9000-0018_justification_2007

SUPPORTING STATEMENT
FOR PAPERWORK REDUCTION ACT SUBMISSION
9000-0018, CERTIFICATION OF INDEPENDENT PRICE DETERMINATION
AND PARENT COMPANY AND IDENTIFYING DATA
A.

Justification.

1. Administrative requirements. Agencies are required to
report under 41 U.S.C. 252(d) and 10 U.S.C. 2305(d)
suspected violations of the antitrust laws (e.g., collusive
bidding, identical bids, uniform estimating systems, etc.)
to the Attorney General.
2. Uses of information. As a first step in assuring that
Government contracts are not awarded to firms violating
such laws, offerors on Government contracts must complete
the certificate of independent price determination. An
offer will not be considered for award where the
certificate has been deleted or modified. Deletions or
modifications of the certificate and suspected false
certificates are reported to the Attorney General.
Identification of the parent company is required to
eliminate some suspected cases of antitrust violations.
3. Consideration of information technology. We use
improved information technology to the maximum extent
practicable. Where both the Government agency and
contractors are capable of electronic interchange, the
contractors may submit this information collection
requirement electronically.
4. Efforts to identify duplication. This requirement is
being issued under the Federal Acquisition Regulation (FAR)
which has been developed to standardize Federal procurement
practices and eliminate unnecessary duplication.
5. If the collection of information impacts small
businesses or other entities, describe methods used to
minimize burden. The burden applied to small businesses is
the minimum consistent with applicable laws, executive
orders, regulations, and prudent business practices.
6. Describe consequence to Federal program or policy
activities if the collection is not conducted or is
conducted less frequently. Collection of information on a
basis other than solicitation-by-solicitation is not
practical.

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2008 Justification

7. Special circumstances for collection. Collection is
consistent with guidelines in 5 CFR 1320.6.
8. Efforts to consult with person outside the agency.
Under the procedures established for development of the
FAR, agency and public comments were solicited and each
comment addressed before finalization of the text. A notice
in the Federal Register at 72 FR 64587, November 16, 2007,
made this this requirement available to the public and
requested comments.
9. Explanation of any decision to provide any payment or
gift to respondents, other than reenumeration of
contractors or guarantees. Not applicable.
10. Describe assurance of confidentiality provided to
respondents. This information is disclosed only to the
extent consistent with prudent business practices and
current regulations.
11. Additional justification for questions of a sensitive
nature. No sensitive questions are involved.
12 & 13. Estimated total annual public hour and cost
burden. Time required to read and prepare information is
estimated at .04 hours for the first completion, .0083
hours for subsequent completions, or an average of .01
hours per completion.
Certification of Independent Price Determination
Estimated respondents/yr......................
Responses annually............................x
Total annual responses........................
Estimated hrs/response........................x
Estimated total burden/hrs....................
Estimated cost to public ($24 + 75% OH).......

64,250
20
1,285,000
.01
12,850
$539,700

Parent Company and Identifying Data
Estimated respondents/yr......................
Responses annually............................x
Total annual responses........................
Estimated hrs/responses.......................x
Total burden hours............................
Cost to public ($24 x 75% OH).................

64,250
20
1,285,000
.01
12,850
$539,700

2
2008 Justification

14. Estimated cost to the Government. Time required for
Governmentwide review is estimated at .0083 hours per
response.
Certification of Independent Price Determination
Reviewing time/hr.............................
.0083
Responses/yr..................................x
1,285,000
Review time/yr................................
10,665.5
Average wages/hr..............................x
$20
Average wages/yr................................. $213,310
Plus benefits and overhead of 100%............+
213,310
Total Government cost........................
$426,620
Parent Company and Identification Data
Reviewing time/hr.............................
Responses/yr.................................x
Review time/yr...............................
Average wage/hr..............................x
Average wage/yr..............................
Plus benefits and overhead of 100%...........+
Total Government cost........................

