Additional definitions used shall not be inconsistent with the provisions of this subchapter.

§ 597.103-2 Changes.

When reasonable and practicable under the circumstances of a particular procurement, the contracting officer may substitute in the Changes clause a period longer or shorter than "30 days."

§ 597.103-5 Inspection.

(a) Specifications which do not contain complete and definite quality assurance provisions shall be supplemented to the extent necessary to define clearly the inspections required to be performed by the contractor.

(b) Solicitations shall contain reasonably definitive descriptions of the inspection system to be maintained by the contractor when it will be necessary for the contractor to establish an inspection system pursuant to subparagraph (e) of the Inspection clause (§ 7.103-5 of this title) which

(1) Is likely to represent a departure from customary industry procedures;

(2) Is of a nature not normally found among the prospective contractors who may be expected to participate in the procurement; or

(3) May reasonably be expected to have a significant impact on the cost or other aspect of the procurement.

§ 597.103-8 Assignment of claims.

(a) A head of procuring activity may authorize deletion of the last sentence of subparagraph (a) of the Assignment of Claims clause in conformance with 7.103-8 of this title.

(b) Reduction of or setoff from payments to be made to an assignee shall be effected in accordance with §§ 163.108-7 and 163.108-8 of this title as appropriate.

(c) In a case where a contracting officer believes that an assignee has received payments in excess of its beneficial interest and that a refund is to the advantage of the Government, the contracting officer may, after obtaining legal advice and approval at a level above the

contracting officer, seek to have the assignee release moneys in excess of such beneficial interest.

(d) A contracting officer shall acknowledge notices of assignment filed by assignees. Where a notice of assignment of moneys due under a definitive contract, which supersedes a letter contract, is received pursuant to the Assignment of Claims Act of 1940, as amended, such notice shall be acknowledged regardless of the fact that a notice of assignment of moneys due under the letter contract had been previously acknowledged. The two notices of assignment shall be considered as one and filed accordingly.

(e) Where direct payment is made to an assignee, the contractor shall furnish on each voucher, invoice, or other supporting document, a statement to the effect that he recognizes the assignment, its validity and the right of the assignee to receive payment.

(1) A contracting officer shall, upon request of a contractor, furnish proposed assignees information regarding the status of the contract at the time of the assignment. The contracting officer shall advise the assignee that the information is furnished only for privileged purposes restricted to use in connection with the assignment.

(a) The head of procuring activity, U.S. Army, Europe, may modify the Disputes clause in § 7.103-12 of this title to read as set forth below: Provided, however, That the Commander in Chief, U.S. Army, Europe, may reserve to his headquarters the legal functions relating to appeals from disputes and to litigation arising from such contracts which are executed by purchasing officers in Europe and may take the action of the head of procuring activity in paragraphs (c). (d), and (e) of this section.

sentative (other than the Contracting Ofcer under this contract) for the determination of such appeals shall be final and conclusive if the amount involved in the appeal is $50,000 or less. If the amount involved exceeds $50,000 such decision shall be final and conclusive unless, within 30 days after receipt by the Contractor thereof, the Contractor furnishes to the Contracting Officer a written appeal addressed to the Secretary. The decision of the Secretary or his duly authorized representative for the determination of such appeals, or of the ----------[*]-------in the case of appeals involving amounts of $50,000 or less, shall be final and conclusive [1. unless determined by a court of competent jurisdiction to have been fraudulent, or capricious, or arbitrary, or so grossly erroneous as necessarily to imply bad faith, or not supported by substantial evidence.] [2. to the extent permitted by U.S. law.] In connection with any appeal proceeding under this clause, the contractor shall be afforded an opportunity to be heard and to offer evidence in support of his appeal. Pending final decision of a dispute hereunder, the Contractor shall proceed diligently with the performance of the contract and in accordance with the Contracting Omcer's decision.

(b) This "Disputes" clause does not preclude consideration of law questions in connection with decisions provided for in paragraph (a) above: Provided, That nothing, in this contract shall be construed as making final the decision of any administrative oficial, representative, or board on a question of law.

(b) In the above clause-
(1) The space indicated

[*] "" shall be completed to state the proper title of the head of procuring activity (or the Commander in Chief, U.S. Army, Europe, if he so elects) pursuant to paragraph (a) of this section who has established the U.S. Army Board of Contract Appeals, Europe, in accordance with paragraph (c) of this section;

(2) The bracketed language numbered .[1]__. in the clause shall be used in all contracts except those in which it is anticipated that the contractor will be a foreign entity, and

(3) The bracketed language numbered

in

the clause shall be used in all contracts in which it is anticipated that the contractor will be a foreign entity.

