81 FR 9783 - Defense Federal Acquisition Regulation Supplement: Uniform Procurement Identification (DFARS Case 2015-D011)

DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System

Federal Register Volume 81, Issue 38 (February 26, 2016)

DoD is issuing a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to conform with the uniform procurement identification procedures implemented in the Federal Acquisition Regulation (FAR).

[Federal Register Volume 81, Number 38 (Friday, February 26, 2016)]
[Rules and Regulations]
[Pages 9783-9786]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-04189]



[[Page 9783]]

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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 204, 232, 243, and Appendix F to Chapter 2

[Docket DARS-2015-0025]
RIN 0750-AI54


Defense Federal Acquisition Regulation Supplement: Uniform 
Procurement Identification (DFARS Case 2015-D011)

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

ACTION: Final rule.

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SUMMARY: DoD is issuing a final rule amending the Defense Federal 
Acquisition Regulation Supplement (DFARS) to conform with the uniform 
procurement identification procedures implemented in the Federal 
Acquisition Regulation (FAR).

DATES: Effective Date: February 26, 2016.

FOR FURTHER INFORMATION CONTACT: Ms. Jennifer Johnson, telephone 571-
372-6100.

SUPPLEMENTARY INFORMATION: 

I. Background

    DoD published a proposed rule in the Federal Register at 80 FR 
30030 on May 26, 2015, to amend the DFARS to conform with the uniform 
procurement identification procedures implemented in the FAR through 
final rule 2012-023 (79 FR 61739, published October 14, 2014, became 
effective November 13, 2014). The final FAR rule implemented a uniform 
procurement instrument identification system for various procurement 
transactions across the Federal Government. DFARS coverage of uniform 
procurement instrument identification must be synchronized with the FAR 
coverage so that the identification numbers of DoD-issued contracts, 
orders, and other procurement instruments will comply with FAR subpart 
4.16 as amended by final FAR rule 2012-023. Three respondents submitted 
public comments in response to the proposed rule.

II. Discussion and Analysis

    DoD reviewed the public comments in the development of the final 
rule. A discussion of the comments and the significant changes made to 
the rule as a result of those comments is provided as follows:

A. Summary of Significant Changes

    This final rule makes the following significant changes from the 
proposed rule:
     DFARS 204.1601(b)--The date of October 1, 2015, which was 
the date DoD Components were encouraged to start implementation, has 
been removed since that date has passed.
     DFARS 204.1603(a)(3)--Clarifies use of the letters C, H, 
M, and T in the ninth position of a procurement instrument identifier 
(PIID).
     DFARS 232.905(b)(1)(iii)--Clarifies that basic contract or 
ordering agreement numbers may be included on invoices and receiving 
reports in addition to the task order or delivery order numbers.

