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Federal Acquisition Regulation (FAR) Council:
- Final Rule: FAR, Trade Agreements Thresholds: On February 23, the Department of Defense, General Services Administration, and National Aeronautics and Space Administration published a Final Rule amending the FAR to incorporate revised thresholds for application of the World Trade Organization Government Procurement Agreement and the Free Trade Agreements, as determined by the United States Trade Representative. The Interim Rule is available here and is effective as of February 23, 2024.
- Interim Rule: FAR, Certification of Service-Disabled Veteran-Owned Small Businesses: On February 23, the Department of Defense, General Services Administration, and National Aeronautics and Space Administration published an Interim Rule amending the FAR to implement the final rules published by the Small Business Administration to implement sections of the National Defense Authorization Acts for Fiscal Years 2021 and 2022. The Interim Rule is available here and is effective as of February 23, 2024.
- Notice: Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data: On February 26, the Department of Defense, General Services Administration, and National Aeronautics and Space Administration published a Notice and request for comments about the Truth in Negotiations Act, 10 U.S.C. chapter 271 and 41 U.S.C. chapter 35, which requires the Government to obtain certified cost or pricing data from contractors prior to the award of certain contract actions. Contractors may be exempt from this requirement under certain conditions. The unpublished Notice is available here. Comments will close 30 days after publication in the Federal Register (approximately March 27, 2024).
Department of Defense (DOD):
- Notice: Defense Federal Acquisition Regulation Supplement (DFARS), Types of Contracts: On February 23, DOD published a Notice and request for comments about the requirement for contractors with fixed-price economic price adjustment contracts to submit information to the contracting officer regarding changes in established material prices or wage rates. The contracting officer uses this information to make appropriate adjustments to contract prices. The Notice is available here. Comments close March 25, 2024.
- Notice: Defense Federal Acquisition Regulation Supplement (DFARS), Taxes: On February 23, DOD published a Notice and request for comments about contractors in the United Kingdom who have attempted to obtain relief from customs duty on vehicle fuels per contract requirements. The Notice is available here. Comments close March 25, 2024.
- Notice: Negotiation of a Reciprocal Defense Procurement Agreement, Republic of Korea: On February 23, DOD published a Notice contemplating negotiating and concluding a new Reciprocal Defense Procurement Agreement with the Republic of Korea. DOD is requesting industry feedback regarding its experience in public defense procurements conducted by or on behalf of the Ministry of National Defense or Armed Forces. The Notice is available here. Comments close March 25, 2024.
- Memorandum: Defense Federal Acquisition Regulation Supplement Clause 252.245-7005, “Management and Reporting of Government Property”: On February 20, DOD published a memorandum requesting that the Defense Contract Management Agency, and other contract management organizations, evaluate use of facility-wide class modifications to incorporate DFARS clause 252.245-7005 into existing contracts under the Single Process Initiative (per DFARS subpart 242.302-S-70). Communicating the more streamlined reporting requirements to the centralized GPF Module in PIEE to contractors is critical to their understanding of their responsibilities and the current DOD system used for these processes. Read more here.
General Services Administration (GSA) Final Rule: GSA Acquisition Regulation (GSAR), Updated Guidance for Non-Federal Entities Access to Federal Supply Schedules (FSS)
On February 22, GSA published a Final Rule amending the General Services Administration Acquisition Regulation (GSAR) to update and clarify the requirements for use of Federal Supply Schedule (FSS) contracts by eligible non-federal entities, such as state and local governments. The Rule is available here and will be effective March 25, 2024.
Pentagon Wants to be ‘Approachable’ for Small Businesses, Federal News Network
Over the past decade, the number of small businesses in the defense industrial base has decreased by 40%. With the first-ever National Defense Industrial Strategy out, the Pentagon wants to turn things around. Read more here.
GSA’s New Approach to Polaris Could Help Some Joint Ventures, Washington Technology
The General Services Administration has received affirmation on how it wants to score mentor-protege joint ventures that are pursuing this government-wide IT vehicle. Read more here (subscription required).
Upcoming Government Contracts Presentations
CONFERENCE: Empowering Small Business Panel, February 29, 2024, Jon Williams. Read more here.
WEBINAR: Joint Venture and Mentor-Protege Bidding Strategies, February 29, 2024, Peter B. Ford, Meghan F. Leemon. Read more here.
CONFERENCE: Strategic Moves: Key Tactics for Seamless 8(a) M&A Transactions, Abigail “Abby” L. Baker, Isaias “Cy” Alba, IV, March 11, 2024. Read more here.
