Subpart 14-Transportation by Ocean Carriers 1.1400 Scope. This Subpart sets forth policy and procedures (i) providing preference for private United States Flag vessels in accordance with the requirements of the Cargo Preference Act (46 U.S.C. 1241(b)), and (ii) providing for non-use of foreign-flag vessels that have engaged in trade with Cuba or North Vietnam. 1.1401 [Reserved] 1.1402 Preference for Private United States Vessels. 1.1402-1 Policy. (a) The Cargo Preference Act (46 U.S.C. 1241(b)) establishes a policy of preference for private United States vessels as follows: "Whenever the United States shall procure, contract for, or otherwise obtain for its own account, or shall furnish to or for the account of any foreign nation without provision for reimbursement, any equipment, materials, or commodities, within or without the United States, or shall advance funds or credit or guarantee the convertibility of foreign currencies in connection with the furnishing of such equipment, materials, or commodities, the appropriate agency or agencies shall take such steps as may be necessary and practicable to assure that at least 50 per centum of the gross tonnage of such equipment, materials, or commodities (computed separately for dry bulk carriers, dry cargo liners, and tankers), which may be transported on ocean vessels shall be transported on privately owned United States-Flag commercial vessels, to the extent such vessels are available at fair and reasonable rates for United States-flag commercial vessels, in such manner as will insure a fair and reasonable participation of United States-flag commercial vessels in such cargoes by geographic areas.....” (b) In complying with the above policy, shipments of at least 50 percent of all ocean tonnage during each calendar year will be made on private United States vessels without deduction of any tonnage which may be made the subject of a waiver or exclusion by reason of the unavailability of private United States vessels at fair and reasonable rates and which tonnage might otherwise be treated as a deduction from aggregate tonnage. (c) The provisions of this Subpart 14 are intended to encourage the use of the American merchant marine and application of the 50 percent requirement shall not prevent the use of private United States vessels for carriage of up to 100 percent of United States Government cargo when price differentials are not involved. (d) This policy shall apply not only to supplies owned by the Government, which may be in the possession of either the Government or a contractor or subcontractor (of any tier), but also to supplies not owned by the Government at the time of shipment but which are for use of the Government, contracted for, and requiring subsequent delivery to NASA. 1.1402-2 Shipments to Which Policy is Not Applicable. By reason of statutory exemptions or requirements, the policies set forth in this Subpart 14 do not cover the following types of ocean shipments: (a) Shipments aboard vessels of the Panama Canal Company (Cargo Preference Act). · (b) Shipments of supplies involving ocean transportation between foreign countries when supplies are procured with local currency funds made available, or derived from funds made available, in the Act of September 4, 1961, P.L. 87-195; 75 Stat. 424. (c) Shipments of classified supplies when the classification prohibits the use of non-Government vessels. NASA PROCUREMENT REGULATION 1.1402-2 50-137 0-81 18 TRANSPORTATION BY OCEAN CARRIERS 1.1402-3 Procedures. (a) In each procurement which may involve the ocean transportation of supplies subject to the requirements of the Cargo Preference Act, the contracting officer shall obtain assistance from the transportation officer of the field installation in developing appropriate shipping instructions and delivery terms for inclusion in the invitations for bids or requests for proposals. (b) Contract Clause. All contracts which may involve the ocean transportation of supplies subject to the requirements of the Cargo Preference Act shall contain the following clause except where the ocean transportation will be procured by the Government: PREFERENCE FOR UNITED STATES-FLAG VESSELS if (a) After the date of award of this contract, the Contractor shall employ privately owned United States-flag commercial vessels, and no others, in the transportation by sea of any supplies to be furnished hereunder; provided, however, that such vessels are not available for timely shipment at fair and reasonable rates for such vessels, the Contractor shall SO notify the Contracting Officer and request authorization to ship in foreign-flag vessels or designation of available United States-flag vessels. If the Contractor is authorized in writing by the Contracting Officer to ship such supplies in foreign-flag vessels, the contract price shall be equitably adjusted to reflect the difference in costs of shipping such supplies privately owned United States-flag commercial vessels and foreign-flag vessels. on (b) Promptly after each shipment the Contractor shall furnish the Contracting Officer one copy of the applicable shipping document indicating for each shipment made under this contract the name and nationality of the vessel and the measurement tonnage (40 cubic feet) of dry cargo, or long tons (2,240 pounds) of bulk liquid cargo shipped on such vessels. One copy of the applicable shipping document shall also be sent to the U.S. Maritime Administration, Division of National Cargo, 14th and E Streets, N.W., Washington, D.C. 20230. (c) The Contractor shall include the substance of this clause, including this paragraph (c) in each subcontract or purchase order hereunder which may involve ocean transportation. (End of clause) (c) In the event of notification by the contractor in accordance with the clause set forth in (b) above that a private United States vessel is not available, the contracting officer will seek assistance from the transportation officer of the field installation. CFR TITLE 41 CHAPTER 18 TRANSPORTATION BY OCEAN CARRIERS (d) For purposes of determining the availability of private United States vessels at fair and reasonable rates, rates filed and published in accordance with the requirements of the Federal Maritime Commission shall be accepted as fair and reasonable. When applicable rates are not named in published tariffs, a determination as to whether the rates are fair and reasonable shall be obtained from the United States Maritime Administration. (e) If shipment by foreign-flag commercial vessel is authorized by the contracting officer in accordance with the clause set forth in paragraph (b) above, the contracting