(c) The head of procuring activity. U.S. Army, Europe (or the Commander in Chief, U.S. Army, Europe, if he so elects) shall appoint a board to be known as "The U.S. Army Board of Contract Appeals, Europe." The Board shall consist of three or more members who shall

be persons trained in the law, one of whom shall be designated by the appointing authority as President of the Board. There shall also be appointed a Recorder of the Board who shall perform such duties as the Board may pre scribe, and who may also be a member of the Board. The Board shall be designated by the appointing authority as his authorized representative to hear, consider, and decide as fully as the appointing authority himself might do, all appeals under contracts providing for such appeals. The Board shall be granted all powers necessary and incident to the proper performance of its duties and, with the approval of the appointing authority, shall adopt and promulgate its own methods of procedure, rules, and regulations for its conduct and for the preparation and presentation of appeals and the issuance of its decisions. The appointing authority shall also designate one or more trial attorneys, who shall be qualified attorneys at law, for the preparation and presentation of the contentions of the Government in relation to appeals before the Board.

(d) The appointing authority shall issue instructions for processing appeals to the U.S. Army Board of Contract Appeals, Europe. An appeal to the Secretary taken from the decision of the Board shall be processed in accordance with paragraph (e) of this section.

(e) Upon receipt of a notice of appeal from the decision of the U.S. Army Board of Contract Appeals, Europe, or of advice that an appeal has been filed, the contracting officer shall immediately transmit to the appointing authority such notice or advice. Thereupon the appointing authority shall perform the duties of the contracting officer as set* forth in Rule 4, § 30.1 of this title and § 616.1 of this chapter. Signed statements or summaries of expected testimony are not required with the comprehensive report when the substance of expected testimony is set forth in the transcript of proceedings.

erty shall contain the following modification of the clause in § 7.103-20 of this title

COVENANT AGAINST CONTINGENT FEES
(FEBRUARY 1965)

The Contractor warrants that no person or selling agency has been employed or retained to solicit or secure this contract upon an agreement or understanding for commission, percentage, brokerage, or contingent fee, excepting bona fide employees or bona fide established commercial or selling agencies maintained by the Contractor for the purpose of securing business. For breach or violation of this warranty the Government shall have the right to annul this contract without liability or in its discretion to require the Contractor to pay, in addition to the contract price or consideration, the full amount of such commission, percentage, brokerage, or contingent fee.

§ 597.105 Additional clauses.

The clauses set forth in § 7.105 of this title may be used in accordance with instructions therein when it is desired to cover the subject matter thereof in contracts.

[36 F.R. 20682, Oct. 28, 1971]

§ 597.107 Price escalation clause (labor and material).

(a) The clause set forth in § 7.107(c) of this title shall not be used where it is desired to adjust contract prices upon the basis of quantitative changes in the original estimates of labor hours or materials. When the criteria in § 7.107(a) of this title are met, the clause may be used in the procurement of items other than those of a standard commercial nature where adequate cost experience has been obtained on previous contracts and where the design of the supplies has been stabilized.

(b) Considerable latitude is permitted and encouraged in the selection of types of labor and material and rates of pay or price per unit to be negotiated under § 7.107(b) of this title. Wherever possible and practicable, costs selected for escalation should be reduced to a type of material price or rate of pay agreement that will require little if any audit review if a price adjustment is called for by either of the contracting parties. § 597.150

Department of the Army

clauses. The following clauses shall be used in fixed-price supply contracts in accordance with instructions given.

§ 597.150-1 Plant protection.

In those cases where another military department or agency does not have plant cognizance and the contracting officer deems it necessary to retain some control as to the plant protective devices in a particular plant, the contract shall contain one of the following clauses

(a) PLANT PROTECTION (FEBRUARY 1965)

The Contractor shall maintain in and about his plant adequate plant protective devices and shall employ such watchmen, guards, and other personnel as the Contracting Officer may deem necessary to prevent espionage, sabotage, and other malicious destruction or damage.

