1. Home
  2. |Insights
  3. |DFARS Excessive Pass-Through Cost Rule Modified

DFARS Excessive Pass-Through Cost Rule Modified

Client Alert | 1 min read | 05.13.08

Effective May 13, 2008 (73 Fed. Reg. 27464), the widely-criticized interim DFARS rules about "excessive pass-through costs" published last April were modified in yet another interim rule to address the confusion created by the interim rules. The most important features of the new interim rules are in the prefatory comments, which emphasize repeatedly that the requirement for reporting when subcontract effort will exceed 70 percent applies both before and after award, but is only a reporting requirement, not a threshold for coverage, and that the rules do not apply to any contract, no matter what the subcontract content, where the contractor demonstrates "added value," a term that is defined in the interim regulations to include performance of "subcontract management functions that the Contracting Officer determines are a benefit to the Government (e.g., processing orders of parts or services, maintaining inventory, reducing delivery lead times, managing multiple sources for contract requirements, coordinating deliveries, performing quality assurance functions)."

Insights

Client Alert | 8 min read | 11.10.26

EU Simplifies Rules on Defense Procurement and Transfers of Defense-Related Products

The European Union has enacted its first major reform of the 2009 directives on defense procurement and intra-EU transfers of defense-related products. The amending directive, which has been adopted as part of the Defense Readiness Omnibus legislative package (also known as “Omnibus V”), aims to simplify and accelerate procedures both for buying defense- and security-related goods, and for transferring such goods between EU Member States.  ...