10 U.S.C. § 2563 — Articles and services of industrial facili-

Page 1992 TITLE 10—ARMED FORCES [§ 2562 ‘‘(B) The number of scheduled and completed trans- portation missions for purposes of providing humani- tarian assistance under this section. ‘‘(C) A description of any transfer of excess nonlethal supplies of the Department of Defense made available for humanitarian relief purposes under section 2557 of this title. The description shall include the date of the transfer, the entity to whom the transfer is made, and the quantity of items transferred.’’ 2013—Subsec. (f)(2). Pub. L. 112–239 substituted ‘‘Com- mittee on Foreign Affairs’’ for ‘‘Committee on Inter- national Relations’’. 2003—Subsec. (a). Pub. L. 108–136 designated existing provisions as par. (1) and added par. (2). 2000—Pub. L. 106–398, § 1 [[div. A], title X, § 1033(b)(1)], renumbered section 2551 of this title as this section. Subsec. (c)(3)(C). Pub. L. 106–398, § 1 [[div. A], title X, § 1033(c)(1)], substituted ‘‘section 2557’’ for ‘‘section 2547’’. 1999—Subsec. (f)(2). Pub. L. 106–65 substituted ‘‘Com- mittee on Armed Services’’ for ‘‘Committee on Na- tional Security’’. 1996—Subsec. (b). Pub. L. 104–106, § 1312(1), (2), redesig- nated subsec. (d) as (b) and struck out former subsec. (b) which read as follows: ‘‘AUTHORITY TO TRANSFER FUNDS.—To the extent provided in defense authoriza- tion Acts for a fiscal year, the Secretary of Defense may transfer to the Secretary of State funds appro- priated for the purposes of this section to provide for— ‘‘(1) the payment of administrative costs incurred in providing the transportation described in sub- section (a); and ‘‘(2) the purchase or other acquisition of transpor- tation assets for the distribution of humanitarian re- lief supplies in the country of destination.’’ Subsec. (c). Pub. L. 104–106, § 1312(1), (3), added subsec. (c) and struck out former subsec. (c) which read as fol- lows: ‘‘(c) TRANSPORTATION OF HUMANITARIAN RELIEF.—(1) Transportation of humanitarian relief provided with funds appropriated for the purposes of this section shall be provided under the direction of the Secretary of State. ‘‘(2) Such transportation shall be provided by the most economical commercial or military means avail- able, unless the Secretary of State determines that it is in the national interest of the United States to pro- vide such transportation other than by the most eco- nomical means available. The means used to provide such transportation may include the use of aircraft and personnel of the reserve components of the Armed Forces. ‘‘(3) Nothing in this subsection shall be construed as waiving the requirements of section 2631 of this title and sections 901(b) and 901b of the Merchant Marine Act, 1936 (46 U.S.C. App. 1241(b) and 1241f).’’ Subsec. (d). Pub. L. 104–106, § 1312(4), redesignated sub- sec. (f) as (d) and substituted ‘‘the congressional com- mittees specified in subsection (f) and the Committees on Appropriations of the Senate and House of Rep- resentatives of the’’ for ‘‘the Committees on Appropria- tions and on Armed Services of the Senate and House of Representatives, the Committee on Foreign Rela- tions of the Senate, and the Committee on Foreign Af- fairs of the House of Representatives of the’’. Former subsec. (d) redesignated (b). Subsec. (e). Pub. L. 104–106, § 1312(3), (5), redesignated subsec. (g) as (e) and struck out former subsec. (e) which required status reports and specified time for submission, coverage, and contents. Subsec. (f). Pub. L. 104–106, § 1312(6), added subsec. (f). Former subsec. (f) redesignated (d). Subsec. (g). Pub. L. 104–106, § 1312(5), redesignated sub- sec. (g) as (e). Statutory Notes and Related Subsidiaries NOTIFICATIONS REGARDING HUMANITARIAN RELIEF Notification provided to appropriate congressional committees with respect to assistance under this sec- tion to include detailed description of items for which transportation is provided that are excess nonlethal supplies of Department of Defense, including quantity, acquisition value, and value at time of transportation of such items, see section 1504(c) of Pub. L. 103–160, set out in a Humanitarian and Civic Assistance note under section 401 of this title. LAWS COVERED BY INITIAL REPORTS Pub. L. 102–484, div. A, title III, § 304(d), Oct. 28, 