(b) PLANT PROTECTION (FEBRUARY 1965)

(1) The Contract shall maintain in and about his plant adequate plant protective devices and shall employ such watchmen, guards, and other personnel as the Contracting Officer may deem necessary to prevent espionage, sabotage, and other malicious destruction or damage. If after commencement of performance of this contract, the Contracting Officer shall require and authorize in writing the installation of additional plant protective devices or the employment of additional watchmen, guarda, or other personnel, the cost of any such devices installed or the pay of any such personnel employed, or both shall be reimbursed to the Contractor upon submission of vouchers approved by the Contracting Officer: Provided, That no reimbursement for any such installation or pay shall be made in excess of the cost thereof, as estimated in advance and approved in writing by the Contracting Officer.*

(2) Title to all plant protective devices and equipment installed under paragraph (1) of this clause shall be in the Government, and shall not be affected by incorporation or attachment of such devices and equipment to any property not owned by the Government, nor shall any such device or equipment become a fixture or lose its identity as personality by reason of affixation to any realty. After completion or termination of the contract, the Government may, (1) allow the contractor to acquire any such devices and equipment under the conditions prescribed by and at a price or prices approved by the Contracting Officer, (11) require the Contractor to comply, at Government expense, with directions of the Contracting Officer with respect to removal and shipment

*If desired an additional proviso may be added, reading substantially as follows:

Provided further that no reimbursement of the cost of any such installation or pay of any such personnel is being made to the Contractor by other means.

of such devices and equipment, or (111) abandon all such devices and equipment in place, and thereupon all obligations of the Government regarding such abandoned devices and equipment shall cease.

(c) PLANT PROTECTION (GOVERNMENT-OWNED CONTRACTOR-OPERATED PLANTS) (SEPTEMBER

1970)

(1) Subsequent to the execution of this contract, and within 45 calendar days from the date thereof, the Contractor shall submit to the Contracting Officer a written plant protection plan with a proposed security staffing pattern. The Contractor shall use the Army Materiel Command Regulation No. 190-3, March 1968, Preservation of Order Activities, as a guide in the Preparation of the plant protection plan.

In his endeavor to maintain an adequate degree of plant protection and physical security, the Contractor shall cooperate with the Contracting Officer in the administration of the plant protection and physical security program. Failure to agree on any or all elements of the plant protection plan within 30 calendar days after submission of the plan shall be considered a dispute concerning a question of fact within the meaning of the clause of this contract entitled "Disputes.”

(2) At any time during the term of this contract, the Contracting Officer, by a written order, may require the Contractor (1) to increase or decrease plant protection and physical security devices and equipment and (1) to increase or decrease the number of Contractor personnel assigned to plant protection duties. If any such change causes an increase or decrease in the cost of, or the time required for the performance of any part of the work under this contract, whether changed or not changed by any such order, an equitable adjustment shall be made in the contract price or delivery schedule or both and the contract shall be modified in writing accordingly. Any claim by the Contractor for adjustment under this clause must be asserted within 30 calendar days from the date of receipt by the Contractor of the notification of change: Provided, however, That the Contracting Officer, if he decides that the facts justify such action, may receive and act upon any such claim asserted at any time prior to final payment under the contract. Failure to agree to any adjustment shall be considered a dispute concerning a question of fact within the meaning of the clause of this contract entitled "Disputes." However, nothing in this clause shall excuse the Contractor from proceeding with the contract as changed.

(3) Title to all plant protection and physical security devices and equipment added under paragraph (2) of this clause and purchased by the Contractor, for the cost of which the Contractor is entitled to be reimbursed as a direct item of cost under this contract, shall pass to and vest in the Government upon delivery of such devices or equipment by the vendor. The Contractor,

during the term of this contract or any extension thereof, shall maintain and keep in good condition and repair in accordance with sound industrial practice all such devices and equipment.

(4) The Contracting Officer and designated security inspection personnel at all times during the performance of this contract or any extension thereof shall have access to the portions of the plant staffed and operated by the Contractor, under which the Contractor furnishes plant protection and physical security services, to inspect compliance by the Contractor with his plant protection plan and in order to inspect inventory, or remove in cooperation with the Contractor any plant protection and physical security devices and equipment.

[84 F.R. 9519, June 18, 1969, as amended at 35 F.R. 18050, Nov. 25, 1970]

§ 597.150-2 Marine risk.

