The Postal Service acquires property and services pursuant to the authority of 39 U.S.C. 410.

These regulations are effective November 14, 2007. Solicitations issued and resulting contracts entered into prior to that date will be governed by the regulations in effect at the time the solicitation was issued.

All previous postal purchasing regulations, including the Postal Contracting Manual, Procurement Manual, the Purchasing Manual (Issues 1, 2 and 3), and procurement handbooks, circulars, and instructions, are revoked and are superseded by the regulations contained in this part.

The regulations contained in this part apply to all Postal Service acquisition of property (except real property) and services.

Only the Postmaster General/CEO; the Postal Service's vice president, Supply Management; contracting officers with written statements of specific authority; and others designated in writing or listed in this part have the authority to bind the Postal Service with respect to entering into, modifying, or terminating any contract regarding the acquisition of property, services, and related purchasing matters. The Postal Service's vice president, Supply Management, or his or her designee, may also delegate in writing local buying authority throughout the Postal Service.

(a) General. A person or organization wishing to have a continuing business relationship with the Postal Service in purchasing matters is expected to treat the Postal Service in the same manner as it would other valued customers of similar size and importance. The Postal Service reserves the right to decline to accept or consider proposals from a person or organization when that person or organization fails to meet reasonable business expectations or provide a high level of confidence regarding quality, prompt service, and overall professionalism.

(b) Declining to accept or consider proposals. The Postal Service may decline to accept or consider proposals when a person or organization exhibits unacceptable conduct or business practices that do not meet reasonable business expectations or does not provide a high level of confidence about the entity's current or future business relations. Unacceptable conduct or business practices include, but are not limited to:

(1) Marginal or dilatory contract performance;

(2) Failure to deliver on promises made in the course of dealings with the Postal Service;

(3) Providing false or misleading information regarding financial condition, ability to perform, or other material matters, including any aspect of performance on a contract; and

(4) Engaging in other questionable or unprofessional conduct or business practices.

(c) Notice. If the Postal Service elects to decline to accept or consider proposals from a person or organization, the vice president, Supply Management, or his or her designee, will provide a written notice to the person or organization by Certified Mail, return receipt requested, explaining:

(1) The reasons for the decision;

(2) The effective date of the decision;

(3) The scope of the decision;

(4) The period of time the decision will be in effect, (a matter at the Postal Service's discretion consistent with the circumstances); and

(5) The supplier's right to contest the decision.

(d) Contesting Decisions. If a person or organization believes the decision not to accept or consider proposals is not merited, it may contest the matter in accordance with § 601.108. The Postal Service may reconsider the matter and, if warranted, rescind or modify the decision to decline to accept or consider proposals.

(a) Definitions—(1) Days. Calendar days; however, any time period will run until a day that is not a Saturday, Sunday, or legal holiday.

(2) Disagreements. All disputes, protests, claims, disagreements, or demands of whatsoever nature arising in connection with the acquisition of property and services within the scope of § 601.103 of this chapter, except those:

(i) That arise pursuant to a contract under the Contract Disputes Act under § 601.109;

(ii) That concern debarment, suspension, or ineligibility under § 601.113; or

(iii) That arise out of the nonrenewal of transportation contracts containing other provisions for the review of such decisions.

(3) Interested parties. Actual or prospective offerors whose direct economic interests would be affected by the award of, or failure to award, the contract.

(4) Lodge. A disagreement is lodged on the date it is received by the contracting officer or the Supplier Disagreement Resolution Official, as appropriate.

(5) SDR Official. The Supplier Disagreement Resolution Official, a contracting officer designated by the Postal Service to perform the functions established under § 601.108.

(b) Policy. It is the policy of the Postal Service and in the interest of its suppliers to resolve disagreements by mutual agreement between the supplier and the responsible contracting officer. All disagreements must be lodged with the responsible contracting office in writing via facsimile, e-mail, hand delivery, or U.S. Mail. For disagreements that concern the award of a contract, the disagreement shall be lodged within 10 days of the date the supplier received notification of award or 10 days from the date the supplier received a debriefing, whichever is later. For disagreements that concern alleged improprieties in a solicitation, the contracting officer must receive the disagreement before the time set for the receipt of proposals, unless the disagreement concerns an alleged impropriety that does not exist in the initial solicitation but which is subsequently incorporated into the solicitation, in which event the contracting officer must receive the disagreement no later than the next closing time for the receipt of proposals following the incorporation. The resolution period shall last 10 days from the date when the disagreement is lodged with the contracting officer. During the supplier-contracting officer 10-day resolution period, the responsible contracting officer's management may help to resolve the disagreement. At the conclusion of the 10-day resolution period, the contracting officer must communicate, in writing, to the supplier his or her resolution of the disagreement.

