[Federal Register: March 27, 2007 (Volume 72, Number 58)]
[Rules and Regulations]               
[Page 14240-14241]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr27mr07-5]                         

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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 232 and 252

RIN 0750-AF28

 
Defense Federal Acquisition Regulation Supplement; Electronic 
Submission and Processing of Payment Requests (DFARS Case 2005-D009)

AGENCY: Defense Acquisition Regulations System, Department of Defense 
(DoD).

ACTION: Final rule.

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SUMMARY: DoD has issued a final rule amending the Defense Federal 
Acquisition Regulation Supplement (DFARS) to update policy addressing 
requirements for DoD contractors to submit payment requests in 
electronic form. The rule clarifies the situations under which DoD will 
grant exceptions to requirements for electronic submission of payment 
requests.

EFFECTIVE DATE: March 27, 2007.

FOR FURTHER INFORMATION CONTACT: Mr. John McPherson, Defense 
Acquisition Regulations System, OUSD(AT&L)DPAP(DARS), IMD 3C132, 3062 
Defense Pentagon, Washington, DC 20301-3062. Telephone (703) 602-0296; 
facsimile (703) 602-0350. Please cite DFARS Case 2005-D009.

SUPPLEMENTARY INFORMATION:

A. Background

    This final rule amends DFARS Subpart 232.70 and the corresponding 
contract clause at 252.232-7003 to clarify the situations under which 
DoD will grant exceptions to requirements for electronic submission of 
payment requests.
    DoD published a proposed rule at 71 FR 14149 on March 21, 2006. Two 
sources submitted comments on the proposed rule. A discussion of the 
comments is provided below.
    1. Comment: One respondent recommended expansion of the DFARS text 
that permits the administrative contracting officer to authorize 
submission of a non-electronic payment request, to also provide this 
authority to the procuring contracting officer. The respondent stated 
that the expansion is necessary to identify authorized officials for 
contracts that are not administered by the Defense Contract Management 
Agency.
    DoD Response: DoD agrees that this authority belongs to the 
contracting officer administering the contract. However, there may be 
several contracting officers providing administrative support for a 
contract. Therefore, DoD has revised the rule to make this approval the 
responsibility of the contracting officer administering the contract 
for payment.
    2. Comment: One respondent stated there should be a distinction 
between the requirement for contractors to submit payment requests in 
electronic form and the requirement for DoD procurement officials to 
process supporting documents in electronic form.
    DoD Response: It is DoD policy for all required documentation to be 
submitted and processed in electronic form to facilitate the payment 
process. DoD believes the DFARS rule implements this policy and has 
made no related changes regarding this requirement in the final rule.
    3. Comment: One respondent recommended limiting the alternative 
payment request methods to conventional mail or facsimile. The 
respondent pointed out that each new alternative method of submission 
requires the establishment of business rules to properly monitor 
payment requests and to ensure timely payment. In addition, submission 
by methods such as e-mail will require the printing and scanning of 
documents and will increase the workload of the payment office.
    DoD Response: The final rule includes changes that limit the 
alternative payment request methods to conventional mail or facsimile. 
DoD recognizes that the Defense Finance and Accounting Service (DFAS) 
has established procedures with adequate controls for the paper and 
facsimile submission process to ensure prevention of duplicate payments 
and to provide an adequate audit trail. E-mail submission is not viable 
at this time, because DFAS presently does not have procedures in place 
to process such submissions and to maintain sufficient process control.
    This rule was not subject to Office of Management and Budget review 
under Executive Order 12866, dated September 30, 1993.

B. Regulatory Flexibility Act

    DoD certifies that this final rule will not have a significant 
economic impact on a substantial number of small entities within the 
meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., 
because the rule is designed to avoid any such impact by permitting 
alternative means of requesting payment when submission of electronic 
payment

[[Page 14241]]

requests would be unduly burdensome to a contractor.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply, because the rule does 
not impose any information collection requirements that require the 
approval of the Office of Management and Budget under 44 U.S.C. 3501, 
et seq.

List of Subjects in 48 CFR Parts 232 and 252

    Government procurement.

Michele P. Peterson,
Editor, Defense Acquisition Regulations System.

0
Therefore, 48 CFR parts 232 and 252 are amended as follows:
0
1. The authority citation for 48 CFR parts 232 and 252 continues to 
read as follows:

    Authority: 41 U.S.C. 421 and 48 CFR Chapter 1.

PART 232--CONTRACT FINANCING

0
2. Section 232.7002 is revised to read as follows:


232.7002  Policy.

    (a) Contractors shall submit payment requests in electronic form, 
except for--
    (1) Purchases paid for with a Governmentwide commercial purchase 
card;
    (2) Awards made to foreign vendors for work performed outside the 
United States;
    (3) Classified contracts or purchases when electronic submission 
and processing of payment requests could compromise the safeguarding of 
classified information or national security;
    (4) Contracts awarded by deployed contracting officers in the 
course of military operations, including, but not limited to, 
contingency operations as defined in 10 U.S.C. 101(a)(13) or 
humanitarian or peacekeeping operations as defined in 10 U.S.C. 
2302(8), or contracts awarded by contracting officers in the conduct of 
emergency operations, such as responses to natural disasters or 
national or civil emergencies;
    (5) Purchases to support unusual or compelling needs of the type 
described in FAR 6.302-2;
    (6) Cases in which DoD is unable to receive payment requests in 
electronic form; or
    (7) Cases in which the contracting officer administering the 
contract for payment has determined, in writing, that electronic 
submission would be unduly burdensome to the contractor.
    (b) DoD officials receiving payment requests in electronic form 
shall process the payment requests in electronic form. Any supporting 
documentation necessary for payment, such as receiving reports, 
contracts, contract modifications, and required certifications, also 
shall be processed in electronic form. Scanned documents are acceptable 
forms for processing supporting documentation.
    (c) When payment requests will not be submitted in electronic 
form--
    (1) Payment requests shall be submitted by facsimile or 
conventional mail. The contracting officer shall consult with the 
payment office and the contract administration office regarding the 
method of payment request to be used; and
    (2) Section G of the contract shall specify the method of payment 
request.


232.7003  [Amended]

0
3. Section 232.7003 is amended in paragraph (a)(3) by removing ``http://www.dod.mil/dfas/'' and adding in its place ``http://www.dod.mil/dfas/

contractorpay/electroniccommerce.html''.

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
4. Section 252.232-7003 is amended as follows:
0
a. By revising the clause date and paragraphs (b)(3)(ii) and (c);
0
b. By redesignating paragraph (d) as paragraph (e); and
0
c. By adding a new paragraph (d) to read as follows:


252.232-7003  Electronic Submission of Payment Requests.

* * * * *

ELECTRONIC SUBMISSION OF PAYMENT REQUESTS (MAR 2007)

* * * * *
    (b) * * *
    (3) * * *
    (ii) EDI implementation guides are available on the Internet at 
http://www.dod.mil/dfas/contractorpay/electroniccommerce.html.

* * * * *
    (c) The Contractor may submit a payment request in non-
electronic form only when--
    (1) DoD is unable to receive a payment request in electronic 
form; or
    (2) The Contracting Officer administering the contract for 
payment has determined, in writing, that electronic submission would 
be unduly burdensome to the Contractor. In such cases, the 
Contractor shall include a copy of the Contracting Officer's 
determination with each request for payment.
    (d) The Contractor shall submit any non-electronic payment 
requests using the method or methods specified in Section G of the 
contract.
* * * * *
[FR Doc. E7-5478 Filed 3-26-07; 8:45 am]

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