[Federal Register: January 15, 2009 (Volume 74, Number 10)]
[Rules and Regulations]
[Page 2733-2739]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr15ja09-46]

-----------------------------------------------------------------------

DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 1, 7, 18, 28, 32, 33, 43, 50, and 52

[FAC 2005-30; FAR Case 2006-023; Item V; Docket 2007-0001; Sequence 8]
RIN 9000-AK75


Federal Acquisition Regulation; FAR Case 2006-023, SAFETY Act:
Implementation of DHS Regulations

AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Civilian Agency Acquisition Council and the Defense
Acquisition Regulations Council (Councils) have agreed to convert the
interim rule that published in the Federal Register at 72 FR 63027,
November 7, 2007 to a final rule. The final rule amends the Federal
Acquisition Regulation (FAR) to implement the Department of Homeland
Security (DHS) regulations on the SAFETY Act.

DATES: Effective Date: February 17, 2009.

FOR FURTHER INFORMATION CONTACT: Mr. Edward N. Chambers, Procurement
Analyst, at (202) 501-3221 for clarification of content. For
information pertaining to status or publication schedules, contact the
FAR Secretariat at (202) 501-4755. Please cite FAC 2005-30, FAR case
2006-023.

SUPPLEMENTARY INFORMATION:

A. Background

    DoD, GSA, and NASA published an interim rule in the Federal
Register at 72 FR 63027, November 7, 2007. Seven respondents submitted
comments on the interim rule. All respondents generally supported the
concepts of the FAR interim rule, but provided suggestions to improve
clarity and better achieve the implementation of the SAFETY Act.
    1. Definitions.
    a. Pre-qualification designation notice (50.201 and associated
clauses). In the definition ``pre-qualification designation notice''
one respondent suggested that the word ``successful'' prior to
``offeror'' be deleted because the interim rule allows all offerors to
submit streamlined SAFETY Act applications, not just the successful
offeror.
    Response: The Councils have accepted this suggestion and the
definition of ``pre-qualification designation notice'' has been
modified throughout the final rule.
    b. ``Block designation and ``block certification.'' One respondent
was concerned that there is no definition of the terms ``block
designation'' and block certification.''
    Response: These definitions were embedded within the definition of
``SAFETY Act designation'' and ``SAFETY Act certification.'' These
terms are now separately defined, to make it easier to locate the
definitions.
    2. General (50.203(a)).
    The respondent suggested that because SAFETY Act protections extend
to purchasers and users of technologies that the phrase in 50.203(a)(2)
be amended to reflect this.
    Response: Paragraph (a)(2) of the interim rule reads as follows:
    ``(2) Provide risk management and litigation management
protections for sellers of QATTs and others in the supply and
distribution chain.''
    Risk management and litigation management are addressed in section
864 and 863 of the SAFETY Act respectively, and in 6 CFR 25.5 and 25.7
of the DHS regulations. The required amount of liability insurance
purchased by the seller must provide protection for contractors,
subcontractors, suppliers, vendors, and customers of the Seller, as
well as contractors, subcontractors, suppliers, and vendors of the
customer, to the extent of their potential liability for involvement in
the manufacture, qualification, sale, use, or operation of the QATT.
See Section 864 of the SAFETY Act. Accordingly, the phrase, ``and
others in the supply and distribution chain,'' accurately reflects this
required coverage. Therefore, no change has been made to the rule as a
result of this comment.
    3. Policy (50.204).
    a. Benefits to the Government. The respondent thought that because
the SAFETY Act also benefits the Government with respect to its
potential liability, the requiring activities should not only encourage
contractors to submit SAFETY Act applications, but also support these
applications.
    Response: The subject of any benefit the Government may ultimately
enjoy with respect to a decreased liability is one that cannot be
addressed in the context of this FAR case. The implications are too far
reaching and would require a thorough analysis of many of the
Government's waivers of sovereign immunity. However, to the extent that
one of the criteria for the Department of Homeland Security (DHS) to
determine whether to issue a designation is a determination made by a
Federal, State, or local official that the technology is appropriate
for preventing, detecting, identifying, or deterring acts of terrorism
or limiting the harm such acts might cause, the FAR case has been
amended to specifically reflect this possibility in 50.204(a) by
changing the paragraph to read:
    50.204 Policy.
    (a) Agencies should--
    (1) Determine whether the technology to be procured is
appropriate for SAFETY Act protections and, if appropriate, formally
relay this determination to DHS for purposes of supporting
contractor application(s) for SAFETY Act protections in relation to
criteria (b)(viii) of 6 CFR 25.4, Designation of Qualified Anti-
Terrorism Technologies;
    b. Authorities and responsibilities. One respondent wanted to
clarify that determination of whether the SAFETY Act is applicable is
within the exclusive purview and discretion of DHS. The respondent
therefore recommended that the policy at 50.204(a)(1) should be revised
to replace ``should'' with ``shall consult with DHS to...''

