Appendix A to Part 1138 - Terms and Conditions for SUB Article I, “Distinguishing Subawards and Procurements”
2:1.2.8.6.18.12.64.3.56 : Appendix A
Appendix A to Part 1138 - Terms and Conditions for SUB Article I,
“Distinguishing Subawards and Procurements”
Unless modified as provided in § 1138.5, a DoD Component's
general terms and conditions must use the following wording for SUB
Article I.
SUB Article I. Distinguishing Subawards and Procurements. (DECEMBER
2014)
Section A. Required recipient determination. For each
transaction into which you enter with another entity at the next
tier below this award, you must determine whether the transaction
is a subaward or a procurement.
Section B. Considerations in making the
determination.
1. The primary purpose of the transaction between you and the
other entity is the key factor you must use to determine whether
the transaction is a subaward or a procurement.
a. The transaction is a subaward and the other entity therefore
a subrecipient if the transaction's primary purpose is for you to
transfer - for performance by the other entity - a portion of the
substantive program for which we are providing financial assistance
to you through this award. You will continue to be accountable to
us for performance of the project or program under the award,
including portions performed by any subrecipients.
b. The transaction is a procurement and the other entity
therefore your contractor if the transaction's primary purpose is
for you to purchase goods or services that you need to perform the
substantive program supported by this award. The distinction from a
subaward is the contractor is not performing a portion of the
substantive program as a result of the transaction.
2. What you call the transaction is not a factor in
distinguishing a subaward from a procurement. If the transaction
meets the criterion in paragraph B.1.a of this article, it is a
subaward for purposes of the requirements of this award even if you
call and consider the transaction a “contract.”
Section C. Effect of the determination on the next-tier
transaction.
1. Process for awarding the transaction. One important
consequence of your determining whether a next-tier transaction is
a subaward or a procurement is that there are different
requirements governing the pre-award and time of award processes
that you use to award the transaction.
a. SUB Article II of this award specifies pre-award and time of
award responsibilities for subawards.
b. PROC Articles I and II of this award govern pre-award and
time of award processes for awarding procurement transactions.
2. Transaction terms and conditions. A second important
consequence of your determining whether a next-tier transaction is
a subaward or a procurement is that the terms and conditions you
include in a subaward differ from those you include in a
procurement transaction.
a. Section C of SUB Article II of this award addresses
requirements you must include in subaward terms and conditions.
Those requirements generally are either identical or directly
related to requirements in the general terms and conditions of this
award. They include national policy requirements as well as
administrative requirements in areas such as financial and
programmatic management, property administration, procurement, and
reporting.
b. PROC Article III of this award lists requirements you must
include in a procurement transaction when applicable to the
procurement.