Information Memorandum
No. 07-042
Subject:
Specialty Metals (10 USC.2533b,
Protection of Strategic Materials Critical to National Security)
(INFORMATION)
Date:
December 8, 2006
Target Audience:
CMO Commanders and Deputy
Commanders, ACOs, QARs
New
Information/Guidance:
- The FY 2007 National
Defense Authorization Act (P.L. 109-364), was enacted into law on October 17,
2006. Section 842 establishes a new specialty metals provision -- 10 USC
2533b (replaces 10 USC 2533a, i.e., the “Berry Amendment”). Implementing
guidance for this law was issued by USD(AT&L)
Memorandum, Class Deviation –Restriction on Procurement of Specialty
Metals, December 6, 2006.
- Many requirements of the
new law reflect regulations previously established in the DFARS. The
most significant changes for DCMA are:
- For contracts awarded after November
15, 2006, DoD can no longer withhold payment while conditionally accepting
noncompliant items (but, DCMA ACOs may continue this practice as outlined in
our March 10, 2006
Specialty Metals Instruction for contracts awarded prior to that
date.)
- An exception for commercially available
electronic components whose specialty metal content is de minimis is
established; and
- A new One-Time Waiver is established
for contracts under which specialty metals were incorporated into items
produced, manufactured or assembled in the US prior to November 16, 2006 and
where final acceptance takes place after that date.
- The USD(AT&L) Memorandum provides
that DCMA remains responsible for reviewing and approving contractor
corrective action plans (CAPs) submitted on a “broad” basis (reference DCMA Information Memorandum
No. 06-183, Berry Amendment Compliance for Specialty Metals, June 8,
2006.)
- Contractor CAPs are the key to assuring
future compliance with the law, serve as the basis for both Domestic
Nonavailability Determinations (DNADs), and are required before the new
One-Time Waiver can be granted.
- DCMA has retained the services of the
U.S. Navy Price Fighters to review and recommend approval/disapproval of
contractor CAPs and help prepare DNADs. All CAPs will be submitted to
the DCMA HQ POC identified below for processing.
- In general, the CAPs must identify the
noncompliant items and the date when compliance can be achieved.
Contractors should request DNADs in their CAPs when compliant specialty
metal of satisfactory quality and sufficient quantity, and in the required
form, can’t be procured as and when needed. There is no prescribed
format for a CAP since circumstances will vary, but DCMA’s Guidance
for Specialty Metal Corrective Action Plan Contents identifies the
information that will normally be required to perform an evaluation of the
CAP.
- To preclude rework, we’re advocating
early communication between the contractor and the U.S. Navy Price
Fighters (analogous to the IPT Pricing/Alpha Contracting approach used for
contract pricing), so please contact DCMA HQ once you learn a contractor
has decided to submit a “broad” CAP.
- OSD is working on guidance for DNAD
“reciprocity” (the conditions under which a DNAD granted by one Service
Secretary can be used by others within the Department of Defense).
DCMA is working on two DNAD requests that may be available for use
throughout the Department - one covers circuit card assemblies, the other
fasteners and small hardware. We estimate we will have a decision on
the circuit card assembly DNAD in December. The fastener and small
hardware DNAD request is currently being evaluated by the U.S. Navy Price
Fighters with an estimated completion date of mid-January. All DNADs
that have Department-wide applicability will be posted at http://www.dcma.mil/dnad.
- DCMA will engage with the Services and
Defense Agencies to discuss the possibility of a streamlined process for
waiver approvals and resolution of the withholds associated with
prior conditional acceptances.
- This information is applicable to the
Specialty Metals Clause
Compliance Interim Instruction.
Points of Contact
Signature:
Deputy Executive Director,
Contract Operations & Customer Relations