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method clearly in the best interest of the Government. The fact that no free publicity is available as described in paragraph (a) of § 1-2.203–3 does not mean that paid advertisements are appropriate. If paid advertisements are deemed to be clearly in the best interest of the Government, they shall be contracted for in accordance with the following procedures:

(1) Posts shall issue Form FS-455 in advance of publication to purchase advertising space. The following special information and conditions shall be included on the face of Form FS 455, Form FS-455a or the specification sheets attached thereto:

(i) The advertisement to be published.

(ii) A complete description of the advertisement, including type, size, arrangement, space, and publication dates.

(iii) A stipulation that the price charge shall not be higher than the conmercial rate charged to private individuals, with the usual discounts.

NOTE: This does not preclude the responsibility of contracting officers to secure lower terms at special rates whenever obtainable.

(iv) A stipulation that (2) marked copies of each issue of the publication containing the advertising shall be submitted with the vendor's invoice. (If not obtainable gratis, the cost of furnishing copies of the publication, as distinct from the cost of the advertisement space, shall be included as a separate item on Form FS-455). On receipt of the vendor's invoice and the two copies of the publication for each date published, there shall be clipped from each copy the name of the publication, the date of publication and the advertisement. Each complete set of the clippings shall be permanently attached to plain sheets of bond paper. One set of clippings for each date of publication shall be attached to the original copy of Form FS455, and the other set shall be attached to the paying office copy. $ 6–2.205 Bidders mailing lists. $ 6–2.205-1 Establishment of lists.

(b) The Industrial Readiness Planning Program is not applicable to procurement by the Department outside the United States. National Security Act of 1947 (50 U.S.C. 404); 32A CFR DMOVII-7.

(c) Standard Form 129 (Bidder's Mailing List Application) is not required to be used by posts. Subpart 6-2.4-Opening of Bids and

Award of Contract § 6–2.402 Opening of bids.

After the bids have been opened, and read aloud to the bidders present, an announcement shall be made that the opening of bids has been completed, and that, where feasible, all bidders will be notified as soon as conveniently possible regarding the award. $ 6-2.404 Rejection of bids.

If all of the bids for any item have been rejected, the contracting officer may readvertise for that item using the same specifications or modified specifications, or may negotiate under the circumstances discussed in $$ 1-3.210 and 1-3.214. $ 6-2.406 Mistakes in bids.

(a) The Assistant Secretary for Administration is authorized to make the determinations under FPR 1-2.406–3 and 1–2.406-4 which shall be approved by the Legal Advisor's Office.

(b) In doubtful cases under FPR 1-2.406-3(e) or where an administrative determination is precluded by the limitations of FPR 1-2.406–4, a request for the decision of the Comptroller General will be submitted by the Supply and Transportation Services Division through the Legal Advisor's Office. (31 F.R. 6623, May 4, 1966, as amended at 35 F.R. 1237, Jan. 30, 1970) $ 6–2.406–2 Apparent clerical mistakes.

In addition to the example set forth in § 1-2.406–2, an obvious mistake in extension of unit prices shall be considered an apparent clerical mistake. $ 6-2.407-5 Other factors to be consid

ered. See $ 6-11.301. $ 6–2.407-7 Statement and certificate of

award. (a) Standard Form 1036 (Statement and Certificate of Award) shall be used in connection with each contract made by formal advertising to evidence compliance with $ 1-2.103. An original and at least one copy of Standard Form 1036 shall be prepared. The original standard Form 1036 shall accompany and be distributed with the original of the contract. One confirmed copy of the Standard Form 1036 shall be retained in the contract file. Item 2(a) of Standard Form 1936 shall be filled in by inserting the number of prospective bidders to whom invitations for bids were distributed. In other respects, Standard Form 1036 shall be prepared as prescribed thereon, and in such details as to contain the information required by $ 1–2.407-7(b). § 6-2.407–8 Protests against award.

(a) While a case involving a protest before award is pending in the office of the Comptroller General, no award may be made under FPR 1-2.407-8(b) (3) without the prior approval of the Chief, Supply and Transportation Services Dlvision, or, in the case of overseas posts, the Principal Oficer of the post. The request for approval will include complete documentation of the determination to make the award.

