§ 1-6.806-1 Restricted solicitation. (a) In the case of procurements other than those referred to in §§ 1-6.804(a) and 1-6.805, where the domestic cost is estimated to exceed $10,000, cost estimates of United States and foreign end products and services shall be made prior to solicitation (where one agency procures for another agency the requiring agency shall make the cost estimate). If the domestic cost is estimated to exceed the foreign cost by not more than 50 percent of the foreign cost, the solicitation shall be restricted to U.S. end products and services. (b) If after bid opening, or receipt of proposals or quotations, the contracting officer has knowledge that domestic cost exceeds foreign cost by more than 50 percent of the foreign cost, he shall proceed as follows: (1) Where the domestic cost is in excess of $10,000, forward the matter to the head of the agency or his designee for determination; or (2) Where the domestic cost is not in excess of $10,000, award the contract for U.S. end products or services unless the domestic and foreign cost differential is so large as to make the procurement of foreign end products or services clearly desirable. Should the latter be the case, the solicitation shall be canceled and a nonrestricted solicitation issued. (c) If the agency determines that the foreign end product or service shall be purchased, contracts for such procurements shall provide that the payment in dollars will be limited to the contractor's validated direct dollar costs of the U.S. export content of the procurement where excess or near-excess foreign currency is available and such a limitation on payments in dollars is considered to be practicable. § 1-6.806-2 Method of purchase. Contracts in furtherance of this Subpart 1-6.8 are considered to be negotiated procurements and may be entered into by conventional negotiation or by special method of negotiated procurement knows as "Balance of Payments Restricted Advertising." Within the United States, the latter method shall be used wherever possible. Balance of Payments Restricted Advertising, includ ing awards thereunder, shall be conducted in the same manner as prescribed for formal advertising in Part 1-2 of this chapter, except that bids and awards shall be restricted to U.S. end products and services. Contracts entered into pursuant to conventional negotiation shall cite exceptions (2) through (15) of 41 U.S.C. 252(c), as appropriate. Where such negotiation authority is not applicable or where contracts are entered into pursuant to the Balance of Payments Restricted Advertising method of procurement, 41 U.S.C. 252(c) (1) shall be cited as negotiation authority. Invitations for bids and requests for proposals shall clearly designate items being procured pursuant to the Balance of Payments Program. To the extent that the Government specifies that the items being purchased are in implementation of the Balance of Payments Program, the bidder or offeror hereby certifies that each such item is a U.S. end product or comprises U.S. services (as defined in the contract clause entitled "U.S. Products and Services (Balance of Payments Program)"), and that components of unknown origin have been considered to have been mined, produced, or manufactured outside the United States. § 1-6.806-4 Contract clause. The clause set forth below shall be inserted in contracts resulting from Balance of Payments Program procurements. U.S. PRODUCTS AND SERVICES (BALANCE OF PAYMENTS PROGRAM) (a) To the extent that the Government specifies that the items being purchased are in implementation of the Balance of Payments Program, the Contractor agrees that there will be delivered or performed under this contract only U.S. end products or U.S. services. (b) For the purpose of this clause: (1) "Components" means those articles, materials, and supplies which are directly incorporated in the end products; (2) "End products" means those articles, materials, and supplies which are acquired under this contract for public use; (3) "U.S. end product" means: (i) An unmanufactured end product which has been mined or produced in the United States; or (ii) An end product manufactured in the United States, if the cost of the components thereof which are mined, produced, or manufactured in the United States exceeds 5C percent of the cost of all its components. For the purpose of this subparagraph, components of foreign origin of the same type and kind which the Government determines are not mined, produced, or manufactured in sufficient and reasonably available commercial quantities and of satisfactory quality shall be treated as components mined, produced, or manufactured in the United States. (4) "U.S. services" means those that are performed within the United States. In some instances, services provided under a single contract are performed partially in the United States and partially abroad. Such services shall be considered U.S. services if 25 percent or less of the total cost of the services is attributable to services (including incidental supplies used in connection therewith) performed outside the United States. PART 1-7-CONTRACT CLAUSES Clauses in standard construction contract forms. Subpart 1-7.1-Fixed-Price Supply Contracts 1-7.601-3 Differing site conditions. Additional standardized clauses. Late bids and modifications or withdrawals. Termination for convenience of the Government, in contracts estimated to exceed $10,000. Termination for convenience of the Government, in contracts estimated not to exceed $10,000. Price reduction for defective cost or pricing data. Audit and records. Subcontractor cost and pricing Examination of records. 1-7.101-15 Convict labor. 1-7.602-8 Advance payments. 1-7.602-9 Workmen's compensation insur ance (Defense Base Act). 