(c) Alternative dispute resolution. Alternative dispute resolution (ADR) procedures may be used to resolve a disagreement. If the use of ADR is agreed upon, the 10-day limitation is suspended. If agreement cannot be reached, the supplier has 10 days to lodge its disagreement with the SDR Official.

(a) General. If a disagreement under § 601.107 is not resolved within 10 days after it was lodged with the contracting officer, if the use of ADR fails to resolve it at any time, if the supplier is not satisfied with the contracting officer's resolution of the disagreement, or if the decision not to accept or consider proposals under § 601.105 is contested, the SDR Official is available to provide final resolution of the matter. The Postal Service desires to resolve all such matters quickly and inexpensively in keeping with the regulations in this part.

(b) Scope and applicability. This procedure is established as the sole and exclusive means to resolve disagreements under § 601.107 and contests of decisions under § 601.105. This procedure is intended to expeditiously resolve disagreements that are not resolved at the responsible contracting officer level; to reduce litigation expenses, inconvenience, and other costs for all parties; to facilitate successful business relationships with Postal Service suppliers, the supplier community, and other persons; and to develop further the basis for the Postal Service's purchasing decisions and the administrative records concerning those decisions. All disagreements under § 601.107 and contests of decisions under § 601.105 will be lodged with and resolved, with finality, by the SDR Official under and in accordance with the sole and exclusive procedure established in this section.

(c) Lodging. The disagreement under § 601.107 or contest of decision under § 601.105 must be lodged with the SDR Official in writing via facsimile, email, hand delivery, or U.S. Mail. The disagreement under § 601.107 or contest of decision under § 601.105 must state the factual circumstances relating to it and the remedy sought. A disagreement under § 601.107 must also state the scope and outcome of the initial disagreement resolution attempt with the contracting officer. The address of the SDR Official is: Supply Management, Room 1141 (Attn: SDR Official), United States Postal Service Headquarters, 475 L'Enfant Plaza SW., Washington, DC 20260-1141; email Address: [email protected]; Fax Number: (202) 268-0075.

(d) Lodging timeframes. Disagreements under § 601.107 or contests of decisions under § 601.105 must be lodged with the SDR Official within the following timeframes:

(1) Disagreements under § 601.107 not resolved with the contracting officer must be lodged with the SDR Official within 20 days after they were lodged with the contracting officer (unless ADR had been used to attempt to resolve them);

(2) Disagreements under § 601.107 for which ADR had been agreed to be used must be lodged with the SDR Official within 10 days after the supplier knew or was informed by the contracting officer or otherwise that the matter was not resolved;

(3) Where a supplier is dissatisfied with the contracting officer's resolution of a disagreement under § 601.107, the supplier must lodge the disagreement with the SDR Official within 10 days after the supplier first receives notification of the contracting officer's resolution; and

(4) Contests of decisions under § 601.105 to decline to accept or consider proposals must be lodged with the SDR Official within 10 days of the supplier's receipt of the written notice explaining the decision.

(5) The SDR Official may grant an extension of time to lodge a disagreement under § 601.107 or contest of decision under § 601.105 or to provide supporting information when warranted. Any request for an extension must set forth the reasons for the request, be made in writing, and be delivered to the SDR Official on or before the time to lodge a disagreement lapses.

(e) Disagreement decision process. The SDR Official will promptly provide a copy of a disagreement to the contracting officer, who will promptly notify other interested parties. The SDR Official will consider a disagreement and any response by other interested parties and appropriate Postal Service officials within a time frame established by the SDR Official. The SDR Official may also meet individually or jointly with the person or organization lodging the disagreement, other interested parties, and/or Postal Service officials, and may undertake other activities in order to obtain materials, information, or advice that may help to resolve the disagreement. The person or organization lodging the disagreement, other interested parties, or Postal Service officials must promptly provide all relevant, nonprivileged materials and other information requested by the SDR Official. If a submission contains trade secrets or other confidential information, it should be accompanied by a copy of the submission from which the confidential matter has been redacted. The SDR Official will determine whether any redactions are appropriate and will be solely responsible for determining the treatment of any redacted materials. After obtaining such information, materials, and advice as may be needed, the SDR Official will promptly issue a written decision resolving the disagreement and will deliver the decision to the person or organization lodging the disagreement, other interested parties, and appropriate Postal Service officials. When resolving a disagreement raised under § 601.107, the SDR Official may grant remedies including, but not limited to, the following:

