41 U.S.C. § 4706 — Examination of facilities and records of

Page 141 TITLE 41—PUBLIC CONTRACTS § 4706 1 See References in Text note below. substantial violation of law related to a con- tract (including the competition for, or negotia- tion of, a contract). (c) INVESTIGATION OF COMPLAINTS.—An indi- vidual who believes that the individual has been subjected to a reprisal prohibited by subsection (b) may submit a complaint to the Inspector General of the executive agency. Unless the In- spector General determines that the complaint is frivolous, the Inspector General shall inves- tigate the complaint and, on completion of the investigation, submit a report of the findings of the investigation to the individual, the con- tractor concerned, and the head of the agency. If the executive agency does not have an Inspector General, the duties of the Inspector General under this section shall be performed by an offi- cial designated by the head of the executive agency. (d) REMEDY AND ENFORCEMENT AUTHORITY.— (1) ACTIONS CONTRACTOR MAY BE ORDERED TO TAKE.—If the head of an executive agency de- termines that a contractor has subjected an individual to a reprisal prohibited by sub- section (b), the head of the executive agency may take one or more of the following actions: (A) ABATEMENT.—Order the contractor to take affirmative action to abate the re- prisal. (B) REINSTATEMENT.—Order the contractor to reinstate the individual to the position that the individual held before the reprisal, together with the compensation (including back pay), employment benefits, and other terms and conditions of employment that would apply to the individual in that posi- tion if the reprisal had not been taken. (C) PAYMENT.—Order the contractor to pay the complainant an amount equal to the ag- gregate amount of all costs and expenses (in- cluding attorneys’ fees and expert witnesses’ fees) that the complainant reasonably in- curred for, or in connection with, bringing the complaint regarding the reprisal, as de- termined by the head of the executive agen- cy. (2) ENFORCEMENT ORDER.—When a contractor fails to comply with an order issued under paragraph (1), the head of the executive agen- cy shall file an action for enforcement of the order in the United States district court for a district in which the reprisal was found to have occurred. In an action brought under this paragraph, the court may grant appropriate relief, including injunctive relief and compen- satory and exemplary damages. (3) REVIEW OF ENFORCEMENT ORDER.—A per- son adversely affected or aggrieved by an order issued under paragraph (1) may obtain review of the order’s conformance with this subsection, and regulations issued to carry out this section, in the United States court of ap- peals for a circuit in which the reprisal is al- leged in the order to have occurred. A petition seeking review must be filed no more than 60 days after the head of the agency issues the order. Review shall conform to chapter 7 of title 5. (e) SCOPE OF SECTION.—This section does not— (1) authorize the discharge of, demotion of, or discrimination against an employee for a disclosure other than a disclosure protected by subsection (b); or (2) modify or derogate from a right or rem- edy otherwise available to the employee. (f) FOUR-YEAR SUSPENSION OF EFFECTIVENESS WHILE PILOT PROGRAM IS IN EFFECT.—While sec- tion 4712 1 of this title is in effect, this section shall not be in effect. (Pub. L. 111–350, § 3, Jan. 4, 2011, 124 Stat. 3796; Pub. L. 112–239, div. A, title VIII, § 828(c), Jan. 2, 2013, 126 Stat. 1841; Pub. L. 117–286, § 4(b)(72), Dec. 27, 2022, 136 Stat. 4351.) HISTORICAL AND REVISION NOTES Revised Section Source (U.S. Code) Source (Statutes at Large) 4705(a) ........ 41:265(e). June 30, 1949, ch. 288, title III, § 315, as added Pub. L. 103–355, title VI, § 6006, Oct. 13, 1994, 108 Stat. 3365; Pub. L. 104–106, title XLIII, § 4321(e)(8), Feb. 10, 1996, 110 Stat. 675. 4705(b) ........ 41:265(a). 4705(c) ........ 41:265(b). 4705(d) ........ 41:265(c). 4705(e) ........ 