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Subpart 10-Exemption of Certain Contracts With Foreign Contractors From the Requirement for an Examination of Records Clause

6.1000 Scope of Subpart. This Subpart sets forth policies and procedures for exempting the requirement for the "Examination of Records" clause in contracts with foreign contractors and foreign subcontractors.

6.1001 Statutory Requirements.

(a) In accordance with 10 U.S.C. 2313(c), the "Examination of Records" clause may be excluded from negotiated contracts and subcontracts with foreign contractors and foreign subcontractors where:

(i) the Administrator determines, with the concurrence of the Comptroller General or his designee, that inclusion of the clause would not be in the public interest; or

(ii) where

(A) the contractor or subcontractor is a foreign government or agency thereof or is precluded by the laws of the country involved from making its books, documents, papers, or records available for examination, and

(B) The Administrator determines, after taking into account the price and availability of the property or services from United States sources, that the public interest would be best served by exclusion of the clause.

(b) A determination of the Administrator under (ii) above does not require the concurrence of the Comptroller General or his designee. However, where a determination of the Administrator under (ii) is the basis for exclusion of the "Examination of Records" clause, the statute requires that a written report be furnished to the Congress. This report, which shall explain the reasons for the determination, shall be prepared in triplicate, signed by the head of the installation concerned, and forwarded to the Director of Procurement (Code KDP-2 for processing to the Administrator.

6.1002 Policy. The "Examination of Records" clause shall be included wherever possible. Exclusion of the clause should be allowed only after the contracting officer has made all reasonable efforts to include the clause and has considered such factors as alternate sources of supply, additional cost, and time of delivery. "Foreign Contractor" for purposes of this Subpart is defined as "one that is organized or existing under the laws of a country other than the United States, its territories or possessions."

6.1003 Requests for Determinations and Findings. Request for determinations and findings for exclusion ordinarily will be initiated by the contracting officer. The request shall consist of a letter submitted through normal procurement channels, addressed to the Administrator setting forth all the facts necessary to arrive at an appropriate determination and findings.

FOREIGN PURCHASES

6.1004 Determination and Findings. The determination and findings made by the Administrator to authorize exclusion of the "Examination of Records" clause from a contract with a foreign contractor or foreign subcontractor under 10 U.S.C. 2313(c) shall:

(i) identify the contract and its purpose, and state, that it is a contract or subcontract with a foreign contractor or foreign subcontractor, or that the contractor or subcontractor is a foreign government or agency thereof;

(ii) describe the efforts that have been made to include the clause in the contract or subcontract;

(iii) state the reasons for the contractor's or subcontractor's refusal to include the clause;

(iv) describe the price and availability of the property or services from United States and other sources; and

(v) determine that it is in the public interest to exclude the clause pursuant to the provisions of 10 U.S.C. 2313(c).

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Subpart 1-Clauses for Fixed-Price Supply Contracts

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7.104 Clauses Required To Be Used When Applicable..

7.104-1 Clauses for Contracts Involving Construction

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Examination of Records...

7.104-16 [Reserved]--

7.104-17 Convict Labor..

7.104-18 Priorities, Allocations, and Allotments................

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Subpart 1-Clauses for Fixed-Price Supply Contracts-Continued

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7.104 Clauses Required To Be Used When Applicable-Continued 7.104-14 Utilization of Small Business Concerns... 7.104-15

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7.104-59 Non-Use of Foreign-Flag Vessels Engaged in

Cuban and North Vietnam Trade_

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7.104-60 Report on NASA Subcontracts....

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7.104-61 Rights in Data for Potentially Hazardous Items..
7.104-62 Potentially Hazardous Items....

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7.106-1

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Subpart 1-Clauses for Fixed-Price Supply Contracts-Continued Paragraph

7.106 Price Escalation Clauses (Established Prices).

Escalation Clause for Basic Steel, Aluminum,

Brass, Bronze, or Copper Mill Products----
Escalation Clause for Nonstandard Steel Items..
Escalation Clause for Standard Supplies__
Escalation Clause for Semistandard Supplies...

7.107 Price Escalation Clause (Labor and Material)

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7.201 [Reserved]-

7.202 Applicability..

Subpart 2-Clauses for Cost-Reimbursement Type Supply Contracts

7.200 Scope of Subpart....

7.203 Required Clauses..

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7.203-5

Inspection of Supplies and Correction of Defects. 728. 3

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