S 3203 ISCommentsClose CommentsPermalink

To prohibit the use of funds by the Department of Defense on the KC-X tanker contract, and for other purposes related to that contract.CommentsClose CommentsPermalink

June 26, 2008CommentsClose CommentsPermalink

Mr. ROBERTS (for himself and Mr. BROWNBACK) introduced the following bill; which was read twice and referred to the Committee on Armed ServicesCommentsClose CommentsPermalink

To prohibit the use of funds by the Department of Defense on the KC-X tanker contract, and for other purposes related to that contract.CommentsClose CommentsPermalink

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,CommentsClose CommentsPermalink

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) Short Title- This Act may be cited as the ‘KC-Tanker Recompete Act’.CommentsClose CommentsPermalink





(b) Table of Contents- The table of contents for this Act is as follows:CommentsClose CommentsPermalink





Sec. 1. Short title; table of contents.CommentsClose CommentsPermalink





Sec. 2. KC-X Tanker contract.CommentsClose CommentsPermalink





Sec. 3. Independent cost estimate.CommentsClose CommentsPermalink





Sec. 4. Requirement to offset illegal subsidization to foreign persons participating in KC-135 replacement competition.CommentsClose CommentsPermalink





Sec. 5. Ensuring fair competition.CommentsClose CommentsPermalink





Sec. 6. National security considerations.CommentsClose CommentsPermalink





Sec. 7. Industrial base considerations.CommentsClose CommentsPermalink





Sec. 8. Loss of employee tax revenue.CommentsClose CommentsPermalink





Sec. 9. Loss of corporate tax revenue.CommentsClose CommentsPermalink





Sec. 10. Regulatory burden.CommentsClose CommentsPermalink





Sec. 11. Foreign Corrupt Practices Act.CommentsClose CommentsPermalink





Sec. 12. Covered contractor definition.CommentsClose CommentsPermalink





Sec. 13. Report.CommentsClose CommentsPermalink

SEC. 2. KC-X TANKER CONTRACT.

(a) Prohibition- No funds may be used by the Department of Defense on the KC-X tanker contract. In this subsection, the term ‘KC-X tanker contract’ means the contract awarded by the Department of the Air Force on February 29, 2008, for the next generation air-refueling tanker aircraft.CommentsClose CommentsPermalink





(b) Replacement- If the Department of the Air Force chooses not to exercise its authority to award a new contract for the KC-X tanker to the bidder whose protest of the February 29, 2008, award was sustained by the Government Accountability Office on June 18, 2008, the Secretary of Defense, using competitive procedures, shall award a contract for a replacement for the KC-135 tanker. Such funds as may be necessary are authorized to conduct the competition for such contract.CommentsClose CommentsPermalink

SEC. 3. INDEPENDENT COST ESTIMATE.

As part of the acquisition process for the award of a contract for a replacement for the KC-135 tanker, as required by section 2(b), the Secretary of Defense and the source selection authority shall ensure that an independent cost estimate is completed. The cost estimate shall include an estimate of--CommentsClose CommentsPermalink





(1) all costs borne by the suppliers;CommentsClose CommentsPermalink





(2) all costs borne by foreign governments;CommentsClose CommentsPermalink





(3) all costs borne by domestic suppliers (if the proposal involves any domestic suppliers); andCommentsClose CommentsPermalink





(4) all costs covered by cost accounting standards under the Federal Acquisition Regulation.CommentsClose CommentsPermalink

SEC. 4. REQUIREMENT TO OFFSET ILLEGAL SUBSIDIZATION TO FOREIGN PERSONS PARTICIPATING IN KC-135 REPLACEMENT COMPETITION.

(a) Requirement- As part of the acquisition process for the award of a contract for a replacement of the KC-135 tanker, as required by section 2(b), the Secretary of Defense shall, in conducting the cost or price evaluation of any proposal submitted by a subsidized person, increase the cost or price of the proposal by the amount of illegal subsidization.CommentsClose CommentsPermalink





(b) Illegal Subsidization- For purposes of subsection (a), the amount of illegal subsidization with respect to a proposal submitted by a subsidized person is the amount of the illegal subsidy referred to in subsection (c), as determined jointly by the Secretary of Commerce and the United States Trade Representative after receipt of a request from the Secretary of Defense for such a determination.CommentsClose CommentsPermalink





(c) Subsidized Persons- With respect to any proposal submitted to the Department of Defense for a contract for a replacement of the KC-135 tanker, a subsidized person is any of the following:CommentsClose CommentsPermalink





(1) FOREIGN PERSON- A foreign person to which the government of a foreign country that is a member of the World Trade Organization has provided a subsidy for the tanker if--CommentsClose CommentsPermalink





(A) the United States has requested consultations with that foreign country under the Agreement on Subsidies and Countervailing Measures on the basis that the subsidy is an illegal subsidy under that Agreement; andCommentsClose CommentsPermalink





(B) the World Trade Organization has ruled that the subsidy provided by the foreign country is an illegal subsidy under the Agreement on Subsidies and Countervailing Measures.CommentsClose CommentsPermalink