(b) The Chief, Supply and Transportation Services Division (or the Principal Oficer), shall notify the Comptroller General of the intent to make the award and request advice as to the status of the case. A copy of such notice shall be given to the Contracting Officer. The Chief, Supply and Transportation Services (or the Principal Officer), shall notify the Contracting Officer of his approval or disapproval of the determination to make award.

(c) When a written protest is lodged with the Contracting Officer after award, the Contracting Officer will furnish the protestor a written explanation of the basis for the award. (31 F.R. 6623, May 4, 1966)

Sec. 6-3.213 Technical equipment requiring

standardization and Intar

changeability of parts. Subpart 6–3.3—Determinations, Finding, and

Authorities 63.301 Scope of subpart. 6-3.302 Determinations and Andings ro

quired. 6-3.305 Form and requirements of do

terminations and indings. 6-3.308 Preservation of data.

Subpart 6-3.4-Types of Contracts R 3.400 Scope of subpart. 63.404 Fixed-price contracts. 6-3.404-1 General. 6-3.404-2 Firm fixed-price contract. B3.404 3 Fixed-price contract with escala

tion. 63.4045 Prospective price redetermina

tion at & stated time or times

during performance. 63.406 Other types of contracts. 6-3.406–1 Time and materials contract. 6-3.406-2 Labor-hour contract. 63.406–50 Combination contract. -3.408 Letter contract. 63.409 Indefinite delivery type contracts. 6-3.410 Other types of agreements. 6-3.410-50 Price agreement. 6-3.410-51 Grant agreement. 63.450 Definite delivery type contracts. 6-3.451 Supply contracts. 6-3.452 Nonpersonal service contracts. 8 3.453 Construction contracts.


Subpart 6–3.6—Small Purchases 63.604 Imprest funds (petty cash)

method. -3.604 3 Agency responsibilities. 6-3.604-6 Procurement and payment. 6-3.605 Purchase order forms. 6-3.605-3 Agency order forms. 6–3.605-50 Unpriced purchase order. 6-3.606 Blanket purchase arrangements. 63.606-1 General 63.606-2 Authority to use blanket pur

chase arrangements. 23.606-3 Establishment of account. 6-3.606-4 Documentation.


NEGOTIATION Sec. 6-3.000 Scope of part.

Subpart 6-3.1-Use of Negotiation 6-3.101 General requirements for negoti

ation outside the United

Subpart 6-3.2-Circumstances Permitting

Negotiation 8-3.210 Impracticable to secure competi

tion by formal advertising.

Subpart 6-3.8—Price Negotiation Policies and

Techniques 8-3.814 Contract clauses.

AUTHORITY: The provisions of this part 63 Issued under sec. 205 (c), 68 Stat. 890, as amended, 40 U.S.C. 486(c); sec. 4, 68 Stat. 111, 22 U.S.C. 2658. 86-3.000 Scope of part.

(a) This part prescribes the policies and procedures applicable to procurement by negotiation by the Department

both in and outside the limits of the United States and its possessions. (30 F.R. 7247, May 29, 1966) Subpart 6-3.1-Use of Negotiation 86_3.101 General requirements for ne

gotiation outside the United States. (a) Procurement by negotiation may be effected under any of authorities and circumstances permitting negotiation in FPR 1-3.2.

(b) Formal advertising may be employed if its use is considered feasible and practicable under the conditions and circumstances of the procurement.

(c) Competitive solicitation shall be used to the maximum extent consistent with the procurement in accordance with FPR 1-3.101 (c) and (d).

(d) The authority to be cited on the Standard Form 1036 (Statement and Certificate of Award), or other document, in all negotiated procurement shall be the applicable section of FPR 1-3.2 except that all such procurement not in excess of $2,500 shall cite the authority of FPR 1-3.203 and procurement under FPR 1-3.215 (otherwise authorized by law) shall cite as authority the applicable law authorizing negotiation. (30 F.R. 7247, May 29, 1965) Subpart 6-3.2-Circumstances

Permitting Negotiation & 6–3.210 Impracticable to secure com

petition by formal advertising. (a) Application. (1) Section 321 of the Transportation Act of 1940 (49 U.S.C. 65) is not applicable to procurement outside the United States except to the U.S. portion of a shipment made to an oversea destination and to shipments between two points in the United States that pass through a foreign country.

