the number of expected awards will provide the measure for determining probable 20,000-lb. shipments under each expected award. When solicitations include more than one destination, an award may have more than one place of delivery. Generally, when f.o.b. origin bids are solicited, the contract will require that, consistent with quantities schedule for periodic deliveries, f.o.b. origin shipments will be made in carload or truckload lots.

§ 1201.1302-2 Shipments from the United States for oversea delivery.

(a) When items to be procured are for known destinations outside the United States, ocean and port handling costs will be included in the invitation for bids or requests for proposals, and the specific ports or points of exit that are to be used as a basis for the evaluation of the transportation cost to destinations will be named. Ports or points of exit will be determined by appropriate coordination between the contracting officer and the transportation office serving the DSA activity.

(b) When valid reasons exist for procurement f.o.b. destination (port), and the contract will produce no shipment which will require an export traffic release in accordance with Defense Traffic Management Regulations, only one port or point of exit (generally, the primary port which serves the oversea requisitioner) will be named in the solicitation.

(c) When it is determined that only one port or point of exit will be named in the solicitation, ocean and port handling costs will be omitted unless shipping weights (and dimensions if applicable) of an item are a factor in determining comparative transportation costs for bid evaluation. (See § 2.201(b) (13) of this title.)

(d) Information pertaining to CONUS, ocean, and port handling transportation costs will be secured from the transportation office serving the DSA activity. § 1201.1302-3 Shipments originating

outside the United States.

It is the policy of the Department of Defense, in furtherance of the Cargo Preference Act, to encourage and foster the American merchant marine. (See § 1.1401 of this title.) In the absence of specific instructions, when transportation of supplies by ocean vessel will be required, the most appropriate place of delivery for shipments originating outside the United States will be determined

based on known availability of American flag shipping between points involved. In accordance with prescribed procedures of the Defense Traffic Management Service, the transportation office serving the DSA activity will furnish such information and guidance to the contracting officer.

§ 1201.1303 Quantity analysis. § 1201.1303-1 Procurement of small quantities by negotiation.

Additional quantities of the item often may be transported at no increase in transportation costs or purchase of carload or truckload quantities may result in lower unit costs. The contracting officer should determine whether, normally, additional quantities will be required for requisitioning activities during a subsequent period. If additional quantities can be accommodated, officers should be requested to submit prices on original quantities as well as quantities equivalent to the minimum carload or truckload weights which will apply between offerers' shipping points and destination.

(a) Solicitations shall require prospective suppliers to furnish such of the following as may be appropriate:

(1) Method of proposed shipment, such as rail, water, air, highway, common carrier, contract carrier, private or leased truck.

(2) Freight classification description, such as indicated in the Consolidated or Uniform Freight Classification (rail), or the National Motor Freight Classification. The description should be applicable to the item when shipped for commercial use on commercial prepaid bills of lading. When optional, the description will include the packaging of the commodity (box, crate, loose, compressed, etc.); the container material (fiberboard, wood, etc.); unusual shipping dimensions; and other features affecting traffic descriptions.

(b) Except for valid reasons to the contrary, solicitation for supplies to be purchased on the basis of f.o.b. origin as designated in § 1201.1305-4 shall include a clause substantially as follows:

F.O.B. ORIGIN-CARLOAD AND TRUCKLOAD SHIPMENTS (JULY 1962)

The Government requires, and the Contractor agrees, that shipment will be made in

carload or truckload lots when the quantity to be delivered to any one destination in any delivery period pursuant to the contract schedule of deliveries is sufficient to constitute a carload or truckload shipment, except as may otherwise be permitted or directed in writing by the Contracting Officer for the benefit of the Government. For bid evaluation purposes, the agreed weight of a carload or truckload will be the highest applicable minimum weight which will result in the lowest freight rate on file or published as of the date of bid opening under formally advertised procurement (the closing date specified for receipt of proposals under negotiated procurement). For purposes of subsequent delivery, the agreed weight of a carload or truckload will be the highest applicable minimum weight which will result in the lowest freight rate on file or published as of date of shipment. In the event the total weight of any scheduled monthly quantity to a destination is less than the highest carload/truckload minimum weight used for bid evaluation, the Contractor agrees to ship such total quantity in one shipment. The Contractor shall be liable to the Government for any increased costs to the Government resulting from failure to comply with the preceding requirements.

(c) When only f.o.b origin bids are solicited for appropriate quantities and firm destinations, and inspection and acceptance conditions are compatible, bidders should be permitted to offer their transit credits (see § 1201.1308) which can be available and transferable to the Government during the scheduled delivery period. A transit credit represents the transportation cost for a recorded tonnage from an initial shipping point to an intermediate destination (bidder's plant or shipping point). Upon reshipment to ultimate Government destination, the remaining freight cost between initial and ultimate points may be lower than the cost of treating the tonnage as a new shipment. Actual lower costs to be realized by the Government through utilization of such transit credits will be used in bid evaluation. Notwithstanding Government acceptance of supplies at origin, such shipments may be required to be made on prepaid commercial bills of lading, unless the contract administering office directs use of Government bills of lading upon definite knowledge that such use is in the interest of the Government. Normally, the contractor will prepay the transportation charges, subject to reimbursement by the Government. Such shipments will move for the account of and at the risk of the Government, and

will become Government property when loaded on carrier's equipment and accepted by the carrier. The contractor will agree to show the transportation and transit charges as a separate amount on the invoice for each individual transited shipment. The amount reimbursed by the Government will not exceed the amount quoted in the bid and used for evaluation. The invoice will be supported by the carrier's receipt indicating that freight charges have been paid by the contractor.

