of Government officers and employees, every person in each department who is charged with the administration and expenditure of Government funds must refrain from such conduct as would interfere with the full, proper, and impartial discharge of his official duties, or as would give rise to a reasonable suspicion that his conduct was motivated by selfinterest rather than by the best interests of the Government.

(b) Air Force Regulation 70-5 is incorporated in these procedures by reference. Heads of procuring activities will insure that a copy of Air Force Regulation 70-5 is furnished to each person, both military and civilian, engaged in procurement activities.

(c) No member of the Department of the Air Force, military or civilian, may act as an agent of the United States Government in advising, recommending, making, or approving the purchase or disposition of supplies or other property, or in contracting therefor, if such person may be admitted to share or receive directly or indirectly any pecuniary profit or benefit from such purchase or contract.

(d) No member of the Department of the Air Force, military or civilian, shall be in direct charge of the negotiation of, or exercise authority for the final approval of, any contract with any corporation, joint-stock company, association, or firm, if at any time within 2 years prior to taking such action, the person was employed by or engaged in a course of substantial non-Governmental business dealings with the corporation, jointstock company, association, or firm.

(1) The Under Secretary of the Air Force is authorized to make exemptions to the policy referred to in paragraph (d) of this section, in cases where he considers the application of the policy impracticable and does not serve the best interests of the Government.

§ 1000.306 Hospitalization and medical care for contractor's employees at oversea installations. (a) Under existing statutes and procurement regulations, the Military Departments have the authority, under certain circumstances, to contract for the hospitalization and medical care of employees of contractors with the United States at oversea locations, as a part of the consideration for such contracts.

(b) During the present shortage of medical personnel, all practicable means should be employed to reduce the workload of the medical departments of the services and to make the most efficient use of available personnel. Accordingly, in negotiating such contracts, it is requested that all procurement authorities in the Military Departments be instructed to avoid conditions which would place upon the services the responsibility of providing medical and dental care and hospitalization for contractors' employees; except where isolation and lack of civilian facilities for hospitalization or economic advantage to the Government become overriding factors of importance.

(c) This policy does not apply to preventive medical functions overseas, which should remain the responsibility of the Military Departments.

(d) In negotiating contracts, all procurement personnel will avoid, to the extent possible, including conditions which would place upon the services the responsibility of providing medical and dental care (out patient), and hospitalization (in patient) for contractor's employees at oversea locations. [18 F. R. 6260, Oct. 1, 1953]

§ 1000.307 Neutrality Act (International Traffic in Arms)—(a) Basic law. Section 12 of the act of November 4, 1939 (54 Stat. 10; 22 U. S. C. 452), also referred to as the "Neutrality Act of 1939," established the National Munitions Control Board, upon the recommendation of which the President was authorized to proclaim, from time to time, a list of articles which shall be considered arms, ammunition and implements of war for the purpose of said act. The Secretary of State promulgates rules and regulations with regard to said act and except where otherwise provided by law, the administration was vested in the Department of State. The Neutrality Act further provides for the registration of persons engaged in manufacturing, exporting, or importing any arms, ammunition, or implements of war listed in the President's Proclamation; and that no purchase of arms, ammunition, or implements of war shall be made on behalf of the United States from any person who shall have failed to register under provision of said act.

(b) Proclamation of the President. The President, in Proclamation 2776,

March 26, 1948 (13 F. R. 1623; 3 CFR 1948 Supp., p. 31), has proclaimed the articles which are considered arms, ammunition, and implements of war for purposes of the basic law as follows:

Category I-Small arms and machine guns

Rifles, carbines, revolvers, pistols, machine pistols, and machine guns (using ammunition of caliber .22 or over); barrels, mounts, breech mechanisms, and stocks therefor.

Category II—Artillery and projectors

Guns, howitzers, cannon, mortars, and rocket launchers (of all calibers), military filame throwers, military smoke, gas, or pyrotechnic projectors; barrels, mounts, and other components thereof.

Category III—Ammunition

Ammunition of caliber .22 or over for the arms enumerated under categories I and II above; cartridge cases, powder bags, bullets, jackets, cores, shells (excluding shotguns); projectiles and other missiles; percussion caps, fuses, primers, and other detonating devices for such ammunition.