(2) It is the policy of the Department not to require formal advertising in connection with procurement outside the United States, when competition by formal advertising is contrary to the locally accepted method of doing business. (30 F.R. 7247, May 29, 1966) 863.213 Technical equipment requir

ing standardization and interchange

ability of parts. (a) Policy. It is the Department's policy to utilize the negotiation authority

contained in section 302(c) (13) of the Act (41 U.S.C. 252(c) (13)) wherever standardization of technical equipment to be purchased in the United States for use in the Foreign Service is necessary in the public interest. This policy cannot be implemented in individual cases until it has first been determined by the Department that: The public interest would be best served by standardization due to special situations or particular localities in which the equipment is to be used; the equipment is in fact technical equipment; and procurement without formal advertising is necessary. All three determinations must be based upon findings of fact by the posts or offices concerned.

(b) Application. In order to assist posts in identifying the "special situations and particular localities” where standardization might be justified there follow several examples:

(1) A "Particular locality" might be a post that is remote from available sources of supply for parts or necessary repair services.

(2) Special situations might be ones in which:

(i) For security or other reasons, it is necessary for maintenance to be performed by U.S. citizen employees.

(11) For reasons other than remoteness of locality, it is necessary for parts to be stockpiled by the Government.

(i) Costs of either parts or repair services are prohibitive in the absence of standardization.

(c) Justification. Since standardization is an exception to a general policy of formally advertised procurement within the United States, it can be justified by the Department only when failure to standardize will result in significantly increased costs or interference with a vital program.

(d) Limitations. (1) Posts, or Regional Supply Centers on a regional basis, that consider standardization justifiable on a “particular locality" basis should report findings of fact concerning the following:

(1) The distance from the nearest adequate source of supply for parts for all known American makes of the particular type of equipment.

(ii) The distance from the nearest adequate source of service for all known American makes of the particular type of equipment.

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(iii) The number of units of each make or brand of the equipment on hand.

(iv) The recommended choice of make or brand to be standardized upon in accordance with post consideration of the following factors:

(a) Local service capability.
(6) Local parts availability and cost.

(c) Suitability of various makes under local conditions.

(d) Availability of parts or service from U.S. Government sources.

(e) Standardization by other U.S. Government agencies at the post or in the host country.

(f) Present equipment inventory by make.

(g) Price.

(h) Probable future trends of the factors in this subdivision.

(2) Any post or Departmental office that considers standardization justifiable on a "special situation" basis should fully describe the situation in a report to the Supply and Transportation Services Division including the recommended choice of make or brands to be standardized upon in accordance with consideration of the factors in subparagraph (1) (iv) of this paragraph insofar as they apply.

(e) Determinations and findings. Upon receipt of requests for standardization accompanied by findings of fact upon which ultimate determinations may be based, the Supply and Transportation Services Division will prepare formal determinations for approval. Submitting posts or Departmental offices will be notified of approval and, if standardization is approved, will be advised of the period for which it is effective. (32 F.R. 3936, Mar. 10, 1967) Subpart 6–3.3–Determinations,

Findings, and Authorities $ 6-3.301 Scope of subpart.

(a) Formal written findings and determinations (F&D) shall be made in accordance with Subpart 1-3.3 of Part 1-3 of this title and this subpart. (31 F.R. 6623, May 4, 1966) $ 6–3.302 Determinations and findings

required. (a) Findings and determinations made under the following sections of this title

are to be prepared for the signature of the Assistant Secretary for Administration and submitted for review through the Chief, Supply and Transportation Division:

(1) Experimental, developmental, or research work in excess of $25,000 under FPR 1-3.211.

(2) Purchase not to be publicly disclosed for reasons of national security under FPR 1-3.212.

(3) Technical equipment requiring standardization and interchangeability of parts under FPR 1-3.213.

(4) Omission of the Examination of Records Clause from negotiated contracts with foreign contractors and foreign subcontractors under Subpart 1-6.10 of this title.

(b) F&D made under the following sections of this title are to be prepared for the signature of the Chief, Supply and Transportation Services Division:

(1) Experimental, developmental, or research work not exceeding $25,000 under FPR 1-3.211.

(2) The use of a cost, cost-plus-afixed-fee, (or incentive-type contract outside the United States under FPR 1-3.405–1.