(1) Directing the contracting officer to revise the solicitation or to issue a new solicitation;

(2) Directing the contracting officer to recompete the requirement;

(3) Directing the contracting officer to reevaluate the award on the basis of current proposals and the evaluation factors contained in the solicitation; and

(4) Directing the contracting officer to terminate the contract or to refrain from exercising options under the contract.

(f) Guidance. The SDR Official will be guided by the regulations contained in this part and all applicable public laws enacted by Congress. Non-Postal Service procurement rules or regulations and revoked Postal Service regulations will not apply or be taken into account. Failure of any party to provide requested information may be taken into account by the SDR Official in the decision.

(g) Final resolution by the SDR Official and final contract award of the Postal Service. A resolution by the SDR Official will be final and binding. If the SDR Official's final resolution affirms the original contract award of the contracting officer, the contracting officer's original contract award becomes the Postal Service's final contract award, and may be subject to judicial review as described in paragraph (h) of this section. If the SDR Official's final resolution directs that the Postal Service terminate the contract award and issue a new solicitation, recompete the requirement, or reevaluate the current award, the contracting officer shall implement promptly the SDR Official's final resolution. However, any contract award made by the contracting officer after a resolicitation, recompetition, or reevaluation directed by the SDR Official is not a final contract award of the Postal Service that may be subject to judicial review unless and until disagreements concerning that contract award have been lodged and resolved with finality by the SDR Official.

(h) Judicial review. The Postal Service's final contract award, as described in paragraph § 601.108(g), may be appealed to a Federal court with jurisdiction based only upon an alleged violation of the regulations contained in this part or an applicable public law enacted by Congress. The party lodging the disagreement may seek review of the Postal Service's final contract award only after the mandatory administrative remedies provided under § 601.107 and § 601.108 have been exhausted.

(i) Resolution timeframe. It is intended that this procedure generally will resolve disagreements under § 601.107 or contests of decisions under § 601.105 within approximately 30 days after receipt by the SDR Official. The time may be shortened or lengthened depending on the complexity of the issues and other relevant considerations.

(a) General. This section implements the Contract Disputes Act of 1978, as amended (41 U.S.C. 7101-7109).

(b) Policy. The Postal Service intends and seeks to resolve contractual claims and disputes by mutual agreement at the level of an authorized contracting officer whenever possible. The contracting officer may also consider holding informal discussions between the parties in order to resolve the conflict before issuing any final decision.

(c) Applicability. This section shall apply to all claims arising out of, or relating to, any contract, including any agreement entered into under authority delegated pursuant to § 601.104 for:

(1) The procurement of property, including license or leasehold interests in real property, other than fee simple title to real property in being;

(2) The procurement of services;

(3) The procurement of construction, alteration, repair, or maintenance of real property; or

(4) The disposal of personal property.

(d) Supplier claim initiation. Supplier claims must be submitted in writing to the contracting officer for final decision within six years after accrual of a claim unless the parties agreed in writing to a shorter time period.

(e) Postal Service claim initiation. The contracting officer must issue a written decision on any Postal Service claim against a supplier within six years after accrual of a claim unless the parties agreed in writing to a shorter time period. The six-year time period does not apply to a Postal Service claim based on supplier fraud.

(f) Certified claims. Each supplier claim exceeding $100,000 must be accompanied by a certification in accordance with the supplier's contract.

(g) Misrepresentation or fraud. When the contracting officer determines that the supplier is unable to support any part of the claim and there is evidence or reason to believe the inability is attributable to either misrepresentation of fact or fraud on the supplier's part, the contracting officer must deny that part of the claim and refer the matter to the Office of Inspector General.

(h) Decision and appeal—(1) Contracting officer's authority. A contracting officer, within the limitations of his or her delegated authority, is authorized to decide or settle all claims arising under or relating to a contract subject to the Contract Disputes Act, except for:

(i) Claims or disputes for penalties or forfeitures prescribed by statutes or regulation that a Federal agency administers; or

(ii) Claims involving fraud.

