 2005. (c) Definitions. - In this section: (1) The term "contractor" means a private entity that enters into a contract with an agency. (2) The term "savings" means - (A) monetary savings to an agency; or (B) savings in time or other benefits realized by the agency, including enhanced revenues (other than enhanced revenues from the collection of fees, taxes, debts, claims, or other amounts owed the Federal Government). (3) The term "share-in-savings contract" means a contract under which - (A) a contractor provides solutions for - (i) improving the agency's mission-related or administrative processes; or (ii) accelerating the achievement of agency missions; and (B) the head of the agency pays the contractor an amount equal to a portion of the savings derived by the agency from - (i) any improvements in mission-related or administrative processes that result from implementation of the solution; or (ii) acceleration of achievement of agency missions. (d) Termination. - No share-in-savings contracts may be entered into under this section after September 30, 2005. -SOURCE- (Added Pub. L. 107-347, title II, Sec. 210(a)(1), Dec. 17, 2002, 116 Stat. 2932.) -MISC1- EFFECTIVE DATE Section effective 120 days after Dec. 17, 2002, see section 402(a) of Pub. L. 107-347, set out as a note under section 3601 of Title 44, Public Printing and Documents. -End- -CITE- 10 USC Sec. 2333 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2333. Joint policies on requirements definition, contingency program management, and contingency contracting -STATUTE- (a) Joint Policy Requirement. - The Secretary of Defense, in consultation with the Chairman of the Joint Chiefs of Staff, shall develop joint policies for requirements definition, contingency program management, and contingency contracting during combat operations and post-conflict operations. (b) Requirements Definition Matters Covered. - The joint policy for requirements definition required by subsection (a) shall, at a minimum, provide for the following: (1) The assignment of a senior commissioned officer or civilian member of the senior executive service, with appropriate experience and qualifications related to the definition of requirements to be satisfied through acquisition contracts (such as for delivery of products or services, performance of work, or accomplishment of a project), to act as head of requirements definition and coordination during combat operations, post- conflict operations, and contingency operations, if required, including leading a requirements review board involving all organizations concerned. (2) An organizational approach to requirements definition and coordination during combat operations, post-conflict operations, and contingency operations that is designed to ensure that requirements are defined in a way that effectively implements United States Government and Department of Defense objectives, policies, and decisions regarding the allocation of resources, coordination of interagency efforts in the theater of operations, and alignment of requirements with the proper use of funds. (c) Contingency Program Management Matters Covered. - The joint policy for contingency program management required by subsection (a) shall, at a minimum, provide for the following: (1) The assignment of a senior commissioned officer or civilian member of the senior executive service, with appropriate program management experience and qualifications, to act as head of program management during combat operations, post-conflict operations, and contingency operations, including stabilization and reconstruction operations involving multiple United States Government agencies and international organizations, if required. (2) A preplanned organizational approach to program management during combat operations, post-conflict operations, and contingency operations that is designed to ensure that the Department of Defense is prepared to conduct such program management. (3) Identification of a deployable cadre of experts, with the appropriate tools and authority, and trained in processes under paragraph (6). (4) Utilization of the hiring and appointment authorities necessary for the rapid deployment of personnel to ensure the availability of key personnel for sufficient lengths of time to provide for continuing program and project management. (5) A requirement to provide training (including training under a program to be created by the Defense Acquisition University) to program management personnel in - (A) the use of laws, regulations, policies, and directives related to program management in combat or contingency environments; (B) the integration of cost, schedule, and performance objectives into practical acquisition strategies aligned with available resources and subject to effective oversight; and (C) procedures of the Department of Defense related to funding mechanisms and contingency contract