(c) Authority to make F&D under the following sections of this title is delegated to the contracting officers and shall be executed by such contracting officers within the contracting authority delegated to them:

(1) National emergency under FPR 1-3.201.

(2) Public exigency under FPR 13.202.

(3) Impracticable to secure competition by formal advertising under FPR 1-3.210.

(4) The rejection of all bids and negotiation after advertising under FPR 13.214.

(5) The use of a cost, cost-plus-afixed-fee, or incentive-type contract within the United States under FPR 1-3.405-1.

(6) The estimated cost and fees to be paid under a cost-plus-a-fixed-fee contract as required by FPR 1-3.302(a).

(7) The authorization and approval of advance payments under FPR 1-30.405 and unusual progress payments under 1-30.505 (a).

(8) The waiving of the requirement for submission of cost and pricing data

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under FPR 1-3.807-3(b) (2) and waiving the use of the clauses in FPR 1-3.814-1 through 1-3.814–3. (31 F.R. 6623, May 4, 1966, as amended at 35 F.R. 1237, Jan. 30, 1970; 36 F.R. 20512, Oct. 23, 1971) 8 6–3.305 Form and requirements of de

terminations and findings. (a) Each F&D shall include a description of the property or services being procured and, except for class determinations, the estimated cost including, when applicable, statement of the fee. The findings shall include all facts which are relevant to the determination or determinations being made. The extent of competition and potential sources shall be shown or, if no competition is intended, the basis for the decision. The reasons for selecting a particular method of contracting must be explained.

(b) The determination or determinations must be a clear and concise statement of the decision reached and must clearly identify the specific individual purchase or contract.

(c) Class determinations may be made for a period not in excess of 6 years and shall be reviewed annually. (31 F.R. 6624, May 4, 1966) $ 6-3.308 Preservation of data.

(a) The original of class F&D under 6–3.302(a) (3) will be retained by the Chief, Supply and Transportation Services Division with facsimile copies to the preparing office and contracting officer.

(b) The originals of all other F&D with supporting documents shall be filed in the procurement office contract file. Overseas posts shall file one copy of the F&D with the General Accounting Office copy of the contract. 131 F.R. 6624, May 4, 1966) Subpart 6–3.4 Types of Contracts

SOURCE: The provisions of this Subpart 6–3.4 appear at 33 F.R. 4674, Mar. 19, 1968, unless otherwise noted. & 6-3.400 Scope of subpart.

This subpart provides for the types of contracts which are authorized for use outside the United States. To the extent provided for, it also applies to contracts for performance within the United States. § 6–3.404 Fixed-price contracts.

8 6–3.404–1 General.

(a) Description. This type of contract may provide for pricing on the basis of either:

(1) Units of the items, supplies or services being procured (often referred to as “end-product" contracts); or

(2) Effort or time expended in the performance of the contract (sometimes referred to as “level-of-effort” contracts).

(b) Application. The fixed-price contract (without incentive provisions) provides the only type of contract pricing authorized for use outside the United States. The end-product_variant, described in paragraph (a) (1) of this section, should be used when feasible because it provides maximum contractor performance motivation. § 6–3.404–2 Firm fixed-price contract.

Application. Firm fixed pricing shall always be used for performance outside the United States unless lower base prices can be obtained by the use of fixed prices with escalation or redetermination provisions. An example of a use for this type of contract might be for equipment procured with a foreign currency in excess supply. $ 6–3.404–3 Fixed-price contract with

escalation. (a) Application. Use of this type of adjustable pricing in contracts for performance outside the United States is usually appropriate only in supply or service contracts of either indefinite or multiple delivery types wherein existing or anticipated market instability, due to identifiable factors, inhibits the negotiation of prices or rates firm for the entire performance period of the contract. An example of the necessity for price escalation provisions is an indefinite delivery contract at a post for gasoline, priced in a currency subject to unusual inflationary pressures. An example of the use of labor escalation provisions would be an annual contract for janitorial services at a post in a country with a rapidly rising cost of living. Labor escalation provisions should be based, when possible, on specific rates or indices recognized locally.

(b) Limitations. This type of contract shall not be used unless:

(1) A simple formula or provision is included in the contract which will op

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