Category IV-Bombs, torpedoes, and rockets

Bombs, torpedoes, grenades, rockets, mines, guided missiles, depth charges, and components thereof; apparatus and devices for the handling, control, discharge, detonation, or detection thereof.

Category V-Fire control equipment and range finders

Fire control equipment, range, position and height finders, spotting instruments, aiming devices (gyroscopic, optic, acoustic, atmospheric, or flash), bombsights, gunsights, and periscopes for the arms, ammunition, and implements of war enumerated in Proclamation 2776.

Category VI-Tanks and ordnance vehicles

Tanks, armed or armored vehicles, armored trains, artillery and small arms repair trucks, military half-tracks, tank recovery vehicles, tank destroyers; armor plate, turrets, tank engines, tank tread shoes, tank bogie wheels, and idlers therefor.

Category VII-Poison gases and toxicological agents

All military toxicological and lethal agents and gases; military equipment for the dissemination and detection thereof and defense therefrom.

Category VIII-Propellants and explosives Propellants for the articles enumerated in categories III, IV, and VII; military high explosives.

Category IX-Vessels of war

Vessels of war of all kinds, including amphibious craft, landing craft, naval tenders, naval transports, and naval patrol craft,

(c) Interpretation of basic law by Department of State. Munitions Division Bulletin 1, Department of State, "New Requirements Relating to the Licensing for Export and Import of Articles Defined as Arms, Ammunition, and Implements of War," April 1, 1948, indicated the procedures to be followed by those engaged in the business of manufacturing, exporting, or importing any of the arms, ammunition, or implements of war enumerated in the President's Proclamation pending issuance of a revised edition of the pamphlet "International Traffic in Arms." Inquiries relative to the application of Proclamation 2776 should be submitted to the Munitions Division, Department of State, Washington 25, D. C.

(d) Registration of certain manufacturers. The Chief, Munitions Division, Department of State, has advised that:

The Department of State is of the opinion that the following, among others, are not obligated to register as manufacturers under the terms of the act:

(1) Producers or suppliers of articles or equipment, of common military use, but not specifically listed in Proclamation 2776.

(2) Producers or suppliers of small parts or components of the articles or major units enumerated in Proclamation

2776,

when

such small parts or components have been interpreted as coming outside the purview of the Proclamation.

(3) Persons or firms engaged solely in research and development with resultant production for experimental or scientific purposes, when such production is not followed by manufacture in quantity for sale.

(4) Producers or suppliers of articles classified from the standpoint of military security if such articles are not adaptable to "use in warfare" in the sense of direct or indirect combat operations.

(5) Persons or firms engaged solely in the manufacture of arms, ammunition, and implements of war outside the jurisdiction of the United States.

In connection with the foregoing, it is my understanding that an administrative determination by the Department of State that a particular person or firm is not obligated to register under the provisions of the act will serve to relieve procurement officers of the Military Establishment of any responsibility in so far as applying the conditions of subsection (g) in their dealings with persons seeking military contracts, providing such persons present a statement by the Department of State expressing such an exemption. It is further understood that the foregoing arrangement is acceptable to the Office of the Comptroller General.

In cases of persons or firms required to register, they will be authorized to present in evidence thereof either a photostatic copy of their Certificate of Registration, or a statement from the Department certifying that they are registered, to that part of the Military Establishment from which they desire to obtain manufacturing or supplying contracts.

(e) Contract clause. The contract clause prescribed for insertion in contracts subject to the provisions of the basic law is set forth in Part 7 of this title.

[15 F. R. 8971, Dec. 16, 1950, as amended at 18 F. R. 6260, Oct. 1, 1953]

§ 1000.308 Robinson-Patman Act. The Attorney General has expressed the opinion that the act of October 15, 1914 (38 Stat. 730) as amended by the act of June 19, 1936 (49 Stat. 1526; 15 U. S. C. 12 et seq.), commonly referred to as the Robinson-Patman Act is not applicable to Government contracts for supplies (38 Op. Atty. Gen. 539). If a prospective bidder inquires concerning the application of the Robinson-Patman Act, he should be referred to the opinion of The Attorney General cited above.

