Purchasing of Property and Services

<RULE> POSTAL SERVICE <CFR>39 CFR Part 601</CFR> <SUBJECT>Purchasing of Property and Services</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Postal Service. <HD SOURCE="HED">ACTION:</HD> Final rule. <SUM> <HD SOURCE="HED">SUMMARY:</HD> The Postal Service is revising its purchasing regulations governing debarment, suspension, and ineligibility from contracting to provide improved organization and clarity, updates to definitions and processes to better reflect actual practice, and alternatives in lieu of suspension and debarment. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> Effective November 19, 2025. </EFFDATE> <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Robert Dietz at 202-268-6088 or Susan Witt at 202-268-4833 </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> The following updates to 39 CFR 601.113 are being included: • Section 601.113 is now titled “ <E T="03">Debarment, Suspension, and Ineligibility from Contracting.”</E> • <E T="03">Paragraph (a):</E> <E T="03">General</E> was augmented to further describe the purpose of the Postal Service's suspension and debarment process, and clarify that suspension and debarment are separate from the procedures under § 601.105; • <E T="03">Paragraph (b):</E> <E T="03">Definitions</E> was revised to clarify all prior definitions, and add the following new definitions: Administrative Compliance Agreement, concurrence, contract, Debarment Official, excluded party, party, and voluntary exclusion; • <E T="03">Paragraph (c):</E> <E T="03">Debarment</E> now consolidates the procedures and grounds for debarment, which were previously included in paragraphs (h) through (k); • <E T="03">Paragraph (c)(1):</E> <E T="03">Procedures</E> (previously located at paragraph (k)) was expanded to more clearly define the processes and standards used to initiate and conduct debarment proceedings; • <E T="03">Paragraph (c)(2):</E> <E T="03">Grounds</E> (previously titled “ <E T="03">Causes for debarment”</E> and located at paragraph (h)) was revised for clarity, including confirming that a violation of federal ethics law or principles is grounds for debarment; • <E T="03">Paragraph (c)(3):</E> <E T="03">Mitigation</E> (previously located at paragraph (i)) received minor modifications for clarity; • <E T="03">Paragraph (c)(4):</E> <E T="03">Period of Debarment</E> (previously located at paragraph (j)) was revised to increase the standard period of debarment from 3 years to 5 years, confirm that the Debarment Official may debar a party for longer than 5 years, and clarify the process for a party to later seek a reduction of the debarment period; • <E T="03">Paragraph (c)(5):</E> <E T="03">Alternative remedies</E> is a new paragraph confirming the ability of a party to enter into an Administrative Compliance Agreement or agree to a voluntary exclusion in lieu of debarment; • <E T="03">Paragraph (d):</E> <E T="03">Suspension</E> consolidated the procedures for suspension, grounds for suspension, and period of suspension, which were previously located at paragraphs (e) through (g); • <E T="03">Paragraph (e):</E> <E T="03">Imputation of Conduct</E> was restructured as a stand-alone paragraph (previously located at paragraph (h)(4) and (h)(5)) and revised to confirm that the conduct of a party's affiliate may be imputed to that party; • <E T="03">Paragraph (f):</E> <E T="03">Suspension, debarment, and ineligible list</E> (previously located at paragraph (c)) was revised to clarify the Postal Service's use of the General Services Administration's System for Award Management ( <E T="03">SAM.gov</E> ) in reporting debarments and suspensions, and confirm that contracting officers must review the database before making any contract award; • <E T="03">Paragraph (g):</E> <E T="03">Treatment of debarred, suspended, or ineligible parties</E> (previously titled “ <E T="03">Treatment of suppliers included in the SAM Exclusions database”</E> and located at paragraph (d)) was augmented to further define how debarred, suspended, or ineligible parties will be treated with regards to contracting with or performing any services for the Postal Service; and • <E T="03">Paragraph (h):</E> <E T="03">Notices</E> was added to identify how all notices from the Debarment Official under this section must be sent. <LSTSUB> <HD SOURCE="HED">List of Subjects in 39 CFR Part 601</HD> Administrative practice and procedure, Government procurement, Postal Service. </LSTSUB> Accordingly, the Postal Service amends 39 CFR part 601 as follows: <HD SOURCE="HED">PART 601—PURCHASING OF PROPERTY AND SERVICES</HD> <REGTEXT TITLE="39" PART="601"> 1. The authority citation for 39 CFR part 601 continues to read as follows: <HD SOURCE="HED">Authority: </HD> 39 U.S.C. 401, 404, 410, 411, 2008, 5001-5605. </REGTEXT> <REGTEXT TITLE="39" PART="601"> 2. Section 601.113 is revised to read as follows: <SECTION> <SECTNO>§ 601.113 </SECTNO> <SUBJECT>Debarment, suspension, and ineligibility from contracting.