Procedural requirements for gratuities hearings are set out in § 30.4 of this chapter.

[30 F.R. 5959, Apr. 29, 1965]

§ 1.112 Federal procurement regulations and General Services Administration regulations relating to procurement of supplies and services.

All policy and procedural matter of Federal Procurement Regulations (See Chapter I of Title 41) and General Services Administration regulations which are to be made applicable to the Department of Defense and are within the scope of this subchapter will be codified herein prior to compliance therewith by the Military Departments. The applicable Department of Defense Directives covering the assignments of responsibility for the purchasing of specific supplies under Interagency Purchase Assignment will be incorporated by reference in this subchapter. For Department of Defense implementation of Federal Supply Schedules, see § 5.103. [25 F.R. 12080, Dec. 31, 1960]

§ 1.113 Standards of conduct. [30 F.R. 5960, Apr. 29, 1965]

§ 1.113-1 Government personnel.

All governmental personnel engaged in procurement and related activities shall conduct business dealing with industry in a manner above reproach in every respect. Transactions relating to expenditure of public funds require the highest degree of public trust to protect the interests of the Government. While many Federal laws and regulations place restrictions on the actions of governmental personnel, the latter's official conduct must, in addition, be such that the individual would have no reticence about making a full public disclosure thereof. See AR 600-50 (Part 579 of this title), for the Army; SECNAV Instr. 5370.2D of June 29, 1966, for the Navy; AFR 3030, for the Air Force; and DSAR 5500.1, for the Defense Supply Agency. [33 F.R. 264, Jan. 9, 1968]

of Defense with respect to relationships with non-Federal institutions. Specifically, the Directive describes examples of various organizational conflicts of interest which might come into being, and rules for avoidance of such conflicts; and it provides that action must be taken to avoid placing a contractor in a position where his judgment might be biased or where he would have an unfair competitive advantage within the scope and intent of the rules. However, the Directive cannot of itself impose any obligations on the contractor; such obligations must be imposed by a contract clause designed to carry out the intent of the Directive. Furthermore, potential contractors must be advised in the solicitation as to the extent of applicability of the rules, and must be given an opportunity to negotiate on the terms of the clause and its application.

(b) (1) The contracting officer is responsible for applying the rules in the Directive to contracts under his cognizance and shall determine whether each proposed procurement is subject to the Directive.

(2) If the contracting officer initially determines with respect to a particular procurement that a potential conflict of interest exists, he shall, before issuing the solicitation, prepare a written analysis, including a statement as to which of the four rules (or other conflict of interest not stated in the rules) he considers applicable, and a recommended solicitation notice and clause designed to avoid the organizational conflict of interest. A standard form of solicitation notice or clause is not prescribed in this subchapter since such notices and clauses must be especially adapted to apply the principle of the rule to the specific facts of each contractual situation. The clause shall spell out the specific extent of any future restrictions on the contractor. The restrictions of the proposed clause shall also have a specific time period of effectiveness. As a general rule, the time effectiveness of any clause which excludes the contractor from participation in subsequent procurement shall have a fixed term of reasonable duration as appropriate, except that where Rule 1 of the Directive (§ 141.2(b) (1)) is involved the exclusion shall be permanent. A fixed term of reasonable duration is measured by the time required to avoid the circumstance of unfair competitive advantage. This is variable; for example, it may run to the date of award of the first produc

tion contract or for a stated period of time. (See Rules 2 and 3 (§ 141.2(b) (2) and (3) of this chapter). In no event shall an exclusion be stated in the clause without a specific date, or an event certain, terminating the effectiveness of the exclusion except where Rule 1 is involved.

(3) After approval by the Head of the Procuring Activity or his designee and before issuance of the solicitation, the contracting officer shall include the determination, together with the written analysis, in the negotiation file or record. The approved solicitation notice and proposed clause shall then be included in the solicitation, together with a clear statement that the proposed clause and the application of the Directive are subject to negotiation.

(4) In no case shall the clause included in a solicitation or in a contract (including letter contracts) pursuant to this section defer the determination of the application of the Directive to a time after the contract has been awarded.

(5) Where a contract contemplates a Rule 4 situation (§ 141.2(b) (4) of this chapter), it is incumbent on the contracting officer to assure himself that the agreement called for by Rule 4 is in fact executed, and that copies thereof are made available to the Government.

