Author Archives: Henry Livingston

Thoughts Re New Regulations on Reporting of Nonconforming Items to the Government-Industry Data Exchange Program

DoD, GSA, and NASA recently issued a final rule amending the Federal Acquisition Regulation (FAR) to require contractors and subcontractors to report to the Government-Industry Data Exchange Program (GIDEP) certain counterfeit or suspect counterfeit parts and certain major or critical nonconformances. This FAR amendment also requires contractors and subcontractors to screen GIDEP reports to avoid the use and delivery of counterfeit or suspect counterfeit items or delivery of items that contain a major or critical nonconformance. After the review of public comments submitted in response to the proposed rule under FAR Case 2013-002, and after weighing the risks of failure against the cost of compliance, the final rule was “significantly descoped”.
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NASA Federal Acquisition Regulation Supplement: Detection and Avoidance of Counterfeit Parts

NASA is proposing to amend the NASA Federal Acquisition Regulation Supplement (NFS) to add new text that requires covered contractors and subcontractors at all tiers to use electronic parts that are currently in production and purchased from the original manufacturers of the parts, their authorized dealers, or suppliers who obtain such parts exclusively from the original manufacturers of the parts or their authorized dealers. If the contractor does not purchase electronic parts as described above, they must purchase the parts from a NASA identified supplier or contractor-approved supplier. The contractor will then assume responsibility and be required to inspect, test and validate authentication of the parts. The contractor will also be required to obtain traceability information and provide this information to the contracting officer upon request. The selection of contractor-approved
suppliers is subject to review and audit by the contracting officer.

More at FederalRegister.gov

ICE HSI arrests Chinese national in $23.8 million scheme to sell counterfeit laptop computer batteries on eBay and Amazon

“LOS ANGELES – A San Gabriel Valley man was arrested today on federal criminal charges that he participated in a $23.8 million scheme to manufacture and ship counterfeit laptop computer batteries and other electronics from China to the United States, where the bogus batteries were sold to unsuspecting buyers in online marketplaces. … ”

More at DHS.gov

Ghosts in the Clouds: Inside China’s Major Corporate Hack — WSJ

A Journal investigation finds the Cloud Hopper attack was much bigger than previously known

“In one of the largest-ever corporate espionage efforts, cyberattackers alleged to be working for China’s intelligence services stole volumes of intellectual property, security clearance details and other records from scores of companies over the past several years. … ”

More at WSJ.com

S.1790 – National Defense Authorization Act for Fiscal Year 2020

12/20/2019 – Signed by President; Became Public Law No: 116-92

Details at Congress.gov

 

FAR / DFARS CASE UPDATE (6 December 2019)

Status updates from the ‘Open Cases Reports’ …

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Update re: NDAA 2020 sections re counterfeit parts avoidance and trusted microelectronics

The Senate Bill for the National Defense Authorization Act for Fiscal Year 2020 (S.1790) modifies sections relevant to counterfeit parts avoidance and trusted microelectronics included in the House Bill. Here are the modified sections based on Conference report H.Rept.116-333 …

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FAR / DFARS CASE UPDATE (22 November 2019)

Status updates from the ‘Open Cases Reports’ …

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Federal Acquisition Regulation: Reporting of Nonconforming Items to the Government-Industry Data Exchange Program

Final rule. … DoD, GSA, and NASA are issuing a final rule amending the Federal Acquisition Regulation (FAR) to require contractors and subcontractors to report to the Government-Industry Data Exchange Program certain counterfeit or suspect counterfeit parts and certain major or critical nonconformances.

This final rule is available from the Federal Register

The following is a summary of significant changes from the proposed rule under FAR Case 2013-002 …

“The final rule is significantly descoped.

  • It does not apply to contracts and subcontracts for the acquisition of commercial items, including commercially available off-the-shelf (COTS) items.
  • Section 818(c)(4) of the NDAA for FY 2012 will not apply to contracts and subcontracts at or below the simplified acquisition threshold (SAT).

  • Rather than applying to all supplies, in addition to the requirements for section 818(c)(4) with regard to electronic parts for DoD, the rule focuses on supplies that require higher-level quality standards or are determined to be critical items (definition added).

  • The rule also exempts
    • medical devices that are subject to the Food and Drug Administration reporting requirements at 21 CFR 803;
    • foreign corporations or partnerships that do not have an office, place of business, or paying agent in the United States;
    • counterfeit, suspect counterfeit, or nonconforming items that are the subject of an on-going criminal investigation, unless the report is approved by the cognizant law- enforcement agency; and
    • nonconforming items (other than counterfeit or suspect counterfeit items) for which it can be confirmed that the organization where the defect was generated (e.g., original component manufacturer, original equipment manufacturer, aftermarket manufacturer, or distributor that alters item properties or configuration) has not released the item to more than one customer.

  • Flowdown to subcontracts is similarly descoped. The contractor is prohibited from altering the clause other than to identify the appropriate parties. …”