[[Page 2734]]

    Response: It is not necessary in every circumstance to consult with
DHS to determine whether the SAFETY Act is applicable. The procedures
make it clear that in questionable cases the agency shall consult with
DHS (50.205-1(a)).
    c. Soliciting contingent offer. Another respondent thought that the
language of 50.204(b) concerning not soliciting offers contingent upon
SAFETY Act designation or certification before contract award was
incongruous with normal acquisition procedures to solicit offers before
award.
    Response: ``Before contract award'' refers to ``SAFETY Act
designation or certification'' not to ``shall not solicit offers.''
This can be clarified by adding a connecting word as follows:
    ``Agencies shall not solicit offers contingent upon SAFETY Act
award designation or certification occurring before contract award,
unless...''
    d. Responsibility to take action. One respondent requested that the
policy should address another responsibility, the responsibility to
take action once the determinations are made.
    Response: The additional language requested by the respondent is
not appropriate in the Policy section. These actions are addressed
under FAR 50.205 procedures.
    4. SAFETY Act considerations (50.205-1).
    a. SAFETY Act Applicability (50.205-1(a)).
    i. Several respondents questioned the use of the phrase ``requiring
activity'' and some thought it reasonable to include a definition for
``requiring activities.''
    Response: The use of this phrase is consistent with other uses in
the FAR and defining the term is outside the scope of this case.
    ii. One respondent wondered if the statement that ``Requiring
activities shall review requirements to identify potential
technologies'' means that all requirements must be so reviewed. This
respondent considered that it would be helpful if the FAR provided some
guidance as to the types of requirements that must be so reviewed, and
points to the summary of items at the beginning of FAC 2005-021, which
provided examples of the goods and services to which FAR Subpart 50.2
applies.
    Response: The Councils do not agree that it is advisable to provide
such a list in the regulations. Any such list would never be complete,
and could imply that technologies not on the list would not be covered
by the SAFETY Act. There are some limited examples in the definition of
Qualified Anti-Terrorism Technology (QATT), particularly of services
and analyses that may be considered technology. In addition, examples
of QATT are to be found on the SAFETY Act website identified at FAR
50.203(c) (e.g., see SAFETY Act 101 Briefing and Active Procurement
List).
    iii. One respondent recommended that the requiring activity's
determination of the existence of a block designation or certification
through discussions with DHS, must be mandatory (i.e., change
``should'' to ``shall''). In the same sentence, the respondent
recommended changing ``address through preliminary discussions'' to
``ascertain through discussions''. The respondent considered that this
change will ensure that if a block designation or certification exists,
it will be used in the procurement process.
    Response: The Councils do not concur with the change from
``should'' to ``shall'' because the FAR does not direct requiring
activities.
    However, the Councils do concur with the change from ``address
through preliminary discussions'' to ``ascertain through discussions,''
as being more precise. The existence of block designation or
certification must be ascertained at this time, not at some time in the
future. Therefore, these discussions are not preliminary.
    iv. One respondent recommended that the discussion not be limited
to ``block designations'' or ``block certifications.'' The respondent
stated that DHS regulations provide coverage for ``designated
technology,'' ``certified technology,'' and for Developmental Testing
and Evaluation Designation for any technology that is being developed.
Each of these additional technology designations should be ``on the
table'' when a Federal agency is considering whether a technology is
appropriate for SAFETY Act coverage.
    Response: The block designations and block certifications are
checked first because they are broader in scope, covering a class of
technologies. There may be a block designation or block certification
already in effect that can cover the planned acquisition.
    Although ``designated technology'' and ``certified technology'' are
specific to a particular technology, these designations are still ``on
the table.'' FAR 50.205-1(a)(2) directs the agencies to proceed to
50.205-2, pre-qualification designation notice, if a block designation
or block certification does not exist.
    With regard to the ``developmental testing and evaluation
designation,'' the DHS regulations established this category to cover
an anti-terrorism technology that is being developed, but that requires
additional developmental testing and evaluation (6 CFR 25.4(f)).
However, the determination to use this type of designation is one that
DHS may apply to a technology at its sole discretion. The pre-
qualification designation notice process does not expressly include
permitting a developmental testing and evaluation designation, but
rather is limited to stating presumptively or affirmatively that a
technology is a QATT. Therefore, while a developmental testing and
evaluation designation may result from any application, the FAR
language accurately reflects the different streamlined application
process and streamlined review times made available to various vendors.
    v. One respondent also suggested that the language in 50.205-
1(a)(1), ``the requiring activity shall inform the contracting officer
to notify offerors'', should be rewritten as ``the requiring activity
shall request that the contracting officer notify offerors.''
    Response: The Councils have accepted this suggestion as being
simpler and clearer.
    b. Early consideration of the SAFETY Act.
    i. One respondent recommended a cross reference to 7.105(b)(19) be
placed in 50.205(b).
    Response: The Councils concur.
    ii. The same respondent also requested that the regulations should
provide guidance on the lead time required for SAFETY Act coverage
determinations.
    Response: The regulation states at 50.205-1(b) that processing
times for issuing determinations on all types of SAFETY Act
applications vary depending on many factors, including the influx of
applications to DHS and the technical complexity of individual
applications. This statement continues to be true, and more specific
guidance is not possible.
    c. Reciprocal waiver of claims (d). One respondent supported the
statement in the rule that the Government is not a customer from which
a contractor must request a reciprocal waiver.
    Response: None required.
    5. Prequalification Designation Notice (PQDN) (50.205-2).
    a. PQDN after contract award. One respondent thought that the Pre-
Qualification Designation Notices (PQDNs) were not limited to any
particular time in the acquisition cycle and therefore, thought that
PQDNs should also be available after contract award.
    Response: In reviewing the DHS regulations on the issuance of
PQDNs,