(2) Contracting officer's final decision. The contracting officer must review the facts pertinent to the claim and issue a final decision in writing. The decision must include a description of the claim or dispute with references to the pertinent contract terms, a statement of the factual areas of agreement and disagreement, and a statement of the contracting officer's final decision with supporting rationale.

(3) Insufficient information. When the contracting officer cannot issue a decision because the supplier has not provided sufficient information, the contracting officer should request the required information. A supplier's failure to timely provide the requested information is an adequate reason to deny the claim.

(4) Furnishing decisions. The contracting officer must furnish a copy of the written decision to the supplier, and delivery may be by any method that provides evidence of receipt.

(5) Decisions on claims for $100,000 or less. If the supplier has asked for a decision within 60 days on a claim of $100,000 or less, the contracting officer must issue a final decision within 60 calendar days of its receipt. The supplier may consider the contracting officer's failure to issue a decision within the applicable time period as a denial of its claim and may file a lawsuit or appeal on the claim.

(6) Decisions on certified claims. For a certified claim over $100,000, the contracting officer must either issue a final decision within 60 days of its receipt, or notify the supplier within the 60-day period of the time when a decision will be issued. The time period established must be reasonable, taking into account the size and complexity of the claim, the adequacy of the supplier's supporting data, and any other relevant factors.

(7) Wording of decisions. The contracting officer's final decision must contain the following paragraph: “This is the final decision of the contracting officer pursuant to the Contract Disputes Act of 1978 and the clause of your contract entitled Claims and Disputes. You may appeal this decision to the Postal Service Board of Contract Appeals by filing a notice of appeal within ninety days from the date you receive this decision. You may file the notice of appeal online through the USPS Judicial Officer Department's Electronic Filing System website located at https://usps-judicialoffice.journaltech.com/public-portal, or by mailing or otherwise furnishing the notice of appeal to the Postal Service Board of Contract Appeals. You also may appeal by mailing or otherwise furnishing the written notice of appeal to the contracting officer within 90 days from the date you receive this decision. The notice should identify the contract by number, reference this decision, and indicate that an appeal is intended. Alternatively, you may bring an action directly in the United States Court of Federal Claims within 12 months of the date you receive this decision.”

(8) Additional wording for decisions of $50,000 or less. When the claim, or claims, denied total $50,000 or less, the contracting officer must add the following to the paragraph: “In taking an appeal to the Postal Service Board of Contract Appeals, you may include in your notice of appeal (1) an election to proceed under the Board's small claims (expedited) procedure, which provides for a decision within approximately 120 days, or (2) an election to proceed under the Board's accelerated procedure, which provides for a decision within approximately 180 days. If you do not make an election in the notice of appeal, you may do so by written notice anytime thereafter.”

(9) Additional wording for decisions over $50,000 up to $100,000. When the claim or claims denied total $100,000 or less, but more than $50,000, the contracting officer must add the following to the paragraph: “In taking an appeal to the Board of Contract Appeals, you may include in your notice of appeal an election to proceed under the Board's accelerated procedure, which provides for a decision within approximately 180 days. If you do not make an election in the notice of appeal, you may do so by written notice anytime thereafter.”

Any claim amount determined in a final decision to be payable, less any portion previously paid, should be promptly paid to the supplier without prejudice to either party in the event of appeal or action on the claim. In the absence of appeal by the Postal Service, a board or court decision favorable in whole or in part to the supplier must be implemented promptly. In cases when only the question of entitlement has been decided and the matter of amount has been remanded to the parties for negotiation, a final decision of the contracting officer must be issued if agreement is not reached promptly.

Interest on the amount found due on the supplier's claim must be paid from the date the contracting officer received the claim (properly certified, if required) or from the date payment would otherwise be due, if that date is later, until the date of payment. Simple interest will be paid at the rate established by the Secretary of the Treasury for each 6-month period in which the claim is pending. Information on the rate at which interest is payable is announced periodically in the Postal Bulletin.

Any party may seek review of an adverse decision of the Board of Contract Appeals in the Court of Appeals for the Federal Circuit or in any other appropriate forum.