.0083
1,285,000
10,665.5
20
$213,310
213,310
$426,620

15. Explain reasons for program changes or adjustment
reported in Item 13 or 14. This submission requests an
extension of OMB approval of an information collection
requirement in the FAR. The information collection
requirement in the FAR remains unchanged.
16. Outline plans for published results of information
collections. Results will not be tabulated or published.
17. Approval not to display expiration date.
applicable.

Not

18. Explanation of exception to certification statement.
Not applicable.
B. Collections of Information Employing Statistical
Methods.
Statistical methods are not used in this information
collection.

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2008 Justification

SUBPART 3.1—SAFEGUARDS
3.000 Scope of part.
This part prescribes policies and procedures for avoiding
improper business practices and personal conflicts of interest
and for dealing with their apparent or actual occurrence.

Subpart 3.1—Safeguards
3.101 Standards of conduct.
3.101-1 General.
Government business shall be conducted in a manner
above reproach and, except as authorized by statute or regulation, with complete impartiality and with preferential treatment for none. Transactions relating to the expenditure of
public funds require the highest degree of public trust and an
impeccable standard of conduct. The general rule is to avoid
strictly any conflict of interest or even the appearance of a
conflict of interest in Government-contractor relationships.
While many Federal laws and regulations place restrictions on
the actions of Government personnel, their official conduct
must, in addition, be such that they would have no reluctance
to make a full public disclosure of their actions.
3.101-2 Solicitation and acceptance of gratuities by
Government personnel.
As a rule, no Government employee may solicit or accept,
directly or indirectly, any gratuity, gift, favor, entertainment,
loan, or anything of monetary value from anyone who (a) has
or is seeking to obtain Government business with the
employee’s agency, (b) conducts activities that are regulated
by the employee’s agency, or (c) has interests that may be substantially affected by the performance or nonperformance of
the employee’s official duties. Certain limited exceptions are
authorized in agency regulations.
3.101-3 Agency regulations.
(a) Agencies are required by Executive Order 11222 of
May 8, 1965, and 5 CFR 735 to prescribe “Standards of Conduct.” These agency standards contain—
(1) Agency-authorized exceptions to 3.101-2; and
(2) Disciplinary measures for persons violating the
standards of conduct.
(b) Requirements for employee financial disclosure and
restrictions on private employment for former Government
employees are in Office of Personnel Management and
agency regulations implementing Public Law 95-521, which
amended 18 U.S.C. 207.
3.102 [Reserved]

3.103-2
3.103 Independent pricing.
3.103-1 Solicitation provision.
The contracting officer shall insert the provision at
52.203-1, Certificate of Independent Price Determination, in
solicitations when a firm-fixed-price contract or fixed-price
contract with economic price adjustment is contemplated,
unless—
(a) The acquisition is to be made under the simplified
acquisition procedures in Part 13;
(b) [Reserved]
(c) The solicitation is a request for technical proposals
under two-step sealed bidding procedures; or
(d) The solicitation is for utility services for which rates are
set by law or regulation.
3.103-2 Evaluating the certification.
(a) Evaluation guidelines. (1) None of the following, in
and of itself, constitutes “disclosure” as it is used in
paragraph (a)(2) of the Certificate of Independent Price
Determination (hereafter, the certificate):
(i) The fact that a firm has published price lists, rates,
or tariffs covering items being acquired by the Government.
(ii) The fact that a firm has informed prospective customers of proposed or pending publication of new or revised
price lists for items being acquired by the Government.
(iii) The fact that a firm has sold the same items to
commercial customers at the same prices being offered to the
Government.
(2) For the purpose of paragraph (b)(2) of the certificate, an individual may use a blanket authorization to act as
an agent for the person(s) responsible for determining the
offered prices if—
(i) The proposed contract to which the certificate
applies is clearly within the scope of the authorization; and
(ii) The person giving the authorization is the person
within the offeror’s organization who is responsible for determining the prices being offered at the time the certification is
made in the particular offer.
(3) If an offer is submitted jointly by two or more concerns, the certification provided by the representative of each
concern applies only to the activities of that concern.
(b) Rejection of offers suspected of being collusive. (1) If
the offeror deleted or modified paragraph (a)(1) or (a)(3) or
paragraph (b) of the certificate, the contracting officer shall
reject the offeror’s bid or proposal.
(2) If the offeror deleted or modified paragraph (a)(2) of
the certificate, the offeror must have furnished with its offer a
signed statement of the circumstances of the disclosure of
prices contained in the bid or proposal. The chief of the contracting office shall review the altered certificate and the statement and shall determine, in writing, whether the disclosure
was made for the purpose or had the effect of restricting com3.1-1