[[Page 2735]]

there is nothing to indicate that the procedure relates to anything
other than the future procurement of a technology. See 6 CFR
25.6(g)(2). Further, the time periods of seeking a PQDN and a
contractor then applying under the streamlined rules versus simply
having the contractor apply for SAFETY Act protections would not
justify such a procedure. It would be far simpler for contractors to
apply for SAFETY Act protections themselves. The period for an
expedited review is 60 days. The review period for a PQDN is also 60
days. When added together, this is equal to the 120 days for an entire
SAFETY Act application. Of course, DHS may issue Block Designations
and/or Certifications and, therefore, if contractors or requiring
activities are interested in having DHS consider whether to issue a
Block Designation or Certification, then they should write the Under
Secretary of Science and Technology of DHS for this purpose.
    b. Specification changes after PQDN. One respondent thought that
the FAR case needed to be clarified with respect to specifications or
statements of work changing after a PQDN had been issued.
    Response: To the extent, that there may be confusion based on the
wording in the interim rule, 50.205-2(a) has been amended to read:
    (a) Requiring activity responsibilities. (1) If the requiring
activity determines that the technology to be acquired may qualify
for SAFETY Act protection, the requiring activity is responsible for
requesting a pre-qualification designation notice from DHS. Such a
request for a pre-qualification designation notice should be made
once the requiring activity has determined that the technology
specifications or statement of work are established and are unlikely
to undergo substantive modification. DHS will then ...
    c. Mandatory. With regard to the same paragraph (50.205-1(a)(1)),
the respondent requested that the language should be mandatory,
changing ``the requiring activity is responsible for requesting'' to
``the requiring activity shall request.''
    Response: The FAR provides direction to the contracting officer and
the contracting chain of command in an agency. The requiring activities
do not look to the FAR for direction.
    d. Streamlined methodology for technology already being sold to
Government. Several respondents felt that there should be a streamlined
methodology to apply and obtain SAFETY Act protections if contractors
are already selling existing technologies to the Government.
    Response: The DHS rules for applying for SAFETY Act protection do
not provide for a streamlined methodology to apply and obtain SAFETY
Act protection outside of the acquisition process. The FAR cannot
provide for any additional methodology without DHS changing its rules
on the manners in which to seek SAFETY Act protections. It should be
emphasized though that contractors may, like any sellers of
technologies, submit an application for SAFETY Act protections at any
time. While the timelines for a traditional application are longer, the
timelines are not expected to exceed an additional two months.
    6. Contingent offers (50.205-3 and Alt I to 52.250-3 and 52.250-4).
    a. Market research (50.205-3(a)(3)). One respondent thought the
language in 50.205-3(a)(3) was unclear because this subparagraph did
not specifically state who would perform the ``market research.'' The
respondent thought the requirement for market research should be
deleted because it would be difficult for contracting officers to
obtain reliable information and because market research will be
subjective and can result in widely divergent and inequitable
implementation of the contingent and presumptive SAFETY Act clauses.
Prior to submission of an offer, a company may not be in a position to
make a categorical decision as to whether to supply technology without
SAFETY Act coverage.
    Response: FAR Part 10 clearly requires that the market research be
performed by the contracting officer. Therefore, no change is required
to this subparagraph.
    It is Government policy to allow contingent offers only if market
research shows that there will be insufficient competition without
SAFETY Act protections or the subject technology would be sold to the
Government only with SAFETY Act protections. With regard to
subjectivity and widely divergent implementation, it is believed that
the direction in FAR Part 10 provides enough guidance so as to protect
against such a situation. However, it is recognized, as with any
process, different employees will pursue a matter differently. This
cannot be avoided.
    b. Block certification. One respondent would prefer that the
regulations not limit contracting officers from authorizing offers
contingent on obtaining a SAFETY Act certification unless a block
certification applies to the solicitation. (Also at 50.205-4(b).)
    This respondent also recommended that the wording should be
``applies to the technology'' rather than ``applies to the
solicitation.''
    Response: DHS would not grant SAFETY Act certification unless a
block certification existed, or unless the offeror already has applied
for a SAFETY Act designation. Otherwise, DHS would first grant a
designation, and subsequently grant a certification after the
technology is proven, or simultaneously grant a designation and a
certification, if requested by the applicant. In any event, a SAFETY
Act designation will be part of any SAFETY Act protections conferred to
a contractor. In virtually every circumstance, the Government will
consider that to be sufficient protection to proceed to award.
    The Councils have changed the wording at 50.205-3(b) and 50.205-
4(b) to read ``applies to the class of technology to be acquired under
the solicitation.''
    c. No conditions. Several respondents suggested, with respect to
accepting contingent offers, that no conditions or very limited
conditions should be placed on a contracting officer's ability to
accept contingent offers.
    Response: Without analyzing the long-standing precedent of the
Government not accepting contingent offers of any kind, the conditions
placed on the acceptance of an offer contingent upon an offeror
obtaining SAFETY Act designation or certification are very reasonable.
The dual nature of the SAFETY Act application processes and the source
selection processes makes it inherently risky for the Government to
accept contingent offers. However, in light of the importance of using
the SAFETY Act effectively, it was deemed worthwhile to accept the risk
of permitting contingent offers, but only if certain conditions
applied. Accordingly, this case had to mitigate the Government's risk
in allowing contingent offers by including such conditions.
    d. Right of the Government to award. Several respondents were
concerned that paragraphs (f)(2) and (f)(3) of Alternate I to 52.250-3
and 50.250-4 are in conflict with each other, or at best, unclear.
    Response: The Councils have rewritten paragraphs (f)(2) and (f)(3)
to clarify that the right of the Government to award prior to
resolution of the offeror's application for SAFETY Act designation
would be an award on another offer, not the contingent offer.
    7. Provision prescriptions (50.206).
    a. 52.250-2, SAFETY Act Coverage Not Applicable.
    i. One respondent recommended clarifying the coverage in FAR
50.206(a)(2) by adding before the period in the sentence the following
phrase: ``and no block designation or block