</SUBJECT> (a) <E T="03">General.</E> The Postal Service's suspension and debarment process protects the Postal Service and other federal government entities from doing business with parties that engage in improper conduct. Except as provided otherwise in this part, the Postal Service may not solicit proposals from, or award new contracts to, parties that are excluded from federal contracting. Postal Service suppliers are also prohibited from awarding subcontracts to excluded parties, or employing excluded parties as key personnel or in positions that require access to Postal Service data, mail or facilities. Debarment, suspension and ineligibility under the procedures described in this section are separate from the procedures for declining to accept proposals under § 601.105. (b) <E T="03">Definitions—</E> (1) <E T="03">Administrative Compliance Agreement.</E> An agreement between the Postal Service Debarment Official and another party used to resolve suspension or debarment proceedings, or potential suspension or debarment proceedings. (2) <E T="03">Affiliate.</E> A business, organization, person, or individual connected by the fact that one controls or has the power to control the other, or by the fact that a third party controls or has the power to control both. Indications of control include, but are not limited to, interlocking management or ownership, identity of interests among family members, shared facilities and equipment, contractual relationships, common use of employees, or a business entity organized following the suspension, debarment, ineligibility or proposed debarment of a supplier which has the same or similar management, ownership, or principal employees as the supplier that was suspended, debarred, ineligible or proposed for debarment. Franchise agreements are not conclusive evidence of affiliation if the franchisee has a right to profit in proportion to its ownership and bears the risk of loss or failure. (3) <E T="03">Concurrence.</E> Written confirmation from the General Counsel that the conduct in question satisfies the legal requirements for suspension or debarment of a party, and advice on whether suspension or debarment is in the best interests of the Postal Service. (4) <E T="03">Contract.</E> Any agreement entered into between the Postal Service and another party under the authority delegated pursuant to § 601.104 or other delegated authority. (5) <E T="03">Debarment.</E> An exclusion from Postal Service and Federal Government contracting and subcontracting for a reasonable, specified period of time commensurate with the seriousness of the offense, failure, or inadequacy of performance. (6) <E T="03">Debarment Official.</E> The Postal Service's vice president, Supply Management, or his or her designee under a written delegation of authority. (7) <E T="03">Excluded party.</E> An individual or business entity that is ineligible to be awarded a Postal Service or other Federal contract as a result of the suspension and debarment process or by voluntary self-exclusion by the party. An excluded party may include a current or former Postal Service supplier or subcontractor; a current or former Postal Service employee; or an employee of a current or former supplier or subcontractor. Customers, strategic alliance partners, and other actual or former business associates of the Postal Service may also be excluded through this process. (8) <E T="03">General Counsel.</E> This includes both the General Counsel and the General Counsel's authorized representatives in the Law Department assigned to advise the Debarment Official. (9) <E T="03">Indictment.</E> Indictment for a criminal offense. An information or other filing by a competent authority charging a criminal offense is given the same effect as an indictment. (10) <E T="03">Ineligible.</E> An exclusion from contracting or subcontracting by an entity other than the Postal Service under statutes, executive orders, or regulations, such as the Davis-Bacon Act, the Service Contract Act, the Equal Employment Opportunity Act, the Walsh-Healy Public Contracts Act, the National Environmental Protection Act, and similar laws authorizing exclusion. As a matter of policy, the Postal Service does not do business with excluded parties, even if the exclusion did not arise under a Postal Service-specific law. (11) <E T="03">Party.</E> In this section, includes any individual, corporation, or similar businesses organization, any supplier as defined in paragraph (b)(13) of this section, or any customer or other legal entity that may do business with the Postal Service or be the subject of a suspension or debarment proceeding. (12) <E T="03 ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 27k characters. 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