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FAR 2008Organization: National Aeronautics and Space Administration (NASA) Office of Procurement, Contract Management Division; and, NASA Quality Manager NASA Counterfeit Parts Working Group
Federal Acquisition Regulation (FAR) Case 2008-019 ************************************************** Comments:
NASA recommends that counterfeit product prevention/mitigation measures discussed in FAR Case 2008-019 be extended to apply to critical Electrical, Electronic, and Electromechanical (EEE) parts. “Critical” refers to parts that if non-conforming could result in hazardous or unsafe conditions for individuals using, maintaining, or depending upon the supplies; or would likely prevent performance of a vital agency mission (see FAR Part 46.101). This extension would apply to EEE parts procured directly by the Government and to EEE parts contained within higher level assemblies supplied to the Government.
It is NASA’s position that FAR instruction and clauses, such as those provided as examples below, could significantly reduce the risk of counterfeit parts being utilized in critical applications. NASA recognizes the need to preserve the competitive environment and to ensure that there is opportunity for all responsible suppliers to be able to compete for Government work. NASA believes that the FAR requirements could be crafted in such a way to adhere to these principles.
NASA recommends that the FAR specifically address acquisition strategies for EEE parts that could be used to mitigate the risk of obtaining counterfeit parts, such as:
The following are examples of possible FAR text applicable to critical EEE parts procurement that include recommended risk mitigation measures. The first example is in the form of requirement/instructional language to be included in Part 39 and/or Part 46; the second and third examples are in the form of provisions or clauses to be included in Part 52.
EEE Parts Procured as Discrete Units from Non-OEM
Authorized Distributors-
In all procurements for electrical, electronic, or electromechanical (EEE) parts that will be used in critical applications, the contracting agency shall (1) evaluate and identify the risks associated with obtaining counterfeit parts and (2) utilize an appropriate acquisition strategy to manage any identified risks. This strategy may include direct procurement of parts from the original equipment manufacturer (OEM) or authorized suppliers; Government-performed or approved tests and inspections; and/or evaluation criteria that include an assessment of each offeror’s ability and practices to ensure authenticity of parts, including clear representation and demonstration that parts are not counterfeit. A non-OEM authorized distributor’s ability to ensure authenticity of EEE parts is evidenced by rigorous purchasing procedures and product acceptance practices. Representation that parts are not counterfeit is fulfilled by the non-OEM authorized distributor by providing the contracting agency with a supplier certificate of conformance (COC). Demonstration by a non-OEM authorized distributor that parts are not counterfeit may be fulfilled by providing the contracting agency with a copy of one or more of the following: (1) records providing unbroken supply chain traceability to the OEM; and/or (2) test and inspection records demonstrating authenticity of the parts.
EEE Parts Procured as Discrete Units from Non-OEM Authorized Distributors- FAR Provision/Clause
The contractor represents and warrants that only new and authentic electrical, electronic, and electromechanical (EEE) parts are delivered to the Government under this contract and that the parts delivered are not counterfeit. The contractor shall demonstrate that EEE products are new and authentic by providing one or more of the following to the contracting officer: (1) the original equipment manufacturer (OEM)’s original certificate of conformance (COC), (2) records providing unbroken supply chain traceability to the OEM, and/or (3) test and inspection records demonstrating authenticity of the parts.
Procurement of Higher Level Assemblies Containing
Critical EEE Parts -
The contractor represents and warrants that only new and authentic electrical, electronic, and electromechanical (EEE) parts are used in products delivered to the Government under this contract and that the products delivered contain no counterfeit parts. The contractor shall evaluate the risk of obtaining counterfeit EEE parts and utilize an appropriate purchasing strategy to adequately manage that risk and thereby avoid obtaining counterfeit EEE parts. That strategy may include direct procurement of parts from original equipment manufacturers (OEM) s or authorized suppliers; tests and inspections to validate the authenticity of the parts; and/or an evaluation factor used in purchasing that confirms and demonstrates each non-authorized supplier's ability and practices to ensure authenticity of parts. The contractor’s ability to provide authentic parts is evidenced by rigorous purchasing and product acceptance practices. The contractor shall demonstrate that EEE products are new and authentic by providing one or more of the following to the contracting officer: (1) the OEM’s original certificate of conformance, (2) records providing unbroken supply chain traceability to the OEM, and/or (3) test and inspection records demonstrating authenticity of the parts. The contractor shall require non-authorized suppliers to represent and warrant that supplied parts are new and authentic.
The contractor shall require that its subcontractors and suppliers at any tier adhere to the requirements of this clause for the performance of this contract.
******************************************************* Original signed by: James Balinskas
Director, Contract Management Division, Office of Procurement National Aeronautics and Space Administration
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