41:265(d). In subsection (d)(2), the word ‘‘contractor’’ is sub- stituted for ‘‘person’’ for clarity and for consistency with subsection (d)(1). Editorial Notes REFERENCES IN TEXT Section 4712 of this title, referred to in subsec. (f), formerly referred to a pilot program in the section catchline and contained a subsec. (i) which provided that section 4712 would be in effect for a specified four- year period. The section catchline was amended and subsec. (i) was struck out by Pub. L. 114–261, § 1(a)(3)(A), Dec. 14, 2016, 130 Stat. 1362. AMENDMENTS 2022—Subsec. (a)(3). Pub. L. 117–286 substituted ‘‘chap- ter 4 of title 5.’’ for ‘‘the Inspector General Act of 1978 (5 U.S.C. App.).’’ 2013—Subsec. (f). Pub. L. 112–239 added subsec. (f). § 4706. Examination of facilities and records of contractor (a) DEFINITION.—In this section, the term ‘‘records’’ includes books, documents, account- ing procedures and practices, and other data, re- gardless of type and regardless of whether the items are in written form, in the form of com- puter data, or in any other form. (b) AGENCY AUTHORITY.— (1) INSPECTION OF PLANT AND AUDIT OF RECORDS.—The head of an executive agency, acting through an authorized representative, may inspect the plant and audit the records of— (A) a contractor performing a cost-reim- bursement, incentive, time-and-materials, labor-hour, or price-redeterminable con- tract, or any combination of those con- tracts, the executive agency makes under this division; and (B) a subcontractor performing a cost-re- imbursement, incentive, time-and-materials, labor-hour, or price-redeterminable sub- contract, or any combination of those sub- Page 142 TITLE 41—PUBLIC CONTRACTS § 4706 contracts, under a contract referred to in subparagraph (A). (2) EXAMINATION OF RECORDS.—The head of an executive agency, acting through an au- thorized representative, may, for the purpose of evaluating the accuracy, completeness, and currency of certified cost or pricing data re- quired to be submitted pursuant to chapter 35 of this title with respect to a contract or sub- contract, examine all records of the con- tractor or subcontractor related to— (A) the proposal for the contract or sub- contract; (B) the discussions conducted on the pro- posal; (C) pricing of the contract or subcontract; or (D) performance of the contract or sub- contract. (c) SUBPOENA POWER.— (1) AUTHORITY TO REQUIRE THE PRODUCTION OF RECORDS.—The Inspector General of an execu- tive agency appointed under section 403 or 415 of title 5 or, on request of the head of an exec- utive agency, the Director of the Defense Con- tract Audit Agency (or any successor agency) of the Department of Defense or the Inspector General of the General Services Administra- tion may require by subpoena the production of records of a contractor, access to which is provided for that executive agency by sub- section (b). (2) ENFORCEMENT OF SUBPOENA.—A subpoena under paragraph (1), in the case of contumacy or refusal to obey, is enforceable by order of an appropriate United States district court. (3) AUTHORITY NOT DELEGABLE.—The author- ity provided by paragraph (1) may not be dele- gated. (4) REPORT.—In the year following a year in which authority provided in paragraph (1) is exercised for an executive agency, the head of the executive agency shall submit to the Com- mittee on Homeland Security and Govern- mental Affairs of the Senate and the Com- mittee on Oversight and Government Reform of the House of Representatives a report on the exercise of the authority during the pre- ceding year and the reasons why the authority was exercised in any instance. (d) AUTHORITY OF COMPTROLLER GENERAL.— (1) IN GENERAL.—Except as provided in para- graph (2), each contract awarded after using procedures other than sealed bid procedures shall provide that the Comptroller General and representatives of the Comptroller Gen- eral may examine records of the contractor, or any of its subcontractors, that directly per- tain to, and involve transactions relating to, the contract or subcontract and to interview any current employee regarding the trans- actions. (2) EXCEPTION FOR FOREIGN CONTRACTOR OR SUBCONTRACTOR.