B. Analysis of Public Comments

1. General
a. Consistency With the FAR
    Comment: One respondent requested assurance that the rule is 
consistent with the FAR due to uncertainty regarding how uniform 
procurement identification is being implemented.
    Response: The implementation of uniform procurement identification 
in the DFARS is consistent with the FAR. The amendments to the DFARS 
accomplish the following: (1) Removal of the language that is 
duplicative of FAR language; (2) relocation of the remaining, 
nonduplicative DFARS language to subpart 204.16 to align with FAR 
subpart 4.16; (3) establishment of a timeline for implementation within 
DoD of the changes now required by the FAR; (4)confirmation that DoD 
will continue to use PIIDs that are 13 characters in length; and (5) 
revision of procedures for payment documentation and Wide Area WorkFlow 
(WAWF) to implement the FAR changes to task order and delivery order 
PIIDs.
b. Request for Meeting With Industry
    Comment: One respondent requested that DoD hold a meeting with 
industry to ensure the concerns of industry have been considered and 
addressed before the rule takes effect.
    Response: FAR final rule 2012-023, containing the uniform PIID 
requirements, was published in October 2014, and the few public 
comments received were addressed at that time. The DFARS final rule 
does not change any of the FAR requirements. Therefore, a public 
meeting is deemed to be unnecessary.
2. Implementation
a. Timing of Implementation
    Comment: One respondent asked that the uniform PIID changes not 
take effect before contract writing, invoicing, and other systems are 
modified to accommodate the changes.
    Response: Each DoD Component is scheduling its implementation in 
order to complete the transition by the beginning of fiscal year 2017. 
The enterprise Procurement Desktop Defense (PD2) contract writing 
system (also known as the Standard Procurement System, or SPS) and WAWF 
have been tested before fielding the changes. The WAWF Invoices Receipt 
Acceptance and Property Transfer (iRAPT) Electronic Data Interchange 
and File Transfer Protocol Implementation Guides have been updated.
b. Impact on Industry Systems
    Comment: One respondent commented that there is uncertainty 
regarding how the uniform PIID changes will impact industry systems and 
the resources required to insert the new data constructs. Another 
respondent commented that industry will need to modify existing systems 
integrating with WAWF.
    Response: Implementation of the FAR uniform PIID requirements in 
the DFARS is designed to limit the number of changes necessary to 
systems. At this time, the changes are essentially limited to the 
structure of task order and delivery order numbers issued under DoD 
ordering instruments, as well as modifications to these orders. 
However, these changes are consistent with the way task order and 
delivery order numbers issued under non-DoD ordering instruments have 
been constructed for many years. The anticipated impact to industry 
systems is as limited as possible with this implementation strategy.
c. Sufficient Time for Industry Implementation
    Comment: Two respondents commented that industry must be allowed 
sufficient time to adequately implement the changes, including time to 
modify and test applicable systems. One respondent also commented that 
the short transition schedule will require double entry of data in 
industry systems and WAWF until the changes can be implemented.
    Response: The FAR final rule containing the uniform PIID 
requirements became effective November 13, 2014. Each DoD Component is 
scheduling its implementation in order to transition by

[[Page 9784]]

the beginning of fiscal year 2017. For DoD, the rule primarily affects 
the structure of task and delivery order numbers issued under DoD 
ordering instruments, as well as modifications to those orders. 
Implementation of the uniform PIID requirements will not require double 
entry of data in WAWF. If a task order or delivery order is issued 
prior to the transition to the new PIID numbering requirements, 
invoices will be submitted as they are today for orders placed under 
DoD ordering instruments. If a task order or delivery order is issued 
after the transition, invoices will be submitted in accordance with the 
changes specified in this DFARS final rule, which is the same process 
currently followed for invoices for task orders and delivery orders 
issued under non-DoD ordering instruments (e.g., Federal Supply 
Schedules).
3. System Issues
a. Contracts Issued in 2015 or Earlier
    Comment: One respondent stated that it is unclear how the 
requirements of the rule will work with contracts issued in 2015 or 
earlier that were not numbered in accordance with the uniform PIID 
requirements.
    Response: The DFARS changes are intended to apply prospectively. 
Therefore, existing contract numbers are not required to be updated, 
although this is not prohibited if the DoD Component chooses to do so. 
The DFARS changes address this possibility at 204.1601(c). Order 
numbers for task orders and delivery orders already issued under DoD 
indefinite-delivery contracts and ordering agreements are not required 
to be changed, and modifications to these orders may continue to use 
two-character modification numbers. However, new orders issued after 
the transition to the new numbering structure must be numbered in 
accordance with the uniform PIID requirements; likewise, modifications 
to new orders also must use the new numbering structure.
b. Identification of Basic Contract or Agreement on Invoice and 
Receiving Reports
    Comment: Two respondents expressed concern about the omission of 
basic contract and ordering agreement numbers from invoices for task 
orders and delivery orders, which would eliminate the linkage between 
the contract or agreement and its orders. This would make those orders 
more difficult to close out. Both respondents proposed language to 
allow contractors to include the basic contract and ordering agreement 
numbers on the invoices.
    Response: Invoices for task orders and delivery orders numbered in 
accordance with the uniform PIID requirements will be directly 
traceable to the orders and to the basic contract or ordering 
agreement. The order itself contains the order's PIID as well as the 
PIID for the contract or agreement under which it was placed. 
Additionally, WAWF iRAPT will implement a change proposal in the spring 
of 2016 that will enable improved search capabilities.
    Regarding the proposed language to allow contractors to include the 
basic contract and ordering agreement numbers on invoices, DoD concurs 
and has incorporated this language into the final rule.
c. Traceability of Purchase Orders in Systems
    Comment: One respondent identified an issue with the uniform PIID 
requirements that results in loss of the capability to search by 
purchase order identifier, which will inhibit traceability. The 
respondent also referenced a future release of WAWF iRAPT that would 
correct the issue.
    Response: Concur that WAWF iRAPT release 5.9, scheduled to be 
implemented in the spring of 2016, will correct the search capability 
issue. This will mitigate the traceability concern.
d. Identification of Hybrid Contracts
    Comment: One respondent commented that, although current DFARS text 
prohibits the use of the letter C in the ninth position of a PIID for 
contracts that include both definite and indefinite delivery 
requirements, the proposed DFARS changes do not continue this 
prohibition. The proposed DFARS changes would allow orders to be placed 
under a ``C'' type contract. The respondent asked if this shift from 
existing DoD policy was intentional.
    Response: There is no shift in policy. The DFARS final rule 
includes clarifying language at DFARS 204.1603(a)(3)(C) to prohibit use 
of the letter C or H designators for contracts or agreements that 
include provisions for orders or calls.
e. Inclusion of Clauses in Task or Delivery Orders
    Comment: One respondent recommended that all contract clauses from 
the basic contract or ordering agreement be included in each task or 
delivery order.
    Response: This comment is outside the scope of the rule.

