Submission for OMB Review; Novation and Change-of-Name Agreements

AGENCY:

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

ACTION:

Notice.

SUMMARY:

Under the provisions of the Paperwork Reduction Act, the Regulatory Secretariat Division has submitted to the Office of Management and Budget (OMB) a request to review and approve an extension of a previously approved information collection requirement regarding novation and change-of-name agreements.

DATES:

Submit comments on or before August 5, 2024.

ADDRESSES:

Written comments and recommendations for this information collection should be sent within 30 days of publication of this notice to www.reginfo.gov/public/do/PRAMain. Find this particular information collection by selecting “Currently under Review—Open for Public Comments” or by using the search function.

FOR FURTHER INFORMATION CONTACT:

Zenaida Delgado, Procurement Analyst, at telephone 202-969-7207, or zenaida.delgado@gsa.gov.

SUPPLEMENTARY INFORMATION:

A. OMB Control Number, Title, and Any Associated Form(s)

9000-0076, Novation and Change-of-Name Agreements.

B. Need and Uses

This clearance covers the information that contractors must submit to comply with the following requirements in Federal Acquisition Regulation (FAR) subpart 42.12:

• FAR42.1203(a), Written Request. If a contractor wishes the Government to recognize a successor in interest to its contracts or a name change, the contractor must submit a written request to the responsible contracting officer. The request is used by the contracting officer to determine what additional supporting documentation should be submitted by the contractor and to determine what other contract administration offices should be notified of the contractor's request.
• FAR42.1204(e) and (f), Novation Agreement. Pursuant to FAR 42.1203(b)(1), upon request from the contracting officer, the contractor shall submit three signed copies of the proposed novation agreement, plus copies of the supporting documentation listed at 42.1204(e) and (f), as applicable. The documentation is used by the contracting officer to evaluate and, if appropriate, execute a proposed agreement for recognizing a third party as a successor in interest.
• FAR42.1205(a), Change-of-Name Agreement. Pursuant to FAR 42.1203(b)(1), upon request from the contracting officer, the contractor shall submit three signed copies of the proposed change-of-name agreement, plus copies of the supporting documentation listed at 42.1205(a), as applicable. The documentation is used by the contracting officer to evaluate and, if appropriate, execute a proposed agreement for recognizing a contractor's name change.

C. Annual Burden

Respondents: 1,625.

Total Annual Responses: 1,625.

Total Burden Hours: 3,163.

D. Public Comment

A. A 60-day notice was published in the Federal Register at 89 FR 24001, on April 5, 2024. A 60-day notice was published in the Federal Register at 89 FR 24001, on April 5, 2024. Comments from 3 respondents were received; however, they did not change the estimate of the burden.

Comment: Three respondents submitted the following recommendations for changes to the FAR:

• For novation agreements:

✓ Define time frames in which the government will review the novation request and request any further information.

✓ Explicitly permitting the electronic submission of novation packages.

✓ Reserve the novation process for only actual transfer of assets which are embodied in a sale between two entirely separate unaffiliated legal entities.

✓ Include recognition of a successor in interest to Government contracts among entities registered in the System for Award Management (SAM) that have a common parent company when there is no transfer of assets.

✓ Allow for a streamlined process for a transfer of assets between two affiliated entities within the same corporate parent structure.

✓ Remove the requirement to provide the “approximate remaining unpaid balance” of contracts to be novated at FAR 42.1204(e)(2)(iv).

✓ Clarify that a novation process can begin before all the documents are submitted although it won't be complete until all necessary requirements are fully satisfied.

✓ Remove the requirement for a corporate seal or require it only if the novated contracts are above a very high dollar threshold.

✓ Replace the listed documents at FAR 42.1204(f)(1) to (3) with a simple Secretary's Certificate, certifying that all the activities (registration, approval by the board, etc.) have been completed.

✓ Require the government to appropriately deem an acquirer as a successor in interest to the proposals. This could be a confirmation or certification in SAM that the resources proposed remain available to perform and that the acquisition or novation does not change the ability to perform.

✓ Require that the contracting officer managing the contract with the largest total contract value be the responsible contracting officer to execute the novation agreement including a review by the government's legal counsel.

✓ Limit the list requested at FAR 42.1204(e)(2) to multiple year contracts identified at the time of submission of the request.

✓ Review the list of documentation being requested in light of the advancement of electronic records.

• For change-of-name agreements:

✓ Run the change-of-name process through SAM exclusively. Deem the name change automatically effective on all existing contracts and work orders and all pending submitted proposals via SAM.

✓ Limit the list requested at FAR 42.1205(a)(3) to multiple year contracts identified at the time of submission of the request.

✓ Explicitly permitting the electronic submission of change-of-name packages.

Response: The respondents' input is appreciated. The recommendations made by the commenters may be considered for future action. Any necessary revisions to FAR subpart 42.12, Novation and Change-of-Name Agreements, will be accomplished through rulemaking.

Comment: In the process of updating a legal entity name in SAM, Defense Logistics Agency (DLA) Commercial and Government Entity (CAGE) Review requires a signed statement from a contracting officer before an update to a contractor's CAGE will be made. At the same time, the responsible contracting officer requests that SAM be updated before issuing a novation or name change. This apparently irreconcilable administrative conflict causes delay in updating SAM resulting in more awards being issued against the original contractor that would need a modification. This creates additional burden for both the contractor and the government.

Response: If a contractor is changing its name in SAM—

1. After completing the steps required by FAR 42.1205, the contractor would have to update/renew its entire Entity Registration in SAM and should be able to upload either the signed Change-of-Name Agreement or the signed SF30, Modification of Contract, satisfying what's required by the DLA CAGE team for screening and validation. See SAM's Knowledge Base articles #KB 0016829 and KB 0016831.

2. Before completing the steps required by FAR 42.1205, the contractor—

a. Must provide the notification required by paragraph (d) of the FAR clause at 52.204-13, System for Award Management Maintenance.

b. Would have to update/renew its entire Entity Registration in SAM.

c. When SAM sends the CAGE for screening and validation to the CAGE team, the team may request legal documentation to support the name change. This could result in the contractor getting a request from the DLA CAGE team for the same documentation needed to complete the steps required by FAR 42.1205. See SAM's Knowledge Base article #KB 0016831.

3. But the contractor does not have any open federal government contracts, then, the contractor would have to update/renew its entire Entity Registration in SAM. The contractor must provide the legal documentation needed to support the name change to the CAGE team to complete the CAGE/SAM validation process.

Obtaining Copies: Requesters may obtain a copy of the information collection documents from the GSA Regulatory Secretariat Division by calling 202-501-4755 or emailing GSARegSec@gsa.gov. Please cite OMB Control No. 9000-0076, Novation and Change-of-Name Agreements.