[[Page 2736]]

certification applies to the technology to be acquired. See 50.205-
1(a).''
    Response: It would not be possible to get to this point if there
were a block designation or block certification. The first
consideration to be checked under the procedures at FAR 50.205-1(a) is
whether or not there is a block designation or block certification. It
is only if one does not exist that the agency would enter into
discussions with DHS as to whether this technology might be a good
candidate for a PQDN.
    ii. The respondent also considered this clause prescription to be
unclear, questioning whether 52.250-2 would be included if the agency
based its determination of non-applicability of the SAFETY Act on its
own, without DHS consultation, and wanting the FAR to make this clear.
The respondent also reiterates that inclusion of a list of examples of
items to which the SAFETY Act may be applicable would be helpful in
determining whether to include the provision in the solicitation.
    Response: The Councils consider that the FAR has made it very clear
that this clause would only be used after consultation with DHS--either
as specified in FAR 50.206(a)(1) or (a)(2). As stated in section 4.a,
there are various sources of examples of products that may be suitable
for SAFETY Act protection. However, whenever there is any possibility
of applicability, DHS must be consulted.
    b. 52.250-3, SAFETY Act Block Designation/ Certification. One
respondent stated that it would be helpful to provide information on
how to ascertain whether or not DHS has issued a block designation or
certification.
    Response: When DHS grants a block designation or block
certification, it will be listed on the SAFETY Act website (see
50.203(c)). Even though there are currently no block designations or
certifications, DHS has been requested to provide a place on the
website now, so that it can be verified that there are currently no
block designations or block certifications. The website is currently
operational.
    c. 52.250-3 and -4, Alternate II. One respondent recommended
revision of 50.206(b)(3) and (c)(3) so that contracting officers can
only increase the 15 day time period for submission of SAFETY Act
applications, not decrease it. For some companies, it may not be
feasible to submit an application in less than 15 days.
    Response: The Councils concur and have revised the text
accordingly.
    8. ``SAFETY Act Coverage not applicable'' (52.250-2).
    Two respondents thought that this provision should be eliminated.
One respondent thought that the provision at 52.250-2 could lead to
unintended consequences by not specifically limiting the provision to
the products or services being acquired under the solicitation. The
respondent felt that the wording of the provision might lead potential
SAFETY Act applicants to believe that their technologies would never be
appropriate for SAFETY Act protection. The respondent believed that
this provision conflicts with the SAFETY Act, which confers exclusive
authority on DHS to determine whether SAFETY Act application should be
approved or denied. Another respondent stated that an offeror should
still be precluded from seeking SAFETY Act coverage. If the provision
is not removed, the respondent suggested narrowing of the applicability
of the statements of inapplicability.
    Response: Offerors should be informed if DHS has advised the agency
that the SAFETY Act is not applicable or has denied approval of a pre-
qualification designation notice. However, to the extent that the
wording of the provision might cause some confusion, the Councils have
reworded the provision as follows:
    ``The Government has determined that for purposes of this
solicitation the product(s) or service(s) being acquired by this
action are neither presumptively nor actually entitled to a pre-
determination that the products or services are qualified anti-
terrorism technologies as that term is defined by the Support Anti-
terrorism by Fostering Effective Technologies Act of 2002 (SAFETY
Act), 6 U.S.C. 441-444. This determination does not prevent sellers
of technologies from applying for SAFETY Act protections in other
contexts. Proposals in which either acceptance or pricing is made
contingent upon SAFETY Act designation as a qualified anti-terrorism
technology or SAFETY Act certification as an approved product for
homeland security of the proposed product or service will not be
considered for award. See Federal Acquisition Regulation subpart
50.2.''
    9. SAFETY Act Prequalification Designation Notice (52.250-4). One
respondent suggested that the language in 52.250-4(d) be amended to
more accurately reflect the difference between a determination granting
a SAFETY Act application and solicitation specifications.
    Response: The language in 52.250-4(d) has been amended to more
accurately reflect these differences. This amended language is set
forth as follows:
    (d) All determinations by DHS are based on factors set forth in
the SAFETY Act, and its implementing regulations. A determination by
DHS to issue a SAFETY Act designation, or not to issue a SAFETY Act
designation for a particular technology as a QATT is not a
determination that the technology meets, or fails to meet, the
requirements of any solicitation issued by any Federal, state,
local, or tribal governments. Determinations by DHS with respect to
whether to issue a SAFETY Act designation for technologies submitted
for DHS review are based on the factors identified in 6 CFR Section
25.4(b).
    10. Alternate II to 52.250-3 and 52.250-4.
    a. Insurance requirements and ``good faith''. One respondent
suggested that the contractor should have the flexibility to negotiate
the insurance requirements based on DHS's grant of a designation or
certification.
    One respondent wanted the insurance requirement in the FAR removed
for a different reason, as well as the requirement that the offeror
pursues its application in ``good faith.'' The respondent is concerned
that DHS has the exclusive statutory and regulatory authority for
implementing the SAFETY Act, including establishment and enforcement of
requirements for securing designation or certification, and provides
consequences if the company does not agree to the insurance
requirements. Furthermore, only DHS can address the question of whether
a seller is pursuing an application in ``good faith.''
    Response: The respondent's comment cannot be addressed through
regulations in the FAR. The insurance required by DHS is based in
statute and the implementing DHS regulations. Any flexibility with
regard to DHS's required amounts of insurance is a part of DHS's
analysis when reviewing a particular SAFETY Act application and is not
a subject of negotiation during a contract award.
    Although the Councils concur that DHS is the agency that imposes
the insurance requirements and can determine if an application is being
pursued in good faith, nevertheless, it would be irresponsible to award
a contract to an offeror with a presumption that designation will be
received, if these conditions are not met.
    b. Limited scope of SAFETY Act applications. Paragraph (f)(2) of
Alternate II to 52.250-3 and 52.250-4 requires the offeror to file a
SAFETY Act designation (or SAFETY Act certification) application,
limited to the scope of the applicable block designation (or
certification) or pre-qualification designation notice, in order to be
eligible for award. The respondent was concerned that this limitation
could have harsh results, precluding award where an offeror's
technology may provide a more robust solution than definitively
required. The