management. (6) Appropriate steps to ensure that training is maintained for such personnel even when they are not deployed in a contingency operation. (7) Such steps as may be needed to ensure jointness and cross- service coordination in the area of program management during contingency operations. (d) Contingency Contracting Matters Covered. - (1) The joint policy for contingency contracting required by subsection (a) shall, at a minimum, provide for the following: (A) The designation of a senior commissioned officer or civilian member of the senior executive service in each military department with the responsibility for administering the policy. (B) The assignment of a senior commissioned officer with appropriate acquisition experience and qualifications to act as head of contingency contracting during combat operations, post- conflict operations, and contingency operations, who shall report directly to the commander of the combatant command in whose area of responsibility the operations occur. (C) A sourcing approach to contingency contracting that is designed to ensure that each military department is prepared to conduct contingency contracting during combat operations, post- conflict operations, and contingency operations, including stabilization and reconstruction operations involving interagency organizations, if required. (D) A requirement to provide training (including training under a program to be created by the Defense Acquisition University) to contingency contracting personnel in - (i) the use of law, regulations, policies, and directives related to contingency contracting operations; (ii) the appropriate use of rapid acquisition methods, including the use of exceptions to competition requirements under section 2304 of this title, sealed bidding, letter contracts, indefinite delivery-indefinite quantity task orders, set asides under section 8(a) of the Small Business Act (15 U.S.C. 637(a)), undefinitized contract actions, and other tools available to expedite the delivery of goods and services during combat operations or post-conflict operations; (iii) the appropriate use of rapid acquisition authority, commanders' emergency response program funds, and other tools unique to contingency contracting; and (iv) instruction on the necessity for the prompt transition from the use of rapid acquisition authority to the use of full and open competition and other methods of contracting that maximize transparency in the acquisition process. (E) Appropriate steps to ensure that training is maintained for such personnel even when they are not deployed in a contingency operation. (F) Such steps as may be needed to ensure jointness and cross- service coordination in the area of contingency contracting. (2) To the extent practicable, the joint policy for contingency contracting required by subsection (a) should be taken into account in the development of interagency plans for stabilization and reconstruction operations, consistent with the report submitted by the President under section 1035 of the John Warner National Defense Authorization Act for Fiscal Year 2007 (Public Law 109-364; 120 Stat. 2388) on interagency operating procedures for the planning and conduct of stabilization and reconstruction operations. (e) Training for Personnel Outside Acquisition Workforce. - (1) The joint policy for requirements definition, contingency program management, and contingency contracting required by subsection (a) shall provide for training of military personnel outside the acquisition workforce (including operational field commanders and officers performing key staff functions for operational field commanders) who are expected to have acquisition responsibility, including oversight duties associated with contracts or contractors, during combat operations, post-conflict operations, and contingency operations. (2) Training under paragraph (1) shall be sufficient to ensure that the military personnel referred to in that paragraph understand the scope and scale of contractor support they will experience in contingency operations and are prepared for their roles and responsibilities with regard to requirements definition, program management (including contractor oversight), and contingency contracting. (3) The joint policy shall also provide for the incorporation of contractors and contract operations in mission readiness exercises for operations that will include contracting and contractor support. (f) Definitions. - In this section: (1) Contingency contracting personnel. - The term "contingency contracting personnel" means members of the armed forces and civilian employees of the Department of Defense who are members of the defense acquisition workforce and, as part of their duties, are assigned to provide support to contingency operations (whether deployed or not). (2) Contingency contracting. - The term "contingency contracting" means all stages