In July 2008, DOD proposed revisions to the Specialty Metals rules, hoping to finally calm the turbulence that has boiled up over the past three years in this area. On July 29, 2009, after more than a year of stolid deliberation, DOD issued final rules implementing the latest statutory revisions from January 2008See 74 Federal Register 37626.
 


Continue Reading More Than a Year In the Making! — DOD Issues Final Rules for Specialty Metals; New Rules Are No Less Complicated

On February 23, 2009, the Office of the Secretary of Defense and the Strategic Materials Protection Board issued an analysis of the national security issues associated with the purchase of specialty metals. See 74 Federal Register 8061. The analysis concluded that, while specialty metals are plainly essential for certain important defense systems, they are not "critical materials," nor do national security considerations require that only U.S.-produced specialty metals be used for DOD applications. This conclusion is very interesting, especially in light of the position taken by Congress for the last 35 years that the domestic specialty metals industry is purportedly critical to our national interests and that extraordinary measures are required to protect that domestic industry. 

We have previously expressed the opinion that the Berry Amendment, and the specialty metals restriction in particular, is "a relic of a former age, ill-suited to the realities of our global marketplace and current procurement demands." We hope that this latest analysis from the Strategic Materials Protection Board will provide a foundation for some long overdue Congressional action to simplify, if not eliminate, what has become one the most complex aspects of DOD contracting, with a hodgepodge of different ad hoc rules affecting different contracts being simultaneously performed within a single manufacturing plant. 
 


Continue Reading DOD Conclude That Specialty Metals Are Not Materials Critical To The National Security Interests Of The U.S.

On July 21, 2008, the U.S. Department of Defense ("DOD") issued for comment proposed rules implementing 10 U.S.C. § 2533b, the latest statutory restrictions on DOD purchases of non-domestic specialty metals.  73 Federal Register 42300.

If this topic is of interest to you, please note that these proposed rules are not yet final and DOD is still accepting comments through September 19, 2008.


Continue Reading Hitchcock And Specialty Metals – DOD’s New Proposed Rules Are Dizzying; Ambiguities Remain

On March 21, 2008, the Executive Director of Contracts for the Defense Contract Management Agency, David E. Ricci, indicated that DCMA is considering a single process initiative (SPI) approach to streamline the morass of specialty metals rules that have come about in the last 18 months due to various legislative and regulatory changes.  This announcement follows a new Class Deviation issued by DCMA on January 29, 2008 to implement the latest legislative directives, superseding prior announcements.


Continue Reading New Specialty Metals Rules Add To Existing Confusion; DOD Suggests Single Process Initiative May Help Streamline Application

On December 14, 2007, Congress passed H.R. 1585, the 2008 Defense Authorization Bill. President Bush stated on December 28, 2007 that he intended to "pocket veto" the Bill because he viewed a particular section as potentially jeopardizing the ability of the Iraqi government to focus its resources on rebuilding. Regardless of whether the President’s "pocket veto" is successful (Speaker Pelosi has stated that the House is currently considering whether to revise the legislation), it appears that there is more than enough support to override now that Congress has returned to session. Consequently, the provisions of H.R. 1585 are likely to become law one way or another.


Continue Reading New Legislation Would Loosen Specialty Metals Restrictions While Leaving Heavy Administrative Burdens on Industry