—Paragraph (1) does not apply to a contract or subcontract with a foreign contractor or foreign subcontractor if the ex- ecutive agency concerned determines, with the concurrence of the Comptroller General or the designee of the Comptroller General, that ap- plying paragraph (1) to the contract or sub- contract would not be in the public interest. The concurrence of the Comptroller General or the designee is not required when— (A) the contractor or subcontractor is— (i) the government of a foreign country or an agency of that government; or (ii) precluded by the laws of the country involved from making its records available for examination; and (B) the executive agency determines, after taking into account the price and avail- ability of the property and services from United States sources, that the public inter- est would be best served by not applying paragraph (1). (3) ADDITIONAL RECORDS NOT REQUIRED.— Paragraph (1) does not require a contractor or subcontractor to create or maintain a record that the contractor or subcontractor does not maintain in the ordinary course of business or pursuant to another law. (e) LIMITATION ON AUDITS RELATING TO INDI- RECT COSTS.—An executive agency may not per- form an audit of indirect costs under a contract, subcontract, or modification before or after en- tering into the contract, subcontract, or modi- fication when the contracting officer determines that the objectives of the audit can reasonably be met by accepting the results of an audit that was conducted by another department or agency of the Federal Government within one year pre- ceding the date of the contracting officer’s de- termination. (f) EXPIRATION OF AUTHORITY.—The authority of an executive agency under subsection (b) and the authority of the Comptroller General under subsection (d) shall expire 3 years after final payment under the contract or subcontract. (g) INAPPLICABILITY TO CERTAIN CONTRACTS.— This section does not apply to the following con- tracts: (1) Contracts for utility services at rates not exceeding those established to apply uni- formly to the public, plus any applicable rea- sonable connection charge. (2) A contract or subcontract that is not greater than the simplified acquisition thresh- old. (h) ELECTRONIC FORM ALLOWED.—This section does not preclude a contractor from duplicating or storing original records in electronic form. (i) ORIGINAL RECORDS NOT REQUIRED.—An ex- ecutive agency shall not require a contractor or subcontractor to provide original records in an audit carried out pursuant to this section if the contractor or subcontractor provides photo- graphic or electronic images of the original records and meets the following requirements: (1) PRESERVATION PROCEDURES ESTAB- LISHED.—The contractor or subcontractor has established procedures to ensure that the im- aging process preserves the integrity, reli- ability, and security of the original records. (2) INDEXING SYSTEM MAINTAINED.—The con- tractor or subcontractor maintains an effec- tive indexing system to permit timely and convenient access to the imaged records. (3) ORIGINAL RECORDS RETAINED.—The con- tractor or subcontractor retains the original Page 143 TITLE 41—PUBLIC CONTRACTS § 4710 records for a minimum of one year after imag- ing to permit periodic validation of the imag- ing systems. (Pub. L. 111–350, § 3, Jan. 4, 2011, 124 Stat. 3797; Pub. L. 117–286, § 4(b)(73), Dec. 27, 2022, 136 Stat. 4351.) HISTORICAL AND REVISION NOTES Revised Section Source (U.S. Code) Source (Statutes at Large) 4706(a) ........ 41:254d(i). June 30, 1949, ch. 288, title III, § 304C(a)(1), (b), (g)–(i), as added Pub. L. 103–355, title II, § 2251(a), Oct. 13, 1994, 108 Stat. 3318, 3320. 4706(b)(1) .... 41:254d(a)(1). 4706(b)(2) .... 41:254d(a)(2). June 30, 1949, ch. 288, title III, § 304C(a)(2), as added Pub. L. 103–355, title II, § 2251(a), Oct. 13, 1994, 108 Stat. 3318; Pub. L. 104–106, title XLIII, § 4321(e)(5), Feb. 10, 1996, 110 Stat. 675. 4706(c) ........ 41:254d(b). 4706(d) ........ 41:254d(c). June 30, 1949, ch. 288, title III, § 304C(c), as added Pub. L. 103–355, title II, § 2251(a), Oct. 13, 1994, 108 Stat. 3319; Pub. L. 110–417, title VIII, § 871(a), Oct. 14, 2008, 122 Stat.4555. 4706(e) ........ 41:254d(d). June 30, 1949, ch. 288, title III, § 304C(d), as added Pub. L. 103–355, title II, § 2251(a), Oct. 13, 1994, 108 Stat. 3319; Pub. L. 104–201, title VIII, § 808(b), Sept. 23, 1996, 110 Stat. 2607. 4706(f) ........ 41:254d(e). 4706(g) ........ 