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Federal Acquisition Regulation; Federal Acquisition Circular 2020-06; Small Entity Compliance Guide

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Department of Defense (DoD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA).


Small Entity Compliance Guide.


This document is issued under the joint authority of DOD, GSA, and NASA. This Small Entity Compliance Guide has been prepared in accordance with section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996. It consists of a summary of the rules appearing in Federal Acquisition Circular (FAC) 2020-06, which amends the Federal Acquisition Regulation (FAR). An asterisk (*) next to a rule indicates that a regulatory flexibility analysis has been prepared. Interested parties may obtain further information regarding these rules by referring to FAC 2020-06, which precedes this document. These documents are also available via the internet at


May 6, 2020.


The FAC, including the SECG, is available via the internet at

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For clarification of content, contact the analyst whose name appears in the table below. Please cite FAC 2020-06 and the FAR Case number. For information pertaining to status or publication schedules, contact the Regulatory Secretariat Division at 202-501-4755.

Rule Listed in FAC 2020-06

ItemSubjectFAR CaseAnalyst
IRevocation of Executive Order on Nondisplacement of Qualified Workers2020-001Delgado.
* IIApplicability of Inflation Adjustments of Acquisition-Related Thresholds2018-007Delgado.
* IIITax on Certain Foreign Procurement2016-013Delgado.
IVTechnical Amendments
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Summaries for each FAR rule follow. For the actual revisions and/or amendments made by these FAR rules, refer to the specific item numbers and subjects set forth in the documents following these item summaries. FAC 2020-06 amends the FAR as follows:

Item I—Revocation of Executive Order on Nondisplacement of Qualified Workers (FAR Case 2020-001)

This final rule removes subpart 22.12, entitled “Nondisplacement of Qualified Workers Under Service Contracts”, and a related contract clause, from the FAR. The final rule applies to service contracts which succeed a contract for performance by service employees of the same or similar work at the same location. It removes a requirement for service contractors and their subcontractors to offer employees of the predecessor contractor and its subcontractors a right of first refusal of employment for positions for which they are qualified. It implements Executive Order 13897 of October 31, 2019, Improving Federal Contractor Operations by Revoking Executive Order 13495. This final rule will not have a significant impact on service contractors and their subcontractors. However, as a result of eliminating the language in FAR subpart 22.12, there will be fewer requirements imposed on contractors to keep records demonstrating compliance on successor contractors.

Item II—Applicability of Inflation Adjustments of Acquisition-Related Thresholds (FAR Case 2018-007)

This final rule makes inflation adjustments of statutory acquisition-related thresholds under 41 U.S.C. 1908 applicable to existing contracts and subcontracts in effect on the date of the adjustment. It implements section 821 of the National Defense Authorization Act for Fiscal Year 2018.

This final rule will not have a significant economic impact on a substantial number of small entities.

Item III—Tax on Certain Foreign Procurement (FAR Case 2016-013)

This final rule withholds a 2 percent tax on contract payments made by the United States (U.S.) Government to foreign persons pursuant to certain contracts. This rule applies to Federal Start Printed Page 27103Government contracts for goods or services that are awarded to foreign persons. It implements the Department of the Treasury final regulations published in the Federal Register at 81 FR 55133 on August 18, 2016, under section 5000C of the Internal Revenue Code relating to the 2 percent tax on payments made by the U.S. Government to foreign entities pursuant to certain contracts.

This final rule will not have a significant economic impact on a substantial number of small entities.

Item IV—Technical Amendments

Editorial changes are made at FAR 4.1102, 19.102, 25.301-1, 25.301-4, 52.219-28, 52.223-15, and 52.225-19.

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William F. Clark,

Director, Office of Government-wide Acquisition Policy, Office of Acquisition Policy, Office of Government-wide Policy.

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[FR Doc. 2020-07112 Filed 5-5-20; 8:45 am]