C. Other Changes

    The final rule includes some minor editorial changes for clarity 
and consistency in the rule text.
     The examples of proper supplementary PIID numbering, 
previously located under DFARS 204.1603 are moved to DFARS PGI.
     The proposed rule deleted the text at DFARS 239.7407. This 
text is not deleted in the final rule.
     A cross reference to relocated text is updated at DFARS 
243.172.

III. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). E.O. 
13563 emphasizes the importance of quantifying both costs and benefits, 
of reducing costs, of harmonizing rules, and of promoting flexibility. 
This is not a significant regulatory action and, therefore, was not 
subject to review under section 6(b) of E.O. 12866, Regulatory Planning 
and Review, dated September 30, 1993. This rule is not a major rule 
under 5 U.S.C. 804.

IV. Regulatory Flexibility Act

    A final regulatory flexibility analysis has been prepared 
consistent with the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., 
and is summarized as follows:
    This final rule amends the Defense Federal Acquisition Regulation 
Supplement (DFARS) to conform with the uniform procurement instrument 
identification procedures implemented in the Federal Acquisition 
Regulation (FAR). The amendments to the DFARS accomplish the following: 
(1) Removal of the language that is duplicative of FAR language; (2) 
relocation of the remaining, nonduplicative DFARS language to subpart 
204.16 to align with FAR subpart 4.16; (3) establishment of a timeline 
for implementation within DoD of the changes now required by the FAR; 
(4)confirmation that DoD will continue to use procurement instrument 
identifiers (PIIDs) that are 13 characters in length; and (5) revision 
of procedures for payment documentation and Wide Area WorkFlow (WAWF) 
to implement the FAR changes to task order and delivery order PIIDs.
    There were no significant issues raised by the public in response 
to the initial regulatory flexibility analysis provided in the proposed 
rule.

[[Page 9785]]

    This rule is not expected to have a significant impact on a 
substantial number of small entities. The primary changes that will 
impact DoD contractors from this final DFARS rule are essentially 
limited to the structure of task and delivery order numbers issued 
under DoD ordering instruments, as well as modifications to these 
orders.
    This rule does not add any new information collection, reporting, 
or recording keeping requirements. The existing recordkeeping 
requirements are limited to properly recording contract and other 
procurement instrument identification numbers and inserting them into 
documents (e.g., invoices) as required under Government contracts. 
Preparation of these records requires clerical and analytical skills to 
create the documents and input them into the appropriate electronic 
systems.
    No alternatives were determined to be available that will 
accomplish the objectives of the rule.

V. Paperwork Reduction Act

    The rule contains information collection requirements that require 
the approval of the Office of Management and Budget under the Paperwork 
Reduction Act (44 U.S.C. chapter 35); however, these changes to the 
DFARS do not impose additional information collection requirements to 
the paperwork burden previously approved under OMB Control Number 0704-
0248 entitled ``Material Inspection and Receiving Report.''

List of Subjects in 48 CFR Parts 204, 232, 243, and Appendix F to 
Chapter 2

    Government procurement.

Jennifer L. Hawes,
Editor, Defense Acquisition Regulations System.