of the process of acquiring property or services by the Department of Defense during a contingency operation. (3) Contingency operation. - The term "contingency operation" has the meaning provided in section 101(a)(13) of this title. (4) Acquisition support agencies. - The term "acquisition support agencies" means Defense Agencies and Department of Defense Field Activities that carry out and provide support for acquisition-related activities. (5) Contingency program management. - The term "contingency program management" means the process of planning, organizing, staffing, controlling, and leading the combined efforts of participating civilian and military personnel and organizations for the management of a specific defense acquisition program or programs during combat operations, post-conflict operations, and contingency operations. (6) Requirements definition. - The term "requirements definition" means the process of translating policy objectives and mission needs into specific requirements, the description of which will be the basis for awarding acquisition contracts for projects to be accomplished, work to be performed, or products to be delivered. -SOURCE- (Added Pub. L. 109-364, div. A, title VIII, Sec. 854(a)(1), Oct. 17, 2006, 120 Stat. 2343; amended Pub. L. 110-181, div. A, title VIII, Sec. 849(a), Jan. 28, 2008, 122 Stat. 245; Pub. L. 111-84, div. A, title X, Sec. 1073(a)(23), Oct. 28, 2009, 123 Stat. 2473.) -REFTEXT- REFERENCES IN TEXT Section 1035 of the John Warner National Defense Authorization Act for Fiscal Year 2007, referred to in subsec. (d)(2), is section 1035 of Pub. L. 109-364, div. A, title X, Oct. 17, 2006, 120 Stat. 2388, which is not classified to the Code. -MISC1- AMENDMENTS 2009 - Subsec. (d)(1)(D)(ii). Pub. L. 111-84, Sec. 1073(a)(23)(A), substituted "indefinite delivery-indefinite quantity" for "indefinite delivery indefinite quantity". Subsec. (d)(2). Pub. L. 111-84, Sec. 1073(a)(23)(B), substituted "the John Warner National Defense Authorization Act for Fiscal Year 2007 (Public Law 109-364; 120 Stat. 2388)" for "this Act". Subsec. (f)(3). Pub. L. 111-84, Sec. 1073(a)(23)(C), substituted "section 101(a)(13)" for "section 101(13)". 2008 - Subsecs. (e), (f). Pub. L. 110-181 added subsec. (e) and redesignated former subsec. (e) as (f). DEADLINE FOR DEVELOPMENT OF JOINT POLICIES Pub. L. 109-364, div. A, title VIII, Sec. 854(b), Oct. 17, 2006, 120 Stat. 2346, provided that: "The Secretary of Defense shall develop the joint policies required under section 2333 of title 10, United States Code, as added by subsection (a), not later than 18 months after the date of enactment of this Act [Oct. 17, 2006]." -End- -CITE- 10 USC Sec. 2334 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2334. Independent cost estimation and cost analysis -STATUTE- (a) In General. - The Director of Cost Assessment and Program Evaluation shall ensure that the cost estimation and cost analysis processes of the Department of Defense provide accurate information and realistic estimates of cost for the acquisition programs of the Department of Defense. In carrying out that responsibility, the Director shall - (1) prescribe, by authority of the Secretary of Defense, policies and procedures for the conduct of cost estimation and cost analysis for the acquisition programs of the Department of Defense; (2) provide guidance to and consult with the Secretary of Defense, the Under Secretary of Defense for Acquisition, Technology, and Logistics, the Under Secretary of Defense (Comptroller), the Secretaries of the military departments, and the heads of the Defense Agencies with respect to cost estimation in the Department of Defense in general and with respect to specific cost estimates and cost analyses to be conducted in connection with a major defense acquisition program under chapter 144 of this title or a major automated information system program under chapter 144A of this title; (3) issue guidance relating to the proper selection of confidence levels in cost estimates generally, and specifically, for the proper selection of confidence levels in cost estimates for major defense acquisition programs and major automated information system programs; (4) issue guidance relating to full consideration of life-cycle management and sustainability costs in major defense acquisition programs and major automated information system programs; (5) review all cost estimates and cost analyses conducted in connection with major defense acquisition programs and major automated information system programs; (6) conduct independent cost estimates and cost analyses for major defense acquisition programs and major automated information system programs for which the Under Secretary of Defense for Acquisition, Technology, and Logistics is the Milestone Decision Authority - (A) in advance of - (i) any certification under section 2366a or 2366b of this