3.103-3
petition. If the determination is positive, the bid or proposal
shall be rejected; if it is negative, the bid or proposal shall be
considered for award.
(3) Whenever an offer is rejected under paragraph (b)(1)
or (b)(2) of this section, or the certificate is suspected of being
false, the contracting officer shall report the situation to the
Attorney General in accordance with 3.303.
(4) The determination made under paragraph (b)(2) of
this section shall not prevent or inhibit the prosecution of any
criminal or civil actions involving the occurrences or transactions to which the certificate relates.
3.103-3 The need for further certifications.
A contractor that properly executed the certificate before
award does not have to submit a separate certificate with each
proposal to perform a work order or similar ordering instrument issued pursuant to the terms of the contract, where the
Government’s requirements cannot be met from another
source.
3.104 Procurement integrity.
3.104-1 Definitions.
As used in this section—
“Agency ethics official” means the designated agency ethics official described in 5 CFR 2638.201 or other designated
person, including—
(1)
Deputy
ethics
officials
described
in
5 CFR 2638.204, to whom authority under 3.104-6 has been
delegated by the designated agency ethics official; and
(2) Alternate designated agency ethics officials
described in 5 CFR 2638.202(b).
“Compensation” means wages, salaries, honoraria, commissions, professional fees, and any other form of compensation, provided directly or indirectly for services rendered.
Compensation is indirectly provided if it is paid to an entity
other than the individual, specifically in exchange for services
provided by the individual.
“Contractor bid or proposal information” means any of the
following information submitted to a Federal agency as part
of or in connection with a bid or proposal to enter into a Federal agency procurement contract, if that information has not
been previously made available to the public or disclosed
publicly:
(1) Cost or pricing data (as defined by
10 U.S.C. 2306a(h)) with respect to procurements subject to
that section, and section 304A(h) of the Federal Property and
Administrative Services Act of 1949 (41 U.S.C. 254b(h)),
with respect to procurements subject to that section.
(2) Indirect costs and direct labor rates.
(3) Proprietary information about manufacturing processes, operations, or techniques marked by the contractor in
accordance with applicable law or regulation.
3.1-2

FEDERAL ACQUISITION REGULATION
(4) Information marked by the contractor as “contractor
bid or proposal information” in accordance with applicable
law or regulation.
(5) Information marked in accordance with
52.215-1(e).
“Decision to award a subcontract or modification of subcontract” means a decision to designate award to a particular
source.
“Federal agency procurement” means the acquisition (by
using competitive procedures and awarding a contract) of
goods or services (including construction) from non-Federal
sources by a Federal agency using appropriated funds. For
broad agency announcements and small business innovative
research programs, each proposal received by an agency constitutes a separate procurement for purposes of the Act.
“In excess of $10,000,000” means—
(1) The value, or estimated value, at the time of award,
of the contract, including all options;
(2) The total estimated value at the time of award of all
orders under an indefinite-delivery, indefinite-quantity, or
requirements contract;
(3) Any multiple award schedule contract, unless the
contracting officer documents a lower estimate;
(4) The value of a delivery order, task order, or an order
under a Basic Ordering Agreement;
(5) The amount paid or to be paid in settlement of a
claim; or
(6) The estimated monetary value of negotiated overhead or other rates when applied to the Government portion
of the applicable allocation base.
“Official” means—
(1) An officer, as defined in 5 U.S.C. 2104;
(2) An employee, as defined in 5 U.S.C. 2105;
(3) A member of the uniformed services, as defined in
5 U.S.C. 2101(3); or
(4) A special Government employee, as defined in
18 U.S.C. 202.
“Participating personally and substantially in a Federal
agency procurement” means—
(1) Active and significant involvement of an official in
any of the following activities directly related to that
procurement:
(i) Drafting, reviewing, or approving the specification or statement of work for the procurement.
(ii) Preparing or developing the solicitation.
(iii) Evaluating bids or proposals, or selecting a
source.
(iv) Negotiating price or terms and conditions of the
contract.
(v) Reviewing and approving the award of the
contract.