    Therefore, 48 CFR parts 204, 232, 243, and appendix F to chapter 2 
are amended as follows:

0
1. The authority citation for 48 CFR parts 204, 232, 243, and appendix 
F to chapter 2 continues to read as follows:

    Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.

PART 204--ADMINISTRATIVE MATTERS

0
2. Add subpart 204.16 to read as follows:
Subpart 204.16--Uniform Procurement Instrument Identifiers
Sec.
204.1601 Policy.
204.1603 Procedures.
204.1670 Cross reference to Federal Procurement Data System.
204.1671 Order of application for modifications.

Subpart 204.16--Uniform Procurement Instrument Identifiers


204.1601  Policy.

    (a) Establishment of a Procurement Instrument Identifier (PIID). Do 
not reuse a PIID once it has been assigned. Do not assign the same PIID 
to more than one task or delivery order, even if they are issued under 
different base contracts or agreements.
    (b) Transition of PIID numbering. Effective October 1, 2016, all 
DoD components shall comply with the PIID numbering requirements of FAR 
subpart 4.16 and this subpart for all new solicitations, contracts, 
orders, and agreements issued, and any amendments and modifications to 
those new actions. See also PGI 204.1601(b).
    (c) Change in the PIID after its assignment. When a PIID is changed 
after contract award, the new PIID is known as a continued contract.
    (i) A continued contract--
    (A) Does not constitute a new procurement;
    (B) Incorporates all prices, terms, and conditions of the 
predecessor contract effective at the time of issuance of the continued 
contract;
    (C) Operates as a separate contract independent of the predecessor 
contract once issued; and
    (D) Shall not be used to evade competition requirements, expand the 
scope of work, or extend the period of performance beyond that of the 
predecessor contract.
    (ii) When issuing a continued contract, the contracting officer 
shall--
    (A) Issue an administrative modification to the predecessor 
contract to clearly state that--
    (1) Any future awards provided for under the terms of the 
predecessor contract (e.g., issuance of orders or exercise of options) 
will be accomplished under the continued contract; and
    (2) Supplies and services already acquired under the predecessor 
contract shall remain solely under that contract for purposes of 
Government inspection, acceptance, payment, and closeout; and
    (B) Follow the procedures at PGI 204.1601(c).


204.1603  Procedures.

    (a) Elements of a PIID. DoD-issued PIIDs are thirteen characters in 
length. Use only alpha-numeric characters, as prescribed in FAR 4.1603 
and this subpart. Do not use the letter I or O in any part of the PIID.
    (3) Position 9.
    (A) DoD will use three of the letters reserved for departmental or 
agency use in FAR 4.1603(a)(3) in this position as follows:
    (1) Use M to identify purchase orders and task or delivery orders 
issued by the enterprise FedMall system.
    (2) Use S to identify broad agency announcements.
    (3) Use T to identify automated requests for quotations by 
authorized legacy contract writing systems. See PGI 
204.1603(a)(3)(A)(3) for the list of authorized systems.
    (B) Do not use other letters identified in FAR 4.1603(a)(3) as 
``Reserved for future Federal Governmentwide use'' or ``Reserved for 
departmental or agency use'' in position 9 of the PIID.
    (C) Do not use the letter C or H for contracts or agreements with 
provisions for orders or calls.
    (4) Positions 10 through 17. In accordance with FAR 4.1603(a)(4), 
DoD-issued PIIDs shall only use positions 10 through 13 to complete the 
PIID. Enter the serial number of the instrument in these positions. A 
separate series of serial numbers may be used for any type of 
instrument listed in FAR 4.1603(a)(3). DoD components assign such 
series of PIID numbers sequentially. A DoD component may reserve blocks 
of numbers or alpha-numeric numbers for use by its various activities.
    (b) Elements of a supplementary PIID. In addition to the 
supplementary PIID numbering procedures in FAR 4.1603(b), follow the 
procedures contained in paragraphs (b)(2)(ii)(1) and (2) of this 
section. See PGI 204.1603(b) for examples of proper supplementary PIID 
numbering.
    (2)(ii) Positions 2 through 6. In accordance with FAR 
4.1603(b)(2)(ii), DoD-issued supplementary PIIDs shall, for positions 2 
through 6 of modifications to contracts and agreements, comply with the 
following:
    (1) Positions 2 and 3. These two digits may be either alpha or 
numeric characters, except--
    (i) Use K, L, M, N, P, and Q only in position 2, and only if the 
modification is issued by the Air Force and is a provisioned item 
order;
    (ii) Use S only in position 2, and only to identify modifications 
issued to provide initial or amended shipping instructions when--
    (a) The contract has either FOB origin or destination delivery 
terms; and
    (b) The price changes;
    (iii) Use T, U, V, W, X, or Y only in position 2, and only to 
identify modifications issued to provide initial or amended shipping 
instructions when--

