[Federal Register: May 16, 2000 (Volume 65, Number 95)]
[Proposed Rules]               
[Page 31131-31132]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]



Defense Logistics Agency

48 CFR Parts 5433 and 5452

DLA Acquisition Directive: Alternative Dispute Resolution

AGENCY: Defense Logistics Agency (DLA), Defense.

ACTION: Proposed rule.


SUMMARY: This proposed rule would add a new provision to DLA 
solicitations concerning the use of alternative dispute resolution 
(ADR). The purpose is to establish ADR as the initial dispute 
resolution method, except for certain circumstances, to increase 
cooperative problem solving and reduce litigation. The provision would 
be optional for offerors; however, if they agreed to the provision, 
both the contractor and DLA would be committed to use ADR except in 
limited circumstances. Increased use of ADR is consistent with the 
Administrative Dispute Resolution Act, the Federal Acquisition 
Regulation (FAR), and Departmental policy.

DATES: Comments due on or before June 15, 2000.

ADDRESSES: Send written comments to Ms. Mary Massaro, Defense Logistics 
Agency, DLSC-PPP, Headquarters Center, 8725 John J. Kingman Road, Suite 
3147, Fort Belvoir, VA 22060-6221, or via email to 

FOR FURTHER INFORMATION CONTACT: Ms. Mary Massaro, Procurement Analyst, 
Defense Logistics Agency, DLSC-PPP, at (703) 767-1366.

    A. Background. DLA is pursuing several initiatives to increase the 
use of ADR in resolving contract disputes. One way to increase use of 
ADR is for the parties to agree, as part of the contract, that they 
will use ADR before initiating litigation. This type of approach is 
used by DoD in partnering agreements and Agency-contractor ADR pacts.
    The proposed provision provides a vehicle for both parties to agree 
to use ADR. Offeror can opt out of the provision by checking the box if 
they do not want it in their contract in the event of award. Offerors 
can also propose alternate wording to tailor the language while 
retaining the concept. Despite the fact that wording can be 
individually negotiated, DLA is seeking public comments to arrive at 
optimal language and to partner with industry in developing this 
    B. Regulatory Flexibility Act. This proposed rule does not have a 
significant economic impact on a substantial number of small entities 
within the meaning of the Regulatory Flexibility Act, 5 USC 601 et seq. 
An initial regulatory flexibility analysis was not performed.
    C. Paperwork Reduction Act. This notice does not impose any new 
reporting or record keeping requirements that require the approval of 
OMB under 44 USC 3501 et seq.

List of Subjects in 48 CFR Parts 5433 and 5452

    Government procurement.
    For the reasons set forth above, the Defense Logistics Agency 
proposes to amend 48 CFR Chapter 54 as follows:
    1. Part 5433 is added to read as follows:


    Authority: 10 U.S.C. Chapter 137

Sec. 5433.214.  Contract Clause: Agreement to Use Alternative Dispute 

    The contracting officer shall insert the provision in 5452.233 in 
all solicitations unless the conditions at FAR 33.203(b) apply.


    2. The authority citation for Part 5452 continues to read as 

    Authority: 10 U.S.C. Chapter 137

    3. Part 5452 is amended by adding contract clause 5452.233-9001 to 
read as follows:

[[Page 31132]]

5452.233-9001 Disputes: Agreement to Use Alternative Dispute Resolution 
    As prescribed in 5433.214, insert the following clause:

xxx 2000)--DLAD

    (a) The parties agree to use their best efforts to resolve any 
disputes that may arise without litigation. If unassisted 
negotiations are unsuccessful, the parties will use ADR techniques 
in an attempt to resolve the dispute. Litigation will only be 
considered as a last resort when ADR is unsuccessful or has been 
documented by the party rejecting ADR to be inappropriate for 
resolving the dispute. If the ADR is not successful, the parties 
retain their existing rights.
    (b) If you wish to opt out of this clause, check here [ ]. 
Alternate wording may be negotiated with the contracting officer.

William J. Kenny,
Executive Director, Logistics Policy and Acquisition Management.
[FR Doc. 00-12106 Filed 5-15-00; 8:45 am]