PRIA, Government Policy, Made Personal

Summary

The Department of Defense may only use its funds on contracts that include a rule letting the United States stop the contractor from working on the contract if the relevant Secretary or their chosen official finds, after giving notice and holding a hearing, that the contractor or someone representing them offered or gave entertainment, gifts, or similar favors to a U.S. officer or employee to win the contract or get favorable treatment. If the contract is ended for that reason, the government gets the same remedies as for a breach and can also get extra damages equal to 3 to 10 times what the contractor spent on those gratuities, as set by the Secretary or their chosen official. The Secretary’s findings can be reviewed in court. This rule does not apply to contracts at or below the federal simplified acquisition threshold.

Title 10, §4651

Armed Forces, Source: USLM XML via OLRC

(a)Money appropriated to the Department of Defense may not be spent under a contract other than a contract for personal services unless that contract provides that—

(1)the United States may, by written notice to the contractor, terminate the right of the contractor to proceed under the contract if the Secretary concerned or his designee finds, after notice and hearing, that the contractor, or his agent or other representative, offered or gave any gratuity, such as entertainment or a gift, to an officer, official, or employee of the United States to obtain a contract or favorable treatment in the awarding, amending, or making of determinations concerning the performance, of a contract; and

(2)if a contract is terminated under clause (1), the United States has the same remedies against the contractor that it would have had if the contractor had breached the contract and, in addition to other damages, is entitled to exemplary damages in an amount at least three, but not more than 10, as determined by the Secretary or his designee, times the cost incurred by the contractor in giving gratuities to the officer, official, or employee concerned.

The existence of facts upon which the Secretary makes findings under clause (1) may be reviewed by any competent court.

(b)This section does not apply to a contract that is for an amount not greater than the simplified acquisition threshold (as defined in section 134 of title 41).

Notes & Related Subsidiaries

Historical and Revision Notes

Revised sectionSource (U.S. Code)Source (Statutes at Large) 22075:174d.

June 30, 1954, ch. 432, § 719, 68 Stat. 353. The following substitutions are made: “spent” for “expended”; “United States” for “Government”; “if a contract is terminated under clause (1)” for “that in the event any such contract is so terminated”; and “has . . . that it would have had if” for “shall be entitled . . . to pursue . . . as it could pursue in the event of”. The word “official” is inserted for clarity. The words “entered into after

June 30, 1954” are omitted as executed.

Editorial Notes

Prior Provisions

A prior section 4651, Aug. 10, 1956, ch. 1041, 70A Stat. 260; Pub. L. 99–145, title XIII, § 1301(b(3)(C), Nov. 8, 1985, 99 Stat. 736, related to issuance of arms, tentage, and equipment necessary for proper military training to institutions not maintaining units of the Reserve Officers’ Training Corps, prior to repeal by Pub. L. 112–239, div. A, title V, § 552(b), Jan. 2, 2013, 126 Stat. 1741.

Amendments

2021—Pub. L. 116–283 renumbered section 2207 of this title as this section. 2011—Subsec. (b). Pub. L. 111–350 substituted “section 134 of title 41” for “section 4(11) of the Office of Federal Procurement Policy Act (41 U.S.C. 403(11))”. 1996—Pub. L. 104–106 designated existing provisions as subsec. (a) and added subsec. (b).

Statutory Notes and Related Subsidiaries

Effective Date

of 2021 AmendmentAmendment by Pub. L. 116–283 effective Jan. 1, 2022, with additional provisions for delayed implementation and applicability of existing law, see section 1801(d) of Pub. L. 116–283, set out as a note preceding section 3001 of this title.

§4651 Expenditure of Appropriations: Limitation