(a) General. 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) Definitions—(1) Administrative Compliance Agreement. 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) Affiliate. 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) Concurrence. 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) Contract. Any agreement entered into between the Postal Service and another party under the authority delegated pursuant to § 601.104 or other delegated authority.

(5) Debarment. 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) Debarment Official. The Postal Service's vice president, Supply Management, or his or her designee under a written delegation of authority.

(7) Excluded party. 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) General Counsel. This includes both the General Counsel and the General Counsel's authorized representatives in the Law Department assigned to advise the Debarment Official.

(9) Indictment. 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) Ineligible. 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) Party. 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) Suspension. An exclusion from contracting and subcontracting for a reasonable period of time due to the pendency of a debarment proceeding or for other specified reasons.

(13) Supplier. For the purposes of this part, a supplier is any individual or other legal entity that:

(i) Directly or indirectly (e.g., through an affiliate) submits offers for, is awarded, or reasonably may be expected to submit offers for or be awarded, a Postal Service contract or ordering agreement, including a contract for carriage under Postal Service or commercial bills of lading, or a subcontract under a Postal Service contract; or

(ii) Conducts business or reasonably may be expected to conduct business with the Postal Service as a subcontractor, an agent, or a representative of another supplier.

(14) Voluntary exclusion. Voluntary exclusion results from a supplier's written agreement to be excluded for a period of time under the terms of a settlement between the supplier and the Debarment Official of the Postal Service or another Federal agency.

(c) Debarment—(1) Procedures. (i) A debarment proceeding is initiated by submitting a written request to the Debarment Official. The request should identify all parties who are proposed for debarment and describe the factual or legal grounds upon which the request is made. The request should also include any pertinent supporting documentation.

(ii) After reviewing the basis for a debarment request and obtaining concurrence from the General Counsel, the Debarment Official may initiate debarment proceedings by sending the party proposed for debarment a written notice of proposed debarment. The notice will state that debarment is being considered; the reasons for the proposed debarment; the anticipated period of debarment and the proposed effective date; and that, within 30 days of the notice, the party, individually or through a representative, may submit in writing information in opposition to the proposed debarment. In the event a party does not submit information in opposition to the proposed debarment to the Debarment Official within the time allowed, the debarment will become final with no further review or appeal.

(iii) If there is any question of material fact involving the debarment allegations, the Debarment Official may seek additional information from the party or other persons. In establishing such material fact(s), the Debarment Official may in his or her discretion request the Judicial Officer to hold a fact-finding hearing on such matters. The hearing will be governed by the rules of procedure at 39 CFR part 955. The Debarment Official must consider but may reject any findings of fact, in whole or in part. Questions of fact to be resolved by a hearing before the Judicial Officer will be based on a preponderance of the evidence.

(iv) After consideration of the circumstances and any information and argument submitted by the party, the Debarment Official, with the concurrence of the General Counsel, will issue a written decision regarding whether the party is debarred, and, if so, the period of debarment. The decision will be final and binding, unless the decision was procured by fraud or other criminal misconduct, or the decision was obtained in violation of the regulations contained in this part or an applicable public law enacted by Congress.

(v) If the party enters into any agreement regarding improper conduct whereby the party states that it will not contest any debarment on the grounds of the improper conduct, the Debarment Official is not required to comply with the requirements of this paragraph (c)(1) and, with the concurrence of the General Counsel, may proceed to immediately debar the party by providing a written decision stating that the party is debarred effective immediately and identifying the period of debarment.

(2) Grounds. (i) The Debarment Official, with the concurrence of the General Counsel, may debar a party, including any of its affiliates, for engaging in improper conduct such as the following:

(A) Indictment or charging of a criminal offense incidental to obtaining or attempting to obtain contracts or subcontracts, or in the performance of a contract or subcontract.

(B) Violation of a Federal antitrust statute arising out of the submission of bids or proposals.

(C) Commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, tax evasion, receiving stolen property, or any other criminal offense of moral turpitude.

(D) Misconduct involving theft or abuse of mail, narcotics trafficking, willful disregard of applicable laws or safety standards, or other conduct demonstrating a lack of honesty or responsibility.

(E) Breach of a Postal Service contract so severe as to justify debarment, including, but not limited to, willful failure to perform a Postal Service contract in accordance with the specifications or within the time limit(s) provided in the contract; repeated failures to perform or unsatisfactory performance in accordance with the terms of one or more Postal Service contracts; violation of a contractual provision against contingent fees; or acceptance of a contingent fee paid in violation of a contractual provision against contingent fees.