1992, 106 Stat. 2362, provided that for purposes of subsec. (e) of this section, section 304 of Pub. L. 102–190 (105 Stat. 1333) and the humanitarian relief laws referred to in section 304(f)(4) of Pub. L. 102–190 (as in effect on the day before Oct. 23, 1992) were to be considered as provi- sions of law that authorized appropriations for humani- tarian assistance to be available for the purposes of this section. [§ 2562. Repealed. Pub. L. 114–328, div. A, title XII, § 1253(a)(1)(C), Dec. 23, 2016, 130 Stat. 2532] Section, added Pub. L. 102–484, div. D, title XLIII, § 4304(a), Oct. 23, 1992, 106 Stat. 2699, § 2552; renumbered § 2562 and amended Pub. L. 106–398, § 1 [[div. A], title X, § 1033(b)(1), (c)(2)], Oct. 30, 2000, 114 Stat. 1654, 1654A–260; Pub. L. 107–217, § 3(b)(8), Aug. 21, 2002, 116 Stat. 1295; Pub. L. 107–314, div. A, title X, § 1062(e)(1), Dec. 2, 2002, 116 Stat. 2651; Pub. L. 111–350, § 5(b)(41), Jan. 4, 2011, 124 Stat. 3846, related to the limitation on use of excess construction or fire equipment from Department of De- fense stocks in foreign assistance or military sales pro- grams. § 2563. Articles and services of industrial facili- ties: sale to persons outside the Department of Defense (a) AUTHORITY TO SELL OUTSIDE DOD.—(1) The Secretary of Defense may sell in accordance with this section to a person outside the Depart- ment of Defense articles and services referred to in paragraph (2) that are not available from any United States commercial source. (2)(A) Except as provided in subparagraph (B), articles and services referred to in paragraph (1) are articles and services that are manufactured or performed by any working-capital funded in- dustrial facility of the armed forces. (B) The authority in this section does not apply to sales of articles and services by a work- ing-capital funded Army industrial facility (in- cluding a Department of the Army arsenal) that manufactures large caliber cannons, gun mounts, recoil mechanisms, ammunition, muni- tions, or components thereof, which are gov- erned by regulations required by section 7543 of this title. (b) DESIGNATION OF PARTICIPATING INDUSTRIAL FACILITIES.—The Secretary may designate fa- cilities referred to in subsection (a) as the facili- ties from which articles and services manufac- tured or performed by such facilities may be sold under this section. (c) CONDITIONS FOR SALES.—(1) A sale of arti- cles or services may be made under this section only if— (A) the Secretary of Defense determines that the articles or services are not available from a commercial source in the United States; (B) the purchaser agrees to hold harmless and indemnify the United States, except as provided in paragraph (3), from any claim for damages or injury to any person or property arising out of the articles or services; Page 1993 TITLE 10—ARMED FORCES § 2564 (C) the articles or services can be substan- tially manufactured or performed by the in- dustrial facility concerned with only inci- dental subcontracting; (D) it is in the public interest to manufac- ture the articles or perform the services; (E) the Secretary determines that the sale of the articles or services will not interfere with the military mission of the industrial facility concerned; and (F) the sale of the goods and services is made on the basis that it will not interfere with per- formance of work by the industrial facility concerned for the Department of Defense. (2) The Secretary of Defense may waive the condition in paragraph (1)(A) and subsection (a)(1) that an article or service must be not available from a United States commercial source in the case of a particular sale if the Sec- retary determines that the waiver is necessary for reasons of national security and notifies Congress regarding the reasons for the waiver. (3) Paragraph (1)(B) does not apply in any case of willful misconduct or gross negligence or in the case of a claim by a purchaser of articles or services under this section that damages or in- jury arose from the failure of the Government to comply with quality, schedule, or cost perform- ance requirements in the contract to provide the articles or services. (d) METHODS OF SALE.