Government Contracts Rule Clarifies Exemption of Commercial Contracts from CAS
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Wednesday, August 1, 2018

Rule Clarifies Exemption of Commercial Contracts from CAS

By Government Contracts Editorial Staff

The Office of Federal Procurement Policy, Cost Accounting Standards Board, has issued a final rule amending the Cost Accounting Standards regulations at CAS 9903.201-1. The rule clarifies the types of contracts that are exempt from the application of CAS when acquiring commercial items. Since enactment of the Federal Acquisition Streamlining Act in 1994 (PL 103-355), the Federal Acquisition Regulation has included at FAR 12.207 an enumerated list of contract types authorized for use in acquiring commercial items. Inconsistencies have developed between the list of contract types recognized for the commercial items exemption in CAS 9903.201-1(b)(6) and the contract types reflected in FAR 12.207.

Inconsistencies Addressed. In its proposed rule, the CAS Board sought to address the inconsistencies between the lists in the (b)(6) exemption and FAR 12.207 by removing reference to specific contract types in paragraph (b)(6) and instead making a simple reference to “contracts and subcontracts for the acquisition of commercial items.” After a review of the public comments received in response to the proposed rule and further deliberation, the CAS Board concluded that the desired goal of clarification could be more effectively achieved by adding to CAS 9903.201-1 (b)(6) a cross reference toFAR 12.207 and incorporating its enumeration of contract types authorized for the acquisition of commercial items. This linkage will eliminate disparities between the FAR and CAS Board rules regarding the description of contract types authorized for commercial item acquisitions. The CAS Board also hopes that this change will avoid the need for additional CAS Board rulemakings in the event of future statutory actions addressing allowable contract types for commercial item procurements. For the text of this final rule, which goes into effect on August 16, 2018, see ¶70,055.28.

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