title; (ii) any decision to enter into low-rate initial production or full-rate production; (iii) any certification under section 2433a of this title; and (iv) any report under section 2445c(f) of this title; and (B) at any other time considered appropriate by the Director or upon the request of the Under Secretary of Defense for Acquisition, Technology, and Logistics; and (7) periodically assess and update the cost indexes used by the Department to ensure that such indexes have a sound basis and meet the Department's needs for realistic cost estimation. (b) Review of Cost Estimates, Cost Analyses, and Records of the Military Departments and Defense Agencies. - The Secretary of Defense shall ensure that the Director of Cost Assessment and Program Evaluation - (1) promptly receives the results of all cost estimates and cost analyses conducted by the military departments and Defense Agencies, and all studies conducted by the military departments and Defense Agencies in connection with such cost estimates and cost analyses, for major defense acquisition programs and major automated information system programs of the military departments and Defense Agencies; and (2) has timely access to any records and data in the Department of Defense (including the records and data of each military department and Defense Agency and including classified and proprietary information) that the Director considers necessary to review in order to carry out any duties under this section. (c) Participation, Concurrence, and Approval in Cost Estimation. - The Director of Cost Assessment and Program Evaluation may - (1) participate in the discussion of any discrepancies between an independent cost estimate and the cost estimate of a military department or Defense Agency for a major defense acquisition program or major automated information system program of the Department of Defense; (2) comment on deficiencies in the methodology or execution of any cost estimate or cost analysis developed by a military department or Defense Agency for a major defense acquisition program or major automated information system program; (3) concur in the choice of a cost estimate within the baseline description or any other cost estimate (including the confidence level for any such cost estimate) for use at any event specified in subsection (a)(6); and (4) participate in the consideration of any decision to request authorization of a multiyear procurement contract for a major defense acquisition program. (d) Disclosure of Confidence Levels for Baseline Estimates of Major Defense Acquisition Programs. - The Director of Cost Assessment and Program Evaluation, and the Secretary of the military department concerned or the head of the Defense Agency concerned (as applicable), shall each - (1) disclose in accordance with paragraph (3) the confidence level used in establishing a cost estimate for a major defense acquisition program or major automated information system program and the rationale for selecting such confidence level; (2) ensure that such confidence level provides a high degree of confidence that the program can be completed without the need for significant adjustment to program budgets; and (3) include the disclosure required by paragraph (1) - (A) in any decision documentation approving a cost estimate within the baseline description or any other cost estimate for use at any event specified in subsection (a)(6); and (B) in the next Selected Acquisition Report pursuant to section 2432 of this title in the case of a major defense acquisition program, or the next quarterly report pursuant to section 2445c of this title in the case of a major automated information system program. (e) Estimates for Program Baseline and Analyses and Targets for Contract Negotiation Purposes. - (1) The policies, procedures, and guidance issued by the Director of Cost Assessment and Program Evaluation in accordance with the requirements of subsection (a) shall provide that cost estimates developed for baseline descriptions and other program purposes conducted pursuant to subsection (a)(6) are not to be used for the purpose of contract negotiations or the obligation of funds. (2) The Under Secretary of Defense for Acquisition, Technology, and Logistics shall, in consultation with the Director of Cost Assessment and Program Evaluation, develop policies, procedures, and guidance to ensure that cost analyses and targets developed for the purpose of contract negotiations and the obligation of funds are based on the Government's reasonable expectation of successful contractor performance in accordance with the contractor's proposal and previous experience. (3) The Program Manager and contracting officer for each major defense acquisition program and major automated information system program shall ensure that cost analyses and targets developed for the purpose of contract negotiations and the obligation of