officer shall ensure that, where appropriate, the contract price is equitably adjusted. (f) A register will be established and maintained by the transportation officer in each field installation to reflect adherence to the Cargo Preference Act. Where there is no transportation officer available, it will be maintained by the procurement office. Such registers shall contain pertinent details of ocean shipments, including, but not limited to. the ports of origin and destination of shipments, commodity descriptions, and gross weight, freight revenue, name of vessel, operator of vessel, and date of loading. Registers shall be maintained on a current basis and organized so that adherence to the Cargo Preference Act can be ascertained at all times. Insofar as practicable, compliance with the 50 percent minimum requirements of the Cargo Preference Act shall be maintained on a quarter-year basis. Any deficiencies to maintain such compliance shall be corrected by the end of the calendar year. (g) On the basis of the registers maintained in accordance with (f) above, quarterly reports reflecting actual ocean shipments (except any shipments via the Military Sealift Command) shall be submitted to the Office of Market Development, Maritime Administration, Department of Commerce, Washington, D.C., 20235. Negative reports are required when applicable. reports will be made by the transportation officers and contracting officers responsible for maintaining the registers described in paragraph (f) above. Such NASA PROCUREMENT REGULATION Subpart 15-Options 1.1500 Scope of Subpart. This Subpart applies to contracts for supplies and services other than for (1) the construction, alteration, or repair of buildings, bridges, roads, or other kinds of real property and (ii) research and development. It does not preclude the inclusion of appropriate options in such construction and research and development contracts. 1.1501 Definition. As used in this Subpart, an option is a unilateral right in a contract by which, for a specified time, the Government may elect to purchase additional quantities of the supplies or services called for by the contract, or may elect to extend the period of performance of the contract. 1.1502 Applicability. (a) Option clauses may be included in contracts if increased requirements within the period of contract performance are foreseeable, or if continuing performance beyond the original period of contract performance may be in the best interest of the Government. Because options require offerors to guarantee prices for definite periods of time with no assurance that the options will be exercised, their improper inclusion could result in prices which are unfair to either the Government or the contractor. Therefore, an option clause normally should not be included if it can reasonably be foreseen that (4) minimum economic production quantities will be required at some future date, and (11) startup costs, production lead time, and probable delivery requirements would not preclude adequate future competition. (b) Option clauses shall not be included in contracts, and option provisions shall not be included in solicitations, if: (1) the supplies or services being purchased are readily available on the open market; (11) the contractor would be required to incur undue risks: (e.g., the price or availability of necessary materials or labor is not reasonably foreseeable); (111) an indefinite quantity contract or requirements contract is appropriate except that options for continuing performance may be used in such contracts; (iv) market prices for the supplies or services involved are likely to change substantially; or (v) the option quantities represent known firm requirements for which funds are available unless (A) the basic quantity is a learning or testing quantity and there is some uncertainty as to contractor or equipment performance, and (B) realistic competition for the option quantity is impracticable once the initial contract is awarded. (c) In recognition of (1) the Government's need in certain service contracts for continuity of operation and (11) the potential cost of disrupted support, options may be included in service contracts if there is an anticipated need for a similar service beyond the first contract period. (d) Solicitations normally should allow option quantities to be offered without limitation as to price, and there shall be NASA PROCUREMENT REGULATION GENERAL PROVISIONS no limitation as to price if the option quantity is to be considered in the evaluation for award pursuant to 1.1504. In unusual circumstances, solicitations may require that option quantities be offered at prices no higher than those for the initial quantities. Such circumstances may exist, for example, when (1) the option cannot be evaluated pursuant to 1.1504(c) or (d) because additional requirements are foreseeable but not known, and (ii) realistic competition for the option quantity is impracticable once the initial contract is awarded. However, because such limitations as to option prices tend to cause a "frontloading" of costs on the basic quantity which are transferred from the option quantity to equalize the prices offered, their improper inclusion could result in prices which are unfair to the Government should the options not be exercised. Therefore, the procedures in 1.1503(d) shall be followed. (e) The total of the basic and option periods shall not exceed five years in the case of services, and the total of the basic and option quantities shall not exceed the requirement for five years in the case of supplies. This five year limitation shall not apply to Automatic Data Processing Equipment acquisitions; however, the basic and option periods shall not exceed the approved systems life as defined in 3.1150-2(j). 1.1503 Procedures. (a) If a contract to contain an option clause, the solicitation must contain an appropriate option provision. The contract shall limit the additional quantities of supplies or services which may be procured, or the duration of the period for which performance of the contract may be extended under the option and will fix the period within which the option may be exercised. This period shall be set so as to afford the contractor adequate notice of the requirement for performance under the option but with respect to service contracts may extend beyond the contract completion date when exercise of the option would obligate funds not available in the fiscal year in which the contract would otherwise be completed. In fixing the period within which the option may be exercised, consideration shall be Next page is 1-15:37 CFR TITLE 41 CHAPTER 18 |