§ 1000.309 Classified procurements; check list. Department of Defense Form 254, "Security Requirements Check List" will be used in precontract negotiations

when applicable for procurements by formal advertising and by negotiation, when contractors and subcontractors must have access to classified matter. This form will be prepared in accordance with the instructions thereon and will accompany all contracts and subcontracts classified top secret, secret, confidential, or restricted, and all contracts and subcontracts involving access to classified matter by a contractor or subcontractor. In addition to the initial completion of the form, necessary changes in security classification will be made as appropriate and will be reflected on the form when down-grading action is taken in compliance with applicable regulations. This form shall not be considered a part of the contract but shall be used to implement the "Military Security Requirements Clause" and any secrecy agreement which may be existent.

[16 F. R. 2794, Mar. 30, 1951]

§ 1000.310 Unauthorized release of procurement information. All personnel of the Air Force, both military and civilian, are responsible for refraining from releasing to individual business concerns or their representatives any preknowledge such personnel may possess or have acquired in any way concerning procurements or purchases of supplies by any procuring activity of the Air Force. Such information will be released to all potential contractors at the same time, as far as possible, and only through duly designated agencies, so that one potential contractor may not be given an unfair advantage over another.

[16 F. R. 2794, Mar. 30, 1951]

§ 1000.312 Place of delivery—(a) Domestic shipments. Unless there are valid reasons to the contrary (such as, but not restricted to, industry practice, applicability of State taxes, or destination unknown) the procurement of supplies for delivery within the continental United States will be in accordance with the following policy:

(1) When it is estimated that any shipment to a single destination will not equal a minimum carload or truckload lot (a minimum lot shall be considered to weigh approximately 20,000 pounds), delivery will be made on the basis of all transportation charges paid to destina

tion.

(b) Oversea shipments. In case of supplies destined for overseas, wherever possible, regardless of the quantity of the shipment, delivery will be made on the basis of f. o. b. carrier's equipment, or wharf, or freight station (at the Government's option), at or near contractor's plant, at a specified city or shipping point. Oversea shipments include those supplies shipped direct to a port area for export or to storage areas for subsequent reshipment to a port area for export.

[18 F. R. 6260, Oct. 1, 1953]

tinue to be used in appropriate cases, but not when such use will adversely affect the acceleration of procurement or the broadening of the industrial base contemplated by this directive.

313032-55-22

The Military Departments should pay particular attention to:

(a) The greatest possible integration of current procurement contracts with the industrial mobilization program and the accepted schedules of production.

(b) The equitable distribution of procurement contracts among the maximum number of competent suppliers. The concentration of contracts with a few leader suppliers is to be avoided unless the necessity therefor is clear.

(c) The utilization of existing open industrial capacity to the maximum. Expansion of facilities should not be authorized Whenwhen open capacity can be found. ever time permits, and in order to broaden the mobilization base, additional contractors should be utilized in lieu of multi-shift or overtime operation.

(d) The fullest possible use of small busi

ness concerns.

(e) The utilization in negotiation of competition and multiple awards, whenever possible.

(f) The aggressive encouragement or requirement of subcontracting by prime contractors.

(g) The provision of maximum incentive of the producer for the reduction of his costs.

(h) The placement of contracts with a view to economies in the use of transportation facilities.

(1) The availability of manpower in distressed employment areas or in areas of manpower shortages.

(1) The reservation of special skills and abilities for the more difficult production tasks.

To the extent necessary, Departmental procurement procedures and practices should be modified to conform to the foregoing. Particular attention should be paid to the caliber of personnel engaged in the negotiation of contracts.

(Signed) G. C. MARSHALL. [16 F. R. 2794, Mar. 30, 1951]

§ 1000.314 Synopses of proposed procurements-(a) Statement of policy. (1) The policy of the Military Departments is that all unclassified, negotiated, and advertised procurements exceeding $10,000 made in the continental United States be publicized, except:

(i) Research and development projects which are not susceptible of accomplishment by small business.

(ii) Procurements for studies or surveys.

(iii) Major items, of equipment, such as tanks, engines, airframes, ships, and