(2) JOINT VENTURES- Any joint venture, cooperative organization, partnership, or contracting team of which a foreign person described in paragraph (1) is a member.CommentsClose CommentsPermalink





(3) SUBCONTRACTS- Any person proposing to use a foreign person described in paragraph (1) or an entity described in paragraph (2) as a subcontractor in performing the contract for which the proposal is submitted.CommentsClose CommentsPermalink





(d) Definitions- In this section:CommentsClose CommentsPermalink





(1) The term ‘Agreement on Subsidies and Countervailing Measures’ means the agreement described in section 101(d)(12) of the Uruguay Round Agreements Act (19 U.S.C. 3501(d)(12)).CommentsClose CommentsPermalink





(2) The term ‘illegal subsidy’ means a prohibited subsidy or an actionable subsidy under the Agreement on Subsidies and Countervailing Measures.CommentsClose CommentsPermalink





(3) The term ‘foreign person’ means--CommentsClose CommentsPermalink





(A) an individual who is not a United States person or an alien lawfully admitted for permanent residence into the United States; orCommentsClose CommentsPermalink





(B) a corporation, partnership, or other nongovernmental entity which is not a United States person.CommentsClose CommentsPermalink





(4) The term ‘United States person’ means--CommentsClose CommentsPermalink





(A) a natural person who is a citizen of the United States or who owes permanent allegiance to the United States; andCommentsClose CommentsPermalink





(B) a corporation or other legal entity which is organized under the laws of the United States, any State or territory thereof, or the District of Columbia, if natural persons described in subparagraph (A) own, directly or indirectly, more than 50 percent of the outstanding capital stock or other beneficial interest in such legal entity.CommentsClose CommentsPermalink





(5) The term ‘cost or price evaluation’ means an evaluation conducted by a source selection authority pursuant to subpart 15.305(a)(1) of the Federal Acquisition Regulation.CommentsClose CommentsPermalink

SEC. 5. ENSURING FAIR COMPETITION.

As part of the acquisition process for the award of a contract for a replacement for the KC-135 tanker, as required by section 2(b), the Secretary of Defense and the source selection authority shall ensure that any covered contractor, foreign or domestic, for the contract, as part of the cost criteria, is evaluated both on the cost borne by the supplier and any cost borne by a foreign government that is not borne by a government (local, State, or Federal) in the United States. The costs considered in the evaluation shall be consistent with the costs estimated in the independent cost estimate completed pursuant to section 3.CommentsClose CommentsPermalink

SEC. 6. NATIONAL SECURITY CONSIDERATIONS.

As part of the acquisition process for the award of a contract for a replacement for the KC-135 tanker, as required by section 2(b), it is the responsibility of the Department of Defense to take into consideration the national security impacts, the industrial base impacts, and the economic impact to the United States of awarding contracts for critical capabilities to foreign entities.CommentsClose CommentsPermalink

SEC. 7. INDUSTRIAL BASE CONSIDERATIONS.

As part of the acquisition process for the award of a contract for a replacement for the KC-135 tanker, as required by section 2(b), it is the responsibility of the Department of Defense to take into consideration the industrial base impacts and the economic impact to the United States of awarding contracts involving critical jobs to foreign entities.CommentsClose CommentsPermalink

SEC. 8. LOSS OF EMPLOYEE TAX REVENUE.

As part of the acquisition process for the award of a contract for a replacement for the KC-135 tanker, as required by section 2(b), it is the responsibility of the Department of Defense to take into consideration the impact of lost personal income tax revenues to the United States, as a result of awarding defense contracts to foreign entities.CommentsClose CommentsPermalink

SEC. 9. LOSS OF CORPORATE TAX REVENUE.

As part of the acquisition process for the award of a contract for a replacement for the KC-135 tanker, as required by section 2(b), it is the responsibility of the Department of Defense to take into consideration the impact of lost corporate tax revenues to the United States, as a result of awarding defense contracts to foreign entities.CommentsClose CommentsPermalink

SEC. 10. REGULATORY BURDEN.

As part of the acquisition process for the award of a contract for a replacement for the KC-135 tanker, as required by section 2(b), it is the responsibility of the Department of Defense to take into consideration the impact of all regulations waived or that are not applicable with respect to foreign entities. These regulations include cost accounting standards, Buy America provisions, specialty metal provisions, the Foreign Corrupt Practices Acts, and compliance with the International Traffic in Arms Regulation.CommentsClose CommentsPermalink

SEC. 11. FOREIGN CORRUPT PRACTICES ACT.