§ 1201.1305-3 F.o.b. destination.

Whenever the supplies will be delivered f.o.b. specified destinations, a clause substantially as follows shall appear in the solicitation:

F.O.B. DESTINATION (JULY 1962)

Supplies shall be delivered to the consignee installation at the expense of the Contractor. The Government will not be liable for any transportation, delivery, storage, demurrage, accessorial, or other charges involved prior to actual delivery of the supplies to the destination.

§ 1201.1305-4 F.o.b. origin.

(a) Generally, whenever the supplies will be delivered f.o.b. origin with transportation charges borne by the Government, a clause substantially as follows shall appear in the solicitation:

F.O.B. ORIGIN (JULY 1962)

The Contractor is responsible for loading the supplies on the carrier's vehicle, wharf, or freight station specified by the Government: Provided, The Contractor will not be required to bear any costs which would exceed his costs of loading the supplies in railroad cars in the same or nearest city having rail service. Contractor will nevertheless be required to make the specified delivery and obtain the carrier's receipt and any additional costs will be adjusted pursuant to the "Changes" clause. Where Contractor's shipping plant is located in the same city (or county) listed as a destination in the invitation for bids/request for proposals or contract, Contractor shall deliver the supplies to that destination at his expense and such portion of the contract will be f.o.b. destination.

(b) Whenever the supplies are to be purchased f.o.b. origin in accordance with § 1201.1302-2 for ultimate delivery to known destinations outside the United States, a clause substantially as follows shall appear in the solicitation:

F.O.B. ORIGIN-EVALUATION EXPORT BIDS/ OFFERS (JULY 1962)

Bids will be evaluated and awards made on the basis of the lowest laid-down cost to

the Government at the overseas port of discharge, via methods and ports compatible with required delivery dates and other military considerations. Included in this evaluation, in addition to the f.o.b. origin price of the item, will be the inland transportation costs from the point of origin in the United States to the port of loading, and port handling charges in effect at the port terminal, and the ocean shipping costs from the United States port of loading to the oversea port of discharge. The Government reserves the option to designate the mode and routing of shipment and to load from other than the ports specified for evaluation purposes.

§ 1201.1308 Transit arrangements.

When it is considered that a transit privilege will be applicable and advantageous to the Government, it will be incorporated as a condition in the solicitation and become a transportation cost factor in the evaluation of bids. Both the first (intermediate) and ultimate Government destinations should be reasonably firm and named in the solicitation. Also, the quantity to be awarded must be of sufficient tonnage to ensure that carload/truckload shipments can be made by the contractor and there should be reasonable certainty that subsequent shipments out of the transit point will be requisitioned by the ultimate (or tentative) consignee in carload/truckload quantities (transit privileges for truck movement are rare). Traffic management personnel can furnish necessary information and analysis of situations where transit arrangements may be beneficial. When transit will be incorporated in contracts, the solicitation shall contain a clause substantially as follows:

STORAGE IN TRANSIT (1 JULY 1962)

For the purpose of evaluating bids, and for no other purpose, the lowest appropriate common carrier transportation costs, including through transit rates and charges where applicable, from bidders' shipping points via the transit point, to the ultimate destination, will be used to evaluate bids and make awards.

§ 1201.1312 Mode of transportation.

Normally, solicitations shall not specify a particular method or mode of transportation or a particular carrier for delivery of contract items. When special types of transportation equipment or limited facilities for delivery and receipt of material at destination permit the use of only one mode of transportation, such

special delivery requirements may, after referral to appropriate regional office, Defense Traffic Management Service, be (a) the basis for establishing the requirement for controlling the method or mode of transportation by specifying f.o.b. origin or (b) included in f.o.b. destination purchase documents.

§ 1201.1313 Transportation rates and related costs.

§ 1201.1313-1 Evaluation—f.o.b. origin.

Generally, with the exception of bulk commodities adapted to transportation by pipeline, barge, etc., land methods of transportation by regulated common carrier are the normal means of transportation that the Government uses between points in the continental United States. Accordingly, when ordinary supplies are to be procured, the solicitation shall contain a clause substantially as follows:

BID EVALUATION-F.O.B. ORIGIN-CONUS (1

JULY 1962)

Land methods of transportation by regulated common carrier are the normal means of transportation that the Government can reasonably anticipate using. Accordingly, for the purpose of evaluating bids or quotations, only such methods will be considered in establishing the cost of transportation between bidder's shipping point and destination in the continental United States (tentative or firm, whichever is applicable), which cost will be added to the bid price in determining the over-all cost of the supplies to the Government. If tentative destinations are indicated, they are being used only for bid evaluation purposes. However, the Government reserves the right to utilize any other means of transportation at the time of shipment.