[[Page 2737]]

respondent considered that the potential exclusion of technologies
outweighs the need to expedite the procurement process.
    Response: Alternate II puts the Government in the unusually risky
position of awarding a contract presuming that SAFETY Act coverage will
be granted after award, and agreeing to negotiate an equitable
adjustment if that does not occur. The Government only agrees to this
alternate when certain conditions are met, including the fact that DHS
has already issued a block designation or a block certification, or a
pre-qualification designation notice for the solicited technology.
Considering the risk involved in these circumstances, the Government
cannot afford the additional risk that would be generated if the
offeror then proposes a technology that is outside or beyond the scope
of the technologies that have been already block designated or
certified by DHS or reviewed and either affirmatively or presumptively
endorsed by DHS as technologies that meet the criteria of the SAFETY
Act. Without these assurances in advance, the Government cannot afford
the risk of presuming that SAFETY Act designation or certification will
be granted after contract award.
    c. Before or after award. One respondent questioned why the clause
at FAR 52.250-4, Alternate II, paragraph (f)(1) addresses submission of
proposals presuming SAFETY Act coverage ``before or after'' award, but
the heading at 50.205-4 states ``presuming SAFETY Act designation or
certification after contract award.''
    Response: At the time proposals are submitted, it is not yet known
if SAFETY Act coverage will be received before or after award. If
SAFETY Act coverage is received before award, there is no issue.
However, if award must be made and SAFETY Act coverage has not yet been
granted, then the special conditions must apply because award must be
made based on the presumption that SAFETY Act coverage will be granted
after award.
    11. SAFETY Act--Equitable Adjustment (52.250-5).
    a. Several respondents suggested that as part of the equitable
adjustment clause at 52.250-5 the contractor should be allowed to stop
work unilaterally.
    Response: This suggestion is contrary to long standing Government
procurement law and procedures and therefore, will not be considered
further as part of this case. The contractor is not forced to submit an
offer.
    b. One respondent had a concern that under Alternate II, award can
be made and delivery required, prior to receipt of SAFETY Act coverage.
The respondent suggested modification of 52.250-5 to allow delayed
delivery, without penalty, until SAFETY Act coverage is granted.
    Response: This suggestion is inconsistent with the reasons for
using this Alternate. The reason for proceeding to award under this
alternate is based on a presumption of receiving SAFETY Act coverage
after award. Therefore, the risk would have to be weighed against the
urgency to award a contract. If delay would be acceptable, then there
is no need to accept the risk of awarding a contract based on a
contingency. In this case, it would be better to use Alternate I
instead of Alternate II, and not make the award until the issue of
SAFETY Act coverage is resolved.
    c. One respondent wanted clarification of the meaning of ``a
dispute in accordance with the ``Disputes'' clause of this contract.''
    Response: The Councils consider that ``in accordance with the
`Disputes' clause of this contract'' in paragraph (d)(3) of the clause
is sufficiently clear.
    12. Comments on Subpart 50.1.
    a. One respondent made the statement that the changes in FAR
50.102-3 to the procedures for an Agency to exercise the authority
under paragraph 1A of E.O. 10789 would reduce the number of
indemnifications granted.
    Response: This may well be true. However, these procedures
implemented as part of this rule reflect the transfer and delegation of
certain functions to, and other responsibilities vested in, the
Secretary of DHS, which stem directly from Executive Order 13286 and
therefore, cannot be changed by this case.
    b. The respondent also commented on other sections in Subpart 50.1.
    Response: The interim rule republished existing language because of
the massive renumbering of the sections. Renumbering is not a
substantive change. The intention of this rulemaking was to take
comments solely relating to the Safety Act. Therefore, comments on
sections containing existing language where only the numbering was
changed are outside the scope of this case.
    13. SAFETY Act Block Designation/Certification (52.250-3). Two
respondents suggested that the SAFETY Act Certification is not a
certification provided by the contractor and thus the provisions of the
case should be placed in Section L of contracts and not Section K.
    Response: This comment is accepted and the appropriate changes will
be made in the clause matrix. A SAFETY Act Certification is a
certification issued by DHS, not by the offerors.
    This is not a significant regulatory action and, therefore, was not
subject to review under Section 6(b) of Executive Order 12866,
Regulatory Planning and Review, dated September 30, 1993. This rule is
not a major rule under 5 U.S.C. 804.