(F) Violation of, or aiding any Postal Service employee or agent in the violation of, any federal ethics laws or principles.

(G) Any other offense indicating a lack of business integrity or business honesty.

(H) Any other cause of a serious and compelling nature for which debarment is warranted.

(ii) The existence of any of the causes for debarment in this section can be established by a preponderance of the evidence, as determined by the Debarment Official.

(3) Mitigation. (i) The decision to debar is within the discretion of the Debarment Official, with the concurrence of the General Counsel, and must be made in the best interests of the Postal Service. The Debarment Official may consider the following mitigating factors in deciding whether debarment is warranted, and even if warranted, the period of debarment established:

(A) Whether the party had, or was in the process of establishing, written standards of conduct and published internal control systems at the time of the improper conduct, or adopted such procedures prior to any Postal Service investigation of the activity cited that constitutes the grounds for debarment.

(B) Whether the party promptly brought the improper conduct to the attention of the Postal Service.

(C) Whether the party promptly and fully investigated the circumstances involving the grounds for debarment and, if so, made the full results of the investigation available to the Postal Service.

(D) Whether the party cooperated fully with the Postal Service during its investigation into the circumstances involving debarment.

(E) Whether the party paid or agreed to pay all criminal, civil and administrative penalties or liability, and any other costs arising out of the improper conduct, including any investigative or administrative costs incurred by the Postal Service.

(F) Whether the party took appropriate disciplinary action against the individual(s) responsible for the improper conduct.

(G) Whether the party implemented and/or agreed to implement remedial measures, including those identified by the Postal Service.

(H) Whether the party instituted and/or agreed to institute new and/or revised review and control procedures and ethics programs.

(I) Whether the party had adequate time to eliminate circumstances within the party's organization that could lead to debarment.

(J) Whether the party's senior officers and mid-level management recognize and understand the seriousness of the misconduct giving rise to debarment.

(ii) The existence or nonexistence of mitigating factors or remedial measures such as those listed in paragraph (c)(3)(i) of this section is not determinative of whether or not a party should be debarred. The party has the burden of demonstrating, to the satisfaction of the Debarment Official, that debarment is not warranted or necessary, or that the period of debarment should be reduced.

(4) Period of debarment. (i) When an applicable statute, executive order, or controlling regulation of another agency provides a specific period of debarment, that period applies. In other cases, debarment by the Postal Service shall be for a reasonable, definite, stated period of time, commensurate with the seriousness of the offense or the failure or inadequacy of performance. While generally a period of debarment should not exceed 5 years, the Debarment Official may, in his or her discretion, debar a party for longer than 5 years in cases of severe improper conduct.

(ii) Except as precluded by an applicable statute, Executive order, or controlling regulation of another agency, a debarred party may submit a request to the Debarment Official to remove the debarment or reduce the period of debarment. The party must support the request with a reasonable justification, such as newly discovered material evidence, acquittal or reversal of a conviction, bona fide change of ownership or management, or the elimination of the causes for which debarment was imposed. The Debarment Official may, in his or her discretion, approve or deny any such request by written decision.

(5) Alternative remedies—(i) Administrative Compliance Agreement. After considering the improper conduct and any mitigating factors, as well as any information submitted by the party proposed for debarment, the Debarment Official may determine, in his or her discretion, with concurrence from the General Counsel, that it is in the best interests of the Postal Service to forgo debarring or suspending a party, but only if the party agrees to undertake certain remedial measures. In such cases, the Debarment Official may, after consultation with the General Counsel, enter into an Administrative Compliance Agreement with the party on such terms and conditions as the Debarment Official and the party may agree.

(ii) Voluntary exclusion. After considering the improper conduct and any mitigating factors, as well as any information submitted by the party proposed for debarment, the Debarment Official may determine, in his or her discretion, that it is in the best interests of the Postal Service to forgo debarring or suspending a party, provided that the party agrees not to submit proposals for new Postal Service business for a specified period of time.

(d) Suspension—(1) Procedures. (i) For a suspension pursuant to paragraph (d)(2)(i) or (ii) of this section, or any extension of a suspension, the Debarment Official will notify the party of a suspension or an extension of a suspension and the reason(s) therefor.