SUBPART 3.3—REPORTS OF SUSPECTED ANTITRUST VIOLATIONS

Subpart 3.3—Reports of Suspected Antitrust
Violations
3.301 General.
(a) Practices that eliminate competition or restrain trade
usually lead to excessive prices and may warrant criminal,
civil, or administrative action against the participants. Examples of anticompetitive practices are collusive bidding, follow-the-leader pricing, rotated low bids, collusive price
estimating systems, and sharing of the business.
(b) Contracting personnel are an important potential source
of investigative leads for antitrust enforcement and should
therefore be sensitive to indications of unlawful behavior by
offerors and contractors. Agency personnel shall report, in
accordance with agency regulations, evidence of suspected
antitrust violations in acquisitions for possible referral to—
(1) The Attorney General under 3.303; and
(2) The agency office responsible for contractor debarment and suspension under Subpart 9.4.
3.302 Definitions.
As used in this subpart—
“Identical bids” means bids for the same line item that are
determined to be identical as to unit price or total line item
amount, with or without the application of evaluation factors
(e.g., discount or transportation cost).
“Line item” means an item of supply or service, specified
in a solicitation, that the offeror must separately price.
3.303 Reporting suspected antitrust violations.
(a) Agencies are required by 41 U.S.C. 253b(i) and
10 U.S.C. 2305(b)(9) to report to the Attorney General any
bids or proposals that evidence a violation of the antitrust
laws. These reports are in addition to those required by
Subpart 9.4.
(b) The antitrust laws are intended to ensure that markets
operate competitively. Any agreement or mutual understanding among competing firms that restrains the natural operation
of market forces is suspect. Paragraph (c) of this section identifies behavior patterns that are often associated with antitrust
violations. Activities meeting the descriptions in
paragraph (c) are not necessarily improper, but they are sufficiently questionable to warrant notifying the appropriate
authorities, in accordance with agency procedures.

3.303
(2) A sudden change from competitive bidding to identical bidding;
(3) Simultaneous price increases or follow-the-leader
pricing;
(4) Rotation of bids or proposals, so that each competitor takes a turn in sequence as low bidder, or so that certain
competitors bid low only on some sizes of contracts and high
on other sizes;
(5) Division of the market, so that certain competitors
bid low only for contracts let by certain agencies, or for contracts in certain geographical areas, or on certain products, and
bid high on all other jobs;
(6) Establishment by competitors of a collusive price
estimating system;
(7) The filing of a joint bid by two or more competitors
when at least one of the competitors has sufficient technical
capability and productive capacity for contract performance;
(8) Any incidents suggesting direct collusion among
competitors, such as the appearance of identical calculation or
spelling errors in two or more competitive offers or the submission by one firm of offers for other firms; and
(9) Assertions by the employees, former employees, or
competitors of offerors, that an agreement to restrain trade
exists.
(d) Identical bids shall be reported under this section if the
agency has some reason to believe that the bids resulted from
collusion.
(e) For offers from foreign contractors for contracts to be
performed outside the United States and its outlying areas,
contracting officers may refer suspected collusive offers to the
authorities of the foreign government concerned for appropriate action.
(f) Agency reports shall be addressed to the—
Attorney General
U.S. Department of Justice
Washington DC 20530
Attention: Assistant Attorney General
Antitrust Division

and shall include—
(1) A brief statement describing the suspected practice
and the reason for the suspicion; and

(c) Practices or events that may evidence violations of the
antitrust laws include—

(2) The name, address, and telephone number of an individual in the agency who can be contacted for further
information.

(1) The existence of an “industry price list” or “price
agreement” to which contractors refer in formulating their
offers;

(g) Questions concerning this reporting requirement may
be communicated by telephone directly to the Office of the
Assistant Attorney General, Antitrust Division.
3.3-1