1-7.602-10 Federal, State, and local taxes. Appendix-Background and nature of revisions to contract clauses. AUTHORITY: The provisions of this Part 1-7 issued under sec. 205 (c), 63 Stat. 390; 40 U.S.C. 486 (c). SOURCE: The provisions of this Part 1-7 appear at 29 F.R. 10192, July 24, 1964, unless otherwise noted. § 1-7.000 Scope of part. This part sets forth contract clauses for use in connection with the procurement of personal property and nonpersonal services (including construction). As used throughout this contract, the following terms shall have the meanings set forth below: (a) The term "head of the agency" or "Secretary" as used herein means the Secretary, the Under Secretary, any Assistant Secretary, or any other head or assistant head of the executive or military department or other Federal agency; and the term "his duly authorized representative" means any person or persons or board (other than the Contracting Officer) authorized to act for the head of the agency or the Secretary. (b) The term "Contracting Officer" means the person executing this contract on behalf of the Government, and any other officer 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. 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; (ii) 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 Con tractor for adjustment under this clause must be asserted within 30 days from the date of receipt by the Contractor of the notification of 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. § 1-7.101-3 Extras. EXTRAS Except as otherwise provided in this contract, no payment for extras shall be made unless such extras and the price therefor have been authorized in writing by the Contracting Officer. § 1-7.101-4 Variation in quantity. VARIATION IN QUANTITY No variation in the quantity of any item called for by this contract will be accepted unless such variation has been caused by conditions of loading, shipping, or packing, or allowances in manufacturing processes. and then only to the extent, if any specified elsewhere in this contract. § 1-7.101-5 Inspection. INSPECTION (a) All supplies (which term throughout this clause includes without limitation raw materials, components, intermediate assemblies, and end products) shall be subject to inspection and test by the Government, to the extent practicable at all times and places including the period of manufacture, and in any event prior to acceptance. (b) In case any supplies or lots of supplies are defective in material or workmanship or otherwise not in conformity with the requirements of this contract, the Government shall have the right either to reject them (with or without instructions as to their disposition) or to require their correction. Supplies or lots of supplies which have been rejected or required to be corrected shall be removed, or, if permitted or required by the Contracting Officer, corrected in place by and at the expense of the Contractor promptly after notice, and shall not thereafter be tendered for acceptance unless the former rejection or requirement of correction is disclosed. If the Contractor fails promptly to remove such supplies or lots of supplies which are required to be removed, or promptly to replace or correct 185 such supplies or lots of supplies, the Government either (i) may by contract or otherwise replace or correct such supplies and charge to the Contractor the cost occasioned the Government thereby, or (ii) may terminate this contract for default also provided in the clause of this contract entitled "Default." Unless the Contractor corrects or replaces such supplies within the delivery schedule, the Contracting Officer may require the delivery of such supplies at a reduction in price which is equitable under the circumstances. Failure to agree to such reduction of price shall be a dispute concerning a question of fact within the meaning of the clause of this contract entitled "Disputes." (c) If any inspection or test is made by the Government on the premises of the Contractor or a subcontractor, the Contractor without additional charge shall provide all reasonable facilities and assistance for the safety and convenience of the Government inspectors in the performance of their duties. If Government inspection or test is made at a point other than the premises of the Contractor or a subcontractor, it shall be at the expense of the Government except as otherwise provided in this contract: Provided, That in case of rejection the Government shall not be liable for any reduction in value of samples used in connection with such inspection or test. All inspections and tests by the Government shall be performed in such a manner as not to unduly delay the work. The Government reserves the right to charge to the Contractor any additional cost of Government inspection and test when supplies are not ready at the time such inspection and test is requested by the Contractor or when reinspection or retest is necessitated by prior rejection. Acceptance or rejection of the supplies shall be made as promptly as practicable after delivery, except as otherwise provided in this contract; but failure to inspect and accept or reject supplies shall neither relieve the Contractor from responsibility for such supplies as are not in accordance with the contract requirements nor impose liability on the Government therefor. (d) The inspection and test by the Government of any supplies or lots thereof does not relieve the Contractor from any responsibility regarding defects or other failures to meet the contract requirements which may be discovered prior to acceptance. Except as otherwise provided in this contract, acceptance shall be conclusive except as regards latent defects, fraud, or such gross mistakes as amount