41:254d(f). June 30, 1949, ch. 288, title III, § 304C(f), as added and amended Pub. L. 103–355, title II, § 2251(a), title IV, § 4103(d), Oct. 13, 1994, 108 Stat. 3320, 3341. 4706(h) ....... 41:254d(g). 4706(i) ........ 41:254d(h). In subsection (c)(4), the words ‘‘Committee on Over- sight and Government Reform’’ are substituted for ‘‘Committee on Government Operations’’ on authority of section 1(a)(6) of Public Law 104–14 (2 U.S.C. note prec. 21), Rule X(1)(h) of the Rules of the House of Rep- resentatives, adopted by House Resolution No. 5 (106th Congress, January 6, 1999), and Rule X(1)(m) of the Rules of the House of Representatives, adopted by House Resolution No. 6 (110th Congress, January 5, 2007). The words ‘‘Committee on Homeland Security and Governmental Affairs’’ are substituted for ‘‘Com- mittee on Governmental Affairs’’ on authority of Sen- ate Resolution No. 445 (108th Congress, October 9, 2004). Editorial Notes AMENDMENTS 2022—Subsec. (c)(1). Pub. L. 117–286 substituted ‘‘sec- tion 403 or 415 of title 5’’ for ‘‘section 3 or 8G of the In- spector General Act of 1978 (5 U.S.C. App.)’’. Statutory Notes and Related Subsidiaries CHANGE OF NAME Committee on Oversight and Government Reform of House of Representatives changed to Committee on Oversight and Reform of House of Representatives by House Resolution No. 6, One Hundred Sixteenth Con- gress, Jan. 9, 2019. Committee on Oversight and Reform of House of Representatives changed to Committee on Oversight and Accountability of House of Representa- tives by House Resolution No. 5, One Hundred Eight- eenth Congress, Jan. 9, 2023. § 4707. Remission of liquidated damages When a contract made on behalf of the Federal Government by the head of a Federal agency, or by an authorized officer of the agency, includes a provision for liquidated damages for delay, the Secretary of the Treasury on recommendation of the head of the agency may remit any part of the damages as the Secretary of the Treasury believes is just and equitable. (Pub. L. 111–350, § 3, Jan. 4, 2011, 124 Stat. 3799.) HISTORICAL AND REVISION NOTES Revised Section Source (U.S. Code) Source (Statutes at Large) 4707 ............ 41:256a. Sept. 5, 1950, ch. 849, § 10(a), 64 Stat. 591; Pub. L. 104–316, title II, § 202(u), Oct. 19, 1996, 110 Stat. 3845. § 4708. Payment of reimbursable indirect costs in cost-type research and development con- tracts with educational institutions A cost-type research and development con- tract (including a grant) with a university, col- lege, or other educational institution may pro- vide for payment of reimbursable indirect costs on the basis of predetermined fixed-percentage rates applied to the total of the reimbursable di- rect costs incurred or to an element of the total of the reimbursable direct costs incurred. (Pub. L. 111–350, § 3, Jan. 4, 2011, 124 Stat. 3799.) HISTORICAL AND REVISION NOTES Revised Section Source (U.S. Code) Source (Statutes at Large) 4708 ............ 41:254a. Pub. L. 87–638, Sept. 5, 1962, 76 Stat. 437. The words ‘‘On and after September 5, 1962’’ are omit- ted as obsolete. § 4709. Implementation of electronic commerce capability (a) ROLE OF HEAD OF EXECUTIVE AGENCY.—The head of each executive agency shall implement the electronic commerce capability required by section 2301 of this title. In implementing the capability, the head of an executive agency shall consult with the Administrator. (b) PROGRAM MANAGER.—The head of each ex- ecutive agency shall designate a program man- ager to implement the electronic commerce ca- pability for the agency. The program manager reports directly to an official at a level not lower than the senior procurement executive designated for the agency under section 1702(c) of this title. (Pub. L. 111–350, § 3, Jan. 4, 2011, 124 Stat. 3800.) HISTORICAL AND REVISION NOTES Revised Section Source (U.S. Code) Source (Statutes at Large) 4709 ............ 41:252c. June 30, 1949, ch. 288, title III, § 302C, as added Pub. L. 103–355, title IX, § 9003, Oct. 13, 1994, 108 Stat. 3403; Pub. L. 105–85, title VIII, § 850(f)(4)(A), Nov. 18, 1997, 111 Stat. 1850. § 4710. Limitations on tiering of subcontractors (a) DEFINITION.—In this section, the term ‘‘ex- ecutive agency’’ has the same meaning given in section 133 of this title.