48 C.F.R. § 52.215-22

52.215-22 Limitations on Pass-Through Charges—Identification of Subcontract Effort.

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As prescribed in 15.408(n)(1), use the following provision:

Limitations on Pass-Through Charges—Identification of Subcontract Effort (OCT 2009)

(a) Definitions. Added value, excessive pass-through charge, subcontract, and subcontractor, as used in this provision, are defined in the clause of this solicitation entitled “Limitations on Pass-Through Charges” (FAR 52.215-23).

(b) General. The offeror's proposal shall exclude excessive pass-through charges.

(c) Performance of work by the Contractor or a subcontractor. (1) The offeror shall identify in its proposal the total cost of the work to be performed by the offeror, and the total cost of the work to be performed by each subcontractor, under the contract, task order, or delivery order.

(2) If the offeror intends to subcontract more than 70 percent of the total cost of work to be performed under the contract, task order, or delivery order, the offeror shall identify in its proposal—

(i) The amount of the offeror's indirect costs and profit/fee applicable to the work to be performed by the subcontractor(s); and

(ii) A description of the added value provided by the offeror as related to the work to be performed by the subcontractor(s).

(3) If any subcontractor proposed under the contract, task order, or delivery order intends to subcontract to a lower-tier subcontractor more than 70 percent of the total cost of work to be performed under its subcontract, the offeror shall identify in its proposal—

(i) The amount of the subcontractor's indirect costs and profit/fee applicable to the work to be performed by the lower-tier subcontractor(s); and

(ii) A description of the added value provided by the subcontractor as related to the work to be performed by the lower-tier subcontractor(s).

(End of provision) [74 FR 52855, Oct. 14, 2009]
Notes of Decisions
Cited in 6 cases, 1992–2016 · leading case: Sundstrand Corp. v. Comm'r, 98 T.C. 518 (Tax Ct. 1992).
Sundstrand Corp. v. Comm'r, 98 T.C. 518 (Tax Ct. 1992). · cites it 2× “6621(a)(2) ; and (2) For Department of Defense contracts only, a penalty equal to the amount of the overpayment, if the Contractor or subcontractor knowingly submitted cost or pricing data which were incomplete, inaccurate, or noncurrent.”
X Corp. v. Doe, 816 F. Supp. 1086 (E.D. Va. 1993). · cites it 2× “48 C.F.R. § 52.215-22 . 14 This FAR, in effect, requires X Corp.”
United States Ex Rel. Keaveney v. SRA Int'l, Inc., 219 F. Supp. 3d 129 (D.D.C. 2016). “215-22 ( 48 C.F.R. § 52.215-22 ) and FAR 52.215-23.”
Best Foam Fabricators, Inc. v. United States, 38 Fed. Cl. 627 (Fed. Cl. 1997). “However, nothing in this clause or applicable regulations authorizes the government to suspend performance or repudiate its contractual obligations based on its suspicion that the contractor engaged in defective pricing.”
Aerojet Solid Propulsion Co. v. Thomas E. White, Sec'y of the Army, 291 F.3d 1328 (Fed. Cir. 2002). “Aerojet’s nitroplasticizer contract incorporated a term from 48 C.F.R. § 52.215-22 (1988) that allowed the United States to reduce the contract price if Aerojet had “furnished cost or pricing data that were not complete, accurate, and current as certified.”
Telex Commc'ns, Inc. v. United States, 40 Fed. Cl. 703 (Fed. Cl. 1998). “215-22, 48 C.F.R. § 52.215-22 (1996), was inapplicable; 2) fair and open negotiations produced binding contractual obligations upon the LOC regarding agreed-to prices; and 3) plaintiff should have an opportunity to claim an equitable adjustment if the contracts are subject to…”
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