—(1) The Secretary shall permit a purchaser of articles or services under this section to use advance incremental funding to pay for the articles or services. (2) In the sale of articles and services under this section, the Secretary shall— (A) charge the purchaser, at a minimum, the variable costs, capital improvement costs, and equipment depreciation costs that are associ- ated with the articles or services sold; (B) enter into a firm, fixed-price contract or, if agreed by the purchaser, a cost reimburse- ment contract for the sale; and (C) develop and maintain (from sources other than appropriated funds) working cap- ital to be available for paying design costs, planning costs, procurement costs, and other costs associated with the articles or services sold. (e) DEPOSIT OF PROCEEDS.—Proceeds from sales of articles and services under this section shall be credited to the funds, including working cap- ital funds and operation and maintenance funds, incurring the costs of manufacture or perform- ance. (f) RELATIONSHIP TO ARMS EXPORT CONTROL ACT.—Nothing in this section shall be construed to affect the application of the export controls provided for in section 38 of the Arms Export Control Act (22 U.S.C. 2778) to items which in- corporate or are produced through the use of an article sold under this section. (g) DEFINITIONS.—In this section: (1) The term ‘‘advance incremental fund- ing’’, with respect to a sale of articles or serv- ices, means a series of partial payments for the articles or services that includes— (A) one or more partial payments before the commencement of work or the incurring of costs in connection with the manufacture of the articles or the performance of the services, as the case may be; and (B) subsequent progress payments that re- sult in full payment being completed as the required work is being completed. (2) The term ‘‘not available’’, with respect to an article or service proposed to be sold under this section, means that the article or service is unavailable from a commercial source in the required quantity and quality or within the time required. (3) The term ‘‘variable costs’’, with respect to sales of articles or services, means the costs that are expected to fluctuate directly with the volume of sales and— (A) in the case of articles, the volume of production necessary to satisfy the sales or- ders; or (B) in the case of services, the extent of the services sold. (Added Pub. L. 103–337, div. A, title III, § 339(a)(1), Oct. 5, 1994, 108 Stat. 2718, § 2553; amended Pub. L. 106–65, div. A, title III, § 331(a)(2), (b), Oct. 5, 1999, 113 Stat. 566, 567; re- numbered § 2563, Pub. L. 106–398, § 1 [[div. A], title X, § 1033(b)(1)], Oct. 30, 2000, 114 Stat. 1654, 1654A–260; Pub. L. 107–107, div. A, title III, § 343(a), Dec. 28, 2001, 115 Stat. 1061; Pub. L. 115–232, div. A, title VIII, § 809(a), Aug. 13, 2018, 132 Stat. 1840.) Editorial Notes AMENDMENTS 2018—Subsec. (a)(2)(B). Pub. L. 115–232 substituted ‘‘section 7543’’ for ‘‘section 4543’’. 2001—Subsec. (c)(1)(B). Pub. L. 107–107, § 343(a)(1), sub- stituted ‘‘as provided in paragraph (3)’’ for ‘‘in any case of willful misconduct or gross negligence’’. Subsec. (c)(3). Pub. L. 107–107, § 343(a)(2), added par. (3). 2000—Pub. L. 106–398 renumbered section 2553 of this title as this section. 1999—Subsec. (c). Pub. L. 106–65, § 331(a)(2), designated existing provisions as par. (1), redesignated former pars. (1) to (6) as subpars. (A) to (F), respectively, of par. (1), and added par. (2). Subsec. (g)(2), (3). Pub. L. 106–65, § 331(b), added par. (2) and redesignated former par. (2) as (3). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2018 AMENDMENT Amendment by Pub. L. 115–232 effective Feb. 1, 2019, with provision for the coordination of amendments and special rule for certain redesignations, see section 800 of Pub. L. 115–232, set out as a note preceding section 3001 of this title. EFFECTIVE DATE Pub. L. 103–337, div. A, title III, § 339(b), Oct. 5, 1994, 108 Stat. 2720, provided that: ‘‘Section 2553 [now 2563] of title 10, United States Code, as added by subsection (a), shall take effect on April 1, 1995.’’ § 2564. Provision of support for certain sporting events (a) SECURITY AND SAFETY ASSISTANCE.—At the request of a Federal, State, or local government agency responsible for providing law enforce- ment services, security services, or safety serv- ices, the Secretary of Defense may authorize the