(ii) For a suspension pursuant to paragraph (d)(2)(iii) of this section, the suspension is effective upon issuance of the notice of proposed debarment and for the period stated in the notice, unless superseded by the party's debarment.

(iii) Within 30 days of notice of suspension or any extension, a party may submit to the Debarment Official, in writing, any information or reason(s) the party believes makes a suspension or an extension inappropriate. The Debarment Official, after consultation with the General Counsel, will consider the party's submission and, in his or her discretion, may revoke a suspension or an extension of a suspension by written decision.

(2) Grounds. The Debarment Official, after consultation with the General Counsel, may suspend any party, including any of its affiliates, for the following:

(i) If the party commits, is indicted for, or is charged with any of the offenses identified in paragraph (c)(2)(i) of this section and the Debarment Official determines not to institute debarment proceedings until the conclusion of any judicial or administrative proceedings related thereto;

(ii) For any other cause of such serious and compelling nature that suspension is warranted; or

(iii) If the Postal Service has notified a party of its proposed debarment under this part.

(3) Period of suspension. A suspension shall generally not exceed 1 year in duration, except that the Debarment Official may extend a suspension for reasonable periods of time beyond 1 year. The termination of a suspension will not prejudice the Postal Service's position in any debarment proceeding. A suspension is superseded by a decision rendered by the Debarment Official to debar a party.

(e) Imputation of conduct. (1) The improper conduct of an individual may be imputed to the firm with which he or she is or has been connected when the grounds for debarment or impropriety were committed. Likewise, when a firm is involved in criminal, fraudulent, or other improper conduct, any person who participated in, knew of, or had reason to know of the impropriety may be debarred.

(2) The improper conduct of one party participating in a joint venture or similar arrangement may be imputed to other participating parties if the conduct occurred for or on behalf of the joint venture or similar arrangement, or with the knowledge, approval, or acquiescence of the other parties. Acceptance of the benefits derived from the conduct will be evidence of such knowledge, approval, or acquiescence.

(3) The improper conduct of a party may be imputed to an affiliate, and the improper conduct of an affiliate may be imputed to a party.

(f) Debarment, suspension, and ineligible list. (1) The Postal Service uses the General Services Administration's System for Award Management (SAM.gov) to determine if parties are debarred, suspended, proposed for debarment, or ineligible. Inquiries concerning listed parties should be directed to the agency or other authority that took the action.

(2) Through a representative, the Debarment Official will use SAM.gov to report Postal Service debarments, suspensions, proposed debarments, and changes in status.

(3) Contracting officers must review the SAM.gov Exclusions Database before making any contract award.

(g) Treatment of debarred, suspended, or ineligible parties. (1) Parties that are debarred, suspended, or ineligible are excluded from the following:

(i) Being awarded any contract with the Postal Service;

(ii) Receiving any subcontract to provide property or services under any Postal Service contract;

(iii) Submitting proposals or offers of any manner to the Postal Service in an attempt to obtain an award of a contract;

(iv) Providing property or services to other persons or entities for resale, in whole or part, to the Postal Service;

(v) Being employed and performing as designated key personnel under a Postal Service contract or subcontract; or

(vi) Having access to mail, Postal Service data, or Postal Service facilities under a Postal Service contract or subcontract.

(2) The debarment, suspension, or ineligibility of a party does not, of itself, affect the rights and obligations of the parties to any valid, pre-existing contract. The Postal Service may terminate for default a contract with a party that becomes debarred, suspended, or ineligible during the contract's period of performance. Contracting officers may not add new work to any contract with a party that is debarred, suspended, or ineligible by supplemental agreement, by exercise of any option, or otherwise (unless the work is classified as an insignificant or significant minor service change to a mail transportation contract).

(3) All parties doing business with the Postal Service are obligated to review the database identified in paragraph (f) of this section in order to exclude debarred, suspended, or ineligible parties from performing any part of a Postal Service contract.

(4) Notwithstanding paragraphs (g)(1) through (3) of this section, and in his or her discretion, the Debarment Official may approve a deviation from any part of this paragraph (g) if, after consultation with the General Counsel, it is determined to be in the best interests of the Postal Service.

(h) Notices. Any decision by or notice from the Debarment Official to a party under this section shall be sent by any method that provides evidence of receipt, with a copy furnished to the USPS Office of the Inspector General.