(c) The contracting officer shall not impose restrictions under the Directive in follow-on procurements on any prospective contractor in the absence of a specific contractual agreement with that contractor. If, during the effective period of any restriction, procurement responsibility for the system or item involved is transferred from the procuring activity which imposed the restriction that activity shall notify the transferee of the restriction and send it a copy of the contract under which it was imposed.

(d) The Departments shall maintain in accordance with Departmental procedures, and for an appropriate period of time as determined by the circumstances, a record of all solicitation notices and of all clauses incorporated in contracts pursuant to this section. [33 F.R. 264, Jan. 9, 1968]

§ 1.114 Reporting of identical bids.

(a) General. Executive Order 10936 dated April 24, 1961, as implemented by the Department of Justice, requires a report to be submitted to the Attorney General on each formally advertised procurement (including small business re

stricted advertising) over $10,000 which involves identical bids. Identical bids are two or more bids for the same line item which:

(1) Are identical on their face (regardless of evaluation factors such as discount, transportation, etc.) either as to unit price or total line item amount;

or

(2) Are identical as evaluated either as to unit price or total line item amount. A line item is an item of supply or service which independently can be made the subject of an award by the Government. However, the reporting requirements herein established for line items shall be applicable to invitations calling for line item bidding even though the invitations or bids contained qualifying or restrictive limitations on award (e.g., all or none bids or award on one item being conditioned on award of other items). This reporting requirement is in addition to the reports required by § 1.111-2.

(b) Information to be obtained from bidders. Each invitation for bids for a procurement estimated to exceed $10,000 shall include substantially the following: PARENT COMPANY AND EMPLOYER IDENTIFICATION NUMBER

(a) Bidder represents that he [ ] is, [ 1 is not, owned or controlled by a parent company. For this purpose a parent company is defined as one which either owns or controls his activities and basic business policies of the bidder. To own another company means the parent company must own at least a majority (more than 50 percent) of the voting rights in that company. To control another company such ownership is not required; if another company is able to formulate, determine or veto basic business policy decisions of the bidder, such other company is considered the parent of the bidder. This control may be exercised through the use of dominant minority voting rights, use of proxy voting, contractual arrangements, or otherwise.

(b) If the bidder is owned or controlled by a parent company, insert in the space below the name and main office address of the parent company.

identical bids are involved, one inquiry will be made in an effort to obtain the information. Failure to provide information concerning the parent company or the employer's identification number is not a basis for rejection of bids.

(c) Reportable bids. An identical bid report shall be submitted when identical bids are received and the bid value of all line items covered by the invitation for bids exceeds $10,000 (based on the apparent low bid for each line item) except that reports will not be submitted when:

(1) Bids are received only from foreign sources on invitations involving delivery and performance outside the United States, its possessions, or Puerto Rico;

(2) There is no line item on which the apparent low bids exceeds $2,500 (line item evaluation computations beyond those normally made to determine the low bidder are not required); or

(3) No identical bids are discovered in the normal process of evaluating bids for award and no identical bids are apparent on the face of the bid.

(d) Submission of reports. Identical bid reports shall be submitted for all reportable bids on Department of Justice Form DJ-1500 (Federal Stock No. 7540823-7870), available from General Services Administration stores depots. Instructions for filling out this form are printed as the cover sheet of each pad of these forms. Reports shall be made within 20 days following the disposition of all of one or more contracts or other action. Two completed copies of the report, a copy of the invitation for bids and a copy of the completed abstract of bids shall be sent to the Attorney General, Ref: AT-IBR, Washington 25, D.C. The abstract of bids need not be furnished when the number of line items on an invitation exceeds 100; in which event, the identical bid report shall be annotated to indicate (1) the number of line items and (2) the number of bidders on the invitation. A copy of the identical bid report shall be retained by the purchasing activity.

(e) Completion of reports. All bids for each line item on which reportable identical bids have been disclosed shall be reported regardless of whether the identical bids were the low bids. Reports are required on reportable identical bids regardless of whether an award is made on the line item, the invitation is

canceled, or any other disposition is made subsequent to the public opening of the invitation.

[27 F.R. 11643, Nov. 27, 1962]

§ 1.115

Noncollusive bids and proposals.