WEBINAR: Legal Strategies & Capture Planning, Isaias “Cy” Alba, IV, March 15, 2024. Read more here.
TRAINING: Legal Considerations When Supporting OCONUS Contracts, Isaias “Cy” Alba, IV, March 19, 2024. Read more here.
WEBINAR: Mergers & Acquisitions in Government Contracting: Novations and Recertification, Abigail “Abby” L. Baker, Cole R. Fox, March 20, 2024. Read more here.
WEBINAR: FAR Part 17: Special Contracting Methods, Isaias “Cy” Alba, IV, March 22, 2024. Read more here.
WEBINAR: Unlocking the Secrets of Debriefings, Government Evaluation of Proposals and Protests, Katherine B. Burrows, Eric Valle, March 28, 2024. Read more here.
CIO-SP4 Protests in Federal Claims Court Prompt Extension Request for Existing Vehicle, FedScoop
NITAAC is requesting to extend the existing vehicle, CIO-SP3, to October 29, the agency confirmed. New bid protests filed in the U.S. Court of Federal Claims over a $50 billion, governmentwide IT contract vehicle known as CIO-SP4 prompted the agency handling it to request an extension of the existing vehicle, an official confirmed. Read more here.
FALSE CLAIMS ACT / AUDITS & INVESTIGATIONS / LITIGATION & DISPUTE RESOLUTION
Settlements and Judgments from FCA and Fraud Matters Top $2.68 Billion in 2023, PilieroMazza Blog, Matthew E. Feinberg
On February 22, the Department of Justice (DOJ) released its annual statistical report (Annual Report) regarding settlements and judgments obtained in the False Claims Act (FCA) and fraud matters for Fiscal Year (FY) 2023. Over the course of the fiscal year, which ended on September 30, 2023, the government recouped $2,689,447,914, a 20% increase compared to FY 2022 but well below the average annual recoveries over the last 15 years (approximately $3.6 Billion). PilieroMazza offers key takeaways from the Annual Report and what they mean for government contractors facing FCA claims in 2024 and beyond.
Upcoming False Claims Act Presentations
PM WEBINAR: PilieroMazza Annual Review: What DOJ’s Annual FCA Report Means for Government Contractors, Matthew E. Feinberg, Jacqueline K. Unger, March 13, 2024. Read more here.
Amid Budget Squeeze, FLRA Panel Regs Encourage Electronic Documents Filing, Government Executive
Less physical paper taken in by the board that settles bargaining-table disputes between unions and agencies will help streamline workloads as its parent agency reduces its office footprint due to budget woes. Read more here.
Upcoming Labor & Employment Presentations
CONFERENCE: From Compliance to Competitiveness: Revamped DBA Rule Reshapes Labor Landscape for Construction Contractors, Nichole D. Atallah, Sarah L. Nash, March 11, 2024. Read more here.
CONFERENCE: Panel: A Focus on Legal Policy, Nichole D. Atallah, March 14, 2024. Read more here.
PM WEBINAR: New Wave of Pay Transparency Requirements Affects Employers and Federal Contractors, Sarah L. Nash, Sara N. Strosser, April 4, 2024. Read more here.
Federal Acquisition Regulation (FAR) Council: Pre-Rule Pending Regulatory Review: Prohibition on Certain Semiconductor Products and Services: On February 21, the Department of Defense, General Services Administration, and the National Aeronautics and Space Administration sent a Pre-Rule to the Office of Management and Budget (OMB) for regulatory review. This rule will prohibit agencies from (1) procuring or obtaining, or extending or renewing a contract to procure or obtain, any electronic parts, products, or services that include covered semiconductor products or services; or (2) entering into a contract, or extending or renewing a contract, with an entity to procure or obtain electronic parts or products that include covered semiconductor products or services. This rule is issued pursuant to section 5949(a) of the National Defense Authorization Act for Fiscal Year 2023. The rule is anticipated to affect small businesses. More information is available here.
Department of Defense (DOD):
- Notice: Defense Federal Acquisition Regulation Supplement (DFARS), Acquisition of Information Technology: On February 23, DOD published a Notice and request for comments about the requirement for the collection of information from contractors regarding security of information technology. Contracting officers and other DOD personnel use the information to ensure that information technology is protected. The clause at DFARS 252.239-7000, Protection Against Compromising Emanations, requires that the contractor provide, upon request of the contracting officer, documentation that information technology used or provided under the contract meets appropriate information assurance requirements. The Notice is available here. Comments close March 25, 2024.