The following clause may be used in contracts for chartering vessels for coastal, harbor, inland water, or similar services

MARINE RISK (FEBRUARY 1965)

The owner shall assume all marine risks of whatever nature or kind, including all risks or liability for breach of law or statutes or for damage caused to other vessels, persons, or property, except as otherwise provided herein. When official storm warnings have been issued or weather and water or other conditions render an operation unusually hazardous and the owner or master protests in writing to the Contracting Officer against undertaking the operation but thereafter the Contracting Officer orders him to perform the operation and he undertakes to do so and the vessel is damaged or lost as the proximate result of the unusual hazard protested against and not of the negligence of the owner, master, or crew, the Government shall, at its discretion, repair the damage to the vessel or reimburse the owner for the cost of such repairs or for the loss of the vessel, to the extent not covered by insurance and within the limit of funds against which indemnification by the Government to the Contractors for such loss or damage may lawfully be charged, but in no case in excess of the value of the vessel immediately preceding the incident causing the damage or loss and shall, for a period not to exceed days (in

sert the number of days estimated to repair or replace the vessel), reimburse the owner, within the funds limitation as indicated above, for the actual expenses of stand-by time, as determined by the Contracting Officer. The Contractor shall file a report of such damage or loss within 3 working days after date of the incident or the date of the vessel's return to port, whichever is the later date. Failure to file such a report within the time specified shall constitute a waiver of the right to indemnification based on liability of

All contracts awarded pursuant to AR 40-7 under which drugs are to be clinically investigated shall contain the following clause

CLINICAL STUDY OF INVESTIGATIONAL

DRUGS (NOVEMBER 1966)

(a) The Contractor, before undertaking to conduct either the clinical pharmacology or clinical trials of an investigational drug under a Department of the Army contract, shall submit for the written approval of The Surgeon General, Department of the Army, a signed completed application and three copies to The Surgeon General, Attention: Chairman, Army Investigational Drug Review Board, Department of the Army, Washington, D.C. 20315, using the following format: Investigator's statement:

I. Background data.

A. Name of investigator.
B. Date of request.

C. Name or other clear identification of drug.

D. Name of manufacturer or other source of drug.

E. Qualifications of investigator in detall or by reference to details already on file in Army records.

F. Name and address of facility or facilities where investigations will be conducted.

G. All known relevant information about past use or pertinent reference thereto available to both the investigator and the drug supplier, including all preclinical data, and all other information justifying the clinical investigation (1.8., the safety and rationale of the proposed study).

II. Plan and Conduct of Proposed Clinical Investigation.

A. Specific purpose and military need for or urgency of proposed clinical investigation.

B. Approximate number of subjects, their age, sex, condition, and other pertinent information relevant to the conditions of the investigation.

C. Number of subjects to be employed as controls (if any) and same information as in B above for such controls.

D. An outline of the phases of the investigation already planned either in detail or by reference to details already on file in Army records. This outline may include reasonable alternates and variations, and will be supplemented or amended when any signifcant change in direction or scope of the investigation is undertaken.

E. Description or copies of forms used to record data.

(b) The Contractor shall insure that each of its investigators who conduct either the clinical pharmacology or clinical trials of an investigational drug will maintain a record of clinical investigation separate from the patient's clinical record. This record of clinical investigation will include, minimally, a list of patients receiving the investigational drug; the name, lot number, date, and quantity of investigational drug prescribed; case histories; the details of clinical observations, tests, and laboratory procedures carried out on each subject before, during, and after administration of the drug in question.

(c) The Contractor shall also insure that either its responsible investigator or a responsible individual designated by him for the purpose will maintain a complete record of each investigational drug used under a DA contract for at least 3 years after completion of the investigational drug study. This record will include the following information: 1. Name of drug.

2. Manufacturer, or other source of drug. 3. Amount and date received. 4. Expiration date, if any. 5. Lot or control number.

6. Date of authority to use.

7. Names of individuals authorized to prescribe the drug.

8. Names dentist.

of prescribing physician or

9. Date on which use of the drug is terminated, if applicable.

10. Date on which use of the drug was approved for general use as a safe and efficaclous drug, if during course of investigation.

(d) The Contractor shall submit progress reports to The Surgeon General, Attention: Chairman, AIDRB, at least once annually, and shall submit a final report on termination of the investigaton. In addition the Contractor shall promptly report to the AIDRB any unusual or important observations occurring during the course of the investigational drug study, particularly if they involve any adverse effect that may be regarded as caused by the new drug; if the adverse effect is alarming, it shall be reported to the AIDRB immediately.

(e) Special Conditions Applicable to Clinical Investigation of New Drugs: The contractor shall insure that the investigational drug is administered to subjects only under the personal supervision of the responsible investigator or a qualified person to whom the responsible investigator has delegated this authority. The Contractor shall also insure that all subjects participating in the investigation or their representatives are fully informed and understand that the new drug is being used for investigational purposes. The written consent of the subjects, or their representatives shall be obtained except where this is not feasible or, in the respoдsible investigator's professional judgment, is contrary to the best interests of the subject.