to fraud. (e) The Contractor shall provide and maintain an inspection system acceptable to the Government covering the supplies hereunder. Records of all inspection work by the Contractor shall be kept complete and available to the Government during the performance of this contract and for such longer period as may be specified elsewhere in this contract. § 1-7.101-6 Responsibility for supplies. RESPONSIBILITY FOR SUPPLIES Except as otherwise provided in this contract, (i) the Contractor shall be responsible for the supplies covered by this contract until they are delivered at the designated delivery point, regardless of the point of inspection; (ii) after delivery to the Government at the designated point and prior to acceptance by the Government or rejection and giving notice thereof by the Government, the Government shall be responsible for the loss or destruction of or damage to the supplies only if such loss, destruction, or damage results from the negligence of officers, agents, or employees of the Government acting within the scope of their employment; and (iii) the Contractor shall bear all risks as to rejected supplies after notice of rejection, except that the Government shall be responsible for the loss, or destruction of, or damage to the supplies only ir such loss, destruction or damage results from the gross negligence of officers, agents, or employees of the Government acting within the scope of their employment. § 1-7.101-7 Payments. PAYMENTS The Contractor shall be paid, upon the submission of proper invoices or vouchers, the prices stipulated herein for supplies delivered and accepted or services rendered and accepted, less deductions, if any, as herein provided. Unless otherwise specified, payment will be made on partial deliveries accepted by the Government when the amount due on such deliveries so warrants; or when requested by the Contractor, payment for accepted partial deliveries shall be made whenever such payment would equal or exceed either $1,000 or 50 percent of the total amount of this contract. § 1-7.101-8 Assignment of claims. Insert the clause set forth in § 1-30.703 under the conditions contained therein. § 1-7.101-9 Additional bond security. ADDITIONAL BOND SECURITY If any surety upon any bond furnished in connection with this contract becomes unacceptable to the Government, or if any such surety fails to furnish reports as to his financial condition from time to time as requested by the Government, the Contractor shall promptly furnish such additional security as may be required from time to time to protect the interests of the Government and of persons supplying labor or materials in the prosecution of the work contemplated by this contract. § 1-7.101-10 Examination of records. EXAMINATION OF RECORDS (a) The Contractor agrees that the Comptroller General of the United States or any of his duly authorized representatives shall, until the expiration of three years after final payment under this contract, have access to and the right to examine any directly pertinent books, documents, papers, and records of the Contractor involving transactions related to this contract. (b) The Contractor further agrees to include in all his subcontracts hereunder a provision to the effect that the subcontractor agrees that the Comptroller General of the United States or any of his duly authorized representatives shall, until the expiration of three years after final payment under the subcontract, have access to and the right to examine any directly pertinent books, documents, papers, and records of such subcontractor, involving transactions related to the subcontract. The term "subcontract" as (a) Except as otherwise provided in this contract, any dispute concerning a question of fact arising under this contract which is not disposed of by agreement shall be decided by the Contracting Officer, who shall reduce his 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, 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 offical, representative, or board on a question of law. § 1-7.101-13 Notice and assistance regarding patent and copyright infringement. NOTICE AND ASSISTANCE REGARDING PATENT AND COPYRIGHT INFRINGEMENT (a) The Contractor shall report to the Contracting Officer, promptly and in reasonable written detail, each notice or claim of patent or copyright infringement based on the performance of this contract of which the Contractor has knowledge. (b) In the event of any claim or suit against the Government on account of any alleged patent or copyright infringment arising out of the performance of this contract or out of the use of any supplies furnished or work or services performed hereunder, the Contractor shall furnish to the Government, when requested by the Contracting Officer, all evidence and information in possession of the Contractor pertaining to such suit or claim. Such evidence and information shall be furnished at the expense of the Government except where the Contractor has agreed to indemnify the Govern ment. The above clause shall be included only if the amount of the contract exceeds $10,000. § 1-7.101-14 Buy American Act. Insert the clause set forth in § 1-6.1045 under the conditions contained therein. § 1-7.101-15 Convict labor. Insert the clause set forth in § 1-12.203 under the conditions contained in § 1-12.202. § 1–7.101–16 Contract Work Hours Standards Act-overtime compensation. Insert the clause set forth in § 1-12.303 under the conditions contained in § 1-12.302. § 1-7.101-17 Walsh-Healey Public Contracts Act. Insert the clause set forth in § 1-12.605 under the conditions contained in § 1-12.602. § 1-7.101-18 Equal opportunity. Insert the clause set forth in § 1-12.803-2 under the conditions contained in § 1-12.803-1. |