[[Page 9786]]

    (a) The contract has FOB origin delivery terms; and
    (b) The price does not change; and
    (iv) Use Z only in position 2, and only to identify a modification 
which definitizes a letter contract or a previously issued 
undefinitized modification.
    (2) Positions 4 through 6. These positions are always numeric. Use 
a separate series of serial numbers for each type of modification 
listed in paragraph (b)(2)(ii) of this section.


204.1670  Cross reference to Federal Procurement Data System.

    Detailed guidance on mapping PIID and supplementary PIID numbers 
stored in the Electronic Document Access system to data elements 
reported in the Federal Procurement Data System can be found in PGI 
204.1670.


204.1671  Order of application for modifications.

    (a) Circumstances may exist in which the numeric order of the 
modifications to a contract is not the order in which the changes to 
the contract actually take effect.
    (b) In order to determine the sequence of modifications to a 
contract or order, the modifications will be applied in the following 
order--
    (1) Modifications will be applied in order of the effective date on 
the modification;
    (2) In the event of two or more modifications with the same 
effective date, modifications will be applied in signature date order; 
and
    (3) In the event of two or more modifications with the same 
effective date and the same signature date, procuring contracting 
office modifications will be applied in numeric order, followed by 
contract administration office modifications in numeric order.

Subpart 204.70--[Removed and Reserved]

0
3. Remove and reserve subpart 204.70, consisting of sections 204.7000 
through 204.7007.

PART 232--CONTRACT FINANCING

0
4. Add section 232.905 to read as follows:


232.905  Payment documentation and process.

    (b)(1)(iii) For task and delivery orders numbered in accordance 
with FAR 4.1603 and 204.1603, the 13-character order number may serve 
as the contract number on invoices and receiving reports. The contract 
or agreement number under which the order was placed may be omitted 
from invoices and receiving reports. The contractor may choose to 
identify both the contract number and the 13-character order number on 
invoices and receiving reports. Task and delivery orders numbered with 
a four-position alpha-numeric call or order serial number shall include 
both the 13-position basic contract Procurement Instrument Identifier 
and the four-position order number.

PART 243--CONTRACT MODIFICATIONS


243.172  [Amended]

0
5. Amend section 243.172 by removing ``204.7007'' and adding 
``204.1671'' in its place.

0
6. Amend appendix F to chapter 2, in section F-301, by revising 
paragraph (b)(1) to read as follows:

Appendix F to Chapter 2--Material Inspection and Receiving Report

* * * * *
F-301 Preparation instructions.
* * * * *
    (b) * * *
    (1) Contract no/delivery order no.
    (i) For stand-alone contracts, enter the 13-position alpha-
numeric basic Procurement Instrument Identifier (PIID) of the 
contract. For task and delivery orders numbered in accordance with 
FAR 4.1603 and DFARS 204.1603, enter the 13-character order number. 
The contract or agreement number under which the order was placed 
may be omitted from the WAWF RR. Alternatively, the contractor may 
choose to enter the contract number on the WAWF RR in addition to 
the 13-character order number. If the order has only a four-position 
alpha-numeric call or order serial number, enter both the 13-
position basic contract PIID and the four-position order number.
    (ii) Except as indicated in paragraph (b)(1)(iii) of this 
appendix, do not enter supplementary numbers used in conjunction 
with basic PIIDs to identify--
    (A) Modifications of contracts and agreements;
    (B) Modifications to calls or orders; or
    (C) Document numbers representing contracts written between 
contractors.
    (iii) When shipping instructions are furnished and shipment is 
made before receipt of the confirming contract modification (SF 30, 
Amendment of Solicitation/Modification of Contract), enter a comment 
in the Misc. Info Tab to this effect. This will appear in the 
Comments section of the printed WAWF RR.
* * * * *
[FR Doc. 2016-04189 Filed 2-25-16; 8:45 am]
BILLING CODE 5001-06-P