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Panoptic Enterprises' FEDERAL CONTRACTS DISPATCH

DATE: June 25, 2004

SUBJECT: Defense Federal Acquisition Regulation Supplement (DFARS); Use of FAR Part 12 Commercial Procedures for Performance-Based Service Contracts

SOURCE: Federal Register, June 25, 2004, Vol. 69, No. 122, page 35532

AGENCIES: Department of Defense (DOD)

ACTION: Final Rule

SYNOPSIS: DOD is removing DFARS Subaprt 212.1, Acquisition of Commercial Items -- General, and DFARS Subpart 237.6, Performance-Based Contracting, because the statutory authority upon which the text was based has expired. The expired statutory authority had permitted DOD to use procedures in Federal Acquisition Regulation (FAR) Part 12, Acquisition of Commercial Item, for procuring certain performance-based service contracts and task orders. The FAR has recently been amended to implement the superseding authority.

EDITOR'S NOTE: For more on the acquisition-related provisions of Public Law 108-136, see the November 25, 2003, FEDERAL CONTRACTS DISPATCH "Enactment of the National Defense Authorization Act for Fiscal Year 2004."

For more on the FAR implementation of Section 1431 of Public Law 108-136, see the June 18, 2004, FEDERAL CONTRACTS DISPATCH "Federal Acquisition Circular (FAC) 2001-24, Miscellaneous Amendments," Item (1).

EFFECTIVE DATE: June 25, 2004.

FOR FURTHER INFORMATION CONTACT: Teresa Brooks, Defense Acquisition Regulations Council, OUSD(AT&L)DPAP(DAR), IMD 3C132, 3062 Defense Pentagon, Washington, DC 20301-3062; 703-602-0326; fax: 703-602-0350. Cite "DFARS Case 2003-D111" when referring to this final rule.

SUPPLEMENTARY INFORMATION: DFARS Subpart 212.1 and DFARS Subpart 237.6 implemented Section 821 of the National Defense Authorization Act for Fiscal Year 2001 (Public Law 106-398) (see the November 8, 2000, FEDERAL CONTRACTS DISPATCH "Enactment of the National Defense Authorization Act of Fiscal Year 2001"). Section 821 permitted DOD to use procedures in FAR Part 12, Acquisition of Commercial Items, for firm-fixed-price performance-based service contracts and task orders of $5 million or less. The Section 821 authority expired October 30, 2003, but it has been superseded by the authority in Section 1431 of the National Defense Authorization Act for Fiscal Year 2004 (Public Law 108-136), which permits non-commercial performance-based service contracts or task orders to be treated as contracts for commercial items if the value of the contract or order does not exceed $25 million and each task has a firm-fixed-price. This authority has been implemented in FAR Subpart 12.1 and FAR Subpart 37.6 by FAC 2001-24.

Since the authority implemented by DFARS Subpart 212.1 and DFARS Subpart 237.6 has expired, and the superseding authority of Section 821 has been implemented in FAR Subpart 12.1 and FAR Subpart 37.6, DFARS Subpart 212.1 and DFARS Subpart 237.6 are removed.

FOR FURTHER INFORMATION CONTACT: Panoptic Enterprises at 703-451-5953 or by e-mail to Panoptic@FedGovContracts.com.

Copyright 2004 by Panoptic Enterprises. All Rights Reserved.

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