Markup of H.R. 1960 (NDAA for FY2014) Includes Exemption From Strict Counterfeit Parts Financial Liability Associated with Obsolescence Issues

En Bloc Amendments to H.R. 1960, National Defense Authorization Act for Fiscal Year 2014 (Wednesday, June 5, 2013)

Log #: 002r1
Sponsor: Bridenstine
Description: Expands conditions under which covered contractors can qualify for exemption from strict financial liability associated with rework and corrective action of counterfeit or suspected counterfeit electronic parts including identified obsolete parts in certain circumstances.

The proposal establishes three criteria to provide a safe harbor from liability when using obsolete parts:

1. A contractor would need to identify obsolete parts necessary to meet requirements contained in a DOD contract solicitation and provide a plan to ensure trusted suppliers for those parts or offer design modifications as part of their proposal;

2. The government, in response to these options, would elect not to fund them and instead proceed with the original requirements to include the obsolete parts;

3. The contractor would apply inspections and tests to detect counterfeits when buying from other than the original equipment manufacturer or their authorized dealers.

If all three criteria can be demonstrated by the contractor, then the contractor would be able to submit the remedy costs of a counterfeit part as an allowable expense.

See “Full Committee En Bloc Package #1” added 06/06/2013 at 01:39 PM

For rationale associated with this proposal, my earlier essay.

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2 thoughts on “Markup of H.R. 1960 (NDAA for FY2014) Includes Exemption From Strict Counterfeit Parts Financial Liability Associated with Obsolescence Issues

  1. Anonymous says:

    Henry, Thanks for sharing that. It is definitely a step in the right direction when there is simply no other choice for obsolete parts. What is the latest status on this?

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