(a) In order to promote full and free competition for Government contracts, the following certification shall be included in all (1) invitations for bids and (2) requests for proposals or quotations (other than for small purchases made in accordance with Subpart F, Part 3 of this chapter; other than for solicitations issued by overseas purchasing offices which will result in contracts performed overseas by foreign suppliers; and other than requests for technical proposals in connection with two-step formal advertising) involving firm fixed-price contracts and fixed-price contracts with escalation. When the solicitation authorizes the submission of oral offers and requires that such offers be confirmed in writing, it shall require that the certification be included with or be expressly incorporated by reference in and thereby made a part of the confirmation.

CERTIFICATE OF INDEPENDENCE PRICE DETERMINATION (JUNE 1964)

(a) By submission of this bid or proposal, each bidder or offeror certifies, and in the case of a joint bid or proposal, each party thereto certifies as to its own organization, that in connection with this procurement:

(1) The prices in this bid or proposal have been arrived at independently, without consultation, communication, or agreement, for the purpose of restricting competition, as to any matter relating to such prices with any other bidder or offeror or with any competitor;

(2) unless otherwise required by law, the prices which have been quoted in this bid or proposal have not been knowingly disclosed by the bidder or offeror and will not knowingly be disclosed by the bidder or oferor prior to opening, in the case of a bid, or prior to award, in the case of a proposal, directly or indirectly to any other bidder or offeror or to any competitor; and

(3) no attempt has been made or will be made by the bidder or offeror to induce any other person or firm to submit or not to submit a bid or proposal for the purpose of restricting competition.

(b) Each person signing this bid or proposal certifies that:

(1) He is the person in the bidder's or offeror's organization responsible within that organization for the decision as to the prices being bid or offered herein and that he has not participated, and will not participate, in any action contrary to (a) (1) through (a) (3) above; or

(2) (a) He is not the person in the bidder's or offeror's organization responsible within that organization for the decision as to the prices being bid or offered herein but that he has been authorized in writing to act as agent for the persons responsible for such decision in certifying that such persons have not participated, and will not participate, in any action contrary to (a)(1) through (a) (3) above, and as their agent does hereby so certify; and (b) he has not participated, and will not participate, in any action contrary to (a) (1) through (a) (3) above.

(c) This certification is not applicable to a foreign bidder or offeror submitting a bid or proposal for a contract which requires performance or delivery outside the United States, its possessions, and Puerto Rico.

(d) A bid or proposal will not be considered for award where (a)(1), (a) (3), or (b) above has been deleted or modified. Where (a) (2) above has been deleted or modified, the bid or proposal will not be considered for award unless the bidder or offeror furnishes with the bid or proposal a signed statement which sets forth in detail the circumstances of the disclosure and the Secretary, or his designee, determines that such disclosure was not made for the purpose of restricting competition.

(b) The fact that a firm (1) has published price lists, rates, or tariffs covering items being procured by the Government, (2) has informed prospective customers of proposed or pending publication of new or revised price lists for such items, or (3) has sold the same items to commercial customers at the same prices being offered the Government does not constitute, without more, a disclosure within the meaning of paragraph (a) (2) of the Certificate.

(c) It is not required that a separate written authorization be given to the signer of the bid or proposal for each procurement involved where the signer makes the certification provided in paragraph (b) (2) of the Certificate, provided that with respect to any blanket authorization given, (1) the procurement to which the Certificate applies is clearly within the scope of such authorization, and (2) the person giving such authorization is the person responsible within the bidder's or offeror's organization for the decision as to the prices being bid or offered at the time the Certificate is made in a particular procurement.

(d) After the execution of an initial certificate and the award of a contract in connection therewith, the contractor need not submit additional certificates in connection with proposals submitted on

"work orders" or similar ordering instruments issued pursuant to the terms of that contract, where the Government's requirements cannot be met from another source.

(e) The authority to make the determination described in paragraph (d) of the above certification shall not be delegated to an official below the level of the head of a procuring activity.

(f) When a certification is suspected of being false or there is indication of collusion, the matter shall be processed in accordance with § 1.111. For rejection of bids which are suspected of being collusive and for the negotiation of procurements subsequent to such rejection, see §§ 2.404-1(b) (7) and 3.215 of this chapter.

[30 F.R. 5960, Apr. 29, 1960, as amended at 33 F.R. 264, Jan. 9, 1968]

Subpart B-Definitions of Terms 1.201

Definitions.

As used throughout this subchapter, the words and terms defined in this subpart shall have the meanings set forth in this subpart, unless (a) the context in which they are used clearly required a different meaning, or (b) a different definition is prescribed for a particular part or portion thereof.

