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Improved Anti-Counterfeit Provisions of Final DFARS Rule

The U.S. Department of Defense has published its final Defense Federal Acquisition Regulation Supplement (DFARS) that addresses required sources of electronic parts for defense contractors and subcontractors.  The final rule provides further clarification of earlier DFARS implementing the anti-counterfeiting provisions contained in the National Defense Authorization Acts (NDAA) of FY 2012 and FY 2015.

ECIA is pleased to announce that the final rule incorporates many of the suggested changes recommended by the association.  ECIA submitted comments in response to the proposed rule (DFARS Case 2014-D005) focused on five main areas: 1) use and definition of the terms "authorized dealer" and 2) "trusted supplier;" 3) procurement policy; 4) traceability; and 5) flow down requirements.  The association was successful in each of these areas.

The wording of key terms was essential and ECIA believes the final rule gets it right. The term "authorized dealer" was deleted and replaced with the term "authorized supplier."  An authorized supplier is any supplier, distributor, or an aftermarket manufacturer with a contractual arrangement with the original manufacturer to buy, stock, repackage, sell or distribute the part. The term "trusted supplier" was deleted and replaced with the term "contractor-approved supplier."  Contractor-approved supplier means a supplier that does not have a contractual agreement with the original component manufacturer for a transaction, but has been identified as trustworthy by a contractor or subcontractor.

The rule establishes a strict, three-tiered approach to the procurement of electronics parts; it provides that the contractor is responsible for inspection, testing and authentication if the contractor cannot establish traceability from the original manufacturer for a specific part; and it clarifies that the flow-down requirements do not apply to the original component manufacturer. 

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