- Notice: Defense Federal Acquisition Regulation Supplement (DFARS), Assessing Contractor Implementation of Cybersecurity Requirements: On February 26, DOD published a Notice and request for comments about the assessment of vulnerabilities in DOD’s supply chain and steps to correct deficiencies. The collection of information is necessary to ensure Defense Industrial Base (DIB) contractors that have not fully implemented the National Institute of Standards and Technology (NIST) Special Publication (SP) 800-171 security requirements pursuant to the clause at DFARS 252.204-7012 begin correcting these deficiencies immediately. The unpublished Notice is available here. Comments will close 60 days after publication in the Federal Register (approximately April 26, 2024).
- Announcement: Informational Video, Cybersecurity Maturity Model Certification (CMMC) Program: On February 21, DOD will publish an announcement regarding an informational video about the CMMC Program. The proposed rule establishes requirements for a comprehensive and scalable assessment mechanism to ensure defense contractors and subcontractors have, as part of the CMMC Program, implemented required existing security requirements for Federal Contract Information and Controlled Unclassified Information (CUI) and adds new CUI security requirements for certain priority programs. This document announces that a video file containing an overview briefing of the CMMC proposed rule. The unpublished announcement is available here. The Informational Video is available here.
Industry Groups Push Back on Cyber Incident Rules Requiring “Full Access,” Federal News Network
Proposed cybersecurity rules that would grant the government “full access” to contractor IT systems in the wake of a cyber incident is causing heartburn among industry groups. Read more here.
CISA’s New Plan to Better Align Cybersecurity Operations, Federal News Network
The Cybersecurity and Infrastructure Security Agency is introducing a new strategic approach for 2024 called the Federal Enterprise Operations Cyber Alignment Plan. Its focus is bringing agencies together to compare notes on recent cyber incidents and approaches, and align behind a common path forward, especially for analysts in their security operations centers. Read more here.
CORPORATE & ORGANIZATIONAL GOVERNANCE
Focus on S Corporations, Part 1: Choosing the Right Entity to Meet Your Small Business Goals, PilieroMazza Blog, Abigail “Abby” L. Baker, Paul H. Tracy
Most business owners understand the need to create an entity to operate their business. However, beyond general knowledge, many owners are unsure of when is the right time to create an entity and which type of entity makes sense for their business goals. These choices are complex and vary for each type of business. This is the first in a series of blogs focused on S Corporations (S Corps) where attorneys in PilieroMazza’s Corporate & Organizational Governance Team explore different S Corp entity types, their tax and ownership implications, and requirements. In this blog, we focus on corporations and LLCs, their liability protections, their requirements, and their tax advantages for small businesses operating in the government contracting and commercial business sectors.
Securities and Exchange Commission (SEC) Final Rule: Special Purpose Acquisition Companies (SPACs), Shell Companies, and Projections
On February 26, FinCEN published a Guidance and Final Rule adopting rules to enhance investor protections in initial public offerings by SPACs and in subsequent business combination transactions between SPACs and private operating companies ( de-SPAC transactions). SEC is adopting disclosure requirements about compensation paid to sponsors, conflicts of interest, dilution, and the determination of the board of directors (or similar governing body) of a SPAC regarding whether a de-SPAC transaction is advisable and in the best interests of the SPAC and its security holders. SEC will require a minimum dissemination period for the distribution of security holder communication materials in connection with de-SPAC transactions and require the re-determination of smaller reporting company (“SRC”) status in connection with de-SPAC transactions. The Rules will also address the scope of the safe harbor for forward-looking statements under the Private Securities Litigation Reform Act of 1995. Included will be a rule that would consider any business combination transaction involving a reporting shell company, including a SPAC, to be a sale of securities to the reporting shell company’s shareholders and are adopting amendments to several financial statement requirements applicable to transactions involving shell companies. SEC will provide guidance on the status of potential underwriters in de-SPAC transactions. The published Final Rule is available here and will be effective 125 after publication in the Federal Register (approximately July 1, 2024). Date of compliance for 17 C.F.R. 229.1610 will be 490 days after publication in the Federal Register (approximately June 30 and the date of compliance for the remaining rules is 125 days after publication in the Federal Register (approximately July 1, 2024).
Financial Crimes Enforcement Network (FinCEN) Notice: Renewal without Change of the Beneficial Ownership Requirements for Legal Entity Customers
On February 26, FinCEN will publish a Notice and request for comments about covered financial institutions’ requirement to collect, and to maintain records of, the information used to identify and verify the identity of each beneficial owner of their legal entity customers, subject to certain exclusions and exemptions. The published Notice is available here. Comments will close 60 days after publication in the Federal Register (approximately April 26, 2024).