[27 F.R. 11643, Nov. 27, 1962] § 1.201-1

Change order.

Change order means a written order signed by the contracting officer, directing the contractor to make changes which the changes clause of the contract authorizes the contracting officer to order without the consent of the contractor. (See §§ 16.103 and 16.813.) [32 F.R. 4242, Mar. 18, 1967] § 1.201-2

Contract modification.

Contract modification means any written alteration in the specification, delivery point, rate of delivery, contract period, price, quantity, or other contract provisions of an existing contract, whether accomplished by unilateral action in accordance with a contract provision, or by mutual action of the parties to the contract. It includes (a) bilateral actions such as supplemental agreements, and (b) unilateral actions such as change orders, administrative notices of the exercise of a contract changes, notices of termination, and option. [25 F.R. 14081, Dec. 31, 1960]

§ 1.201-3 Contracting officer.

"Contracting Officer" means any person who, either by virtue of his position or by appointment in accordance with procedures prescribed by this subchapter, is currently a contracting officer (see § 1.400) with the authority to enter into and administer contracts and make determinations and findings with respect thereto, or with any part of such authority. (NOTE: Recent assignments of contract administration responsibilities have necessitated a separation of duties related to procurement, with some duties normally performed at a purchasing office and some normally performed at a contract administration office. For convenience of expression, when requiring performance of specific duties by a contracting officer, this subchapter may refer to a contracting officer at the purchasing office as the procuring contracting officer (PCO), and to a contracting officer at a contract administration office as an administrative contracting officer (ACO). Additionally, a contracting officer, responsible for the settlement of terminated contracts, may be referred to as the termination contracting officer (TCO). It is recognized that a single contracting officer may be responsible for duties in any or all of these areas, and reference in this subchapter to PCO, ACO, or TCO does not of itself require that duty be performed at a particular office or activity or restrict in any way a contracting officer in the performance of any duty properly assigned. For example, a duty specified by this subchapter to be performed by the ACO will be performed by a contracting officer at the purchasing office when contract administration or responsibility for that duty has been retained in the purchasing office.)

[30 F.R. 11997, Sept. 21, 1965, as amended at 31 F.R. 1039, Jan. 27, 1966]

§1.201-4 Contracts.

"Contracts" means all types of agreements and orders for the procurement of supplies or services. It includes awards and notices of award; contracts of a fixed-price, cost, cost-plus-a-fixed-fee, or incentive type; contracts providing for the issuance of job orders, task orders or task letters thereunder; letter contracts, letters of intent, and purchase orders. It also includes amendments and supplemental agreements with respect to any of the foregoing.

[25 F.R. 14081, Dec. 31, 1960]

§ 1.201-5 Department and Military Department.

Department and Military Department include the Department of the Army, the Department of the Navy, the Department of the Air Force, the Defense Supply Agency, the Defense Communications Agency, and the Defense Atomic Support Agency.

[30 F.R. 5960, Apr. 29, 1965]

§1.201-6 Department of Defense.

"Department of Defense" comprises the Office of the Secretary of Defense and the military departments. [25 FR. 14081, Dec. 31, 1960]

§ 1.201-7 Head of a procuring activity.

"Head of a procuring activity" includes, for the Army, the chiefs of the technical services, the Zone of Interior Army commanders, the Chief of the National Guard Bureau, the Commanding General of the Military District of Washington, U. S. Army and the commanding generals of the major oversea commands; for the Navy, the Chief of each Bureau, the Chief of Naval Research, the Aviation Supply Officer, the Commander, Military Sea Transportation Service, and the Commandant of the United States Marine Corps; for the Air Force, the Commander, Air Materiel Command. It also includes the Executive Director of the Military Medical Supply Agency, the Executive Director of the Military Petroleum Supply Agency, and the head of any other procuring activity hereafter established. The number and designation of Heads of Procuring Activities within any military department may be changed by directive of the Secretary.

[25 F.R. 14081, Dec. 31, 1960]

§ 1.201-8 Includes.

"Includes" means "includes but is not limited to."

[25 F.R. 14081, Dec. 31, 1960] §1.201-9 Labor surplus area concern. See § 1.801-1.

[25 F.R. 14081, Dec. 31, 1960] §1.201-10 May.

May is permissive. words "no person may

However, the **" mean that

no person is required, authorized, or permitted to do the act prescribed.

[29 F.R. 6912, May 27, 1964]