Subpart 7-3.8-Price Negotiation Policies and Techniques

§ 7-3.805

Selection by ICA of offerors for negotiation and award. ICA's procedure in negotiated procurements, after receipt of initial proposals, is as follows:

(a) From among those satisfactorily qualified prospective contractors submitting responsive proposals, the contracting officer, after giving due consideration to such elements as fee, overhead and other costs, shall select that contractor whose proposal offers the most adequate assurance (either explicit or implied) of satisfactory accomplishment of the desired objective.

(b) Where the contracting officer concludes that the responsive proposals initially received (or a substantial proportion of them) include cost elements which are too high to be acceptable, he shall review the invitation to determine whether it should be clarified, modified or amended for the purpose of eliciting more realistic proposals. If so, he shall issue such clarification, modification or amendment to all prospective contractors, offering them equal opportunity to revise their proposals. If revised proposals are not solicited in accordance with the foregoing, or if revised proposals are solicited but are still unacceptable, all proposals may be rejected by the contracting officer or further negotiations may be conducted as follows:

(1) If one prospective and qualified contractor has submitted the substantially lowest responsive proposal, that contractor may be selected for further negotiation.

(2) If two or more prospective and qualified contractors have submitted responsive proposals which are substantially lower than the others and which are close enough so that moderate price reductions might make one of them clearly the lowest, further negotiations may be conducted with that group of prospective contractors.

(3) Whenever negotiations are being conducted with more than one contractor, successively or otherwise, all contractors participating in such negotiations should be offered an equitable opportunity to submit such revisions in their proposals as may result from the negotiations. However, auction tech

niques are to be avoided. No one may be given another price to meet. All prospective contractors should be informed that after the submission of final costs and prices, no information will be furnished until an award has been made.

(4) No information regarding a proposal or the number or identity of contractors participating in the negotiations, should be made available to the public or to anyone who need not know for official duty.

§ 7-3.808-5 Subcontracting for services.

The price negotiation policies and techniques set forth in FPR 1-3.808-5 are generally applicable to ICA subcontracting. Additionally, it is ICA policy to control all subcontracting for service requirements under ICA prime service contracts. ICA requires its prime service contractors to obtain advance approval of the selection of subcontractors and the terms of all subcontracts whenever the cost of the prime contract (normally a cost-reimbursement type) may be affected by the terms of the subcontract. Advance approval of the selection of a subcontractor to perform services under a cost-reimbursement type or a fixedprice type prime contract may also be required whenever the quality of performance under the subcontract is, in the opinion of ICA, deemed important to effective completion of the prime contract. Whenever subcontract services are to be performed in a Cooperating Country, ICA requires approval of the selection of the subcontractor, the terms of the subcontract and of the personnel to be employed thereunder. ICA prime contracts which include any service requirements shall, insofar as practicable, anticipate all required subcontracting for services and contain provision therefor in accord with the foregoing policy and requirements. For example, ICA costreimbursement type prime contracts contain a standard clause prohibiting the contractor from subcontracting for any required services except as specifically authorized in the contract or as authorized in advance in writing by the Contracting Officer. In approving the selection of subcontractors and the terms of subcontracts, ICA normally applies the same tests and criteria that it applies in selecting and negotiating with its prime contractors.

(b) The term "Contracting Officer" means the person executing this contract on behalf of the Government, and any other office or civilian employee who is a properly designated Contracting Officer; and the term includes, except as otherwise provided in this contract, the authorized representative of a Contracting Officer acting within the limits of his authority.

(c) Except as otherwise provided in this contract, the term "subcontracts" includes purchase orders under this contract.

§ 7-7.101-2 Changes.

CHANGES

The Contracting Officer may at any time, by a written order, and without notice to the sureties, make changes, within the general scope of this contract, in any one or more of the following: (1) Drawings, designs, or specifications, where the supplies to be furnished are to be specially manufactured for the Government in accordance therewith; (11) method of shipment or packing; and (iii) place of delivery. If any such change causes an increase or decrease in the cost of, or the time required for, the performance of any part of the work under this contract, whether changed or not changed by any such order, an equitable adjustment shall be made in the contract price or delivery schedule, or both, and the contract shall be modified in writing accordingly. Any claim by the Contractor for adjustment under this clause must be asserted within 60 days from the date of receipt by the Contractor of the notification or change: Provided, however, That the Contracting Officer, if he decides that the facts justify such action, may receive and act upon any such claim asserted at any time prior to final payment under this contract. Where the cost of property made obsolete or excess as a result of a change is included in the Contractor's claim for adjustment, the Contracting Officer shall have the right to prescribe the manner of disposition of such property. Failure to agree to any adjustment shall be a dispute concerning a question of fact within the meaning of the clause of this contract entitled "Disputes". However, nothing in this clause shall excuse the Contractor from proceeding with the contract as changed.

not disposed of by agreement, shall be decided by the Contracting Officer, who shall reduce the decision to writing and mail or otherwise furnish a copy thereof to the Contractor. The decision of the Contracting Officer shall be final and conclusive unless within 30 days from the date of receipt of such copy, or such greater time as the Contracting Officer may specify in his decision, the Contractor mails or otherwise furnishes to the Contracting Officer a written appeal addressed to the Secretary. The decision of the Secretary or his duly authorized representative for the determination of such appeals shall be final and conclusive unless determined by a court of competent jurisdiction to have been fraudulent, or capricious, or arbitrary, or so grossly erroneous as necessarily to imply bad faith, or not supported by substantial evidence. In connection with any appeal proceeding under this clause, the Contractor shall be afforded an opportunity to be heard and to offer evidence in support of its appeal. Pending final decision of a dispute hereunder, the Contractor shall proceed diligently with the performance of the contract and in accordance with the Contracting Officer's decision.

(b) This "Disputes" clause does not preclude consideration of law questions in connection with decisions provided for in paragraph (a) above: Provided, That nothing in this contract shall be construed as making final the decision of any administrative official, representative, or board on a question of law.

§ 7-7.101-14 Buy American Act.

The clause set forth in FPR 1-7.101-14 shall not be included in ICA contracts. (See Executive Order No. 10784 dated October 1, 1958.)

§ 7-7.101–15 Convict labor.

The clause set forth in FPR 1-12.203 shall be included in all invitations to bid with the explanation that it shall be applicable only in contracts involving the employment of labor within the United States.

§ 7-7.101-19 Officials not to benefit. OFFICIALS NOT TO BENEFIT

No Member of the United States Congress, or United States Resident Commissioner, shall be admitted to any share or part of this contract, or to any benefit that may arise therefrom; but this provision shall not be construed to extend to this contract if made with a corporation for its general benefit.

The following clause shall be included in ICA fixed-price supply contracts:

WORKMEN'S COMPENSATION INSURANCE (a) Except as this contract may provide exclusively for the furnishing of materials or supplies, the Contractor before commencing performance under this contract shall provide and thereafter maintain Workmen's Compensation Insurance or security as is required by the Defense Base Act, as amended (United States Public Law 208, 77th Congress, as amended, 42 U.S.C. 1651 et seg.), for all employees engaged in performance of work under the contract outside the continental United States who are or were hired in the United States or who are American citizens or bona fide residents of the United States.

(b) For all other employees of the Contractor who are engaged in performance of work under the contract outside the continental United States (other than those who are or were hired in the United States or who are American citizens or bona fide residents of the United States), the contractor shall, pursuant to the applicable law of the country in which such work is performed, provide security for compensation benefits for injury to or death of such employees sustained in the course of such employment, or in the absence of such law, adequate employer's liability insurance.