B. Regulatory Flexibility Act

    The Department of Defense, the General Services Administration, and
the National Aeronautics and Space Administration certify that this
final rule will not have a significant economic impact on a substantial
number of small entities within the meaning of the Regulatory
Flexibility Act, 5 U.S.C. 601, et seq., because this rule imposes no
burdens on businesses. Instead, it allows businesses to more easily
take advantage of a Department of Homeland Security regulation
published June 8, 2006, at 6 CFR part 25. The Department of Homeland
Security certified in their rule that there would be no significant
impact on a substantial number of small entities. The Councils did not
receive any comments on the Regulatory Flexibility Act or a perceived
burden on small business.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply. These changes to the
FAR do not impose additional information collection requirements to the
paperwork burden previously approved under OMB Control Numbers 1640-
0001 through 1640-0006, under applications made to OMB by the
Department of Homeland Security.

List of Subjects in 48 CFR Parts 1, 7, 18, 28, 32, 33, 43, 50, and
52

    Government procurement.

    Dated: December 24, 2008.
Edward Loeb,
Acting Director, Office of Acquisition Policy.

0
Interim Rule Adopted as Final With Changes
0
Accordingly, the interim rule amending 48 CFR parts 1, 7, 18, 28, 32,
33, 43, 50, and 52 which was published in the Federal Register at 72 FR
63027 on November 7, 2007, is adopted as a final rule with the
following changes:

0
1. The authority citation for 48 CFR parts 1, 7, 18, 28, 32, 33, 43,
50, and 52 continues to read as follows:

    Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42
U.S.C. 2473(c).

[[Page 2738]]

PART 50--EXTRAORDINARY CONTRACTUAL ACTIONS AND THE SAFETY ACT

0
2. Amend section 50.201 by--
0
a. Adding, in alphabetical order, the definitions ``Block
certification'' and ``Block designation'';
0
b. Amending the definition ``Pre-qualification designation notice'' by
removing the word ``successful''; and
0
c. Revising the definitions ``SAFETY Act certification'' and ``SAFETY
Act designation''.
0
The added and revised text reads as follows:


50.201  Definitions.

* * * * *
    Block certification means SAFETY Act certification of a technology
class that the Department of Homeland Security (DHS) has determined to
be an approved class of approved products for homeland security.
    Block designation means SAFETY Act designation of a technology
class that the DHS has determined to be a Qualified Anti-Terrorism
Technology (QATT).
* * * * *
    SAFETY Act certification means a determination by DHS pursuant to 6
U.S.C. 442(d), as further delineated in 6 CFR 25.8 and 25.9, that a
QATT for which a SAFETY Act designation has been issued is an approved
product for homeland security, i.e., it will perform as intended,
conforms to the seller's specifications, and is safe for use as
intended.
    SAFETY Act designation means a determination by DHS pursuant to 6
U.S.C. 441(b) and 6 U.S.C. 443(a), as further delineated in 6 CFR 25.4,
that a particular Anti-Terrorism Technology constitutes a QATT under
the SAFETY Act.

0
3. Amend section 50.203 by adding a sentence to the end of paragraph
(c) to read as follows:


50.203  General.

* * * * *
    (c) * * * Included on this website are block designations and block
certifications granted by DHS.

0
4. Amend section 50.204 by revising paragraph (a)(1); and amending
paragraph (b) by removing the word ``certification'' and adding
``certification occurring'' in its place. The revised text reads as
follows:


50.204  Policy.

    (a) * * *
    (1) Determine whether the technology to be procured is appropriate
for SAFETY Act protections and, if appropriate, formally relay this
determination to DHS for purposes of supporting contractor
application(s) for SAFETY Act protections in relation to criteria
(b)(viii) of 6 CFR 25.4, Designation of Qualified Anti-Terrorism
Technologies;
* * * * *

0
5. Amend section 50.205-1 by revising the introductory text of
paragraph (a) and paragraph (a)(1); and amending paragraph (b) by
removing the word ``possible'' and adding ``possible (see FAR
7.105(b)(19)(v))'' in its place. The revised text reads as follows:


50.205-1  SAFETY Act Considerations.

