ML19261C391
| ML19261C391 | |
| Person / Time | |
|---|---|
| Issue date: | 01/30/1979 |
| From: | Donoghue D NRC OFFICE OF ADMINISTRATION (ADM) |
| To: | |
| Shared Package | |
| ML19261C376 | List: |
| References | |
| REF-10CFR9.7 SECY-79-075, SECY-79-75, NUDOCS 7903220374 | |
| Download: ML19261C391 (67) | |
Text
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UNITED STATES NUCLEAR REGULATORY COMMisslCN CONSENT CALEND b[EM For:
The Ccmissi ners
- rem:
Caniel J. Conognue, Direct:r Office of Acainistra:icn
/
k j 'd inru:
txecutive 01 rector for Operaticns
/
4
Subject:
FINAL RULE IMPLEMENTING CCPMISSICN PCLICY, PUS. L.
NO.95-209 AND THE ATCMIC ENERGY ACT OF 1954, AS AME'tCED BY PUB. L. NO.95-601 ON AVOICANCE OF CCNTRACTCR ORGANIEATICNAL CCNFLICTS OF INTEREST Purcose:
To obtain Ccmission approval of a final rule imolementing Ccmission a:: proved policy, Pub. L. No.95-209 and Pub. L. No. 95-c01 cn the avoidance of centrac.or organizaticnal conflicts of interest.
Catecory:
This paper covers a policy issue requiring Ccmissien consideration.
Discussicn:
Section 7 of Pub. L. No.95-209, the Nuclear Regulatory Ccenissicn (NRC) Autnori:ation Act for fiscal year 1978, recuired the NRC to prc=ulgate guidelines regarding organizational conflicts of interest. The Conference C:r:nittee stated in its report (H.R. Rep.95-738) :nat :ne NRC guicelines could be cdeled on -tese previcusly adcpted by Congress for the Feceral Energy Administration (FEA) and the Energy Researen and Cevelopment Administra:icn (ERDA).
r deral Cn January 22, 1973, tne NRC puolished in :ne e
Recister (23 Fed. Reg. 3238) ::rc;csec regulaticns n
- ne avoidance of ::ntractor Organi:sticnal c:nlicts of interest.
The precosed regulati:n incer; crated One substance of tne FEA and ERDA statutes cecrendec to NRC by Ccngress.
Interested perscns wen invited to su::mi: coments on the prepcsed regulattens until February 23, 1973.
In November,1973, Oub. L. Nc.95-601 added Secticn 17CA to =e A::mic Energy Act of 1954 requiring the NRC to promulgate a rule c:ncerninc c:nflicts of interest in accordance wita 5 U.S.C. $53. The lancuace of Secticn 17CA is sucstantially identicai to tha cf :ne ERCA and FEA statutes ucon wnich te NRC ;rt:csec rule was ::asec.
Centact:
M. Coleman, CC 227 4383 790322031'
2 No substantive changes in the proposed rule are required because of the enactment of Section 170A.
Since the public has already been afforded notice of and the opportunity for coment upon the proposed rule, the Comission for good cause finds that additional notice and public procedures thereon is unnecessary. Accordingly, the following regulations are adopted in final form pursuant to the authority of Section 170A of the Atomic Energy Act of 1954, as amended.
The following is a brief sumary of the major features of the rule. The rule sets forth two primary tests to be applied by NRC in its efforts to avoid contractor organizational conflicts of interest: (1) Might the contractor, if awarded the contract, be placed in a position where its judgment may be biased and (2)
Might the contractor receive an unfair competitive advantage based on the performance of the contract?
Solicitations for certain contracts will require offerors to represent whether the award of a contract would involve factual situations of the type set forth in the rule which may lead to conflicts of interest.
If so, an offeror must submit information regarding its relationships so that the contracting officer may decide upon an appropriate course of action.
If the contracting officcr determines that a conflict of interest exists, the contracting officer may disqualify the offeror, or include clauses in the contract designed to avoid the conflict.
A procedure for waiver of the policy is provided under narrowly defined circumstances when the work cannot be performed other than by a contractor involved in a conflict. A clause will be included in contracts requiring the contractor to refrain from other work which may give rise to a conflict and giving the NRC the power to terminate the contract if a conflict is discovered after award.
Attachment A contains all of the comments received as a result of the NRC Notice of proposed Rule Making. Attachment B includes a summary analysis of the Attachment A coments.
Attachment C is the Notice of Final Rule Making on Avoidance of Organizational Conflicts of Interest.
3 The significant changes which the staff proposes as a result of Public ccaments and staff review are as follows:
1.
The definition of the term " contract" has been revised to exclude application of the rule to interagency agreements. The Department of Energy (DOE) organizational conflict of interest '
rules implemented through NRC Bulletin 1102 afford NRC adequate protection with respect to work performed for NRC by National Laboratories.
Provisions directed at avoiding conflicts of interest will be included in interagency agreements with agencies other than DOE as' appropriate; 2.
A new provis. ion has been added to make it clear that the rule applies to contractor and offerors only.
It does not apply to individuals who have other relationships with NRC (e.g., parties to a licensing proceeding) or the acquisition of consulting services through the personnel -
appointment process.
3.
The final rule sets forth eight specific situations which have been divided into two categories. The first category contains s.ituations which may give rise to conflicts because of the contractors organizational relationships. The second category contains situations which may present conflicts because of the nature of the work; and 4.
The contract clause has been revised to bar contractors from participating in or performing the first comoetitively awarded procurement using specifications developed by the contractor.
This is designed to remove any motivation the contractor might have to develop a specification which is not suitable for competitive solicitation.
The proposed rule had contained a provision declaring the contractor permanently ineligible from participating in the award of a NRC contract under these circumstances.
Recommendation:
The Commission approve the final rule (Attachment C) for publication in the FEDERAL REGISTER.
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4 NOTE:
The House Committee on Interior and Insular Affairs, and the Senate Committee on Environment and Public Works will be notified.
-' Coordination:
This paper has been concurred in by the Offices of Nuclear Regulatory Research, Nuclear Reactor Regulation, Standards Development, Nuclear Material Safety and Safeguards, and the Office of the Executive Legal Director.
Scheduling:
For affirmation at an open meeting. Currently scheduled for Cd d
Daniel J. Donoghue, Director Office of Administration Attachments:
A.
Public Comments on Proposed Rule Re Avoidance of Contractor Organizational Conflicts of Interest B.
Summary of Comments and Responses on Attachment A C.
Notice of Final Rule Making on Avoidance of Organizational Conflicts of Interest Note:
Commission comments or consents should be provided directly to the Office of the Secretary by c.o.b. Monday, February 12, 1979.
Commission Staff Office comments, if any, should be submitted to the Commissioners NLT February 6, 1979, with an information copy to the Office of the Secretary.
If the paper is of such a nature that it requires additional time for analytical review and comment, the Commissioners and the Secretariat should be apprised of when comments may be exnected.
This paper is tentatively scheduled for affirmation at an Open Meeting during the Week of February 19, 1979.
Please refer to the appropriate Weekly Commission Schedule, when published, for a specific date and time.
DISTRIBUTION:
Commissioners Commission Staff Offices Exec. Dir. for Opers.
Regional Offices ACRS ASLBP ASLAP Secretariat
Attachment A PUBLIC COMMENTS ON PROPOSED RULE RE AVOIDANCE OF CONTRACTOR ORGANIZATIONAL CONFLICTS OF INTEREST e
e c
ATTACHMENT A
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