§ 1201.1313-2 Sources of transportation rates and related costs.

(a) Traffic management advice and assistance, and all transportation cost factors will be secured from the transportation office serving the DSA activity.

(b) Land rates; air, inland, coastwise and intercoastal water rates; ocean rates and costs; port handling charges; and related information pertaining to supplies moving to or from oversea points, or points within the continental United States will be furnished to the transportation office by the appropriate Regional Commander of the Defense Traffic Management Service in accordance with prescribed procedures.

Subpart N-Preference for United
States Flag Privately Owned Ocean
Carriers

§ 1201.1405 Responsibilities.
§ 1201.1405-1 Military departments.

Procuring activities shall furnish quarterly reports of the gross tonnage of supplies transported by ocean carriers, other than MSTS, in accordance with the requirements of § 1.1405-1 of this title and instructions provided in this section. Shipments shall be reported for the quarter in which they originate. Reports shall be submitted by each purchasing activity to the procuring activity exercising technical control, and each procuring activity shall submit a single consolidated report covering the activi

Reporting Activity

ties over which it has cognizance. A consolidated report covering the procuring activities shall be submitted in duplicate to the Executive Director, Procurement and Production in time to arrive no later than forty-five days after the end of each calendar quarter. Until a Department of Defense report form is provided, the report shall be submitted in accordance with the sample format shown below. Negative Reports are not required. Part I of the report will be a tabulation of non-MAP shipments and Part II, a tabulation of MAP shipments. Shipments on each type of carrier (i.e., dry bulk, dry cargo liners, and tankers) shall be shown on separate pages. Individual entries on each sheet of the report shall be arranged in numerical order of originating area of shipments.

Foreign vessels (U.S. flag vessels not avail

Grand total, cols. 9+10+11

able)

AUTHORITY: The provisions of this Part 1202 issued under R.S. 161, secs. 2202, 2301, 2314, 70A Stat. 120, 127, sec. 2(a), 72 Stat. 514, sec. 1, 76 Stat. 528; 5 U.S.C. 22, 171a(c), 10 U.S.C. 2202, 2301-2314; DoD Directive 5105.22, November 6, 1961.

SOURCE: The provisions of the Part 1202 appear at 28 F.R. 2633, Mar. 19, 1963, unless otherwise noted.

Subpart A-Use of Formal Advertising § 1202.102

Policy.

§ 1202.102-2 Classified procurements.

Procurements of supplies or services classified as CONFIDENTIAL, or higher, shall not be made by formal advertising, except when the Head of a Procuring Activity considers this method to be in the interest of the Government.

Subpart B-Solicitation of Bids

§ 1202.201 Preparation of invitation for bids.

(a) Invitation for bids number. Each invitation for bids shall be assigned and shall contain in the upper right corner (unless otherwise provided for on standard forms).

(1) The letter symbol DSA followed by a dash;

(2) The number assigned to the procuring activity, a dash (See § 1201.357 of this subchapter);

(3) The last two numerals of the fiscal year in which the invitation is issued, regardless of the fiscal year funds to be expended, a dash; and

(4) The serial number of the invitation.

Only one series will be used for any procuring activity for each fiscal year, and

the first invitation issued in each fiscal year will bear 1 as its serial number. Subsequent serial numbers will be assigned consecutively, in their order of issue. A serial number once assigned to an invitation which has been distributed will not be used in the same fiscal year for any other invitation. For example, the first invitation for bids issued by the Defense Medical Supply Center in the fiscal year 1963 is number DSA-2-63-1. Other numbers or letters may be prefixed to this number if such action is desired by the head of a procuring activity.

(b) Availability, identification, and review of specifications. Each invitation for bids shall list for each item included, the applicable specifications or description as provided in Subpart L of Part 1 of this title, and Subpart L of Part 1201 of this subchapter. Such reference to specifications shall include the title and symbols, with any revision letters, and dates. Prior to issuance of invitations for bids the proposed specifications shall be reviewed in accordance with procedures prescribed by heads of procuring activities (1) to insure compliance with the provisions of Subpart L of Part 1 of this title, and Subpart L of Part 1201 of this subchapter and (2) to avoid procurement actions which would be prejudicial to the Government and to potential bidders by correcting unduly restrictive specifications and preventing so far as practicable, the necessity for amendment of invitations after issuance, and the cancellation of invitations after opening.

(c) Identification of items by broad category. The item or category of items being procured will be shown in proper, simple nomenclature in large bold type on the face and at the bottom of each invitation for bids issued.

§ 1202.202 Miscellaneous rules for soliciting bids.

§ 1202.202-2 Telegraphic bids.

When telegraphic bids are authorized, a provision substantially as follows shall be included in the invitation for bids:

TELEGRAPHIC BIDS (JULY 1962)

Telegraphic bids may be submitted in response to this Invitation for Bids. Telegraphic bids must be received in this office prior to the time specified for the opening of bids. Such bids must specifically refer to this Invitation for Bid; must include the item or sub-items, quantities and unit prices for which the bid is submitted and the time and place of delivery; and must con