    (a) SAFETY Act applicability. Requiring activities should review
requirements to identify potential technologies that prevent, detect,
identify, or deter acts of terrorism or limit the harm such acts might
cause, and may be appropriate for SAFETY Act protections. In
questionable cases, the agency shall consult with DHS. For acquisitions
involving such technologies, the requiring activity should ascertain
through discussions with DHS whether a block designation or block
certification exists for the technology being acquired.
    (1) If one does exist, the requiring activity should request that
the contracting officer notify offerors.
* * * * *

0
6. Amend section 50.205-2 by adding a new sentence after the first
sentence in paragraph (a)(1) to read as follows:


50.205-2  Pre-qualification designation notice.

    (a)(1) * * * Such a request for a pre-qualification designation
notice should be made once the requiring activity has determined that
the technology specifications or statement of work are established and
are unlikely to undergo substantive modification. * * *
* * * * *

0
7. Amend section 50.205-3 by revising paragraph (b) to read as follows:


50.205-3  Authorization of offers contingent upon SAFETY Act
designation or certification before contract award.

* * * * *
    (b) Contracting officers shall not authorize offers contingent upon
obtaining a SAFETY Act certification (as opposed to a SAFETY Act
designation), unless a block certification applies to the class of
technology to be acquired under the solicitation.

0
8. Amend section 50.205-4 by revising paragraph (b) to read as follows:


50.205-4  Authorization of awards made presuming SAFETY Act designation
or certification after contract award.

* * * * *
    (b) Contracting officers shall not authorize offers presuming that
SAFETY Act certification will be obtained (as opposed to a SAFETY Act
designation), unless a block certification applies to the class of
technology to be acquired under the solicitation.


50.206  [Amended]

0
9. Amend section 50.206 in paragraphs (b)(3) and (c)(3) by removing the
word ``alter'' and adding the word ``increase'' in its place.

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
10. Amend section 52.250-2 by revising the date of the provision and
the provision to read as follows:


52.250-2  SAFETY Act Coverage Not Applicable.

* * * * *

SAFETY ACT COVERAGE NOT APPLICABLE (FEB 2009)

    The Government has determined that for purposes of this
solicitation the product(s) or service(s) being acquired by this
action are neither presumptively nor actually entitled to a pre-
determination that the products or services are qualified anti-
terrorism technologies as that term is defined by the Support Anti-
terrorism by Fostering Effective Technologies Act of 2002 (SAFETY
Act), 6 U.S.C. 441-444. This determination does not prevent sellers
of technologies from applying for SAFETY Act protections in other
contexts. Proposals in which either acceptance or pricing is made
contingent upon SAFETY Act designation as a qualified anti-terrorism
technology or SAFETY Act certification as an approved product for
homeland security of the proposed product or service will not be
considered for award. See Federal Acquisition Regulation subpart
50.2.

    (End of provision)

0
11. Amend section 52.250-3 by--
0
a. Revising the date of the provision;
0
b. In paragraph (a) by--
0
1. Adding, in alphabetical order, the definitions ``Block
certification'' and ``Block designation''; and
0
2. Revising the definitions ``SAFETY Act certification'' and ``SAFETY
Act designation'';
0
c. Revising paragraph (d);
0
d. Amending paragraph (e) by removing the word ``room'' and adding the
word ``Room'' in its place;
0
e. In Alternate I by revising the date of the alternate and paragraphs
(f)(2) and (f)(3); and
0
f. In Alternate II by revising the date of the alternate; and amending
paragraph (f)(2)(iii) by removing the

[[Page 2739]]

word ``any'' and adding ``the offeror's'' in its place.
0
The added and revised text reads as follows:


52.250-3  SAFETY Act Block Designation/Certification.

* * * * *

SAFETY ACT BLOCK DESIGNATION/CERTIFICATION (FEB 2009)

    (a) * * *
* * * * *
    Block certification means SAFETY Act certification of a
technology class that the Department of Homeland Security (DHS) has
determined to be an approved class of approved products for homeland
security.
    Block designation means SAFETY Act designation of a technology
class that the DHS has determined to be a Qualified Anti-Terrorism
Technology (QATT).
* * * * *
    SAFETY Act certification means a determination by DHS pursuant
to 6 U.S.C. 442(d), as further delineated in 6 CFR 25.9, that a QATT
for which a SAFETY Act designation has been issued is an approved
product for homeland security, i.e., it will perform as intended,
conforms to the seller's specifications, and is safe for use as
intended.
    SAFETY Act designation means a determination by DHS pursuant to
6 U.S.C. 441(b) and 6 U.S.C. 443(a), as further delineated in 6 CFR
25.4, that a particular Anti-Terrorism Technology constitutes a QATT
under the SAFETY Act.
* * * * *
    (d) All determinations by DHS are based on factors set forth in
the SAFETY Act and its implementing regulations. A determination by
DHS to issue a SAFETY Act designation, or not to issue a SAFETY Act
designation for a particular technology as a QATT is not a
determination that the technology meets, or fails to meet, the
requirements of any solicitation issued by any Federal, State, local
or tribal governments. Determinations by DHS with respect to whether
to issue a SAFETY Act designation for technologies submitted for DHS
review are based on the factors identified in 6 CFR 25.4(b).
* * * * *

    Alternate I (FEB 2009). * * *

    (f)(1) * * *
    (2) If an offer is submitted contingent upon receipt of SAFETY
Act designation (or SAFETY Act certification, if a block
certification exists) prior to contract award, then the Government
may not award a contract based on such offer unless the offeror
demonstrates prior to award that DHS has issued a SAFETY Act
designation (or SAFETY Act certification, if a block certification
exists) for the offeror's technology.
    (3) The Government reserves the right to award the contract
based on a noncontingent offer, prior to DHS resolution of the
offeror's application for SAFETY Act designation (or SAFETY Act
certification, if a block certification exists).

