Public Law 111-347, effective on January 2, 2011, amends the Internal Revenue Code by imposition of tax on certain foreign procurements. Specifically, the law imposes on any foreign person that receives a specified Federal procurement payment a tax equal to 2 percent of the amount of such specified Federal procurement payment. The law stipulates that no funds are to be disbursed to any foreign contractor in order to reimburse the tax imposed. A currently proposed FAR amendment will implement this law.

In 2009, the Court of Federal Claims granted a contractor's motion for summary judgment in a segment closing case involving Cost Accounting Standard 413, concluding that the contractor had no remaining liability to the government following its transfer of pension asset surpluses to predecessor companies. [DIRECTV Group Inc. v. United States, Fed. Cl., No. 04-1414C, 10/14/09)]. In January 2012, the U.S. Court of Appeals for the Federal Circuit affirmed this decision. [The DIRECTV Group Inc. v. United States, Fed. Cir., No. 2010-5031, 1/26/12] (Attached below)

A final FAR revision has been issued to ensure contracting officers are aware of restrictions on the use of time-and-materials and labor-hour contracts for commercial services.

The rule implements Government Accountability Office recommendations for (1) ensuring that time-and-material and labor-hour contracts are used to acquire commercial services only when no other contract type is suitable and (2) instilling discipline in the determination of contract type with a view toward managing the risk to the government.

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The ASBCA has denied an appeal, finding that under a firm-fixed-price (FFP) contract, absent inclusion of an economic price adjustment (EPA) clause, the risk of material or labor cost fluctuation is on the contractor.  The contractor submitted a claim for reimbursement of increased costs beyond those estimated in its proposal due to high gasoline prices based on FAR 52.216-4 (economic adjustment clause).  

TAA Nonavailable & Exempt Items

25.104 Nonavailable articles (from https://www.acquisition.gov/far/current/html/Subpart 25_1.htm)

(a) The following articles have been determined to be nonavailable in accordance with 25.103