funds are carried out in accordance with the requirements of paragraph (1) and the policies, procedures, and guidance issued by the Under Secretary of Defense for Acquisition, Technology, and Logistics under paragraph (2). (4) Funds that are made available for a major defense acquisition program or major automated information system program in accordance with a cost estimate conducted pursuant to subsection (a)(6), but are excess to a cost analysis or target developed pursuant to paragraph (2), shall remain available for obligation in accordance with the terms of applicable authorization and appropriations Acts. (5) Funds described in paragraph (4) - (A) may be used - (i) to cover any increased program costs identified by a revised cost analysis or target developed pursuant to paragraph (2); (ii) to acquire additional end items in accordance with the requirements of section 2308 of this title; or (iii) to cover the cost of risk reduction and process improvements; and (B) may be reprogrammed, in accordance with established procedures, only if determined to be excess to program needs on the basis of a cost estimate developed with the concurrence of the Director of Cost Assessment and Program Evaluation. (f) Annual Report on Cost Assessment Activities. - (1) The Director of Cost Assessment and Program Evaluation shall prepare an annual report summarizing the cost estimation and cost analysis activities of the Department of Defense during the previous year and assessing the progress of the Department in improving the accuracy of its cost estimates and analyses. Each report shall include, for the year covered by such report, an assessment of - (A) the extent to which each of the military departments and Defense Agencies have complied with policies, procedures, and guidance issued by the Director with regard to the preparation of cost estimates for major defense acquisition programs and major automated information systems; (B) the overall quality of cost estimates prepared by each of the military departments and Defense Agencies for major defense acquisition programs and major automated information system programs; and (C) any consistent differences in methodology or approach among the cost estimates prepared by the military departments, the Defense Agencies, and the Director. (2) Each report under this subsection shall be submitted concurrently to the Secretary of Defense, the Under Secretary of Defense for Acquisition, Technology, and Logistics, the Under Secretary of Defense (Comptroller), and the congressional defense committees not later than 10 days after the transmittal to Congress of the budget of the President for the next fiscal year (as submitted pursuant to section 1105 of title 31). (3)(A) Each report submitted to the congressional defense committees under this subsection shall be submitted in unclassified form, but may include a classified annex. (B) The Director shall ensure that a report submitted under this subsection does not include any information, such as proprietary or source selection sensitive information, that could undermine the integrity of the acquisition process. (C) The unclassified version of each report submitted to the congressional defense committees under this subsection shall be posted on an Internet website of the Department of Defense that is available to the public. (4) The Secretary of Defense may comment on any report of the Director to the congressional defense committees under this subsection. (g) Staff. - The Secretary of Defense shall ensure that the Director of Cost Assessment and Program Evaluation has sufficient professional staff of military and civilian personnel to enable the Director to carry out the duties and responsibilities of the Director under this section. -SOURCE- (Added Pub. L. 111-23, title I, Sec. 101(b)(1), May 22, 2009, 123 Stat. 1706; amended Pub. L. 111-383, div. A, title VIII, Sec. 811, Jan. 7, 2011, 124 Stat. 4263; Pub. L. 112-81, div. A, title VIII, Sec. 833, Dec. 31, 2011, 125 Stat. 1506.) -MISC1- AMENDMENTS 2011 - Subsec. (d)(1). Pub. L. 111-383, Sec. 811(1)(A), substituted "paragraph (3)" for "paragraph (2)" and "and the rationale for selecting such confidence level;" for ", the rationale for selecting such confidence level, and, if such confidence level is less than 80 percent, the justification for selecting a confidence level of less than 80 percent; and". Subsec. (d)(2), (3). Pub. L. 111-383, Sec. 811(1)(B), (C), added par. (2) and redesignated former par. (2) as (3). Subsec. (e). Pub. L. 111-383, Sec. 811(3), added subsec. (e). Former subsec. (e) redesignated (f). Subsec. (e)(1). Pub. L. 112-81, Sec. 833(2)(A), (B), substituted "shall provide that" for "shall provide that - ", struck out subpar. (A) designation before "cost estimates", and substituted period at end for "; and". Subsec. (e)(2). Pub. L. 112-81, Sec. 833(3), substituted "The Under Secretary of