    Alternate II (FEB 2009). * * *
* * * * *

0
12. Amend section 52.250-4 by--
0
a. Revising the date of the provision;
0
b. In paragraph (a) by--
0
1. Adding, in alphabetical order, the definitions ``Block
certification'' and ``Block designation'';
0
2. Removing from the definition ``Pre-qualification designation
notice'' the word ``successful''; and
0
3. Revising the definitions ``SAFETY Act certification'' and ``SAFETY
Act designation'';
0
c. Revising paragraph (d);
0
d. In Alternate I by revising the date of the alternate and paragraphs
(f)(2) and (f)(3); and
0
e. In Alternate II by revising the date of the alternate; and amending
paragraph (f)(2)(iii) by removing the word ``any'' and adding ``the
offeror's'' in its place.
0
The added and revised text reads as follows:


52.250-4  SAFETY Act Pre-qualification Designation Notice.

* * * * *
    SAFETY ACT PRE-QUALIFICATION DESIGNATION NOTICE (FEB 2009)

    (a) * * *
* * * * *
    Block certification means SAFETY Act certification of a
technology class that the Department of Homeland Security (DHS) has
determined to be an approved class of approved products for homeland
security.
    Block designation means SAFETY Act designation of a technology
class that the DHS has determined to be a Qualified Anti-Terrorism
Technology (QATT).
* * * * *
    SAFETY Act certification means a determination by DHS pursuant
to 6 U.S.C. 442(d), as further delineated in 6 CFR 25.9, that a QATT
for which a SAFETY Act designation has been issued is an approved
product for homeland security, i.e., it will perform as intended,
conforms to the seller's specifications, and is safe for use as
intended.
    SAFETY Act designation means a determination by DHS pursuant to
6 U.S.C. 441(b) and 6 U.S.C. 443(a), as further delineated in 6 CFR
25.4, that a particular Anti-Terrorism Technology constitutes a QATT
under the SAFETY Act.
* * * * *
    (d) All determinations by DHS are based on factors set forth in
the SAFETY Act and its implementing regulations. A determination by
DHS to issue a SAFETY Act designation, or not to issue a SAFETY Act
designation for a particular Technology as a QATT is not a
determination that the Technology meets, or fails to meet, the
requirements of any solicitation issued by any Federal, State, local
or tribal governments. Determinations by DHS with respect to whether
to issue a SAFETY Act designation for Technologies submitted for DHS
review are based on the factors identified in 6 CFR 25.4(b).
* * * * *

    Alternate I (FEB 2009). * * *

    (f)(1) * * *
    (2) If an offer is submitted contingent upon receipt of SAFETY
Act designation prior to contract award, then the Government may not
award a contract based on such offer unless the offeror demonstrates
prior to award that DHS has issued a SAFETY Act designation for the
offeror's technology.
    (3) The Government reserves the right to award the contract
based on a noncontingent offer, prior to DHS resolution of the
offeror's application for SAFETY Act designation.

    Alternate II (FEB 2009). * * *
* * * * *

0
13. Amend section 52.250-5 by--
0
a. Revising the date of the clause;
0
b. In paragraph (a) by--
0
1. Adding the definitions ``Block certification'' and ``Block
designation'' in alphabetical order; and
0
2. Revising the definitions ``SAFETY Act certification'' and ``SAFETY
Act designation''.
0
The added and revised text reads as follows:


52.250-5  SAFETY Act--Equitable Adjustment.

* * * * *

SAFETY ACT--EQUITABLE ADJUSTMENT (FEB 2009)

    (a) * * *
* * * * *
    Block certification means SAFETY Act certification of a
technology class that the Department of Homeland Security (DHS) has
determined to be an approved class of approved products for homeland
security.
    Block designation means SAFETY Act designation of a technology
class that the DHS has determined to be a Qualified Anti-Terrorism
Technology (QATT).
* * * * *
    SAFETY Act certification means a determination by DHS pursuant
to 6 U.S.C. 442(d), as further delineated in 6 CFR 25.9, that a QATT
for which a SAFETY Act designation has been issued is an approved
product for homeland security, i.e., it will perform as intended,
conforms to the seller's specifications, and is safe for use as
intended.
    SAFETY Act designation means a determination by DHS pursuant to
6 U.S.C. 441(b) and 6 U.S.C. 443(a), as further delineated in 6 CFR
25.4, that a particular Anti-Terrorism Technology constitutes a QATT
under the SAFETY Act.
* * * * *

[FR Doc. E9-577 Filed 1-14-09; 8:45 am]

BILLING CODE 6820-EP-S