(a) Condition for Prospective Award of Contract-CommentsClose CommentsPermalink





(1) IN GENERAL- As part of the acquisition process for the award of a contract for a replacement for the KC-135 tanker, as required by section 2(b), the Secretary of Defense and the source selection authority shall require that any contractor or subcontractor described in paragraph (2) that is not already covered by the Foreign Corrupt Practices Act shall be required, as a condition of the contract, to comply with the requirements of such Act.CommentsClose CommentsPermalink





(2) CONTRACTOR AND SUBCONTRACTORS DESCRIBED- A contractor or subcontractor described in this paragraph is any of the following:CommentsClose CommentsPermalink





(A) A prospective defense contractor that is part of an internationally controlled group of entities.CommentsClose CommentsPermalink





(B) A prospective subcontractor that is part of an internationally controlled group of entities, provided that the subcontractor is at the second tier or higher and is to be used by the prospective defense contractor (as described in subparagraph (A)) to perform the contract.CommentsClose CommentsPermalink





(b) Compliance Program-CommentsClose CommentsPermalink





(1) IN GENERAL- With respect to compliance with the Foreign Corrupt Practices Act, the Secretary of Defense shall require that all contractors and subcontractors described in subsection (a)(2) have a compliance program and certify in writing that they have completed an audit of that compliance program.CommentsClose CommentsPermalink





(2) DEBARMENT-CommentsClose CommentsPermalink





(A) IN GENERAL- Any contractor described in subsection (a)(2) that engages in conduct that violates the requirements of the Foreign Corrupt Practices Act or any similar applicable laws in foreign countries shall be debarred from contracting with the Department of Defense.CommentsClose CommentsPermalink





(B) PERIOD OF DEBARMENT- The period of debarment under subparagraph (A) shall be at least 3 years.CommentsClose CommentsPermalink





(c) National Security Waiver Authority-CommentsClose CommentsPermalink





(1) IN GENERAL- The Secretary of Defense may waive the applicability of subsections (a) and (b) in specific instances if the Secretary determines that the waiver is necessary in the national security interests of the United States.CommentsClose CommentsPermalink





(2) NON-DELEGATION- The Secretary of Defense may not delegate the waiver authority under paragraph (1).CommentsClose CommentsPermalink





(3) NOTIFICATION- Upon issuing a waiver under paragraph (1), the Secretary of Defense shall notify the appropriate Congressional committees in writing not later than 30 days after issuing such waiver.CommentsClose CommentsPermalink





(d) Definitions- In this section:CommentsClose CommentsPermalink





(1) FOREIGN CORRUPT PRACTICES ACT- The term ‘Foreign Corrupt Practices Act’ means--CommentsClose CommentsPermalink





(A) section 30A of the Securities Exchange Act of 1934 (15 U.S.C. 78dd-1); andCommentsClose CommentsPermalink





(B) sections 104 and 104A of the Foreign Corrupt Practices Act of 1977 (15 U.S.C. 78dd-2).CommentsClose CommentsPermalink





(2) INTERNATIONALLY CONTROLLED GROUP OF ENTITIES- The term ‘internationally controlled group of entities’ means a controlled group of entities the common parent of which is a company organized under the laws of a foreign government and to which the Foreign Corrupt Practices Act does not, by its jurisdictional terms, apply.CommentsClose CommentsPermalink





(3) APPROPRIATE CONGRESSIONAL COMMITTEES- In this subsection, the term ‘appropriate congressional committees’ means--CommentsClose CommentsPermalink





(A) the Committee on Armed Services, the Committee on Appropriations, and the Permanent Select Committee on Intelligence of the House of Representatives; andCommentsClose CommentsPermalink





(B) the Committee on Armed Services, the Committee on Appropriations, and the Select Committee on Intelligence of the Senate.CommentsClose CommentsPermalink

SEC. 12. COVERED CONTRACTOR DEFINITION.

In this Act, the term ‘covered contractor’, with respect to a prime contract of the Department of Defense, means any of the following:CommentsClose CommentsPermalink





(1) CONTRACTOR AND SUBSIDIARIES AND AFFILIATES-CommentsClose CommentsPermalink





(A) Any prospective contractor making an offer for the contract.CommentsClose CommentsPermalink





(B) The contractor awarded the contract.CommentsClose CommentsPermalink





(C) Any subsidiary or affiliate of the contractor awarded the contract.CommentsClose CommentsPermalink





(2) SUBCONTRACTORS AND SUBSIDIARIES AND AFFILIATES-CommentsClose CommentsPermalink





(A) Any subcontractor of a contractor described in paragraph (1)(B) that is at the second tier or higher and is to be used by the contractor in the performance of the contract.CommentsClose CommentsPermalink





(B) Any subsidiary or affiliate of any such subcontractor.CommentsClose CommentsPermalink

SEC. 13. REPORT.

(a) Report Requirement- The Secretary of Defense shall submit to the congressional defense committees a report on compliance by the Department of Defense with the provisions of this Act during the acquisition process for the award of a contract for a replacement for the KC-135 tanker, as required by section 2(b).CommentsClose CommentsPermalink





(b) Deadline- The report shall be submitted no later than the date of award of such contract.CommentsClose CommentsPermalink





(c) Congressional Defense Committees- In this section, the term ‘congressional defense committees’ means--CommentsClose CommentsPermalink





(1) the Committee on Armed Services and the Committee on Appropriations of the Senate; andCommentsClose CommentsPermalink





(2) the Committee on Armed Services and the Committee on Appropriations of the House of Representatives.CommentsClose CommentsPermalink