Defense for Acquisition, Technology, and Logistics shall, in consultation with the Director of Cost Assessment and Program Evaluation, develop policies, procedures, and guidance to ensure that cost analyses and targets" for "cost analyses and targets". Pub. L. 112-81, Sec. 833(2)(C), redesignated par. (1)(B) as (2) and realigned margin. Former par. (2) redesignated (3). Subsec. (e)(3). Pub. L. 112-81, Sec. 833(4), substituted "issued by the Under Secretary of Defense for Acquisition, Technology, and Logistics under paragraph (2)" for "issued by the Director of Cost Assessment and Program Evaluation". Pub. L. 112-81, Sec. 833(1), redesignated par. (2) as (3). Former par. (3) redesignated (4). Subsec. (e)(4). Pub. L. 112-81, Sec. 833(1), redesignated par. (3) as (4). Former par. (4) redesignated (5). Subsec. (e)(5). Pub. L. 112-81, Sec. 833(5), substituted "paragraph (4)" for "paragraph (3)" in introductory provisions. Pub. L. 112-81, Sec. 833(1), redesignated par. (4) as (5). Subsecs. (f), (g). Pub. L. 111-383, Sec. 811(2), redesignated subsecs. (e) and (f) as (f) and (g), respectively. -End- -CITE- 10 USC Sec. 2335 01/03/2012 (112-90) -EXPCITE- TITLE 10 - ARMED FORCES Subtitle A - General Military Law PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 137 - PROCUREMENT GENERALLY -HEAD- Sec. 2335. Prohibition on collection of political information -STATUTE- (a) Prohibition on Requiring Submission of Political Information. - The head of an agency may not require a contractor to submit political information related to the contractor or a subcontractor at any tier, or any partner, officer, director, or employee of the contractor or subcontractor - (1) as part of a solicitation, request for bid, request for proposal, or any other form of communication designed to solicit offers in connection with the award of a contract for procurement of property or services; or (2) during the course of contract performance as part of the process associated with modifying a contract or exercising a contract option. (b) Scope. - The prohibition under this section applies to the procurement of commercial items, the procurement of commercial-off- the-shelf-items, and the non-commercial procurement of supplies, property, services, and manufactured items, irrespective of contract vehicle, including contracts, purchase orders, task or deliver orders under indefinite delivery/indefinite quantity contracts, blanket purchase agreements, and basic ordering agreements. (c) Rule of Construction. - Nothing in this section shall be construed as - (1) waiving, superseding, restricting, or limiting the application of the Federal Election Campaign Act of 1971 (2 U.S.C. 431 et seq.) or preventing Federal regulatory or law enforcement agencies from collecting or receiving information authorized by law; or (2) precluding the Defense Contract Audit Agency from accessing and reviewing certain information, including political information, for the purpose of identifying unallowable costs and administering cost principles established pursuant to section 2324 of this title. (d) Definitions. - In this section: (1) Contractor. - The term "contractor" includes contractors, bidders, and offerors, and individuals and legal entities who would reasonably be expected to submit offers or bids for Federal Government contracts. (2) Political information. - The term "political information" means information relating to political spending, including any payment consisting of a contribution, expenditure, independent expenditure, or disbursement for an electioneering communication that is made by the contractor, any of its partners, officers, directors or employees, or any of its affiliates or subsidiaries to a candidate or on behalf of a candidate for election for Federal office, to a political committee, to a political party, to a third party entity with the intention or reasonable expectation that it would use the payment to make independent expenditures or electioneering communications, or that is otherwise made with respect to any election for Federal office, party affiliation, and voting history. Each of the terms "contribution", "expenditure", "independent expenditure", "candidate", "election", "electioneering communication", and "Federal office" has the meaning given the term in the Federal Campaign (!1) Act of 1971 (2 U.S.C. 431 et seq.). -SOURCE- (Added Pub. L. 112-81, div. A, title VIII, Sec. 823(a), Dec. 31, 2011, 125 Stat. 1502.) -REFTEXT- REFERENCES IN TEXT The Federal Election Campaign Act of 1971, referred to in subsecs. (c)(1) and (d)(2), is Pub. L. 92-225, Feb. 7, 1972, 86 Stat. 3, which is classified principally to chapter 14 (Sec. 431 et seq.) of Title 2, The Congress. For complete classification of this Act to the Code, see Short Title note set out under section 431 of Title 2 and Tables. -FOOTNOTE- (!1) So in original. Probably should be preceded by "Election". -End-